TCR_Public/080905.mbx          T R O U B L E D   C O M P A N Y   R E P O R T E R

            Friday, September 5, 2008, Vol. 12, No. 112           

                             Headlines

AMBAC FINANCIAL: Wisconsin COI Approves Reactivation of Connie Lee
AMERICAN AXLE: Fitch Cuts IDR and Sr. Unsecured Debt Ratings to B+
AMERICAN FARMERS: Best Chips Issuer Credit Rating to bb- from bbb-
ARMSTRONG WORLD: Court Enters Final Order Closing Chapter 11 Case
ARMSTRONG WORLD: Court Closes Nitram & Desseaux Chapter 11 Cases

ARMSTRONG WORLD: Post-Confirmation Report for June 2008 Quarter
ARMSTRONG WORLD: Nitram Files Report for June 2008 Quarter
ARMSTRONG WORLD: Desseaux Files Report for June 2008 Quarter
ASARCO LLC: Insurers Object to Plan Confirmation Timeline
ASARCO LLC: Settles Tacoma Park District Claim for $5 Million

ASPEN COMPANY: Case Summary & Two Largest Unsecured Creditors
ATHEROGENICS INC: Defaults on 2008 Note Indenture
ATTICUS CAPITAL: Dismisses Rumors on Liquidation and Shutdown
BANK OF AMERICA: Fitch Rates $28.741 Million Class J Trust 'B'
BARBEQUES GALORE: Grand Hall to Purchase Assets for $12 Million

BARE ESCENTUALS: Moody's Lowers Corporate Family Rating to Ba3
BEAR STEARNS: Gov't Seeks Stay of SEC Case Againts Cioffi & Tannin
BEAR STEARNS: Majority Supports Judge's Decision, ABI Poll Says
BEAR STEARNS: Moody's Cuts Ratings on 142 Tranches of ARM Deals
BEATRICE BIODIESEL: Project to Get $30 Million Capital Infusion

BLACKBOARD INC: S&P Upgrades Rating on $165MM Sr. Notes to 'B+'
BLACKHAWK AUTOMOTIVE: Taps CB Richard Ellis as Real Estate Broker
BLUEPOINT RE: Hearing to Consider Chapter 15 Petition Set Sept. 29
BOB LENC: Case Summary & 20 Largest Unsecured Creditors
BRIT ALLIANCE: Fitch Junks Rating on $30 Million Class A Notes

CALLIDUS DEBT: S&P Lowers Rating on $18 Mil. Class Notes to 'B-'
CALPINE CORP: Appoints Thad Hill as EVP and Commercial Officer
CANCER INSTITUTE: Voluntary Chapter 11 Case Summary
CASTLE ROCK: Voluntary Chapter 11 Case Summary
CHAMBERS PLACE 04: Voluntary Chapter 11 Case Summary

CHRYSLER LLC: August 2008 U.S. Sales Down 34% at 110,235 Units
CHRYSLER LLC: Canada Sales for August 2008 Fall 24%
CHRYSLER LLC: Discloses Leadership Appointments in Finance Office
CITIBANK NA: Moody's Slashes Rating on $5,100,000 Notes to Ba1
COMSTOCK HOMEBUILDING: BB&T Forecloses Assets for $32.7MM Debt
CREDIT CDO 2007-1: Planned Liquidation Prompts S&P to Junk Ratings

CREDIT SUISSE MORTGAGE: S&P Affirms Class P Certificates at CCC
CSFB ADJUSTABLE: Moody's Downgrades Ratings on 186 Alt-A Deals
CWALT INC: Moody's Lowers Ratings on 311 Tranches of Certificates
DELPHI CORP: Appaloosa Insists Right to Cancel Funding Pledge
D'ESPRIT INC: Case Summary & 7 Largest Unsecured Creditors

DISTRIBUTED ENERGY: Northern Power Unit Will Keep Workers
DUNMORE HOMES: Dispute on JMP Bid to File Tardy Claim for $2MM
DUNMORE HOMES: $1.5MM Lender Receivable Offset Stipulation OK'ed
ETELOS INC: June 30 Balance Sheet Upside-Down by $15,815,000
EXIDE TECHNOLOGIES: Wants Deadline to Remove Actions Extended

EXIDE TECHNOLOGIES: Wants Oct. 31 Extension to Review Claims
EXIDE TECHNOLOGIES: Settles $418,000 EPA Claim on Superfund Site
FEDDERS CORP: Insurers Seek Relief From Confirmation Order
FINOVA GROUP: Must Pay $81.2MM to Creditors, District Court Rules
FIRST DOMINION: Moody's Lifts Ratings on Three Notes to Ba3

FORD MOTOR: August 2008 Vehicle Sales Drop 25.6% to 151,021
FRED LEIGHTON: Court Approves Retention of Three Firms
FREMONT GENERAL: CEO and President Tender Resignations
GENERAL MOTORS: Flint Okays Tax Incentives for Proposed Plant  
GENERAL MOTORS: August Total Vehicle Sales Down 20% to 308,817

GRANDLUXE RAIL: Financial Woes Blamed for Shutdown
HANDLEMAN CO: Grant Thornton Expresses Going Concern Doubt
HENRY JOHNSON: Case Summary & Nine Largest Unsecured Creditors
HERITAGE FARMS: Case Summary & Three Largest Unsecured Creditors
HIGH GRADE STRUCTURED: Moody's Junks Ratings on Four Senior Notes

HOME EQUITY: Moody's Junks Ratings on Five 2006-2 Note Classes
IDA GALATI: Voluntary Chapter 11 Case Summary
IDLEAIRE INC: Investment Firms Complete $17.5MM IdleAire Purchase
INTERMET CORP: Obtains Authority to Pay Various Prepetition Claims
INTERMET CORP: May Employ Kurtzman Carson as Notice Agent

INTERSTATE BAKERIES: Steve Lee Wins Bakery & Retail Properties
JACK HALL: Case Summary & 20 Largest Unsecured Creditors
JIM BALL: Voluntary Chapter 11 Case Summary
KIMBALL HILL: Wants to Sell KHH's Mineral Estate Property
KIMBALL HILL: Names Ken Love as New CEO, Diane Hill as Director

KIMBALL HILL: Committee Challenges Prepetition Lender's Lien
KIM & LEE: Case Summary & Five Largest Unsecured Creditors
KSG GROUP: Case Summary & 12 Largest Unsecured Creditors
LANDSOURCE COMMUNITIES: Time to File Schedules Moved to Sept. 6
LANDSOURCE COMMUNITIES: Panel Can Continue Probe on Lenders' Liens

LEHMAN XS: Moody's Slashes Ratings on 424 Alt-A Deal Tranches
LEHMAN MORTGAGE: Moody's Pares Ratings on 129 Alt-A Deal Tranches
LIBERTY MEDIA: Asset Split Cues Fitch to Put Negative Watch
LINDA LAWRENCE: Case Summary & 20 Largest Unsecured Creditors
LINENS N THINGS: Court OKs Waiver of Landlords' Action Claims

LORRO INC: Michigan Court Nixes $32 Mil. Claim Against Meridian
LUBBOCK MEDICAL: Lubbock Heritage Wins Auction with $3MM Bid
MARINE CENTER: Wants Court to Approve Sale Bidding Procedures
MATHIS PARTNERS: BB&T Forecloses on Parent's Assets
MERIDIAN AUTOMOTIVE: Delaware Court Closes Chapter 11 Cases Anew

MERIDIAN AUTOMOTIVE: Michigan Court Nixes Lorro's $32 Mil. Claim
MERIDIAN AUTOMOTIVE: 2nd Qtr 2008 Post-Confirmation Report
MESABA AVIATION: Court Directs Trustee to File Final Report
MESABA AVIATION: Court Approves Committee Advisors' Fees
MESABA AVIATION: Must Pay $3 Mil. Airport Lease Rejection Claim

MESABA AVIATION: Bid for Williamsport Airport Flights Rejected
MGM MIRAGE: S&P Confirms 'BB' Corporate Credit Rating
MICHAEL JAMES: Case Summary & 20 Largest Unsecured Creditors
MIDWEST AIR: Pilots Irate at Pact With Republic Airways
MIDWEST AIR: Obtains $60Mil. Financing From Republic Airways & TPG

MORTGAGES LTD: Judge to Approve Plan Giving $2.8MM to Developer
NATIONSLINK FUNDING: Fitch Affirms 'BB' Rating on $6.6MM Certs.
NCP LLC: Case Summary and Largest Unsecured Creditor
NELLIS BOULEVARD: Case Summary & Four Largest Unsecured Creditors
NETBANK INC: U.S. Trustee Objects to Liquidation Plan

NEW CAP: Court Grants Recognition to Scheme of Arrangement in U.S.
NORTHAMPTON GENERATING: S&P Cuts Rating on $153 Mil. Bonds to 'B'
PFP HOLDINGS: Agrees to Appointment of Chapter 11 Trustee
POWERMATE CORP: Committee Sues Sun Capital for Fraudulent Transfer
PRESBYTERIAN VILLAGES: Fitch Holds 'BB+' Rating on $32.38MM Bonds

PROGRESSIVE GAMING: To Implement Reverse Stock Split by Sept. 15
RALI SERIES: Moody's Cuts Ratings on 172 Alt-A Deal Tranches
RED SHIELD: Court Approves Additional $500,000 Loan for Payroll
REMOTEMDX INC: June 30 Balance Sheet Upside-Down by $754,521
RIDGEVIEW 8888: Case Summary and Largest Unsecured Creditor
RIVER ROCK: Commences Cash Tender Offer for 9-3/4% Senior Notes

RMBS MORTGAGE: S&P Cut Rating on 20 Class Notes to 'D'
SAYBROOK CBO: Fitch Lowers Ratings on Five Notes; Removes Watch
SELECTIVE INSURANCE: Moody's Affirms Ratings; Outlook is Stable
SHASTA APARTMENTS: Voluntary Chapter 11 Case Summary
SHELLS SEAFOOD: Case Summary & 20 Largest Unsecured Creditors

SIX VENTURES: Case Summary & 14 Largest Unsecured Creditors
ST. STEPHEN: Houston Bankruptcy Court Dismisses Chapter 7 Petition
STATEN ISLAND HOSPITAL: Fitch Upgrades Bonds to 'B+'
TAILOR MADE: Case Summary & Six Largest Unsecured Creditors
TECHNOLOGY TODAY: Case Summary & 20 Largest Unsecured Creditors

TEMBEC INDUSTRIES: Files for Chapter 15 Protection in Manhattan
TEMBEC INDUSTRIES: Chapter 15 Case Summary
TENDER MILLS: Case Summary & 20 Largest Unsecured Creditors
UNION NATIONAL: Case Summary & 3 Largest Unsecured Creditors
USAA CREDIT: Moody's Rates $18,449,198 Asset Backed Notes at Ba3

VENOCO INC: Moody's Affirms Caa1 Rating on $500MM Loan Facility
WESTAFF INC: Posts $15.1MM Net Loss in Third Quarter Ended July 12
WICKES FURNITURE: Deadline to Remove Actions Extended to Nov. 2
WYNTHROPE HALL: Case Summary & 11 Largest Unsecured Creditors

* IATA Says Airlines to Lose $5.2 Billion in 2008

* Bankruptcy Filings Up 29% in 1H, Full-Year Ended June 2008

* BOOK REVIEW: The Fallen Colossus

                             *********


AMBAC FINANCIAL: Wisconsin COI Approves Reactivation of Connie Lee
------------------------------------------------------------------
Ambac Financial Group, Inc. received regulatory approval from the
Commissioner of Insurance of the State of Wisconsin to capitalize
and reactivate Connie Lee Insurance Company, its financial
guarantee subsidiary.

Connie Lee will conduct business under a new name and will focus
on the U.S. municipal and global public purpose financing markets.  

Ambac Assurance will inject $850 million into Connie Lee ,which
will operate as a separate corporate and legal entity within Ambac
Financial Group, Inc.  Ambac is seeking to obtain stand-alone
triple-A ratings for Connie Lee, and has worked extensively with
Moody's and Standard and Poor's towards that goal.  Connie Lee
expects to write new insurance policies no later than the fourth
quarter of 2008.

In conjunction with receiving regulatory approval, Ambac said that
Douglas Renfield-Miller, currently Executive Vice President of
Ambac and Chairman and CEO of Ambac Assurance UK Limited, has been
named CEO designate for Connie Lee.  Ambac will transfer certain
underwriting, management and support staff to Connie Lee over the
course of the next few months.  Benefiting from Ambac's historic
industry-leading experience, Ambac believes that Connie Lee will
have a distinct competitive advantage in the bond guarantee
marketplace.

Independent risk management will be a cornerstone of Connie Lee's
business model.  Demonstrating its commitment to this priority,
Ambac is pleased to announce that Judy Slotkin has been hired as
Chief Risk Officer for Connie Lee. Ms. Slotkin brings extensive
experience in investment and commercial banking, and has held
positions as Senior Credit Officer of Citigroup and Credit Head
for Citigroup's Public Finance business.

"We are delighted to welcome Judy aboard and excited at the
prospects for Connie Lee," Douglas Renfield-Miller, CEO designate
for Connie Lee, commented.  "We believe that Connie Lee will
redefine the financial guarantee business model through its clean
balance sheet, municipal and public purpose focused business,
strong corporate governance and unprecedented transparency.  
Public sector issuers are facing increased financing needs and
increased funding costs at a time when the availability of
insurance has been seriously curtailed.  We believe Connie Lee
will fill a critical need while also fully addressing investor
concerns with the financial guarantee business model."

"Connie Lee will help carry forward the successful franchise Ambac
has built up over 37 years while addressing rating agency concerns
regarding business production," said Michael Callen, Chairman and
CEO of Ambac.  "This is an important element in our strategy to
restore Ambac Assurance's own triple-A ratings and create value
for our shareholders."

Headquartered in New York City, Ambac Financial Group, Inc. --
http://ir.ambac.com/-- is a holding company that provides      
financial guarantees and financial services to clients in both the
public and private sectors around the world through its principal
operating subsidiary, Ambac Assurance Corporation.  As an
alternative to financial guarantee insurance credit protection is
provided by Ambac Credit Products, a subsidiary of Ambac
Assurance, in credit derivative format.

                          *     *     *

The Troubled Company Reporter said on June 9, 2008, that Standard
& Poor's Ratings Services lowered its standard long-term ratings
on 20 Ambac Assurance Corp.-backed issues listed below to 'AA'
from 'AAA' and placed them on CreditWatch with negative
implications.  At the same time, Standard & Poor's lowered its
underlying ratings on seven Ambac Assurance Corp.-backed issues
listed below to 'AA' from 'AAA' and placed them on CreditWatch
with negative implications.  These actions follow Standard &
Poor's downgrade of Ambac Assurance Corp. to 'AA' from 'AAA' and
placement on CreditWatch with negative implications.

Ambac Financial Group Inc. said in a statement responding to the
rating actions by Standard & Poor's Rating Services that it is
disappointed by the actions taken by S&P, the TCR said on June 9.

The TCR related on June 30, 2008, that Fitch Ratings withdrew all
of its outstanding ratings on Ambac Financial Group, Inc., Ambac
Assurance Corp. and other related entities, and all ratings based
on insurance policies from Ambac's insurance subsidiaries.  The
action followed the decision by Ambac's management to cease
providing substantive non-public portfolio information used in
Fitch's capital analysis model, to discontinue previous full
interactive dialogue with Fitch analysts, and to request
withdrawal of Fitch's ratings.


AMERICAN AXLE: Fitch Cuts IDR and Sr. Unsecured Debt Ratings to B+
------------------------------------------------------------------
Fitch Ratings has downgraded American Axle's Issuer Default Rating
to 'B+' from 'BB-' and senior unsecured debt to 'B+/RR4' from
'BB-'.  The rating action incorporates a further reduction in
Fitch's short and long-term production forecasts for Axle's
primary platform, as well as negative cash flows and a
deteriorating balance sheet into 2009 as the company transitions
its labor force and domestic manufacturing footprint.  Over the
longer-term, a healthy new business backlog, an expanding product
line, manufacturing excellence and improving diversification by
geography and customer position the company to re-establish top-
line growth from trough levels and reduce its current reliance on
GM truck and large SUV volumes.

To enhance liquidity and address the 2010 maturity of its bank
agreement, Fitch expects that the company will refinance its
existing bank agreement with a secured facility, which will impair
the position of unsecured holders and potentially result in
further rating actions on the unsecured debt.

Elevated gas prices and weak economic conditions have led to
further deterioration in 2008 and 2009 estimates for Axle's
primary product platform, the GMT-900, which serves as the basis
for GM's pickups and large SUV's.  Although Fitch expects that
pickup truck sales will eventually rebound from current cyclical
trough levels, a healthy portion of the volume decline is
considered permanent.  GM's recent capacity actions and long-term
product planning confirm these expectations.

Axle's balance sheet and its recent labor agreement have
positioned the company to weather product volume declines and
harsh market conditions that are expected to last at least through
2009.  The agreement with the UAW produced sweeping improvements
across Axle's fixed cost structure, including capacity reductions
and relocations, headcount reductions, lower wage rates, and long-
term benefit cost reductions.  The agreement also granted
additional flexibility in its cost structure through the
transition of various fixed costs to variable, enhancing Axle's
ability to manage through economic and product cycles.

Despite a sharp decline in the company's cash holdings, liquidity
remains adequate to finance the company's near term operating
losses and buyout expenditures.  In addition to further reductions
in its cash holdings (totaling $196 million at June 30, 2008) and
employee buyout financing from GM, Fitch expects that Axle will
draw on its revolving credit over the near term until the company
realizes the full benefits of its cost reduction and manufacturing
relocations in the second half of 2009.  Fitch projects that Axle
could return to positive free cash flow in the second half of
2009, and that Axle will show positive free cash flow in 2010 as a
result of the company's cost structure, new business wins and an
eventual rebound in the U.S. pickup truck market.

Debt could increase by $200 million through 2009 from the current
level of $858 million, in the event of further market
deterioration and if cost savings are not realized on a timely
basis.  Over the longer term, debt reduction will be correlated to
the growth of the company's international and non-GM business.  
Fitch remains comfortable with the expected profitability of the
company's backlog, although high commodity costs will continue to
weigh on margins.

Axle may violate the leverage covenant of its bank agreement in
2008 as a result of the steep decline in 2008 EBITDA.  As a result
of this and the April 2010 maturity, Fitch expects that Axle will
work to shortly negotiate a replacement facility.  Despite
challenging capital markets, Fitch expects that Axle will be able
to obtain a facility of roughly the same size, although on a
secured basis.  Axle's facility is currently at $600 million, with
approximately $572 million available as of June 30.  No other
maturities occur until 2012.  Fitch's recovery analysis indicates
that in the event of a secured facility being put in place, the
ratings of existing unsecured debt could be downgraded an
additional one-to-two notches.

Fitch has taken these rating actions:

American Axle & Manufacturing Holdings, Inc.
  -- IDR to 'B+' from 'BB-'.

American Axle & Manufacturing, Inc.
  -- IDR to 'B+' from 'BB-';
  -- Senior unsecured credit facility to 'B+/RR4' from 'BB-';
  -- Senior unsecured term loan to 'B+/RR4' from 'BB-';
  -- Senior unsecured notes to 'B+/RR4' from 'BB-'.


AMERICAN FARMERS: Best Chips Issuer Credit Rating to bb- from bbb-
------------------------------------------------------------------
A.M. Best Co. has downgraded the financial strength rating to
B-(Fair) from B+(Good) and issuer credit rating to bb-" from bbb-"
of American Farmers & Ranchers Group (Oklahoma City) and its
members American Farmers & Ranchers Mutual Insurance Company and
American Farmers & Ranchers Insurance Company (Boise, ID).

All ratings remain under review with negative implications due to
the uncertainty regarding the group's future capital position and
the challenges management will face integrating new business into
the current operating structure.

These rating actions are a result of the significant decline in
capitalization that occurred in 2007 and the first six months of
2008, due primarily to an increase in the frequency of major storm
losses in its operating territory.  The decline in surplus while
maintaining significant underwriting risk adversely affected the
group's risk-adjusted capitalization.  In addition, the recent
acquisition of American Farmers & Ranchers Insurance Company,
which occurred in late 2007, creates operational and financial
challenges as management integrates this business into its
existing portfolio while implementing its geographic expansion
strategies.

The group will remain under review pending further discussions
with management regarding its capital management plans and
business development expectations.


ARMSTRONG WORLD: Court Enters Final Order Closing Chapter 11 Case
-----------------------------------------------------------------
Judge Judith K. Fitzgerald entered a final decree closing the
Chapter 11 case of Armstrong World Industries, Inc., Case No. 00-
4471, on September 2, 2008.  

The Bankruptcy Court will retain jurisdiction with respect to all
matters relating to Armstrong's case as provided by Armstrong's
Fourth Amended Plan of Reorganization, as modified.

The Debtor's bid to close its case drew informal comments from the
AWI Asbestos Personal Injury Trust.  Jason M. Madron, Esq., at
Richards, Layton & Finger, P.A., in Wilmington, Delaware, said no
parties-in-interest filed objections to Armstrong's request by the
August 18, 2008 objection deadline.  Mr. Madron said Armstrong
talked with the AWI Trust and the U.S. Trustee regarding a form of
order acceptable to all parties.

Pursuant to the Court order, Judge Fitzgerald directed the AWI
Asbestos Personal Injury Settlement Trust to file its annual
reports to the Bankruptcy Court as required by the Asbestos PI
Settlement Trust Agreement.  In turn, the Clerk of Court will
accept the AWI Trust Annual Reports without the requirement that
any party-in-interest file a request to reopen Armstrong's Chapter
11 case.

The Court also held that the consulting agreement between the
Debtors and Trumbull Services, L.L.C., is deemed terminated
effective October 31, 2008, Judge Fitzgerald ruled.  Trumbull
Services is Armstrong's claims agent.

The Court said the Final Decree closing the Armstrong bankruptcy
case does not prejudice Armstrong to reopen its Chapter 11 case
for cause.

Headquartered in Lancaster, Pennsylvania, Armstrong World
Industries, Inc. (NYSE:AWI) -- http://www.armstrong.com/--  
designs, manufactures and sells flooring products and ceiling
systems around the world.  It also designs, manufactures and sells
kitchen and bathroom cabinets.  Its business segments include
resilient flooring, wood flooring, building products and cabinets.  
On Dec. 6, 2000, it filed a voluntary petition for relief under
Chapter 11 of the United States Bankruptcy Code in the United
States Bankruptcy Court.  

An earlier version of Armstrong's Plan was confirmed by the
Bankruptcy Court in November 2003.  The District Court for the
District of Delaware did not affirm the confirmation of the Plan,
finding that the proposed distribution of new warrants to the
class of Equity Interest Holders over the objection of the class
of Unsecured Creditors violated the "fair and equitable"
requirement of Section 1129(b)(2)(B)(ii) of the Bankruptcy Code, a
codification of the  absolute priority rule.  Armstrong lost on
appeal before the Third Circuit Court of Appeals.

Armstrong filed a modified plan in February 2006, revising the
classification and treatment of Equity Interests to eliminate the
distribution of warrants to shareholders of AWI's parent company,
Armstrong Holdings, Inc.  Armstrong and the asbestos
constituencies in its case also asked the District Court to find
that the Debtors' present and future liability on account of
asbestos-related personal injury claims is not less than $3.1
billion, and, therefore, Armstrong's chapter 11 plan does not
unfairly discriminate against commercial creditors and should be
confirmed.

The Plan was confirmed by the District Court on August 14, 2006,
and Armstrong emerged from Chapter 11 on October 2, 2006.

Nitram and Desseaux also filed their Chapter 11 cases on
December 6, 2000. The Bankruptcy Court confirmed their First
Amended Joint Plan of Liquidation on December 17, 2007.

STEPHEN KAROTKIN, ESQ., at Weil, Gotshal & Manges, in New York,
JASON M. MADRON, ESQ., at Richards, Layton & Finger, P.A., in
Wilmington, Delaware, represented the Debtors.  STEPHEN J.
SHIMSHAK, ESQ., JOHN F. BAUGHMAN, ESQ., and ANDREW N. GORDON,
ESQ., at Paul, Weiss, Rifkind, Wharton & Garrison, LLP, in New
York, represented the Unsecured Creditors Committee.  ELIHU
INSELBUCH, ESQ., and NATHAN D. FINCH, ESQ., at Caplin & Drysdale
Chartered, in Washington, DC, represented the Asbestos Claimants
Committee.  JANE W. PARVER, ESQ., at Kaye Scholer, LLP, in New
York, represented Dean Trafelet, the future claimants
representative.

On April 3, 2006, Armstrong World acquired HomerWood Inc.  On
May 1, 2006, it acquired Capella Engineered Wood LLC, and its
parent company, Capella Inc.  On March 27, 2007, it entered into
an agreement to sell the principal operating companies in its
European textile and sports flooring business segment to
Tapijtfabriek H. Desseaux N.V. and its subsidiaries.  These
businesses were classified as discontinued at Oct. 2, 2006.    
(Armstrong Bankruptcy News; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


ARMSTRONG WORLD: Court Closes Nitram & Desseaux Chapter 11 Cases
----------------------------------------------------------------
Judge Judith K. Fitzgerald of the U.S. Bankruptcy Court for the
District of Delaware entered a final decree closing the Chapter 11
cases of Nitram Liquidators, Inc., and Desseaux Corporation of
North America on August 26, 2008.

Judge Fitzgerald clarifies that the Court will retain jurisdiction
as provided by Nitram and Dessaux's First Amended Joint Plan of
Liquidation.

Jason M. Madron, Esq., at Richards, Layton & Finger, P.A., in
Wilmington, Delaware, disclosed that no parties-in-interest
objected to the Nitram and Desseaux's Motion to Close.  The Court
previously set August 18, 2008, as the deadline for interested
parties to object to Nitram and Desseaux's request to close their
Chapter 11 cases.

The Court rules that Nitram and Desseaux will not be obliged to
pay quarterly fees to the U.S. Trustee pursuant to Section
1930(a)(6) of the Judicial and Judicial Procedures Code.  

The Final Decree to close the two bankruptcy cases does not
prejudice Nitram and Desseaux to reopen their Chapter 11 cases,
the Court holds.

Headquartered in Lancaster, Pennsylvania, Armstrong World
Industries, Inc. (NYSE:AWI) -- http://www.armstrong.com/--  
designs, manufactures and sells flooring products and ceiling
systems around the world.  It also designs, manufactures and sells
kitchen and bathroom cabinets.  Its business segments include
resilient flooring, wood flooring, building products and cabinets.  
On Dec. 6, 2000, it filed a voluntary petition for relief under
Chapter 11 of the United States Bankruptcy Code in the United
States Bankruptcy Court.  

An earlier version of Armstrong's Plan was confirmed by the
Bankruptcy Court in November 2003.  The District Court for the
District of Delaware did not affirm the confirmation of the Plan,
finding that the proposed distribution of new warrants to the
class of Equity Interest Holders over the objection of the class
of Unsecured Creditors violated the "fair and equitable"
requirement of Section 1129(b)(2)(B)(ii) of the Bankruptcy Code, a
codification of the  absolute priority rule.  Armstrong lost on
appeal before the Third Circuit Court of Appeals.

Armstrong filed a modified plan in February 2006, revising the
classification and treatment of Equity Interests to eliminate the
distribution of warrants to shareholders of AWI's parent company,
Armstrong Holdings, Inc.  Armstrong and the asbestos
constituencies in its case also asked the District Court to find
that the Debtors' present and future liability on account of
asbestos-related personal injury claims is not less than $3.1
billion, and, therefore, Armstrong's chapter 11 plan does not
unfairly discriminate against commercial creditors and should be
confirmed.

The Plan was confirmed by the District Court on August 14, 2006,
and Armstrong emerged from Chapter 11 on October 2, 2006.

Nitram and Desseaux also filed their Chapter 11 cases on
December 6, 2000. The Bankruptcy Court confirmed their First
Amended Joint Plan of Liquidation on December 17, 2007.

STEPHEN KAROTKIN, ESQ., at Weil, Gotshal & Manges, in New York,
JASON M. MADRON, ESQ., at Richards, Layton & Finger, P.A., in
Wilmington, Delaware, represented the Debtors.  STEPHEN J.
SHIMSHAK, ESQ., JOHN F. BAUGHMAN, ESQ., and ANDREW N. GORDON,
ESQ., at Paul, Weiss, Rifkind, Wharton & Garrison, LLP, in New
York, represented the Unsecured Creditors Committee.  ELIHU
INSELBUCH, ESQ., and NATHAN D. FINCH, ESQ., at Caplin & Drysdale
Chartered, in Washington, DC, represented the Asbestos Claimants
Committee.  JANE W. PARVER, ESQ., at Kaye Scholer, LLP, in New
York, represented Dean Trafelet, the future claimants
representative.

On April 3, 2006, Armstrong World acquired HomerWood Inc.  On
May 1, 2006, it acquired Capella Engineered Wood LLC, and its
parent company, Capella Inc.  On March 27, 2007, it entered into
an agreement to sell the principal operating companies in its
European textile and sports flooring business segment to
Tapijtfabriek H. Desseaux N.V. and its subsidiaries.  These
businesses were classified as discontinued at Oct. 2, 2006.  
(Armstrong Bankruptcy News; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


ARMSTRONG WORLD: Post-Confirmation Report for June 2008 Quarter
---------------------------------------------------------------
Armstrong World Industries, Inc., disbursed roughly $407,000,000
to
third parties for the period from April 2008 through June 2008.

                  Armstrong World Industries, Inc.
                       Unaudited Balance
Sheet                               
                                                          
                           As of June 2008

   Assets
   Cash (Unrestricted)                               $30,511,000
   Cash (Restricted)                                           -
   Accounts Receivable (Net)                         121,539,000
   Inventory                                         171,815,000
   Notes Receivable                                    3,830,000
   Prepaid Expenses                                   16,211,000
   Other                                             244,336,000
                                                 ---------------
      Total Current Assets                           588,242,000
                                                 ---------------
   Property, Plant & Equipment
   Real Property & Improvements                      220,297,000
   Machinery & Equipment                             444,984,000
   Furniture, Fixtures & Office Equipment             32,602,000
   Vehicles                                                    -
   Leasehold Improvements                                455,000
   Less: Accumulated Deprec/Depletion               (141,540,000)
                                                 ---------------
   Total Property, Plant & Equipment                 556,798,000

---------------             
                                                                             
                                       
   Due from Affiliates & Insiders                     55,183,000
   Other                                           2,660,774,000
                                                 ---------------
      TOTAL ASSETS                                $3,860,997,000
                                                 ===============

   Postpetition Liabilities
   Accounts Payable                                  101,854,000
   Taxes Payable                                     438,602,000
   Notes Payable                                               -
   Professional Fees                                   1,398,000
   Secured Debt                                      483,307,000
   Due to Affiliates & Insiders                      203,658,000
   Other                                             450,412,000
                                                 ---------------
      Total Postpetition Liabilities               1,679,231,000
                                                 ---------------
   Secured Debt - Per Plan                                     -
   Priority Debt - Per Plan                                    -
   Unsecured Debt - Per Plan                                   -
   Other - Per Plan                                            -
                                                 ---------------
      Total Prepetition Liabilities                            -
                                                 ---------------
      Total Liabilities                            1,679,231,000
                                                 ---------------
   Equity
   Common Stock                                          564,000
   Additional Paid in Capital                      2,009,338,000
   Retained Earnings (Deficit)                        51,521,000
   Accumulated Other Comprehensive Income            120,343,000
                                                 ---------------
      Total Equity (Deficit)                       2,181,766,000
                                                 ---------------
      TOTAL LIABILITIES & OWNERS EQUITY           $3,860,997,000
                                                 ===============


                    Armstrong World Industries, Inc.
                   Unaudited Statement of Cash Flows
                    For the quarter ended June 2008

Cash flows from operating activities:
   Net earnings                                          $23,000
   Adjustments to reconcile net earnings to net cash
   provided by (used for) operating activities:
      Gain on sale of fixed asset                              -
      Depreciation and amortization                   24,241,000
      Deferred income taxes                           21,769,000
      Stock-based compensation                         3,528,000
   Changes in operating assets and liabilities:
      (Increase) decrease in receivables              (2,795,000)
      (Increase) decrease in inventories               3,692,000
      (Increase) decrease in intercompany activity   (24,392,000)
      (Increase) decreae in other current assets       2,419,000
      (Increase) decrease in other noncurrent assets (16,261,000)
      (Increase) decrease in accounts payable and
      accrued expenses                                 6,070,000
      Increase (decrease) in income taxes payable     (2,471,000)
      Increase (decrease) in other long-term
      liabilities                                     (3,420,000)
   Other                                                 301,000
                                                 ---------------
Net cash provided by operating activities            12,704,000
                                                 ---------------
Cash flows from investing activities:
   Purchases of property, plant and equipment         (7,527,000)
   Investment in computer software                    (1,311,000)
   Proceeds from the sale of assets                            -
   Return of capital from subsiddiaries                        -
   Other                                                       -
                                                 ---------------
Net cash provided by investing activities            (8,838,000)
                                                 ---------------
Cash flows from financing activities:
   Increase in postpetition short-term debt                    -
   Decrease in postpetition long-term debt            (4,245,000)
   Dividends paid                                              -
   Other, net                                                  -
                                                 ---------------
Net cash provided by finacing activities             (4,245,000)
                                                 ---------------
Net increase in cash and cash equivalents              (379,000)
                                                 ---------------
Cash and cash equivalents at beginning of period     30,890,000
                                                 ---------------
Cash and cash equivalents at end of period          $30,511,000
                                                 ===============

Headquartered in Lancaster, Pennsylvania, Armstrong World
Industries, Inc. (NYSE:AWI) -- http://www.armstrong.com/--  
designs, manufactures and sells flooring products and ceiling
systems around the world.  It also designs, manufactures and sells
kitchen and bathroom cabinets.  Its business segments include
resilient flooring, wood flooring, building products and cabinets.  
On Dec. 6, 2000, it filed a voluntary petition for relief under
Chapter 11 of the United States Bankruptcy Code in the United
States Bankruptcy Court.  

An earlier version of Armstrong's Plan was confirmed by the
Bankruptcy Court in November 2003.  The District Court for the
District of Delaware did not affirm the confirmation of the Plan,
finding that the proposed distribution of new warrants to the
class of Equity Interest Holders over the objection of the class
of Unsecured Creditors violated the "fair and equitable"
requirement of Section 1129(b)(2)(B)(ii) of the Bankruptcy Code, a
codification of the  absolute priority rule.  Armstrong lost on
appeal before the Third Circuit Court of Appeals.

Armstrong filed a modified plan in February 2006, revising the
classification and treatment of Equity Interests to eliminate the
distribution of warrants to shareholders of AWI's parent company,
Armstrong Holdings, Inc.  Armstrong and the asbestos
constituencies in its case also asked the District Court to find
that the Debtors' present and future liability on account of
asbestos-related personal injury claims is not less than $3.1
billion, and, therefore, Armstrong's chapter 11 plan does not
unfairly discriminate against commercial creditors and should be
confirmed.

The Plan was confirmed by the District Court on August 14, 2006,
and Armstrong emerged from Chapter 11 on October 2, 2006.

Nitram and Desseaux also filed their Chapter 11 cases on
December 6, 2000. The Bankruptcy Court confirmed their First
Amended Joint Plan of Liquidation on December 17, 2007.

STEPHEN KAROTKIN, ESQ., at Weil, Gotshal & Manges, in New York,
JASON M. MADRON, ESQ., at Richards, Layton & Finger, P.A., in
Wilmington, Delaware, represented the Debtors.  STEPHEN J.
SHIMSHAK, ESQ., JOHN F. BAUGHMAN, ESQ., and ANDREW N. GORDON,
ESQ., at Paul, Weiss, Rifkind, Wharton & Garrison, LLP, in New
York, represented the Unsecured Creditors Committee.  ELIHU
INSELBUCH, ESQ., and NATHAN D. FINCH, ESQ., at Caplin & Drysdale
Chartered, in Washington, DC, represented the Asbestos Claimants
Committee.  JANE W. PARVER, ESQ., at Kaye Scholer, LLP, in New
York, represented Dean Trafelet, the future claimants
representative.

On April 3, 2006, Armstrong World acquired HomerWood Inc.  On
May 1, 2006, it acquired Capella Engineered Wood LLC, and its
parent company, Capella Inc.  On March 27, 2007, it entered into
an agreement to sell the principal operating companies in its
European textile and sports flooring business segment to
Tapijtfabriek H. Desseaux N.V. and its subsidiaries.  These
businesses were classified as discontinued at Oct. 2, 2006.    
(Armstrong Bankruptcy News; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


ARMSTRONG WORLD: Nitram Files Report for June 2008 Quarter
----------------------------------------------------------

                          Nitram Liquidators, Inc.
                           Unaudited Balance
Sheet                           
                                                                             
                              As of June 2008

      Assets
      Cash (Unrestricted)                                    $-
      Cash (Restricted)                                  99,208
      Accounts Receivable (Net)                               -
      Inventory                                               -
      Notes Receivable                                        -
      Prepaid Expenses                                        -
      Other                                                   -
                                                    -----------
         Total Current Assets                            99,208
                                                    -----------
      Property, Plant & Equipment
      Real Property & Improvements                            -
      Machinery & Equipment                                   -
      Furniture, Fixtures & Office Equipment                  -
      Vehicles                                                -
      Leasehold Improvements                                  -
      Less: Accumulated Deprec/Depletion                      -
                                                    -----------
         Total Property, Plant & Equipment                    -
                                                    -----------
      Due from Affiliates & Insiders                    953,518
      Other                                                   -
                                                    -----------
            Total Assets                             $1,052,726
                                                    ===========

      Postpetition Liabilities
      Accounts Payable                                      481
      Taxes Payable                                           -
      Notes Payable                                           -
      Professional Fees                                       -
      Secured Debt                                            -
      Due to Affiliates & Insiders                    8,263,685
      Other - Investment in Subsidiary                        -
                                                    -----------
         Total Postpetition Liabilities               8,264,166
                                                    -----------
      Secured Debt - Per Plan                                 -
      Priority Debt - Per Plan                                -
      Unsecured Debt - Per Plan                          94,941
      Other - Per Plan                                        -
                                                    -----------
         Total Prepetition Liabilities                   94,941
                                                    -----------
            Total Liabilities                         8,359,107
                                                    -----------
      Equity
      Common Stock                                        1,000
      Cumulative Dividends                            2,680,402
      Paid in Capital                                 3,459,000
      Retained Earnings (Deficit)                   (13,446,782)
                                                    -----------
         Total Equity (Deficit)                      (7,306,380)

-----------              
                                       
         Total Liabilities & Owner's Equity          $1,052,726
                                                    ===========

Headquartered in Lancaster, Pennsylvania, Armstrong World
Industries, Inc. (NYSE:AWI) -- http://www.armstrong.com/--  
designs, manufactures and sells flooring products and ceiling
systems around the world.  It also designs, manufactures and sells
kitchen and bathroom cabinets.  Its business segments include
resilient flooring, wood flooring, building products and cabinets.  
On Dec. 6, 2000, it filed a voluntary petition for relief under
Chapter 11 of the United States Bankruptcy Code in the United
States Bankruptcy Court.  

An earlier version of Armstrong's Plan was confirmed by the
Bankruptcy Court in November 2003.  The District Court for the
District of Delaware did not affirm the confirmation of the Plan,
finding that the proposed distribution of new warrants to the
class of Equity Interest Holders over the objection of the class
of Unsecured Creditors violated the "fair and equitable"
requirement of Section 1129(b)(2)(B)(ii) of the Bankruptcy Code, a
codification of the  absolute priority rule.  Armstrong lost on
appeal before the Third Circuit Court of Appeals.

Armstrong filed a modified plan in February 2006, revising the
classification and treatment of Equity Interests to eliminate the
distribution of warrants to shareholders of AWI's parent company,
Armstrong Holdings, Inc.  Armstrong and the asbestos
constituencies in its case also asked the District Court to find
that the Debtors' present and future liability on account of
asbestos-related personal injury claims is not less than $3.1
billion, and, therefore, Armstrong's chapter 11 plan does not
unfairly discriminate against commercial creditors and should be
confirmed.

The Plan was confirmed by the District Court on August 14, 2006,
and Armstrong emerged from Chapter 11 on October 2, 2006.

Nitram and Desseaux also filed their Chapter 11 cases on
December 6, 2000. The Bankruptcy Court confirmed their First
Amended Joint Plan of Liquidation on December 17, 2007.

STEPHEN KAROTKIN, ESQ., at Weil, Gotshal & Manges, in New York,
JASON M. MADRON, ESQ., at Richards, Layton & Finger, P.A., in
Wilmington, Delaware, represented the Debtors.  STEPHEN J.
SHIMSHAK, ESQ., JOHN F. BAUGHMAN, ESQ., and ANDREW N. GORDON,
ESQ., at Paul, Weiss, Rifkind, Wharton & Garrison, LLP, in New
York, represented the Unsecured Creditors Committee.  ELIHU
INSELBUCH, ESQ., and NATHAN D. FINCH, ESQ., at Caplin & Drysdale
Chartered, in Washington, DC, represented the Asbestos Claimants
Committee.  JANE W. PARVER, ESQ., at Kaye Scholer, LLP, in New
York, represented Dean Trafelet, the future claimants
representative.

On April 3, 2006, Armstrong World acquired HomerWood Inc.  On
May 1, 2006, it acquired Capella Engineered Wood LLC, and its
parent company, Capella Inc.  On March 27, 2007, it entered into
an agreement to sell the principal operating companies in its
European textile and sports flooring business segment to
Tapijtfabriek H. Desseaux N.V. and its subsidiaries.  These
businesses were classified as discontinued at Oct. 2, 2006.    
(Armstrong Bankruptcy News; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


ARMSTRONG WORLD: Desseaux Files Report for June 2008 Quarter
------------------------------------------------------------

                 Desseaux Corporation of North America
                         Unaudited Balance
Sheet                             
                                                                            
                            As of June 2008

      Assets
      Cash (Unrestricted)                                    $-
      Cash (Restricted)                                       -
      Accounts Receivable (Net)                             840
      Inventory                                               -
      Notes Receivable                                        -
      Prepaid Expenses                                        -
      Other                                                   -

-----------              
                                       
         Total Current Assets                               840

-----------              
                                       
      Property, Plant & Equipment
      Real Property & Improvements                            -
      Machinery & Equipment                                   -
      Furniture, Fixtures & Office Equipment                  -
      Vehicles                                                -
      Leasehold Improvements                                  -
      Less: Accumulated Deprec/Depletion                      -

-----------              
                                       
         Total Property, Plant & Equipment                    -

-----------              
                                       
      Due from Affiliates & Insiders                          -
      Other - Investment in Subsidiary                3,885,354

-----------              
                                       
            Total Assets                             $3,886,194
                                                    ===========
      Postpetition Liabilities
      Accounts Payable                                        -
      Taxes Payable                                      43,940
      Notes Payable                                   2,964,500
      Professional Fees                                       -
      Secured Debt                                            -
      Due to Affiliates & Insiders                      953,520
      Other                                                   -

-----------              
                                       
         Total Postpetition Liabilities               3,961,960

-----------              
                                       
      Secured Debt - Per Plan                                 -
      Priority Debt - Per Plan                                -
      Unsecured Debt - Per Plan                               -
      Other - Per Plan                                        -

-----------              
                                       
         Total Prepetition Liabilities                        -

-----------              
                                       
            Total Liabilities                                 -

-----------              
                                       
      Equity
      Common Stock                                        1,000
      Paid in Capital                                 2,499,000
      Retained Earnings (Deficit)                    (2,575,766)

-----------              
                                       
         Total Equity (Deficit)                         (75,766)

-----------              
                                       
         Total Liabilities & Owners Equity           $3,886,194
                                                    ===========

Headquartered in Lancaster, Pennsylvania, Armstrong World
Industries, Inc. (NYSE:AWI) -- http://www.armstrong.com/--  
designs, manufactures and sells flooring products and ceiling
systems around the world.  It also designs, manufactures and sells
kitchen and bathroom cabinets.  Its business segments include
resilient flooring, wood flooring, building products and cabinets.  
On Dec. 6, 2000, it filed a voluntary petition for relief under
Chapter 11 of the United States Bankruptcy Code in the United
States Bankruptcy Court.  

An earlier version of Armstrong's Plan was confirmed by the
Bankruptcy Court in November 2003.  The District Court for the
District of Delaware did not affirm the confirmation of the Plan,
finding that the proposed distribution of new warrants to the
class of Equity Interest Holders over the objection of the class
of Unsecured Creditors violated the "fair and equitable"
requirement of Section 1129(b)(2)(B)(ii) of the Bankruptcy Code, a
codification of the  absolute priority rule.  Armstrong lost on
appeal before the Third Circuit Court of Appeals.

Armstrong filed a modified plan in February 2006, revising the
classification and treatment of Equity Interests to eliminate the
distribution of warrants to shareholders of AWI's parent company,
Armstrong Holdings, Inc.  Armstrong and the asbestos
constituencies in its case also asked the District Court to find
that the Debtors' present and future liability on account of
asbestos-related personal injury claims is not less than $3.1
billion, and, therefore, Armstrong's chapter 11 plan does not
unfairly discriminate against commercial creditors and should be
confirmed.

The Plan was confirmed by the District Court on August 14, 2006,
and Armstrong emerged from Chapter 11 on October 2, 2006.

Nitram and Desseaux also filed their Chapter 11 cases on
December 6, 2000. The Bankruptcy Court confirmed their First
Amended Joint Plan of Liquidation on December 17, 2007.

STEPHEN KAROTKIN, ESQ., at Weil, Gotshal & Manges, in New York,
JASON M. MADRON, ESQ., at Richards, Layton & Finger, P.A., in
Wilmington, Delaware, represented the Debtors.  STEPHEN J.
SHIMSHAK, ESQ., JOHN F. BAUGHMAN, ESQ., and ANDREW N. GORDON,
ESQ., at Paul, Weiss, Rifkind, Wharton & Garrison, LLP, in New
York, represented the Unsecured Creditors Committee.  ELIHU
INSELBUCH, ESQ., and NATHAN D. FINCH, ESQ., at Caplin & Drysdale
Chartered, in Washington, DC, represented the Asbestos Claimants
Committee.  JANE W. PARVER, ESQ., at Kaye Scholer, LLP, in New
York, represented Dean Trafelet, the future claimants
representative.

On April 3, 2006, Armstrong World acquired HomerWood Inc.  On
May 1, 2006, it acquired Capella Engineered Wood LLC, and its
parent company, Capella Inc.  On March 27, 2007, it entered into
an agreement to sell the principal operating companies in its
European textile and sports flooring business segment to
Tapijtfabriek H. Desseaux N.V. and its subsidiaries.  These
businesses were classified as discontinued at Oct. 2, 2006.    
(Armstrong Bankruptcy News; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


ASARCO LLC: Insurers Object to Plan Confirmation Timeline
---------------------------------------------------------
Certain insurers protest the plan confirmation schedule fixed by
ASARCO LLC and its debtor-affiliates, saying that it doesn't give
them enough time to determine which of the two competing plans of
reorganization filed in the Debtors' Chapter 11 cases is more
viable.

The Debtors have told the U.S. Bankruptcy Court for the Southern
District of Texas that it is likely that at the confirmation
hearing, there will be a trial to consider various parties'
assertions regarding a proper reorganization.  The trial,
according to Judith W. Ross, Esq., at Baker Botts, L.L.P.,
in Dallas, Texas, will be intensive and will involve significant
discovery and motion practice.  As a result, the Debtors have
determined that the Court and all parties will benefit from the
establishment of certain deadlines and procedures that will
create an organized process to address discovery and other
disputes in connection with the confirmation.

Establishing a transparent and clearly articulated discovery
process now will afford creditors maximum notice of the
confirmation process, provide a smooth path toward the Debtors'
exit from Chapter 11, ensure meaningful participation of all key
stakeholders, limit opportunities for unnecessary delay, and
avoid wasting the Court's time with deadline issues in the
future, Ms. Ross contended.

The Debtors have asked the Court to set these deadlines in
connection with the Confirmation Hearing on the Plan:

   Sept. 25, 2008 -- Deadline for parties to serve a notice of
                     intention to participate in confirmation
                     discovery

   Sept. 26, 2008 -- Deadline for Debtors to file a list of
                     parties entitled to participate in all
                     confirmation discovery

                  -- Deadline for parties to file discovery
                     requests

   Oct. 3, 2008   -- Deadline for parties to serve responses and
                     objections to timely confirmation discovery
                     requests

   Oct. 10, 2008  -- Deadline for parties to produce all
                     non-objectionable and non-privileged
                     documents responsive to timely confirmation
                     discovery requests

   Oct. 14, 2008  -- Deadline for parties to file and serve a list
                     of all witnesses whose testimony is to be
                     presented at the Confirmation Hearing

   Oct. 15, 2008  -- Deadline for parties to identify the
                     witnesses who they wish to depose in
                     connection with the Confirmation Hearing

   Oct. 17, 2008  -- Deadline for parties to reach agreement on
                     the date, time, and place at which the
                     deposition of each witness will be held

   Oct. 20, 2008  -- Commencement of depositions of fact witnesses

   Oct. 24, 2008  -- Deadline for parties to file expert reports

   Oct. 31, 2008  -- Deadline for parties to file rebuttal expert
                     reports

   Nov. 3, 2008   -- Depositions of expert witnesses

   Nov. 7, 2008   -- Conclusion of deposition of expert witnesses

   Nov. 17-21,
   and 24-26      -- Confirmation Hearing

To further facilitate an orderly process toward confirmation, the
Discovery Order requires that the Debtors and Asarco Incorporated
file and serve their responses to any Plan Objections on or
before the third business day preceding the commencement of the
Confirmation Hearing and that, to resolve certain trial issues,
the Court will conduct a pre-Confirmation Status Conference two
business days prior to the commencement of the Confirmation
Hearing or as soon thereafter as counsel may be heard.

         Insurance Companies Object to Proposed Schedule

Mt. McKinley Insurance Company and Everest Reinsurance Company
object to the proposed plan confirmation schedule because it does
not give them meaningful or adequate opportunity to conduct
discovery regarding the two competing plans of reorganization.

Based on a review of the Plan filed by the Debtors, the Insurance
Companies note that the Debtors intend for the Asbestos Trust to
be funded, at least in part, through the proceeds of insurance
policies issued by the Insurance Companies even though they have
resolved all their obligations under those insurance policies
through prepetition settlement agreements.

The Insurance Companies complain that the Debtors intend for the
Plan and the confirmation process to (i) assign the MMIC
insurance policies to the Asbestos Trust, (ii) assign and grant
to the Asbestos Trust all rights afforded an insured under the
insurance policies, and (iii) generate rulings and findings that
will significantly prejudice the Insurance Companies' rights in
any subsequent coverage litigation.

                          About ASARCO LLC

Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/--     
is an integrated copper mining, smelting and refining company.
Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent.

The Company filed for Chapter 11 protection on Aug. 9, 2005
(Bankr. S.D. Tex. Case No. 05-21207).  James R. Prince, Esq., Jack
L. Kinzie, Esq., and Eric A. Soderlund, Esq., at Baker Botts
L.L.P., and Nathaniel Peter Holzer, Esq., Shelby A. Jordan, Esq.,
and Harlin C. Womble, Esq., at Jordan, Hyden, Womble & Culbreth,
P.C., represent the Debtor in its restructuring efforts.  Lehman
Brothers Inc. provides the ASARCO with financial advisory services
and investment banking services.  Paul M. Singer, Esq., James C.
McCarroll, Esq., and Derek J. Baker, Esq., at Reed Smith LLP give
legal advice to the Official Committee of Unsecured Creditors and
David J. Beckman at FTI Consulting, Inc., gives financial advisory
services to the Committee.

When the Debtor filed for protection from its creditors, it listed
$600 million in total assets and $1 billion in total debts.

The Debtor has five affiliates that filed for chapter 11
protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521
through 05-20525).  They are Lac d'Amiante Du Quebec Ltee, CAPCO
Pipe Company, Inc., Cement Asbestos Products Company, Lake
Asbestos of Quebec, Ltd., and LAQ Canada, Ltd.  Sander L.
Esserman, Esq., at Stutzman, Bromberg, Esserman & Plifka, APC, in
Dallas, Texas, represents the Official Committee of Unsecured
Creditors for the Asbestos Debtors.  Former judge Robert C. Pate
has been appointed as the future claims representative.  Details
about their asbestos-driven Chapter 11 filings have appeared in
the Troubled Company Reporter since April 18, 2005.

Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle,
Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No. 05-
21346) also filed for chapter 11 protection, and ASARCO has asked
that the three subsidiary cases be jointly administered with its
chapter 11 case.  On Oct. 24, 2005, Encycle/Texas' case was
converted to a Chapter 7 liquidation proceeding.  The Court
appointed Michael Boudloche as Encycle/Texas, Inc.'s Chapter 7
Trustee.  Michael B. Schmidt, Esq., and John Vardeman, Esq., at
Law Offices of Michael B. Schmidt represent the Chapter 7 Trustee.

ASARCO's affiliates, AR Sacaton LLC, Southern Peru Holdings LLC,
and ASARCO Exploration Company Inc., filed for Chapter 11
protection on Dec. 12, 2006.  (Bankr. S.D. Tex. Case No. 06-20774
to 06-20776).

Six of ASARCO's affiliates, Wyoming Mining & Milling Co., Alta
Mining & Development Co., Tulipan Co., Inc., Blackhawk Mining &
Development Co., Ltd., Peru Mining Exploration & Development Co.,
and Green Hill Cleveland Mining Co. filed for Chapter 11
protection on April 21, 2008.  (Bank. S.D. Tex. Case No. 08-20197
to 08-20202).

The Debtors submitted to the Court a joint plan of reorganization
and disclosure statement on July 31, 2008.  The plan incorporates
the sale of substantially all of the Debtors' assets to Sterlite
Industries, Ltd., for $2,600,000,000.

Americas Mining Corporation, an affiliate of Grupo Mexico SAB de
CV, submitted a reorganization plan to retain its equity interest
in ASARCO LLC, by offering full payment to ASARCO's creditors in
connection with ASARCO's Chapter 11 case.  AMC would provide up to
$2.7 billion in cash as well as a $440 million guarantee to assure
payment of all allowed creditor claims, including payment of
liabilities relating to asbestos and environmental claims.  AMC's  
plan is premised on the estimation of the approximate allowed
amount of the claims against ASARCO.

Asarco Inc. and AMC are represented by Luc A. Despins, Esq., at
Milbank, Tweed, Hadley & McCloy LLP, in New York.

(ASARCO Bankruptcy News Issue No. 82; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).


ASARCO LLC: Settles Tacoma Park District Claim for $5 Million
-------------------------------------------------------------
ASARCO LLC asks the U.S. Bankruptcy Court for the Southern
District of New York to approve a settlement it entered into with
The Metropolitan Park District of Tacoma, in Washington, resolving
the Park's Claim No. 5223 relating to ASARCO's former Tacoma
smelter site.

The settlement entitles Metro Park a $5,000,000 allowed general
unsecured claim.  Metro Parks agrees that any and all obligations
or liabilities related to the prepetition Definitive Agreement it
entered into with ASARCO, the city of Tacoma, and the town of
Ruston, Washington, are fully resolved and satisfied.

The settlement, however, does not resolve the issues arising from
the Plan Definition Report dated Sept. 16, 1996, and the Master
Development Plan dated Aug. 26, 1997, related to the remediation
and redevelopment of former Tacoma Smelter Site, the slag
peninsula, and adjacent property owned or managed by Metro Parks.

Metro Parks releases and covenants not to sue or assert claims or
causes of actions against the Debtors.  ASARCO and Metro Parks
participated in a series of mediation regarding the Claim.

                          About ASARCO LLC

Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/--     
is an integrated copper mining, smelting and refining company.
Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent.

The Company filed for Chapter 11 protection on Aug. 9, 2005
(Bankr. S.D. Tex. Case No. 05-21207).  James R. Prince, Esq., Jack
L. Kinzie, Esq., and Eric A. Soderlund, Esq., at Baker Botts
L.L.P., and Nathaniel Peter Holzer, Esq., Shelby A. Jordan, Esq.,
and Harlin C. Womble, Esq., at Jordan, Hyden, Womble & Culbreth,
P.C., represent the Debtor in its restructuring efforts.  Lehman
Brothers Inc. provides the ASARCO with financial advisory services
and investment banking services.  Paul M. Singer, Esq., James C.
McCarroll, Esq., and Derek J. Baker, Esq., at Reed Smith LLP give
legal advice to the Official Committee of Unsecured Creditors and
David J. Beckman at FTI Consulting, Inc., gives financial advisory
services to the Committee.

When the Debtor filed for protection from its creditors, it listed
$600 million in total assets and $1 billion in total debts.

The Debtor has five affiliates that filed for chapter 11
protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521
through 05-20525).  They are Lac d'Amiante Du Quebec Ltee, CAPCO
Pipe Company, Inc., Cement Asbestos Products Company, Lake
Asbestos of Quebec, Ltd., and LAQ Canada, Ltd.  Sander L.
Esserman, Esq., at Stutzman, Bromberg, Esserman & Plifka, APC, in
Dallas, Texas, represents the Official Committee of Unsecured
Creditors for the Asbestos Debtors.  Former judge Robert C. Pate
has been appointed as the future claims representative.  Details
about their asbestos-driven Chapter 11 filings have appeared in
the Troubled Company Reporter since April 18, 2005.

Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle,
Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No. 05-
21346) also filed for chapter 11 protection, and ASARCO has asked
that the three subsidiary cases be jointly administered with its
chapter 11 case.  On Oct. 24, 2005, Encycle/Texas' case was
converted to a Chapter 7 liquidation proceeding.  The Court
appointed Michael Boudloche as Encycle/Texas, Inc.'s Chapter 7
Trustee.  Michael B. Schmidt, Esq., and John Vardeman, Esq., at
Law Offices of Michael B. Schmidt represent the Chapter 7 Trustee.

ASARCO's affiliates, AR Sacaton LLC, Southern Peru Holdings LLC,
and ASARCO Exploration Company Inc., filed for Chapter 11
protection on Dec. 12, 2006.  (Bankr. S.D. Tex. Case No. 06-20774
to 06-20776).

Six of ASARCO's affiliates, Wyoming Mining & Milling Co., Alta
Mining & Development Co., Tulipan Co., Inc., Blackhawk Mining &
Development Co., Ltd., Peru Mining Exploration & Development Co.,
and Green Hill Cleveland Mining Co. filed for Chapter 11
protection on April 21, 2008.  (Bank. S.D. Tex. Case No. 08-20197
to 08-20202).

The Debtors submitted to the Court a joint plan of reorganization
and disclosure statement on July 31, 2008.  The plan incorporates
the sale of substantially all of the Debtors' assets to Sterlite
Industries, Ltd., for $2,600,000,000.

Americas Mining Corporation, an affiliate of Grupo Mexico SAB de
CV, submitted a reorganization plan to retain its equity interest
in ASARCO LLC, by offering full payment to ASARCO's creditors in
connection with ASARCO's Chapter 11 case.  AMC would provide up to
$2.7 billion in cash as well as a $440 million guarantee to assure
payment of all allowed creditor claims, including payment of
liabilities relating to asbestos and environmental claims.  AMC's  
plan is premised on the estimation of the approximate allowed
amount of the claims against ASARCO.

Asarco Inc. and AMC are represented by Luc A. Despins, Esq., at
Milbank, Tweed, Hadley & McCloy LLP, in New York.

(ASARCO Bankruptcy News Issue No. 82; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).


ASPEN COMPANY: Case Summary & Two Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: The Aspen Company
        107 Country Lane
        Kathleen, GA 31047  

Bankruptcy Case No.: 08-52378

Chapter 11 Petition Date: August 29, 2008

Court: Middle District of Georgia

Judge: James D. Walker Jr.

Debtors' Counsel: Wesley J. Boyer, Esq.
                  (wjboyer_2000@yahoo.com)
                  Katz, Flatau, Popson and Boyer, LLP
                  355 Cotton Avenue
                  Macon, GA 31201
                  Tel: (478) 742-6481
  
Estimated Assets: $100,000 to $500,000

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

A copy of the Debtor's petition is available for free at:

             http://bankrupt.com/misc/gamb08-52378.pdf


ATHEROGENICS INC: Defaults on 2008 Note Indenture
-------------------------------------------------
AtheroGenics, Inc. a pharmaceutical company focused on the
treatment of chronic inflammatory diseases, said it is not
repaying the Company's 4.5% Convertible Notes due Sept. 2, 2008,
nor will it make its scheduled interest payment on the 2008 Notes
or the 4.5% Convertible Notes due March 1, 2011 (CUSIP 047439AE4).

The Company has been attempting to restructure its 2008 Notes
prior to their maturity, but was unable to agree on a
restructuring on terms acceptable to the Company and the holders
of the 2008 Notes.

In a related move, AtheroGenics has retained Morgan Stanley to
assist it in evaluating restructuring alternatives to its current
capital structure.  Holders of all three series of convertible
notes: the 2008 Notes, the 2011 Notes and the 1.5% Convertible
Notes due February 1, 2012 (CUSIP 047439AD6 and CUSIP 047439AC8)
are invited to contact Morgan Stanley for further information.

"The very large debt burden of the Company has created a
significant impediment to our ability to effectively develop our
primary asset, AGI-1067," said Russell M. Medford, M.D., Ph.D.,
President and Chief Executive Officer of AtheroGenics. "We believe
that our actions [] appropriately account for the interests of the
Company's various stakeholders." Dr. Medford further stated, "We
continue to believe that there is a significant medical need and
commercial opportunity for our novel lead drug candidate, AGI-
1067, which could become the first diabetes treatment with
demonstrated cardiovascular safety and the potential to reduce
serious cardiovascular events."

The Company intends to meet with the U.S. Food and Drug
Administration in the near term to discuss its plans for the
second phase 3 clinical trial of AGI-1067 as a treatment for
type 2 diabetes.

The action resulted in an event of default under the indenture
governing the 2008 Notes and creates an event of default under the
indentures governing the 2011 Notes and the 2012 Notes. The 2011
Notes and 2012 Notes will be immediately due and payable upon the
Company's receipt of written notice from either the trustee for
such notes or the holders of not less than 25% in aggregate
principal amount of each series of notes.  The Company will be
continuing to work with Morgan Stanley to develop a solution that
addresses all of its outstanding notes.

                  CNH Partners, LLC's Statement

CNH Partners, LLC, Tamalpais Asset Management LP, Tang Capital
Partners, LP, and Zazove Associates LLC, which collectively hold
approximately 96% of the outstanding 4 1/2 % Convertible Notes Due
2008 issued by AtheroGenics, Inc., said on Sept. 2 that they
expect, based on conversations with representatives of
AtheroGenics, that AtheroGenics will elect not to repay their debt
under the 08 Notes.

The 2008 Notes matured September 2, 2008, and the principal amount
of approximately $30.5 million was due and payable. According to
AtheroGenic's latest Quarterly Report on Form 10-Q, AtheroGenics
had approximately $66.2 million in cash, cash equivalents, and
short term investments as of June 30, 2008. Moreover, the 08
Noteholders believe additional funds are available at market terms
to fund ongoing operations, including from the 08 Noteholders,
although the 08 Noteholders are not aware that AtheroGenics has
made any attempt to secure such financing.

On Sunday, August 31, 2008, the 08 Noteholders sent AtheroGenics a  
letter and term sheet describing a proposal for a financing that
was rejected by AtheroGenics. This proposal culminated a series of
offers by the 08 Noteholders to provide financing that would have
allowed AtheroGenics to pay its debts in the ordinary course and
continue to pursue its business objectives. The proposal
contemplated that AtheroGenics offer to the holders of all of
AtheroGenics' outstanding debt the opportunity to participate,
pro-rata, in a $39 million financing on market terms, which the 08
Noteholders would backstop to ensure the entire amount would be
funded. The offer was conditioned on the payment of the 08 Notes
in full when due. The 08 Noteholders believe that the proposal
would have permitted AtheroGenics to meet its payment obligations
under the 08 Notes and to meet other short- and long-term goals,
including completion of the development of AGI-1067 through its
second, confirmatory Phase 3 trial, and to avoid defaults of
AtheroGenics' other outstanding debt.

Based in Alpharetta, Georgia, AtheroGenics Inc. (NASDAQ: AGIX) --
http://www.atherogenics.com/-- is a pharmaceutical company that
focuses on the discovery, development and commercialization of
novel drugs for the treatment of chronic inflammatory diseases,
including heart disease (atherosclerosis), rheumatoid arthritis
and asthma.  AtheroGenics also has preclinical programs in
rheumatoid arthritis and asthma utilizing its proprietary vascular
protectant(R) technology.

