TCR_Public/090106.mbx          T R O U B L E D   C O M P A N Y   R E P O R T E R

             Tuesday, January 6, 2009, Vol. 13, No. 5

                             Headlines


AMC ENTERTAINMENT: Affiliates Sell 100% Stake in Grupo Cinemex
AMERALIA INC: Sept. 30 Balance Sheet Upside Down by $68.4 Million
ATHEROGENICS INC: Court Sets February 17 General Bar Date
ATLANTA FIGHT: Case Summary & 20 Largest Unsecured Creditors
AUSAM ENERGY: Files for Chapter 11 Due to Liquidity Woes

AXLETECH INTERNATIONAL: S&P Withdraws 'B+' Corporate Credit Rating
BALLANTYNE RE: Non-Payment of Interest Cues S&P's 'D' Note Rating
BALLET BC: Proposes Restructuring Plan to Creditors
BALTIMORE CITY: Moody's Affirms 'Ba1' Rating on $50.4 Mil. Bonds
BERNARD L. MADOFF: Customers Have Until March 3 to File Claims

BERNARD L. MADOFF: Got $10MM From Martin Rosenman Before Arrest
BERNARD L. MADOFF: Court OKs Transfer of $29MM From BoNY Account
BERNARD L. MADOFF: SIPA Trustee Taps Lazard for Trading Ops Sale
BERNARD L. MADOFF: Remains Free on Bail, Violates Asset Freeze
BERNARD L. MADOFF: Trustee Identifies $830-Mil. in Liquid Assets

BERNARD L. MADOFF: Firms Begin Probing Claims; Court Stays Suits
BROADSTRIPE LLC: Files for Bankruptcy; Secures $15MM DIP Facility
CENTENNIAL COMMS: No Exact Date Yet on Shareholders Meeting
CESARE VAUGHAN: Case Summary & 20 Largest Unsecured Creditors
CHRYSLER LLC: U.S. Sales Drop 53% in December 2008 From 2007

CONSECO INC: Increased Financial Pressure Cues Fitch Cut
COUNT ME IN: May Sell Assets to Pay $5 Million to Creditors
COVER-ALL INC: Case Summary & 19 Largest Unsecured Creditors
CYRUS REINSURANCE: S&P Withdraws 'BB+' Senior Secured Loan Rating
DOUBLE JJ: Court Okays Lease Agreement with AEG Live

ECLIPSE AVIATION: To Seek Approval of Sale of Biz Jan. 16
EDDIE WIGGINS: Reopens After Filing for Chapter 11 Protection
ELLIOTT DONALD: Case Summary & 20 Largest Unsecured Creditors
E*TRADE FINANCIAL: Regulator Imposes $1MM Fine Against Firm
FLAGSTAR BANK: Moody's Confirms 'D+' Financial Strength Rating

FORD MOTOR: Auto Sales Drop More Than 30% in December 2008
FRANK GORMAN: Court Okays Reorganization Plan
FRONTIER AIRLINES: Seeks June 4 Extension of Plan Filing Deadline
GATEHOUSE MEDIA: Bank Debt Sells at Almost 90% Discount
GATEHOUSE MEDIA: Files Copyright Infringement Suit v. N.Y. Times

GENESIS HOSPICE: Voluntary Chapter 11 Case Summary
GREEKTOWN CASINO: Hires Fine Point as New Management Consultants
HARRAH'S ENTERTAINMENT: Moody's Raises Ratings to 'Caa1/LD'
HANOVER INSURANCE: Moody's Reviews 'Ba1' Insurance Strength Rating
HORIZON HOTEL: Involuntary Chapter 11 Case Summary

HRP MYRTLE: Seeks to Convert Case to Chapter 7 Liquidation
INTERLAKE MATERIAL: Financial Crisis Prompts Chapter 11 Filing
INTERLAKE MATERIAL: Case Summary & 30 Largest Unsecured Creditors
J.M. CAPITAL: Case Summary & Largest Unsecured Creditor
KB TOYS: Li & Fung Faces $10-Mil. Payment Demand from HK Toymakers

KEY PLASTICS: Court Sets Jan. 29 Disclosure Statement Hearing
KP FASHION: Files for Chapter 11 Bankruptcy in New York
LEAP WIRELESS: Posts $93 Million Net Loss in Last Nine Months
LEE ENTERPRISES: Lenders Waive Credit and Pulitzer Deal Violations
LEE ENTERPRISES: Posts $879.9MM Net Loss for Year Ended Sept. 28

LEHMAN BROTHERS: Wins Court Nod on Derivative Contracts Protocol
LEHMAN BROTHERS: Disposition of Trade Confirmations Approved
LEHMAN BROTHERS: Seeks to Extend Time to Decide on Leases
LEHMAN BROTHERS: Wants Schedules Filing Deadline Moved to March 16
LEHMAN BROTHERS: Kamco May Purchase Japanese Distressed Assets

LEHMAN BROTHERS: Court OKs Sale of Aircraft to Pegasus & Peregrine
LEHMAN BROTHERS: Assumes Admin. Services Contract with Aetna
LEHMAN BROTHERS: Gets Approval to Reject Drug Program with Medco
LEHMAN BROTHERS: Court Approves Retention of Professionals
LEVEL 3: S&P Raises Corporate Credit Rating to 'B-' from 'SD'

LIFE FLIGHT: Case Summary & 20 Largest Unsecured Creditors
LITHIUM TECH: Files Financial Reports for March 31 & June 30 Qtrs.
LYONDELLBASELL: Inches Closer to Chapter 11 Bankruptcy
LYONDELLBASELL: Default Swaps Rise on Bankruptcy Speculations
LYONDELLBASELL: Moody's Junks Corporate Family Rating

LYONDELLBASELL: Likely Chapter 11 Filing Cues Fitch's Junk Rating
MAINSTREAM MEDIA: Files for Chapter 11 Protection
MAJESTIC PLAZA: Voluntary Chapter 11 Case Summary
MEDICOR LTD: Court Extends Plan Filing Period to Dec. 29, 2008
MEDICOR LTD: Files Chapter 11 Plan and Disclosure Statement

MIGENIX INC: Oct. 31 Balance Sheet Upside Down by CC$5.2 Million
NAVISTAR INTL: Projects Up to $410 Million in 2009 Net Income
NEBRASKA BOOK: S&P Puts 'B-' Corporate Rating on Negative Watch
NORTHSTAR NEUROSCIENCE: Board Approves Plan to Dissolve Business
PENN TREATY: Review of Events Cues Delay in Form 10-Q Filing

PENN TREATY: Restructuring Plan Cues NYSE to Remove Common Stock
PENN TREATY: Sells UIG Subsidiary to LTC for $14.2 Million
PENN TREATY: To Sell American Network Insurance
PULMONARY & INTERNAL: Case Summary & 20 Largest Unsec. Creditors
QUAIL VALLEY: Case Summary & 20 Largest Unsecured Creditors

QUEBECOR WORLD: May Ink Pacts With Tennessee Development Boards
QUEBECOR WORLD: Receives Notices on 256,364 of Series 5 Shares
QUEBECOR WORLD: Files Amended Financial Results for 2007
RAD/ONE: Case Summary & 20 Largest Unsecured Creditors
RECYCLED PAPER: RPG Investment Balks at Sale to American Greeting

RYLAND GROUP: Board of Directors Adopts Stockholder Rights Plan
SMITTY'S BUILDING: Housing Slump Forces Bankruptcy Filing
SONICBLUE INC: Emerges from Bankruptcy; Liquidation Plan Effective
SONORA ENVIRONMENTAL: Voluntary Chapter 11 Case Summary
SOUTHERN TRACE: Case Summary & 20 Largest Unsecured Creditors

STANDARD PACIFIC: Board Elects Ken Campbell as President and CEO
SUN-TIMES MEDIA: Inks Severance Deals with 2 Executives
TRONOX INC: Has Until January 9 to Pay Interest on $350MM Loan
TRUMP ENTERTAINMENT: Interest Non-Payment Cues Moody's 'D' Rating
US INVESTIGATIONS: Moody's Affirms 'B3' Rating With Stable Outlook

USP SPC: S&P Downgrades Rating Senior Notes to 'D' From 'CCC-'
VCENTRIX, INC.: Voluntary Chapter 11 Case Summary
VITESSE SEMICONDUCTOR: Auditor Raises Going Concern Doubt
WEST HAWK: $10.6MM Trade Debt Agreement Terminated
WILSON MANUFACTURING: Files for Chapter 11 in Oklahoma

XIOM CORP: Auditor's Opinion Delays Filing of Quarterly Report
* Duane Morris Snags Dewey & LeBoeuf's Schrag and Heuer

* Large Companies with Insolvent Balance Sheets


                             *********

AMC ENTERTAINMENT: Affiliates Sell 100% Stake in Grupo Cinemex
--------------------------------------------------------------
AMC Entertainment Inc. disclosed in a filing with the Securities
and Exchange Commission that certain of its subsidiaries and
Entretenimiento GM de Mexico S.A. de C.V. have reached an
agreement and entered into a definitive Stock Purchase Agreement
for the sale of the 100% ownership interest in Grupo Cinemex, S.A.
de C.V. and Symphony Subsisting Vehicle, S. de R.L. de C.V. owned
by AMCE and its subsidiaries to Entretenimiento.  Cinemex operates
44 theaters with 493 screens in the Mexico City Metropolitan area.

The Agreement provides for the stockholders of Cinemex and equity
holders of Symphony to receive $315,000,000 decreased by the
amount of net funded indebtedness of Cinemex of approximately
$77,500,000 as of Sept. 30, 2008, and other specified items in
exchange for all of their equity interests in Cinemex and
Symphony.  The amount of net funded indebtedness of Cinemex will
fluctuate through the closing of the Sale depending on the amount
of cash and cash equivalents of Cinemex at closing and the US
dollar exchange rates for the Mexican peso.

The Sale, which is expected to close on or about January 2009, is
subject to customary closing conditions, including approval by the
Mexican Federal Competition Commission.  The Agreement provides
that, upon termination of the Agreement without completing the
Sale, AMCE may be obligated, under certain circumstances, to pay
Entretenimiento liquidated damages of $50,000,000 and
Entretenimiento may be obligated, under certain circumstances, to
pay AMCE liquidated damages of $50,000,000.

                     About AMC Entertainment

Headquartered in Kansas City, Missouri, AMC Entertainment Inc.
-- http://www.amctheatres.com/-- is a theatrical exhibition
company.  As of July 3, 2008, the company owned, operated or had
interests in 353 theatres and 5,117 screens, with 89% or 4,569 of
its screens in the U.S. and Canada and 11%, or 548 of its screens
in Mexico, China (Hong Kong), France and the United Kingdom.

The company's principal direct and indirect owned subsidiaries are
American Multi-Cinema Inc., Grupo Cinemex, S.A. de C.V. and AMC
Entertainment International Inc.

For thirteen weeks ended Oct. 2, 2008, the company reported net
earnings of $3.6 million compared with net earnings of
$36.9 million for the same period in the previous year.

For twenty-six weeks ended Oct. 2, 2008, the company reported net
earnings of $14.4 million compared with net earnings of
$59.0 million for the same period in the previous year.

At Oct. 2, 2008, the company's balance sheet showed total assets
of $3.7 billion, total liabilities of $2.6 billion and
stockholders' equity of $1.1 billion.

As of Oct. 2, 2008, the company was in compliance with all
financial covenants relating to the Senior Secured Credit
Facility, the Cinemex Credit Facility, the Notes due 2016, the
Notes due 2014, and the Fixed Notes due 2012.

                          *     *     *

To date, AMC Entertainment Inc. still carries Fitch Ratings'
'CCC+' senior subordinate rating assigned on Jan. 12, 2006.


AMERALIA INC: Sept. 30 Balance Sheet Upside Down by $68.4 Million
-----------------------------------------------------------------
AmerAlia, Inc.'s September 30, 2008, balance sheet showed total
assets of $37,809,482 and total liabilities of $90,726,469,
resulting in total stockholders' deficit of $68,440,196.  AmerAlia
also showed strained liquidity with $89,823,808 total current
liabilities greatly exceeding $4,794,618 total current assets.

The company posted a net loss of $3,706,193 for the three months
ended September 30, 2008, compared with $1,015,687 in the previous
year, an increase of 265%.  "The company has an accumulated
deficit of approximately $109 million as of September 30, 2008.
The company has not yet established revenues from operations
sufficient to cover its operating costs, which creates substantial
doubt as to whether it can continue as a going concern," President
Bill H. Gunn disclosed in a regulatory filing dated December 30,
2008.

"The ability of the company to continue as a going concern is
dependent on obtaining adequate capital to fund operating losses.
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 have to refinance its debt due to the
Sentient Entities and secure additional capital resources."

On October 31, 2008 the company completed the first stage of a
Restructuring Agreement with Sentient USA Resources Fund, L.P.,
Sentient USA Resources Fund II, L.P., and Sentient Global
Resources Fund III, L.P. Under the agreement, Sentient exchanged
all its various promissory notes, debentures, rights to interest
and it 53.5% share of Natural Soda, Inc., for 82% of the equity of
Natural Soda Holdings, Inc., and shares of the company.  Sentient
also subscribed $5,500,000 in cash for additional shares of the
company's common stock and certain officers, directors and
creditors exchanged obligations due to them for shares.
Consequently, many creditors have been repaid.  The Amendment to
the Restructuring Agreement also provides for a second closing
when Sentient will purchase an additional 12,149,628 shares of
AmerAlia Common Stock for $4,373,866.

A full-text copy of the company's quarterly report is available
for free at: http://researcharchives.com/t/s?3749

On December 22, 2008, the company also filed its annual report for
the fiscal year ended June 30, 2008, wherein its independent
auditor, HJ & Associates, LLC, in Salt Lake City, Utah, expressed
substantial doubt about the company's ability to continue as a
going concern.

A full-text copy of the company's annual report is available for
free at: http://researcharchives.com/t/s?374a

                         About AmerAlia

AmerAlia, Inc., is in the business of selling a range of natural
products initially derived from the recovery of its natural sodium
resources, the utilization of its water rights and of seeking
title to oil shale resources intermingled with its sodium
resource.  These resources are located in the Piceance Creek Basin
in North West Colorado.


ATHEROGENICS INC: Court Sets February 17 General Bar Date
---------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Georgia set
Feb. 17, 2009, as the bar date or deadline for the filing of
proofs of claim in AtheroGenics, Inc.'s bankruptcy case.  The bar
date for governmental entities is April 15, 2009.

Parties wishing to assert a claim against the Debtor that arose
prior to its bankruptcy filing must file an original proof of
claim with Administar Services Group, the Debtor's claims agent,
at this address:

By courier:                        By mail:

Administar Services Group          Administar Services Group
Attn: AtheroGenics Claims Agent    Attn: AtheroGenics Claims Agent
8475 Western Way, Suite 110        P.O. Box 56636
Jacksonville, Florida 32256        Jacksonville, Florida 32241

Headquartered in Alpharetta, Georgia, AtheroGenics, Inc. --
http://www.atherogenics.com/-- is a research-based pharmaceutical
company focused on the discovery, development and
commercialization of drugs for the treatment of chronic
inflammatory diseases, including diabetes and coronary heart
disease.  It has one late stage clinical drug development program.

On Sept. 15, 2008, five creditors holding claims totaling
$20,413,000 pursuant to the company's 4.5% Convertible Notes Due
2008 filed an involuntary Chapter 7 petition against the Debtor
(Bankr. N.D. Georgia Case No. 08-78200).  The petitioning
noteholders were:

-- AQR Absolute Return Master Account, L.P.;
-- CNH CA Master Account, L.P.;
-- Tamalpais Global Partner Master Fund, LTD;
-- Tang Capital Partners, LP; and
-- Zazove High Yield Convertible Securities Fund, L.P.

On Oct. 6, the Debtor filed its consent to entry for order for
relief and motion to convert its Chapter 7 case to one under
Chapter 11 (Bankr. N.D. Ga. Case No. 08-78200).

AtheroGenics currently contemplates that its non-cash assets will
be sold in the Chapter 11 proceeding, either through a motion
under Section 363 of the Bankruptcy Code or through confirmation
of a plan pursuant to Section 1129 of the Bankruptcy Code, and
that the then-remaining cash assets together with the net proceeds
generated through the sale of the non-cash assets will be
distributed to its stakeholders, including its creditors.  Due to
the constraints imposed on AtheroGenics by the Chapter 11
Proceeding, AtheroGenics does not anticipate pursuing any clinical
trials or other development activities relating to AGI-1067 or its
other products during the course of the Chapter 11 proceeding.

As of Sept. 30, 2008, AtheroGenics had $55,858,367 in total
assets; $306,728,421 in liabilities subject to compromise and
$303,060 in total current liabilities, not subject to compromise;
and $251,173,114 in shareholders' deficit.


ATLANTA FIGHT: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Atlanta Fight Clubs, L.L.C.
        d/b/a Knuckle Up Fitness
        5956 Roswell Road
        Atlanta, GA 30342

Bankruptcy Case No.: 08-86292

Type of Business: The Debtor offers membership for its athletic
club and gymnasiums.

Chapter 11 Petition Date: December 23, 2008

Court: United States Bankruptcy Court
       Northern District of Georgia (Atlanta)

Judge: Judge Paul W. Bonapfel

Debtor's Counsel: Leon S. Jones, Esq.
                  Jones & Walden, LLC
                  21 Eighth Street, NE
                  Atlanta, GA 30309
                  Tel.: (404) 564-9300
                  Fax : (404) 564-9301
                  Email: ljones@joneswalden.com

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

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

A full-text copy of the Debtor's petition and a list of the
Debtor's largest unsecured creditors are available for free at:

        http://bankrupt.com/misc/ganb08-86292.pdf


AUSAM ENERGY: Files for Chapter 11 Due to Liquidity Woes
--------------------------------------------------------
Ausam Energy Corporation and its wholly owned subsidiary, Noram
Resources, Inc., filed voluntary Chapter 11 bankruptcy petitions
with the United States Bankruptcy Court in Houston, Texas on
December 30, 2008.  The Company will continue its ordinary course
of business operations and will operate as a debtor-in-possession
within the bankruptcy proceeding.  The bankruptcy filings were
necessitated by the Company's inability to secure new equity or
debt financing on terms acceptable to the Company's current
primary lender.

"The Company hopes to use the protections provided by the Chapter
11 process to re-organize its capital structure and settle with
its creditors. The Company believes that the Chapter 11 filing
provides it with the best chance of preserving the value of its
business assets and maximizing the return to all of the
stakeholders of the Company," Ausam said.

                       About Ausam Energy

Based in Calgary, Alberta in Canada, Ausam Energy Corp. --
http://www.ausamenergy.com/-- is a public company engaged in the
business of oil and gas exploration and development.  Ausam,
through its U.S. subsidiary Noram Resources, Inc., has a diverse
portfolio of oil and gas leases and prospects in Texas, Louisiana,
Mississippi, Alabama and Arkansas.  The Company trades under the
symbol "AZE" on the TSX Venture Exchange and the symbol "ASMEF" on
the OTC Bulletin Board.


AXLETECH INTERNATIONAL: S&P Withdraws 'B+' Corporate Credit Rating
------------------------------------------------------------------
Standard & Poor's Ratings Services withdrew its ratings, including
the 'B+' corporate credit rating, on AxleTech International
Holdings Inc., and removed them from CreditWatch, where they were
placed with positive implications on Nov. 19, 2008.

The ratings withdrawal follows AxleTech's acquisition by General
Dynamics Corp. (A/Stable/A-1).


BALLANTYNE RE: Non-Payment of Interest Cues S&P's 'D' Note Rating
-----------------------------------------------------------------
Standard & Poor's Ratings Services said that it revised its
ratings on Ballantyne Re plc's Class A-1 and Class B notes to 'D'
from 'CCC-' and 'CC', respectively.  The rating on the Class A-1
notes had been on CreditWatch negative since Sept. 19, 2008.

Class A-1 noteholders were due an interest payment on Jan. 2,
2009, which was not made.  Although there is a three-day cure
period, the expectation is that a full payment is not forthcoming.
In addition, the interest payment on the Class A-2 Series A and
Series B notes, also due on Jan. 2 was not made.  Payments on
these notes are guaranteed by Ambac Assurance U.K. Ltd.
(A/Negative/--) and Assured Guaranty (UK) Ltd. (AAA/Stable/--)
respectively.

Any shortfall in an interest payment is expected to be made up by
these companies.  Therefore, the ratings on these notes will be
based on the rating on the guarantor.  "We expect that there will
be interest payment shortfalls on each series of Class A-3 notes
as they come due," said Standard & Poor's credit analyst Gary
Martucci.  Each of these series is guaranteed by Ambac, and any
shortfall will be paid by it.  The rating on the Class A-3 notes
will be based on the rating on Ambac.

"The shortfall is due to the continued substantial decline in the
market value of assets in the underlying collateral accounts,"
added Mr. Martucci.  "As the assets have declined in value, assets
and related cash flow that would have been used to make timely
payments on the rated notes are being used to satisfy credit for
reinsurance requirements."  In addition, there is a minimum
balance requirement in the surplus account that must be maintained
for payments to be made to noteholders.

Although the Class B notes are not technically in default, the
default of the senior notes makes the repayment on the subordinate
notes increasingly unlikely.


BALLET BC: Proposes Restructuring Plan to Creditors
---------------------------------------------------
The Georgia Straight reports that Ballet BC has proposed a
restructuring plan to its creditors.

The Straight states that each creditor, under the plan prepared by
E. Sands & Associates Inc., would be paid up to $500 of their
proven claim, while anyone owed more than that amount would get an
additional 22 cents on the dollar.

Creditors will vote on the restructuring plan on Jan. 9, 2009,
Dave Itzkoff at The New York Times relates.  The Straight says
that if the plan is approved, Ballet BC will rehire "certain
company dancers, administrative and artistic staff that were
previously laid off."

According to The NY Times, Ballet BC laid off about 38 workers in
November 2008, including its dancers and its artistic director,
John Alleyne.

If the plan is rejected, Ballet BC may have to file for
bankruptcy, says The NY Times.  Creditors owed a total of $372,000
would then receive about 19% recovery on their claims, according
to The Straight.  Mr. Alleyne has the highest claim -- $142,671.25
plus a separate claim of $113.67 -- out of a list of 176 unsecured
creditors, The Straight states.

The Straight relates that Ballet BC's executive director Susan
Howard holds a claim of $20,473, while individual dancers have
claims ranging from $230 to $787.  Ballet BC, says the report,
owes Peter Pan creator Septime Webre about $20,000, and owes about
$1,041.65 to Oscar de la Renta Ltd., which provided the costumes
for Nine Sinatra Songs.  The report states that Ballet BC's other
creditors who account for thousands of dollars in claims are:

     -- Tiko Kerr, who collaborated on Mr. Alleyne's The Four
        Seasons last spring;

     -- the Vancouver International Film Festival;

     -- UBC Theatre;

     -- the Dance Foundation;

     -- the Dance Centre;

     -- the Playhouse Theatre Company;

     -- Early Music Vancouver;

     -- Bard on the Beach;

     -- the Arts Umbrella;

     -- and the Alliance for Arts and Culture.

According to The Straight, one of the causes of Ballet BC's
financial problems was the costs for original productions that
weren't recovered through ticket sales.   Ballet BC said in its
reorganization plan that costumes, sets, score, and choreography
led to an accumulated deficit of $600,000 over the preceding three
years, The Straight relates.  Ballet BC said that its subscription
sales dropped by $150,000, and the first two performances of the
year -- Nine Sinatra Songs and The Faerie Queen -- accounted for
losses in ticket sales and revenues of $120,000, according to the
report.

The Straight reports that as of Dec. 23, 2008, Ballet BC had about
$12,000 cash on hand.

After its year-end production of "The Nutcracker", Ballet BC has
canceled planned tours, The NY Times relates.  The Straight states
that for people who hold tickets to scheduled productions for
Carmen and A Streetcar Named Desire in the New Year, Ballet BC
said, "In the event the Proposal is not accepted by the creditors,
the Ticket Holders will become creditors in the bankruptcy."
About 1,669 and 1,529 tickets were sold for the Carmen and A
Streetcar productions respectively, totaling about $137,000, the
report states.

Ballet BC -- http://www.balletbc.com/-- is a Vancouver dance
company.


BALTIMORE CITY: Moody's Affirms 'Ba1' Rating on $50.4 Mil. Bonds
----------------------------------------------------------------
Moody's Investors Service has affirmed the underlying Baa3 rating
on the City of Baltimore, Maryland's Convention Center Hotel
Revenue Bonds, Senior Series 2006A and the Ba1 on the City's
$50.4 million Subordinate Series 2006B Convention Center Hotel
Revenue Bonds. The rating outlook is stable.

Legal security: The bonds are secured by loan payments from the
Baltimore Hotel Corporation equal to debt service, which will in
turn be secured by the net revenues of the hotel and a first lien
mortgage on the facility, both of which is pledged directly to
bondholders.  In addition, the City has covenanted to budget and
appropriate annually for the purposes of paying debt service an
amount equal to the hotel occupancy taxes generated by the hotel
(site-specific HOT, currently equal to 7.5% of room revenues), the
property taxes (tax increment revenues) paid by the hotel to the
city, and up to $7 million of city-wide hotel occupancy taxes
(city-wide HOT, equal to 25% of maximum annual debt service on the
Series 2006A and 2006B bonds combined).  The bonds are
additionally secured by various reserve funds.

Interest rate derivatives: None

                            Strengths

* High level of ongoing municipal support.  Tax revenue
  contributions could total up to 86% or more of senior lien debt
  service in the stabilized year

* Substantial reserves

* Well positioned in a historically strong hospitality market

* Hilton brings substantial expertise, resources, and brand-name
  recognition to the project, along with providing a substantial
  financial guarantee

                            Challenges

* The project operates in a highly competitive market, with five
  other high quality hotels located nearby, along with a number of
  limited service hotels and several new properties expected to be
  constructed in the coming years

* The project may contribute to a near-term supply and demand
  imbalance in Baltimore given the pressured national economy and
  expectations of sluggish hotel industry performance in 2009 that
  could depress occupancy and room rates for the hotel project and
  its competitors.

* The hotel is dependent in large part on the convention center's
  ability to compete successfully with convention centers in other
  cities along the Eastern seaboard, an increasingly crowded
  field.

                       Recent Developments

The Baltimore Hilton opened in August 2008 (grand opening in
October 2008) on schedule and within its construction budget.
While some of the primary retail space within the hotel remains
unfilled, the city officials report the property has assisted in
generating new bookings for the convention center.  Given the
ongoing recession the hotel will be challenged to meet initial
operating projects as a handful of national hotel tracking firms
have projected upwards of a 10% decline in Revenue Per Available
Room nationwide in 2009.

The occupancy rate of the hotel's prospective competitive set was
essentially flat in 2007 (67.8% in 2007, 67.7% in 2007) and
tracking close to 2007 levels through May of 2008.  Average Daily
Rate grew 4.5% to $173.15 from $165.73 in 2007.  The consultant's
initial projections for 2011 (by which time the hotel is expected
to have stabilized) forecast a 74% occupancy rate (slightly above
that of the primary competitive set in 2004), $208 ADR (in nominal
$; equal to $175 in 2005$, roughly 5% higher than the $167 ADR for
the primary competitive set in 2004), and 4.5 times senior and 2.5
times subordinate debt service coverage (debt service net of
$7 million available city-wide hotel taxes).

