TCR_Public/081002.mbx          T R O U B L E D   C O M P A N Y   R E P O R T E R

            Thursday, October 2, 2008, Vol. 12, No. 235

                             Headlines

3 IN 1 TRINITY: Voluntary Chapter 11 Case Summary
ALEC NAMAN: Voluntary Chapter 11 Case Summary
ALITALIA SPA: Mr. Fantozzi Says Only CAI Bid for Whole Airline
AMERICAN JUSTICE: Files for Chapter 7 in Kentucky
ASARCO LLC: Files 2nd Amended Plan & Disclosure Statement

ASARCO LLC: Parent Files 2nd Amended Chapter 11 Plan
ASARCO LLC: Court Sets Nov. 17 Plan Confirmation Hearing
ASARCO LLC: Asbestos Debtors Get $10 Million Intercompany DIP Loan
ASCENDIA BRANDS: Sale-Related Incentives to Nine Executives Okayed
BEAZER HOMES: Settles SEC Probe for Securities Law Violations

BUMBLE BEE: Moody's Changes Outlook to Developing; Affirms B1 CFR
CENTERSTAGING: Point.360 Wants to Acquire Assets
CLOVER LEAF: Moody's Sets Outlook to Developing; Affirms B1 CFR
CONNORS BROTHERS: Moody's Holds Units' Corp. Family Rating to B1
CSK AUTO: Moody's Withdraws Ratings After O'Reilly Merger

DANA CORP: SEC Seeks Explanation of 2007 Annual Disclosures
DANA CORP: Visteon Corp. Wants to Withdraw $9.8 Million Claim
DELPHI CORP: Court OKs Services and Restructuring Deals with GM
DELPHI CORP: Gets Court's Nod to Modify Employee and Union Deals
DIGITILITI INC: June 30 Balance Sheet Upside-Down by $2,327,272

DOLE FOOD: Inks Letter of Intent to Sell Flowers Division
DOWLING COLLEGE: Moody's Cuts 1996, 2002 Bonds to B1; Watchlist
DRI CORPORATION: SEC Grants Request to Exclude Information
DUANE READE: Weak Operating Performance Cues Moody's to Junk PDR
ELOY COTA: Case Summary & 20 Largest Unsecured Creditors

ENERGY EXPLORATION: Changes Name to NXT Energy Solutions
ENERLUME ENERGY: Mahoney Cohen Expresses Going Concern Doubt
ENVIRONMENTAL TECTONICS: AMEX Accepts Compliance Plan
EXTERRA ENERGY: Going Concern Status in Doubt After Losses
FANNIE MAE: Wants Banks to Speed Up Mortgage Payment Transfers

FANNIE MAE: Prosecutors Ask Firm for Financial Information
FIREPOND INC: Losses Cue Auditor to Raise Going Concern Doubt
FOAMEX LP: Housing, Auto Sector Woes Cue Moody's to Junk Ratings
FORD MOTOR: Repays $1.5BB in Debt, Faces 3 Payment Obligations
FREDDIE MAC: Three Executives Leave Firm

FREDDIE MAC: Prosecutors Ask Firm for Financial Information
GANNETT CO: Taps Credit Line to Repay Commercial Paper
GENERAL MOTORS: Delphi Services & Restructuring Deals Approved
GREY'S CREEK: Case Summary & 11 Largest Unsecured Creditors
GUIDED THERAPEUTICS: Files 10-K/A to Reclassify Debt Forgiveness

HANLEY WOOD: Moody's Affirms B Ratings, Changes Outlook to Neg
HENRICKS JEWELERS: Emerges From Chapter 11 Bankruptcy
HINES HORTICULTURE: Committee Taps Stevens & Lee as Co-Counsel
HOME INTERIORS: Says Sale of Operating Units May Affect Workers
HOME INTERIORS: Committee Objects to Houlihan Lokey Employment

HOME OWNERSHIP: Moody's Cuts Preferred Stock Rating to Ba2
HRP MYRTLE: Gets Initial OK to Use $1 Million Cerberus DIP Loan
HRP MYRTLE: Section 341(a) Meeting Slated for October 21
IDEAEDGE INC: Files Prospectus to Sell 2.3 Million Common Stock
IDLEAIRE TECH: Stephen Gray Resigns as Chief Restructuring Officer

INTEGRAL VISION: Modifies Pacts with Special Situations, et al.
INTEGRAL VISION: June 30 Balance Sheet Upside Down by $4.7 Million
IRVINE SENSORS: Inks MOU to Restructure $18.4 Million Secured Debt
LAS VEGAS SANDS: Secures $475 Billion Loan From CEO
LATTICE INC: Earns $4.25 Million in 2008 Second Quarter

LEHMAN BROTHERS: Northern Trust Warns Clients of Losses        
LE JARDIN: Seeks Court Okay to Hire Moore as Bankruptcy Counsel
LENNAR CORPORATION: Posts $88.9 Bln Loss for Quarter Ended Aug. 31
LLC LCG: Voluntary Chapter 11 Case Summary
LUMINENT MORTGAGE: Plan Not Clear on Creditor Recovery, Panel Says

LUMINENT MORTGAGE: Creditors Panel Hires Professionals
MASONITE INT'L: Inks Forbearance Deal with Secured Lenders
MATRIX DEVELOPMENT: CEO Oringdulph Sued by Keybank to Recover Debt
MEDCOM USA: Jewett Schwartz Expresses Going Concern Doubt
MICHAEL VICK: Sells Belongings to Edward Howard for $10

MILLENNIUM BIOTECH: June 30 Balance Sheet Upside-Down by $13.9MM
MONTAGE II: Voluntary Chapter 11 Case Summary
MORTGAGES LTD: In Dispute With Investors on Reorganization Plan
MORTGAGES LTD: Wants Exclusive Period Extended Through Dec. 19
MOTOR COACH: U.S. Trustee Forms Five-Member Committee

MRS FIELDS: Confirmation Hearing Today; Plan Objections Are Few
NORTHERN TRUST: Warns Clients of Losses on Lehman's Bankruptcy          
NXT ENERGY: Energy Exploration Changes Name
OAKRIDGE HOMES: Creditor Asks Court to Appoint Chap. 11 Trustee
OMEGA SYTEMS: Case Summary & 20 Largest Unsecured Creditors

OPEN TEXT: Moody's Upgrades CF Rating to Ba3, Outlook Positive
PACIFICNET INC: Case Dismissed After Accord With Bondholders
PILGRIM'S PRIDE: Obtains Temporary Waiver for Covenant Violation
PLATFORM LEARNING: Taps Barton Firm as Substitute Counsel
PROFESSIONAL TRADE: Case Summary & 20 Largest Unsecured Creditors

PROXYMED INC: Completes $23.9 Million Asset Sale to Marlin Equity
QUEBECOR WORLD: Wants Court to Set December 5 as Claims Bar Date
RELIANT ENERGY: Merrill Lynch Waives Compliance Until October 31
RELIANT ENERGY: Moody's Puts Ba3 CFR on Review for Likely Cut
SEALY CORP: ValueAct Capital, et al., Disclose 3.8% Equity Stake

SEBASTIAN RIVER: Case Summary & Largest Unsecured Creditor
SEMGROUP ENERGY: Inks Forbearance Agreement with Lenders
SHAFI KEISLER: Case Summary & 19 Largest Unsecured Creditors
SHELLS SEAFOOD: Closes Restaurants After Filing for Chapter 7
SIMDAG-ROBEL: Court Denies Request to Use Deposit Interest

SOUTHERN STATES: Moody's Puts Caa1 Rating on 2012 Notes on Review
SOUTHWESTERN VIEWS: Voluntary Chapter 11 Case Summary
SOVEREIGN BANCORP: Moody's Cuts Preferred Stock Rating to Ba2
SPHERICS INC: Finn Warnke to Auction Intellectual Assets Oct. 10
SUNWEST MANAGEMENT: Cannot Pay Bills, Says Chief Financial Officer

TATONKA OIL: Case Summary & 20 Largest Unsecured Creditors
TATONKA OIL: Case Summary & Six Largest Unsecured Creditors
TEKOIL & GAS: Files List of 20 Largest Unsecured Creditors
THORNBURG MORTGAGE: Amends Exchange Offer & Extends Deadline
THORNBURG MORTGAGE: Effects 1-for-10 Reverse Stock Split

TIMBER RUN: Voluntary Chapter 11 Case Summary
TRES TIGRES: Voluntary Chapter 11 Case Summary
TURKEY HILL: Case Summary & Two Largest Unsecured Creditors
TWIN HOLLOW: Voluntary Chapter 11 Case Summary
UAL CORP: Executes Agreements to Improve Liquidity by $275 Million

UNITED THERAPY: Case Summary & 20 Largest Unsecured Creditors
VIOQUEST PHARMA: June 30 Balance Sheet Upside-Down by $5,670,850
WACHOVIA CORP: Moody's Cut Preferred Stock Rating to Ba3 from A3
WASHINGTON MUTUAL: Court Sets Status Conference Tomorrow
WASTE SERVICES: Commences Consent Solicitation for 9-1/2% Notes

WEXTRUST CAPITAL: District Court Appoints Temporary Receiver
WHITE RIVER: Creditors Ask Court to Dismiss Chapter 11 Case
WILD WEST: Founder to Testify in Dispute With Village Charters
WINDY CITY: Asks Court to Dismiss Chapter 11 Case
WISER EXCAVATING: Case Summary & 20 Largest Unsecured Creditors

WP EVENFLO: Moody's Lowers Corporate Family Rating to B3
YOUNG BROADCASTING: GAMCO Discloses 8.61% Equity Stake

* NewOak Capital Selects Senior Professionals to Advisory Practice
* Phillip Kleweno Joints Bain Corporate Renewal Group
* Legal And Business Communities Honor Memory of Tina Brozman
* Matthew Niemann Rejoins Houlihan Lokey as a Managing Director

* Chapter 11 Cases with Assets & Liabilities Below $1,000,000

                             *********

3 IN 1 TRINITY: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: 3 in 1 Trinity, LLC
        202-204 East 110th Street
        New York, NY 10029

Bankruptcy Case No.: 08-13804

Chapter 11 Petition Date: September 30, 2008

Court: Southern District of New York (Manhattan)

Judge: Robert E. Gerber

Debtor's Counsel: Dawn K. Arnold, Esq.
                  darnold@rattetlaw.com
                  Rattet, Pasternak & Gordon-Oliver, LLP
                  550 Mamaroneck Avenue
                  Harrison, NY 10528
                  Tel: (914) 381-7400
                  Fax: (914) 381-7406

Estimated Assets: $1 million to $10 million

Estimated Debts: $1 million to $10 million

The Debtor did not file a list of 20 Largest Unsecured Creditors.

                       
ALEC NAMAN: Voluntary Chapter 11 Case Summary
---------------------------------------------
Debtor: Alec Naman Catering, Inc.
        1909 Brookdale Drive West
        Mobile, AL 36618-1194

Bankruptcy Case No.: 08-13689

Type of Business: The Debtor offers catering services.

Chapter 11 Petition Date: September 29, 2008

Court: Southern District of Alabama (Mobile)

Debtor's Counsel: Irvin Grodsky, Esq.
                  igpc@irvingrodskypc.com
                  Irvin Grodsky, P.C.
                  P.O. BOX 3123
                  Mobile, AL 36652-3123
                  Tel: (251) 433-3657

Estimated Assets: $100,000 to $500,000

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

The Debtor did not file a list of 20 largest unsecured creditors.


ALITALIA SPA: Mr. Fantozzi Says Only CAI Bid for Whole Airline
--------------------------------------------------------------
Alitalia SpA's extraordinary administrator, Mr. Augusto Fantozzi
received several expressions of interest for the ailing carrier
within the terms of the deadline on Sept. 30, 2008, a press
release posted at World Aeronautical Press Agency's site said.

According to Mr. Fantozzi, only Compagnia Aerea Italiana s.r.l.'s
proposal is directly concerned with the overall activities of air
transport while the other expressions of interest concerned
specific branches or activities of the various companies making up
the Alitalia Group.

Intesa Sanpaolo, Alitalia's financial advisor for the procedure,
has started analyzing the expressions of interest received.  Upon
completion of the analysis, the proposers who meet the conditions
for initiating negotiations will undergo due diligence
examination.

Mr. Fantozzi did not name the entities who are submitting
expressions of interest.

Graham Dunn of Air Transport Intelligence reports that financial
firm AMA Asset Management Advisors (Suisse) and Italian carrier
Blue Panorama have both said they are submitting expressions of
interest covering around 30 aircraft and some Rome Fiumicino
activities respectively.

Air France-KLM chairman Jean-Cyril Spinetta also confirmed its
interest in the Italian carrier, Agence France-Presse said, citing
an unnamed source.

Meanwhile, a source told Reuters News that British Airways may
seek a commercial relationship with Alitalia and is now monitoring
developments, however, a spokeswoman for the British company said
the group was not currently interested in taking on parts of
Alitalia.

As reported in the Troubled Company Reporter-Europe on Sept. 30,
2008, various sources said CAI, the investor group formed to save
Alitalia, is considering selling a minority stake to either Air
France-KLM or Lufthansa and launching the new Alitalia by November
1.

CAI revived its bid for Alitalia after it reached agreement on new
labor contracts and redundancies with two more pilots' unions in
the early hours of Saturday, The Financial Times reported.  
According to the FT, pilots agreed to cut their salaries by 6% to
7% and reduce their holidays from 42 days to 30 days.  In return,
the FT said CAI agreed to reduce the number of lay-offs from 1,000
to 860 by taking on 140 pilots part-time.  CAI's offer of some
EUR400 million (US$584 million) for Alitalia's healthy assets is
still being evaluated by Mr. Fantozzi and independent advisers,
the FT report added.

On Sept. 22, 2008, the TCR-Europe reported that CAI withdrew its
bid to buy Alitalia's healthier assets after failing to win the
support of  labor unions.  After CAI's withdrawal, Alitalia
proceeded with its fourth public request for offers to buy any or
all parts of the company's assets until Sept. 30, 2008.

The carrier published notices in the Italian newspapers Corriere
della Sera, il Sole-24 Ore and la Repubblica, as well as the
London-based Financial Times, according to The Associated Press.

In the prepared notice cited by The AP, Alitalia is seeking
"whoever might be able to guarantee the continuity, in the medium
term, of the transportation service...to submit its expression of
interest."

                          About Alitalia

Based in Rome, Alitalia S.p.A. -- http://www.alitalia.it/--
provides air travel services for passengers and air transport of
cargo on national, international and inter-continental routes,
including United States, Canada, Japan and Argentina.  The
Italian government owns 49.9% of Alitalia.

Despite a EUR1.4 billion state-backed restructuring in 1997,
Alitalia posted net losses of EUR256 million and EUR907 million
in 2000 and 2001 respectively.  Alitalia posted EUR93 million in
net profits in 2002 after a EUR1.4 billion capital injection.
The carrier booked annual net losses of EUR520 million in 2003,
EUR813 million in 2004, EUR168 million in 2005, EUR625.6 million
in 2006, and EUR494.64 million in 2007.

Alitalia S.p.A. declared insolvency on Aug. 29, 2008, and filed
for commencement of extraordinary administration procedure at the
Tribunal of Rome.  Italian Prime Minister Silvio Berlusconi has
appointed Augusto Fantozzi as extraordinary commissioner.


AMERICAN JUSTICE: Files for Chapter 7 in Kentucky
-------------------------------------------------
The American Justice School of Law has filed for Chapter 7 in the
U.S. Bankruptcy Court for the Western District of Kentucky.

Karen Sloan at The National Law Journal reports that the school
listed assets of $1.6 million and debts of $5.2 million.  Alan
Stout, Esq., at Stout, Farmer & King, PLLC, who represents
American Justice in its restructuring effort, said he expects the
amount of debt to increase to $6 million, NLJ says.  The report
states that the American Justice's debt includes $818,391 owed to
LexisNexis and $241,000 owed to Westlaw.

NLJ relates that the American Justice was closed after students  
sued its administrators in November 2007, alleging a number of
misdeeds, including the delayed disbursement of student loans for
living expenses. As a result of a settlement, new investors and
new administrators were brought into the school, NLJ states.  The
report says that the Barkley School of Law was then created.  
According to the report, Barkley has taken on the students from
the defunct American Justice.

Larry Putt, the dean, said that the American Justice's bankruptcy
filing won't have a direct impact on the Barkley School because it
is a separate entity, NLJ says.

NLJ reports that the Barkley School could face problems with its
facilities and buildings, because they are still owned by the
American Justice and could be sold off to pay creditors.

The Barkley School plans to buy the land and facilities from the
American Justice, NLJ relates, citing Mr. Putt.

The Court has scheduled a first hearing on the case for Nov. 6,
NLJ states.

                     About American Justice

The American Justice School of Law is a private, for-profit law
school founded in 2004 in Paducah, Kentucky.  As of late December
2007, it owns facilities with an area of more than 68,000 square
feet.  The school is not accredited with the American Bar
Association.  The American Justice is no longer a functioning law
school.  It was replaced by the Barkley School of Law.


ASARCO LLC: Files 2nd Amended Plan & Disclosure Statement
---------------------------------------------------------
ASARCO LLC and its debtor-affiliates delivered to the United
States Bankruptcy Court for the Southern District of Texas final
copies of their Second Amended Joint Plan of Reorganization and a
Disclosure Statement explaining that Plan on September 25, 2008.  

The Debtors' Second Amended Plan provides, among others, that
sources of payments to be made to Claimants pursuant to the Plan
include:

   * the Debtors' cash, which could total as much as $1.4 billion
     to $1.5 billion; and

   * the Available Plan Proceeds, which are expected to total
     $2.5 billion, assuming a $90 million Adjustment Payment
     Reserve, and a $10 million Unpaid Cure Claims Reserve.

Under the global settlement agreement between the Debtors and the
asbestos parties, which is incorporated into the Second Amended
Plan, distributions to the Asbestos Trust are expected to total
at least $750,000,000, excluding the Asbestos Trust's right to
50% of the Litigation Trust Interests.  The FCR and the Asbestos
Claimants' Committee reserve the right to oppose Confirmation of
the Plan if there appears to be a significant risk that the level
of distribution cannot be realized.

At the Plans' confirmation hearing, the Second Amended Plan
indicates that the Debtors intend to present evidence as to the
reasonable range of Unsecured Asbestos Personal Injury Claims,
Miscellaneous Federal and State Environmental Claims, and Claims
relating to the Environmental Custodial Trust sites.

The Second Amended Plan discloses that Mitsui Co. (U.S.A.), Inc.,
and its related entities, and the company formerly known as
ASARCO Incorporated -- now ASARCO LLC -- entered into certain
agreements pertaining to Silver Bell that are not listed as
assumed contracts in the Plan Sponsor PSA, or otherwise assigned
to the Plan Sponsor.  The agreements include:

   (1) "Asarco Incorporated Guaranty" agreement, dated Feb. 5,
       1996, in favor of Mitsui;

   (2) a letter agreement, dated February 5, 1996, supplementing
       the Silver Bell LLC Agreement;

   (3) "Reimbursement Agreement," dated December 12, 1997, which
       is ancillary to the Equipment Lease Agreement with The
       Copper Equipment Trust and certain related agreements; and

   (4) "Commercial Agreement," dated November 9, 2007, concerning
       the purchase of copper cathodes from Silver Bell.

Whether or not Mitsui grants consent to the transfer by ARSB of
its membership interests in Silver Bell, Mitsui has requested
that the agreements, including a "Management Services Agreement,"
be assumed by and assigned to the Parent.  The Debtors note that
they have not taken a formal position with respect to the
treatment of the agreements discussed, and reserve all rights and
remedies concerning the agreements.

Blacklined copies of the Debtors' Second Amended Plan and the
accompanying Disclosure Statement is available for free at:

http://bankrupt.com/misc/Debtors_Blacklined_2ndAmended_Plan.pdf

http://bankrupt.com/misc/Debtors_Blacklined_2ndAmended_DS.pdf

                         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
US$600 million in total assets and US$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 US$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
US$2.7 billion in cash as well as a US$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.

Amended versions of the competing plans have been filed with the
Court.

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



ASARCO LLC: Parent Files 2nd Amended Chapter 11 Plan
----------------------------------------------------
Asarco Incorporated and Americas Mining Corporation delivered to
the United States Bankruptcy Court for the Southern District of
Texas a Second Amended Plan of Reorganization for Debtors
ASARCO LLC, Southern Peru Holdings, LLC, AR Sacaton, LLC, and
ASARCO Master, Inc., and a disclosure statement explaining that
Plan on September 25, 2008.

Incorporated in the Second Amended Plan are assertions from
different parties against the Parent's original and first amended
Plans, Disclosure Statement, and other Court filings; and the
Parent's position regarding those objections.  The Second Amended
Plan also incorporates sections relating to, among other things,
insurance litigation and coverage.

The Second Amended Plan provides that all classes of creditors
and interest holders will be solicited with respect to the Plan.

             Insurance Litigation & Coverage

The Asbestos Subsidiary Debtors and ASARCO LLC previously filed a
constructively fraudulent transfer suits against certain
insurers, including Century Indemnity Company and American Home
Assurance Company, seeking to avoid transfers of assets pursuant
to settlements with the defendants.  ASARCO LLC and the Asbestos
Debtors dispute Century and American Home's contention that if
insurance coverage is reinstated, it may be vitiated by the
Asbestos Debtors' and ASARCO LLC's failure to comply with policy
terms.

The Plan also provides that the Reorganized Debtors will have the
right to challenge the allowance of any demand on any ground
available in applicable law or agreements.  When a demand has
been resolved by a court order or settlement approved by the
Reorganized Debtors, the demand will be paid out of the Disputed
Claims Reserve, and will remain a liability of the Reorganized
Debtors, with additional recourse to the AMC Guaranty.

                   Class 4 Bondholders' Claims

The Second Amended Plan provides that on account of the allowed
Class 4 Bondholders' Claims, the Indenture Trustees will be
entitled to receive cash amounting to the Indenture Trustee Fee
Claims, provided that by November 17, 2008, the Parent receives
statements of their Fee Claims.

The Parent also included the assertions of more than two thirds
of the Bondholders that (i) the Parent's Plan cannot "Reinstate"
the Bonds because ASARCO must file annual audited financial
statements also with the Indenture Trustees for the municipal
Bonds in accordance with that Indentures and with public
repositories as required under Continuing Disclosure Agreements
and the securities laws governing municipal securities, and (ii)
ASARCO cannot cure its historical failure to provide audited
financial statements, among other contentions.  The Parent
believes that ASARCO will be able to cure the default and
Reinstate the Bonds.

              Plan Implementation and Distribution

To the extent there are insufficient funds in the Plan
Administration Account, or the Miscellaneous Plan Administration
Accounts to satisfy in full all Plan Obligations, the Plan
Amendment assures parties-in-interest that the Reorganized
Debtors will be obligated to fund the shortfall, and the Plan
Administrator will be authorized to enforce the obligation on
behalf of all creditors.

All distributions on account of Allowed Bondholders' Claims will
be made (i) to the respective Indenture Trustee; or (ii) with
prior consent, through the facilities of the Depository Trust
Company, if applicable.  If a distribution is made to it, the
Indenture Trustee will administer the distribution, and will be
compensated for all of its services by the Parent, the
Reorganizing Debtors, Reorganized Debtors, or the Plan
Administrator, as appropriate.

All distributions on account of Allowed Bondholders' Claims will
be subject to the right of the Indenture Trustee to exercise its
charging lien for any unpaid fee and expenses claim.  The Parent
clarifies that nothing in the Second Amended Plan will be deemed
to impair, waive, or extinguish any rights of the Indenture
Trustees under their Indentures with respect to the charging
lien.

If, at the election of the Parent, each Allowed Bondholders'
Claim is paid in full, each holder of an instrument evidencing an
Allowed Bondholder Claim will surrender that certificate to the
Indenture Trustee or the Plan Administrator, and that Certificate
will be canceled solely with respect to the Reorganizing Debtors.  
The cancellation, however, will not alter the obligations or
rights of any non-Debtor parties among persons pursuant to the
instruments.  No distribution of property will be made to the
holder until the Certificate is received by the Indenture Trustee
or the Plan Administrator.

Holders of lost or destroyed Certificate must present
satisfactory evidence and security or indemnity as may be
required by the Indenture Trustee or the Plan Administrator.
If a holder fails to surrender the Certificate by the second
anniversary of the Effective Date, the holder will be deemed to
have had its right to distributions discharged.

On the Effective Date, if each Allowed Bondholders' Claim is paid
in full, all promissory notes, instruments, indentures, bonds or
agreements will be deemed canceled, and will represent only the
right, if any, to participate in the distributions contemplated
by the Parent's Plan.

The Indentures, however, will continue in effect solely to (i)
allow distributions to be made under the Plan, (ii) permit an
Indenture Trustee to maintain or assert any right or charging
lien, (iii) permit the Indenture Trustees to assert any right to
indemnification, contribution or other claim, and (iv) permit
each Indenture Trustee to exercise its rights and obligations
relating to the interests of the Bondholders.

Certain parties requested clarification as to the payment of
interest at the contract rate.  Hence, the Plan has been amended
to provide that interest is being paid, where a written agreement
forming the basis for an allowed claim provides for interest, at
the simple contract rate specified in that written agreement.

The Second Amended Plan also reflects the Court's determination
that all Classes of creditors and interest holders will be
solicited with respect to the Plan.  The Court, however, has not
determined whether any Class is impaired or unimpaired under the
Plan.  If any Class is found to be unimpaired, holders of that
Class will have been presumed to accept the Plan and their
ballots will not have any effect, provided that the ballots of
holders of Class 5 Asbestos Personal Injury Claims will determine
whether the holders accept the treatment under Section 524(g) of
the Bankruptcy Code.

If any Class is found to be impaired, the Second Amended Plan
says that the ballots cast by the holders under the Class will be
used to determine whether the Class accepts or rejects the Plan
in accordance with Section 1126 of the Bankruptcy Code.  It also
clarifies that the Court has ruled that it was not prepared to
conduct an estimation of megaclaims before the Confirmation
Hearing.

The Second Amended Plan also includes exhibits on "FFIC's
Position Statement Regarding Risk of No Insurance Coverage," and
"ASM Capital, L.P. and Contrarian Funds, L.L.C.'s Summary of
Argument Regarding Post-Petition Interest."

Redlined copies of the Parent's Second Amended Plan and the
accompanying Disclosure Statement is available for free at:

   * http://bankrupt.com/misc/AsarcoInc_2ndAmended_DS.pdf
   * http://bankrupt.com/misc/AsarcoInc_2ndAmended_Plan.pdf

                         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
US$600 million in total assets and US$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 US$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
US$2.7 billion in cash as well as a US$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.

Amended versions of the competing plans have been filed with the
Court.

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


ASARCO LLC: Court Sets Nov. 17 Plan Confirmation Hearing
--------------------------------------------------------
The Hon. Richard S. Schmidt of the U.S. Bankruptcy Court for
the Southern District of Texas has issued a written order, on
September 25, 2008, approving the disclosure statements
explaining both the competing Plans of Reorganization filed by
ASARCO LLC and its debtor affiliates, and by ASARCO LLC's parent,
Americas Mining Corporation and Asarco Incorporated.

The Court ruled that both Disclosure Statements contain "adequate
information" within the meaning of Section 1125 of the Bankruptcy
Code, and hence, were approved in all respects.

The hearing to consider the confirmation of the Plans will
commence on November 17, 2008, at 9:00 a.m., prevailing Central
Time.  A judge from the U.S. District Court for the Southern
District of Texas may preside over the hearing along with Judge
Schmidt.

Ballots containing votes to accept or reject the Plans must be
submitted so as to be timely received on October 27, 2008, at
4:00 p.m. (Central Time).  Deadline for filing objections against
the Plans is on October 27.  Judge Schmidt also set September 23
as the voting record date.

The Balloting Agent will file a voting report on or before
November 12.  The Plan Proponents are authorized to take any
action necessary to implement the terms of, and the relief
granted in the order without seeking further Court order.  The
Debtors, however, will be excused from re-mailing any
solicitation packages and notices that are sent to holders of
claims or interests, and returned as undeliverable, unless the
Debtors have been informed of the holder's new address.

Judge Schmidt further authorized the Debtors and the Parent to
make non-substantive changes to the Disclosure Statements, Plans,
ballots and other forms, and solicitation and tabulation
procedures without further order of the Court.

                         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
US$600 million in total assets and US$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 US$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
US$2.7 billion in cash as well as a US$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.

Amended versions of the competing plans have been filed with the
Court.

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


ASARCO LLC: Asbestos Debtors Get $10 Million Intercompany DIP Loan
------------------------------------------------------------------
The United States Bankruptcy Court for the Southern District of
Texas authorized ASARCO LLC to extend a one-time intercompany loan
of up to $10,000,000 to the Asbestos Subsidiary Debtors on a
secured basis.

The Asbestos Debtors require access to cash and working capital
through the availability of the new credit facility to preserve
value and maintain administrative solvency.

Asarco Incorporated and Americas Mining Corporation previously
opposed ASARCO LLC's extension of the DIP Loan arguing that the
Loan is only a "gift" and constitutes an improper pre-
confirmation advance, which violates the Bankruptcy Code.

In support of the DIP Facility request, Douglas E. McAllister,
executive vice president, general counsel, and secretary of
ASARCO LLC, testifies that ASARCO LLC's liquidity will not be
negatively impacted by funding the loan as the company has more
than a billion dollars of cash in a bank.  He said the Asbestos
Debtors are unlikely to obtain a loan on terms more favorable to
that offered by ASARCO, and pursuing a third-party loan would be
a waste of time, resources, and would result in unnecessary
expenses and lender fees.

ASARCO LLC, Mr. McAllister said, has an interest in ensuring that
the Court approves the Intercompany DIP Loan so that the Asbestos
Debtors may pay their professionals, on a current basis, to help
defend the Debtors' Joint Plan of Reorganization against any
challenges, obtain an injunction under Section 524(g) of the
Bankruptcy Code for the benefit of Sterlite Industries (India),
Ltd., and all the Debtors, and close the Sterlite sale so that
the Joint Plan can be confirmed.

Mr. McAllister disputed the Parent's argument that the
Intercompany DIP Loan is a gift asserting that ASARCO LLC's
prepetition monetization of the insurance coverage for asbestos-
related liability resulted to ASARCO LLC incurring more than
$10,000,000 of debt from the Asbestos Debtors.

                         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
US$600 million in total assets and US$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 US$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
US$2.7 billion in cash as well as a US$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.

Amended versions of the competing plans have been filed with the
Court.

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


ASCENDIA BRANDS: Sale-Related Incentives to Nine Executives Okayed
------------------------------------------------------------------
Nine of Ascendia Brands Inc.'s top executives -- including
Binghamton Plant General Manager Robert Reardon -- will receive
total "incentive compensation" of $175,000 upon the sale of the
company and more money if sale proceeds exceed $50 million, My-Ly
Nguyen of the Press & Sun-Bulletin in Binghamton, New York,
reported Friday.

On Sept. 22, 2008, the U.S. Bankruptcy Court for the District of
Delaware approved the request of the Debtors to pay sale-related
incentives to senior management.  The proposed incentive plan
starts at a base of $175,000 to be shared among the nine
executives upon consummation of a sale and modestly increases
contingent on sale proceeds in excess of $50,000,0009

According to Ms. Nguyen, the senior exectives will receive an
additional 1 percent for each dollar of gross proceeds in excess
of $50 million to $55 million; plus 2 percent for each dollar in
excess of $55 million to $60 million; plus 2.5 percent for each
dollar in excess of $60 million to $65 million; plus 3 percent for
each dollar in excess of $65 million.

Since the Chapter 11 filing, the executives have been immersed in
an "intensive marketing process" to identify a buyer and
"negotiate the most favorable transaction possible," the company
said in the court filing.

The nine executives are: Chief Financial Officer Keith Daniels;
Vice President, General Counsel Andrew Sheldrick; Chief Operating
Officer Robert Bailey; Executive Vice President of Global Sales
Drew Collum; Executive Vice President of Marketing Bernard
Kropfelder Jr.; Information Systems Vice President Simon Brown;
Logistics Director John Lister; Supply Chain Coordinator Vince
Paccapiniccia; and Mr. Reardon of the Binghamton plant.

Mr. Reardon was hired in May 2003 and assumed his current post in
April, the company said in the court filing.

"He has been and will continue to be instrumental in preserving
and maximizing the value" of the company's assets through his
management of the Binghamton facility, Ascendia said.

                      About Ascendia Brands

Headquartered in Hamilton, New Jersey, Ascendia Brands, Inc. --
http://www.ascendiabrands.com/-- makes and sells branded consumer
products primarily in North America and over 80 countries as well.
The company's customers include Walmart, Walgreens, Kmart, Meijer
Stores, Target, and CVS.  The company and six of its affiliates
filed for Chapter 11 protection on Aug. 5, 2008 (Bankr. D. Del.
Lead Case No.08-11787).  Kenneth H. Eckstein, Esq., and Robert T.
Schmidt, Esq., at Kramer Levin Naftalis & Frankel LLP, represent
the Debtors in their restructuring efforts.  M. Blake Cleary,
Esq., Edward J. Kosmoswki, Esq., and Patrick A. Jackson, Esq., at
Young, Conaway, Stargatt & Taylor, LLP, serve as the Debtors'
Delaware counsel.  The Debtors selected Epiq Bankruptcy Solutions
LLC as their claims agent.  When the Debtors filed for protection
from their creditors, they listed total assets of $194,800,000 and
total debts of $279,000,000.


BEAZER HOMES: Settles SEC Probe for Securities Law Violations
-------------------------------------------------------------
Beazer Homes USA, Inc. has reached a settlement with the
Securities and Exchange Commission concerning an investigation
into matters that were the subject of the previous independent
investigation by the Company's Audit Committee.

Under the settlement, the Company consented, without admitting or
denying any wrongdoing, to a cease and desist order requiring
future compliance with certain provisions of the federal
securities laws and regulations. The settlement does not require
the Company to pay a monetary penalty and concludes the SEC's
investigation into these matters with respect to the Company.  In
the order, the SEC stated that in determining to accept the
settlement, it considered both remediation efforts undertaken by
and cooperation from the Company.

The Company and its subsidiary, Beazer Mortgage Corporation, are
also under investigations by the United States Attorney's Office
in the Western District of North Carolina and other state and
federal agencies, concerning the matters that were the subject of
the Audit Committee's previous independent investigation.  The
Company is fully cooperating with these investigations which are
ongoing.  The Company cannot predict or determine the timing or
final outcome of the investigations or the effect that any adverse
findings in the investigations may have on it.

According to Lloyds Corporate Litigation Reporter, Beazer received
a notice on May 1, 2007, that the SEC is conducting an informal
inquiry to determine whether any person or entity related to
Beazer Homes has violated federal securities laws.  On July 20,
2007, the Company received from the SEC a formal order of private
investigation to determine whether Beazer Homes or other persons
or entities involved with Beazer Homes have violated federal
securities laws, including, among others, the anti-fraud, books
and records, internal accounting controls, periodic reporting and
certification provisions.

                       About Beazer Homes

Headquartered in Atlanta, Beazer Homes USA Inc., (NYSE: BZH) --
http://www.beazer.com/-- is a single-family homebuilder with        
operations in Arizona, California, Colorado, Delaware, Florida,
Georgia, Indiana, Maryland, Nevada, New Jersey, New Mexico, New
York, North Carolina, Ohio, Pennsylvania, South Carolina,
Tennessee, Texas, Virginia and Virginia.  

                          *     *     *

As disclosed in the Troubled Company Reporter on June 12, 2008,
Fitch Ratings downgraded Beazer Homes USA Inc.'s Issuer Default
Rating to 'B' from 'B+'; Secured revolving credit facility to 'BB-
/RR1' from 'BB/RR1'; Senior notes to 'B-/RR5' from 'B/RR5';
Convertible senior notes to 'B-/RR5' from 'B/RR5'; and Junior
subordinated debt to 'CCC/RR6' from 'CCC+/RR6'.


BUMBLE BEE: Moody's Changes Outlook to Developing; Affirms B1 CFR
-----------------------------------------------------------------
Moody's Investors Service changed the rating outlook of Bumble Bee
Foods, LLC and Clover Leaf Seafoods, L.P to developing from
positive, following the announcement that parent Connors Brothers
Income Fund, a publicly traded Canadian income trust, will sell
these two core operating businesses to an affiliate of middle
market private equity firm Centre Partners Management, LLC.
Moody's affirmed the long-term ratings, including the corporate
family rating of B1 and the probability of default rating of B2,
and the speculative grade liquidity rating of SGL-3. The previous
rating action on November 28, 2007 confirmed the long term
ratings, assigned a positive outlook and upgraded the speculative
grade liquidity rating to SGL-3.

Ratings affirmed, with LGD adjusted for the debt instruments:

Bumble Bee Foods, LLC and Clover Leaf Seafoods L.P., as co-
borrowers

   Corporate family rating at B1

   Probability of Default Rating at B2

   $75 million senior secured revolving credit agreement expiring
in May 2011 at B1. LGD to LGD3 from LGD2 and LGD % to 32% from 29%

   $200 million senior secured term loan due in May 2012 at B1.
LGD to LGD3 from LGD2 and LGD % to 32% from 29%

   Speculative Grade Liquidity Rating at SGL-3

Under the proposed transaction, Centre Partners will pay
unitholders C$8.5 per unit price, or about C$437.5 million --
US$421 million. The assumption of debt of about $244 million,
which must be refinanced, brings total consideration to
approximately $664.7 million, or 7.67 times 2008's projected
EBITDA guidance of $86.6 million. The equity component of
consideration has not been disclosed. While it is possible, in
Moody's view, that post-acquisition leverage could be
significantly above current levels -- for the 12 months ended in
June 2008, debt to EBITDA was 4.3 times -- it is also possible
that leverage will not materially increase. Given change of
control language in documentation, existing rated debt is expected
to be refinanced or repaid.

Moody's will monitor the outcome of the planned acquisition,
including post acquisition capital structure and leverage.

The speculative grade liquidity rating of SGL-3 reflects adequate
liquidity over the next 12e months, supported by the likely
generation of sufficient operating cash flow to cover maintenance
capital spending, working capital and distributions to
unitholders. The $75 million committed revolving credit agreement
will be utilized, but not fully, and distributions to unitholders
are expected to remain aggressive until the operating companies
are acquired. Moody's anticipates that the Fund will be able to
comply with covenants with cushion. Substantially all assets are
pledged to lenders.

With combined revenues of approximately $941 million for the 12
months ended June 28, 2008, Bumble Bee Foods, LLC and Clover Leaf
Seafoods, L.P. are manufactures of branded, shelf stable fish and
other assorted protein products. These companies are co-borrowers
under the rated secured revolving credit facility and term loan,
and are the core operating subsidiaries of Connors Brothers Income
Fund, a publicly traded Canadian income trust.


CENTERSTAGING: Point.360 Wants to Acquire Assets
------------------------------------------------
TheFly's News reports that Point.360 announced that it has entered
into an agreement to acquire the assets of CenterStaging Musical
Productions, Inc., subject to approval by the U.S. Bankruptcy
Court for the Central District Of California.

Based in Burbank, Calif., Point.360 provides film, video and audio
post production, archival, duplication and distribution services
to motion picture studios, television networks, advertising
agencies, independent production companies and multinational
companies. It provides electronic and physical distribution using
fiber optics, satellite, Internet and air and ground
transportation and delivers commercials, movie trailers,
electronic press kits, infomercials and syndicated programming.

               About CenterStaging Musical

Headquartered in Burbank, California, CenterStaging Musical
Productions, Inc. -- http://www.centerstaging.com/-- is a     
rehearsal and production services company that provides production
support for most of the live television award shows like the
Academy Awards and the Grammy Awards.  The company also is a
production-support provider for TV shows such as "The Late Show
With David Letterman," "The Tonight Show With Jay Leno" and "Late
Night With Conan O'Brien."  The company filed for Chapter 11
protection on March 10, 2008 (Bankr. C.D. Calif. Case No.
08-13019).  Lewis R. Landau, Esq., in Calabasas, California,
represents the Debtor.


CLOVER LEAF: Moody's Sets Outlook to Developing; Affirms B1 CFR
---------------------------------------------------------------
Moody's Investors Service changed the rating outlook of Bumble Bee
Foods, LLC and Clover Leaf Seafoods, L.P to developing from
positive, following the announcement that parent Connors Brothers
Income Fund, a publicly traded Canadian income trust, will sell
these two core operating businesses to an affiliate of middle
market private equity firm Centre Partners Management, LLC.
Moody's affirmed the long-term ratings, including the corporate
family rating of B1 and the probability of default rating of B2,
and the speculative grade liquidity rating of SGL-3. The previous
rating action on November 28, 2007 confirmed the long term
ratings, assigned a positive outlook and upgraded the speculative
grade liquidity rating to SGL-3.

Ratings affirmed, with LGD adjusted for the debt instruments:

Bumble Bee Foods, LLC and Clover Leaf Seafoods L.P., as co-
borrowers

   Corporate family rating at B1

   Probability of Default Rating at B2

   $75 million senior secured revolving credit agreement expiring
in May 2011 at B1. LGD to LGD3 from LGD2 and LGD % to 32% from 29%

   $200 million senior secured term loan due in May 2012 at B1.
LGD to LGD3 from LGD2 and LGD % to 32% from 29%

   Speculative Grade Liquidity Rating at SGL-3

Under the proposed transaction, Centre Partners will pay
unitholders C$8.5 per unit price, or about C$437.5 million --
US$421 million. The assumption of debt of about $244 million,
which must be refinanced, brings total consideration to
approximately $664.7 million, or 7.67 times 2008's projected
EBITDA guidance of $86.6 million. The equity component of
consideration has not been disclosed. While it is possible, in
Moody's view, that post-acquisition leverage could be
significantly above current levels -- for the 12 months ended in
June 2008, debt to EBITDA was 4.3 times -- it is also possible
that leverage will not materially increase. Given change of
control language in documentation, existing rated debt is expected
to be refinanced or repaid.

Moody's will monitor the outcome of the planned acquisition,
including post acquisition capital structure and leverage.

The speculative grade liquidity rating of SGL-3 reflects adequate
liquidity over the next 12 months, supported by the likely
generation of sufficient operating cash flow to cover maintenance
capital spending, working capital and distributions to
unitholders. The $75 million committed revolving credit agreement
will be utilized, but not fully, and distributions to unitholders
are expected to remain aggressive until the operating companies
are acquired. Moody's anticipates that the Fund will be able to
comply with covenants with cushion. Substantially all assets are
pledged to lenders.

With combined revenues of approximately $941 million for the 12
months ended June 28, 2008, Bumble Bee Foods, LLC and Clover Leaf
Seafoods, L.P. are manufactures of branded, shelf stable fish and
other assorted protein products. These companies are co-borrowers
under the rated secured revolving credit facility and term loan,
and are the core operating subsidiaries of Connors Brothers Income
Fund, a publicly traded Canadian income trust.


CONNORS BROTHERS: Moody's Holds Units' Corp. Family Rating to B1
----------------------------------------------------------------
Moody's Investors Service changed the rating outlook of Bumble Bee
Foods, LLC and Clover Leaf Seafoods, L.P to developing from
positive, following the announcement that parent Connors Brothers
Income Fund, a publicly traded Canadian income trust, will sell
these two core operating businesses to an affiliate of middle
market private equity firm Centre Partners Management, LLC.
Moody's affirmed the long-term ratings, including the corporate
family rating of B1 and the probability of default rating of B2,
and the speculative grade liquidity rating of SGL-3. The previous
rating action on November 28, 2007 confirmed the long term
ratings, assigned a positive outlook and upgraded the speculative
grade liquidity rating to SGL-3.

Ratings affirmed, with LGD adjusted for the debt instruments:

Bumble Bee Foods, LLC and Clover Leaf Seafoods L.P., as co-
borrowers

   Corporate family rating at B1

   Probability of Default Rating at B2

   $75 million senior secured revolving credit agreement expiring
in May 2011 at B1. LGD to LGD3 from LGD2 and LGD % to 32% from 29%

   $200 million senior secured term loan due in May 2012 at B1.
LGD to LGD3 from LGD2 and LGD % to 32% from 29%

   Speculative Grade Liquidity Rating at SGL-3

Under the proposed transaction, Centre Partners will pay
unitholders C$8.5 per unit price, or about C$437.5 million --
US$421 million. The assumption of debt of about $244 million,
which must be refinanced, brings total consideration to
approximately $664.7 million, or 7.67 times 2008's projected
EBITDA guidance of $86.6 million. The equity component of
consideration has not been disclosed. While it is possible, in
Moody's view, that post-acquisition leverage could be
significantly above current levels -- for the 12 months ended in
June 2008, debt to EBITDA was 4.3 times -- it is also possible
that leverage will not materially increase. Given change of
control language in documentation, existing rated debt is expected
to be refinanced or repaid.

Moody's will monitor the outcome of the planned acquisition,
including post acquisition capital structure and leverage.

The speculative grade liquidity rating of SGL-3 reflects adequate
liquidity over the next 12 months, supported by the likely
generation of sufficient operating cash flow to cover maintenance
capital spending, working capital and distributions to
unitholders. The $75 million committed revolving credit agreement
will be utilized, but not fully, and distributions to unitholders
are expected to remain aggressive until the operating companies
are acquired. Moody's anticipates that the Fund will be able to
comply with covenants with cushion. Substantially all assets are
pledged to lenders.

With combined revenues of approximately $941 million for the 12
months ended June 28, 2008, Bumble Bee Foods, LLC and Clover Leaf
Seafoods, L.P. are manufactures of branded, shelf stable fish and
other assorted protein products. These companies are co-borrowers
under the rated secured revolving credit facility and term loan,
and are the core operating subsidiaries of Connors Brothers Income
Fund, a publicly traded Canadian income trust.


CSK AUTO: Moody's Withdraws Ratings After O'Reilly Merger
---------------------------------------------------------
Moody's Investors Service withdrew all ratings of CSK Auto, Inc.
following its acquisition by O'Reilly Automotive. The ratings
withdrawal is based on Moody's belief that it lacks adequate
information to maintain ratings. This concludes the review for
possible upgrade action that commenced on April 1, 2008.

Ratings withdrawn include:

   Corporate family rating of B1, presently on review for possible
upgrade;

   Probability of default rating of B1, presently on review for
possible upgrade;

   $350 million senior secured bank term loan at Ba3 presently on
review for possible upgrade;

   $100 million senior unsecured convertible notes at B3 presently
on review for possible upgrade, and

   Speculative grade liquidity rating of SGL-3.