At March 31, 2008, the company's balance sheet showed total assets
of $82.5 million total liabilities of $291.6 million, resulting
in a total shareholders' deficit of $209.1 million.


ATTICUS CAPITAL: Dismisses Rumors on Liquidation and Shutdown
-------------------------------------------------------------
Gregory Zukerman of the Wall Street Journal reports that officials
of Atticus Capital LLC said that the fund manager is not ceasing
down operations and liquidating its position.

"We've heard these rumors as well and they're not true," the
Wall Street Journal quoted Tim Barakett, founder of Atticus, as
stating.  "We're certainly not liquidating.  In fact we have a
large net cash position and are looking for opportunities to
invest capital."

According to the WSJ, some stocks held by Atticus Capital in
recent months including Burlington Northern Santa Fe Corp., fell
3.7%, Union Pacific, fell 6% and MasterCard Inc., fell 5.9%.

Despite losses of between 25% and 32% in its two main hedge fund
this year, Atticus Capital said investor are sticking with it, the
report relates.

Atticus Capital said it has less than 10% of its capital place in
for redemption for Sept. 30, 2008, adding its flagship, Atticus
Global, has redemption for 3% of its capital, the WSJ reports.

Headquartered in New York, Atticus Capital LLC is an investment
management firm with assets of $13 billion.  The company invests
in global securities markets.


BANK OF AMERICA: Fitch Rates $28.741 Million Class J Trust 'B'
--------------------------------------------------------------
Fitch Ratings expects to assign these ratings to Bank of America
Auto Trust 2008-1:

  -- $1,824,739,000 Class A-1 'F1+';
  -- $1,723,250,000 Class A-2 'AAA';
  -- $1,195,420,000 Class A-3 'AAA';
  -- $383,764,000 Class A-4 'AAA';
  -- $100,000,000 Class A-5 'AAA';
  -- $130,994,000 Class B 'AA';
  -- $19,714,000 Class C 'AA-';
  -- $77,028,000 Class D 'A';
  -- $19,951,000 Class E 'A-';
  -- $90,995,000 Class F 'BBB';
  -- $8,645,000 Class G 'BBB-';
  -- $17,340,000 Class H 'BB';
  -- $20,136,000 Class I 'BB-';
  -- $28,741,000 Class J 'B'.


BARBEQUES GALORE: Grand Hall to Purchase Assets for $12 Million
---------------------------------------------------------------
Grand Hall Enterprises Co. said that it plans to offer $12 million
for 32 of 65 stores of Barbeques Galore Inc. in a September 3-15
auction, Bloomberg News reports.

On Aug. 27, 2008, Barbeques Galore sought approval from the United
States Bankruptcy Court for the Central District of California to
approve a proposed bidding procedures for the sale of its assets
and intellectual property.  But, the Debtor is facing opposition
from its creditors, including (i) BIT Holdings Sixty-Three, Inc.;
(ii) Nut Tree Retail, LLC; (iii) Inland Western Fort Worth
Southwest Crossing L.P.; and (iv) Inland Western San Antonio
Huebner Oaks.

The creditors argue that the Debtor's proposed bidding procedures
failed to provide sufficient notice of any proposed assumption and
assignment of leases, among other things.

To participate in the public auction, bids on the Debtor's assets
together with a deposit in an amount equal to 5% of the purchase
price must be delivered to Pachulski Stang Ziehl & Jones at 10100
Santa Monica Boulevard, Suite 1100 in Los Angeles, California.

During the auction, minimum bid increment is at least $100,000.

In the event the Debtor consummates the sale to another party, the
stalking-horse bidder will be paid a $50,000 break-up fee.

Objections deadline and the auction date weren't disclosed in
court documents submitted to the Court.

                      About Barbeques Galore

Carlsbad, California-based Barbeques Galore Inc. --
http://www.bbqgalore.com/-- owns 65 retail stores selling   
barbeque equipment and supplies.  It has operations in Australia.  
It filed for Chapter 11 on Aug. 15, 2008, (Bank. C.D. Calif. Case
No. 08-16036).  Jeffrey W. Dulberg, Esq., at Pachulski Stang Ziehl
& Jones LLP, represents the Debtor in its restructuring efforts.  
The Debtor listed assets of $10 million to $50 million, and debts
of $10 million to $50 million.


BARE ESCENTUALS: Moody's Lowers Corporate Family Rating to Ba3
--------------------------------------------------------------
Moody's Investors Service upgraded the long term debt ratings of
Bare Escentuals Beauty, Inc's, including the company's corporate
family rating to Ba3 from B1.  Moody's also assigned a speculative
grade liquidity rating of SGL-2.  The outlook is stable.

The upgrade reflects 1) the company's continued strong operating
performance, 2) improved credit metrics, and 3) early success in
diversifying its distribution channel.

"Moody's recognizes Bare's strong growth rate, leading mineral-
based market position in the foundation category, growing brand
identity, and diversified retail distribution," says Moody's Vice
President Janice Hofferber.  Nevertheless, the ratings will remain
constrained by the company's limited track record at current sales
and profitability levels, relatively small scale, limited product
diversification and exposure to competitive activity by other
industry players that have significantly more financial
flexibility, greater bargaining power with customers, and
considerably larger resources available to seek market share gains
in the mineral-based category.

The SGL-2 reflects Bare's strong and consistent cash flow from
operations, modest cash balances and full availability under its
$25 million revolving credit facility which expires February 2011.

These ratings were upgraded/assessments revised:

   -- Corporate family rating to Ba3 from B1;

   -- Probability of default rating to B1 from B2;

   -- $25 million senior secured first-lien revolving credit
      facility due 2011, to Ba3 (LGD2, 29%) from B1 (LGD3, 32%);

   -- $248 million senior secured first-lien term loan facility
      due 2012, to Ba3 (LGD2, 29%) from B1 (LGD3, 32%);

This rating was assigned:

   -- Speculative Grade Liquidity Rating of SGL-2

   -- Outlook is stable.

Bare Escentuals Beauty, Inc. with headquarters in San Francisco,
California is a leading marketer of cosmetics and skin products,
under the Bare Escentuals and MD Formulations brands.  Sales for
the last 12 months ended June 30, 2008 were $550 million.


BEAR STEARNS: Gov't Seeks Stay of SEC Case Againts Cioffi & Tannin
------------------------------------------------------------------
The Office of the U.S. Attorney for the Eastern District of New
York asked the U.S. District Court for the Eastern District of
New York to stay the civil case filed by the Securities and
Exchange Commission against former Bear Stearns fund managers
Ralph Cioffi and Matthew Tannin.

The federal prosecutors want a stay of the SEC's proceedings  
because of the pendency of a parallel criminal case the
prosecutors filed against Messrs. Cioffi and Tannin in the same
Court.  A grand jury investigation is ongoing in the criminal
case, the federal prosecutors told the Court.

According to Patrick Sean Sinclair, Esq., United States Attorney,
in Brooklyn, New York, the same facts are at issue in both the
civil and criminal cases.  He asserted that a stay is necessary
in the civil case to preserve the secrecy of the ongoing grand
jury proceedings.  He related that during the status conference
on the criminal case held June 26, 2008, the federal prosecutors
indicated that it was considering filing additional charges
against Messrs. Cioffi and Tannin.

Mr. Sinclair asserted that a stay is necessary to prevent the
broad civil discovery available in the Civil Case from
circumventing the more limited discovery that will be available
to Messrs. Cioffi and Tannin who have been indicted in the
Criminal Case.  Moreover, he said a stay promotes "judicial
economy."

The federal prosecutors also asked the Court's permission to
intervene pursuant to Rule 24 of the Federal Rules of Civil
Procedure.

Mr. Sinclair said the SEC takes no position on the matter, while
Messrs. Cioffi and Tannin have declined to articulate their
positions with respect to the requested stay.

Both civil and criminal cases are pending before Senior Judge
Frederic Block.

                     SEC & Federal Prosecutors
               Exchange Letters Regarding Discovery

Edward J.M. Little, Esq., at Hughes Hubbard & Reed LLP, in New
York, in a letter, informed Judge Block that Mr. Cioffi have
submitted affidavits of confession of judgment and proposed
judgments by confession.  At Mr. Cioffi's arraignment, Mr. Little
related that Mr. Cioffi agreed to secure $2,000,000 of his
personal recognizance bond by obtaining two $1,000,000 judgment
liens on two different properties in Florida and Vermont and
secure the remainder of his bond with one of his bank accounts.

Mr. Sinclair, in separate letters sent to both Mr. Little and
Mary Ann Sung, Esq., at Brune & Richard, LLP, in New York,
requested the turnover or inspection of additional documents
relating to Messrs. Cioffi and Tannin and the ongoing civil and
criminal cases.

The Discoveries, according to Mr. Sinclair's letter, include a
disk with images of documents obtained in the course of the SEC's
ongoing investigation.  Mr. Sinclair noted that the production
does not include all of the documents in the SEC's possession,
however SEC is still in the process of organizing additional
documents and preparing them to be produced in an electronic
format.

                 E-mails, "The Heart" of Indictment

Mr. Cioffi's e-mails form the "heart of the indictment" against
him and Mr. Tannin, NorthJersey.com said.  Mr. Cioffi, in one of
his e-mails to a Bear Stearns economist, stated, "I'm fearful of
these markets.  It may not be a meltdown for the general economy
but in our world it will be,"  the report quoted.

According to the report, the criminal charges filed against
Messrs. Cioffi and Tannin are the first criminal charges brought
in the subprime securities mess that rocked the U.S. economy and
the latest Wall Street scandal to revolve around e-mails.

According to the report, for prosecutors, e-mails give a
contemporaneous record of discussions about allegedly criminal
activity that in the past would likely have taken place on the
phone or in person -- away from the prying eyes of investigators.

Federal prosecutors assert that Messrs. Cioffi and Tannin's
starkly different communication -- upbeat and encouraging in
public and fearing the worst in private -- depicts a clear fraud
in which worried investors were persuaded to leave their money in
the fund, and sometimes invest more, to their greater cost, the
report said.

Yet, the report said, criminal defense attorneys say that using
e-mails as primary evidence is no slam-dunk, in part because
those messages are often ambiguous, fragmented and lacking in
context.  Defense attorneys interviewed by the newspaper said a
key issue in the case will likely be whether the e-mails reflect
the sender's true, reasoned state of mind, or merely scattered
impulses in a confused, rapidly evolving downward market.

                     About Bear Stearns Funds

Grand Cayman, Cayman Islands-based Bear Stearns High-Grade
Structured Credit Strategies Enhanced Leverage Master Fund Ltd.
and Bear Stearns High-Grade Structured Credit Strategies Master
Fund Ltd. are open-ended investment companies, which sought high
income and capital appreciation relative to the London Interbank
Offered Rate, and designed for long-term investors.

On July 30, 2007, the Funds filed winding up petitions under the
Companies Law (2007 Revision) of the Cayman Islands.  Simon Lovell
Clayton Whicker and Kristen Beighton at KPMG were appointed joint
provisional liquidators.  The joint liquidators filed for Chapter
15 petitions before the U.S. Bankruptcy Court for the Southern
District of New York the next day.  On August 30, 2007, the
Honorable Burton R. Lifland denied the Funds protection under
Chapter 15 of the Bankruptcy Code.

Fred S. Hodara, Esq., Lisa G. Beckerman, Esq., and David F.
Staber, Esq., at Akin Gump Strauss Hauer & Feld LLP, represent the
liquidators in the United States.  The Funds' assets and debts are
estimated to be more than $100,000,000 each.  (Bear Stearns Funds
Bankruptcy News, Issue No. 24; Bankruptcy Creditors' Service Inc.;
http://bankrupt.com/newsstand/or 215/945-7000).


BEAR STEARNS: Majority Supports Judge's Decision, ABI Poll Says
---------------------------------------------------------------
According to an American Bankruptcy Institute's Quick Poll, a
majority of respondents (52%) in a recent ABI Quick Poll agreed
that a bankruptcy court was correct in concluding that two
overseas Bear Stearns hedge funds were not entitled to
recognition under chapter 15 of the U.S. Bankruptcy Code.  
Thirty-eight percent of respondents "strongly agreed" and 14
percent "somewhat agreed" that the court was correct in
determining that the hedge funds had to file under chapter 11 of
the Bankruptcy Code or continue with an overseas liquidation.

Thirty-five percent of respondents, however, thought that the
bankruptcy court erred in not allowing the two overseas Bear
Stearns hedge funds to file under chapter 15 of the Bankruptcy
Code, ABI said.  Twenty-one percent "disagreed strongly" and 14
percent "somewhat disagreed."  Ten percent of respondents did not
know or had no opinion on the issue.

The Honorable Burton R. Lifland of the U.S. Bankruptcy Court for
the Southern District of New York previously denied recognition of
the liquidation proceeding of Bear Stearns High-Grade Structured
Credit Strategies Master Fund, Ltd., and Bear Stearns High-Grade
Structured Credit Strategies Enhanced Leverage Master Fund, Ltd.,
in the Cayman Islands as "foreign main proceeding" under Chapter
15 of the U.S. Bankruptcy Code.  Judge Lifland instructed the
Funds to seek formal Chapter 7 or 11 proceedings before the U.S.
Courts.

The Funds appealed Judge Lifland's order but the U.S. District
Court for the Southern District of New York affirmed Judge
Lifland's decision.  The Funds said they are not lodging an
appeal of the Bankruptcy and District Courts' decision to the
higher court.

Judge Lifland declined to recognize that the two bankrupt Bear
Stearns hedge funds satisfied the requirement established by
Chapter 15 to have a "center of main interest" outside the United
States.  While the two hedge funds were incorporated under Cayman
Island law, none of the funds' employees, managers or investors
were based in the Cayman Islands and that the assets and records
of the two funds were located in the United States, according to
the Judge's ruling.  Despite an appeal by Bear Stearns, the
Bankruptcy Court's ruling was affirmed by a district court that
the two hedge funds would have to either file in the United
States under chapter 11 or liquidate under Cayman law.

                   About Bear Stearns Funds

Grand Cayman, Cayman Islands-based Bear Stearns High-Grade
Structured Credit Strategies Enhanced Leverage Master Fund Ltd.
and Bear Stearns High-Grade Structured Credit Strategies Master
Fund Ltd. are open-ended investment companies, which sought high
income and capital appreciation relative to the London Interbank
Offered Rate, and designed for long-term investors.

On July 30, 2007, the Funds filed winding up petitions under the
Companies Law (2007 Revision) of the Cayman Islands.  Simon Lovell
Clayton Whicker and Kristen Beighton at KPMG were appointed joint
provisional liquidators.  The joint liquidators filed for Chapter
15 petitions before the U.S. Bankruptcy Court for the Southern
District of New York the next day.  On August 30, 2007, the
Honorable Burton R. Lifland denied the Funds protection under
Chapter 15 of the Bankruptcy Code.

Fred S. Hodara, Esq., Lisa G. Beckerman, Esq., and David F.
Staber, Esq., at Akin Gump Strauss Hauer & Feld LLP, represent the
liquidators in the United States.  The Funds' assets and debts are
estimated to be more than $100,000,000 each.  (Bear Stearns Funds
Bankruptcy News, Issue No. 24; Bankruptcy Creditors' Service Inc.;
http://bankrupt.com/newsstand/or 215/945-7000).


BEAR STEARNS: Moody's Cuts Ratings on 142 Tranches of ARM Deals
---------------------------------------------------------------
Moody's Investors Service has downgraded the ratings of 142
tranches from 10 Option ARM transactions issued by Bear Stearns
Mortgage Funding Trust.  Some 24 tranches that were downgraded
remain on review for possible further downgrade.  Additionally, 9
senior tranches were confirmed at Aaa.  The collateral backing
these transactions consists primarily of first-lien, adjustable-
rate, negatively amortizing Alt-A mortgage loans.

Ratings were downgraded, in general, based on higher than
anticipated rates of delinquency, foreclosure, and REO in the
underlying collateral relative to credit enhancement levels.  The
actions described below are a result of Moody's on-going review
process.

Moody's Investors Service also takes action on certain insured
notes as identified below.  The ratings on securities that are
guaranteed or "wrapped" by a financial guarantor is the higher of
a) the rating of the guarantor or b) the published underlying
rating.  The underlying ratings reflect the intrinsic credit
quality of the notes in the absence of the guarantee.  The current
ratings on the below notes are consistent with Moody's practice of
rating insured securities at the higher of the guarantor's
insurance financial strength rating and any underlying rating that
is public.

Complete rating actions are:

Issuer: Bear Stearns Mortgage Funding Trust 2006-AR1

   -- Cl. I-A-2, Downgraded to A2 from Aaa

   -- Cl. I-A-3, Downgraded to Ba3 from Aaa

   -- Cl. I-X, Confirmed at Aaa

   -- Cl. II-A-3, Downgraded to Baa3 from Aaa

   -- Cl. I-B-1, Downgraded to B3 from Ba3; Placed Under Review
      for further Possible Downgrade

   -- Cl. I-B-2, Downgraded to Caa1 from B3

   -- Cl. I-B-3, Downgraded to Caa2 from B3

   -- Cl. I-B-4, Downgraded to Ca from B3

   -- Cl. I-B-5, Downgraded to Ca from B3

   -- Cl. I-B-6, Downgraded to C from Ca

   -- Cl. I-B-7, Downgraded to C from Ca

   -- Cl. II-B-1, Downgraded to B3 from Ba3; Placed Under Review
      for further Possible Downgrade

   -- Cl. II-B-2, Downgraded to Caa2 from B3

   -- Cl. II-B-3, Downgraded to Ca from B3

   -- Cl. II-B-4, Downgraded to C from B3

   -- Cl. II-B-5, Downgraded to C from Ca

Issuer: Bear Stearns Mortgage Funding Trust 2006-AR2

   -- Cl. I-A-2, Downgraded to Aa3 from Aaa

   -- Cl. I-A-3, Downgraded to Ba1 from Aaa

   -- Cl. II-A-2, Downgraded to Aa3 from Aaa

Financial Guarantor: Ambac Assurance Corporation (Aa3 outlook
negative)

Underlying Rating: Ba1

   -- Cl. I-X, Confirmed at Aaa

   -- Cl. I-B-1, Downgraded to B2 from Baa3

   -- Cl. I-B-2, Downgraded to B3 from Ba2; Placed Under Review
      for further Possible Downgrade

   -- Cl. I-B-3, Downgraded to B3 from Ba3; Placed Under Review
      for further Possible Downgrade

   -- Cl. I-B-4, Downgraded to Caa1 from B3

   -- Cl. I-B-5, Downgraded to Ca from B3

   -- Cl. I-B-6, Downgraded to Ca from B3

   -- Cl. I-B-7, Downgraded to Ca from B3

   -- Cl. I-B-8, Downgraded to Ca from B3

   -- Cl. I-B-9, Downgraded to C from Caa1

   -- Cl. II-B-1, Downgraded to B3 from Ba3; Placed Under Review
      for further Possible Downgrade

   -- Cl. II-B-2, Downgraded to Ca from B3

   -- Cl. II-B-3, Downgraded to C from B3

   -- Cl. II-B-4, Downgraded to C from Caa1

   -- Cl. II-B-5, Downgraded to C from Ca

Issuer: Bear Stearns Mortgage Funding Trust 2006-AR3

   -- Cl. I-A-2A, Downgraded to Aa1 from Aaa

   -- Cl. I-A-3, Downgraded to Baa3 from Aaa

Underlying I-A-2B, Downgraded to Aa1 from Aaa

Grantor Trust I-A-2B, Downgraded to Aa1 from Aaa

   -- Cl. II-A-2A, Downgraded to Baa3 from Aaa

Underlying II-A-2B, Downgraded to Baa3 from Aaa

Grantor Trust II-A-2B, Downgraded to Baa3 from Aaa

   -- Cl. II-A-3, Downgraded to B1 from Aaa

   -- Cl. I-B-1, Downgraded to B1 from Baa1

   -- Cl. I-B-2, Downgraded to B3 from Ba2; Placed Under Review
      for further Possible Downgrade

   -- Cl. I-B-3, Downgraded to B3 from Ba3; Placed Under Review
      for further Possible Downgrade

   -- Cl. I-B-4, Downgraded to Caa1 from Ba3

   -- Cl. I-B-5, Downgraded to Caa2 from B3

   -- Cl. I-B-6, Downgraded to Ca from B3

   -- Cl. I-B-7, Downgraded to Ca from B3

   -- Cl. I-B-8, Downgraded to Ca from B3

   -- Cl. I-B-9, Downgraded to C from Caa1

   -- Cl. II-B-1, Downgraded to Caa2 from Ba3

   -- Cl. II-B-2, Downgraded to Ca from B3

   -- Cl. II-B-3, Downgraded to C from Ca

   -- Cl. II-B-4, Downgraded to C from Ca

   -- Cl. II-B-5, Downgraded to C from Ca

Issuer: Bear Stearns Mortgage Funding Trust 2006-AR4

   -- Cl. A-2, Downgraded to Aa3 from Aaa

Financial Guarantor: Ambac Assurance Corporation (Aa3 outlook
negative)

Underlying Rating: Ba1

   -- Cl. B-1, Downgraded to B3 from Ba3; Placed Under Review for
      further Possible Downgrade

   -- Cl. B-2, Downgraded to Ca from B3

   -- Cl. B-3, Downgraded to Ca from B3

   -- Cl. B-4, Downgraded to C from Caa1

   -- Cl. B-5, Downgraded to C from Ca

Issuer: Bear Stearns Mortgage Funding Trust 2006-AR5

   -- Cl. I-A-2, Downgraded to Aa1 from Aaa

   -- Cl. I-A-3, Downgraded to Baa3 from Aaa

   -- Cl. II-A-2, Downgraded to Baa1 from Aaa

   -- Cl. II-A-3, Downgraded to B1 from Aaa

   -- Cl. I-X, Confirmed at Aaa

   -- Cl. I-B-1, Downgraded to B1 from Baa3

   -- Cl. I-B-2, Downgraded to B3 from Ba2

   -- Cl. I-B-3, Downgraded to B3 from Ba3; Placed Under Review
      for further Possible Downgrade

   -- Cl. I-B-5, Downgraded to Caa1 from B3

   -- Cl. I-B-6, Downgraded to Caa3 from B3

   -- Cl. I-B-7, Downgraded to Ca from Caa1

   -- Cl. I-B-8, Downgraded to C from Ca

   -- Cl. I-B-9, Downgraded to C from Ca

   -- Cl. II-B-1, Downgraded to B3 from Ba3; Placed Under Review
      for further Possible Downgrade

   -- Cl. II-B-2, Downgraded to Caa3 from B3

   -- Cl. II-B-3, Downgraded to Ca from B3

   -- Cl. II-B-4, Downgraded to C from Caa1

   -- Cl. II-B-5, Downgraded to C from Ca

Issuer: Bear Stearns Mortgage Funding Trust 2007-AR1

   -- Cl. I-A-3, Downgraded to Baa3 from Aaa

   -- Cl. I-B-1, Downgraded to B1 from Aaa

   -- Cl. I-X, Confirmed at Aaa

   -- Cl. II-A-3, Downgraded to Aa3 from Aaa

   -- Cl. II-A-4, Downgraded to B1 from Aaa

   -- Cl. I-B-2, Downgraded to B2 from Baa1

   -- Cl. I-B-3, Downgraded to B3 from Baa3; Placed Under Review
      for further Possible Downgrade

   -- Cl. I-B-4, Downgraded to B3 from Ba2; Placed Under Review
      for further Possible Downgrade

   -- Cl. I-B-5, Downgraded to Caa1 from Ba3

   -- Cl. I-B-6, Downgraded to Caa2 from B2

   -- Cl. I-B-7, Downgraded to Ca from B2

   -- Cl. I-B-8, Downgraded to Ca from B3

   -- Cl. I-B-9, Downgraded to C from B3

   -- Cl. II-B-1, Downgraded to B3 from Ba3; Placed Under Review
      for further Possible Downgrade

   -- Cl. II-B-2, Downgraded to Caa3 from B3

   -- Cl. II-B-3, Downgraded to Ca from B3

   -- Cl. II-B-4, Downgraded to C from Ca

   -- Cl. II-B-5, Downgraded to C from Ca

Issuer: Bear Stearns Mortgage Funding Trust 2007-AR2, Mortgage
Pass-Through Certificates, Series 2007-AR2

   -- Cl. A-2, Downgraded to A1 from Aaa

   -- Cl. A-3, Downgraded to Ba1 from Aaa

   -- Cl. B-1, Downgraded to B3 from Ba2

   -- Cl. B-2, Downgraded to B3 from Ba3; Placed Under Review for
      further Possible Downgrade

   -- Cl. B-3, Downgraded to Ca from B3

   -- Cl. B-5, Downgraded to C from Ca

Issuer: Bear Stearns Mortgage Funding Trust 2007-AR3

   -- Cl. I-A-3, Downgraded to Baa3 from Aaa

   -- Cl. I-X, Confirmed at Aaa

   -- Cl. II-1A-2, Downgraded to Baa1 from Aaa

   -- Cl. II-1A-3, Downgraded to Ba3 from Aaa

   -- Cl. II-2A-1, Downgraded to Ba1 from Aaa

   -- Cl. I-B-1, Downgraded to B1 from Aa1

   -- Cl. I-B-2, Downgraded to B2 from Baa2

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

   -- Cl. I-B-4, Downgraded to B3 from Ba2; Placed Under Review
      for further Possible Downgrade

   -- Cl. I-B-5, Downgraded to B3 from Ba3; Placed Under Review
      for further Possible Downgrade

   -- Cl. I-B-6, Downgraded to Caa1 from B1

   -- Cl. I-B-7, Downgraded to Caa2 from B2

   -- Cl. I-B-8, Downgraded to Ca from B2

   -- Cl. I-B-9, Downgraded to Ca from B3

   -- Cl. II-B-1, Downgraded to B3 from Ba2; Placed Under Review
for further Possible Downgrade

   -- Cl. II-B-2, Downgraded to Caa2 from Ba3

   -- Cl. II-B-3, Downgraded to Caa3 from B3

   -- Cl. II-B-4, Downgraded to Ca from B3

   -- Cl. II-B-5, Downgraded to Ca from B3

   -- Cl. II-B-6, Downgraded to C from Ca

Issuer: Bear Stearns Mortgage Funding Trust 2007-AR4

   -- Cl. I-X-1, Confirmed at Aaa

   -- Cl. I-X-2, Confirmed at Aaa

   -- Cl. I-B-3, Downgraded to Aa3 from Aa1

   -- Cl. I-B-4, Downgraded to Baa2 from Aa2

   -- Cl. I-B-5, Downgraded to Baa3 from Aa3

   -- Cl. I-B-6, Downgraded to Ba2 from A3

   -- Cl. I-B-7, Downgraded to B3 from Ba1; Placed Under Review
      for further Possible Downgrade

   -- Cl. I-B-8, Downgraded to Caa1 from B3

   -- Cl. I-B-9, Downgraded to Caa3 from B2

   -- Cl. II-B-1, Downgraded to Ba2 from Aa3

   -- Cl. II-B-2, Downgraded to B3 from Baa3; Placed Under Review
      for further Possible Downgrade

   -- Cl. II-B-3, Downgraded to B3 from Ba2; Placed Under Review
      for further Possible Downgrade

   -- Cl. II-B-4, Downgraded to Caa1 from B1

Issuer: Bear Stearns Mortgage Funding Trust 2007-AR5

   -- Cl. I-X-1, Confirmed at Aaa

   -- Cl. I-X-2, Confirmed at Aaa

   -- Cl. II-B-1, Downgraded to A1 from Aaa

   -- Cl. I-B-4, Downgraded to A2 from Aa2

   -- Cl. I-B-5, Downgraded to A3 from Aa3

   -- Cl. I-B-7, Downgraded to Ba1 from A2

   -- Cl. I-B-3, Downgraded to Aa2 from Aa1

   -- Cl. I-B-6, Downgraded to Baa2 from A1

   -- Cl. I-B-8, Downgraded to B1 from Baa3

   -- Cl. I-B-9, Downgraded to B3 from Ba3; Placed Under Review
      for further Possible Downgrade

   -- Cl. II-B-2, Downgraded to Baa3 from Aa1

   -- Cl. II-B-3, Downgraded to Ba3 from A2

   -- Cl. II-B-4, Downgraded to B1 from Baa3

   -- Cl. II-B-5, Downgraded to B3 from Ba3; Placed Under Review
      for further Possible Downgrade


BEATRICE BIODIESEL: Project to Get $30 Million Capital Infusion
---------------------------------------------------------------
Agri Energy Limited (AAE) said in its preliminary final report
filed with the Australian Stock Exchange, that it has entered into
an agreement with an investor for a capital injection of
US$30 million into the group.  The funds are required to meet
corporate and creditor commitments, to finance the start-up of
wholly owned subsidiary Beatrice Biodiesel, LLC's Beatrice
Biodiesel Project and provide working capital.  Once completed,
this will enable AAE to progress the lifting of the suspension of
trading of its securities on the Australian Stock Exchange put in
place earlier this year.

The initial two payments under the capital injection agreement
have been received and support the corporate costs to progress
finalizing the transaction and project operating costs at
Beatrice Biodiesel.

Concurrent with the capital injection agreement, Beatrice
Biodiesel filed for Chapter 11 bankruptcy protection on
Aug. 21, 2008 in the U.S. Bankruptcy Court for the District of
Nebraska.  The filing was deemed necessary to give the company
time to complete the capital injection and protect AAE and all
stakeholders' interests while creditor agreements are put in
place.  AAE is required to file a creditor payment plan and
project start up plan with the courts over the coming weeks in
line with the drawdown schedule under the capital injection
agreement.

As part of the capital injection agreement, AAE will be required
to call a shareholder meeting to consider all aspects of the
transaction including approval of the capital injection.

Once completed, the capital injection will provide AAE with the
pathway to realize the potential of the Beatrice Biodiesel
Project.  The Chapter 11 process gives the group the stability and
time to develop and agree a plan with both the Investor and the
U.S. creditors for meeting claims, recapitalising the business and
realizing cashflow from the operations.

                    About Beatrice Biodiesel

Headquartered in Beatrice, Nebraska, Beatrice Biodiesel LLC --
http://www.beatricebiodieselcam.com/-- produces biofuels from
vegetable oil and animal fats as well as ethanol from sugar and
grains.

The company filed for Chapter 11 bankruptcy protection on
Aug. 21, 2008 (Bankr. D. Nebraska Lead Case No. 08-41927).  John
L. Horan, Esq., at Cline, Williams, Wright, Johnson represent the
Debtor in its restructuring efforts.  The Debtor disclosed
estimated assets of $50 million to $100 million and estimated
debts of $10 million to $50 million.


BLACKBOARD INC: S&P Upgrades Rating on $165MM Sr. Notes to 'B+'
---------------------------------------------------------------
Standard & Poor's Ratings Services raised its issue-level rating
on Blackboard Inc.'s $165 million senior convertible notes to 'B+'
(the same as the corporate credit rating on the company) from 'B-'
as a result of the assignment of a '4' recovery rating to this
debt.

Ratings List

Blackboard Inc.
  Corporate credit rating   B+/Positive/--

Assigned Rating
  Recovery Rating           4

                            To     From
                            --     ----
Revised Rating
  Senior secured debt       B+     B-

The recovery rating of '4', indicates the expectation for average
(30%-50%) recovery in the event of a payment default.

The corporate credit rating reflects the company's narrow business
profile, fragmented and competitive market place, and rapid
growth.  These factors partly are offset by a strengthening
position in a growing niche software market and a significant base
of recurring business.


BLACKHAWK AUTOMOTIVE: Taps CB Richard Ellis as Real Estate Broker
-----------------------------------------------------------------
Blackhawk Automotive Plastics Inc. asks the U.S. Bankruptcy Court
for the Northern District of Ohio for authority to:

  a) employ CB Richard Ellis, Inc. (CBRE) as commercial real   
     property broker, nunc pro tunc to the petition date, upon the
     terms of the Exclusive Sales Listing Agreement with CBRE
     dated Feb. 25, 2008, respecting the Debtor's 23 acres of real
     property located in Mason, Ohio, and

  b) to pay to CBRE a sales commission pursuant to the CBRE
     Listing Agreement equivalent to 6% of the gross purchase
     rice for the real property in the amount of $21,000.

Pursuant to the Court's order dated Aug. 18, 2008, approving the
Debtor's sale of the real property, on Aug. 20, 2008, the Debtor
closed its sale of the real property to Tri-State for the $350,000
purchase price.  In reliance on the CBRE Listing Agreement, CBRE
marketed the real property and identified Tri-State as a
purchaser.  The lenders did not oppose payment of the CBRE
commission from the purchase price.

Anthony Tiefenback, a vice president of CB Richard Ellis, Inc.,
assures the Court that CBRE does not hold or represent any
interest adverse to the Debtor or its estate.  To the best of the
Debtor's knowledge, CBRE is a "disinterested person" as such term
is defined in Sec. 101(14) of the Bankruptcy Code.

                     About Blawkhawk Automotive

Salem, Ohio-based Blackhawk Automotive Plastics Inc., formerly
Warren Molded/Custom Plastics, manufactures injection molded
plastic products and motor vehicle parts and accessories.  BAP's
customers include General Motors, Delphi, Lear, Chrysler, Honda,
Navistar, and Visteon.  BAP employs about 1,574 workers
domestically, and generated $136 million in sales in 2006.

BAP owns Canadian subsidiary, Blackhawk Automotive Plastics Ltd.
which operated a manufacturing facility in Ontario until Johnson
Controls Inc. bought BAP Canada's assets in May 2005.  BAP
Canada's remaining assets consist primarily of net operating loss
carryforwards for Canadian tax purposes.  The NOLs had a book
value of about $8.2 million as of December 2005.  BAP also owns a
plant in Upper Sandusky, Ohio, which ceased operations in 2006.

The company filed for chapter 11 protection on Oct. 22, 2007
(Bankr. N.D. Ohio, Case No. 07-42671).  Its parent company, Tier e
Automotive Group Inc., filed a separate chapter 11 petition on the
same day (Bankr. N.D. Ohio, Case No. 07-42673).

Tier e acquired BAP from Worthington Industries Inc. in 1999.
Tier e also owns 49% stake in Nescor Holdings Inc., a holding
company for Nescor Plastics Corporation, also an automotive
plastics supplier.

William I. Kohn, Esq., David M. Neumann, Esq., Stuart A. Laven,
Jr., Esq., at Benesch, Friedlander, Coplan & Aronoff LLP,
represent the Debtors in their restructuring efforts.  Donlin
Recano & Company Inc. provides the Debtors with claims, noticing,
balloting and distribution services.  The Debtors' schedules
disclosed total assets of $58,665,229 and total liabilities of
$51,244,592.  As of bankruptcy filing, BAP's aggregate debt to its
senior facility lenders was about $33 million.


BLUEPOINT RE: Hearing to Consider Chapter 15 Petition Set Sept. 29
------------------------------------------------------------------
A hearing is set for Sept. 29, 2008, at 9:45 a.m. before Judge
Robert E. Gerber of the U.S. Bankruptcy Court for the Southern
District of New York to consider (i) the Chapter 15 petition filed
for BluePoint Re, Ltd., and its petitioner's request for
recognition of BluePoint's insolvency proceedings in Bermuda as a
foreign main proceeding for a permanent injunction and related
relief; and (ii) the Petitioner's request for a Preliminary
Injunction Order.

The hearing will be at Room 621 of the Bankruptcy Court at One
Bowling Green, New York, N.Y.

The Court has issued an Order to Show Cause with Temporary
Restraining Order.

On August 7, 2008, the Debtor requested and obtained an order from
the Supreme Court of Bermuda to be wound up pursuant to the
Bermuda Companies Act of 1981.  The Bermuda Court also appointed
John C. McKeena as the Debtor's provisional liquidator on the same
day.

BluePoint Re sought for Chapter 15 bankruptcy protection before
the United States Bankruptcy Court for the Southern District of
New York (Bankr. S.D.N.Y. 08-13169) on August 13, 2008.  Mr.  
McKeena filed the Chapter 15 petition on BluePoint's behalf.

Based in Bermuda, the Debtor provides insurance and reinsurance of
all kinds, and in particular to underwrite third party financial
insurance, mostly with underlying risks of structured finance and
municipal transactions.  It is a wholly owned subsidiary of
BluePoint Holdings Ltd. in Bermuda, which in turn is wholly owned
by Wachovia Corp.  The Petitioner's Counsel is Howard Seife, Esq.
at Chadbourne & Parke, LLP.  BluePoint Re's asset is estimated at
more than $100,000,000 and its debts at more than $100,000,000.


BOB LENC: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------
Debtor: Bob Lenc Landscaping Inc.
        dba Landscaping Lighting of Des Moines
        5425 Lower Beaver Rd.
        Des Moines, IA 50310

Bankruptcy Case No.: 08-03353

Type of Business: The Debtor operates a large retail nursery that  
                  provides landscaping solutions and lawn care.

Chapter 11 Petition Date: September 2, 2008

Court: Southern District of Iowa (Des Moines)

Debtor's Counsel: Jeffrey D. Goetz, Esq.
                  (bankruptcyefile@bradshawlaw.com)
                  Bradshaw, Fowler, Proctor & Fairgrave, P.C.
                  801 Grand Ave, Ste 3700
                  Des Moines, IA 50309-8004
                  Tel: (515) 246-5817
                  Fax: (515) 246-5808

Estimated Assets: $1 million to $10 million

Estimated Debts: $1 million to $10 million

A copy of Debtor's petition, which includes a list of its 20
largest unsecured creditors, is available for free at:

              http://bankrupt.com/misc/iasb08-03353.pdf


BRIT ALLIANCE: Fitch Junks Rating on $30 Million Class A Notes
--------------------------------------------------------------
Fitch downgraded and removed from Rating Watch Negative the sole
class of notes issued by Brit Alliance CDOSpoke 2005-X.  These
rating action is effective immediately:

  -- $30,000,000 Class A Notes to 'CCC' from 'BBB'.

This downgrade is a result of significant collateral deterioration
within the reference portfolio, specifically structured finance
collateralized debt obligations and subprime mortgage backed
securities.  Since Fitch's last review of Brit Alliance on
Nov. 12, 2007, approximately 22% of the portfolio has been
downgraded and 19% of the portfolio is currently on Rating Watch
Negative. Of the portfolio, 17% is now rated below investment
grade, of which 8% is rated 'CCC+' and below.

Brit Alliance Finance BV is an unfunded credit default swap
entered into between Morgan Stanley Capital Services, Inc. and
Brit Alliance Finance BV.  The CDS references a $600 million
portfolio consisting of 41% CDOs containing non-SF portfolios, 27%
SF CDOs, and 14% subprime RMBS.  Brit Alliance will exit its
reinvestment period on March 9, 2013.

The class A note attachment point has remained stable at 7.55%
since the last review in November 2007.  However, this is below
the current percentage of assets that are rated 'CCC+' or lower.  
In addition, while there are no credit events officially declared
as of the June 6, 2008 trustee report, current ratings indicate
that rating downgrade credit events may be declared as of the next
trustee report which will adversely affect the transaction.

The rating addresses the likelihood that the floating rate payer
will have to make a protection payment under the terms of the
respective credit default swap.

Fitch is reviewing its SF CDO approach and will comment separately
on any changes and potential rating impact at a later date.  Fitch
will continue to monitor and review this transaction for future
rating adjustments.


CALLIDUS DEBT: S&P Lowers Rating on $18 Mil. Class Notes to 'B-'
----------------------------------------------------------------
Standard & Poor's Ratings Services raised its ratings on the class
A-2 and A-3 notes issued by Callidus Debt Partners CDO Fund I
Ltd., a cash flow arbitrage corporate high-yield collateralized
bond obligation (CBO) transaction, and removed them from
CreditWatch, where theyS&Pre placed with positive implications on
July 28, 2008.  At the same time,S&P lowered our rating on the
class C notes and removed it from CreditWatch negative.

On June 9, 2008,S&P had lowered the ratings assigned to the class
A-2 and A-3 notes to 'AA' from 'AAA' in connection with the
lowering of the financial strength rating on Ambac Assurance Corp.
(Ambac) to 'AA/Watch Neg' from 'AAA'.  S&P are now raising these
ratings in connection with a subsequent review of these classes of
notes without giving benefit to the financial guarantee
policy from Ambac.

The downgrade of class C reflects negative credit migration in the
underlying pool;S&P believe that the credit support available to
the class C notes is not sufficient to sustain the previous
rating.
  
Ratings Raised and Removed From Creditwatch Positive

Callidus Debt Partners CDO Fund I Ltd.

           Rating                    Balance  (mil. $)
Class     To     From              Original    Current
-----     --     ----              --------    -------
A-2       AAA    AA/Watch Pos        264.00     170.78
A-3       AAA    AA/Watch Pos         50.60      32.73

Ratings Raised and Removed From Creditwatch Negative

Callidus Debt Partners CDO Fund I Ltd.

           Rating                    Balance  (mil. $)
Class     To     From              Original    Current
-----     --     ----              --------    -------
C         B-     BB-/Watch Neg        18.80      18.80

Other Outstanding Rating

Callidus Debt Partners CDO Fund I Ltd.

                                     Balance (mil. $)
Class      Rating                   Original    Current
B-2        BBB+                        24.70      24.70


CALPINE CORP: Appoints Thad Hill as EVP and Commercial Officer
--------------------------------------------------------------
Calpine Corporation named Thad Hill as Executive Vice President
and Chief Commercial Officer.  Mr. Hill will have responsibility
for commercial and power operations.  He succeeds Todd W.
Filsinger who was Interim Chief Operating Officer since May 2008.
Mr. Filsinger will return to his responsibilities as a Managing
Partner at PA Consulting Group.

"Thad brings to Calpine valuable industry knowledge and
experience," said Calpine Chief Executive Officer Jack A. Fusco.
"His proven ability to apply his expertise across both commercial
and power operations will make him an important addition to our
executive team."

"I would like to thank Todd for his tireless efforts helping
Calpine during restructuring and since Calpine's emergence from
bankruptcy," added Mr. Fusco.

Thad Hill most recently was Executive Vice President of NRG Energy
since February 2006 and President of NRG Texas since December
2006.  Prior to joining NRG, Mr. Hill was Executive Vice President
of Strategy and Business Development at Texas Genco.  From 1995 to
2005, he was with Boston Consulting Group Inc., where he rose to
Vice President and Director and led the North American energy
practice, serving companies in the power and gas sector with a
focus on commercial and strategic issues.

Mr. Hill received his bachelor of arts degree from Vanderbilt
University magna cum laude and a master of business administration
degree from the Amos Tuck School of Dartmouth College, where he
was elected an Edward Tuck Scholar.

                          About Calpine

Based in San Jose, California, Calpine Corporation (OTC Pink
Sheets: CPNLQ) -- http://www.calpine.com/-- supplies customers
and communities with electricity from clean, efficient, natural
gas-fired and geothermal power plants.  Calpine owns, leases and
operates integrated systems of plants in 21 U.S. states and in
three Canadian provinces.  Its customized products and services
include wholesale and retail electricity, gas turbine components
and services, energy management and a wide range of power plant
engineering, construction and maintenance and operational
services.

The company and its affiliates filed for chapter 11 protection on
Dec. 20, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-60200).  Richard
M. Cieri, Esq., Matthew A. Cantor, Esq., Edward Sassower, Esq.,
and Robert G. Burns, Esq., Kirkland & Ellis LLP represent the
Debtors in their restructuring efforts.  Michael S. Stamer, Esq.,
at Akin Gump Strauss Hauer & Feld LLP, represents the Official
Committee of Unsecured Creditors.  As of Aug. 31, 2007, the
Debtors disclosed total assets of $18,467,000,000, total
liabilities not subject to compromise of $11,207,000,000, total
liabilities subject to compromise of $15,354,000,000 and
stockholders' deficit of $8,102,000,000.

On Feb. 3, 2006, two more affiliates, Geysers Power Company, LLC,
and Silverado Geothermal Resources, Inc., filed voluntary chapter
11 petitions (Bankr. S.D.N.Y. Case Nos. 06-10197 and 06-10198).
On Sept. 20, 2007, Santa Rosa Energy Center, LLC, another
affiliate, also filed a voluntary chapter 11 petition (Bankr.
S.D.N.Y. Case No. 07-12967).

On June 20, 2007, the Debtors filed their Chapter 11 Plan and
Disclosure Statement.  On Aug. 27, 2007, the Debtors filed their
Amended Plan and Disclosure Statement.  Calpine filed a Second
Amended Plan on Sept. 19, 2007 and on Sept. 24, 2007, filed a
Third Amended Plan.  On Sept. 25, 2007, the Court approved the
adequacy of the Debtors' Disclosure Statement and entered a
written order on September 26.  On Dec. 19, 2007, the Court
confirmed the Debtors' Plan.  The Amended Plan was deemed
effective as of Jan. 31, 2008.


CANCER INSTITUTE: Voluntary Chapter 11 Case Summary
---------------------------------------------------
Debtor: Cancer Institute of Southeast Texas, Ltd.
        4600 9th Ave.
        Port Arthur, TX 77642

Bankruptcy Case No.: 08-35875

Chapter 11 Petition Date: September 2, 2008

Court: Southern District of Texas (Houston)

Judge: Karen K. Brown

Debtor's Counsel: Margaret Maxwell McClure, Esq.
                     Email: mccluremar@aol.com
                  909 Fannin, Ste. 3810
                  Houston, TX 77010
                  Tel: (713) 659-1333
                  Fax: (713) 658-0334

Estimated Assets: Unknown

Estimated Debts: Unknown

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


CASTLE ROCK: Voluntary Chapter 11 Case Summary
----------------------------------------------
Debtor: Castle Rock Construction, LLC
        620 North Walnut St.
        Murfreesboro, TN 37130-2854

Bankruptcy Case No.: 08-07945

Type of Business: The Debtor provides construction services.

Chapter 11 Petition Date: September 3, 2008

Court: Middle District of Tennessee (Nashville)

Judge: Keith M. Lundin

Debtor's Counsel: Samuel K. Crocker, Esq.
                     Email: SKCTRUSTEE@aol.com
                  Crocker & Niarhos
                  611 Commerce St., Ste. 2720
                  Nashville, TN 37203
                  Tel: (615) 726-3322
                  Fax: (615) 726-6330

Estimated Assets: $500,000 to $1,000,000

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

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


CHAMBERS PLACE 04: Voluntary Chapter 11 Case Summary
----------------------------------------------------
Debtor: Chambers Place 04, Inc.
        10198 N. Chatfield Dr.
        Littleton, CO 80125-9602

Bankruptcy Case No.: 08-23456

Chapter 11 Petition Date:

Court: District of Colorado (Denver)

Judge: A. Bruce Campbell

Debtor's Counsel: Kenneth J. Buechler, Esq.
                  Email: Ken.Buechler@Sendwass.com
                  1660 Lincoln St., Ste. 2200
                  Denver, CO 80264
                  Tel: (303) 296-1999
                  Fax: (303) 296-7600

Total Assets: $1,680,048

Total Debts: $1,095,840

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


CHRYSLER LLC: August 2008 U.S. Sales Down 34% at 110,235 Units
--------------------------------------------------------------
Chrysler LLC reported total August 2008 U.S. sales of 110,235
units, down 34% from the same period last year.  Total August
sales reflect an industry-wide slowdown, segment shifts and
reduced fleet sales.  Compared with July 2008, Chrysler's August
sales increased 12% supported by enhanced financing offers,
efforts to shift lease-oriented customers to purchasing, leasing
availability from independent financial institutions and better
demand for key vehicles.  Although Chrysler Financial is no longer
offering leasing options to Chrysler customers, customers are
still able to lease Chrysler, Jeep(R) and Dodge products through
independent financial institutions and qualify for available
discounts.

"The industry is changing rapidly in terms of what vehicles and
features customers want and the leasing and financing options
available to them," Jim Press, Chrysler LLC Vice Chairman and
President, said.  "To help consumers, we are offering some of our
most popular vehicles at significant savings.  In August, we saw
this formula generate new signs of momentum on vehicles like our
Chrysler and Dodge minivans, Dodge Ram light-duty trucks and Jeep
Liberty.  In September, we will continue to offer competitive
values and showcase dynamic new vehicles like the 2009 Dodge
Challenger, and hybrid Dodge Durango and Chrysler Aspen SUVs."

                       September Incentives

Chrysler's "Shop 'til You Drive Sales Event" continues through
September 30, offering up to 40% off MSRP on select vehicles, and
zero% APR for 72-months on the 2008 Dodge Ram, Dodge Durango,
Chrysler Aspen, Jeep Grand Cherokee and Jeep Commander.  
Especially strong values are available on Dodge Ram pickup trucks,
with up to $9,000 discounts in select markets.

In September, customers can continue to take advantage of consumer
bonus cash of $2,000 on select retail purchases when financed
through Chrysler Financial.  For those customers who still wish to
lease a Chrysler, Jeep or Dodge vehicle through an independent
financial institution, they can take advantage of Chrysler's
Customer Cash Allowance on select vehicles up to $2,000.

Returning lease customers will receive a Lease Loyalty incentive
up to $750 for use towards the retail purchase of an eligible new
Chrysler, Jeep or Dodge vehicle.  The disposition fee, up to $425,
will be waived by Chrysler Financial.

                      August Sales Highlights

Total Chrysler LLC minivan sales were up 7% compared with a year
ago.  The Dodge Grand Caravan posted sales of 9,422 units, nearly
flat when compared with August 2007 sales.  However, when compared
with July 2008, Grand Caravan sales were up 54%.  The all-new
Chrysler Town & Country posted increased sales of 10,182 units in
August, up 15% compared with August 2007 sales, and up 26% when
compared with July 2008 sales.

Total Dodge Ram light-duty truck sales have doubled in the last 60
days, (June sales 9,172 units vs. August sales 18,774 units).  
Although sales were down 7% when compared with August 2007, sales
increased 16% when compared with July 2008 sales.  The 2009 model
year Dodge Ram will begin arriving in Dodge dealerships in
September.

The all-new 2008 Dodge Journey continues to gain momentum in the
expanding mid-size crossover segment by capturing more than 35% of
its buyers from owners of larger SUVs who are looking for
efficiency and versatility.  More than half of all Dodge Journey
sales were first-time customers to the Dodge Brand.  Journey
posted sales of 4,587 in August, a 33% increase when compared with
July 2008 sales of 3,449 units.

Chrysler LLC sold 4,654 units of the Jeep Liberty in August, a
decrease of 14% when compared with August 2007.  However, the
vehicle picked up some momentum in August, increasing sales 24%
when compared with July 2008 sales.

Sales for the Dodge Charger continue to grow.  In August, 8,102
Dodge Chargers were sold, a 3% increase versus 2007 sales, and a
48% increase compared with July 2008 sales.

The Company finished the month with 380,560 units of inventory, or
a 93-day supply. As part of a planned reduction in manufacturing
and capacity, inventory is down 15% compared with August 2007 when
it totaled 446,249 units.

                       About Chrysler LLC

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

                          *     *     *

As reported in the Troubled Company Reporter on Aug. 11, 2008,
Standard & Poor's Ratings Services said lowered its ratings on
Chrysler LLC, including the corporate credit rating, to 'CCC+'
from 'B-'.

On July 31, 2008, TCR said that Fitch Ratings has downgraded the
Issuer Default Rating of Chrysler LLC to 'CCC' from 'B-'.  The
Rating Outlook is Negative.  The downgrade reflects Chrysler's
restricted access to economic retail financing for its vehicles,
which is expected to result in a further step-down in retail
volumes.  Lack of competitive financing is also expected to result
in more costly subvention payments and other forms of sales
incentives.  Fitch is also concerned with the state of the
securitization market and the ability of the automakers to access
this market on an economic basis over the near term, given the
steep drop in residual values, higher default rates, higher loss
severity being experienced and jittery capital market.


CHRYSLER LLC: Canada Sales for August 2008 Fall 24%
---------------------------------------------------
Chrysler Canada reported sales of 15,548 for the month of August
in 2008, with a positive showing by several key vehicles (August
2007: 20,503).  The company's results calendar-year-to-date
remained stable, with sales of 162,299 for the period January
through August, compared to 162,862 in 2007.

"August sales reflect the shift Canadian buyers are making from a
lease focus to a purchase-oriented automotive market," said Reid
Bigland, President and CEO of Chrysler Canada.  "In spite of the
softening, unprecedented pricing on many of our Chrysler, Jeep(R)
and Dodge products resonated with shoppers and generated solid
sales."

                        August Highlights

The Dodge Ram Light Duty pickup truck posted another very
successful month, achieving sales of 3,131, compared to 2,752 in
2007, an increase of 14%.

"Our Dodge Ram Light Duty pickup truck has experienced phenomenal
success in 2008, with sales up 25% CYTD over the same period last
year," Dave Buckingham, Vice President of Sales, said.  "This is
great news considering that we are bringing an all-new, completely
redesigned light duty Dodge Ram to market later this fall.  With
35 new or improved features, our 2009 Ram is clearly a game-
changer that raises the bar for the competition."

Demand for the Dodge Nitro rose significantly in August, with
sales of 1,047, an increase of 31% compared to the same month in
2007.  Sales of the Dodge Grand Caravan and Chrysler Town &
Country more than doubled over the August 2007 level, with
combined sales of 2,890 (2007: 1,388).

The iconic Jeep Wrangler posted strong sales for the month,
achieving 949 units sold, an increase of 18% over 2007.  Another
Chrysler LLC legend, the Dodge Challenger SRT8(R), has been
building momentum and driving showroom traffic in spite of limited
availability.  The 2009 Dodge Challenger is launching in September
with an increased range of models and powertrains, reaching a
broader spectrum of driving enthusiasts.  The Dodge Challenger SE
will be offered with a fuel-efficient 3.5L V6 which delivers a
highway fuel economy rating of 7.9L/100 km (36 mpg).

Production began in August of the all-new 2009 Chrysler Aspen
Hybrid Electric Vehicle.  The Chrysler Aspen HEV will be available
for sale beginning this fall, and offers seven-passenger seating
combined with a blend of performance, utility, functionality and
significantly improved fuel economy.  Combined with fuel-saving
MDS technology, the advanced, two-mode hybrid technology delivers
an overall improvement of more than 25% in fuel economy and up to
a 40% improvement in the city.

                     September Sales Promotions

For the month of September, Chrysler Canada's incentive program
will focus on aggressive cash positions with competitive monthly
payment options and total discounts up to $13,500.  For example,
the 2008 Dodge Ram 1500 Quad Cab(R) SXT 4 X 4 featuring a HEMI(R)
V8 with fuel-saving Multi-Displacement System, chrome wheels, and
power equipment package is available for $23,898, or $165
bi-weekly.  The Dodge Ram pickup is Chrysler Canada's highest-
selling vehicle.

Total discounts on the 2008 Jeep Wrangler and 4-door Wrangler
Unlimited now equal up to $5,000.  A well-equipped Jeep Wrangler
Sahara with modular hard top, air conditioning, aluminum wheels,
power equipment package and legendary 4 X 4 capability can be
purchased for as little as $155 bi-weekly.

In addition to exceptional pricing, Chrysler Canada is launching
the all-new "We'll Pay Your Way Till 2009" initiative.  Under this
program, Chrysler Canada will cover all monthly purchase or lease
payments up to $1,500 through the end of 2008.  Customers also
have the option of selecting a cash rebate of $1,250.  "We'll pay
your way" is not a payment deferral, but an innovative incentive
plan that covers nearly all 2008 model vehicles (excluding Dodge
Sprinter and Challenger), as well as the 2009 Dodge Caliber, Jeep
Compass, and Jeep Patriot.

                       About Chrysler LLC

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

                          *     *     *

As reported in the Troubled Company Reporter on Aug. 11, 2008,
Standard & Poor's Ratings Services said lowered its ratings on
Chrysler LLC, including the corporate credit rating, to 'CCC+'
from 'B-'.

On July 31, 2008, TCR said that Fitch Ratings has downgraded the
Issuer Default Rating of Chrysler LLC to 'CCC' from 'B-'.  The
Rating Outlook is Negative.  The downgrade reflects Chrysler's
restricted access to economic retail financing for its vehicles,
which is expected to result in a further step-down in retail
volumes.  Lack of competitive financing is also expected to result
in more costly subvention payments and other forms of sales
incentives.  Fitch is also concerned with the state of the
securitization market and the ability of the automakers to access
this market on an economic basis over the near term, given the
steep drop in residual values, higher default rates, higher loss
severity being experienced and jittery capital market.


CHRYSLER LLC: Discloses Leadership Appointments in Finance Office
-----------------------------------------------------------------
Chrysler LLC disclosed a series of leadership appointments in the
company's Finance and Diversity Offices.

Kim Harris Jones is appointed Senior Vice President – Corporate
Controller and Auditor as part of an on-going initiative to
streamline functions for greater organizational efficiency and
drive corporate strategy.  Chrysler also has named Laurie A.
Macaddino Vice President – Finance Operations.

Under this structure, Harris Jones will oversee the consolidation
of the Corporate Controller's office and Audit operations.  She is
responsible for the company's corporate financial activities,
including business planning, short- and medium-term financial
forecasting as well as all internal and external audit functions.

Harris Jones was most recently Vice President and Chief
Controller.  She was recently named to the list of "25 Women to
Watch" by CFO Magazine.  In 2006, she was named the "African
American Executive of the Year" by On Wheels, Inc. and in 2005 was
named to the Automotive News list of "100 Leading Women in the
North American Auto Industry."  She joined Chrysler in 1992.

In her new role, Ms. Macaddino is responsible for ensuring that
all vehicles produced and sold by Chrysler meet financial
requirements, including cost, investment and profitability.  Ms.
Macaddino is also responsible for overseeing Manufacturing,
Engineering, Research and Development budgets.  Ms. Macaddino
formerly was Vice President – Corporate Audit and Compliance.  She
joined the company in 1986.

Also in the Finance organization, Steven E. Bell was appointed
Director – Corporate Audit and Compliance.  He is responsible for
managing the day-to-day internal and external audit functions,
including financial, operational, and process audits, dealer and
supplier audits, business ethics, compliance operations and fraud
and forensic investigations.  Mr. Bell joined the company in 1988.

"[The] announcement allows us to maximize the talents of our
management team," Ronald E. Kolka, Executive Vice President and
Chief Financial Officer, Chrysler LLC, said.  "Both Kim and Laurie
are strong leaders who have made valuable contributions to this
company. Both are strategic thinkers with a keen sense of
financial control.  In their new roles they will bring a laser
focus to their respective areas."

Chrysler LLC also disclosed that Monica E. Emerson, Executive
Director – Corporate Diversity Office, has decided to retire after
33 years with the company.  With Ms. Emerson's departure, Chrysler
has named Lisa J. Wicker, Director – Corporate Diversity.

"Monica has been a true leader and champion in developing
Chrysler's diversity and inclusion in the workplace strategy,"
said Nancy Rae, Executive Vice President – Human Resources and
Communications, Chrysler LLC.  "Through Monica's efforts, the
company has been honored at the highest level—we thank her for her
contributions and wish her the best in her retirement. We have
every confidence that Lisa will continue this legacy."

Ms. Emerson has received several honors including the Leadership
in Diversity Award by the Career Communication Group.  Recently,
she was named to Savoy Professional Magazine's "Top 100 Blacks in
Corporate America."

As Director – Corporate Diversity, Ms. Wicker will be responsible
for the overall design, development and deployment of Chrysler's
corporate diversity strategies.  This includes facilitating short-
and long-term strategies for implementing cultural change in all
aspects of how the company leverages diversity for a competitive
advantage throughout its entire business enterprise.  In addition,
she will be responsible for Equal Employment Opportunity
Commission Compliance and Governance and Work/Life Policies and
Programs.

Ms. Wicker joined the company in 2001 and most recently was Senior
Manager – Manufacturing Group HR, Stamping and Components.

                     About Chrysler LLC

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

                          *     *     *

As reported in the Troubled Company Reporter on Aug. 11, 2008,
Standard & Poor's Ratings Services said lowered its ratings on
Chrysler LLC, including the corporate credit rating, to 'CCC+'
from 'B-'.

On July 31, 2008, TCR said that Fitch Ratings has downgraded the
Issuer Default Rating of Chrysler LLC to 'CCC' from 'B-'.  The
Rating Outlook is Negative.  The downgrade reflects Chrysler's
restricted access to economic retail financing for its vehicles,
which is expected to result in a further step-down in retail
volumes.  Lack of competitive financing is also expected to result
in more costly subvention payments and other forms of sales
incentives.  Fitch is also concerned with the state of the
securitization market and the ability of the automakers to access
this market on an economic basis over the near term, given the
steep drop in residual values, higher default rates, higher loss
severity being experienced and jittery capital market.


CITIBANK NA: Moody's Slashes Rating on $5,100,000 Notes to Ba1
--------------------------------------------------------------
Moody's Investors Service has downgraded the rating of these
notes:

Class Description: Citibank N.A. USD 5,100,000 CDS Reference
Number CA1121771 (Derby Mezzanine 2007 CDO)

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

   -- Current Rating: Ba1

According to Moody's, the rating action is the result of
deterioration in the credit quality of the transaction's
underlying collateral pool, which consists primarily of corporate
securities.


COMSTOCK HOMEBUILDING: BB&T Forecloses Assets for $32.7MM Debt
--------------------------------------------------------------
Comstock Homebuilding Companies, Inc. allowed Branch Banking &
Trust Co. to complete foreclosure on its properties located in
Virginia and Atlanta, William Rochelle of Bloomberg News says.  In
turn, BB&T will forgive about $32.7 million in mortgage debt and
waive any deficiency claims, the report relates.

Mr. Rochelle notes that Comstock is attempting to restructure a
"significant portion" its $144 million secured debt.  Comstock
stated that is "optimistic" about its debt restructuring efforts,
Mr. Rochelle notes.

The Troubled Company Reporter reports on April 2, 2008, that
Mathis Partners LLC, a single purpose limited liability company
that is a wholly owned subsidiary of Comstock Homebuilding Cos.,
Inc., filed a voluntary petition for reorganization in response to
a foreclosure proceeding which was initiated by Mathis' lender,
Haven Trust Bank, on the single project owned by Mathis.  The
foreclosure proceedings were initiated when Mathis and Haven were
unable to reach an agreement with respect to certain modifications
sought by Mathis on an about $5 million loan relating to the Gates
of Luberon residential development project in Forstyth County,
Georgia.

                       About Mathis Partners

Reston, Virgina-based Mathis Partners, LLC --
http://www.comstockhomebuilding.com/-- is a single purpose  
limited liability company that is a wholly owned subsidiary of
Comstock Homebuilding Cos., Inc.  It was formed by Parker Chandler
Homes, Inc. to develop the Gates of Luberon residential
development project in Forstyth County, Georgia, with Haven Trust
as its lender.

It filed its chapter 11 petition on March 31, 2008 (Bankr. N.D.
Ga. Case No. 08-65876).  Judge Margaret Murphy presides over the
case.  Paul Reece Marr, Esq., at Paul Reece Marr, PC, represents
the Debtor in its restructuring efforts.  The Debtor estimated
both its assets and debts to be between $1 million and
$10 million.

                    About Comstock Homebuilding

Based in Reston, Viginia, Comstock Homebuilding Companies, Inc.
(NasdaqGM: CHCI) -- http://www.comstockhomebuilding.com--   
develops, builds and markets single-family homes, townhouses and
condominiums in the Washington D.C., Raleigh, North Carolina and
Atlanta, Georgia metropolitan markets.  The company also provides
certain management and administrative support services to certain
related parties.

The Troubled Company Reporter said on July 11, 2008, that Comstock
has retained FTI Consulting Inc. as advisor to the company with
respect to strategic and financial alternatives in the face of a
prolonged real estate downturn.

                        Going Concern Doubt

As reported in the Troubled Company Reporter on April 3, 2008,
PricewaterhouseCoopers LLP raised substantial doubt about the
ability of Comstock Homebuilding Companies, Inc., to continue as a
going concern after it audited the company's financial statements
for the year ended Dec. 31, 2007.  The auditor pointed stated that
the company has experienced declining market conditions and has
significant debt maturing during 2008.


CREDIT CDO 2007-1: Planned Liquidation Prompts S&P to Junk Ratings
------------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on the class
X notes issued by High Grade Structured Credit CDO 2007-1 to
'CCC-' from 'BBB-'.  The rating remains on CreditWatch, where it
was placed with negative implications on June 17, 2008.

The downgrade and CreditWatch negative status follow the receipt
of notifications from the transaction's trustee that the
controlling noteholders intend to liquidate the collateral and
terminate the deal.