A Moody's stress scenario with an occupancy rate of 56% shows that
the hotel needs to achieve an ADR of at least $140 (2005$) to pay
debt service on the senior lien bonds and make required deposits
equal to 4% of revenues to the furniture, fixtures, and equipment
reserve fund, taking into account the available municipal support.
To pay the subordinated bonds, (which are payable after senior
FF&E deposits, the deferred insurance premium, and administrative
expenses of the Corporation), an ADR of $166 (2005$) would be
required, slightly below the average ADR of the primary
competitive set in 2004.

                              Outlook

The stable outlook incorporates Moody's expectation that the hotel
will weather the current economic conditions and provide adequate
debt service coverage.

                 What Could Change The Rating - Up

The rating could increase if the property's financial performance
significantly exceeds Moody's expectations.

                What Could Change The Rating - Down

The rating could face downward pressure if prolonged economic
pressures result in strained operating performance that increases
reliance on municipal support.

                          Key Indicators

  -- Facility Size: 757 rooms

  -- Reserves (as of 11/30/08):

  -- Operating Reserve: $9 million

  -- Owner's Contingency Reserve: $12.9 million

  -- Senior Debt Service Reserve: $8.4 million

  -- Subordinate Debt Service Reserve: $3.9 million

  -- Hilton Guarantee: $25 million

  -- Minimum Cash Trap Fund Amount: $10 million (funded from net
     revenues)

                         Debt Outstanding

  -- Convention Center Hotel Revenue Bonds, Senior Series 2006A,
     $247.5 million

  -- Convention Center Hotel Revenue Bonds, Subordinate Series
     2006B, $50.4 million


BERNARD L. MADOFF: Customers Have Until March 3 to File Claims
--------------------------------------------------------------
As reported by the Troubled Company Reporter on Dec. 16, 2008, the
Securities Investor Protection Corporation, which maintains a
special reserve fund authorized by Congress to help investors at
failed brokerage firms, dislosed last Dec. 15, 2008, that it is
liquidating Bernard L. Madoff Investment Securities LLC of New
York, N.Y., under the Securities Investor Protection Act of 1970.
Irving H. Picard, Esq., was appointed Trustee for the Liquidation
of the Business of the Debtor, and Baker & Holstetler LLP was
appointed as counsel to the Trustee.

Mr. Picard announced on Jan. 2, 2009, that customers of the Debtor
who wish to avail themselves of the protection afforded to them
under SIPA are required to file their claims within 60 days, or by
March 3, 2009.  Customers may file their claims up to six months;
however, the filing of claims after the 60-day period but within
the six-month period may result in less protection for the
customer.  Claims should be filed with the Trustee at:

    Irving H. Picard, Esq.
    Trustee for Bernard L. Madoff Investment Securities LLC
    Claims processing Center
    2100 McKinney Avenue
    Suite 800, Dallas
    Texas 75201

Claims by broker-dealers for the completion of open contractual
commitments must be filed with the Trustee at the above address
within 30 days, or by Feb. 1, 2009.  All other creditors of the
Debtor must file formal proofs of claim with the Trustee at the
above address within 6 months, or by July 2, 2009.

The first meeting of customers and creditors will be held on
Feb. 20, 2009, at 10:00 a.m., at the Auditorium at the U.S.
Bankruptcy Court for the Southern District of New York, One
Bowling Green, in New York City.

                      8,000 Claim Forms Sent

According to SIPC, Mr. Picard mailed on January 2 over 8,000
customer claim forms, with detailed instructions for the
completion and filing of the forms with the trustee; claim forms
and related information to general creditors of BLMIS; and claims
filing information to brokers and dealers.

In addition, the trustee published a detailed notice to customers
and creditors of the placement of BLMIS in liquidation under the
Securities Investor Protection Act (SIPA) in the New York Times,
Wall Street Journal, Financial Times, International Herald
Tribune, USA Today and two Israeli newspapers (Jerusalem Post and
Ye'diot Achronot).  The published notice provides information
regarding the claims process, including instructions on how, where
and by when to file a claim.

Although SIPA requires the trustee to provide notice of a
liquidation proceeding to persons who appear to have been
customers of the debtor with open accounts within the past 12
months, any person may file a claim.  The published liquidation
notice contains an address from which a claim form may be
requested.  In addition, the notice, claim forms and related
claims information are available for downloading on the trustee's
Web site -- http://www.madofftrustee.com/-- and on the SIPC Web
site -- http://www.sipc.org/.

The notice contains deadlines for the filing of claims with the
trustee: March 4, 2009 and July 2, 2009.  A failure to file a
claim by the final deadline, even if by one day, will result in a
denial of the claim, the SIPC said.

The trustee and his staff will review and determine all claims
seeking customer protection in accordance with SIPA.  Claimants
are requested to provide complete information and documentation
relating to their claim, including proof of payments made to BLMIS
and received from BLMIS, as this may help to expedite the
processing of the claim.

The trustee is proceeding as expeditiously as possible to address
the claims of all of the customers of BLMIS in a timely manner."

                    Rosenman Sues for $10-Mil.

Rosenman Family LLC, managed by Martin Rosenman, president
of Bronx-based Stuyvesant Fuel Service Corp., has filed an
adversary proceeding before the Bankruptcy Court against Madoff's
estate, seeking payment for the $10 million he sent to Madoff on
Dec. 5, just days before Mr. Madoff was charged and arrested for
fraud.

"It's going to be months before it even comes before the
judge, unless he asks for immediate relief through a motion," said
Carren Shulman, a bankruptcy partner at the law firm Sheppard
Mullin Richter & Hampton in New York, according to Bloomberg.

                   About Bernard L. Madoff

Bernard L. Madoff Investment Securities LLC was a market maker in
US stocks, including all of the S&P 500 and more than 350 Nasdaq
stocks.  The firm moved large blocks of stock for institutional
clients by splitting up orders or arranging off-exchange
transactions between parties.  It also performed clearing and
settlement services.  Clients included brokerages, banks, and
other financial institutions.  In addition, Madoff Securities
managed assets for high-net-worth individuals, hedge funds, and
other institutional investors.

The firm is being liquidated in the aftermath of a fraud scandal
involving founder Bernard L. Madoff.

As reported by the Troubled Company Reporter on Dec. 15, 2008, the
Securities and Exchange Commission charged Bernard L. Madoff and
his investment firm, Bernard L. Madoff Investment Securities LLC,
with securities fraud for a multi-billion dollar Ponzi scheme that
he perpetrated on advisory clients of his firm.  The estimated
losses from Madoff's fraud were at least $50 billion.


BERNARD L. MADOFF: Got $10MM From Martin Rosenman Before Arrest
---------------------------------------------------------------
Court documents say that Bernard Madoff received $10 million from
Martin Rosenman, managing member of Rosenman Family LLC and
president of Stuyvesant Fuel Service Corp., six days before he was
arrested for alleged fraud.

Dionne Searcey and David McLaughlin at The Wall Street Journal
relates that Mr. Rosenman has filed a lawsuit against Mr. Madoff,
seeking to recover the funds he wired to Mr. Madoff's account at a
J.P. Morgan Chase & Co. branch on Dec. 5, 2008.

Rosenman Family invested with Mr. Madoff after Mr. Rosenman's
friends convinced him to do so, WSJ says, citing Howard
Kleinhendler, the attorney for Mr. Rosenman.  According to WSJ,
Mr. Kleinhendler said that Mr. Madoff told Mr. Rosenman that he
would take the money and invest it after the start of 2009.
Mr. Kleinhendler, says the report, thinks that Mr. Rosenman may
have better luck compared to other investors filing lawsuits
against Mr. Madoff, because Mr. Rosenman's $10 million investment
was so recent that it may be easier to trace.

WSJ reports that Mr. Rosenman, after investing $10 million with
Mr. Madoff, received a confirmation from Mr. Madoff's firm,
stating that the Rosenmans Family had sold short about
$10 million in U.S. Treasury bills that mature on March 26, 2009.
Court documents say that Mr. Rosenman never authorized this
transaction.  According to the report, the identification number
for the securities couldn't be found through electronic searches.
Mr. Madoff's firm, court documents say, never transacted a trade
of U.S. Treasury bills on Rosenman Family's behalf.  According to
court documents, the Rosenmans believe that the money was never
transferred from the J.P. Morgan Chase account.  Mr. Madoff was
hoarding cash to distribute among workers, and so the money was
never distributed, WSJ states, citing Mr. Kleinhendler.

According to WSJ, Mr. Rosenman filed the complaint against Irving
H. Picard, the court-appointed trustee for the liquidation of
Bernard L. Madoff Investment Securities LLC, and also named J.P.
Morgan Chase, the holder of Mr. Madoff's account, as a defendant.

                     About Bernard L. Madoff

Bernard L. Madoff Investment Securities LLC was a market maker in
US stocks, including all of the S&P 500 and more than 350 Nasdaq
stocks.  The firm moved large blocks of stock for institutional
clients by splitting up orders or arranging off-exchange
transactions between parties.  It also performed clearing and
settlement services.  Clients included brokerages, banks, and
other financial institutions.  In addition, Madoff Securities
managed assets for high-net-worth individuals, hedge funds, and
other institutional investors.

The firm is being liquidated in the aftermath of a fraud scandal
involving founder Bernard L. Madoff.

As reported by the Troubled Company Reporter on Dec. 15, 2008, the
Securities and Exchange Commission charged Bernard L. Madoff and
his investment firm, Bernard L. Madoff Investment Securities LLC,
with securities fraud for a multi-billion dollar Ponzi scheme that
he perpetrated on advisory clients of his firm.  The estimated the
losses from Madoff's fraud were at least
US$50 billion.

As reported by the TCR on Dec. 16, 2008, the Securities Investor
Protection Corporation, which maintains a special reserve fund
authorized by Congress to help investors at failed brokerage
firms, announced on Mon., Dec. 15, that it is liquidating Bernard
L. Madoff Investment Securities LLC of New York, N.Y., under the
Securities Investor Protection Act.


BERNARD L. MADOFF: Court OKs Transfer of $29MM From BoNY Account
----------------------------------------------------------------
Stephen Harbeck, president of the Securities Investor Protection
Corporation, which maintains a special reserve fund authorized by
U.S. Congress to help investors at failed brokerage firms, and
Irving H. Picard, the court-appointed trustee for the liquidation
of Bernard L. Madoff Investment Securities LLC of New York, NY,
said on December 30, 2008:

"We are pleased that today the United States Bankruptcy Court for
the Southern District of New York approved the transfer of $29
million in debtor funds held by the Bank of New York (BONY).  This
is one of many steps that Trustee Irving H. Picard has taken and
will continue to take to collect all available assets of Bernard
L. Madoff Investment Securities LLC for the future use of
satisfying customer claims and other purposes.

"We want to be very clear that to the extent these and other funds
are 'customer property,' they will be used for satisfying customer
claims and not the administrative expenses of the Trustee.
Contrary to some recent media accounts, trustee expenses are paid
out of any general estate of the debtor, and if insufficient,
through advances by SIPC.  Customer property may not be used to
pay the administrative expenses of a liquidation proceeding.
Under the Securities Investor Protection Act, the trustee is
empowered to recover customer property so that it may be returned
to customers in need of protection under that law.  Because
expenditures by the trustee to recover such property and other
administrative expenses of the trustee are borne by the general
estate and SIPC and not by customers, such expenditures diminish
in no way the amount of customer property available for customers.

"Separately, we want it to be known that a claim form will be
available shortly for the Madoff liquidation proceeding.  The
Trustee will mail claim forms by no later than January 9, 2009, to
customers and creditors of Bernard L. Madoff Investment Securities
LLC.  In addition to being mailed, the forms will be available on
the Web for downloading at http://www.sipc.organd
http://www.madoff.com Those filing the form will need to use the
forms created specifically for the purposes of the Madoff
liquidation proceeding."

                            ABOUT SIPC

The Securities Investor Protection Corporation is the U.S.
investor's first line of defense in the event a brokerage firm
fails, owing customer cash and securities that are missing from
customer accounts. SIPC either acts as trustee or works with an
independent court-appointed trustee in a brokerage insolvency case
to recover funds.

The statute that created SIPC provides that customers of a failed
brokerage firm receive all non-negotiable securities -- such as
stocks or bonds -- that are already registered in their names or
in the process of being registered.  At the same time, funds from
the SIPC reserve are available to satisfy the remaining claims of
each customer up to a maximum of $500,000.  This figure includes a
maximum of $100,000 on claims for cash.  From the time Congress
created it in 1970 through December 2007, SIPC has advanced
$507 million in order to make possible the recovery of $15.7
billion in assets for an estimated 626,000 investors.

                   About Bernard L. Madoff

Bernard L. Madoff Investment Securities LLC was a market maker in
US stocks, including all of the S&P 500 and more than 350 Nasdaq
stocks.  The firm moved large blocks of stock for institutional
clients by splitting up orders or arranging off-exchange
transactions between parties.  It also performed clearing and
settlement services.  Clients included brokerages, banks, and
other financial institutions.  In addition, Madoff Securities
managed assets for high-net-worth individuals, hedge funds, and
other institutional investors.

The firm is being liquidated in the aftermath of a fraud scandal
involving founder Bernard L. Madoff.

As reported by the Troubled Company Reporter on Dec. 15, 2008, the
Securities and Exchange Commission charged Bernard L. Madoff and
his investment firm, Bernard L. Madoff Investment Securities LLC,
with securities fraud for a multi-billion dollar Ponzi scheme that
he perpetrated on advisory clients of his firm.  The
estimated the losses from Madoff's fraud were at least
US$50 billion.

As reported by the TCR on Dec. 16, 2008, the Securities Investor
Protection Corporation, which maintains a special reserve fund
authorized by Congress to help investors at failed brokerage
firms, announced on Mon., Dec. 15, that it is liquidating Bernard
L. Madoff Investment Securities LLC of New York, N.Y., under the
Securities Investor Protection Act.


BERNARD L. MADOFF: SIPA Trustee Taps Lazard for Trading Ops Sale
----------------------------------------------------------------
Irving H. Picard, trustee for the liquidation of Bernard L. Madoff
Investments Securities LLC pursuant to the Securities Investor
Protection Act, has engaged Lazard Freres & Co. LLC to assist in
the sale of the trading operations of BLMIS.

The Honorable Louis L. Stanton of the United States District Court
for the Southern District of New York appointed Mr. Picard as
trustee on Dec. 15, 2008.  Lee S. Richards, the previously
appointed Receiver for BLMIS, continues to serve as Receiver for
Madoff Securities International Ltd.

Mr. Picard, who has retained Baker & Hostetler LLP as counsel,
has mailed customer claim packages and other claim information and
to publish notice of the SIPA proceeding beginning January 2.  The
SIPA proceeding is currently pending in the U.S. Bankruptcy Court
for the Southern District of New York.

In a joint statement, Mr. Picard, and Stephen Harbeck, president
of the Securities Investor Protection Corporation said that the
Bankruptcy Court has approved Mr. Picard's request for the
transfer of $29 million in debtor funds held by the Bank of New
York.

"This is one of many steps that Trustee Irving H. Picard has taken
and will continue to take to collect all available assets of
Bernard L. Madoff Investment Securities LLC for the future use of
satisfying customer claims and other purposes," Mr. Picard and
Mr. Harbeck said.

"We want to be very clear that to the extent these and other funds
are 'customer property,' they will be used for satisfying customer
claims and not the administrative expenses of the Trustee.

The joint statement also clarified that contrary to some recent
media accounts, trustee expenses are paid out of any general
estate of the debtor, and if insufficient, through advances by
SIPC.  Customer property may not be used to pay the administrative
expenses of a liquidation proceeding.  Under the Securities
Investor Protection Act, the trustee is empowered to recover
customer property so that it may be returned to customers in need
of protection under that law.  Because expenditures by the trustee
to recover such property and other administrative expenses of the
trustee are borne by the general estate and SIPC and not by
customers, such expenditures diminish in no way the amount of
customer property available for customers.

                            About SIPC

The Securities Investor Protection Corporation is the U.S.
investor's first line of defense in the event a brokerage firm
fails, owing customer cash and securities that are missing from
customer accounts. SIPC either acts as trustee or works with an
independent court-appointed trustee in a brokerage insolvency case
to recover funds.

The statute that created SIPC provides that customers of a failed
brokerage firm receive all non-negotiable securities - such as
stocks or bonds -- that are already registered in their names or
in the process of being registered. At the same time, funds from
the SIPC reserve are available to satisfy the remaining claims of
each customer up to a maximum of $500,000. This figure includes a
maximum of $100,000 on claims for cash. From the time Congress
created it in 1970 through December 2007, SIPC has advanced $507
million in order to make possible the recovery of $15.7 billion in
assets for an estimated 626,000 investors.

                   About Bernard L. Madoff

Bernard L. Madoff Investment Securities LLC was a market maker in
US stocks, including all of the S&P 500 and more than 350 Nasdaq
stocks.  The firm moved large blocks of stock for institutional
clients by splitting up orders or arranging off-exchange
transactions between parties.  It also performed clearing and
settlement services.  Clients included brokerages, banks, and
other financial institutions.  In addition, Madoff Securities
managed assets for high-net-worth individuals, hedge funds, and
other institutional investors.

The firm is being liquidated in the aftermath of a fraud scandal
involving founder Bernard L. Madoff.

As reported by the Troubled Company Reporter on Dec. 15, 2008, the
Securities and Exchange Commission charged Bernard L. Madoff and
his investment firm, Bernard L. Madoff Investment Securities LLC,
with securities fraud for a multi-billion dollar Ponzi scheme that
he perpetrated on advisory clients of his firm.  The estimated
losses from Madoff's fraud were at least $50 billion

Also on Dec. 15, 2008, the Honorable Louis A. Stanton of the U.S.
District Court for the Southern District of New York granted the
application of the Securities Investor Protection Corporation for
a decree adjudicating that the customers of BLMIS are in need of
the protection afforded by the Securities Investor Protection Act
of 1970.  Irving H. Picard, Esq., was appointed as trustee for the
liquidation of BLMIS, and Baker & Hostetler LLP was appointed as
counsel.


BERNARD L. MADOFF: Remains Free on Bail, Violates Asset Freeze
--------------------------------------------------------------
Bloomberg News reports that Bernard Madoff remained free on bail
while a federal judge considered a request by prosecutors to send
him to prison for mailing $1 million of valuables in violation of
an asset freeze.

According to Bloomberg, U.S. Attorney Marc Litt informed the U.S.
District Court for the Southern District of New York, that Mr.
Madoff disposed of five items including "very valuable jewelry."
Defense lawyer Ira Sorkin, according to the report, however, said
the objects, including watches and cuff links, were heirlooms
innocently sent to Mr. Madoff's relatives.

On December 11, 2008, Bernard L. Madoff was arrested on a criminal
complaint alleging one count of securities fraud.  The Securities
and Exchange Commission brought a civil action against Mr. Madoff,
and filed a motion to freeze certain assets and to appoint a
receiver.

On December 12, 2008, U.S. District Judge Louis L. Stanton entered
an order:  (1) appointing a receiver (Lee S. Richards, Esq.) over
Bernard L. Madoff Investment Securities LLC, Madoff Securities
International Ltd., and Madoff Ltd.; and (2) freezing certain
corporate and personal assets.  On December 15, 2008, a trustee,
Irving H. Picard, Esq., was appointed for the liquidation of
Bernard L. Madoff Investment Securities LLC, pursuant to the
Securities Investor Protection Act of 1970.

The SEC's complaint alleges that Mr. Madoff informed two senior
employees that his investment advisory business was a fraud and
that he was running a "giant Ponzi scheme."  Mr. Madoff allegedly
admitted that his firm was insolvent and had been for years, and
that he estimated the losses from this fraud were at least $50
billion.  According to regulatory filings, the Madoff firm had
more than $17 billion in assets under management as of the
beginning of 2008.

                   About Bernard L. Madoff

Bernard L. Madoff Investment Securities LLC was a market maker in
US stocks, including all of the S&P 500 and more than 350 Nasdaq
stocks.  The firm moved large blocks of stock for institutional
clients by splitting up orders or arranging off-exchange
transactions between parties.  It also performed clearing and
settlement services.  Clients included brokerages, banks, and
other financial institutions.  In addition, Madoff Securities
managed assets for high-net-worth individuals, hedge funds, and
other institutional investors.

The firm is being liquidated in the aftermath of a fraud scandal
involving founder Bernard L. Madoff, a a registered investment
adviser, and former Chairman of the NASDAQ Stock Market, has been
charged with securities fraud.

As reported by the Troubled Company Reporter on Dec. 15, 2008, the
Securities and Exchange Commission charged Bernard L. Madoff and
his investment firm, Bernard L. Madoff Investment Securities LLC,
with securities fraud for a multi-billion dollar Ponzi scheme that
he perpetrated on advisory clients of his firm.  The estimated
losses from Madoff's fraud were at least $50 billion

Also on Dec. 15, 2008, the Honorable Louis A. Stanton of the U.S.
District Court for the Southern District of New York granted the
application of the Securities Investor Protection Corporation for
a decree adjudicating that the customers of BLMIS are in need of
the protection afforded by the Securities Investor Protection Act
of 1970.  Irving H. Picard, Esq., was appointed as trustee for the
liquidation of BLMIS, and Baker & Hostetler LLP was appointed as
counsel.


BERNARD L. MADOFF: Trustee Identifies $830-Mil. in Liquid Assets
----------------------------------------------------------------
Irving H. Picard, trustee for the liquidation of Bernard L. Madoff
Investments Securities LLC pursuant to the Securities Investor
Protection Act, has identified $830 million to $850 million in
liquid assets of BLMIS.

SIPC President Stephen Harbeck told a congressional committee Jan.
5 that assets identified by Mr. Picard may be subject to recovery
for customers of the Madoff firm, SIPC President Stephen Harbeck
told a congressional committee today. "The trustee and SIPC will
be aggressive in their pursuit of such recoveries" from the
alleged $50 billion Ponzi scheme, he said.

As reported by the Troubled Company Reporter on Dec. 15, 2008, the
Securities and Exchange Commission charged Bernard L. Madoff and
his investment firm, Bernard L. Madoff Investment Securities LLC,
with securities fraud for a multi-billion dollar Ponzi scheme that
he perpetrated on advisory clients of his firm.

According to Bloomberg's tally of disclosures and press reports,
clients have disclosed about $37 billion in investments to BLMIS.
The clients included banks, hedge funds, charities, universities
and wealthy individuals.

According to The Associated Press, the management of Bank Medici,
a small Austrian merchant bank, has emerged as one of the largest
victims, disclosing that $2.1 billion in client funds had been
invested with Mr. Madoff.  The chief executive, Peter Scheithauer,
who joined the bank only four months ago, and a board member,
Werner Tripolt, resigned effective immediately.  The resignations,
according to the report, made room for a government-appointed
accountant to temporarily take over day-to-day operations.

Meanwhile, U.S. lawmakers, critical of the Securities and Exchange
Commission's failure to timely uncover Bernard Madoff's alleged
$50 billion fraud, demanded the agency speed up an internal
investigation of its missteps to help in their overhaul of market
regulations.  U.S. Senators Christopher Dodd and has sent a letter
to SEC Chairman Christopher Cox seeking information on how federal
regulators supervised and oversaw Madoff's firm.

The SEC will conduct an internal probe on the issue.  According to
Bloomberg, the probe will examine how Madoff's reputation,
developed while on SEC advisory committees, leading Securities
Industry Association panels and serving as chairman of the Nasdaq
Stock Market, "may have affected commission decisions regarding
investigations, examinations and inspections of his firm," SEC
Inspector General H. David Kotz said in testimony prepared for a
congressional meeting Jan. 5.


                   About Bernard L. Madoff

Bernard L. Madoff Investment Securities LLC was a market maker in
US stocks, including all of the S&P 500 and more than 350 Nasdaq
stocks.  The firm moved large blocks of stock for institutional
clients by splitting up orders or arranging off-exchange
transactions between parties.  It also performed clearing and
settlement services.  Clients included brokerages, banks, and
other financial institutions.  In addition, Madoff Securities
managed assets for high-net-worth individuals, hedge funds, and
other institutional investors.

The firm is being liquidated in the aftermath of a fraud scandal
involving founder Bernard L. Madoff, a a registered investment
adviser, and former Chairman of the NASDAQ Stock Market, has been
charged with securities fraud.

As reported by the Troubled Company Reporter on Dec. 15, 2008, the
Securities and Exchange Commission charged Bernard L. Madoff and
his investment firm, Bernard L. Madoff Investment Securities LLC,
with securities fraud for a multi-billion dollar Ponzi scheme that
he perpetrated on advisory clients of his firm.  The estimated
losses from Madoff's fraud were at least $50 billion

Also on Dec. 15, 2008, the Honorable Louis A. Stanton of the U.S.
District Court for the Southern District of New York granted the
application of the Securities Investor Protection Corporation for
a decree adjudicating that the customers of BLMIS are in need of
the protection afforded by the Securities Investor Protection Act
of 1970.  Irving H. Picard, Esq., was appointed as trustee for the
liquidation of BLMIS, and Baker & Hostetler LLP was appointed as
counsel.


BERNARD L. MADOFF: Firms Begin Probing Claims; Court Stays Suits
----------------------------------------------------------------
Various firms have begun investigating claims of clients of
Bernard L. Madoff Investments Securities LLC and other affected
entities.

Clients and other parties, however, will continue to be
temporarily barred from suing over an alleged Ponzi scheme while a
trustee examines Bernard Madoff's books.  According to Bloomberg
News, a 21-day stay granted by U.S. District Judge Louis Stanton
in Manhattan on Dec. 15 prohibited parties from selling or
foreclosing on collateral pledged by Madoff, or enforcing liens
against Madoff.

The Law Firms of Sallah & Cox, LLC, Blum & Silver, LLP and David
R. Chase, P.A. announce that they are collectively investigating
claims of BLMIS investors who invested through a bank, brokerage
firm, investment advisory firm or hedge fund.  The three firms
said that they have spoken with several Madoff investors and are
investigating to determine if any third-party intermediary that
recommended and facilitated investments in BLMIS has legal
liability for purposes of recovering investment losses.

The law offices of McCabe Rabin and Stein, Stein & Pinsky have
been retained by Florida investors to investigate claims against
various third parties in connection with Madoff's alleged Ponzi
scheme. The third parties include Westport National Bank, a
division of Connecticut Community Bank, N.A.  The firms have
learned that investors in Florida and other states were solicited
by a promoter to invest with Westport National Bank in Westport,
Connecticut.

The Securities Law Firm of Tramont Guerra & Nunez, PA (TGN) is
currently investigating the relationships between BLMIS and
numerous investment managers, feeder funds, financial advisors and
financial institutions, who entrusted client funds to be managed
by Madoff, and who may not have performed the required due
diligence of Madoff's investment firm.  These investment conduits
included Fairfield Sentry Fund, Ascot Partners Fund, Tremont
Capital Management, Rye Select Market Fund, Kingate Global Fund
and Access International Advisors.  TGN has focused their
investigation on behalf of individual investors who may have
viable claims that warrant the filing of individual securities
arbitration claims.  TGN said that a class action lawsuit (Case
No. 08 CV 5046) has been filed on December 12, 2008, against
Bernard L. Madoff, individually, and BLMIS and John Does 1-100
consisting of individuals, corporations, partnerships and entities
to be determined.