CSK Auto, Inc., headquartered in Phoenix, Arizona, is a leading
dedicated retailer of automotive parts, with over 1,300 stores in
the U.S.
               

DANA CORP: SEC Seeks Explanation of 2007 Annual Disclosures
-----------------------------------------------------------
The U.S. Securities and Exchange Commission has asked Dana
Holding Corporation to revise certain documents filed in
connection with the company's Form 10-K for the year ended
Dec. 31, 2007, filed with the SEC on March 14, 2008.

The SEC, through a letter, asked Dana to provide information for
the SEC "to better understand the disclosure" contained in the
Form 10-K, the Management's Discussion and Analysis of Financial
Condition and Results of Operation, and the Results of Operations
Summary.  The request, the SEC said is "to assist Dana in its
compliance with the applicable disclosure requirements and
enhance the overall disclosure of the filing."

Specifically, the SEC asked Dana to, among other things:

   (1) provide, and revise future filings to include, a
       substantive reason unique to Dana as to why investors will
       find the non-GAAP financial measure useful;

   (2) provide a separate discussion of cost of sales results;

   (3) explain, and revise its notes to the financial statements
       to disclose, how Dana determined or calculated the
       $2,267,000,000 additional paid in capital that resulted
       from the issuance of new equity in connection with the
       company's emergence from Chapter 11;

   (4) revise the notes to its financial statements to include
       discloses of these matters:

          * disclosure of the significant assumptions used in the
            discounted cash flow analysis including expected
            changes in cash flows from those indicated by Dana's
            current operations, number of years for which cash
            flows were projected, discount rates and other
            significant assumptions used in Dana's analysis,
            including how any terminal value was calculated or
            determined;

          * disclosure of results of the valuation based on
            multiples of peer group companies and explain how the
            results of the analysis were combined or blended with
            the results of the discounted cash flow analysis to
            arrive at the total enterprise value of
            $3,563,000,000;

          * explanation of the nature and amounts of the
            adjustments that were made to the enterprise value of
            $3,563,000,000 to determine the value of
            $2,267,000,000 attributed to the interests of the
            common shareholders;

   (5) explain and revise its disclosure to indicate how Dana
       value the share of the 71 million shares of Dana stocks
       issued and distributed to holders of allowed unsecured
       claims and explain how Dana valued and accounted for the
       issuance of 27 million additional shares issued and set
       aside for distribution to holders of allowed unsecured
       non-priority claims in Class B under Dana's confirmed Plan
       of Reorganization;

   (6) provide details and revise its notes to explain how the
       $948,000,000 cash increase as a result of reorganization
       adjustments was calculated or determined;

   (7) explain and revise the notes to disclosure the nature of
       the $254,000,000 fair value adjustment to the deferred
       employee benefits and other non-current liabilities;

   (8) revise the notes to the reorganized consolidated balance
       sheet to include an allocation of the total reorganization
       value to the net assets of the business;

   (9) explain in the notes to the reorganized consolidated
       balance sheet the nature of the $35,000,000 adjustment
       made to notes payable and explain how this adjustment was
       calculated or determined; and

  (10) revise its disclosure to state all significant assumptions
       used by the valuation consultants or management in
       determining the valuation amounts.

A full-text copy of the Letter is available for free at
http://bankrupt.com/misc/july1Letter.pdf

In response as to, among others, the calculation of the
discounted cash flows, Dana said the basis for the discounted
cash flows were the projections published in the Plan.  The five-
year estimates, Dana added, included projected changes associated
with our reorganization initiatives, anticipated changes in
general market conditions, including variations in market regions
and known new business gains and losses, as well as other factors
considered by Dana management.  Dana told the SEC that it
completed the DCF analysis by operating segment in late 2007
using discount rates ranging from 10.5% to 11.5% based on a
capital asset pricing model which utilized weighted average cost
of capital relative to certain ASG and HVSG reference peer group
companies.

For its DCF valuation, Dana said it utilized the average of two
DCF methodologies to derive the enterprise value of Dana:

   (1) EBITDA Multiple Method -- The sum of the present values of
       the unlevered free cash flows was added to the present
       value of the terminal value of the reorganized Dana,
       computed using EBITDA exit multiples by segment based in
       part on the range of multiples calculated by using a
       comparable public company methodology, to arrive at an
       implied enterprise value for Dana's operating assets
       (excluding cash).

   (2) Perpetuity Growth Method -- The sum of the present values
       of the unlevered free cash flows was added to the present
       value of the terminal value of Dana, which was computed
       using the perpetuity growth method based in part on
       industry growth prospects and our business plans, to
       arrive at an implied enterprise value for Dana's operating
       assets (excluding cash).

Dana added that it also utilized a comparable companies
methodology, which identified a group of publicly traded
companies whose businesses and operating characteristics were
similar to those of Dana as a whole, or similar to significant
portions of Dana's operations, and evaluated various operating
metrics, growth characteristics and valuation multiples for each
of the companies in the group.  Dana then developed a range of
valuation multiples to apply to its projections to derive a range
of implied enterprise values for Dana.  The multiples ranged from
3.8 to 9.0 depending on the comparable companies.

A full-text copy of Dana's Response is available for free at
http://ResearchArchives.com/t/s?32e6

Not satisfied with some of Dana's responses, the SEC, in a second
letter, summoned Dana to, among others, include disclosure of the
EBITDA exit multiples used in the EBITDA Multiple Method and
identify sensitive assumptions for which there is a reasonable
possibility of the occurrence of a variation that would have
significantly affected the measurement value, and assumptions
about anticipated conditions that are expected to be different
from current conditions.

A full-text copy of the Second Letter is available for free at
http://bankrupt.com/misc/july29Letter.pdf

Dana, in further response, said the amendments, revisions,
further disclosures, and explanations will be reflected in their
next quarterly financial report.

Dana explained that its compromise total enterprise value is
$3,563,000,000, which represents the amount of resources
available for the satisfaction of post-petition liabilities and
allowed claims, as negotiated between the Debtors and their
creditors.  This value, Dana said, along with other terms of the
Plan, was determined only after extensive arms-length
negotiations with the claimholders.  Dana developed its view of
what the value should be based on expected future cash flows of
the business after emergence from Chapter 11, discounted at rates
reflecting perceived business and financial risks.  This
valuation and a valuation using market value multiples for peer
companies were blended to arrive at the compromise valuation,
according to Dana.

A full-text of Dana's Second Response is available for free at
http://ResearchArchives.com/t/s?32e7

In a third letter, the SEC told Dana that it completed its review
of Dana's Form 10-K and has no further comments.  A full-text
copy of the Third Letter is available for free at
http://bankrupt.com/misc/aug7Letter.pdf

                           About DANA

Based in Toledo, Ohio, Dana Corporation -- http://www.dana.com/--       
designs and manufactures products for every major vehicle producer
in the world, and supplies drivetrain, chassis, structural, and
engine technologies to those companies.  Dana employs 46,000
people in 28 countries.  Dana is focused on being an essential
partner to automotive, commercial, and off-highway vehicle
customers, which collectively produce more than 60 million
vehicles annually.

Dana has facilities in China in the Asia-Pacific, Argentina in
the Latin-American regions and Italy in Europe.

The company and its affiliates filed for chapter 11 protection
on March 3, 2006 (Bankr. S.D.N.Y. Case No. 06-10354).  As of
June 30, 2008, the Debtors listed $7,482,000,000 in total debts,
resulting in $2,979,000,000 in total shareholders' deficit.

Corinne Ball, Esq., and Richard H. Engman, Esq., at Jones Day,
in Manhattan and Heather Lennox, Esq., Jeffrey B. Ellman, Esq.,
Carl E. Black, Esq., and Ryan T. Routh, Esq., at Jones Day in
Cleveland, Ohio, represent the Debtors.  Henry S. Miller at
Miller Buckfire & Co., LLC, served as the Debtors' financial
advisor and investment banker.  Ted Stenger from AlixPartners
served as Dana's Chief Restructuring Officer. -- pls. delete this,
Tar, kai not applicable na.

Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel
LLP, represens the Official Committee of Unsecured Creditors.
Fried, Frank, Harris, Shriver & Jacobson, LLP served as counsel
to the Official Committee of Equity Security Holders.  Stahl
Cowen Crowley, LLC served as counsel to the Official Committee
of Non-Union Retirees.

The Debtors filed their Joint Plan of Reorganization on
Aug. 31, 2007.  On Oct. 23, 2007, the Court approved the
adequacy of the Disclosure Statement explaining their Plan.
Judge Burton Lifland of the U.S. Bankruptcy Court for the
Southern District of New York entered an order confirming the
Third Amended Joint Plan of Reorganization of the Debtors on
Dec. 26, 2007.

The Debtors' Third Amended Joint Plan of Reorganization was deemed
effective as of Jan. 31, 2008.  Dana Corp., starting on
the Plan Effective Date, operated as Dana Holding Corporation.

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


DANA CORP: Visteon Corp. Wants to Withdraw $9.8 Million Claim
-------------------------------------------------------------
Visteon Corporation seeks permission from the U.S. Bankruptcy
Court for the Southern District of New York to withdraw, without
prejudice, Claim No. 15037 seeking a $9,800,000 reimbursement of
its purported losses related to a vehicle recall by Ford Motor
Company.

Visteon relates that the Reorganized Dana Corp. and Affinia Group
Inc., have consented to the claim withdrawal on the condition
that the withdrawal be "with prejudice."  Visteon adds that
Affinia also required Visteon, as condition for Affinia to
approve the withdrawal, that Visteon pay all legal fees and
expenses the Reorganized Debtors and Affinia incurred.  

Representing Visteon, Michael C. Hammer, Esq., at Dickinson
Wright PLLC, in Ann Arbor, Michigan, asserts that Visteon is
entitled to withdraw its claim without prejudice and without
bearing the costs of any other party pursuant to Rule 3006 of the
Federal Rules of Bankruptcy Procedure.  He contends that Rule
3006 parallel to voluntary dismissal of civil actions after a
responsive pleading has been filed.

Under Rule 3006, Mr. Hammer notes, a creditor is entitled to
withdraw a contested clam without prejudice if the withdrawal
will not result in "legal prejudice" to any other party to the
contested matter.  

The factors to consider of whether to grant dismissal without
prejudice include (1) the creditor's diligence in bringing the
motion to withdraw claim; (2) whether the withdrawal of the claim
would result in "undue vexatiousness" on the part of the
creditor; (3) the extent to which the contested matter has
progressed, including the debtor's effort and expense in
preparation for trial; (4) the duplicative expense of re-
litigation; and (5) the adequacy of the creditor's explanation
for the need to dismiss.

These factors, Mr. Hammer emphasizes, mitigate in favor of
granting Visteon's motion because:

   (a) neither the Reorganized Debtors nor Affinia will suffer
       any legal prejudice if Visteon is permitted to withdraw
       the Claim;

   (b) Visteon acted diligently in filing both its amended Claim
       and Motion to withdraw;

   (c) Visteon has not acted with any "undue vexatiousness" but
       acted, at all times, in response to Affinia's
       contradictory statements in both the state court action
       and in the contested matter regarding its responsibility
       for the liabilities; and

   (d) the Contested Matter has only begun and no party has
       expended significant resources in the Claim litigation.

Mr. Hammer says Visteon does not intend to re-initiate litigation
of the Claim in the Court, at a later date.  The dispute between
Visteon and Affinia will continue to take place in the State
Court action, he says.

                           About DANA

Based in Toledo, Ohio, Dana Corporation -- http://www.dana.com/--       
designs and manufactures products for every major vehicle producer
in the world, and supplies drivetrain, chassis, structural, and
engine technologies to those companies.  Dana employs 46,000
people in 28 countries.  Dana is focused on being an essential
partner to automotive, commercial, and off-highway vehicle
customers, which collectively produce more than 60 million
vehicles annually.

Dana has facilities in China in the Asia-Pacific, Argentina in
the Latin-American regions and Italy in Europe.

The company and its affiliates filed for chapter 11 protection
on March 3, 2006 (Bankr. S.D.N.Y. Case No. 06-10354).  As of
June 30, 2008, the Debtors listed $7,482,000,000 in total debts,
resulting in $2,979,000,000 in total shareholders' deficit.

Corinne Ball, Esq., and Richard H. Engman, Esq., at Jones Day,
in Manhattan and Heather Lennox, Esq., Jeffrey B. Ellman, Esq.,
Carl E. Black, Esq., and Ryan T. Routh, Esq., at Jones Day in
Cleveland, Ohio, represent the Debtors.  Henry S. Miller at
Miller Buckfire & Co., LLC, served as the Debtors' financial
advisor and investment banker.  Ted Stenger from AlixPartners
served as Dana's Chief Restructuring Officer. -- pls. delete this,
Tar, kai not applicable na.

Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel
LLP, represens the Official Committee of Unsecured Creditors.
Fried, Frank, Harris, Shriver & Jacobson, LLP served as counsel
to the Official Committee of Equity Security Holders.  Stahl
Cowen Crowley, LLC served as counsel to the Official Committee
of Non-Union Retirees.

The Debtors filed their Joint Plan of Reorganization on
Aug. 31, 2007.  On Oct. 23, 2007, the Court approved the
adequacy of the Disclosure Statement explaining their Plan.
Judge Burton Lifland of the U.S. Bankruptcy Court for the
Southern District of New York entered an order confirming the
Third Amended Joint Plan of Reorganization of the Debtors on
Dec. 26, 2007.

The Debtors' Third Amended Joint Plan of Reorganization was deemed
effective as of Jan. 31, 2008.  Dana Corp., starting on
the Plan Effective Date, operated as Dana Holding Corporation.

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


DELPHI CORP: Court OKs Services and Restructuring Deals with GM
---------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York on  
Sept. 26, 2008, entered an order approving the amendments to the
Global Services Agreement and the Master Restructuring Agreement
between General Motors Corp. and Delphi Corporation.

A full-text copy of the Amended GSA and MRA is available for free
at http://ResearchArchives.com/t/s?3330

Delphi obtained approval of their new deals with General Motors
after the Official Committee of Unsecured Creditors agreed to
withdraw its objections.

                PBGC, et al., Support New GM Deal

Various parties-in-interest, including the Fiduciary Counselors,  
Inc., and the Pension Benefit Guaranty Corp., have conveyed their
support for the amendments to GSA and MRA.

Fiduciary Counselors, Inc., the appointed fiduciary charged to
assure that the Debtors fulfill their obligations with respect to
required contributions to their Hourly-Rate Pension Plan,
believes that the latest amendments would aid the Debtors' exit
from bankruptcy.  FCI filed a proofs of claim on the HRP's behalf
for legally required contributions owed to the HRP.  The Claim
amount through Dec. 31, 2007, was identified as $2,600,000,000.  
FCI has recently conferred with the HRP's actuaries and confirmed
that the amount required to meet the statutory minimum funding
requirements for the HRP as of Sept. 30, 2008, will be in an
amount ranging from $2,100,000,000 to $2,300,000,000.

William H. Schorling, Esq., at Buchanan Ingersoll & Rooney PC, in
New York, noted that GM and Delphi have obtained a private letter
ruling from the U.S. Internal Revenue Service that the proposed
414(l) Transfer pursuant to the Amended GSA and MRA will
eliminate Delphi's obligations for all contributions due on or
before Sept. 30, 2008.  Effectuating the 414(l) Transfer will
substantially satisfy HRP's Claim -- HRP will also still have
claims for any unpaid amounts due in the future -- making the
Debtors' emergence from chapter 11 more viable, Mr. Schorling
stated.  He added that implementing the 414(l) Transfer will
avoid application of the provisions of the Pension Protection Act
to the unfunded HRP obligations, again aiding the Debtors' exit
from bankruptcy.  Finally, the 414(l) Transfer, according to
Mr. Schorling, should mitigate the risk that the PBGC would take
steps to terminate the HRP.

Representing the Pension Benefit Guarantee Corporation, John A.
Menke, Esq., avers that the amended GSA and MRA constitute an
overwhelmingly positive solution to some of the Debtors' major
pension obligations and eliminates what might be insurmountable
obstacles to a successful reorganization.  If the 414(l) transfer
occurs by Sept. 29, 2008, major benefits flow to the Debtors,
certain non-Debtor affiliates and the unsecured creditors.  
Approval of the new deal, according to Mr. Menke, will relieve
the Debtors of billions of dollars of current liability for
contributions that would otherwise be due to their Hourly Plan
and that would have to be satisfied, probably in Cash lump sum,
before the Debtors could emerge.  Because Delphi's existing
liability for contributions to the hourly Plan will be erased by
the 414(l) Transfer, as soon ass possible after the first
transfer date, the PBGC said it will relinquish more than
$1,200,000,000 in liens filed against Delphi's foreign non-Debtor
affiliates.

The Official Committee of Equity Shareholders also said it is not
objecting to the new GM/Delphi deal.  However, it reserved its
right to object to the confirmation of any Chapter 11 plan filed
and any modification in the Debtors' Chapter 11 cases.  It sought
to keep its right to object to confirmation of any chapter 11
plan that does not provide appropriate value to existing equity
in exchange for the releases granted in favor of GM.

      Splinter Unions Wary of Fate of Employees and Retirees

The IUOE, IBEW and IAM -- the Splinter Unions -- informed Judge
Drain that they are fully cognizant of the external constraints
of Delphi, and that they do not object to the conceptual
framework underlying the Motion. However, the Splinter Unions
said they are not yet in a position to assess how the proposed
implementation of the amendments to the GSA and MRA will affect
the employees and retirees represented by the Splinter Unions.

The Splinter Unions say they fully expect the Debtor and GM to
provide the answers they need to be able to negotiate a timely
implementation agreement so that the employees and retirees they
represent are fairly treated.

The Splinter Unions are represented by:

     Barbara S. Mehlsack, Esq.,
     Gorlick Kravitz & Listhaus, P.C.,
     17 State Street
     New York, N.Y. 1004
     bmehlsack@gkllaw.com

                    Parties Object to New Deal  

(a) Senior Noteholders

CR Intrinsic Investors, LLC, and Highland Capital Management,
L.P., which collectively hold approximately $495,000,000 in
principal amount of Delphi senior notes, noted that Debtors are
seeking approval of the "most important and far-reaching
settlement in this case and the fixing of central elements of a
plan of reorganization", on just 10 days' notice, without
providing the most basic information necessary for the Court to
evaluate the claims to be settled, and without any pretense of
adhering to the fundamental protections to which creditors are
entitled in connection with a plan of reorganization.

CR Intrinsic and Highland consequently asked the Court to deny
Delphi the authority to implement the amended GSA and MRA in
order to prevent the Debtors from entering into sweeping and far-
reaching agreements with GM that would irrevocably impact the
outcome of the chapter 11 cases and in effect dictate the terms
of any plan of reorganization.

Isaac M. Pachulski, Esq., at Stutman, Treister & Glatt P.C., in
Los Angeles, California, averred that Delphi is seeking approval
of what amounts to a sub rosa plan of reorganization, without
providing the kind of disclosure and procedural and substantive
protection to which creditors are entitled in connection with the
confirmation of a plan, and without any creditor vote.  According
to Mr. Pachulski, a sampling of just some of the provisions of
the Amended GSA highlights how pervasively these agreements will
dictate the terms of any plan and the ultimate outcome of the
Chapter 11 cases:

   (1) the Amended GSA includes comprehensive provisions for the
       allowance and treatment of GM's claims under any plan of
       reorganization.  Among other things,

        -- GM agrees to assume certain pension liability which
           is primarily rooted in prepetition services of
           employees who worked for GM at the time of the Delphi
           spin-off in exchange for an administrative claim.  Not
           only does an administrative claim entitle GM to
           priority payment but it also handcuffs the Debtors in
           treating this claim under a plan of reorganization.

        -- the Amended GSA also contemplates that GM would be
           entitled to an unsecured claim in the amount of
           $2,500,000,000.  While GM would not be entitled to any
           recovery on the GM Unsecured Claim until other
           unsecured creditors receive at least a 20% recovery,
           both the GM Unsecured Claim and GM Admin. Claim would
           be entitled to specified, and special, treatment under
           any plan of reorganization pursuant to the Amended
           GSA.

        -- Distributions on account of the GM Claims are to be
           made by issuing preferred stock to GM which is not
           made available to any other constituent body of the
           Debtors, and the value of which remaining unknown.

   (2) The Amended GSA contemplates that the Debtors and
       their affiliates immediately release substantially all of
       their claims against GM and its affiliates on the
       effective date of the Amended GSA and reaffirm this
       release as of the date that the Debtors emerge from
       chapter 11.  The Amended GSA also requires that any
       future plan of reorganization provide that certain third
       parties, including the Creditors Committee, the Equity
       Committee, the DIP Agent, and the DIP Lenders, among
       others, release GM and its affiliates of substantially all
       of their claims against GM and its affiliates as of the
       Emergence Date.

   (3) The Amended GSA and Amended MRA leave little doubt that
       these agreements are to control and dictate the terms of
       any future plan of reorganization.  Specifically, the
       Amended GSA requires that any Delphi Plan contain
       provisions "clarifying that to the extent of any
       inconsistency between the terms of the Delphi Plan and
       [the Amended GSA] (solely as to the subject matters        
       addressed in [the Amended GSA]), the terms of [the Amended
       GSA] will govern."

(b) Indenture Trustee to Senior Notes

Wilmington Trust Company, indenture trustee for $2,000,000,000 in
Delphi senior notes and debentures, asked the Court to deny the
Debtors' motion to implement the amended GSA and MRA.

Edward M. Fox, Esq., at K&L Gates LLP, in New York, said Delphi
is seeking an unauthorized modification of the Debtors' confirmed
Plan of Reorganization, opposing Section 1127 of the Bankruptcy
Code, which not only applies to proposed modifications of actual
plan language, but also to proposed modifications of plan-related
documents, particularly where the documents [were] an integral
part of the reorganization plan and confirmation order.

Pursuant to Section 1127(b), the proponent of a plan or the
reorganized debtor may modify the plan at any time after
confirmation of the plan and before substantial consummation of
the Plan...  The Plan as modified under the this subsection
becomes the Plan only if the circumstances warrant the
modification and the court, after notice and a hearing, confirms
the plan as modified, under Section 1129.

Mr. Fox also related that the GSA and MRA may not be amended
without the approval of the Creditors Committee, as provided for
in Section 12.2 of the Plan.  He added that the Debtors' proposal
to grant a general release to GM at this time is contrary to the
best interests of creditors, particularly since the Debtors may
well need additional assistance and support from GM in order to
consummate a plan of reorganization and emerge from bankruptcy.

(c) Creditors Committee

The Official Committee of Unsecured Creditors also asked the
Court to deny the Motion, citing that the immediate release
granted to GM and the size of the allowed administrative expense
claim to GM violate Section 1127 of the Bankruptcy Code, as the
original GSA and MRA were exhibits to the Debtors' confirmed
Chapter 11 plan.

Robert J. Rosenberg, Esq., at Latham & Watkins LLP, in New York,
said that if the proposed amendments to the GSA and the MRA are
approved, it will provide GM with extra ordinary consideration in
exchange for GM entering into transactions that are tremendously
beneficial to GM on its own.  These agreements represent no less
than the complete abdication by the Debtors of all control over
their destiny, without regard to the consequence to their
unsecured creditors, Mr. Rosenberg explained.

                   Delphi Addresses Objections

John Wm. Butler, Jr., Esq., at Skadden, Arps, Slate, Meagher &
Flom LLP, in Chicago, Illinois, noted that although certain
parties allege that the Debtors are requesting relief that is
not in the best interests of the estates and in breach of their
fiduciary duties, only these parties filed objections that remain
unresolved:

    -- the International Union of Electronic, Electrical,
       Salaried, Machine and Furniture Workers-Communication
       Workers of America and the United Steelworkers of America,
       which are continuing to collectively bargain  
       implementation agreements with Delphi which would include        
       their consent to Amended GSA and MRA

    -- the official committee of unsecured creditors; Wilmington
       Trust Company, a member of the Creditors Committee; and CR
       Intrinsic and Highland, whose interests are represented by
       both the Creditors Committee and WTC.

The Debtors furnished a chart summarizing their responses to
objections, a copy of which is available for free at   
http://ResearchArchives.com/t/s?332f

The Debtors pointed out that their largest union, the United Auto
Workers, is not opposing to the Amended GSA and MRA.  They added
that the Equity Committee, Fiduciary Counselors, the PBGC, and
three unions have conveyed support or no objections.

Contrary to the assertions of the Creditors Committee, the
Amended GSA and MRA are the product of months of intense, arm's-
length bargaining between the Debtors and GM during which the
Debtors clearly considered various alternatives and options to
the Amended GSA and the Amended MRA, Mr. Butler clarified.

Mr. Butler recounted that when Appaloosa Management, L.P., and
the other Plan Investors failed to participate in the April 4,
2008 closing, Delphi's Board of Directors convened the first of
nine meetings that would be held between that date and the
Board's ultimate approval of the Amended GSA and MRA on Sept. 12.  
The Debtors also met with the Creditors Committee and held
discussions with GM about a modified plan of reorganization
framework involving a stand-alone plan to be funded internally
through adjustments to the recoveries of GM, general unsecured
creditors, and other stakeholders.  Those discussions concluded
on June 25, when GM informed Delphi that it was not willing to
provide the level of incremental financial support that would
have been necessary to make a standalone plan of reorganization
framework possible under the RPOR as it existed at that time.

Promptly after learning of GM's decision, Delphi began a process
of identifying and assessing a range of specific strategic
alternatives that included POR modifications providing for debt
financing and equity financing through a rights offering
backstopped by creditors or other potential investors.  In
addition, in mid-July 2008, Delphi and GM re-engaged in
constructive discussions that addressed, among other things, the
incremental financial support needed to make the revised POR a
realistic business plan that should attract interest in the
capital markets.  These efforts have resulted in a number of
significant developments since April 2008, all of them
accomplished against the backdrop of deteriorating macroeconomic
and automotive industry conditions and turbulence in the capital
markets, Mr. Butler detailed.

Throughout this process, Delphi's senior leadership acted with
diligence and in accordance with its fiduciary duty to maximize
the business enterprise value of Delphi and its affiliates and
thereby maximize the opportunities for recoveries by the Debtors'
stakeholders.  In doing so, Delphi, according to Mr. Butler,
considered the Creditors Committee's demand that the Debtors play
a high-stakes game of "chicken" with GM up through the 414(l)
Transfer deadline of Sept. 29, 2008, in the hopes that GM would
eventually agree to what the Creditors Committee was really
seeking --- a form of guaranteed recovery for general unsecured
creditors from GM.  Delphi ultimately rejected that approach
because it believed that obtaining GM's commitment to take on an
upsized 414(l) Transfer, assume prompt financial responsibility
for other post-employment benefits, and provide what the Debtors
concluded was the additional required support for the RPOR was,
on balance, more beneficial to the Debtors and their stakeholders
than holding out for more at the risk of losing everything.

Although the Creditors' Panel may not agree with their decisions
for failing to initiate litigation or use other "tools" against
GM, the Debtors believe that their decisions since April 4 are
sound.  Mr. Butler avers that both the timeline of events and the
breadth of support GM is providing through the Amended GSA and
the Amended MRA demonstrate that the Debtors did not "surrender"
or abdicate control of these cases to GM.  The Debtors firmly
believe that the Amended GSA and MRA are in the best interests of
the estates, and that entry into the agreements is fundamentally
necessary for any meaningful recovery to stakeholders.

         Creditors Committee Renews Support for GM/Delphi

Delphi creditors have concurred to proposed amendments to
agreements between the auto-parts maker and its former parent
General Motors Corp., removing one hindrance to Delphi's exit
from bankruptcy after almost three years, Bloomberg News reports.

Judge Drain approved the Amended GSA and MRA after Delphi reached
a deal with the Creditors Committee.  Mr. Butler, Delphi's
counsel, told the Court at the Sept. 25 hearing that the
Creditors Committee tentatively agreed to amendments that would
change how creditors are paid in the company's restructuring as
well as the terms of preferred stock GM would receive under an
amended POR.

The hearing was originally scheduled for Sept. 23, but was
adjourned for two days to allow the Debtors and the Creditors
Committee to reach common ground.

The Creditors Committee's counsel, Robert J. Rosenberg, Esq., at
Latham & Watkins LLP, in New York, confirmed the deal.  "All's
well that ends well," Mr. Rosenberg, after retracting the
Committee's objection to the new GM deals, which would allow
Delphi to exit bankruptcy.

"Today was a major milestone in these Chapter 11 cases,"
Mr. Butler said at the Sept. 25 hearing.

Delphi and the Creditors Committee engaged in negotiations
regarding the Amended GSA and MRA.  Possible scenarios, according
to Reuters, included GM accepting preferred Delphi shares, or
splitting administrative proceeds 50-50 with Delphi's unsecured
creditors.  The Debtors and GM reached a first amendment to the
Amended GSA on Sept. 25, 2008, which added these provisions:

    1. "GUC Percentage" shall mean .2 multiplied by the amount of
       allowed general unsecured claims (exclusive for all
       purposes of this section 1.57(a) of holders of TOPrS
       Claims, as defined in the 2007 Plan) divided by the sum of
       $2.055 billion and the product of .2 and the amount of
       allowed general unsecured claims.

    2. If any condition for the receipt by GM of the preferred
       stock described in Section 4.04(c) of the GSA is not
       satisfied or waived by GM, holders of general       
       unsubordinated unsecured claims (exclusive for all
       purposes of this section 4.04(a) of TOPrS Claims, as
       defined in the 2007 Plan) shall receive 50% of all
       distributions that otherwise would be made to GM on
       account of its administrative expense claims allowed
       pursuant to this Section 4.04(a) to the extent necessary
       for such holders to receive an aggregate distribution,       
       exclusive of any value received as a result of
       participation by such holders in any rights offering or
       similar undertaking, on account of their allowed general
       unsubordinated unsecured claims equal in value of up to
       $300 million.

    3. If all conditions for the receipt by GM of the preferred
       stock described in the preceding sentence are satisfied,
       value equal (at Plan value) to an amount of up to the GUC
       Percentage multiplied by the stated value of the preferred
       stock otherwise distributable to GM under the first
       sentence of this Section 4.04(c) shall be distributed to        
       holders of general unsubordinated unsecured claims
       (exclusive for all purposes of this section 4.04(c) of
       holders of TOPrS Claims, as defined in the 2007 Plan) to
       the extent necessary to permit the holders of general
       unsubordinated unsecured claims to receive distributions,
       exclusive of any value received as a result of
       participation by such holders in any rights offering or
       similar undertaking, equal to 20% of their allowed general
       unsubordinated unsecured claims.  

    4. Any amendments to the Amended GSA or the Amended MRA that
       are materially adverse to the Debtors' estates shall
       require the consent of the Creditors Committee.

A full-text copy of the First Amendment to the Amended GSA is
available for free at http://ResearchArchives.com/t/s?332e

Delphi also posted a summary of indicative terms for the
preferred stock it will issue to GM pursuant to a POR.  The
summary provides that Shares of Series D Convertible Preferred
Stock, par value $0.01 per share, with an aggregate initial
stated value of $2,055,000,000 will be issued to GM.  Delphi may
pay cash to GM to reduce the number of shares issued at a price
equal to the Stated Value per share.  A copy of the Summary is
available for free at http://ResearchArchives.com/t/s?332d

                    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 June 30, 2008, the company's balance sheet showed total assets
of $136.0 billion, total liabilities of $191.6 billion, and total
stockholders' deficit of $56.9 billion.  For the quarter ended
June 30, 2008, the company reported a net loss of $15.4 billion
over net sales and revenue of $38.1 billion, compared to a net
income of $891.0 million over net sales and revenue of $46.6
billion for the same period last year.

                       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 US$9,162,000,000
in total assets and US$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 US$2,550,000,000 in equity financing to
Delphi.

(Delphi Bankruptcy News, Issue 146; Bankruptcy Creditors' Service
Inc., http://bankrupt.com/newsstand/or 215/945-7000)


DELPHI CORP: Gets Court's Nod to Modify Employee and Union Deals
----------------------------------------------------------------
Judge Robert Drain of the U.S. Bankruptcy Court for the Southern
District of New York overruled all objections and granted the
request of Delphi Corp. to change effective dates of certain
Memorandum of Understanding provisions, and to negotiate the
changes with Delphi's unions.

Delphi may now begin talks with unionized workers on freezing
contributions to existing pension plans.  Judge Drain overruled
an objection by the Official Committee of Unsecured Creditors,
which said turmoil in the auto industry made it a bad time to
create a new benefit plan for senior managers.

The United Steelworkers of America says it is committed to
continued good-faith negotiations to reach a mutually acceptable
implementation agreement in connection with the Delphi's request.

Representing USW, Hanan B. Kolko, Esq., at Meyer, Souzzi, English
& Klein, P.C., informs the Court that the USW is cognizant of the
circumstances giving rise to the Debtors' request.  USW, however,
submitted a limited objection due to the short time which the it
has had to review and evaluate the implementation agreement and
engage in negotiations, and because the negotiations have not yet
resulted in an agreement.

Former Delphi retires who are former General Motors Corp.
executives submitted to the Court their concerns about the impact
the proposed modification of the GSA and MRA would bring to their
retirement and post-retirement benefits.  These retirees are
especially apprehensive that they will be excluded from the
Supplemental Executive Retirement Program, and they ask the Court
for the (i) continuation of their SERP payments or (ii) fairly
determined cash settlement for their benefits.

The Delphi retirees are, among others, David J. Bastin, Allen W.
Besey, Garry J. Brooks, Larry F. Cracaft, Robert L. Fatzinger,
Edward A. Golick, James B. Hegstrom, Weslay Don Helm, Robert P.
Hoffman, John R. Holmes, William M. Jenkins, Michael L. Julius,
Larry D. Kesler, Bruce E. Kirkhan, John F. Lambert, Michael R.
Lippa, Ronald R. Malanga, Terry L. Marquis, Dennis Mead, John R.
Neville, Jacob Pikaart, Jerry Shafer, Francis H. Titzenhaler,
Charles L. Rose, Allan B. Rowley, Patrick J. Straney, Michael K.
Stout, Ronald Turkett, Wyne J. Varady, and Kenneth G. Wingeier.

Dawn M. Eaton, a salaried worker at Delphi, objected to service
costs and aspects of the pension freeze and follow-on plans.  She
pointed out that the (i) service cost for the Motion was
frivolous expense of $4,000,000, and (ii) the Defined
Contribution Plan should be an administrative expense claim.

          Cred. Committee Supports Pension Plan Freeze

The Debtors noted that they have received only four timely filed
objections out of more than 12,000 parties affected by their
request for authority to modify the hourly and salaried pension
programs.

John Wm. Butler, Jr., Esq., at Skadden, Arps, Slate, Meagher &
Flom LLP, in Chicago, Illinois, had informed the Court that while
the Committee objected to the Motion, it actually concedes its
support for the freezing of the Debtors' pension plans and most
aspects of the follow-on plans.  The Creditors Committee, he
points out, also concedes that the relief requested will save the
estates money, with the save and replacement package saving
millions of dollars per quarter.  

Mr. Butler added that the International Union of Electronic,
Electrical, Salaried, Machine and furniture Workers-Communication
Workers of America have raised no substantive issue in its
objection, and the Debtors fulfilled the IUE-CSA's discovery
request.  The Debtors believe there's no need for them to address
the IUE-CWA objection; the Debtors instead request the Court to
strike the IUE-CWA objection to the extent that it is not
withdrawn prior to the hearing.

With regards to the objection asserted by Ms. Eaton, the Debtors
noted that the objection was untimely and assert that the Court
should strike or otherwise overrule that objection about the
objectors concern that the service costs exceeded $4,000,000.  
For the sake of clarification, the Debtors declare that the
service costs were approximately $400,000.

The Debtors pointed out that the cost is justified by the
millions of dollars in savings that would be achieved if the
Court approves the Motion.

According to Bloomberg News, Mr. Butler said, "[i]t would be
patently unreasonable" to create replacement plans for everyone
except 460 top executives."

                       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 US$9,162,000,000
in total assets and US$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 US$2,550,000,000 in equity financing to
Delphi.

(Delphi Bankruptcy News, Issue 146; Bankruptcy Creditors' Service
Inc., http://bankrupt.com/newsstand/or 215/945-7000)

       
DIGITILITI INC: June 30 Balance Sheet Upside-Down by $2,327,272
---------------------------------------------------------------
Digitiliti, Inc.'s consolidated balance sheet at June 30, 2008,
showed $3,668,260 in total assets and $5,995,532 in total
liabilities, resulting in a $2,327,272 stockholders' deficit.

At June 30, 2008, the company's consolidated balance sheet also
showed strained liquidity with $831,372 in total current assets
available to pay $4,103,946 in total current liabilities.

The company reported a net loss of $2,212,817 on revenues of
$768,208 for the second quarter ended June 30, 2008, compared with
a net loss of $1,169,941 on revenues of $291,048 in the same
period a year ago.

The company attributes the increase in revenue to the increase in
customers under contract and the resulting terabytes of data added
to the company's Fortress Storage Center, combined with the growth
in existing customer data.  

Research and development expenses increased to $641,792 during the
three months ended June 30, 2008, from $0 during the three months
ended June 30, 2007.  

General and administrative expenses increased $357,981 to
$1,175,814 for the three months ended June 30, 2008, compared to
$817,833 during the three months ended June 30, 2007.  This  
increase is attributable to consulting fees, stock-based  
compensation, legal and accounting expense associated with
completing the "reverse" merger between the company and Storage
Elements, Inc., a Minnesota corporation, upgrading the financial
information in preparation for Securities and Exchange Commission
anticipated filings and the issuance of convertible debt with
associated warrants.

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?3312

                       Going Concern Doubt

The company incurred a net loss of $2,212,817 for the three months
ended June 30, 2008.  In addition, the company has an accumulated
deficit of $10,509,180 and a working capital deficit of $3,272,574
as of June 30, 2008.  These conditions raise substantial doubt as
to the company's ability to continue as a going concern.

                      About Digitiliti Inc.

Headquartered in St. Paul, Minnesota, Digitiliti, Inc. (OTC: DIGI)
-- http://www.digitiliti.com/-- operates as a software developer  
and hardware integrator that creates and implements open
enterprise class data storage solutions.  It provides online data
protection and primary storage consolidation solutions.  The
company offers digitiliti service, a Web-based data storage and
remote backup solution that serves large and mid-size  
organizations, and education and government institutions.  The
company was formerly known as Storage Elements, Inc. and changed
its name to Digitiliti, Inc. in 2007.  


DOLE FOOD: Inks Letter of Intent to Sell Flowers Division
---------------------------------------------------------
Dole Food Company, Inc. disclosed in a Securities and Exchange
Commission the status of pending asset sale transactions.

Dole has signed a binding letter of intent to sell its flowers
division.  The sale of the flowers division is expected to take
place in two or three phases, with closing of at least the first
phase expected to occur in the fourth quarter of 2008.

Dole has signed a definitive purchase and sale agreement to sell
its JP Fresh subsidiary in England and its ripening and
distribution business in France to Compagnie Financiere de
Participations, a company in which Dole holds a non-controlling
40% stake, with closing expected to occur in the fourth quarter of
2008.

When all phases of the flowers transaction are complete, net
proceeds to Dole from the sale of the flowers division, the two
Dole ripening and distribution companies in Europe and some
additional agricultural acreage in California, Hawaii and Mexico
will be approximately $145 million.

The cash proceeds of these transactions will be used to pay down
Dole's senior secured credit facilities. These net proceeds of
$145 million, when added to the $132 million in asset sales
disclosed in Dole's Second Quarter 2008 Form 10-Q filed on July
29, 2008, will bring the total of asset sales to approximately
$277 million.

"Dole is pleased to be moving forward with these asset sale
transactions, continuing to execute on our previously announced
plan to sell assets to reduce our debt," said David A. DeLorenzo,
President and CEO of Dole.

                        About Dole Food

Based in Westlake Village, California, Dole Food Company Inc. --
http://www.dole.com/ -- is the world's largest producer and     
marketer of high-quality fresh fruit, fresh vegetables and fresh-
cut flowers.  Dole markets a growing line of packaged and frozen
foods and is a produce industry leader in nutrition education and
research.

                          *     *     *

As disclosed in the Troubled Company Reporter on April 21, 2008,
Standard & Poor's Ratings Services assigned recovery ratings to
Dole Food Co. Inc.'s unsecured debt issues and raised the issue-
level ratings on this debt.  The issue-level ratings on the
unsecured debt were raised to 'B-' from 'CCC+'.  Recovery ratings
of '4' were assigned to this debt, indicating the expectation of
average (30%-50%) recovery in the event of a payment default.
     
In addition, Dole Food Company Inc. carries Moody's Investors
Service's Caa1 Senior Unsecured Debt rating assigned on Feb. 25,
2008.  Rating holds to date.


DOWLING COLLEGE: Moody's Cuts 1996, 2002 Bonds to B1; Watchlist
---------------------------------------------------------------
Moody's Investors Service has downgraded to B1 from Ba3 the rating
on Dowling College's $10.4 million of Series 2002 bonds issued
through Town of Brookhaven Industrial Development Agency and the
rating on $5.7 million of Series 1996 bonds issued through the
Suffolk County Industrial Development Agency. The ratings were
placed on watchlist for possible downgrade. Moody's review of the
College's credit will focus on net tuition revenue generated in
fall 2008 based on final enrollment levels, up to date levels of
unrestricted cash and investments, and debt service payments and
other cash requirements over the next year.

The downgrade reflects the College's very thin liquidity ($3.8
million of unrestricted cash and investments as of June 30, 2008,
the lowest point for the fiscal year, including drawings under a
line of credit), reliance on $3 million line of credit for
seasonal cash flow ($3 million drawn as of June 30, 2008 although
$0 currently outstanding), challenging student market position
(approximately 79% freshmen selectivity and 23% freshmen
matriculation in fall 2008, with enrollment declines sustained in
recent years due to inadequate recruitment and retention
strategies), and weak operating cash flow and debt service
coverage. The College's total cash and investments declined in FY
2007 and FY 2008 (based on draft FY 2008 financials) and provide a
very slim cushion for the College's large operating base ($72.8
million of expenses in FY 2007) and high debt levels ($66.6
million of direct debt).

LEGAL SECURITY:

The Series 1996 and 2002 bonds are general obligations of the
College and feature debt service reserve funds. The Series 2002
bonds are further secured by a first leasehold mortgage and
security interest in the financed facility, a residence hall on
the Shirley (Brookhaven) campus.

The College's $38.5 million of Series 2006 bonds (not rated by
Moody's) are a general obligation of the College and also have a
debt service reserve fund. They are secured by a first mortgage
lien and security interest in the College's Oakdale and Shirley
campuses and property, excluding the residential facility financed
with the Series 2002 bonds. The Series 2006 bonds have a
subordinate mortgage lien and security interest in the Series 2002
facility.

Per the Series 2006 Sublease between the College and the issuing
authority, under certain circumstances (defined as Triggering
Events in the Sublease), the College's Gross Revenues, excluding
2002 Facility Revenues pledged to the Series 2002 Trustee to
secure the principal amount of the Series 2002 Bonds, would be
directed to the Series 2006 trustee. Debt service on the Series
2006 bonds would first be paid from Gross Revenues, before other
operating costs of the College. In Moody's opinion, the Series
1996 and 2002 bonds have a weaker legal security than the Series
2006 bonds.

DEBT-RELATED RATE DERIVATIVES: None

STRENGTHS

   * Enrollment growth expected with large entering freshmen class
in fall 2008 (527 students) and increases in graduate enrollment.
Based on a re-stated calculation of undergraduate FTE, the College
had 4,399 total full-time equivalent students enrolled in fall
2007 at its 2 campuses on the southern shore of Long Island, NY.
The College is recovering from enrollment declines in recent
years, including a smaller than expected entering freshmen class
in fall 2006 (426 students) and a resulting decline in net tuition
revenue in FY 2007. New management is focused on recruitment and
retention strategies and is working with a consultant to develop
more targeted and successful use of financial aid.

   * Although the College's net tuition revenue declined 2.3% in
FY 2007 due to overall enrollment declines in fall 2006, net
tuition on a per student basis has grown in each of the past five
years. In FY 2007, the College generated $13,296 of net tuition
per student, a 16% increase over FY 2004.

   * No near-term borrowing plans, although management reports
that additional student housing is a longer-term focus.

CHALLENGES

   * Very thin liquidity and reliance on $3 million operating line
for seasonal cash flow. As of June 30, 2008 (typically the lowest
point for unrestricted cash during the fiscal year), the College
had $3.8 million of unrestricted cash and investments including a
full draw on the line of credit.

   * Weak operating performance (-5.4% operating deficit in FY
2007 due to enrollment declines in fall 2006 and a roughly -1%
deficit based on FY 2008 draft financials). Operating cash flow is
thin and provides weak coverage of annual debt service
responsibilities (0.5 times in FY 2007 and 1.1 times in FY 2008
based on draft financials).

   * Heavy reliance on student charges (over 90% of revenue base).
Stable to growing enrollment is essential to the College's credit
profile, as even a slight unexpected decline in enrollment levels,
due to either deterioration of recruitment or retention, could
result in significant operating pressure.

KEY INDICATORS (FY 2007 audited financial data and fall 2007
enrollment data)

Total Full-Time Equivalent (FTE) Enrollment: 4,399 FTE enrollment
(the College has changed its calculation of undergraduate FTE and
has reported corrected data to Moody's for prior years: fall 2005
total FTE of 4,798; fall 2006 FTE of 4,397; fall 2007 FTE of
4,399)

Total Financial Resources: $4.5 million

Total cash and investments (excluding debt service reserve funds):
$10.5 million

Direct Debt: $67.3 million

Expendable Financial Resources-to-Debt: 0.04 times

Total Financial Resources-to-Debt: 0.07 times

Expendable Financial Resources-to-Operations: 0.04 times

Three-Year Average Operating Margin: -2.4%

Operating Cash Flow Margin in FY 2007: 4%

Average Debt Service Coverage: 0.8 times

Reliance on Student Charges: 91%

RATED DEBT:

Series 1996 and 2002: B1 on watchlist for possible downgrade


DRI CORPORATION: SEC Grants Request to Exclude Information
----------------------------------------------------------
The Securities and Exchange Commission, by the Division of
Corporation Finance, has granted an application by DRI Corporation
requesting confidential treatment for information it excluded from
an exhibit to a Form 8-K/A filed on Aug. 14, 2008.