The deal experienced an event of default (EOD) as a result of the
failure of an overcollateralization-based EOD trigger.  High Grade
Structured Credit CDO 2007-1 is a cash flow collateralized debt
obligation (CDO) of CDO transaction collateralized by other CDO
tranches that are backed by mezzanine residential mortgage-backed
securities (RMBS) and other structured finance assets

Rating Lowered and Remaining on Creditwatch Negative

High Grade Structured Credit CDO 2007-1

                       Rating
Class           To               From
-----           --               ----
X               CCC-/Watch Neg   BBB-/Watch Neg

Other Outstanding Ratings

Class    Rating
-----    ------
CP       CCC-/C/Watch Neg
A-1A     CCC-/C/Watch Neg
A-1B     CCC-/Watch Neg
A-2      CC
A-3      CC
B        CC
C        CC
D        CC


CREDIT SUISSE MORTGAGE: S&P Affirms Class P Certificates at CCC
---------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its ratings on 22
classes of commercial mortgage pass-through certificates from
Credit Suisse Commercial Mortgage Trust Series 2006-C3.

Ratings Affirmed
     
Credit Suisse Commercial Mortgage Trust Series 2006-C3
Commercial mortgage pass-through certificates
   
Class         Rating     Credit enhancement (%)
-----         ------     ----------------------
A-1           AAA                         30.22
A-2           AAA                         30.22
A-3           AAA                         30.22
A-AB          AAA                         30.22
A-1A          AAA                         30.22
A-M           AAA                         20.14
A-J           AAA                         12.97
B             AA                          10.70
C             AA-                          9.82
D             A                            8.18
E             A-                           7.18
F             BBB+                         5.92
G             BBB                          4.66
H             BBB-                         3.53
J             BB+                          3.15
K             BB                           2.77
L             BB-                          2.39
M             B+                           2.14
N             B                            1.76
O             B-                           1.38
P             CCC                          0.88
A-X           AAA                           N/A

N/A-Not applicable.

The affirmed ratings reflect credit enhancement levels that
provide adequate support through various stress scenarios.

As of the Aug. 15, 2008, remittance report, the collateral pool
consisted of 157 loans with an aggregate trust balance of $1.92
billion, compared with the same number of loans totaling $1.93
billion at issuance.  The master servicer, Midland Loan Services
Inc. (Midland), reported financial information for 99% of the
pool.  Ninety-five percent of the servicer-provided information
was full-year 2007 data.

Based on this data, Standard & Poor's calculated a weighted
average debt service coverage (DSC) of 1.37x for the pool, up from
1.35x at issuance.  One asset is with the special servicer, also
Midland. To date, the trust has not experienced any losses.

Eight loans ($35.9 million; 2%) in the pool have reported DSCs of
less than 1.0x, and three loans will have a DSC of less than 0.90x
when their initial interest-only (IO) periods end.

The eight loans with reported DSCs of less than 1.0x have
experienced an average decline in DSC of 55% since issuance and
are secured primarily by a variety of property types.  Standard &
Poor's has credit concerns with three ($15 million) of these eight
loans, as the properties securing them have experienced a
combination of declining occupancy and higher operating
expenses.  The other five loans are not credit concerns at this
time because the properties securing them are in various stages of
lease-up, andS&P expect the net cash flow available for debt
service to improve in the future.

Three loans ($214 million) are projected to have DSCs of less than
0.90x when their initial IO periods end. They are not credit
concerns at this time.  In addition to these three loans, one IO
loan ($8.1 million) is secured by secured by an office property in
Tempe, Ariz., that will experience significant lease roll in the
near future.  The property was 81% occupied as of year-end 2007,
but the largest tenant (occupies 54% of the space) will vacate
the property when its lease expires in October 2008.  The IO
period for this loan expires in nine months.

Details on the sole asset with the special servicer are as
follows:

The BestS&Pstern Orlando loan has a total exposure of $7.9 million
(0.4%) and is secured by a 223-room lodging property in Kissimmee,
Fla.  The loan is 60-days delinquent and was transferred to
Midland on June 12, 2008, due to a borrower request for
forbearance.  The property has lost its franchise agreement with
Bestwestern and the borrower is negotiating with Choice Hotels
to obtain a Clarion brand.  In order to obtain the Clarion brand,
the borrower has to conduct renovations, which will require the
property to be closed.  The borrower is in the process of securing
an equity investor to fund the renovations.  Midland has pursued a
duel resolution strategy of forbearance and foreclosure.  Standard
& Poor's analysis considered the possibility that the renovation
may not materialize.

The top 10 exposures have an aggregate outstanding balance of
$1.05 billion (54%) and a weighted average DSC of 1.28x, down from
1.33x at issuance.  Standard & Poor's reviewed property
inspections for all of the assets underlying the top 10 exposures,
and all of the properties were characterized as "excellent" or
"good."

Midland reported a watchlist of 22 loans ($313.6 million, 16%).
The Babcock & Brown portfolio is the largest loan on the watchlist
and second-largest loan in the pool. The loan is secured by the
fee interests in 17 multifamily properties located in six states.
The loan is on the watchlist because it reported a DSC of 1.06x
for year-end 2007.  The remaining loans are on the watchlist
primarily because of low occupancy or a decline in DSC since
issuance.

Standard & Poor's stressed the loans on the watchlist, along with
other loans that are of credit concerns, as part of its pool
analysis.  The resultant credit enhancement levels support the
affirmed ratings.


CSFB ADJUSTABLE: Moody's Downgrades Ratings on 186 Alt-A Deals
--------------------------------------------------------------
Moody's Investors Service has downgraded the ratings of 186
tranches from 12 Alt-A transactions issued by CSFB.  Some four
downgraded tranches remain on review for possible downgrade.
Additionally, four senior tranches were confirmed at Aaa.  The
collateral backing these transactions consists primarily of first-
lien, fixed and adjustable-rate, Alt-A mortgage loans.

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.  
Certain tranches were confirmed due to additional enhancement
provided by structural features.  The actions are a result of
Moody's on-going review process.

Complete rating actions are:

Issuer: CSFB Adjustable Rate Mortgage Trust 2005-9

   Cl. 1-A-5, Downgraded to A2 from Aaa

   Cl. 2-A-2, Downgraded to A2 from Aaa

   Cl. 3-A-1, Downgraded to A1 from Aaa

   Cl. 3-A-2, Downgraded to A1 from Aaa

   Cl. 3-A-X, Downgraded to A1 from Aaa

   Cl. 4-A-2, Downgraded to A2 from Aa1

   Cl. C-B-3, Downgraded to Ca from B3

Issuer: CSFB Adjustable Rate Mortgage Trust 2005-10

   Cl. 1-A-1, Downgraded to Aa1 from Aaa

   Cl. 1-A-2-2, Downgraded to Aa2 from Aa1

   Cl. 2-A-1, Downgraded to Aa1 from Aaa

   Cl. 3-A-1-2, Downgraded to Aa2 from Aa1

   Cl. 3-A-2, Downgraded to Aa1 from Aaa

   Cl. 3-A-3-2, Downgraded to Aa2 from Aa1

   Cl. 4-A-2, Downgraded to Aa1 from Aaa

   Cl. 5-A-2, Downgraded to Aa3 from Aaa

   Cl. 5-M-2, Upgraded to Baa3 from B3

   Cl. 5-M-3, Downgraded to C from Ca

   Cl. 5-M-4, Downgraded to C from Ca

   Cl. 5-M-5, Downgraded to C from Ca

   Cl. 6-B-1, Downgraded to A1 from Aa2

   Cl. 6-B-2, Downgraded to Baa2 from A3

   Cl. 6-B-3, Downgraded to B2 from Ba1

   Cl. 6-B-4, Downgraded to Ca from Caa3

Issuer: CSFB Adjustable Rate Mortgage Trust 2005-11

   Cl. 1-A-2, Downgraded to Baa2 from Aaa

   Cl. 2-A-1-1, Downgraded to A1 from Aaa

   Cl. 2-A-1-2, Downgraded to Baa1 from Aaa

   Cl. 2-A-2, Downgraded to Baa1 from Aaa

   Cl. 2-A-3, Downgraded to Baa1 from Aaa

   Cl. 2-A-4-1, Downgraded to Baa1 from Aaa

   Cl. 2-A-4-2, Downgraded to Baa1 from Aaa

   Cl. 3-A-1, Downgraded to Baa1 from Aaa

   Cl. 4-A-1, Downgraded to Aa2 from Aaa

   Cl. 4-A-2, Downgraded to Baa2 from Aa1

   Cl. 5-A-2, Downgraded to A2 from Aaa

   Cl. 5-M-1, Downgraded to B3 from B1; Placed Under Review for
further Possible Downgrade

   Cl. 5-M-3, Downgraded to C from Ca

   Cl. 5-M-4, Downgraded to C from Ca

   Cl. 5-M-2, Downgraded to Ca from B3

   Cl. C-B-1, Downgraded to B3 from B1; Placed Under Review for
further Possible Downgrade

   Cl. C-B-2, Downgraded to Ca from B3

Issuer: CSFB Adjustable Rate Mortgage Trust 2005-12

   Cl. 1-A-1, Downgraded to Aa1 from Aaa

   Cl. 1-A-2, Downgraded to Baa2 from Aaa

   Cl. 2-A-1, Downgraded to Aa1 from Aaa

   Cl. 2-A-2, Downgraded to Baa2 from Aaa

   Cl. 3-A-1, Downgraded to Aa1 from Aaa

   Cl. 3-A-2, Downgraded to Baa2 from Aaa

   Cl. 4-A-1, Downgraded to Aa1 from Aaa

   Cl. 4-A-2, Downgraded to Baa2 from Aaa

   Cl. 5-A-2, Downgraded to A1 from Aaa

   Cl. 5-M-1, Downgraded to Caa2 from B1

   Cl. 5-M-2, Downgraded to C from Ca

   Cl. 5-M-3, Downgraded to C from Ca

   Cl. C-B-1, Downgraded to Caa2 from B2

   Cl. C-B-2, Downgraded to Ca from B3

Issuer: CSFB Adjustable Rate Mortgage Trust 2006-1

   Cl. 1-A-1, Downgraded to Ba2 from Aaa

   Cl. 1-A-2, Downgraded to Aa1 from Aaa

   Cl. 1-A-3, Downgraded to Ba3 from Aa1

   Cl. 2-A-1, Downgraded to Aa1 from Aaa

   Cl. 3-A-2, Downgraded to Ba3 from Aaa

   Cl. 3-A-3, Downgraded to Aa1 from Aaa

   Cl. 3-A-4, Downgraded to Ba3 from Aa1

   Cl. 4-A-1, Downgraded to Aa1 from Aaa

   Cl. 4-A-2, Downgraded to Ba3 from Aa1

   Cl. 5-A-1, Downgraded to Aa2 from Aaa

   Cl. 5-A-2, Downgraded to B1 from Aa1

   Cl. 6-A-1, Downgraded to Aa2 from Aaa

   Cl. 6-A-2, Downgraded to Ba2 from Aaa

   Cl. 6-M-1, Downgraded to Caa3 from B3

   Cl. 6-M-2, Downgraded to C from Caa1

   Cl. 6-M-3, Downgraded to C from Ca

   Cl. C-B-1, Downgraded to B3 from Ba1; Placed Under Review for
further Possible Downgrade

   Cl. C-B-3, Downgraded to Ca from B3

Issuer: Adjustable Rate Mortgage Trust 2006-2

   Cl. 3-A-1, Downgraded to Aa1 from Aaa

   Cl. 3-A-2, Downgraded to Ba2 from Aa1

   Cl. 4-A-1, Downgraded to Aa1 from Aaa

   Cl. 4-A-2, Downgraded to Ba2 from Aa1

   Cl. 5-A-1, Downgraded to Aa1 from Aaa

   Cl. 5-A-2, Downgraded to Ba2 from Aa1

   Cl. 6-A-1, Downgraded to Aa1 from Aaa

   Cl. 6-A-2, Downgraded to Ba2 from Aaa

   Cl. 6-M-1, Downgraded to Caa2 from B3

   Cl. 6-M-2, Downgraded to C from Caa1

   Cl. 6-M-3, Downgraded to C from Ca

   Cl. 6-M-4, Downgraded to C from Ca

   Cl. C-B-1, Downgraded to Ca from B3

   Cl. C-B-2, Downgraded to Ca from B3

Issuer: CSFB Adjustable Rate Mortgage Trust 2006-3

   Cl. 2-A-2, Downgraded to Aa3 from Aa1

   Cl. 4-A-4, Downgraded to Baa3 from Aaa

   Cl. C-M-1, Downgraded to A1 from Aaa

   Cl. 4-M-1, Downgraded to B3 from B2

   Cl. 4-M-3, Downgraded to Caa1 from B3

   Cl. 4-M-4, Downgraded to Caa2 from B3

   Cl. 4-M-5, Downgraded to Ca from B3

   Cl. 4-M-6, Downgraded to Ca from B3

   Cl. 4-M-7, Downgraded to Ca from Caa1

   Cl. 4-M-8, Downgraded to C from Ca

   Cl. 4-M-9, Downgraded to C from Ca

   Cl. 4-B-1, Downgraded to C from Ca

   Cl. C-B-1, Downgraded to B2 from Ba3

   Cl. C-B-2, Downgraded to Caa1 from B2

   Cl. C-B-3, Downgraded to Ca from B3

Issuer: CSFB Adjustable Rate Mortgage Trust 2007-1

   Cl. 1-A-2, Downgraded to Ba1 from Aa1

   Cl. 2-A-1, Downgraded to Baa3 from Aaa

   Cl. 3-A-3, Downgraded to Ba1 from Aa1

   Cl. 4-A-2, Downgraded to Ba2 from Aa1

   Cl. 5-A-1, Downgraded to Baa2 from Aaa

   Cl. 5-A-2-1, Downgraded to Baa2 from Aaa

   Cl. 5-A-2-2, Downgraded to Baa2 from Aaa

   Cl. 5-A-3-2, Downgraded to Baa2 from Aaa

   Cl. 5-A-4, Downgraded to B3 from B2; Placed Under Review for
further Possible Downgrade

   Cl. 5-M-1, Downgraded to Caa1 from B3

   Cl. 5-M-2, Downgraded to Caa3 from B3

   Cl. 5-M-3, Downgraded to Ca from B3

   Cl. 5-M-4, Downgraded to Ca from B3

   Cl. 5-M-6, Downgraded to C from Ca

   Cl. 5-M-7, Downgraded to C from Ca

   Cl. 5-M-8, Downgraded to C from Ca

   Cl. 5-M-9, Downgraded to C from Ca

   Cl. C-B-1, Downgraded to B3 from B2; Placed Under Review for
further Possible Downgrade

   Cl. C-B-2, Downgraded to Caa1 from B1

Issuer: CSFB Adjustable Rate Mortgage Trust 2007-2

   Cl. 2-A-2-1, Downgraded to B1 from Aaa

   Cl. 2-A-2-2, Downgraded to B2 from Aaa

   Cl. 2-A-3, Downgraded to Caa1 from Aaa

   Cl. 2-M-1, Downgraded to Ca from B2

   Cl. 2-M-2, Downgraded to C from B3

   Cl. 2-M-3, Downgraded to C from B3

   Cl. 2-M-4, Downgraded to C from Ca

   Cl. 2-M-5, Downgraded to C from Ca

   Cl. 2-M-6, Downgraded to C from Ca

   Cl. 2-M-7, Downgraded to C from Ca

Issuer: CSFB Mortgage-Backed Pass-Through Certificates, Series
2005-10

   Cl. III-A-2, Confirmed at Aaa

   Cl. III-A-3, Downgraded to Baa2 from Aaa

   Cl. III-A-4, Downgraded to Baa3 from Aaa

   Cl. IV-A-1, Downgraded to A2 from Aaa

   Cl. IV-A-2, Downgraded to Ba1 from Aa1

   Cl. V-A-1, Downgraded to Baa2 from Aaa

   Cl. V-A-2, Downgraded to Baa2 from Aaa

   Cl. V-A-3, Downgraded to Baa2 from Aaa

   Cl. V-A-5, Downgraded to Baa2 from Aaa

   Cl. V-A-6, Downgraded to Baa2 from Aaa

   Cl. V-A-7, Downgraded to Baa2 from Aaa

   Cl. V-A-8, Downgraded to Baa2 from Aaa

   Cl. V-A-9, Downgraded to Baa2 from Aaa

   Cl. V-A-10, Downgraded to Baa3 from Aa1

   Cl. VIII-A-1, Downgraded to Baa2 from Aaa

   Cl. VIII-A-2, Downgraded to Baa2 from Aaa

   Cl. VIII-A-3, Downgraded to Aa2 from Aaa

   Cl. VIII-A-4, Downgraded to Baa3 from Aa1

   Cl. IX-A-1, Downgraded to Baa2 from Aaa

   Cl. X-A-1, Downgraded to Baa2 from Aaa

   Cl. X-A-2, Downgraded to Baa2 from Aaa

   Cl. X-A-3, Downgraded to Aa2 from Aaa

   Cl. X-A-4, Downgraded to Baa2 from Aaa

   Cl. X-A-5, Downgraded to Baa3 from Aa1

   Cl. A-P, Downgraded to Baa2 from Aaa

   Cl. A-X, Confirmed at Aaa

   Cl. D-X-1, Confirmed at Aaa

   Cl. D-X-2, Downgraded to Aa2 from Aaa

   Cl. D-B-1, Downgraded to Caa1 from B2

   Cl. D-B-2, Downgraded to Ca from B3

Issuer: CSFB Mortgage-Backed Pass-Through Certificates, Series
2005-11

   Cl. 1-A-1, Downgraded to Baa1 from Aaa

   Cl. 2-A-1, Downgraded to Baa1 from Aaa

   Cl. 3-A-1, Downgraded to Baa1 from Aaa

   Cl. 3-A-2, Downgraded to Baa1 from Aaa

   Cl. 3-A-3, Downgraded to Baa1 from Aaa

   Cl. 3-A-4, Downgraded to Baa2 from Aaa

   Cl. 3-A-5, Downgraded to Baa1 from Aaa

   Cl. 3-A-7, Downgraded to Baa1 from Aaa

   Cl. 4-A-1, Downgraded to Baa1 from Aaa

   Cl. 7-A-1, Downgraded to Aa1 from Aaa

   Cl. 7-A-2, Downgraded to Baa2 from Aaa

   Cl. D-X, Confirmed at Aaa

   Cl. D-B-2, Downgraded to Ca from B3

   Cl. D-B-3, Downgraded to Ca from Caa3

Issuer: CSFB Mortgage-Backed Pass-Through Securities, Series 2005-
12

   Cl. 1-A-1, Downgraded to A1 from Aaa

   Cl. 2-A-1, Downgraded to Baa2 from Aaa

   Cl. 3-A-1, Downgraded to Baa2 from Aaa

   Cl. 4-A-1, Downgraded to A1 from Aaa

   Cl. 5-A-2, Downgraded to A2 from Aaa

   Cl. 6-A-1, Downgraded to Baa1 from Aaa

   Cl. 6-A-2, Downgraded to Baa3 from Aa1

   Cl. 7-A-1, Downgraded to Baa3 from Aaa

   Cl. 8-A-1, Downgraded to Baa2 from Aaa

   Cl. A-P, Downgraded to A1 from Aaa

   Cl. A-X, Downgraded to Baa2 from Aaa

   Cl. D-X-1, Downgraded to A1 from Aaa

   Cl. D-B-2, Downgraded to Caa2 from B1

   Cl. D-B-1, Downgraded to Ba1 from Baa3

   Cl. D-B-3, Downgraded to Ca from B2

   Cl. D-B-4, Downgraded to Ca from B3


CWALT INC: Moody's Lowers Ratings on 311 Tranches of Certificates
-----------------------------------------------------------------
Moody's Investors Service has downgraded the ratings of 311
tranches and placed 6 tranche on review for downgrade from 29
Option ARM transactions issued by Countrywide in 2006 and 2007.
Forty six tranches that were downgraded remain on review for
possible further downgrade.  Additionally, 29 senior tranches were
confirmed at Aaa.  The collateral backing these transactions
consists primarily of first-lien, hybrid and adjustable rate,
negatively amortizing Alt-A mortgage loans.

Ratings were downgraded, in general, based on higher than
anticipated rates of delinquency, foreclosure, and REO in the
underlying collateral relative to credit enhancement levels.  The
actions described below are a result of Moody's on-going review
process.

Moody's Investors Service also took action on certain insured
notes as identified below.  The ratings on securities that are
guaranteed or "wrapped" by a financial guarantor is the higher of
a) the rating of the guarantor or b) the published underlying
rating.  The underlying ratings reflect the intrinsic credit
quality of the notes in the absence of the guarantee.  The current
ratings on the below notes are consistent with Moody's practice of
rating insured securities at the higher of the guarantor's
insurance financial strength rating and any underlying rating that
is public.

Complete rating actions are:

Issuer: CWALT, Inc. Mortgage Pass-Through Certificates, Series
2006-OA2

   -- Cl. A-2A, Downgraded to A1 from Aaa

   -- Cl. A-2B, Downgraded to A2 from Aaa

   -- Cl. A-3, Downgraded to A2 from Aaa

   -- Cl. A-4, Downgraded to B2 from Aaa

   -- Cl. A-6, Downgraded to B2 from Aaa

   -- Cl. A-7, Downgraded to B1 from Aaa

   -- Cl. X-1, Confirmed at Aaa

   -- Cl. X-1P, Confirmed at Aaa

   -- Cl. X-2, Downgraded to B1 from Aaa

   -- Cl. B-1, Downgraded to C from Ca

   -- Cl. M-1, Downgraded to B3 from B2; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-2, Downgraded to Ca from B3

   -- Cl. M-3, Downgraded to Ca from B3

   -- Cl. M-4, Downgraded to Ca from Caa1

   -- Cl. M-5, Downgraded to Ca from Caa1

Issuer: CWALT, Inc. Mortgage Pass-Through Certificates, Series
2006-OA3

   -- Cl. 1-A-2, Downgraded to Baa1 from Aaa

   -- Cl. 1-A-3, Downgraded to Ba2 from Aaa

   -- Cl. 2-A-2, Downgraded to Baa1 from Aaa

   -- Cl. 2-A-3, Downgraded to Ba2 from Aaa

   -- Cl. X, Confirmed at Aaa

   -- Cl. M-1, Downgraded to B3 from B1; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-2, Downgraded to Ca from B3

   -- Cl. M-3, Downgraded to Ca from B3

   -- Cl. M-4, Downgraded to Ca from Caa1

   -- Cl. M-5, Downgraded to C from Ca

   -- Cl. M-6, Downgraded to C from Ca

   -- Cl. M-7, Downgraded to C from Ca

Issuer: CWALT, Inc. Mortgage Pass-Through Certificates, Series
2006-OA6

   -- Cl. 1A-1B, Downgraded to Baa1 from Aaa

   -- Cl. 1A-4A, Downgraded to Baa1 from Aaa

   -- Cl. 1A-4B, Downgraded to Aa1 from Aaa

   -- Cl. 1A-4C, Downgraded to A3 from Aaa

   -- Cl. 1A-4D, Downgraded to Baa1 from Aaa

   -- Cl. 2-A, Downgraded to Baa1 from Aaa

   -- Cl. M-1, Downgraded to B2 from B1; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-2, Downgraded to Caa3 from B3

   -- Cl. M-3, Downgraded to Ca from B3

   -- Cl. M-4, Downgraded to Ca from Caa1

   -- Cl. M-6, Downgraded to C from Ca

   -- Cl. M-7, Downgraded to C from Ca

Issuer: CWALT, Inc. Mortgage Pass-Through Certificates, Series
2006-OA7

   -- Cl. 1-A-1, Downgraded to Ba3 from Aaa

   -- Cl. 1-A-3, Downgraded to A3 from Aaa

   -- Cl. 1-A-4, Downgraded to B1 from Aaa

   -- Cl. 2-A-2, Downgraded to A3 from Aaa

   -- Cl. 2-A-3, Downgraded to B1 from Aaa

   -- Cl. 3-A-1, Downgraded to A3 from Aaa

   -- Cl. 3-A-2, Downgraded to B1 from Aaa

   -- Cl. 1-X, Confirmed at Aaa

   -- Cl. 2-X, Confirmed at Aaa

   -- Cl. M-1, Downgraded to Caa2 from B3

   -- Cl. M-2, Downgraded to Ca from Caa1

   -- Cl. M-3, Downgraded to Ca from Caa1

   -- Cl. M-4, Downgraded to C from Ca

   -- Cl. M-5, Downgraded to C from Ca

   -- Cl. M-6, Downgraded to C from Ca

   -- Cl. M-7, Downgraded to C from Ca

Issuer: CWALT, Inc. Mortgage Pass-Through Certificates, Series
2006-OA8

   -- Cl. 1-A-2, Downgraded to Aa1 from Aaa

   -- Cl. 1-A-3, Downgraded to Ba3 from Aaa

   -- Cl. 2-A-3, Downgraded to Aa1 from Aaa

   -- Cl. 2-A-4, Downgraded to Aa1 from Aaa

   -- Cl. 2-A-5, Downgraded to Ba3 from Aaa

   -- Cl. X, Confirmed at Aaa

   -- Cl. M-1, Downgraded to B3 from B1; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-2, Downgraded to Ca from B3

   -- Cl. M-3, Downgraded to C from Caa1

   -- Cl. M-4, Downgraded to C from Ca

   -- Cl. M-5, Downgraded to C from Ca

   -- Cl. M-6, Downgraded to C from Ca

   -- Cl. M-7, Downgraded to C from Ca

Issuer: CWALT, Inc. Mortgage Pass-Through Certificates, Series
2006-OA9

   -- Cl. 1-A-2, Downgraded to B2 from Aa

   -- Cl. 2-A-2, Downgraded to Aa1 from Aaa

   -- Cl. 2-A-3, Downgraded to B2 from Aaa

   -- Cl. X-1, Confirmed at Aaa

   -- Cl. X-1P, Confirmed at Aaa

   -- Cl. X-2, Downgraded to Aa1 from Aaa

   -- Cl. B-1, Downgraded to C from Ca

   -- Cl. M-1, Downgraded to Caa1 from B3

   -- Cl. M-2, Downgraded to Ca from B3

   -- Cl. M-3, Downgraded to Ca from B3

   -- Cl. M-4, Downgraded to Ca from Caa1

   -- Cl. M-5, Downgraded to Ca from Caa1

   -- Cl. M-6, Downgraded to Ca from Caa1

   -- Cl. M-10, Downgraded to C from Ca

Issuer: CWALT, Inc. Mortgage Pass-Through Certificates, Series
2006-OA10

   -- Cl. 1-A-2, Downgraded to A3 from Aaa

   -- Cl. 1-A-3, Downgraded to Ba3 from Aaa

   -- Cl. 2-A-2, Downgraded to A3 from Aaa

   -- Cl. 2-A-3, Downgraded to Ba3 from Aaa

   -- Cl. 3-A-2, Downgraded to A3 from Aaa

   -- Cl. 3-A-3, Downgraded to Ba3 from Aaa

   -- Cl. 4-A-2, Downgraded to A3 from Aaa

   -- Cl. 4-A-3, Downgraded to Ba3 from Aaa

   -- Cl. X-AD, Confirmed at Aaa

   -- Cl. X-BI, Confirmed at Aaa

   -- Cl. X-BJ, Confirmed at Aaa

   -- Cl. X-NB, Confirmed at Aaa

   -- Cl. X-PP, Confirmed at Aaa

   -- Cl. M-1, Downgraded to Caa1 from B3

   -- Cl. M-2, Downgraded to Ca from B3

   -- Cl. M-3, Downgraded to C from Caa1

   -- Cl. M-4, Downgraded to C from Caa1

   -- Cl. M-5, Downgraded to C from Ca

   -- Cl. M-6, Downgraded to C from Ca

   -- Cl. M-7, Downgraded to C from Ca

Issuer: CWALT, Inc. Mortgage Pass-Through Certificates, Series
2006-OA11

   -- Cl. A-3A, Downgraded to Baa3 from Aaa

   -- Cl. A-3B-1, Downgraded to A1 from Aaa

   -- Cl. A-3B-2, Downgraded to Baa3 from Aaa

   -- Cl. A-5, Downgraded to Baa3 from Aaa

   -- Cl. M-1, Downgraded to Ba3 from Ba1

   -- Cl. M-2, Placed on Review for Possible Downgrade, currently
      B3

   -- Cl. M-3, Downgraded to Caa1 from B3

   -- Cl. M-4, Downgraded to Ca from B3

   -- Cl. M-5, Downgraded to Ca from B3

   -- Cl. M-6, Downgraded to Ca from B3

   -- Cl. M-7, Downgraded to C from Ca

   -- Cl. M-8, Downgraded to C from Ca

   -- Cl. M-9, Downgraded to C from Ca

Issuer: CWALT, Inc. Mortgage Pass-Through Certificates, Series
2006-OA12

   -- Cl. A-3, Downgraded to B1 from Aaa

   -- Cl. X, Confirmed at Aaa

   -- Cl. X-P, Confirmed at Aaa

   -- Cl. B-1, Downgraded to C from Ca

   -- Cl. B-2, Downgraded to C from Ca

   -- Cl. M-1, Downgraded to B3 from B2; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-2, Downgraded to Ca from B3

   -- Cl. M-3, Downgraded to Ca from B3

   -- Cl. M-4, Downgraded to Ca from B3

   -- Cl. M-5, Downgraded to Ca from Caa1

Issuer: CWALT, Inc. Mortgage Pass-Through Certificates, Series
2006-OA14

   -- Cl. 1-A-2, Downgraded to A1 from Aaa

   -- Cl. 1-A-3, Downgraded to Ba2 from Aaa

   -- Cl. 2-A-2, Downgraded to A1 from Aaa

   -- Cl. 2-A-3, Downgraded to Ba2 from Aaa

   -- Cl. 3-A-2, Downgraded to Ba2 from Aaa

   -- Cl. X-1, Confirmed at Aaa

   -- Cl. X-2, Confirmed at Aaa

   -- Cl. M-1, Downgraded to B2 from A3; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-2, Downgraded to Caa1 from Ba2

   -- Cl. M-3, Downgraded to Caa3 from Ba3

   -- Cl. M-4, Downgraded to Ca from B1

   -- Cl. M-5, Downgraded to Ca from B2

   -- Cl. M-6, Downgraded to Ca from B2

   -- Cl. M-7, Downgraded to C from B3

   -- Cl. M-8, Downgraded to C from Ca

   -- Cl. M-9, Downgraded to C from Ca

Issuer: CWALT, Inc. Mortgage Pass-Through Certificates, Series
2006-OA16

   -- Cl. A-5, Downgraded to Ba1 from Aaa

   -- Cl. M-1, Downgraded to Ba3 from Baa1

   -- Cl. M-2, Downgraded to B3 from B2; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-3, Downgraded to B3 from B2; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-4, Downgraded to Caa3 from B3

   -- Cl. M-5, Downgraded to Ca from B3

   -- Cl. M-6, Downgraded to Ca from B3

   -- Cl. M-7, Downgraded to Ca from Caa1

   -- Cl. M-8, Downgraded to C from Ca

   -- Cl. M-9, Downgraded to C from Ca

Issuer: CWALT, Inc. Mortgage Pass-Through Certificates, Series
2006-OA17

   -- Cl. 1-A3, Downgraded to Ba3 from Aaa

   -- Cl. 2-A-2, Downgraded to Ba3 from Aaa

   -- Cl. M-1, Downgraded to B3 from B1; Placed Under Review for
further Possible Downgrade

   -- Cl. M-2, Downgraded to Caa1 from B2

   -- Cl. M-3, Downgraded to Caa3 from B3

   -- Cl. M-4, Downgraded to Ca from B3

   -- Cl. M-5, Downgraded to Ca from B3

   -- Cl. M-6, Downgraded to Ca from B3

   -- Cl. M-7, Downgraded to Ca from Caa1

   -- Cl. 2-X, Confirmed at Aaa

   -- Cl. 1-X-P, Confirmed at Aaa

Issuer: CWALT, Inc. Mortgage Pass-Through Certificates, Series
2006-OA18

   -- Cl. A-3, Downgraded to Ba1 from Aaa

   -- Cl. M-1, Downgraded to B1 from Ba3; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-2, Placed on Review for Possible Downgrade, currently
      B3

   -- Cl. M-3, Downgraded to Caa1 from B3

   -- Cl. M-4, Downgraded to Ca from B3

   -- Cl. M-5, Downgraded to Ca from B3

   -- Cl. M-6, Downgraded to Ca from Caa1

   -- Cl. M-7, Downgraded to C from Caa1

   -- Cl. M-8, Downgraded to C from Ca

   -- Cl. M-9, Downgraded to C from Ca

Issuer: CWALT, Inc. Mortgage Pass-Through Certificates, Series
2006-OA19

   -- Cl. A-2, Downgraded to Aa1 from Aaa

   -- Cl. A-3A, Downgraded to Aa3 from Aaa

   -- Cl. A-3B, Downgraded to Ba3 from Aaa

   -- Cl. A-5, Placed on Review for Possible Downgrade, currently
      Aaa

   -- Cl. M-2, Downgraded to B3 from B2; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-3, Downgraded to Caa2 from B2

   -- Cl. M-4, Downgraded to Ca from B3

   -- Cl. M-5, Downgraded to Ca from B3

   -- Cl. M-6, Downgraded to Ca from B3

   -- Cl. M-7, Downgraded to Ca from Caa1

   -- Cl. B-1, Downgraded to C from Caa1

   -- Cl. X-P, Confirmed at Aaa

Issuer: CWALT, Inc. Mortgage Pass-Through Certificates, Series
2006-OA21

   -- Cl. A-3, Downgraded to Ba1 from Aaa

   -- Cl. M-1, Downgraded to B2 from B1

   -- Cl. M-2, Downgraded to B3 from B1; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-3, Downgraded to Caa1 from B2

   -- Cl. M-4, Downgraded to Caa3 from B2

   -- Cl. M-5, Downgraded to Ca from B3

   -- Cl. M-6, Downgraded to Ca from B3

   -- Cl. M-7, Downgraded to Ca from B3

   -- Cl. M-8, Downgraded to Ca from Caa1

   -- Cl. B-1, Downgraded to C from Caa2

   -- Cl. X, Confirmed at Aaa

Issuer: CWALT, Inc. Mortgage Pass-Through Certificates, Series
2006-OA22

   -- Cl. A-3, Downgraded to Baa2 from Aaa

   -- Cl. M-1, Downgraded to Ba3 from A1

   -- Cl. M-2, Downgraded to B1 from Ba2; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-3, Downgraded to B2 from Ba3; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-4, Downgraded to Caa2 from B3

   -- Cl. M-5, Downgraded to Ca from B3

   -- Cl. M-6, Downgraded to Ca from B3

   -- Cl. M-7, Downgraded to Ca from B3

   -- Cl. M-8, Downgraded to C from Caa1

   -- Cl. M-9, Downgraded to C from Ca

Issuer: CWALT, Inc. Mortgage Pass-Through Certificates, Series
2007-AL1

   -- Cl. A-1, Downgraded to Aa1 from Aaa

   -- Cl. A-2, Downgraded to Baa1 from Aaa

   -- Cl. A-3, Downgraded to B3 from Aaa; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-1, Downgraded to Caa1 from Ba3

   -- Cl. M-2, Downgraded to Caa2 from B3

   -- Cl. M-3, Downgraded to Ca from B3

   -- Cl. M-4, Downgraded to Ca from B3

   -- Cl. M-5, Downgraded to Ca from Caa1

   -- Cl. B-1, Downgraded to C from Ca

   -- Cl. X-P, Downgraded to Aa1 from Aaa

Issuer: CWALT, INC.Mortgage Pass-Through Certificates, Series
2007-OA2

   -- Cl. 1-A-3, Downgraded to B2 from Aaa

   -- Cl. 2-A-3, Downgraded to B2 from Aaa

   -- Cl. 1-A-2, Downgraded to Ba1 from Aaa

   -- Cl. 2-A-2, Downgraded to Baa1 from Aaa

   -- Cl. M-1, Downgraded to Caa2 from B3

   -- Cl. M-2, Downgraded to Ca from B3

   -- Cl. M-3, Downgraded to Ca from Caa1

   -- Cl. M-6, Downgraded to C from Ca

   -- Cl. M-7, Downgraded to C from Ca

   -- Cl. 2-X, Confirmed at Aaa

   -- Cl. 1-X, Confirmed at Aaa

Issuer: CWALT, Inc. Mortgage Pass-Through Certificates, Series
2007-OA3

   -- Cl. 1-A-3, Downgraded to Baa3 from Aaa

   -- Cl. 2-A-3, Downgraded to Baa3 from Aaa

   -- Cl. M-1, Downgraded to Ba3 from Aa3

   -- Cl. M-2, Downgraded to B3 from Ba1; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-3, Downgraded to B3 from Ba3; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-4, Downgraded to Caa1 from B1

   -- Cl. M-5, Downgraded to Caa3 from B2

   -- Cl. M-6, Downgraded to Ca from B3

   -- Cl. M-7, Downgraded to Ca from B3

   -- Cl. M-8, Downgraded to Ca from B3

   -- Cl. M-9, Downgraded to C from Caa1

   -- Cl. M-10, Downgraded to C from Ca

   -- Cl. X, Confirmed at Aaa

Issuer: CWALT, Inc. Mortgage Pass-Through Certificates, Series
2007-OA4

   -- Cl. A-3, Downgraded to Baa1 from Aaa

   -- Cl. M-1, Downgraded to Ba1 from Aaa

   -- Cl. M-2, Downgraded to Ba3 from Aaa

   -- Cl. M-3, Downgraded to B1 from A1

   -- Cl. M-4, Downgraded to B2 from Baa3; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-5, Downgraded to B3 from Ba1; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-6, Downgraded to B3 from B1; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-7, Downgraded to Caa1 from B2

   -- Cl. M-8, Downgraded to Caa3 from B2

Issuer: CWALT, Inc. Mortgage Pass-Through Certificates, Series
2007-OA6

   -- Cl. A-3, Downgraded to A3 from Aaa

   -- Cl. M-1, Downgraded to Ba2 from Aaa

   -- Cl. M-2, Downgraded to B1 from A3

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

   -- Cl. M-4, Downgraded to B3 from Ba2; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-5, Downgraded to B3 from B2; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-6, Downgraded to Caa1 from B2

   -- Cl. M-7, Downgraded to Ca from B3

   -- Cl. M-8, Downgraded to Ca from B3

Issuer: CWALT, Inc. Mortgage Pass-Through Certificates, Series
2007-OA7

   -- Cl. A-3, Downgraded to Baa3 from Aaa

   -- Cl. M-1, Downgraded to Ba3 from A3

   -- Cl. M-2, Downgraded to B3 from Ba1; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-3, Downgraded to B3 from Ba2; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-4, Downgraded to Caa2 from B3

   -- Cl. M-5, Downgraded to Ca from B3

   -- Cl. M-6, Downgraded to Ca from B3

   -- Cl. M-7, Downgraded to Ca from Caa1

   -- Cl. M-8, Downgraded to C from Caa1

   -- Cl. M-9, Downgraded to C from Ca

Issuer: CWALT, Inc. Mortgage Pass-Through Certificates, Series
2007-OA8

   -- Cl. 1-A-2, Downgraded to A3 from Aaa

   -- Cl. 2-A-2, Downgraded to A3 from Aaa

   -- Cl. 1-A-3, Downgraded to Ba1 from Aaa

   -- Cl. 2-A-3, Downgraded to Ba1 from Aaa

   -- Cl. M-1, Downgraded to B2 from Baa3; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-2, Downgraded to B3 from Ba1; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-3, Downgraded to Caa1 from Ba2

   -- Cl. M-4, Downgraded to Caa3 from Ba3

   -- Cl. M-5, Downgraded to Ca from B3

   -- Cl. M-6, Downgraded to Ca from B3

   -- Cl. M-7, Downgraded to Ca from B3

   -- Cl. M-8, Downgraded to C from B3

   -- Cl. M-9, Downgraded to C from Caa1

   -- Cl. M-10, Downgraded to C from Ca

   -- Cl. X, Confirmed at Aaa

Issuer: CWALT, Inc. Mortgage Pass-Through Certificates, Series
2007-OA9

   -- Cl. A-3, Downgraded to Baa2 from Aaa

   -- Cl. M-1, Downgraded to Ba3 from A2

   -- Cl. M-2, Downgraded to B1 from Baa3

   -- Cl. M-3, Downgraded to B2 from Ba1; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-4, Downgraded to B2 from Ba2; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-5, Downgraded to B3 from B1; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-6, Downgraded to B3 from B1; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-7, Downgraded to Caa1 from B1

   -- Cl. M-8, Downgraded to Caa3 from B1

   -- Cl. M-9, Downgraded to Ca from B2

   -- Cl. X-P, Confirmed at Aaa

Issuer: CWALT, Inc. Mortgage Pass-Through Certificates, Series
2007-OA10

   -- Cl. 1-A-2, Placed on Review for Possible Downgrade,
      currently Aaa

Financial Guarantor: Assured Guaranty Corp (Aaa on review for
possible downgrade)

Underlying Rating: Ba1

   -- Cl. 2-A-3, Placed on Review for Possible Downgrade,
      currently Aaa

Financial Guarantor: Assured Guaranty Corp (Aaa on review for
possible downgrade)

Underlying Rating: Ba1

   -- Cl. M-1, Downgraded to B1 from A2

   -- Cl. M-7, Downgraded to Ca from B2

   -- Cl. M-8, Downgraded to Ca from B2

   -- Cl. M-9, Downgraded to Ca from B3

   -- Cl. M-10, Downgraded to C from Caa1

   -- Cl. M-5, Downgraded to Caa1 from B1

   -- Cl. M-6, Downgraded to Caa2 from B2

   -- Cl. M-4, Downgraded to B3 from B1; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-3, Downgraded to B3 from Ba2; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-2, Downgraded to B2 from Baa2; Placed Under Review for
      further Possible Downgrade

   -- Cl. X, Confirmed at Aaa

Issuer: CWALT, Inc. Mortgage Pass-Through Certificates, Series
2007-OA11

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

   -- Cl. A-3, Placed on Review for Possible Downgrade, currently
      Aaa

   -- Cl. B-1, Downgraded to Ca from Ba1

   -- Cl. M-2, Downgraded to B1 from Aa2

   -- Cl. M-1, Downgraded to Ba3 from Aa1

   -- Cl. M-6, Downgraded to Caa1 from A3

   -- Cl. M-9, Downgraded to Ca from Baa3

   -- Cl. M-7, Downgraded to Caa2 from Baa1

   -- Cl. M-8, Downgraded to Caa3 from Baa2

   -- Cl. M-4, Downgraded to B3 from A1; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-5, Downgraded to B3 from A2; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-3, Downgraded to B2 from Aa3; Placed Under Review for
      further Possible Downgrade

   -- Cl. X-P, Confirmed at Aaa

Issuer: CWALT, Inc. Mortgage Pass-Through Certificates, Series
2007-OH1

   -- Cl. A-3, Downgraded to Baa3 from Aaa

   -- Cl. M-1, Downgraded to Ba3 from Baa3

   -- Cl. M-2, Downgraded to B1 from Ba2

   -- Cl. M-3, Downgraded to B2 from Ba3; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-4, Downgraded to B3 from B1; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-5, Downgraded to B3 from B1; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-6, Downgraded to Caa1 from B2

   -- Cl. M-7, Downgraded to Caa3 from B2

   -- Cl. M-8, Downgraded to Ca from B3

   -- Cl. X-P, Confirmed at Aaa

Issuer: CWALT, Inc. Mortgage Pass-Through Certificates, Series
2007-OH2

   -- Cl. A-3, Downgraded to Baa2 from Aaa

   -- Cl. M-1, Downgraded to Ba1 from Aa2

   -- Cl. M-2, Downgraded to Ba2 from A1

   -- Cl. M-3, Downgraded to Ba3 from Baa1

   -- Cl. M-4, Downgraded to B1 from Ba1

   -- Cl. M-5, Downgraded to B2 from Ba3; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-6, Downgraded to B3 from B1; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-7, Downgraded to Ca from B1

Issuer: CWALT, Inc. Mortgage Pass-Through Certificates, Series
2007-OH3

   -- Cl. A-3, Downgraded to Baa3 from Aaa

   -- Cl. M-1, Downgraded to Ba3 from Baa1

   -- Cl. M-2, Downgraded to B1 from Ba1

   -- Cl. M-3, Downgraded to B2 from Ba3; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-4, Downgraded to B3 from B1; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-5, Downgraded to B3 from B1; Placed Under Review for
      further Possible Downgrade

   -- Cl. M-6, Downgraded to Caa1 from B2

   -- Cl. M-7, Downgraded to Ca from B3


DELPHI CORP: Appaloosa Insists Right to Cancel Funding Pledge
-------------------------------------------------------------
Appaloosa Management L.P. and A-D Acquisition Holdings, LLC,
together with the other defendants, have denied Delphi Corp.'s
allegations and claims that it is entitled to specific performance
by investors of their commitment to provide $2,550,000,000 in exit
equity financing.

Appaloosa says that it had grounds to terminate their agreement
after Delphi allowed General Motors Corp. to participate in the
exit financing process, which undermined their agreed objective
of Delphi's reorganization -- to disentangle itself from its
former parent and increase penetration of non-GM customers.

The parties earlier entered a stipulation extending the
defendants' deadline to submit their answers to the Complaints to
September 2.

Appaloosa, et al., deny Delphi's claims for:

   (i) breach of contract in connection with the Equity Purchase
       and Commitment Agreement dated of August 3, 2007, as
       amended on December 10, 2007, which sets forth the
       obligation of ADAH, Harbinger Del-Auto Investment Company,
       Ltd., Pardus DPH Holding LLC, Merrill Lynch, Pierce,
       Fenner & Smith Incorporated, and Goldman Sachs & Co. to
       invest up to $2,550,000,000 in reorganized Delphi;

  (ii) breach of contract by Appaloosa, Harbinger Capital
       Partners Master Fund I, Ltd., and Pardus Special
       Opportunities Master Fund L.P., in connection with the
       Commitment Letter Agreements;

(iii) relief against all defendants pursuant to Section 1142 of
       the Bankruptcy Code, which empowers the U.S. Bankruptcy     
       Court for the Southern District of New York to direct any
       necessary party to perform any act that is necessary for
       the consummation of a plan;

  (iv) fraud against Appaloosa because it (i) deceived Delphi by
       concealing its plans, decision and actions to undermine
       the EPCA, and the Plan and the equity financing needed for
       the consummation of the Plan, and (ii) assured Delphi that
       it will fulfill its investment obligations, despite its
       plans to the contrary, resulting to Delphi refraining from
       pursuing alternatives, to its own detriment and the
       detriment of all its stakeholders; and

   (v) equitable subordination or disallowance of the claims of
       the defendants for acting inequitably and breaching their
       duties to the Debtors and causing substantial harm to the
       Debtors, their employees, creditors and other
       stakeholders.

UBS Securities, LLC, also refutes Delphi's assertions that (i)
UBS breached its obligations by failing to use its reasonable
best efforts to consummate the EPCA, (ii) the Court should
exercise its equitable authority under Section 1142 to order UBS
to comply with its obligations under the Plan and the EPCA, and
(iii) UBS' claims or interests should be equitably subordinated
or disallowed.  UBS denies that Delphi is entitled to specific
performance ordering UBS to invest $166,866,749, and says, among
its affirmative defenses, that the EPCA limits Delphi's claims
against UBS to $16,358,805.

Representing Appaloosa and ADAH, J. Christopher Shore, Esq., at
White & Case LLP, in New York, asserts 12 affirmative defenses
that would bar, in whole or in part, Delphi's claims:

   (1) the failure to state a claim;

   (2) the doctrine of estoppel;

   (3) the doctrine of election of remedies;

   (4) the doctrine of judicial estoppel;

   (5) the doctrine of law of the case;

   (6) the doctrine of laches;

   (7) the doctrine of unclean hands;

   (8) waiver and release of Delphi's claims pursuant to the
       EPCA;

   (9) Delphi's alleged harm and damages were due to, and
       caused by, events, conditions, instrumentalities or
       omisssions of individuals or entities other than the
       Appaloosa defendants;

  (10) Delphi has failed to mitigate its alleged damages;

  (11) Delphi is not entitled to specific performance because it
       cannot, currently or at the time of judgment in this
       action, fulfill all of the conditions of the Investment
       Agreement; and

  (12) Delphi's claims for specific performance are barred in
       whole or in part by the doctrine of impossibility.

In view of these defenses, Mr. Shore says, Appaloosa brings these
counterclaims against Delphi to recover damages caused by
Delphi's material and willful breaches of the EPCA:

     * Delphi willfully violated the EPCA and thwarted
       Appaloosa's contractual expectation of investing in a
       viable Delphi that was separated from its wholesale
       dependence on and control by General Motors -- by bringing
       GM in for more than $2,600,000,000 of long-term, non-
       market financing;

     * Delphi violated other provisions of the EPCA including     
       its obligation to obtain exit financing on the terms
       agreed to by the parties, which would have provided Delphi  
       with the liquidity it clearly needs while at the same time
       not saddling it with interest payments beyond its capacity
       to repay; and

     * as a result of Delphi's multiple breaches, Appaloosa
       terminated the EPCA for a cause, triggering Delphi's
       obligation to pay $82,500,000 Alternate Transaction Fee
       and other transaction expenses as those terms are defined
       in the EPCA.

According to Mr. Shore, on Jan. 30, 2008, Delphi approached ADAH
with an exit financing proposal reflecting its agreement with GM
and contemplating that $1,700,000,000 would be raised from the
public markets.  At a meeting on Feb. 6, ADAH expressed its
concerns with the proposal, including that it:

   (i) contemplated higher interest than permitted under the
       December 10, 2007 EPCA,

  (ii) anticipated issuing the first and second lien paper at a
       significant original issue discount,

(iii) overly concentrated GM's participation in the capital
       structure, and

  (iv) left Delphi insufficiently capitalized.

ADAH also expressed concern that GM's participation to that
degree would undermine a key objective of Delphi's reorganization
plan, which was for the company to disentangle itself from its
former parent and that such participation might also threaten the
execution of Delphi's portion of the business plan that
contemplated increased penetration of non-GM customers as a
result of no longer being a "GM captive."

Delphi, however, ignored those concerns by filing a motion under
Section 1142(b) of the Bankruptcy Code seeking an order, among
other things, that an exit financing that would provide for
additional funding by GM complies with the Plan and the EPCA.  
Mr. Shore says that the Court denied the Motion and acknowledged
at the hearing that the $2,000,000,000 in additional notes to GM
appeared to be outside the ordinary course of business, which is
precluded by paragraph 5(p)(ii) of the EPCA.  Mr. Shore adds that
changing the terms to have a GM subsidiary, GM Product Services,
Inc., to hold the Delphi-issued note, was still in violation of
the EPCA as (i) the GMPSI Proposal was, in reality, still an
agreement with GM, and provides for greater involvement and
control by GM, and (ii) Delphi obtained debt financing from
GMPSI, which was not a financial institution.

UBS seeks damages from Delphi arising from its breach of the
EPCA.  Other than Goldman Sachs, the Plan Investors want their
proportionate share from the $82,500,000 Alternative Transaction
Fee.  Goldman Sachs seeks reimbursement of $798,571 and Merrill
Lynch seeks an undisclosed amount for fees and expenses of
counsel in connection with investigating, negotiating, and
preparing to complete the transactions contemplated by the EPCA.

                         About Delphi Corp.

Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ)
-- http://www.delphi.com/-- is the single supplier of vehicle
electronics, transportation components, integrated systems and
modules, and other electronic technology.  The company's
technology and products are present in more than 75 million
vehicles on the road worldwide.  Delphi has regional
headquarters in Japan, Brazil and France.

The company filed for Chapter 11 protection on Oct. 8, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-44481).  John Wm. Butler Jr.,
Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden,
Arps, Slate, Meagher & Flom LLP, represent the Debtors in their
restructuring efforts.  Robert J. Rosenberg, Esq., Mitchell A.
Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP,
represent the Official Committee of Unsecured Creditors.  As of
June 30, 2008, the Debtors' balance sheet showed $9,162,000,000
in total assets and $23,742,000,000 in total debts.

The Court approved Delphi's First Amended Joint Disclosure
Statement and related solicitation procedures for the
solicitation of votes on the First Amended Plan on Dec. 20,
2007.  The Court confirmed the Debtors' First Amended Plan on
Jan. 25, 2008.  The Plan has not been consummated after a group
led by Appaloosa Management, L.P., backed out from their
proposal to provide $2,550,000,000 in equity financing to
Delphi.

(Delphi Bankruptcy News, Issue No. 143; Bankruptcy Creditors'
Service Inc., http://bankrupt.com/newsstand/or 215/945-7000)


D'ESPRIT INC: Case Summary & 7 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: D'Esprit Inc.
        428 South 3rd Avenue
        Tucson, AZ 85701

Bankruptcy Case No.: 08-1161

Type of Business: The Debtor has a real estate business.

Chapter 11 Petition Date: September 3, 2008

Court: District of Arizona (Tucson)

Debtor's Counsel: Jeffrey H. Greenberg, Esq.
                  Stubbs & Schubart PC
                  340 N Main Ave.
                  Tucson, AZ 85701
                  Tel 520-623-5466
                  Fax 520-882-3909
                  Email jgreenberg@stubbsschubart.com

Estimated Assets: $22,000,000

Estimated Debts: $2,489,391

Debtor's list of its 7 Largest Unsecured Creditors:

   Entity                        Nature of Claim   Claim Amount
   ------                        ---------------   ------------

Wells Fargo Bank NA                                $1,830,000
Trustee for Strctrd. Asset
Mortgage Investment II Inc.
2780 Lake Vista Drive
Lewis Hill, TX 75067

Everest Mortgage                 Bank Loan           $366,000
6141 North Pomona Road
Tucson, AZ 85704

Wells Fargo Business             Trade Debt          $125,891
Direct Operations
Attn:Customer Service
P.O. Box 348750
Sacramento, CA 95834

Old Pueblo Investments           Bank Loan           $135,500

Semper Romanus LLC               Bank Loan            $12,000

Canyon State Equity Inc.         Trade Debt           $10,000

H. Alan Day Jr.                  Bank Loan            $10,000


DISTRIBUTED ENERGY: Northern Power Unit Will Keep Workers
---------------------------------------------------------
Mel Huff at Times Argus reports that Northern Power Systems, Inc.,
will keep its 91 employees, after the company was sold by
Distribution Energy Systems Corp. to CB Wind Acquisition Corp.

As reported in the Troubled Company Reporter on Aug. 28, 2008,
Distribution Energy completed the sale of substantially all of the
assets of Northern Power to CB Wind for $12,900,000.  CB Wind has
changed its corporate name to Northern Power Systems, Inc.,
according to Times Argus.  The report adds that the sale brought
Northern Power out of Chapter 11 protection.

"They wanted to keep the entire team, including the management,
together.  We have a really large demand that we're trying to
(meet).  We've really just been capital-challenged.  Now that we
have a good financial partner, we expect to be able to grow our
staff," Times Argus quoted Northern Power Systems' Marketing
Director Maureen McCracken as saying.

Northern Power designed and built a variety of power generation
systems in the past, but "in the last 12 to 18 months, we've
developed a laser focus on wind. This is where we expect to
continue to grow" as "there's an excellent market for wind
turbines in general, and there's great demand for our Northwind
100," Times Argus relates, citing Ms. McCracken.

Based in Wallingford, Connecticut, Distributed Energy Systems
(Nasdaq: DESC) -- http://www.distributed-energy.com/-- through          
its subsidiaries, engages in the design, development, manufacture,
and sale of on-site hydrogen gas delivery systems worldwide.

Distributed Energy Systems Corp. and its wholly owned subsidiary,
Northern Power systems Inc., filed for Chapter 11 bankruptcy
protection on May 4, 2008 (Bankr. D. Del. Lead Case No. 08-11101).  
Robert S. Brady, Esq., and Robert F. Poppiti, Jr., at Young,
Conaway, Stargatt & Taylor represent the Debtors in their
restructuring efforts.  The Debtors selected Epiq Bankruptcy
Solutions LLC as their claims agent.  The U.S. Trustee for Region
3 appointed three creditors to serve on an Official Committee of
Unsecured Creditors.  Schuyler G. Carroll, Esq., Robert M. Hirsh,
Esq. , and Karen McKinley, Esq., at Arent Fox LLP, in New York,
and John V. Fiorella, Esq., Charles C. Brown, III, Esq., and "J"
Jackson Shrum, Esq., at Archer & Greiner, P.C., in Wilmington,
Delaware, represent the Committee.  The Debtors disclosed in its
schedules, assets of $19,593,387 and debts of $43,558,713.


DUNMORE HOMES: Dispute on JMP Bid to File Tardy Claim for $2MM
--------------------------------------------------------------
JMP Realty Trust, Inc., seeks leave from the United States
Bankruptcy Court for the Southern District of New York to file a
late claim against Dunmore Homes, Inc. in relation to a certain
loan obligation no later than September 15, 2008.

JMP Realty relates that its Claim originated from a May 2007
$2,000,000 loan to the Debtor's predecessor, Dunmore Homes Inc.
California, from JMP Realty's affiliate, JMP Securities LLC.   
Dunmore California is now known as DHI Development.  The JMP Loan
Note was endorsed to JMP Realty on May 23, 2008.

JMP Realty says the Loan is not secured by a lien on the property
of Dunmore California or the Debtor but (i) is guaranteed by
Sidney Dunmore, and (ii) is subject to five deeds of trust
granted by third party accomodators Dunmore Land Company LLC,
Dunmore Fullerton Ranch LLC, Dunmore Highlands LLC, and Dunmore
Montecito LLC.  The accomodators are affiliates of Dunmore
California.

As of August 12, 2008, JMP Realty informs the Court, one of the
Accomodation Deeds of Trust granted by Dunmore Land Company was
reconveyed in exchange for a $650,000 payment while three of the
deeds have been extinguished through foreclosure of lenders
holding senior deeds of trust on the subject properties.  JMP
Realty believes the remaining Accomodation Deed of Trust lacks
value.

JMP Realty, however, believes that the guaranty executed by Mr.
Dunmore is valuable.

Representing JMP Realty, Frank T. Pepler, Esq., at Pepler
Mastromonaco LLP, in San Francisco, California, relates that Mr.
Dunmore has noted in his proof of claim that he had made payments
aggregating $942,099 on account of the JMP Loan.  JMP avers the
aggregate amount of the payments it has received for application
to the Loan is $1,106,626, including the $650,000 received on
account of reconveyance of one of the Dunmore Land Company Deed.

Mr. Pepler asserts that due to transactions unilaterally
consummated by the Debtor and Dunmore California, JMP Realty now
has rights of recovery against both Dunmore California and the
Debtor who had assumed the obligations of Dunmore California in a
sale transaction consummated in the filing of the Debtor's
bankruptcy case.  One of the liabilities the Debtor assumed was
the $2,000,000 note obligation of Dunmore California to JMP
Realty.

JMP Realty asserts that the Debtor has conceded the JMP Claim in
their initial and amended largest creditors list as an
undisputed, liquidated and non-contingent claim.  

In support of the JMP Realty's request, David Shapiro, a senior
JMP official and a member of the Investment Committee of JMP,
says he saw the Debtor's initial and amended largest unsecured
creditors list and avers that the Lists included the $2,000,000
JMP Claim.  Mr. Shapiro believed that the JMP Claim had been
"allowed" and that JMP need not file any proof of claim in the
Debtor's case.

JMP Realty informs the Court that it only learned of the
March 30, 2008 Bar Date on August 1, 2008, the day after it
formally hired a counsel.  JMP Realty says it hasn't been able to
locate any evidence of the Bar Date Notice served on it, but does
not contest that fact that the service list says that service was
affected.

"Granting JMP's Motion for Leave will not materially affect in
any way the Debtor's rights and obligations to third parties
under its Plan, and will not draw the Debtor or the Liquidating
Trustee into any squabble that they are not already squarely in
the middle of already," Mr. Pepler avers.

He maintains that there will be essentially no dilutive effect on
other creditors of JMP Realty is allowed to file an unsecured
claim as the Debtor's Schedules and Statements show an aggregate
of $239,000,000 in unsecured claims, including the $2,000,000 JMP
Claim.

There will also be, Mr. Pepler adds, no genuine or material
change in the Liquidating Trustee's rights against Mr. Dunmore or
Mr. Dunmore's rights against the Debtor that will result from the
filing of a JMP claim.  He cites that Mr. Dunmore has already
filed a proof of claim asserting offset rights of up to $2.5
million on account of his obligations to JMP Realty.

                   Debtor and Committee Object

On behalf of the Debtor and the Official Committee of Unsecured
Creditors, Debra I. Grassgreen, Esq., at Pachulski Stang Ziehl &
Jones LLP, in San Francisco California, cannot come close to
meeting the standards for excusable neglect for its failure to
file a timely proof of claim.  

Ms. Grassgreen argues that JMP Realty made a conscious, informed
decision to ignore the Debtor's Chapter 11 case and the Bar Date.  
She took note of Mr. Shapiro's acquisition of the Debtor's list
of 20 largest unsecured creditors.  ""Mr. Shapiro does not supply
the Court with an explanation of how he acquired the Lists."

Ms. Grassgreen contends that Mr. Shapiro is not a bankruptcy
novice and may have had some sophisticated contact with
bankruptcy matters that involved the advice of counsel on when to
file proofs of claim.  She adds that for some unexplained reason,
JMP Realty formally engaged bankruptcy counsel nearly nine months
after the Debtor's Chapter 11 case was filed and around eight
months after JMP Realty admitted it has learned of the Debtor's
bankruptcy filing in December 2007.  "It is curious that JMP
suddenly bothered with employing counsel at the end of July of
2008."

Ms. Grassgreen asserts JMP Realty will not be prejudiced if the
Court denies JMP Realty's request because as a result of an
approved settlement with the trustee of DHI Development, JMP
Realty can still file a timely claim in the DHI bankruptcy case
and receive the very same distribution as it would from the
Debtor's Chapter 11 case.

In contrast, Ms. Grassgreen notes, the Debtor's creditors will
suffer profound prejudice because the filing of a JMP claim will
trigger offset rights by Mr. Dunmore against the Debtor.  Thus,
if the Court grants JMP Realty's request, the only beneficiary
will be Mr. Dunmore to the detriment of the Debtor's estate and
other creditors.

Based on these reasons, the Debtor and the Committee asks the
Court to deny JMP Realty's Request.

              S. Dunmore Supports JMP Realty's Request

Mr. Dunmore avers that from the outset of the Debtor's bankruptcy
case, the Debtor has readily acknowledged the existence of the
debt due and owing by the Debtor to JMP Securities.  "For the
Debtor to assert that it should benefit from any inadvertency by
JMP Securities or its counsel in not filing a proof of claim," he
says, "that . . . assertion is simply wrong."

Mr. Dunmore notes that the Debtor made specific reference to the
monthly interest payments he made on his obligation to JMP
Securities in its monthly operating reports.

Mr. Dunmore relates that his Claim No. 307 referenced offset
rights as a consequence of his payments on the Debtor's loan to
JMP Securities.  Mr. Dunmore contends that his standing alone can
be treated as an informal proof of claim, especially coupled with
the Debtor's monthly operating reports which acknowledged the JMP
Securities debt and the fact that he paid directly paid for it.

Accordingly, Mr. Dunmore asks the Court to grant JMP Realty's
Request.

                       JMP Realty Talks Back

On behalf of JMP Realty, Mr. Pepler contends that although the
Debtor's and the Committee's Objection is "dripping in sarcasm
and speculation," it fails to explain why permitting JMP Realty
to file a late claim will prejudice the Debtor's estate.

"The Joint Opposition looks instead on how a bar on JMP's
undisputed claim could give the Debtor an unforeseen advantage in
its battle with Sidney Dunmore," Mr. Pepler says.

If JMP Realty is permitted to file a claim, notwithstanding the
effect of the Bar Date, the Debtor, its estate, JMP Realty, and
Mr. Dunmore will simply be restored to the position that they
were before March 20, 2008 with a clearer picture of what's in
store for them, Mr. Pepler points out.  He adds that the Debtor
and Liquidation Trustee are attempting to preserve a defense that
they may have in their future litigation with Mr. Dunmore.

Mr. Pepler relates that as incredulous as it may be to the Debtor
and the Committee, JMP Realty had been proceeding in the good
faith belief that it did not need to take action in a bankruptcy
case in which its claim had been deemed to have been allowed.  
JMP Realty was uninformed or perhaps underinformed, he maintains.
JMP Realty says it is not suggesting that the Bar Date Notice is
missing from the Debtor's service list but that it had a good
faith belief that its claim had been scheduled as undisputed and
deemed allowed, and that it need to take no further action to
preserve its rights.

In hiring a bankruptcy counsel, JMP says it is only seeking to
preserve the benefit of the bargain it struck when making a
$2,000,000 unsecured loan to the Debtor's predecessor.