Keller Rohrback L.L.P. -- http://www.erisafraud.com/-- is
nvestigating the legal options of retirement savings and pension
plans that have been affected by the long-running Ponzi scheme at
BLMIS.  The firm noted that the ongoing investigation by the
Securities and Exchange Commission has revealed that Madoff kept
several sets of books and false documents, and provided false
information involving his advisory activities to investors and to
regulators.

Klueger & Stein, LLP -- http://www.maximumassetprotection.com--
said it has been contacted by investors who received distributions
from BLMIS, and who fear that a Madoff bankruptcy trustee may sue
them to return distributions they received early on in Madoff's
Ponzi scheme.  Founding attorney Robert F. Klueger explained that
a bankruptcy trustee's ability to seize distributions from what
turned out to be a Ponzi scheme is based on the theory of
"fraudulent conveyance," and may nab even those investors who were
innocent victims of Madoff's scheme.  This may impact even those
investors who received distributions years ago.

Another firm, Hagens Berman Sobol Shapiro LLP  --
http://www.hbsslawsecurities.com/tremont-- filed a class-action
lawsuit in a U.S. District Court in New York against Tremont Group
Holdings, its Rye Investment Funds, Oppenheimer Acquisition
Corporation, OppenheimerFunds, which owns Tremont, Massachusetts
Mutual Life Insurance Co., a majority owner of OppenheimerFunds
and KPMG LLP, Tremont's auditor.  The suit filed on behalf of
individuals and groups that invested capital with Tremont, alleges
defendants grossly neglected fiduciary duties by turning capital
over to BLMIS that used the capital to run a massive Ponzi scheme.

                   About Bernard L. Madoff

Bernard L. Madoff Investment Securities LLC was a market maker in
US stocks, including all of the S&P 500 and more than 350 Nasdaq
stocks.  The firm moved large blocks of stock for institutional
clients by splitting up orders or arranging off-exchange
transactions between parties.  It also performed clearing and
settlement services.  Clients included brokerages, banks, and
other financial institutions.  In addition, Madoff Securities
managed assets for high-net-worth individuals, hedge funds, and
other institutional investors.

The firm is being liquidated in the aftermath of a fraud scandal
involving founder Bernard L. Madoff, a a registered investment
adviser, and former Chairman of the NASDAQ Stock Market, has been
charged with securities fraud.

As reported by the Troubled Company Reporter on Dec. 15, 2008, the
Securities and Exchange Commission charged Bernard L. Madoff and
his investment firm, Bernard L. Madoff Investment Securities LLC,
with securities fraud for a multi-billion dollar Ponzi scheme that
he perpetrated on advisory clients of his firm.  The estimated
losses from Madoff's fraud were at least $50 billion

Also on Dec. 15, 2008, the Honorable Louis A. Stanton of the U.S.
District Court for the Southern District of New York granted the
application of the Securities Investor Protection Corporation for
a decree adjudicating that the customers of BLMIS are in need of
the protection afforded by the Securities Investor Protection Act
of 1970.  Irving H. Picard, Esq., was appointed as trustee for the
liquidation of BLMIS, and Baker & Hostetler LLP was appointed as
counsel.


BROADSTRIPE LLC: Files for Bankruptcy; Secures $15MM DIP Facility
-----------------------------------------------------------------
Broadstripe LLC along with its affiliates filed voluntary
petitions for relief under Chapter 11 of the U.S. Bankruptcy Code
in the U.S. Bankruptcy Court for the District of Delaware to give
effect to a financial restructuring on terms agreed between the
company and the requisite majorities of its senior secured lenders
and its second lien secured lenders.

Terms of the pre-packaged plan weren't disclosed, Bloomberg's Bil
Rochelle said.  According to the report, Broadstripe owes $10
million on a secured revolving credit, $171 million on a first-
lien term loan, and $102 million on a second-lien secured credit.

In conjunction with the filing, certain of the company's existing
lenders have agreed to provide the company with up to $15 million
in debtor-in-possession financing.

Gustavo Prilick, Broadstripe's Chief Executive Officer, said,
"[Mon]day's Chapter 11 filing enables Broadstripe to restructure
its debt while we continue operating and supporting our customers.
With the support of our lenders, we believe that we have embarked
on a course of action that will benefit our customers, suppliers,
employees and the communities in which we operate. Our goal is for
Broadstripe to complete its restructuring without disruption to
our customers and to emerge financially stable, highly competitive
and with a promising future."

Mr. Prilick said that the company intends to complete the
restructuring as quickly as possible.  "In the meantime, we will
remain focused on delivering top quality video, voice and data
services for customers and on supporting the Broadstripe employees
who provide these services," he said.  Mr. Prilick noted that the
company intends to continue to upgrade its networks and to
introduce new and enhanced products for its customers.

The company said that the filing allows it to operate in the
normal fashion under court protection while it reorganizes.

The company said it engaged business advisory firm, FTI Consulting
Inc., as its turnaround manager.  The company has named Stephen
Dube, a senior managing director of the firm, as its chief
restructuring officer.  The company's bankruptcy counsel are
Gardere Wynne Sewell LLP of Houston, Texas and Ashby & Geddes of
Wilmington, Delaware.

Speaking about the agreement on restructuring terms with the
secured lender groups and the commitment for debtor-in-possession
financing, Mr. Dube said, "We are very pleased to have already
achieved this significant progress on our restructuring and to
have the financial support of a group of our existing lenders
during the reorganization process.  This demonstrates their
belief, shared by the Company, in the value of Broadstripe."  He
noted that, upon Court approval, the debtor-in-possession
financing should be more than sufficient to finance the Company's
operations through the Chapter 11 process.

The company said that it intends to complete its restructuring as
quickly as possible and expects this to be accomplished in 2009.

Headquartered Chesterfield, Missouri, Broadstripe LLC --
http://www.broadstripe.com-- provides video and telephone
services to consumers and business in Maryland, Michigan,
Washington and Oregon.


CENTENNIAL COMMS: No Exact Date Yet on Shareholders Meeting
-----------------------------------------------------------
Centennial Communications Corp. will hold a special meeting of
stockholders at a yet to be determined date to:

   1. consider and vote upon a proposal to adopt the Agreement
      and Plan of Merger, dated as of November 7, 2008, as
      amended from time to time, by and among the Company, AT&T
      Inc., and Independence Merger Sub Inc., a direct wholly
      owned subsidiary of AT&T.

   2. approve the adjournment of the special meeting, if
      necessary or appropriate, to solicit additional proxies
      if there are insufficient votes at the time of the
      special meeting to adopt the Merger Agreement.

The Troubled Company Reporter said November 26, 2008, that AT&T
Inc. has acquired 19,122,000 shares, or about 17.7%, of Centennial
Communications common stock.  AT&T said the shares are held
pursuant to a Voting Agreement, dated as of Nov. 7, 2008, with
Welsh, Carson, Anderson & Stowe VIII L.P., Centennial's largest
shareholder, and Centennial, obligating Welsh Carson to vote the
shares in accordance with the terms of the Voting Agreement.

The Merger Agreement provides, among other things, for the merger
of the Merger Sub with and into Centennial with Centennial
surviving as a wholly owned subsidiary of AT&T.  Each share of
Centennial Common Stock issued and outstanding immediately prior
to the Effective Time will be converted into and will thereafter
represent the right to receive $8.50 in cash, without interest.
The Centennial shares will be de-listed from the Nasdaq Global
Select Exchange and de-registered under the Securities Exchange
Act of 1934, as amended, as soon as practicable.

Consummation of the Merger is subject to the satisfaction or
waiver of certain conditions, including, but not limited to, (i)
approval of the Merger Agreement by the holders of shares of
Centennial Common Stock, (ii) conditions related to regulatory
approval and (iii) other customary closing conditions.

A full-text copy of the Agreement and Plan of Merger, dated as of
November 7, 2008, among AT&T Inc., Independence Merger Sub Inc.
and Centennial Communications Corp. is available at no charge at:

              http://ResearchArchives.com/t/s?3535

A full-text copy of the Voting Agreement, dated as of November 7,
2008, between AT&T Inc., Centennial Communications Corp. and
Welsh, Carson, Anderson & Stowe VIII L.P. is available at no
charge at:

              http://ResearchArchives.com/t/s?3536

                            About AT&T

AT&T Inc. is a premier communications holding company.  Its
subsidiaries and affiliates, AT&T operating companies, are the
providers of AT&T services in the United States and around the
world.  Among their offerings are the world's most advanced
Internet protocol-based business communications services and the
nation's leading wireless, high speed Internet access and voice
services.  In domestic markets, AT&T is known for the directory
publishing and advertising sales leadership of its Yellow Pages
and YELLOWPAGES.COM organizations, and the AT&T brand is licensed
to innovators in such fields as communications equipment.

                About Centennial Communications

Based in Wall, New Jersey, Centennial Communications Corp.
(Nasdaq: CYCL) - http://www.centennialwireless.com/--
provides regional wireless and integrated communications
services in the United States and the Puerto Rico with
approximately 1.1 million wireless subscribers and 582,200 access
lines and equivalents.  The US business owns and operates wireless
networks in the Midwest and Southeast covering parts of six
states.  Centennial's Puerto Rico business owns and operates
wireless networks in Puerto Rico and the U.S. Virgin Islands and
provides facilities-based integrated voice, data and Internet
solutions.  Welsh, Carson, Anderson & Stowe is a significant
shareholder of Centennial.

                          *     *     *

As reported by the Troubled company Reporter on Nov. 13, 2008,
Fitch Ratings has placed the ratings for Centennial Communications
Corp. -- IDR 'B'; and Senior unsecured notes 'CCC+/RR6' -- and
Centennial Cellular Operating Co. -- IDR 'B'; Senior secured
credit facility to 'BB/RR1'; Senior unsecured notes to 'BB/RR1' --
on Rating Watch Positive.

On November 12, TCR said Standard & Poor's Ratings Services placed
selected ratings on Centennial on CreditWatch with positive
implications, including the 'B' corporate credit rating and issue
ratings on all unsecured debt, but excluding the 'BB-' rating on
subsidiary Centennial Cellular Operating Co. LLC's credit
facility.  S&P said the CreditWatch excludes Centennial's secured
bank facility since it contains mandatory change of control
provisions which will be triggered at closing and therefore
require repayment at that time.  Centennial has about $1.9 billion
in outstanding debt, of which about $1.4 billion are affected by
the CreditWatch action.

Moody's Investors Service placed the debt of Centennial --
Corporate Family Rating, currently B2; and Senior Unsecured
Regular Bond/Debenture, currently Caa1 -- and Centennial
Communications -- Senior Secured Bank Credit Facility, currently
Ba2; and Senior Unsecured Regular Bond/Debenture, currently B2 --
on review for possible upgrade.


CESARE VAUGHAN: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Cesare M. Vaughan
        2027 Madison Avenue
        Baltimore, MD 21217

Bankruptcy Case No.: 08-27215

Chapter 11 Petition Date: December 24, 2008

Court: United States Bankruptcy Court
       District of Maryland (Baltimore)

Judge: Judge Nancy V. Alquist

Debtor's Counsel: Richard B. Rosenblatt, Esq.
                  The Law Offices of Richard B. Rosenblatt
                  30 Courthouse Square, Suite 302
                  Rockville, MD 20850
                  Tel.: (301) 838-0098
                  Email: rrosenblatt@rosenblattlaw.com

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

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

A full-text copy of the Debtor's petition and a list of the
Debtor's largest unsecured creditors are available for free at:

        http://bankrupt.com/misc/mdb08-27215.pdf

The petition was signed by Cesare M. Vaughan.


CHRYSLER LLC: U.S. Sales Drop 53% in December 2008 From 2007
------------------------------------------------------------
Chrysler LLC reported total December 2008 U.S. sales of 89,813
units, up five percent versus November 2008 (85,260 units), and
down 53 percent from the same month in 2007.  For the year,
Chrysler, Jeep(R) and Dodge U.S. sales decreased 30 percent
(1,453,122 units) compared to total 2007 sales (2,076,650 units).
Total sales were significantly affected by the industry's largest
reductions in fleet sales, 63 percent for December and 31 percent
for the year.

According to Bloomberg News, U.S. auto sales plunged 36% in
December, dragging the industry's annual volume to a 16-year low
as the recession ravaged demand.

"Last year Chrysler and all of our stakeholders persevered through
extraordinarily difficult economic conditions, made the necessary
adjustments and always kept our focus on serving our customers,"
said Jim Press, President and Vice Chairman, Chrysler LLC.  "As a
result, our Company and our dealer network start this year
stronger and better positioned to succeed in today's marketplace."

"From a customer perspective, we see consumers selecting vehicles
based on their long-term transportation needs and committing to
keeping vehicles for longer periods.  As a result, characteristics
such as utility, flexibility, efficiency and quality will grow in
importance.  In terms of product focus, Chrysler will continue to
invest in quality and fuel efficiency improvements on its current
lineup, while developing all-new vehicles for the next generation.
From an organizational viewpoint, we will work with all of our
stakeholders to continue the restructuring our company.  We have a
special bond with the American people now and pledge to continue
our efforts to provide the best quality and best value in the
marketplace. We are committed to help drive America forward."

December Sales Highlights

   -- All Jeep brand vehicles achieved sales growth over November
      2008 sales.  Jeep Wrangler, the brand's top-selling model,
      marked sales growth of 15 percent (7,048 units) over
      November.

  -- Sales of the Jeep Patriot were up six percent in December
     (2,597 units) compared to November 2008.  Year-to-date,
     Patriot sales grew 38 percent to reach 55,654 units.

  -- Minivan sales gained momentum over November.  Chrysler Town
     and Country sales in December grew nine percent (8,152
     units) and Dodge Grand Caravan sales increased 14 percent
     (6,927 units).

  -- Dodge Ram light duty pickup sales were up 10 percent (10,601
     units) compared to November 2008, fueled by the availability
     of the all-new 2009 Dodge Ram.

  -- The Company finished the month with 397,569 units of
     inventory, or a 115-day supply. Inventory is down nine
     percent compared with December 2007, when it totaled 438,390
     units.

January Incentives

Chrysler continues to offer customers highly competitive discount
and financing programs to kick off 2009.  In addition to offering
discounts of up to $6,000 on 2008 MY vehicles and up to $3,000 on
2009 MY vehicles to all customers, the Company is also working
with Chrysler Financial and additional financing companies around
the country to create packages that offer customers a wide range
of options for lease and purchase financing.  On select 2008
models, 0% financing is available for 72 months, and rates as low
as 1.9% APR are available on select 2009 models.

For the new year, Chrysler has entered into a partnership with
Credit Unions across the nation to offer an additional $500 to
$1,000 discount when any of the 90 million members of Credit
Unions purchase or lease a new Chrysler, Jeep or Dodge vehicle.
This program was successfully piloted in December in 12 states.

                     About Chrysler LLC

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

                         *     *     *

As reported in the Troubled Company Reporter on Dec. 3, 2008,
Dominion Bond Rating Service downgraded the ratings of Chrysler
LLC, including Chrysler's Issuer Rating to CC from CCC (high).
Chrysler's First Lien Secured Credit Facility and Second Lien
Secured Credit Facility have also been downgraded to CCC and CC
(low) respectively.  All trends are Negative.  The ratings action
reflects Chrysler's challenge to maintain sufficient liquidity
balances amid severe industry conditions that have deteriorated
alarmingly over the past few months and are not expected to
improve in the near term.  With this ratings action, Chrysler is
removed from Under Review with Negative Implications, where it was
placed on Nov. 7, 2008.

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

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

As reported in the TCR on Dec. 3, 2008, Dominion Bond Rating
Service downgraded on Nov. 20, 2008, the ratings of Chrysler LLC,
including Chrysler's Issuer Rating to CC from CCC (high).
Chrysler's First Lien Secured Credit Facility and Second Lien
Secured Credit Facility have also been downgraded to CCC and CC
(low) respectively.  All trends are Negative.  The ratings action
reflects Chrysler's challenge to maintain sufficient liquidity
balances amid severe industry conditions that have deteriorated
alarmingly over the past few months and are not expected to
improve in the near term.  With this ratings action, Chrysler is
removed from Under Review with Negative Implications, where it was
placed on Nov. 7, 2008.


CONSECO INC: Increased Financial Pressure Cues Fitch Cut
--------------------------------------------------------
Fitch Ratings has downgraded the ratings assigned to Conseco Inc.
The Rating Outlook on Conseco Inc. and its subsidiaries remains
Negative. In addition, the Insurer Financial Strength (IFS) rating
for Senior Health Insurance Company of Pennsylvania (SHICP) is
withdrawn following Conseco's spin-off of that company.

The downgrade widens the notching between the debt ratings at the
holding company and the IFS ratings at the insurance subsidiaries.
This reflects the company's decreased financial flexibility due
to:

   -- Higher financial leverage;
   -- Approximately $88 million in 2009 debt maturities;
   -- Reduced cushion in its secured bank facility financial
      covenants.

The covenants of immediate concern are those related to statutory
capital, risk-based capital ratios, and leverage, which are
expected to end the year 2008 significantly closer to covenant
levels.  Conseco's anticipated position versus these covenants was
affected by the SHICP spin-off transaction and impairments in its
investment portfolio.  Fitch believes that while the spin-off of
SHICP had a positive impact on Conseco's insurance risk profile,
it also weakened the financial profile of the holding company.

Fitch continues to maintain a Negative Outlook on the holding
company and its insurance subsidiaries reflecting the current
challenging investment environment.  Fitch believes Conseco's
statutory capital will be pressured by impairments in the
deteriorating market for commercial mortgage backed securities and
commercial mortgages.  Fitch also notes Conseco's exposure to a
sizable but highly rated Alt-A residential mortgage-backed
security portfolio and below-investment-grade fixed maturity
corporate securities that are greater than 100% of statutory
capital. The company has a meaningful exposure to GAAP unrealized
losses on its investment portfolio that under statutory accounting
rules are not reflected in capital.

In addition to investment results, the future of Conseco's ratings
and Outlook will be based on the company's ability to improve its
financial profile. Fitch notes that the company is currently
working on various initiatives to improve statutory capital. Fitch
also expects continuation of the progress the company has made in
improving operating performance in its business lines.

Fitch downgrades these with a Negative Outlook:

Conseco, Inc.

   -- Issuer default rating to 'BB-' from 'BB';
   -- Senior secured bank credit facility to 'BB-' from 'BB+';
   -- Senior unsecured debt to 'B' from 'BB-'.

This rating is withdrawn:

Senior Health Insurance Company of Pennsylvania

   -- IFS rating of 'CCC+'.

These ratings are unchanged, with a Negative Outlook:

Bankers Life and Casualty Company

   -- IFS rating 'BBB'.

Conseco Life Insurance Company
Bankers Conseco Life Insurance Company
Conseco Insurance Company
Conseco Health Insurance Company
Colonial Penn Life Insurance Company
Washington National Insurance Company

   -- IFS rating 'BBB-'.


COUNT ME IN: May Sell Assets to Pay $5 Million to Creditors
-----------------------------------------------------------
Chief executive officer of Count Me In Corporation, Terry Drayton,
said that the organization is continuing its work to secure
investors or a sale so the company can repay the $5 million it
owes to 220 sports organizations across the country.

"My only objective is to raise the funds needed to pay back every
club we owe money -- every penny," Mr. Drayton said.  The company
is in active negotiations with a number of organizations that
could either provide a capital injection, or purchase the company
outright, Mr. Drayton added.

"CMI made a series of errors over the past eight years, largely
around having the right staff and developing the appropriate
procedures, adequate systems and financial oversight in place,"
Mr. Drayton said.  "We could talk about that, or poor advice we
received, but at the end of the day, I am now in charge, so it is
my responsibility to fix the problem."

According to Mr. Drayton, the company can fully account for every
penny of the $5 million shortfall, noting the funds were slowly
used over the past eight years to pay normal operating costs for
the Bellevue company, such as salaries for its software engineers
and support staff.

Mr. Drayton noted that over the past eight years the company has
collected about $175 million for its clients and distributed
$170 million, about 97% to them.  "It's a series of small
oversights over a long period of time that got us here," he added,
"nothing more."  When Mr. Drayton became aware of the problem
about two years ago, he brought in outside financial experts to
help understand the extent of the financial issues.

Mr. Drayton said he also instituted new procedures and upgraded
accounting and remittance systems.  "We had to do a ton of things
including re-keying almost seven years worth of financial records
before we could understand the extent of our financial situation,"
he added.  "We got that done in May 2008, and I then stepped in
full-time to try to fix the shortfall through a planned $10M
equity offering."

Late last year, CMI voluntarily changed its business model and no
longer handles money on behalf of its clients.  Instead funds flow
directly to the clubs so they are always under the clubs' compete
financial control.  "With 20/20 hindsight I wish we'd done that
from the outset," said Mr. Drayton.  Mr. Drayton acknowledged that
some of CMI's clients have grown understandably impatient waiting
for him to secure an investor.  "A couple of clubs have filed
lawsuits but many more are just asking their members to contact
their credit card company to reverse the charges and mail them a
check," he said.  "Our support team will continue to assist our
clients if they make the decision to pursue charge-backs."

Mr. Drayton also noted that a recent court filing by three Alaska
based sports clubs attempting to force the company into
involuntary bankruptcy could have a devastating effect on all the
clubs CMI owes money.  "If they are successful and force us into
Chapter 7 liquidation, our clients will get pennies on the
dollar," Mr. Drayton said.  "We want to make sure our customers
are 100 percent, fully repaid, and that won't happen in bankruptcy
court.  That's why we haven't pursued that option."

Mr. Drayton added that he plans to ask the clubs filing the court
action to withdraw their claim.  "I can understand our clients'
frustration and anger. We made a host of mistakes and have put
them in a difficult situation.  Now I'm just asking them for the
time to fix it," he concluded.

Headquartered in Bellevue, Washington, Count Me In Corporation --
http://www.countmein.com/-- provides online registration and
league management software for league administrators.


COVER-ALL INC: Case Summary & 19 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Cover-All, Inc.
        8964 Oso Avenue
        Chatsworth, CA 91311

Bankruptcy Case No.: 09-10011

Type of Business: The Debtor offers flooring installation
                  refinishing contracting services.
                  See: http://www.coverallflooring.com

Chapter 11 Petition Date: January 2, 2009

Court: Central District Of California (San Fernando Valley)

Judge: Kathleen Thompson

Debtor's Counsel: Michael Jay Berger, Esq.
                  mikeberger@aol.com
                  Law Offices of Michael Jay Berger
                  9454 Wilshire Blvd., 6th Flr.
                  Beverly Hills, CA 90212-2929
                  Tel: (310) 271-6223
                  Fax: (310) 271-9805

Estimated Assets: $1 million to $10 million

Estimated Debts: $10 million to $50 million

The Debtor's Largest Unsecured Creditors:

   Entity                      Nature of Claim   Claim Amount
   ------                      ---------------   ------------
Bank of the West               loan; secured:    $9,900,000
1977 Saturn St.                $1,000,000
Monterey Park, CA 91755
Tel: (888) 727-2692

Internal Revenue Service       tax               $6,965,887
330 North Brand Blvd #600
Glendale, CA 91203
Tel: (818) 637-3925

Masco                          investor          $5,854,539
21001 Van Born Road
Taylor, MI 48180
Tel: (313) 792-6284

State Compensation             settlement        $5,344,988
Insurance Fund
c/o Jim Burgess, Sheppard
Mullin
1901 Ave. of the Stars
Suite 1600
Los Angeles, CA 90067
Tel: (310) 228-3700

Foamex Industries              inventory         $1,143,213
POB 894293
Los Angeles, CA 90189
Tel: (610) 744-2328

Leggett & Platt                inventory         $984,918
1 Leggett Road
Carthage, MO 64836
Tel: (417) 358-8131

American Express Corporate     credit card       $940,442
Card
PO Box 297879
Fort Lauderdale, FL 33329-
7879
Tel: (800) 745-9292


Beaulieu Residential           inventory         $387,541

Miri Leshem Trust              rent              $226,855

Bank of America Visa           credit card       $201,852

Mohawk Industries              inventory         $201,094

Anthem Blue Cross              insurance         $73,454

Array Systems                  consulting Svcs.  $72,625

Steckbauer Weinhart Jaffe LLP  legal             $72,540

Moore Stephens Wurth Frazer    accounting fees   $62,966

Gemini Insurance Company       insurance         $52,781

Waste Management               trash disposal    $39,051

Safeco Insurance               insurance         $31,684

Law Offices of Salkin Rettig   legal fees        $30,210
Tosche

The petition was signed by president Gadi Leshem.


CYRUS REINSURANCE: S&P Withdraws 'BB+' Senior Secured Loan Rating
-----------------------------------------------------------------
Standard & Poor's Ratings Services said that it withdrew its 'BB+'
senior secured, 'B' senior subordinated secured, and 'B-' junior
subordinated secured bank loan ratings on three loans that Cyrus
Reinsurance II Ltd. has prepaid in full.

Cyrus Reinsurance II has no other outstanding obligations.  It is
Standard & Poor's policy to withdraw its ratings on any securities
that an issuer pays in full.


DOUBLE JJ: Court Okays Lease Agreement with AEG Live
----------------------------------------------------
The Muskegon Chronicle reports that the Hon. Scott W. Dales of the
U.S. Bankruptcy Court for the Western District of Michigan has
approved a lease agreement between Thomas A. Bruinsma -- the
bankruptcy trustee for Double JJ Ranch Resort -- and AEG Live.

WZZM relates that organizers of the Rothbury Music Festival want
to hold the concert for the second time at Double JJ.  The report
says that about 40,000 people attended the event at Double JJ last
year.

According to WZZM and The Muskegon Chronicle, a court hearing will
be held on Thursday in Grand Rapids to determine if the agreement
is valid.  Once legal obstacles are resolved, festival promoters
will discuss the 2009 concert, tentatively scheduled for the
Fourth of July, The Muskegon Chronicle says.

WZZM relates that for the agreement to stand, the trustee must
purchase land that used to belong to The Great Lakes Energy
Cooperative, now on a sheriff's deed.  According to the report,
the attorney for owner Bob Lipsitz said that another possible
buyer for the resort has stepped forward.

                         About Double JJ

Double JJ Resort Ranch operates a resort in Rothbury, Michigan.
The Debtor filed for Chapter 11 bankruptcy on July 18, 2008
(Bankr. W.D. Mich. 08-06296).  Steven L. Rayman, Esq., at Rayman &
Stone, and Michael S. McElwee, Esq., at Varnum, Riddering, Schmidt
& Howlett, LLP, represents the Debtor as counsel.  When the Debtor
filed for protection from its creditors, it listed $0 to $50,000
in total assets, and $0 to $50,000 in total debts.


ECLIPSE AVIATION: To Seek Approval of Sale of Biz Jan. 16
---------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware has
scheduled a hearing on Jan. 16, 2009, to consider the approval of
the sale of substantially all of Eclipse Aviation Corp., and
Eclipse IRB Sunport, LLC's assets, free and clear of all claims,
liens, or encumbrances.  Objections, if any, to the relief
requested in the Sale Motion must be filed with the Court so as to
be received no later than 12:00 p.m. prevailing Eastern Time on
Jan. 15, 2009.

If the Successful Bidder fails to consummate an approved Sale, the
next highest or otherwise best Qualified Bid, as approved at the
Sale Hearing, shall be deemed to be the Successful Bid and the
Debtors shall be authorized to effect such Sale without further
order of the Court.