Patti J. Dennis, Chief of the SEC's Office of Disclosure Support,
has determined not to publicly disclose the information since it
qualifies as confidential commercial or financial information
under the Freedom of Information Act, 5 U.S.C. 552(b)(4).

On Aug. 14, the company delivered to the SEC copies of certain
financial documents and related exhibits.  The company wants the
copies of these documents excluded from public viewing through
August 14, 2010:

   1. Revolving Credit and Security Agreement, dated as of June
30, 2008, by and among, PNC Bank, National Association, and
Digital Recorders, Inc., TwinVision of North America, Inc. and DRI
Corporation.

   2. Loan and Security Agreement, dated as of June 30, 2008, by
and among Digital Recorders, Inc., TwinVision of North America,
Inc. and DRI Corporation, and BHC Interim Funding III, L.P.

   3. Undertaking Concerning Loan Payment -- for purposes other
than personal consumption, by and between Handelsbanken and
Mobitec AB (English translation).

Other documents filed with the SEC are:

   -- Warrant, dated as of June 30, 2008, issued by DRI
Corporation to BHC Interim Funding III, L.P.

   -- Agreement, dated as of June 30, 2008, by and between DRI
Corporation and John D. Higgins.

   -- Revolving Credit Note, dated as of June 30, 2008, issued by
Digital Recorders, Inc., TwinVision of North America, Inc. and DRI
Corporation to PNC Bank, National Association.

   -- First Amendment to the Loan and Security Agreement, dated as
of July 30, 2008, by and among Digital Recorders, Inc., TwinVision
of North America, Inc. and DRI Corporation, and BHC Interim
Funding III, L.P.

   -- Senior Secured Term Note, dated as of June 30, 2008, issued
by Digital Recorders, Inc. and TwinVision of North America, Inc.
to BHC Interim Funding III, L.P.

   -- Continuing Unconditional Guaranty, dated as of June 30,
2008, granted by DRI Corporation in favor of BHC Interim Funding
III, L.P.

   -- Stock Pledge Agreement, dated as of June 30, 2008, by and
between DRI Corporation and BHC Interim Funding III, L.P.

   -- Trademark Security Agreement, dated as of June 30, 2008, by
and between DRI Corporation and BHC Interim Funding III, L.P.

   -- Trademark Security Agreement, dated as of June 30, 2008, by
and between Digital Recorders, Inc. and BHC Interim Funding III,
L.P.

   -- Trademark Security Agreement, dated as of June 30, 2008, by
and between TwinVision of North America, Inc. and BHC Interim
Funding III, L.P.

   -- Copyright Security Agreement, dated as of June 30, 2008, by
and between Digital Recorders, Inc. and BHC Interim Funding III,
L.P.

   -- Copyright Security Agreement, dated as of June 30, 2008, by
and between TwinVision of North America, Inc. and BHC Interim
Funding III, L.P.

   -- Patent Security Agreement, dated as of June 30, 2008, by and
between Digital Recorders, Inc. and BHC Interim Funding III, L.P.

   -- Instrument for Debt A -- Loan for purposes other than
personal consumption, by and between Handelsbanken and Mobitec AB
(English translation).

   -- Factoring Agreement by and between Handelsbanken and Mobitec
AB (English translation).

   -- EURO Short Term loan Facility by and between Handelsbanken
and Mobitec GmbH.

                        About DRI Corp.

Headquartered in Dallas, Texas, DRI Corporation (Nasdaq: TBUS) --
http://www.digrec.com/-- through its business units and wholly   
owned subsidiaries, designs, manufactures, sells, and services
information technology products either directly or through
manufacturers' representatives or distributors.  DRI produces
passenger information communication products under the Talking
Bus(R), TwinVision(R), VacTell(TM) and Mobitec(R) brand names,
which are sold to transportation vehicle equipment customers
worldwide.

DRI's customers generally fall into one of two broad categories:
end-user customers or original equipment manufacturers.  DRI's
end-user customers include municipalities, regional transportation
districts, state and local departments of transportation, transit
agencies, public, private, or commercial operators of bus and van
vehicles, and rental car agencies.  DRI's OEM customers are the
manufacturers of transportation rail, bus and van vehicles.  

                      Going Concern Doubt

PricewaterhouseCoopers LLP, in Raleigh, North Carolina, expressed
substantial doubt about DRI 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 insufficient cash resources to
satisfy its debt obligations.  

As reported in the Troubled Company Reporter on July 16, 2008,
DRI Corp. entered into a revolving credit agreement with PNC Bank,
National Association on June 30, 2008.  The three-year
agreement -- a revolving credit line of up to $8 million subject
to formula-derived availability based on inventory and accounts
receivable -- replaces the company's present $6 million U.S.
senior lender relationship with Laurus Master Fund, Ltd., which
expired June 30, 2008.  This credit facility includes performance
covenants and other provisions related to payment and pre-payment,
generally considered by management to be usual and customary for
this type of financing.


DUANE READE: Weak Operating Performance Cues Moody's to Junk PDR
----------------------------------------------------------------
Moody's Investors Service downgraded Duane Reade's probability of
default rating to Caa2 from Caa1and affirmed the Caa1 corporate
family rating. In addition, Moody's lowered the company's senior
secured notes rating to Caa1 (LGD 3, 34%) from B3 (LGD 3, 37%).
The rating outlook is stable.

The downgrade of the probability of default rating reflects the
company's persistently weak operating performance, high leverage,
and weak interest coverage which creates what Moody's believes to
be an unsustainable capital structure over the medium term. As the
company's $210 million floating rate senior secured notes mature
in December 2010, Moody's believes refinancing risk continues to
grow and that the probability of default has increased and will
remain elevated until these notes are refinanced.

The company's Caa1 corporate family rating reflects the company's
geographic concentration in and disproportionate exposure to
economic conditions in the intensely competitive New York metro
market, along with persistently weak credit metrics such as high
leverage and low fixed charge coverage. The rating also
incorporates Moody's expectation that free cash flow will remain
weak over the next 12 months due to relatively weak cash flow that
is largely consumed by capital expenditures.

Given Duane Reade's strong brand recognition, significant market
position in the New York area, and recent improvement in operating
performance, Moody's believes the company's operations should
provide a higher-than-average level of recovery value in a stress
scenario. As such, Moody's used a fundamental distressed EBITDA
valuation approach (6 times multiple) to estimate loss-given-
default rather than a mean family-level LGD estimate. Based on
this approach, the company's recovery estimate increased to 60%
from 50%. The lower loss estimate resulted in the Caa1 corporate
family rating deviating from the Caa2 probability of default
rating by one notch.

The stable outlook reflects Moody's view that Duane Reade's asset
based revolving credit facility and expected cash flow should
provide sufficient liquidity over the near to intermediate term to
meet all of the company's internal requirements.

Ratings downgraded are:

Probability of default rating to Caa2 from Caa1

$210 million floating rate senior. secured notes to Caa1 (LGD 3,
34%) from B3 (LGD 3, 37%)

Ratings affirmed and LGD rates adjusted are:

Corporate family rating of Caa1

$195 million 9.75% senior subordinated notes at Caa3 (LGD 5, 72%)
from Caa3 (LGD 6, 90%)

The rating outlook is stable.

The most recent rating action on Duane Reade was the affirmation
of the company's ratings and stable outlook on April 16, 2007.

Duane Reade Inc, headquartered in New York City, operates 241
drug stores principally in Manhattan and the outer boroughs.
Revenue for the LTM period ending June 28, 2008 were approximately
$1.7 billion.


ELOY COTA: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------
Debtor: Eloy Cota
        1102 E. Jimmie Kerry Blvd.
        Casa Grande, AZ 85222

Bankruptcy Case No.: 08-13365

Chapter 11 Petition Date: September 30, 2008

Court: District of Arizona (Tucson)

Debtor's Counsel: John F. Battaile, Esq.
                  jfbattaile@abgattorneys.com
                  Altfeld Battaile & Goldman, P.C.
                  250 N. Meyer Avenue
                  Tucson, AZ 85701
                  Tel: (520) 622-7733
                  Fax: (520) 622-7967

Estimated Assets: $50 million to $100 million

Estimated Debts: $10 million to $50 million

Debtor's 20 Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
Foxworth Galbraith             Trade debt            $155,158
New Mexico
P.O. Box 7887
Ruidoso, NM 88345

SCF Arizona                    Trade debt            $115,644
P.O. Box 33049
Phoenix, AZ 85067

Great Western                  Trade debt            $112,139
3652 E. Miame
Phoenix, AZ 85040

City Of Safford                Trade debt            $96,111

Nickle Contracting             Trade debt            $75,677

Caterpillar Financial          Trade debt            $60,611

Hilton Finance                 Trade debt            $47,463

Action Equipment               Trade debt            $41,086

Trueline Engineering           Trade debt            $39,223

Fullerform Co.                 Trade debt            $31,189

Key Equipment                  Trade debt            $25,317

Curtis Landscape               Trade debt            $23,800

Fidelity National Title        Trade debt            $23,623

Foxworth Galbraith             Trade debt            $22,006
Casa Grande

Central AZ Truss               Trade debt            $18,658

Shearer Enterprises            Trade debt            $15,985

Allied Building Products       Trade debt            $14,277

Smith and Bell Concrete        Trade debt            $13,160

UT Plumbing                    Trade debt            $12,976

Southwest Redi-Mix             Trade debt            $12,587


ENERGY EXPLORATION: Changes Name to NXT Energy Solutions
--------------------------------------------------------
Energy Exploration Technologies Inc. disclosed in Securities and
Exchange Commission filing that on Sept. 22, 2008, it has changed
its name to NXT Energy Solutions Inc.   

The Company's shareholders approved the name change during the
Nov. 29, 2007, Annual General Meeting.   

"Our name-change to NXT Energy Solutions Inc. will better reflect
our principal activities and now aligns with our trade mark NXT."
states George Liszicasz CEO and President.

The trading symbol for the TSX-V shall remain unchanged.  The
Company cannot confirm at this time whether a trading symbol
change will be required for either the OTCBB or Frankfurt
exchange.

                     About Energy Exploration

Based in Calgary, Alberta, Canada, Energy Exploration Technologies
Inc. (OTC BB: ENXTF; TSX-V: SFD) -- http://www.nxtenergy.com/--    
is in the business of providing wide-area airborne exploration
services to the oil and gas industry.  The company utilizes its
proprietary Stress Field Detection Survey System to offer its
clients a unique service to rapidly identify sub-surface
structures with reservoir potential in sedimentary basins with no
environmental impact.  The value of the service is providing
clients with an efficient, cost effective method of surveying
large tracts of land and delivering an inventory of SFD prospects
with high potential.

                       Going Concern Doubt

As reported in the Troubled Company Reporter on Aug. 28, 2008,
Energy Exploration Technologies Inc. said is in the early stage of
commercializing its SFD technology.  Its ability to generate
cash flow from operations will depend on its ability to service
its existing clients and develop new clients for its SFD services.  
Management also recognizes that this early commercialization phase
can last for several years.  In addition, Energy Exploration said
that consistent with this early stage of commercialization the
company has a significant economic dependency on a few customers.

Energy Exploration Technologies Inc. believes these conditions
cast substantial doubt about its ability to continue as a
going concern.  


ENERLUME ENERGY: Mahoney Cohen Expresses Going Concern Doubt
------------------------------------------------------------
New York-based Mahoney Cohen & Company, CPA, P.C., raised
substantial doubt about the ability of EnerLume Energy Management
Corp., formerly Host America Corporation, to continue as a going
concern after it audited the company's financial statements for
the year ended June 30, 2008.  

The auditor pointed out in its report that EnerLume Energy has
suffered recurring losses from continuing operations, has negative
cash flows from operations, has a working capital and a
stockholders’ deficiency at June 30, 2008 and is currently
involved in significant litigations that can have an adverse
effect on the company’s operations.

The company incurred net losses for the years ended June 30, 2008,
and 2007 respectively, and had a working capital deficiency and
accumulated deficit of $3,210,995 and $5,426,180, respectively, as
of June 30, 2008.  The company had $4,100,498 and $5,078,769 of
cash that was used in operating activities of continuing
operations during 2008 and 2007, respectively.
         
In addition, the company is currently involved in litigation that
can have an adverse effect on its operations.  If an adverse
ruling with any or all of these legal matters occurs, the company
may be forced to make material payments, restructure operations,
sell off a significant portion of its assets or take other
necessary and appropriate matters to ensure its ability to
continue operations.  These conditions raise substantial doubt
about the company's ability to continue as a going concern.      

The management plans to improve cash flow through continued focus,
deployment and promotion of the company’s energy efficiency
segment and the underlying technology associated with its newly
designed light controller.  Management also plans to continue its
efforts to identify ways of reducing operating costs and to
increase liquidity through additional equity and debt financings
and has entered into agreements with institutional investment
firms that could provide additional equity and debt financings.  
The completion of these financings and the operational initiatives
are expected to improve the company’s cash flow and to help foster
the implementation of its current initiatives and business plan.

The company posted a net loss of $7,420,059 on net revenues of
$6,198,175 for the year ended June 30, 2008, as compared with a
net loss of $6,072,916 on net revenues of $7,194,392 in the prior
year.

At June 30, 2008, the company's balance sheet showed $2,013,366 in
total assets and $7,439,546 in total liabilities, resulting in a
$5,426,180 stockholders' deficit.  

The company's consolidated balance sheet at June 30, 2008, also
showed strained liquidity with $1,574,287 in total current assets
available to pay $4,785,282 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?332b

             Federal Class and Derivative Actions
                             
In August 2005 and September 2005, the company and certain of its
past and present officers and directors were named as defendants
in securities class action suits in the United States District
Court for the District of Connecticut, which were eventually
consolidated under the caption, In re Host America Securities
Litigation, Civil Action No. 05-cv-1250 (VLB).  A purported
shareholder derivative suit, naming the company’s board and others
as defendants, was also brought during the same period in the
federal district court and consolidated under the same caption.  
The lawsuits arose out of a press release issued by the company on
July 12, 2005, regarding its commercial relationship with Wal-Mart
Stores, Inc.  Thereafter, on May 22 and 23, 2007, the company and
its past and present directors and officers were named as
defendants in the Class and Derivative Actions, and the plaintiffs
filed agreements to settle and fully resolve all claims against
the Host America defendants in both actions.   Following a
settlement fairness hearing, on Feb. 5, 2008, the Court issued
orders granting final approval of both settlements.
         
Under the Class Action settlement, the Host America defendants
agreed to a gross payment of $2,450,000 to the Class in exchange
for dismissal of all claims against them with prejudice.  Of that
amount, $1,700,000 has been paid by insurance and the remainder by
the company.   In the Derivative Action settlement, the company
has implemented and/or maintained certain specified corporate
governance policies and procedures, and paid $140,000 funded by
insurance proceeds for the shareholder plaintiffs’ attorney fees
and costs.  The settlement amounts for both the Class and
Derivative actions have been paid in full.
         
On March 5, 2008, a putative Host America shareholder, Bart
Hester, who had earlier brought a separate derivative lawsuit in
state court, sought to intervene in the Derivative Action.  Hester
later submitted the only objection to the settlement.  Hester
filed a notice of appeal from the approval of the Derivative
Action settlement to the Court of Appeals for the Second Circuit.  
On Aug. 12, 2008, Hester and all appellees stipulated to a
dismissal of Hester’s appeal with prejudice.

As part of the settlements, the company and all other settling
defendants continue to deny any liability or wrongdoing.  Payments
under the Class and Derivative settlements exhausted the available
proceeds from the Host America defendants’ insurance policy.

                    About EnerLume Energy

Headquartered in Hamden, Conn., EnerLume Energy Management Corp.
(OTC BB: ENLU) -- http://www.enerlume.com/-- through its  
subsidiaries, provides energy management conservation products and
services in the United States.  Its focus is energy conservation,
which includes a proprietary digital microprocessor for reducing
energy consumption on lighting systems, and the installation and
design of electrical systems, energy management systems,
telecommunication networks, control panels and lighting systems.


ENVIRONMENTAL TECTONICS: AMEX Accepts Compliance Plan
-----------------------------------------------------
Environmental Tectonics Corporation disclosed in a Securities and
Exchange Commission filing that on Sept. 16, 2008, the American
Stock Exchange had accepted its Compliance Plan and agreed to
continue the listing of the Company's common stock through at
least March 16, 2009, subject to the Company attaining certain
milestones set forth.

The Plan had been submitted on July 31, 2008, in response to a
letter received from AMEX on July 2, 2008 ,stating that the
Company was not in compliance with Section 1003 of the AMEX
Company Guide.  Specifically, the Company is not in compliance
with:

   -- Section 1003(a)(i) of the AMEX Company Guide with
      stockholders' equity of less than $2,000,000 and losses from
      continuing operations and net losses in two out of its three
      most recent fiscal years;

   -- Section 1003(a)(ii) of the AMEX Company Guide with
      stockholders' equity of less than $4,000,000 and losses from
      continuing operations and net losses in three out of its
      four most recent fiscal years; and

   -- Section 1003(a)(iii) of the AMEX Company Guide with
      stockholders' equity of less than $6,000,000 and net losses
      in its five most recent fiscal years.

This non-compliance by the Company with Section 1003 of the AMEX
Company Guide made the Company's common stock subject to being
delisted from AMEX.

The Company has been granted an extension until March 16, 2009 to
regain compliance with the continued listing standards and must
meet certain milestones during that time frame.  The Company will
be subject to periodic review by AMEX Exchange Staff during the
extension period.  Failure to make progress consistent with the
Plan or to regain compliance with the continued listing standards
by the end of the extension period could result in the Company
being delisted from the AMEX.

As a consequence of falling below the continued listing standards
of the AMEX Company Guide, the Company will be included in a list
of issuers that are not in compliance with AMEX's continued
listing standards.  Additionally, an indicator will be added to
the Company's trading symbol noting the Company's non-compliance
with the continued listing standards of the AMEX Company Guide
until such time as the Company regains compliance with the
applicable listing standards.

                  About Environmental Tectonics
    
Southampton, Pennsylvania-based Environmental Tectonics
Corporation (AMEX: ETC) -- http://www.etcusa.com/-- designs,   
develops, installs and maintains aircrew training systems
(aeromedical, tactical combat and general), disaster management
training systems and services, entertainment products, sterilizers
(steam and gas), environmental testing products, hyperbaric
chambers and related products for domestic and international
customers.

At May 30, 2008, the company's consolidated balance sheet showed
$35.2 million in total assets, $36.2 million in total liabilities,
$6.0 million in Series B cumulative convertible preferred stock,
and $3.3 million in Series C cumulative convertible participating  
preferred stock, resulting in a $10.4 million stockholders'
deficit.
    
The company had a net loss of $1.5 million during the first
quarter of fiscal 2009 compared to a net loss of $5.7 million for
the first quarter of fiscal 2008.  The company attributed the
decrease in net loss to a significant increase in sales and
corresponding gross profit and reduced claim settlement costs,
attributable to claims costs associated with a U.S. Navy
settlement.  Acting as partial offsets were higher research and
development expenses and interest expenses.


EXTERRA ENERGY: Going Concern Status in Doubt After Losses
----------------------------------------------------------
In its report on Sept. 12, 2008, Houston-based Malone & Bailey PC
raised substantial doubt about the ability of Exterra Energy,
Inc., to continue as a going concern after it audited the
company's financial statements for the year ended May 31, 2008.  
The auditor pointed to the company's incurred losses since
inception.

                       Company Statement

The company has not yet established an ongoing source of revenues
sufficient to cover its operating costs and has defaulted on
certain outstanding notes payable. To continue as a going concern,
the company is dependent on its obtaining adequate capital to fund
operating losses until it becomes profitable and to settle or
restructure its outstanding past due notes payable.  If the
company is unable to obtain adequate capital, it could be forced
to cease operations.

In order to continue as a going concern, the company will need,
among other things, additional capital resources.  Management's
plans to obtain these resources for the company include:

(1) obtaining capital from management and significant
    shareholders sufficient to meet its minimal operating
    expenses, and

(2) seeking out and completing a merger with an existing
    operating company.

However, management cannot provide any assurances that the company
will be successful in accomplishing any of its plans.

                           Financials

The ability of the company to continue as a going concern is
dependent upon its ability to successfully accomplish its plans
and eventually secure other sources of financing and attain
profitable operations.

The company posted a net loss of $8,807,745 on total oil and gas
sales of $1,192,253 for the year ended May 31, 2008, as compared
with a net loss of $619,156 on total oil and gas sales of $50,578
in the prior year.

At May 31, 2008, the company's balance sheet showed $17,101,544 in
total assets, $7,918,684 in total liabilities, and $9,182,860 in
total stockholders' equity.  

The company's consolidated balance sheet at May 31, 2008, showed
strained liquidity with $315,624 in total current assets available
to pay $7,704,024 in total current liabilities.

                      Notes Payable

The company's debts outstanding at May 31, 2008, are:

  Note payable to purchase oil and gas properties  $ 200,000
  Note payable to finance insurance premium            7,609
  Note payable to Coventry Capital, net of discount  462,125
  Convertible loans                                  367,500
                                                  ----------
                                    Total debts   $1,037,234

A full-text copy of the company's 2008 annual report is available
for free at http://ResearchArchives.com/t/s?3328

                      About Exterra Energy

Exterra Energy, Inc. (OTC BB: EENR.OB) --
http://www.exterraenergyinc.com-- engages in the exploration and  
production of oil and natural gas properties in Texas.  As of May
31, 2008, it had total proved reserves of 28,690 barrels of oil
and condensate, and 6.777 billion cubic feet of natural gas.  The
company, formerly known as Green Gold Incorporated, was founded in
2006 and is headquartered in Houston.


FANNIE MAE: Wants Banks to Speed Up Mortgage Payment Transfers
--------------------------------------------------------------
James R. Hagerty at The Wall Street Journal reports that Fannie
Mae is requiring some banks to speed up transfers of mortgage
payments to investors.  WSJ relates that mortgage-bond holders
could face losses if the loan payments were kept at a failed bank.

Several banks said on Friday that Fannie Mae told them that they
must remit daily, instead of monthly interest and principal
payments on mortgage loans that are destined for owners of
mortgage-backed securities, WSJ relates, citing Scott Talbott --
chief lobbyist for the Financial Services Roundtable, a trade
group representing financial-services companies.  WSJ states that
Fannie Mae guarantees such securities, which are backed by pools
of home mortgages sold to investors.

The move applies only to "certain" banks, WSJ says, citing Fannie
Mae spokesperson Brian Faith, who didn't identify the banks
affected.  WSJ relates that the move adds administrative costs and
reduces interest income at the banks that collect payments on the
loans.

WSJ quoted Mr. Faith as saying, "The funds in question are
collected on behalf of us for the (mortgage-backed security)
owners, to whom we have a fiduciary responsibility.  Collecting on
a daily basis and placing the funds in a trust is a safer option
than holding the funds in deposit accounts that have an insurance
ceiling"  and banks will be compensated for their earlier-than-
normal remittance of the funds.

                         About Fannie Mae

The Federal National Mortgage Association -- (FNMA) (NYSE: FNM) --
commonly known as Fannie Mae, is a shareholder-owned U.S.
government-sponsored enterprise.  Fannie Mae has a federal charter
and operates in America's secondary mortgage market, providing
mortgage bankers and other lenders funds to lend to home buyers at
low rates.

Fannie Mae was created in 1938, under President Franklin D.
Roosevelt, at a time when millions of families could not become
homeowners, or risked losing their homes, for lack of a consistent
supply of mortgage funds across America.  The government
established Fannie Mae to expand the flow of mortgage funds in all
communities, at all times, under all economic conditions, and to
help lower the costs to buy a home.

In 1968, Fannie Mae was re-chartered by the U.S. Congress as a
shareholder-owned company, funded solely with private capital
raised from investors on Wall Street and around the world.

Fannie Mae is the U.S. largest mortgage buyer, according to The
New York Times.


FANNIE MAE: Prosecutors Ask Firm for Financial Information
----------------------------------------------------------
Evan Perez at The Wall Street Journal reported that Fannie Mae and
Freddie Mac said they received "grand jury subpoenas" from federal
prosecutors of the U.S. Attorney for New York's southern district,
asking the companies for information on their accounting,
disclosures, and corporate governance matters for the period
Jan. 1, 2007 to the present.

WSJ said the U.S. Securities and Exchange Commission is currently
investigating Fannie Mae and Freddie Mac.  According to WSJ, the
two firms have been in the conservatorship of their regulator, the
Federal Housing Finance Agency, since the government confiscated
their assets.  WSJ said the government intervention has raised
pressure on the government to hold accountable the firms and their
top executives.

Fannie Mae said that it had received "a request for preservation
of documents related to the inquiry from the Staff of the SEC,"
and that it expects the SEC to issue a request for documents, WSJ
stated.  Fannie Mae and Freddie Mac said they will fully cooperate
with the investigations and inquiries, the report says.

The investigation, according to WSJ, is part of a wider move by
the federal law enforcement to find out the cause of the financial
troubles affecting the Wall Street and the housing market.

                        About Freddie Mac

The Federal Home Loan Mortgage Corporation -- (FHLMC) NYSE: FRE --
commonly known as Freddie Mac, is a stockholder-owned government-
sponsored enterprise authorized to make loans and loan guarantees.  
Freddie Mac was created in 1970 to provide a continuous and low
cost source of credit to finance America's housing.

Freddie Mac conducts its business primarily by buying mortgages
from lenders, packaging the mortgages into securities and selling
the securities -- guaranteed by Freddie Mac -- to investors.  
Mortgage lenders use the proceeds from selling loans to Freddie
Mac to fund new mortgages, constantly replenishing the pool of
funds available for lending to homebuyers and apartment owners.

                         About Fannie Mae

The Federal National Mortgage Association -- (FNMA) (NYSE: FNM) --
commonly known as Fannie Mae, is a shareholder-owned U.S.
government-sponsored enterprise.  Fannie Mae has a federal charter
and operates in America's secondary mortgage market, providing
mortgage bankers and other lenders funds to lend to home buyers at
low rates.

Fannie Mae was created in 1938, under President Franklin D.
Roosevelt, at a time when millions of families could not become
homeowners, or risked losing their homes, for lack of a consistent
supply of mortgage funds across America.  The government
established Fannie Mae to expand the flow of mortgage funds in all
communities, at all times, under all economic conditions, and to
help lower the costs to buy a home.

In 1968, Fannie Mae was re-chartered by the U.S. Congress as a
shareholder-owned company, funded solely with private capital
raised from investors on Wall Street and around the world.

Fannie Mae is the U.S. largest mortgage buyer, according to The
New York Times.


FIREPOND INC: Losses Cue Auditor to Raise Going Concern Doubt
-------------------------------------------------------------
On Sept. 25, 2008, Denver-based Causey Demgen & Moore, Inc.,
raised substantial doubt about Firepond, Inc.'s ability to
continue as a going concern after it audited the company's
financial statements for the year ended June 30, 2008.  The
auditor reported that the company has suffered recurring losses
from operations.

The company has, for some time, been incurring losses and negative
cash flow from operations.  For the fiscal year ended June 30,
2008, the company incurred a net loss of around $14,400,000 and
negative cash flows from operations of around $4,900,000.  
Moreover, while demand for the company's OnDemand, multi-tenant,
subscription based software, applications seems to be growing, it
is not clear at this point that future operational cash flow will
be sufficient to sustain present operations without continuous
sales growth over the next 12 months.  In the absence of such
sales growth, the company is, therefore, likely to require
additional capital either in the form of new debt or equity
infusions.

In the past, the company has been successful in completing
numerous rounds of financing, including the sale of $1,500,000 of
its common stock in April 2008 and subsequent to June 30, 2008,
transacted an additional sale of $500,000 of its common stock.  
However, no assurances can be given that additional financing will
be available, if required, in which case, the company's ability to
achieve its business objectives may be adversely affected.

The company posted a net loss of $14,353,663 on total revenues of
$4,703,943 for the year ended June 30, 2008, as compared with a
net loss of $23,270,137 on total revenues of $4,624,763 in the
prior year.

At June 30, 2008, the company's balance sheet showed $2,467,387 in
total assets and $10,284,613 in total liabilities, resulting in a
$7,817,226 stockholders' deficit.  

The company's consolidated balance sheet at June 30, 2008, also
showed strained liquidity with $1,644,270 in total current assets
available to pay $3,514,723 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?332a

                        About Firepond

Firepond Inc. -- http://www.firepond.com/company/-- provides   
multi-tenant, on-demand software that automates and simplifies the
process companies use to sell complex products and services.  Its
Configure, Price, Quote, or CPQ, software-as-a-service automates
sales processes, improves order accuracy, and accelerates sales
cycles.  The company designed its CPQ product to be a low-cost
Internet-based software application delivered on a subscription
basis.


FOAMEX LP: Housing, Auto Sector Woes Cue Moody's to Junk Ratings
----------------------------------------------------------------
Moody's Investors Service downgraded these ratings of Foamex L.P.
-- corporate family rating to Caa1 from B2, probability of default
to Caa1 from B2, first lien senior secured term loan to Caa1 from
B2; second lien rating to Caa2 from Caa1. The rating outlook
remains negative.

The downgrade to Caa1 reflects the economic pressures that Foamex
L.P. faces due to the continued downturn in the domestic housing
and automotive sectors, the main drivers of its revenues.
Furthermore, operating performance and cash generation continue to
perform below Moody's expectations. Even though the company has
completed about $146 million of debt for equity exchanges,
primarily reflecting the support from D.E. Shaw Laminar Portfolios
L.L.C., the negative trend in operating performance is expected to
result in future credit metrics more commensurate with the lower
rating. This deterioration in Foamex L.P.'s performance will
likely result in the need for some financial covenant relief under
the bank credit facilities as the financial covenant levels become
more restrictive beginning with 4Q08 in order to maintain access
to the company's revolving credit facility. Moody's anticipates
that D.E. Shaw will make up any shortfalls enabling Foamex L.P. to
be in compliance with its financial covenant tests.

These ratings/assessments were affected by this action:

Corporate family rating downgraded to Caa1 from B2;

Probability of default rating downgraded to Caa1 from B2;

$327 million first lien senior secured term loan due 2013
downgraded to Caa1 (LGD4, 53%) from B2 (LGD4, 52%); and,

$47 million second lien senior secured term loan due 2014
downgraded to Caa2 (LGD5, 83%) from Caa1 (LGD5, 81%).

The last rating action was on August 21, 2008 at which time
Moody's changed Foamex L.P.'s outlook to negative from stable.

Foamex International Inc., headquartered in Media, PA and
operating primarily through its wholly-owned subsidiary Foamex
L.P., is a leading manufacturer and distributor of flexible
polyurethane and advanced polymer foam products. Last 12 months
June 29, 2008 revenues were approximately $1.0 billion.


FORD MOTOR: Repays $1.5BB in Debt, Faces 3 Payment Obligations
--------------------------------------------------------------
Jeff Green at Bloomberg News reports that Ford Motor Co. said it
repaid $1.5 billion in debt that was due Oct. 1, 2008.

As reported in the Troubled Company Reporter on Oct. 1, 2008,
analysts said that Ford Motor might repay the debt without tapping
a $11.5 billion revolving credit line, which it secured as part of
its 2006 restructuring.  The $1.5 billion debt includes:

     -- $1 billion in five-year, unsecured bonds at the Ford
        Motor Credit Co. consumer-finance unit, which has a
        coupon interest rate of 5.625%, and was part of a
        September 2003 sale of $3 billion in 5- and 10-year
        notes; and

     -- $500 million in 12-year notes at Ford, which was "sold
        in 1996 and has an interest rate of 7.25%."

Bloomberg News relates that Ford Motor spokesperson Bill Collins
said in an interview that the payments were made in a "routine
transaction."

"It means they paid with cash.  If they had tapped their revolver,
they would have had to file something because it's material, and
we would know if they had come to market for new debt," Bloomberg
quoted Morgan Keegan & Co. fixed-income analyst Pete Hastings as
saying.

Bloomberg News states that Standard & Poor's credit analyst Robert
Schulz said in an interview, "They have sufficient cash and
liquidity for this transaction."

According to data obtained from Bloomberg, Ford Motor faces three
more major payment obligations:

   -- $4.3 billion due on Jan. 12, 2009;
   -- $1.5 billion due on May 22, 2009; and
   -- $5.0 billion due on Oct. 28, 2009

             Government's $25 Billion Bailout Loans

Heidi M. Moore at The Wall Street Journal relates that President
George W. Bush signed on Sept. 30, 2008, a
$25 billion in bailout loans to help automakers produce more fuel-
efficient vehicles.  According to Ms. Moore, automakers can secure
the loans at about half the going market rate.  Ford Motor, along
with Chrysler LLC and General Motors won't have to repay the loans
for five years, Ms. Moore states.

According to Mike Ramsey and Alan Ohnsman at Bloomberg News, Ford
Motor's car and truck sales dropped 35% to 120,788 in September
2008, compared to 184,612 in September 2007, as tighter credit
scared off consumers.

Alex Ortolani at Bloomberg News relates that Ford Motor it told
its 2,000 suppliers to understand "what they're doing inside their
operations that could be funded" and figure out what programs
would make them eligible for part of the $25 billion loans.  

According to Bloomberg News, Ford Motor sees the loans as a chance
to strengthen a supply base that has suffered this year due to low
auto sales, high raw-material costs, and a tight credit market.

                      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.


FREDDIE MAC: Three Executives Leave Firm
----------------------------------------
James R. Hagerty at The Wall Street Journal reports that Patricia
Cook, Freddie Mac's chief business officer; Buddy Piszel, its
chief financial officer; and Timothy J. McBride, a senior lobbyist
have left the company.

According to WSJ, Ms. Cook's postition at Freddie Mac was
eliminated as part of a reorganization under which the heads of
business lines will report directly to CEO David Moffett.  Mr.
McBride's position was eradicated because the regulator, the
Federal Housing Finance Agency, has told Freddie, along with
Fannie Mae, to stop all lobbying, WSJ says.  The report states
that Freddie said it will look for a new CFO to succeed Mr.
Piszel.

WSJ relates that FHFA and senior executives are trying to
determine within a few weeks to what extent Freddie and Fannie can
reduce fees they added over the past year to protect against the
growing risks of lending.

Rep. Maxine Waters, a California Democrat, said during a House
Financial Services Committee hearing on Thursday that Congress
will have to think carefully about how to structure Freddie and
Fannie in the future, WSJ reports.  "Clearly, the word 'quasi' is
an adjective that should probably not be applicable to the new
structure," WSJ quoted Ms. Waters as saying.

                        About Freddie Mac

The Federal Home Loan Mortgage Corporation -- (FHLMC) NYSE: FRE --
commonly known as Freddie Mac, is a stockholder-owned government-
sponsored enterprise authorized to make loans and loan guarantees.  
Freddie Mac was created in 1970 to provide a continuous and low
cost source of credit to finance America's housing.

Freddie Mac conducts its business primarily by buying mortgages
from lenders, packaging the mortgages into securities and selling
the securities -- guaranteed by Freddie Mac -- to investors.  
Mortgage lenders use the proceeds from selling loans to Freddie
Mac to fund new mortgages, constantly replenishing the pool of
funds available for lending to homebuyers and apartment owners.


FREDDIE MAC: Prosecutors Ask Firm for Financial Information
-----------------------------------------------------------
Evan Perez at The Wall Street Journal reported that Fannie Mae and
Freddie Mac said they received "grand jury subpoenas" from federal
prosecutors of the U.S. Attorney for New York's southern district,
asking the companies for information on their accounting,
disclosures, and corporate governance matters for the period
Jan. 1, 2007 to the present.

WSJ said the U.S. Securities and Exchange Commission is currently
investigating Fannie Mae and Freddie Mac.  According to WSJ, the
two firms have been in the conservatorship of their regulator, the
Federal Housing Finance Agency, since the government confiscated
their assets.  WSJ said the government intervention has raised
pressure on the government to hold accountable the firms and their
top executives.

Fannie Mae said that it had received "a request for preservation
of documents related to the inquiry from the Staff of the SEC,"
and that it expects the SEC to issue a request for documents, WSJ
stated.  Fannie Mae and Freddie Mac said they will fully cooperate
with the investigations and inquiries, the report says.

The investigation, according to WSJ, is part of a wider move by
the federal law enforcement to find out the cause of the financial
troubles affecting the Wall Street and the housing market.

                         About Fannie Mae

The Federal National Mortgage Association -- (FNMA) (NYSE: FNM) --
commonly known as Fannie Mae, is a shareholder-owned U.S.
government-sponsored enterprise.  Fannie Mae has a federal charter
and operates in America's secondary mortgage market, providing
mortgage bankers and other lenders funds to lend to home buyers at
low rates.

Fannie Mae was created in 1938, under President Franklin D.
Roosevelt, at a time when millions of families could not become
homeowners, or risked losing their homes, for lack of a consistent
supply of mortgage funds across America.  The government
established Fannie Mae to expand the flow of mortgage funds in all
communities, at all times, under all economic conditions, and to
help lower the costs to buy a home.

In 1968, Fannie Mae was re-chartered by the U.S. Congress as a
shareholder-owned company, funded solely with private capital
raised from investors on Wall Street and around the world.

Fannie Mae is the U.S. largest mortgage buyer, according to The
New York Times.

                        About Freddie Mac

The Federal Home Loan Mortgage Corporation -- (FHLMC) NYSE: FRE --
commonly known as Freddie Mac, is a stockholder-owned government-
sponsored enterprise authorized to make loans and loan guarantees.  
Freddie Mac was created in 1970 to provide a continuous and low
cost source of credit to finance America's housing.

Freddie Mac conducts its business primarily by buying mortgages
from lenders, packaging the mortgages into securities and selling
the securities -- guaranteed by Freddie Mac -- to investors.  
Mortgage lenders use the proceeds from selling loans to Freddie
Mac to fund new mortgages, constantly replenishing the pool of
funds available for lending to homebuyers and apartment owners.


GANNETT CO: Taps Credit Line to Repay Commercial Paper
------------------------------------------------------
Sarah Rabil of Bloomberg News reports that Gannett Co. said it
drew on a revolving credit line to ensure it has funds to repay
its commercial paper.

The action was taken in response to credit-market disruption,
Gannett said in a statement on Oct. 1, 2008, according to the
report.  The company said it has significant credit available
under a $3.9 billion revolving credit line, in excess of its
$2 billion in commercial paper outstanding, according to the
report.

                            Debt Rating

Standard & Poor's said on Oct. 1 it may lower Gannett's BBB+
corporate credit rating, the eighth-highest investment grade,
and its A-2 commercial paper rating, according to the report.  The
ratings company cited the worsening decline in newspaper
advertising, according to the report.

Gannett's print advertising sales plunged 16.8 percent in August,
the biggest monthly drop this year, as classifieds continued to
dry up, according to the report.  Total revenue fell 9.5 percent,
according to the report.

Gannett said its decision to draw on its revolving credit facility
"was taken prior to -- and was completely unrelated to," S&P
putting the company on watch for a downgrade, according to the
report.

In an interview by Bloomberg, Jake Newman, a media analyst at
CreditSights Inc. in New York, said that commercial paper "is very
sensitive to funding difficulties among banks."  If Gannett
couldn't refinance commercial paper, it was probably because the
market had shut down, he said according to the interview.

"The other thing that Gannett may be thinking here is it's just
gotten too expensive," said Newman, who rates Gannett's
debt "overweight," according to the interview.

Companies are turning to their credit lines, in part, because the
failure of Lehman Brothers Holdings Inc. is fueling concern that
they may not be able to obtain funds, according to the report.  
Banks hobbled by $521 billion of writedowns and losses since the
credit crunch began in July 2007 are having to come up with funds
to meet revolving loan agreements, according to the report.

                      About Gannett Co. Inc.
   
Headquartered in McLean, Virginia, Gannett Co. Inc. (NYSE:GCI) --
http://www.gannett.com/-- is an international news and   
information company.  In the United States, the company publishes
85 daily newspapers, including USA TODAY, and nearly 900 non-daily
publications.  Along with each of its daily newspapers, the
company operates Websites offering news, information and
advertising that is customized for the market served and
integrated with its publishing operations.  Newspaper publishing
operations in the United Kingdom, operating as Newsquest, include
17 paid-for daily newspapers, almost 300 non-daily publications,
locally integrated Websites and classified business Websites with
national reach.  The company has two segments: newspaper
publishing and broadcasting.


GENERAL MOTORS: Delphi Services & Restructuring Deals Approved
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York on  
Sept. 26, 2008, entered an order approving the amendments to the
Global Services Agreement and the Master Restructuring Agreement
between General Motors Corp. and Delphi Corporation.

A full-text copy of the Amended GSA and MRA is available for free
at http://ResearchArchives.com/t/s?3330

Delphi obtained approval of their new deals with General Motors
after the Official Committee of Unsecured Creditors agreed to
withdraw its objections.

                PBGC, et al., Support New GM Deal

Various parties-in-interest, including the Fiduciary Counselors,  
Inc., and the Pension Benefit Guaranty Corp., have conveyed their
support for the amendments to GSA and MRA.

Fiduciary Counselors, Inc., the appointed fiduciary charged to
assure that the Debtors fulfill their obligations with respect to
required contributions to their Hourly-Rate Pension Plan,
believes that the latest amendments would aid the Debtors' exit
from bankruptcy.  FCI filed a proofs of claim on the HRP's behalf
for legally required contributions owed to the HRP.  The Claim
amount through Dec. 31, 2007, was identified as $2,600,000,000.  
FCI has recently conferred with the HRP's actuaries and confirmed
that the amount required to meet the statutory minimum funding
requirements for the HRP as of Sept. 30, 2008, will be in an
amount ranging from $2,100,000,000 to $2,300,000,000.

William H. Schorling, Esq., at Buchanan Ingersoll & Rooney PC, in
New York, noted that GM and Delphi have obtained a private letter
ruling from the U.S. Internal Revenue Service that the proposed
414(l) Transfer pursuant to the Amended GSA and MRA will
eliminate Delphi's obligations for all contributions due on or
before Sept. 30, 2008.  Effectuating the 414(l) Transfer will
substantially satisfy HRP's Claim -- HRP will also still have
claims for any unpaid amounts due in the future -- making the
Debtors' emergence from chapter 11 more viable, Mr. Schorling
stated.  He added that implementing the 414(l) Transfer will
avoid application of the provisions of the Pension Protection Act
to the unfunded HRP obligations, again aiding the Debtors' exit
from bankruptcy.  Finally, the 414(l) Transfer, according to
Mr. Schorling, should mitigate the risk that the PBGC would take
steps to terminate the HRP.

Representing the Pension Benefit Guarantee Corporation, John A.
Menke, Esq., avers that the amended GSA and MRA constitute an
overwhelmingly positive solution to some of the Debtors' major
pension obligations and eliminates what might be insurmountable
obstacles to a successful reorganization.  If the 414(l) transfer
occurs by Sept. 29, 2008, major benefits flow to the Debtors,
certain non-Debtor affiliates and the unsecured creditors.  
Approval of the new deal, according to Mr. Menke, will relieve
the Debtors of billions of dollars of current liability for
contributions that would otherwise be due to their Hourly Plan
and that would have to be satisfied, probably in Cash lump sum,
before the Debtors could emerge.  Because Delphi's existing
liability for contributions to the hourly Plan will be erased by
the 414(l) Transfer, as soon ass possible after the first
transfer date, the PBGC said it will relinquish more than
$1,200,000,000 in liens filed against Delphi's foreign non-Debtor
affiliates.

The Official Committee of Equity Shareholders also said it is not
objecting to the new GM/Delphi deal.  However, it reserved its
right to object to the confirmation of any Chapter 11 plan filed
and any modification in the Debtors' Chapter 11 cases.  It sought
to keep its right to object to confirmation of any chapter 11
plan that does not provide appropriate value to existing equity
in exchange for the releases granted in favor of GM.

      Splinter Unions Wary of Fate of Employees and Retirees

The IUOE, IBEW and IAM -- the Splinter Unions -- informed Judge
Drain that they are fully cognizant of the external constraints
of Delphi, and that they do not object to the conceptual
framework underlying the Motion. However, the Splinter Unions
said they are not yet in a position to assess how the proposed
implementation of the amendments to the GSA and MRA will affect
the employees and retirees represented by the Splinter Unions.

The Splinter Unions say they fully expect the Debtor and GM to
provide the answers they need to be able to negotiate a timely
implementation agreement so that the employees and retirees they
represent are fairly treated.

The Splinter Unions are represented by:

     Barbara S. Mehlsack, Esq.,
     Gorlick Kravitz & Listhaus, P.C.,
     17 State Street
     New York, N.Y. 1004
     bmehlsack@gkllaw.com

                    Parties Object to New Deal  

(a) Senior Noteholders

CR Intrinsic Investors, LLC, and Highland Capital Management,
L.P., which collectively hold approximately $495,000,000 in
principal amount of Delphi senior notes, noted that Debtors are
seeking approval of the "most important and far-reaching
settlement in this case and the fixing of central elements of a
plan of reorganization", on just 10 days' notice, without
providing the most basic information necessary for the Court to
evaluate the claims to be settled, and without any pretense of
adhering to the fundamental protections to which creditors are
entitled in connection with a plan of reorganization.

CR Intrinsic and Highland consequently asked the Court to deny
Delphi the authority to implement the amended GSA and MRA in
order to prevent the Debtors from entering into sweeping and far-
reaching agreements with GM that would irrevocably impact the
outcome of the chapter 11 cases and in effect dictate the terms
of any plan of reorganization.

Isaac M. Pachulski, Esq., at Stutman, Treister & Glatt P.C., in
Los Angeles, California, averred that Delphi is seeking approval
of what amounts to a sub rosa plan of reorganization, without
providing the kind of disclosure and procedural and substantive
protection to which creditors are entitled in connection with the
confirmation of a plan, and without any creditor vote.  According
to Mr. Pachulski, a sampling of just some of the provisions of
the Amended GSA highlights how pervasively these agreements will
dictate the terms of any plan and the ultimate outcome of the
Chapter 11 cases:

   (1) the Amended GSA includes comprehensive provisions for the
       allowance and treatment of GM's claims under any plan of
       reorganization.  Among other things,

        -- GM agrees to assume certain pension liability which
           is primarily rooted in prepetition services of
           employees who worked for GM at the time of the Delphi
           spin-off in exchange for an administrative claim.  Not
           only does an administrative claim entitle GM to
           priority payment but it also handcuffs the Debtors in
           treating this claim under a plan of reorganization.

        -- the Amended GSA also contemplates that GM would be
           entitled to an unsecured claim in the amount of
           $2,500,000,000.  While GM would not be entitled to any
           recovery on the GM Unsecured Claim until other
           unsecured creditors receive at least a 20% recovery,
           both the GM Unsecured Claim and GM Admin. Claim would
           be entitled to specified, and special, treatment under
           any plan of reorganization pursuant to the Amended
           GSA.