JMP Realty's case is ideal in granting the late claim request
because despite the fact that the Bar Date ran more than five
months ago, there will be no conceivable effect on unsecured
creditor distributions flowing from one more unsecured claim
because distributions will not be made for some time, Mr. Pepler
insists.

Based in Granite Bay, California, Dunmore Homes Inc. is a
privately-owned homebuilder.  The company filed for Chapter 11
protection on Nov. 8, 2007 (Bankr. S.D.N.Y. Case No. 07-13533).
Maria A. Bove, Esq., and Debra I. Grassgreen, Esq., at Pachulski
Stang Ziehl & Jones LLP, represent the Debtor in its restructuring
efforts.  The Official Committee of Unsecured Creditors has
selected Morrison & Foerster LLP as its counsel in this bankruptcy
proceeding.

In January 2008, the U.S. Bankruptcy Court for the Southern
District of New York ordered the transfer of Debtor's Chapter 11
case to the U.S. Bankruptcy Court for the Eastern District of
California, Sacramento Division.  The Debtor filed its plan of
liquidation and an accompanying disclosure statement on March 21,
2008.  The company amended the Plan on April 24.

The California Bankruptcy Court approved Dunmore's Disclosure
Statement on June 12, 2008 as containing "adequate information"
within the meaning of Section 1125 of the Bankruptcy Code.  A
hearing for August 12 has been set to consider confirmation of the
Plan.

The Debtor disclosed $20,743,147 in total assets and $250,252,312
in total debts in its schedules of assets and liabilities filed
with the Court.


DUNMORE HOMES: $1.5MM Lender Receivable Offset Stipulation OK'ed
----------------------------------------------------------------
Sidney B. Dunmore and Dunmore Homes, Inc., entered into a
prepetition loan agreement which was later modified and approved
by the United States Bankruptcy Court for the Southern District of
New York.

On March 18, 2008, Mr. Dunmore filed a proof of claim asserting
offset and contribution rights against the Debtor as to certain
debts, existing as of the Petition Date, for which Mr. Dunmore is
both a guarantor and co-debtor.

Mr. Dunmore asserts that to the extent he satisfies any direct
obligations or co-obligations of the Debtor, he is entitled to
contribution from the Debtor or exercise setoff rights against a
lender receivable in the Loan Agreement.

The Debtor and Mr. Dunmore are co-guarantors of a loan totaling
$11,731,000 made by Affinity Bank to Dunmore-Orchard LLC, a
California limited liability company, pursuant to a certain
construction loan agreement between Affinity and Dunmore-Orchard.  
The Orchard Loan was secured by a deed of trust on real property.

To induce Affinity Bank to make the Orchard Loan, both Mr. Dunmore
and the Debtor each executed a continuing guaranty in favor of
Affinity Bank.

However, as of August 2007, Affinity Bank contended that Dunmore
Orchard defaulted under the terms of the Orchard Loan and related
agreements.  As a result, Affinity Bank filed a complaint against
Dunmore Orchard, Mr. Dunmore, and the Debtor in the Yuba County
Superior Court.

Mr. Dunmore entered into a forbearance agreement with Affinity
Bank on December 18, 2007, which provided, that in satisfaction
of both Mr. Dunmore's and the Debtor's Guaranties, Mr. Dunmore
agreed to pay Affinity Bank $3,000,000, plus transaction costs
amounting to $15,000.  In addition, Mr. Dunmore conveyed a
security interest in real property to Affinity Bank.

In accordance with the terms of the Lender Receivable, Mr.
Dunmore provided a setoff notice to the Debtor describing the
general terms of the proposed Forbearance Agreement and the
intended release of any of the Debtor's obligations to Affinity
Bank.

Affinity Bank previously filed a proof of claim in the Debtor's
Chapter 11 case for $10,860,432.

As a consequence of the Forbearance Agreement, Affinity Bank
withdrew its Proof of Claim with prejudice and promised that it
will not file a proof of claim against the Chapter 7 bankruptcy
estate of DHI Development, Inc.

To resolve their issues, the Debtor and Mr. Dunmore stipulate
that the Debtor's obligations of any sums owing to Affinity Bank
have already been satisfied by Mr. Dunmore, and that Mr. Dunmore
is entitled to an offset on the Lender Receivable amounting to
$1,507,500.

Therefore, the amount determined to be due and owing on the
Lender Receivable is reduced by the sum of $1,507,500.

The Court approves the parties' stipulation.

Based in Granite Bay, California, Dunmore Homes Inc. is a
privately-owned homebuilder.  The company filed for Chapter 11
protection on Nov. 8, 2007 (Bankr. S.D.N.Y. Case No. 07-13533).
Maria A. Bove, Esq., and Debra I. Grassgreen, Esq., at Pachulski
Stang Ziehl & Jones LLP, represent the Debtor in its restructuring
efforts.  The Official Committee of Unsecured Creditors has
selected Morrison & Foerster LLP as its counsel in this bankruptcy
proceeding.

In January 2008, the U.S. Bankruptcy Court for the Southern
District of New York ordered the transfer of Debtor's Chapter 11
case to the U.S. Bankruptcy Court for the Eastern District of
California, Sacramento Division.  The Debtor filed its plan of
liquidation and an accompanying disclosure statement on March 21,
2008.  The company amended the Plan on April 24.

The California Bankruptcy Court approved Dunmore's Disclosure
Statement on June 12, 2008 as containing "adequate information"
within the meaning of Section 1125 of the Bankruptcy Code.  A
hearing for August 12 has been set to consider confirmation of the
Plan.

The Debtor disclosed $20,743,147 in total assets and $250,252,312
in total debts in its schedules of assets and liabilities filed
with the Court.


ETELOS INC: June 30 Balance Sheet Upside-Down by $15,815,000
------------------------------------------------------------
Etelos Inc.'s consolidated balance sheet at June 30, 2008, showed
$2,252,000 in total assets and $18,067,000 in total liabilities,
resulting in a $15,815,000 stockholders' deficit.

At June 30, 2008, the company's consolidated balance sheet also
showed strained liquidity with $1,863,000 in total current assets
available to pay $14,607,000 in total current liabilities.

The company reported a net loss of $21,573,000 on revenue of
$22,000 for the second quarter ended June 30, 2008, compared with
a net loss of $572,000 on revenue of $106,000 in the corresponding
period of 2007.

The decrease in revenues is due in part to reductions in revenues
from the sale of newsletters and related hosting services and a
one-time sale of software in June 2007.  

The company incurred $13,444,000 in costs for the quarter ended
June 30, 2008, associated with completing the merger with Tripath
Technology Inc.  There were no similiar costs in 2007.

Net interest expense was $5,567,000 for the quarter ended June 30,
2008, compared to $58,000 for the comparable period of 2007.  The
increase in interest expense was primarily due to multiple rounds
of convertible debt financing completed during 2007 and the first
half of 2008.

                    Reverse Merger Transaction

On April 23, 2008, Etelos Incorporated, a Washington corporation
(Etelos-WA), merged with and into Tripath Technology Inc., a
Delaware corporation.  Prior to the merger, Tripath Technology
Inc. had been a debtor-in-possession in a Chapter 11 bankruptcy
proceeding in the United States Bankruptcy Court for the Northern
District of California.  In connection with the bankruptcy
proceeding, all assets of Tripath were transferred to a trustee
for liquidation and all liabilities of Tripath were discharged.  
Accordingly, at the time of the merger, Tripath had no assets or
liabilities.

The surviving corporation in the merger changed its name to Etelos
Inc. and its fiscal year to Dec. 31.  Etelos Inc., as the
surviving corporation, will conduct the business and operations
previously conducted by Etelos-WA.

Full-text copies of the company's consolidated financial
statements for the quarter ended June 30, 2008, are available for
free at http://researcharchives.com/t/s?31a0

                        About Etelos Inc.

Headquartered in San Mateo, Calif., Etelos Inc. (OTC BB: ETLO) --
http://www.etelos.com/-- is a developer and distributor of Open  
Standards software.  Etelos development products include tools for
Web developers, business and individual users such as the Etelos
Application Server(TM) and the Etelos Development Environment(TM).
EAS and EDE support many common application languages and also
supports a simple to use scripting language, the English
Application Scripting Engine(TM).  


EXIDE TECHNOLOGIES: Wants Deadline to Remove Actions Extended
-------------------------------------------------------------
Pursuant to Section 1452 of the Judiciary and Judicial Procedures
Code and Rules 9006 and 9027 of the Federal Rules of Bankruptcy
Procedure, Exide Technologies, Inc., asks the U.S. Bankruptcy
Court for the District of Delaware to further extend the time by
which it may remove certain actions with respect to certain state
court cases by approximately 120 days, through and including
December 8, 2008.

According to James E. O'Neill, Esq., at Pachulski Stang Ziehl &
Jones LLP, in Wilmington, Delaware, the Debtor was served with two
complaints on March 10, 2008, each filed in the Court of Common
Please of Berks County, Pennsylvania, specifically:

   (a) Anh-Thi Winkler and William F. Winkler vs. Berks Products
       Corp., Exide Technologies, and Empire Steel Casting, Inc.,
       Case No. 08-2580; and

   (b) Christopher Orth vs. Berks Products Corp., Exide
       Technologies, and Empire Steel Casting, Inc., Case No. 08-
       2584.

The Debtor seeks a further extension of the removal deadline to
investigate the asserted claims and to determine whether removal
is appropriate, Mr. O'Neill explains.

The Debtor has reason to suspect, and believes, that the claims
asserted in the State Court Cases arose before the Petition Date;
are enjoined or barred by orders of the Court; and are discharged
pursuant to the Confirmation Order or Bankruptcy Code, Mr.
O'Neill adds.  However, the allegations in the State Court Cases
are sufficiently vague, ambiguous and incomplete that the Debtor
cannot make a definitive assessment as to whether or not the
asserted causes of action are related to or arise in the Chapter
11 cases.  

The Debtor does not wish to file a precipitous notice of removal,
nor does it wish to waive its statutory right to remove the State
Court Cases if, as suspected, they are barred and discharged by
the bankruptcy case, Mr. O'Neill maintains.

Although the State Court Cases have proceeded since the date of
the Debtor's prior extension of the removal deadline, no
discovery has yet taken place in those cases, Mr. O'Neill notes.

In a separate request, the Debtor also seeks a 120-day extension,
through and including December 5, 2008, of the time by which it
may remove a complaint filed July 8, 2008, titled Malcontento v.
Enersys, Inc., et al., Case No. 0806-5357, filed in the Court of
Common Pleas, Philadelphia, Pennsylvania.

Headquartered in Princeton, New Jersey, Exide Technologies
(NASDAQ: XIDE) -- http://www.exide.com/-- manufactures and  
distributes lead acid batteries and other related electrical
energy storage products.  The company filed for chapter 11
protection on Apr. 14, 2002 (Bankr. Del. Case No. 02-11125).  
Matthew N. Kleiman, Esq., and Kirk A. Kennedy, Esq., at Kirkland &
Ellis, and James E. O'Neill, Esq., at Pachulski Stang Ziehl &
Jones LLP represented the Debtors in their successful
restructuring.  The Court confirmed Exide's Amended Joint Chapter
11 Plan on April 20, 2004.  The plan took effect on May 5, 2004.  

At Dec. 31, 2007, the company's consolidated balance sheet
showed $2.426 billion in total assets, $1.989 billion in total
liabilities, $17.2 million in minority interest, and
$420.1 million in total stockholders' equity. (Exide Bankruptcy
News, Issue No. 109; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).

                          *     *     *

As reported by the Troubled Company Reporter on July 9, 2008,
Moody's Investors Service upgraded the Corporate Family and
Probability of Default Ratings of Exide Technologies, Inc. to B3
from Caa1.  Moody's raised the ratings on the company's asset
based revolving credit facility to Ba2 from Ba3, the senior
secured term loans to Ba3 from B1, and the senior secured junior-
lien notes to B3 from Caa1.  The outlook is stable.  According to
Moody's, the upgrade reflects Exide Technologies' improved credit
metrics that have been achieved as a result of cost reduction
initiatives and successful pricing actions which have offset the
impact of increasing lead costs on the company's operations.  
Moody's explained the actions have reduced financial risk and
positioned the company to generate credit metrics consistent with
the B3 rating over the intermediate term.  While Exide  benefits
from its geographic and customer diversification, it remains
exposed to cyclical industry conditions, and commodity pricing
pressures.


EXIDE TECHNOLOGIES: Wants Oct. 31 Extension to Review Claims
------------------------------------------------------------
Exide Technologies Inc. asks the U.S. Bankruptcy Court for the
District of Delaware to extend through October 31, 2008, the time
within which it may object to certain claims.

More than 6,100 proofs of claim totaling roughly $4,400,000,000,
were filed in the Debtor's bankruptcy case.  Moreover, the Debtor
has filed 50 omnibus claims objections, two individual objections
to claims, and has resolved numerous other claims, James E.
O'Neill, Esq., at Pachulski Stang Ziehl & Jones LLP, in
Wilmington, Delaware, notes.

Through the Debtor's efforts -- along with the Postconfirmation
Committee of Unsecured Creditors -- 6,037 claims have been
reviewed, reconciled and resolved, reducing the total amount of
outstanding Claims by over $3,400,000,000, Mr. O'Neill discloses.  

The Debtor has also completed 17 quarterly distributions to
creditors under its Joint Plan of Reorganization, consisting of
distributions on 2,590 claims for aggregate amount of
$1,660,000,000.

However, Mr. O'Neill states, despite this substantial progress,
the Debtor requires additional time to review and resolve 85
remaining Claims.

The Claims Objection Deadline extension will provide the Debtor
and the Committee with necessary time to continue to evaluate the
Claims filed against the estate, prepare and file additional
objections to Claims and, where possible, consensually resolve
Claims, Mr. O'Neill states.

The Court will convene a hearing on September 16, 2008, at 3:00
p.m., to consider the Debtor's request.  Pursuant to Del.Bankr.LR
9006-2, the Debtor's Claim Objection Deadline is automatically
extended until the conclusion of that hearing.

Headquartered in Princeton, New Jersey, Exide Technologies
(NASDAQ: XIDE) -- http://www.exide.com/-- manufactures and  
distributes lead acid batteries and other related electrical
energy storage products.  The company filed for chapter 11
protection on Apr. 14, 2002 (Bankr. Del. Case No. 02-11125).  
Matthew N. Kleiman, Esq., and Kirk A. Kennedy, Esq., at Kirkland &
Ellis, and James E. O'Neill, Esq., at Pachulski Stang Ziehl &
Jones LLP represented the Debtors in their successful
restructuring.  The Court confirmed Exide's Amended Joint Chapter
11 Plan on April 20, 2004.  The plan took effect on May 5, 2004.

At Dec. 31, 2007, the company's consolidated balance sheet
showed $2.426 billion in total assets, $1.989 billion in total
liabilities, $17.2 million in minority interest, and
$420.1 million in total stockholders' equity. (Exide Bankruptcy
News, Issue No. 109; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).
                          *     *     *

As reported by the Troubled Company Reporter on July 9, 2008,
Moody's Investors Service upgraded the Corporate Family and
Probability of Default Ratings of Exide Technologies, Inc. to B3
from Caa1.  Moody's raised the ratings on the company's asset
based revolving credit facility to Ba2 from Ba3, the senior
secured term loans to Ba3 from B1, and the senior secured junior-
lien notes to B3 from Caa1.  The outlook is stable.  According to
Moody's, the upgrade reflects Exide Technologies' improved credit
metrics that have been achieved as a result of cost reduction
initiatives and successful pricing actions which have offset the
impact of increasing lead costs on the company's operations.  
Moody's explained the actions have reduced financial risk and
positioned the company to generate credit metrics consistent with
the B3 rating over the intermediate term.  While Exide  benefits
from its geographic and customer diversification, it remains
exposed to cyclical industry conditions, and commodity pricing
pressures.


EXIDE TECHNOLOGIES: Settles $418,000 EPA Claim on Superfund Site
----------------------------------------------------------------
Exide Technologies Inc. obtained approval from the U.S. Bankruptcy
Court for the District of Delaware of a settlement agreement it
entered into with the U.S. government, on behalf of the
Environmental Protection Agency.  

The U.S. Government, on behalf of EPA and the National Oceanic
and Atmospheric Administration, Department of Commerce, filed in
2003, an administrative claim against the Debtor in its Chapter
11 case, for $418,216.  The U.S. Government alleged that the use
of hazardous substance was involved in the Debtor's manufacturing
and distribution operations at two of its sites:

    * a lead-acid battery manufacturing plant in Hamburg,
      Pennsylvania -- the Price Battery Superfund Site, ; and

    * a 0.5549-acre parcel of property located in Hamburg, Berks
      County, Pennsylvania -- the Broomworks Superfund Site.

The U.S. Government asserted that the Administrative Claim
relates to costs incurred by EPA for certain removal or remedial
action at the Broom Works Site and at the Debtor-owned
portions of the Price Battery Site between the Petition Date and
the Confirmation Date.

Consequently, the Debtor objected when the U.S. Government sought
payment of the Administrative Claim.

To settle their dispute, the Debtor and EPA agree that, in full
satisfaction of the Administrative Claim:

   a. The Debtor will pay EPA $255,000 -- the Allowed
      Administrative Claim -- to the U.S. Government, on behalf
      of EPA.

   b. the Allowed Administrative Claim will be deposited by EPA
      into a Price Battery Site special account within an EPA
      hazardous substance superfund.

   c. upon payment in full of the Allowed Administrative Claim,
      the U.S. Government's Administrative Claim Motion will be
      deemed settled and withdrawn.

   d. the parties mutually agree not to sue, subject to certain
      limitations and reservations, with respect to the matters
      addressed in the Settlement Agreement.

The Parties agree that the Debtor is entitled to protection from
contribution actions or claims as provided by Section 113(f)(2)
of the Comprehensive Environmental Response, Compensation, and
Liability Act -- CERCLA.  

Headquartered in Princeton, New Jersey, Exide Technologies
(NASDAQ: XIDE) -- http://www.exide.com/-- manufactures and  
distributes lead acid batteries and other related electrical
energy storage products.  The company filed for chapter 11
protection on Apr. 14, 2002 (Bankr. Del. Case No. 02-11125).  
Matthew N. Kleiman, Esq., and Kirk A. Kennedy, Esq., at Kirkland &
Ellis, and James E. O'Neill, Esq., at Pachulski Stang Ziehl &
Jones LLP represented the Debtors in their successful
restructuring.  The Court confirmed Exide's Amended Joint Chapter
11 Plan on April 20, 2004.  The plan took effect on May 5, 2004.

At Dec. 31, 2007, the company's consolidated balance sheet
showed $2.426 billion in total assets, $1.989 billion in total
liabilities, $17.2 million in minority interest, and
$420.1 million in total stockholders' equity. (Exide Bankruptcy
News, Issue No. 109; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).

                          *     *     *

As reported by the Troubled Company Reporter on July 9, 2008,
Moody's Investors Service upgraded the Corporate Family and
Probability of Default Ratings of Exide Technologies, Inc. to B3
from Caa1.  Moody's raised the ratings on the company's asset
based revolving credit facility to Ba2 from Ba3, the senior
secured term loans to Ba3 from B1, and the senior secured junior-
lien notes to B3 from Caa1.  The outlook is stable.  According to
Moody's, the upgrade reflects Exide Technologies' improved credit
metrics that have been achieved as a result of cost reduction
initiatives and successful pricing actions which have offset the
impact of increasing lead costs on the company's operations.  
Moody's explained the actions have reduced financial risk and
positioned the company to generate credit metrics consistent with
the B3 rating over the intermediate term.  While Exide  benefits
from its geographic and customer diversification, it remains
exposed to cyclical industry conditions, and commodity pricing
pressures.


FEDDERS CORP: Insurers Seek Relief From Confirmation Order
----------------------------------------------------------
Bankruptcy Data reports that Maryland Casualty Company and Liberty
Mutual Insurance Company filed with the U.S. Bankruptcy Court for
the District of Delaware, a motion for relief, pursuant to Rules
59 and 60 of the Federal Rules of Civil Procedure, from the order
confirming the bankruptcy plan of Fedders North America, Inc. and
its debtor-affiliates.

As reported by the Troubled Company Reporter on August 22, 2008,
the Hon. Brendan Linehan Shannon confirmed the Debtors'
liquidation plan, as modified.

The Plan and related settlement among the Term Lenders, the
Official Committee of Unsecured Creditors and the Debtors provide
for the liquidation and distribution of the Debtors' assets.
Under the Plan, Term Lenders, whose claims total $45.6 million and
are secured by their duly perfected liens on substantially all of
the Debtors' assets, have agreed to waiver their Adequate
Protection Claims, which could range from $9 million to more than
$20 million.  The Term Lenders, in turn, will receive roughly 53%
to 60% of their Secured Claims.  The Term Lenders will also
provide $1.8 million in cash to a liquidating trust to pay down
general unsecured claims.  The GUC Liquidating Trust will also
receive the avoidance actions.  General unsecured creditors
asserted $2.6 billion in claims.

All classes of creditors impaired under the Plan have voted to
accept the Plan.  Holders of Equity Interests in Class 56 have
rejected the Plan.

Objections to the confirmation of the Plan have filed by, among
others, the United States Trustee and the Debtors' insurers.

The U.S. Trustee argued that the Plan does not meet the
substantive consolidation standard set forth by the Third Circuit
in In re Owens Corning, 419 F.3d 195 (3d Cir. 2007); and the
release provisions under the Plan is not permissible.

The Debtors, however, argued that their assets and liabilities are
sufficiently scrambled that separating them is cost-prohibitive
and would hurt all creditors.  The Debtors also noted that the
Term Lenders and the Committee support substantive consolidation.  
The Debtors noted that the Term Lenders are entitled to a release
for postpetition conduct.

According to Bankruptcy Data, the modified Plan was not circulated
in advance of the hearing.  Bankruptcy Data states that Maryland
Casualty and Liberty Mutual were given a short time to review the
modified Plan.

Fireman's Fund Insurance filed a joinder to Maryland Casualty and
Liberty Mutal's motion for relief, according to Bankruptcy Data.  
The Court will convene a hearing on Oct. 6, 2008, to consider the
Insurers' request, the report states.

                     About Fedders Corporation

Based in Liberty Corner, New Jersey, Fedders Corporation --
http://www.fedders.com/-- manufactures and markets air
treatment products, including air conditioners, air cleaners,
dehumidifiers, and humidifiers.  The company has production
facilities in the United States in Illinois, North Carolina, New
Mexico, and Texas and international production facilities in the
Philippines, China and India.

The company and several affiliates filed for Chapter 11 protection
on Aug. 22, 2007, (Bankr. D. Del. Lead Case No. 07-11182).  Norman
L. Pernick, Esq., and J. Kate Stickles, Esq., at the Wilmington,
Delaware office of Cole, Schotz, Meisel, Forman & Leonard P.A.;
and Irving E. Walker, Esq., at Cole Schotz's Baltimore, Maryland,
office represent the Debtors in their restructuring efforts.  The
Debtors have selected Logan & Company Inc. as claims and noticing
agent.  The Official Committee of Unsecured Creditors is
represented by Brown Rudnick Berlack Israels LLP.

When the Debtors filed for protection from creditors, they listed
total assets of $186,300,000 and total debts of $322,000,000.

The Debtors and their term lenders filed an amended joint plan of
liquidation on August 18, 2008.

Goldman Sachs Credit Partners LP serves as administrative agent
and collateral agent for the term lenders. Goldman is represented
by Stephen Karotkin, Esq., and Christina F. Pullo, Esq., at Weil,
Gotshal & Manges, LLP, in New York; and Mark D. Collins, Esq., at
Richards, Layton & Finger, PA, in Wilmington, Delaware.

Highland Capital Management LP is represented by Judith Elkin,
Esq., at Haynes and Boone LLP, in New York; and Thomas G.
Macauley, Esq., at Zuckerman Spaeder LLP in Wilmington.


FINOVA GROUP: Must Pay $81.2MM to Creditors, District Court Rules
-----------------------------------------------------------------
A U.S. District Judge in Delaware upheld on Aug. 26, 2008, the
ruling of the U.S. Bankruptcy Court for the District of Delaware
directing The Finova Group, Inc. to distribute to creditors 100%
of $81.2 million in remaining funds, William Rochelle of Bloomberg
News relates.

Finova has been winding down its business since March 2001.  It
listed $11.3 billion in debt, according to Mr. Rochelle.  In
August 2001, Mr. Rochelle recalls that the Debtor filed a
reorganization plan contemplating on paying creditors in full and
stockholders in part.

Mr. Rochelle says that uncertainty arose because under the plan,
the Debtor will liquidate remaining assets, distribute 95% of the
proceeds to noteholders and 5% to stockholders, assuming Finova
was solvent.  However, Finova appeared insolvent and reopened the
case promising only one-seventh of the amount needed to pay
creditors in full, Mr. Rochelle notes.

Mr. Rochelle notes that in June 2007, the Bankruptcy Court ruled
that the 5% of the remaining funds should not be paid to
stockholders but to noteholders.  The stockholders subsequently
appealed.

In November 2007, U.S. District Judge Joseph Farnan directed
Finova to suspend distributions while he decided the appeal, Mr.
Rochelle relates.

Judge Farnan's August 26 ruling is held up for 10 days to allow
stockholders to further take an appeal, the report says. Finova,
according to Mr. Rochelle, said that distribution to creditors
might be halted during an appeal to the Third U.S. Circuit Court
of Appeals.

                           About Finova

Headquartered in Scottsdale, Arizona, The Finova Group, Inc.,
provides commercial financing to small and mid-sized businesses;
other services include factoring, accounts receivable management,
and equipment leasing.  The firm has three segments: Commercial
Finance, Specialty Finance, and Capital Markets.  FINOVA targets
such markets as transportation, wholesaling, communication, health
care, and manufacturing. Loan write-offs had put the firm on
shaky ground.

The company and its debtor-affiliates and subsidiaries filed for
chapter 11 protection on March 7, 2001 (Bankr. Del. 01-00697).  
Pachulski, Stang, Ziehl, Young & Jones P.C. and Wachtell, Lipton,
Rosen & Katz represent the Official Committee of Unsecured
Creditors.  Daniel J. DeFranceschi, Esq., at Richards, Layton &
Finger, P.A., represents the Debtors.  FINOVA has since emerged
from Chapter 11 bankruptcy.  Financial giants Berkshire Hathaway
and Leucadia National Corporation (together doing business as
Berkadia) own FINOVA through the almost $6 billion lent to the
commercial finance company.  Finova is winding up its affairs.


FIRST DOMINION: Moody's Lifts Ratings on Three Notes to Ba3
-----------------------------------------------------------
Moody's Investors Service has upgraded these notes issued by First
Dominion Funding III:

Class Description: U.S. $20,000,000 Class B-1 Fixed Rate Notes Due
2014

   -- Prior Rating: A1

   -- Current Rating: Aa2

Class Description: U.S. $47,500,000 Class B-2 Floating Rate Notes
Due 2014

   -- Prior Rating: A1

   -- Current Rating: Aa2

According to Moody's, these rating actions are a result of the
ongoing delevering of the transaction.

In addition, Moody's has also downgraded the following notes:

Class Description: U.S. $7,000,000 Class D-1 Fixed Rate Notes Due
2014

   -- Prior Rating: Ba3

   -- Current Rating: Caa1

Class Description: U.S. $14,250,000 Class D-2 Floating Rate Notes
Due 2014

   -- Prior Rating: Ba3

   -- Current Rating: Caa1

Class Description: U.S. $10,000,000 Class D-3 Fixed Rate Notes Due
2014

   -- Prior Rating: Ba3

   -- Current Rating: Caa1

According to Moody's, these rating actions are a result of the
deterioration in the credit quality of the transaction's
underlying collateral pool which consists primarily of senior
secured loans and bonds.


FORD MOTOR: August 2008 Vehicle Sales Drop 25.6% to 151,021
-----------------------------------------------------------
Ford Motor Company reported total vehicle sales for August 2008 at
151,021, down 25.6% from August last year's 203,001 vehicle sales.    
Total August 2008 vehicle sales by brand, constituting Ford,
Lincoln, Mercury and Volvo, is 155,690 units, down 26.6% compared
to August last year's 212,120 vehicles.

Higher demand for the fuel-efficient Ford Focus and Ford Escape
continued in August, as consumers continued moving to smaller and
more fuel-efficient vehicles.

Ford Focus sales were up 23% and Escape sales were up 17% versus a
year ago, while the impact of a weak economy and lower demand for
large trucks and SUVs resulted in double-digit sales declines for
Ford and the auto industry.

"The Focus and Escape offer the features and fuel economy today's
consumer's want," said Jim Farley, Ford group vice president,
Marketing and Communications.

The 2009 Escape, with its new 2.5-liter four-cylinder engine and
six-speed transmission, delivers class-leading highway fuel
economy of 28 mpg -- matching the 2009 Toyota RAV4 and topping the
Honda CR-V.  The 2009 Escape Hybrid delivers 34 mpg in the city
and 31 mpg on the highway, making it the most fuel-efficient
utility vehicle available.

The 2009 Focus has similarly impressive fuel economy with an EPA
highway fuel economy of 35 mpg -- equal to the Toyota Corolla and
the smaller 2009 Honda Fit.

Overall, during August, Ford, Lincoln and Mercury vehicle sales
totaled 151,021, down 26%.  The decline primarily reflects lower
demand for SUVs (down 53%) and trucks (down 39%) and lower sales
to fleet customers (down 31%).

"We expect the second half of 2008 will be more challenging than
the first half, as weak economic conditions and the consumer
credit crunch continues," Mr. Farley said.

                    North American Production

Ford now plans to produce 890,000 vehicles in the second half of
2008 (420,000 vehicles in the third quarter and 470,000 vehicles
in the fourth quarter).

The second-half plan is 50,000 vehicles lower than the previous
plan (20,000 vehicles in the third quarter and 30,000 vehicles in
the fourth quarter).  The reduction primarily reflects lower sales
to daily rental companies, lower production associated with the
transfer of the Ford Expedition and Lincoln Navigator from
Michigan Truck Plant to Kentucky Truck Plant, and a downward
revision to the company's U.S. industry sales forecast (to the low
end of the previously provided range of 14.0 to 14.5 million).

                      About Ford Motor Co.

Headquartered in Dearborn, Michigan, Ford Motor Co. (NYSE: F) --
http://www.ford.com/-- manufactures or distributes automobiles in
200 markets across six continents.  With about 260,000 employees
and about 100 plants worldwide, the company's core and affiliated
automotive brands include Ford, Jaguar, Land Rover, Lincoln,
Mercury, Volvo, Aston Martin, and Mazda.  The company provides
financial services through Ford Motor Credit Company.

The company has operations in Japan in the Asia Pacific region. In
Europe, the company maintains a presence in Sweden, and the United
Kingdom.  The company also distributes its brands in various
Latin-American regions, including Argentina and Brazil.

                          *     *     *

As reported in the Troubled Company Reporter on Aug. 5, 2008,
Fitch Ratings has downgraded the issuer default rating of Ford
Motor Company and Ford Motor Credit Company LLC to 'B-' from 'B'.  
The Rating Outlook remains Negative.  The downgrade reflects: the
further deterioration in Ford's U.S. sales as a result of economic
conditions, an adverse product mix and the most recent jump in gas
prices; portfolio deterioration at Ford Credit and heightened
concern regarding economic access to capital to support financing
requirements; and escalating commodity costs that will remain a
significant offset to cost reduction efforts.


FRED LEIGHTON: Court Approves Retention of Three Firms
------------------------------------------------------
The United States Bankruptcy Court for the Southern District of
New York has authorized Fred Leighton Holding, Inc. and its
ddebtor-affiliates to employ these firms in the pendency of their
chapter 11 cases:

A. Phillips Nizer LLP -- Special Litigation Counsel

Phillips Nizer will represent the Debtors in connection with
disputes surrounding possible claims by Merrill Lynch Mortgage
Capital Inc. against one or more of the Debtors and vice versa.  
The firm will provide advice to the Debtors with respect to
matters related to the agreements between the Debtors and Merrill
Lynch, including Merrill Lynch's right to recover fees and costs
during the pendency of the bankruptcy cases.

B. Benjamin Zucker -- Non-Exclusive Sales Agent

Calypso Mines LLC, a debtor-affiliate, maintains as a separate
category of inventory called "special collection" consisting of
iconic jewels created over the past several hundred yaers and
exhibited in museums throughout the world.  The value of the
special collection inventory is central to the Debtors'
reorganization.

In light of the unique characteristics of the special collection
inventory, the Debtors submit that it is in the best interest of
all parties that Mr. Zucker be retained as sales agent.

Mr. Zucker will be paid a commission of 8% of the gross sales
price of each item sold.

C. Eisner LLP -- Accountant

David Ringer, CPA, a partner of Eisner, will be primarily
responsible for handling the Debtors' accounting needs.  He will
assist the Debtors in the preparation of schedules, preparation of
monthly operating reports, and other financial reports.

                       About Fred Leighton

Fred Leighton Holding, Inc. -- http://www.fredleighton.com/-- is  
a New York-based jewelry retailer owned by Ralph O. Emerian.  Fred
Leighton has decked countless red-carpet-dwellers in diamonds,
including Sarah Jessica Parker, Nicole Kidman, and Catherine Zeta-
Jones.  It specializes in vintage jewelry from the 18th and 20th
centuries, including antique cushion-cut diamonds and antique and
estate brooches.  It also produces Fred Leighton signature
collection that combines past aura and the present materials and
craftmanship.

The Debtors filed voluntary petitions for relief under Chapter 11
of the Bankruptcy Code on April 15, 2008 (Bankr. S.D.N.Y., Case
No. 08-11363).  Joshua Joseph Angel, Esq., and Frederick E.
Schmidt, Esq., at Herrick, Feinstein LLP, in New York, represent
the Debtors.  An Official Committee of Unsecured Creditors has
been appointed in these cases.  The Committee's counsels are
Michael Z. Brownstein, Esq., and Rocco A. Cavaliere, Esq., at
Blank Rome LLP.  No trustee or examiner has been appointed in the
cases.  The Debtors listed total assets of $128,551,467 and total
liabilities of $134,814,367 in their schedules.


FREMONT GENERAL: CEO and President Tender Resignations
------------------------------------------------------
Fremont General Corporation said that its chief executive officer
Stephen H. Gordon and president David S. DePillo are resigning
from the company, effective Sept. 30, 2008.

The company has named Richard A. Sanchez as interim chief
executive officer, effective Oct. 1, 2008.  He is presently
serving as the company's executive vice president and chief
administrative officer and will remain on the company's board.

Messrs. Gordon and DePillo will remain with the company as non-
executive chairman and vice-Chairman of the boards through a
transition period.

Mr. Sanchez's annual base salary will be increase to $600,000 from
$500,000.  Mr. Gordon will receive any unpaid portion of his
accrued salary and any unreimbursed reasonable expenses incurred
through the effective date of his termination of service.

                      About Fremont General

Fremont General Corporation (OTC: FMNTQ) --
http://www.fremontgeneral.com/--  is a financial services holding
company with $8.8 billion in total assets, at September 30, 2007.
The company is engaged in deposit gathering through a retail
branch network located in the coastal and Central Valley regions
of Southern California through Fremont Investment & Loan.  Fremont
Investment & Loan funds its operations primarily through deposit
accounts sourced through its 22 retail banking branches which are
insured up to the maximum legal limit by the FDIC.

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

Fremont General filed for Chapter 11 protection on June 18, 2008,
(Bankr. C.D. Calif. Case No. 08-13421).  Robert W. Jones, Esq.,
and J. Maxwell Tucker, Esq., at Patton Boggs LLP, represent the
Debtor in its restructuring efforts.  The Debtor selected
Kurtzman Carson Consultants LLC as its claims agent.

Peter C. Anderson, the U.S. Trustee for Region 16, has appointed
five creditors to serve on an Official Committee of Unsecured
Creditors in the case.

In its schedules, Fremont General reported $362,227,537 in total
assets and $326,529,372 in total debts.  When the Debtor filed for
protection from its creditors, it listed total assets of
$643,197,000 and total debts of $320,630,000.


GENERAL MOTORS: Flint Okays Tax Incentives for Proposed Plant  
-------------------------------------------------------------
Detroit Free Press reports that Flint City Council has approved
tax incentives to help persuade General Motors Corp. to build a
$350 million engine plant.  The facility will build the gas engine
for the Chevrolet Volt range-extended electric car and the
Chevrolet Cruze compact car.  GM expects to operate it by 2010 in
line with a plan to begin selling the Cruze and the Volt by that
time.  The overall plan is dependent on GM and its partners
figuring out the battery technology, according to the report.

                    About General Motors

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

At March 31, 2008, GM's balance sheet showed total assets of
$145,741,000,000 and total debts of $186,784,000,000, resulting in
a stockholders' deficit of $41,043,000,000.  Deficit, at Dec. 31,
2007, and March 31, 2007, was $37,094,000,000 and $4,558,000,000,
respectively.

General Motors Latin America, Africa and Middle East, with
headquarters in Miramar, Florida, is one of GM's four regional
business units.  GM LAAM employs approximately 37,000 people in
18 countries and has manufacturing facilities in Argentina,
Brazil, Colombia, Ecuador, Egypt, Kenya, South Africa and
Venezuela.  GM LAAM markets vehicles under the Buick,
Cadillac, Chevrolet, GMC, Hummer, Isuzu, Opel, Saab and
Suzuki brands.


GENERAL MOTORS: August Total Vehicle Sales Down 20% to 308,817
--------------------------------------------------------------
General Motors Corp. dealers in the United States delivered
308,817 vehicles in August, making it GM's best monthly total,
retail and fleet sales performance so far in 2008.  The strong
showing was spurred by GM's Employee Discount for Everyone sale in
celebration of GM's Centennial later this month.  In response to
ongoing customer and dealer demand, the sale is being extended
through Sept. 30, 2008 and a number of 2009 models are being added
due to dwindling 2008 inventories.

Compared with an exceptionally strong retail and fleet month last
year, August total sales were down 20%.  However, when compared
with July, 2008, total sales were up 31%, retail sales were up 32%
and fleet sales were up 29%.  Last August's sales performance was
influenced by significantly lower fuel prices and a 0% APR for 60
months offer on pickups.

Notably in August, Chevrolet Silverado, Avalanche and GMC Sierra
had their strongest total sales month since last August, with more
than 80,000 vehicles sold, as GM full-size pickups continue to
build market share calendar-year-to-date.  Silverado sales were up
69%, Avalanche was up 59% and Sierra sales increased 75% compared
with July, 2008.

Chevrolet Tahoe, Suburban and GMC Yukon full-size utilities had
their best performance of the year with total sales up 33%
compared with July with more than 22,000 vehicles sold.  Overall,
GM August truck sales (excluding crossovers) declined 25.6%
compared with a year ago.

"Our award-winning lineup of new products, combined with the GM
Employee Discount for Everyone sale that started August 20th,
helped drive additional showroom traffic and our dealers are
giving us some very enthusiastic feedback.  We had our best sales
month so far in 2008.  We're announcing the extension of the sale
through September 30, and we've added 19 additional 2009 models to
the eligible list of vehicles because our 2008 stock on dealer
lots is rapidly disappearing," Mark LaNeve, vice president, GM
North America Vehicle Sales, Service and Marketing, said.

"With the recent moderation in fuel prices, we're seeing some
relaxation of pent-up demand in pickups and utilities.  Our August
sales of these segment-leading trucks and utilities has been the
best in nearly a year and August marked the fourth consecutive
month that truck sales as a%age of GM and industry sales
increased. We also saw double-digit retail increases in our
crossovers compared with July," Mr. LaNeve added.  "We saw great
car retail performance in our launch products, including the
Chevrolet Malibu, Cadillac CTS, Pontiac Vibe and G8, and Saturn
Astra, and continued strong retail demand for our fuel efficient
Chevrolet Aveo and HHR."

Chevrolet retail car sales were up 18%, Pontiac retail car sales
increased 11% and Cadillac retail car sales were up 10% compared
with last August.

Cadillac CTS dominated the mid-car luxury category with retail
sales increasing 87% compared with the same month a year ago.

Saturn Astra monthly sales of more than 1,900 vehicles were the
best to date, and show a 28% increase compared with July 2008
(Astra was not available last August).

GM's popular midsized crossovers -- Buick Enclave, GMC Acadia and
Saturn Outlook -- together accounted for more than 14,600 vehicle
sales in the month, with a retail sales increase of 29% compared
with a year ago.

GM hybrid vehicles continue to gain in popularity in the
marketplace with 530 hybrid Chevrolet Tahoe, 267 GMC Yukon and 1
Cadillac Escalade 2-mode SUVs delivered.  There were 388 Chevrolet
Malibu, 26 Saturn Aura and 417 Vue hybrids sold in August. For the
month, a total of 1,629 hybrid vehicles were delivered, with 7,096
hybrids sold so far this year.

"Customers are responding to our six hybrid models -- vehicles
that provide industry-leading value, great fuel economy and the
best warranty coverage of any full-line automaker," Mr. LaNeve
added.  "We're working hard to change perceptions and gain
awareness of GM as the leader in advanced propulsion technology
and fuel efficiency."

GM has aggressively managed inventories to low levels.  In August,
only about 736,000 vehicles were in stock -- the lowest August
level since 1998 -- down about 209,000 vehicles (22%) compared
with last August.  There were about 256,000 cars and 480,000
trucks (including crossovers) in inventory at the end of August.

                       Certified Used Vehicles

August 2008 sales for all certified GM brands, including GM
Certified Used Vehicles, Cadillac Certified Pre-Owned Vehicles,
Saturn Certified Pre-Owned Vehicles, Saab Certified Pre-Owned
Vehicles, and HUMMER Certified Pre-Owned Vehicles, were 41,238
vehicles, down 8% from August 2007.  Year-to-date sales are
339,375 vehicles, down 5% from the same period last year.

GM Certified Used Vehicles, the industry's top-selling certified
brand, posted August sales of 35,168 vehicles, down 12% from a
strong August 2007 sales performance. Saturn Certified Pre-Owned
Vehicles sold 1,005 vehicles, down nearly 6%.  Cadillac Certified
Pre-Owned Vehicles sold 4,023 vehicles, up 27%.  Saab Certified
Pre-Owned Vehicles sold 791 vehicles, up 32%, and HUMMER Certified
Pre-Owned Vehicles sold 251 vehicles, up 130%.

"The Cadillac, Saab and HUMMER programs posted robust sales
increases in August, while GM Certified Used Vehicles continues to
lead the certified pre-owned segment in sales," Mr. LaNeve.  "The
launch this month of a new 12-month/12,000-mile bumper-to-bumper
warranty on all Saturn Certified Pre-Owned and GM Certified Used
Vehicles, effective September 13, will provide shoppers a range of
peace-of-mind assurances as strong as those provided by any
certified program in America."

            GM North America August 2008 Production

In August, GM North America produced 341,000 vehicles (158,000
cars and 183,000 trucks).  This is down 96,000 vehicles or 22%
compared with August 2007 when the region produced 437,000
vehicles (152,000 cars and 285,000 trucks).  (Production totals
include joint venture production of 18,000 vehicles in August 2008
and 21,000 vehicles in August 2007.)

The GM North America third-quarter production forecast is at
920,000 vehicles (443,000 cars and 477,000 trucks) which is down
about 10% compared with a year ago, due to production adjustments
in response to market changes that will reduce the number of
trucks produced by about 176,000 and increase the number of cars
by about 76,000.  GM North America built 1.020 million vehicles
(367,000 cars and 653,000 trucks) in the third-quarter of 2007.

The initial GM North America fourth-quarter production forecast is
875,000 vehicles (436,000 cars and 439,000 trucks) which is down
about 16% compared with a year ago.  GM North America built 1.042
million vehicles (358,000 cars and 684,000 trucks) in the fourth-
quarter of 2007.

                    About General Motors

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

General Motors Latin America, Africa and Middle East, with
headquarters in Miramar, Florida, is one of GM's four regional
business units.  GM LAAM employs approximately 37,000 people in
18 countries and has manufacturing facilities in Argentina,
Brazil, Colombia, Ecuador, Egypt, Kenya, South Africa and
Venezuela.  GM LAAM markets vehicles under the Buick,
Cadillac, Chevrolet, GMC, Hummer, Isuzu, Opel, Saab and
Suzuki brands.

At March 31, 2008, GM's balance sheet showed total assets of
$145,741,000,000 and total debts of $186,784,000,000, resulting in
a stockholders' deficit of $41,043,000,000.  Deficit, at Dec. 31,
2007, and March 31, 2007, was $37,094,000,000 and $4,558,000,000,
respectively.


GRANDLUXE RAIL: Financial Woes Blamed for Shutdown
--------------------------------------------------
GrandLuxe Rail Journeys Inc., fka American Orient Express, halted
operations last week, citing financial difficulties, various
sources report.

According to the Los Angeles Times, the company said in a notice
it ceased business after it returned several train to Tacoma,
Washington, on Aug. 28, 2008.  The notice indicated that the
company was "financially unable", the report says.

The company said that it is unclear whether customers could get
their money back, the report notes.

Amtrack was immediately informed on Tuesday about the shutdown,
the Los Angeles Times say.  Amtrack provides locomotive and
conductors for the company, the report says.

Headquartered in Evergreen, Colorado, GrandLuxe Rail Journeys Inc.
-- http://www.americanorientexpress.com/-- operates luxury
private train.


HANDLEMAN CO: Grant Thornton Expresses Going Concern Doubt
----------------------------------------------------------
Grant Thornton LLP raised substantial doubt about the ability of
Handleman Company to continue as a going concern after auditing
the company's financial statements for the year ended May 3, 2008.  
The auditor reported that the company has incurred a net loss and
has been unable to obtain additional financing to satisfy its
operating and capital requirements through May 2, 2009.

                       Management Statement

The company has been unable to obtain additional financing to
satisfy its operating and capital requirements through May 2,
2009.  In addition, in April 2008, the company's board of
directors approved exiting the music business in North America.  
The company announced this decision in the first quarter of fiscal
2009.  It also began marketing its Crave Entertainment Group,
Inc., subsidiary, selling certain assets in the United Kingdom, as
well as seeking other strategic alternatives for its remaining
entities.

Also, management believes that cash provided from operations and
the sale of assets could provide sufficient liquidity to fund its
day-to-day operations provided that the company is able to sell
its remaining assets within a reasonable period of time.  

If the company is unable to sell its assets or if it receives
substantially less than anticipated, the company's liquidity would
be dependent upon further amendments to its credit agreements or
securing alternative funding.  If these actions are unsuccessful,
then the company's ability to continue as a going concern would be
in doubt.

While the company is reasonably confident that it will be able to
successfully sell its remaining assets, it cannot make any
assurances that there will be a reasonable demand for these
assets.  With the decline in the music and video industries,
Handleman faces risks that further declines of sales in its
operating markets will hinder its ability to successfully sell its
assets.

Handleman anticipates that sales of its remaining assets will be
made on terms that are approved by the board of directors and may
be conducted by competitive bidding, public sales or privately
negotiated sales.  

The prices at which the company will be able to sell these assets
will depend largely on factors beyond the company's control,
including, without limitation, the condition of financial markets,
the availability of financing to prospective purchasers of the
assets, public market perceptions and limitations on
transferability of certain assets.  

Because some of its remaining assets, particularly intellectual
property assets, may decline in value over time, the consummation
of the sale of these assets in time to generate meaningful value
is critical.  

In addition, the company may not obtain as high a price for its
illiquid assets as might have been obtained were the company not
seeking strategic alternatives for its various business
operations.

                    Results of Operation

The company posted a net loss of $96,785,000 on total revenues of
$494,570,000 for the year ended May 3, 2008, as compared with a
net loss of $53,428,000 on total revenues of $558,363,000 in the
prior year.

Consolidated revenues from continuing operations for fiscal 2008
were $494,600,000, compared with $558,400,000 for fiscal 2007.  
Revenues in the category management and distribution operations
segment decreased to $219,500,000 in this fiscal year from
$322,700,000 during the same period last year.  This decrease was
primarily due to the discontinuance of the music supply
arrangement with customer ASDA, a subsidiary of Wal-Mart Stores,
Inc., in the UK in early fiscal 2008 resulting in a decrease in
revenues of $210,700,000.  This decrease was offset in part, by
revenues from the fee-for-services model, which had an increase of
$49,700,000, chiefly related to a new arrangement to distribute
and service entertainment product for Tesco Stores Limited in the
UK, which began in the first quarter of fiscal 2008.  

The distribution and servicing of the greeting cards business in
the UK also had an increase in revenues of $32,100,000 during
fiscal 2008 predominantly due to a full year of revenues in fiscal
2008 (the greeting cards business began in the latter part of
fiscal 2007).  The remainder of the offset was primarily due to an
increase in revenues of $15,2000,000 in the UK from non-ASDA
category management customers and a $7,700,000 reduction in future
returns reserve requirements in the UK.

Revenues in the video game operations segment were $259,600,000 in
fiscal 2008, compared with $219,700,000 in fiscal 2007.  This
increase was primarily due to:

   (i) increased exclusive distribution revenues of $18,400,000
       driven by the initiative in the current fiscal year to
       secure additional exclusive distribution arrangements
       related to video game software products and the success
       of those titles,

  (ii) a $15,100,000 improvement in shipments of hardware
       bundles that combine a video game console with software
       titles and game accessories due to the popularity of the
       Wii, PS2 and PS3 video game hardware platforms, and

(iii) increased revenues related to internally developed video
       game software of $8,100,000.

Debt, current portion at May 3, 2008, totaled $63,700,000,
compared with $106,900,000 at April 28, 2007.  The cash generated
from the discontinuance of the ASDA music and video business,
which was used to reduce borrowings, as well as its efforts to
minimize overall working capital requirements, mainly drove this
reduction.

Accounts payable was $31,000,000 at May 3, 2008, compared with
$159,400,000 at April 28, 2007.  This decrease was primarily due
to the reclassification of accounts payable to "Liabilities held
for sale" in the amount of $56,800,000 resulting from its decision
to exit the music business in North America; a $28,100,000
decrease in the UK accounts payable balance related to the
discontinuance of the ASDA music supply arrangement; a decrease in
the Crave accounts payable balance of $16,200,000 due to cash in
advance payment terms for a greater portion of its inventory
purchases; a reduction in U.S. accounts payable of $12,800,000
primarily driven by its efforts to minimize inventory levels and a
reduction in corporate accounts payable of $7,600,000 primarily
driven by lower bank fees.

Accrued and other liabilities were $23,500,000 at May 3, 2008,
compared with $31,200,000 at April 28, 2007.  This decrease was
primarily due to the reclassification of accrued and other
liabilities to "Liabilities held for sale" in the amount of
$5,500,000 resulting from its decision to exit the music business
in North America, lower payroll related accruals of $3,800,000 and
lower accrued legal expense of $1,100,000.  The decrease was
partially offset by higher income tax payables of $2,100,000.

Liabilities held for sale totaled $62,300,000 at May3, 2008, while
no balance existed at April 28, 2007.  This increase was due to
its decision to exit the music business in North America. In
accordance with accounting guidance, the U.S. and Canadian
liabilities were reclassified as held for sale as of May 3, 2008.

For fiscal 2008, the company had a net loss from continuing
operations of $126,600,000 compared with a net loss of
$100,000,000 for fiscal 2007.

                 Liquidity and Capital Resources

On April 30, 2007, Handleman Company and certain of its
subsidiaries entered into two, five-year credit agreements with
Silver Point Finance, LLC, and General Electric Capital
Corporation that constituted a $250,000,000 multi-tranche credit
facility.  Company borrowings under the agreements are limited by
the collateral value of certain assets less reserves with a
maximum of $223,306,000 as of May 3, 2008.  Absent this multi-year
credit facility, the company would have violated its debt
covenants under its previous credit agreements.

Also, on April 30, 2007, Handleman Company terminated the amended
and restated credit agreements dated Nov. 22, 2005, with its
lenders and repaid all amounts outstanding under those agreements.  
The collateral value of certain assets less reserves as of May 3,
2008, was $76,318,000.  A borrowing base certificate, which
details the value of collateral assets, is required daily from the
company to support all debt outstanding.

Subsequent to May 3, 2008, the company entered into a Sixth,
Seventh, Eighth, Ninth and Tenth Amendment to its credit
agreements.  The Tenth Amendment, among other provisions, waived
an event of default that existed at May 3, 2008, that related to
the amount of capital expenditures, license advances, exclusive
distribution advances and software development costs allowed
during the period of Jan. 1, 2008, to May 31, 2008.  

The company intends to sell its significant assets, which include
Crave, Handleman Canada, REPS and Handleman UK.  If
the company is not able to complete those sales transactions by
Oct. 31, 2008, then the company projects that it will not comply
with a Tenth Amendment covenant that requires a $70,000,000
minimum asset coverage on and after Oct. 31, 2008.  The company
would seek to amend its credit agreement to prevent an event of
default, but cannot make any assurances that its lender would
agree to an amendment.  

The company had borrowings of $63,700,000 and $106,900,000
outstanding as of May 3, 2008, and April 28, 2007, respectively,
both of which were classified as current liabilities at each of
these balance sheet dates.

As of May 3, 2008, the company had excess availability under its
credit agreements to borrow an additional $12,600,000.  After the
last holiday season, as anticipated, the company experienced a
significant reduction in its collateral assets, primarily due to
its collection of accounts receivable balances and an overall
reduction in inventory levels, as well as a significant increase
in its cash position.  This deduction in working capital led to
its request for a fifth amendment.  

This amendment also required the company to pre-pay $20,000,000 of
its Term A Loan debt on March 4, 2008.  The amount was based on
its cash balances as of that date.  Subsequent prepayments of term
debt in the amount of $9,200,000 were also made between March 5,
2008, and May 3, 2008.  

A prepayment premium associated with these early debt repayments
in the amount of $2,500,000 was incurred and was recorded in the
fourth quarter of fiscal 2008 in discontinued operations in the
company's Consolidated Statements of Operations.

On Feb. 7, 2006, the company entered into an interest rate swap
agreement for a notional amount of $75,000,000 in order to reduce
variable interest rate exposure.  On Feb. 16, 2007, the company
sold the interest rate swap agreement and recorded a related gain
of $101,000 in the fourth quarter of fiscal 2007 that was
amortized through April 28, 2007, the expected remaining term of
its borrowings under the 2007 Credit Agreement.

For the fiscal year ended April 28, 2007, a total of $0.24 per
share or $4,800,000 in cash dividends was paid to shareholders.  
The company did not pay cash dividends during fiscal 2008.

Working capital at May 3, 2008, was $62,500,000, compared with
$90,300,000 at April 28, 2007.

Net cash provided from operating activities included in the
Consolidated Statements of Cash Flows increased to $56,300,000 for
fiscal 2008 from $22,600,000 for fiscal 2007.  The increase in
cash flows from operating activities was primarily related to
year-over-year reductions in accounts receivable, inventory and
other operating assets and liabilities of $49,900,000, $37,800,000
and $18,300,000 respectively; these increases were partially
offset by a year-over-year reduction in accounts payable of
$75,700,000.

Net cash used by investing activities was $22,100,000 for fiscal
2008, compared with $38,300,000 for fiscal 2007.  The decrease in
cash flows used by investing activities was mainly the result of
reduced spending on property and equipment of $20,100,000 and
other cash investments of $2,200,000; this reduction was partially
offset by increased spending by Crave on license advances and
acquired rights of $7,400,000.  The company also received proceeds
in fiscal 2008 related to the sale of investments of $1,200,000.

Net cash used by financing activities was $50,800,000 for fiscal
2008, compared with net cash provided from financing activities of
$23,300,000 for fiscal 2007.  This decease in cash flows from
financing activities was predominately due to an increase of net
debt repayments of $63,000,000, a decrease of $8,200,000 in checks
issued in excess of cash balances, which were classified as a
financing activity in the prior fiscal year; under its new credit
agreements, bank overdrafts are not honored by the bank if
sufficient funds do not exist to cover payment of the overdrafts;
therefore, checks issued in excess of cash balances, when in
existence, are classified as an operating activity in fiscal 2008.  
Checks issued in excess of cash balances were $3,400,000 at May 3,
2008.  Additionally, the decrease in cash flows from financing
activities was due to an increase of $7,800,000 in financing
related fees.  These net uses of cash were offset, in part, by a
year over year decline in cash dividends paid of $4,800,000.

                           Balance Sheet

At May 3, 2008, the company's balance sheet showed $328,704,000 in
total assets, $187,031,000 in total liabilities, and $141,673,000
in total stockholders' equity.  

The company's consolidated balance sheet at May 3, 2008, showed
$243,090,000 in total current assets available to pay $180,575,000
in total current liabilities.

A full-text copy of the company's 2008 annual report is available
for free at http://ResearchArchives.com/t/s?319d

                      About Handleman Company

Handleman Company (Other OTC: HDLM) -- http://www.handleman.com/
-- is a category manager and distributor of prerecorded music and
console video game hardware, software and accessories to leading
retailers in the United States, United Kingdom, and Canada.  As a
category manager, the company manages a broad assortment of titles
to optimize sales and inventory productivity in retail stores.
Services offered include product selection, direct-to-store
shipments, marketing and in-store merchandising.


HENRY JOHNSON: Case Summary & Nine Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Henry Lloyd Johnson, III
         aka Buddy Johnson
        416 Freshmeadow Street
        Norfolk, VA 23518

Bankruptcy Case No.: 08-72955

Chapter 11 Petition Date: September 3, 2008

Court: Eastern District of Virginia (Norfolk)

Debtor's Counsel: Tom C. Smith, Esq.
                  (bankruptcy@tomcsmith.com)
                  The Offices of Tom C. Smith
                  1600 Virginia Beach Boulevard
                  Virginia Beach, VA 23454-4631
                  Tel: (757) 428-3481
                  Fax: (757) 491-6174

Total Assets: $1,249,766

Total Debts: $1,240,963

A list of the Debtor's largest unsecured creditors is available
for free at:

           http://bankrupt.com/misc/vaeb08-72955.pdf


HERITAGE FARMS: Case Summary & Three Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Heritage Farms, LLC
        P.O. Box 8471
        Cranston, RI 02920

Bankruptcy Case No.: 08-12723

Chapter 11 Petition Date: September 2, 2008

Court: District of Rhode Island (Providence)

Judge: Arthur N. Votolato

Debtor's Counsel: Russell D. Raskin, Esq.
                   (mail@raskinberman.com)
                  Raskin & Berman  
                  116 East Manning Street
                  Providence, RI 02906
                  Tel: (401) 421-1363

Estimated Assets: $1 million to $10 million

Estimated Debts: $1 million to $10 million

A list of the Debtor's largest unsecured creditors is available
for free at http://bankrupt.com/misc/rid08-12723.pdf


HIGH GRADE STRUCTURED: Moody's Junks Ratings on Four Senior Notes
-----------------------------------------------------------------
Moody's Investors Service has downgraded the ratings of five
classes of notes issued by High Grade Structured Credit CDO
2007-1, and left on review for possible further downgrade the
rating of one of these classes of notes as:

Class Description: U.S. $27,900,000 Class X Senior Secured Notes
Due 2017

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

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

Class Description: Up to U.S. $3,240,000,000 Class A-1B Notes

   -- Prior Rating: Caa3

   -- Current Rating: Ca

Class Description: U.S. $200,000,000 Class A-2 Senior Secured
Floating Rate Notes Due 2052

   -- Prior Rating: Ca

   -- Current Rating: C

Class Description: U.S. $300,000,000 Class A-3 Senior Secured
Floating Rate Notes Due 2052

   -- Prior Rating: Ca

   -- Current Rating: C

Class Description: U.S. $115,000,000 Class B Senior Secured
Floating Rate Notes Due 2052

   -- Prior Rating: Ca

   -- Current Rating: C

The transaction experienced, as reported by the Trustee on
February 27, 2008, an event of default described as a Senior
Overcollateralization Default in Section 5.1(i) of the Indenture
dated May 24, 2007. This event of default is still continuing.
High Grade Structured Credit CDO 2007-1 is a collateralized debt
obligation backed primarily by a portfolio of Structured Finance
securities.

As provided in Article V of the Indenture during the occurrence
and continuance of an Event of Default, certain parties to the
transaction may be entitled to direct the Trustee to take
particular actions with respect to the Collateral Debt Securities
and the Notes. In this regard the Trustee reports that a majority
of the Controlling Class directed the Trustee to sell and
liquidate the Collateral in accordance with relevant provisions of
the transaction documents.

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


HOME EQUITY: Moody's Junks Ratings on Five 2006-2 Note Classes
--------------------------------------------------------------
Moody's Investors Service has downgraded 6 notes issued by Home
Equity Mortgage Trust 2006-2.  The transaction is backed by second
lien loans. The notes were downgraded because the bonds' credit
enhancement levels, including excess spread and subordination were
low compared to the current projected loss numbers at the previous
rating levels.

The actions take into account the continued and worsening
performance of transactions backed by closed-end-second (CES) and
home equity line of credit (HELOC) collateral.  Substantial pool
losses of over the last few months have eroded credit enhancement
available to the mezzanine and senior notes.  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: Home Equity Mortgage Trust 2006-2

   -- Cl. 1A-1, Downgraded to Ba3 from Aa3

   -- Cl. 1A-2, Downgraded to Ca from A3

   -- Cl. 1A-3, Downgraded to C from Ba1

   -- Cl. 1M-1, Downgraded to C from Caa1

   -- Cl. 1M-2, Downgraded to C from Caa3

   -- Cl. 1M-3, Downgraded to C from Ca


IDA GALATI: Voluntary Chapter 11 Case Summary
---------------------------------------------
Debtor: Ida Galati
        1640 Eleanor Drive
        San Mateo, CA 94402

Bankruptcy Case No.: 08-31637

Chapter 11 Petition Date: Sept. 2, 2008

Court: Northern District of California (San Francisco)

Debtor's Counsel: John G. Downing, Esq.
                  Downing Law Firm
                  109 Geary Street. 4th Floor
                  San Francisco, CA 94108
                  Email: jgdowning@sbcglobal.net

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

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

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


IDLEAIRE INC: Investment Firms Complete $17.5MM IdleAire Purchase
-----------------------------------------------------------------
IdleAire Inc. disclosed Tuesday that six investment management
companies completed their $17.5 million purchase of IdleAire Inc.
and now own essentially all of the company's assets, the
Knoxvillebiz.com reports.

Although the company is expected to remain headquartered in
Knoxville, and to retain current IdleAire employees, there will be
changes in senior management, according to the announcement.

The new owners include advisory clients of Airlie Group, Kenmont
Investments Management, SV Special Situations Fund, Whitebox
Advisors; Wayzata Investment Partners and Wilfrid Aubrey, LLC.

"It's a new company with new owners who are very optimistic about
IdleAire's prospects," John Calabrese, a partner with the
turnaround specialist firm CRG Partners Group, stated in the news
release.

The new company will retain both the "IdleAire" brand and the
Advanced Travel Center Electrification designation.

"The immediate priority of the new owners of IdleAire is to create
a world-class management team and identification of this team is
underway," Calabrese stated.

"Secondly, we have to maximize the resources and infrastructure
already in place.  Over the next few weeks and months, CRG
Partners will work with the new owners and IdleAire employees to
lay out a comprehensive business plan to better serve fleets,
drivers and travel centers, all of whom benefit from the service.
We have already discussed numerous prospective areas of growth,
but the first priority is to create a business that is
fundamentally strong.

"Once the new CEO is on board, which is on track to occur in
October, we will be able to be more specific.  Right now, we are
focused on continuing to serve our fleet and driver customers
across the nation.”

As disclosed in the Troubled Company Reporter on July 17, 2008,
the Hon. Kevin Gross of the U.S. Bankruptcy Court for the District
of Delaware approved the sale of IdleAire Technologies Corp. for
about $26 million.   

                   About IdleAire Technologies

Headquartered in Knoxville, Tennessee, IdleAire Technologies Corp.
-- http://www.idleaire.com/-- is a privately held corporation         
founded in June 2000 and has not been profitable since inception.   
It manufactures and services an advanced travel center
electrification system providing heating, ventilation & air
conditioning, Internet and other services to truck drivers parked
at rest stops.  The company delivers its services to long-haul
drivers through its patented Advanced Travel Center
Electrification(R) system, or ATE system, comprised of an in-cab
service module connected to an external heating, ventilation and
air conditioning unit, or HVAC unit, mounted on a truss structure
above parking spaces.  IdleAire has 131 locations in 34 states and
employs about 1,200 people.