At the Auction, which has been scheduled for Jan. 14, 2009,
Qualified Bidders will be permitted to increase their bids.  The
bidding at the Auction shall start at the purchase price stated in
the highest or otherwise Qualified Bid to be disclosed to all
qualified Bidders prior to commencement of the Auction, and
subject to the provisions of the Bid Procedures Order with respect
to Lot Bidders, continue in increments of at least $1,000,000.

As reported in the Troubled Company Reporter on Jan. 2, 2009, The
Associated Press reported that the deadline for bids for
Eclipse Aviation Corp. is on Jan. 13, 2009.

The AP related that the auction is part of a restructuring
plan Eclipse Aviation proposed after filing for Chapter 11
bankruptcy protection.

The AP stated that an ETIRC Aviation affiliate, Eclipse Aviation's
largest shareholder, wants to purchase Eclipse Aviation for $198
million.

                      About Eclipse Aviation

Albuquerque, New Mexico-based Eclipse Aviation Corporation --
http://www.eclipseaviation.com/-- makes six-passenger planes
powered by two Pratt & Whitney turbofan engines.  The company and
Eclipse IRB Sunport, LLC filed separate petitions for Chapter 11
relief on Nov. 25, 2008 (Bankr. D. Delaware Lead Case No.
08-13031).  Daniel Guyder, Esq., John Kibler, Esq., and David C.
Frauman, Esq., at Allen & Overy LLP, represent the Debtors as
counsel.  Joseph M. Barry, Esq., and Donald J. Bowman, Esq., at
Young Conaway Stargatt & Taylor, LLP, represent the Debtors as
Delaware counsel.  Eclipse Aviation Corporation listed assets of
between $100 million and $500 million and debts of more than
$1 billion.


EDDIE WIGGINS: Reopens After Filing for Chapter 11 Protection
-------------------------------------------------------------
13WMAZ reports that Eddie Wiggins has reopened for business after
filing for Chapter 11 bankruptcy protection.

13WMAZ quoted Nick Camarota, a car salesman at Eddie Wiggins'
dealership, as saying, "We're trying to sell something today
[Friday].  Sell a few cars."  The report says that Mr. Wiggins'
work force was cut to 15 from 47.  According to the report,
Mr. Wiggins said, "Gas went crazy, the economy went in the tank.
Whoever dreamed GM would get in trouble, this kind of trouble.
Whoever dreamed they'd do their dealers this way?"

Mr. Wiggins, 13WMAZ relates, said that GM owes him about $140,000
in rebates.  "Why would they withhold dealers money?  They got to
keep dealers in business," 13WMAZ quoted Mr. Wiggins as saying.
Mr. Wiggins said that without the money, he can't pay the bills,
according to the report.  Court documents say that Mr. Wiggins
owes 20 creditors about $145,000, which 13WMAZ says includes
several parts and service dealers.  13WMAZ states that Mr. Wiggins
owes about $26,000 to the Macon Telegraph for advertising and
$17,000 to 13WMAZ.

Mr. Wiggins, 13WMAZ reports, said that he needs $340,000 to pay
off creditors and balance his books.

Eddie Wiggins -- http://www.eddiewiggins.com-- is a car dealer
based in Warner Robins, Georgia.

As reported by the Troubled Company Reporter on Jan. 5, 2009,
Eddie Wiggins said that he filed for Chapter 11 bankruptcy
protection.


ELLIOTT DONALD: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Donald H. Elliott

Bankruptcy Case No.: 08-20193

Chapter 11 Petition Date: December 24, 2008

Court: United States Bankruptcy Court
       Western District of North Carolina (Bryson City)

Judge: Judge George R. Hodges

Debtor's Counsel: H. Trade Elkins, Esq.
                  Elkins and Elkins
                  228 6th Avenue East
                  Suite 1B
                  Hendersonville, NC 28792
                  Tel.: (828) 692-2205
                  Fax : 828.692.8469
                  Email: htelkins@prodigy.net

Estimated Assets: $1,000,001

Estimated Debts: $10,000,000

A full-text copy of the Debtor's petition and a list of the
Debtor's largest unsecured creditors are available for free at:

        http://bankrupt.com/misc/ncwb08-20193.pdf

The petition was signed by Donald H. Elliott.


E*TRADE FINANCIAL: Regulator Imposes $1MM Fine Against Firm
-----------------------------------------------------------
The Financial Industry Regulatory Authority (FINRA) has imposed a
$1 million fine against E*Trade Financial Corp.'s E*Trade
Securities, LLC, and E*Trade Clearing, LLC, for failing to
establish and implement anti-money laundering (AML) policies and
procedures that could reasonably be expected to detect and cause
the reporting of suspicious securities transactions.

"Brokerage firms' AML programs must be tailored to their business
models," said Susan L. Merrill, Executive Vice President and Chief
of Enforcement.  "In this case, while E*Trade provides its
customers with on-line, self-directed electronic access to the
securities markets, its AML program lacked automated electronic
systems specifically designed to detect potentially manipulative
trading activity in customer accounts."

FINRA requires brokerage firms to establish and implement AML
procedures that address a number of areas, including monitoring
the trading in customer accounts as well as the flow of money into
and out of these accounts.  Firms are required to monitor trading
in customers' accounts for certain types of suspicious trading
activity and file with Department of Treasury's Financial Crimes
Enforcement Network (FinCEN) "a report of any suspicious
transaction relevant to a possible violation of law or
regulation."

FINRA has further instructed each broker/dealer that its AML
program must be tailored to its business.  A firm needs to
consider factors such as its size, location, business activities,
the types of accounts it maintains and the types of transactions
in which its customers engage.  One of the factors that brokerage
firms are instructed to consider generally is the technological
environment in which the firm operates.  On-line firms such as
E*Trade specifically have been instructed to "consider conducting
computerized surveillance of account activity to detect suspicious
transactions and activity."

FINRA found that between Jan.1, 2003, and May 31, 2007, E*Trade
did not have an adequate AML program based upon its business
model.  Because E*Trade did not have separate and distinct
monitoring procedures for suspicious trading activity in the
absence of money movement, its AML policies and procedures could
not reasonably be expected to detect and cause the reporting of
suspicious securities transactions.  The firm relied on its
analysts and other employees to manually monitor for and detect
suspicious trading activity without providing them with sufficient
automated tools.  FINRA determined that this approach to
suspicious activity detection was unreasonable given E*Trade's
business model.

In concluding this settlement, E*Trade neither admitted nor denied
the charges, but consented to the entry of FINRA's findings.

                          About FINRA

FINRA, the Financial Industry Regulatory Authority --
http://www.finra.org-- is the largest non-governmental regulator
for all securities firms doing business in the United States.
FINRA is dedicated to investor protection and market integrity
through effective and efficient regulation and complementary
compliance and technology-based services.  FINRA touches virtually
every aspect of the securities business-from registering and
educating all industry participants to examining securities firms;
writing and enforcing rules and the federal securities laws;
informing and educating the investing public; providing trade
reporting and other industry utilities; and administering the
largest dispute resolution forum for investors and registered
firms.

                    About E*Trade Financial

E*Trade Financial Corp. -- https://www.etrade.com/ -- is a
global financial services company, offering a range of financial
solutions to customers under the brand E*TRADE FINANCIAL.  Its
financial solutions include a suite of trading, investing,
banking and lending products.  Its primary retail products and
services consist of trading and investing, banking and lending
products.  Trading and investing includes automated order
placement and execution of United States and international
equities, currencies, futures, options, exchange-traded funds,
mutual funds and bonds.  Banking includes checking, savings,
sweep, money market and certificates of deposit products that
offer online bill pay, quick transfer, unlimited automated
teller machines transactions on eligible accounts and wireless
account access.  Lending includes mortgage, home equity, margin
and credit card products that offer online loan status and quick
transfer.  The company's primary institutional product is market
making.

As reported by the Troubled Company Reporter on Dec. 26, 2008,
Standard & Poor's Ratings Services said that its 'B' long-term
counterparty credit rating on E*TRADE Financial Corp. and its
'BB-' long-term counterparty credit rating on E*TRADE Bank, which
had been on CreditWatch Negative since Nov. 13, 2007, were placed
on CreditWatch with developing implications pending the outcome of
the company's application to the U.S. Treasury's Troubled Asset
Relief Program and a review of the overall health of the
franchise.

As reported by the TCR on Nov. 10, 2008, Moody's Investors Service
lowered E*TRADE Financial Corporation's long-term senior debt
rating to B2 from Ba3, and also lowered the long-term deposit
rating of its lead thrift subsidiary, E*TRADE Bank, to Ba3 from
Ba2.  E*TRADE Bank's short term deposit rating and rating on other
short-term senior obligations were affirmed at
Not Prime, and the thrift's Bank Financial Strength Rating (BFSR)
was downgraded to D- from D.  The outlook for all long-term
ratings at E*TRADE and E*TRADE Bank, including the BFSR, remains
negative.


FLAGSTAR BANK: Moody's Confirms 'D+' Financial Strength Rating
--------------------------------------------------------------
Moody's Investors Service confirmed the ratings of Flagstar Bank,
FSB.  Flagstar is rated D+ for bank financial strength and
Ba1/Not-Prime for deposits.  The holding company, Flagstar
Bancorp, Inc., is unrated.  The outlook on Flagstar is negative.
This rating action concludes the review for possible downgrade
that began in November 2008.

The confirmation reflects the pending substantial increase in
Flagstar's capital base as a result of two recent announcements.
First, Flagstar has received preliminary approval from the U.S.
Treasury to participate in the Capital Purchase Program.  Under
this program, Flagstar is eligible to sell up to $266 million of
preferred stock and related common stock warrants to the Treasury.
Second, Flagstar has entered into a definitive agreement with a
private equity firm, MP Thrift Investments L.P. (MatlinPatterson),
to sell $250 million of convertible participating voting preferred
stock.  The final approval from the Treasury is subject to receipt
by Flagstar of at least $250 million in proceeds from the sale of
preferred stock to MatlinPatterson.

In Moody's opinion, Flagstar's improved capital base should be
sufficient to absorb expected near-term deterioration in asset
quality, stemming principally from Flagstar's residential mortgage
and commercial real estate portfolios.  Nonetheless, the negative
outlook reflects the challenges associated with Flagstar's
national mortgage banking franchise in the current economic
environment, as well as the company's Michigan commercial real
estate concentration.  Moody's expects Flagstar's asset quality
challenges to result in continued heightened credit costs, which
could lead to operating losses in future periods.  Weak operating
performance could also impact Flagstar's ability to diversify its
funding structure, which is currently dependent on FHLB advances
and CDs.

Flagstar Bancorp, Inc., headquartered in Troy, Michigan, reported
total assets of $14.2 billion at September 30, 2008.

The last rating action was on November 14, 2008 when the long- and
short-tem deposit ratings of Flagstar Bank, FSB were downgraded to
Ba1/Not-Prime from Baa3/Prime-3, and the long-term deposit and
bank financial strength ratings were placed under review for
possible downgrade.

Outlook Actions:

Issuer: Flagstar Bank, FSB

  -- Outlook, Changed To Negative From Rating Under Review

Confirmations:

Issuer: Flagstar Bank, FSB

  -- Bank Financial Strength Rating, Confirmed at D+
  -- Issuer Rating, Confirmed at Ba1
  -- OSO Senior Unsecured OSO Rating, Confirmed at Ba1
  -- Senior Unsecured Deposit Rating, Confirmed at Ba1


FORD MOTOR: Auto Sales Drop More Than 30% in December 2008
----------------------------------------------------------
Mike Barris at The Wall Street Journal reports that Ford Motor Co.
reported that its sales dropped more than 30% in December 2008.

The first quarter will be "bad, no matter how you look at it" and
the loan from the government will be help auto sale recover in the
second half of 2009, WSJ relates, citing Ford Motor senior
economist Emily Kolinski Morris.

Ford Motor's sales figures in December 2008 reflected the housing
market, the economy and the jobless rate.  Ford Motor sales
analyst George Pipas said that the sales rate in December was
similar to what we saw in October and November.

"During these three months, the total vehicle sales rate including
medium and heavy trucks is about 10.6 or 10.7 million and the
light vehicle sales rate is probably in 10.3 or 10.4 and that is
the lowest sales rate for the fourth quarter since 1981, so that
gives you some indication the kind of conditions we are facing now
as well as probably what we can expect to see as we begin 2009 at
least in the first quarter," said Ford Motor.

According to Bloomberg, U.S. auto sales plunged 36 percent in
December, dragging the industry's annual volume to a 16-year low
as the recession ravaged demand.

              F-Series Brings Ford Higher Market Share

New vehicles, including the all-new F-150 truck, and fuel-
efficient powertrains are winning over customers for Ford Motor,
Lincoln and Mercury, which realized market share increases for a
third consecutive month in December.  Ford Motor estimates its
market share was 14.6% in December, up 0.7 of a point versus a
year ago.  This marks the first time since 1997 Ford Motor has
achieved a market share increase three months in a row.

"This is a strong ending to end a very challenging year," said Jim
Farley, Ford Motor's group vice president, Marketing and
Communications.  "In addition to finishing the year with increased
market share, we received several accolades from third parties
concerning our world-class quality and safety, and we turned some
heads on the fuel economy front with our 41 mpg Fusion Hybrid, the
most fuel-efficient mid-size sedan in America."

The F-Series truck played a key role in Ford Motor's fourth
quarter market share gains.  The all-new F-150 accounted for 8,600
of total F-Series sales in December, an increase of 84% compared
with November 2008.  For the year, F-Series sales totaled 515,513.

"Our thanks go out to our customers, our dealers and, of course,
the Ford employees and supplier partners who design, engineer and
manufacture quality, fuel-efficient trucks delivering unmatched
capability," Mr. Farley said.  "The all-new F-150 affirms what
Ford has known for years -- that listening to customers provides
the best rewards."

The all-new F-150 recently was named 2009 Motor Trend Truck of the
Year, a finalist for the North American Truck of the Year and the
Texas Auto Writers Association's "Truck of Texas."

Ford Flex, the company's newest crossover utility, finished 2008
with its best sales month of the year, netting 2,685 sales.  Flex
has the highest conquest rate of any Ford vehicle and is a
finalist for the North American Car of the Year.

In other car news, Ford Focus posted full-year sales of 195,823,
the small car's highest sales year since 2004 and up 13% versus
full-year 2007.  Focus parlayed SYNC technology and 35 mpg highway
fuel economy, which is 5 mpg better than Toyota's Corolla and 2
mpg better than the smaller Honda Fit, to achieve a market share
increase in the competitive small car segment -- its first share
increase since Focus was introduced during the 2000 model year.

Meanwhile, Ford Fusion posted near-record sales of 147,569 units
in 2008.  Fusion, Mercury Milan and Lincoln MKZ are redesigned for
the 2010 model year and will arrive in dealer showrooms this
spring.  The first-ever Fusion Hybrid will be America's most fuel-
efficient mid-size car with 41 mpg in the city and 36 mpg on
highway -- besting the Toyota Camry hybrid by 8 mpg in the city
and 2 mpg on highway.

Lincoln outpaced the competition as 2008 drew to a close.  Helped
by the all-new Lincoln MKS sedan, Lincoln sales totaled 9,053 in
December, down 10% compared with a year ago.  In the fourth
quarter, however, Lincoln increased its share in the luxury market
as its 16% sales decline was less than half of the average decline
of all other luxury brands.

U.S. Sales

In December, Ford, Lincoln and Mercury sales totaled 134,114, down
32% compared with a year ago.  Retail sales to individual
customers were down 27%, and fleet sales were down 42% (including
a 57% decline in daily rental sales), consistent with Ford Motor's
plans.

For the full year, Ford, Lincoln and Mercury sales totaled
1.9 million, down 20% versus a year ago.  Retail sales were down
22%, and fleet sales were down 17% (including a 22% decline in
daily rental sales), in line with Ford's plans.

U.S. Market Share

In the Fourth Quarter, Ford, Lincoln and Mercury's market share is
estimated at 15.0%, up 0.9 points versus a year ago.  This is the
first time since 2001 that the company's Fourth Quarter market
share was higher than a year ago.

For the full year of 2008, Ford, Lincoln and Mercury's market
share is estimated at 14.2%, down 0.4 points versus a year ago.
This marks the company's smallest decline in market share this
decade.

"This is a strong ending to...a very challenging year," said
marketing chief Jim Farley.

                      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 Nov. 11,
2008, Moody's Investors Service lowered the debt ratings of
Ford Motor Company, Corporate Family and Probability of
Default Ratings to Caa1 from B3.  The company's Speculative
Grade Liquidity rating remains at SGL-3 and the rating outlook
is negative.  In a related action Moody's also lowered the
long-term rating of Ford Motor Credit Company to B3 from B2.
The outlook for Ford Credit is negative.

As reported in the Troubled Company Reporter on Oct. 10, 2008,
Fitch Ratings downgraded the Issuer Default Rating of Ford Motor
Company and Ford Motor Credit Company by one notch to 'CCC' from
'B-'.


FRANK GORMAN: Court Okays Reorganization Plan
---------------------------------------------
The Sun reports that Frank Gorman said that the Hon. Joel
Rosenthal of the U.S. Bankruptcy Court for the District of
Massachusetts has approved his reorganization plan.

About 94% of the 200 creditors also accepted the plan, The Sun
relates, citing Mr. Gorman.  The report says that under the plan,
Mr. Gorman will distribute $130,000 to his creditors.  The report
states that about $400,000 will be paid in the next three months,
while the balance would be paid within the next six to 10 years.

According to The Sun, Judge Rosenthal named a representative from
the host of creditors, who attended the meetings and reported back
to the rest.  "We're looking at a minimal payout out front, which
comes up to about 2%.  Some of us are going to get tiny checks and
others will get larger checks, depending on what he owed us.
Everybody is going to get something, but it won't be much," the
report quoted the representative as saying.

Dracut, Massachusetts-based Frank J. Gorman, Sr., dba Gorman
Management Trust, has filed for Chapter 11 protection on
Sept. 10, 2007 (Bankr. D. Mass. Case No. 07-43372).  John O.
Desmond, Esq., at John O. Desmond assists the company in its
restructuring effort.  The company listed assets of $1 million to
$100 million and debts of $1 million to $100 million.


FRONTIER AIRLINES: Seeks June 4 Extension of Plan Filing Deadline
-----------------------------------------------------------------
Frontier Airlines Inc., said it needs an additional four months
submit its Chapter 11 plan of reorganization.  Accordingly,
Frontier asks the U.S. Bankruptcy Court for the Southern District
of New York to extend its exclusive period to file a Chapter 11
plan extended from Feb. 4 to June 4.

Frontier and its units, "believe they are on pace for a successful
emergence from Chapter 11 during 2009," the company said in the
court filing, according to Bloomberg News.

Frontier, according to the report, has been cutting costs by
negotiating new labor contracts and trimming its plane fleet.
As reported by yesterday's Troubled Company Reporter, Frontier
Airlines' aircraft appearance agents and maintenance cleaners
represented by the International Brotherhood of Teamsters have
ratified the long-term labor agreement with the airline.
Frontier Airlines also reached a tentative agreement for long-term
wage and benefits concessions with leaders of the Frontier
Airlines Pilots Association on December 19, 2008.

                   About Frontier Airlines Inc.

Headquartered in Denver, Colorado, Frontier Airlines Inc. --
http://www.frontierairlines.com/-- provides air transportation
for passengers and freight.  It operates jet service carriers
linking Denver, Colorado hub to 46 cities coast-to-coast, 8 cities
in Mexico, and 1 city in Canada, as well as provide service from
other non-hub cities, including service from 10 non-hub cities to
Mexico.

The Debtor and its debtor-affiliates filed for Chapter 11
protection on April 10, 2008, (Bankr. S.D. N.Y. Case No.
08-11297 thru 08-11299.)  Benjamin S. Kaminetzky, Esq., and Hugh
R. McCullough, Esq., at Davis Polk & Wardwell, represent the
Debtors in their restructuring efforts.  Togul, Segal & Segal
LLP is the Debtors' Conflicts Counsel, Faegre & Benson LLP is
the Debtors' Special Counsel, and Kekst and Company is the
Debtors' Communications Advisors.

(Frontier Airlines Bankruptcy News, Issue No. 29; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)


GATEHOUSE MEDIA: Bank Debt Sells at Almost 90% Discount
-------------------------------------------------------
Participations in a syndicated loan under which GateHouse Media,
Inc., is a borrower traded in the secondary market at 12.60 cents-
on-the-dollar during the week ended January 2, 2009, according to
data compiled by Loan Pricing Corp. and reported in The Wall
Street Journal.  This represents a drop of 1.20 percentage points
from the previous week, the Journal relates.  The syndicated loan
matures on February 27, 2014.  The bank loan carries Moody's Caa1
rating and Standard & Poor's CCC+ rating.

The bank loan sold for 14.40 cents-on-the-dollar during the week
ended December 12, 2008 -- at that time, a drop of 3.35 percentage
points from the then previous week.

On December 5, 2008, Martin Bandier sent email correspondence to
Wesley R. Edens, the Chairman of the Board of Directors of
GateHouse Media, announcing Mr. Bandier's resignation as a member
of the company's Board and from all other committee positions he
holds with the company, effective that day.  There are no
disagreements between Mr. Bandier and the company on any matter
relating to the company's operations, policies or practices that
caused or contributed to his decision to tender his resignation as
a director.

On December 18, 2008, Howard Rubin sent email correspondence to
Michael E. Reed, the Chief Executive Officer of the company,
announcing Mr. Rubin's resignation as a member of the company's
Board and from all other committee positions he holds with the
company, effective that day.  There are no disagreements between
Mr. Rubin and the company on any matter relating to the company's
operations, policies or practices that caused or contributed to
his decision to tender his resignation as a director.

As reported by the Troubled Company Reporter, in September,
Standard & Poor's Ratings Services lowered the corporate credit
rating on GateHouse Media Operating Inc. to 'CCC+' from 'B'. "The
downgrade reflects increased pressure on GateHouse's liquidity
profile given current newspaper industry trends," said Standard &
Poor's credit analyst Liz Fairbanks.  "We are concerned that the
company's free cash flow and other cash sources may not be
sufficient to meet obligations over the next year."

S&P noted that the company's obligations include the need for full
repayment of outstanding revolver borrowings ($27.7 million as of
Aug. 4) by Nov. 15, 2008 to avoid violating the company's total
leverage covenant, repayment of its note payable to Morris
Publishing Group ($10.4 million) due Nov. 30, 2008, and repayment
of its bridge loan ($17.0 million) due Aug. 15, 2009.

During the third quarter ended September, the company paid off its
revolving credit facility.  With the revolving credit facility at
zero, the company is not subject to any leverage test under its
long term credit facility.  The company has said it does not
intend to borrow on the revolving credit facility in the near term
and intends to fund working capital needs with cash from
operations.

On February 15, 2008, GateHouse Media Intermediate Holdco, Inc., a
subsidiary of GateHouse Media Holdco II, Inc., and GateHouse Media
entered into a Bridge Credit Agreement with Barclays Capital, as
syndication agent, sole arranger and book runner.  The 2008 Bridge
Facility provided a $20.6 million term loan facility subject to
extensions through August 15, 2009.  The 2008 Bridge Facility is
secured by a first priority security interest in all present and
future capital stock of Holdco owned by Holdco II and all proceeds
thereof.

No principal payments are due on the 2008 Bridge Facility until
the maturity date.  As of September 30, 2008, a total of
$17 million was outstanding under the 2008 Bridge Facility.  On
October 17, 2008, Barclay's granted the company a waiver from
compliance with the total leverage ratio covenant with respect to
the quarter ending September 30, 2008.

GateHouse has said it cannot provide any assurance that it will be
in compliance with this or any other covenant contained in the
2008 Bridge Facility in future periods or that Barclay's will
grant any waivers in the future.

Effective October 24, 2008, the New York Stock Exchange delisted
the company's common stock.  The company's common stock is
currently quoted in the over-the-counter market under the trading
symbol "GHSE".

GateHouse Media, Inc. -- http://www.gatehousemedia.com/--
headquartered in Fairport, New York, is one of the largest
publishers of locally based print and online media in the United
States as measured by its 97 daily publications.  GateHouse Media
currently serves local audiences of more than 10 million per week
across 21 states through hundreds of community publications and
local Web sites.

As of September 30, 2008, the company reported $1.34 billion in
total assets and $1.38 billion in total liabilities, resulting in
$34.1 million in stockholders' deficit.  The company reported
total revenues of $171.6 million in the quarter, an increase of
6.4% over the third quarter of 2007.


GATEHOUSE MEDIA: Files Copyright Infringement Suit v. N.Y. Times
----------------------------------------------------------------
The Intellectual Property Reporter on December 29, 2008, reported
that GateHouse Media Inc., doing business as GateHouse Media New
England, by its attorneys, Hiscock & Barclay, LLP, on Dec. 22,
2008, filed a suit against The New York Times Co., doing business
as Boston.com, before the U.S. District Court of Massachusetts.

GateHouse raised a copyright breach complaint against The Boston
Globe's parent company, The New York Times Co., for linking to
GateHouse articles on the Globe's new local websites.

GateHouse asserted that the New York Times violated copyright law
by copying headlines and the first few sentences from articles in
the Newton Tab, Daily News Tribune of Waltham, and other GateHouse
papers on the Globe's websites.

GateHouse, which argues that it holds valid copyright interests as
well as trademark rights, is seeking immediate injunctive relief
to "put a halt to the blatant, willful and significant
infringement" engaged in by the New York Times. It also hopes to
receive compensatory damages, the disgorgement of profits earned
from its infringement, punitive damages, and legal fees.

In addition, Gatehouse claims that the infringing Web sites are
giving the "clear but false impression" that Gatehouse has
authorized the reproduction, display, and distribution of its
original content.

Aside from copyright infringement, GateHouse is also asserting
unfair competition, false advertising, trademark dilution, unfair
business practices, and other misconduct.

GateHouse Media, Inc. engages in the publication of print and
online media in the United States. It publishes yellow page and
white page directories in Sacramento, California area, as well as
provides Internet yellow pages. It also produces various niche
publications that address specific local market interests. The
Company, formerly known as Liberty Group Publishing, Inc., is
based in Fairport, New York.

The New York Times Co. operates as a diversified media company in
the United States. It operates in two segments, News Media and
About Group.

GateHouse Media, Inc. -- http://www.gatehousemedia.com/--
headquartered in Fairport, New York, is one of the largest
publishers of locally based print and online media in the United
States as measured by its 97 daily publications.  GateHouse Media
currently serves local audiences of more than 10 million per week
across 21 states through hundreds of community publications and
local Web sites.

As of September 30, 2008, the company reported $1.34 billion in
total assets and $1.38 billion in total liabilities, resulting in
$34.1 million in stockholders' deficit.  The company reported
total revenues of $171.6 million in the quarter, an increase of
6.4% over the third quarter of 2007.

Participations in a syndicated loan under which GateHouse Media,
Inc., is a borrower traded in the secondary market at 12.60 cents-
on-the-dollar during the week ended January 2, 2009, according to
data compiled by Loan Pricing Corp. and reported in The Wall
Street Journal.  This represents a drop of 1.20 percentage points
from the previous week, the Journal relates.  The syndicated loan
matures on February 27, 2014.  The bank loan carries Moody's Caa1
rating and Standard & Poor's CCC+ rating.

Effective October 24, 2008, the New York Stock Exchange delisted
the company's common stock.  The company's common stock is
currently quoted in the over-the-counter market under the trading
symbol "GHSE".