        -- Distributions on account of the GM Claims are to be
           made by issuing preferred stock to GM which is not
           made available to any other constituent body of the
           Debtors, and the value of which remaining unknown.

   (2) The Amended GSA contemplates that the Debtors and
       their affiliates immediately release substantially all of
       their claims against GM and its affiliates on the
       effective date of the Amended GSA and reaffirm this
       release as of the date that the Debtors emerge from
       chapter 11.  The Amended GSA also requires that any
       future plan of reorganization provide that certain third
       parties, including the Creditors Committee, the Equity
       Committee, the DIP Agent, and the DIP Lenders, among
       others, release GM and its affiliates of substantially all
       of their claims against GM and its affiliates as of the
       Emergence Date.

   (3) The Amended GSA and Amended MRA leave little doubt that
       these agreements are to control and dictate the terms of
       any future plan of reorganization.  Specifically, the
       Amended GSA requires that any Delphi Plan contain
       provisions "clarifying that to the extent of any
       inconsistency between the terms of the Delphi Plan and
       [the Amended GSA] (solely as to the subject matters        
       addressed in [the Amended GSA]), the terms of [the Amended
       GSA] will govern."

(b) Indenture Trustee to Senior Notes

Wilmington Trust Company, indenture trustee for $2,000,000,000 in
Delphi senior notes and debentures, asked the Court to deny the
Debtors' motion to implement the amended GSA and MRA.

Edward M. Fox, Esq., at K&L Gates LLP, in New York, said Delphi
is seeking an unauthorized modification of the Debtors' confirmed
Plan of Reorganization, opposing Section 1127 of the Bankruptcy
Code, which not only applies to proposed modifications of actual
plan language, but also to proposed modifications of plan-related
documents, particularly where the documents [were] an integral
part of the reorganization plan and confirmation order.

Pursuant to Section 1127(b), the proponent of a plan or the
reorganized debtor may modify the plan at any time after
confirmation of the plan and before substantial consummation of
the Plan...  The Plan as modified under the this subsection
becomes the Plan only if the circumstances warrant the
modification and the court, after notice and a hearing, confirms
the plan as modified, under Section 1129.

Mr. Fox also related that the GSA and MRA may not be amended
without the approval of the Creditors Committee, as provided for
in Section 12.2 of the Plan.  He added that the Debtors' proposal
to grant a general release to GM at this time is contrary to the
best interests of creditors, particularly since the Debtors may
well need additional assistance and support from GM in order to
consummate a plan of reorganization and emerge from bankruptcy.

(c) Creditors Committee

The Official Committee of Unsecured Creditors also asked the
Court to deny the Motion, citing that the immediate release
granted to GM and the size of the allowed administrative expense
claim to GM violate Section 1127 of the Bankruptcy Code, as the
original GSA and MRA were exhibits to the Debtors' confirmed
Chapter 11 plan.

Robert J. Rosenberg, Esq., at Latham & Watkins LLP, in New York,
said that if the proposed amendments to the GSA and the MRA are
approved, it will provide GM with extra ordinary consideration in
exchange for GM entering into transactions that are tremendously
beneficial to GM on its own.  These agreements represent no less
than the complete abdication by the Debtors of all control over
their destiny, without regard to the consequence to their
unsecured creditors, Mr. Rosenberg explained.

                   Delphi Addresses Objections

John Wm. Butler, Jr., Esq., at Skadden, Arps, Slate, Meagher &
Flom LLP, in Chicago, Illinois, noted that although certain
parties allege that the Debtors are requesting relief that is
not in the best interests of the estates and in breach of their
fiduciary duties, only these parties filed objections that remain
unresolved:

    -- the International Union of Electronic, Electrical,
       Salaried, Machine and Furniture Workers-Communication
       Workers of America and the United Steelworkers of America,
       which are continuing to collectively bargain  
       implementation agreements with Delphi which would include        
       their consent to Amended GSA and MRA

    -- the official committee of unsecured creditors; Wilmington
       Trust Company, a member of the Creditors Committee; and CR
       Intrinsic and Highland, whose interests are represented by
       both the Creditors Committee and WTC.

The Debtors furnished a chart summarizing their responses to
objections, a copy of which is available for free at   
http://ResearchArchives.com/t/s?332f

The Debtors pointed out that their largest union, the United Auto
Workers, is not opposing to the Amended GSA and MRA.  They added
that the Equity Committee, Fiduciary Counselors, the PBGC, and
three unions have conveyed support or no objections.

Contrary to the assertions of the Creditors Committee, the
Amended GSA and MRA are the product of months of intense, arm's-
length bargaining between the Debtors and GM during which the
Debtors clearly considered various alternatives and options to
the Amended GSA and the Amended MRA, Mr. Butler clarified.

Mr. Butler recounted that when Appaloosa Management, L.P., and
the other Plan Investors failed to participate in the April 4,
2008 closing, Delphi's Board of Directors convened the first of
nine meetings that would be held between that date and the
Board's ultimate approval of the Amended GSA and MRA on Sept. 12.  
The Debtors also met with the Creditors Committee and held
discussions with GM about a modified plan of reorganization
framework involving a stand-alone plan to be funded internally
through adjustments to the recoveries of GM, general unsecured
creditors, and other stakeholders.  Those discussions concluded
on June 25, when GM informed Delphi that it was not willing to
provide the level of incremental financial support that would
have been necessary to make a standalone plan of reorganization
framework possible under the RPOR as it existed at that time.

Promptly after learning of GM's decision, Delphi began a process
of identifying and assessing a range of specific strategic
alternatives that included POR modifications providing for debt
financing and equity financing through a rights offering
backstopped by creditors or other potential investors.  In
addition, in mid-July 2008, Delphi and GM re-engaged in
constructive discussions that addressed, among other things, the
incremental financial support needed to make the revised POR a
realistic business plan that should attract interest in the
capital markets.  These efforts have resulted in a number of
significant developments since April 2008, all of them
accomplished against the backdrop of deteriorating macroeconomic
and automotive industry conditions and turbulence in the capital
markets, Mr. Butler detailed.

Throughout this process, Delphi's senior leadership acted with
diligence and in accordance with its fiduciary duty to maximize
the business enterprise value of Delphi and its affiliates and
thereby maximize the opportunities for recoveries by the Debtors'
stakeholders.  In doing so, Delphi, according to Mr. Butler,
considered the Creditors Committee's demand that the Debtors play
a high-stakes game of "chicken" with GM up through the 414(l)
Transfer deadline of Sept. 29, 2008, in the hopes that GM would
eventually agree to what the Creditors Committee was really
seeking --- a form of guaranteed recovery for general unsecured
creditors from GM.  Delphi ultimately rejected that approach
because it believed that obtaining GM's commitment to take on an
upsized 414(l) Transfer, assume prompt financial responsibility
for other post-employment benefits, and provide what the Debtors
concluded was the additional required support for the RPOR was,
on balance, more beneficial to the Debtors and their stakeholders
than holding out for more at the risk of losing everything.

Although the Creditors' Panel may not agree with their decisions
for failing to initiate litigation or use other "tools" against
GM, the Debtors believe that their decisions since April 4 are
sound.  Mr. Butler avers that both the timeline of events and the
breadth of support GM is providing through the Amended GSA and
the Amended MRA demonstrate that the Debtors did not "surrender"
or abdicate control of these cases to GM.  The Debtors firmly
believe that the Amended GSA and MRA are in the best interests of
the estates, and that entry into the agreements is fundamentally
necessary for any meaningful recovery to stakeholders.

         Creditors Committee Renews Support for GM/Delphi

Delphi creditors have concurred to proposed amendments to
agreements between the auto-parts maker and its former parent
General Motors Corp., removing one hindrance to Delphi's exit
from bankruptcy after almost three years, Bloomberg News reports.

Judge Drain approved the Amended GSA and MRA after Delphi reached
a deal with the Creditors Committee.  Mr. Butler, Delphi's
counsel, told the Court at the Sept. 25 hearing that the
Creditors Committee tentatively agreed to amendments that would
change how creditors are paid in the company's restructuring as
well as the terms of preferred stock GM would receive under an
amended POR.

The hearing was originally scheduled for Sept. 23, but was
adjourned for two days to allow the Debtors and the Creditors
Committee to reach common ground.

The Creditors Committee's counsel, Robert J. Rosenberg, Esq., at
Latham & Watkins LLP, in New York, confirmed the deal.  "All's
well that ends well," Mr. Rosenberg, after retracting the
Committee's objection to the new GM deals, which would allow
Delphi to exit bankruptcy.

"Today was a major milestone in these Chapter 11 cases,"
Mr. Butler said at the Sept. 25 hearing.

Delphi and the Creditors Committee engaged in negotiations
regarding the Amended GSA and MRA.  Possible scenarios, according
to Reuters, included GM accepting preferred Delphi shares, or
splitting administrative proceeds 50-50 with Delphi's unsecured
creditors.  The Debtors and GM reached a first amendment to the
Amended GSA on Sept. 25, 2008, which added these provisions:

    1. "GUC Percentage" shall mean .2 multiplied by the amount of
       allowed general unsecured claims (exclusive for all
       purposes of this section 1.57(a) of holders of TOPrS
       Claims, as defined in the 2007 Plan) divided by the sum of
       $2.055 billion and the product of .2 and the amount of
       allowed general unsecured claims.

    2. If any condition for the receipt by GM of the preferred
       stock described in Section 4.04(c) of the GSA is not
       satisfied or waived by GM, holders of general       
       unsubordinated unsecured claims (exclusive for all
       purposes of this section 4.04(a) of TOPrS Claims, as
       defined in the 2007 Plan) shall receive 50% of all
       distributions that otherwise would be made to GM on
       account of its administrative expense claims allowed
       pursuant to this Section 4.04(a) to the extent necessary
       for such holders to receive an aggregate distribution,       
       exclusive of any value received as a result of
       participation by such holders in any rights offering or
       similar undertaking, on account of their allowed general
       unsubordinated unsecured claims equal in value of up to
       $300 million.

    3. If all conditions for the receipt by GM of the preferred
       stock described in the preceding sentence are satisfied,
       value equal (at Plan value) to an amount of up to the GUC
       Percentage multiplied by the stated value of the preferred
       stock otherwise distributable to GM under the first
       sentence of this Section 4.04(c) shall be distributed to        
       holders of general unsubordinated unsecured claims
       (exclusive for all purposes of this section 4.04(c) of
       holders of TOPrS Claims, as defined in the 2007 Plan) to
       the extent necessary to permit the holders of general
       unsubordinated unsecured claims to receive distributions,
       exclusive of any value received as a result of
       participation by such holders in any rights offering or
       similar undertaking, equal to 20% of their allowed general
       unsubordinated unsecured claims.  

    4. Any amendments to the Amended GSA or the Amended MRA that
       are materially adverse to the Debtors' estates shall
       require the consent of the Creditors Committee.

A full-text copy of the First Amendment to the Amended GSA is
available for free at http://ResearchArchives.com/t/s?332e

Delphi also posted a summary of indicative terms for the
preferred stock it will issue to GM pursuant to a POR.  The
summary provides that Shares of Series D Convertible Preferred
Stock, par value $0.01 per share, with an aggregate initial
stated value of $2,055,000,000 will be issued to GM.  Delphi may
pay cash to GM to reduce the number of shares issued at a price
equal to the Stated Value per share.  A copy of the Summary is
available for free at http://ResearchArchives.com/t/s?332d

                       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 US$9,162,000,000
in total assets and US$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 US$2,550,000,000 in equity financing to
Delphi.

(Delphi Bankruptcy News, Issue 146; Bankruptcy Creditors' Service
Inc., http://bankrupt.com/newsstand/or 215/945-7000)

                    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 June 30, 2008, the company's balance sheet showed total assets
of $136.0 billion, total liabilities of $191.6 billion, and total
stockholders' deficit of $56.9 billion.  For the quarter ended
June 30, 2008, the company reported a net loss of $15.4 billion
over net sales and revenue of $38.1 billion, compared to a net
income of $891.0 million over net sales and revenue of $46.6
billion for the same period last year.


GREY'S CREEK: Case Summary & 11 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Grey's Creek Development Company, LP
        4746 Spottswood
        Memphis, TN 3811

Bankruptcy Case No.: 08-30006

Chapter 11 Petition Date: September 26, 2008

Court: Western District of Tennessee (Memphis)

Judge: Jennie D. Latta

Debtor's Counsel: P. Preston Wilson, Esq.
                  ppwgwsb@bellsouth.net
                  Gotten, Wilson, Savory & Beard
                  88 Union Avenue
                  14th Floor
                  Memphis, TN 38103
                  Tel: (901) 523-1110
                  Fax: (901) 523-1139

Total Assets: $1,879,499

Total Debts: $1,191,981

Debtor's 11 Largest Unsecured Creditors:

   Entity                             Claim Amount
   ------                             ------------
   D. Curtis Wegener                      $382,000
   9131 Reiveredge
   Cordova TN 38018

   Shelby County Clerk                      $5,195
   P.O. Box 2751
   Memphis TN 38013

   Shelby County Clerk                      $3,800
   P.O. Box 2751
   Memphis TN 38013

   Shelby County Clerk                      $3,652
   P.O. Box 2751
   Memphis TN 38013

   Shelby County Clerk                      $3,186
   P.O. Box 2751
   Memphis TN 38013

   City of Memphis                          $3,178
   P.O. Box 185
   Memphis TN 38011   

   Shelby County Clerk                      $2,723
   P.O. Box 2751
   Memphis TN 38013

   Shelby County Clerk                      $2,514
   P.O. Box 2751
   Memphis TN 38013

   Shelby County Clerk                      $2,170
   P.O. Box 2751
   Memphis TN 38013

   City of Memphis                          $1,056
   P.O. Box 185
   Memphis TN 38011   

   Shelby County Clerk                        $503
   P.O. Box 2751
   Memphis TN 38013


GUIDED THERAPEUTICS: Files 10-K/A to Reclassify Debt Forgiveness
----------------------------------------------------------------
Guided Therapeutics, Inc., filed amendment No. 1 to its annual
report on form 10-K for the year ended Dec. 31, 2007.

On the company's previously filed Consolidated Statements of
Operations for the year ended Dec. 31, 2007, the company included
the gain on debt forgiveness of $5.80 million as part of operating
income.  Upon further review, under the guidance of FAS 154, the
debt forgiveness was neither unusual in nature nor considered
infrequent.  Hence, the company has reclassified the amount to
"Non Operating Gain" on its statements of operations.  All future
filings will reflect the reclassification.  Furthermore, the
company has amended the filing to separately disclose on the
balance sheet the referenced related party notes payable in
accordance with ARB 43.  All future filings will reflect the
change in description.

In a revised report dated Sept. 28, 2008, UHY LLP in Atlanta Ga.,
raised substantial doubt about Guided Therapeutics, Inc.'s ability
to continue as a going concern after it audited the company's
revised financial statements for the year ended Dec. 31, 2007.  
The auditor pointed to the company's recurring losses from
operations, accumulated deficit and working capital deficit.

The company posted a restated net income of $3.02 million on
restated total service revenues of $1.04 million for the year
ended Dec. 31, 2007, as compared with a restated net loss of
$4.95 million on restated total service revenues of $0.60 million
in the prior year.

At Dec. 31, 2007, the company's consolidated balance sheet showed
around $1.00 million in total assets and around $5.91 million in
total liabilities, resulting in a $4.93 million stockholders'
deficit.  

The company's consolidated balance sheet at Dec. 31, 2007, also
showed strained liquidity with around $0.79 million in total
current assets available to pay around $3.78 million in total
current liabilities.

A full-text copy of the company's restated 2007 annual report is
available for free at http://ResearchArchives.com/t/s?3327

                  About Guided Therapeutics

Guided Therapeutics, Inc. (Other OTC: GTHP.PK) --
http://www.spectrx.com-- Guided Therapeutics, Inc., a medical  
technology company, together with its subsidiaries, develops
products for the non-invasive cervical cancer detection and
diabetes markets.  The company is developing a non-invasive
cervical cancer detection product using its biophotonic
technologies, which is used to identify cervical cancers and
precancers painlessly, non-invasively, and at the point-of-care by
scanning the cervix with light, then analyzing the light reflected
or emanating from the cervix to produce a map or image of diseased
tissue.  Guided Therapeutics has license agreements with Georgia
Tech Research Corporation and Altea Technologies, Inc.  The
company, formerly known as SpectRx, Inc., was founded in 1992 and
is based in Norcross, Ga.


HANLEY WOOD: Moody's Affirms B Ratings, Changes Outlook to Neg
--------------------------------------------------------------
Moody's Investors Service affirmed all the credit ratings of
Hanley-Wood, LLC ("Hanley Wood") while changing the rating outlook
to negative from stable. The change in outlook was prompted by
recent declines in revenue and EBITDA that have resulted in
financial leverage at the maximum tolerance level for the B2
rating category. Solid performance by the company's Exhibitions
segment has only partially mitigated the significant shortfalls in
print advertising and house plan design sales realized in its
Business Media segment, the largest segment in terms of revenue.
The negative outlook further reflects macroeconomic and industry-
wide trends in the US residential housing and commercial
construction markets and Moody's concern that current conditions
could be protracted and lead to further declines in Hanley Wood's
operating results.

The B2 Corporate Family Rating and B3 Probability of Default
Rating continue to reflect the high margins and relative stability
of Hanley Wood's Exhibitions business, for which there appears to
be some degree of visibility into future revenues. The company's
two largest trade shows represent a considerable portion of
consolidated EBITDA and take place during the first quarter of the
year. Moody's expects these two shows to generate EBITDA in 2009
at similar levels to 2008. Also supporting the ratings are the
brand value of "World of Concrete" and "Builder" and Moody's
expectation that Hanley Wood's liquidity profile will be adequate
over the near term. Management has proactively implemented
significant cost containment measures and, as a result, Moody's
expects free cash flow to remain positive in 2009 in spite of the
severity of the current downtown in the housing markets.
Nevertheless, any further increase in financial leverage or
shortfall in EBITDA as compared to expectations could lead to a
downgrade.

Moody's affirmed these ratings:

   $65 million senior secured revolver due 2013, B2 / LGD 3 (35%)

   $399 million senior secured term loan B due 2014, B2 / LGD 3
(35%)

   Corporate Family Rating, B2

   Probability of Default Rating, B3

The previous rating action occurred on February 28, 2007 when
Moody's affirmed Hanley Wood's B2 Corporate Family Rating,
downgraded the Probability of Default Rating to B3 from B2 and
downgraded the credit facility rating to B2 from B1. These actions
were prompted by the refinancing of the company's subordinated
notes with a term loan add-on.

Headquartered in Washington, DC, Hanley Wood is a leading
business-to-business media company serving customers in the
residential housing and commercial construction end markets.
Revenues for the 12 month period ended June 30, 2008 were
$220 million.


HENRICKS JEWELERS: Emerges From Chapter 11 Bankruptcy
-----------------------------------------------------
Tara McLaughlin at Naples (Florida) Daily News reports that
Henricks Jewelers has satisfied its requirements under Chapter 11
bankruptcy.

Naples Daily relates that the U.S. Bankruptcy Court for the Middle
District of Florida approved Henricks Jewelers' reorganization
plan and in August, the company started operating anew, the report
says.  The company is now jointly owned by Luxury Ventures and
Kairos Capital Partners, the report states.

According to Naples Daily, a court-ordered liquidation sale
generated about $11 million in 18 weeks ending in March 2008.  
Naples Daily states that at the time of the bankruptcy, the
jeweler owed about $13 million to its creditors.  Henricks
Jewelers, says the report, will pay $3 million it still owes its
creditors over the next four years.

Henricks Jeweler has kept its two stores in Bonita Springs and
Naples, Naples Daily states.

Headquartered in Bonita Springs, Florida, Henricks Jewelers --
http://www.henricksjewelry.com/-- is a manufacturing jeweler in  
Southwest Florida with more than 50 employees.  It was originally
opened in Bonita Springs, Florida in 1982 by Henry Grimes and his
son Rick Grimes thus forming the name Henricks.  Over the years
the small original store on Bonita Beach Road, evolved into its
third and current location that houses nearly 12,000 flagship
stores.  In April 2003, Rick Grimes joined forces with Luxury
Ventures LLC and investment partners Kevin Waters, CEO and Patrick
Hopper, CFO.

Henricks Jewelers filed for Chapter 11 protection in November
2007.  


HINES HORTICULTURE: Committee Taps Stevens & Lee as Co-Counsel
--------------------------------------------------------------
The Official Committee of Unsecured Creditors of Hines of
Horticulture Inc. and Hines Nurseries Inc. asks the United States
Bankruptcy Court for the District of Delaware for permission to
employ Stevens & Lee, P.C., as its co-counsel.

Stevens & Lee will:

  a) advise the Committee and represent it with respect to
     proposals and pleadings submitted by the Debtors or others to
     the Court;

  b) represent the Committee with respect to any plans of
     reorganization or disposition of assets proposed in this
     cases;

  c) attend hearings, draft and review pleadings and generally
     advocating positions, which further the interests of the
     creditors represented by the Committee;

  d) assist in the examination of the Debtors' affairs and a
     review of their operations.

  e) advise the Committee about the progress of the Chapter 11
     case; and

  f) perform other professionals services in the best interest of
     those represented by the Committee, including without
     limitation those delineated in Section 1103() of the
     Bankruptcy Code.

The firm's professionals and their compensation rates are:

     Professionals                Designations   Hourly Rates
     -------------                ------------   ------------
     Joseph H. Huston, Jr., Esq.  Shareholder        $480
     Joseph Grey, Esq.            Shareholder        $430
     
     Paralegals                                    $105-$175

Joseph H. Huston, Jr., Esq., assures the Court that the firm does
not hold any interests adverse to the Debtors' estate and their
creditors and is a "disinterested person" as defined in Section
101(14) of the Bankruptcy Code.

Mr. Huston can be reached at:

  Joseph H. Huston, Jr., Esq.
  Stevens & Lee, P.C.
  1105 North Market Street, 7th Floor
  Wilmington, Delaware 19801
  Tel: (570) 323-8506.
  http://www.stevenslee.com/  

                     About Hines Horticulture

Headquartered in Irvine, California, Hines Horticulture, Inc. --
http://www.hineshorticulture.com/-- operates nursery facilities
located in Arizona, California, Oregon and Texas.  Through its
affiliate, the company produces and distributes horticultural
products.  The company and its affiliate, Hines Nurseries, Inc.,
filed for Chapter 11 protection on Aug. 20, 2008 (Bankr. D. Del.
Case No.08-11922).  Anup Sathy, Esq., and Ross M. Kwasteniet,
Esq., at Kirkland & Ellis, LLP, represent the Debtors in their
restructure efforts.  Robert S. Brady, Esq., and Edmon L. Morton,
Esq., at Young, Conaway, Stargatt & Taylor, serve as the Debtors'
co-counsel.  The Debtors selected Epiq Bankruptcy Solutions LLC as
their voting and claims agent, and Financial Balloting Group LLC
as their securities voting agent.  When the Debtors filed for
protection from their creditors, they listed assets and debts
of between $100 million and $500 million each.


HOME INTERIORS: Says Sale of Operating Units May Affect Workers
---------------------------------------------------------------
Dallas (Texas) Business Journal reports that Home Interiors &
Gifts Inc. has informed the 130 workers at its Carrollton facility
that the sale of its operating entities may affect their jobs in
the next few months.

According to Dallas Business, Home Interiors sought the permission
of the U.S. Bankruptcy Court for the Northern District of Texas to
sell its operating entities earlier last week.

Dallas Business relates that Home Interiors said in a letter sent
to the Texas Workforce Commission that workers have been informed
of the potential impact that a sale could have on their positions.  
Home Interiors also said that a sale of the assets could lead to
potential employment opportunities for the workers, Dallas
Business statse.

"The company continues to conduct operations.  It's possible
potential buyer(s) of the company's assets will hire employees who
received Warn Act notices, although the company cannot make any
guarantee," Dallas Business quoted Home Interiors as saying.

                      About Home Interiors

Headquartered in Carrollton, Texas, Home Interiors & Gifts, Inc.
-- http://www.homeinteriors.com/-- manufactures, imports and  
distributes indoor and outdoor home decorative accessories.  It
was founded by Mary Crowley in 1957.  Through its affiliates, the
company has a significant presence in Mexico, Puerto Rico, and
Canada.  Annual revenue in 2007 reached $300 million.  When Mary
Crowley, died in 1986, her son, Don Carter continued the business
operation nearly debt-free.  In a leveraged transaction in 1998,
private equity firm of Hicks, Muse, Tate, and Furst acquired 66%
of the parent company, which resulted in the imposition of more
than $500 million in debt on the Debtors.  In the face of
decreased sales and increased debt load, bondholders canceled
their debts in February 2006 in exchange for receiving most of the
outstanding equity of the Debtors.

About 40% of the goods the Debtors sell are now acquired from
manufacturers in China.  In the last decade, sales volume in the
U.S. has waned, but the Debtors reported that sales in Mexico and
Puerto Rico significantly increased.

The company and six of its affiliates filed for Chapter 11
protection on April 29, 2008 (Bankr. N.D. Tex. Lead Case No.
08-31961).  Andrew E. Jillson, Esq., Cameron W. Kinvig, Esq.,
Lynnette R. Warman, Esq., and Michael P. Massad, Jr., Esq., at
Hunton & Williams, LLP, represent the Debtors in their
restructuring efforts.  The U.S. Trustee for Region 6 has
appointed seven creditors to serve on an Official Committee
of Unsecured Creditors.  Richard A. Lindenmuth, at Boulder
International LLC, is designated as CRO.  Munsch Hardt Kopf &
Harr PC represents the Committee in these cases.  When the
Debtors file for protection from their creditors, they listed
assets of between $100 million and $500 million and the same range
of debts.


HOME INTERIORS: Committee Objects to Houlihan Lokey Employment
--------------------------------------------------------------
The Official Committee of Unsecured Creditors appointed in Home
Interiors & Gifts Inc. and its affiliated debtors' bankruptcy
cases filed with the U.S. Bankruptcy Court for the Northern
District of Texas its limited objection to the Debtors' request
for authority to employ Houlikan Lokey Howard & Zukin Capital,
Inc. as their investment bankers and financial advisors, nunc pro
tunc to Sept. 19, 2008.

The Committee told the Court that Houlihan Lokey will receive a  
minimum fee of $1 million regardless of whether the Mexico
division sells for $1 million or $40 million, as provided under
the Engagement Agreement.  The Committee said that this appears to
be unreasonable and excessive.

In addition, the Committee told the Court that an asset of the
Debtors that is not encumbered by the liens of the secured Lenders
is a 35% interest in the Debtors' Mexico division.  Therefore, the
unsecured creditors are disproportionately prejudiced if the
Houlihan Lokey fee taken from the Mexico sale is $1 million and
there is a lower than anticipated sales price.

As reported by the Troubled Company Reporter on September 25,
2008, the Debtors have tapped Houlihan Lokey to manage the sale
process, pursuant to which:

   -- U.S., Canada and Puerto Rico operational assets will be
      offered as a single unit.  Home Interiors & Gifts' president
      and chief executive officer, Robin Crossman, is leading a
      team of investors that is expected to submit a bid to
      purchase certain operational assets of the U.S., Canada and
      Puerto Rico entities.

   -- The company's operations in Mexico, Home Interiors de
      Mexico, will be offered independently.  Fabian Uribarren,
      president of Home Interiors de Mexico, is leading a team
      that is expected to be the lead candidate to purchase this
      entity.

   -- Domistyle Inc. will be offered as an independent company.
      Domistyle is a home dA(C)cor and home fragrance manufacturer
      and distributor based in Dallas, Texas.  The company was
      founded by Brenda Buell and sold to Home Interiors & Gifts
      in 2002.  Ms. Buell, president of Domistyle, is leading a
      team that is expected to be the lead candidate to purchase
      this entity.

   -- The company's Laredo Candle operational assets, based in
      Laredo, Texas, will be offered as a single unit; however,
      it may be included as part of a sale of Domistyle.

The Committee said that considering that the Debtors have already
identified at least one party interested in acquiring each of the
Debtors' business segments, and considering further that the each
of these parties are insiders well known to the Debtors, and
therefore provide relatively reliable prospects of serving as
"stalking horse" bidders for the Debtors' assets, the fee regaring
Mexico should be adjusted accordingly.

The Committee additionally has concerns regarding the Debtors
efforts to sell its assets.  One potential purchaser has been
voicing concern over the Debtors' failure to turn over
information requested since early August when said purchaser
signed a binding confidentiality agreement.  

The Committee said that it supports the application of Houlihan
Lokey provided that all parties, including third parties not
connected to the Debtors, receive timely information in this case.  
The Committee told the Court that there appears to be some
inclination by the Debtors to only work towards obtaining bids
from insiders.  Because of the delays that have been suffered by
one purchaser, the Committee requests that Houlihan Lokey
immediately provide all information reasonably requested by third
party bidders so that may also have an opportunity to become a
stalking horse bidder in an auction process.

The Committee asks the Court to enter its order denying Houlihan
Lokey's retention, approving it only subject to the limited
objections raised by the Committee.

                      About Home Interiors

Headquartered in Carrollton, Texas, Home Interiors & Gifts, Inc.
-- http://www.homeinteriors.com/-- manufactures, imports and          
distributes indoor and outdoor home decorative accessories.  It
was founded by Mary Crowley in 1957.  Through its affiliates,
the company has a significant presence in Mexico, Puerto Rico,
and Canada.  Annual revenue in 2007 reached $300 million.  When
Mary Crowley, died in 1986, her son, Don Carter continued the
business operation nearly debt-free.  In a leveraged transaction
in 1998, private equity firm of Hicks, Muse, Tate, and Furst
acquired 66% of the parent company, which resulted in the
imposition of more than $500 million in debt on the Debtors.  In
the face of decreased sales and increased debt load, bondholders
canceled their debts in February 2006 in exchange for receiving
most of the outstanding equity of the Debtors.

About 40% of the goods the Debtors sell are now acquired from
manufacturers in China.  In the last decade, sales volume in the
U.S. has waned, but the Debtors reported that sales in Mexico
and Puerto Rico significantly increased.

The company and six of its affiliates filed for Chapter 11
protection on April 29, 2008 (Bankr. N.D. Tex. Lead Case No.
08-31961).  Andrew E. Jillson, Esq., Cameron W. Kinvig, Esq.,
Lynnette R. Warman, Esq., and Michael P. Massad, Jr., Esq., at
Hunton & Williams, LLP, represent the Debtors in their
restructuring efforts.  The U.S. Trustee for Region 6 has
appointed seven creditors to serve on an Official Committee
of Unsecured Creditors.  Richard A. Lindenmuth, at Boulder
International LLC, is designated as CRO.  Munsch Hardt Kopf &
Harr PC represents the Committee in these cases.  When the
Debtors filed for protection against their creditors, they
listed assets of between $100 million and $500 million and the
same range of debts.


HOME OWNERSHIP: Moody's Cuts Preferred Stock Rating to Ba2
----------------------------------------------------------
Moody's Investors Service downgraded the cumulative step-down
preferred stock rating of Home Ownership Funding Corporation I and
II (HOFC) to Ba2 from Aa2. The outlook is developing. HOFC is a
real estate investment trust which is 99% owned by the Federal
Home Loan Mortgage Corporation (Freddie Mac).

This rating action follows the announcement by Freddie Mac that
HOFC will stop paying preferred dividends. Moody's believes that
the suspension of HOFC's preferred dividends may last several
years. Moody's expects that HOFC will have sufficient resources to
pay the cumulative dividends upon the re-institution of payments.

The Ba2 rating reflects the lost value associated with missed
dividend payments. The developing outlook reflects uncertainty as
to the length of time for which dividends may be deferred.

These ratings have been downgraded with a developing outlook:

Home Ownership Funding Corporation I - Preferred Stock to Ba2 from
Aa2

Home Ownership Funding Corporation II - Preferred Stock to Ba2
from Aa2

Moody's last rating action on Home Ownership Funding Corporation I
& II was on September 7, 2008.


HRP MYRTLE: Gets Initial OK to Use $1 Million Cerberus DIP Loan
---------------------------------------------------------------
The Hon. Kevin J. Carey of the United States Bankruptcy Court
for the District of Delaware authorized HRP Myrtle Beach Holdings
LLC and its debtor-affiliates to obtain, on an interim basis,
$1 million in postpetition financing from Cerberus Partners, L.P.,
as administrative and collateral agent, under a credit agreement.

Judge Carey also authorized the Debtors to use, on the interim
basis, cash collateral securing repayment of the secured loan to
Cerberus Partners.

A hearing is set of Oct. 22, 2008, at 4:00 p.m., to consider final
approval of the motion.  Objections, if any, are due Oct. 15,
2008.  The hearing will take place at 824 Market Street, 5th
floor, Courtroom #5 in Wilmington, Delaware.

Under the credit agreement, the lender agreed to provide up to
$2 million in financing to the Debtors, on the final basis.  The
loan will bear interest at a rate per annum equal to the LIBOR
Rate plus 15 percentage points.  Furthermore, the lender's
facility will mature on the earliest of:

  a) Oct. 31, 2008;

  b) the closing date of a sale or liquidation of all
     substantially all of the Debtors' assets of the loan; and

  c) the termination by the postpetition agent of the term loan
     commitments upon the occurrence and during the continuance of
     an event of default.

The proceeds of the loans will be used to (i) repay amounts
outstanding under the credit agreement, (ii) pay fees and expenses
related to the loan, and (iii) fund working capital in the
ordinary course of business.

The Debtors will pay a host of fees including a loan servicing of
$10,000 per month to the lender on the closing date and on the
first business day of each month thereafter.

The DIP facility is subject to $100,000 carve-out to pay fees and
expenses incurred by professionals retained by the Debtors and any
committee, among other things.

The DIP agreement contains customary and appropriate events of
default.

To secure their DIP obligations, the lenders will be entitled to a  
superpriority administrative expense claims status over all other
administrative claims of and unsecured claims against the Debtors.

                           Indebtedness

As of their bankruptcy filing, the Debtors owe Deutsche Bank Trust
Company Americas as much as:

  i) $15 million, plus accrued and unpaid interest and fees, costs
     and expenses -- including fees and expenses of the counsel,
     consultants and advisor -- under a revolving credit agreement
     dated March 30, 2006; and

ii) $155 million, plus accrued and unpaid interest and fees,
     costs and expenses, arising under the floating rate senior
     secured notes due 2012.

     The interest on the senior notes accrues at a variable rate
     of the six-month LIBOR rate plus 4.75% and is reset semi-
     annually.  As of June 30, 2008, the interest rate on the
     senior notes was 7.38%

The revolving credit and senior note obligations constitute the
legal, valid and binding obligations of the Debtors, enforceable
in accordance withe terms of the financing documents.

The Debtors submit to the Court a debtor-in-possession weekly cash
flow.  A full-text copy of the Debtors' DIP weekly cash flow is
available for free at http://ResearchArchives.com/t/s?3336

A full-text copy of the Debtor-in-Possession Credit Agreement
between the Debtors and Cerberus is available for free at:

          Part One: http://ResearchArchives.com/t/s?3336
          Part Two: http://ResearchArchives.com/t/s?3337

Headquartered in Myrtle Beach, South Carolina, HRP Myrtle Beach
Holdings, LLC -- owns and operates Hard Rock Park, a rock-n-roll
theme park in Myrtle Beach, South Carolina, under a long-term
license agreement with Hard Rock Cafe International (USA), Inc.  
The company and six of its affiliates filed for Chapter 11
protection on Sept. 24, 2008 (Bankr. D. Del. Lead Case No. 08-
12193).  Paul, Hastings, Janofsky & Walker LLP represents the
Debtors for their restructuring efforts.  The Debtors selected
Richards, Layton & Finger as their co-counsel.  The Debtors also
selected RAS Group Inc. as their financial advisor.  Steven
Goodwin will serve as the Debtors' chief executive officer.  The
U.S. Trustee for Region 3 has not appointed creditors to serve on
an Official Committee of Unsecured Creditors.  When the Debtors
filed for protection from their creditors, they listed assets and
debts between $100 million to $500 million each.


HRP MYRTLE: Section 341(a) Meeting Slated for October 21
--------------------------------------------------------
The U.S. Trustee for Region 3 will convene a meeting of creditors
of HRP Myrtle Beach Holdings LLC and its debtor affiliates on Oct.
21, 2008, at 11:00 a.m., at the U.S. District Court, 844 King
Street, Room 212 in Wilmington, Delaware.

This is the first meeting of creditors required under Section
341(a) of the Bankruptcy Code in all bankruptcy cases.

All creditors are invited, but not required, to attend.  This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible office of the
Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.

Headquartered in Myrtle Beach, South Carolina, HRP Myrtle Beach
Holdings, LLC -- owns and operates Hard Rock Park, a rock-n-roll
theme park in Myrtle Beach, South Carolina, under a long-term
license agreement with Hard Rock Cafe International (USA), Inc.  
The company and six of its affiliates filed for Chapter 11
protection on Sept. 24, 2008 (Bankr. D. Del. Lead Case No.
08-12193).  Paul, Hastings, Janofsky & Walker LLP represents the
Debtors in their restructuring efforts.  The Debtors selected
Richards, Layton & Finger as their co-counsel.  The Debtors also
selected RAS Group Inc. as their financial advisor.  Steven
Goodwin will serve as the Debtors' chief executive officer.  The
U.S. Trustee for Region 3 has not appointed creditors to serve on
an Official Committee of Unsecured Creditors.  When the Debtors
filed for protection from their creditors, they listed assets and
debts of between $100 million and $500 million each.
          

IDEAEDGE INC: Files Prospectus to Sell 2.3 Million Common Stock
---------------------------------------------------------------
IdeaEdge, Inc. has filed with Securities and Exchange Commission a
preliminary prospectus relating to the offer and sale by the
selling stockholders of up to 2,334,849 shares of the company's
common stock at maximum offering of $2.55 each issuable upon the
exercise of outstanding warrants to purchase common stock.

The shares offered include:

   -- 1,818,182 shares of common stock, issuable upon the exercise
      of outstanding warrants to purchase common stock that were
      issued in connection with the sale of the company's Series A
      preferred stock on June 5, 2008;

   -- 416,667 shares of common stock, issuable upon the exercise
      of outstanding warrants to purchase common stock that were
      issued in connection with the sale of the company's
      unregistered common stock on Aug. 25, 2008;

   -- 100,000 shares of common stock, issuable upon the exercise
      of outstanding warrants to purchase common stock that were
      issued to Joseph Abrams in connection with an Advisor
      Agreement between him and the Company dated June 23, 2008.

A copy of the prospectus is available free of charge at:

               http://researcharchives.com/t/s?32e8

                       Going Concern Doubt

Cordovano and Honeck LLP, in Englewood, Colorado, expressed
substantial doubt about IdeaEdge Inc.'s ability to continue as a
going concern after auditing the company's consolidated financial
statements for the year ended Sept. 30, 2007.  The auditing firm
reported that the company has incurred net losses since inception
and has a net capital deficit at Sept. 30, 2007.

                        About IdeaEdge Inc.

Headquartered in San Diego, IdeaEdge Inc. (OTC BB: IDED) develops
gift card programs.  The company distributes its gift cards
primarily through major retail channels and online.  The company's
flagship gift card program is based on American Idol(TM), a
leading entertainment and consumer merchandise brand in the U.S.
The company will offer a wide range of consumer merchandise with
American Idol(TM) and future brand partners


IDLEAIRE TECH: Stephen Gray Resigns as Chief Restructuring Officer
------------------------------------------------------------------
IdleAire Technologies Corp. informed the U.S. Bankruptcy Court for
the District of Delaware on Sept. 24, 2008, that CRG Partners
Group LLC and Stephen S. Gray have resigned as Crisis Managers and
Chief Restructuring Officer, respectively, of the company.

As reported by the Troubled Company Reporter yesterday, the Debtor
has appointed James H. Price as Interim CEO to carry out the
remaining obligations of the Debtor during the pendency of its
Chapter 11 case.  At interim chief executive officer, Mr. Price
will receive $5,000 per week.

                   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.


INTEGRAL VISION: Modifies Pacts with Special Situations, et al.
---------------------------------------------------------------
Integral Vision, Inc. disclosed in a Securities and Exchange
Commission filing that on Sept. 15, 2008, it executed a Waiver and
Amendment Agreement with the parties to a Securities Purchase
Agreement dated April 12, 2005.

In conjunction with the Waiver and Amendment Agreement, the
Company issued Warrants to purchase its common stock and agreed,
pursuant to a Registration Rights Agreement, to register the
resale of the shares underlying the New Warrants.

The parties to the Waiver and Amendment Agreement and the
Registration Rights Agreement are the Company, and these entities:

   -- Special Situations Technology Fund II, L.P.
   -- Special Situations Technology Fund, L.P.
   -- Special Situations Cayman Fund, L.P.
   -- Special Situations Private Equity Fund, L.P.
   -- Bonanza Master Fund Ltd.
   -- SRB Greenway Capital, L.P.
   -- SRB Greenway Offshore Operating Fund, L.P.
   -- SRB Greenway Capital (QP), L.P., and
   -- Kircher Family Trust.

Each of the Investors received New Warrants in proportion to their
original investment in the Company under the 2005 Agreement. None
of the Investors have any relationship with the Company or its
affiliates, other than in respect of the agreements.

            Restructuring of Class 2 and Class 3 Notes

On Sept. 15, 2008, the Company entered into a series of Exchange
Agreements with certain holders of the Company's Class 2 Notes and
Class 3 Notes.  In conjunction with the Exchange Agreements, the
holders of Class 2 Notes agreed to either amend their Class 2
Notes or exchange their Class 2 Notes for Class 3 Notes. Such
holders of Class 3 Notes agreed to either amend their Class 3
Notes or exchange their Class 3 Notes for Class 2 Notes.

The holders of Class 2 Notes that have entered into the Exchange
Agreements are:

   -- Susan W. Pillsbury Revocable Trust
   -- Michael H. Kiely
   -- Maxco, Inc.
   -- Max Coon
   -- Max A. Coon
   -- John R. & Margaret Lee Kiely Revocable Trust
   -- P. Robert Klonoff and Susan J. Klonoff
   -- The Klonoff Company, Inc.
   -- John R. Kiely, III Trust
   -- John R. Kiely, III
   -- Dale Renee Kehoe Trust
   -- Industrial Boxboard Corporation Profit Sharing Plan & Trust;
   -- The Carney Trust

The holders of Class 3 Notes that have entered into the Exchange
Agreement are:

   -- Ricardo L. Larrabure
   -- Michael H. Kiely (personally and as an IRA beneficiary)
   -- Maria P. Kiely (IRA beneficiary)
   -- Kotun C. Kiely and Michael H. Kiely
   -- Dale R. Kehoe
   -- Inmay P. Kiely and Michael H. Kiely
   -- Garrett H. Larrabure
   -- Yung Kwang J. Kiely and Michael H. Kiely; and
   -- Robert W. Collis

Max A. Coon is a Vice Chairman, Secretary and Director of the
Company. John R. Kiely, III and John A. Hunter (a co-trustee of
the Industrial Boxboard Corporation Profit Sharing Plan and Trust)
are shareholders of the Company that are required to report their
holdings under Section 16(a) of the Securities Exchange Act of
1934.

                      About Integral Vision

Based in Wixom, Michigan, Integral Vision Inc. (OTC BB: INVI)
-- http://www.iv-usa.com/-- develops, manufactures and markets   
flat panel display inspection systems to ensure product quality in
the display manufacturing process.

                       Going Concern Doubt

Rehmann Robson, P.C., in Troy, Michigan, expressed substantial
doubt about Integral Vision Inc.'s ability to continue as a going
concern after auditing the company's financial statements for the
year ended Dec. 31, 2007.  The auditing firm reported that the
company is sustaining recurring losses from operations and is
having difficulties in achieving the necessary sales to attain
profitability.

Integral Vision Inc.'s balance sheet at March 31, 2008, showed
$1,136,000 in total assets and $5,276,000 in total liabilities,
resulting in a $4,140,000 total stockholders' deficit.

At March 31, 2008, the company's balance sheet also showed
strained liquidity with $878,000 in total current assets available
to pay $5,276,000 in total current liabilities.


INTEGRAL VISION: June 30 Balance Sheet Upside Down by $4.7 Million
------------------------------------------------------------------
Integral Vision Inc.'s balance sheet at June 30, 2008, showed
$908,000 in total assets and $5,651,000 in total liabilities,
resulting in a $4,743,000 total stockholders' deficit.

At June 30, 2008, the company's balance sheet also showed
strained liquidity with $668,000 in total current assets available
to pay $5,651,000 in total current liabilities.

The company reported a net loss of $649,000 on total revenues of
$470,000 for the second quarter ended June 30, 2008, compared with
a net loss of $866,000 on total revenues of $94,000 in the
corresponding period a year ago.

Full-text copies of the company's financial statements for the
quarter ended June 30, 2008, are available for free at:

               http://researcharchives.com/t/s?3318

                       Going Concern Doubt

Rehmann Robson, P.C., in Troy, Michigan, expressed substantial
doubt about Integral Vision Inc.'s ability to continue as a going
concern after auditing the company's financial statements for the
year ended Dec. 31, 2007.  The auditing firm reported that the
company is sustaining recurring losses from operations and is
having difficulties in achieving the necessary sales to attain
profitability.

                      About Integral Vision

Based in Wixom, Michigan, Integral Vision Inc. (OTC BB: INVI)
-- http://www.iv-usa.com/-- develops, manufactures and markets   
flat panel display inspection systems to ensure product quality in
the display manufacturing process.


IRVINE SENSORS: Inks MOU to Restructure $18.4 Million Secured Debt
------------------------------------------------------------------
Irvine Sensors Corporation disclosed in a Securities and Exchange
Commission filing that on Sept. 19, 2008, it entered into a
binding Memorandum of Understanding for Settlement and Debt
Conversion with its senior lenders, Longview Fund, L.P and Alpha
Capital Anstalt with the intent to effect a global settlement and
restructuring of the Company's outstanding indebtedness payable to
the Lenders.

As of Aug. 24, 2008, the total principal, interest and related
amounts owed by the Company to the Lenders was approximately
$18.4 million in connection with these loans:

   -- Series 1 and Series 2 senior subordinated secured
      convertible notes payable to the Lenders in the original
      principal amount of $10.0 million;

   -- Term notes payable to the Lenders in the original principal
      amount of $8.25 million;

   -- Secured promissory note payable to Longview Fund, L.P. in
      the original principal amount of $2.0 million; and

   -- Secured promissory notes (restructuring) payable to the
      Lenders in the original principal amount of $1.15 million.