The company filed chapter 11 petition on May 12, 2008 (Bankr. D.
Del. Case No. 08-10960).  Judge Kevin Gross presides over the
case.  Elihu Ezekiel Allinson, III, Esq., William A. Hazeltine,
Esq., and William David Sullivan, Esq., at Sullivan Hazeltine
Allinson, LLC represent the Debtor in its restructuring efforts.  
John Monaghan, Esq., at Holland & Knight LLP is co-counsel to the
Debtor.  The Debtor selected Kurtzman Carson Consultants LLC as
claim, noticing and balloting agent.  The U.S. Trustee for Region
3 appointed three creditors as members of the Official Committee
of Unsecured Creditors.  Saul Ewing LLP represents the Creditors'
Committee.

The Troubled Company Reporter disclosed on June 30, 2008 that the
Debtor's summary of schedules showed total assets of $152,398,370
and total debts of $373,220,369.


INTERMET CORP: Obtains Authority to Pay Various Prepetition Claims
------------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware authorized
Intermet Corp. and its debtor-affiliates to address various
obligations.

A. Prepetition Contractor Claims

The Court authorized the Debtors to pay certain prepetition claims
of contractors in satisfaction of liens.  The Debtors estimate
that the aggregate amount to be paid for contractor claims will be
no more than $300,000.  The Court also authorized all financial
institutions to receive and honor checks drawn on the Debtors'
accounts to pay the contractor claims.

B. Workers' Insurance

The Debtors obtained authority to maintain and continue their
workers' compensation insurance program and policies.  The
provision of workers' compensation benefits to the Debtors'
employees is mandated by law in each of the states in which the
Debtors operate.

The Debtors currently maintain their workers' compensation program
with Ace American Insurance Company.  The program is renewed on
December 22 of each year.  Annual insurance premiums for all of
the insurance policies aggregate about $2,689,531.  No prepetiton
amounts are owed for insurance premiums, the Debtors said.

C. Prepetition Trade Vendor Claims

The Debtors were authorized to pay the prepetition claims of
certain vendors that are essential to the uninterrupted
functioning of the Debtors' various manufacturing and business
operations.  The automotive component manufacturing industry
depends on reliable suppliers.  If essential vendors discontinue
their supply of goods and services as a result of the Debtors'
bankruptcy cases, the Debtors' manufacturing process would be
compromised and deliveries to customers would be halted.

The Debtors are authorized to pay essential vendor claims up to
$5,000,000.

D. Prepetition Shipper Claims

The Debtors were authorized to pay certain prepetition claims of
shippers and warehousemen.  The automotive industry depends on
reliable shipping.  Under some non-bankruptcy laws, a shipper or
warehouseman may have a lien on the goods in its possession, which
secures the charges or expenses incurred in connection with the
transportation or storage of the goods.  The Debtors do not expect
the payments to exceed $400,000.

                        About Intermet Corp.

Based in Fort Worth, Texas, Intermet Corp. designs and
manufactures machine precision iron and aluminum castings for the
automotive and industrial markets.  The company and its debtor-
affiliates filed for chapter 11 protection on Aug. 12, 2008 (D.
Del. Case Nos. 08-11859 to 08-11866 and 08-11868 to 08-11878).  
Dennis F. Dunne, Esq., Matthew S. Barr, Esq., and Michael E.
Comerford, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New
York, serve as the Debtors' lead counsel.  James E. O'Neill, Esq.,
Laura Davis Jones, Esq. and Timothy P. Cairns, Esq., at Pachulski
Stang Ziehl & Jones LLP, in Wilmington, Delaware, serve as the
Debtors' local counsel.  When the Debtors filed for protection
from their creditors, they listed assets of between $50 million
and $100 million and total debts of between $100 million and
$500 million.


INTERMET CORP: May Employ Kurtzman Carson as Notice Agent
---------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware authorized
Intermet Corp. and its debtor-affiliates to employ Kurtzman Carson
Consultants LLC as their notice, claims, and balloting agent.

The Debtors related that the retention of the firm is necessary to
alleviate the potential burden on the Court and the Bankruptcy
Clerk's Office.  The Debtors have over 2,500 potential creditors
and other parties-in-interest, many of whom are expected to file
proofs of claim.

                        About Intermet Corp.

Based in Fort Worth, Texas, Intermet Corp. designs and
manufactures machine precision iron and aluminum castings for the
automotive and industrial markets.  The company and its debtor-
affiliates filed for chapter 11 protection on Aug. 12, 2008
(D. Del. Case Nos. 08-11859 to 08-11866 and 08-11868 to 08-11878).  
Dennis F. Dunne, Esq., Matthew S. Barr, Esq., and Michael E.
Comerford, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New
York, serve as the Debtors' lead counsel.  James E. O'Neill, Esq.,
Laura Davis Jones, Esq. and Timothy P. Cairns, Esq., at Pachulski
Stang Ziehl & Jones LLP, in Wilmington, Delaware, serve as the
Debtors' local counsel.  When the Debtors filed for protection
from their creditors, they listed assets between $50 million and
$100 million and total debts between $100 million and
$500 million.


INTERSTATE BAKERIES: Steve Lee Wins Bakery & Retail Properties
--------------------------------------------------------------
In accordance with Section 363 of the Bankruptcy Code, Interstate
Bakeries Corp. and its debtor-affiliates conducted on Aug. 22,
2008, auctions with respect to the sale of:

   (i) a bakery property located at 5849 Crocker Street, and

  (ii) a retail property with address at 350-374 East Slauson in
       Los Angeles, California.

The highest or otherwise best bidder for the Crocker and Slauson
Properties is Steve Lee, a resident of California, at a purchase
price of $4,150,000.

The Hon. Jerry Venters of the U.S. Bankruptcy Court for the
Western District of Missouri will convene a hearing on Sept. 11,
2008, to approve the sale of the Properties to the successful
bidder.

As disclosed in the Troubled Company Reporter on Aug. 19, 2008,
the Debtors asked the Court to authorize and approve the sale of
their interest in the bakery property and the retail property in
Los Angeles, California, to Simantov Eshaghian, as the proposed
purchaser, or to better bidders, in accordance with the bidding
procedures with respect to the Properties.

The Proposed Sale involves various parcels of property, including:

   (a) the bakery property, which was formerly used as a bakery        
       and is comprised of approximately 3.34 acres of land with
       several buildings located, totaling approximately 64,249
       square feet of space; and

   (b) the retail property, which is currently being used as a
       depot and thrift store and is comprised of approximately
       0.49 acres of land with two buildings, totaling 6,623
       square feet of space.

                           About IBC

Headquartered in Kansas City, Missouri, Interstate Bakeries
Corporation is a wholesale baker and distributor of fresh-baked
bread and sweet goods, under various national brand names,
including Wonder(R), Baker's Inn(R), Merita(R), Hostess(R) and
Drake's(R).  Currently, IBC employs more than 25,000 people and
operates 45 bakeries, as well as approximately 800 distribution
centers and approximately 800 bakery outlets throughout the
country.

The company and eight of its subsidiaries and affiliates filed for
chapter 11 protection on Sept. 22, 2004 (Bankr. W.D. Mo. Case No.
04-45814).  J. Eric Ivester, Esq., and Samuel S. Ory, Esq., at
Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors
in their restructuring efforts.  When the Debtors filed for
protection from their creditors, they listed $1,626,425,000 in
total assets and $1,321,713,000 (excluding the $100,000,000 issue
of 6% senior subordinated convertible notes due Aug. 15, 2014) in
total debts.  The Debtors' filed their Chapter 11 Plan and
Disclosure Statement on Nov. 5, 2007.  Their exclusive period to
file a chapter 11 plan expired on November 8.  On Jan. 25, 2008,
the Debtors filed their First Amended Plan and Disclosure
Statement.  On Jan. 30, 2008, the Debtors received Court approval
of the First Amended Disclosure Statement.

IBC confirmed that it has not received any qualifying alternative
proposals for funding its plan of reorganization in accordance
with the Court-approved alternative proposal procedures.  As a
result, no auction was held on Jan. 22, 2008, as would have been
required under those procedures.  The deadline for submission of
alternative proposals was Jan. 15, 2008.  A new plan filing
deadline was set for June 30, 2008; no plan was filed as of that
date.

(Interstate Bakeries Bankruptcy News, Issue No. 106; Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or
215/945-7000).


JACK HALL: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------
Debtor: Jack Hall, Inc.
        5115 Berwyn Rd.
        College Park, MD 20740

Bankruptcy Case No.: 08-21226

Type of Business: The Debtor provides commercial drywall and
                  ceiling construction.

Chapter 11 Petition Date: September 2, 2008

Court: District of Maryland (Greenbelt)

Judge: Thomas J. Catliota

Debtor's Counsel: Bruce W. Henry, Esq.
                  Henry, O'Donnell, Dahnke & Walther,
                  4103 Chain Bridge Rd., Ste. 100
                  Fairfax, VA 22030
                  Tel: (703) 273-1900
                  Email: bwh@henrylaw.com

Total Assets: $934,594

Total Debts: $4,248,203

A copy of Jack Hall, Inc's petition is available for free at:

      http://bankrupt.com/misc/mdb08-21226.pdf


JIM BALL: Voluntary Chapter 11 Case Summary
-------------------------------------------
Debtor: Jim Ball Inc.
        dba Gidgets, Bungalows, Dunes, Tooley Home, Beach Buzz
        Tooley Street, ZBuz, Hepburns, Surfer Girl,
        the Buzz and Opus
        4328 Legendary Drive
        Destin, FL 32541

Bankruptcy Case No.: 08-31354

Chapter 11 Petition Date: September 3, 2008

Court: Northern District of Florida (Pensacola)

Debtor's Counsel: J. Steven Ford, Esq.
                  Wilson Harrell Farrington
                  307 S. Palafox Street
                  Pensacola, FL 32502
                  Tel 850-438-1111
                  Fax 850-432-8500
                  Email jsf@whsf-law.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.


KIMBALL HILL: Wants to Sell KHH's Mineral Estate Property
---------------------------------------------------------                       
Kimball Hill Inc. and its debtor-affiliates seek authority from
the U.S. Bankruptcy Court for the Northern District of Illinois to
sell a property in Texas that has mineral deposits, free and clear
of encumbrances and claims and subject to higher and better bids.

                        The Mineral Estate

Debtor Kimball Hill Homes Texas, Inc., owns a property in the
Southwind Subdivision, in Arlington, Texas, that contains oil and
natural gas deposits.  The Mineral Estate includes a portion of
Barnett Shale, an extensive shale zone that covers several
counties in North Texas and from which a significant amount of
natural gas is produced.

The Mineral Estate is not encumbered by any mortgages or security
interests and currently is subject to a lease with Harding
Company for oil and natural gas exploration and production, the
Debtors relate.  The Lease is freely assignable by its terms.  It
also provides for a one-time up-front payment of funds plus a 25%
royalty from all future gas production from the Mineral Estate.  

As of Aug. 26, 2008, the Debtors adds, two horizontal wells have
been drilled under the Mineral Estate -- Kimball Hill No. 1H and
Kimball Hill No. 2H.  Kimball Hill No. 2H is currently "shut-in"
pending what the Debtors understand to be a desire on the part of
the Lessee to rework the No. 2H well to improve gas production in
the future.  Since the spring of 2008, Kimball Hill No. 1H has
generated monthly royalties to KHH Texas of between $168,000 to
$215,000.  It is possible that additional wells could be drilled
under the Mineral Estate, the Debtors say.

The Debtors believe that selling the Mineral Estate will maximize
recoveries for their creditors.  The Debtors add that the
purchaser of the Mineral Estate will have the right to all future
royalties from any production from the Mineral Estate.

                        Bidding Procedures

To promote participation and active bidding and to obtain the
highest sale price for the Mineral Estate, the Debtors propose to
subject the property sale to uniform bidding procedures.

In July 2008, the Debtors sought the assistance of Gardere Wynne
Sewell LLP to assist them in marketing the Mineral Estate.  The
Debtors relate that together with Gardere, they finalized a list
of targeted bidders, the terms and conditions of the Sale, an
informational bid packet for distribution to interested bidders
and an "invitation to bid" letter.  The Debtors also placed an
advertisement in several of the major newspapers in Texas,
including The Dallas Morning News, The Fort Worth Star-Telegram,
The Austin American Statesman, The Houston Chronicle and The San
Antonio Express News.

The Debtors intend to provide the sale notice and bid procedures
to potential purchasers; accept bids; and work with the bidders
privately, to the extent necessary, in order to obtain the
highest bid.  The Debtors are in the process of contacting the
parties included in their potential bidder list.  They may
supplement the list throughout the marketing process.

The Debtors intend to distribute to each contract party an
information package, which consists of a cover letter and a copy
of the bid procedures.  

The Debtors propose that bids from interested contract parties
must contain:

   (i) the bidder's contact information,

  (ii) the amount of the bid in U.S. dollars,

(iii) a copy of a letter of credit or proposed cash escrow
       agreement, equal to 20% of the price, as deposit, which
       will be conditioned on the Court's approval and the
       delivery of the Mineral Deed for the Mineral Estate to the
       successful bidder.

The Debtors seek that all bids be submitted no later than
Sept. 26, 2008.

The Debtors will consult with the Official Committee of Unsecured
Creditors and their Prepetition Senior Secured Lenders during the
bid evaluation process, which they expect to complete no later
than Oct. 6, 2008.

A bid will only be deemed accepted upon the successful bidder's
receipt of the Debtors' written notification of bid acceptance.  
The Successful Bidder must deliver the Letter of Credit within 48
hours upon receipt of the bid acceptance notice.  The Debtors
intend to file with the Court a notice of the Successful Bid no
later than October 6.  Only upon the Court's approval of the Sale
Agreement will the Debtors be obligated to deliver the Mineral
Deed to the Successful Bidder.

The Successful Bidder must remit, by wire transfer, to the
Debtors the full amount, and the Debtors will contemporaneously
deliver the Mineral Deed to the Successful Bidder.  The Debtors
expect all bids to be without condition, except if the bidder
believes there are conditions that would additionally benefit the
Debtors.  

The Debtors maintain that they have provided extensive notice of
the proposed sale.

The Debtors also seek to assign the Oil and Gas Lease on the
Mineral Estate to the Successful Bidder, pursuant to Section 365
of the Bankruptcy Code.  The Debtors believe no defaults exist
under the Lease that need to be cured.

The Debtors ask the Court to set a hearing on Oct. 14, 2008 to
consider their sale request.  Any objections to the sale must be
formally filed with the Court no later than October 10.

The Court will convene a hearing to consider the proposed bidding
procedures on Sept. 9, 2008.  Objections are due no later than
September 4.

                        About Kimball Hill

Based in Rolling Meadow, Illinois, Kimball Hill Inc. --
http://www.kimballhillhomes.com/-- is one of the largest               
privately-owned homebuilders and one of the 30 largest
homebuilders in the United States, as measured by home deliveries
and revenues.  The company designs, builds and markets single-
family detached, single-family attached and multi-family homes.
The company currently operate within 12 markets, including, among
others, Chicago, Dallas, Fort Worth, Houston, Las Vegas,
Sacramento and Tampa, in five regions: Florida, the Midwest,
Nevada, the Pacific Coast and Texas.

Kimball Hill, Inc. and 29 of its affiliates filed for Chapter 11
protection on April 23, 2008 (Bankr. N.D. Ill. Lead Case No. 08-
10095).  Ray C. Schrock, Esq., at Kirkland & Ellis LLP, represents
the Debtors in their restructuring efforts.  The Debtors'
consolidated financial condition as of Dec. 31, 2007 reflected
total assets of $795,473,000 and total debts $631,867,000.

The Debtors have until Oct. 20, 2008, to exclusively file a
bankruptcy plan.  (Kimball Hill Bankruptcy News, Issue No. 11;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


KIMBALL HILL: Names Ken Love as New CEO, Diane Hill as Director
---------------------------------------------------------------
Kimball Hill Homes has appointed Ken Love as Executive Chairman of
the company, and Diane Hill as a Director.

Mrs. Diane Hill will be a member of the Board of Directors.  Mrs.
Hill is the wife of founder David K. Hill and is an active
philanthropist in Chicago.  Mrs. Hill retired from Northwestern
University where she served for 32 years as senior lecturer,
author and clinical supervisor in speech and language pathology.  
She is a member of several Boards including Northwest Community
Hospital, Augustana College, Northwest Community Cultural Council,
the WINGS Advisory Board and is an active member of the Harper
Community College Educational Foundation.

Mr. Love succeeds David K. Hill, founder and former Chief
Executive Officer of Kimball Hill Homes.  Mr. Love joined the
company in 2005 as Vice Chairman.  In October 2007, Mr. Love was
appointed President and Chief Executive Officer.  He has served
as a member of the Board since 2005.  Prior to joining Kimball
Hill Homes, Mr. Love held the position of Senior Partner with
Deloitte & Touche LLP for nearly three decades.

"I am honored to be following in the footsteps of such a great
leader," said Ken Love.  "As I reflect on the strengths of
everyone at Kimball Hill Homes I am awed by the level of
commitment to Caring Excellence that David inspired.  "With the
addition of Diane to the Board, I believe Kimball Hill Homes will
continue to build on these enduring principles of straightforward
business practices, extraordinary customer satisfaction and an
organization demonstrating Caring Excellence in all aspect of its
dealings."

                        About Kimball Hill

Based in Rolling Meadow, Illinois, Kimball Hill Inc. --
http://www.kimballhillhomes.com/-- is one of the largest               
privately-owned homebuilders and one of the 30 largest
homebuilders in the United States, as measured by home deliveries
and revenues.  The company designs, builds and markets single-
family detached, single-family attached and multi-family homes.
The company currently operate within 12 markets, including, among
others, Chicago, Dallas, Fort Worth, Houston, Las Vegas,
Sacramento and Tampa, in five regions: Florida, the Midwest,
Nevada, the Pacific Coast and Texas.

Kimball Hill, Inc. and 29 of its affiliates filed for Chapter 11
protection on April 23, 2008 (Bankr. N.D. Ill. Lead Case No. 08-
10095).  Ray C. Schrock, Esq., at Kirkland & Ellis LLP, represents
the Debtors in their restructuring efforts.  The Debtors'
consolidated financial condition as of Dec. 31, 2007 reflected
total assets of $795,473,000 and total debts $631,867,000.

The Debtors have until Oct. 20, 2008, to exclusively file a
bankruptcy plan.  (Kimball Hill Bankruptcy News, Issue No. 11;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


KIMBALL HILL: Committee Challenges Prepetition Lender's Lien
------------------------------------------------------------
The Official Committee of Unsecured Creditors in Kimball Hill Inc.
and its debtor-affiliates' Chapter 11 cases seeks permission from
the U.S. Bankruptcy Court for the Northern District of Illinois to
pursue certain claims and cause of action against the Debtors'
prepetition lenders on the Debtors' behalf.

Specifically, the Committee seeks to:

   (a) avoid, as constructively fraudulent transfers, the
       granting of liens by the Debtors on certain of their real
       and personal property to Harris, N.A., as agent to the
       Prepetition Lenders under the Prepetition Credit Facility;

   (b) avoid, as constructively fraudulent transfers, the
       incurrence of guarantee obligations by certain Debtors in
       connection with the Prepetition Credit Facility, pursuant
       to Sections 544 and 548(a)(1)(b) of the U.S. Bankruptcy
       Code;

   (c) avoid, as preferential transfers, the additional liens
       granted by the Debtors on their assets during the 90-day
       period before the Petition Date; and

   (d) avoid and recover, as preferential transfers, amounts paid
       by the Debtors on the Prepetition Credit Facility during
       the 90-day period before the Petition Date.

Mark L. Radtke, Esq., at Shaw Gussis Fishman Glantz Wolfson &
Towbin LLC, in Chicago, Illinois, notes that the Debtors entered
into a credit agreement with Harris N.A. and certain other
lenders in December 2005 for a $500,000,000 unsecured revolving
credit facility.  The Amended Credit Agreement dated August 2007
required the Debtors to grant the Lenders liens on substantially
all of their property.

The Committee believes that the Prepetition Lenders received pay-
downs of approximately $20,000,000 on the Prepetition Credit
Facility during the 90-day period before the Petition Date.  The
Committee argues that those payments were made on account of
prepetition antecedent debts allegedly owed to the Prepetition
Lenders; were made within 90 days before the Petition Date; and
were made at a time while the Debtors were insolvent.

The Committee adds that the Debtors failed to receive reasonably
equivalent value from the Prepetition Lenders in exchange for the
granting of the liens.

"Unless the Committee is granted standing, these valuable causes
of action will not be prosecuted," Mr. Radtke asserts.

Mr. Radtke contends that the Committee has derivative standing to
assert causes of action against the Prepetition Lenders on the
Debtors' behalf for these reasons:

   1. The Committee formally demanded on July 3, 2008, that the
      Debtors agree to it commencing and prosecuting these
      fraudulent and preferential claims.  However, according to
      the Committee, the Debtors have not formally consented to
      its demand as of August 28.

      By the express terms of the Final DIP order, the Debtors
      waived their collective rights to investigate, assert and
      prosecute any claims against the Prepetition Lenders
      arising from granting of liens and incurrence of guarantee
      obligations with respect to the Amended Credit Agreement,
      Mr. Radtke points out.

   2. The Claims are colorable claims and thus, only requiring
      the Committee to establish to the Court the existence of a
      plausible claim.

"Granting the Committee standing to prosecute the Claims is also
salient to the Committee's proper discharge of its fiduciary
duties," Mr. Radtke says.

Mr. Radtke adds that the prosecution of the Claims is critical in
the Debtors' cases because the resulting benefits will, among
other things:

   (a) strip the Prepetition Lenders of some or all of the liens
       securing the Credit Facility;

   (b) reduce or eliminate obligations of the guarantors to the
       Prepetition Lenders;

   (c) result in the Prepetition Lenders being treated equally
       with unsecured creditors instead of being senior in right
       to payment in the Debtors' cases;

   (d) produce a substantial recovery source for unsecured
       creditors; and

   (e) provide the Debtors' estates with greater flexibility in
       forming the basis of a viable plan of reorganization in
       these cases.

                        About Kimball Hill

Based in Rolling Meadow, Illinois, Kimball Hill Inc. --
http://www.kimballhillhomes.com/-- is one of the largest               
privately-owned homebuilders and one of the 30 largest
homebuilders in the United States, as measured by home deliveries
and revenues.  The company designs, builds and markets single-
family detached, single-family attached and multi-family homes.
The company currently operate within 12 markets, including, among
others, Chicago, Dallas, Fort Worth, Houston, Las Vegas,
Sacramento and Tampa, in five regions: Florida, the Midwest,
Nevada, the Pacific Coast and Texas.

Kimball Hill, Inc. and 29 of its affiliates filed for Chapter 11
protection on April 23, 2008 (Bankr. N.D. Ill. Lead Case No. 08-
10095).  Ray C. Schrock, Esq., at Kirkland & Ellis LLP, represents
the Debtors in their restructuring efforts.  The Debtors'
consolidated financial condition as of Dec. 31, 2007 reflected
total assets of $795,473,000 and total debts $631,867,000.

The Debtors have until Oct. 20, 2008, to exclusively file a
bankruptcy plan.  (Kimball Hill Bankruptcy News, Issue No. 11;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


KIM & LEE: Case Summary & Five Largest Unsecured Creditors
----------------------------------------------------------
Debtor: Kim & Lee Properties L.L.C.
         dba Creekside Plaza
        4502 Finch St.
        Mukilteo, WA 98275

Bankruptcy Case No.: 08-15672

Chapter 11 Petition Date: September 3, 2008

Court: Western District of Washington (Seattle)

Debtor's Counsel: Donald A. Bailey, Esq.
                   (donaldbailey@qwest.net)
                  Shafer & Bailey LLP
                  1218 3rd Ave., Ste. 1808
                  Seattle, WA 98101
                  Tel: (206) 682-4802

Estimated Assets: $1 million to $10 million

Estimated Debts: $1 million to $10 million

A list of the Debtor's largest unsecured creditors is available
for free at:

           http://bankrupt.com/misc/wawb08-15672.pdf      
     

KSG GROUP: Case Summary & 12 Largest Unsecured Creditors
--------------------------------------------------------
Debtor: The KSG Group, Inc.
        3653-F Flakes Mill Road, Suite 202
        Decatur, GA 30034

Bankruptcy Case No.: 08-76952

Type of Business: The Debtor is a single asset real estate as
                  defined in Section 101(51B) of the U.S.
                  Bankruptcy Code.

Chapter 11 Petition Date: August 29, 2008

Court: Northern District of Georgia

Judge: C. Ray Mullins

Debtors' Counsel: Gina A. Clements, Esq.
                  The Clements Law Group
                  4225 Flat Shaols Pkwy, Suite 404
                  Decatur, GA 30039
                  Tel: 404-212-1928

Estimated Assets: $50,000 to $1,000,000

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

A copy of the Debtor's petition is available for free at:

           http://bankrupt.com/misc/ganb08-76952.pdf


LANDSOURCE COMMUNITIES: Time to File Schedules Moved to Sept. 6
---------------------------------------------------------------
The Hon. Kevin J. Carey of the U.S. Bankruptcy Court for the
District of Delaware extended the time within which LandSource
Communites Development LLC, and its debtor-affiliates, must file
their schedules of assets and liabilities and statements of
financial affairs by an additional 60 days -- for a total of 90
days after the Petition Date -- up to September 6, 2008.

                    About LandSource Communities

LandSource Communities Development LLC, which operates in Arizona,
California, Florida, New Jersey, Nevada and Texas, is involved in
the planning and development of master planned communities and
transforming undeveloped land into ready-to-build home sites and
commercial properties.  With the exception of one development
project in Marina del Rey, California, LandSource does not build
homes or commercial properties.

LandSource and 20 of its affiliates filed for chapter 11
bankruptcy protection before the U.S. Bankruptcy Court for the
District of Delaware on June 8, 2008 (Lead Case No. 08-11111).
The Debtors are represented by Marcia Goldstein, Esq., at Weil
Gotshal & Manges in New York, and Mark D. Collins, Esq., at
Richards Layton & Finger in Wilmington, Delaware.  Lazard Freres &
Co. acts as the Debtors' financial advisors, and Kurtzmann Carson
Consultants serves as the Debtors' notice and claims agent.

According to the Troubled Company Reporter on May 22, 2008,
LandSource sought help from its lender consortium to restructure
$1.24 billion of its debt.  LandSource engaged a 100-bank lender
group led by Barclays Capital Inc., which syndicates LandSource's
debt.  LandSource had received a default notice on that debt from
the lender group after it was not able to timely meet its payments
during mid-April.  However, LandSource failed to reach an
agreement with its lenders on a plan to modify and restructure its
debt, forcing it to seek protection from creditors.

The Debtors' exclusive plan filing period expires on Oct. 6, 2008.
(LandSource Bankruptcy News, Issue No. 11;
http://bankrupt.com/newsstand/or 215/945-7000).


LANDSOURCE COMMUNITIES: Panel Can Continue Probe on Lenders' Liens
------------------------------------------------------------------
LandSource Communities Development LLC, and its debtor-affiliates,
together with the other key parties in the Debtors' cases
including Barclays Bank PLC, as agent to the First Lien Lenders
and the more than 400 other current DIP Lenders that are parties
to the $1,185,000,000 DIP Credit Agreement; The Bank of New York
Mellon, as successor administrative agent for the Second Lien
Lenders; and the Official Committee of Unsecured Creditors, have
reached an agreement extending the deadline for the Creditors'
Committee to investigate and challenge the Debtors' collateral
securing their obligations to prepetition lenders, the
enforceability of the liens securing the $1,500,000,000 in loans
from those lenders, and the acknowledgments and release of claims
against the lenders.

The key parties agree that:

   (a) The Committee's request to extend the valuation period
       and the lien challenge period, its request for documents,
       and its motion to file challenges are withdrawn without
       prejudice.

   (b) The Committee's valuation challenge period is extended
       until December 15, 2008, and will not be further extended
       for any reason without the prior written consent of
       Barclays.
          
   (c) The Committee's lien challenge period is extended until
       Dec. 26, 2008, which will not be further extended for any
       reason without the consent of the First Lien and Second
       Lien Agents.

   (d) The Committee's claims release challenge period is
       extended until December 26, 2008, and will not be further  
       extended for any reason without the consent of the First
       Lien and Second Lien Agents.
       
   (e) For the avoidance of doubt, the Parties agree that the
       Valuation Challenge Period, the Lien Challenge Period
       and the Claims Release Challenge Period may not be
       extended by court order or by any means.

   (f) No Party will make any formal or informal document or
       other information request on any other Party with
       respect to the Valuation Issues, Lien Issues or Claims
       Release Issues until after the date that is 60 days
       after the date that the Agreement is ordered; provided,
       however, that the Committee may informally request
       documents related to perfection of the liens securing
       the First Lien or Second Lien Obligations.  The Debtors,
       the Administrative Agent, and the Second Lien
       Administrative Agent agree to comply with any reasonable
       requests.

   (g) Commencing 61 days after the date that the Stipulation
       is ordered, any Party may serve formal discovery
       requests with respect to the Valuation Issues, Lien
       Issues or Claims Release Issues.

The key parties ask the Hon. Kevin J. Carey of the U.S. Bankruptcy
Court for the District of Delaware to approve the Stipulation.

As reported in the Troubled Company Reporter on Aug. 29, 2008,
Mark D. Collins, Esq., at Richards, Layton & Finger P.A., in
Wilmington, Delaware, said that the Debtors would be amenable to a
90-day extension of time for the Committee to assert any claims
regarding a Lien Challenge.  "This would provide the Debtors with
certainty as to when the Committee would make a Lien Challenge
and would prevent the prejudice that the Debtors face if the
Committee's open-ended extension request of filing 90 days after
all documents have been produced was granted," Mr. Collins
related.  "The open-ended extension would likely cause any Lien
Challenge to be filed by the Committee sometime next year," he
added.

                    About LandSource Communities

LandSource Communities Development LLC, which operates in Arizona,
California, Florida, New Jersey, Nevada and Texas, is involved in
the planning and development of master planned communities and
transforming undeveloped land into ready-to-build home sites and
commercial properties.  With the exception of one development
project in Marina del Rey, California, LandSource does not build
homes or commercial properties.

LandSource and 20 of its affiliates filed for chapter 11
bankruptcy protection before the U.S. Bankruptcy Court for the
District of Delaware on June 8, 2008 (Lead Case No. 08-11111).
The Debtors are represented by Marcia Goldstein, Esq., at Weil
Gotshal & Manges in New York, and Mark D. Collins, Esq., at
Richards Layton & Finger in Wilmington, Delaware.  Lazard Freres &
Co. acts as the Debtors' financial advisors, and Kurtzmann Carson
Consultants serves as the Debtors' notice and claims agent.

According to the Troubled Company Reporter on May 22, 2008,
LandSource sought help from its lender consortium to restructure
$1.24 billion of its debt.  LandSource engaged a 100-bank lender
group led by Barclays Capital Inc., which syndicates LandSource's
debt.  LandSource had received a default notice on that debt from
the lender group after it was not able to timely meet its payments
during mid-April.  However, LandSource failed to reach an
agreement with its lenders on a plan to modify and restructure its
debt, forcing it to seek protection from creditors.

The Debtors' exclusive plan filing period expires on Oct. 6, 2008.
(LandSource Bankruptcy News, Issue No. 11;
http://bankrupt.com/newsstand/or 215/945-7000).


LEHMAN XS: Moody's Slashes Ratings on 424 Alt-A Deal Tranches
-------------------------------------------------------------
Moody's Investors Service has downgraded the ratings of 424
tranches from 23 Alt-A transactions issued by Lehman XS Trust.  
Some 40 downgraded tranches remain on review for possible
downgrade.  Additionally, four tranches were confirmed at Aaa.  
The collateral backing these transactions consists primarily of
first-lien, fixed and adjustable-rate, Alt-A mortgage loans.

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.
Certain tranches were confirmed due to additional enhancement
provided by structural features.  The actions described below are
a result of Moody's on-going review process.

Moody's Investors Service also takes action on certain insured
notes as identified below.  The ratings on securities that are
guaranteed or "wrapped" by a financial guarantor is the higher of
a) the rating of the guarantor or b) the published underlying
rating.  The underlying ratings reflect the intrinsic credit
quality of the notes in the absence of the guarantee.  The current
ratings on the below notes are consistent with Moody's practice of
rating insured securities at the higher of the guarantor's
insurance financial strength rating and any underlying rating that
is public.

Complete rating actions are:

   Issuer: Lehman XS Trust 2006-17

   -- Cl. 1-A1, Downgraded to A2 from Aaa

   -- Cl. 1-A2, Downgraded to Baa1 from Aaa

   -- Cl. 1-A3, Downgraded to Baa1 from Aaa

   -- Cl. 1-A4A, Downgraded to Aa2 from Aaa

   -- Cl. 1-A4B, Downgraded to Baa1 from Aaa

   -- Cl. 1-A5, Downgraded to B3 from Aaa; Placed Under Review for
further Possible Downgrade

   -- Cl. 1-AIO, Downgraded to Aa2 from Aaa

   -- Cl. WF-3-1, Downgraded to Aa2 from Aaa

Financial Guarantor: MBIA Insurance Corporation (A2, negative
outlook)

Underlying Rating: Aa2

   -- Cl. WF-3-3, Downgraded to Aa3 from Aaa

   -- Cl. WF-4-1, Downgraded to Aa2 from Aaa

Financial Guarantor: MBIA Insurance Corporation (A2, negative
outlook)

Underlying Rating: Aa2

   -- Cl. WF-4-2, Downgraded to Aa2 from Aaa

   -- Cl. WF-5, Downgraded to Aa3 from Aaa

   -- Cl. WF-6-1, Downgraded to Aa3 from Aaa

Financial Guarantor: MBIA Insurance Corporation (A2, negative
outlook)

Underlying Rating: Aa3

   -- Cl. WF-6-2, Downgraded to Aa3 from Aaa

   -- Cl. WF-M1, Downgraded to Baa3 from A2

   -- Cl. WF-M2, Downgraded to B2 from Ba2; Placed Under Review
for further Possible Downgrade

   -- Cl. WF-M3, Downgraded to B3 from B1; Placed Under Review for
further Possible Downgrade

   -- Cl. WF-M4, Downgraded to Caa1 from B2

   -- Cl. WF-M5, Downgraded to Caa2 from B2

   -- Cl. WF-M6, Downgraded to Ca from B3

   -- Cl. WF-M7, Downgraded to Ca from B3

   -- Cl. WF-M8, Downgraded to C from B3

   -- Cl. WF-M9, Downgraded to C from Ca

   -- Cl. 1-M1, Downgraded to Caa2 from B3

   -- Cl. 1-M2, Downgraded to Ca from B3

   -- Cl. 1-M3, Downgraded to C from B3

   -- Cl. 1-M4, Downgraded to C from Caa1

   -- Cl. 1-M5, Downgraded to C from Caa1

   -- Cl. 1-M6, Downgraded to C from Caa1

   -- Cl. 1-M7, Downgraded to C from Ca

   -- Cl. 1-M8, Downgraded to C from Ca

   Issuer: Lehman XS Trust 2006-19

   -- Cl. A1, Downgraded to Aa1 from Aaa

   -- Cl. A2, Downgraded to Baa1 from Aaa

   -- Cl. A3, Downgraded to Baa1 from Aaa

   -- Cl. A4, Downgraded to A3 from Aaa

   -- Cl. A5, Downgraded to B3 from Aaa; Placed Under Review for
further Possible Downgrade

   -- Cl. M1, Downgraded to Ca from B3

   -- Cl. M2, Downgraded to C from B3

   -- Cl. M3, Downgraded to C from B3

   -- Cl. M4, Downgraded to C from Caa1

   -- Cl. M5, Downgraded to C from Caa1

   -- Cl. M6, Downgraded to C from Caa1

   -- Cl. M7, Downgraded to C from Ca

   -- Cl. M8, Downgraded to C from Ca

   -- Cl. M9, Downgraded to C from Ca

   Issuer: Lehman XS Trust 2007-10H

   -- Cl. I-A1-1, Downgraded to Baa1 from Aaa

   -- Cl. I-A1-2, Downgraded to Aa3 from Aaa

Financial Guarantor: Ambac Assurance Corporation (Aa3, negative
outlook)

Underlying Rating: Baa1

   -- Cl. I-A2, Downgraded to Baa2 from Aaa

   -- Cl. I-A3, Downgraded to Baa2 from Aaa

   -- Cl. I-A4-1, Downgraded to Aa3 from Aaa

Financial Guarantor: Ambac Assurance Corporation (Aa3, negative
outlook)

Underlying Rating: Caa2

   -- Cl. I-A4-2, Downgraded to Caa2 from Aaa

   -- Cl. I-AIO, Downgraded to Baa1 from Aaa

   -- Cl. II-A4, Downgraded to Aa2 from Aaa

   -- Cl. II-AIO, Confirmed at Aaa

   -- Cl. I-M1, Downgraded to Ca from B1

   -- Cl. I-M2, Downgraded to Ca from B1

   -- Cl. I-M3, Downgraded to C from B2

   -- Cl. I-M4, Downgraded to C from B2

   -- Cl. I-M5, Downgraded to C from B3

   -- Cl. I-M6, Downgraded to C from B3

   -- Cl. I-M7, Downgraded to C from B3

   -- Cl. I-M8, Downgraded to C from B3

   -- Cl. I-M9, Downgraded to C from Caa1

   -- Cl. II-M1, Downgraded to Baa1 from Aa3

   -- Cl. II-M2, Downgraded to Ba3 from A1

   -- Cl. II-M3, Downgraded to B3 from A3

   Issuer: Lehman XS Trust 2007-6

   -- Cl. 1-A1, Downgraded to A2 from Aaa

   -- Cl. 2-A1, Downgraded to Aa1 from Aaa

   -- Cl. 2-AIO, Downgraded to Aa1 from Aaa

   -- Cl. 3-A1, Downgraded to Aa3 from Aaa

Financial Guarantor: Ambac Assurance Corporation (Aa3, negative
outlook)

Underlying Rating: A1

   -- Cl. 3-A2, Downgraded to Aa3 from Aaa

Financial Guarantor: Ambac Assurance Corporation (Aa3, negative
outlook)

Underlying Rating: A1

   -- Cl. 3-A3-1, Downgraded to Aa3 from Aaa

Financial Guarantor: Ambac Assurance Corporation (Aa3, negative
outlook)

Underlying Rating: A1

   -- Cl. 3-A3-2, Downgraded to Aa3 from Aaa

Financial Guarantor: Ambac Assurance Corporation (Aa3, negative
outlook)

Underlying Rating: A1

   -- Cl. 3-A3-3, Downgraded to Aa3 from Aaa

Financial Guarantor: Ambac Assurance Corporation (Aa3, negative
outlook)

Underlying Rating: A1

   -- Cl. 3-A4, Downgraded to Aa3 from Aaa

Financial Guarantor: Ambac Assurance Corporation (Aa3, negative
outlook)

Underlying Rating: A1

   -- Cl. 3-A5, Downgraded to Aa3 from Aaa

Financial Guarantor: Ambac Assurance Corporation (Aa3, negative
outlook)

Underlying Rating: A1

   -- Cl. 3-A7, Downgraded to Aa3 from Aaa

Financial Guarantor: Ambac Assurance Corporation (Aa3, negative
outlook)

Underlying Rating: A2

   -- Cl. 3-AIO, Downgraded to A1 from Aaa

   -- Cl. A2, Downgraded to Ba3 from Aaa

   -- Cl. A3, Downgraded to Caa1 from Aaa

   -- Cl. I-M1, Downgraded to Ca from B3

   -- Cl. I-M2, Downgraded to C from B3

   -- Cl. I-M3, Downgraded to C from Caa1

   -- Cl. I-M4, Downgraded to C from Caa1

   -- Cl. I-M5, Downgraded to C from Caa1

   -- Cl. I-M6, Downgraded to C from Ca

   -- Cl. I-M7, Downgraded to C from Ca

   -- Cl. I-M8, Downgraded to C from Ca

   -- Cl. I-M9, Downgraded to C from Ca

   -- Cl. I-M10, Downgraded to C from Ca

   -- Cl. II-M1, Downgraded to Baa3 from A3

   -- Cl. II-M2, Downgraded to B2 from B1

   -- Cl. II-M3, Downgraded to B3 from B1; Placed Under Review for
further Possible Downgrade

   -- Cl. II-M4, Downgraded to B3 from B1; Placed Under Review for
further Possible Downgrade

   -- Cl. II-M5, Downgraded to Caa1 from B2

   -- Cl. II-M6, Downgraded to Caa2 from B3

   Issuer: Lehman XS Trust Mortgage Pass-Through Certificates,
Series 2007-3

   -- Cl. 1A-A1, Downgraded to Ba1 from Aaa

   -- Cl. 1A-A2, Downgraded to Caa1 from Aaa

   -- Cl. 1B-A1, Downgraded to Ba1 from Aaa

   -- Cl. 1B-A2, Downgraded to Ba1 from Aaa

   -- Cl. 1B-A3, Downgraded to Caa1 from Aaa

   -- Cl. 2-A1, Downgraded to A3 from Aaa

   -- Cl. 2-A2, Downgraded to Baa1 from Aaa

   -- Cl. 2-A3, Downgraded to Baa1 from Aaa

   -- Cl. 2-A4, Downgraded to Caa1 from Aaa

   -- Cl. 3A-A, Downgraded to B3 from Aaa; Placed Under Review for
further Possible Downgrade

   -- Cl. 3B-A2, Downgraded to Aa3 from Aaa

   -- Cl. 3B-A3, Downgraded to B3 from Aaa; Placed Under Review
for further Possible Downgrade

   -- Cl. 4A-A1, Downgraded to A1 from Aaa

   -- Cl. 4A-A3, Downgraded to A2 from Aaa

   -- Cl. 4A-A4, Downgraded to B3 from Aaa; Placed Under Review
for further Possible Downgrade

   -- Cl. 4B-A1, Downgraded to A1 from Aaa

   -- Cl. 4B-A2, Downgraded to B3 from Aaa; Placed Under Review
for further Possible Downgrade

   -- Cl. 4A-AIO, Confirmed at Aaa

   -- Cl. 4B-AIO, Downgraded to A1 from Aaa

   -- Cl. 1-M1, Downgraded to Ca from B2

   -- Cl. 1-M2, Downgraded to Ca from B3

   -- Cl. 1-M3, Downgraded to C from B3

   -- Cl. 1-M4, Downgraded to C from B3

   -- Cl. 1-M5, Downgraded to C from Ca

   -- Cl. 1-M6, Downgraded to C from Ca

   -- Cl. 1-M7, Downgraded to C from Ca

   -- Cl. 2-M1, Downgraded to Caa2 from B2

   -- Cl. 2-M2, Downgraded to Ca from B2

   -- Cl. 2-M3, Downgraded to Ca from B3

   -- Cl. 2-M4, Downgraded to Ca from B3

   -- Cl. 2-M5, Downgraded to C from Ca

   -- Cl. 2-M6, Downgraded to C from Ca

   -- Cl. 2-M7, Downgraded to C from Ca

   -- Cl. 2-M8, Downgraded to C from Ca

   -- Cl. 2-M9, Downgraded to C from Ca

   -- Cl. 3-M1, Downgraded to Caa1 from B1

   -- Cl. 3-M2, Downgraded to Caa2 from B2

   -- Cl. 3-M3, Downgraded to Ca from B3

   -- Cl. 3-M4, Downgraded to C from Ca

   -- Cl. 3-M5, Downgraded to C from Ca

   -- Cl. 4-M1, Downgraded to Caa1 from B1

   -- Cl. 4-M2, Downgraded to Caa2 from B2

   -- Cl. 4-M3, Downgraded to Ca from B3

   -- Cl. 4-M4, Downgraded to C from B3

   -- Cl. 4-M5, Downgraded to C from Ca

   -- Cl. 4-M6, Downgraded to C from Ca

   Issuer: Lehman XS Trust Series 2005-10

   -- Cl. 1-A1, Downgraded to Ba1 from Aaa

   -- Cl. 1-A3, Downgraded to Aa2 from Aaa

   -- Cl. 1-A4, Downgraded to A1 from Aaa

   -- Cl. I-A5, Downgraded to Ba2 from Aaa

Financial Guarantor: CIFG (Ba2)

Underlying Rating: Ba2

   -- Cl. 2-A2, Downgraded to Aa2 from Aaa

   -- Cl. 2-A3A, Downgraded to Aa2 from Aaa

   -- Cl. 2-A3B, Downgraded to Aa2 from Aaa

   -- Cl. 2-A4B, Downgraded to A1 from Aaa

   -- Cl. 2-A5B, Downgraded to A1 from Aaa

   -- Cl. 1-M1, Downgraded to Ca from B3

   -- Cl. 1-M2, Downgraded to C from Caa1

   -- Cl. 1-M3, Downgraded to C from Caa1

   -- Cl. 1-M4, Downgraded to C from Ca

   -- Cl. 2-M1, Downgraded to Baa1 from Aa3

   -- Cl. 2-M2, Downgraded to Baa3 from A1

   -- Cl. 2-M3, Downgraded to B3 from Baa3

   -- Cl. 2-M4, Downgraded to Ca from B3

   -- Cl. 2-M5, Downgraded to C from Ca

   Issuer: Lehman XS Trust Series 2005-2

   -- Cl. 2-A3A, Downgraded to Aa2 from Aaa

Financial Guarantor: MBIA Insurance Corporation (A2, negative
outlook)

Underlying Rating: Aa2

   -- Cl. 2-A3B, Downgraded to Aa2 from Aaa

   -- Cl. 2-A4, Downgraded to Aa2 from Aaa

   -- Cl. 1-M1, Downgraded to A2 from Aa2

   -- Cl. 1-M2, Downgraded to B3 from Baa3

   -- Cl. 1-M3, Downgraded to C from Caa1

   -- Cl. 2-M1, Downgraded to Ba2 from Baa2

   Issuer: Lehman XS Trust Series 2005-4

   -- Cl. 1-A4, Downgraded to Aa1 from Aaa

Financial Guarantor: Ambac Assurance Corporation (Aa3, negative
outlook)

Underlying Rating: Aa1

   -- Cl. 2-A2, Downgraded to A1 from Aaa

   -- Cl. 2-A3A, Downgraded to A1 from Aaa

   -- Cl. 2-A3B, Downgraded to A1 from Aaa

   -- Cl. 2-A4, Downgraded to Aa3 from Aaa

Financial Guarantor: Ambac Assurance Corporation (Aa3, negative
outlook)

Underlying Rating: A1

   -- Cl. 2-A5A, Downgraded to Aa1 from Aaa

   -- Cl. 2-A5B, Downgraded to A2 from Aaa

   -- Cl. 1-M1, Downgraded to Ba1 from A1

   -- Cl. 1-M2, Downgraded to Ca from B3

   -- Cl. 1-M3, Downgraded to C from Caa2

   -- Cl. 2-M1, Downgraded to B3 from A3

   -- Cl. 2-M2, Downgraded to Caa3 from B2

   -- Cl. 2-M3, Downgraded to C from Caa1

   Issuer: Lehman XS Trust Series 2005-8

   -- Cl. 1-A3, Downgraded to Aa3 from Aaa

   -- Cl. 1-A4, Downgraded to Ba1 from Aaa

Financial Guarantor: CIFG (Ba2)

Underlying Rating: Ba1

   -- Cl. 2-A1B, Downgraded to Aa2 from Aaa

   -- Cl. 2-A2, Downgraded to Aa2 from Aaa

   -- Cl. 2-A3, Downgraded to Aa3 from Aaa

Financial Guarantor: CIFG (Ba2)

Underlying Rating: Aa3

   -- Cl. 2-A4B, Downgraded to A1 from Aaa

   -- Cl. 1-M1, Downgraded to Caa2 from B3

   -- Cl. 1-M2, Downgraded to C from B3

   -- Cl. 1-M3, Downgraded to C from Caa1

   -- Cl. 1-M4, Downgraded to C from Ca

   -- Cl. 1-M5, Downgraded to C from Ca

   -- Cl. 2-M1, Downgraded to Baa3 from A1

   -- Cl. 2-M2, Downgraded to Ba2 from A3

   -- Cl. 2-M3, Downgraded to B3 from Ba2

   -- Cl. 2-M4, Downgraded to Caa3 from B2

   -- Cl. 2-M5, Downgraded to Ca from B3

   -- Cl. 2-M6, Downgraded to C from Caa1

   Issuer: Lehman XS Trust Series 2006-11

   -- Cl. 1-A2, Downgraded to Aa2 from Aaa

   -- Cl. 1-A3, Downgraded to Aa2 from Aaa

   -- Cl. 1-A4, Downgraded to Ba3 from Aaa

   -- Cl. 2-A1, Downgraded to Baa3 from Aaa

   -- Cl. 2-A2, Downgraded to Ba1 from Aaa

   -- Cl. 2-A3, Downgraded to Ba1 from Aaa

   -- Cl. 2-A4, Downgraded to Ba2 from Aaa

   -- Cl. M1, Downgraded to B3 from B2; Placed Under Review for
further Possible Downgrade

   -- Cl. M2, Downgraded to B3 from B2; Placed Under Review for
further Possible Downgrade

   -- Cl. M3, Downgraded to Caa1 from B3

   -- Cl. M4, Downgraded to Caa2 from B3

   -- Cl. M5, Downgraded to Ca from B3

   -- Cl. M6, Downgraded to Ca from B3

   -- Cl. M7, Downgraded to C from Caa1

   -- Cl. M8, Downgraded to C from Ca

   -- Cl. M9, Downgraded to C from Ca

   Issuer: Lehman XS Trust Series 2006-13

   -- Cl. 1-A1, Confirmed at Aaa

   -- Cl. 1-A2, Downgraded to Aa2 from Aaa

   -- Cl. 1-A3, Downgraded to Aa3 from Aaa

   -- Cl. 1-A4, Downgraded to Aa2 from Aaa

   -- Cl. 1-A5, Downgraded to B2 from Aaa

   -- Cl. 2-A1, Downgraded to Ba2 from Aaa

   -- Cl. 1-M1, Downgraded to Caa1 from B3

   -- Cl. 1-M2, Downgraded to Ca from B3

   -- Cl. 1-M3, Downgraded to Ca from B3

   -- Cl. 1-M4, Downgraded to Ca from Caa1

   -- Cl. 1-M5, Downgraded to C from Caa1

   -- Cl. 1-M6, Downgraded to C from Caa1

   -- Cl. 1-M7, Downgraded to C from Caa1

   -- Cl. 1-M8, Downgraded to C from Ca

   -- Cl. 1-M9, Downgraded to C from Ca

   -- Cl. 2-M1, Downgraded to B3 from Ba1; Placed Under Review for
further Possible Downgrade

   -- Cl. 2-M2, Downgraded to Caa3 from B1

   -- Cl. 2-M3, Downgraded to Ca from B2

   -- Cl. 2-M4, Downgraded to C from Ca

   -- Cl. 2-M5, Downgraded to C from Ca

   Issuer: Lehman XS Trust Series 2006-15

   -- Cl. A1, Downgraded to Aa1 from Aaa

   -- Cl. A2, Downgraded to Aa2 from Aaa

   -- Cl. A3, Downgraded to Aa2 from Aaa

   -- Cl. A4, Downgraded to Aa1 from Aaa

   -- Cl. A5, Downgraded to B2 from Aaa

   -- Cl. M1, Downgraded to Caa1 from B3

   -- Cl. M2, Downgraded to Caa3 from B3

   -- Cl. M3, Downgraded to Ca from B3

   -- Cl. M4, Downgraded to Ca from B3

   -- Cl. M5, Downgraded to C from B3

   -- Cl. M6, Downgraded to C from Caa1

   -- Cl. M7, Downgraded to C from Caa1

   -- Cl. M8, Downgraded to C from Ca

   -- Cl. M9, Downgraded to C from Ca

   Issuer: Lehman XS Trust Series 2006-20

   -- Cl. A1, Downgraded to A1 from Aaa

   -- Cl. A2, Downgraded to A3 from Aaa

   -- Cl. A3, Downgraded to Baa1 from Aaa

   -- Cl. A4, Downgraded to A3 from Aaa

   -- Cl. A5, Downgraded to B3 from Aaa; Placed Under Review for
further Possible Downgrade

   -- Cl. AIO, Downgraded to A1 from Aaa

   -- Cl. M1, Downgraded to Ca from B3

   -- Cl. M2, Downgraded to Ca from B3

   -- Cl. M3, Downgraded to C from B3

   -- Cl. M4, Downgraded to C from Caa1

   -- Cl. M5, Downgraded to C from Caa1

   -- Cl. M6, Downgraded to C from Caa1

   -- Cl. M7, Downgraded to C from Ca

   -- Cl. M8, Downgraded to C from Ca

   -- Cl. M9, Downgraded to C from Ca

   Issuer: Lehman XS Trust Series 2006-5

   -- Cl. 1-A1A, Downgraded to Aa1 from Aaa

   -- Cl. 1-A1B, Downgraded to Baa3 from Aaa

   -- Cl. 2-A1, Downgraded to Aa1 from Aaa

   -- Cl. 2-A2, Downgraded to Baa1 from Aaa

   -- Cl. 2-A3, Downgraded to Baa2 from Aaa

   -- Cl. 2-A4B, Downgraded to Baa3 from Aaa

   -- Cl. M1, Downgraded to B2 from A3; Placed Under Review for
further Possible Downgrade

   -- Cl. M2, Downgraded to B3 from Ba3; Placed Under Review for
further Possible Downgrade

   -- Cl. M3, Downgraded to Caa1 from B2

   -- Cl. M4, Downgraded to Ca from B3

   -- Cl. M5, Downgraded to Ca from B3

   -- Cl. M6, Downgraded to C from B3

   -- Cl. M7, Downgraded to C from Caa1

   -- Cl. M8, Downgraded to C from Ca

   -- Cl. M9, Downgraded to C from Ca

   Issuer: Lehman XS Trust Series 2006-7

   -- Cl. 1-A1A, Downgraded to Aa2 from Aaa

   -- Cl. 1-A1B, Downgraded to Ba2 from Aaa

   -- Cl. 2-A2, Downgraded to Ba1 from Aaa

   -- Cl. 2-A3A, Downgraded to Aa2 from Aaa

   -- Cl. 2-A3B, Downgraded to Ba2 from Aaa

   -- Cl. M1, Downgraded to B3 from Ba2; Placed Under Review for
further Possible Downgrade

   -- Cl. M2, Downgraded to Caa2 from B3

   -- Cl. M3, Downgraded to Ca from B3

   -- Cl. M4, Downgraded to C from B3

   -- Cl. M5, Downgraded to C from B3

   -- Cl. M6, Downgraded to C from Caa1

   -- Cl. M7, Downgraded to C from Ca

   -- Cl. M8, Downgraded to C from Ca

   -- Cl. M9, Downgraded to C from Ca

   Issuer: Lehman XS Trust Series 2006-8

   -- Cl. 1-A1B, Downgraded to A1 from Aaa

   -- Cl. 2-A1, Downgraded to Aa3 from Aaa

   -- Cl. 2-A3, Downgraded to Aa3 from Aaa

   -- Cl. 2-A4A, Confirmed at Aaa

   -- Cl. 2-A4B, Downgraded to A1 from Aaa

   -- Cl. 3-A1A, Downgraded to Aa1 from Aaa

   -- Cl. 3-A1B, Downgraded to Aa1 from Aaa

   -- Cl. 3-A2, Downgraded to Aa2 from Aaa

   -- Cl. 3-A3, Downgraded to Aa3 from Aaa

   -- Cl. 3-A4, Downgraded to Aa3 from Aaa

   -- Cl. 3-A5, Downgraded to A1 from Aaa

   -- Cl. M1, Downgraded to Baa2 from A3

   -- Cl. M2, Downgraded to Ba3 from Baa3

   -- Cl. M3, Downgraded to B3 from Ba3; Placed Under Review for
further Possible Downgrade

   -- Cl. M4, Downgraded to B3 from B2; Placed Under Review for
further Possible Downgrade

   -- Cl. M5, Downgraded to Caa1 from B2

   -- Cl. M6, Downgraded to Ca from B3

   -- Cl. M7, Downgraded to Ca from B3

   -- Cl. M8, Downgraded to C from Ca

   -- Cl. M9, Downgraded to C from Ca

   Issuer: Lehman XS Trust Series 2006-9

   -- Cl. A1B, Downgraded to Aa3 from Aaa

   -- Cl. A1C, Downgraded to Aa3 from Aaa

   -- Cl. A2, Downgraded to Ba3 from Aaa

   -- Cl. M1, Downgraded to B3 from B2; Placed Under Review for
further Possible Downgrade

   -- Cl. M2, Downgraded to Caa3 from B3

   -- Cl. M3, Downgraded to Ca from B3

   -- Cl. M4, Downgraded to Ca from B3

   -- Cl. M5, Downgraded to C from Caa1

   -- Cl. M6, Downgraded to C from Caa1

   -- Cl. M7, Downgraded to C from Ca

   -- Cl. M8, Downgraded to C from Ca

   -- Cl. M9, Downgraded to C from Ca

   Issuer: Lehman XS Trust Series 2007-1

   -- Cl. 1-A1, Downgraded to A1 from Aaa

   -- Cl. 1-A2, Downgraded to Ba1 from Aaa

   -- Cl. 1-A3, Downgraded to Ba1 from Aaa

   -- Cl. 1-A4, Downgraded to Ba1 from Aaa

   -- Cl. 1-A5, Downgraded to Caa1 from Aaa

   -- Cl. 2-A1, Downgraded to B3 from Aaa; Placed Under Review for
further Possible Downgrade

   -- Cl. WF-1, Downgraded to Baa2 from Aaa

   -- Cl. WF-M1, Downgraded to Ba3 from Baa3

   -- Cl. WF-M2, Downgraded to B3 from B1; Placed Under Review for
further Possible Downgrade

   -- Cl. WF-M3, Downgraded to Caa1 from B1

   -- Cl. WF-M4, Downgraded to Ca from B3

   -- Cl. WF-M5, Downgraded to C from Ca

   -- Cl. WF-M6, Downgraded to C from Ca

   -- Cl. WF-M7, Downgraded to C from Ca

   -- Cl. M1, Downgraded to Caa2 from B3

   -- Cl. M2, Downgraded to Ca from B3

   -- Cl. M3, Downgraded to C from B3

   -- Cl. M4, Downgraded to C from Ca

   -- Cl. M5, Downgraded to C from Ca

   -- Cl. M6, Downgraded to C from Ca

   Issuer: Lehman XS Trust Series 2007-11

   -- Cl. A1, Downgraded to B2 from Aaa

   -- Cl. A2, Downgraded to B2 from Aaa

   -- Cl. A3, Downgraded to A1 from Aaa

   -- Cl. A4, Downgraded to B3 from Aaa; Placed Under Review for
further Possible Downgrade

   -- Cl. A5, Downgraded to Caa1 from Aaa; Placed Under Review for
further Possible Downgrade

   -- Cl. AIO, Downgraded to A1 from Aaa

   -- Cl. M1, Downgraded to Ca from B1

   -- Cl. M2, Downgraded to C from B1

   -- Cl. M3, Downgraded to C from B2

   -- Cl. M4, Downgraded to C from B3

   -- Cl. M5, Downgraded to C from B3

   -- Cl. M6, Downgraded to C from B3

   -- Cl. M7, Downgraded to C from B3

   -- Cl. M8, Downgraded to C from Caa1

   -- Cl. M9, Downgraded to C from Caa1

   -- Cl. M10, Downgraded to C from Ca

   -- Cl. M11, Downgraded to C from Ca

   Issuer: Lehman XS Trust Series 2007-14H

   -- Cl. A1-1, Downgraded to Ba2 from Aaa

   -- Cl. A1-2, Downgraded to Ba2 from Aaa

   -- Cl. A2-1-1, Downgraded to Aa1 from Aaa

   -- Cl. A2-1-2, Downgraded to Ba3 from Aaa

   -- Cl. A2-2, Downgraded to Aa3 from Aaa

Financial Guarantor: Ambac Assurance Corporation (Aa3, negative
outlook)

Underlying Rating: Ba2

   -- Cl. A3, Downgraded to B3 from Aaa; Placed Under Review for
further Possible Downgrade

   -- Cl. A4, Downgraded to Aa3 from Aaa

Financial Guarantor: Ambac Assurance Corporation (Aa3, negative
outlook)

Underlying Rating: Caa1

   -- Cl. AIO, Downgraded to Aa1 from Aaa

   -- Cl. M1, Downgraded to Caa2 from B1

   -- Cl. M2, Downgraded to Caa3 from B1

   -- Cl. M3, Downgraded to Ca from B2

   -- Cl. M4, Downgraded to Ca from B2

   -- Cl. M5, Downgraded to C from B3

   -- Cl. M6, Downgraded to C from B3

   -- Cl. M7, Downgraded to C from B3

   -- Cl. M8, Downgraded to C from B3

   -- Cl. M9, Downgraded to C from Caa1

   Issuer: Lehman XS Trust Series 2007-5H

   -- Cl. 1-A1, Downgraded to A1 from Aaa

   -- Cl. 2-A1, Downgraded to Aa1 from Aaa

   -- Cl. 1-A2, Downgraded to B3 from Aaa; Placed Under Review for
further Possible Downgrade

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

   -- Cl. 1-AIO, Downgraded to A1 from Aaa

   -- Cl. 2-A2, Downgraded to B3 from Aaa; Placed Under Review for
further Possible Downgrade

   -- Cl. 3-A2, Downgraded to Caa3 from Aaa; Placed Under Review
for further Possible Downgrade

   -- Cl. 3-A3, Downgraded to B3 from Aaa; Placed Under Review for
further Possible Downgrade

   -- Cl. 3-A4, Downgraded to B3 from Aaa; Placed Under Review for
further Possible Downgrade

   -- Cl. 3-A5, Downgraded to B3 from Aaa; Placed Under Review for
further Possible Downgrade

   -- Cl. 3-AIO1, Downgraded to B3 from Aaa; Placed Under Review
for further Possible Downgrade

   -- Cl. 3-AIO2, Downgraded to B3 from Aaa; Placed Under Review
for further Possible Downgrade

   -- Cl. I-M1, Downgraded to Ca from Aa2

   -- Cl. II-M1, Downgraded to C from Aa2

   Issuer: Lehman XS Trust Series 2007-8H

   -- Cl. A1, Downgraded to Ba2 from Aaa

   -- Cl. A2, Downgraded to Ba3 from Aaa

   -- Cl. A3, Downgraded to Aa3 from Aaa

   -- Cl. A4, Downgraded to B1 from Aaa

   -- Cl. A5, Downgraded to Caa1 from Aaa

   -- Cl. AIO, Downgraded to Aa3 from Aaa

   -- Cl. M1, Downgraded to Caa2 from B1

   -- Cl. M2, Downgraded to Ca from B2

   -- Cl. M3, Downgraded to Ca from B2

   -- Cl. M4, Downgraded to C from B3

   -- Cl. M5, Downgraded to C from B3

   -- Cl. M6, Downgraded to C from B3

   -- Cl. M7, Downgraded to C from Caa1

   -- Cl. M8, Downgraded to C from Caa1

   Issuer: Lehman XS Trust Series 2007-9

   -- Cl. I-A1, Downgraded to B1 from Aaa

   -- Cl. I-A2, Downgraded to B2 from Aaa

   -- Cl. I-A3, Downgraded to B2 from Aaa

   -- Cl. I-A4, Downgraded to Caa1 from Aaa; Placed Under Review
for further Possible Downgrade

   -- Cl. I-AIO, Downgraded to B1 from Aaa

   -- Cl. WF-M1, Downgraded to Aa3 from Aa1

   -- Cl. WF-M2, Downgraded to Ba2 from A2

   -- Cl. WF-M3, Downgraded to B1 from A3; Placed Under Review for
further Possible Downgrade

   -- Cl. WF-M4, Downgraded to B2 from Baa2; Placed Under Review
for further Possible Downgrade

   -- Cl. WF-M5, Downgraded to B3 from Ba3; Placed Under Review
for further Possible Downgrade

   -- Cl. WF-M6, Downgraded to B3 from B1; Placed Under Review for
further Possible Downgrade

   -- Cl. WF-M7, Downgraded to B3 from B1; Placed Under Review for
further Possible Downgrade

   -- Cl. WF-M8, Downgraded to Caa1 from B1

   -- Cl. WF-M9, Downgraded to Ca from B2

   -- Cl. I-M1, Downgraded to Ca from B2

   -- Cl. I-M2, Downgraded to C from B3

   -- Cl. I-M3, Downgraded to C from B3

   -- Cl. I-M4, Downgraded to C from Ca

   -- Cl. I-M5, Downgraded to C from Ca

   -- Cl. I-M6, Downgraded to C from Ca

   -- Cl. I-M7, Downgraded to C from Ca

   -- Cl. I-M8, Downgraded to C from Ca

   -- Cl. I-M9, Downgraded to C from Ca


LEHMAN MORTGAGE: Moody's Pares Ratings on 129 Alt-A Deal Tranches
-----------------------------------------------------------------
Moody's Investors Service has downgraded the ratings of 129
tranches from 7 Alt-A transactions issued by Lehman Mortgage
Trust.  One tranche was placed on review for possible downgrade.
Additionally, 12 tranches were confirmed at Aaa.  The collateral
backing these transactions consists primarily of first-lien,
fixed-rate, Alt-A mortgage loans.