GENESIS HOSPICE: Voluntary Chapter 11 Case Summary
--------------------------------------------------
Debtor: Genesis Hospice Care LLC
        PO Box 1888
        Cleveland, MS 38733

Bankruptcy Case No.: 08-15576

Chapter 11 Petition Date: December 29, 2008

Court: United States Bankruptcy Court
       Northern District of Mississippi (Aberdeen)

Debtor's Counsel: Gwendolyn Baptist-Hewlett, Esq.
                  1305 Church Rd. E.
                  P.O. Box 312
                  Southaven, MS 38671
                  Tel.: (662) 349-9179
                  Email: sd@baptistlaw.com

Estimated Assets: Unknown

Estimated Debts: Unknown

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

The petition was signed by Charlie Brandon.


GREEKTOWN CASINO: Hires Fine Point as New Management Consultants
----------------------------------------------------------------
Greektown Casino has executed an Engagement Letter with The Fine
Point Group, which will be responsible for improving operations
and boosting profitability.  Las Vegas-based Fine Point is led by
casino industry veterans who have worked with more than 200 gaming
properties across the world.

Engaging The Fine Point Group is the second significant action
taken by Greektown Casino in the past 30 days to improve
operations and competitiveness. In December, the casino announced
changes to its Management Board.  Pending approval from the Sault
Ste. Marie Tribe of Chippewa Indians, owners of Greektown Casino,
three business executives with significant casino gaming,
hospitality industry, and reorganization experience will join the
Management Board.  The Fine Point Group and the new five-member
Management Board will work with Greektown's legal and
restructuring advisors to guide the property through its Chapter
11 reorganization, a process that began in May 2008 and is
expected to continue through exit in no later than September this
year.

The Fine Point Group is renowned for its expertise in strategic
casino management, customer relationship marketing, loyalty
program development, property turnarounds, and other aspects of
casino operations, according to the company's news statement.  The
firm's engagement is pending approvals from the Michigan Gaming
Control Board and the U.S. Bankruptcy Court in Detroit. Upon
receiving approvals, three members of the firm will assume the
interim roles of CEO, General Manager, and Vice President of
Marketing, with full decision-making authority.

"We are proud to have been chosen for this opportunity to partner
with Greektown Casino, a property with tremendous potential in a
city of history, pride, culture and economic importance," said The
Fine Point Group's Managing Director Randall A. Fine. "We will
work with all parties to improve the competitiveness and
profitability of Greektown Casino and to position the property for
far greater success."

Led by Mr. Fine and other casino veterans, The Fine Point Group
has worked in virtually every major casino market worldwide --
from five-star Las Vegas strip properties to a 75-slot machine
parlor near a subway station in the former Soviet Union. The firm
believes each gaming market has unique competitive and consumer
pressures that demand a custom strategy, and over its history has
been able to meaningfully "move the needle" in each of its
assignments.

Mr. Fine is a former Vice President of Total Rewards and Product
Marketing and Vice President of Slots and Total Rewards Operations
at Harrah's Entertainment, the world's largest gaming company. He
is the sole named inventor of the U.S. patent backing the gaming
industry's leading loyalty system and was responsible for more
than 40,000 slot machines that drove $4 billion in annual
revenues. He left Harrah's to join Carl Icahn's casino company,
where in less than 18 months he dramatically increased revenues --
while decreasing marketing expenses -- at all four of Icahn's
casinos, and helped position those properties for sale at a $1
billion profit to Goldman Sachs.  Mr. Fine, who founded The Fine
Point Group in 2005, has also worked at McKinsey & Company, Lehman
Brothers, and for the U.S. House of Representatives. He taught
Economics at Harvard College and holds his undergraduate degree
magna cum laude, and his MBA degree, with high honors, from
Harvard University. Upon regulatory approval, Mr. Fine will be
named the acting Chief Executive Officer of Greektown Casino.

On this assignment, Mr. Fine will be joined by a team from The
Fine Point Group, two of whom will be on-site full-time. The team
will include former executives of Harrah's Entertainment, MGM
MIRAGE, Colony Capital, Station Casinos, and Isle of Capri
Casinos.  On the Net: http://www/thefinepointgroup.com/

                     About Greektown Casino

Based in Detroit, Michigan, Greektown Holdings, LLC and its
affiliates -- http://www.greektowncasino.com/-- operates world-
class casino gaming facilities located in Detroit's historic
Greektown district featuring more than 75,000 square feet of
casino gaming space with more than 2,400 slot machines, over 70
tables games, a 12,500-square foot salon dedicated to high limit
gaming and the largest live poker room in the metropolitan Detroit
gaming market.

Greektown Casino employs approximately 1,971 employees, and
estimates that it attracts over 15,800 patrons each day, many of
whom make regular visits to its casino complex and related
properties.  In 2007, Greektown Casino achieved a 25.6% market
share of the metropolitan Detroit gaming market.  Greektown Casino
has also been rated as the "Best Casino in Michigan" and "Best
Casino in Detroit" numerous times in annual readers' polls in
Detroit's two largest newspapers.

The company and seven of its affiliates filed for Chapter 11
protection on May 29, 2008 (Bankr. E.D. Mich. Lead Case No.
08-53104).  Daniel J. Weiner, Esq., Michael E. Baum, Esq., and
Ryan D. Heilman, Esq., at Schafer and Weiner PLLC, represent the
Debtors in their restructuring efforts.  Judy B. Calton, Esq., at
Honigman Miller Schwartz and Cohn LLP, represents the Debtors as
their special counsel.  The Debtors chose Conway MacKenzie &
Dunleavy as their financial advisor, and Kurtzman Carson
Consultants LLC as claims, noticing, and balloting agent.

When the Debtor filed for protection from its creditors, it listed
consolidated estimated assets and debts of $100 million to
$500 million.

(Greektown Casino Bankruptcy News, Issue No. 17; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000).


HARRAH'S ENTERTAINMENT: Moody's Raises Ratings to 'Caa1/LD'
-----------------------------------------------------------
Moody's Investors Service raised Harrah's Entertainment, Inc.'s
Probability of Default rating to Caa1/LD from Ca reflecting the
closing of HET's debt exchange transaction.  Moody's affirmed
Harrah's other ratings and adjusted the loss given default
assessments to reflect the new post-debt exchange capital
structure.  In approximately three business days, Moody's will
remove the LD designation from the PD rating.

The Exchange Transaction resulted in a swap of junior debt (at a
discount) for new second lien notes.  Existing note holders that
elected to participate in the Exchange Transaction accepted
principal reductions of between 0% - 63%, depending upon the date
tendered and the class of notes.  Moody's views the exchange as a
distressed exchange for the particular securities involved, and
reflects that a limited default has occurred through the
assignment of the probability of default rating of Caa1/LD.

The debt exchange was funded with about $290 million in cash and
issuance of approximately $1.062 billion of new second lien notes
-- $214.8 million due 2015 and $847.6 million due 2018.  The
result of the debt exchange is an approximate $1.16 billion net
reduction in existing senior unsecured and subordinated debt.

The Exchange Transaction resulted in a modest improvement in
leverage and interest coverage.  Additionally, Harrah's liquidity
profile modestly improved with a reduction of required debt
amortization of about $435 million in 2010.  However, the
company's Caa1 CFR and Caa1/LD PDR as well as its negative rating
outlook reflect Harrah's very weak credit metrics, and the higher-
than-average probability that another default or distressed
exchange could occur over the next two years.  Moody's believes
that gaming demand will continue to drop in 2009 given
deteriorating macro-economic conditions, and that Harrah's
operating performance will continue to suffer.  Although HET
maintains adequate liquidity, its capital structure appears
unsustainable unless gaming demand rebounds significantly.
Consolidated debt/EBITDA and EBITDA/interest (incorporating
Moody's standard analytic adjustments), is approximately 11.0
times and 1.7 times respectively, and is likely to deteriorate in
2009.

HET's Speculative Grade Liquidity rating of SGL-3 reflects
adequate liquidity.  HET is expected to generate negative free
cash flow over the next four quarters, offset by cash balances and
the existence of a $2.0 billion revolving credit facility that is
expected to remain available to the company.  Even assuming a
modest decline in EBITDA in 2009, HOC should maintain adequate
head room under the senior secured leverage covenant.

Ratings upgraded:

Harrah's Entertainment, Inc.:

  -- Probability of Default to Caa1/LD from Ca

Ratings affirmed and assessments updated:

Harrah's Entertainment, Inc.

  -- Corporate Family Rating at Caa1

Harrah's Operating Company, Inc.

  -- Senior secured guaranteed revolving credit facility at B1
     (LGD 2, 22%)

  -- Senior secured guaranteed term loans at B1 (LGD 2, 22%)

  -- Senior unsecured guaranteed notes at Caa2 (LGD 5, 72%)

  -- Senior unsecured debt at Caa3 (LGD 5, 89%)

  -- Senior subordinated notes at Caa3 (LGD 6, 96%)

  -- Speculative grade liquidity rating at SGL-3

Moody's last action on Harrah's took place on November 20, 2008,
when Moody's downgraded Harrah's CFR to Caa1 and the Probability
of Default rating to Ca.

Harrah's Entertainment, Inc., through its wholly-owned subsidiary,
Harrah's Operating Company, Inc., owns or manages approximately 50
casinos that comprise around 40,000 hotel rooms, three million
square feet of gaming space, and two million square fee of
convention center space.  Affiliates of Apollo LLC (Apollo) and
Texas Pacific Group (the Sponsors) acquired the company through a
$31 billion leverage buy-out in early 2008.


HANOVER INSURANCE: Moody's Reviews 'Ba1' Insurance Strength Rating
------------------------------------------------------------------
Moody's Investors Service said that the ratings of The Hanover
Insurance Group, Inc. (senior debt at Baa3 / stable) and Hanover
Insurance Company (insurance financial strength at A3 / stable)
remain unchanged following completion of the sale of its remaining
life insurance business, First Allmerica Financial Life Insurance
Company, to Commonwealth Annuity and Life Insurance Company, a
Goldman Sachs company.  The Ba1 insurance financial strength
rating of FAFLIC remains on review for possible upgrade, subject
to consideration of any explicit support to be provided by Goldman
Sachs (senior unsecured at A1 / negative).

According to Moody's, the sale of FAFLIC is an incremental
positive to The Hanover as it allows the company to monetize the
capital in this run-off business and increase holding company cash
by over $200 million.  The sale also marks a final step in the
company's exit from life insurance and annuity products, allowing
management to focus its attention exclusively on property-casualty
insurance.

The final purchase price is subject to adjustments as of
December 31, 2008 but is expected to be generally consistent with
The Hanover's estimates to date and those contemplated by Moody's
in July 2008 when the transaction was first announced.

Based in Worcester, Massachusetts, The Hanover Insurance Group is
a holding company for insurance subsidiaries which collectively
rank among the top 35 property-casualty insurers in the United
States.  Through its network of over 2,000 independent agents, it
offers a range of property and casualty insurance products to
individuals and business owners.  Through the first nine months of
2008, the company reported net written premiums of $1.9 billion,
net income from continuing operations of $62 million, and
shareholders' equity of $2.0 billion at September 30, 2008.

The last rating action occurred on August 6, 2008 when Moody's
affirmed the ratings of The Hanover after it agreed to acquire AIX
Holdings, Inc., a small specialty property-casualty insurer.


HORIZON HOTEL: Involuntary Chapter 11 Case Summary
--------------------------------------------------
Alleged Debtor: Horizon Hotel Resort and Spa Inc.
                1050 East Palm Canyon Drive
                Palm Springs, CA 92264

Case Number: 09-10009

Type of Business: The Debtor operates a hotel.

Involuntary Petition Date: January 2, 2009

Court: Central District Of California (Riverside)

Judge: Meredith A. Jury

Petitioner's Counsel: Timothy Mccandless, Esq.
                      15647 Village Dr.
                      Victorville, CA 92392
                      Tel: (760) 733-8885

   Petitioners                 Nature of Claim      Claim Amount
   -----------                 ---------------      ------------
Penny Estes                    construction         $172,050
73831 Smoke Tree Ct.
Palm Desert, CA 92660-6149

Mel List Architect             architect            $80,640
P.O. Box 412
GENOA, NV 89411-0412

Edgar E. Scheck                legal fees           $18,500
P.O. Box 11
Balboa Island, CA 92622-0011


HRP MYRTLE: Seeks to Convert Case to Chapter 7 Liquidation
----------------------------------------------------------
Lisa Fleisher at The Sun News reports that Hard Rock Park has
asked the U.S. Bankruptcy Court for the District of Delaware to
convert its Chapter 11 reorganization case to Chapter 7
liquidation, after failing to find a buyer.

Court documents say that because the bid and sale process has been
unsuccessful, "there exists no reasonable prospect of success in
the immediate future.  Regrettably, conversion of [the park's]
Chapter 11 bankruptcy cases to cases under Chapter 7 of the
bankruptcy code thus appears to be the only remaining means of
allowing the debtors' assets to be liquidated and potential causes
of action to be pursued and monetized for the benefit of
creditors."

According to court documents, Hard Rock, which filed for Chapter
11 bankruptcy in September, wants to sell itself and has asked the
Court to let it make severance payments of almost a quarter of a
million dollars to its top executives.

Hard Rock said it was valued at $400 million when it opened in
April 2008, The Sun News states.  Court documents say that Hard
Rock failed to attract any bidders who would be willing to pay at
least $35 million for the park at a Dec. 15 auction.

The Sun News says that cafe and casino company Hard Rock
International had licensed its brand name to Hard Rock for at
least $2.5 million per year.  The report states that Hard Rock
International is now asking the Court to allow the park to turn
over various memorabilia and release them from the license
agreement.  Hard Rock International, according to court documents,
said that the theme park had damaged its reputation and failed to
live up to its agreement to thoroughly advertise and market the
product.

                         About HRP Myrtle

Based 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).  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.  Richards, Layton &
Finger represents the Debtors as counsel.  Dorsey & Whitney LLP
represents the Officiala Committee of Unsecured Creditors as
counsel.  When the Debtors filed for protection from their
creditors, they listed assets and debts of between $100 million
and $500 million each.


INTERLAKE MATERIAL: Financial Crisis Prompts Chapter 11 Filing
--------------------------------------------------------------
Interlake Material Handling Inc. together with three of its
affiliates submitted a voluntary petition under Chapter 11 of the
Bankruptcy Code before the U.S. Bankruptcy Court for the District
of Delaware citing substantial operating losses, and negative cash
flow and EBITDA due to decline in activity in the residential and
commercial construction industry coupled the decline in economic
growth across most sectors of the U.S. economy.

Interlake said that declining customer orders and increase in
commodity prices affected its profitability during 2008.  The
decrease in steel prices -- and a corresponding decrease in value
of the company's inventory -- led to a tightening of its
availability under its prepetition senior secured facility.

Interlake is party to a certain first amended and restated credit
and security agreement with National City Business Credit Inc., as
administrative and collateral agent, and National City Bank, as
issuer, to provide:

   -- a $48 million revolving credit facility and letter of
      credit subfacility;

   -- a $15 million term loan; and

   -- a $3 million equipment loan.

The proceeds of the loans were used to fund working capital
requirements, among other things.  About $36 million remained
outstanding under the credit agreement as of the company's
bankruptcy filing.

In addition, the company is also party to a certain credit and
security agreement dated April 21, 2008, with RoyNat to provide as
much as $10.5 million in term loan, which was also used to finance
working capital requirements.

The company and a subsidiary came up with a plan to consolidate
their operations to avert bankruptcy but they were unable to
implement the plan when they failed to obtain the capital
necessary to execute that plan.  On Dec. 31, 2008, the company
entered into an acquisition agreement with Mecalux USA Inc. and
Mecalux Mexico S.A. de C.V., to purchase substantially all of the
company's assets for $30 million, subject to certain adjustments.
The company's senior secured lenders consented to the sale and
agreed to provide about $41.4 million debtor-in-possession
financing for a limited period of time after the conclusion of the
sale process.  The DIP loan is expected to enable the company to:

   a) continue its operations pending the marketing of the
      acquisition agreement to determine the highest and better
      offer;

   b) consider strategies for disposition of their remaining
      assets and the continuation or conclusion of their Chapter
      11 cases.

Bloomberg News, citing a regulatory filing, reported that Mecalux
said it plans to complete the deal this quarter.

Interlake listed assets between $50 million and $100 million, and
debts between $100 million and $500 million.  The company owes
$7.7 million to Heidtman Steel Products; $1.7 million to Steel
Technologies Inc.; $1.6 million to Custom Steel Processing; and
$1.2 million to Performance Steel.

The company proposed Winston & Strawn LLP as its bankruptcy
counsel; Young, Conaway, Stargatt & Taylor LLP as local counsel;
Lake Pointe Advisors LLC and Huron Consulting Services LLC as
financial advisors; and Kurtzman Carson Consultants LLC as claims
agent.

                     About Interlake Material

Headquartered in Naperville, Illinois, Interlake Material Handling
Inc. -- http://www.interlake.com -- makes steel storage racks in
the United States.


INTERLAKE MATERIAL: Case Summary & 30 Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: Interlake Material Handling Inc.
        1230 E. Diehl Road, Suite 400
        Naperville, IL 60563

Bankruptcy Case No.: 09-10019

Debtor-affiliates filing separate Chapter 11 petitions:

        Entity                                     Case No.
        ------                                     --------
United Fixtures Company, Inc.                      09-10020
UFC Interlake Holding Co.                          09-10021
Conco-Tellus, Inc.                                 09-10022

Type of Business: The Debtor makes steel storage racks in the
                  United States.
                  http://www.interlake.com/

Chapter 11 Petition Date: January 5, 2009

Court: District of Delaware (Delaware)

Judge: Kevin J. Carey

Debtors' Bankruptcy Counsel: Winston & Strawn LLP

Debtors' Local Counsel: M. Blake Cleary, Esq.
                        bankfilings@ycst.com
                        Young, Conaway, Stargatt & Taylor LLP
                        1000 West Street, 17th Floor
                        P.O. Box 391
                        Wilmington, DE 19899-0391
                        Tel: (302) 571-6600
                        Fax: (302) 571-1253

Financial Advisor: Lake Pointe Advisors LLC

Claims Agent: Kurtzman Carson Consultants LLC

Other Professional: Huron Consulting Services LLC

Estimated Assets: $50 million to $100 million

Estimated Debts: $100 million to $500 million

The Debtor's Largest Unsecured Creditors:

   Entity                      Nature of Claim   Claim Amount
   ------                      ---------------   ------------
Heidtman Steel Products        trade             $7,783,824
Inc.
2401 Front Street
Toledo, OH 43605
Fax: (419) 698-1150

Steel Technologies Inc.        trade             $1,778,190
15415 Shelbyville Road
Louisville, KY 40253
Fax: (502) 244-0172

Custom Steel Processing        trade             $1,610,343
1001 College Street
Madison, IL 62060
Fax: (618) 876-7243

Performance Steel              trade             $1,236,122
2500 E. Imperial Hwy #201
Brea, CA 92821
Fax: (714) 528-2919

Phoenix Stamping               trade             $746,285
6100 Emmanuel Dr., SW
Atlanta, GA 30336
Fax: (404) 699-2902

Alro Steel Corporation         trade            $548,689
3100 E. High St.
Jackson, MI 49204

Welded Products                trade            $542,624
1030 North Merrifield
Mishawaka, IN 46545
Fax: (574) 256-1885

Valspar Corp.                  trade            $512,828
1101 Third Street South
Minneapolis, MN 55415
Fax: (612) 375-7723

Field Fastener Supply Inc.     trade            $441,697

Atlas Material Handling Inc.   trade            $440,008

Wal-Mart Logistics             trade            $427,912

DACS                           trade            $420,940

Patriot Installations Inc.     trade            $405,000

Great Western Steel Inc.       trade            $380,653

Kelco Metals Inc.              trade            $373,847

Up-Rite Systems Inc.           trade            $359,266

CED Inc.                       trade            $307,619

Lexington Steel Corp.          trade            $306,638

Nucor Steel Darlington         trade            $268,647

Tri "R" Erecting               trade            $188,963

Western Pacific Storage Sys.   trade            $180,747

Tri-Ad Metals International    trade            $166,672

Arizona Galvanizing Inc.       trade            $164,859

Double-M-Machine Inc.          trade            $158,323

Intelligrated Products LLC     trade            $153,210

Patriot Construction Corp.     trade            $147,724

AWP Industries Inc.            trade            $140,078

Premier Packaging              trade            $137,044

Midwest Molding Solutions Inc. trade            $131,497

The petition was signed by chief financial officer Jacqueline M.
Barry.


J.M. CAPITAL: Case Summary & Largest Unsecured Creditor
-------------------------------------------------------
Debtor: J.M. Capital, Ltd.
        4911 Caroline Dr. # 1
        Warrensville Hts., OH 44128

Bankruptcy Case No.: 08-20123

Chapter 11 Petition Date: December 24, 2008

Court: United States Bankruptcy Court
       Northern District of Ohio (Cleveland)

Judge: Judge Pat E. Morgenstern-Clarren

Debtor's Counsel: Jonathan P Blakely, Esq.
                  Bernlohr Wertz, L.L.P.
                  The Nantucket Building
                  23 S. Main Street, Third Floor
                  Akron, OH 44308
                  Tel.: (330) 434-1000
                  Fax : (330) 434-1001
                  Email: jblakely@b-wlaw.com

Estimated Assets: $0 t0 $50,000

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

The Debtor's Largest Unsecured Creditor is Gerri Birch, for a
contingent, unliquidated and disputed claim.

The petition was signed by John MacDonald, managing member of the
company.


KB TOYS: Li & Fung Faces $10-Mil. Payment Demand from HK Toymakers
------------------------------------------------------------------
More than 40 suppliers of Li & Fung Ltd. are seeking a total of
$10 million from Li & Fung after KB Toys filed for bankruptcy on
Dec. 11.

According to Bloomberg News, the Hong Kong-based companies, acting
as the Joint Committee for Li & Fung Creditors, aim to recover
money they say is owed to them by Li & Fung for goods sold to KB
Toys, Ricky Ng, the group's spokesman, said.

Li & Fung has insisted that it was only acting as KB Toys' agent,
Business Times says.


"As one of the largest creditors of KB Toys, Li & Fung
will seek proper recourse from the bankruptcy courts and has
approached most of the affected factories to meet with the group
to discuss how it can help them to deal with the bankruptcy
proceedings in the U.S.," Li & Fung Executive Director Henry Chan
said in an e-mailed statement, Bloomberg added.

Headquartered in Pittsfield, Massachusetts, KB Toys, Inc. --
http://www.kbtoys.com-- operates a chain of retail toy stores.

On Jan. 14, 2004, the Debtor and 69 of its affiliates filed for
protection under Chapter 11 of the Bankruptcy Code, which were
administratively consolidated under Case No. 04-10120.  Two of the
200 bankruptcy cases remain open, KB Toys Inc. and KB Toy of
Massachusetts Inc.  In connection with the emergence of KB Toys
from bankruptcy in August 2005, and the subsequent organizational
restructuring, the assets and operations of may of these prior
debtors were transferred among then existing debtor entities and
consolidated with KB Toys Group.  Furthermore, most of the
entities involved were either dissolved or were merged into
surviving entities, and several of them changed their names.  As
a result, nine Debtors and four inactive special purpose units
which are not debtors.

The company, together with eight of its affiliates, again filed
for Chapter 11 on December 11, 2008 (Bankr. D. Del. Lead Case No.
08-13269).  Joel A. Waite, Esq., and Matthew Barry Lunn, Esq., at
Young, Conaway, Stargatt & Taylor LLP, represent the Debtors in
their restructuring efforts.  The Debtors proposed Wilmer Cutler
Pickering Hale and Dorr LLP as their co-counsel, FTI Consulting
Inc. as financial and restructuring advisor, and Epiq Bankruptcy
Solutions LLC as claims and noticing agent.

According to Bloomberg, KB listed assets of $241 million against
debt totaling $362 million in its Chapter 11 petition filed
on Dec. 11.  The debts include $143 million in unsecured claims;
and $200 million in secured claims, including $95.1 million owed
to first-lien creditors where General Electric Capital Corp.
serves as agent; and $95 million owed to second-lien creditors.

As reported by the Troubled Company Reporter on Dec 22. 2008, the
Hon. Kevin Carey of the U.S. Bankruptcy Court for the District of
Delaware has allowed KB Toys Inc. to start going-out-of-business
sales.  KB Toys expects the liquidation sales to be completed by
Feb. 9, 2009.


KEY PLASTICS: Court Sets Jan. 29 Disclosure Statement Hearing
-------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware will hold a
hearing on Jan. 29, 2009 at 2:00 p.m. prevailing Eastern time to
consider approval of Key Plastics L.L.C. and Key Plastics Finance
Corp.'s proposed Disclosure Statement explaining their Prepackaged
Plan of Reorganization which was filed with the Court on Dec. 15,
2008.  A hearing to consider confirmation of the Plan and any
objections thereto will commence immediately following the
Disclosure Statement Hearing.

Any objections to the Disclosure Statement or the the Prepackaged
Plan must be filed with the Court together with proof of service,
so as to be received no later than 4:00 p.m prevailing Eastern
time on Jan. 18, 2009.  Objections whould also be served upon
counsel of the Debtors:

          Weil, Gotshal & Manges LLP
          Attn: Stephen A. Youngman, Esq.
          200 Crescent Court
          Suite 300
          Dallas, Texas 76201

          and

          Richards, Layton & Finger, P.A.
          Attn: Mark D. Collins, Esq.
          One Rodney Square
          P.O. Box 551
          Wilmington
          Delaware 19899

As reported in the Troubled Company Reporter on Dec. 16, 2008,
under the plan, each holder of Key Plastics Series A Unit Claims
will be paid cash equal to $474 per Series A Unit held.  At its
option, holders of Senior Notes will be entitled to receive,
either:

   -- pro rata share of 65% of the fully-diluted new common units
      to be issued by Reorganized Key Plastics, which will
      subsequently be contributed to the Reorganized Finance
      Corp. in exchange for an equal percentage of new common
      stock to be issued by Reorganized Finance Corp.; or

   -- cash equal to 16% of the face value of the holder's senior
      notes.

Furthermore, holders of senior notes who elect to receive their
pro rata share of New Key Plastics Equity will be entitled to
participate in a rights offering in which each holder may
subscribe for its pro rata share of no more than 35% of New Key
Plastics Equity, which will also subsequently be contributed to
the reorganized Finance Corp. in exchange for an equal percentage
of New Finance Corp. Equity.

The company related that on Nov. 12, 2008, it solicited votes on
the plan, wherein holders of Senior Notes Claims under Class 1 and
Series A Unit Claims voted to accept the plan.

Headquartered in Northville, Michigan, Key Plastics LLC --
http://www.keyplastics.com/-- supplies plastic components to the
automotive industry.  The company has 24 manufacturing facilities
located in the United States, Canada, Mexico, Germany, Portugal,
Spain, the Czech Republic, France, Slovakia, Italy and China.
According to Bloomberg News, the company filed for bankruptcy in
March 23, 2000, in Detroit and emerged a year later under the
ownership of private-equity firm Carlyle.  The company and Key
Plastics Finance Corp. filed separate petitions for Chapter 11
relief on Dec. 15, 2008 (Bankr. D. Del. Case Lead Case No.
08-13324).  Mark D. Collins, Esq., at Richards Layton & Finger PA;
and Stephen A. Youngman, Esq., and Martin A. Sosland, Esq., at
Weil, Gotschall & Manges LLP, represent the Debtors in their
restructuring efforts.  When the Debtors filed for protection from
their creditors, they listed assets and debts between
$100 million and $500 million each.