All of the Obligations are secured by the Company's assets and the
Obligations are guaranteed by Optex Systems, Inc., its wholly
owned subsidiary.  The Obligations do not include the contingent
secured promissory notes payable to the Lenders in the original
principal amount of $1.15 million, which notes will be canceled in
accordance with their terms in the event the Obligations are
discharged as set forth in the MOU prior to Dec. 30, 2009.  

The Obligations also do not include:

   -- any amounts currently owed to the Lenders arising for
      indemnification obligations under its loan documents with
      the Lenders; or

   -- any amounts for expenses, including attorneys fees, incurred
      or to be incurred by the Lenders in connection with this MOU
      or the restructuring transactions or enforcement
      transactions contemplated by the MOU.

Pursuant to the MOU, the Lenders have indicated that they will
deliver to the Company and Optex a notice of the occurrence of an
event of default and acceleration of the Obligations, and will
provide notice under the New York Uniform Commercial Code to
conduct a public sale of the assets of Optex in accordance with
the NY UCC. The Lenders, or an entity controlled by the Lenders,
have agreed to credit bid not less than $15.0 million of the
Obligations in this public sale.  Following the consummation of
the sale, Irvine's obligations for principal and deferred interest
owed to the senior lenders are expected to be less than $4
million.

Subject to satisfying certain conditions, including the Company's
consummation of specified debt and equity financings, the Lenders
have agreed to exchange the residual Obligations for a new class
of non-voting convertible preferred stock of the Company.  In
particular, the Lenders have agreed to exchange $1.0 million of
the Obligations remaining after the public sale of the assets of
Optex for shares of the new preferred stock upon the completion of
a $1.0 million bridge debt financing.

The Lenders have also agreed to exchange the balance of the
Obligations for shares of the new preferred stock in the event the
Company consummates either of these:

   -- securing a new debt facility with net proceeds of at least
      $2.0 million; or

   -- completing an equity offering with net proceeds of at least
      $2.0 million.

Pursuant to the MOU, the Lenders have provided their consent to
the foregoing debt or equity offerings.  The new preferred stock
will not be issued until the closing of the equity offering
described above, or if no closing occurs, then at a mutually
agreed upon time.  The conversion of the new preferred stock into
shares of the Company's common stock will be subject to the same
conversion blocker as contained in the Company's existing Series
A-1 Preferred Stock.

The Lenders have agreed to forebear in the exercise of their
rights or remedies in the loan documents related to the
Obligations or under law with respect to the Company or any of its
assets (other than Optex) except to effect the public sale of the
Optex assets in accordance with the MOU, to enforce this MOU or to
obtain certain indemnification rights, but the forbearance is
subject to termination upon the occurrence of certain enumerated
events set forth in the MOU.

The MOU also contemplates an orderly transition of Optex's
operations to maintain its on-going business and obligates the
Lenders to negotiate in good faith with the Company regarding a
possible future contract manufacturing and consulting relationship
following the public sale.

                        About Irvine Sensors

Based in Costa Mesa, Calif., Irvine Sensors Corporation
(Nasdaq: IRSN) -- http://www.irvine-sensors.com/-- is a vision
systems company engaged in the development and sale of
miniaturized infrared and electro-optical cameras, image
processors and stacked chip assemblies, the manufacture and sale
of optical systems and equipment for military applications through
its Optex subsidiary and research and development related to high
density electronics, miniaturized sensors, optical interconnection
technology, high speed network security, image processing and low-
power analog and mixed-signal integrated circuits for diverse
systems applications.

                        Going Concern Doubt

The company generated net losses in fiscal 2005, fiscal 2006,
fiscal 2007 and the 39 weeks ended June 29, 2008.  At June 29,
2008, the company's accumulated deficit was $156,444,700.

The company said it engaged an investment banking firm in
June 2008 to assist it in raising additional capital.  Failure to
successfuly raise capital would have a material and adverse effect
on the company's financial condition, which may result in defaults
under its loan and preferred stock instruments.  The company said
these conditions create substantial doubt about its ability to
continue as a going concern.

                           Balance Sheet

At June 29, 2008, the company's consolidated balance sheet showed
$31,519,400 in total assets, $28,794,000 in total liabilities, and
$2,725,400 in total stockholders' equity.

The company's consolidated balance sheet at June 29, 2008, also
showed strained liquidity with $12,104,000 in total current assets
available to pay $12,667,800 in total current liabilities.  The
decline in working capital was substantially due to the
reclassification of the $2.0 million debt owed by Optex Systems
Inc., a wholly owned subsidiary, to TWL Group, LP, an entity owned
by Timothy Looney, that is due upon the earlier of Feb. 27, 2009,
or sixty days after all debt to the company's senior lenders is
refinanced or retired in full.


LAS VEGAS SANDS: Secures $475 Billion Loan From CEO
---------------------------------------------------
Las Vegas Sands Corp.'s chairperson, CEO and stockholder Sheldon
G. Adelson completed an investment in the company of $475 million
in convertible senior notes in a private transaction to the
company.

The convertible senior notes mature on Oct. 1, 2013, pay cash
interest at 6.5% and are convertible into common stock at a price
of $49.65.

Tamara Audi at The Wall Street Journal relates that the loan will
help Las Vegas Sands avoid breaking the terms of a
$5 billion credit facility, which analysts say was tied to certain
cash-flow requirements that the company risked missing.  The terms
of the Las Vegas Sands credit facility dictate that the company's
debt cannot exceed 7.5 times its cash flow.

Breaking the covenant could have affected Las Vegas Sands' ability
to borrow "down the road," WSJ says, citing the analysts.  The
report states that borrowing from Mr. Adelson indicates how
difficult borrowing has become.  "This was the least costly and
best option for the company," the report quoted Mr. Adelson as
saying.  

WSJ relates that investors and analysts had speculated over how
Las Vegas Sands would make it through a cash-flow shortage that
would have put it out of compliance with its loan terms, and the
difficulty in renegotiating with lenders amids the Wall Street
crisis.

Las Vegas Sands is seeking $3.3 billion to refinance an existing
loan, and almost $2 billion to finance a portion of its project in
Macau, accoridng to WSJ.  Las Vegas Sands might decide against
refinancing the $3.3 billion loan "the more onerous the terms get
in this market," but the company is continuing to pursue financing
for the Macau project with Asian banks, which aren't as affected
as U.S. banks, WSJ states, citing Mr. Adelson.

                     About Las Vegas Sands

Las Vegas Sands Corp. owns and operates The Venetian Resort Hotel
Casino, and The Palazzo Resort Hotel Casino. With the opening of
The Palazzo, these Las Vegas properties, situated on or near the
Las Vegas Strip, form an integrated resort.  The Company also owns
and operates the Sands Macao, the first Las Vegas-style casino in
Macao, China, pursuant to a 20-year gaming subconcession.  On Aug.
28, 2007, under the same gaming subconcession as the Sands Macao,
the Company opened The Venetian Macao Resort Hotel, which anchors
the Cotai Stript, a master-planned development of resort
properties in Macao, China.

                           *     *     *

As reported by the Troubled Company Reporter on Sept. 24, 2008,
Standard & Poor's Ratings Services lowered its corporate credit
and issue-level ratings on the Las Vegas Sands Corp. family of
companies, including Las Vegas Sands LLC, its Venetian Casino
Resort LLC subsidiary, and affiliate VML U.S. Finance LLC, by one
notch.  The corporate credit rating was lowered to 'B+' from
'BB-'.  The corporate credit and issue-level ratings remain on
CreditWatch with negative implications, where they were initially
placed on July 16, 2008.
     
"The downgrade reflects increased concerns around LVSC's liquidity
position, given current issues in the capital markets, continued
weak performance on the Las Vegas Strip, and the potential for a
significant slowdown of the growth trajectory in Macau, all while
the company seeks a significant amount of capital to fund its
development pipeline," explained Standard & Poor's credit analyst
Ben Bubeck.


LATTICE INC: Earns $4.25 Million in 2008 Second Quarter
-------------------------------------------------------
Lattice Inc. reported net income of $4.25 million for the second
quarter ended June 30, 2008, compared with net income of
$1.73 million in the corresponding period in 2007.

"We are very pleased with the progress we made during the second
quarter on the execution of our business plan, and in particular
with the share exchange agreement [with Barron Partners LP] that
has greatly simplified our capital structure and we believe will
provide us with the financial flexibility to refocus our efforts
on growing our business," said Paul Burgess, Lattice's chief
executive officer.  "We are also pleased with our top line
performance in this difficult environment as well as the
significant improvement in our bottom line during the quarter.  As
we look to the future we will continue to strengthen our marketing
and business development organization to build on our unique
technologies to accelerate our growth into 2009."

                   Second Quarter 2008 Results

Lattice's total revenue in the second quarter 2008 was slightly up
at $3.73 million, compared to $3.72 million in the same period
last year.  Revenue generation was driven by follow-on orders from
key existing contracts.  Services and solutions to the Federal
government accounted for 95% of the company's revenues in the
quarter.

Cost of revenues increased to $2.71 million from $1.68 million in
the same period of 2007.  Gross profit in the second quarter was
$1.01 million compared to $2.04 million in the comparable period
of 2008.  As a percent of revenues, gross profit margin was 27.2%
in the second quarter of 2008, down from 54.7% in the second
quarter of 2007.  The year-over-year reduction in gross profit and
gross margin was primarily due to an increase in the use of sub-
contractors on programs the company is the prime-contractor to
support the delivery of its JPMIS Seaport-e contract as well as
other government contract vehicles.

Operating expense for the second quarter of 2008 was
$1.92 million, down from $2.06 million in the comparable period of
2007.  Operating expense in the second quarter of 2008 included
selling, general and administrative expense of $1.44 million,
$150,000 of which was non-recurring legal expenses, research and
development of $109,172 and amortization of $372,057.  Adjusting
for non-recurring items, operating expenses would have been down
approximately 14%, reflecting a reduction in headcount in the
period associated with a higher reliance on subcontractors.

The company posted an operating loss for the second quarter of
$903,181 which compared to operating loss of $20,045 in the second
quarter of 2007.  The operating loss for the second quarter of
2008 included non-cash amortization expense of $372,057 related to
intangible assets associated with the acquisition of RTI in 2006
and SMEI in 2005, compared to a non-cash amortization expense of
$520,428 in the same period in 2007.

Other income in the second quarter of 2008 was $4.95 million,
including a non-cash derivative gain of $2.37 million, a gain on
debt extinguishment of $2.61 million and an income tax benefit of
$174,208 related to the carrying value of deferred tax
liabilities.

                          Balance Sheet

At June 30, 2008, the company's consolidated balance sheet showed
$16.04 million in total assets, $9.14 million in total
liabilities, $159,180 in minority interest, and $6.74 million in
total stockholders' equity.

The company's consolidated balance sheet at June 30, 2008, also
showed strained liquidity with $4.45 million in total current
assets available to pay $6.82 million in total current
liabilities.

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?3315

                       Going Concern Doubt

The company has a working capital deficiency of $2.37 million
including non-cash derivative liabilities of $0.79 million.  Due
to the negative operating cash flows and the working capital
deficiency, the company does not have sufficient working capital
to support operations and satisfy debt service payments on
liabilities coming due over the next twelve months.  These
conditions raise substantial doubt regarding the company's ability
to continue as a going concern.

                        About Lattice Inc.

Headquartered in Pennsauken, New Jersey, Lattice Incorporated
(OTC BB: LTTC) -- http://latticeincorporated.com/ -- is a  
provider of advanced information and communications technology
solutions to the government and commercial markets.  The company's
technology services division designs, deploys and manages advanced
technological solutions at key government agencies and for mid- to
large-sized enterprises.  Lattice's technology products division
consists of several core proprietary platforms used to develop
customized software applications with military grade security in a
number of different markets.


LEHMAN BROTHERS: Northern Trust Warns Clients of Losses        
-------------------------------------------------------
Northern Trust Corp. warned clients of its security lending
business that they stand to lose their money as a result of the
Lehman Brothers' bankruptcy and the subprime mortgage crisis, Kaja
Whitehouse of The New York Post reported Saturday.

In a conference call with clients yesterday, a Northern Trust
official said cash put up as collateral in its security-lending
business was invested in funds tied to Lehman debt, which might
now be worthless.

The Northern Trust official told clients that the extent of their
losses will depend on whether they rush to take their money out or
wait until things settle down.

According to The New York Post, when Lehman went bankrupt, lenders
got trapped in two ways: First, they lost their securities on loan
to Lehman and second they lost their collateral by investing it in
Lehman debt.

Northern Trust said clients need not worry about losing securities
loaned to Lehman. The firm said it rushed to retrieve loaned
assets after Lehman went under, securing 70 percent. The firm has
been working to buy back the remaining 30 percent, the official
said.

But on the collateral, it could take months before clients get all
their money back.

Northern Trust Corporation operates as the holding company for The
Northern Trust Company that provides a range of banking and
financial services to large and mid-sized corporations and
financial institutions in the United States and internationally.

Northern Trust Corporation was founded in 1889 and is
headquartered in Chicago, Illinois.


                      About Lehman Brothers

Lehman Brothers Holdings Inc. -- http://www.lehman.com-- is the   
fourth largest investment bank in the United States.  For more
than 150 years, Lehman Brothers has been a leader in the global
financial markets by serving the financial needs of corporations,
governmental units, institutional clients and individuals
worldwide.  Through its team of more than 25,000 employees, Lehman
Brothers offers a full array of financial services in equity and
fixed income sales, trading and research, investment banking,
asset management, private investment management and private
equity.  Its worldwide headquarters in New York and regional
headquarters in London and Tokyo are complemented by a network of
offices in North America, Europe, the Middle East, Latin America
and the Asia Pacific region.  The firm, through predecessor
entities, was founded in 1850.

Lehman filed for chapter 11 bankruptcy September 15, 2008 (Bankr.
S.D.N.Y. Case No.: 08-13555).  Lehman's bankruptcy petition listed
$639 billion in assets and $613 billion in debts, effectively
making the firm's bankruptcy filing the largest in U.S. history.  
The September 15 Chapter 11 filing by Lehman Brothers Holdings,
Inc., does not include any of its subsidiaries.

Subsidiary LB 745 LLC, submitted a Chapter 11 petition on Sept. 16
(Case No. 08-13600).

The Debtors' bankruptcy cases are handled by Judge James M. Peck.  
Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife,
Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil,
Gotshal & Manges, LLP, in New York, represent Lehman.  Epiq
Bankruptcy Solutions serves as claims and noticing agent.

Dennis F. Dunne, Esq., Luc A. Despins, Esq., and Wilbur F. Foster,
Jr., Esq., at MILBANK, TWEED, HADLEY & McCLOY LLP, in New York,
and Paul Aronzon, Esq., and Gregory A. Bray, Esq., at MILBANK in
Los Angeles, California, represent the official unsecured
creditors committee.

                International Operations Collapse

Lehman Brothers International (Europe), the principal UK trading
company in the Lehman group, was placed into administration,
together with Lehman Brothers Ltd., LB Holdings PLC and LB UK RE
Holdings Ltd. These are currently the only UK incorporated
companies in administration.  Tony Lomas, Steven Pearson, Dan
Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers
LLP, have been appointed as joint administrators to Lehman
Brothers International (Europe) on September 15, 2008. The joint
administrators have been appointed to wind down the business.

Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc.
filed for bankruptcy in the Tokyo District Court on September 16.  
The two units of Lehman Brothers Holdings, Inc., which have filed
for bankruptcy protection in the U.S. Bankruptcy Court for the
Southern District of New York, have combined liabilities of JPY4
trillion -- US$38 billion).  Lehman Brothers Japan Inc. reported
about JPY3.4 trillion ($33 billion) in liabilities in its
petition.  Akio Katsuragi, a former Morgan Stanley executive, runs
Lehman's Japan units.

Lehman Brothers Asia Limited, Lehman Brothers Securities Asia
Limited and Lehman Brothers Futures Asia Limited have suspended
its operations with immediate effect, including ceasing to trade
on the Hong Kong Securities Exchange and Hong Kong Futures
Exchange, until further notice.  The Asian units' asset management
company, Lehman Brothers Asset Management Limited, will continue
to operate on a business as usual basis.  A further notice
concerning the retail structured products issued by or arranged by
any Lehman Brothers group company will be issued as soon as
possible, a press statement said.
                       

LE JARDIN: Seeks Court Okay to Hire Moore as Bankruptcy Counsel
---------------------------------------------------------------
Le Jardin, LLC, and its debtor-affiliates seek the U.S. Bankruptcy
Court for the Northern District of Georgia's permission to employ
The Moore Law Group as bankruptcy counsel.

John A. Moore, Esq., a member at the Firm, will, among other
things, advise, assist, and represent the Debtors in their
negotiations with parties in interest and formulate and prepare
required documents.

Mr. Moore will charge the Debtors $200 per hour for his services.

Mr. Moore assures the Court of the Firm's disinterestedness and
that the Firm doesn't hold or represent any interest adverse to
the Debtors' estates.

                          About Le Jardin

Atlanta, Georgia-based Le Jardin, LLC, is a real estate
corporation.  The company and its affiliates filed for Chapter 11
protection on Aug. 29, 2008 (Bankr. N.D.Ga. Case No. 08-77019).  
John A. Moore, Esq., at The Moore Law Group, LLC, represents the
Debtors in their restructuring efforts.  The Debtors listed assets
between $10 million and $50 million and liabilities between
$10 million and $50 million when they filed for bankruptcy.


LENNAR CORPORATION: Posts $88.9 Bln Loss for Quarter Ended Aug. 31
------------------------------------------------------------------
Lennar Corp. posted $88.9 million in net losses on $1.1 billion in
net revenues for the third quarter ended Aug. 31, 2008, compared
with $513.9 million in net losses on $2.34 billion in net revenues
for the third quarter ended Aug. 31, 2007.

The company posted $298.1 million in net losses on $3.3 billion in
net revenues for the six months ended Aug. 31, 2008, compared with
$513.9 million in net losses on $2.34 billion in net revenues for
the three months ended Aug. 31, 2007.

Stuart Miller, President and Chief Executive Officer of Lennar
Corporation, said, "While we expected the housing market to remain
constrained throughout the third quarter, the weakness in the
market actually accelerated as a result of increased foreclosures,
weakened consumer confidence and tightened mortgage lending
standards.  Although the Federal government has recognized that
stabilizing the housing market is critical to solving the current
credit crisis, the government has yet to act meaningfully to help
stabilize home prices.  While we were encouraged that Congress
passed the July housing stimulus bill as a first step, additional
government actions will be necessary to help facilitate housing
market stabilization, which in turn will help stabilize the
financial markets as well."

Mr. Miller continued, "While the housing market continues to
search for a bottom, we have been making significant progress to
improve our basic operations. We continued to focus on the
execution of an efficient homebuilding model through the
repositioning of our product to meet today's cons umer demand and
by aggressively reducing our construction costs. This focus
resulted in our third quarter, pre-impairment gross margin
percentage improvement of 400 basis points year-over-year to
18.0%.  As a result of a steeper decline in revenues than we
anticipated, we did not achieve a reduction in S,G&A expenses as a
percentage of revenue from the second quarter. However, we did
continue to make significant progress towards our goal of right-
sizing our business by cutting our selling, general and
administrative expenses by approximately one-half, compared to a
year ago. We have taken further actions during the quarter,
including consolidating divisions, which should enable us to
achieve a significant improvement in our S,G&A percentage going
forward."

Full copy of Lennar Corp.'s results for the third quarter ended
Aug. 31, 2008 is available at:

               http://researcharchives.com/t/s?32fe

                        About Lennar Corp.

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

                          *     *     *

As reported in the Troubled Company Reporter on June 11, 2008,
Moody's Investors Service lowered all of the ratings of Lennar
Corporation, including its corporate family rating to Ba3 from Ba1
and the ratings on its various issues of senior unsecured notes to
Ba3 from Ba1.  At the same time, a speculative grade liquidity
rating of SGL-2 was assigned.  The ratings outlook remains
negative.


LLC LCG: Voluntary Chapter 11 Case Summary
------------------------------------------
Debtor: LLC LCG Gilroy
        6970 Camino Arroyo
        Gilroy, CA 95020

Bankruptcy Case No.: 08-55561

Type of Business: The Debtor is a real estate investor.

Chapter 11 Petition Date: September 30, 2008

Court: Northern District of California (San Jose)

Judge: Roger L. Efremsky

Debtor's Counsel: Michael St. James, Esq.
                  ecf@stjames-law.com
                  St. James Law
                  155 Montgomery St. #1004
                  San Francisco, CA 94104
                  Tel: (415)391-7566

Estimated Assets: $1 million to $10 million

Estimated Debts: $10 million to $50 million

The Debtor did not file a list of 20 largest unsecured creditors.


LUMINENT MORTGAGE: Plan Not Clear on Creditor Recovery, Panel Says
------------------------------------------------------------------
Bill Rochelle of Bloomberg News reports that the Official
Committee of Unsecured Creditors of Luminent Mortgage
Capital, Inc., and its debtor-affiliates told the U.S. Bankruptcy
Court for the District of Maryland on Sept. 26, 2008, that it
hasn't been able to determine "how much value has been made
available and will be distributed to unsecured creditors" under
the proposed Chapter 11 plan the Debtors filed on Sept. 19.

The Committee, according to the report, says there are
$350 million in unsecured claims aside from that of Arco Capital
Corp, according to the report.

The Court scheduled a hearing to consider approving the Debtors'
disclosure statement on Oct. 16, according to the report.

As reported by the Troubled Company Reporter on Sept. 26, Luminent
Mortgage's plan proposes to implement a prepetition agreement
reached with major creditors before the Debtors' bankruptcy
filing.  Mr. Rochelle earlier reported that the Debtors are
seeking an accelerated approval of the disclosure statement by
Oct. 10, so there is no default under the loan and plan
agreements.

Mr. Rochelle had noted that the disclosure statement is silent on
the actual or estimated recoveries to general unsecured creditors,
which hold $210 million in claims.  The pre-bankruptcy agreement
calls for unsecured creditors other than Arco Capital Corp. to
receive 41% of the stock and $2.75 million, according to Mr.
Rochelle.  He said secured lender Arco is owed $28.9 million and
is slated to receive 51% of the stock under the plan.  Arco is to
provide $3.2 million in financing for the reorganization and $2.8
million after emerging from bankruptcy, according to the report.

The plan is supported by Arco, WaMu Capital Corp. and the holders
of all of the convertible notes, according to the report.  It
cancels existing common and preferred stock and all subordinated
debt, according to the report.

On September 5, the Debtors entered into a Post-Petition Loan and
Security Agreement with Arco.  On September 10, the Bankruptcy
Court authorized the Debtors to enter into the Facility and  
access $400,000.

The Facility provides for loans of up to $3.2 million to fund
post-petition operations and certain reorganization expenses.   
Loans under the Facility bear an interest rate of LIBOR plus 2%
per annum and the maturity date of the Facility is the earlier of
the effective date of a confirmed plan of reorganization,
January 31, 2009, or the termination of the commitment by Arco to
make loans upon the occurance of an event of default or the
acceleration of the outstanding obligations. The Facility is
subject to additional terms and conditions, including the
adherence to an operating budget, and can be terminated at any
time due to an event of default as specified in the Facility at
which time all loans plus accrued interest would become
immediately due and payable. Repayment of the loan is
collateralized by a security interest in property owned by the
Debtors or certain of their subsidiaries.

                    About Luminent Mortgage

Luminent Mortgage Capital, Inc. (OTCBB: LUMCE) is a real estate
investment trust, or REIT, which, together with its subsidiaries,
has historically invested in two core mortgage investment
strategies. Under its Residential Mortgage Credit strategy, the
Company invests in mortgage loans purchased from selected high-
quality providers within certain established criteria as well as
subordinated mortgage-backed securities and other asset-backed
securities that have credit ratings below AAA.  Under its Spread
strategy, the Company invests primarily in U.S. agency and other
highly-rated single-family, adjustable-rate and hybrid adjustable-
rate mortgage-backed securities.

Luminent and nine subsidiaries filed September 5, 2008, for relief
under Chapter 11 of the U.S Bankruptcy Code in the United States
Bankruptcy Court for the District of Maryland, Baltimore Division
(Lead Case No. 08-21389).  Immediately prior to the filing, the
Debtor executed a Plan Support and Forbearance Agreement with
secured creditor Arco Capital Corp., Ltd., WAMU Capital Corp. and
convertible noteholders representing 100% of the outstanding
principal amount of its convertible notes.

Bloomberg News reports that Luminent listed debts of $484,100,000
and assets of $13,400,000 as of July 31, 2008.  Bloomberg adds
that 30 largest unsecured creditors are owed a total of
$221,800,000.  Wells Fargo & Co., indenture trustee for Luminent's
8-1/8% bonds due in 2027, is listed as the largest unsecured
creditor. The principal amount owed under the bonds is
$90,000,000, Bloomberg says.

Luminent and its debtor-subsidiaries continue to operate their
business as debtors-in-possession under the jurisdiction of the
Bankruptcy Court and in accordance with the applicable provisions
of the Bankruptcy Code and orders of the Bankruptcy Court.


LUMINENT MORTGAGE: Creditors Panel Hires Professionals
------------------------------------------------------
BankruptData.com reports that the Official Committee of Unsecured
Creditors of Luminent Mortgage Capital, Inc., and its debtor-
affiliates asked the U.S. Bankruptcy Court for the District of
Maryland for authority to retain Mahoney Cohen & Co., CPA, as its
financial advisor.

According to the report, the Firm will be paid according to the
following hourly rates.:

      Professional                      Hourly Rate
      ------------                      -----------
      Accountant & Senior Staff         $125 - $285
      Manager & Senior Manager          $285 - $425
      Shareholder & Director            $425 - $625

The Committee also asked authority from the Court to retain Arent
Fox as its counsel.  According to the report, the Firm will be
paid according to these hourly rates.:

      Professional                      Hourly Rate
      ------------                      -----------
      Paraprofessional                  $130 - $235
      Associate                         $260 - $465
      Counsel                           $410 - $675
      Partner                           $410 - $710.

The Court also gave authority to the Debtors to retain Hunton &
Williams as counsel and Shapiro Sher Guinot & Sandler as co-
counsel.

                    About Luminent Mortgage

Luminent Mortgage Capital, Inc. (OTCBB: LUMCE) is a real estate
investment trust, or REIT, which, together with its subsidiaries,
has historically invested in two core mortgage investment
strategies. Under its Residential Mortgage Credit strategy, the
Company invests in mortgage loans purchased from selected high-
quality providers within certain established criteria as well as
subordinated mortgage-backed securities and other asset-backed
securities that have credit ratings below AAA.  Under its Spread
strategy, the Company invests primarily in U.S. agency and other
highly-rated single-family, adjustable-rate and hybrid adjustable-
rate mortgage-backed securities.

Luminent and nine subsidiaries filed September 5, 2008, for relief
under Chapter 11 of the U.S Bankruptcy Code in the United States
Bankruptcy Court for the District of Maryland, Baltimore Division
(Lead Case No. 08-21389).  Immediately prior to the filing, the
Debtor executed a Plan Support and Forbearance Agreement with
secured creditor Arco Capital Corp., Ltd., WAMU Capital Corp. and
convertible noteholders representing 100% of the outstanding
principal amount of its convertible notes.

Bloomberg News reports that Luminent listed debts of $484,100,000
and assets of $13,400,000 as of July 31, 2008.  Bloomberg adds
that 30 largest unsecured creditors are owed a total of
$221,800,000.  Wells Fargo & Co., indenture trustee for Luminent's
8-1/8% bonds due in 2027, is listed as the largest unsecured
creditor. The principal amount owed under the bonds is
$90,000,000, Bloomberg says.

Luminent and its debtor-subsidiaries continue to operate their
business as debtors-in-possession under the jurisdiction of the
Bankruptcy Court and in accordance with the applicable provisions
of the Bankruptcy Code and orders of the Bankruptcy Court.


MASONITE INT'L: Inks Forbearance Deal with Secured Lenders
----------------------------------------------------------
Masonite International Inc. disclosed in a Securities and Exchange
Commission filing that on Sept. 16, 2008, it entered into a
forbearance agreement with the lenders that are party to the
company's credit facility.  

Under terms of the forbearance agreement, neither the
administrative agent nor the lenders will:

  (i) take action to accelerate the maturity of or terminate the
      company's revolving credit facility or to otherwise enforce
      payment of the company's obligations under the credit
      agreement; or

(ii) exercise any other rights and remedies available to them
      under the credit agreement or applicable law.

The forbearance agreement applies to the non-compliance by the
company of certain financial covenants as of June 30, 2008 and,
provisionally, any such non-compliance as of Sept. 30, 2008. The
forbearance agreement expires on Nov. 13, 2008, unless further
extended by mutual agreement of the company, the administrative
agent and the lenders.

Also on Sept. 16, 2008, the Agent, on behalf of the lenders, under
the company's credit facility provided notice under the company's
senior subordinated note indentures of the imposition of a payment
blockage period with respect to the company's $769.9 million
senior subordinated notes due 2015.  The notice is permitted by
the terms of the indentures as a result of the company's non-
compliance with certain financial covenants under its credit
facility.  

As a result of the notice, the company may not for a period of up
to 179 days make interest or principal payments under the senior
subordinated notes.  

The next scheduled interest payment on the senior subordinated
notes is due on October 15, 2008.  Failure to make such payment
within 30 days of that date would constitute an event of default
under the note indentures, permitting holders of at least 30% in
principal amount of outstanding notes to declare the full amount
of the notes due and payable.

                Combination Pact with Stile Canada

Masonite International Corporation entered into a combination
agreement in December 2004, with Stile Canada, an entity
controlled by affiliates of Kohlberg Kravis Roberts & Co. L.P.,
which was subsequently amended, pursuant to which on April 6,
2005, Stile Canada acquired all of the common shares of Masonite
International at a purchase price of C$42.25 per share in cash.  
Following the Transaction, Masonite International was amalgamated
with Stile Canada to form Masonite Canada Corporation, which then
transferred all of the common shares of Masonite Holdings, Inc.,
which is the parent company of Masonite International
Corporation's U.S. subsidiaries, to Stile U.S.  Following the
transfer, Masonite Holdings, Inc. was merged with and into Stile
U.S., and the surviving corporation was renamed Masonite
Corporation.  Masonite Canada Corporation was subsequently renamed
Masonite International Corp.

In connection with the Acquisition:

  -- Masonite U.S. and Masonite Canada entered into senior
     secured credit facilities, consisting of a $1.175 billion
     term loan facility, with The Bank of Nova Scotia, as
     Administrative Agent and as Canadian Administrative Agent,
     and the lending syndicate, the proceeds of which were used
     to pay the consideration in the Transaction and related
     costs and expenses, and a $350.0 million revolving credit
     facility, a portion of which is available for the issuance
     of letters of credit and the proceeds of which may be used
     solely for general corporate purposes; and

  -- Masonite U.S. and Masonite Canada entered into a
     $770.0 million senior subordinated loan facility with The
     Bank of Nova Scotia, as Administrative Agent and as Canadian
     Administrative Agent, and the lending parties.

         Masonite's $1.175BB Term Loan & $350MM Revolver

According to the company's annual report for the year ended
December 31, 2007, the eight-year $1.175 billion term loan is due
April 6, 2013, and has an original interest rate of LIBOR plus
2.00% that amortizes at 1% per year.  The $350 million revolving
credit facility interest rate is subject to a pricing grid ranging
from LIBOR plus 1.75% to LIBOR plus 2.50%.  As of December 31,
2007, the revolving credit facility carried an interest rate of
LIBOR plus 2.50%.

The senior secured credit facilities provide for the payment to
the lenders of a commitment fee on the average daily undrawn
commitments under the revolving credit facility at a range from
0.375% to 0.50% per annum, a fronting fee on letters of credit of
0.125%, and a letter of credit fee ranging from 1.75% to 2.50%
(less the 0.125% fronting fee).

The senior secured credit facilities require the company to meet a
minimum interest coverage ratio of 1.65 times Adjusted EBITDA and
a maximum leverage ratio of 7.0 times Adjusted EBITDA as of
December 31, 2007.  These ratios will be adjusted over the passage
of time, ultimately reaching a minimum interest coverage ratio of
2.2 times Adjusted EBITDA, and a maximum leverage ratio of 4.75
times Adjusted EBITDA. In addition, the senior secured credit
facilities contain certain restrictive covenants which, among
other things, limit the incurrence of additional indebtedness,
investments, dividends, transactions with affiliates, asset sales,
acquisitions, mergers and consolidations, prepayments of other
indebtedness, liens and encumbrances and other matters customarily
restricted in such agreements.  They also contain certain
customary events of default, subject to grace periods, as
appropriate.

The company is permitted to incur up to an additional $300 million
of senior secured term debt under the senior secured credit
facilities so long as no default or event of default under the new
senior secured credit facilities has occurred or would occur after
giving effect to such incurrence, and certain other conditions are
satisfied.  The net debt to Adjusted EBITDA calculation measures
the debt the company has on its balance sheet against its Adjusted
EBITDA over the last 12 months. This ratio increased from 5.96:1.0
at December 31, 2006 to 6.00:1.0 at December 31, 2007.  The
company's cash interest coverage ratio measures its Adjusted
EBITDA as a multiple of its cash interest expense over the last 12
months. This ratio was unchanged from the prior year at 1.91:1.0.

            Masonite's $770MM Sr. Sub. Notes Due 2015

The $770 million senior subordinated loan initially carried an
interest rate of LIBOR plus 6.00% and increased over time to a
maximum interest rate of 11% per annum, which was reached in the
second quarter of 2006. On October 6, 2006, the senior
subordinated loan was repaid in full by the automatic issuance of
a new debt obligation comprising a Senior Subordinated Term Loan.  
After October 6, 2006, the majority of the lenders elected to
convert their holdings of the Senior Subordinated Term Loan to
Senior Subordinated Notes due 2015, which bear interest 11%, and
are subject to registration rights.

            About Masonite International Corporation

Based in Ontario, Canada, Masonite International Corporation --
http://www.masonite.com/-- (TSE:MHM) is a vertically integrated    
producer, manufacturing key components of doors, including
composite molded and veneer door facings, glass door lites and cut
stock.  The company provides these products to its customers in
more than 70 countries around the world.  The company is a wholly
owned subsidiary of Masonite International Inc.  It offers a range
of interior and exterior doors.  Masonite Canada operates Masonite
International's Canadian subsidiaries, well as certain other non-
United States subsidiaries.

                           *     *     *

As reported in the Troubled Company Reporter on Sept. 1, 2008,
Standard & Poor's Ratings Services lowered its long-term corporate
credit ratings on Masonite International Inc. (Masonite) and its
subsidiaries, Masonite International Corp. and Masonite US Corp.,
to 'CCC+' from 'B-'. S&P also lowered the senior secured debt
rating on Masonite to 'B' from 'B+'.  The ratings remain on
CreditWatch with negative implications, where they were placed
April 18, 2008.


MATRIX DEVELOPMENT: CEO Oringdulph Sued by Keybank to Recover Debt
------------------------------------------------------------------
Cleveland-Based KeyBank has sued Legend Homes' CEO David
Oringdulph to try to recover $32.5 million in troubled loans that
the homebuilder and its affiliated companies owe the bank, Ryan
Frank of The Oregonian reports.

KeyBank, Legend Homes' largest creditor, sued Mr. Oringdulph and
his trust on Sept. 18 in Multnomah County Circuit Court.  
According to The Oregonian, Mr. Oringdulph issued his personal
guarantee on KeyBank's seven loans.

Mr. Oringdulph said he expected the suit after Legend Homes filed
Chapter 11 bankruptcy in June.  "I've taken steps to protect
myself," he said.  "My personal assets are limited and not in
jeopardy."

KeyBank spokeswoman Anne Foster declined to comment on the
lawsuit.  

The bank extended Legend or its affiliated companies millions of
dollars in loans to buy land for home lots, only to see land
values plummet in the housing slowdown.

Earlier this month, Legend Homes won court approval to resume  
home construction on some subdivisions, and executives hope to re-
emerge from Chapter 11 next year.

                        About Legend Homes

Headquartered in Portland, Oregon, Matrix Development Corp. aka
Legend Homes -- http://www.legendhomes.com-- designs and builds  
homes and condominiums.  The company filed for Chapter 11
protection on June 10, 2008 (Bankr. D. Ore. Case No.08-32798).  
David A. Foraker, Esq. at Greene & Markley P.C. is the Debtor's
counsel.  When the Debtor filed for protection against its
creditors, it listed assets of between $100 million and
$500 million and debts of between $100 million and
$500 million.


MEDCOM USA: Jewett Schwartz Expresses Going Concern Doubt
---------------------------------------------------------
Jewett, Schwartz, Wolfe & Associates raised substantial doubt
about the ability of MedCom USA, Inc., to continue as a going
concern after it audited the company's financial statements for
the year ended June 30, 2008.  

The auditing firm indicated that the company has operating and
liquidity concerns, has incurred an accumulated deficit of
$91,271,451 through the period ended June 30, 2008, and current
liabilities exceeded current assets by $2,914,418 at June 30,
2008.

The company has year-end losses from operations and had minimal
revenues from operations in 2008 and 2007.  During the year ended
June 30, 2008, and 2007, the company incurred net loss of around
$1,050,000 and $2,600,000, respectively.  Further, the company has
inadequate working capital to maintain or develop its operations,
and is dependent upon funds from private investors and the support
of certain stockholders.  These factors raise substantial doubt
about its ability to continue as a going concern.  In this regard,
the management is planning to raise any necessary additional funds
through loans and additional sales of its common stock.  However,
there is no assurance that the company will be successful in
raising additional capital.

The company posted a net loss of $1,045,095 on total revenues of
$2,901,481 for the year ended June 30, 2008, as compared with a
net loss of $2,553,611 on total revenues of $4,004,899 in the
prior year.

At June 30, 2008, the company's balance sheet showed $1,177,025 in
total assets and $6,954,049 in total liabilities, resulting in a
$5,777,024 stockholders' deficit.  

The company's consolidated balance sheet at June 30, 2008, also
showed strained liquidity with $650,966 in total current assets
available to pay $3,565,386 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?3329

                       About MedCom USA

Based in Scottsdale, Ariz., MedCom USA, Inc. (OTC BB: EMED) --
http://www.medcomusa.com/-- provides technology-based solutions   
for the healthcare industry in the United States.  Its solutions
enable the users to collect, use, analyze, and disseminate data
from payers, healthcare providers, and patients.  The company
offers MedCom system that operates through a point-of-sale
terminal or Web portal, which consolidates insurance eligibility
verification; processes medical claims; and monitors referrals.
This system also allows customers to process their medical claims
through an online portal.  

In addition, Medcom USA offers a combination of services for the
collection and approval of credit/debit card payments along with
the personal check guarantee from financial institutions. The
company was founded in 1991 as Sims Communications, Inc., and
changed its name to Medcom USA, Inc., in 1999.


MICHAEL VICK: Sells Belongings to Edward Howard for $10
-------------------------------------------------------
Zimbio.com reports that Michael Dwayne Vick sold a storage unit
full of his personal belongings to Edward Howard for $10.

According to Zimbio.com, Mr. Vick decided to auction his
belongings, including the items of his baby boy, when he failed to
pay his monthly dues. Zimbio.com relates that five people showed
up for the auction last month.  

Mr. Vick had already sold his old bedroom furniture and clothes on
the  street corner and made a few hundred bucks, TMZ relates.

Michael Dwayne Vick, born June 26, 1980 in Newport News, Virginia,
is a suspended National Football League quarterback under contract
with the Atlanta Falcons team. In 2007, a U.S. federal district
court convicted him and several co-defendants of criminal
conspiracy resulting from felonious dog fighting and sentenced him
to serve a 23 months in prison.   He is being held in the United
States Penitentiary at Leavenworth, Kansas.

Mr. Vick is also under indictment for two related Virginia state
felony charges for his role in the dogfighting ring and related
gambling activity. His state trial has been delayed until he is
released from federal prison. He faces a maximum 10-year state
prison term if convicted on both counts.

Mr. Vick filed chapter 11 petition on July 7, 2008 (Bankr. E.D.
Va. Case No. 08-50775). Dennis T. Lewandowski, Esq., and Paul K.
Campsen, Esq., at Kaufman & Canoles, P.C., represent the Debtor in
his restructuring efforts. Mr. Vick listed assets of $10 million
to $50 million and debts of $10 million to $50 million in his
bankruptcy filing.  

                       
MILLENNIUM BIOTECH: June 30 Balance Sheet Upside-Down by $13.9MM
----------------------------------------------------------------
Millennium Biotechnologies Group Inc.'s consolidated balance sheet
at June 30, 2008, showed $1,153,241 in total assets and
$15,124,544 in total liabilities, resulting in a $13,971,303
stockholders' deficit.

At June 30, 2008, the company's consolidated balance sheet also
showed strained liquidity with $1,120,589 in total current assets
available to pay $15,117,004 in total current liabilities.

The company reported a net loss of $3,654,126 on total revenues of
$182,115 for the second quarter ended June 30, 2008, compared with
a net loss of $2,334,183 on total revenues of $159,296 in the same
period last year.

The 56% increase in net loss is due to increased operating
expenses and non-operating expenses related to increased non-cash
outlays and increased interest and financing costs.

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?3317

                       Going Concern Doubt

The company has sustained recurring losses and has accumulated a
significant deficit as of June 30, 2008.  These factors raise
substantial doubt about its ability to continue as a going
concern.

                 About Millennium Biotechnologies

Headquartered in Basking Ridge, N.J., Millennium Biotechnologies
Group, Inc. (OTC BB: MBTG) engages in the research, development
and marketing of specialized nutritional supplements as an adjunct
to medical treatments for select medical conditions, as well as
for athletes.  The company's marketed products are targeted toward
immuno-compromised individuals undergoing medical treatment for
diseases, such as cancer, as well as individuals living with human
immunodeficiency virus (HIV)/acquired immune deficiency syndrome
(AIDS) and wound healing and post-surgical healing and geriatric
among other conditions.  


MONTAGE II: Voluntary Chapter 11 Case Summary
---------------------------------------------
Debtor: Montage II, LLC
        7077 E. Marilyn Road, Suite 130
        Scottsdale, AZ 85254

Bankruptcy Case No.: 08-13221

Chapter 11 Petition Date: September 29, 2008

Court: District of Arizona (Phoenix)

Judge: Sarah Sharer Curley

Debtor's Counsel: D. Lamar Hawkins, Esq.
                  dlh@hs-law.com
                  Hebert Schenk P.C.
                  4742 North 24th Street, Suite 100
                  Phoenix, AZ 85016
                  Tel: (602) 248-8203
                  Fax: (602) 248-8840

Estimated Assets: $10 million to $50 million

Estimated Debts: $10 million to $50 million

The Debtor did not file a list of 20 largest unsecured creditors.



MORTGAGES LTD: In Dispute With Investors on Reorganization Plan
---------------------------------------------------------------
Andrew Johnson at The Arizona Republic reports that Mortgages Ltd.
and its investors are arguing over who should get more input on
the drafting a reorganization plan.

Mortgages Ltd.'s exclusive period to file a Reorganization Plan
expires on Oct. 22.  The report says that Mortgages wants to have
more time to draft the Plan.  The claims deadline, according to
the report, was extended from Oct. 7 to Nov. 21 at the request of
investors' attorneys.  Mortgages wants to file the Plan after Nov.
21 so that it can gauge the size and amount of investor claims,
the report states.

The Arizona Republic relates that the official investors committee
-- represented by Cathy Reece, Esq. -- and Radical Bunny LLC --
whom Mortgages owed $200 million in secured loans and who is
represented by Shelton Freeman, Esq. -- are against extending the
Plan deadline, and demand that they have greater input as to how
claims are dealt with.  According to the report, Ms. Reece and Ms.
Freeman sought court approval on Monday to file a competing
reorganization plan that they claim would better represent the
interest of their clients.  Ms. Reece and Ms. Freeman, says the
report, claimed that the nearly $1 billion in loans that Mortgages
made to developers primarily came from their clients, which like
Mortgages Ltd. raised money from investors.  

The seven borrower settlements that Mortgages filed with the court
on Friday indicate that the company isn't making an effort to
include the investors and Radical Bunny in talks on addressing
issues with borrowers, The Arizona Republic states, citing Ms.
Reece and Ms. Freeman.  The report says that Mortgages agreed to
subordinate investors' interest in the deeds of trust on the loans
so that new lenders make loans on pending projects and be in a
first position, while the borrowers, in exchange, will abandon
current and potential lawsuits against the company.  According to
the report, many of Mortgages' borrowers had accused the firm of
short-funding them, while Mortgages had accused some of the
borrowers of failing to pay the loans that had matured.

The Arizona Republic relates that Mortgages made construction and
property-acquisition loans to mostly commercial developers.  
According to The Arizona Republic, the money Mortgages lent came
from almost 3,000 investors, who invested directly in specific
loans or into funds that own interests in multiple loans.  The
report states that when Mortgages filed for Chapter 11 protection,
it had about $925 million in about 70 loans.

                       About Mortgages

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 --
in 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.


MORTGAGES LTD: Wants Exclusive Period Extended Through Dec. 19
--------------------------------------------------------------
Bill Rochelle of Bloomberg News reports that Mortgages Ltd. asked
the U.S. Bankruptcy Court for the District of Arizona to extend
its exclusive period to file a Chapter 11 plan to until Dec. 19,
2008.  The Debtor, Mr. Rochelle says, explained that its creditors
are asking the Court to move an Oct. 7 deadline for filing claims
to Nov. 21.

The Debtor's exclusive plan-filing period expires Oct. 22.  The
Debtor, according to the report, says it's not feasible to file a
plan until after creditors file their claims.

                        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 --
in 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.


MOTOR COACH: U.S. Trustee Forms Five-Member Committee
-----------------------------------------------------
Bill Rochelle of Bloomberg News reports that the U.S. Trustee
formed the Official Committee of Unsecured Creditors of Motor
Coach Industries International, Inc., and its debtor-affiliates
with five members, including a union, a customer, an indenture
trustee and two suppliers.

According to the report, the Trustee appointed the International
Association of Machinists and Aerospace Workers to the creditors'
panel, along with Greyhound Lines, Inc.  The two suppliers are
Allison Transmission, Inc., and Cummins, Inc., according to the
report.