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.
Certain tranches were confirmed due to additional enhancement
provided by structural features.  The actions described below are
a result of Moody's on-going review process.

Moody's Investors Service also takes action on one insured tranche
as identified below.  The ratings on securities that are
guaranteed or "wrapped" by a financial guarantor is the higher of
a) the rating of the guarantor or b) the published underlying
rating.  The underlying ratings reflect the intrinsic credit
quality of the notes in the absence of the guarantee.  The current
rating on the below tranche is consistent with Moody's practice of
rating insured securities at the higher of the guarantor's
insurance financial strength rating and any underlying rating that
is public.

Complete rating actions are:

Issuer: Lehman Mortgage Trust 2005-3

   -- Cl. 1-A1, Downgraded to Aa1 from Aaa

   -- Cl. 1-A2, Downgraded to Aa1 from Aaa

   -- Cl. 1-A3, Downgraded to Aa1 from Aaa

   -- Cl. 1-A6, Downgraded to Aa1 from Aaa

   -- Cl. 1-A8, Downgraded to Aa1 from Aaa

   -- Cl. 1-A10, Downgraded to Aa1 from Aaa

   -- Cl. 1-A11, Downgraded to Aa2 from Aaa

   -- Cl. 1-A12, Downgraded to Aa2 from Aaa

   -- Cl. AP, Downgraded to Aa1 from Aaa

   -- Cl. 2-A3, Downgraded to Aa1 from Aaa

   -- Cl. 2-A4, Downgraded to Aa1 from Aaa

   -- Cl. 2-A5 Downgraded to Aa1 from Aaa

Financial Guarantor: MBIA Insurance Corporation (A2, negative
outlook)

Underlying Rating: Aa1

   -- Cl. 2-A6, Downgraded to Aa1 from Aaa

   -- Cl. 2-A7, Downgraded to Aa1 from Aaa

   -- Cl. 2-A8, Downgraded to Aa1 from Aaa

   -- Cl. 2-A9, Downgraded to Aa1 from Aaa

   -- Cl. 3-A1, Downgraded to Aa1 from Aaa

   -- Cl. 4-A2, Downgraded to Aa2 from Aaa

   -- Cl. 2-A2, Downgraded to Aa2 from Aa1

   -- Cl. B1, Downgraded to Baa1 from Aa3

   -- Cl. B2, Downgraded to Baa3 from A2

   -- Cl. B3, Downgraded to B1 from Baa3

   -- Cl. B4, Downgraded to B2 from Ba2

   -- Cl. B5, Downgraded to B3 from B2; Placed Under Review for
further Possible Downgrade

   -- Cl. B6, Downgraded to Ca from B2

Issuer: Lehman Mortgage Trust 2006-3

   -- Cl. 1-A2, Downgraded to Aa2 from Aaa

   -- Cl. 1-A3, Downgraded to Aa2 from Aaa

   -- Cl. 1-A4, Downgraded to Aa2 from Aaa

   -- Cl. 1-A5, Downgraded to Aa2 from Aaa

   -- Cl. 1-A6, Downgraded to Aa2 from Aaa

   -- Cl. 1-A7, Downgraded to Aa2 from Aaa

   -- Cl. 1-A8, Downgraded to Aa2 from Aaa

   -- Cl. 1-A9, Downgraded to Aa2 from Aaa

   -- Cl. 1-A11, Downgraded to Aa2 from Aaa

   -- Cl. 2-A1, Downgraded to A1 from Aaa

   -- Cl. 2-A2, Downgraded to A1 from Aaa

   -- Cl. 1-A13, Downgraded to Aa3 from Aa1

   -- Cl. 3-A2, Downgraded to Aa3 from Aa1

   -- Cl. M, Downgraded to Ba3 from Ba2

Issuer: Lehman Mortgage Trust 2006-5

   -- Cl. 1-A5, Downgraded to Aa2 from Aaa

   -- Cl. 1-A6, Downgraded to Aa2 from Aaa

   -- Cl. 1-A7, Downgraded to Aa2 from Aaa

   -- Cl. 1-A8, Downgraded to Aa2 from Aaa

   -- Cl. 1-A9, Downgraded to Aa2 from Aaa

   -- Cl. 1-A10, Downgraded to Aa2 from Aaa

   -- Cl. 1-A11, Downgraded to Aa2 from Aaa

   -- Cl. 1-A12, Downgraded to Aa2 from Aaa

   -- Cl. 1-A13, Downgraded to Aa2 from Aaa

   -- Cl. 1-A14, Downgraded to Aa2 from Aaa

   -- Cl. 1-A15, Downgraded to Aa2 from Aaa

   -- Cl. 1-A16, Downgraded to Aa2 from Aaa

   -- Cl. AP, Downgraded to Aa2 from Aaa

   -- Cl. AX, Confirmed at Aaa

   -- Cl. 2-A2, Confirmed at Aaa

   -- Cl. 1-A4, Downgraded to Aa3 from Aa1

   -- Cl. 2-A4, Downgraded to Aa3 from Aa1

   -- Cl. M, Downgraded to Ba2 from Baa3

Issuer: Lehman Mortgage Trust 2006-7

   -- Cl. 1-A1, Downgraded to Aa3 from Aaa

   -- Cl. 1-A4, Downgraded to Aa3 from Aaa

   -- Cl. 1-A5, Downgraded to Aa3 from Aaa

   -- Cl. 1-A7, Downgraded to Aa3 from Aaa

   -- Cl. 1-A8, Downgraded to Aa3 from Aaa

   -- Cl. 1-A9, Downgraded to Aa3 from Aaa

   -- Cl. 1-A10, Downgraded to Aa3 from Aaa

   -- Cl. AP, Downgraded to Aa3 from Aaa

   -- Cl. AX, Confirmed at Aaa

   -- Cl. 2-A4, Confirmed at Aaa

   -- Cl. 2-A5, Confirmed at Aaa

   -- Cl. 2-A7, Confirmed at Aaa

   -- Cl. 2-A1, Downgraded to Aa3 from Aaa

   -- Cl. 2-A6, Downgraded to Aa3 from Aaa

   -- Cl. 2-A9, Downgraded to Aa3 from Aaa

   -- Cl. 3-A1, Downgraded to Aa3 from Aaa

   -- Cl. 3-A2, Downgraded to Aa3 from Aaa

   -- Cl. 3-A3, Downgraded to Aa3 from Aaa

   -- Cl. 3-A4, Downgraded to Aa3 from Aaa

   -- Cl. 3-A5, Downgraded to Aa3 from Aaa

   -- Cl. 3-A6, Downgraded to Aa3 from Aaa

   -- Cl. 3-A7, Downgraded to Aa3 from Aaa

   -- Cl. 4-A1, Downgraded to Aa3 from Aaa

   -- Cl. 4-A2, Downgraded to Aa3 from Aaa

   -- Cl. 5-A5, Downgraded to A1 from Aaa

   -- Cl. 5-A7, Downgraded to A1 from Aaa

   -- Cl. 1-A6, Downgraded to Aa3 from Aa1

   -- Cl. 2-A3, Downgraded to A1 from Aa1

   -- Cl. 2-A8, Downgraded to A1 from Aa1

   -- Cl. 2-A11, Downgraded to A1 from Aa1

   -- Cl. 5-A3, Downgraded to A1 from Aa1

   -- Cl. M, Downgraded to Ba3 from Baa3

Issuer: Lehman Mortgage Trust 2006-8

   -- Cl. AP, Downgraded to A2 from Aaa

   -- Cl. 2-A2, Confirmed at Aaa

   -- Cl. 2-A3, Confirmed at Aaa

   -- Cl. 3-A1, Downgraded to A2 from Aaa

   -- Cl. 3-A2, Downgraded to A2 from Aaa

   -- Cl. 4-A1, Downgraded to A2 from Aaa

   -- Cl. 4-A2, Downgraded to A2 from Aaa

   -- Cl. 1-A2, Downgraded to A3 from Aa1

   -- Cl. 2-A4, Downgraded to A3 from Aa1

   -- Cl. M, Downgraded to Ba3 from Ba2

Issuer: Lehman Mortgage Trust 2006-9

   -- Cl. 1-A1, Downgraded to Aa3 from Aaa

   -- Cl. 1-A2, Downgraded to Aa3 from Aaa

   -- Cl. 1-A3, Downgraded to Aa3 from Aaa

   -- Cl. 1-A4, Downgraded to Aa3 from Aaa

   -- Cl. 1-A8, Downgraded to Aa3 from Aaa

   -- Cl. 1-A9, Downgraded to Aa3 from Aaa

   -- Cl. 1-A10, Downgraded to Aa3 from Aaa

   -- Cl. 1-A13, Downgraded to Aa3 from Aaa

   -- Cl. 1-A14, Downgraded to Aa3 from Aaa

   -- Cl. 1-A15, Downgraded to Aa3 from Aaa

   -- Cl. 1-A16, Downgraded to Aa3 from Aaa

   -- Cl. 1-A17, Downgraded to Aa3 from Aaa

   -- Cl. 1-A18, Downgraded to Aa3 from Aaa

   -- Cl. 1-A19, Downgraded to Aa3 from Aaa

   -- Cl. 1-A20, Downgraded to Aa3 from Aaa

   -- Cl. 1-A21, Downgraded to Aa3 from Aaa

   -- Cl. 1-A22, Downgraded to Aa3 from Aaa

   -- Cl. 1-A23, Downgraded to Aa3 from Aaa

   -- Cl. 1-A24, Downgraded to Aa3 from Aaa

   -- Cl. 1-A25, Downgraded to Aa3 from Aaa

   -- Cl. 1-A26, Downgraded to Aa3 from Aaa

   -- Cl. 1-A27, Downgraded to Aa3 from Aaa

   -- Cl. 1-A28, Downgraded to Aa3 from Aaa

   -- Cl. AP, Downgraded to Aa3 from Aaa

   -- Cl. 2-A2, Confirmed at Aaa

   -- Cl. 2-A3, Confirmed at Aaa

   -- Cl. 2-A5, Confirmed at Aaa

   -- Cl. 2-A12, Confirmed at Aaa

   -- Cl. 3-A1, Downgraded to Aa3 from Aaa

   -- Cl. 3-A2, Downgraded to Aa3 from Aaa

   -- Cl. 1-A11, Downgraded to A1 from Aa1

   -- Cl. 2-A4, Downgraded to A1 from Aa1

   -- Cl. 2-A7, Downgraded to A1 from Aa1

   -- Cl. 2-A9, Downgraded to A1 from Aa1

   -- Cl. 2-A11, Downgraded to A1 from Aa1

   -- Cl. M-1A, Downgraded to Ba3 from Baa3

   -- Cl. M-1B, Downgraded to Ba3 from Baa3

Issuer: Lehman Mortgage Trust 2007-7

   -- Cl. AP2, Downgraded to A2 from Aaa

   -- Cl. 4-A4, Downgraded to A3 from Aaa

   -- Cl. 5-A5, Downgraded to A3 from Aaa

   -- Cl. 6-A5, Placed on Review for Possible Downgrade, currently
Aaa

   -- Cl. 4-A9, Downgraded to A3 from Aa1

   -- Cl. 6-A3, Downgraded to A3 from Aa1


LIBERTY MEDIA: Asset Split Cues Fitch to Put Negative Watch
-----------------------------------------------------------
Fitch Ratings has placed the ratings for Liberty Media LLC and its
subsidiary QVC Inc. on Rating Watch Negative:

Liberty Media LLC
  -- Issuer Default Rating at 'BB';
  -- Senior unsecured debt at 'BB'.

QVC Inc.
  -- IDR at 'BB';
  -- Bank facility at 'BBB-'.

The rating action is based on the announcement by the company that
its board of directors has authorized its management to proceed
with development of a plan to split-off the assets of Liberty
Entertainment, most notably its approximately 50% stake in
DirecTV.

As previously outlined by Fitch, due to the uncertainty related to
future asset spin offs, Liberty's 'BB'-category IDR was supported
by the company's cash interest coverage of nearly 3 times as
calculated by Fitch.  While a spin-off of the DirecTV assets was
always contemplated by Fitch in its existing ratings, QVC has
produced sluggish performance over the last 12 months and now
faces a difficult domestic macro-economic environment.  As such,
Fitch believes the split-off of the DirecTV assets clearly removes
a cushion to the company's credit profile that could result in a
downgrade to the lower range of the 'BB'-category.

Pro Forma for the split-off, Fitch estimates the company's
existing portfolio of public assets will cover net debt by
approximately 0.8x before deferred tax liabilities.  These public
equity holdings are generally liquid despite non-binding ties to
exchangeable debt, equity derivatives, and strategic plans.


LINDA LAWRENCE: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Linda Manley Lawrence
        1190 E. San Martin Avenue
        San Martin, CA 95046

Bankruptcy Case No.: 08-54892

Chapter 11 Petition Date: Sept. 2, 2008

Court: Northern District of California (San Jose)

Judge: Arthur S. Weissbrodt

Debtors' Counsel: Judith Whitman, Esq.
                  Diemer, Whitman and Cardosi
                  75 E. Santa Clara Street
                  San Jose, CA 95113
                  Tel: (408) 971-6270
                  Email: jwhitman@diemerwhitman.com

Estimated Assets: $1 million to $10 million

Estimated Debts: $1 million to $10 million

A copy of Linda Manley Lawrence's petition is available for free
at http://bankrupt.com/misc/canb08-54892.pdf   


LINENS N THINGS: Court OKs Waiver of Landlords' Action Claims
-------------------------------------------------------------
According to BankruptcyData.com, the U.S. Bankruptcy Court for the
District of Delaware approved a request from Linens 'n Things Inc.
and its debtor-affiliates authorizing waiver of Sections 547 and
550 causes of action and related claims against certain landlords
who are counter-parties to the remaining leases.

The Debtors filed this motion after consulting with its official
committee of unsecured creditors.  The Debtors said that they
"will be in a position to proceed with their restructuring plans
for these cases to the benefit of various Debtors' creditor
constituencies," relates BankruptcyData.

Clifton, New Jersey-based 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 Dec. 29, 2007.  The company is a destination
retailer, offering one of the broadest and deepest selections of
high quality brand-name as well as private label home furnishings
merchandise in the industry.  Linens 'n Things has some 585
superstores (33,000 sq. ft. and larger), emphasizing low-priced,
brand-name merchandise, in more than 45 states and about seven
Canadian provinces.  Brands include Braun, Krups, Calphalon,
Laura Ashley, Croscill, Waverly, and the company's own label.
Linens 'n Things was acquired by private equity firm Apollo
Management in 2006.

On May 2, 2008, these Linens entities filed chapter 11 petition
(Bankr. D. Del.): Linens Holding Co. (08-10832), Linens 'n Things,
Inc. (08-10833), Linens 'n Things Center, Inc. (08-10834),
Bloomington, MN., L.T., Inc. (08-10835), Vendor Finance, LLC (08-
10836), LNT, Inc. (08-10837), LNT Services, Inc. (08-10838), LNT
Leasing II, LLC (08-10839), LNT West, Inc. (08-10840), LNT
Virginia LLC (08-10841), LNT Merchandising Company LLC (08-10842),
LNT Leasing III, LLC (08-10843), and Citadel LNT, LLC (08-10844).
Judge Christopher S. Sontchi presides over the case.

The Debtors' bankruptcy counsels are Mark D. Collins, Esq., John
H. Knight, Esq., and Jason M. Madron, Esq., at Richards, Layton &
Finger, P.A., provide Linens 'n Things with bankruptcy counsel.
The Debtors' special corporate counsel are Holland N. O'Neil,
Esq., Ronald M. Gaswirth, Esq., Stephen A. McCaretin, Esq.,
Randall G. Ray, Esq., and Michael S. Haynes, Esq., at Morgan,
Lewis & Bockius, LLP.  The Debtors' restructuring management
services provider is Conway Del Genio Gries & Co., LLC.  The
Debtors' CRO and Interim CEO is Michael F. Gries, co-founder of
Conways Del Genio Gries & Co., LLC.  The Debtors' claims agent is
Kurtzman Carson Consultants, LLC.  The Debtors' consultants are
Asset Disposition Advisors, LLC, and Protivit, Inc.  The Debtors'
investment bankers are Financo, Inc., and Genuity Capital Markets.


LORRO INC: Michigan Court Nixes $32 Mil. Claim Against Meridian
---------------------------------------------------------------
Judge Marci McIvor of the U.S. Bankruptcy Court for the Eastern
District of Michigan dismissed a complaint filed by Mark H.
Shapiro, Chapter 7 trustee  for Lorro, Inc., against Meridian
Automotive Systems (Delaware), Inc.

Meridian, in 1998, acquired a 49% equity interest in Lorro.
Meridian assisted Lorro in supplying parts to automotive
manufacturers and other auto suppliers.  Lorro entered into
purchase orders and other contracts with customers, and Meridian
shipped the parts directly to the customers.  The customers paid
Lorro for the parts, and Lorro, after retaining a profit mark-up,
paid Meridian for the parts.

Meridian filed for Chapter 11 bankruptcy in the U.S. Bankruptcy
Court for the District of Delaware on April 26, 2005.  In December
2006, the Delaware Court confirmed Meridian's plan of
reorganization.  

While Meridian was in bankruptcy, Lorro paid $32,742,785 to
Meridian for the auto parts.  Lorro filed a Chapter 7 bankruptcy
in the Michigan Court on April 28, 2006.  Lorro's bankruptcy
Schedules of Assets and Liabilities listed Meridian as a party to
previous litigation with Lorro, and as a creditor of Lorro.  In
September 2006, Meridian filed a $10,930,535 claim in Lorro's
bankruptcy.

In April 2008, Lorro filed the adversary proceeding against
Meridian seeking the recovery of the $32,742,785 Lorro paid to
Meridian between June 1, 2005, and April 28, 2006.  The
transfers, according to Lorro, were made prior to the February
12, 2007 administrative claims bar date in Meridian's case, and
the entry of the confirmation order of Meridian's Plan.

Meridian contended that Lorro's complaint should be dismissed
because the $32 million claims are administrative expenses, which
are barred, discharged and enjoined by the express terms of
Meridian's confirmed Plan.

Judge McIvor determined that Lorro's causes of action are
administrative expense claims in Meridian's bankruptcy.  However,
Judge McIvor dismissed Lorro's complaint because the claims and
causes of action was untimely filed.

According to Judge McIvor, Lorro was well aware of Meridian's
bankruptcy proceeding, thus it could have asserted the claims
before the confirmation of Meridian's Plan.

                About Meridian Automotive Systems

Headquartered in Dearborn, Mich., Meridian Automotive Systems
Inc. -- http://www.meridianautosystems.com/-- supplies    
technologically advanced front and rear end modules, lighting,
exterior composites, console modules, instrument panels and other
interior systems to automobile and truck manufacturers.  Meridian
operates 22 plants in the United States, Canada and Mexico,
supplying Original Equipment Manufacturers and major Tier One
parts suppliers.  The Company and its debtor-affiliates filed for
chapter 11 protection on April 26, 2005 (Bankr. D. Del. Case Nos.
05-11168 through 05-11176).  James F. Conlan, Esq., Larry J.
Nyhan, Esq., Paul S. Caruso, Esq., and Bojan Guzina, Esq., at
Sidley Austin Brown & Wood LLP, and Robert S. Brady, Esq., Edmon
L. Morton, Esq., Edward J. Kosmowski, Esq., and Ian S. Fredericks,
Esq., at Young Conaway Stargatt & Taylor, LLP, represent the
Debtors in their restructuring efforts.  Eric E. Sagerman, Esq.,
at Winston & Strawn LLP represents the Official Committee of
Unsecured Creditors.  The Committee also hired Ian Connor
Bifferato, Esq., at Bifferato, Gentilotti, Biden & Balick, P.A.,
to prosecute an adversary proceeding against Meridian's First Lien
Lenders and Second Lien Lenders to invalidate their liens.  When
the Debtors filed for protection from their creditors, they listed
$530 million in total assets and approximately $815 million in
total liabilities.  

The Hon. Mary Walrath confirmed Meridian's Revised Fourth Amended
Reorganization Plan on Dec. 6, 2006.  The company emerged from
chapter 11 protection on Dec. 29, 2006. (Meridian Bankruptcy News,
Issue No. 63; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).

                         About Lorro Inc.

Lorro, Inc. specialized in the design, engineering, program
management, manufacturing, and management of sub-suppliers for
automotive and non-automotive systems. It was a minority-owned
supplier of energy-absorbing plastic foam products for automotive
bumpers.

Lorro filed for chapter 7 liquidation before the U.S. Bankruptcy
Court for the Eastern District of Michigan on April 28, 2008.  
Randolph Wright, Esq., a partner with Berry Moorman P.C.,
represented the Debtor.

According to a May 2006 article from Automotive News, Lorro
supplied General Motors Corp., Ford Motor Co. and the Chrysler
group, and billed itself as the world's largest supplier of
energy-absorbing foam.  It sold nearly all of its manufacturing
assets and a large ownership stake in the company in 1998 to
Meridian Automotive Systems.


LUBBOCK MEDICAL: Lubbock Heritage Wins Auction with $3MM Bid
------------------------------------------------------------
Lubbock Heritage Hospital Inc. became the owner Wednesday of
troubled Highland Medical Center, Chris Van Wagenen, business
editor for the The Lubbock Avalanche-Journal, reports.

The privately held local investment group submitted the winning
bid of $3,000,001 at an auction that was held at the Lubbock law
offices of McWhorter, Cobb & Johnson.

According to Mr. Van Wagenen, Mr. Wayne Collins, who will serve as
the hospital's new chief executive officer, said it's likely the
hospital will change its name.

"This is a new company that's free and clear of all liens and
debt... It's been suggested we change the name to give a fresh
start as we look forward to a new future," Mr. Collins said.

Lubbock Heritage is a privately held local investment group led by
Dimmitt businessman Wayne Collins.

             About Lubbock Texas-Highland Medical Center

Lubbock, Texas-Highland Medical Center, L.P., doing business as
Highland Community Hospital and Highland Medical Center --
http://www.highlandcommunityhospital.com-- provides general
medical and surgical care for inpatient, outpatient, and
emergency room patients, and participates in the Medicare and
Medicaid programs.  Highland employs about 100 workers.

The Debtor filed for chapter 11 bankruptcy protection on May 31,
2008, before the U.S. Bankruptcy Court for the Northern District
of Texas (Case No. 08-50202).  Max Ralph Tarbox, Esq., at
McWhorter, Cobb & Johnson, LLP, in Lubbock, Texas, represents the
Debtor.

When it filed for bankruptcy, the Debtor disclosed $10 million to
$50 million in estimated assets and debts of the same range.


MARINE CENTER: Wants Court to Approve Sale Bidding Procedures
-------------------------------------------------------------
Marine Center Inc. and its debtor-affiliates ask the United States
Bankruptcy Court for the Central District of California to approve
proposed bidding procedures for the sale of substantially all of
their assets, free and clear of liens and interests.

A hearing is set for Sept. 23, 2008, at 11:00 a.m., to consider
the Debtors' sale request.  The hearing will take place at 21041
Burbank Blvd. in Woodland Hills, California.

The Debtors disclose that they intend to sell several properties
in Washington, Canada, and California.  The assets are subject to
competitive bidding and auction.

In August 2008, the Debtors entered into an asset purchase
agreement with Brunswick Corp.  The purchase agreement contains
certain conditions including a break-up fee of $200,000 payable to
Brunswick, if the Debtors consummate the sale to another party.  

The Debtors said in court papers that Brunswick has advised them
that it was withdrawing its offer to acquire the assets.

The Seattle Times has reported that Brunswick offered to buy the
Debtors' asset for $48 million.  Brunswick, whose brands include
Bayliner, Maxum, Meridian and Mercury Marine, already owns 12% of
the Debtors' parent, The Seattle Times pointed out.  The remainder
is mostly owned by private-equity firm The Riverside Co., of
Cleveland, which bought majority control of the Debtors in 1998
and launched an expansion push, The Seattle Times said.

According to The Seattle Times, David Shemano, Esq., in Los
Angeles, California, counsel to the Debtors' unsecured creditors,
said the Brunswick bid would leave less than $1 million for
bankruptcy costs and payments to other creditors.  The Seattle
Times said the $48 million offer would provide $47 million to
secured creditor GE Commercial Distribution Finance.

To participate in the public auction, bidders are required to
submit their offer for the asset along with a 10% of the purchase
price.

The Debtors expects the sale to close by Sept. 30, 2008.

                       About Marine Center

Headquartered in Canoga Park, California, Marine Center Inc. --
http://www.boatnut.com/-- sell sell transportation equipment in  
wholesale.  They provide boatbuilding, repairing and advertising
services.  The company and three of its affiliates filed for
Chapter 11 protection on July 17, 2008 (Bankr. C.D. Calif Lead
Case No.08-15023).  David L. Neale, Esq., and Todd M. Arnold,
Esq., at Levene Neale Bender Rankin & Brill, LLP, represent the
Debtors in their restructuring efforts.  The U.S. Trustee for
Region 16 appointed creditors to serve on an Official Committee of
Unsecured Creditors.  David B. Shemano, Esq., at Peitz Weg &
Kempinsky LLP, represents the Committee in these cases.  When the
Debtors filed for protection from their creditors, they listed
asset and debts between $50 million and $100 million each.


MATHIS PARTNERS: BB&T Forecloses on Parent's Assets
---------------------------------------------------
Mathis Partners, LLC's parent company, Comstock Homebuilding
Companies, Inc., allowed Branch Banking & Trust Co to complete
foreclosure on its properties located in Virginia and Atlanta,
William Rochelle of Bloomberg News says.  In turn, BB&T will
forgive about $32.7 million in mortgage debt and waive any
deficiency claims, the report relates.

Mr. Rochelle notes that Comstock is attempting to restructure a
"significant portion" its $144 million secured debt.  Comstock
stated that is "optimistic" about its debt restructuring efforts,
Mr. Rochelle notes.

The Troubled Company Reporter reported on April 2, 2008, that
Mathis filed a voluntary petition for reorganization in response
to a foreclosure proceeding scheduled for April 1, 2008, which was
initiated by Mathis' lender, Haven Trust Bank, on the single
project owned by Mathis.  The foreclosure proceedings were
initiated when Mathis and Haven were unable to reach an agreement
with respect to certain modifications sought by Mathis on an about
$5 million loan relating to the Gates of Luberon residential
development project in Forstyth County, Georgia.

                    About Comstock Homebuilding

Based in Reston, Viginia, Comstock Homebuilding Companies, Inc.
(NasdaqGM: CHCI) -- http://www.comstockhomebuilding.com--   
develops, builds and markets single-family homes, townhouses and
condominiums in the Washington D.C., Raleigh, North Carolina and
Atlanta, Georgia metropolitan markets.  The company also provides
certain management and administrative support services to certain
related parties.

The Troubled Company Reporter said on July 11, 2008, that Comstock
has retained FTI Consulting Inc. as advisor to the company with
respect to strategic and financial alternatives in the face of a
prolonged real estate downturn.

                        Going Concern Doubt

As reported in the Troubled Company Reporter on April 3, 2008,
PricewaterhouseCoopers LLP raised substantial doubt about the
ability of Comstock Homebuilding Companies, Inc., to continue as a
going concern after it audited the company's financial statements
for the year ended Dec. 31, 2007.  The auditor pointed stated that
the company has experienced declining market conditions and has
significant debt maturing during 2008.

                       About Mathis Partners

Reston, Virgina-based Mathis Partners, LLC --
http://www.comstockhomebuilding.com/-- is a single purpose  
limited liability company that is a wholly owned subsidiary of
Comstock Homebuilding Cos., Inc.  It was formed by Parker Chandler
Homes, Inc. to develop the Gates of Luberon residential
development project in Forstyth County, Georgia, with Haven Trust
as its lender.

It filed its chapter 11 petition on March 31, 2008 (Bankr. N.D.
Ga. Case No. 08-65876).  Judge Margaret Murphy presides over the
case.  Paul Reece Marr, Esq., at Paul Reece Marr, PC, represents
the Debtor in its restructuring efforts.  The Debtor estimated
both its assets and debts to be between $1 million and
$10 million.


MERIDIAN AUTOMOTIVE: Delaware Court Closes Chapter 11 Cases Anew
----------------------------------------------------------------
Chief Bankruptcy Judge Mary F. Walrath of the U.S. Bankruptcy
Court for the District of Delaware has approved a request by
Meridian Automotive Systems-Composites Operations, Inc., and its
affiliates to close their Chapter 11 cases.

A minutes of the hearing held on July 29, 2008, before Judge
Walrath indicated that the request to close the Debtors'
bankruptcy cases has been approved pending a written court order
under a certification to be filed by the Debtors' counsel.

The Court previously entered a final decree order in October 2007
closing the Reorganized Debtors' Chapter 11 cases.  In December
2007, the bankruptcy cases were re-opened solely to allow the
Court to consider the settlement agreement entered into by the
Reorganized Debtors and Plastech Engineered Products, Inc.

Robert S. Bradey, Esq., at Young Conaway Stargatt & Taylor, LLP,
in Wilmington, Delaware, asserted that it is rightful to close the
Reorganized Debtors' Chapter 11 cases since:

   (a) the Reorganized Debtors' estates have been fully
       administered and substantially consummated;

   (b) the Confirmation Order has become final and the Effective
       Date of the Plan has occurred;

   (c) there are no deposit requirements in the Plan;

   (d) the property required to be transferred under the Plan has
       been transferred and the Reorganized Debtors have assumed
       the management of the property dealt with by the Plan;

   (e) distributions to be made pursuant to the Plan will be made
       by the litigation trust in accordance with the terms of
       the Litigation Trust Agreement;

   (f) the Debtors have no remaining motions, contested matters
       or adversary proceedings by or against them pending before
       the Court; and

   (g) all expenses arising from the administration of the
       Debtors' estates, including court fees, U.S. Trustee fees,
       professional fees, and expenses, have been paid.

Mr. Bradey relates that Plastech has withdrawn its certification
of counsel in support of entry of a vacatur order.  Plastech is
currently undergoing bankruptcy proceedings before the U.S.
Eastern District of Michigan (Detroit), Southern Division.  In
addition, the Reorganized Debtors have paid Sherwin Williams
Company's administrative claim, which was filed in March 2008.

The Debtors asked the Court to enter a final decree closing their
Chapter 11 cases pursuant to Section 350 of the Bankruptcy Code
and Rule 3022 of the Federal Rules of Bankruptcy Procedures:

   Case No.   Debtor Entity
   --------   -------------
   05-11168   Meridian Automotive
              Systems-Composites Operations, Inc.
   
   05-11169   Meridian Automotive Systems, Inc.
   
   05-11170   Meridian Automotive
              Systems-Angola Operations, Inc.
   
   05-11171   Meridian Automotive
              Systems-Construction, Inc.

   05-11172   Meridian Automotive
              Systems-Detroit Operations, Inc.
   
   05-11173   Meridian Automotive
              Systems-Grand Rapids Operation Inc.
   
   05-11174   Meridian Automotive
              Systems-Heavy Truck Operations Inc.
   
   05-11175   Meridian Automotive
              Systems-Shreveport Operations, Inc.
   
   05-11176   Meridian Automotive
              Systems-Mexico Operations, LLC

The Kansas City Business Journal reported in July 2008 that
Meridian Automotive Systems, Inc., was scaling back operations,
including at its Kansas City, Kansas, plant, and expects to lay
off employees in eight phases, which began July 3, 2008, and would
end October 3, 2008.  Shelly MacDonald, adult services coordinator
at the Kansas Department of Commerce, told the newspaper agency
that Meridian didn't specifically state whether it would shut down
the Kansas City plant.  However, Meridian explained in a state
filing that the layoffs were due to "severe production cuts by
customers, particularly Ford Motor Co.," the report said.  
Meridian is one of Ford's largest suppliers of bumpers for trucks
and SUVs, according to the report.  Ford has cut production of
many of these vehicles as consumers flock to smaller, more fuel-
efficient vehicles, the report said.

                About Meridian Automotive Systems

Headquartered in Dearborn, Mich., Meridian Automotive Systems
Inc. -- http://www.meridianautosystems.com/-- supplies    
technologically advanced front and rear end modules, lighting,
exterior composites, console modules, instrument panels and other
interior systems to automobile and truck manufacturers.  Meridian
operates 22 plants in the United States, Canada and Mexico,
supplying Original Equipment Manufacturers and major Tier One
parts suppliers.

The Company and its debtor-affiliates filed for chapter 11
protection on April 26, 2005 (Bankr. D. Del. Case Nos. 05-11168
through 05-11176).  James F. Conlan, Esq., Larry J. Nyhan, Esq.,
Paul S. Caruso, Esq., and Bojan Guzina, Esq., at Sidley Austin
Brown & Wood LLP, and Robert S. Brady, Esq., Edmon L. Morton,
Esq., Edward J. Kosmowski, Esq., and Ian S. Fredericks, Esq., at
Young Conaway Stargatt & Taylor, LLP, represent the Debtors in
their restructuring efforts.  Eric E. Sagerman, Esq., at Winston &
Strawn LLP represents the Official Committee of Unsecured
Creditors.  The Committee also hired Ian Connor Bifferato, Esq.,
at Bifferato, Gentilotti, Biden & Balick, P.A., to prosecute an
adversary proceeding against Meridian's First Lien Lenders and
Second Lien Lenders to invalidate their liens.  When the Debtors
filed for protection from their creditors, they listed $530
million in total assets and approximately $815 million in total
liabilities.

The Hon. Mary Walrath confirmed Meridian's Revised Fourth Amended
Reorganization Plan on Dec. 6, 2006.  The company emerged from
chapter 11 protection on Dec. 29, 2006.  The Plan established The
Meridian Automotive Systems, Inc., Litigation Trust, which would
pursue claims and causes of action on behalf of the estate.  Ocean
Ridge Capital Advisors, LLC, was named litigation trustee.  
(Meridian Bankruptcy News, Issue No. 63; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).


MERIDIAN AUTOMOTIVE: Michigan Court Nixes Lorro's $32 Mil. Claim
----------------------------------------------------------------
Judge Marci McIvor of the U.S. Bankruptcy Court for the Eastern
District of Michigan dismissed a complaint filed by Mark H.
Shapiro, Chapter 7 trustee  for Lorro, Inc., against Meridian
Automotive Systems (Delaware), Inc.

Meridian, in 1998, acquired a 49% equity interest in Lorro.
Meridian assisted Lorro in supplying parts to automotive
manufacturers and other auto suppliers.  Lorro entered into
purchase orders and other contracts with customers, and Meridian
shipped the parts directly to the customers.  The customers paid
Lorro for the parts, and Lorro, after retaining a profit mark-up,
paid Meridian for the parts.  Meridian filed for Chapter 11
bankruptcy in the U.S. Bankruptcy Court for the District of
Delaware on April 26, 2005.  In December 2006, the Delaware Court
confirmed Meridian's plan of reorganization.  

While Meridian was in bankruptcy, Lorro paid $32,742,785 to
Meridian for the auto parts.  Lorro filed a Chapter 7 bankruptcy
in the Michigan Court on April 28, 2006.  Lorro's bankruptcy
Schedules of Assets and Liabilities listed Meridian as a party to
previous litigation with Lorro, and as a creditor of Lorro.  In
September 2006, Meridian filed a $10,930,535 claim in Lorro's
bankruptcy.

In April 2008, Lorro filed the adversary proceeding against
Meridian seeking the recovery of the $32,742,785 Lorro paid to
Meridian between June 1, 2005, and April 28, 2006.  The
transfers, according to Lorro, were made prior to the February
12, 2007 administrative claims bar date in Meridian's case, and
the entry of the confirmation order of Meridian's Plan.

Meridian contended that Lorro's complaint should be dismissed
because the $32 million claims are administrative expenses, which
are barred, discharged and enjoined by the express terms of
Meridian's confirmed Plan.

Judge McIvor determined that Lorro's causes of action are
administrative expense claims in Meridian's bankruptcy.  However,
Judge McIvor dismissed Lorro's complaint because the claims and
causes of action was untimely filed.

According to Judge McIvor, Lorro was well aware of Meridian's
bankruptcy proceeding, thus it could have asserted the claims
before the confirmation of Meridian's Plan.

                         About Lorro Inc.

Lorro, Inc. specialized in the design, engineering, program
management, manufacturing, and management of sub-suppliers for
automotive and non-automotive systems. It was a minority-owned
supplier of energy-absorbing plastic foam products for automotive
bumpers.

Lorro filed for chapter 7 liquidation before the U.S. Bankruptcy
Court for the Eastern District of Michigan on April 28, 2008.  
Randolph Wright, Esq., a partner with Berry Moorman P.C.,
represented the Debtor.

According to a May 2006 article from Automotive News, Lorro
supplied General Motors Corp., Ford Motor Co. and the Chrysler
group, and billed itself as the world's largest supplier of
energy-absorbing foam.  It sold nearly all of its manufacturing
assets and a large ownership stake in the company in 1998 to
Meridian Automotive Systems.

                About Meridian Automotive Systems

Headquartered in Dearborn, Mich., Meridian Automotive Systems
Inc. -- http://www.meridianautosystems.com/-- supplies    
technologically advanced front and rear end modules, lighting,
exterior composites, console modules, instrument panels and other
interior systems to automobile and truck manufacturers.  Meridian
operates 22 plants in the United States, Canada and Mexico,
supplying Original Equipment Manufacturers and major Tier One
parts suppliers.

The Company and its debtor-affiliates filed for chapter 11
protection on April 26, 2005 (Bankr. D. Del. Case Nos. 05-11168
through 05-11176).  James F. Conlan, Esq., Larry J. Nyhan, Esq.,
Paul S. Caruso, Esq., and Bojan Guzina, Esq., at Sidley Austin
Brown & Wood LLP, and Robert S. Brady, Esq., Edmon L. Morton,
Esq., Edward J. Kosmowski, Esq., and Ian S. Fredericks, Esq., at
Young Conaway Stargatt & Taylor, LLP, represent the Debtors in
their restructuring efforts.  Eric E. Sagerman, Esq., at Winston &
Strawn LLP represents the Official Committee of Unsecured
Creditors.  The Committee also hired Ian Connor Bifferato, Esq.,
at Bifferato, Gentilotti, Biden & Balick, P.A., to prosecute an
adversary proceeding against Meridian's First Lien Lenders and
Second Lien Lenders to invalidate their liens.  When the Debtors
filed for protection from their creditors, they listed $530
million in total assets and approximately $815 million in total
liabilities.

The Hon. Mary Walrath confirmed Meridian's Revised Fourth Amended
Reorganization Plan on Dec. 6, 2006.  The company emerged from
chapter 11 protection on Dec. 29, 2006.  The Plan established The
Meridian Automotive Systems, Inc., Litigation Trust, which would
pursue claims and causes of action on behalf of the estate.  Ocean
Ridge Capital Advisors, LLC, was named litigation trustee.  
(Meridian Bankruptcy News, Issue No. 63; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).


MERIDIAN AUTOMOTIVE: 2nd Qtr 2008 Post-Confirmation Report
----------------------------------------------------------
The Meridian Automotive Systems, Inc., Litigation Trust, through
Ocean Ridge Capital Advisors, LLC, as litigation trustee,
delivered to the U.S. Bankruptcy Court for the District of
Delaware a post-confirmation disbursement report for the quarter
ending June 30, 2008.

                     MAS Litigation Trust
            Quarterly Receipts/Disbursement Report
                 Quarter Ended June 30, 2008

   Litigation Trust Assets
      General Trust Account
      Additional Funding Accounts                       $274,836
      Undeliverable Cash Trust Account                         0
      Other property                                           0
   Actions:                                                    0
      Potential Avoidance Actions                              0
      Additional Preference Actions                       82,403
      Potential Reserved Actions                               0
                                                      ----------
      Total Litigation Trust Assets at 06/30/08         $357,239
                                                      ==========

   Litigation Trust Assets Received
   General Trust Account
      Wilmington Trust Company, Interest Income           $3,595
      Settlements with Defendants                      5,020,694
                                                      ----------
      Total Litigation Trust Assets Received           5,024,290
                                                      ==========

   Litigation Trust Assets Disbursed
   General Trust Account
      Barlit Beck Herman Palenchar & Scott LLP fees      324,357
      Digital Legal fees                                  37,566
      First Advantage fees                                 4,900
      Halperin Battaglia Raicht, LLP fees                 84,372
      Irish Data Services fees                            37,902
      LECG, LLC fees                                      42,840
      Meridian Automotive Systems, Inc. loan           1,972,253
      Ocean Ridge Capital Advisors, LLC fees              23,779
                                                      ----------
      Total Litigation Trust Assets Disbursed         $2,527,969
                                                      ==========
   
                     MAS Litigation Trust
                      At June 30, 2008

   Litigation Trust Assets
   Trust Accounts:
      General Trust Account                           $2,771,157
      Additional Funding Accounts                              0
      Undeliverable Cash Trust Account                         0
      Other property                                           0
   Actions:
      Potential Avoidance Actions                              
        LTA Actions                                    9,024,093
        Additional Preference Action                      37,800
      Potential Reserved Actions                               0
                                                      ----------
      Total Litigation Trust Assets at 06/30/08      $11,833,050
                                                      ==========

   Litigation Trust Liabilities
   Loans:
      Initial Funding Loan                                    $0
   Bills received/not paid:
      Bartlit Beck Herman Palenchar & Scott LLP fees     205,093
      Halperin Battaglia Raicht, LLP fees                 21,195
      LECG                                                 3,090
      Ocean Ridge Capital Advisors, LLC fees               6,859
                                                      ----------
   Total Litigation Trust Liabilities at 06/30/08       $236,237
                                                      ==========

                About Meridian Automotive Systems

Headquartered in Dearborn, Mich., Meridian Automotive Systems
Inc. -- http://www.meridianautosystems.com/-- supplies    
technologically advanced front and rear end modules, lighting,
exterior composites, console modules, instrument panels and other
interior systems to automobile and truck manufacturers.  Meridian
operates 22 plants in the United States, Canada and Mexico,
supplying Original Equipment Manufacturers and major Tier One
parts suppliers.

The Company and its debtor-affiliates filed for chapter 11
protection on April 26, 2005 (Bankr. D. Del. Case Nos. 05-11168
through 05-11176).  James F. Conlan, Esq., Larry J. Nyhan, Esq.,
Paul S. Caruso, Esq., and Bojan Guzina, Esq., at Sidley Austin
Brown & Wood LLP, and Robert S. Brady, Esq., Edmon L. Morton,
Esq., Edward J. Kosmowski, Esq., and Ian S. Fredericks, Esq., at
Young Conaway Stargatt & Taylor, LLP, represent the Debtors in
their restructuring efforts.  Eric E. Sagerman, Esq., at Winston &
Strawn LLP represents the Official Committee of Unsecured
Creditors.  The Committee also hired Ian Connor Bifferato, Esq.,
at Bifferato, Gentilotti, Biden & Balick, P.A., to prosecute an
adversary proceeding against Meridian's First Lien Lenders and
Second Lien Lenders to invalidate their liens.  When the Debtors
filed for protection from their creditors, they listed $530
million in total assets and approximately $815 million in total
liabilities.

The Hon. Mary Walrath confirmed Meridian's Revised Fourth Amended
Reorganization Plan on Dec. 6, 2006.  The company emerged from
chapter 11 protection on Dec. 29, 2006.  The Plan established The
Meridian Automotive Systems, Inc., Litigation Trust, which would
pursue claims and causes of action on behalf of the estate.  Ocean
Ridge Capital Advisors, LLC, was named litigation trustee.  
(Meridian Bankruptcy News, Issue No. 63; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).


MESABA AVIATION: Court Directs Trustee to File Final Report
-----------------------------------------------------------
Judge Gregory Kishel of the U.S. Bankruptcy Court for the District
of Minnesota directed Odyssey Capital Group, LLC, to file a final
account and report of its administration of the Liquidating Trust
under Mesaba Aviation, Inc.'s confirmed Modified Plan of
Reorganization, no later than September 10, 2008.

"A modified plan of reorganization was confirmed in this Chapter
11 case on April 9, 2007," Judge Kishel said.  "It appears that
all judicial proceedings have been finalized; the case is being
readied for closing."  

To complete the record, and to evidence the status of the
administration of assets pursuant to the confirmed plan,
Odyssey's Final Report should be submitted by Sept. 10, the Court
held.

According to Judge Kishel, if any party-in-interest, including
the Liquidating Trustee, intends to commence further judicial
proceedings, or otherwise believes there is a need for the Court
to retain any remaining post-confirmation jurisdiction, the party
will file, not later than Sept. 10, a written report describing
the nature of the proceedings and the date on which they would be
commenced.

If no report is timely filed, the Court will close the Debtor's
Chapter 11 case.

Based in Eagan, Minnesota, Mesaba Aviation Inc., dba Mesaba
Airlines -- http://www.mesaba.com/-- operates as a Northwest   
Airlink affiliate under code-sharing agreements with Northwest
Airlines(OTC:NWACQ.PK).  The company filed for chapter 11
protection on Oct. 13, 2005 (Bankr. D. Minn. Case No. 05-39258).  
Michael L. Meyer, Esq., at Ravich Meyer Kirkman McGrath & Nauman
PA, represented the Debtor in its restructuring efforts.  Craig D.
Hansen, Esq., at Squire Sanders & Dempsey, L.L.P., represented the
Official Committee of Unsecured Creditors.  When the Debtor filed
for protection from its creditors, it listed total assets of
$108,540,000 and total debts of $87,000,000.  The U.S. Bankruptcy
Court for the District of Minnesota confirmed Mesaba's Modified
Plan of Reorganization on April 9, 2007.  Mesaba exited bankruptcy
on April 24, 2007, and was later acquired by Northwest Airlines
from MAIR Holdings Inc.  (Mesaba Bankruptcy News, Issue No. 56;
Bankruptcy Creditors' Service Inc.; http://bankrupt.com/newsstand/  
or 215/945-7000)


MESABA AVIATION: Court Approves Committee Advisors' Fees
--------------------------------------------------------
Judge Gregory Kishel of the U.S. Bankruptcy Court for the District
of Minnesota approved final fee applications submitted by the
financial advisors to the Official Committee of Unsecured
Creditors in Mesaba Aviation Inc.'s chapter 11 case.

The financial advisors are:

   * Imperial Capital LLC,
   * Odyssey Capital Group, LLC, and
   * Macquarie Securities (USA) Inc.

The Financial Advisors asked the Court to allow these fees, for
the period November 16, 2005, through April 24, 2007:

   -- $2,137,500 in monthly advisory fees;
   -- a $500,000 completion fee; and
   -- an $874,169 auction services.

The Financial Advisors also asked the Court to direct
reimbursement of their out-of-pocket expenses for $190,526.

Marc A. Bilbao, managing director at Imperial Capital LLC, said
that under the engagement letters between the Financial Advisors
and the Committee, the Financial Advisors would earn a completion
fee of $500,000, upon the consummation of (i) a sale of all or
substantially all of the assets of the Debtor or (ii) a
restructuring of the Debtor pursuant to a plan of reorganization.

The Financial Advisors also asked the Court's:

   (i) final allowance of an incremental completion fee of
       $2,510,834, pursuant to the Engagement Letters; and

  (ii) approval for payment of $683,519, or the unpaid portion of
       the Incremental Completion Fee, from (a) funds escrowed
       pursuant to the Debtor's Plan of Reorganization for the
       payment of certain administrative expenses, including the
       Incremental Completion Fee, and (b) the net sale proceeds
       held in the Liquidating Trust, to the extent, if any, that
       the amount included in the Administrative Expense Escrow
       for the Incremental Completion Fee is insufficient to pay
       the Incremental Completion Fee.

The Incremental Completion Fee is calculated as 1% of the
recovery for general unsecured creditors of between 25% and 50%;
plus 3% of recoveries of between 50% and 75%; plus 5% of
recoveries in excess of 75%.

The liquidating trustee have paid unsecured claims totaling
$92,017,228 and interest totaling $8,808,922, Mr. Bilbao said.

Mr. Bilbao said that for services rendered during the Fee Period,
the Debtor has paid the Financial Advisors a total of $5,529,510
in professional fees and expenses; the Financial Advisors have not
been paid a retainer in the Debtor's Chapter 11 case.

                      Fees are Reasonable

The Financial Advisors' work in assessing the value of general
unsecured claims against Northwest Airlines, Inc., was critical
in guiding the strategy to move quickly on the sale of Mesaba's
$145,000,000 general unsecured claim against Northwest, Mr.
Bilbao said.  Imperial's auction services, and the competitive
environment fostered by the Financial Advisors in advance of the
auction through a wide marketing process, secured a price of
86.125% for Mesaba's claim against Northwest -- significantly
better than the 85.000% bid quoted by major claims dealers, he
further notes.  

The Financial Advisors believe their encouragement to move
quickly in the sale of the claim against Northwest, given their
independent assessment of the value of the claims being lower
than the then-existing market prices, and the competitive
environment the Financial Advisors' auction drove, resulted in a
substantial increase in value to the Debtor's estate over what
might have been realized had the claim sale been delayed or
performed in private negotiations with just a small number of
large claims dealers.

Mr. Bilbao further said that since the sale of the Mesaba
claim against Northwest, pricing for general unsecured trade
claims has fallen to approximately 65.000% of face amount or
equal to $30,000,000 below the level achieved through the
Imperial Auction.

Moreover, at critical points during the case, the Financial
Advisors led in advising both the Debtor and the Committee with
respect to important strategic issues, Mr. Bilbao noted.  In a
joint effort to minimize costs, the Debtor and the Committee
agreed that the Financial Advisors were in the best position to
advise on bankruptcy and restructuring issues to benefit all
parties in interest, he says.  The estate was able to obtain the
financial and restructuring advice it needed from the Financial
Advisors, without incurring the expense of hiring additional
professionals, he adds.

Mr. Bilbao explained that the Financial Advisors' work relating to
the debtor-in-possession financing was done at a time when the
Debtor's parent, MAIR Holdings, had proposed its own DIP
Financing.  He says the MAIR financing had some potentially
detrimental case-controlling features attached to it, which may
have altered the very successful outcome of the Debtor's Chapter
11 case.

In addition, Mr. Bilbao said, the Financial Advisors worked on
various ad-hoc analyses, including analysis of the Debtor's
severance and incentive plans.

Based in Eagan, Minnesota, Mesaba Aviation Inc., dba Mesaba
Airlines -- http://www.mesaba.com/-- operates as a Northwest   
Airlink affiliate under code-sharing agreements with Northwest
Airlines(OTC:NWACQ.PK).  The company filed for chapter 11
protection on Oct. 13, 2005 (Bankr. D. Minn. Case No. 05-39258).  
Michael L. Meyer, Esq., at Ravich Meyer Kirkman McGrath & Nauman
PA, represented the Debtor in its restructuring efforts.  Craig D.
Hansen, Esq., at Squire Sanders & Dempsey, L.L.P., represented the
Official Committee of Unsecured Creditors.  When the Debtor filed
for protection from its creditors, it listed total assets of
$108,540,000 and total debts of $87,000,000.  The U.S. Bankruptcy
Court for the District of Minnesota confirmed Mesaba's Modified
Plan of Reorganization on April 9, 2007.  Mesaba exited bankruptcy
on April 24, 2007, and was later acquired by Northwest Airlines
from MAIR Holdings Inc.  (Mesaba Bankruptcy News, Issue No. 56;
Bankruptcy Creditors' Service Inc.; http://bankrupt.com/newsstand/  
or 215/945-7000)


MESABA AVIATION: Must Pay $3 Mil. Airport Lease Rejection Claim
---------------------------------------------------------------
The United States District Court for the District of Minnesota
affirmed in August a ruling by the U.S. Bankruptcy Court for the
District of Minnesota granting the Metropolitan Airports
Commission's motion in limine and motion for summary judgment
against Odyssey Capital Group, LLC, the liquidating trustee for
Mesaba Aviation, Inc.'s Modified Plan of Reorganization.

District Judge Paul Magnuson held that the Bankruptcy Court did
not abuse its discretion in granting MAC's motion in limine.  
Judge Magnuson said Odyssey did not meet its burden of showing
there were genuine issues regarding MAC's calculation and
mitigation of damages.

Odyssey had sought disallowance of MAC's Claim No. 958 for
$3,111,374 in its entirety.  Michael L. Meyer, Esq., at Ravich
Meyer Kirkman McGrath & Nauman,
in Minneapolis, Minnesota, had related that MAC made a claim for
damages arising from the Debtor's rejection of its hangar lease
and admitted that all future damages sought in connection with the
Debtor's lease rejection are speculative, remote, and conjectural.  
According to Mr. Meyer, MAC's claim asserts damages that are not
recoverable or calculated according to applicable law, and that
MAC assumed the risk of any long term future losses because its
mitigation efforts were insufficient as a matter of law.

MAC, however, had asserted that it exercised reasonable efforts to
mitigate its damages resulting from the rejection of the Mesaba
Lease, and it properly calculated its claim for damages under
Minnesota law.  Connie A. Lahn, Esq., at Fafinski Mark & Johnson,
P.A., in Eden Praire, Minnesota, had said MAC properly deducted
the amounts to be received under its new lease with MN Airlines,
LLC, and properly applied the statutory damages cap under the
Bankruptcy Code in calculating its claim.

The Bankruptcy Court granted MAC's request for summary judgment
against the Liquidating Trustee, holding that MAC has shown that
it has used reasonable efforts to mitigate the damages it has
suffered, and has further shown that its calculation of its claim
is in accordance with the Bankruptcy Code.

In affirming the lower court's decision, according to the District
Court, when Odyssey's expert witness Jeffrey Johnson was deposed
on the last day of discovery, he was not prepared to provide
detailed or substantive opinions about the MN Airlines Lease or
the hangar property.  Mr. Johnson indicated that he had begun his
market research a day or two before being deposed.  Under the
circumstances, the Bankruptcy Court's conclusion that Odyssey
violated the scheduling orderby not having its expert prepared was
not an abuse of discretion, Judge Magnuson said.

MAC produced reliable affidavits from both MAC and MN Airlines
officials showing that the hangar had limited uses and that only
a few potential tenants had a need for it, Judge Magnuson opined.  
MAC's affidavits further showed that MN Airlines was the only
potential tenant interested in leasing the hangar and that MAC
sought to negotiate a 20-year lease but MN Airlines would only
accept a 10-year term.  According to the District Court, the only
admissible evidence that Odyssey produced in response was an
affidavit from counsel contending that MAC could have done more
to re-let the hangar.  To the extent that Odyssey argues on
appeal that there remains a genuine issue regarding failure to
mitigate, it asserts only that the hangar is valuable property
and that it was re-let quickly and easily.  The Bankruptcy Court
did not err by concluding that Odyssey failed to sufficiently
rebut evidence that MAC used reasonable efforts to mitigate
damages, Judge Magnuson said.

The District Court noted that MAC's claim does not subtract any
amount MAC might receive if MN Airlines chooses to exercise the
10-year option.  According to the District Court, the usual
measure of damages in the appeal's context is the rent agreed
on in the rejected lease less the actual rental value for the
rest of the term.  Moreover, Judge Magnuson said, the general
rule is that an option contract imposes no obligation on the
optionee.

In the appeal, it is reasonably certain that except for Mesaba's
rejection of the lease, MAC would have received lease payments
for the remaining 20 years of the lease, Judge Magnuson further
noted.  The only uncertain aspect is whether the 10-year option
in the subsequent lease will be exercised, and neither case
addresses the issue, he adds.

Thomas Salmen, president of MN Airlines, had said it is entirely
speculative whether MN Airlines will exercise the option given
the volatile airline industry and the uncertainty of fuel costs,
Judge Magnuson said.

Prior to the District Court's ruling, Odyssey contended, among
other things, that oral argument would aid the District Court in
resolving the issues.   Odyssey further argued that Jeffrey A.
Johnson disclosed a substantive opinion of the rental value of the
hangar.

Based in Eagan, Minnesota, Mesaba Aviation Inc., dba Mesaba
Airlines -- http://www.mesaba.com/-- operates as a Northwest   
Airlink affiliate under code-sharing agreements with Northwest
Airlines(OTC:NWACQ.PK).  The company filed for chapter 11
protection on Oct. 13, 2005 (Bankr. D. Minn. Case No. 05-39258).  
Michael L. Meyer, Esq., at Ravich Meyer Kirkman McGrath & Nauman
PA, represented the Debtor in its restructuring efforts.  Craig D.
Hansen, Esq., at Squire Sanders & Dempsey, L.L.P., represented the
Official Committee of Unsecured Creditors.  When the Debtor filed
for protection from its creditors, it listed total assets of
$108,540,000 and total debts of $87,000,000.  The U.S. Bankruptcy
Court for the District of Minnesota confirmed Mesaba's Modified
Plan of Reorganization on April 9, 2007.  Mesaba exited bankruptcy
on April 24, 2007, and was later acquired by Northwest Airlines
from MAIR Holdings Inc.  (Mesaba Bankruptcy News, Issue No. 56;
Bankruptcy Creditors' Service Inc.; http://bankrupt.com/newsstand/  
or 215/945-7000)


MESABA AVIATION: Bid for Williamsport Airport Flights Rejected
--------------------------------------------------------------
The Department of Transportation has rejected Mesaba Airlines'
offer to provide flights at the Williamsport Regional Airport
in exchange for a $3,621,295 annual subsidy, reports John Beauge
of The Patriot-News.

Two other proposals from other airlines were also rejected
because the subsidies requested by the airlines were too high,
says the report.

The DOT expects very low subsidy requests or even none because of
the quantity of passengers at the airport, said Tom M. Homan,
director of the DOT's Office of Aviation Analysis, according to
Mr. Beauge.

"We find it highly unusual that a community could go from
subsidy-free status to requiring more than $3,000,000 in
subsidy," Mr. Homan added, reports Patriot-News.

Based in Eagan, Minnesota, Mesaba Aviation Inc., dba Mesaba
Airlines -- http://www.mesaba.com/-- operates as a Northwest   
Airlink affiliate under code-sharing agreements with Northwest
Airlines(OTC:NWACQ.PK).  The company filed for chapter 11
protection on Oct. 13, 2005 (Bankr. D. Minn. Case No. 05-39258).  
Michael L. Meyer, Esq., at Ravich Meyer Kirkman McGrath & Nauman
PA, represented the Debtor in its restructuring efforts.  Craig D.
Hansen, Esq., at Squire Sanders & Dempsey, L.L.P., represented the
Official Committee of Unsecured Creditors.  When the Debtor filed
for protection from its creditors, it listed total assets of
$108,540,000 and total debts of $87,000,000.  The U.S. Bankruptcy
Court for the District of Minnesota confirmed Mesaba's Modified
Plan of Reorganization on April 9, 2007.  Mesaba exited bankruptcy
on April 24, 2007, and was later acquired by Northwest Airlines
from MAIR Holdings Inc.  (Mesaba Bankruptcy News, Issue No. 56;
Bankruptcy Creditors' Service Inc.; http://bankrupt.com/newsstand/  
or 215/945-7000)


RALI SERIES: Moody's Cuts Ratings on 172 Alt-A Deal Tranches
------------------------------------------------------------
Moody's Investors Service has downgraded the ratings of 172
tranches from 18 Alt-A transactions issued by Residential Accredit
Loans Inc.under the QA shelf.  Some 11 downgraded tranches remain
on review for possible downgrade.  Additionally, three senior
tranches were confirmed at Aaa.  The collateral backing these
transactions consists primarily of first-lien, adjustable-rate,
Alt-A mortgage loans.

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.
Certain tranches were confirmed due to additional enhancement
provided by structural features.  The actions are a result of
Moody's on-going review process.