KP FASHION: Files for Chapter 11 Bankruptcy in New York
-------------------------------------------------------
Bloomberg's Bob Van Voris reports that KP Fashion Co. made a
voluntary Chapter 7 of the United States Bankruptcy Code in the
United States Bankruptcy Court for the Southern District of New
York seven months after opening its first store.

The company posted $9.7 million in assets and $54.4 million in
debts in its filing, Bloomberg says.  The company sought from
protection from its creditors while it liquidates, source says.
According to the company's Web site, clothes are priced at 75%
discount, Bloomberg notes.

Sergei Plastinina co-founded Russia-based dairy company, OAO Wimm-
Bill-Dann, Mr. Voris relates.  Mr. Plastinina has investments in
real estate, agriculture and fertilizer industry, Mr. Voris says.

The company's 70 stores in Russia are not included in the filing,
Bloomberg notes.

"I've been working really hard, and am very proud of myself
for keeping my determination and being able to work and
accomplish so much at my young age," Bloomberg quoted Mr.
Plastinina stated in his personal website before it filed for
protection.

Bloomberg, citing the company's regulatory filing, relates that
the company owes $29.9 million in loan to Lendero Ltd. of Cyprus,
which company controlled by Mr. Plastinin.

KP Fashion Co. -- http://www.kpfashion.com/-- was created by
Sergei Plastinina, father of Russian fashion designer Kira
Plastinina to market her clothing line in the United States,
Bloomberg notes.


LEAP WIRELESS: Posts $93 Million Net Loss in Last Nine Months
-------------------------------------------------------------
Leap Wireless International, Inc., reported financial and
operational results for the quarter ended Sept. 30, 2008.

For three months ended Sept. 30, 2008, the company posted net loss
of $48.7 million compared with net loss of $43.2 million for the
same period in the previous year.

For nine months ended Sept. 30, 2008, the company posted net loss
of $93.0 million compared with net loss of $57.8 million for the
same period in the previous year.

At Sept. 30, 2008, the company's balance sheet showed total assets
of $5.0 billion, total liabilities of $3.4 billion
andstockholders' equity of $1.6 billion.

The company has a total of $826.3 million in unrestricted cash,
cash equivalents and short-term investments as of Sept. 30, 2008.

Capital expenditures during the third quarter of 2008 were
$190.0 million, including expenditures associated with the build-
out of new markets and capitalized interest.

A full-text copy of the 10-Q filing is available for free at
http://ResearchArchives.com/t/s?3738

                       About Leap Wireless

Based in San Diego, Leap Wireless International Inc. (Nasdaq:
LEAP) -- http://www.leapwireless.com/-- provides innovative,
high-value wireless services.  With the value of unlimited
wireless services as the foundation of its business, Leap
pioneered its Cricket(R) service.  The company and its joint
ventures now operate in 29 states and hold licenses
in 35 of the top 50 U.S. markets.  Through its affordable, flat-
rate service plans, Cricket offers customers a choice of unlimited
voice, text, data and mobile Web services.

                          *     *     *

As reported in the Troubled Company Reporter on June 24, 2008,
Moody's Investors Service assigned a Caa1 rating to Leap Wireless
International Inc.'s $200 million convertible notes, due 2014.
Moody's also assigned a B2 corporate family rating to Leap
Wireless International Inc.  Rating outlook is Stable.

As disclosed in the Troubled Company Reporter on June 23, 2008,
Standard & Poor's Rating Services assigned its 'CCC' rating to
Leap Wireless International Inc.'s proposed $200 million of
convertible senior notes due 2014, with a '6' recovery rating,
indicating the expectation for negligible (0%-10%) recovery in the
event of a payment default.  At the same time, S&P assigned a 'B-'
rating to funding unit Cricket Communications Inc.'s proposed $200
million of senior notes due 2015 with a '4' recovery rating,
indicating the expectation for average (30%-50%) in the event of a
payment default.  These are being issued under Rule 144A with
registration rights.  S&P also affirmed San Diego-based Leap's
existing ratings, including its 'B-' corporate credit rating.  The
outlook is stable.


LEE ENTERPRISES: Lenders Waive Credit and Pulitzer Deal Violations
------------------------------------------------------------------
Lee Enterprises, Inc. disclosed in a regulatory filing with the
Securities and Exchange Commission that certain covenant
violations related to the Credit Agreement and Pulitzer Notes were
waived.  The 2009 Waivers under the Credit Agreement and Pulitzer
Notes expire March 30, 2009, and Jan. 16, 2009.

The 2009 Waivers relate to the going concern modification of the
auditors' reports on the Consolidated Financial Statements of the
Company, and the separate financial statements of Pulitzer and PD
LLC for 2008, and a delay in the timing of delivery of 2008 year
end covenant compliance information related to the Credit
Agreement and the Pulitzer Notes.  Waivers were also obtained
related to a violation of the Consolidated Net Worth covenant as
of Sept. 28, 2008, and as of Dec. 28, 2008, under the Pulitzer
Notes.  The company is required to provide final 2008 year end
covenant compliance information related to the Credit Agreement no
later than Jan. 5, 2009.

The company paid fees and expenses related to the 2009 Waivers
totaling $1,874,000.

A full-text copy of the SECOND WAIVER TO CREDIT AGREEMENT is
available for free at http://ResearchArchives.com/t/s?374b

                  Amendments to Credit Agreement

The company entered into amendments to its Credit Agreement.
Under the 2009 Amendments, the company and certain of its
subsidiaries pledged substantially all of their tangible and
intangible assets, and granted mortgages covering certain real
estate, as collateral for the payment and performance of their
obligations under the Credit Agreement.  Assets of Pulitzer, the
company's ownership in interest in MNI and certain employee
benefit plan assets are excluded.

The 2009 Amendments reduce the amount available under the
revolving credit facility to $375,000,000 and eliminate the
incremental term loan facility.  The 2009 Amendments require the
company to suspend stockholder dividends and share repurchases
until its total leverage ratio is less than 4.5:1.  The 2009
Amendments also limit capital expenditures to $20,000,000 per
year, with a provision for carryover of unused amounts from the
prior year. Other covenants ensure that substantially all future
cash flows of the company are required to be directed for debt
reduction.

Further, the 2009 Amendments modify other covenants, including
restricting the company's ability to make additional investments
and acquisitions without the consent of its Lenders, limiting
additional debt beyond that permitted under the Credit Agreement,
and limiting the amount of unrestricted cash and cash equivalents
the company may hold to $15,000,000.

Under the 2009 Amendments, the company's credit spreads will
generally increase 200 basis points from the current pricing grid.
The maximum rate (for leverage greater than 6.25:1) will be
increased to LIBOR plus 400 basis points.  At the September 2008
leverage level, the company's debt under the Credit Agreement will
be priced at LIBOR plus 300 basis points.

Under the 2009 Amendments, the company's total leverage ratio
limit will increase from 5.25:1 to 6.25:1 in September 2008,
increase to 6.5:1 in December 2008, increase to 6.75:1 in
March 2009, decrease to 6.5:1 in December 2009, decrease to 6.25:1
in September 2010 and decrease to 4.5:1 in December 2010.  Each
change in the leverage ratio limit noted above is effective on the
last day of the fiscal quarter.

The interest expense coverage ratio limit will decline from 2.5:1
to 2.0:1 through March 2009, decrease thereafter to 1.7:1 through
September 2009, increase thereafter to 1.8:1 through December
2009, increase thereafter to 1.9:1 through March 2010, increase
thereafter to 2.0:1 through September 2010, and increase
thereafter to 2.5:1.

                          Pulitzer Notes

In conjunction with its formation in 2000, PD LLC borrowed
$306,000,000 (Pulitzer Notes) from a group of institutional
lenders (the Noteholders).  The aggregate principal amount of the
Pulitzer Notes is payable in April 2009 and bears interest at an
annual rate of 8.05%.  The Pulitzer Notes are guaranteed by
Pulitzer pursuant to a Guaranty Agreement dated May 1, 2000, with
the Noteholders. In turn, pursuant to an Indemnity Agreement dated
May 1, 2000, between The Herald Company, Inc. and Pulitzer,
Herald, Inc. agreed to indemnify Pulitzer for any payments that
Pulitzer may make under the Guaranty Agreement.  In December 2006,
Herald Inc. assigned its assets and liabilities to Herald.

The terms of the Pulitzer Notes, as amended, contain certain
covenants and conditions including the maintenance, by Pulitzer,
of EBITDA, as defined in the Guaranty Agreement, minimum net worth
and limitations on the incurrence of other debt.  At Sept. 28,
2008, Pulitzer was in compliance with the covenants, as waived or
amended from time to time.

In addition, the Pulitzer Notes and the Operating Agreement with
Herald require that PD LLC maintain the Reserve, consisting of
cash and investments in U.S. government securities, totaling
approximately $126,060,000 at Sept. 28, 2008, (Reserve).  The
Pulitzer Notes and the Operating Agreement provide for a
$3,750,000 quarterly increase in the minimum Reserve balance
through May 1, 2010, when the amount will total $150,000,000.

The Credit Agreement contains a cross-default provision tied to
the terms of the Pulitzer Notes.

The purchase price allocation of Pulitzer resulted in an increase
in the value of the Pulitzer Notes in the amount of $31,512,000,
which is recorded as debt in the Consolidated Balance Sheets.
This amount will be accreted over the remaining life of the
Pulitzer Notes, until April 2009, as a reduction in interest
expense using the interest method.  This accretion will not
increase the principal amount due to, or reduce the amount of
interest to be paid to, the Noteholders.

The Company is required to refinance the Pulitzer Notes from time
to time, as they become due, until May 1, 2015.

                       About Lee Enterprises

Lee Enterprises, Inc. publishes daily newspapers, weekly
newspapers, and specialty publications in the United States.  The
company has a strategic alliance with Yahoo!, Inc. Lee Enterprises
was founded in 1890.  It is based in Davenport, Iowa.


LEE ENTERPRISES: Posts $879.9MM Net Loss for Year Ended Sept. 28
----------------------------------------------------------------
KPMG LLP in Chicago, Illinois, in a letter dated December 31,
2008, to the Board of Directors and Stockholders of Lee
Enterprises Inc. expressed substantial doubt about the company's
ability to continue as a going concern.  The firm audited the
consolidated balance sheet of Lee Enterprises and subsidiaries as
of September 28, 2008, and the related consolidated statements of
operations and comprehensive income (loss), stockholders' equity
and cash flows for the 52-week period ended September 28, 2008.

"The company has short-term obligations that cannot be satisfied
by available funds and has incurred violations of debt covenants
that subject the related principal amounts to acceleration, all of
which raise substantial doubt about its ability to continue as a
going concern," KPMG said.

For the year ended September 28, 2008, Lee Enterprises Inc. posted
a net loss of $879,909,000 compared with net income of $80,999,000
for the same period a year earlier.

Mary E. Junck, chairman, president and chief executive officer,
and Carl G. Schmidt, vice president, chief financial officer and
treasurer, disclose in a regulatory filing that the company's
ability to operate as a going concern is dependent on its ability
to refinance or amend its debt agreements as they become due, or
earlier if available liquidity is consumed.

"The company's indebtedness could adversely affect its financial
health in any or all of [these] ways:

   * Substantially all of the cash flows of the company are
     required to be applied to payment of debt interest and
     principal, reducing funds available for investment, capital
     expenditures and other purposes;

   * The company reported significant net losses in 2008, due to
     impairment of goodwill and other assets resulting from the
     continuing and increasing difference between its stock price
     and the per share carrying value of its net assets. Reduced
     expectations of future cash flows were also an important
     factor in the determination of such impairment charges;

   * The company's flexibility to react to changes in economic and
     industry conditions may be more limited;

   * Increasing leverage could make the company more vulnerable in
     the event of additional deterioration of general economic
     conditions or other adverse events; and

   * There could be a material impact on the company's business if
     it is unable to meet the conditions of its debt agreements or
     obtain replacement financing."

"The company generated cash flows in 2008 sufficient to reduce net
debt by $102,225,000, pay dividends totaling $32,573,000 and
acquire shares of its Common Stock in the amount of $19,483,000.
The company does not have sufficient cash flows to meet both its
requirements for 2009 operations and repayment of the Pulitzer
Notes."

"2009 principal payments required under the Credit Agreement
totaling $142,500,000 are expected to exceed the company's cash
flows available for such payments. As a result, the company
expects to utilize a portion of its capacity under its revolving
credit facility to fund a portion of the 2009 principal payments
required. At September 28, 2008, the company had $207,000,000
outstanding under the revolving credit facility, and after
consideration of the 2009 Amendments, letters of credit and other
commitments, has approximately $162,000,000 available for future
use."

"Principal payments under the Credit Agreement totaling
$166,250,000 are due in 2010. The company expects to utilize the
remainder of its capacity under its revolving credit facility to
fund a portion of the 2010 principal payments required."

"The Pulitzer Notes mature in April 2009. The company is actively
engaged in discussions with the Noteholders, and to the extent
their approval may also be required, the Lenders, to extend or
refinance the Pulitzer Notes. The company has also initiated
discussions with the Lenders related to changes to the Credit
Agreement to maintain sufficient long-term liquidity. However, the
timing and ultimate outcome of such discussions cannot be
determined at this time due in part, to the abnormal condition of
the domestic credit markets and the overall recessionary operating
environment in which the company, Pulitzer, and other publishing
companies are currently operating. Continuing instability or
further disruptions of these markets could prohibit or make it
more difficult for the company to access new capital, increase the
cost of capital or limit its ability to refinance existing
indebtedness."

As of September 28, 2008, the company's balance sheet showed total
assets of $2,016,367,000, total liabilities of $1,869,280,000, and
total stockholders' equity of $147,087,000.

A full-text copy of the company's annual report is available for
free at: http://researcharchives.com/t/s?3746

                      About Lee Enterprises

Lee Enterprises is a publisher of local news, information and
advertising in primarily midsize markets, with 49 daily newspapers
and a joint interest in four others, expanding online sites and
more than 300 weekly newspapers and specialty publications in 23
states. Lee's newspapers have circulation of 1.5 million daily and
1.9 million Sunday, reaching more than four million readers daily.
Lee's online sites attract 12 million unique visitors monthly, and
Lee's weekly publications have distribution of more than 4.5
million households. Lee's markets include St. Louis, Mo.; Lincoln,
Neb.; Madison, Wis.; Davenport, Iowa; Billings, Mont.;
Bloomington, Ill., and Tucson, Ariz. Lee stock is traded on the
New York Stock Exchange under the symbol LEE.


LEHMAN BROTHERS: Wins Court Nod on Derivative Contracts Protocol
----------------------------------------------------------------
Lehman Brothers Holdings, Inc., won court approval to implement a
set of protocol governing the settlement or assignment of its
derivative contracts executed prior to its bankruptcy.

The U.S. Bankruptcy Court for the Southern District of New York
noted that derivative contracts executed by these companies which
previously filed objections to the proposed protocol, are not
subject to the Court's order:

  * Metavante Corporation
  * Portfolio Green German
  * Lincore Limited
  * E-Capital Profits Limited
  * Cheung Kong Bond Finance Limited
  * City and County of Denver, Department of Revenue
  * Tobacco Settlement Financing Corporation
  * First Choice Power L.P.
  * Reliant Energy Power Supply LLC
  * EnergyCo LLC
  * EnergyCo Marketing and Trading
  * Wells Fargo N.A.
  * JA Solar Holdings Co., Ltd.
  * West Corporation
  * Danske Bank A/S, London Branch
  * BRM Group Ltd.
  * SunAmerica Life Insurance Company
  * AIG CDS, Inc.
  * Lexington Insurance Company
  * Carlton Communications Limited
  * HarbourView CDO III
  * Norton Gold Fields Limited
  * Gaston Christian School Inc.
  * Bank of America, National Association
  * The Walt Disney Company
  * Deutsche Bank Trust Company Americas
  * Deutsche Bank National Trust Company
  * QVT Financial LP
  * Standard Chartered Bank
  * The Bank of New York Mellon
  * The Bank of New York Mellon Trust Company, N.A.
  * BNY Corporate Trustee Services Limited
  * U.S. Bank National Association
  * Lahde Capital Management Inc.
  * Instituto de Credito Oficial
  * Northcrest, Inc.
  * Citigroup Inc.
  * BRE Bank SA
  * The Toronto-Dominion Bank
  * Societe Generale
  * Canadian Imperial Bank Commerce
  * Calyon
  * Dexia Bank Internationale a Luxembourg SA
  * Dexia Credit Local
  * Dexia Kommunalbank Deutschland AG
  * Dexia Banque Belgiq7ue SA
  * Banif-Banco de Investimento S.A.
  * Occidental Energy Marketing Inc.
  * EPCO Holdings Inc.
  * Georgetown University
  * Bremer Financial Corporation
  * FPL Energy Power Marketing, Inc.
  * Florida Power & Light Company

The Court will convene a hearing to consider the objections of
these companies on Jan. 14.

Prior to the court decision, Lehman Brothers Holdings settled 65
of the more than 100 objections to its plan to resolve about
930,000 derivatives contracts, according to a report by Bloomberg
News.  About 30,000 of the contracts remain open, which are worth
billions of dollars to Lehman Brothers Holdings's creditors,
though the exact value is not clear.

                       Proposed Procedures

As reported by the Troubled Company Reporter Dec. 18, Robert
Lemons, Esq., at Weil Gotshal & Manges, in New York, said in a
court filing that the protocol would help reduce the costs
incurred from the assumption and assignment of the derivative
contracts or from the settlement of claims resulting from the
termination of the contracts.

"Considering the sheer number of derivative contracts, obtaining
court approval for each proposed assumption and assignment or
settlement would result in burdensome administrative expenses for
the estate," Mr. Lemons said.

LBHI proposes this protocol with respect to derivative contracts
it will assume and assign:

  (1) LBHI has five days before the assumption and assignment of
      the derivative contract to notify the person or company
      that is party to the contract.

  (2) The notice must contain:

      * the names and addresses of the parties to the
        contracts;

      * identification of the derivative contracts;

      * a statement that any assignee or its credit support
        provider has a Standard & Poor's or Fitch credit
        rating equal to or higher than A- or a Moody's credit
        rating equal to or higher than A3; any equivalent
        thereof; or the identity of any proposed assignee and
        its credit support provider if neither of them is
        qualified; and

      * any amounts proposed by LBHI to be paid to cure existing
        defaults.

  (3) Any party is deemed to have received adequate assurance
      of future performance if either an assignee or its credit
      support provider is qualified, or LBH no longer have any
      payment or delivery obligations under the contract after
      payment of the cure amount.

  (4) With respect to derivative contracts that may require
      the return of posted collateral as part of a cure amount,
      LBHI should either return the collateral or, if the
      collateral is no longer in its possession, it should pay
      the amount equal to the value of the collateral a day
      before it serves the notice based upon independent third-
      party pricing services.  LBHI's proposed manner of
      returning the collateral, including any amount proposed to
      be paid for collateral that is no longer in its
      possession, must be included in the notice as a cure
      amount.

  (5) Any party should serve its written objection, if any,
      within five days after the notice is served on Weil
      Gotshal & Manges, and Curtis Mallet-Prevost Colt &
      Mosle.  The party must specify the reasons for its
      objection.

  (6) If any party does not timely serve an objection, that
      party is deemed:

      * to have consented to the proposed cure amount, if any,
        and to the assumption and assignment of the contract;

      * to have agreed that the assignee has provided adequate
        assurance of future performance;

      * to have agreed that all defaults under the contract
        have been cured as a result or precondition of the
        assignment, such that the assignee or Lehman Brothers
        Holdings has no liability or obligation with respect
        to any default occurring or continuing prior to the
        assignment;

      * to have waived any right to terminate the contract or
        designate an early termination date under the contract
        as a result of any default that occurred and is
        continuing prior to the date of the assignment; and

      * to have agreed that the terms of the court order
        approving the proposed protocol apply to the
        assignment.

  (7) If LBHI is unable to resolve any objection, it may seek
      authorization of the Court to consummate the proposed
      assignment.  If the dispute is only about the cure amount,
      the company must pay to the party any undisputed portion
      of the proposed cure amount and place the disputed portion
      into a segregated interest-bearing account.  The party is
      entitled to payment from the segregated account of the
      disputed portion and interest earned upon the resolution
      by the Court of the dispute, or agreement between the
      company and the party.

  (8) Unless LBHI solicits bids from at least four potential
      assignees and selects the highest or best bid received,
      the company should obtain the consent of the Official
      Committee of Unsecured Creditors to assume and assign a
      derivative contract pursuant to the proposed protocol.

  (9) If no objection is timely served and the party as well
      as the Creditors Committee consents to the assignment,
      LBHI can assume and assign any derivative contract.  Upon
      the assumption and assignment, the assignee and any
      replacement credit support provider should assume the
      contract with all the defaults having been deemed cured or
      waived.

(10) After the assignment, LBHI should provide notice to the
      party of the effective date of the assignment.  Any
      purported termination notice sent by a party based on a
      default occurring prior to the assignment will be
      ineffective unless a termination notice is received by
      LBHI pursuant to the terms of the contract prior to the
      assignment.

(11) In case the derivative contract has been memorialized
      pursuant to a master agreement, LBHI may assume and assign
      pursuant to the proposed protocol, only all, but not fewer
      than all, of the derivative contract transactions entered
      into pursuant to the master agreement.

(12) As part of and to facilitate any assignment of the
      contract, LBHI may agree to make payments for the benefit
      of the assignee.

Meanwhile, LBHI proposed a protocol for the termination of the
derivative contract and the settlement of the claims resulting
from the termination:

  (a) With respect to any derivative contract, LBHI may enter
      into and execute a termination agreement.

  (b) A termination agreement may resolve and fix amounts
      owing between LBHI and the party.

  (c) In connection with any termination agreement, LBHI is
      authorized but not required to provide a release to the
      party.

  (4) A termination agreement may address and permit the
      collateral or margin held by LBHI or by the party to be
      liquidated or returned in accordance with the derivative
      contract, an applicable master netting agreement or the
      termination agreement.

                       About Lehman Brothers

Lehman Brothers Holdings Inc. -- http://www.lehman.com-- was the
fourth largest investment bank in the United States.  For more
than 150 years, Lehman Brothers led 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 offered 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 Sept. 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.

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

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.

On Sept. 19, 2008, the Honorable Gerard E. Lynch, Judge of the
United States District Court for the Southern District of New
York, entered an order commencing liquidation of Lehman Brothers,
Inc., pursuant to the provisions of the Securities Investor
Protection Act in the case captioned Securities Investor
Protection Corporation v. Lehman Brothers Inc., Case No. 08-CIV-
8119 (GEL).  James W. Giddens has been appointed as trustee for
the SIPA liquidation of the business of LBI

Barclays Bank Plc has agreed, subject to U.S. Court and relevant
regulatory approvals, to acquire Lehman Brothers' North American
investment banking and capital markets operations and supporting
infrastructure for US$1.75 billion.  Nomura Holdings Inc., the
largest brokerage house in Japan, on Sept. 22 reached an agreement
to purchased Lehman Brothers Holdings, Inc.'s operations in Europe
and the Middle East less than 24 hours after it reached a deal to
buy Lehman's operations in the Asia Pacific for US$225 million.
Nomura paid only $2 dollars for Lehman's investment banking and
equities businesses in Europe, but agreed to retain most of
Lehman's employees.

              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 Sept. 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 Sept. 16.  The
two units of Lehman Brothers Holdings, Inc., which has 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.

(Lehman Brothers Bankruptcy News, Issue No. 12; Bankruptcy
Creditors' Service, Inc., <http://bankrupt.com/newsstand/>or
215/945-7000).


LEHMAN BROTHERS: Disposition of Trade Confirmations Approved
------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
approved the assumption or rejection, as applicable, of so-called
open trade confirmations for companies that did not object or
whose objections had either been overruled or settled with Lehman
Brothers Holdings, Inc.

The Court will convene a hearing on Jan. 14, to consider the
objections of these companies:

  * Deutsche Bank
  * AIB International Finance
  * Putnam Investments
  * P. Schoenfeld Asset Management
  * Bank of America, N.A.
  * Field Point IV S.a.r.l.
  * Morgan Stanley Bank International Limited
  * Tennenbaum Opportunities Partners V, L.P.
  * Special Value Expansion Fund, LLC,
  * Special Value Opportunities Fund, LLC
  * H/2 Credit Partners
  * Goldman Sachs
  * KKR Investors (2006) (Ireland) L.P.
  * Lloyds TSB
  * Citigroup Inc.
  * Whippoorwill Associates Inc.
  * JP Morgan Chase
  * AXA Mezzanine II AS, SICAR
  * MD Mezzanine SA, SICAR
  * Blue Mountain Credit Alternatives Master Fund L.P.
  * Fir Tree Capital Opportunity Master Fund LP
  * Fir Tree Value Master Fund LP
  * Evergreen Investment Management Company LLC
  * Wachovia Bank, N.A.
  * M&G Investment Management Limited

Deutsche Bank, et al., said the Motion strips them of their
rights to set-off any claim they have against Lehman Brothers
Holdings, that the assumption of the contracts might result on
financial losses on their part, among other reasons.

                     Proposed Procedures

Before their bankruptcy filing, LBHI and its affiliated debtors
purchased and sold par and distressed commercial loans that were
reflected in oral and written trade confirmations.  Each Trade
Confirmation represented a binding agreement to purchase or sell
positions in par or distressed loans, participations in par or
distressed loans, or claims against third parties at an agreed
upon price.  Those transactions were generally consummated and
settled over the next several weeks upon execution by both parties
of formal transfer documentation and payment by the purchaser of
the applicable purchase price.

The Debtors had entered into, but had not consummated and
settled, hundreds of Trade Confirmations, many of which remain
pending.  The Open Trade Confirmations are subject to assumption
or rejection under Section 365 of the Bankruptcy Code.

Certain counterparties to Lehman Commercial Paper Inc.'s Open
Trade Confirmations filed a motion to compel assumption or
rejection of those Open Trade Confirmations prior to November 7,
2008.  Though Lehman Brothers Holdings Inc., was not a subject to
the Motion, many parties to Open Trade Confirmations with LBHI
have requested that LBHI also make a prompt determination
regarding the treatment of its Open Trade Confirmations.

The Debtors subsequently entered into a Stipulation and Agreed
Order with the Counterparties in which the Debtors agreed to (i)
notify the Counterparties on the Debtors' decision to those Open
Trade Confirmations by November 7, 2008; and (ii) file a motion
to assume, assume and assign, or reject those Open Trade
Confirmations on or before November 16, 2008 with a proposed
hearing date on December 3, 2008.

On November 4, 2008, the Debtors, however, determined that they
need additional time with respect to 49 Open Trade Confirmations.
Accordingly, the Debtors and the Counterparties entered into a
Court-approved revised stipulation wherein the Debtors would have
additional time to determine how their treatment to the Second
Group of Trades.  Accordingly, the Debtors will notify the
Counterparties as to their decision on the Second Group of Trades
on or before December 5, 2008 and file a related motion on or
before December 15, 2008 to be heard on January 14, 2009.

The Debtors, accordingly, asked the Court to approve their:

  (i) assumption of 400 + Open Trade Confirmations;

(ii) rejection of 150+  Open Trade Confirmations; and

(iii) modification and assumption of 70+ Open Trade
      Confirmations.