Wilmington, Delaware-based Motor Coach Industries International,
Inc.-- http://www.mcicoach.com/-- and its subsidiaries   
manufacture intercity coaches for the tour, charter, line-haul,
scheduled service, and commuter transit sectors in the U.S. and
Canada.  They also operate seven sales centers and nine service
centers in the U.S. and Canada and is the industry's supplier of
aftermarket parts for most makes and models.

The Company and its debtor-affiliates filed for separate Chapter
bankrupty protection with the United States Bankruptcy Court for
the District of Delaware on September 15, 2008 (Lead Case No. 08-
12136), to implement a pre-negotiated restructuring plan to be
funded by Franklin Mutual Advisors, LLC and certain of its
affiliates.  The Company's Canadian operations are not included in
the filing.

Kenneth S. Ziman, Esq., and Elisha D. Graff, Esq., at Simpson
Thacher & Bartlett LLP, in New York; and Jason M. Madron, Esq.,
and Lee E. Kaufman, Esq., at Richards Layton & Finger, P.A., in
Wilmington, Delaware, represent the Debtors in their restructuring
efforts.  Kurtzman Carson Consultants LLC serves as claims and
notice agent.  Rothschild Inc. and AlixPartners LLP also provide
restructuring advice.  At the time of filing, the Debtors listed
assets of between $500,000,000 and $1,000,000,000 and liabilities
of between $100,000,000 and $500,000,000.


MRS FIELDS: Confirmation Hearing Today; Plan Objections Are Few
---------------------------------------------------------------
Bill Rochelle of Bloomberg News reports that only three objections
were filed against the prepackaged reorganization plan of Mrs.
Field's Original Cookies, Inc., and its debtor-affiliates.  
According to the report, the association representing store
franchisees filed papers objecting to any last-minute attempt the
Debtors might make to reject contracts with the independent store
owners.  The Internal Revenue Service filed papers wanting its
$216,000 in claims paid in cash immediately, according to the
report.  The third objection came from a former employee,
according to the report.

As reported in yesterday's Troubled Company Reporter,
BankruptcyData.Com said the United States Government, on behalf of
the Internal Revenue Service, objected to the Plan on the grounds
that several articles within the Plan failed to preserve the
setoff and recoupment rights of the IRS.  The TCYB Franchisee
Association also filed an objection to the Plan on the grounds
that it fails to provide non-Debtor parties with adequate notice
of the Debtors' intent to reject executory  contracts with such
parties and, further, the Plan effectively denies such parties due
process of law, according to the report.

As reported by the TCR on August 29, 2008, Hon. Peter J. Walsh
will convene a hearing on Oct. 2, 2008, at 3:00 p.m., to consider
approval of the adequacy of the disclosure statement filed by the
Debtors on Aug. 15, 2008, followed by a confirmation hearing of
their prepackaged Chapter 11  plan of reorganization on the same
date.  The hearing will take place at 824 Market Street, 6th floor
in Wilmington, Delaware.

The Plan will pay allowed unsecured claims in full, and
effectuate, without limitation, these restructuring transactions:

    1. the conversion of Old Notes into a combination of cash, New
       Notes and 87.5% of the equity of MFOC outstanding at the
       effective date of the Plan; and

    2. the conversion of the MFOC note into a combination of cash,
       12.5% of the equity of MFOC outstanding at the effective
       date of the Plan and a warrant to purchase additional
       equity of Reorganized MFOC.

Each holder of an allowed secured notes claim will be entitled to
vote on the Plan.  On the Effective Date, in turn for their
allowed secured notes claims against each of the Debtors, holders
will receive, on a pro rata  basis:

    -- the noteholder cash;
    -- the new notes; and
    -- 87.5% of the equity of the new common equity issued and
       outstanding as of the effective date.

Secured noteholders are expected to recovery 86.5%.

The holders of an allowed MFOC note claim will be entitled to vote
on the Plan.  On the Effective Date, in exchange for their allowed
MFOC Note Claim, Capricorn, will receive:

    -- 12.5% of the new common equity issued and outstanding as of
       the Effective Date;

    -- the warrant;

    -- a payment in the amount of $1.049 million.

The holder of the allowed MFOC equity interest will be entitled to
vote on the Plan.  Holders will not receive any recovery under the
Plan.

                          About Mrs. Fields'

Headquartered in Salt Lake City, Utah, Mrs. Fields' Original
Cookies, Inc. -- http://www.mrsfields.com/-- operates a chain of
cookie and baked goods.  The company and 13 of its affiliates
filed for Chapter 11 protection on Aug. 24, 2008 (Bankr. D. Del.
Lead Case No.08-11953).  David R. Hurst, Esq., at Montgomery
McCracken Walker & Rhoads LLP, represents the Debtors in their
restructuring efforts.  The Debtors selected Epiq Bankruptcy
Services LLC as their claims agent.  When the Debtors filed for
protection from their creditors, they list assets between $500,000
and $1 million, and debts between $100 million and $500 million.


NORTHERN TRUST: Warns Clients of Losses on Lehman's Bankruptcy          
--------------------------------------------------------------
Northern Trust Corp. warned clients of its security lending
business that they stand to lose their money as a result of the
Lehman Brothers' bankruptcy and the subprime mortgage crisis, Kaja
Whitehouse of The New York Post reported Saturday.

In a conference call with clients, a Northern Trust official
said cash put up as collateral in its security-lending business
was invested in funds tied to Lehman debt, which might now be
worthless.

The Northern Trust official told clients that the extent of their
losses will depend on whether they rush to take their money out or
wait until things settle down.

According to The New York Post, when Lehman went bankrupt, lenders
got trapped in two ways: First, they lost their securities on loan
to Lehman and second they lost their collateral by investing it in
Lehman debt.


Northern Trust said clients need not worry about losing securities
loaned to Lehman. The firm said it rushed to retrieve loaned
assets after Lehman went under, securing 70 percent. The firm has
been working to buy back the remaining 30 percent, the official
said.

But on the collateral, it could take months before clients get all
their money back.

Northern Trust Corporation operates as the holding company for The
Northern Trust Company that provides a range of banking and
financial services to large and mid-sized corporations and
financial institutions in the United States and internationally.

Northern Trust Corporation was founded in 1889 and is
headquartered in Chicago, Illinois.


NXT ENERGY: Energy Exploration Changes Name
-------------------------------------------
Energy Exploration Technologies Inc. disclosed in Securities and
Exchange Commission filing that on Sept. 22, 2008, it has changed
its name to NXT Energy Solutions Inc.   

The Company's shareholders approved the name change during the
Nov. 29, 2007, Annual General Meeting.   

"Our name-change to NXT Energy Solutions Inc. will better reflect
our principal activities and now aligns with our trade mark NXT."
states George Liszicasz CEO and President.

The trading symbol for the TSX-V shall remain unchanged.  The
Company cannot confirm at this time whether a trading symbol
change will be required for either the OTCBB or Frankfurt
exchange.

                     About Energy Exploration

Based in Calgary, Alberta, Canada, Energy Exploration Technologies
Inc. (OTC BB: ENXTF; TSX-V: SFD) -- http://www.nxtenergy.com/--    
is in the business of providing wide-area airborne exploration
services to the oil and gas industry.  The company utilizes its
proprietary Stress Field Detection Survey System to offer its
clients a unique service to rapidly identify sub-surface
structures with reservoir potential in sedimentary basins with no
environmental impact.  The value of the service is providing
clients with an efficient, cost effective method of surveying
large tracts of land and delivering an inventory of SFD prospects
with high potential.

                       Going Concern Doubt

As reported in the Troubled Company Reporter on Aug. 28, 2008,
Energy Exploration Technologies Inc. said is in the early stage of
commercializing its SFD technology.  Its ability to generate
cash flow from operations will depend on its ability to service
its existing clients and develop new clients for its SFD services.  
Management also recognizes that this early commercialization phase
can last for several years.  In addition, Energy Exploration said
that consistent with this early stage of commercialization the
company has a significant economic dependency on a few customers.

Energy Exploration Technologies Inc. believes these conditions
cast substantial doubt about its ability to continue as a
going concern.  


OAKRIDGE HOMES: Creditor Asks Court to Appoint Chap. 11 Trustee
---------------------------------------------------------------
Cathay Bank asks the U.S. Bankruptcy Court for the Central
District of California to appoint a Chapter 11 Trustee to oversee
and manage Oakridge Homes, LLC.  Cathay claims that the Debtor has
committed acts of dishonesty, fraud, gross mismanagement before
and after it filed for Chapter 11 protection.

Cathay tells the Court that unless a Chapter 11 trustee is
appointed, the bankruptcy estate -- a 19-lot residential
subdivision on the south side of Southern Oaks Drive, at the
Southern terminus of Old Stone Way, Stevenson Ranch, California --
will suffer as the Debtor is unable to close real and bona-fide
sales of the lots at the property.  Cathay claims that the Debtor
has no operating money or cash.  The Debtor, according to Cathay,
remains unable to finish construction of the project.  With the
declining real estate market, the value of the property will
continue to decrease in value.  A Chapter 11 Trustee can guide the
sale of lots in order to obtain cash for the creditors.

The Debtor told the Court that it had a binding contract
with Dana Kellstrom for the purchase of three of the five lots
that were the subject of the Debtor's prior motion to sell --
which was heard and approved by the Court in July 2008.  Cathay
contends that the contract had expired before the motion was filed
and that Ms. Kellstrom had not given the Debtor any authorization
to include it in the Sale Motion.  Ms. Kellstrom has no interest
in the lots, Cathay says.  

Mr. Kellstrom offered $275,000 for each of the different lots at
the property and another $275,000 to clear the title to Lot 19
that he had already purchased.  Cathay says that it would be
willing to release its lien for a net payment of $320,000.  The
Debtor insisted on amounts approaching $500,000, which is
"unrealistic" in light of the current value of the property,
Cathay says.  Cathay's recent appraisal indicates that the per lot
value for each lot at the project is roughly $316,000 given
current conditions.

Only one of the five lot sales has been closed.  Cathay claims
that "Castro", the alleged purchaser of one of the five lots, has
not been heard from since the Sale Motion.  

A state court receiver was appointed on Feb. 13, 2008, because the
Debtor was unable to secure the necessary permits and reports
required at the property and because the Debtor does not have
enough money to pay the fees associated with those permits or to
complete construction of the project.  The Debtor recently sought
permission from the Court to Cancel Escrow for Lot 14.  
       
A hearing on Cathay's request for a Chapter 11 Trustee is
scheduled for Oct. 21, 2008, at 10:00 a.m., at Courtroom 301.

Based in Valencia, California, Oakridge Homes, LLC is a
homebuilder.  The company filed for Chapter 11 on June 13, 2008
(C.D. Calif. Case No. 08-13977).  Ron Bender, Esq., at Levene,
Neale, Bender, Rankin & Brill LLP, represents the Debtor as
counsel.  The company listed assets of $20,038,129 and liabilities
of $28,552,123.


OMEGA SYTEMS: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Omega Systems, Inc.
        2221 W. Steed Ridge
        Phoenix, AZ 85085

Bankruptcy Case No.: 08-13372

Type of Business: The Debtor offers engineering support services
                  for the United States Marine Corps.
                  See: http://www.omegasys.net/

Chapter 11 Petition Date: September 30, 2008

Court: District of Arizona (Phoenix)

Judge: Charles G. Case II

Debtor's Counsel: Donald W. Powell, Esq.
                  d.powell@cplawfirm.com
                  Carmichael & Powell, P.C.
                  7301 N. 16th Street, #103
                  Phoenix, AZ 85020
                  Tel: (602) 861-0777
                  Fax: (602) 870-0296

Total Assets: $13,308,500

Total Debts: $1,942,805

Debtor's 20 Largest Unsecured Creditors:

   Entity                                            Claim Amount
   ------                                            ------------
Avtec Systems                                        $405,500
14432 Albermarle
Chantily, VA 20151

Fermion LLC
1529 Technology, #101                                $207,815
Chesapeake, VA 23320

Advantech Satellite                                  $180,000
2341 Bould Alfred
Montreal, Quebec, Canada

Satcom Technologies                                  $94,634

Analytic Services Inc.                               $65,422

Insolutions, Inc.                                    $63,111

Chapter 7 Estate of Aloha Network                    $55,000

Teksystems Inc.                                      $51,626

Zellinger Associates Inc.                            $42,665

Intellipower Inc.                                    $30,400

Jenner and Block LLP                                 $20,599

Sumaria Systems Inc.                                 $18,763

Circadence Corporation                               $13,562

Global Technology

ECS Composites                                       $11,704

Ruth-Ann Keasler                                     $10,638

TracStar Systems                                     $9,974

Eagle Global Logistics                               $7,275

Pinnacle Business Financing                          $6,829

WaveStream Corporation                               $5,202


OPEN TEXT: Moody's Upgrades CF Rating to Ba3, Outlook Positive
--------------------------------------------------------------
Moody's Investors Service upgraded Open Text Corp.'s corporate
family rating to Ba3 from B1. Moody's also upgraded Open Text's
senior secured loan facilities to Ba2 from Ba3. The upgrade was
driven by the continued growth in revenues, operating profits and
free cash flow and reduction of debt ahead of plan. The outlook
remains positive reflecting the general trends in the enterprise
content management (ECM) market and expectation of continued
positive operating trends. The ECM market continues to benefit
from the rapidly increasing amount of information that needs to be
organized, stored and retrieved as well as increased compliance
requirements across end users.

The Ba3 rating reflects the company's leading position within the
ECM market and including one of the broadest suites of products
within the industry. The ratings also reflect the high operating
margins (exceeding 14% on a Moody's adjusted basis) and modest
leverage (1.9x as of June 30, 2008 also on a Moody's adjusted
basis). The company's recently announced acquisition of Captaris
is not expected to have an impact on leverage levels. The rating
is constrained by limited diversification outside the ECM sector
as well as the company's potential for additional acquisitions as
they continue to consolidate companies within the sector. The
rating is also constrained by increasing competitive threats from
larger enterprise software and hardware providers who are also
pursuing consolidating strategies within the ECM industry.

The company's senior secured term loan and revolver ratings were
determined using Moody's Loss Given Default Methodology and
reflect the upgrade in the corporate family rating.

These ratings were upgraded:

   Corporate family rating to Ba3 from B1

   Probability of default to B1 from B2

   $75 million senior secured revolver to Ba2, LGD2 (22%) from
Ba3, LGD2 (24%)

   $294 million senior secured term loan to Ba2, LGD2 (22%) from
Ba3, LGD2 (24%)

   The ratings outlook is positive.

The ratings could face upward pressure if the company continues
broadening of its product portfolio and vertical market expertise
while maintaining organic revenue, profit and cash flow growth and
maintaining conservative financial policies. The ratings could
face downward pressure if margins or growth were to deteriorate or
the company was to make a large debt financed acquisition,
particularly if leverage were to exceed 3.5x.

Open Text Corp., headquartered in Waterloo, Ontario, Canada, is
the largest independent provider of enterprise content management
software. The company's software applications allow users to
capture, manage, store, and deliver content (whether documents,
email, web-based material or mixed media) related to
organizational processes. For 12 months ended June 30, 2008,
revenues were $726 million.


PACIFICNET INC: Case Dismissed After Accord With Bondholders
------------------------------------------------------------
Dawn McCarty of Bloomberg News reports that the United States
Bankruptcy Court for the District of Delaware granted the request
of PacificNet, Inc., and bondholders that filed an involuntary
Chapter 11 bankruptcy case against the Debtor, to dismiss the case
after the parties reached a settlement.

                        About PacificNet

Headquartered in Beijing, China, PacificNet Inc., (NasdaqGM:
PACT) -- http://www.pacificnet.com-- provides gaming and mobile
game technology worldwide.  The company, through its
subsidiaries, offers solutions in casino equipment supply; and
the development, installation, and support of systems and game
content for the casino, lottery, and amusement with prizes (AWP)
markets.  The company was founded in 1987 and has additional
offices in Hong Kong, Shanghai, Shenzhen, Guangzhou, Macau, and
Zhuhai, China; the United States; and the Philippines.  Iroquois
Master Fund Ltd., Whalehaven Capital Fund Ltd. and Alpha Capital
AG filed for involuntary Chapter 11 petition against the Debtor on
March 22, 2008, (Bank. D. Del. Case No. 08-10528.)  Adam Friedman,
Esq. at Olshan Grundman, et al. and Robert S. Brady, Esq. and Ian
S. Fredericks, Esq. at Young Conaway, et al. represent the
petitioners in this case. The company's consolidated balance
sheets' posted total assets of $23,356,000 and total liabilities
of $19,527,000, for the quarterly period ended June 30, 2008.


PILGRIM'S PRIDE: Obtains Temporary Waiver for Covenant Violation
----------------------------------------------------------------
Pilgrim's Pride Corporation completed a definitive written
agreement with its lenders to temporarily waive the fixed-charge
coverage ratio covenant under its credit facilities through
Oct. 28, 2008.  The lenders also have agreed to continue to
provide liquidity under these credit facilities during this same
30-day period in accordance with the terms of the waiver
agreement.

Pilgrim's Pride had requested the temporary waiver after
notifying lenders that it expects to report a significant loss
in the fourth quarter of fiscal 2008, which ended Sept. 27, when
it files its Form 10-K for the period.  The company attributed
the anticipated loss to high feed-ingredient costs, continued
weak pricing and demand for breast meat, and the significant
negative impact of hedged grain positions during the quarter.  

The company does not anticipate that any significant hedging gains
or losses will be recognized beyond the fourth quarter of fiscal
2008 on the few positions that remained open past the end of such
period.

Separately, Pilgrim's Pride also announced that it has retained
Bain Corporate Renewal Group to work with management on a range of
strategic issues and operational improvement.  Additionally,
Pilgrim's Pride has engaged Lazard as its investment banker to
provide strategic advice regarding refinancing and
recapitalization opportunities.

                      About Pilgrim's Pride

Headquartered in Pittsburgh, Texas, Pilgrim's Pride Corporation
(NYSE: PPC) -- http://www.pilgrimspride.com/-- produces,
distributes and markets poultry processed products through
retailers, foodservice distributors and restaurants in the U.S.,
Mexico and in Puerto Rico.  Pilgrim's Pride employs about 40,000
people and has major operations in Texas, Alabama, Arkansas,
Georgia, Kentucky, Louisiana, North Carolina, Pennsylvania,
Tennessee, Virginia, West Virginia, Mexico and Puerto Rico, with
other facilities in Arizona, Florida, Iowa, Mississippi and Utah.

                         *     *     *

As reported in the Troubled Company Reporter on Sept. 29, 2008,
Standard & Poor's Ratings Services lowered its ratings on
Pilgrim's Pride Corp., including its corporate credit rating to
'CCC+' from 'BB-'.  In addition, S&P revised the CreditWatch
implications to developing from negative.

Moody's Investors Service lowered the ratings of Pilgrim's Pride
Corporation, including: (i) corporate family rating to B2 from
B1; (ii) probability of default rating to B2 from B1; (iii)
$400 million 7.625% senior notes due 2015 to Caa1 from B3 and  
(iv) $250 million senior subordinated notes due in 2017 and
$5.1 million (original $100 million) senior subordinated notes
due 2013 to Caa1 from B3.


PLATFORM LEARNING: Taps Barton Firm as Substitute Counsel
---------------------------------------------------------
Platform Learning, Inc. asks the U.S. Bankruptcy Court for the
Southern District of New York for authority to employ Barton,
Barton & Plotkin LLP as substitute general bankruptcy counsel,
nunc pro tunc to Sept. 8, 2008.  The Barton Firm will replace
Herrick, Feinstein LLP, the Debtor's primary counsel since the
commencement of its case.

As the Debtor's general bankruptcy counsel, the Barton Firm will
mainly assist and advise the Debtor in performing its duties and
other official functions as are normally required of a Chapter 11
debtor and as set forth in the Bankruptcy Code.

The Barton Firm's professionals bill:

        Professional            Designation     Hourly Rate
        ------------            -----------     -----------
     Eric W. Sleeper, Esq.      Member            $500
     Jessica M. Jimenez, Esq.   Associate         $250
     Courtney Cromwell          Legal Asst.       $175
     Jessica Selecky            Paralegal         $150

To the best of the Debtor's knowledge, the Barton Firm does not
represent any interest adverse to the Debtor or its estate, and
the firm is a "disinterested person" as that term in defined in
Sec. 101(14) of the Bankruptcy Code.

                     About Platform Learning

Headquartered in New York, Platform Learning Inc.
-- http://www.platformlearning.com/-- provides supplemental  
educational services through its Learn-to-Succeed tutoring
program to students attending public schools.  The company filed
for chapter 11 protection on June 21, 2006 (Bankr. S.D.N.Y. Case
No. 06-11391).  Edward Joseph LoBello, Esq., Michael Z.
Brownstein, Esq., and Rocco A. Cavaliere, Esq., at Blank Rome LLP
represent the Official Committee of Unsecured Creditors.  When
the Debtor filed for protection from its creditors, it listed
total assets of $21,026,148, and total debts of $36,933,490.


PROFESSIONAL TRADE: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: Professional Trade Supply of Colorado, Inc.
        dba PTS
        13802 East 33rd Place
        Aurora, CO 80011

Bankruptcy Case No.: 08-25078

Type of Business: The Debtor makes carpets and rugs as well as
                  installation equipment & supplies.

Chapter 11 Petition Date: September 29, 2008

Court: District of Colorado (Denver)

Judge: A. Bruce Campbell

Debtor's Counsel: Lee M. Kutner, Esq.
                  lmk@kutnerlaw.com
                  Kutner Miller Brinen P.C.
                  303 E. 17th Ave., Suite 500
                  Denver, CO 80203
                  Tel: (303) 832-2400

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/cob08-25078.pdf


PROXYMED INC: Completes $23.9 Million Asset Sale to Marlin Equity
-----------------------------------------------------------------
ProxyMed, Inc., dba MedAvant Healthcare Solutions, disclosed in a
Securities and Exchange Commission filing that it completed the
sale of substantially all of its assets to Marlin Equity Partners,
LLC, including, without limitation, the assets associated with the
Company's EDI business, for $23.9 million.

Marlin's final bid was $24.35 million.  The Purchase Price was
reduced by $450,000 -- the amount required to be credited against
Marlin's bid pursuant to the instructions given at the Auction.  
The $450,000 credit represented the amount that would have been
required to be paid to Marlin pursuant to the terms of the Asset
Purchase Agreement as a break-up fee and expense reimbursement.

               About MedAvant Healthcare Solutions

Headquartered in Norcross, Georgia, MedAvant Healthcare Solutions
(NASDAQ:PILL) -- http://www.medavanthealth.com/-- provides
healthcare transaction processing, medical cost containment
services, business process outsourcing services and related value-
added products to physicians, payers, pharmacies, medical
laboratories, and other healthcare suppliers.  MedAvant is a trade
name of ProxyMed, Inc.

ProxyMed Inc., fka MedUnite, Inc., and two of its affiliates filed
for Chapter 11 protection on July 23, 2008, (Bankr. D. Del. Lead
Case No.08-11551).  Kara Hammond Coyle, Esq., and Michael R.
Nestor, Esq., at Young Conaway Stargatt & Taylor, L.L.P., Michael
P. Richman at Foley & Lardner LLP, and Court H. Houseworth at Cain
Brothers & Company LLC represent the Debtors in their
restructuring efforts.

The Debtors indicated $40,655,000 in total consolidated assets and
$47,640,000 in total consolidated debts as of December 31, 2007.
In its petition, ProxyMed Transaction Services, Inc. indicated
$10,000,0000 in estimated assets and $10,000,000 in estimated
debts.
                       

QUEBECOR WORLD: Wants Court to Set December 5 as Claims Bar Date
----------------------------------------------------------------
Quebecor World Inc. and its debtor-affiliates ask the United
States Bankruptcy Court for the Southern District of New York to:

   -- set December 5, 2008, at 5:00 p.m. (Eastern Time) as the
      deadline by which proofs of claim must be filed by the
      Debtors' creditors, including governmental units;

   -- approve the proof of claim form; and

   -- approve the proposed claims procedure.

The Debtors filed their schedules of assets and liabilities and
statements of financial affairs with the Court, and are now
progressing towards the formulation of a plan of reorganization,
Michael J. Canning, Esq., at Arnold & Porter LLP, in New York,
states.  To have a reorganization plan confirmed, it is necessary
for the Debtors to ascertain the nature, extent and scope of the
claims asserted against them, Mr. Canning asserts.

Each person holding a prepetition claim against the Debtors must
file a Proof of Claim before the Bar Date.  The Proof of Claim
must be (i) written in the English language, (ii) signed by the
entity and include supporting documentation, and (iii)
denominated in U.S. currency.  The Proof of Claim must be in the
form substantially similar to the Official Form 10.
        
Any holder of a claim arising from an unexpired lease or
executory contract of the Debtors which was not assigned by the
Debtors prior to the Petition Date, will file a proof of claim so
as to be actually received by the later of (1) the date provided
by the Court's rejection order; or, if no date is provided, then
30 days after the date of the order; and (2) the Bar Date;
provided, however, that if an Agreement is not rejected prior to
the expiration of the Agreement.

Holders of equity security interests in the Debtors need not file
proofs of interest with respect to the ownership of the equity
interests.  

Any individual or entity that is required to file a proof of
claim but that fails to do so by the Bar Date, will be forever
barred from asserting the claim and will be forever discharged
from any and all indebtedness or liability with respect to the
claim.  Moreover, that creditor will neither be permitted to vote
on any plan or plans of the Debtors nor participate in any
distribution in the Debtors' Chapter 11 Cases.

                       About Quebecor World

Based in Montreal, Quebec, Quebecor World Inc. (TSX: IQW) (NYSE:
IQW) -- http://www.quebecorworldinc.com/-- provides market       
solutions, including marketing and advertising activities, well
as print solutions to retailers, branded goods companies,
catalogers and to publishers of magazines, books and other
printed media.  It has 127 printing and related facilities
located in North America, Europe, Latin America and Asia.  In
the United States, it has 82 facilities in 30 states, and is
engaged in the printing of books, magazines, directories, retail
inserts, catalogs and direct mail.

The company has operations in Mexico, Brazil, Colombia, Chile,
Peru, Argentina and the British Virgin Islands.

Quebecor World and 53 of its subsidiaries, including those in
Canada, filed a petition under the Companies' Creditors
Arrangement Act before the Superior Court of Quebec, Commercial
Division, in Montreal, Canada, on Jan. 20, 2008.  The Honorable
Justice Robert Mongeon oversees the CCAA case.  Francois-David
Pare, Esq., at Ogilvy Renault, LLP, represents the Company in
the CCAA case.  Ernst & Young Inc. was appointed as Monitor.

On Jan. 21, 2008, Quebecor World (USA) Inc., its U.S.
subsidiary, along with other U.S. affiliates, filed for chapter
11 bankruptcy on Jan. 21, 2008 (Bankr. S.D.N.Y Lead Case No.
08-10152).  Anthony D. Boccanfuso, Esq., at Arnold & Porter LLP
represents the Debtors in their restructuring efforts.   The
Official Committee of Unsecured Creditors is represented by Akin
Gump Strauss Hauer & Feld LLP.

Based in Corby, Northamptonshire, Quebecor World PLC --
http://www.quebecorworldplc.com/-- is the U.K. subsidiary of       
Quebecor World Inc. that specializes in web offset magazines,
catalogues and specialty print products for marketing and
advertising campaigns.  The company employs around 290 people.
Quebecor PLC was placed into administration with Ian Best and
David Duggins of Ernst & Young LLP appointed as joint
administrators effective Jan. 28, 2008.

As of June 30, 2008, Quebecor World's unaudited consolidated
balance sheet showed total assets of $3,412,100,000 total
liabilities of $4,326,500,000 preferred shares of $62,000,000
and total shareholders' deficit of $976,400,000.

(Quebecor World Inc. News, Issue No. 26; Bankruptcy Creditors'
Service Inc., http://bankrupt.com/newsstand/or 215/945-7000)

   
RELIANT ENERGY: Merrill Lynch Waives Compliance Until October 31
----------------------------------------------------------------
Reliant Energy Inc. and Merrill Lynch have agreed to take steps to
end their credit-enhanced retail structure, given the current
operating environment and Reliant's decision to develop a new
retail strategy aimed at lowering collateral requirements and
providing more consistent earnings. The company has obtained
commitments for $1 billion in new capital to support its business
to facilitate the transition.

"Our retail results in 2008 have been disappointing, due in part
to the recent impact of Hurricane Ike," Mark Jacobs, president
and chief executive officer, Reliant Energy, said.  "We have
also faced unprecedented turmoil in the financial markets.  To
address these challenges, we have determined that terminating
our credit-enhanced retail structure in an orderly manner is
appropriate."

"We have arranged for $1 billion of additional capital," added
Mr. Jacobs.  "Combined with current liquidity of $1.2 billion,
we will have adequate liquidity to facilitate the termination of
the credit-enhanced retail structure.  Certainly, conditions for
raising additional capital are not favorable, however, on balance
we believe these steps are in our best long-term interests."

Reliant Energy disclosed that it is also revising its 2008 outlook
downward to reflect the financial impact of Hurricane Ike and
lower commodity prices in its wholesale business.

The company has lowered its retail contribution margin outlook for
2008 by $300 million to $350 million as a result of the effects of
Hurricane Ike, including reduced sales volumes, the sale of excess
supply during this time, updates to retail pricing assumptions and
increased storm-related operating costs.

In response to its intention to terminate the credit-enhanced
retail structure and current operating environment, Reliant is
developing a new retail strategy aimed at lowering collateral
requirements and providing more consistent earnings.

Commodity prices have fallen significantly since the company
provided its most recent outlook.  In addition, third quarter
results were impacted by mild weather and reduced off-peak
prices. The company estimates that its outlook for 2008 open
wholesale contribution margin will be approximately $480 million
lower than its previous outlook.

These outlook updates exclude any financial impact arising from
termination of the credit-enhanced structure.  Reliant has
arranged for $1 billion in additional capital consisting of a
commitment for a $650 million term loan from GS Loan Partners and
an agreement to issue $350 million of convertible preferred stock
to the energy private equity firm of First Reserve Corporation.

Each of these arrangements is contingent upon completion of
definitive agreements and, among other things, reaching
definitive agreements with Merrill Lynch regarding termination
of the credit-enhanced retail structure.  Reliant and Merrill
Lynch have agreed to use their efforts to negotiate definitive
agreements before Oct. 31, 2008.  Merrill Lynch has waived
compliance with the minimum adjusted EBITDA covenant in the
$300 million retail working capital facility through Oct. 31,
2008, so long as all other covenants are complied with, and
Reliant has agreed to not draw on the retail working capital
facility.

           Material Terms of New Financing Arrangements

The commitment with GS Loan Partners, dated Sept. 29, 2008, for a
$650 million senior secured term loan includes these material
terms:

   -- November 2012 maturity;

   -- issue at 4% closing payment;

   -- initial interest at LIBOR plus 4.50% with LIBOR floor of
      3.75%, or a base rate plus 3.50% with a base rate floor of
      4.75%;

   -- 10% prepayment premium on the amount prepaid during the
      first year, 5% during the second year, 3% during the third
      year and no prepayment premium thereafter;

   -- equally secured with the same collateral that secures
      Reliant's revolving credit agreement, senior secured notes,
      and PEDFA Guarantees;

   -- its subsidiaries, except those contractually prohibited
      from doing so, will be guarantors;

   -- minimum availability and maximum hedging limitations; and

   -- specified levels for the ratios of adjusted net secured
      debt and total debt to adjusted net earnings (loss) before
      interest expense, interest income, income taxes,
      depreciation and amortization (consolidated secured
      leverage and total leverage ratios).

The agreement with First Reserve Fund XII L.P., dated Sept. 29,
2008, providing for the purchase of 350,000 shares of Reliant
convertible participating preferred stock at $1,000 per share
provides for these terms:

   -- cumulative quarterly cash dividends, payable at 14% per
      annum;

   -- convertible at lesser of $11 and lowest 20-day volume
      weighted average price of our common stock during the six
      months after closing, with a floor of $8.00;

   -- holders may require redemption of the preferred stock upon
      a change of control at the greater of (i) face amount plus
      accrued and unpaid dividends, plus a make-whole premium if
      the redemption is before the fifth anniversary or (ii) the
      amount received by common stock holders on an as-converted
      basis;

   -- the company may redeem the preferred stock after the
      third anniversary for the face amount plus accrued and
      unpaid dividends, plus a make-whole premium if the
      redemption is before the fifth anniversary;

   -- holders may require redemption any time after the seventh
      anniversary for the face amount plus accrued and unpaid
      dividends; and

   -- First Reserve may designate one director to our board so
      long as it retains 50% of the initial convertible preferred
      stock or the common stock issued upon conversion.

Full-text copies of the commitment letter with GS Loan Partners
and the letter agreement with First Reserve are available for free
at:

               http://ResearchArchives.com/t/s?331b
               http://ResearchArchives.com/t/s?331c

                      About Reliant Energy

Based in Houston, Reliant Energy Channelview L.P. owns a power
plant located near Houston, and is an indirect wholly owned
subsidiary of Reliant Energy Inc. -- http://www.reliant.com/--
The company and its three affiliates, Reliant Energy Channelview
(Texas) LLC, Reliant Energy Channelview (Delaware) LLC, and
Reliant Energy Services Channelview LLC filed for chapter 11
protection on Aug. 20, 2007 (Bankr. D. Del. Lead Case No.
07-11160).  Jason M. Madron, Esq., Lee E. Kaufman, Esq., Mark D.
Collins, Esq., Paul Noble Heath, Esq., Richards, Robert J. Stearn
Jr., Esq., at Layton & Finger P.A., and Timothy P. Cairns,
Pachulski Stang Ziehl & Jones represent the Debtors.  The U.S.
Trustee for Region 3 appointed an Official Committee of Unsecured
Creditors in these cases.  David B. Stratton, Esq., and Evelyn J.
Meltzer, Esq., at Pepper Hamiltion LLP, represent the Committee.  
When the Debtors filed for protection from their creditors,
they listed total assets of $362,000,000 and total debts of
$342,000,000.

                           *     *     *

As reported in the Troubled Company Reporter on Aug. 12, 2008,
Fitch Ratings has affirmed the ratings of Reliant Energy Inc.
and revised the Ratings Outlook to Stable from Positive.  
Approximately $3 billion of debt is affected.  The ratings
affirmed were: (i) issuer default rating 'B'; (ii) senior secured
debt 'BB/RR1'; (iii) senior unsecured debt 'B+/RR2'; and (iv)
short-term IDR 'B'.


RELIANT ENERGY: Moody's Puts Ba3 CFR on Review for Likely Cut
-------------------------------------------------------------
Moody's Investors Service placed the Ba3 Corporate Family Rating
(CFR) for Reliant Energy (Reliant) and its subsidiaries, Orion
Power Holdings and Reliant Energy Mid-Atlantic Power Holdings, on
review for possible downgrade. The last rating action for Reliant
was on April 28, 2008, when Moody's upgraded the CFR to Ba3 from
B2.

The review for possible downgrade is prompted by Reliant's
Securities and Exchange Commission Form 8-K filing (made on
September 29, 2008), which discloses the magnitude of the business
disruption to Reliant's retail electric provider business
activities and updated the expected near-term outlook for the
wholesale generation business activities. According to the
company, the previous expectations for an improved financial
performance in 2008, increased operating cash flows and a
transition to generating positive free cash flow appears unlikely
over the near-term.

More importantly, Reliant announced a material change to its
overall approach to hedging its retail supply obligations by
announcing a termination of a special credit enhanced retail
structure (a retail credit sleeve) with Merrill Lynch which has
been in place since 2006. In Moody's opinion, the retail credit
sleeve with Merrill Lynch was considered a material credit
positive, primarily because it utilized Merrill Lynch's balance
sheet to provide hedging support to the retail supply obligations.

Finally, Reliant announced its intention to raise approximately
$1.0 billion in capital, $650 million through a new secured term
loan structure (where the secured collateral will be in parity
with Reliant's existing senior secured indebtedness) and $350
million in convertible preferred stock.

The review for possible downgrade will focus on the revised
corporate strategy at Reliant, its intention to adjust its
approach to hedging its retail supplies, the procedures for an
orderly exit from the Merrill Lynch credit sleeve arrangement and
the overall impact to the expected financial profile of the
company.

Reliant Energy is a large wholesale merchant generator with
approximately 16 GWs of generating capacity diversified across
several market regions in the U.S. In addition, Reliant is a large
retail electric provider in Texas, serving almost 2 million
customers, primarily in the greater Houston, Texas region. Reliant
reported $12.4 billion in revenues for the 12 months ended June
2008 and is headquartered in Houston, Texas.

On Review for Possible Downgrade:

   Issuer: Orion Power Holdings, Inc.

      Senior Unsecured Regular Bond/Debenture, Placed on Review
for Possible Downgrade, currently Ba3

   Issuer: Pennsylvania Economic Dev. Fin. Auth.

      Senior Secured Revenue Bonds, Placed on Review for Possible
Downgrade, currently Ba3

   Issuer: Reliant Energy Inc.

      Issuer Rating, Placed on Review for Possible Downgrade,
currently Ba3

      Probability of Default Rating, Placed on Review for Possible
Downgrade, currently Ba3

      Corporate Family Rating, Placed on Review for Possible
Downgrade, currently Ba3

      Multiple Seniority Shelf, Placed on Review for Possible
Downgrade, currently (P)B2

      Senior Secured Regular Bond/Debenture, Placed on Review for
Possible Downgrade, currently B1

      Senior Unsecured Regular Bond/Debenture, Placed on Review
for Possible Downgrade, currently B1

   Issuer: Reliant Energy Mid-Atlantic Power Hldgs., LLC

      Senior Secured Pass-Through, Placed on Review for Possible
Downgrade, currently Ba1

Outlook Actions:

   Issuer: Orion Power Holdings, Inc.

      Outlook, Changed To Rating Under Review From Stable

   Issuer: Reliant Energy Inc.

      Outlook, Changed To Rating Under Review From Stable

   Issuer: Reliant Energy Mid-Atlantic Power Hldgs., LLC

      Outlook, Changed To Rating Under Review From Stable


SEALY CORP: ValueAct Capital, et al., Disclose 3.8% Equity Stake
----------------------------------------------------------------
ValueAct Capital Master Fund III, L.P., VA Partners III, LLC,
ValueAct Capital Management, L.P., ValueAct Capital Management,
LLC, ValueAct Holdings, L.P., ValueAct Holdings GP, LLC, ValueAct
SmallCap Master Fund, L.P., VA SmallCap Partners, LLC, ValueAct
SmallCap Management, L.P., ValueAct SmallCap Management, LLC, and
David Lockwood, disclosed in a Securities and Exchange Commission
filing that they may be deemed to beneficially own 3,471,252
shares of Sealy Corporation's common stock, representing 3.8% of
91,020,819 shares issued and outstanding.

Headquartered in Trinity, N.C., Sealy Corp. (NYSE: ZZ) --
http://www.sealy.com/-- manufactures and markets a broad range of   
mattresses and foundations under the Sealy(R), Sealy
Posturepedic(R), Stearns & Foster(R), and Bassett(R) brands.  
Sealy operates 26 plants in North America, and has the largest
market share and highest consumer awareness of any bedding brand
on the continent.  In the United States, Sealy sells its products
to 2,900 customers with more than 7,000 retail outlets.  Sealy is
also a leading supplier to the hospitality industry.

At June 1, 2008, the company's consolidated balance sheet showed
$1.0 billion in total assets, $1.1 billion in total liabilities,
and $8.1 million in common stock and options subject to
redemption, resulting in a $105.3 million total stockholders'
deficit.

Net income for the second quarter was $12.0 million versus
$16.1 million for the comparable period last year.  Included in
net income for the quarter ended June 1, 2008, were the effects of
a change in the company's estimates for warrantable and other
product return reserves, which provided an $8.2 million benefit to
income from operations.

As of June 1, 2008, the company's debt net of cash was
$743.1 million, compared to net debt of $802.7 million as of
May 27, 2007.

At June 1, 2008, the company had approximately $64.3 million
available under its $125 million revolving credit facility after
taking into account letters of credit issued totaling
$15.9 million.  The company's net weighted average borrowing cost
was 7.6% and 7.5% for the six months ended June 1, 2008, and May
27, 2007, respectively.


SEBASTIAN RIVER: Case Summary & Largest Unsecured Creditor
----------------------------------------------------------
Debtor: Sebastian River Holding Corp.
        c/o Thomas C. Sebastian
        1451 Grand Cayman Drive
        Merritt Island, FL 32952

Bankruptcy Case No.: 08-08812

Chapter 11 Petition Date: September 29, 2008

Court: Middle District of Florida (Orlando)

Debtor's Counsel: David R. McFarlin, Esq.
                  dmcfarlin@whmh.com
                  Wolff, Hill, McFarlin & Herron, P.A.
                  1851 West Colonial Drive
                  Orlando, FL 32804
                  Tel: (407) 648-0058
                  Fax: (407) 648-0681

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/flmb08-08812.pdf


SEMGROUP ENERGY: Inks Forbearance Agreement with Lenders
--------------------------------------------------------
SemGroup Energy Partners, L.P. disclosed in a Securities and
Exchange Commission filing that effective Sept. 18, 2008, SemGroup
Energy Partners, L.P. and Wachovia Bank, National Association, as
administrative agent, letter of credit issuer and swing line
lender; and Bank of America, N.A., as syndication agent, entered
into a Forbearance Agreement and Amendment to Credit Agreement
under which the Lenders agreed, subject to specified limitations
and conditions, to forbear from exercising their rights and
remedies arising from the company's events of default and other
defaults or events of default for the period commencing on
Sept. 18, 2008, and ending on the earlier of:

   -- Dec. 11, 2008,

   -- the occurrence of any default or event of default under the
      Credit Agreement other than certain defaults and events of
      default indicated in the Forbearance Agreement; and

   -- the failure of the company to comply with any of the
      terms of the Forbearance Agreement.  

Prior to the execution of the Forbearance Agreement, the Credit
Agreement was comprised of a $350 revolving credit facility and a
$250 million term loan facility.  As of Sept. 18, 2008, the
company had $448.1 million in outstanding borrowings under its
credit facility (including $198.1 million under its revolving
credit facility and $250 million under its term loan facility).

The Forbearance Agreement permanently reduced the company's
revolving credit facility under the Credit Agreement from
$350 million to $300 million and prohibits the company from
borrowing additional funds under its revolving credit facility
during the Forbearance Period.  

In addition, under the Forbearance Agreement, the company agreed
to pay the Lenders executing the Forbearance Agreement a fee equal
to 0.25% of the aggregate commitments under the Credit Agreement
after the above described commitment reduction.  

During the Forbearance Period, indebtedness under the Credit
Agreement will bear interest at the company's option, at either:

   -- the administrative agent's prime rate or the federal funds
      rate plus 0.50%, plus an applicable margin that ranges from
      2.75% to 3.75%, depending upon the company's total leverage
      ratio; or

   -- LIBOR plus an applicable margin that ranges from 4.25% to
      5.25%, depending upon the company's total leverage ratio.

Under the Forbearance Agreement, the Lenders' forbearance is
subject to certain conditions, including, among other items,
periodic deliverables and minimum liquidity and maximum cash flow
disbursement requirements.

                 About SemGroup Energy Partners

Tulsa, Oklahoma-based SemGroup Energy Partners, L.P. (Nasdaq:
SGLP) -- http://www.SGLP.com/-- owns and operates a diversified     
portfolio of complementary midstream energy assets.  SemGroup
Energy Partners provides crude oil and liquid asphalt cement
terminalling and storage services and crude oil gathering and
transportation services.  

SemGroup Energy Partners, L.P.'s consolidated balance sheet at
March 31, 2008, showed $262.0 million in total assets and
$316.6 million in total liabilities, resulting in a $54.6 million
partners' deficit.


SHAFI KEISLER: Case Summary & 19 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Shafi Jamal Keisler
        Kelly Lynne Dickens
        267 Kings Grant Road
        Maryville, TN 37804

Bankruptcy Case No.: 08-34321

Chapter 11 Petition Date: September 29, 2008

Court: Eastern District of Tennessee (Knoxville)

Debtor's Counsel: Michael H. Fitzpatrick, Esq.
                  tn20@ecfcbis.com
                  Jenkins & Jenkins Attorneys, PLLC
                  2121 First Tennessee Plaza
                  800 S. Gay St.
                  Knoxville, TN 37929
                  Tel: (865) 524-1873

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/tneb08-34321.pdf
                     
                       
SHELLS SEAFOOD: Closes Restaurants After Filing for Chapter 7
-------------------------------------------------------------
Newsjournalonline.com reports that Shells Seafood Restaurants Inc.
has closed its restaurants in Daytona Beach and in New Smyrna
Beach as a result of the firm's filing for Chapter 7.

As reported in the Troubled Company Reporter on Sept. 30, 2008,
Shells Seafood asked the Hon. Catherine Peek McEwen of the U.S.
Bankruptcy Court for the Middle District of Florida to convert its
Chapter 11 bankruptcy case to a Chapter 7 case.  Attorney Don
Stichter said the company failed to secure new financing or find a
buyer for its restaurants, and had to close its remaining 10
corporate-owned stores.  The only Shells Seafood restaurants that
remain open are four restaurants, which are privately owned.

                       About Shells Seafood

Based in Tampa, Florida, Shells Seafood Restaurants, Inc. aka
Shells of Stuart-Monterey, manages and operates seafood
restaurants in Florida under the name "Shells".  The company filed
for Chapter 11 relief on Sept. 2, 2008 (Bankr. M.D. Fla. Case No.
08-13440).  Don M. Stichter, Esq., at Stichter, Riedel, Blain &
Prosser represent the Debtor as counsel.  When the Debtor filed
for protection from its creditors, it listed assets of $1 million
to $10 million, and debts of $1 million to $10 million.


SIMDAG-ROBEL: Court Denies Request to Use Deposit Interest
----------------------------------------------------------
Michael Hinman at Tampa Bay (Florida) Business Journal reports
that Hon. K. Rodney May of the U.S. Bankruptcy Judge for the
District of Middle Florida denied SimDag/RoBEL LLC's request to
use a portion of almost $15,000 in interest earned on buyer
deposits.

Judge May said that the interest funds will remain with the Title
Agency of Florida Inc. until he decides what to do with it, Tampa
Bay Business states.

According to Tampa Bay Business SimDag/RoBEL wants to use the
money to help maintain the former Trump Tower Tampa site after it
received a violation letter from Tampa city officials in June
2008.  Court documents indicate that SimDag/RoBEL will be
attending a municipal code enforcement hearing scheduled for Oct.
15.