Complete rating actions are:

Issuer: RALI Series 2005-QA11 Trust

   --    -- Cl. I-A-1, Confirmed at Aaa

   -- Cl. I-A-IO, Confirmed at Aaa

   -- Cl. II-A-1, Downgraded to A2 from Aaa

   -- Cl. III-A-1, Downgraded to A2 from Aaa

   -- Cl. IV-A-1, Downgraded to Aa2 from Aaa

   -- Cl. V-A-1, Downgraded to A2 from Aaa

   -- Cl. VI-A-1, Downgraded to A2 from Aaa

   -- Cl. M-1, Downgraded to B3 from Baa3

   -- Cl. M-2, Downgraded to Ca from B2

   -- Cl. M-3, Downgraded to C from B3

Issuer: RALI Series 2005-QA13 Trust

   -- Cl. I-A-1, Downgraded to Aa1 from Aaa

   -- Cl. I-A-2, Downgraded to Baa3 from Aaa

   -- Cl. II-A-1, Downgraded to Baa2 from Aaa

   -- Cl. III-A-1, Downgraded to Aa1 from Aaa

   -- Cl. III-A-2, Downgraded to Baa3 from Aaa

   -- Cl. M-1, Downgraded to Caa1 from Ba2

   -- Cl. M-2, Downgraded to Ca from B3

   -- Cl. M-3, Downgraded to C from Ca

Issuer: RALI Series 2006-QA1 Trust

   -- Cl. A-I-1, Downgraded to Aa1 from Aaa

   -- Cl. A-I-2, Downgraded to B1 from Aaa

   -- Cl. A-II-1, Downgraded to Aa1 from Aaa

   -- Cl. A-II-2, Downgraded to B1 from Aaa

   -- Cl. A-III-1, Downgraded to Aa1 from Aaa

   -- Cl. A-III-2, Downgraded to B1 from Aaa

   -- Cl. M-1, Downgraded to Ca from B1

   -- Cl. M-2, Downgraded to C from B3

   -- Cl. M-3, Downgraded to C from Ca

Issuer: RALI Series 2006-QA10 Trust

   -- Cl. A-1, Downgraded to B3 from Aaa

   -- Cl. A-2, Downgraded to A3 from Aaa

   -- Cl. A-3, Downgraded to B3 from Aaa; Placed Under Review for
further Possible Downgrade

   -- Cl. M-1, Downgraded to Ca from B3

   -- Cl. M-2, Downgraded to C from Ca

   -- Cl. M-3, Downgraded to C from Ca

   -- Cl. M-4, Downgraded to C from Ca

   -- Cl. M-5, Downgraded to C from Ca

   -- Cl. M-6, Downgraded to C from Ca

Issuer: RALI Series 2006-QA11 Trust

   -- Cl. A-1, Downgraded to Ba3 from Aaa

   -- Cl. A-2, Downgraded to Caa2 from Aaa

   -- Cl. M-1, Downgraded to C from B3

   -- Cl. M-2, Downgraded to C from Ca

   -- Cl. M-3, Downgraded to C from Ca

   -- Cl. M-4, Downgraded to C from Ca

   -- Cl. M-5, Downgraded to C from Ca

Issuer: RALI Series 2006-QA2 Trust

   -- Cl. I-A-1, Downgraded to A1 from Aaa

   -- Cl. I-A-IO, Downgraded to A1 from Aaa

   -- Cl. II-A-1, Downgraded to A1 from Aaa

   -- Cl. II-A-IO, Downgraded to A1 from Aaa

   -- Cl. III-A-1, Downgraded to A1 from Aaa

   -- Cl. III-A-IO, Downgraded to A1 from Aaa

   -- Cl. I-A-2, Downgraded to B2 from Aa1

   -- Cl. II-A-2, Downgraded to B2 from Aa1

   -- Cl. III-A-2, Downgraded to B2 from Aa1

   -- Cl. M-1, Downgraded to Ca from B2

   -- Cl. M-2, Downgraded to C from B3

   -- Cl. M-3, Downgraded to C from Ca

Issuer: RALI Series 2006-QA3 Trust

   -- Cl. A-1, Downgraded to Aa1 from Aaa

   -- Cl. A-2, Downgraded to Aa1 from Aaa

   -- Cl. A-3, Downgraded to Ba3 from Aaa

   -- Cl. M-1, Downgraded to Caa1 from Baa2

   -- Cl. M-2, Downgraded to Ca from B2

   -- Cl. M-3, Downgraded to Ca from B2

   -- Cl. M-4, Downgraded to Ca from B3

   -- Cl. M-5, Downgraded to C from B3

   -- Cl. M-6, Downgraded to C from B3

   -- Cl. M-7, Downgraded to C from B3

   -- Cl. M-8, Downgraded to C from Ca

   -- Cl. M-9, Downgraded to C from Ca

Issuer: RALI Series 2006-QA4 Trust

   -- Cl. A, Downgraded to Ba1 from Aaa

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

   -- Cl. M-2, Downgraded to Caa3 from B1

   -- Cl. M-3, Downgraded to Ca from B2

   -- Cl. M-4, Downgraded to Ca from B3

   -- Cl. M-5, Downgraded to Ca from B3

   -- Cl. M-6, Downgraded to C from B3

   -- Cl. M-7, Downgraded to C from Caa1

   -- Cl. M-8, Downgraded to C from Ca

   -- Cl. M-9, Downgraded to C from Ca

   -- Cl. M-10, Downgraded to C from Ca

Issuer: RALI Series 2006-QA5 Trust

   -- Cl. I-A-1, Downgraded to Baa1 from Aaa

   -- Cl. I-A-2, Confirmed at Aaa

   -- Cl. I-A-3, Downgraded to Baa2 from Aaa

   -- Cl. II-A-2, Downgraded to Baa3 from Aa1

   -- Cl. I-M-1, Downgraded to B3 from Baa3

   -- Cl. I-M-2, Downgraded to Caa1 from B3

   -- Cl. I-M-3, Downgraded to Ca from B3

   -- Cl. I-M-4, Downgraded to Ca from B3

   -- Cl. I-M-5, Downgraded to Ca from B3

   -- Cl. I-M-6, Downgraded to C from Caa1

   -- Cl. I-M-7, Downgraded to C from Ca

   -- Cl. I-M-8, Downgraded to C from Ca

   -- Cl. I-M-9, Downgraded to C from Ca

   -- Cl. II-M-1, Downgraded to B3 from B2; Placed Under Review
for further Possible Downgrade

Issuer: RALI Series 2006-QA6 Trust

   -- Cl. A-1, Downgraded to Ba1 from Aaa

   -- Cl. A-4, Downgraded to Ba2 from Aaa

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

   -- Cl. M-2, Downgraded to Caa1 from Ba1

   -- Cl. M-3, Downgraded to Caa3 from B2

   -- Cl. M-4, Downgraded to Ca from B2

   -- Cl. M-5, Downgraded to Ca from B2

   -- Cl. M-6, Downgraded to Ca from B3

   -- Cl. M-7, Downgraded to C from Caa1

   -- Cl. M-8, Downgraded to C from Ca

   -- Cl. M-9, Downgraded to C from Ca

   -- Cl. B, Downgraded to C from Ca

Issuer: RALI Series 2006-QA7 Trust

   -- Cl. I-A-1, Downgraded to B2 from Aaa

   -- Cl. II-A-1, Downgraded to A2 from Aaa

   -- Cl. II-A-2, Downgraded to B3 from Aaa; Placed Under Review
for further Possible Downgrade

   -- Cl. M-1, Downgraded to Ca from B2

   -- Cl. M-2, Downgraded to Ca from B2

   -- Cl. M-3, Downgraded to C from B3

   -- Cl. M-4, Downgraded to C from B3

   -- Cl. M-5, Downgraded to C from B3

   -- Cl. M-6, Downgraded to C from Caa1

   -- Cl. M-7, Downgraded to C from Ca

   -- Cl. M-8, Downgraded to C from Ca

   -- Cl. M-9, Downgraded to C from Ca

   -- Cl. M-10, Downgraded to C from Ca

Issuer: RALI Series 2006-QA8 Trust

   -- Cl. A-1, Downgraded to B3 from Aaa

   -- Cl. A-2, Downgraded to A3 from Aaa

   -- Cl. A-3, Downgraded to B3 from Aaa; Placed Under Review for
further Possible Downgrade

   -- Cl. M-1, Downgraded to Ca from B2

   -- Cl. M-2, Downgraded to Ca from B3

   -- Cl. M-3, Downgraded to C from B3

   -- Cl. M-4, Downgraded to C from B3

   -- Cl. M-5, Downgraded to C from B3

   -- Cl. M-6, Downgraded to C from Caa1

   -- Cl. M-7, Downgraded to C from Ca

   -- Cl. M-8, Downgraded to C from Ca

   -- Cl. M-9, Downgraded to C from Ca

Issuer: RALI Series 2006-QA9 Trust

   -- Cl. A-2, Downgraded to Ba2 from Aaa

   -- Cl. M-1, Downgraded to Caa3 from B2

   -- Cl. M-2, Downgraded to Ca from B3

   -- Cl. M-3, Downgraded to C from B3

   -- Cl. M-4, Downgraded to C from Ca

   -- Cl. M-5, Downgraded to C from Ca

   -- Cl. M-6, Downgraded to C from Ca

Issuer: RALI Series 2007-QA1 Trust

   -- Cl. A-1, Downgraded to B3 from Aaa

   -- Cl. A-2, Downgraded to B3 from Aaa; Placed Under Review for
further Possible Downgrade

   -- Cl. A-3, Downgraded to Baa3 from Aaa

   -- Cl. A-4, Downgraded to Caa1 from Aaa; Placed Under Review
for further Possible Downgrade

   -- Cl. M-1, Downgraded to C from B3

   -- Cl. M-2, Downgraded to C from Ca

   -- Cl. M-3, Downgraded to C from Ca

   -- Cl. M-4, Downgraded to C from Ca

   -- Cl. M-5, Downgraded to C from Ca

Issuer: RALI Series 2007-QA2 Trust

   -- Cl. A-1, Downgraded to B3 from Aaa

   -- Cl. A-2, Downgraded to B3 from Aaa; Placed Under Review for
further Possible Downgrade

   -- Cl. A-3, Downgraded to Ba2 from Aaa

   -- Cl. A-4, Downgraded to Caa1 from Aaa; Placed Under Review
for further Possible Downgrade

   -- Cl. M-1, Downgraded to C from B3

   -- Cl. M-2, Downgraded to C from Ca

   -- Cl. M-3, Downgraded to C from Ca

   -- Cl. M-4, Downgraded to C from Ca

Issuer: RALI Series 2007-QA3 Trust

   -- Cl. A-4, Downgraded to B1 from Aaa

   -- Cl. A-5, Downgraded to Caa1 from Aaa

   -- Cl. M-1, Downgraded to C from B3

   -- Cl. M-2, Downgraded to C from Ca

   -- Cl. M-3, Downgraded to C from Ca

   -- Cl. M-4, Downgraded to C from Ca

   -- Cl. M-5, Downgraded to C from Ca

Issuer: RALI Series 2007-QA4 Trust

   -- Cl. A-1-A, Downgraded to B1 from Aaa

   -- Cl. A-1-B, Downgraded to B1 from Aaa

   -- Cl. A-2, Downgraded to Caa1 from Aaa

   -- Cl. M-1, Downgraded to C from B2

   -- Cl. M-2, Downgraded to C from Ca

   -- Cl. M-3, Downgraded to C from Ca

   -- Cl. M-4, Downgraded to C from Ca

Issuer: RALI Series 2007-QA5 Trust

   -- Cl. I-A-1, Downgraded to Ba2 from Aaa

   -- Cl. I-A-2, Downgraded to B2 from Aaa

   -- Cl. II-A-1, Downgraded to Ba2 from Aaa

   -- Cl. II-A-2, Downgraded to B2 from Aaa

   -- Cl. III-A-1, Downgraded to Ba1 from Aaa

   -- Cl. III-A-2, Downgraded to B2 from Aaa

   -- Cl. M-1, Downgraded to B3 from B1; Placed Under Review for
further Possible Downgrade

   -- Cl. M-3, Downgraded to C from Ca


MGM MIRAGE: S&P Confirms 'BB' Corporate Credit Rating
-----------------------------------------------------
Standard & Poor's Ratings Services revised its rating outlook on
Las Vegas-based MGM MIRAGE to negative from stable.  Ratings on
the company, including the 'BB' corporate credit rating, were
affirmed.

The outlook revision reflects our concern regarding two specific
challenges MGM MIRAGE faces over the next several quarters.  
First, while the company appears close to completing a $3 billion
debt financing for the CityCenter project, S&P anticipate that
each partner will need to contribute at least an additional $500
million to $1 billion over the next 12 months to
complete the project.

This incremental spending could have a meaningful impact
on the company's liquidity profile, given MGM MIRAGE's outlined
capital spending plans for its wholly owned properties of
approximately $400 million during the remainder of 2008, S&P's
expectation that 2009 capital expenditures will be in the $300
million to $500 million range, and cash from operations
totaling just $573 million during the 12 months ended June 30,
2008.  While a $302 million tax payment related to the sale of
CityCenter weighed negatively on cash from operations during this
period, the company needs to generate a level of cash from
operations which approximates, or exceeds, capital spending
requirements in order to maintain sufficient excess liquidity to
support the current rating.

S&P are also concerned with MGM MIRAGE's ability to remain in
compliance with the covenants under its bank facility.  Given the
trend of EBITDA performance thus far in 2008, combined with our
expectation that current negative trends will continue at least
into the first half of 2009, a covenant violation is likely over
the next few quarters.  Specifically, S&P are projecting that
total property level EBITDA, which declined 15% during the first
six months of 2008, will decline at a similar pace for the
remainder of 2008.  While cost-containment efforts should have
gained traction, and year-over-year comparisons will be easier in
2009, S&P expect that a mid-single-digit percentage decline in
total property level EBITDA is likely in the first quarter of
2009, at which point a covenant violation would likely occur.  S&P
expect MGM MIRAGE to be successful in amending covenant levels;
however, the payment of fees or an increase in pricing is a likely
consequence.

"The 'BB' rating reflects MGM MIRAGE's somewhat limited geographic
diversity, as the company relies on the Las Vegas Strip for a
majority of its cash flow, and high debt leverage," noted Standard
& Poor's credit analyst Ben Bubeck.  "Still, MGM maintains a
satisfactory business risk profile, with a significant position on
the Las Vegas Strip, which, despite current challenges stemming
from a weak economy, offers a substantial source of cash flow and
solid long-term prospects."

Furthermore, the company's business risk profile stands to improve
over time, as the recent openings of the permanent casino at MGM
Grand Detroit and MGM Grand Macau, combined with the potential
longer-term addition of MGM Grand Atlantic City, will lessen the
company's reliance on the Las Vegas Strip and grow the cash flow
base.  Other ventures overseas, such as the MGM Grand Abu
Dhabi, also have the potential to grow and diversify MGM MIRAGE's
cash flow base over time.


MICHAEL JAMES: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Michael James Morris
        510 South Dakota Avenue
        Tampa, FL 33606

Bankruptcy Case No.: 08-13439

Chapter 11 Petition Date: September 2, 2008

Court: Middle District of Florida

Judge: Caryl E. Delano

Debtors' Counsel: Buddy D. Ford, Esq.
                  (Buddy@tampaesq.com)
                  115 North MacDill Avenue
                  Tampa, FL 33609-1521
                  Tel: (813) 877-4669
                  Fax: (813) 877-5543

Total Assets: $1,206,179

Total Debts: $2,317,936

A copy of Debtor's petition is available for free at:

           http://bankrupt.com/misc/flmb08-13439.pdf


MIDWEST AIR: Pilots Irate at Pact With Republic Airways
-------------------------------------------------------
Captain Jay Schnedorf, chairman of the Midwest Airlines unit of
the Air Line Pilots Association, issued a statement following
Midwest Airlines' announcement that it had secured commitments
from Republic Airways Holdings.

As part of the deal, Midwest announced that Republic flightcrews
would fly 12 EMB 170s as Midwest Connect, beginning Oct. 1, 2008,
directly replacing all but nine of the Boeing 717 aircraft flown
by Midwest pilots.

"This is catastrophic news for our pilot group and for all Midwest
employees.  Management's plan to replace all but nine of our B-
717s with EMB 170s and replace Midwest pilots with Republic pilots
will have a devastating impact -- raising the number of Midwest
pilots who are out of work to approximately 300 of the some 400
pilots who were employed before TPG/NWA purchased the airline
earlier this year. Furthermore, management restated its continued
intent to wring drastic, draconian concessions from our pilots,
holding our very jobs hostage as part of its deal with Republic.

"Midwest pilots are outraged that management is using such
underhanded tactics and further decimating this airline. We are
putting management on notice that they cannot hold a gun to our
heads and deal with our pilot group in this manner.  We strongly
believe that management's actions are a repudiation of its
contract with us, and we are exploring all of our options to
protect our pilots and hold management accountable for the deal it
made with us in 2000 and the concessions we made during our
company's restructuring in 2003.

"A year ago, CEO Tim Hoeksema stated publicly that the deal with
TPG/Northwest would 'be good for our airline, the employees, and
the community.'  Make no mistake: with this latest deal, Mr.
Hoeksema, TPG, and Northwest have revealed their complete
disregard for this airline and its employees.  Today marks a dark
day in the history of Milwaukee, Wisconsin, as management has
essentially sounded the death knell for Midwest Airlines and the
reputation the employees have built for providing the 'best care
in the air."

ALPA is the bargaining representative for the 400 pilots at
Midwest Airlines.  Founded in 1931, ALPA represents 53,000 pilots
at 37 airlines in the United States and Canada.

                        About Midwest Air

Oak Creek, Wisconsin-based Midwest Air Group Inc. --
http://www.midwestairlines.com/-- is a holding company of Midwest       
Airlines, Inc.  Midwest Airlines operates a passenger jet airline
that serves destinations throughout the United States from
Milwaukee, Wisconsin and Kansas City, Missouri.  Skyway Airlines,
Inc., dba Midwest Connect, is a wholly owned subsidiary of Midwest
Airlines and serves as the regional airline for the company.  
Midwest Airlines and Midwest Connect constitute the company's
segments.  It has three principal product offerings: Midwest
Airlines Signature Service, Midwest Airlines Saver Service and
Midwest Connect regional service.  As of Dec. 31, 2006, Midwest
Airlines Signature Service operated in 20 cities in the United
States, and Midwest Airlines Saver Service operated in 10 cities.  
Midwest Connect builds feeder traffic and provides regional
scheduled passenger service to cities primarily in the Midwest.  
Its subsidiaries provide aircraft charter services, transport air
freight and mail.  The company has a total of more than 3,000
workers.

As of Sept. 30, 2007, Midwest Air Group listed total assets of
$395,615,000, total liabilities of $331,810,000, and total
stockholders' equity of $63,805,000.
                       

MIDWEST AIR: Obtains $60Mil. Financing From Republic Airways & TPG
------------------------------------------------------------------
Midwest Air Group Inc. disclosed significant progress in its
voluntary restructuring plan and $60 million in additional
financing, including commitments from TPG Capital and Republic
Airways Holdings, an Indianapolis-based airline holding company.

Timothy E. Hoeksema, Midwest Airlines chairman and chief executive
officer, said $40 million of the additional financing has already
been funded, with an additional $20 million committed to be funded
upon completion of certain milestones in the airline's voluntary
restructuring plan.  Midwest's restructuring has focused on a
strategy to serve its core business markets, cost reductions
necessary to address high jet fuel prices and a soft economy, and
revenue enhancement actions.

"This commitment of additional financing provides us the best
opportunity to preserve what our customers and communities have
always valued from our airline, while positioning us for a return
to sustained profitability and future growth," Hoeksema said.  He
added that under the agreement, Northwest Airlines will continue
its codeshare and frequent flyer programs with Midwest.

As part of the financing agreement, Republic has entered into an
airline services agreement with Midwest to operate 12 Embraer 170
jets under the Midwest Connect brand.  Republic will operate the
76-seat Embraer 170s until Midwest can transition the fleet under
its own FAA operating certificate. The new Embraer 170 service
will be introduced into Midwest Connect's schedule throughout the
fall, beginning October 1.

Additionally, Midwest said that it had reached an agreement in
principle with Boeing Capital Corporation on renegotiated leases
for its fleet of Boeing 717s.  Under the terms of the agreement,
Midwest will continue to fly nine of the original 25 Boeing 717s
it had under lease for its mainline fleet, returning 16 to Boeing
this fall.

"Operating a more fuel-efficient, flexible mix of aircraft makes
good economic sense in this new energy environment for the airline
industry," Hoeksema said.  "We have had to make difficult
decisions as part this restructuring that have resulted in change
for our airline.  But our strategy of offering nonstop service to
key business markets and giving our customers what they have
always valued about the Midwest brand -- what we were built on --
will not change."

Revenue enhancement actions that are part of the restructuring
include the introduction of Midwest Class seating on the airline's
Boeing 717 fleet, which was announced last week, as well as a
$15 fee for first checked bag and an increase in the second
checked bag fee from $20 to $25.  Those fees will apply to
tickets purchased on or after Thursday, September 4, 2008 for
travel October 21 and beyond.  Active members of the U.S.
military and Midwest Miles Executive members are exempt from the
fees.  Wheelchairs, walkers, strollers, child car seats and other
mobility-assistive devices are also excluded.

The airline said it plans to continue negotiating with the unions
representing its pilots and flight attendants on concessions
necessary to align its labor costs to the marketplace, in order to
meet one of the final goals of its restructuring plan.  It also
said that the airline services agreement with Republic would
result in additional furloughs for Midwest pilots, flight
attendants and maintenance staff until Midwest can operate the
Embraer 170 fleet on its own FAA operating certificate.  The
airline said it expected this process, which includes training for
its flight crews and maintenance staff, would take eight months to
a year.

"We recognize the difficulty this presents to our flight crews and
maintenance staff, who will experience additional temporary
furloughs," Hoeksema said.  "We informed union leadership of our
plan and advised them that this was the best option to keep our
airline viable and that in the best interests of our employees,
customers and communities, we need them to come to the table on
cost reductions so we can obtain certification and bring the jobs
back to Midwest."

Seabury Group LLC is advising Midwest Airlines on its
restructuring plan and advised the airline on securing and
structuring these financial commitments, as well as on
restructuring the Boeing Capital Corporation agreement.

                        About Midwest Air

Oak Creek, Wisconsin-based Midwest Air Group Inc. --
http://www.midwestairlines.com/-- is a holding company of Midwest       
Airlines, Inc.  Midwest Airlines operates a passenger jet airline
that serves destinations throughout the United States from
Milwaukee, Wisconsin and Kansas City, Missouri.  Skyway Airlines,
Inc., dba Midwest Connect, is a wholly owned subsidiary of Midwest
Airlines and serves as the regional airline for the company.  
Midwest Airlines and Midwest Connect constitute the company's
segments.  It has three principal product offerings: Midwest
Airlines Signature Service, Midwest Airlines Saver Service and
Midwest Connect regional service.  As of Dec. 31, 2006, Midwest
Airlines Signature Service operated in 20 cities in the United
States, and Midwest Airlines Saver Service operated in 10 cities.  
Midwest Connect builds feeder traffic and provides regional
scheduled passenger service to cities primarily in the Midwest.  
Its subsidiaries provide aircraft charter services, transport air
freight and mail.  The company has a total of more than 3,000
workers.

As of Sept. 30, 2007, Midwest Air Group listed total assets of
$395,615,000, total liabilities of $331,810,000, and total
stockholders' equity of $63,805,000.


MORTGAGES LTD: Judge to Approve Plan Giving $2.8MM to Developer
---------------------------------------------------------------
The Hon. Sarah Sharer Curley of the U.S. Bankruptcy Court for the
District of Arizon plans to approve Mortgages Ltd.'s request to
provide $2.8 million to the developer of Tempe's Centerpoint high-
rise condos, Andrew Johnson of The Arizona Republic, reports.

The decision will permit the developer to resume construction work
on the partially complete towers, which was stalled due to  
funding shortfalls.

According to the report, Mortgages Ltd. also has plans to lend up
to $77 million more to Centerpoint developer Avenue Communities
LLC.  Those plans, which are still being worked out with Mortgages
Ltd.'s investors and creditors, are subject to bankruptcy-court
approval.  

Tempe-based Avenue Communities earlier accused Mortgages Ltd. of
failing to fund the entirety of about $190 million in loans the
two parties agreed to between March 2007 and March 2008.  At a
hearing on the issue Tuesday afternoon, Mortgages Ltd. attorney
Carolyn Johnsen said the lender and attorneys for stakeholders in
the project had come to a tentative agreement.

The agreement allows Mortgages Ltd. to borrow an initial
$2.8 million from lending firm Stratera Portfolio Advisors LLC.
Mortgages Ltd. will then lend that money to Avenue Communities
through one of the two existing loans.

The company is borrowing the money from Stratera at an interest
rate of 12.5 percent. It is lending the money to the Centerpoint
developer at 18 percent.

Judge Randolph Haines, who is presiding over Mortgages Ltd.'s
bankruptcy, said he would sign the order outlining the
$2.8 million Stratera deal once it is filed with the U.S.
Bankruptcy Court.

                        About Mortgages Ltd.

Phoenix, Arizona-based Mortgages Ltd. -- http://www.mtgltd.com/  
-- originates, invests in, sells and services its own short-term
real-estate secured loans on properties within the state of
Arizona in the US.  It underwrites loans for commercial,
industrial and residential properties for acquisition,
entitlement, development, construction and investment.

Mortgages Ltd. was the subject of an involuntary chapter 7
petition dated June 20, 2008, filed by KGM Builders Inc. -- a
contractor for Grace Communities, a borrower of the company --
before the U.S. Bankruptcy Court for the District of Arizona.  
Central & Monroe LLC and Osborn III Partners LLC, divisions of
Grace Communities, sought the appointment of an interim trustee
for Mortgages Ltd. in the chapter 7 proceeding.

Mortgages Ltd. is also facing lawsuits filed by Grace Communities
and Rightpath Limited Development Group for its alleged failure to
fully fund loans.  Mortgages Ltd. denied the charges.  It has
filed a motion to dismiss the Rightpath suit.

The Debtor's case was converted to a chapter 11 proceeding on
June 24, 2008 (Bankr. D. Ariz. Case No. 08-07465).  Judge Sarah
Sharer Curley presides over the case.  Carolyn Johnsen, Esq., and
Bradley Stevens, Esq., at Jennings, Strouss & Salmon P.L.C.,
replaced Todd A. Burgess, Esq., at Greenberg Traurig LLP, as
counsel to the Debtor.  As of Dec. 31, 2007, the Debtor had total
assets of $358,416,681 and total debts of $350,169,423.


NATIONSLINK FUNDING: Fitch Affirms 'BB' Rating on $6.6MM Certs.
---------------------------------------------------------------
Fitch Ratings affirmed NationsLink Funding Corporation's
commercial mortgage pass-through certificates, series 1999-SL, as:

  -- $426,039 class C at 'AAA';
  -- $14.3 million class D at 'AAA';
  -- $7.7 million class E at 'AAA';
  -- $17.6 million class F at 'BB+';
  -- $6.6 million class G at 'BB'.

Fitch does not rate the notional $59.7 million class X.  Classes
A-1, A-2, A-3, A-4, A-5, A-6, A-IV and B have paid in full.

Although credit enhancement has increased since Fitch's last
rating action, increasing concentrations, upcoming maturities, and
limited financial reporting warrant affirmations.  As of the
August 2008 distribution date, the pool's collateral balance has
been reduced 96%, to $46.8 million from $1.18 billion at issuance.  
Although, the transaction has paid down significantly, the pool
still remains diverse by property type with 256 loans of the
original 2,755 remaining.

The transaction's structure has reverted to standard sequential
pay.  The deal includes an overcollateralization feature which
creates a first loss piece that absorbs any losses that otherwise
would result in principal loss to the trust.  The current OC
amount is equal to $13 million (22% of the pool).  To date, the OC
structure of the pool has prevented any principal losses to the
trust.

The transaction continues to have stable performance with a
history of low delinquencies.  25% of the transaction is expected
to mature in 2008.  The weighted average mortgage coupon for the
pool is 8.23%.  There is currently one (0.3%) loan in special
servicing due to a maturity default.  The loan is expected to be
paid in full.


NCP LLC: Case Summary and Largest Unsecured Creditor
----------------------------------------------------
Debtor: NCP, LLC
        c/o Southwest Guaranty Partners, LLC
        1313 Campbell Road., Suite D
        Houston, TX 77055

Bankruptcy Case No.: 08-12992

Type of Business:  The Debtor is a single asset real estate as
                   defined in Section 101(51B) of the U.S.
                   Bankruptcy Code.

Chapter 11 Petition Date: September 3, 2008

Court: Northern District of Indiana (Fort Wayne Division)

Debtor's Counsel: Mark Werling, Esq.
                  Baker & Daniels
                  111 E. Wayne Street, Suite 800
                  Fort Wayne, IN 46802
                  Tel: (260) 460-1644
                  Fax: (260)460-1700
                  Email: oliana.nansen@bakerd.com

Estimated Assets: $1 million to $10 million

Estimated Debts: $1 million to $10 million

Debtor's Largest Unsecured Creditors:

   Entity                         Nature of Claim     Claim Amount
   ------                         ---------------     ------------
Emerald Isle Lending Company          Loan            $1,304,976
4155 E. Jewell Avenue, Suite 906
Denver, CO 80222


NELLIS BOULEVARD: Case Summary & Four Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: Nellis Boulevard, LLC
        2261 Market Street, Suite 314
        San Francisco, CA 94114

Bankruptcy Case No.: 08-19815

Type of Business: The Debtor is a single asset real estate as
                  defined in Section 101(51B) of the U.S.
                  Bankruptcy Code.

Chapter 11 Petition Date: August 29, 2008

Court: District of Nevada

Judge: Mike K. Nakagawa

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

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

A copy of the Debtor's petition is available for free at:

           http://bankrupt.com/misc/cab08-19815.pdf.doc


NETBANK INC: U.S. Trustee Objects to Liquidation Plan
-----------------------------------------------------
Bankruptcy Law360 reports that Donald F. Walton, the U.S. Trustee  
for Region 21, has objected to the plan of liquidation for NetBank
Inc.

According to Bankruptcy Law360, Mr. Walton told the U.S.
Bankruptcy Court for the Middle District of Florida that a
provision in NetBank's liquidation plan would exculpate non-
debtors.

The Bankruptcy Court will convene a hearing to consider
confirmation of the NetBank's liquidation plan September 10, 2008,
at 9:30 a.m.  The deadline to submit plan votes expired August 29.

In mid-August, Judge Jerry A. Funk clarified that the disclosure
statement explaining the Debtor's plan as well as the voting and
solicitation procedures need not be sent to any interest holders
to whom solicitation package has not already been sent by the
Debtor's claims agent, Kurtzman Carson Consultants, LLC, or by any
nominee of a beneficial holder of the Debtor's stock.  The Court
also held that the provisions pursuant to the solicitation
procedures order relating to the balloting by Interest Holders
should be disregard.

                    July 31 Plan Modifications

On July 31, 2008, pursuant to Section 1127 of the Bankruptcy Code,
NetBank submitted modifications to its Amended Liquidating Plan of
Reorganization.  The Amended Plan provides that the holders of
equity interests in the Debtor in Class VIII are deemed to have
rejected the Plan and will not receive a ballot because the
likelihood of a distribution to this class is remote.

The Debtor told the Court the amendment has no effect on any
creditor or interest holder other than the Interest Holders in
Class VIII.  According to the Debtor, the amendment does not alter
the treatment of the Interest Holders in Class VIII, only their
voting rights.

The Debtor explained that at the time of the filing of the Amended
Plan, it only had knowledge of that there were approximately 350
holders of record of the Debtor's common stock. Subsequently, the
Debtor has learned that there are more than 11,000 Interests
Holders.  Because the likelihood of a distribution to Interest
Holders is remote, the expense with regard to solicitation of
acceptances of the Amended Plan from Interest Holders -- which
acceptance is irrelevant to confirmation under Section 1129 -- is
cost prohibitive.  The Debtor has received an estimate that the
cost to the estate to provide solicitation packages to all
Interest Holders would be in excess of $250,000.

As reported by the Troubled Company Reporter, Judge Funk approved
the disclosure statement on July 14.

                           About NetBank

Headquartered in Jacksonville, Florida, NetBank, Inc. --
http://www.netbank.com/-- is a financial holding company of
Netbank, the United States' oldest Internet bank serving retail
and business customers in all 50 states.  NetBank, Inc. does
retail banking, mortgage banking, business finance, and provides
ATM and merchant processing services.

The company filed for chapter 11 protection on Sept. 28, 2007
(Bankr. M.D. Fla. Case No. 07-04295).  Alan M. Weiss, Esq., at
Holland & Knight LLP, represents the Debtor.  The U.S. Trustee for
Region 21 appointed six creditors to serve on an Official
Committee of Unsecured Creditors of the Debtor's case.  Rogers
Towers, Esq. at Kilpatrick Stockton LLP, represents the Committee
in this case.  Rogers Towers P.A. serves as co-counsel to the
Committee.  As of Sept. 25, 2007, the Debtor listed total
assets of $87,213,942 and total debts of $42,245,857.


NEW CAP: Court Grants Recognition to Scheme of Arrangement in U.S.
-----------------------------------------------------------------
In accordance with Section 304 of the Bankruptcy Code, the U.S.
Bankruptcy Court for the Southern District of New York, upon the
request of John Gibbons, the duly appointed liquidator and scheme
administrator of New Cap Reinsurance Corporation Limited, has
granted recognition and given effect in the United States to the
scheme of arrangement between the company and its creditors
pursuant to section 411 of the Australian Corporations Act 2001
and a permanent injunction, dated July 25, 2008.  

Copies of the order, which is dated Aug. 12, 2008, the Scheme and
the motion, are available upon request to the petitioner's United
States counsel, Chadbourne & Parke LLP:

          Chadbourne & Parke LLP
          Attn: Howard Seife, Esq.
                Francisco Vazquez, Esq.
          30 Rockefeller Plaza
          New York, N.Y. 10012
          Tel: (212) 408-5100
         
New Cap Reinsurance Corp. (Bermuda) Ltd. and its New Cap
Reinsurance Corp. Ltd. subsidiary filed chapter 11 petitions in
the U.S. Bankruptcy Court in Manhattan on April 27, 1999, with
the parent estimating both assets and liabilities at over
$100 million.  The parent company, based in Hamilton, Bermuda,
is engaged in the business of insurance and reinsurance whereas
the Sydney, Australia-based subsidiary, founded in 1997, writes
worldwide casualty, catastrophe, marine, occupational, and
personal insurance policies.

The Supreme Court of Bermuda and the High Court of Justice of
England and Wales sanctioned on Feb. 23, 2006, a Scheme of
Arrangement between New Cap Reinsurance Corporation (Bermuda)
Limited, and the scheme creditors of the company.

Copies of the orders sanctioning the Scheme were delivered to
the registrars of companies in Bermuda and England on the same
day.  The Scheme became effective in both Bermuda and England on
that date.


NORTHAMPTON GENERATING: S&P Cuts Rating on $153 Mil. Bonds to 'B'
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on
Northampton Generating Co. L.P.'s $153 million series A resource
recovery revenue bonds to 'B' from 'B+' and simultaneously placed
the rating on CreditWatch with negative implications.

The outlook for the project had been negative, reflecting our
expectation of continuing financial vulnerability and worsening
debt coverage.  Recent disclosure by the project indicates that
coverage will be lower than expected, and that from 2009 the
project may not be in a position to fully repay the scheduled
interest and principal payments for the series C subordinated
bonds (unrated).  Moreover, the project has disclosed that it may
need to draw on the senior debt service reserve, currently funded
at $10.1 million, to support principal payments of the series A
senior bonds as early as 2009.

The bonds were issued by the Pennsylvania Economic Development
Financing Authority on behalf of the project, which is a 112 MW
(net) anthracite waste coal-fired power plant in Northampton, Pa.
Electricity is provided to Metropolitan Edison Co. under a 25-year
energy-only power purchase agreement.

Standard & Poor's is in discussion with the project's management
with the goal of resolving the CreditWatch in the third quarter of
2008.


PFP HOLDINGS: Agrees to Appointment of Chapter 11 Trustee
---------------------------------------------------------
PFP Holdings Inc. consented to the appointment of a chapter 11
trustee, William Rochelle of Bloomberg News quotes documents filed
with the U.S. Bankruptcy Court for the District of Arizona.

Mr. Rochelle reports that the Official Committee of Unsecured
Creditors has pressed for the chapter 11 trustee appointment
saying that the Debtor has very few remaining assets and no longer
builds homes.  The Committee will disband in 30 days upon the
chapter 11 trustee's takeover, Mr. Rochelle relates.

PFP Holdings Inc., is a homebuilder based in Phoenix, Arizona.  
The company does business under names including Trend Homes and
Regency.  Papers filed in Court indicate that the Debtor generated
$309 million in revenue during 2007 while delivering almost 1,100
homes.

PFP filed for Chapter 11 bankruptcy protection on Jan. 31, 2008,
before the U.S. Bankruptcy Court for the District of Arizona (Case
No. 08-00899).  Robert J. Miller, Esq., at Bryan Cave, L.L.P.,
represents the Debtor.  An Official Committee of Unsecured
Creditors has been formed in this case.  Upon its bankruptcy
filing, it listed $50 million to $100 million in estimated assets
and debts.



POWERMATE CORP: Committee Sues Sun Capital for Fraudulent Transfer
------------------------------------------------------------------
The Official Committee of Unsecured Creditors of Powermate Corp.
sued Sun Capital Partners alleging fraudulent transfer and breach
of fiduciary duty, William Rochelle of Bloomberg News relates.

The Committee alleged that Sun Capital caused Powermate to
distribute $20 million dividend, according to the report.  On
Aug. 29, 2008, the Committee related to the U.S. Bankruptcy Court
in Delaware that the Debtor used $15 million in secured loan from
a Sun Capital affiliate to pay the dividend, Mr. Rochelle notes.

The Committee also asserted that Sun Capital made "low margin"
sales to Home Depot Inc. and Lowe's Cos. in order to sell
Powermate, Mr. Rochelle notes.  That process drained away working
capital, based on the report.  As a result, Powermate made another
$10 million loan to address its liquidity problems, Mr. Rochelle
adds.  

The loans from Sun Capital must either be "recharacterized as
equity" or "equitably subordinated" to other loans, the Committee
pressed, Mr. Rochelle reports.  The Committee demands recovery of
the dividend and knock out Sun Capital's secured liens.  According
to the Committee, as of the bankruptcy filing, the Debtor owes Sun
Capital $28 million and suppliers $45 million.

Mr. Rochelle notes that six companies controlled by Sun Capital
filed for chapter 11 protection this year.

                          About Powermate

Headquartered in Aurora, Illinois, Powermate Corp. --
http://www.powermate.com/-- manufactures portable and home
standby generators, air compressors, and pressure washers.
Powermate Holding Corp. is the parent of Powermate Corp.  In
turn, Powermate Corp. owns 100% of Powermate International Inc.
Powermate Corp. operates the companys assets located in the
United States. Powermate International has sales employees in
Hong Kong and the Philippines.  Powermate Holding has no
employees or operations.  Sun Capital Partners bought 95% of
Powermate in 2004.

Powermate Holding has two other non-debtor subsidiaries,
Powermate Canadian Corp., located in Canada and Powermate S. de
R.L. de C.V., which is domiciled in Mexico.

The three companies filed for chapter 11 protection on March 17,
2008 (Bankr. D. Del. Lead Case No.08-10498).  Kenneth J. Enos,
Esq.. and Michael R. Nestor, Esq., at Young, Conaway, Stargatt &
Taylor, represent the Debtors.  The Official Committee of
Unsecured Creditors, which has seven creditor members, is
represented by Monika J. Machen, Esq., at Sonnenschein Nath
Rosenthal LLP.

On May 23, 2008, the Debtors' summary of schedules posted total
assets of $60,139,442 and total debts of $85,700,759.


PRESBYTERIAN VILLAGES: Fitch Holds 'BB+' Rating on $32.38MM Bonds
-----------------------------------------------------------------
Fitch Ratings affirmed the 'BB+' rating on approximately
$32.38 million Michigan State Hospital Finance Authority revenue
and refunding bonds series 2005 (Presbyterian Villages of Michigan
Obligated Group).  The Rating Outlook is revised to Stable from
Negative.

The rating affirmation at 'BB+' reflects Presbyterian Villages of
Michigan's adequate debt service coverage, light but consistent
liquidity and solid occupancy across all levels of care.  
Historical coverage of maximum annual debt service has improved to
1.6 times in fiscal 2007 from 1.5x and 1.4x in fiscal 2006 and
2005, respectively.  Fitch views PVM's historical debt service
coverage as adequate reflecting the corporation's rental contract
type and the moderate income level of its market.  

Unrestricted cash and investments totaled $11.2 million at June
30, 2008 which translates to 126 days cash on hand and 35% cash to
debt.  Although PVM's DCOH ratio has weakened from 143 at Dec. 31,
2006, the level of unrestricted cash at June 30, 2008 is roughly
$600,000 lower as compared to PVM's level of restricted cash and
investments at Dec. 31, 2006.  Aggregate occupancy has been stable
since fiscal 2006 across all levels of care.  Occupancy in the
independent living units and assisted living units has ranged
between 85%-90% while occupancy in the skilled nursing facilities
has been stable at 95%.

The Outlook revision to Stable from Negative reflects management's
success at maintaining occupancy and controlling expense growth in
the difficult southeast Michigan operating environment.  
Historically, PVM has depended on investment income and
philanthropic contributions to supplement operating losses and
achieve debt service coverage.  Since fiscal 2004 investment
income and contributions have averaged roughly $3.2 million
annually.  Fitch expects that any material decrease in investment
income and/or contributions will be recouped through tighter
expense control and improved operations to maintain debt service
coverage in line with historical performance.

Headquartered in Southfield, Michigan, the PVM Obligated Group
consists of three rental continuing care retirement communities
located in Redford, Westland and Chesterfield Township, Michigan.
Currently, the Obligated Group's three campuses total 328
independent rental apartments (of which 313 are operational), 269
assisted living units, and 178 skilled nursing beds.  In addition,
PVM owns or manages approximately 1,200 independent living and 20
assisted living units through non-obligated entities.  PVM has
covenanted to provide annual audited financial statements and
quarterly unaudited financials to the NRMSIRs. Fitch notes that
PVM's disclosure practices have been excellent.


PROGRESSIVE GAMING: To Implement Reverse Stock Split by Sept. 15
----------------------------------------------------------------
Progressive Gaming International Corporation plans to effect a
one-for-eight reverse split of the authorized, issued and
outstanding shares of the company's common stock after the close
of trading on Sept. 15, 2008.  The Company is implementing the
reverse stock split to maintain compliance with regulatory
agencies, its recent financing transactions and NASDAQ listing
requirements.  Following the reverse stock split the company will
have approximately 10.8 million shares issued and outstanding,
inclusive of 2.1 million shares issuable pursuant to the
convertible note debenture with International Game Technology and
approximately 0.8 million shares issuable under option and warrant
agreements.  The preceding calculation does not include any
contingent warrants or shares that may be issuable to Private
Equity Management and IGT.  Following the reverse stock split, the
number of total authorized shares of the company's common stock
will be reduced to 12.5 million shares.

Separately, the company announced that, since Aug. 18, 2008, it
has repurchased 139,300 shares of its common stock for total
consideration of approximately $100,000 in open market
transactions pursuant to the share repurchase plan initially
authorized in 2002.  Prior to Aug. 18, 2008, the Company had
approximately $1.5 million remaining under this share repurchase
plan.  Additional purchases may be made from time to time, as and
when permissible under applicable securities law, in the open
market at prevailing market prices, through 10b5-1 programs or in
privately negotiated transactions.  The timing and actual number
of shares to be purchased will depend on market conditions and
other factors.  Purchases may be discontinued at any time.

                     About Progressive Gaming

Headquartered in Las Vegas, Progressive Gaming International
Corporation (Nasdaq: PGIC) -- http://www.progressivegaming.net/--    
is a supplier of integrated casino and jackpot management system
solutions for the gaming industry worldwide.  Products include
multiple forms of regulated wagering solutions in wired, wireless
and mobile formats.

                        Going Concern Doubt

Ernst & Young, in Las Vegas, expressed substantial doubt about
Progressive Gaming International Corp.'s ability to continue as a
going concern after auditing the company's consolidated financial
statements for the year ended Dec. 31, 2007.  

The auditing firm reported that the company has experienced
recurring operating losses, has an accumulated deficit and
negative working capital.  In addition, the company's senior
secured notes are due in August 2008 and are classified as current
as of Dec. 31, 2007, and the company currently does not have
sufficient cash to completely redeem the outstanding senior
secured notes.

The company said it intends to refinance its $30,000,000 Senior
Secured Notes through a strategic technology investment together
with a bank facility.  The company said that these transactions
are expected to be completed on or before July 31, 2008.


RED SHIELD: Court Approves Additional $500,000 Loan for Payroll
---------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Maine approved an
additional $500,000 loan to Red Shield Environmental, LLC, and RSE
Pulp and Chemical, LLC, in order to allow the two companies to
meet its payroll and benefits until the end of the month, Scott
Sassone of WCSH6.com reports.

Red Shield plans to secure a $13.6 million loan from Woodside
Capital of Massachusetts to restructure the company.  Woodside
Capital is asking the Finance Authority of Maine to guarantee
$4.6 million of that loan.  Red Shield's attorney also asked for
permission to entertain offers to sell the mill.  

"We have not received any offers yet," Attorney Robert Keach said.

Keach said Whitebox Advisors of Minnesota and one other company
have expressed interest in purchasing the mill.  Mr. Keach would
not identify the name of the other company interested in
purchasing the mill.

According to the news report, Red Shield owner Ed Paslawski has
said that the mill will only be sold if the company cannot reach a
deal with a new investor.

                         About Red Shield

Headquartered in Old Town, Maine, Red Shield Environmental, LLC --
http://www.redshieldenv.com/-- provides renewable energy for on-  
site consumption.  The company and its affiliate, RSE Pulp &
Chemical, LLC, filed for chapter 11 protection on June 27, 2008
(Bankr. D. Maine Case Nos. 08-10633 and 08-10634).  Robert J.
Keach, Esq., at Bernstein, Shur, Sawyer & Nelson, represents the
Debtors in their restructuring efforts.  When the Debtors filed
for protection against their creditors, they listed assets of
between $50 million and $100 million, and debts of between
$1 million and $10 million.


REMOTEMDX INC: June 30 Balance Sheet Upside-Down by $754,521
------------------------------------------------------------
RemoteMDX Inc.'s consolidated balance sheet at June 30, 2008,
showed $14,359,033 in total assets, $11,353,769 in total
liabilities, and $3,759,785 in minority interest, resulting in a
$754,521 stockholders' deficit.

At June 30, 2008, the company's consolidated balance sheet also
showed strained liquidity with $6,170,519 in total current assets
available to pay $10,772,523 in total current liabilities.

The company reported a net loss of $17,502,818 on total revenues
of $3,610,378 for the third quarter ended June 30, 2008, compared
with a net loss of $5,274,259 on total revenues of $3,152,556 for
the same period ended June 30, 2007.

The increase in revenues resulted primarily from the monitoring of
offender tracking devices and providing probation services to
individuals on parole.

During the three months ended June 30, 2008, selling, general and
administrative expenses were $16,814,431 compared to $3,947,567
during the three months ended June 30, 2007.  The net increase of
$12,866,864 mainly reflects the increase in consulting costs of
$11,274,038, which is directly related to stock and warrants
issued for services rendered to the company and severance given to
an officer of the company for his service as president.

During the three months ended June 30, 2008, interest expense
totaled $389,838 compared to $279,418 in the three months ended
June 30, 2007.  

Full-text copies of the company's consolidated financial
statements for the quarter ended June 30, 2008, are available for
free at http://researcharchives.com/t/s?319f

                 Liquidity and Capital Resources

The company is presently unable to finance its business solely
from cash flows from operating activities.  During the nine months
ended June 30, 2008, the company financed its business primarily
from the sale of common stock for proceeds of $2,000,000, sale of
equity securities by the company's subsidiary, Volu-Sol for
proceeds of $4,598,333 and the exercise of warrants for the
purchase of common stock of the company for net proceeds of
$2,658,380.

If the company is unable to increase cash flows from operating
activities or obtain additional financing, it will be unable to
continue the development of its business and may have to cease
operations.

                         About RemoteMDx

Headquartered in Sandy, Utah, RemoteMDx Inc. (OTC BB: RMDX.OB) --
http://www.remotemdx.com/-- operates in two business segments.   
The Volu-Sol segment is engaged in the business of manufacturing
and marketing medical diagnostic stains, solutions and related
equipment to hospitals and medical testing labs.  The electronic
monitoring segment is engaged in the business of developing,
distributing and monitoring offender tracking devices.  


RIDGEVIEW 8888: Case Summary and Largest Unsecured Creditor
-----------------------------------------------------------
Debtor: Ridgeview 8888 LLC
        6130 Shiloh Road
        Alpharetta, GA 30005

Bankruptcy Case No.: 08-76847

Type of Business: The Debtor is a single asset real estate as
                  defined in Section 101(51B) of the U.S.
                  Bankruptcy Code.

Chapter 11 Petition Date: August 29, 2008

Court: Northern District of Georgia (Atlanta)

Judge: Margaret Murphy

Debtor's Counsel: Paul Reece Marr, Esq.
                  Paul Reece Marr, P.C.
                  300 Galleria Parkway, N.W., Suite 960
                  Atlanta, GA 30339
                  Tel: (770) 984-2255
                  Email: pmarr@mindspring.com

Estimated Assets: $1 million to $10 million

Estimated Debts:  $1 million to $10 million

Debtor's Largest Unsecured Creditor:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
Forsyth County Tax             property taxes        $12,000
Commissioner
1092 Tribble Gap Road
Cumming, GA 30040


RIVER ROCK: Commences Cash Tender Offer for 9-3/4% Senior Notes
---------------------------------------------------------------
River Rock Entertainment Authority has commenced a tender offer to
purchase for cash up to $30 million principal amount of its
outstanding 9-3/4% Senior Notes due 2011, upon the terms and
subject to the conditions set forth in an Offer to Purchase dated
Aug. 27, 2008.

The Offer to Purchase will expire on Sept. 24, 2008, unless
extended or earlier terminated.

The total consideration for each $1,000 principal amount of Notes
validly tendered and not withdrawn pursuant to the Offer to
Purchase will be $1,051.25, which amount includes an early tender
premium of $30.00 per $1,000 principal amount of Notes.  The Total
Consideration minus the Early Tender Premium will be $1,021.25 per
$1,000 principal amount of Notes.  The Total Consideration will be
payable in respect of Notes validly tendered and not withdrawn on
or prior to 5:00 p.m., New York City time, on Sept. 10, 2008.
Holders of Notes who validly tender their Notes after the Early
Tender Date but on or prior to the Expiration Date will be
eligible to receive only the Tender Offer Consideration.

The date of payment for tendered Notes is expected to occur
promptly following the Expiration Date, provided all conditions to
the Offer to Purchase have been satisfied or waived.  The
scheduled Settlement Date is Sept. 25, 2008, unless extended by
the company.  Holders whose Notes are accepted for payment in the
Offer to Purchase will receive accrued and unpaid interest in
respect of such purchased Notes from the last interest payment
date up to, but not including, the Settlement Date.

If the principal amount of the Notes tendered pursuant to the
Offer to Purchase is greater than $30 million, the Authority will
accept Notes for purchase and pay Holders thereof on a pro rata
basis.  There is no condition that any minimum amount of Notes
must be tendered in the Offer to Purchase for the Authority to
accept the Notes for payment.  Tenders of Notes may be withdrawn
at any time on or prior to Sept. 10, 2008.  Tendered Notes may not
be subsequently withdrawn, except if the Offer to Purchase is
terminated without any Notes being purchased.

The Authority's obligation to accept and pay for tendered Notes is
conditioned upon the satisfaction or waiver of various conditions
described in the Offer to Purchase, which may be waived by the
Authority at any time prior to the Settlement Date.  The Authority
also reserve the right to terminate, withdraw or amend the Offer
to Purchase at any time and from time to time.

The Offer to Purchase is made only by the Offer to Purchase and
the Letter of Transmittal.

The Authority has retained Merrill Lynch & Co. to serve as the
Dealer Manager for the Offer to Purchase. Questions regarding the
Offer to Purchase may be directed to Merrill Lynch & Co at (888)
654-8637.  Global Bondholder Services Corporation serves as both
Depositary and Information Agent for the Offer.  Requests for the
Offer to Purchase, the Letter of Transmittal and related documents
may be directed to Global Bondholder Services Corporation by
telephone at (866) 794-2200.

                   Funding for Tribe's Projects

The Offer to Purchase is part of several transactions designed to
provide funds for all or a portion of the costs of certain capital
improvements projects on the Tribe's trust and adjacent lands that
serve essential governmental purposes, including, without
limitation, various road, drainage and landscaping infrastructure
projects, design and engineering services, land purchase and the
repurchase, through the Offer to Purchase, of outstanding Notes
that were previously issued to finance such projects.  The
majority of the components of the projects are required to make
the current operations more efficient and improve services to the
Tribe's reservation and its gaming and entertainment facility.  
The Authority expects that these transactions will enable us to
complete a portion of the preparatory site work necessary for the
Authority's proposed resort development project, including a new
and expanded "Tuscan-themed" casino and hotel with luxury resort
amenities.

The total estimated cost of the projects (excluding debt service)
is approximately $84.8 million, which the Authority and the Tribe
expect to finance from cash on hand, a new term loan and other
indebtedness.  The Offer to Purchase will enable the Authority to
reduce outstanding senior indebtedness and give it additional
flexibility to finance the projects.  Concurrently with the
consummation of the Offer to Purchase, the Authority intends to
borrow
$20.0 million pursuant to a term loan agreement with an affiliate
of the Dealer Manager, and the Authority will contribute the net
proceeds of the Term Loan to the Tribe.  The Term Loan will be
unsecured.  Amounts outstanding under the Term Loan are expected
to bear interest at a rate of 9.75% per annum and mature on Nov.
1, 2011.  The Term Loan Agreement would not contain any financial
maintenance covenants but would include restrictions on additional
indebtedness and other covenants and events of default customarily
included in loan agreements for similar transactions.  The Term
Loan Agreement would give the Authority the ability to incur up to
an additional $5.0 million, on the same terms as the initial
$20 million, upon satisfaction of certain conditions, including
that the additional borrowing be permitted indebtedness under the
Indenture governing the Notes.

                        Term Loan Exchange

Other proposed terms would include that all or part of the Term
Loan may be exchanged, at the lender's election, for additional
Notes to be issued under the Indenture.  For every $1,000
principal amount of Term Loan exchanged, the lender would be
entitled to receive new Notes, the terms of which would be
substantially identical to the outstanding Notes, in a principal
amount of $1,000 plus any applicable premium, which premium, if
any, would be computed by a formula based on an average bid price
for the Senior Notes at or about the date of exchange. The Term
Loan could be prepaid at any time without penalty.  Although the
Authority intends to consummate the Term Loan on the terms
described above, there can be no assurance that the Authority will
be successful in obtaining financing on these or other terms or
conditions.

                     Master Utilities Ordinance

In connection with these transactions on July 19, 2008, the Tribe
adopted a master utilities ordinance that provides for the
assessment against the Authority's gaming operations of certain
fees for municipal services, products or benefits rendered by the
Tribe which are reasonably necessary or desirable to the operation
of the Authority's gaming and entertainment facility.  At closing,
the Authority intends to distribute to the Tribe (i)
infrastructure assets previously financed with the proceeds of the
Notes aggregating approximately $28.7 million and (ii) an
additional amount permitted to be distributed under the Indenture
of approximately $34.7 million.  The Authority expects to pay
about $11.5 million in master utilities fees for the 2009 fiscal
year based on projections provided to the Authority from the
Tribe.  A number of factors may result in adjustments to the
projected amount, including increases or decreases in operating
expenses of the utilities and actual debt service relating to the
Tribe's indebtedness.

                         About River Rock

Headquartered in Geyserville, California, River Rock Entertainment
Authority is a governmental instrumentality of the Dry Creek
Rancheria Band of Pomo Indians, a federally recognized Indian
tribe.  River Rock Casino is a governmental development project of
the Authority.  The Casino offers Class III slot and video poker
gaming machines, house banked table games, including Blackjack,
Three card poker, Mini-baccarat and Pai Gow poker, Poker,
featuring Texas Hold' em, comprehensive food and non-alcoholic
beverage offerings, and goods for sale on tribal land located in
Geyserville, California.

The company' balance sheet as of June 30, 2008, showed total
assets of $189,838,595, total liabilities of $210,337,970, and
total fund deficit of $20,499,375.


RMBS MORTGAGE: S&P Cut Rating on 20 Class Notes to 'D'
------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on 248
classes from 31 residential mortgage-backed securities (RMBS)
transactions backed by U.S. subprime mortgage loan collateral
issued in 2006.

According to S&P, "At the same time, we removed 160 of the lowered  
ratings from CreditWatch with negative implications.  In addition,
S&P affirmed its ratings on 108 classes from the same 31 RMBS
transactions, and removed 51 of the affirmed ratings from
CreditWatch negative."

"The downgraded classes represent an original par amount of
approximately $17.8 billion, or about 4% of the par amount of U.S.
RMBS backed by first-lien subprime mortgage loans rated by
Standard & Poor's in 2006.  S&P have taken previous rating actions
on approximately $8.9 billion of the total amount of affected
securities. In addition, the classes that we affirmed represent an
original par amount of approximately $12.2 billion subprime RMBS
certificates issued in 2006."

The downgrades reflect S&P's opinion that projected credit support
for the affected classes is insufficient to maintain the previous
ratings, given its current projected losses.  As announced in "S&P
Revises Deal-Specific Projected Losses For U.S. Subprime RMBS
Issued In 2006, 2007," published Aug. 19, 2008, S&P's default
curve for U.S. subprime RMBS is a key component of S&P's loss
projection analysis of U.S. RMBS transactions, which is discussed  
in "Standard & Poor's Revised Default And Loss Curves For U.S.
Subprime RMBS," published Oct. 19, 2007.  With the recent
continued deterioration in U.S. RMBS performance, however, S&P are
adjusting its loss curve forecasting methodology to more
explicitly incorporate each transaction's current delinquency,
default, and loss trends.  Some transactions are experiencing
foreclosures and delinquencies at rates greater than S&P's initial
projections.

S&P believes that "adjusting our projected losses, which we
derived from its default curve analysis, is appropriate in cases
where the amount of current delinquencies indicates a different
timing or  level of loss."  In addition, S&P recently revised its
loss severity assumption for transactions issued in 2006 and the
first half of 2007 as described in " Standard & Poor's Revises
U.S. Subprime, Prime, And Alternative-A RMBS Loss Assumptions,"
published July 30, 2008.  S&P based "the revised assumption on its
belief that continued foreclosures, distressed sales, increased
carrying costs, and a further decline in home sales will continue
to depress prices and push loss severities higher than we
previously assumed."

"The lowered ratings reflect our assessment of credit support
under three constant prepayment rate scenarios.  The first
scenario utilizes the lower of the lifetime or 12-month CPR, while
the second utilizes a 6% CPR, which is very slow by historical
standards.  The third scenario uses a prepayment rate that is
equal to two times the lower of the lifetime or 12-month CPR," S&P
says.

S&P incorporated a third CPR scenario into its cash flow analysis  
to account for potential increases in prepayments, which may occur
from normal increases typically found in the seasoning of pools
combined with a chance that governmental proposals, if adopted,
may lead to increased CPRs.  S&P assumed a constant default rate
for each pool.  Because the analysis focused on each individual
class with varying maturities, prepayment scenarios may cause  an
individual class or the transaction itself to prepay in full
before it incurs the entire loss projection. Slower prepayment
assumptions lengthen the average life of the mortgage pool, which
increases the likelihood that total projected losses will be
realized.  The longer a class remains outstanding,  however, the
more excess spread it generates.

To assess the creditworthiness of each class, S&P reviewed the
individual delinquency and loss trends of each transaction for
changes, if any, in risk characteristics, servicing, and the
ability to withstand additional credit deterioration.  For
mortgage pools that are continuing to show increasing
delinquencies, S&P increased its cash flow stresses to account for
potential increases in monthly losses.  In order to maintain a
rating higher than 'B', a class had to absorb losses in excess of
the base-case assumption S&P assumed in its analysis.

"For example, a class may have to withstand 115% of its base-case
loss assumption in order to maintain a 'BB' rating, while a
different class may have to withstand 125% of our base-case loss
assumption to maintain a 'BBB' rating. Each class that has an
affirmed 'AAA' rating can withstand approximately 150% of its
base-case loss assumptions under its analysis, subject to
individual caps assumed on specific transactions," S&P says.

S&P determined the caps by limiting the amount of remaining
defaults to 90% of the current pool balances.

A combination of subordination, excess spread, and
overcollateralization provide credit support for the affected
transactions.  The underlying collateral for these deals consists
of fixed- and adjustable-rate U.S. subprime mortgage loans that
are secured by first and second liens on one- to four-family
residential properties.

To date, including the classes listed and actions on both publicly
and confidentially rated classes, S&P have resolved the
CreditWatch placements of the ratings on 1,023 classes from 136
U.S. RMBS subprime transactions from the 2006 and 2007 vintages.  
Currently, its ratings on 2,259 classes from 381 U.S. RMBS
subprime transactions from the 2005, 2006, and 2007 vintages are
on CreditWatch negative.

Standard & Poor's will continue to monitor the RMBS transactions
it rates and take rating actions, including CreditWatch
placements, when appropriate.