None of the Debtors is in monetary default under any Assumed or
Amended Trade.  Thus the Debtors further ask the Court to find
that there are no cure amounts due to any of those Trades and
that the Debtor have provided adequate assurance of future
performance.

The Debtors reason that since most of the Assumed Trades were
entered into during the period from April through mid-September
2008, the terms of those trade confirmations are more favorable
compared to the terms of the current market. The Debtors will
realize a greater recovery as a result of assumption of the
Assumed Trades than they would through sale of those loan
positions on the open market based on the current markets.

As to the Rejected Trades which the Debtors act as buyers, the
Debtors can likely purchase loan positions at significantly lower
prices than the market prices that existed prepetition.  The
Debtors are engaged in an orderly liquidation of their business
and have no need for some loan inventory acquired under the
Rejected Trades.  The Rejected Trades are out of the money thus
they cannot be assumed and assigned to a third party for a
profit.

The Amended Trades are comprised of buy trades which the Debtors
have been able to negotiate consensual modifications to reduce
the price payable by the applicable Debtor.  The Amended Trades
makes sense from a Counterparty's point of view because the
Counterparty is selling at a price that is lower than the amount
in the Original Trade Confirmation yet greater than today's
market price.  Moroever, the Debtors need the inventory of the
Amended Trades to complete open "sell" trades, and though they
may be paying slightly more than the current market price, the
Debtors are being relieved of the rejection damage claims that
might result should the Amended Trades be rejected.  Accordingly,
the Debtors believe that the Amended Trades represents net value
to the Debtors' estates.

The Debtors anticipate that Counterparties may seek to assert
setoff rights upon settlement of the Assumed Trades.  If a setoff
is permitted, a substantial portion of the benefit to be derived
from the Assumed Trades might be lost, the Debtors point out.
Rejection of the Rejected Trades will create a prepetition
unsecured claim against the Debtors.  In stark contrast, the
effect of assumption of the Assumed Trades under Section 365(a)
is to require the Counterparty to perform its obligations on a
postpetition basis.  Thus, any purported exercise of a right of
setoff would entail the setoff of a prepetition unsecured claim
owed by the Debtor against a prepetition claim owed by the
Counterparty to the Debtor.

Accordingly, the Debtors ask the Court to confirm that no
Counterparty will be entitled to assert or effectuate a right to
setoff any prepetition claim that it might have against the
Debtors, including claims for damages arising from the rejection
of a Rejected Trade, against any obligation to the Debtors under
any Assumed Trade or Amended Trade.  In the event that the Court
determines that a setoff is permissible, the Debtors reserve
their rights to review the Trades accordingly and to make
revisions as deemed necessary.

To the extent that parties to Rejected Trades indicate that they
are prepared to make modifications to their Open Trade
Confirmations, the Debtors reserve the right to make the
necessary changes.

                      LBHI, THL Stipulate

Lehman Brothers Holdings signed a stipulation with THL Nortek
(Luxembourg) Sarl and THL Credit Partners to resolve their
objection to the proposed assumption of their contract.

The stipulation, which was already approved by the Court,
provides for the termination of the contract and the withdrawal
of the companies' prior objection.  Lehman Brothers Holdings and
the companies also agreed under the stipulation to release each
other from all claims resulting from the execution and
termination of the contract.

                 LBHI Files Additional Request

Lehman Brothers Holdings sought court approval to assume
additional open trade confirmations:

Units   Deal Name                  Customer          Trade Date
-----   ---------            ----------------------  ----------
LCPI    ARINC Incorporated   Fusion Funding Limited   08/07/08

LCPI    Arvinmertior Inc.    Fusion Funding Limited   08/07/08

LCPI    Berry Plastics       Fusion Funding Limited   08/07/08
       A&R ABL

LCPI    Metavante            Fusion Funding Limited   08/07/08
       Corporation

LCPI    Rent-A-Center Inc.   Fusion Funding Limited   08/07/08
       2nd A&R 7-13-.06

LCPI    TXU Energy(10/10/07) Fusion Funding Limited   07/29/08
       CITI (B-1)

LCPI    Llondellbasell       Fusion Funding Limited   08/07/08
       Industries,
       CITI - 12/20/207

LCPI    Capmark Financial    Knighthead Master Fund   09/03/08
      (5-Year Japanese Term)

LCPI    Capmark Financial    Knighthead Master Fund   09/10/08
      (5-Year Japanese Term)

LCPIUK  Givaudan SA          Dresdner Bank AG, London 09/04/08
                            Branch

A hearing to consider approval of the proposed assumption is
scheduled for Jan. 14.  Creditors and other concerned parties
have until Jan. 9 to file their objections.

                       About Lehman Brothers

Lehman Brothers Holdings Inc. -- http://www.lehman.com-- was the
fourth largest investment bank in the United States.  For more
than 150 years, Lehman Brothers led 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 offered 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 Sept. 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.

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

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.

On Sept. 19, 2008, the Honorable Gerard E. Lynch, Judge of the
United States District Court for the Southern District of New
York, entered an order commencing liquidation of Lehman Brothers,
Inc., pursuant to the provisions of the Securities Investor
Protection Act in the case captioned Securities Investor
Protection Corporation v. Lehman Brothers Inc., Case No. 08-CIV-
8119 (GEL).  James W. Giddens has been appointed as trustee for
the SIPA liquidation of the business of LBI

Barclays Bank Plc has agreed, subject to U.S. Court and relevant
regulatory approvals, to acquire Lehman Brothers' North American
investment banking and capital markets operations and supporting
infrastructure for US$1.75 billion.  Nomura Holdings Inc., the
largest brokerage house in Japan, on Sept. 22 reached an agreement
to purchased Lehman Brothers Holdings, Inc.'s operations in Europe
and the Middle East less than 24 hours after it reached a deal to
buy Lehman's operations in the Asia Pacific for US$225 million.
Nomura paid only $2 dollars for Lehman's investment banking and
equities businesses in Europe, but agreed to retain most of
Lehman's employees.

              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 Sept. 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 Sept. 16.  The
two units of Lehman Brothers Holdings, Inc., which has 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.

(Lehman Brothers Bankruptcy News, Issue No. 12; Bankruptcy
Creditors' Service, Inc., <http://bankrupt.com/newsstand/>or
215/945-7000).


LEHMAN BROTHERS: Seeks to Extend Time to Decide on Leases
---------------------------------------------------------
Lehman Brothers Holdings, Inc., asks the U.S. Bankruptcy Court
for the Southern District of New York to extend its deadline to
assume or reject its leases for nonresidential real properties to
April 13, 2009.

The current deadline expires January 13, 2009.

"In light of the unprecedented size, complexity and demands of
these cases, it would be unreasonable or unrealistic to require
[Lehman Brothers Holdings] to make final determinations regarding
the assumption or rejection of all of the leases," Lori Fife,
Esq., at Weil Gotshal & Manges, in New York, said in court
papers.

Lehman Brothers currently has unexpired leases for nonresidential
real properties, one co-location agreement and one service
agreement with these companies:

Lessor                           Address
------                           -------
Historic TW Inc.                 111 West 50th Street
                                 New York, New York,

Rockefeller Center North Inc.    111 West 50th Street
                                 New York, New York

600 Partners Co., L.P.           600 Madison Avenue
                                 New York, New York

85 Tenth Avenue Associates       85 Tenth Avenue
                                 New York, New York

DBSI Housing, Inc.               6666 East 75th Street
                                 Indianapolis, Indiana

101 Hudson Leasing Associates    101 Hudson Street
                                 Jersey City, New Jersey

AIG Technologies, Inc.           2 Peachtree Hill Road
                                 Livingston, New Jersey

Texas Tower Limited              600 Travis Street
                                 Houston, Texas

The Irvine Company LLC           680 Newport Center Dr.
                                 Suite 150, Newport Beach
                                 California

Hanover Moving & Storage Co.     50 Dey Street
                                 Jersey City, New Jersey

Ms. Fife said that as part of the asset purchase agreement
entered into between Lehman Brothers and Barclays Capital Inc.,
the bankrupt company agreed to maintain the availability of
certain locations for use by its former personnel who are now
working with the U.K. bank for nine months after the contract's
closing date.

She said that Lehman Brothers may be forced to assume some of the
leases to fulfill its obligations under the asset purchase
agreement without the extension.

"Such assumption is disadvantageous because once the nine month
period has expired, [Lehman Brothers Holdings] may have no
further use for such premises," Ms. Fife pointed out.
"Similarly, if forced to make assumption or rejection decisions
at this early stage with respect to the leases not covered by the
[asset purchase agreement], the decision would be premature."

Ms. Fife further said that counterparties to the leases would not
be prejudiced by the proposed extension since Lehman Brothers
Holdings is current on all "post-petition" payments and other
obligations under the lease contracts.

A hearing to consider approval of the proposed extension is
scheduled for Jan. 14, 2009.  Creditors and other concerned
parties have until Jan. 9, 2009 to file their objections.

                  LBI Also Seeks Extension

James Giddens, trustee for Lehman Brothers Inc., sought and
obtained court approval to make decisions on executory contracts
and unexpired leases pursuant to Section 365(d)(1) of the
Bankruptcy Code until March 18, 2009.

The deadline previously approved by the U.S. Bankruptcy Court for
the Southern District of New York expired on Dec. 18.

Mr. Giddens said in court papers that the proposed extension,
pursuant to Section 365(d)(1) of the Bankruptcy Code, would give
him enough time to determine whether the assumption and
assignment of the contracts and unexpired leases would be
beneficial to LBI.

"Counterparties will not be prejudiced by this further extension
aws their rights to seek an order to shorten the trustee's time
to assume or reject any particular executory contract or
unexpired lease will be preserved," the court filing said.

The assumption or rejection of the contracts and unexpired leases
is part of the agreement between Lehman Brothers Holdings and
Barclays Capital for the sale of LBI.

Mr. Giddens filed another request to extend pursuant to Section
365(d)(4) of the Bankruptcy Code, James Giddens, trustee for
Lehman Brothers Inc., his deadline assume or reject five leases
for nonresidential real properties.  Mr. Giddens wants the
deadline extended to April 17 from Jan. 17.

                       About Lehman Brothers

Lehman Brothers Holdings Inc. -- http://www.lehman.com-- was the
fourth largest investment bank in the United States.  For more
than 150 years, Lehman Brothers led 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 offered 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 Sept. 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.

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

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.

On Sept. 19, 2008, the Honorable Gerard E. Lynch, Judge of the
United States District Court for the Southern District of New
York, entered an order commencing liquidation of Lehman Brothers,
Inc., pursuant to the provisions of the Securities Investor
Protection Act in the case captioned Securities Investor
Protection Corporation v. Lehman Brothers Inc., Case No. 08-CIV-
8119 (GEL).  James W. Giddens has been appointed as trustee for
the SIPA liquidation of the business of LBI

Barclays Bank Plc has agreed, subject to U.S. Court and relevant
regulatory approvals, to acquire Lehman Brothers' North American
investment banking and capital markets operations and supporting
infrastructure for US$1.75 billion.  Nomura Holdings Inc., the
largest brokerage house in Japan, on Sept. 22 reached an agreement
to purchased Lehman Brothers Holdings, Inc.'s operations in Europe
and the Middle East less than 24 hours after it reached a deal to
buy Lehman's operations in the Asia Pacific for US$225 million.
Nomura paid only $2 dollars for Lehman's investment banking and
equities businesses in Europe, but agreed to retain most of
Lehman's employees.

              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 Sept. 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 Sept. 16.  The
two units of Lehman Brothers Holdings, Inc., which has 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.

(Lehman Brothers Bankruptcy News, Issue No. 12; Bankruptcy
Creditors' Service, Inc., <http://bankrupt.com/newsstand/>or
215/945-7000).


LEHMAN BROTHERS: Wants Schedules Filing Deadline Moved to March 16
------------------------------------------------------------------
Judge James Peck of the U.S. Bankruptcy Court for the Southern
District of New York issued a bridge order extending the deadline
for Lehman Brothers Holdings, Inc., to file its schedules of
assets and liabilities, and statement of financial affairs "until
such time as the court has entered an order determining the
motion."

Lehman Brothers Holdings is seeking a March 16, 2009 extension of
its filing deadline.

Lehman Brothers informed the Court that it may not be able to
complete the financial documents until Jan. 13, 2009, the deadline
the court previously set for filing the documents, since the
Debtor is still consolidating the information needed to prepare
the documents.  The company cited instances which prevented the
completion of the documents including the sales of its business,
the insolvency of its foreign units, among other things.

A hearing to consider approval of the proposed extension is
scheduled for Jan. 14, 2009.  Creditors and other concerned
parties have until Jan. 9, 2009 to file their objections.

                       About Lehman Brothers

Lehman Brothers Holdings Inc. -- http://www.lehman.com-- was the
fourth largest investment bank in the United States.  For more
than 150 years, Lehman Brothers led 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 offered 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 Sept. 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.

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

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.

On Sept. 19, 2008, the Honorable Gerard E. Lynch, Judge of the
United States District Court for the Southern District of New
York, entered an order commencing liquidation of Lehman Brothers,
Inc., pursuant to the provisions of the Securities Investor
Protection Act in the case captioned Securities Investor
Protection Corporation v. Lehman Brothers Inc., Case No. 08-CIV-
8119 (GEL).  James W. Giddens has been appointed as trustee for
the SIPA liquidation of the business of LBI

Barclays Bank Plc has agreed, subject to U.S. Court and relevant
regulatory approvals, to acquire Lehman Brothers' North American
investment banking and capital markets operations and supporting
infrastructure for US$1.75 billion.  Nomura Holdings Inc., the
largest brokerage house in Japan, on Sept. 22 reached an agreement
to purchased Lehman Brothers Holdings, Inc.'s operations in Europe
and the Middle East less than 24 hours after it reached a deal to
buy Lehman's operations in the Asia Pacific for US$225 million.
Nomura paid only $2 dollars for Lehman's investment banking and
equities businesses in Europe, but agreed to retain most of
Lehman's employees.

              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 Sept. 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 Sept. 16.  The
two units of Lehman Brothers Holdings, Inc., which has 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.

(Lehman Brothers Bankruptcy News, Issue No. 12; Bankruptcy
Creditors' Service, Inc., <http://bankrupt.com/newsstand/>or
215/945-7000).


LEHMAN BROTHERS: Kamco May Purchase Japanese Distressed Assets
--------------------------------------------------------------
Korea Asset Management Corp. is considering acquiring part of
Lehman Brothers Holdings' JPY500 billion (US$5.5 billion) in
Japanese distressed assets, according to a report by Bloomberg
dated Dec. 12.

"Lehman's Japan assets have high investment value.  The asset
values are expected to rise in the future" Bloomberg quoted Lee
Chol Hwi, Kamco's Chief Executive Officer, as saying.

No official talks have begun with Lehman Brothers Holdings.  Yi
Kyung Ju, Kamco's spokesman told Bloomberg that weaker Korean won
against foreign currencies including the yen serves as a
difficulty in any acquisition.

Mo Jae Sung, who helps manage almost $1 billion at Hanwha
Investment Trust Management Co. in Seoul, commented that Kamco
should have been focusing on the local market right now amid
concerns of growing bad assets.  "Still, it's understandable that
Kamco would want to take advantage of opportunities to buy cheap
overseas assets," Bloomberg quoted him as saying.

Kamco, a specialist buyer of delinquent loans, spent 39.3
trillion won to buy distressed assets with a face value of 111
trillion won in South Korea since the 1997-1998 financial crisis.
It made its first overseas investment in December 2007, leading a
group of South Korean companies in buying 133.4 billion won worth
of bad debts in China.

                       About Lehman Brothers

Lehman Brothers Holdings Inc. -- http://www.lehman.com-- was the
fourth largest investment bank in the United States.  For more
than 150 years, Lehman Brothers led 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 offered 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 Sept. 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.

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

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.

On Sept. 19, 2008, the Honorable Gerard E. Lynch, Judge of the
United States District Court for the Southern District of New
York, entered an order commencing liquidation of Lehman Brothers,
Inc., pursuant to the provisions of the Securities Investor
Protection Act in the case captioned Securities Investor
Protection Corporation v. Lehman Brothers Inc., Case No. 08-CIV-
8119 (GEL).  James W. Giddens has been appointed as trustee for
the SIPA liquidation of the business of LBI

Barclays Bank Plc has agreed, subject to U.S. Court and relevant
regulatory approvals, to acquire Lehman Brothers' North American
investment banking and capital markets operations and supporting
infrastructure for US$1.75 billion.  Nomura Holdings Inc., the
largest brokerage house in Japan, on Sept. 22 reached an agreement
to purchased Lehman Brothers Holdings, Inc.'s operations in Europe
and the Middle East less than 24 hours after it reached a deal to
buy Lehman's operations in the Asia Pacific for US$225 million.
Nomura paid only $2 dollars for Lehman's investment banking and
equities businesses in Europe, but agreed to retain most of
Lehman's employees.

              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 Sept. 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 Sept. 16.  The
two units of Lehman Brothers Holdings, Inc., which has 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.

(Lehman Brothers Bankruptcy News, Issue No. 12; Bankruptcy
Creditors' Service, Inc., <http://bankrupt.com/newsstand/>or
215/945-7000).


LEHMAN BROTHERS: Court OKs Sale of Aircraft to Pegasus & Peregrine
------------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
issued an amended order authorizing Lehman Brothers Holdings to
sell the aircraft to Pegasus AV for $23,400,000.

The aircraft, a Gulfstream Aerospace G-IVSP, was supposed to be
sold for $24,892,000 to Pegasus pursuant to the Court's prior
order dated Nov. 5.  Pegasus, however, reportedly refused to
consummate the sale due to the decline in the market value of the
aircraft.  Consequently, Lehman Brothers Holdings and Pegasus
agreed that the purchase price for the aircraft be reduced by
about $1,500,000 to $23,400,000, and that the deposit be
increased from $250,000 to $2,250,000.

The Bankruptcy Court, in a separate order, also issued an order
authorizing CES Aviation IX LLC, to sell the aircraft to Peregrine
Aviation Systems for $5,900,000.

The aircraft, a Dassault model Falcon 50, was supposed to be sold
to Peregrine for $6,200,000.  During final inspections, however,
the aircraft was found out to not to be in compliance with the
regulations for charter service in Europe, which is a condition
to Peregrine's obligation to consummate the proposed sale as
provided in the agreement between the companies.  Consequently,
CES Aviation accepted the offer of Peregrine to acquire the
aircraft "as is," but in a reduced purchase price of $5,900,000.

                       About Lehman Brothers

Lehman Brothers Holdings Inc. -- http://www.lehman.com-- was the
fourth largest investment bank in the United States.  For more
than 150 years, Lehman Brothers led 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 offered 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 Sept. 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.

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

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.

On Sept. 19, 2008, the Honorable Gerard E. Lynch, Judge of the
United States District Court for the Southern District of New
York, entered an order commencing liquidation of Lehman Brothers,
Inc., pursuant to the provisions of the Securities Investor
Protection Act in the case captioned Securities Investor
Protection Corporation v. Lehman Brothers Inc., Case No. 08-CIV-
8119 (GEL).  James W. Giddens has been appointed as trustee for
the SIPA liquidation of the business of LBI

Barclays Bank Plc has agreed, subject to U.S. Court and relevant
regulatory approvals, to acquire Lehman Brothers' North American
investment banking and capital markets operations and supporting
infrastructure for US$1.75 billion.  Nomura Holdings Inc., the
largest brokerage house in Japan, on Sept. 22 reached an agreement
to purchased Lehman Brothers Holdings, Inc.'s operations in Europe
and the Middle East less than 24 hours after it reached a deal to
buy Lehman's operations in the Asia Pacific for US$225 million.
Nomura paid only $2 dollars for Lehman's investment banking and
equities businesses in Europe, but agreed to retain most of
Lehman's employees.

              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 Sept. 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 Sept. 16.  The
two units of Lehman Brothers Holdings, Inc., which has 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.

(Lehman Brothers Bankruptcy News, Issue No. 12; Bankruptcy
Creditors' Service, Inc., <http://bankrupt.com/newsstand/>or
215/945-7000).


LEHMAN BROTHERS: Assumes Admin. Services Contract with Aetna
-----------------------------------------------------------
Lehman Brothers Holdings, Inc., obtained approval from the U.S.
Bankruptcy Court for the Southern District of New York to assume
an administrative services agreement with Aetna Life Insurance
Company.

The agreement allows Lehman Brothers Holdings to avail of Aetna's
services, which enable the bankrupt company to offer health and
medical coverage for its employees.

Attorney for Lehman Brothers Holdings, Richard Krasnow, Esq., at
Weil Gotshal & Manges, in New York, said the assumption of the
administrative services agreement would permit Aetna to continue
processing those medical claims incurred under the agreement
until Dec. 31.

Mr. Krasnow said that the proposed assumption would also avoid
any interruption in providing medical coverage to its employees
that may result from the company's decision to sign a new
agreement with Aetna.

Lehman Brothers Holdings is currently in talks with Aetna to
enter into an insurance agreement that would cover the bankrupt
company's prescription drug program as well as provide health and
medical coverage to its employees.

The bankrupt company made the decision in light with the
significant reduction of its workforce, which reportedly made its
self-funded program no longer cost-efficient for the company.

Under the insurance agreement, Aetna would still continue to
provide administrative services through third-party contractors
for claims incurred after Jan. 1, 2009, for no additional fee.
The agreement, however, would not include coverage by Aetna for
claims incurred this year, including those incurred under the
administrative services agreement.

                       About Lehman Brothers

Lehman Brothers Holdings Inc. -- http://www.lehman.com-- was the
fourth largest investment bank in the United States.  For more
than 150 years, Lehman Brothers led 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 offered 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 Sept. 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.

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

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.

On Sept. 19, 2008, the Honorable Gerard E. Lynch, Judge of the
United States District Court for the Southern District of New
York, entered an order commencing liquidation of Lehman Brothers,
Inc., pursuant to the provisions of the Securities Investor
Protection Act in the case captioned Securities Investor
Protection Corporation v. Lehman Brothers Inc., Case No. 08-CIV-
8119 (GEL).  James W. Giddens has been appointed as trustee for
the SIPA liquidation of the business of LBI

Barclays Bank Plc has agreed, subject to U.S. Court and relevant
regulatory approvals, to acquire Lehman Brothers' North American
investment banking and capital markets operations and supporting
infrastructure for US$1.75 billion.  Nomura Holdings Inc., the
largest brokerage house in Japan, on Sept. 22 reached an agreement
to purchased Lehman Brothers Holdings, Inc.'s operations in Europe
and the Middle East less than 24 hours after it reached a deal to
buy Lehman's operations in the Asia Pacific for US$225 million.
Nomura paid only $2 dollars for Lehman's investment banking and
equities businesses in Europe, but agreed to retain most of
Lehman's employees.

              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 Sept. 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 Sept. 16.  The
two units of Lehman Brothers Holdings, Inc., which has 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.

(Lehman Brothers Bankruptcy News, Issue No. 12; Bankruptcy
Creditors' Service, Inc., <http://bankrupt.com/newsstand/>or
215/945-7000).


LEHMAN BROTHERS: Gets Approval to Reject Drug Program with Medco
----------------------------------------------------------------
Lehman Brothers Holdings, Inc., obtained approval from the U.S.
Bankruptcy Court for the Southern District of New York to reject
its prescription drug program master agreement with Medco Health
Solutions effective Dec. 31.

Lehman Brothers Holdings signed the agreement to avail of the
products and services of Medco and its network of prescription
drug providers for the company 's drug program.  The actual
prescription drug claims are being paid directly by Lehman
Brothers Holdings through a reimbursement mechanism.

Attorney for Lehman Brothers Holdings, Richard Krasnow of Weil
Gotshal & Manges, in New York, said that the company's self-
funded drug program is no longer cost-efficient in light with the
significant reduction of its workforce.

"The agreement is no longer cost-efficient and exposes [Lehman
Brothers Holdings] to unnecessary risk of potentially substantial
claims that would be directly payable if [Lehman Brothers
Holdings] continued to operate under a self-funded program," Mr.
Krasnow said in a court filing.

Mr. Krasnow disclosed that the bankrupt company is in talks with
Aetna Life Insurance Company to enter into an insurance agreement
that would cover the bankrupt company's prescription drug program
and provide health and medical coverage as well.

"By combining its medical and prescription drug coverage to a
single provider, [Lehman Brothers Holdings] will be able to
reduce the administrative burdens and costs to its estate," Mr.
Krasnow said.

Under the insurance agreement, Lehman Brothers Holdings proposed
only to pay a monthly premium to Aetna.  The cost of the
prescription drug claims would be shouldered by Aetna.

                       About Lehman Brothers

Lehman Brothers Holdings Inc. -- http://www.lehman.com-- was the
fourth largest investment bank in the United States.  For more
than 150 years, Lehman Brothers led 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 offered 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 Sept. 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.

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

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.

On Sept. 19, 2008, the Honorable Gerard E. Lynch, Judge of the
United States District Court for the Southern District of New
York, entered an order commencing liquidation of Lehman Brothers,
Inc., pursuant to the provisions of the Securities Investor
Protection Act in the case captioned Securities Investor
Protection Corporation v. Lehman Brothers Inc., Case No. 08-CIV-
8119 (GEL).  James W. Giddens has been appointed as trustee for
the SIPA liquidation of the business of LBI

Barclays Bank Plc has agreed, subject to U.S. Court and relevant
regulatory approvals, to acquire Lehman Brothers' North American
investment banking and capital markets operations and supporting
infrastructure for US$1.75 billion.  Nomura Holdings Inc., the
largest brokerage house in Japan, on Sept. 22 reached an agreement
to purchased Lehman Brothers Holdings, Inc.'s operations in Europe
and the Middle East less than 24 hours after it reached a deal to
buy Lehman's operations in the Asia Pacific for US$225 million.
Nomura paid only $2 dollars for Lehman's investment banking and
equities businesses in Europe, but agreed to retain most of
Lehman's employees.

              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 Sept. 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 Sept. 16.  The
two units of Lehman Brothers Holdings, Inc., which has 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.

(Lehman Brothers Bankruptcy News, Issue No. 12; Bankruptcy
Creditors' Service, Inc., <http://bankrupt.com/newsstand/>or
215/945-7000).


LEHMAN BROTHERS: Court Approves Retention of Professionals
----------------------------------------------------------
Lehman Brothers Holdings obtained final court approval to employ
Alvarez & Marsal North America, with Bryan Marsal as its chief
restructuring officer, effective as of Sept. 15.

The U.S. Bankruptcy Court for the Southern District of New York
also approved the retention of:

  -- Bloomer de Vere Group Avia as LBHI's broker effective Sept.
     15, in connection with the sale of its aircraft and other
     assets held by Ces Aviation, a subsidiary.

  -- Bortstein Legal as LBHI's special counsel.

  -- McKenna Long & Aldridge as special counsel of LBHI, effective
     as of Sept. 15.

  -- Lazard Freres & Co., as LBHI's investment banker effective as
     of Sept. 15.

  -- Natixis Capital Markets as strategic adviser of LBHI.

  -- Houlihan Lokey Howard & Zukin Capital as investment banker of
     the official committee of unsecured creditors of LBHI
     effective Sept. 17.

                    Lehman Wants E&Y As Auditor

Lehman Brothers Holdings, Inc., seeks approval from the Bankruptcy
Court to employ Ernst & Young LLP as its auditor and tax services
provider effective as of Sept. 15, 2008.