Tampa Bay Business relates that the Tampa city's code enforcement
department said that the Trump site was in a state of disrepair,
with overgrowth of vegetation, accumulation of debris, and a
damaged fence.  The report states that the code enforcement board
could fine SimDag/RoBEL up to $5,000 per day for continued
violations, but fines could reduced if code issues are cleared up
by a certain time.  According to the report, several workers with
hand tools tackled the heaps of overgrown vegetation in the area
on Sept. 25.

Court documents say that SimDag/RoBEL, says Tampa Bay Business,
had made up to $700,000 in interest from buyer deposits of
$19 million.  SimDag/RoBEL, says Tampa Bay Business, had hoped to
use the remaining deposit money toward cleaning up the Trump site.

Tampa Bay Business reports that some buyers opposed SimDag/RoBEL's
plan, including Allena Burge of Burge Holdings, who filed a
response on Sept. 16, claiming that the interest on the escrow
payments is the property of those who made deposits and should not
be used for site maintenance.  

Jay D.R. Magner, who claims that SimDag/RoBEL owed him $240,000,
also asked the Court to deny the request, while another buyer,
Jean Shahnasarian, questioned the amount of money left in the
escrow interest account and said that the interest earned on her
cash deposit of $139,000 alone would've generated more than
$20,000, the report states.  

"There appears to be a significant amount of interest, which is
now apparently missing, and the debtor has not disclosed its
whereabouts and the escrow agent has not reported what may have
happened to the funds if deposited into the account," Ms.
Shahnasarian's attorney, Larry Foyale, Esq. at Kass Shuler Solomon
Spector Foyle & Singer, said in a court filing.

                        About SimDag-Robel

Tampa, Florida-based SimDag/Robel, LLC, owns and operates a real
estate business.  The Debtor filed its Chapter 11 petition on
June 17, 2008 (Bankr. M.D. Fla. Case No. 08-08804).  Judge K.
Rodney May presides over the case.  Adam L. Alpert, Esq., and
Jeffrey W. Warren, Esq., at Bush Ross, P.A., represent the Debtor
in its restructuring efforts.  The Debtor listed assets of
$21,672,801 and debts of $37,047,540.


SOUTHERN STATES: Moody's Puts Caa1 Rating on 2012 Notes on Review
-----------------------------------------------------------------
Moody's Investors Service placed Southern States Cooperative,
Inc.'s Corporate Family, Probability of Default, and Senior
Unsecured Note ratings on review for a possible upgrade. LGD
Assessments are subject to change. The SGL-2 speculative grade
liquidity rating was affirmed.

The review for possible upgrade of the company's ratings reflects
continued positive momentum in sales and operating earnings as the
company successfully executes growth initiatives and realizes
positive impacts on key credit metrics. The review is also
prompted by the company's current syndication of an amended and
restated asset based revolving credit facility which will provide
it with greater availability and an extension in expiration.
Should Moody's remain comfortable that Southern States can sustain
credit metrics at appropriate levels and should the cooperative
successfully close its new revolving credit facilities, its
corporate family rating could be upgraded by one notch.

The ratings were placed on review for possible upgrade. LGD
Assessments are subject to change.

Corporate Family Rating -- B2

Probability of Default Rating -- B2

$87 million guaranteed senior unsecured notes, due 2012 at Caa1

The following rating was affirmed

Speculative Grade Liquidity Rating at SGL-2

Moody's last rating action on Southern States was the October 11,
2007 affirmation of all ratings and the change in outlook to
positive from stable.

Headquartered in Richmond, Virginia, Southern States Cooperative,
Inc. is a diversified supplier of agricultural products and
services, such as fertilizer, seed, crop protectants, animal feed,
petroleum and farm and home supplies. The company reported
revenues of $2.1 billion in FY08.


SOUTHWESTERN VIEWS: Voluntary Chapter 11 Case Summary
-----------------------------------------------------
Debtor: Southwestern Views @ South Mountain, LLC
        7077 E. Marilyn Road, Suite 130
        Scottsdale, AZ 85254

Bankruptcy Case No.: 08-13224

Chapter 11 Petition Date: September 29, 2008

Court: District of Arizona (Phoenix)

Judge: Randolph J. Haines

Debtor's Counsel: D. Lamar Hawkins, Esq.
                  dlh@hs-law.com
                  Hebert Schenk P.C.
                  4742 North 24th Street, Suite 100
                  Phoenix, AZ 85016
                  Tel: (602) 248-8203
                  Fax: (602) 248-8840

Estimated Assets: $1 million to $10 million

Estimated Debts: $1 million to $10 million

The Debtor did not file a list of 20 largest unsecured creditors.


SOVEREIGN BANCORP: Moody's Cuts Preferred Stock Rating to Ba2
-------------------------------------------------------------
Moody's Investors Service downgraded the debt and deposit ratings
of Sovereign Bancorp (senior to Baa2 from Baa1) and its
subsidiaries, including its lead thrift, Sovereign Bank (long term
deposits to Baa1 from A3), and placed all ratings, including the
bank financial strength rating, under review for possible
downgrade.

Moody's said the downgrade was based on the sizable charges that
the company will incur from its exposure to Fannie Mae (FNM) and
Freddie Mac (FRE) preferred stock as well as the loss taken on the
sale of its $750 million CDO portfolio. Additionally, Sovereign
remains exposed to a number of problematic asset portfolios that
could result in further heightened credit costs. These charges
will negatively affect Sovereign's capital position. Additionally,
as a result of these charges, Moody's expects the holding company
will downstream capital to the thrift, decreasing parent company
liquidity.

Although Sovereign's issuance of $1.4 billion of common stock and
an additional $500 million of thrift level subordinated debt in
April had significantly strengthened the company's capital ratios,
the loss on the FNM and FRE preferred stock and CDO portfolio,
coupled with Moody's expectations of heightened credit losses on
Sovereign's other credit exposures, places a strain on Sovereign's
capital ratios.

Moody's said the review will incorporate the extent to which
Sovereign's portfolio concentrations could impact the company's
profitability and capital metrics. Sovereign's problematic
concentrations include its commercial real estate, home equity and
indirect auto portfolios. Sovereign's commercial real estate
portfolio equals approximately 1.7 times Tier 1 capital, with home
equity and indirect auto comprising another 2 times Tier 1
capital. Moody's expects these portfolios to experience heightened
credit costs, given the near term potential for greater economic
stress.

Moody's further said that it will focus not only on the financial
fundamentals, but also on the assumed level of support from Banco
Santander Central Hispano (Santander) which holds a 24.4%
ownership stake. If the support assumption were to decrease, this
would result in the elimination of the current one notch of uplift
to Sovereign's long term ratings.

Moody's will also consider the evolving nature of the actions
taken by regulators in the United States and the ratings
implications of these actions on the firm's various classes of
creditors.

Downgrades:

   Issuer: Independence Community Bank

      Subordinate Regular Bond/Debenture, Downgraded to Baa2 from
Baa1

   Issuer: Independence Community Bank Corp.

      Senior Unsecured Regular Bond/Debenture, Downgraded to Baa2
from Baa1

   Issuer: Sovereign Bancorp, Inc.

      Multiple Seniority Shelf, Downgraded to a range of (P)Ba2 to
(P)Baa2 from a range of (P)Baa3 to (P)Baa1

      Preferred Stock, Downgraded to Ba2 from Baa2

      Senior Unsecured Regular Bond/Debenture, Downgraded to Baa2
from Baa1

   Issuer: Sovereign Bank

      Issuer Rating, Downgraded to Baa1 from A3

      OSO Senior Unsecured OSO Rating, Downgraded to Baa1 from A3

      Subordinate Regular Bond/Debenture, Downgraded to Baa2 from
Baa1

      Senior Unsecured Deposit Note/Takedown, Downgraded to Baa1
from A3

      Senior Unsecured Deposit Rating, Downgraded to Baa1 from A3

   Issuer: Sovereign Capital Trust I

      Preferred Stock Preferred Stock, Downgraded to Baa3 from
Baa2

   Issuer: Sovereign Capital Trust II

      Preferred Stock Preferred Stock, Downgraded to Baa3 from
Baa2

   Issuer: Sovereign Capital Trust III

      Preferred Stock Preferred Stock, Downgraded to Baa3 from
Baa2

      Preferred Stock Shelf, Downgraded to (P)Baa3 from (P)Baa2

   Issuer: Sovereign Capital Trust IV

      Preferred Stock Preferred Stock, Downgraded to Baa3 from
Baa2

      Preferred Stock Shelf, Downgraded to (P)Baa3 from (P)Baa2

   Issuer: Sovereign Capital Trust V

      Preferred Stock Preferred Stock, Downgraded to Baa3 from
Baa2

      Preferred Stock Shelf, Downgraded to (P)Baa3 from (P)Baa2

   Issuer: Sovereign Capital Trust VI

      Preferred Stock Preferred Stock, Downgraded to Baa3 from
Baa2

      Preferred Stock Shelf, Downgraded to (P)Baa3 from (P)Baa2

   Issuer: Sovereign Real Estate Investment Trust

      Preferred Stock Preferred Stock, Downgraded to Baa3 from
Baa2

On Review for Possible Downgrade:

   Issuer: Sovereign Bank

      Bank Financial Strength Rating, Placed on Review for
Possible Downgrade, currently C-

      OSO Rating, Placed on Review for Possible Downgrade,
currently P-2

      Deposit Rating, Placed on Review for Possible Downgrade,
currently P-2

Outlook Actions:

   Issuer: Independence Community Bank

      Outlook, Changed To Rating Under Review From Stable

   Issuer: Independence Community Bank Corp.

      Outlook, Changed To Rating Under Review From Stable

   Issuer: Sovereign Bancorp, Inc.

      Outlook, Changed To Rating Under Review From Stable

   Issuer: Sovereign Bank

      Outlook, Changed To Rating Under Review From Stable

   Issuer: Sovereign Capital Trust I

      Outlook, Changed To Rating Under Review From Stable

   Issuer: Sovereign Capital Trust II

      Outlook, Changed To Rating Under Review From Stable

   Issuer: Sovereign Capital Trust III

      Outlook, Changed To Rating Under Review From Stable

   Issuer: Sovereign Capital Trust IV

      Outlook, Changed To Rating Under Review From Stable

   Issuer: Sovereign Capital Trust V

      Outlook, Changed To Rating Under Review From Stable

   Issuer: Sovereign Capital Trust VI

      Outlook, Changed To Rating Under Review From Stable

   Issuer: Sovereign Real Estate Investment Trust

      Outlook, Changed To Rating Under Review From Stable

Sovereign Bancorp, Inc. headquartered in Wyomissing, PA, reported
assets of $79.2 billion as of June 30, 2008.

                       
SPHERICS INC: Finn Warnke to Auction Intellectual Assets Oct. 10
----------------------------------------------------------------
Joseph F. Finn Jr., C.P.A., Assignee of the assets of Spherics
Inc. for the benefit of creditors, said, in an interview, that
interest in the company's therapeutic drugs and technology
platforms was strong.  Numerous confidential agreements have been
signed and conference calls between the company's science team and
prospective buyers have been productive and informative.  The
intellectual property will be sold at a sealed bid auction on
Oct. 10, 2008.

Persons interested in bidding must sign a Confidentiality
Agreement obtained from Mr. Finn's office.  Mr. Finn can be
reached by e-mail at jffinnjr@earthlink.net and by phone at (781)
237-8840.  Parties will then receive a bid package and access to
the Spherics electronic data room.

Mr. Finn is the founding partner of the firm Finn, Warnke &
Gayton, Certified Public Accountants of Wellesley Hills,
Massachusetts.  He works in the area of management consulting for
distressed enterprises, bankruptcy accounting and related matters,
such as assignee for the benefit of creditors and liquidating
agent for a corporation.

Spherics Inc. has an intellectual property position around its
drug delivery technologies and products.  The company has a range
of issued US and international patents through exclusive licenses
from Brown University.  These patents cover polyanhydride-based
bioadhesive polymers and PIN.  In addition to these issued
patents, Spherics has filed numerous applications covering
compositions of matters of its proprietary polymers (SPHEROMERS),
novel oral delivery systems (including BIOGIT, BIOROD and PIN),
manufacturing methods, methods of use, formulations and product
compositions.


SUNWEST MANAGEMENT: Cannot Pay Bills, Says Chief Financial Officer
------------------------------------------------------------------
Sunwest Management Inc. owners Jon Harder and Darryl Fisher may be
on the brink of a Wall Street-scale, billion-dollar business
failure, according to court documents and testimony by company
officials, Diane Dietz of The Register-Guard (Eugene, Oregon)
reported Sept. 28, 2008.

According to The Register-Guard, Sunwest's chief financial officer
said in a recent Lane County court proceeding that about 100 of
300 companies they created -- mainly to provide assisted living
for the elderly in 37 states -- can no longer pay their bills.  
The Sunwest entities hold more than $1.8 billion in debt.  A half-
dozen lawsuits have been filed against them in the past two
months.

Banks that loaned more than $600 million to those companies are
nervously eyeing the Sunwest-related debt.  Several have called in
loans after just one or two late payments from the Salem-based
company; two lenders recently went to court to foreclose and
install receivers at Sunwest facilities, including at Alpine
Springs in Eugene and Briarwood Retirement and Assisted Living in
Springfield.

When Sunwest executives were still talking with reporters last
summer, they blamed their problems on the general malaise of the
economy, the slow housing market and the dearth of business
lending.

"They created a tenuous situation themselves," Portland lawyer
Gary Grenley, who represents investors, said of the company's
founders.  "They just had a bigger appetite than stomach size.  
The guys that are running Sunwest are young guys - young guys
who've never been through the kind of market we're facing right
now.  They may not have been planning prudently or  
conservatively."

Twenty five of 57 Sunwest assisted living facilities in Oregon are
up for sale, but the company has not identified which ones.

A Sunwest affiliate is still working on an $8.8 million, 200-unit
retirement home on Garden Way in Eugene -- but the major lender on
the project, INTERVEST-Mortgage Investment Company, has taken over
the job of paying subcontractors.

Steven Ungar, a Portland attorney who represents Sunwest but not
the individuals who run it, declined specific comment, saying:
"The company has made a determination that the best way to address
allegations made against it - and issues raised in the litigation
filed - is in the courtroom rather than in the media."

The critics say Sunwest's owners should have seen the problems
coming.  "They acquired too many properties and too much debt in a
short period of time.  They're overburdened with a huge amount of
debt service and some properties are not performing well," said
Mr. Grenley.

Sunwest's most immediate problem is the $300 million it owes to GE
Healthcare, which is the subject of around-the-clock negotiations,
Mr. Ungar said.  "The hope and anticipation is (resolution) as
soon as possible.  But the current economic crisis the country,
and the entire world, finds itself in is greatly impacting both
the company's options and the timeline."

The best hope would be to sell off a large piece of the company to
raise money to stave off lenders, said Bill Reeve, who operates a
half-dozen retirement centers in the Northwest.  Sunwest put about
half of its facilities on the market this summer hoping to raise
as much as $1.5 billion, but no sale has emerged.

                     About Sunwest Management

Headquartered in Salem, Oregon, Sunwest Management Inc.
-- http://www.sunwestmanagement.com/-- manages 275 assisted-
living facilities in 37 states.  Sunwest Management was founded in
1991 with a portfolio of three properties: two retirement
communities and one skilled nursing community.  

Sunwest Management Inc. has put 10 assisted living centers - two
in Oregon - into Chapter 11 bankruptcy.  Briarwood Retirement and
Assisted Living Community LLC, which owns a retirement center in
Springfield, and Century Fields Retirement and Assisted Living
Community LLC, which owns a center in Lebanon, filed for Chapter
11 on Aug. 19, 2008.  On Aug. 17, 2008, eight Sunwest-affiliated
LLCs filed for Chapter 11 bankruptcy protection from creditors in
Tennessee.


TATONKA OIL: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: Tatonka Oil & Gas Company, Inc.
        950 17th Street
        Suite 2300
        Denver, CO 80202

Bankruptcy Case No.: 08-25082

Chapter 11 Petition Date: September 29, 2008

Court: District of Colorado (Denver)

Judge: Sidney B. Brooks

Debtor's Counsel: Lee M. Kutner, Esq.
                  lmk@kutnerlaw.com
                  303 E. 17th Avenue, Suite 500
                  Denver, CO 80203
                  Tel: (303) 832-2400

Estimated Assets: $1 million to $10 million

Estimated Debts: $1 million to $10 million

Tatonka Oil's list of 20 largest unsecured creditors is available
for free at:

               http://researcharchives.com/t/s?3323


TATONKA OIL: Case Summary & Six Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Tatonka Oil & Gas, Inc.
        950 17th Street, Suite 2300
        Denver, CO 80202

Bankruptcy Case No.: 08-25084

Type of Business: The Debtor engages in oil and gas exploration.  
                  The company extracts methane gas from coalbeds
                  and oil from fractured shales.

Chapter 11 Petition Date: September 29, 2008

Court: District of Colorado (Denver)

Judge: Howard R. Tallman

Debtor's Counsel: Lee M. Kutner, Esq.
                  lmk@kutnerlaw.com
                  Kutner Miller Brinen P.C.
                  303 E. 17th Ave., Suite 500
                  Denver, CO 80203
                  Tel: (303) 832-2400

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

Estimated Debts: Less than $50,000

A list of the Debtor's largest unsecured creditors is available
for free at:

             http://bankrupt.com/misc/cob08-25084.pdf


TEKOIL & GAS: Files List of 20 Largest Unsecured Creditors
----------------------------------------------------------
Tekoil and Gas Gulf Coast, LLC, has filed a list of its 20 largest
creditors holding unsecured claims.

     Debtor                   Nature of Claim   Amount of Claim
     ------                   ---------------   ---------------
J Aron & Company
Attn: Steve Bunkin
85 Braod Street    
New York, NY 10004                                   $1,475,667     

Prosper Operators, Inc.
P.O. Box 52134
Lafayette, LA 70505
Tel: (337) 267-7440                                    $831,225

Plains Marketing, L.P.
P.O. Box 4648
Houston, TX 77210
Tel: (800) 288-9393                                    $571,291

Trans Tech International
Chemicals
P.O.Box 4648
Houston, TX 77210
Tel: (800) 772-7589                                   $ 537,641

Chambers County Tax Assessor
P.O. Box 519
Anahuac, TX 77514
Tel: (409) 267-8304                                    $400,255

Rich Holdings, LLC              Royalty Owner
14810 Las Mananas Drive
Rancho Santa Fe, CA 92067
Tel: (832) 465-3993                                    $277,506

Exterran Energy Solutions
P.O. Box 670089
Houston, Texas 77267-0089
Tel: (281) 576-2221                                    $264,611

Galveston Bay Construction
P.O. Box 499
Stowell, TX 77661
Tel: (409) 296-4814                                    $255,043

Barton, John W.                 Royalty Owner
102 Lakeside VAlley Drive
Houston, TX 77042
Tel: (713) 266-0936                                    $235,104

Moss Oil Field Construction
Services, LLC
11221 Katy Frwy.
Houston, TX 77079
Tel: (832) 333-7900                                    $167,897

Kiva Construction
P.O. Box 40
Anahuac, TX 77514
Tel: (409) 252-3211                                    $151,158

Peninsula Marine, Inc.
P.O. Box 501
Port Bolivar, TX 77650
Tel: (409) 684-8624                                    $102,692

Perf-O-Log, Inc.
P.O. Box 200050
Dallas, TX 75320-0050
Tel: (337) 269-1245                                     $92,648

J-W Power Company
P.O. Box 970490
Dallas, TX 75397-0490
Tel: (972) 233-8191                                     $81,005

Sierra Engineering
P.O. Box 50203
Midland, TX 79710
Tel: (432) 683-8000                                     $80,000

Star S Maintenance Sales, Inc.
P.O. Box 769
Bellville, TX 77380
Tel: (979) 836-7711                                     $75,533

Charter Marine, LLC
P.O. Box 52213
Lafayette, LA 70505
Tel: (337) 232-9723                                     $69,530

Garcia, Cris                         Royalty Owner
8585 Woodway Drive, Suite 1214
Houston, TX 77063
Tel: (713) 974-0851                                     $65,265

Jerry Patterson, Commissioner        Royalty Owner
Texas General Land Office
P.O. Box 12873
Austin, TX 78711-2873
Tel: (512) 463-5001                                     $64,628

                           About Tekoil

Spring, Texas-based Tekoil and Gas Gulf Coast, LLC, is an
acquisition subsidiary of Tekoil & Gas Corp. -- a technology-
driven company focused on the development, acquisition,
stimulation, rehabilitation and asset improvement of small to
medium-sized oil and gas fields.

The company filed for Chapter 11 protection on Aug. 29, 2008
(Bankr. S.D. Texas Case No. 08-80405).  Patrick J Neligan, Jr.,
Esq., at Neligan Foley LLP represents the company in its
restructuring effort.  The company listed assets of between
$50 million and $100 million and debts of between $10 million and
$50 million.


THORNBURG MORTGAGE: Amends Exchange Offer & Extends Deadline
------------------------------------------------------------
Thornburg Mortgage, Inc. disclosed in a Securities and Exchange
Commission filing it is amending its Exchange Offer and Consent
Solicitation because the conditions that the Exchange Offer comply
with applicable laws were not satisfied prior to 5:00 p.m., New
York City time, on Sept. 30, 2008, the expiration of the Exchange
Offer.

Unless a satisfactory agreement was reached with the reverse
repurchase agreement counterparties that are party to the Override
Agreement dated as of March 17, 2008, as amended, the conditions
that the Exchange Offer complies with applicable law as of the
expiration of the Exchange Offer could not be satisfied due to
certain requirements of Maryland law.  The company has been unable
resolve these issues in order to consummate the Exchange Offer.

Therefore, the company is amending its Exchange Offer for all
outstanding shares of its 8.00% Series C Cumulative Redeemable
Preferred Stock, Series D Adjusting Rate Cumulative Redeemable
Preferred Stock, 7.50% Series E Cumulative Convertible Redeemable
Preferred Stockand 10% Series F Cumulative Convertible Redeemable
Preferred Stock to:

   -- eliminate the $5.00 in cash consideration previously offered
      for each share of Preferred Stock; and

   -- change the number of shares of common stock of the company
      offered for each share of Preferred Stock to three shares
      after giving effect to the one-for-ten reverse stock split
      effective on Sept. 26, 2008.  No cash or other consideration
      will be delivered to tendering holders other than the three
      shares (after giving effect to the reverse stock split) of
      common stock for each share of Preferred Stock tendered.

The company intends to apply to the NYSE for a financial viability
exemption from the shareholder approval requirements of the NYSE
with respect to the additional shares of common stock to be issued
in the Exchange Offer.

The company is extending the expiration of the Exchange Offer from
5:00 p.m., New York City time, on Sept. 30, 2008 to 5:00 p.m.,
New York City time, on Oct. 31, 2008, unless further extended or
terminated by the company.

On Sept: 30, 2008, holders of Preferred Stock had tendered
approximately:

   -- 93.6% (6,110,575 shares) of the Series C Preferred Stock;
   -- 94.6% (3,785,079 shares) of the Series D Preferred Stock;
   -- 94.9% (2,999,844 shares) of the Series E Preferred Stock and    
   -- 98.3% (29,818,589 shares) of the Series F Preferred Stock.

Holders who wish to tender their shares of Preferred Stock must
deliver, or cause to be delivered, their shares and other required
documents to the exchange agent before the expiration date.

The company also announced that it has received the consent of a
majority of the participants in the Principal Participation
Agreement, dated March 31, 2008, to extend the deadline by which
it must complete a successful Exchange Offer to Dec. 31, 2008 and
to modify the consideration offered in the Exchange Offer.
Successful completion of the Exchange Offer will satisfy the
Triggering Event, which, among other things, will allow the
Principal Participation Agreement to be terminated and the
interest rate on the Senior Subordinated Secured Notes due 2015 to
be reduced from 18% to 12%.

Due to the failure to satisfy the Triggering Event on or prior to
Sept. 30, 2008, the escrow agreement pursuant to which
approximately $188.6 million has been held by Wilmington Trust
Company was terminated and the escrowed funds are being returned
to the subscribers to the escrow agreement in accordance with its
terms.  The escrowed funds, which had been intended to be used to
satisfy the cash consideration for the Exchange Offer, are no
longer available for such purpose.  Further, on Sept. 30, 2008,
the investors that hold the Senior Subordinated Notes became
entitled to receive their pro rata share (based on the aggregate
principal amount of Senior Subordinated Secured Notes outstanding)
of warrants representing approximately 30 million shares of the
company's common stock prior to giving effect to the reverse stock
split, which the company anticipates issuing promptly.

The Exchange Offer is being made to holders of Preferred Stock in
reliance upon the exemption from the registration requirements of
the Securities Act of 1933.  Investor inquiries about the Exchange
Offer should be directed to the company at 866-222-2093 (toll
free).  Holders of the Preferred Stock are urged to read the
Offering Circular dated July 23, 2008  and all supplements
thereto, which have been filed with the SEC and contains important
information regarding the Exchange Offer.  Requests for copies of
the Offering Circular, all supplements thereto and related
documents may be directed to Georgeson Inc., the information agent
for the Exchange Offer, at 866-399-8748 (toll free).

                  About Thornburg Mortgage Inc.

Based in Santa Fe, New Mexico, Thornburg Mortgage Inc. (NYSE: TMA)
-- http://www.thornburgmortgage.com/-- is a single-family  
residential mortgage lender focused principally on prime and
super-prime borrowers seeking jumbo and super-jumbo adjustable-
rate mortgages.  It originates, acquires, and retains investments
in adjustable and variable rate mortgage assets.  Its ARM assets
comprise of purchased ARM assets and ARM loans, including
traditional ARM assets and hybrid ARM assets.

                          *     *     *

As reported in the Troubled Company Reporter on June 27, 2008,
Moody's Investors Service affirmed Ca and C senior debt and
preferred stock ratings, respectively of Thornburg Mortgage Inc.
Thornburg's Ca debt rating remains under review for possible
downgrade.

Moody's said that Thornburg's efforts to raise capital to avoid
default under its agreements have resulted in the reconfiguration
of its balance sheet with adverse impact on its debt and preferred
equity holders.

As reported in the Troubled Company Reporter on Aug. 11, 2008,
Standard & Poor's said that the completion of Thornburg Mortgage
Inc.'s tender offer for its preferred shares will have an impact
on the rating once complete.  If Thornburg is successful in the
tender offer, S&P would view this as a positive sign.


THORNBURG MORTGAGE: Effects 1-for-10 Reverse Stock Split
--------------------------------------------------------
Thornburg Mortgage, Inc. disclosed in a Securities and Exchange
Commission filing that on Sept. 26, 2008, it filed Articles of
Amendment to its charter, effecting a one-for-ten reverse stock
split of its outstanding shares of common stock, effective upon
filing.  Every 10 outstanding shares of old common stock which
were held as of Sept. 26, 2008, the effective date, were combined
into one share of new common stock.

Any fraction of a share of the Company's common stock that would
otherwise have resulted from the reverse stock split will be
eliminated by rounding the fraction up to the nearest whole share.
Shortly after the effective date, shareholders will receive
instructions regarding the method of exchanging the old stock
certificates for new stock certificates from the Company's
transfer agent.

The Company also filed the Articles of Amendment to its charter
with the State Department of Assessments and Taxation of the state
of Maryland on the same day.

A copy of Thornburg Mortgage's Articles of Amendment is available
for free at: http://researcharchives.com/t/s?32f1

                  About Thornburg Mortgage Inc.

Based in Santa Fe, New Mexico, Thornburg Mortgage Inc. (NYSE: TMA)
-- http://www.thornburgmortgage.com/-- is a
single-family                 
residential mortgage lender focused principally on prime and
super-prime borrowers seeking jumbo and super-jumbo adjustable-
rate mortgages.  It originates, acquires, and retains investments
in adjustable and variable rate mortgage assets.  Its ARM assets
comprise of purchased ARM assets and ARM loans, including
traditional ARM assets and hybrid ARM assets.

                          *     *     *

As reported in the Troubled Company Reporter on June 27, 2008,
Moody's Investors Service affirmed Ca and C senior debt and
preferred stock ratings, respectively of Thornburg Mortgage Inc.
Thornburg's Ca debt rating remains under review for possible
downgrade.

Moody's said that Thornburg's efforts to raise capital to avoid
default under its repo agreements have resulted in the
reconfiguration of its balance sheet with adverse impact on its
debt and preferred equity holders.

As reported in the Troubled Company Reporter on Aug. 11, 2008,
Standard & Poor's said that the completion of Thornburg Mortgage
Inc.'s tender offer for its preferred shares will have an impact
on the rating once complete.  If Thornburg is successful in the
tender offer, S&P would view this as a positive sign.


TIMBER RUN: Voluntary Chapter 11 Case Summary
---------------------------------------------
Debtor: Timber Run Plaza, LLC
        13107 South Morrow Circle
        Dearborn, MI 48126

Bankruptcy Case No.: 08-35119

Chapter 11 Petition Date: September 30, 2008

Court: Northern District of Ohio (Toledo)

Debtor's Counsel: Richard J. Szczepaniak, Esq.
                  rjs1@buckeye-express.com
                  P.O. Box 501
                  Toledo, OH 43697-0501
                  Tel: (567) 455-6651
                  Fax: (419) 242-5959

Estimated Assets: Less than $50,000

Estimated Debts: $1,000,000 to $50,000,000

The Debtor did not file a list of 20 largest unsecured creditors.
                     

TRES TIGRES: Voluntary Chapter 11 Case Summary
----------------------------------------------
Debtor: Tres Tigres Storage, LLC
        938 Linden Avenue
        P.O. Box 1027
        S. San Francisco, CA 94083

Bankruptcy Case No.: 08-31831

Chapter 11 Petition Date: September 29, 2008

Court: Northern District of California (San Francisco)

Judge: Dennis Montali

Debtor's Counsel: John S. Morken, Sr., Esq.
                  jomork@aol.com
                  Morken Law Office
                  760 Market St. #938
                  San Francisco, CA 94102
                  Tel: (415) 391-6140

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

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

The Debtor did not file a list of 20 largest unsecured creditors.


TURKEY HILL: Case Summary & Two Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Turkey Hill Properties, LLC
        189 Industrial Park Road
        Piney Flats, TN 37686

Bankruptcy Case No.: 08-51855

Type of Business: Single Asset Real Estate

Chapter 11 Petition Date: September 26, 2008

Court: Eastern District of Tennessee (Greeneville)

Debtor's Counsel: Mark S. Dessauer, Esq.
                  dessauer@hsdlaw.com
                  Hunter, Smith & Davis
                  1212 North Eastman Road
                  P. O. Box 3740
                  Kingsport, TN 37664
                  Tel: (423) 378-8840
                  Fax: (423) 378-8801

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

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

Debtor's Two Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
   Mountain Commerce Bank      Loans                     $493,000
   P.O. Box                                               $89,000
   Erwin, TN 37650

   Sullivan County Trustee     Property Taxes              $2,100
   Sullivan County Courthouse
   3411 Highway 126, Suite 104
   Blountville, TN 37617


TWIN HOLLOW: Voluntary Chapter 11 Case Summary
----------------------------------------------
Debtor: Twin Hollow, LLC
        115 West Westview Drive
        Orem, UT 84058

Bankruptcy Case No.: 08-26555

Type of Business: Real Estate Developer

Chapter 11 Petition Date: September 29, 2008

Court: District of Utah (Salt Lake City)

Debtor's Counsel: Heather A. McDougald, Esq.
                  2856 Willow Way
                  Lehi, UT 84043
                  Tel: (801) 403-9575

Estimated Assets: $1 million to $10 million

Estimated Debts: $1 million to $10 million

Twin Hollow said it has no unsecured creditors.
           

UAL CORP: Executes Agreements to Improve Liquidity by $275 Million
------------------------------------------------------------------
UAL Corporation disclosed in a Securities and Exchange Commission
filing certain financing transactions that will give it around
$275 million of cash before the year ends.

The company has completed a $125 million aircraft financing
agreement, receiving approximately $60 million and will receive
the remaining approximately $65 million by mid October.

United has also executed agreements and agreements in principle
-- subject to reaching final documentation and other conditions --
to sell certain assets for approximately $140 million.  The
company received approximately $30 million from these assets in
the third quarter and expects to receive approximately $110
million in the fourth quarter.  In addition, United intends to
substitute certain cash collateral with a letter of credit,
generating $10 million in net incremental cash in the fourth
quarter.

"We are further strengthening our cash position, and we are
pleased to close this transaction, particularly in this market
environment," said Kathryn Mikells, who will become chief
financial officer on November 1.  "We still have over $3 billion
of unencumbered assets to further enhance our liquidity."

                      About UAL Corporation

Based in Chicago, Illinois, UAL Corporation (NASDAQ: UAUA)
-- http://www.united.com/-- is the holding company for United
Airlines, Inc.  United Airlines is the world's second largest
air carrier.  The airline flies to Brazil, Korea and Germany.

The company filed for chapter 11 protection on Dec. 9, 2002
(Bankr. N.D. Ill. Case No. 02-48191).  James H.M. Sprayregen,
Esq., Marc Kieselstein, Esq., David R. Seligman, Esq., and
Steven R. Kotarba, Esq., at Kirkland & Ellis, represented the
Debtors in their restructuring efforts.  Fruman Jacobson, Esq.,
at Sonnenschein Nath & Rosenthal LLP represented the Official
Committee of Unsecured Creditors before the Committee was
dissolved when the Debtors emerged from bankruptcy.

Judge Eugene R. Wedoff confirmed the Debtors' Second Amended
Plan on Jan. 20, 2006.  The company emerged from bankruptcy
protection on Feb. 1, 2006.

(United Airlines Bankruptcy News, Issue No. 164, Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or    
215/945-7000)

                         *     *     *

As reported in the Troubled Company Reporter on July 29, 2008,
Standard & Poor's Ratings Services lowered its ratings on UAL
Corp. and subsidiary United Air Lines Inc. (both rated B-
/Negative/--), including lowering the long-term corporate credit
ratings on both entities to 'B-' from 'B', and removed the ratings
from CreditWatch, where they had been placed with negative
implications May 22, 2008, as part of an industrywide review.  The
outlook is negative.
                                   

UNITED THERAPY: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: United Therapy Network, Inc.
        1230 E. Washington Street, Suite PA-2
        Colton, CA 92324

Bankruptcy Case No.: 08-23162

Type of Business: The Debtor offers rehabilitation services, and
                  specializes in physical, occupational, hand
                  therapy and speech-language pathology.
                  See: http://www.utninc.com/

Chapter 11 Petition Date: September 29, 2008

Court: Central District Of California (Riverside)

Debtor's Counsel: Robert B. Rosenstein, Esq.
                  robert@rosenhitz.com
                  Rosenstein & Hitzeman
                  28600 Mercedes St., Suite 100
                  Temecula, CA 92590
                  Tel: (951) 296-3888
                  Fax: (951) 296-3889

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/califcb08-23162.pdf


                       


VIOQUEST PHARMA: June 30 Balance Sheet Upside-Down by $5,670,850
----------------------------------------------------------------
VioQuest Pharmaceuticals Inc.'s consolidated balance sheet at
June 30, 2008, showed $1,177,335 in total assets, $2,693,527 in
total liabilities, and $4,154,658 in total mandatorily redeemable
convertible preferred stock, resulting in a $5,670,850
stockholders' deficit.

At June 30, 2008, the company's consolidated balance sheet also
showed strained liquidity with $1,131,964 in total current assets
available to pay $2,693,527 in total current liabilities.

The company reported a net loss of $1,839,436 for the second
quarter ended June 30, 2008, compared with a net loss of
$2,472,274 in the corresponding period last year.

The company has had no revenues from its continuing operations
through June 30, 2008.

Loss from continuing operations for the three months ended
June 30, 2008, was $1,130,664 as compared to $2,136,852 for the
three months ended June 30, 2007.  The decreased loss from
continuing operations in 2008 was attributable primarily to
planned reductions in R&D and G&A spending.

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?3319

                       Going Concern Doubt

Since inception, the company has incurred an accumulated deficit
of $44,352,714 through June 30, 2008.  As of June 30, 2008, the
company had a working capital deficit of $1,561,563 and cash and
cash equivalents of $814,477.  As a result, the company has
insufficient funds to cover its current obligations or future
operating expenses.  The company expects its operating losses to
increase over the next several years, due to the expansion of its
drug development business, and related costs associated with the
clinical development programs of Lenocta, VQD-002 and Xyfid, in
addition to costs related to license fees, manufacturing of its  
products, regulatory costs, and the hiring of additional people in
the clinical development area, pending available resources.

These matters raise substantial doubt about the company's ability
to continue as a going concern.

                  About VioQuest Pharmaceuticals

Headquartered in Basking Ridge, N.J., VioQuest Pharmaceuticals
Inc. (OTC BB: VOQP) -- http://www.vioquestpharm.com/-- is a  
biotechnology company dedicated to becoming a recognized leader in
the successful development of novel drug therapies targeting both
the molecular basis of cancer and side effects of treatment.
VioQuest's oncology portfolio includes: Xyfid(TM) (1% uracil
topical) for the prevention of hand-foot syndrome; VQD-002
(triciribine phosphate monohydrate), a targeted inhibitor of Akt
activation; and Lenocta(TM) (sodium stibogluconate), an inhibitor
of certain protein tyrosine phosphatases such as SHP-1, SHP-2, and
PTP1B.


WACHOVIA CORP: Moody's Cut Preferred Stock Rating to Ba3 from A3
----------------------------------------------------------------
Moody's placed Wachovia Corporation's senior and subordinated debt
ratings (senior at A1) and the deposit and debt ratings of
Wachovia banks and thrifts (deposits at Aa2) under review
direction uncertain.  Moody's lowered Wachovia's preferred stock
rating to Ba3 from A3 and placed it under review with direction
uncertain. Moody's also placed the B financial strength rating of
Wachovia's bank and thrifts on review for possible downgrade. The
Prime-1 rating on the bank, and the Prime-1 commercial paper
rating on Wachovia Corporation were affirmed.

Moody's rating action follows the announcement that Citigroup will
acquire the bank and thrift assets of Wachovia Corporation for
$2.1 billion. Citigroup also announced that it will assume the
senior and subordinated debt, including the junior subordinated
debt of Wachovia Corporation and preferred stock of Wachovia
Preferred Funding Corp. Citigroup will not acquire Wachovia's
retail brokerage operations, Wachovia Securities, or Wachovia's
asset management operations, Evergreen. These operations will
remain with Wachovia Corporation.

In response to this transaction Moody's placed the ratings of
Citigroup Inc. and Citibank under review for possible downgrade.
Moody's said that Wachovia Corporation's deposit, senior and
subordinated debt, will be dependent on the outcome of its review
of Citigroup, Inc.'s ratings.

Citigroup's ratings on review for possible downgrade include
Citibank N.A.'s B financial strength rating and Aa1 deposit and
other senior obligations ratings. Also under review for possible
downgrade are Citigroup, Inc.'s Aa3 senior debt rating, A1
subordinated debt rating, and A2 preferred securities rating.

Because Wachovia's bank and holding company ratings are lower than
Citigroup's, Moody's placed Wachovia's senior and subordinated
debt ratings on review with direction uncertain. That is, if
Citigroup's ratings are confirmed, Wachovia's ratings could be
raised. If Citigroup's ratings are lowered, then Wachovia's
ratings could be confirmed or lowered depending on the level of
downgrades for Citigroup, said Moody's.

Wachovia Bank's B financial strength rating, which is at the same
level as Citibank's financial strength rating, is under review for
possible downgrade.

The severe downgrade of Wachovia Corporation's preferred stock to
Ba3 from A3 reflects the expected substantial increase in leverage
at the holding company, whose major assets will be the operations
of the retail brokerage Wachovia Securities and Evergreen Asset
Management. The review with direction uncertain reflects the
uncertainty regarding the future financial profile of Wachovia
Corporation. Key considerations that will determine the future
rating direction for the preferred stock include the strategic and
financial plans for the newly constituted holding company, its
capital structure, and the operating earnings of this entity given
its new business mix.

Rating actions are:

Downgrades:

   Issuer: First Fidelity Bancorporation

      Preferred Stock Preferred Stock, Downgraded to Ba3 from A3

   Issuer: Wachovia Corporation

      Multiple Seniority Shelf, Downgraded to (P)Ba3 from (P)A3

      Preferred Stock Preferred Stock, Downgraded to Ba3 from A3

      Preferred Stock Shelf, Downgraded to (P)Ba3 from (P)A3

On Review for Possible Downgrade:

   Issuer: Wachovia Bank, N.A.

      Bank Financial Strength Rating, Placed on Review for
Possible Downgrade, currently B

   Issuer: World Savings Bank, FSB

      Bank Financial Strength Rating, Placed on Review for
Possible Downgrade, currently B

On Review Direction Uncertain:

   Issuer: Central Fidelity Capital Trust I

      Preferred Stock Preferred Stock, Placed on Review Direction
Uncertain, currently A2

   Issuer: Congress Financial Capital Company

      Senior Unsecured Regular Bond/Debenture, Placed on Review
Direction Uncertain, currently A1

   Issuer: CoreStates Capital I

      Preferred Stock Preferred Stock, Placed on Review Direction
Uncertain, currently A2

   Issuer: CoreStates Capital II

      Preferred Stock Preferred Stock, Placed on Review Direction
Uncertain, currently A2

   Issuer: CoreStates Capital III

      Preferred Stock Preferred Stock, Placed on Review Direction
Uncertain, currently A2

   Issuer: First Union Capital I

      Preferred Stock Preferred Stock, Placed on Review Direction
Uncertain, currently A2

      Preferred Stock Shelf, Placed on Review Direction Uncertain,
currently (P)A1

   Issuer: First Union Capital II

      Preferred Stock Preferred Stock, Placed on Review Direction
Uncertain, currently A2

   Issuer: First Union Capital III

      Preferred Stock Shelf, Placed on Review Direction Uncertain,
currently (P)A2

   Issuer: First Union Institutional Capital I

      Preferred Stock Preferred Stock, Placed on Review Direction
Uncertain, currently A2

   Issuer: First Union National Bank of Florida

      Subordinate Regular Bond/Debenture, Placed on Review
Direction Uncertain, currently Aa3

   Issuer: Golden West Financial Corporation

      Issuer Rating, Placed on Review Direction Uncertain,
currently A1

      Senior Unsecured Regular Bond/Debenture, Placed on Review
Direction Uncertain, currently A1

   Issuer: Meridian Bancorp, Inc.

      Multiple Seniority Shelf, Placed on Review Direction
Uncertain, currently (P)A3

   Issuer: South Carolina National Corporation

      Subordinate Medium-Term Note Program, Placed on Review
Direction Uncertain, currently A2

   Issuer: SouthTrust Bank

      Subordinate Regular Bond/Debenture, Placed on Review
Direction Uncertain, currently Aa3

   Issuer: SouthTrust Bank of Georgia, N.A. (Old)

      Subordinate Regular Bond/Debenture, Placed on Review
Direction Uncertain, currently A2

   Issuer: SouthTrust Corporation

      Subordinate Regular Bond/Debenture, Placed on Review
Direction Uncertain, currently A2

   Issuer: Wachovia Bank, N.A.

      Issuer Rating, Placed on Review Direction Uncertain,
currently Aa2

      OSO Senior Unsecured OSO Rating, Placed on Review Direction
Uncertain, currently Aa2

      Multiple Seniority Bank Note Program, Placed on Review
Direction Uncertain, currently Aa3

      Multiple Seniority Medium-Term Note Program, Placed on
Review Direction Uncertain, currently Aa3

      Subordinate Bank Note Program, Placed on Review Direction
Uncertain, currently Aa3

      Subordinate Conv./Exch. Bond/Debenture, Placed on Review
Direction Uncertain, currently Aa3

      Subordinate Regular Bond/Debenture, Placed on Review
Direction Uncertain, currently Aa3

      Senior Unsecured Bank Note Program, Placed on Review
Direction Uncertain, currently Aa2

      Senior Unsecured Deposit Note/Takedown, Placed on Review
Direction Uncertain, currently Aa2

      Senior Unsecured Conv./Exch. Bond/Debenture, Placed on
Review Direction Uncertain, currently Aa2

      Senior Unsecured Regular Bond/Debenture, Placed on Review
Direction Uncertain, currently Aa2

      Senior Unsecured Deposit Rating, Placed on Review Direction
Uncertain, currently Aa2

   Issuer: Wachovia Bank, N.A. (Old)

      Senior Unsecured Bank Note Program, Placed on Review
Direction Uncertain, currently Aa3

      Senior Unsecured Medium-Term Note Program, Placed on Review
Direction Uncertain, currently Aa3

      Senior Unsecured Regular Bond/Debenture, Placed on Review
Direction Uncertain, currently Aa3

   Issuer: Wachovia Capital Trust I

      Preferred Stock Preferred Stock, Placed on Review Direction
Uncertain, currently A2

   Issuer: Wachovia Capital Trust II

      Preferred Stock Preferred Stock, Placed on Review Direction
Uncertain, currently A2

   Issuer: Wachovia Capital Trust III

      Preferred Stock Preferred Stock, Placed on Review Direction
Uncertain, currently A3

      Preferred Stock Shelf, Placed on Review Direction Uncertain,
currently (P)A2

   Issuer: Wachovia Capital Trust IV

      Preferred Stock Preferred Stock, Placed on Review Direction
Uncertain, currently A2

   Issuer: Wachovia Capital Trust IX

      Preferred Stock Preferred Stock, Placed on Review Direction
Uncertain, currently A2

      Preferred Stock Shelf, Placed on Review Direction Uncertain,
currently (P)A3

   Issuer: Wachovia Capital Trust V

      Preferred Stock Preferred Stock, Placed on Review Direction
Uncertain, currently A2

   Issuer: Wachovia Capital Trust VII

      Preferred Stock Shelf, Placed on Review Direction Uncertain,
currently (P)A2

   Issuer: Wachovia Capital Trust VIII

      Preferred Stock Shelf, Placed on Review Direction Uncertain,
currently (P)A2

   Issuer: Wachovia Capital Trust X

      Preferred Stock Preferred Stock, Placed on Review Direction
Uncertain, currently A2

      Preferred Stock Shelf, Placed on Review Direction Uncertain,
currently (P)A3

   Issuer: Wachovia Capital Trust XI

      Preferred Stock Shelf, Placed on Review Direction Uncertain,
currently (P)A3

   Issuer: Wachovia Capital Trust XII

      Preferred Stock Shelf, Placed on Review Direction Uncertain,
currently (P)A3

   Issuer: Wachovia Capital Trust XIII

      Preferred Stock Shelf, Placed on Review Direction Uncertain,
currently (P)A3

   Issuer: Wachovia Capital Trust XIV

      Preferred Stock Shelf, Placed on Review Direction Uncertain,
currently (P)A2

   Issuer: Wachovia Capital Trust XV

      Preferred Stock Shelf, Placed on Review Direction Uncertain,
currently (P)A3

   Issuer: Wachovia Corporation

      Junior Subordinated Shelf, Placed on Review Direction
Uncertain, currently (P)A2

      Multiple Seniority Medium-Term Note Program, Placed on
Review Direction Uncertain, currently A2

      Multiple Seniority Shelf, Placed on Review Direction
Uncertain, currently (P)A2

      Subordinate Medium-Term Note Program, Placed on Review
Direction Uncertain, currently A2

      Subordinate Regular Bond/Debenture, Placed on Review
Direction Uncertain, currently A2

      Senior Unsecured Conv./Exch. Bond/Debenture, Placed on
Review Direction Uncertain, currently A1

      Senior Unsecured Medium-Term Note Program, Placed on Review
Direction Uncertain, currently A1

      Senior Unsecured Regular Bond/Debenture, Placed on Review
Direction Uncertain, currently A1

   Issuer: Wachovia Corporation (Old)

      Multiple Seniority Shelf, Placed on Review Direction
Uncertain, currently (P)A2

      Subordinate Regular Bond/Debenture, Placed on Review
Direction Uncertain, currently A2

      Senior Subordinated Regular Bond/Debenture, Placed on Review
Direction Uncertain, currently A2

      Senior Unsecured Regular Bond/Debenture, Placed on Review
Direction Uncertain, currently A1

   Issuer: Western Financial Bank, F.S.B.