Rating Actions

ABFC 2006-OPT2 Trust
Series      2006-OPT2

Rating
Class      CUSIP         To             From
-----      -----         --             ----
A-1        00075XAA5     BBB            AAA/Watch Neg
A-2        00075XAB3     BBB            AAA/Watch Neg
A-3A       00075XAC1     AAA            AAA/Watch Neg
A-3B       00075XAD9     AAA            AAA/Watch Neg
A-3C       00075XAE7     A              AAA/Watch Neg
A-3D       00075XAF4     BBB            AAA/Watch Neg
M-1        00075XAG2     BB-            BB/Watch Neg
M-2        00075XAH0     B              B/Watch Neg
M-3        00075XAJ6     CCC            CCC
M-4        00075XAK3     CCC            CCC
M-5        00075XAL1     CCC            CCC

ACE Securities Corp. Home Equity Loan Trust, Series 2006-FM2
Series      2006-FM2

Rating
Class      CUSIP         To             From
-----      -----         --             ----
A-1        00442CAA7     B-             BBB/Watch Neg
A-2A       00442CAB5     AA             AA/Watch Neg
A-2B       00442CAC3     BBB-           AA/Watch Neg
A-2C       00442CAD1     B              AA/Watch Neg
A-2D       00442CAE9     B-             BB/Watch Neg
M-1        00442CAF6     CCC            CCC
M-2        00442CAG4     CCC            CCC
M-3        00442CAH2     CCC            CCC
M-4        00442CAJ8     CC             CCC
M-10       00442CAQ2     D              CC

Ace Securities Corp. Home Equity Loan Trust, Series 2006-OP2
Series 2006-OP2

Rating
Class      CUSIP         To             From
-----      -----         --             ----
A-1        00441YAA0     AA             AAA/Watch Neg
A-2A       00441YAB8     AAA            AAA/Watch Neg
A-2B       00441YAC6     AAA            AAA/Watch Neg
A-2C       00441YAD4     AA             AAA/Watch Neg
A-2D       00441YAE2     A              AAA/Watch Neg
M-1        00441YAF9     BBB            AA/Watch Neg
M-2        00441YAG7     B              BBB/Watch Neg
M-3        00441YAH5     CCC            BB/Watch Neg
M-4        00441YAJ1     CCC            CCC
M-5        00441YAK8     CCC            CCC
M-6        00441YAL6     CCC            CCC
M-7        00441YAM4     CCC            CCC
M-8        00441YAN2     CCC            CCC
M-9        00441YAP7     CC             CCC

Argent Securities Trust 2006-W3
Series 2006-W3

Rating
Class      CUSIP         To             From
-----      -----         --             ----
A-1        040104SN2     A-             AAA/Watch Neg
A-2B       040104SQ5     AAA            AAA/Watch Neg
A-2C       040104SR3     AA             AAA/Watch Neg
A-2D       040104SS1     A-             AAA/Watch Neg
M-1        040104ST9     B              AA/Watch Neg
M-2        040104SU6     CCC            BB/Watch Neg
M-3        040104SV4     CCC            B/Watch Neg
M-4        040104SW2     CCC            CCC
M-5        040104SX0     CC             CCC
M-6        040104SY8     CC             CCC
M-11       040104TD3     D              CC

Citigroup Mortgage Loan Trust 2006-WF1
Series 2006-WF1

Rating
Class      CUSIP         To             From
-----      -----         --             ----
A-1        17307G4E5     BB             AAA/Watch Neg
A-2B       17307G4G0     AAA            AAA/Watch Neg
A-2C       17307G4H8     AAA            AAA/Watch Neg
A-2D       17307G4J4     BB+            AAA/Watch Neg
A-2E       17307G4K1     BB             AAA/Watch Neg
A-2F       17307G4L9     BB             AAA/Watch Neg
M-1        17307G4M7     CCC            CCC
M-2        17307G4N5     CC             CCC
M-5        17307G4R6     D              CC

FFMLT Trust 2006-FF4
Series 2006-FF4

Rating
Class      CUSIP         To             From
-----      -----         --             ----
A-2        362334FS8     AAA            AAA/Watch Neg
A-3        362334FT6     AA             AAA/Watch Neg
M-1        362334FV1     BBB            AAA/Watch Neg
M-2        362334FW9     B              AA+/Watch Neg
M-3        362334FX7     CCC            BBB/Watch Neg
M-4        362334FY5     CCC            BB/Watch Neg
M-5        362334FZ2     CCC            B/Watch Neg
M-6        362334GA6     CCC            CCC
M-7        362334GB4     CC             CCC
M-8        362334GC2     CC             CCC
B-1        362334GJ7     CC             CCC
B-2        362334GK4     CC             CCC

Fremont Home Loan Trust 2006-3
Series 2006-3

Rating
Class      CUSIP         To             From
-----      -----         --             ----
I-A-1      35729MAA5     BB             A/Watch Neg
II-A-1     35729MAB3     AAA            AAA/Watch Neg
II-A-2     35729MAC1     AAA            AAA/Watch Neg
II-A-3     35729MAD9     BB             A/Watch Neg
II-A-4     35729MAE7     B              BB/Watch Neg
M-1        35729MAF4     CCC            CCC
M-2        35729MAG2     CCC            CCC
M-3        35729MAH0     CCC            CCC
M-4        35729MAJ6     CCC            CCC
M-5        35729MAK3     CC             CCC
M-6        35729MAL1     CC             CCC
M-7        35729MAM9     CC             CCC

Fremont Home Loan Trust 2006-D
Series 2006-D

Rating
Class      CUSIP         To             From
-----      -----         --             ----
1-A1       35729VAA5     A              AAA/Watch Neg
2-A1       35729VAB3     AAA            AAA/Watch Neg
2-A2       35729VAC1     AA             AAA/Watch Neg
2-A3       35729VAD9     A              AAA/Watch Neg
2-A4       35729VAE7     BBB            AAA/Watch Neg
M1         35729VAF4     B              A/Watch Neg
M2         35729VAG2     B              BB/Watch Neg
M3         35729VAH0     B-             B/Watch Neg
M4         35729VAJ6     CCC            CCC
M5         35729VAK3     CCC            CCC
M6         35729VAL1     CCC            CCC
M7         35729VAM9     CC             CCC
M8         35729VAN7     CC             CCC
M9         35729VAP2     CC             CCC

Home Equity Asset Trust 2006-7
Series 2006-7

Rating
Class      CUSIP         To             From
-----      -----         --             ----
1-A-1      43709NAA1     B              A/Watch Neg
2-A-1      43709NAB9     AAA            AAA/Watch Neg
2-A-2      43709NAC7     A              AAA/Watch Neg
2-A-3      43709NAD5     BB             AAA/Watch Neg
2-A-4      43709NAE3     B              A/Watch Neg
P          43709NAT0     AAA            AAA/Watch Neg
M-1        43709NAG8     B-             B/Watch Neg
M-2        43709NAH6     CCC            CCC
M-3        43709NAJ2     CCC            CCC
M-4        43709NAK9     CC             CCC
M-5        43709NAL7     CC             CCC
M-6        43709NAM5     CC             CCC
M-8        43709NAP8     D              CC

JPMorgan Mortgage Acquisition Corp 2006-FRE2
Series 2006-FRE2

Rating
Class      CUSIP         To             From
-----      -----         --             ----
A-1        46626LGX2     AAA            AAA/Watch Neg
A-3        46626LGZ7     AAA            AAA/Watch Neg
A-4        46626LHA1     AAA            AAA/Watch Neg
M-1        46626LHB9     AA             AA+/Watch Neg
M-2        46626LHC7     A              AA/Watch Neg
M-3        46626LHD5     B-             BBB/Watch Neg
M-4        46626LHE3     CCC            CCC
M-5        46626LHF0     CCC            CCC
M-6        46626LHG8     CCC            CCC
M-7        46626LHH6     CC             CCC
M-11       46626LHM5     D              CC

JPMorgan Mortgage Acquisition Corp. 2006-WMC1
Series 2006-WMC1

Rating
Class      CUSIP         To             From
-----      -----         --             ----
A-1        46626LJK7     AAA            AAA/Watch Neg
A-3        46626LHS2     AAA            AAA/Watch Neg
A-4        46626LHT0     AAA            AAA/Watch Neg
A-5        46626LHU7     AA             AAA/Watch Neg
M-1        46626LHV5     BB-            AA+/Watch Neg
M-2        46626LHW3     CCC            BBB/Watch Neg
M-3        46626LHX1     CCC            BB/Watch Neg
M-4        46626LHY9     CCC            CCC
M-5        46626LHZ6     CCC            CCC
M-6        46626LJA9     CC             CCC
M-7        46626LJB7     CC             CCC
M-8        46626LJC5     CC             CCC

Long Beach Mortgage Loan Trust 2006-10
Series 2006-10

Rating
Class      CUSIP         To             From
-----      -----         --             ----
I-A        54251YAA6     B              BB/Watch Neg
II-A1      54251YAB4     AAA            AAA/Watch Neg
II-A2      54251YAC2     AA             AAA/Watch Neg
II-A3      54251YAD0     B+             BBB/Watch Neg
II-A4      54251YAE8     B              BB/Watch Neg
M-1        54251YAF5     B-             B/Watch Neg
M-2        54251YAG3     CCC            CCC
M-3        54251YAH1     CCC            CCC
M-4        54251YAJ7     CCC            CCC
M-10       54251YAQ1     D              CC

Long Beach Mortgage Loan Trust 2006-3
Series 2006-3

Rating
Class      CUSIP         To             From
-----      -----         --             ----
I-A        542514UG7     A              AAA/Watch Neg
II-A2      542514UJ1     AAA            AAA/Watch Neg
II-A3      542514UK8     A              AAA/Watch Neg
II-A4      542514UL6     BBB            AAA/Watch Neg
M-1        542514UM4     B              BBB/Watch Neg
M-2        542514UN2     CCC            CCC
M-3        542514UP7     CCC            CCC
M-4        542514UQ5     CC             CCC
M-5        542514UR3     CC             CCC
M-7        542514UT9     D              CC

Long Beach Mortgage Loan Trust 2006-9
Series 2006-9

Rating
Class      CUSIP         To             From
-----      -----         --             ----
I-A        54251WAA0     B              BB/Watch Neg
II-A1      54251WAB8     AAA            AAA/Watch Neg
II-A-2     54251WAC6     AA             AAA/Watch Neg
II-A3      54251WAD4     B              BBB/Watch Neg
II-A4      54251WAE2     B              BB/Watch Neg
M-1        54251WAF9     B-             B/Watch Neg
M-2        54251WAG7     CCC            CCC
M-3        54251WAH5     CCC            CCC
M-4        54251WAJ1     CC             CCC
M-5        54251WAK8     CC             CCC
M-8        54251WAN2     D              CC
M-9        54251WAP7     D              CC

MASTR Asset Backed Secutiries Trust 2006-WMC1
Series 2006-WMC1

Rating
Class      CUSIP         To             From
-----      -----         --             ----
A2         57643LRJ7     AAA            AAA/Watch Neg
A3         57643LRK4     AAA            AAA/Watch Neg
A4         57643LRL2     A              AAA/Watch Neg
M1         57643LRM0     B              AA+/Watch Neg
M2         57643LRN8     CCC            BBB/Watch Neg
M3         57643LRP3     CCC            B/Watch Neg
M4         57643LRQ1     CCC            CCC
M5         57643LRR9     CC             CCC
M6         57643LRS7     CC             CCC
M7         57643LRT5     CC             CCC
M8         57643LRU2     D              CCC

Merrill Lynch Mortgage Investors Trust, Series 2006-MLN1
Series 2006-MLN1

Rating
Class      CUSIP         To             From
-----      -----         --             ----
A-1        59023AAA4     B+             AAA/Watch Neg
A-2A       59023AAB2     AAA            AAA/Watch Neg
A-2B       59023AAC0     AA             AAA/Watch Neg
A-2C       59023AAD8     BB-            AAA/Watch Neg
A-2D       59023AAE6     B+             AAA/Watch Neg
M-1        59023AAF3     B              BBB/Watch Neg
M-2        59023AAG1     B-             BB/Watch Neg
M-3        59023AAH9     CCC            B/Watch Neg
M-4        59023AAJ5     CCC            CCC
M-5        59023AAK2     CCC            CCC
M-6        59023AAL0     CC             CCC
B-1        59023AAM8     CC             CCC
B-4        59023AAQ9     D              CC

Morgan Stanley Capital I Inc. Trust 2006-NC2
Series 2006-NC2
Rating
Class      CUSIP         To             From
-----      -----         --             ----
A-1        617451EB1     AA             AAA/Watch Neg
A-2b       617451ED7     AAA            AAA/Watch Neg
A-2c       617451EE5     AAA            AAA/Watch Neg
A-2d       617451EF2     AA-            AAA/Watch Neg
M-1        617451EG0     BBB            AA/Watch Neg
M-2        617451EH8     B-             BBB/Watch Neg
M-3        617451EJ4     CCC            BB/Watch Neg
M-4        617451EK1     CCC            CCC
M-5        617451EL9     CCC            CCC
M-6        617451EM7     CC             CCC

NovaStar Mortgage Funding Trust, Series 2006-5
Series 2006-5

Rating
Class      CUSIP         To             From
-----      -----         --             ----
A-1A       66988YAA0     B              AAA/Watch Neg
A-2A       66988YAB8     AAA            AAA/Watch Neg
A-2B       66988YAC6     AAA            AAA/Watch Neg
A-2C       66988YAD4     BB-            AAA/Watch Neg
A-2D       66988YAE2     B              AAA/Watch Neg
M-1        66988YAF9     CCC            AA+/Watch Neg
M-2        66988YAG7     CCC            BBB/Watch Neg
M-3        66988YAH5     CCC            BB/Watch Neg
M-4        66988YAJ1     CC             B/Watch Neg
M-5        66988YAK8     CC             B/Watch Neg
M-6        66988YAL6     CC             CCC
M-7        66988YAM4     CC             CCC
M-8        66988YAN2     CC             CCC
M-9        66988YAP7     D              CCC

RAMP Series 2006-NC2 Trust
Series 2006-NC2

Rating
Class      CUSIP         To             From
-----      -----         --             ----
A-2        75156TAB6     AAA            AAA/Watch Neg
A-3        75156TAC4     AA             AAA/Watch Neg
M-1        75156TAD2     A              AA+/Watch Neg
M-2        75156TAE0     B              BBB/Watch Neg
M-3        75156TAF7     B-             BB/Watch Neg
M-4        75156TAG5     CCC            B/Watch Neg
M-5        75156TAH3     CCC            CCC
M-6        75156TAJ9     CCC            CCC
M-7        75156TAK6     CCC            CCC
M-8        75156TAL4     CC             CCC
M-9        75156TAM2     CC             CCC

RAMP Series 2006-NC3 Trust
Series 2006-NC3

Rating
Class      CUSIP         To             From
-----      -----         --             ----
A-2        76112B4M9     AAA            AAA/Watch Neg
A-3        76112B4N7     AA             AAA/Watch Neg
M-1        76112B4P2     BBB            AA+/Watch Neg
M-2        76112B4Q0     B-             BBB/Watch Neg
M-3        76112B4R8     CCC            BB/Watch Neg
M-4        76112B4S6     CCC            B/Watch Neg
M-5        76112B4T4     CCC            CCC
M-6        76112B4U1     CCC            CCC
M-7        76112B4V9     CC             CCC
M-8        76112B4W7     CC             CCC
M-9        76112B4X5     CC             CCC
M-10       76112B4Y3     CC             CCC

ResMAE Mortgage Loan Trust 2006-1
Series 2006-1

Rating
Class      CUSIP         To             From
-----      -----         --             ----
A-1A       76116RAA9     AA             AAA/Watch Neg
A-1B       76116RAB7     AA             AAA/Watch Neg
A-2A       76116RAC5     AAA            AAA/Watch Neg
A-2B       76116RAD3     AAA            AAA/Watch Neg
A-2C       76116RAE1     AA             AAA/Watch Neg
A-2D       76116RAF8     AA             AAA/Watch Neg
M-1        76116RAG6     B              AA+/Watch Neg
M-2        76116RAH4     B-             AA/Watch Neg
M-3        76116RAJ0     CCC            AA/Watch Neg
M-4        76116RAK7     CCC            A+/Watch Neg
M-5        76116RAL5     CC             BB/Watch Neg
M-6        76116RAM3     CC             B/Watch Neg
M-7        76116RAN1     CC             CCC
M-8        76116RAP6     CC             CCC
M-9        76116RAQ4     D              CCC
B          76116RAR2     D              CCC

Securitized Asset Backed Receivables LLC Trust 2006-NC3
Series 2006-NC3

Rating
Class      CUSIP         To             From
-----      -----         --             ----
A-1        81377CAM0     BB             AAA/Watch Neg
A-2A       81377CAA6     AAA            AAA/Watch Neg
A-2B       81377CAB4     BBB            AAA/Watch Neg
A-2C       81377CAC2     BB             AAA/Watch Neg
M1         81377CAD0     B              A/Watch Neg
M2         81377CAE8     B              BB/Watch Neg
M3         81377CAF5     B-             B/Watch Neg
M4         81377CAG3     CCC            CCC
M5         81377CAH1     CC             CCC
B1         81377CAJ7     CC             CCC
B2         81377CAK4     CC             CCC

Securitized Asset Backed Receivables LLC Trust 2006-WM2
Series 2006-WM2
Rating
Class      CUSIP         To             From
-----      -----         --             ----
A-1        81376GAA8     B              BB/Watch Neg
A-2A       81376GAB6     B              BB/Watch Neg
A-2B       81376GAC4     AAA            AAA/Watch Neg
A-2C       81376GAD2     B              BBB/Watch Neg
A-2D       81376GAE0     B              BB/Watch Neg
M-1        81376GAF7     CCC            B/Watch Neg
M-2        81376GAG5     CC             CCC
M-3        81376GAH3     CC             CCC
M-4        81376GAJ9     CC             CCC
M-5        81376GAK6     D              CC

SG Mortgage Securities Trust 2006-FRE2
Series 2006-FRE2

Rating
Class      CUSIP         To             From
-----      -----         --             ----
A-1        784208AA8     B              B/Watch Neg
A-2A       784208AB6     AA             AA/Watch Neg
A-2B       784208AC4     AA             AA/Watch Neg
A-2C       784208AD2     B              B/Watch Neg
A-2D       784208AE0     B-             B/Watch Neg
M-1        784208AF7     CCC            CCC
M-2        784208AG5     CCC            CCC
M-3        784208AH3     CC             CCC
M-4        784208AJ9     CC             CCC
M-5        784208AK6     CC             CCC

Soundview Home Loan Trust 2006-NLC1
Series 2006-NLC1

Rating
Class      CUSIP         To             From
-----      -----         --             ----
A-1        83611DAA6     AAA            AAA/Watch Neg
A-2        83611DAB4     AA             AAA/Watch Neg
A-3        83611DAC2     BB             A/Watch Neg
A-4        83611DAD0     B+             BBB/Watch Neg
M-1        83611DAE8     B              BB/Watch Neg
M-2        83611DAF5     B-             B/Watch Neg
M-3        83611DAG3     CCC            CCC
M-4        83611DAH1     CCC            CCC
M-8        83611DAM0     D              CC

Soundview Home Loan Trust 2006-WF1
Series 2006-WF1

Rating
Class      CUSIP         To             From
-----      -----         --             ----
A-1A       83612LAA7     AAA            AAA/Watch Neg
A-1F       83612LAB5     AAA            AAA/Watch Neg
A-2        83612LAC3     AAA            AAA/Watch Neg
A-3        83612LAD1     BBB-           AAA/Watch Neg
A-4        83612LAU3     BB-            AAA/Watch Neg
M-1        83612LAE9     B              AA+/Watch Neg
M-2        83612LAF6     B-             AA/Watch Neg
M-3        83612LAG4     CCC            AA-/Watch Neg
M-4        83612LAH2     CCC            BBB+/Watch Neg
M-5        83612LAJ8     CCC            BB/Watch Neg
M-6        83612LAK5     CC             BB/Watch Neg
M-7        83612LAL3     CC             B/Watch Neg
M-8        83612LAM1     CC             B/Watch Neg

Specialty Underwriting and Residential Finance Trust, Series 2006-
BC2
Series 2006-BC2

Rating
Class      CUSIP         To             From
-----      -----         --             ----
A-1        84751PLK3     AA             AAA/Watch Neg
A-2B       84751PLM9     AAA            AAA/Watch Neg
A-2C       84751PLN7     AAA            AAA/Watch Neg
A-2D       84751PLP2     AA             AAA/Watch Neg
M-1        84751PLQ0     A              AA+/Watch Neg
M-2        84751PLR8     B              AA/Watch Neg
M-3        84751PLS6     CCC            A/Watch Neg
M-4        84751PLT4     CCC            BB/Watch Neg
M-5        84751PLU1     CCC            B/Watch Neg
M-6        84751PLV9     CC             CCC
B-1        84751PLW7     CC             CCC
B-2        84751PLX5     D              CCC
B-3        84751PLY3     D              CCC

Structured Asset Investment Loan Trust 2006-2
Series 2006-2

Rating
Class      CUSIP         To             From
-----      -----         --             ----
A2         86358EE51     AAA            AAA/Watch Neg
A3         86358EE69     AA             AAA/Watch Neg
A4         86358EE77     BB             A/Watch Neg
M1         86358EE85     CCC            CCC
M2         86358EE93     CC             CCC
M3         86358EF27     CC             CCC

Structured Asset Investment Loan Trust 2006-4
Series 2006-4

Rating
Class      CUSIP         To             From
-----      -----         --             ----
A1         86360WAA0     B              BB/Watch Neg
A2         86360WAB8     B              BB/Watch Neg
A3         86360WAC6     AAA            AAA/Watch Neg
A4         86360WAD4     BB             AA/Watch Neg
A5         86360WAE2     B              BB/Watch Neg
M1         86360WAF9     CCC            CCC
M2         86360WAG7     CC             CCC
M3         86360WAH5     CC             CCC
M7         86360WAM4     D              CC

Structured Asset Securities Corporation Mortgage Loan Trust 2006-
BC3
Series 2006-BC3

Rating
Class      CUSIP         To             From
-----      -----         --             ----
A1         86359PAA8     BBB            A/Watch Neg
A2         86359PAB6     AAA            AAA/Watch Neg
A3         86359PAC4     A              AAA/Watch Neg
A4         86359PAD2     BBB            A/Watch Neg
M1         86359PAE0     B              BB/Watch Neg
M2         86359PAF7     B-             B/Watch Neg
M3         86359PAG5     CCC            CCC
M4         86359PAH3     CCC            CCC
M5         86359PAJ9     CC             CCC
M6         86359PAK6     CC             CCC
M7         86359PAL4     CC             CCC
M8         86359PAM2     CC             CCC
B1         86359PAP5     D              CC
B2         86359PAQ3     D              CC

Washington Mutual Asset-Backed Certificates WMABS Series 2006-HE4
Trust
Series WMABS 2006-HE4

Rating
Class      CUSIP         To             From
-----      -----         --             ----
I-A        93934QAA6     BBB            AA/Watch Neg
II-A-1     93934QAB4     AAA            AAA/Watch Neg
II-A-2     93934QAC2     BBB-           AA/Watch Neg
M-1        93934QAD0     B              BB/Watch Neg
M-2        93934QAE8     B-             B/Watch Neg
M-3        93934QAF5     CCC            CCC
M-4        93934QAG3     CCC            CCC
M-5        93934QAH1     CCC            CCC
M-6        93934QAJ7     CC             CCC
M-7        93934QAK4     CC             CCC
M-8        93934QAL2     CC             CCC
M-9        93934QAM0     CC             CCC
B          93934QAN8     D              CCC


SAYBROOK CBO: Fitch Lowers Ratings on Five Notes; Removes Watch
---------------------------------------------------------------
Fitch downgraded and removed from Rating Watch Negative five
classes of notes issued by Saybrook CBO II, Ltd.  These rating
actions are effective immediately:

  -- $202,189,368 Class A Notes downgraded to 'B' from 'BBB' and
     removed from Rating Watch Negative;

  -- $2,000,000 Class B-1 Notes downgraded to 'CCC' from 'BB+' and
     removed from Rating Watch Negative;

  -- $13,000,000 Class B-2 Notes downgraded to 'CCC' from 'BB+'
     and removed from Rating Watch Negative;

  -- $12,000,000 Class C-1 Notes downgraded to 'CC' from 'B+' and
     removed from Rating Watch Negative;

  -- $6,000,000 Class C-2 Notes downgraded to 'CC' from 'B+' and
     removed from Rating Watch Negative;

  -- $12,000,000 Preference Shares to 'PIF' from 'B+' and removed
     from Rating Watch Negative.

Fitch's rating actions reflect the collateral deterioration within
the portfolio and underlying exposure to subprime residential
mortgage-backed securities.

Saybrook II is a structured finance collateralized debt obligation
that closed on November 14, 2002 and is managed by General Re -
New England Asset Management Inc.  Presently, 62.6% of the
portfolio consists of U.S subprime RMBS, 25.4% were issued from
2005 to 2007.  The portfolio is also comprised of 12.0% Alt-A
RMBS, 11.7% asset backed securities, 4.8% prime RMBS, 3.8% CDO,
2.9% CMBS, 1.1% corporate securities, and 1.1% of manufactured
housing.

Since the last review in November 2007, approximately 26.6% of the
portfolio has been downgraded with 9.9% of the portfolio currently
on Rating Watch Negative.  Currently, 36.6% of the portfolio is
rated below investment grade, of which 20.6% of the portfolio is
rated 'CCC+' or below.

Currently, the all OC ratios are passing their respective triggers
as of the August 1, 2008 trustee report.  The downgrades to the
rated notes are a result of the credit deterioration experienced
to date and reflect Fitch's view on the long-term prospects for
ultimate receipt of principal for each of the notes.

The ratings of the class A notes address the likelihood that
investors will receive timely payment of interest and ultimate
payment of principal, as per the governing documents.  The ratings
of the class B-1, B-2, C-1 and C-2 notes address the likelihood
that investors will receive ultimate payment of interest and
ultimate payment of principal, as per the governing documents.  
The original rating of the preferred shares addressed the
likelihood that investors would receive their stated balance of
principal by the legal final maturity date.  The preferred shares
have received distributions in excess of the $12,000 000 original
rated balance and therefore are deemed to fully satisfy the
conditions of Fitch's ratings of the notes.


SELECTIVE INSURANCE: Moody's Affirms Ratings; Outlook is Stable
---------------------------------------------------------------
Moody's Investors Service has affirmed the Baa2 senior debt rating
of Selective Insurance Group, Inc. and the A2 insurance financial
strength ratings of its principal insurance operating
subsidiaries.  In the same action, Moody's changed the ratings'
outlook to stable from positive reflecting an increasingly
competitive commercial lines market and continued weakness in
Selective's personal lines book of business.

According to Moody's, the A2 insurance financial strength ratings
on Selective's operating subsidiaries reflect its solid regional
franchise with good independent agency support, along with its
conservative balance sheet, moderate financial leverage, and
consistent profitability.  Moody's believes the company has strong
risk management practices, and well developed technological
systems and tools. In recent years, the company has improved its
geographic diversification, including expansion into the Midwest
and New England.

These strengths are tempered by the continued keen competition in
the company's chosen lines of business, its significant geographic
concentration with about 30% of its business written in New
Jersey, its higher than average expense ratio, and challenging
regulatory and market environments in both New York and New
Jersey.  Profitability in the company's New Jersey personal
automobile book has been weak and commercial lines profitability
is also under pressure.  While the company's capitalization is
very good, Selective has significant exposure to catastrophe risk,
primarily Northeast hurricane, and an active share buyback
program. In addition, underwriting leverage has trended up in
recent quarters.

At the current rating level, Moody's expects continued steady,
though weaker earnings, gross underwriting leverage between about
4x and 5x, interest coverage in the mid to high single digits, and
adjusted financial leverage between 25% and 35%.  Any adverse
development is expected to be minimal (less than 4% of total
reserves), and losses from catastrophes are expected to remain
below 10% of GAAP equity.

These ratings have been affirmed with a stable outlook:

Selective Insurance Group, Inc. -- senior unsecured debt at Baa2,
senior subordinate shelf at (P)Baa3, junior subordinate debt at
Baa3, and preferred shelf at (P)Ba1;

Selective Insurance Company of America -- insurance financial
strength at A2;

Selective Way Insurance Company -- insurance financial strength at
A2;

Selective Insurance Company of South Carolina -- insurance
financial strength at A2;

Selective Insurance Company of the Southeast -- insurance
financial strength at A2; and

Selective Insurance Company of New York -- insurance financial
strength at A2.

These ratings have been assigned with stable outlook:

Selective Insurance Company of New England -- insurance financial
strength at A2; and

Selective Auto Insurance Company of New Jersey -- insurance
financial strength at A2.

The last rating action on Selective took place on September 20,
2006, when Moody's assigned a Baa3 rating to the company's junior
subordinated debentures.

Selective Insurance Group, Inc. is headquartered in Branchville,
New Jersey.  For the first half of 2008, Selective reported total
revenue of $898 million and net income of $49 million.  As of
June 30, 2008, shareholders' equity was $1.0 billion.


SHASTA APARTMENTS: Voluntary Chapter 11 Case Summary
---------------------------------------------------
Debtor: Shasta Apartments LLC
        1010 Cass St.  No. B-4
        Monterey, CA 93940

Bankruptcy Case No.: 08-32476

Chapter 11 Petition Date: September 3, 2008

Court: Eastern District of California (Sacramento)

Judge: Thomas Holman

Debtor's Counsel: David C. Johnston, Esq.
                  P.O. Box 3212
                  Modesto, CA 95353
                  Tel 209-521-6260

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.


SHELLS SEAFOOD: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Shells Seafood Restaurant, Inc.
        aka Shells of Stuart-Monterey
        16313 North Dale Mabry Highway, Suite 100
        Tampa, FL 33618

Bankruptcy Case No.: 08-13440

Chapter 11 Petition Date: September 2, 2008

Court: Middle District of Florida

Judge: Catherine Peek McEwen

Debtors' Counsel: Don M. Stichter, Esq.
                  (dstichter.ecf@srbp.com)
                  Stichter, Riedel, Blain & Prosser
                  110 East Madison Street, Suite 200
                  Tampa, FL 33602
                  Tel: (813) 229-0144
                  Fax: (813) 229-1811

Total Assets: $1,000,000 to $10,000,000

Total Debts: $1,000,000 to $10,000,000

The Debtor does not have any creditors who are not insiders.


SIX VENTURES: Case Summary & 14 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Six Ventures, Ltd.
        1335 Dublin Road, Suite 211-D
        Columbus, OH 43215
         
Bankruptcy Case No.: 08-58468

Chapter 11 Petition Date: September 3, 2008

Court: Southern District of Ohio (Columbus)

Debtor's Counsel: Richard T. Ricketts, Esq.
                  Ricketts Co., L.P.A.
                  50 Hill Road South
                  Pickerington, OH 43147
                  Tel: (614) 834-8246
                  Fax: (614) 834-8238
                  Email: rtr@ricketts-law.com

Estimated Assets: $0 to $50,000

Estimated Debts: $10,000,000 to $50,000,000

Debtor's 14 Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
A.I.M. Contracting                Trade              $7,202
5399 Richlanne Drive
Hilliard, OH 43026

American Electric Power           Utilities          $7,787
P.O. Box 24417
Canton, OH 44701-4417

BWC                                                  $16,508
Corporate Processing Department
Columbus, OH 43271-0977

City of Gahanna Water             Utilities          $22,059
Water and Sewer Services
P.O. Box 640411
OH 45284

Columbia Gas                      Utilities          $9,384
P.O. Box 9001847                  
Louisville, KY 40290-1847

Fabco                             Trade              $7,190
4640 Executive Drive
Columbus, OH 43220-3697

Fifth Third Bank                  Bank Loan          $9,356
P.O. Box 630337
Cincinnati, OH 45263-0170

Flooring Distributors             Trade              $9,119
2165 Morse Road
Columbus, OH 43229

For Rent Magazine                 Trade              $12,110
75 Remittance Drive, Suite 1706
Chicago, IL 60675-1705

G.C.C. Wholesale Carpets          Trade              $8,306
1962 East Main Street
Columbus, OH 43205

In and Out Services               Trade              $16,467
865 Wallinger Drive
Galloway, OH 43119

Ohio Remcon Inc.                  Trade              $39,662
888 West Goodale Boulevard
Columbus, OH 43212

Pad Door Systems, Inc.            Trade              $12,086
3128 East 17th Avenue, Suite B
43219-2304

Ravenor Inc.                      Trade              $21,223
5316 Franklin Street
Hilliard, OH 43017

Rea & Associates                  Accountant         $8,616
5775 Perimeter Drive              Services
Dublin, OH 43017

Verizon                           Trade              $5,755
P.O. Box 25506
Lehigh Valley, PA 18002-5506

Willis Law Firm LLC               Legal Services     $12,880
141 East Town Street. Suite 200
Columbus, OH 43215

Wilman Industries, Inc.           Trade              $36,418
Atlanta, GA 30384-4284

Winnscapes, Inc.                  Trade              $13,040
8079 Taylor Road
Columbus, OH 43230

ZipCorp DBA Service Master        Trade              $7,098          
by DRI
3995 Thistlewood
Grove City, OH 43123


ST. STEPHEN: Houston Bankruptcy Court Dismisses Chapter 7 Petition
------------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Texas
(Houston) has dismissed St. Stephen the Great LLC's
Chapter 7 petition, Graeme Neill of The Bookseller reports.

According to the report, the case was dismissed "with prejudice".

The report adds the ruling imposed a number of restrictions,
including a set period when SSG owners Mark and Philip Brewer
cannot submit another bankruptcy filing in the US.

As reported in the TCR-Europe on July 10, 2008, SSG's owners filed
for Chapter 11 reorganization but that case was subsequently
converted to a Chapter 7 liquidation proceeding.

In June 2008, Randy W. Williams, the trustee for the Chapter 7
liquidation, filed a motion to dismiss the case, arguing "on its
face there is nothing to liquidate and nothing available to fund
an investigation in the UK," The Bookseller relates.

"Due to the relatively small number of assets, the trustee did not
feel that liquidation was worth his while," Mr. Brewer was quoted
by The Bookseller as saying.

Mr. Brewer had told The Bookseller he opted to file for protection
from creditors in the US because he did not have enough money to
file for insolvency in the UK, claiming "abysmal" Christmas sales
last year meant that "by late spring, the chain was plainly
insolvent."

Mr. Brewer explained SSG was registered at Companies House in the
UK, but the management of the chain and its accounting support
were based in Houston, Texas, the Bookseller discloses.

St. Stephen the Great Ltd., aka SSG LLC, is a Christian charity
and bookseller, owned by Philip and Mark Brewer.

Based in Houston, Texas, the Debtor --
http://ststephentrust.org.uk/-- is an Orthodox lay charity   
company, which was established in 2004 to acquire redundant
churches in order to put them into use for Orthodox Christian
worship.  Its objects also include spreading the Gospel message
through distribution of the printed word and supporting Orthodox
Christian mission in the U.K.  It filed for bankruptcy with the
U.S. Bankruptcy Court for the Southern District of Texas in
Houston (Case No. 08-33689).  It listed estimated assets of
$100,000 to $500,000, and estimated debts of $1 million to $10
million in its court filing.


STATEN ISLAND HOSPITAL: Fitch Upgrades Bonds to 'B+'
----------------------------------------------------
Fitch Ratings has upgraded the rating on approximately $49 million
of Staten Island University Hospital's bonds to 'B+' from 'B'.  
The Rating Outlook has been revised to Positive from Negative.

The rating upgrade is due to the positive effects of Staten Island
University Hospital's (SIUH) tentative agreement with the federal
Office of the Inspector General that removes a significant amount
of uncertainty from SIUH's credit profile and to the improvement
in SIUH's overall financial performance.  Fitch's downgrade in
2005 and Negative Outlook were due in large measure to the ongoing
OIG investigation.  According to SIUH's 2007 audit, the hospital
has agreed to make a one-time payment of $76.5 million to the OIG,
and Fitch expects the final compliance agreement between SIUH and
the OIG to be signed by the end of the year.  The OIG had been
investigating graduate medical education reimbursement and other
federal issues at SIUH.

In anticipation of the final settlement, SIUH has escrowed the
proceeds of a $60 million bank loan, with the additional funds
coming from cash flow. Pro forma debt service coverage and cash to
debt for the six months ending June 30, 2008, were 2.4 times and
50%, respectively, above Fitch's below investment grade category
medians.  Pro forma maximum annual debt service is $27.1 million
and includes current outstanding debt service, the additional debt
service on the $60 million bank loan, and ongoing payments of
approximately $7 million a year from prior settlements with New
York State's Attorney General's Office.  SIUH's liquidity remained
stable at 49.7 days cash on hand at June 30, 2008, consistent with
prior years and slightly lower than Fitch's below investment grade
median.

The Outlook revision to Positive reflects an improved operating
margin of 4.4% through the first six months of 2008, better than
the negative 1.3% operating margin at year-end 2007.  Operating
results from 2007 were affected by a one-time adjustment of
$28.3 million related to prior year settlements, the current OIG
settlement, and changes in management estimates.  Recent
improvements in operations have been driven by an increase in case
acuity and increases in outpatient services.  Should SIUH end the
year with a strong positive operating margin and the OIG agreement
be finalized, further positive rating action may be warranted.
Fitch will be reviewing SIUH in six months at which time unaudited
year-end results should be available.

Fitch continues to view SIUH's affiliation with North Shore Long
Island Jewish Health System as a credit strength, providing SIUH
with managed care leverage, group purchasing opportunities, and
strategic support.  As part of a prior settlement, SIUH's board
has been merged into NSLIJ's board which should further strengthen
the strategic relationship between the two organizations.  NSLIJ
is not part of SIUH's obligated group and it provides no financial
support to SIUH.

SIUH is a 686-staffed bed hospital with two campuses located in
Staten Island, New York.  SIUH had total operating revenue of $593
million in fiscal 2007.  SIUH covenants to provide quarterly
disclosure to Fitch and bondholders.  Disclosure to Fitch includes
quarterly statements including a balance sheet, income statement,
and utilization statistics, and annual audited financials.

Fitch upgrades these New York City Industrial Development Agency
Civic Facility Revenue Bonds (Staten Island University Hospital
Project) outstanding debt:

  -- $17,145,000 series 2002C;
  -- $12,123,000 series 2001A;
  -- $20,000,000 series 2001B.


TAILOR MADE: Case Summary & Six Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Tailor Made Enterprises LLC
        dba The Bluffs at Brush Creek
        10007 Windsor Drive
        Lees Summit, MO 64086

Bankruptcy Case No.: 08-43634

Chapter 11 Petition Date: August 29, 2008

Court: Western District of Missouri

Judge: Jerry W. Venters

Debtors' Counsel: Lydia M. Carson, Esq.
                  (lydiacarsonlaw@yahoo.com)
                  Carson Law Center, P.C.
                  6406 East 87th Street, Suite 105
                  Kansas City, MO 64138
                  Tel: (816) 333-1110

Total Assets: $5,001,000

Total Debts: $3,147,852

A copy of the Debtor's petition is available for free at:

            http://bankrupt.com/misc/mowb08-43634.pdf


TECHNOLOGY TODAY: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Technology Today, Inc.
        12 East Broadway
        P.O. Box 339
        Shelbyville, IN 46176

Bankruptcy Case No.: 08-10823-11

Chapter 11 Petition Date: September 3, 2008

Court: Southern District of Indiana

Judge: Frank J. Ott

Debtors' Counsel: David R. Krebs, Esq.
                  (drk@hostetler-kowalik.com)
                  Hostetler & Kowalik P.C.
                  101 West Ohio Street, Suite 2100
                  Indianapolis, IN 46204
                  Tel: (317) 262-1001
                  Fax: (317) 262-1010

Total Assets: $1,258,947

Total Debts: $1,344,729

A copy of the Debtor's petition is available for free at:

           http://bankrupt.com/misc/insb08-10823-11.pdf


TEMBEC INDUSTRIES: Files for Chapter 15 Protection in Manhattan
---------------------------------------------------------------
Tembec Industries Inc. filed a Chapter 15 petition in the United
States Bankruptcy Court for the Southern District of New York as a
final step in its recapitalization.

Michel J. Dumas, Tembec's Executive Vice President, Finance and
Chief Financial Officer, filed the petition.

"The filing [on Thursday] simply closes a procedural loose end
related to the recapitalization" said James Lopez, president and
chief executive officer of Tembec.  "It is not in any way a
material event and does not in any way affect the business or the
financial condition or anything else related to the newly
recapitalized corporation."

According to Tembec, for the past several years, its business has
experienced significant challenges. Specifically, Tembec's "forest
products" segment has been severely impacted by:

   (1) the appreciation of the Canadian dollar relative to the
       U.S. dollar, which significantly has affected Tembec's
       profitability;

   (2) the slowdown in housing construction in the U.S., which
       has led to a significant decline in demand and prices for
       lumber and other wood products; and

   (3) the on-going accelerated harvesting of British Columbia
       timberlands due to mountain pine beetle infestation, which
       has further contributed to excess lumber supply and
       falling product prices.

                   Recapitalization Transaction

Through extensive negotiations, in late 2007, Tembec and the
holders of approximately 65% of the outstanding principal amount
of the senior unsecured notes agreed to the terms of a
recapitalization that would significantly de-lever Tembec's
balance sheet and enhance liquidity.  Under the Recapitalization,
disclosed on Dec. 19, 2007:

   -- the Old Notes were exchanged for 45% of the equity of
      Tembec Arrangement Inc. -- New Tembec -- a new entity
      formed for the express purpose of effecting the
      Recapitalization;

   -- the old shares of the Parent were exchanged for 5% of the
      shares of New Tembec and certain other consideration;

   -- qualifying holders of the Old Notes were offered the
      opportunity to participate as lenders in amounts up to
      their pro rata share of a new term loan provided to the
      Debtor in the principal amount of US$300 million;

   -- participants in the New Loan received their pro rata share
      of 43% of the New Shares;

   -- participants who committed to fund any portion of the New
      Loan that was not funded through the Loan Participation
      Process received the remaining 7% of the New Shares; and

   -- claims of Tembec's other creditors, including employees,
      trade creditors and customers, were not affected by the
      Recapitalization.

The Recapitalization was to be implemented through a Plan of
Arrangement pursuant to section 192 of the Canada Business
Corporations Act, R.S.C. 1985, c. C-44.  The Plan required -- and
eventually received -- the affirmative vote of not less than 66-
2/3% of the holders of the Old Notes voting on the Plan, and the
approval and sanction by an order of the Canadian Court.  The
Consenting Noteholders entered into support agreements pursuant to
which they agreed, among other things, to vote in favor of the
Plan.

On January 22, 2008, Tembec Arrangement Inc., together with Tembec
Industries and Tembec Enterprises Inc., commenced the Canadian
Proceeding by filing an application, pursuant to section 192(3)
and 192(4) of the CBCA, for an order approving the proposed Plan.

The Sanction Order confirming the Plan was issued on February 27,
2008. In addition to confirming the Plan, the Sanction Order
authorized the Petitioner to "act as a representative of any of
the Applicants or other Tembec entities in connection with the
recognition by any judicial body of the United States of America
in carrying out the terms of the Sanction Order."

"This is excellent news for the Company and its stakeholders,"
said James Lopez, President and CEO of Tembec.  "Court approval
of the Plan of Arrangement is the final step in advance of
closing the transaction.  With a secure financial footing and
solid stakeholder support, the Company that will emerge from
this transaction will be very well positioned to pursue its
business strategy.  The immediate focus will be on improving
the operating and financial performance of the Company with
the short-term goal of restoring free cash flow."

The resolutions relating to the recapitalization were granted
by in excess of 95% of shareholders of Tembec and by in excess
of 98% of noteholders of Tembec Industries Inc. on
Feb. 22, 2008.

                         Tembec's Assets

Approximately 99% of the Debtor's assets (determined by asset
value) are located in Canada.  The Debtor's principal operations
are located throughout Ontario, Quebec, British Columbia and
Manitoba. The majority of the Debtor's leased and owned real
property is located in Canada, including 100% of its production
facilities. The Debtor's sole asset in the United States is a
lease for office space located at 330 Madison Avenue, 6th Floor,
in New York. The Debtor employs approximately 4,100 employees,
approximately 98% of which reside and work in Canada.

On an annual basis, Tembec produces approximately 1.7 billion
board feet of lumber, 2.1 million tonnes of pulp and 1.0 million
tonnes of paper. For the fiscal year ended September 29, 2007,
Tembec had sales of C$2.8 billion, earnings before interest, tax,
depreciation and amortization of approximately C$65 million,
operating earnings of C$119 million and a net loss of C$49
million.

The Debtor disclosed assets and debts of more than US$1 billion
each in its petition.

The company had total assets of US$2.5 billion and total
liabilities of US$2.0 million as of Dec. 29, 2007, according to
its regulatory filing with the U.S. Securities and Exchange
Commission.  The financial report also disclosed US$56 million in
net loss on sales of US$545 million for the quarter ended Dec. 29,
2007, compared to a US$137 million net loss on sales of US$649
million in the prior year.

Tembec's total assets as of September 29, 2007 were C$2.7 billion.

The chapter 15 filing is intended to give effect to the sanction
order issued under the Canada Business Corporation Act in Canada
on Feb. 27, 2008 and does not affect the rights of any creditors
or shareholders or any security holder of Tembec Inc. or any
of its affiliates.

According to Reuters, Tembec sought Chapter 15 protection
because it was the only entity with certain debt agreements
covered by U.S. law.

                      About Tembec Industries

Based in Canada, Tembec Industries Inc., (TSX: TBC) a unit of
Tembec Inc., -- http://www.tembec.com/-- operates forest
product business comprised of four segments: forest products,
pulp, paper and chemical.  The company has operations in North
America and France.  It has about 8,000 employees.


TEMBEC INDUSTRIES: Chapter 15 Case Summary
------------------------------------------
Foreign Debtor: Tembec Industries Inc.
                Suite 1050, 800 Rene-Levesque Blvd.
                West Montreal, Quebec H3B 1X9

                -- and --

                330 Madison Avenue, 6th Floor
                New York, New York 10017

Petition Date
under CCAA:    January 22, 2008

Foreign Court: Ontario Superior Court of Justice

Chapter 15
Petitioner:     Michel J. Dumas
                Tembec's Executive Vice President,
                Finance and Chief Financial Officer

Chapter 15
Petition Date:  September 4, 2008

U.S. Court:     U.S. Bankruptcy Court
                Southern District of New York

Chapter 15
Case No.:       08-13435

Petitioner's Counsel: Douglas P. Bartner, Esq.
                      Andrew V. Tenzer, Esq.
                      Solomon J. Noh, Esq.
                      Shearman & Sterling LLP
                      599 Lexington Avenue
                      New York, NY 10022-6069
                      Tel: (212) 848-8190
                      Fax: (212) 848-4387
                      E-mail: dbartner@shearman.com

The Debtor disclosed assets and debts of more than US$1 billion
each in its petition.

The company had total assets of US$2.5 billion and total
liabilities of US$2.0 million as of Dec. 29, 2007, according to
its regulatory filing with the U.S. Securities and Exchange
Commission.  The financial report also disclosed US$56 million in
net loss on sales of US$545 million for the quarter ended Dec. 29,
2007, compared to a US$137 million net loss on sales of US$649
million in the prior year.

Tembec's total assets as of September 29, 2007, were C$2.7
billion.


TENDER MILLS: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Tender Mills Inc.
        P.O. Box 508
        Moca, PR 00676

Bankruptcy Case No.: 08-05780-11

Chapter 11 Petition Date: September 3, 2008

Court: District of Puerto Rico

Debtors' Counsel: Francisco J. Ramos Gonzalez, Esq.
                  (fjramos@coqui.net)
                  P.O. Box 371
                  Puerto Real
                  Fajardo, PR 00740
                  Tel: (787) 860-1719

Total Assets: $860,962

Total Debts: $1,890,626

A copy of the Debtor's petition is available for free at:

           http://bankrupt.com/misc/prb08-05780-11.pdf


UNION NATIONAL: Case Summary & 3 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Union National Mortgage Company of Texas LLC
        Suite 310W, 5080 Spectrum Dr.
        Addison, TX 75001
        Tel: (214) 780-0808

Bankruptcy Case No.: 08-34503

Chapter 11 Petition Date: September 3, 2008

Court: Northern District of Texas (Dallas)

Debtor's Counsel: F. Bady Sassin, Esq.  
                  Buchholz Sassin, P.L.L.C.
                  4131 N. Central Expwy., Suite 800
                  Dallas, TX 75204
                  Tel (214) 754-5500
                  Fax (214) 754-9100
                  Email f_bady_sassin@yahoo.com

Estimated Assets: $355,000

Estimated Debts: $6,332,768

Debtor's list of its 3 Largest Unsecured Creditors:

   Entity                        Nature of Claim   Claim Amount
   ------                        ---------------   ------------
Gryphon Master Fund L.P.         Judgment          $6,146,634
100 Crescent Court, Ste. 490
Dallas, TX 75201

State of Delaware                Franchise taxes     $166,409
Division of Corporations
P.O. Box 898
Dover, DE 19903

Grobstein Horwath & Co. LLP      Professional fees     $19,724
9th Floor, 15233 Ventura Blvd.
Sherman Oaks, CA 91403-2201


USAA CREDIT: Moody's Rates $18,449,198 Asset Backed Notes at Ba3
----------------------------------------------------------------
Moody's Investors Service has assigned ratings to two classes of
privately-placed USAA Credit Card Master Owner Trust, VFN Series
2007-A notes.  The notes are backed by a pool of receivables
generated by USAA-originated Visa, MasterCard and American Express
credit card accounts.

The complete rating action is as:

Issuer: USAA Credit Card Master Owner Trust

   -- Up to $30,748,663 Class C Asset Backed Notes, VFN Series
      2007-A, rated Baa3

   -- Up to $18,449,198 Class D Asset Backed Notes, VFN Series
      2007-A, rated Ba3

The ratings are based on the quality of the trust assets, the
transaction's legal and structural protections, including early
amortization triggers and credit enhancement in the form of
subordination, and the expertise of USAA as originator of the
accounts and servicer of the receivables.


VENOCO INC: Moody's Affirms Caa1 Rating on $500MM Loan Facility
---------------------------------------------------------------
Moody's Investors Service affirmed Venoco, Inc.'s ratings and
changed the rating outlook to stable from negative.  Ratings
affirmed include Venoco's B3 Corporate Family Rating, B3
Probability of Default Rating, SGL-3 Speculative Grade Liquidity
rating, Caa1 (LGD 4, 59%, changed from 61%) rated $500 million
second lien term loan facility, and Caa1 (LGD 4, 59%, changed from
61%) rated senior notes.

The stable outlook reflects Venoco's success in demonstrating more
consistent production trends and the company's more tempered
production growth targets for 2008.  Moody's had maintained a
negative outlook on Venoco's ratings primarily due to the
uncertainty concerning the credit profile of the possible
formation of a master limited partnership (MLP) on certain
reserves.  However, Venoco has since withdrawn its Form S-1 filing
with the SEC for a registered public offering of an MLP.

Venoco's rating affirmation and B3 Corporate Family Rating
reflects the company's scale and diversification, a fairly durable
core reserve base, and exploitation opportunities for production
growth; offset by a full-cycle cost structure that remains high, a
small production base, and high leverage levels, which stem from a
reliance on debt to fund acquisitions and cash flow deficits from
a historically aggressive production growth plan.

Venoco and Denbury Resources Inc. have announced that Denbury has
exercised its option to purchase Venoco's interest in the Hastings
field, a potential tertiary flood candidate.  Venoco will retain a
2% override and a 22.3% reversionary interest following payout.
The payment terms of the buyout are still being negotiated, but if
the two parties are unable to agree on a sales price, the price
will be based on the PV-10 value of the proved reserves at
Dec. 31, 2008.  Venoco estimates the Hastings' proved reserves at
approximately 18.4 million barrels of oil equivalent as of
June 30, 2008, the majority of which are proved developed
reserves.  Closing of the sale is expected in the first quarter of
2009.  Venoco has previously indicated that proceeds from the
Hastings sale could be used for a combination of debt reduction,
unwinding commodity hedges and possibly acquisitions.

Denbury's exercise of the option to purchase the Hastings field
does not have an immediate impact on Venoco's ratings.  However, a
positive outlook of Venoco's ratings is possible if Venoco uses
the proceeds from the Hastings sale to sufficiently reduce
leverage in order to offset its lower pro forma production and
reserve profile, particularly given its relatively high level of
pro forma proved undeveloped reserves, which will require
substantial capital to develop.  A positive rating action would
also be subject to: (i) Moody's review of Venoco's 2008 year-end
reserve and FAS 69 data in order to asses the company's operating
performance, (ii) Moody's expectations for possible future
materially debt financed cash flow deficits as a result of
Venoco's capital spending plans, and (iii) Moody's current sector
outlook at that time.  On the other hand, the ratings could be
subject to negative pressure if Venoco's sequential quarterly
production trends significantly deteriorate or the company's
financial leverage materially increases.

Moody's most recent rating action on Venoco was taken on April 23,
2007, in which Moody's affirmed the company's ratings with a
negative outlook.

Venoco, Inc. is headquartered in Denver, Colorado.


WESTAFF INC: Posts $15.1MM Net Loss in Third Quarter Ended July 12
------------------------------------------------------------------
Westaff Inc. reported last week financial results for its third
fiscal quarter ended July 12, 2008.  

The company reported a net loss for the third quarter of 2008 of
$15.1 million and a before tax loss from continuing operations of
$14.4 million as compared to a net loss of $2.9 million and a
before tax loss from continuing operations of $3.2 million in the
same quarter of 2007.  The current quarter reported losses
included a non-cash write down of goodwill and other intangible
assets totaling $11.5 million.  The company said this non-cash
charge does not affect the company's liquidity, cash flow, or debt
covenants, nor does it have any negative impact on future
operations.  Excluding the write down, the before tax loss from
continuing operations for the current quarter was $2.9 million.

Revenue from the third quarter of 2008 of $99.4 million compared
with revenue of $122.4 million for the third quarter of 2007.

Selling and administrative expenses for the third quarter of 2008
were reduced to $14.5 million from $16.9 million in the same
quarter of 2007.

International revenues increased by $4.5 million or 19.6% to
$27.5 million for the third quarter of 2008 compared to third
quarter of 2007.  For the first three quarters of 2008,
international revenues increased by $13.8 million from
$68.3 million to $82.1 million or 20.3%, from the same period last
year.  These increases were the result of strong performances
across most geographic regions in Australia and New Zealand.

"We have assembled a high quality management team and continue our
turnaround by aggressively pursuing expense management and
focusing on top-line revenue growth.  We are starting to see
progress in our results," commented Westaff chief executive
officer and chairman Michael T. Willis.

                          Balance Sheet

At July 12, 2008, the company's consolidated balance sheet showed
$81.9 million in total assets, $58.0 million in total liabilities,
and $23.9 million in stockholders' equity.

Full-text copies of the company's consolidated financial
statements for the quarter ended July 12, 2008, are available for
free at http://researcharchives.com/t/s?3196

                        About Westaff Inc.

Based in Walnut Creek, California, Westaff Inc. (Nasdaq: WSTF)
-- http://www.westaff.com/-- provides staffing services and  
employment opportunities for businesses in global markets.  
Westaff annually employs in excess of 125,000 people and services
more than 20,000 client accounts from more than 177 offices
located throughout the United States, Australia and New Zealand.

                          *     *     *

The company has incurred operating losses and negative operating
cash flow since the second quarter of fiscal 2007, offset by
slight operating income in the fourth quarter of fiscal 2007.  The
company says it it expects to incur additional losses in the
future, particularly because of current soft economic conditions.

In addition, the company is currently in default under the primary
credit facility that it uses to finance its operations.   If the
company is unable to obtain a waiver or continued forbearance from
the U.S. Bank National Association on acceptable terms, the
company may be unable to access the funds necessary for its
liquidity requirements or may be unable to obtain letters of
credit under the facility needed for the company to obtain
workers' compensation insurance.  In that case, its business and
operating results would be adversely affected.


WICKES FURNITURE: Deadline to Remove Actions Extended to Nov. 2
---------------------------------------------------------------
Bankruptcy Law360 reports that the Hon. Kevin J. Carey of the U.S.
Bankruptcy Court for the District of Delaware gave Wickes
Furniture Co. Inc. an additional 90 days -- through and including
November 2, 2008 -- to file notices of removal with respect to
civil actions filed against the Debtor.

According to Bankruptcy Law360, Wickes Furniture told the Court it
had been focusing its time and resources on selling its assets in
its ongoing Chapter 11 bankruptcy proceedings and not on reviewing
the civil actions.

Based in Wheeling, Illinois, Wickes Furniture Company, Inc. --
http://www.wickesfurniture.com/-- is a furniture retailers in the
U.S. with 43 retail stores serving greater Chicago, Los Angeles,
Las Vegas, and Portland.  Founded in 1971, Wickes offers
attractive room packages featuring complete living rooms, dining
rooms, bedrooms as well as bedding, home entertainment,
accessories and accent furniture.  Wickes employs over 1,700
employees and offers products from leading furniture and bedding
manufacturers.The company and two of its debtor-affiliates filed
for Chapter 11 protection on Feb. 3, 2008 (Bankr. D. Del. Lead
Case No. 08-10213).  Nancy Peterman, Esq., at Greenberg Traurig,
LLP's Miami, Florida office, and Sandra G. Selzer, Esq., at
Greenberg's Wilmington, Delaware, office represent the Debtors in
their restructuring efforts.  The Debtors selected Epiq Bankruptcy
Solutions LLC as claims, noticing and balloting agent.

The U.S. Trustee for Region 3 appointed seven creditors to serve
on an Official Committee of Unsecured Creditors.  Margaret M.
Manning, Esq., at Whiteford Taylor & Preston in Wilmington,
Delaware, represents the Committee in these cases.

When the Debtors filed for protection from their creditors, they
listed consolidated estimated assets of $10 million to $50
million, and estimated debts of $50 million to $100 million.


WYNTHROPE HALL: Case Summary & 11 Largest Unsecured Creditors
-------------------------------------------------------------
Lead Debtor: Wynthrope Hall Development, LLC
             620 North Walnut
             Murfreesboro, TN 37130

Bankruptcy Case No.: 08-07939

Type of Business: The Debtor is a single asset real estate as
                  defined in Section 101(51B) of the U.S.
                  Bankruptcy Code.

Chapter 11 Petition Date: September 3, 2008

Court: Middle District of Tennessee

Judge: Marian F Harrison

Debtors' Counsel: Roy C. Desha, Jr.
                  (bknotice@deshalaw.com)
                  Law Office Of Roy C. Desha, Jr.
                  1106 18th Avenue  
                  Nashville, TN 37212
                  Tel: (615) 369-9600
                  Fax: (615) 369-9613

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

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

A copy of the Debtor's petition is available for free at:

            http://bankrupt.com/misc/tnmb08-07939.pdf


* IATA Says Airlines to Lose $5.2 Billion in 2008
-------------------------------------------------
The International Air Transport Association revealed Wednesday a
revised industry financial forecast that would see the global
airline industry post losses of $5.2 billion in 2008 based on an
average crude oil price of $113 per barrel ($140 for jet fuel).

"The situation remains bleak.  The toxic combination of high oil
prices and falling demand continues to poison the industry's
profitability.  We expect losses of $5.2 billion this year," said
Giovanni Bisignani, IATA's Director General and CEO.

          -- Fuel

"While there has been some relief in the oil price in recent
months, the year-to-date average is $113 per barrel.  That's $40
per barrel more than the $73 per barrel average for 2007, pushing
the industry fuel bill up by $50 billion to an expected $186
billion this year," said Mr. Bisignani. Fuel is expected to rise
to 36% of operating costs, up from 13% in 2002.

          -- Demand

IATA also announced industry traffic data for July which showed a
continued slowing of demand.

July year-on-year passenger demand growth fell to 1.9% -- the
lowest in five years. Capacity increased by double that -- 3.8% --
indicating that service cuts are not keeping pace with the fall in
demand. This pushed the load factor for the month to 79.9%, a drop
of more than 1% compared to July 2007. The surprise of July was a
0.5% drop in passenger demand by Asia-Pacific carriers partly
attributable to a change in Chinese visa requirements but also
showing that economic weakness is spreading to previously robust
economies.

Cargo demand in July contracted by 1.9% compared to 2007. Asia-
Pacific carriers -- the largest players in the cargo market --
were hit hard with a 6.5% drop in demand.

As a result of the weaker economic outlook, IATA significantly
revised downward its traffic forecast for domestic and
international markets combined. Passenger traffic is now expected
to grow on average by 3.2% (was 3.9%) and air freight volumes by
just 1.8% (was 3.9%). This is only half the pace of expansion seen
in 2007 and is boosted by the stronger growth seen at the start of
the year. Strong traffic growth allowed the industry to partly
absorb the rise in fuel costs from 2003-2007. This is no longer
the case.

          -- Regional

"While some regions will show small profits, the negative impact
of the industry crisis is universal," said Mr. Bisignani.

    * North American carriers are expected to post losses of
      $5.0 billion in 2008 making them the hardest hit by this
      industry crisis.

    * Asia Pacific is expected to see profits shrink from
      $900 million in 2007 to $300 million this year.

    * European profits will tumble seven-fold from $2.1 billion
      in 2007 to $300 million in 2008.

    * Middle Eastern profits will drop by $100 million to
      $200 million.

    * Latin American and African carriers will see losses deepen
      to $300 million and $700 million respectively.

          -- 2009

IATA announced its initial outlook for 2009. The difficult
business environment is expected to continue. Most economies are
expected to deliver even weaker economic growth next year, which
will negatively impact air travel and freight. With an expected
oil price of $110 per barrel ($136 for jet fuel) and continued
weak growth (2.9% tkp), industry losses are expected to continue
at $4.1 billion. The 2009 fuel bill is expected to rise, as
hedging offers less protection, to $223 billion comprising 40% of
operating expenses.

          -- Change

"While we expect the bottom line to improve by about $1 billion
next year, the industry will be $4.1 billon in the red," said Mr.
Bisignani. "This crisis is re-shaping the industry in more severe
ways than the demand shocks of SARS or 9.11. When fuel goes from
13% of your costs to 40% in seven years with an increased cost
implication of $183 billion, you simply cannot continue to do
business in the same way. Fundamental change is needed," said Mr.
Bisignani.

"Airlines have reduced non-fuel unit costs by 18% since 2001.
Airports and air navigation service providers must join the
effort. Efficiency gains are critical but cannot fully absorb the
impact of skyrocketing fuel prices," said Mr. Bisignani.

"This crisis is highlighting the need for greater commercial
freedom. Airlines are facing enormous challenges. To be successful
and continue providing jobs to 32 million people and supporting
$3.5 trillion in economic activity, airlines must be able to do
business like any other business," said Mr. Bisignani.

"More airlines have gone bust in 2008 than in the aftermath of
9.11. To cure the structural sickness of the industry, made all
the more obvious by the high price of oil, we need a strong dose
of liberalisation. The US-EU talks later this month are one
opportunity to address ownership restrictions in an important
market. And IATA is taking the unusual step of facilitating a
global dialogue on an Agenda for Freedom next month in Istanbul.
Simply weathering the current storm is not an option. We must take
the opportunity of these extraordinary times to facilitate
extraordinary change to strengthen the industry with normal
commercial freedoms," said Mr. Bisignani.

IATA's previous forecast was made in June at a time of extreme
volatility in the oil price. Exceptionally IATA forecast a range
of industry losses between $2.3 billion -- based on a consensus
oil price of $106.5 -- and $6.1 billion -- based on an average oil
price of $122 which would have resulted, had the then current
price of oil at $135 per barrel held for the remainder of 2008.

A full-text copy of IATA's financial forecast is available at no
charge at:

               http://ResearchArchives.com/t/s?31a6

A full-text copy of July 2008 traffic results data compiled by
IATA is available at no charge at:

               http://ResearchArchives.com/t/s?31a5


* Bankruptcy Filings Up 29% in 1H, Full-Year Ended June 2008
------------------------------------------------------------
The total number of U.S. bankruptcies filed during the first six
months of 2008 increased 29.2 percent over the same period in
2007, according to data released by the Administrative Office of
the U.S. Courts.  Total filings reached 522,205 during the first
half of the calendar year of 2008 (January 1-June 30), compared to
404,090 cases filed over the same period in 2007.

Creditman.co.uk reports that statistics released by the
Administrative Office of the U.S. Courts show that filings for
bankruptcy increased 28.9% to 967,831 in the 12-month period ended
June 30, 2008, compared to 751,056 in the 12-month period ended
June 30, 2007.

"The continued rise in bankruptcies to their highest levels since
Congress changed the law points to the growing strain on family
budgets," said ABI Executive Director Samuel J. Gerdano. "We
expect this trend to continue through the end of the year, with
cases surging past 1 million by year end."

Filings by individuals or households with consumer debt increased
28.8 percent to 503,749 for the six-month period ending June 30,
2008, from the 2007 first-half total of 391,105. The overall
percentage of consumers filing for chapter 13 protection fell
slightly from 38.4 percent during the first half of 2007 (January
1-June 30) to 33.8 percent over the same period in 2008.
Conversely, the first-half 2008 percentage of chapter 7 consumer
filers increased to 66.1 percent from the 61.6 percent recorded in
the first half of 2007.

Business filings for the six-month period ending June 30, 2008,
totaled 18,456, representing a 42.1 percent increase over the
first-half 2007 total of 12,985. Chapter 7 business liquidations
increased to 13,002 in the first half of 2008, a 54.7 percent
increase over the 8,404 business chapter 7 filings during the same
period in 2007. Chapter 11 reorganizations also rose from 2,713 in
the first half of 2007 to 3,470 in the same period of 2008, a 27.9
percent increase.

The 276,510 total filings for the second calendar quarter 2008
(April 1-June 30) represented a 12.5 percent increase from the
first quarter 2008 (Jan. 1-March 31) filings of 245,695. Business
filings in the second quarter of 2008 increased 11.8 percent to
9,743 over the 8,713 business filings in the first quarter. Of
note, however, is that chapter 11 business filings decreased 8.5
percent in the second calendar quarter of 2008 to 1,658 from the
1,812 filings of the first quarter of 2008. Consumer filings
increased 12.6 percent from 236,982 recorded in the first quarter
of 2008 to 266,767 in the second quarter.

The 967,831 total filings for the 12-month period ending June 30,
2008, represented a 28.9 percent from the same period in 2007,
which totaled 751,056. The bankruptcy filing rate per thousand
U.S. residents totaled 3.15 for all chapters during the 12-month
period ending June 30, 2008, as 2.0 Americans per thousand filed
for chapter 7 while 1.12 per thousand filed for chapter 13
bankruptcy. Tennessee was the state with the highest per capita
filing rate in the country with 6.92 residents per thousand filing
in all chapters, and also had the highest per capita filing rate
for chapter 13 filings at 4.08. The state with the highest per
capita filing rate for chapter 7 bankruptcy was Michigan at 3.82
per thousand for the 12-month period ended June 30, 2008.

Nonbusiness filings for the 12-month period ending June 30, 2008,
were up to 934,009 filings, a 28.4 percent increase from the
727,167 total nonbusiness filings over the same period in 2007.
Business filings for the 12-month period ending June 30, 2008,
totaled 33,822, up 41.6 percent from the 23,889 bankruptcy
petitions filed in the 12-month period ending June 30, 2007.

The 615,748 total chapter 7 filings for the 12-month period ending
June 30, 2008, represent a 36.7 percent increase from the 450,332
filings from the same period in 2007. Total chapter 13 filings
increased 16.9 percent to 344,421 in the 12-month period ending
June 30, 2008, from 294,693 in the same period last year. Total
chapter 11 filings also increased, rising 30.6 percent to 7,293 in
2008 from 5,586 in 2007. Contrasting the upward trend, however,
were chapter 12 filings, which decreased 18.7 percent from 386 in
2007 to 314 in 2008.

Business filings for the 3-month period ending June 30, 2008,
totaled 9,743, up 45.3 percent from the 6,705 bankruptcy business
cases filed in the same period in 2007. Non-business filings for
the 3-month period ending June 30, 2008, increased 30.9 percent
from 203,744 in 2007 to 266,767 in 2008.

A breakdown of Business filings for the 3-month period ending
June 30, 2008, is:

   -- 7,043 chapter 7s,
   -- 1,658 chapter 11s,
   -- 85 chapter 12s and
   -- 940 chapter 13s.

A breakdown of non-business filings for the 3-month period ending
June 30, 2008, is:

   -- 180,353 chapter 7s,
   -- 230 chapter 11s and
   -- 86,184 chapter 13s.

                        12-Month Period

Creditman.co.uk relates that non-business filings for the 12-month
period ended June 30, 2008, increased 28.4% to 934,009, comapred
to 727,167 non-business filings for June 30, 2007.  The report
says that business filings grew 41.6% to 33,822 from the 23,889
reported in June 30, 2007.

Creditman.co.uk states that filings for Chapter 7, 13 and 11
increased in the 12-month period ended June 30, 2008, compared to
the 12-month period ended June 30, 2007:

    -- Chapter 7 filings increased 36.7% to 615,748, from the
       450,332;

    -- Chapter 13 filings rose 16.9% to 344,421, from 294,693;

    -- Chapter 11 filings grew 30.6% to 7,293, from the 5,586;

Chapter 12 filings decreased 18.7% the past year to 314 from a
total of 386 filed as of June 30, 2007, the report adds.

Bankruptcy filings during the three-month period ended June 30,
2008, totaled 276,510, the highest quarterly filings since the
Judiciary's first fiscal year quarter in 2006, Creditman.co.uk
reports.


* BOOK REVIEW: The Fallen Colossus
----------------------------------
Author:     Robert Sobel
Publisher:  Beard Books
Hardcover:  370 pages
List Price: US$34.95

Own your personal copy at
http://amazon.com/exec/obidos/ASIN/1893122883/internetbankrupt

The Fallen Colossus by Robert Sobel is the story of the Penn
Central debacle that has much to teach investors, businessmen, and
financiers about giant corporations caught in economic recessions
or industries suffering a slow decline.

It is the story of the 1970's bankruptcy of the Penn Central
Railroad, the nation's foremost transportation company.

The demise of the Penn Central, which took the form of a death
struggle for six years, was a catalyst for legislation that set
the stage for future partnerships between the private and public
sectors, a relationship enjoyed by other segments of the
transportation industry.

                             *********

Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par.  Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable.  Those sources may not,
however, be complete or accurate.  The Monday Bond Pricing table
is compiled on the Friday prior to publication.  Prices reported
are not intended to reflect actual trades.  Prices for actual
trades are probably different.  Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind.  It is likely that some entity
affiliated with a TCR editor holds some position in the issuers'
public debt and equity securities about which we report.

Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets.  At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.  
Don't be fooled.  Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets.  A company may establish reserves on its balance sheet for
liabilities that may never materialize.  The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.

A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged.  Send announcements to
conferences@bankrupt.com/

On Thursdays, the TCR delivers a list of recently filed chapter 11
cases involving less than $1,000,000 in assets and liabilities
delivered to nation's bankruptcy courts.  The list includes links
to freely downloadable images of these small-dollar petitions in
Acrobat PDF format.

Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals.  All titles are
available at your local bookstore or through Amazon.com.  Go to
http://www.bankrupt.com/books/to order any title today.

Monthly Operating Reports are summarized in every Saturday edition
of the TCR.

For copies of court documents filed in the District of Delaware,
please contact Vito at Parcels, Inc., at 302-658-9911.  For
bankruptcy documents filed in cases pending outside the District
of Delaware, contact Ken Troubh at Nationwide Research &
Consulting at 207/791-2852.

                             *********

S U B S C R I P T I O N   I N F O R M A T I O N

Troubled Company Reporter is a daily newsletter co-published
by Bankruptcy Creditors' Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland,
USA.  Sheryl Joy P. Olano, 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, Joseph
Medel C. Martirez, Ma. Cristina I. Canson, Christopher G.
Patalinghug, and Peter A. Chapman, Editors.

Copyright 2008.  All rights reserved.  ISSN: 1520-9474.

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers.  Information contained
herein is obtained from sources believed to be reliable, but is
not guaranteed.

The TCR subscription rate is $775 for 6 months delivered via e-
mail. Additional e-mail subscriptions for members of the same firm
for the term of the initial subscription or balance thereof are
$25 each.  For subscription information, contact Christopher Beard
at 240/629-3300.

                    *** End of Transmission ***