      Subordinate Regular Bond/Debenture, Placed on Review
Direction Uncertain, currently Aa3

   Issuer: Wachovia Preferred Funding Corp.

      Preferred Stock Preferred Stock, Placed on Review Direction
Uncertain, currently A3

   Issuer: World Savings Bank, FSB

      Issuer Rating, Placed on Review Direction Uncertain,
currently Aa2

      OSO Senior Unsecured OSO Rating, Placed on Review Direction
Uncertain, currently Aa2

      Senior Unsecured Regular Bond/Debenture, Placed on Review
Direction Uncertain, currently Aa2

      Senior Unsecured Deposit Rating, Placed on Review Direction
Uncertain, currently Aa2

Outlook Actions:

   Issuer: Central Fidelity Capital Trust I

      Outlook, Changed To Rating Under Review From Negative

   Issuer: Congress Financial Capital Company

      Outlook, Changed To Rating Under Review From Negative

   Issuer: CoreStates Capital I

      Outlook, Changed To Rating Under Review From Negative

   Issuer: CoreStates Capital II

      Outlook, Changed To Rating Under Review From Negative

   Issuer: CoreStates Capital III

      Outlook, Changed To Rating Under Review From Negative

   Issuer: First Fidelity Bancorporation

      Outlook, Changed To Rating Under Review From Negative

   Issuer: First Union Capital I

      Outlook, Changed To Rating Under Review From Negative

   Issuer: First Union Capital II

      Outlook, Changed To Rating Under Review From Negative

   Issuer: First Union Capital III

      Outlook, Changed To Rating Under Review From Negative

   Issuer: First Union Institutional Capital I

      Outlook, Changed To Rating Under Review From Negative

   Issuer: First Union National Bank of Florida

      Outlook, Changed To Rating Under Review From Negative

   Issuer: Golden West Financial Corporation

      Outlook, Changed To Rating Under Review From Negative

   Issuer: Meridian Bancorp, Inc.

      Outlook, Changed To Rating Under Review From Negative

   Issuer: South Carolina National Corporation

      Outlook, Changed To Rating Under Review From Negative

   Issuer: SouthTrust Bank

      Outlook, Changed To Rating Under Review From Negative

   Issuer: SouthTrust Bank of Georgia, N.A. (Old)

      Outlook, Changed To Rating Under Review From Negative

   Issuer: SouthTrust Corporation

      Outlook, Changed To Rating Under Review From Negative

   Issuer: Wachovia Bank, N.A.

      Outlook, Changed To Rating Under Review From Negative

   Issuer: Wachovia Bank, N.A. (Old)

      Outlook, Changed To Rating Under Review From Negative

   Issuer: Wachovia Capital Trust I

      Outlook, Changed To Rating Under Review From Negative

   Issuer: Wachovia Capital Trust II

      Outlook, Changed To Rating Under Review From Negative

   Issuer: Wachovia Capital Trust III

      Outlook, Changed To Rating Under Review From Negative

   Issuer: Wachovia Capital Trust IV

      Outlook, Changed To Rating Under Review From Negative

   Issuer: Wachovia Capital Trust IX

      Outlook, Changed To Rating Under Review From Negative

   Issuer: Wachovia Capital Trust V

      Outlook, Changed To Rating Under Review From Negative

   Issuer: Wachovia Capital Trust VII

      Outlook, Changed To Rating Under Review From Negative

   Issuer: Wachovia Capital Trust VIII

      Outlook, Changed To Rating Under Review From Negative

   Issuer: Wachovia Capital Trust X

      Outlook, Changed To Rating Under Review From Negative

   Issuer: Wachovia Corporation

      Outlook, Changed To Rating Under Review From Negative

   Issuer: Wachovia Corporation (Old)

      Outlook, Changed To Rating Under Review From Negative

   Issuer: Wachovia Preferred Funding Corp.

      Outlook, Changed To Rating Under Review From Negative

   Issuer: Western Financial Bank, F.S.B.

      Outlook, Changed To Rating Under Review From Negative

   Issuer: World Savings Bank, FSB

      Outlook, Changed To Rating Under Review From Negative

Wachovia Corporation is headquartered in Charlotte, N.C. Its
reported assets as of June 30, 2008 were $812 billion.


WASHINGTON MUTUAL: Court Sets Status Conference Tomorrow
--------------------------------------------------------
The United States Bankruptcy Court for the District of Delaware
entered an order this afternoon directing that a Status Conference
of the Chapter 11 cases of Washington Mutual Inc. and its debtor-
affiliates, will be held before the Court on October 3, 2008, at
9:30 a.m.

Based in Seattle, Washington, Washington Mutual Inc. --
http://www.wamu.com/-- is a holding company for Washington Mutual   
Bank as well as numerous non-bank subsidiaries.  The company
operates in four segments: the Retail Banking Group, which
operates a retail bank network of 2,257 stores in California,
Florida, Texas, New York, Washington, Illinois, Oregon, New
Jersey, Georgia, Arizona, Colorado, Nevada, Utah, Idaho and
Connecticut; the Card Services Group, which operates a nationwide
credit card lending business; the Commercial Group, which conducts
a multi-family and commercial real estate lending business in
selected markets, and the Home Loans Group, which engages in
nationwide single-family residential real estate lending,
servicing and capital markets activities.

Washington Mutual Bank was taken over Sept. 25 by U.S. government
regulators.  The next day, WaMu and its debtor-affiliate, WMI
Investment Corp., filed separate petitions for Chapter 11 relief
(Bankr. D. Del. 08-12229 and 08-12228, respectively).  Wamu owns
100% of the equity in WMI Investment.  Weil Gotshal & Manges
represents the Debtors as counsel. When WaMu filed for protection
from its creditors, it listed assets of $32,896,605,516 and debts
of $8,167,022,695.  WMI Investment listed assets of $500,000,000
to $1,000,000,000 with zero debts.

Bloomberg notes that WaMu's debt ranks it among the largest U.S.
bankruptcies by indebtedness.  Lehman Brothers Holdings'
bankruptcy filing on Sept. 15 is the largest, with $613 billion in
debt.  WorldCom Inc., the telecommunications firm that filed for
protection in 2002 after accounting malfeasance was disclosed,
listed $41 billion in debt in what's now the second-largest
Chapter 11 case, according to Bloomberg.


WASTE SERVICES: Commences Consent Solicitation for 9-1/2% Notes
---------------------------------------------------------------
Waste Services Inc. commenced a consent solicitation relating to
its 9-1/2% Senior Subordinated Notes due 2014 (CUSIP Number:
94107UAB4).  The consent solicitation will expire at 5:00 p.m.,
New York City time, on Oct. 6, 2008, unless extended by the
company.  The consent solicitation is being made pursuant to,
and upon the terms and subject to the conditions set forth in, the
Consent Solicitation Statement dated Sept. 26, 2008.

The consent solicitation is being conducted in connection with a
proposed refinancing of the company's existing senior secured
credit facilities.  Consummation of the consent solicitation is
subject to the satisfaction or waiver of certain conditions
described in the Consent Solicitation Statement, including the
successful refinancing of the company's existing senior secured
credit facilities and receipt of valid and not validly revoked
consents from holders of at least a majority of the aggregate
principal amount of outstanding Notes.

Promptly after the Expiration Time, subject to receipt of valid
and not validly revoked consents from holders of at least a
majority of the aggregate principal amount of outstanding Notes,
the company will execute a supplemental indenture.  However, the
terms of the supplemental indenture will not become operative
unless and until the successful refinancing of the company's
existing senior secured credit facilities is completed or the
condition that it be completed is waived by the company.

Holders of Notes may withdraw their consent at any time prior to
the Expiration Date.  Holders of approximately 70% of the
aggregate principal amount of the outstanding Notes have
indicated that they will deliver, and not revoke, their consent
to the consent solicitation.

Holders who deliver, and do not revoke their consent on or prior
to the Expiration Time, will receive a consent payment of 0.75%
of the outstanding principal amount of the Notes for which the
holder provided consent.

The company has retained Barclays Capital Inc. as the Solicitation
Agent for the consent solicitation.  D.F. King & Co. Inc., is the
Tabulation and Information Agent for the consent solicitation.
Questions regarding the consent solicitation may be directed to
the Liability Management Group at Barclays Capital Inc. at 800-
438-3242 (toll-free) or 212-528-7581 (collect). Requests for
copies of the Consent Solicitation documents may be directed to
D.F. King & Co., Inc. at (800) 431-9645 (toll-free) or 212-269-
5550 (collect).

                    About Waste Service

Headquartered in Burlington, Ontario, Waste Services Inc. (NASDAQ:
WSII) -- http://www.wasteservicesinc.com/-- is a multi-regional,
integrated solid waste services company, providing collection,
transfer, landfill disposal and recycling services for commercial,
industrial and residential customers in the United States and
Canada.

                          *     *     *

Moody's Investors Service placed Waste Services Inc.'s
subordinated debt rating at 'Caa1' in September 2006.  The rating
still holds to date with a positive outlook.


WEXTRUST CAPITAL: District Court Appoints Temporary Receiver
------------------------------------------------------------
The U.S. District Court for the Southern District of New York on
Sept. 11, 2008, granted the request of the Plaintiff U.S.
Securities and Exchange Commission to appoint Timothy J. Coleman,
Esq., at Dewey & LeBoeuf, LLP, as receiver for defendants Wextrust
Capital, LLC, Wextrust Development Group, LLC, Wextrust
Securities, LLC, and Axela Hospitality, Inc., and all entities
they control or in which they have an ownership interest pending
adjudication of the Commission's request for a preliminary
injunction.

Chicago, Illinois-based WexTrust Capital, LLC,--
http://www.wextrustreceiver.com/-- is a globally diversified  
private equity and specialty finance company.  It specializes in
investment opportunities ranging from real estate to specialty
finance and investment banking.


WHITE RIVER: Creditors Ask Court to Dismiss Chapter 11 Case
-----------------------------------------------------------
Blankenberger Brothers, Inc., and B.B. Mining, Inc., and the
holders of allowed administrative expense claims for unpaid coal
royalties ask the U.S. Bankruptcy Court for the Southern District
of Indiana to dismiss White River Coal, Inc., and its debtor-
affiliates' Chapter 11 cases or convert the cases to Chapter 7.

Blankenberger Brothers, et al., claim that the Debtors have lost
their identity as debtors in possession.  Lacking duly appointed
officers, directors, or managers, the Debtors have a "leadership
vacuum" that their secured lender, Standard Bank PLC, appears to
have progressively filled.  The Debtors' officers, directors, and
managers abdicated the Debtors' authority to act as debtors in
possession shortly after they filed for Chapter 11 protection.  
Since then, the Debtors have lacked duly appointed officers,
directors, or managers, and no chapter 11 trustee has ever been
appointed.

The Creditors tell the Court that the Debtors and Standard Bank
purport to be parties to a common interest privilege agreement in
connection with claims arising from the 2005 leveraged buyout
transaction in which Standard Bank originally acquired its
security interests in the Debtors' assets.  Standard Bank,
according to the Creditors, has essentially become the Debtors'
"alter ego," and the Debtors' professionals apparently take their
marching orders directly from the bank.  According to the
Creditors, Standard Bank dictates what administrative expense
claims the Debtors should pay.  Standard Bank has conditioned its
consent to the use of its cash collateral upon the Debtors'
pursuit of litigation "for the primary benefit" of Standard Bank.
                                                                                              
The Creditors claim that the Debtors fail to rehabilitate its
affairs through a plan that can satisfy administrative expenses.

When they filed for Chapter 11 protection, the Debtors sought the
Court's permission to employ Realization Advisors, Inc., as their
Chief Restructuring Officer.  At that time, Daniel Hodges was the
sole director or sole member of each of the Debtors.  The Debtors
sought to employ RAI as a "crisis manager" and "bankruptcy
consultant" to assist and advise the Debtors and their management
with respect to their bankruptcy cases.

Hazleton, Indiana-based White River Coal, Inc., and its affiliates
are mining companies.  They filed for Chapter 11 protection on May
22, 2006 (Bankr. S.D.Ind. Case No. 06-70375).  C.R. Bowles, Jr.,
Esq., at Greenbaum Doll & McDonald PLLC, represents the company in
their restructuring efforts.  The Debtors listed assets of
$2,000,000 and liabilities of $35,000,000 when they filed for
bankruptcy.


WILD WEST: Founder to Testify in Dispute With Village Charters
--------------------------------------------------------------
Bill Wilson at The Wichita (Kansas) Eagle reports that Wild West
World LLC's founder, Thomas Etheredge, will testify in a "bench
trial" in the U.S. Bankruptcy Court for the District of Kansas, as
the firm tries to recover some $100,000 from Village Charters.

As reported in the Troubled Company Reporter on March 18, 2008,
Wild West's counsel, Tom Gilman, asserted that Mr. Etheredge paid
on April 9 and April 23, 2007, about  $100,000 as an initial
payment to a personal loan from Village Charters.  Mr. Gilman
claimed that the payment was made within a 90-day window
prior to Wild West's bankruptcy on July 9, 2007, and therefore it
should be reclaimed for creditor distribution.  Village Charter's
counsel, Jeff Arensdorf, Esq., contested that
the reclamation of the payments is not required under bankruptcy
laws.  If talks between parties fail, the Hon. Robert Nugent of
the Court would hear the issue.

The Wichita Eagle relates that Judge Nugent issued a "pre-trial
order" on the West World-Village Charters dispute on Friday.  The
pre-trial order contained details about the Village Charters loan
that haven't been disclosed, the report says.

According to The Wichita Eagle, Village Charters' owners, Norman
and Jeff Arensdorf, will claim that Mr. Etheredge told them that
Wild West was solvent when he filed for the loan and that Mr.
Etheredge said that "he needed the funds as a bridge loan until he
received his (Small Business Administration) loan."

State securities officials are investigating Wild West's solvency
and how it was disclosed by Mr. Etheredge to those personal
investors, The Wichita Eagle reports.

                      About Wild West World

Headquartered in Valley Center, Kansas, Wild West World LLC
operates an amusement park business.  The company filed for
Chapter 11 protection on July 9, 2007 (Bankr. D. Kans. Case No.
07-11620).  Restoration Farms Inc., Wild West's parent company,
filed for chapter 11 protection on Aug. 9, 2007 (Bankr. D. Kans.
Case No. 07-11913).  Tom Gilman, Esq., at Redmond & Nazar LLP
represents the Debtor in its restructuring efforts.  In its
schedules filed with the Court, the Debtor disclosed total assets
of $22,979,898 and total debts of $25,601,177.


WINDY CITY: Asks Court to Dismiss Chapter 11 Case
-------------------------------------------------
Windy City Group, LLC, has asked the U.S. Bankruptcy Court for the
District of Arizona to dismiss its Chapter 11 Bankruptcy case.  
The Debtor tells the Court that it no longer needs bankruptcy
protection and is not in default with respect to any creditor with
whom it has not reached an agreement and compromise.

Scottsdale, Arizona-based Windy City Group LLC filed for Chapter
11 protection on June 18, 2008 (Bankr. D. Ariz. Case No. 08-
07274).  Tim Coker, Esq., at the Coker Law Office, represents the
Debtor in its restructuring efforts.  When the Debtor filed for
protection from its creditors, it listed assets of $10 million to
$50 million, and debts of $10 million to $50 million.


WISER EXCAVATING: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Wiser Excavating, Inc.
        1726 Wooded Hills Lane
        Jefferson City, MO 65109

Bankruptcy Case No.: 08-21789

Chapter 11 Petition Date: September 29, 2008

Court: Western District of Missouri (Jefferson City)

Debtor's Counsel: Harry D. Boul, Esq.
                  hboul@earthlink.net
                  One East Broadway Street, Suite B
                  Columbia, MO 65203
                  Tel: (573) 443-7000
                  Fax: (573) 449-6554

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

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

Wiser Excavating, Inc.'s chapter 11 petition with a list of
largest unsecured creditors is available for free at:

               http://researcharchives.com/t/s?3324


WP EVENFLO: Moody's Lowers Corporate Family Rating to B3
--------------------------------------------------------
Moody's Investors Service lowered WP Evenflo's ("Evenflo")
corporate family and probability of default ratings to B3 from B2
and affirmed the B1 first lien term loan (LGD3, 32.6%, revised
from 36%) and the Caa1 second lien term loan (LGD5, 76.6%, revised
from 83%). The rating outlook is stable. The downgrade reflects
Evenflo's slower growth and higher costs than had been anticipated
when the rating was affirmed following the company's proposed
acquisition of Ameda Breastfeeding Products in November 2007.
Notably, a product recall and an exceptionally large increase in
costs from suppliers during the first half of 2008 negatively
impacted Evenflo's financial performance. Moody's is concerned
that subsequent price increases will not sufficiently offset these
events. Additional rating pressure is driven by the very modest
cushion the company has under its bank covenants and concerns
regarding the company's ability to meet the step downs in 2009.
Mitigating Moody's concerns regarding operating performance and
covenant compliance is Moody's belief that brand equity and,
consequently, enterprise value reflect adequate asset coverage of
Evenflo's secured bank debt. Moreover, performance in 2009 should
reflect improvements in revenue and EBITDA as new products are
introduced and prices are adjusted.

Moody's has taken the following rating actions:

Corporate family rating downgraded to B3

Probability of default rating downgraded to B3

$40 million senior secured revolving credit facility affirmed at
B1 (LGD3, 32.6%)

$120 million first lien term loan affirmed at B1 (LGD3, 32.6%)

$45 million second lien term loan affirmed at Caa1 (LGD5, 76.6%)

The rating outlook is stable.

Headquartered in Miamisburg, Ohio, WP Evenflo is a leading
provider of infant and juvenile products to key retailers such as
Toys "R" Us, Wal-Mart, Target, and K-Mart. The company provides
car seats (convertible, booster, and infant), on-the-go products
(strollers, travel systems, and portable playards), feeding
products (breast pumps, feeding systems, bottles, high chairs, and
pacifiers), and playtime products (carriers, stationary activity
centers, and safety gates). Revenues were $350 million for the 12
months ended June 30, 2008.


YOUNG BROADCASTING: GAMCO Discloses 8.61% Equity Stake
------------------------------------------------------
Mario J. Gabelli and various entities which he directly or
indirectly controls or for which he acts as chief investment
officer, disclosed in a Schedule 13D filing with the U.S.
Securities and Exchange Commission that they may be deemed to
beneficially own 1,879,000 of common shares of Young Broadcasting
Inc., representing 8.61% of the 21,836,161 shares outstanding as
of June 30, 2008.  

Gabelli Funds, LLC beneficially owned 810,000 shares, representing
3.71% of the outstanding shares in the company.

GAMCO Asset Management Inc. beneficially owned 1,039,000 shares,
representing 4.76% of the outstanding shares in the company.

Teton Advisors, Inc. beneficially owned 30,000 shares,
representing 0.14% of the outstanding shares in the company.

                     About Young Broadcasting

Headquartered in New York City, Young Broadcasting Inc. --
http://www.youngbroadcasting.com/-- owns ten television stations      
and the national television representation firm, Adam Young Inc.  
Five stations are affiliated with the ABC Television Network,
three are affiliated with the CBS Television Network, one is
affiliated with the NBC Television Network, and one is affiliated
with MyNetwork.  In addition, KELO-TV-Sioux Falls, SD is also the
MyNetwork affiliate in that market through the use of its digital
channel capacity.
                          *     *     *

As reported in the Troubled Company Reporter on Sept. 9, 2008,
Standard & Poor's Ratings Services lowered its corporate credit
rating and issue-level ratings on New York City-based Young
Broadcasting Inc.  The corporate credit rating was lowered to
'CCC' from 'CCC+'.  The rating outlook is negative.  The company
had about $826 million of outstanding debt as of June 30, 2008.


* NewOak Capital Selects Senior Professionals to Advisory Practice
------------------------------------------------------------------
NewOak Capital appoints key leaders of its integrated
advisory/asset management/structured product firm. Launched to
provide expert client solutions to today's global market crisis,
NewOak Capital furnishes analysis, valuation, restructuring, risk
transfer and distressed asset management solutions and services to
financial institutions to support their portfolio and corporate
needs.

"With our new team of highly experienced and respected
structured finance credit professionals, NewOak Capital is
strategically positioned to help clients successfully overcome
the unprecedented challenges brought about by the current
global financial crisis.  NewOak's 18 specialized investment
professionals collectively have more than 150 years of experience
in structuring, valuation and credit risk analysis of securities
backed by residential/commercial real estate mortgages, consumer,
and corporate credits.  Also, our close partnership with EdgeMAC
informs us on the most relevant trends in borrower's behavior,
property values and practical risk mitigation strategies and
allow us to value pools of loans or securities closest to their
realistic expected cash flows," says Ron D'Vari, CEO.

The senior appointments include Managing Directors Jess Saypoff
Esq., formerly of Barclays Capital, as Chief Counsel, James
Dougherty, formerly of Deutsche Post Bank and JP Morgan Investment
Management; Ross Heller, formerly of JP Morgan Securities; Neil
McPherson, formerly of ABN Amro and Credit Suisse; Shanker
Merchant, formerly of Wachovia; and Precilla Torres, formerly of
Citigroup and Lehman Brothers.  The other recent appointments
include Arjun Kakar from NIBC; Peter Heintz from UBS, Alex Razumny
from Bear Stearns as Director and Max Marquardt from Citigroup;
Irina Shulmanovich from Fortis Securities as Associate Director,
respectively.

A complete list of team members and their brief background
information can be found on the "Our Team" section at
http://ResearchArchives.com/t/s?333b

"We believe that in addition to policy responses from the Federal
Government, current market conditions have created the need for an
independent, agile and integrated advisory platform. The NewOak
Capital platform takes a"reality-based" approach to the analysis
of the underlying credits in complex securities in that we believe
only the loan-level expected losses derived from extrapolating
relevant servicing trends provide reliable estimates in today's
environment.  The NewOak Capital team of experts is positioned to
act timely in this dynamic marketplace to implement solutions in a
confidential fashion," says James Frischling, President.

As Co-Founder and CEO, Ron D'Vari, the former Head of Structured
Finance at BlackRock, is responsible for advisory, solutions and
portfolio management.  Co-Founder and President James Frischling,
the former Head of US Structured Credit at Fortis Securities, is
responsible for capital markets, client management and business
affairs.   

                   About Edge Mortgage Advisory

EdgeMAC Mortgage is a mortgage advisory and solution platform
specializing in providing institutional clients with residential
mortgage loan and portfolio level solutions encompassing due
diligence, underwriting, refinancing and modification.

                       About NewOak Capital

NewOak Capital is an advisory, asset management, and capital
markets firm organized to serve institutions in response to
challenges arising from the global credit markets. It provides
analysis, valuation, restructuring, risk transfer, and management
solutions and services to financial institutions and investors to
support their portfolio and corporate needs.  NewOak Capital
employs 18 senior professionals with an average of 17 years of
experience in the fixed-income markets in addition to 8 junior and
support staff. It specializes in residential and commercial
mortgage loans and securities, REITs, asset-backed securities,
structured corporate securities (CSOs/CLOs), and distressed
financial companies with exposure.  NewOak employs a
differentiated framework, an integrated"see-through" analytics
platform, and a team of experienced professionals with diversified
investment and modeling expertise to provide client solutions.


* Phillip Kleweno Joints Bain Corporate Renewal Group
-----------------------------------------------------
Phillip Kleweno, an expert in corporate restructuring who led the
repositioning of both Teleflora LLC and Princess Cruises, has
returned to Bain & Company and been named Partner of the Bain
Corporate Renewal Group (Bain CRG).

"[Mr. Kleweno demonstrated superior leadership and adaptability in
his leadership roles at Teleflora and Princess," said Sam Rovit,
Partner and Leader of Bain CRG.  "Through complex assignments,
he has honed the skill set our Bain CRG teams employ to help
management teams in stressed and distressed situations.  As the
newest addition to our national restructuring team, he will
provide clients with the support and counsel they need to preserve
equity as the market turmoil continues."

Bain CRG combines Bain & Company's heritage of turnaround work,
deep industry, operations and strategic expertise with
professional restructuring experts and executives like Phil who
have led major companies through challenging times.

Bain CRG specializes in integrated, rapid turnaround and financial
restructuring services.  Interim company leadership is also a key
element of the Bain CRG portfolio and Kleweno's experience in C-
suite assignments deepens the pool of C-level talent.

Mr. Kleweno joins Bain CRG after leading Teleflora– the premium
full-service, same-day floral provider that specializes in serving
local retail florists – and transitioning the company into the
internet and E-tailing era.  Prior to that, he steered Princess
Cruises, a $1.8 billion company with more than 14,000 employees,
through the cruise industry's most turbulent era in the wake of
9/11 and ultimately consummated a highly successful sale of the
business to Carnival.

Mr. Kleweno began his career with Honeywell Inc. and held a senior
management role at healthcare information company, The Zitter
Group, in addition to his prior service as a Bain Partner in the
firm's Los Angeles, San Francisco and Moscow offices.  

Mr. Kleweno holds an MBA from Harvard Business School, and
received his BS, magna cum laude, from Arizona State University.

                       About Bain & Company

Bain & Company -- http://www.bain.com/-- is a consulting firm.   
The firm serves clients on issues of strategy, operations,
technology, organization and mergers and acquisitions.  The firm
was founded in 1973 on the principle that Bain consultants must
measure their success by their clients' financial results.  The
firm's clients have outperformed the stock market 4 to 1.  With 39
offices in 26 countries, Bain has worked with over 3,900 major
multinational, private equity and other corporations across every
economic sector.


* Legal And Business Communities Honor Memory of Tina Brozman
-------------------------------------------------------------
"Tina's Wish," a new charitable organization that honors the
memory of Tina Brozman, former chief judge of the U.S. Bankruptcy
Court for the Southern District of New York and co-leader of
Bingham McCutchen LLP's financial restructuring group, will
host two inaugural fundraising dinners on both sides of the
Atlantic this month.  The events are expected to raise
approximately $600,000 in the fight against ovarian cancer, which
took Ms. Brozman's life in 2007.

The youngest bankruptcy judge appointed in the Second Circuit at
the age of 32 in 1985, Ms. Brozman issued more than 150 decisions,
many of which had a major impact on bankruptcies involving
multinational corporations.

She presided over the 1991 bankruptcy case of the British company
Maxwell Communications Corp., the former parent of the New York
Daily News.  The work involved significant cooperation with Lord
Leonard Hoffman, a law lord in England's House of Lords, and
helped define the standard for multinational bankruptcies.

The United Nations later adopted protocols first developed in the
Maxwell case for its model law on cross-border insolvencies.  That
work ultimately resulted in the adoption of the Chapter 15 to the
U.S. Bankruptcy Code in 2005, which was also based on Ms.
Brozman's role in the Maxwell insolvency.

The official transatlantic launch will be marked by two
significant fundraisers, a London event on Oct. 7 and another in
New York on Oct. 21.  The London dinner will feature Lord Hoffman,
receiving an award given jointly by Tina's Wish and INSOL
International.  Lord Hoffman will be recognized for his and Ms.
Brozman's contributions in the field of international bankruptcy.

In New York, Tina's Wish will honor Gil Mor, M.D., Ph.D., Yale
School of Medicine, for directing important research in the effort
to detect ovarian cancer at its early and most survivable stage.  
Additionally, to recognize Ms. Brozman's devotion to mentoring
young professionals, the first annual Tina Brozman Mentoring Award
will be presented to Judge Burton R. Lifland, whom Judge Brozman
followed as the chief judge of the U.S. Bankruptcy Court for the
Southern District of New York.

"I am delighted these events will serve not only to honor the
memory of my wife and generate much needed funding for ovarian
cancer research but also will bring together our community of
restructuring professionals to honor two individuals with whom she
worked so closely: Judge Burton Lifland and Lord Hoffman," said
Andrew Brozman, a partner in Clifford Chance's Finance &
Restructuring practice in New York and a member of the board
of Tina's Wish.

"Through the generosity of so many people who worked with, knew
and loved Tina, we are able to set the stage for launching a
robust fundraising effort," said Amy Kyle, who chairs the Tina's
Wish board and worked closely with Ms. Brozman at Bingham. "Even
in the face of this terrible disease, Tina wanted to create a
legacy of hope and benefit for other women facing ovarian cancer."

The money raised by Tina's Wish will fund a research fellowship
and an endowment at the Yale University Cancer Center, which has
produced promising work on the elusive early detection test for
ovarian cancer.  Of all the gynecological diseases, ovarian cancer
is the most deadly.  Approximately 75 to 80 percent of women are
diagnosed in later stages when the cancer has spread beyond the
ovaries and the chance of survival is poor.

On the Web: http://www.tinaswish.org.


* Matthew Niemann Rejoins Houlihan Lokey as a Managing Director
---------------------------------------------------------------
Houlihan Lokey disclosed that Matthew Niemann has rejoined the
firm as a managing director and co-head of Houlihan Lokey's
Midwest Restructuring Practice.  Mr. Niemann joins from Cerberus
Capital Chicago, an affiliate of Cerberus Capital Management,
where he was a managing director and focused on private equity and
lending investments.  He also worked withGMAC ResCap, a Cerberus
Capital portfolio company.  At Houlihan Lokey, Mr. Niemann will
focus on providing restructuring advice to companies and their
constituents.

"We hated to lose [Mr. Niemann] and we are delighted to have him
back," Jeff Werbalowsky, Co-CEO of Houlihan Lokey, said.  "The
extra experience and perspective he gained at Cerberus will be an
asset to our clients."

Mr. Niemann emphasized the value of his association with Cerberus.
He said, "I gained incredible insights that will benefit me as I
return to the advisory side of the business.  Cerberus is a world-
class organization and I have a great deal of respect for the firm
and its leadership. My decision to return to Houlihan Lokey was
driven by my desire to return to my roots as an advisor as the
distressed cycle unfolds over the next several years."

Prior to joining Cerberus, Mr. Niemann was a managing director
with Houlihan Lokey in their Chicago and Los Angeles offices.
Earlier in his career, Mr. Niemann was with the restructuring and
corporate finance group of PriceWaterhouseCoopers and practiced
law with Bryan Cave in St. Louis in their corporate, banking, real
estate and restructuring practices.  He has been involved in a
number of notable restructurings throughout his career, including
Sea Containers, Meridian Automotive, USG, Interstate Bakeries,
St. Vincent's Catholic Medical Centers, The National Benevolent
Association, Farmland Foods, Bugle Boy Industries, StairMaster,
Allied/Federated and Interco.  Mr. Niemann holds a finance and law
degree from St. Louis University, where he served on the Law
Review. Mr. Niemann is a Certified Turnaround Professional, a
member of the American Bankruptcy Institute and has been
recognized by the K&A Registry as one of the leading restructuring
investment bankers in the U.S.

                       About Houlihan Lokey

Houlihan Lokey -- http://www.HL.com/-- is an international  
investment bank that provides services, including mergers and
acquisitions, financing, financial opinions and advisory services,
and financial restructuring.  Established in 1970, the firm has
over 800 employees in 14 offices in the United States, Europe and
Asia.  Each year the company serves more than 1,000 clients
ranging from closely held companies to Global 500 corporations.


* Chapter 11 Cases with Assets & Liabilities Below $1,000,000
-------------------------------------------------------------
Recent Chapter 11 cases filed with assets and liabilities below
$1,000,000:

In Re Schirmer Enterprises, Inc.
   Bankr. W.D. Ark. Case No. 08-73768
      Chapter 11 Petition filed September 23, 2008
         See http://bankrupt.com/misc/akwb08-73768.pdf

In Re PJK, Inc.
   Bankr. D. Colo. Case No. 08-24755
      Chapter 11 Petition filed September 24, 2008
         See http://bankrupt.com/misc/cob08-24755.pdf

In Re National Images, Inc.
   Bankr. D. Md. Case No. 08-22262
      Chapter 11 Petition filed September 24, 2008
         See http://bankrupt.com/misc/mdb08-22262.pdf

In Re Lighthouse Real Estate Holdings, LLC
   Bankr. E.D. Mich. Case No. 08-63180
      Chapter 11 Petition filed September 24, 2008
         See http://bankrupt.com/misc/mieb08-63180.pdf

In Re Poppenga Concrete, Inc.
   Bankr. W.D. Mo. Case No. 08-61796
      Chapter 11 Petition filed September 24, 2008
         See http://bankrupt.com/misc/mowb08-61796.pdf

In Re Kenneth Halvorsen
   Bankr. C.D. Calif. Case No. 08-17306
      Chapter 11 Petition filed September 24, 2008
         Filed as Pro Se

In Re Jim Patrick Telford
      aka Jimi Telford
   Bankr. D. Nev. Case No. 08-21106
      Chapter 11 Petition filed September 24, 2008
         Filed as Pro Se

In Re Depina Super Laundromat Services, LLC
   Bankr. W.D. N.C. Case No. 08-32035
      Chapter 11 Petition filed September 24, 2008
         Filed as Pro Se

In Re Pamela Anyadike
   Bankr. C.D. Calif. Case No. 08-25720
      Chapter 11 Petition filed September 24, 2008
         Filed as Pro Se

In Re JABVM, LLC
      dba Brooklyn Boys Pizzeria
   Bankr. D. Ariz. Case No. 08-13013
      Chapter 11 Petition filed September 25, 2008
         See http://bankrupt.com/misc/azb08-13013.pdf

In Re Emerald Glass, Inc.
   Bankr. D. Ariz. Case No. 08-13016
      Chapter 11 Petition filed September 25, 2008
         See http://bankrupt.com/misc/azb08-13016.pdf

In Re Celso Roberto de dios Castro
      aka Roberto Rodriguez
   Bankr. C.D. Calif. Case No. 08-17359
      Chapter 11 Petition filed September 25, 2008
         See http://bankrupt.com/misc/cacb08-17359.pdf

In Re O'Flaherty Construction & Demolition, LLC
   Bankr. E.D. La. Case No. 08-12290
      Chapter 11 Petition filed September 25, 2008
         See http://bankrupt.com/misc/laeb08-12290.pdf

In Re Stalin, LLC
   Bankr. D. Md. Case No. 08-22328
      Chapter 11 Petition filed September 25, 2008
         See http://bankrupt.com/misc/mdb08-22328.pdf

In Re Albert Muhammad
   Bankr. D. Md. Case No. 08-22339
      Chapter 11 Petition filed September 25, 2008
         See http://bankrupt.com/misc/mdb08-22339.pdf

In Re Liberty Realty, Inc.
   Bankr. D. Nev. Case No. 08-21160
      Chapter 11 Petition filed September 25, 2008
         See http://bankrupt.com/misc/nvb08-21160.pdf

In Re Good Drink, Inc.
   Bankr. N.D. N.Y. Case No. 08-13159
      Chapter 11 Petition filed September 25, 2008
         See http://bankrupt.com/misc/nynb08-13159.pdf

In Re John S. Mazella
   Bankr. S.D. N.Y. Case No. 08-23395
      Chapter 11 Petition filed September 25, 2008
         See http://bankrupt.com/misc/nysb08-23395.pdf

In Re Mecca Development Co., LLC
   Bankr. S.D. Ohio Case No. 08-59114
      Chapter 11 Petition filed September 25, 2008
         See http://bankrupt.com/misc/ohsn08-59114.pdf

In Re StingFree Technologies Co
   Bankr. E.D. Penn. Case No. 08-16232
      Chapter 11 Petition filed September 25, 2008
         See http://bankrupt.com/misc/paeb08-16232.pdf

In Re R & F Associates
      dba Dorme Village Motel
   Bankr. W.D. Penn. Case No. 08-11833
      Chapter 11 Petition filed September 25, 2008
         See http://bankrupt.com/misc/pawb08-11833.pdf

In Re Citron Jewelers, Inc.
   Bankr. W.D. Penn. Case No. 08-26341
      Chapter 11 Petition filed September 25, 2008
         See http://bankrupt.com/misc/pawb08-26341.pdf

In Re Hudec Law Offices
      aka Atty. Patrick J. Hudec
   Bankr. E.D. Wis. Case No. 08-30461
      Chapter 11 Petition filed September 25, 2008
         Filed as Pro Se

In Re Arte Hotels, LLC
   Bankr. M.D. Tenn. Case No. 08-08743
      Chapter 11 Petition filed September 25, 2008
         See http://bankrupt.com/misc/tnmb08-08743.pdf

In Re Callnet Communications, Inc.
   Bankr. S.D. Tex. Case No. 08-36096
      Chapter 11 Petition filed September 25, 2008
         See http://bankrupt.com/misc/txsb08-36096.pdf

In Re Local Telephone Service Co., Inc.
      dba Total Telephone Service
   Bankr. S.D. Tex. Case No. 08-36098
      Chapter 11 Petition filed September 25, 2008
         See http://bankrupt.com/misc/txsb08-36098.pdf

In Re Son Lam Quach
   Bankr. C.D. Calif. Case No. 08-16073
      Chapter 11 Petition filed September 26, 2008
         See http://bankrupt.com/misc/cacb08-16073.pdf

In Re Michael William Mabry & Terry Susan Mabry
   Bankr. C.D. Calif. Case No. 08-23096
      Chapter 11 Petition filed September 26, 2008
         See http://bankrupt.com/misc/cacb08-23096.pdf

In Re Paulo S.S. Filho
      aka Paulo S. Filho,
      aka Salete S. Filho,
      aka Paulo Salete Filho
   Bankr. D. Mass. Case No. 08-17246
      Chapter 11 Petition filed September 26, 2008
         See http://bankrupt.com/misc/mab08-17246.pdf

In Re Team Care Manual & Physical Therapy Co., Inc.
   Bankr. E.D. N.C. Case No. 08-06655
      Chapter 11 Petition filed September 26, 2008
         See http://bankrupt.com/misc/nceb08-06655.pdf

In Re Malka Neustadt
   Bankr. D. N.J. Case No. 08-28528
      Chapter 11 Petition filed September 26, 2008
         See http://bankrupt.com/misc/nvb08-28528.pdf

In Re Circa 1900 Restaurant and Brewery, Inc.
   Bankr. S.D. Ohio Case No. 08-59178
      Chapter 11 Petition filed September 26, 2008
         See http://bankrupt.com/misc/ohsb08-59178.pdf

In Re Integra Therapy Center, Inc.
   Bankr. D. P.R. Case No. 08-06436
      Chapter 11 Petition filed September 26, 2008
         See http://bankrupt.com/misc/prb08-06436.pdf

In Re Lydris Management II, LLC
   Bankr. N.D. Ohio Case No. 08-17270
      Chapter 11 Petition filed September 26, 2008
         Filed as Pro Se

In Re Joseph Eldred Lindsey, Jr.
      aka J.E. Lindsey
      aka Joe Lindsey
      aka Joseph Lindsey
    & Mary Helen Lindsey
      aka Mary H. Lindsey
      aka Mary Lindsey
   Bankr. C.D. Calif. Case No. 08-12423
      Chapter 11 Petition filed September 26, 2008
         Filed as Pro Se

In Re LLC Managed Interests
   Bankr. E.D. Tenn. Case No. 08-34297
      Chapter 11 Petition filed September 26, 2008
         See http://bankrupt.com/misc/tneb08-34297.pdf

In Re Hunts with Double Indoor, LLC
   Bankr. E.D. Mich. Case No. 08-63539
      Chapter 11 Petition filed September 27, 2008
         See http://bankrupt.com/misc/mieb08-63539.pdf

In Re Brewster's Contracting Services, LLC
      fdba Brewster's Turf and Management, LLC
   Bankr. E.D. Tenn. Case No. 08-34305
      Chapter 11 Petition filed September 27, 2008
         See http://bankrupt.com/misc/tneb08-34305.pdf

In Re Rosa Maria Nunez
      aka Rosie Nunez
   Bankr. C.D. Calif. Case No. 08-26079
      Chapter 11 Petition filed September 29, 2008
         See http://bankrupt.com/misc/cacb08-26079.pdf

In Re Marc Johnson
      aka Marc Boutayer
   Bankr. C.D. Calif. Case No. 08-26092
      Chapter 11 Petition filed September 29, 2008
         See http://bankrupt.com/misc/cacb08-26092.pdf

In Re Moto Meccanica, LLC
   Bankr. N.D. Calif. Case No. 08-12047
      Chapter 11 Petition filed September 29, 2008
         See http://bankrupt.com/misc/canb08-12047.pdf

In Re Randall E. Gentry
   Bankr. M.D. Fla. Case No. 08-15094
      Chapter 11 Petition filed September 29, 2008
         See http://bankrupt.com/misc/flmb08-15094.pdf

In Re MJ&J BAGELS
   Bankr. N.D. Ill. Case No. 08-25865
      Chapter 11 Petition filed September 29, 2008
         See http://bankrupt.com/misc/ilnb08-25865.pdf

In Re Paper N Things Too With Pretty in Ink, LLC
   Bankr. M.D. La. Case No. 08-11336
      Chapter 11 Petition filed September 29, 2008
         See http://bankrupt.com/misc/lamb08-11336.pdf

In Re Ueno Sushi Brookline, Inc.
   Bankr. D. Mass. Case No. 08-17331
      Chapter 11 Petition filed September 29, 2008
         See http://bankrupt.com/misc/mab08-17331.pdf

In Re Gale Group, Ltd.
   Bankr. S.D. N.Y. Case No. 08-13777
      Chapter 11 Petition filed September 29, 2008
         See http://bankrupt.com/misc/nysb08-13777.pdf

In Re Jon Darrell Franks
   Bankr. C.D. Calif. Case No. 08-17467
      Chapter 11 Petition filed September 29, 2008
         Filed as Pro Se

In Re Aesthetic Permanent Cosmetics
      aka Aessthetic Permanent Cosmetics
   Bankr. S.D. Texas Case No. 08-36160
      Chapter 11 Petition filed September 29, 2008
         See http://bankrupt.com/misc/txsb08-36160.pdf

In Re Love and Charity Mission, Inc.
   Bankr. E.D. Wis. Case No. 08-30631
      Chapter 11 Petition filed September 29, 2008
         See http://bankrupt.com/misc/wieb08-30631.pdf

In Re Gold Coast Agency, Inc.
   Bankr. S.D. Fla. Case No. 08-24354
      Chapter 11 Petition filed September 30, 2008
         See http://bankrupt.com/misc/flsb08-24354.pdf

In Re A&M Contracting, LLC
   Bankr. N.D. Ga. Case No. 08-43238
      Chapter 11 Petition filed September 30, 2008
         See http://bankrupt.com/misc/ganb08-43238.pdf

In Re Building Service Contractors Association International
   Bankr. N.D. Ill. Case No. 08-26192
      Chapter 11 Petition filed September 30, 2008
         See http://bankrupt.com/misc/ilnb08-26192.pdf

In Re Lama Gas, Inc.
   Bankr. D. Mass. Case No. 08-17419
      Chapter 11 Petition filed September 30, 2008
         See http://bankrupt.com/misc/mab08-17419.pdf

In Re The Post Office, LLC
   Bankr. D. Md. Case No. 08-22582
      Chapter 11 Petition filed September 30, 2008
         See http://bankrupt.com/misc/mab08-22582.pdf

In Re Pirate Queen Paddling, LLC
   Bankr. E.D. N.C. Case No. 08-06743
      Chapter 11 Petition filed September 30, 2008
         See http://bankrupt.com/misc/nceb08-06743.pdf

In Re Sweetland, LLC
   Bankr. D. N.H. Case No. 08-12812
      Chapter 11 Petition filed September 30, 2008
         See http://bankrupt.com/misc/nhb08-12812.pdf

In Re FH Resort Developers, LLC
   Bankr. D. Ariz. Case No. 08-13354
      Chapter 11 Petition filed September 30, 2008
         Filed as Pro Se

In Re Jamelia's Bar & Grill, Inc.
   Bankr. N.D. Tex. Case No. 08-34866
      Chapter 11 Petition filed September 30, 2008
         Filed as Pro Se

In Re Robert Ballard Surles, Jr.
   Bankr. D. Colo. Case No. 08-25122
      Chapter 11 Petition filed September 30, 2008
         Filed as Pro Se

In Re Melvin Hartner Ministries, Inc.
   Bankr. D. Ariz. Case No. 08-13297
      Chapter 11 Petition filed September 30, 2008
         Filed as Pro Se

In Re Glass Slipper, LLC
   Bankr. D. Ariz. Case No. 08-13367
      Chapter 11 Petition filed September 30, 2008
         Filed as Pro Se

In Re William Douglas Walker
   Bankr. D. S.C. Case No. 08-06015
      Chapter 11 Petition filed September 30, 2008
         See http://bankrupt.com/misc/scb08-06015.pdf

                             *********

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
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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
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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.  Julybien D. Atadero, Sheryl Joy P. Olano, Ronald C. Sy, Joel
Anthony G. Lopez, Cecil R. Villacampa, 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.

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