Lehman Brothers Holdings wants E&Y to:

  (1) provide routine tax advisory services;

  (2) provide tax consultation regarding the bankruptcy filing
      of Lehman Brothers Holdings and its units;

  (3) provide tax advice and controversy services concerning the
      issues in the examination of the bankrupt companies and
      their subsidiaries by the Internal Revenue Service for the
      year ending Dec. 31, 2007

  (4) review proofs of claim that may be filed by the IRS in the
      companies' bankruptcy cases, provide guidance and
      recommendations concerning the appropriateness of the
      claims, represent the companies before the IRS to resolve
      any claims and assist them in seeking expeditious
      consideration of any refund claim;

  (5) prepare amended state and local tax returns, as required,
      based on audit settlements with the IRS;

  (6) assist in preparing New York State Investment Tax Credit
      and Employment Incentive Credit Calculations for the 2007
      New York State tax returns including an analysis of
      qualified purchases and personnel by location;

  (7) prepare required tax returns for 2008 in various domestic
      and non-U.S. jurisdictions; and

  (8) audit and report on the consolidated financial statements
      of the companies for the year ended Nov. 30, 2008, audit
      and report on the effectiveness of their internal control
      over financial reporting as of Nov. 30, 2008, review the
      unaudited interim financial information before Lehman
      Brothers Holdings files its Form 10 Q, and issue a report
      to the Audit Committee that provides negative assurance as
      to conformity with U.S. generally accepted accounting
      principles.

In return for the services, Ernst & Young's personnel will be
paid at these hourly rates and will be reimbursed for any
expenses incurred:

                            Audit Services   Tax Services
                            --------------   ------------
Partners/Principals/
  Directors                    $625 - $800    $700 - $825
Senior Managers/Managers       $425 - $600    $650 - $725
Seniors/Staff                  $160 - $400    $160 - $450

In his affidavit filed with the Court, William Schlich, a partner
at Ernst & Young, said that his firm does not hold or represent
any interest materially adverse to Lehman Brothers Holdings and
its units in bankruptcy.

                       About Lehman Brothers

Lehman Brothers Holdings Inc. -- http://www.lehman.com-- was the
fourth largest investment bank in the United States.  For more
than 150 years, Lehman Brothers led 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 offered 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 Sept. 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.

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

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.

On Sept. 19, 2008, the Honorable Gerard E. Lynch, Judge of the
United States District Court for the Southern District of New
York, entered an order commencing liquidation of Lehman Brothers,
Inc., pursuant to the provisions of the Securities Investor
Protection Act in the case captioned Securities Investor
Protection Corporation v. Lehman Brothers Inc., Case No. 08-CIV-
8119 (GEL).  James W. Giddens has been appointed as trustee for
the SIPA liquidation of the business of LBI

Barclays Bank Plc has agreed, subject to U.S. Court and relevant
regulatory approvals, to acquire Lehman Brothers' North American
investment banking and capital markets operations and supporting
infrastructure for US$1.75 billion.  Nomura Holdings Inc., the
largest brokerage house in Japan, on Sept. 22 reached an agreement
to purchased Lehman Brothers Holdings, Inc.'s operations in Europe
and the Middle East less than 24 hours after it reached a deal to
buy Lehman's operations in the Asia Pacific for US$225 million.
Nomura paid only $2 dollars for Lehman's investment banking and
equities businesses in Europe, but agreed to retain most of
Lehman's employees.

              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 Sept. 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 Sept. 16.  The
two units of Lehman Brothers Holdings, Inc., which has 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.

(Lehman Brothers Bankruptcy News, Issue No. 12; Bankruptcy
Creditors' Service, Inc., <http://bankrupt.com/newsstand/>or
215/945-7000).


LEVEL 3: S&P Raises Corporate Credit Rating to 'B-' from 'SD'
-------------------------------------------------------------
Standard & Poor's Rating Services said it raised its corporate
credit rating on Level 3 Communications Inc. to 'B-' from 'SD'
(selective default).  The outlook is stable.

This action follows the company's recent completion of three
below-par debt tender offers that were viewed by Standard & Poor's
as distressed exchanges and resulted in a lowering of the
corporate credit rating to 'SD' on Dec. 29, 2008.  "With
completion of the tender offers," explained Standard & Poor's
credit analyst Susan Madison, "Level 3's near-term liquidity is
bolstered by the absence of material debt maturities over the next
year."  Another support for liquidity involves a cash balance of
about $640 million at Sept. 30, 2008, pro forma for the completion
of the debt tender offers and issuance of $400 million of new
notes.

Ratings on Level 3's 6% convertible subordinated notes due 2009,
6% convertible subordinated notes due 2010, and 2.875% convertible
senior notes due 2010 not tendered were raised to 'CCC' from 'D',
with a recovery rating of '6' on each issue, indicating
expectations for negligible (0%-10%) recovery in the event of a
payment default.

S&P affirmed the ratings on all other debt issued by Level 3
Communications, and its wholly owned subsidiary Level 3 Financing
Inc., and removed them from CreditWatch, where they were placed on
Nov. 18, 2008, following the company's announcement of the below-
par debt tender offers.  Standard & Poor's also assigned a 'CCC'
issue rating to $400 million of 15% convertible senior notes due
2013 that were issued to finance the tenders.  S&P also assigned a
'6' recovery rating to these notes, indicating expectations for
negligible (0%-10%) recovery in the event of a payment default.


LIFE FLIGHT: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: Life Flight of Puerto Rico Inc.
        PO Box 13638
        San Juan, PR 00908

Bankruptcy Case No.: 08-08870

Type of Business: The Debtor provides air ambulance services.

Chapter 11 Petition Date: December 24, 2008

Court: United States Bankruptcy Court
       District of Puerto Rico (Old San Juan)

Judge: Chief Judge Gerardo Carlo Altieri

Debtor's Counsel: Jose A. Cabiya Morales
                  Weinstein-Bacal & Miller PSC
                  154 Calle Rafael Cordero
                  Edif Gonzalez Padin Penthouse
                  San Juan, PR 00901
                  Tel.: (787)977-2550
                  Fax : (787)977-2559
                  Email: jcm@w-bmlaw.com

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

Estimated Debts: $500,001 to $1,000,000

A full-text copy of the Debtor's petition and a list of the
Debtor's largest unsecured creditors are available for free at:

        http://bankrupt.com/misc/prb08-08870.pdf

The petition was signed by Luis Raul Esteves, chief executive
officer of the company.


LITHIUM TECH: Files Financial Reports for March 31 & June 30 Qtrs.
------------------------------------------------------------------
Lithium Technology Corp. delivered to the Securities and Exchange
Commission its Form 10-Qs for the quarters ended March 31, 2008,
and June 30, 2008.

As of March 31, 2008, the company's balance sheet showed total
assets of $15,186,000 and total liabilities of $19,558,000,
resulting in total stockholders' deficit of $4,372,000.  As of
March 31, the company's working capital deficit was $13,528,000 as
compared to $25,444,000 on December 31, 2007. The company reported
net income of $3,521,000 for the three months ended March 31.

As of June 30, 2008, the company's balance sheet showed total
assets of $14,127,000 and total liabilities of $23,838,000
(consisting of all current liabilities), resulting in total
stockholders' deficit of $9,711,000.  As of June 30, the company's
working capital deficit was $18,698,000. The company posted a net
loss of $5,343,000 for the three months ended June 30. The company
expects to incur substantial operating losses as it continues its
commercialization efforts.

"Since inception, we have incurred substantial operating losses
and expect to incur additional operating losses over the next
several years. As of June 30, 2008, we had an accumulated deficit
of approximately $132,881,000. We have financed our operations
since inception primarily through equity financings, loans from
shareholders and other related parties, loans from silent partners
and bank borrowings secured by assets. We have recently entered
into a number of financing transactions and are continuing to seek
other financing initiatives. We will need to raise additional
capital to meet our working capital needs and to complete our
product commercialization process. Such capital is expected to
come from the sale of securities and debt financing. No assurances
can be given that such financing will be available in sufficient
amounts or at all. Continuation of our operations in the future is
dependent upon obtaining such further financing. These conditions
raise substantial doubt about our ability to continue as a going
concern," Chief Executive Officer Theo M. M. Kremers disclosed in
a regulatory filing.

A full-text copy of the company's quarterly reports for the period
ended March 31, 2008, is available for free at:

             http://researcharchives.com/t/s?3748

A full-text copy of the company's quarterly reports for the period
ended June 30, 2008, is available for free at:

             http://researcharchives.com/t/s?3747

                  About Lithium Technology Corp.

Lithium Technology Corp. is a global manufacturer of Li-ion cells
and a global provider of power solutions for diverse applications.
LTC is especially well positioned in the fast growing markets of
electrical cars and stationary power. The company expects results
to substantially improve in the near future.


LYONDELLBASELL: Inches Closer to Chapter 11 Bankruptcy
------------------------------------------------------
LyondellBasell Industries AF, may file for bankruptcy protection
in the next week or two, Bloomberg News reports, citing Societe
Generale SA.

"A Chapter 11 filing appears imminent," Nadia Yoshiyama, a
credit analyst at Societe Generale in London, said in a
report, according to Bloomberg.  "Considering the complexity of
the capital structure, the size of the required capital and the
speed with which a deal needs to be agreed, a restructuring
outside of bankruptcy is unlikely in our view."

The cost of protecting corporate bonds in a benchmark European
index climbed to a two-week high amid speculation chemicals-maker
LyondellBasell Industries AF will file for bankruptcy protection,
Bloomberg also reports.  Reuters said that the high-yield bonds of
petrochemicals firm LyondellBasell, dropped Jan. 5, while its
senior loans rallied in anticipation of a Chapter 11 filing.

LyondellBasell is about to name a reorganization expert as it
tries to avert insolvency, the London-based Times reported.

As reported by the Troubled Company Reporter, LyondellBasell
Industries AF SCA obtained permission from lenders to postpone
$280 million in payments due for the conversion of bridge loans
into extended loans until Jan. 4.

In connection with the Jan. 4 extension granted by lenders led by
Merrill Lynch, Pierce, Fenner & Smith Incorporated, Goldman Sachs
Credit Partners L.P., Citigroup Global Markets Inc., ABN AMRO
Incorporated and UBS Securities LLC, as joint lead arrangers and
bookrunners, the board has approved and is in the process of
retaining Kevin M. McShea of AlixPartners, LLP as chief
restructuring officer of LyondellBasell and its subsidiaries.  Mr.
McShea will serve as CRO effective upon our liquidity."

The company said Dec. 30 that it continues to work collaboratively
with the Lenders and other parties relating to the extension of
payment dates and the restructuring of its debt obligations.  The
company has also hired advisors to assist in evaluating its
strategic options, which include the possibility of filing for
protection under Chapter 11 of the U.S. Bankruptcy Code.

Reuters relates that a source close to the matter said that as the
Jan. 4 deadline passed without a statement from LyondellBasell, it
is possible that the negotiation process has been delayed
slightly.

                     About LyondellBasell

LyondellBasell Industries -- http://www.lyondellbasell.com/-- is
a refiner of crude oil; a significant producer of gasoline
blending components; a global manufacturer of chemicals and
polymers, including polyolefins and advanced polyolefins; and the
leading developer and licensor of technologies for the production
of polymers.

Following the acquisition of Lyondell in 2007, LyondellBasell
became the world's largest independent producer of polypropylene
and advanced polyolefins products, a leading supplier of
polyethylene, and a global leader in the development and licensing
of polypropylene and polyethylene processes and related catalyst
sales.  The group is estimated to generate 2007 revenues of US$44
billion and EBITDA of US$4.1 billion reflecting strong performance
of Lyondell and Basell businesses at the top of the cycle.

As reported by the Troubled Company Reporter on Nov. 18, 2008,
Moody's Investors Service downgraded the Corporate Family Rating
of LyondellBasell Industries AF SCA to B3 from B1.  The ratings on
the first lien facilities have been downgraded to B1/ LGD 2(27)
and the ratings on the legacy notes of Basell and Lyondell have
been downgraded to Caa2, with various LGD rates.  LBI has
rearranged its USD 8 billion second lien facility into
US$5.5 billion second lien facilities and USD 2.5 billion third
lien facility.  The new facilities have been rated Caa1/ LGD 5
(73) and Caa2/ LGD 5 (86) respectively.  The outlook on the
ratings remains negative.

As reported by the TCR Europe on Nov. 26, 2008, Fitch Ratings
downgraded Netherlands-based petrochemicals company Lyondell
Basell Industries AF SCA's Long-term Issuer Default rating to 'B-
'(B minus) from 'B+' while maintaining a Negative Outlook.  At the
same time, Fitch affirmed LBI's Short-term IDR at 'B'.

Lyondell disclosed in its latest quarterly results that it has
$27.12 billion in assets and $228 million stockholders' deficit as
of Sept. 30, 2008.  It incurred a $232 million net loss in the
three months ended Sept. 30, 2008, compared to a $206 million net
profit during the same period in 2007.


LYONDELLBASELL: Default Swaps Rise on Bankruptcy Speculations
-------------------------------------------------------------
Bloomberg's Shannon D. Harrington and Neil Unmack report that
credit default swaps on the Markit iTraxx Crossover Index of 50
European companies, including LyondellBasell Industries AF,
reached the highest since Dec. 19 amid speculation LyondellBasell
will file for bankruptcy protection.  Bloomberg says that,
according to CMA Datavision, the iTraxx Crossover index, which
includes companies with mostly high-risk, high-yield ratings, rose
four basis points to 1,041.5 basis points.

"Contracts tied to Rotterdam-based LyondellBasell traded at levels
pricing in almost certain odds of a default in the next year,"
Bloomberg says.

Bloomberg explains that the index, used to hedge against losses or
to speculate on the ability of companies to repay their debt,
rises as investor confidence deteriorates and fall as it improves.
The contracts, Bloomberg says, pay the buyer face value if a
company defaults in exchange for the underlying securities or the
cash equivalent.  A basis point on a credit-default swap contract
protecting $10 million of debt from default for five years is
equivalent to $1,000 a year, the report notes.

Messrs. Harrington and Unmack say swaps on LyondellBasell are
trading at levels that have priced in about 90% odds of a default
in the next year,
according to CMA data.  "The contracts rose 2.5 percentage points
to 87.5 percentage points upfront.  That's in addition to 5
percentage points a year and means it would cost 8.75 million
euros ($11.9 million) initially and 500,000 euros a year to
protect 10 million euros of LyondellBasell bonds for five years,"
they say.

Nadia Yoshiyama, a Societe Generale SA analyst based in London, in
a report Monday, said LyondellBasell may file for bankruptcy
protection in the next week or two, Bloomberg adds.

LyondellBasell is saddled with debt as part of its $12.7 billion
merger.  As reported by the Troubled Company Reporter yesterday,
the company has brought on board Kevin M. McShea of AlixPartners,
LLP as Chief Restructuring Officer of LyondellBasell and its
subsidiaries.  The company also has hired advisers,
including Evercore and New York law firm Cadwalader, Wickersham &
Taft LLP, to advise it on its restructuring efforts.

                    About LyondellBasell

LyondellBasell Industries -- http://www.lyondellbasell.com/-- is
a refiner of crude oil; a significant producer of gasoline
blending components; a global manufacturer of chemicals and
polymers, including polyolefins and advanced polyolefins; and the
leading developer and licensor of technologies for the production
of polymers.

Following the acquisition of Lyondell in 2007, LyondellBasell
became the world's largest independent producer of polypropylene
and advanced polyolefins products, a leading supplier of
polyethylene, and a global leader in the development and licensing
of polypropylene and polyethylene processes and related catalyst
sales.  The group is estimated to generate 2007 revenues of US$44
billion and EBITDA of US$4.1 billion reflecting strong performance
of Lyondell and Basell businesses at the top of the cycle.

As reported by the Troubled Company Reporter on Nov. 18, 2008,
Moody's Investors Service downgraded the Corporate Family Rating
of LyondellBasell Industries AF SCA to B3 from B1.  The ratings on
the first lien facilities have been downgraded to B1/ LGD 2(27)
and the ratings on the legacy notes of Basell and Lyondell have
been downgraded to Caa2, with various LGD rates.  LBI has
rearranged its USD 8 billion second lien facility into
US$5.5 billion second lien facilities and USD 2.5 billion third
lien facility.  The new facilities have been rated Caa1/ LGD 5
(73) and Caa2/ LGD 5 (86) respectively.  The outlook on the
ratings remains negative.

As reported by the TCR Europe on Nov. 26, 2008, Fitch Ratings
downgraded Netherlands-based petrochemicals company Lyondell
Basell Industries AF SCA's Long-term Issuer Default rating to 'B-
'(B minus) from 'B+' while maintaining a Negative Outlook.  At the
same time, Fitch affirmed LBI's Short-term IDR at 'B'.

Lyondell disclosed in its latest quarterly results that it has
$27.12 billion in assets and $228 million stockholders' deficit as
of Sept. 30, 2008.  It incurred a $232 million net loss in the
three months ended Sept. 30, 2008, compared to a $206 million net
profit during the same period in 2007.


LYONDELLBASELL: Moody's Junks Corporate Family Rating
-----------------------------------------------------
Moody's Investors Service has downgraded the corporate family
rating of LyondellBasell Industries AF SCA to Caa2 from B3 and
also downgraded ratings on the debt instruments raised by the
group.  The ratings were also placed under review for downgrade
following the announcement made by the company on 29 December that
it has entered in discussions with its senior secured lenders
relating to the extension of its payment dates and restructuring
of its debt obligations.

Moody's notes that challenging operating environment in the
current quarter and likely sustained weakness in demand at the
beginning of the year will likely further restrict the headroom
under some of the company's financial covenants, while current
sustained decline in oil prices will likely further reduce
availability under inventory-based facility, while LBI still
benefits from the full availability under its USD 750 million
Access Facility and its substantial cash balances, as reported at
the end of 3Q 2008.

As part of the review, Moody's will monitor the outcome of the
restructuring discussions with the senior lenders, and will also
cover (a) the development of the group's liquidity position
pending resolution of the restructuring discussions; (b) LBI's
ability to maintain compliance with financial covenants during the
downturn; as well as (c) the likely evolution of the credit
profile of the group following the resolution of the restructuring
discussions with the lenders.  The review will also examine the
availability of shareholders support and/or accessibility of
sufficient cure measures to support LBI's compliance with payments
and covenants through a downturn in the cycle.

These ratings are affected:

  - Caa2 Corporate family rating at LyondellBasell Industries AF
    SCA;

  - B3 / LGD 2 (27) rating on the Senior Secured 1st lien
    facilities;

  - Caa3 / LGD 5 (73) rating on Senior Secured 2d lien facility at
    Lyondell Basell Finance Company;

  - Caa3 / LGD 5 (86) rating on Senior Secured 3d lien facility at
    Lyondell Basell Finance Company;

  - Ca / LGD 6 (94) rating on 2015 8.375% notes at LyondellBasell
    Industries AF SCA;

  - Ca / LGD 6 (94) rating on 2027 8.1% notes at Basell Finance
    Company;

  - Caa3 / LGD 5 (86) rating on 2026 7.55% notes at Lyondell
    Chemical Company (Assumed by Equistar LP);

  - Ca / LGD 6 (94) rating on 2026 7.625% notes at Millennium
    America Inc.;

  - Caa3 / LGD 5 (86) rating on 2010 10.25% notes at Lyondell
    Chemical Worldwide, Inc.;

  - Caa3 / LGD 5 (86) rating on 2020 9.8% notes at Lyondell
    Chemical Worldwide, Inc.

Moody's last rating action on the company was 14 November 2008
when the rating agency downgraded the corporate family rating of
Lyondell Basell Industries AF SCA to B3 with negative outlook and
downgraded the ratings of various instruments raised by the
company's subsidiaries.

Following the acquisition of Lyondell in 2007, LyondellBasell
became the world's largest independent producer of polypropylene
and advanced polyolefins products, a leading supplier of
polyethylene, and a global leader in the development and licensing
of polypropylene and polyethylene processes and related catalyst
sales.  The group is estimated to generate 2007 Revenues of USD 44
billion and EBITDA of USD 4.1 billion reflecting strong
performance of Lyondell and Basell businesses at the top of the
cycle.


LYONDELLBASELL: Likely Chapter 11 Filing Cues Fitch's Junk Rating
-----------------------------------------------------------------
Fitch Ratings has downgraded Netherlands-based petrochemicals
company Lyondell Basell Industries AF SCA's Long-term Issuer
Default Rating to 'C' from 'B-' (B minus).  The agency has
simultaneously downgraded the Short-term IDR to 'C' from 'B'.  The
ratings have been placed on Rating Watch Negative.

The downgrades follow LBI's announcement on 29 December 2008 that
it is considering filing for bankruptcy protection under Chapter
11 of the US bankruptcy code, among various strategic options.
The company has also initiated discussions with lenders to extend
payment dates and restructure its debt obligations.  However, LBI
has stated that its request for a credit extension from A.I.
International S.a.r.l., an affiliate of its shareholder, Access
Industries, under the Revolving Credit Agreement originally dated
27 March 2008, has been denied.  Fee and interest payments of
USD281m that were due on 19 December, 29 December and 31 December
2008 under the Bridge Loan Agreement originally dated 20 December
2007, have been postponed to 4 January 2009.

The RWN on LBI's ratings reflects uncertainties related to the
outcome of the company's debt restructuring under presently tight
market conditions and Fitch's belief that LBI will continue to
face challenging market conditions in the near term with mounting
pressure on its operating performance and cash flow generation and
liquidity.

Fitch will continue to closely monitor developments and will
review its ratings and recovery assumptions when new developments
occur.

The rating actions applicable to LBI and its related entities are:

Lyondell Basell Industries AF SCA (formerly Basell AF SCA)

  -- Long-term IDR: downgraded to 'C' from 'B-'(B minus); placed
     on RWN

  -- Short-term IDR: downgraded to 'C' from 'B'; placed on RWN

  -- Senior notes: downgraded to 'C'/'RR6' from 'CCC'/'RR6';
     placed on RWN

Lyondell Chemicals Company

  -- Long-term IDR: downgraded to 'C' from 'B-'(B minus); placed
     on RWN

  -- Secured debentures: downgraded to 'B-'(B minus)/'RR1' from
     'BB-'(BB minus)/'RR1'; placed on RWN

Lyondell Basell Finance Co

  -- Fixed-rate second-lien loan downgraded to 'C'/'RR6' from
     'CCC'/'RR6'; placed on RWN

  -- Floating-rate second-lien loan: downgraded to 'C'/'RR6' from
     'CCC'/'RR6'; placed on RWN

  -- Floating-rate third-lien loan: downgraded to 'C'/'RR6' from
     'CCC'/'RR6'; placed on RWN

Equistar Chemicals L.P.

  -- Long-term IDR: downgraded to 'C' from 'B-'(B minus); placed
     on RWN

  -- Secured debentures: downgraded to 'B-'(B minus)/'RR1' from
     'BB-'(BB minus)/'RR1'; placed on RWN

Millennium America Inc.

  -- Long-term IDR: downgraded to 'C' from 'B-'(B minus); placed
     on RWN

  -- Senior debentures: downgraded to 'C'/'RR6' from 'CCC'/'RR6';
     placed on RWN


MAINSTREAM MEDIA: Files for Chapter 11 Protection
-------------------------------------------------
Michael Hinman at Atlanta Business Chronicle reports that
Mainstream Media International has filed for Chapter 11 bankruptcy
protection in the U.S. Bankruptcy Court for the Middle District of
Florida.

Mainstream Media listed assets of up to $500,000 and liabilities
of up to $10 million, Atlanta Business relates.

Atlanta Business states that Mainstream Media owed $1.49 million
to its 20 largest unsecured creditors.  Court documents say that
Florida Citrus Sports holds a $253,000 unsecured claim against
Mainstream Media.  According to Atlanta Business, Mainstream Media
owes:

     -- $150,000 to the Miami Dolphins,
     -- $119,000 to Chicago publisher R.R. Donnelley & Sons Co.,
     -- Sunshine Sports Marketing of Gainesville,
     -- Interpint in Clearwater,
     -- the Ladies Professional Golf Association
     -- $28,100 to Chick-fil-A Bowl, and
     -- $30,000 to Marlin Leasing Corp.

According to Atlantic Business, Mainstream Media reached a
licensing deal with NASCAR in June 2008, which allows the company
to publish "Chase for the Cup," a 160-page promotional magazine
that would feature photos, driver and crew interviews, track
profiles, and other race-related stories in time for the start of
the final 10 races of the NASCAR season in September.

A creditors' meeting is set for Jan. 30, 2009, at the Tampa
Courthouse, 501 East Polk Street, Atlantic Business says.

Mainstream Media International is a sports marketing company based
in Clearwater, Florida.  It has an office in Atlanta.


MAJESTIC PLAZA: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: Majestic Plaza, LLC
        9650 N. Augusta Dr., #9
        Carmel, IN 46032
        County: Hamilton

Bankruptcy Case No.: 08-15940

Chapter 11 Petition Date: December 29, 2008

Court: United States Bankruptcy Court
       Southern District of Indiana (Indianapolis)

Judge: Judge James K. Coachys

Debtor's Counsel: KC Cohen, Esq.
                  151 N. Delaware St. Ste. 1104
                  Indianapolis, IN 46204
                  Tel.: (317) 715-1845
                  Fax : (317) 916-0406
                  Email: kc@esoft-legal.com

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

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

A list of the Debtor's largest unsecured creditors is available
for free at:

        http://bankrupt.com/misc/insb08-15940.pdf

The petition was signed by Majid Rastegar, managing member of the
company.


MEDICOR LTD: Court Extends Plan Filing Period to Dec. 29, 2008
--------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware granted
MediCor Ltd., and its debtor-affiliates, on Jan. 5, 2009, a sixth
extension of their exclusive periods to:

  a) file a Chapter 11 plan from Dec. 5, 2008, to and including
     Dec. 29, 2008;

  b) solicit acceptances to said plan from Feb. 3, 2008, to and
     including Feb. 27, 2009.

                        About MediCor Ltd.

Headquartered in North Las Vegas, Nevada, MediCor Ltd. --
http://www.medicorltd.com/-- manufactures and markets products
primarily for aesthetic, plastic and reconstructive surgery and
dermatology markets.  The company and seven of its affiliates
filed for Chapter 11 protection on June 29, 2007 (Bankr. D. Del.
Lead Case No. 07-10877) to effectuate the orderly marketing and
sale of their business.  Dennis A. Meloro, Esq., and Victoria
Watson Counihan, Esq., at Greenberg Traurig, LLP, represent the
Debtors as Delaware counsel.  The Debtors engaged Alvarez & Marsal
North America, LLC as their restructuring advisor.  David W.
Carickhoff, Jr., Esq., at Blank Rome LLP represents the Official
Committee of Unsecured Creditors as counsel.  In its schedules of
assets and debts, MediCor Ltd. disclosed total assets of
$96,553,019, and total debts of $158,137,507.


MEDICOR LTD: Files Chapter 11 Plan and Disclosure Statement
-----------------------------------------------------------
MediCor Ltd., and its debtor-affiliates, delivered to the U.S.
Bankruptcy Court for the District of Delaware on Dec. 29, 2008, a
Chapter 11 Plan of Liquidation and an explanatory disclosure
statement.

The hearing to approve the adequacy of the Disclosure Statement is
set for Jan. 29, 2009, at 3:00 p.m.  Objections to the Disclosure
Statement are due by Jan. 23, 2009.

The Debtors believe that the Plan is substantially preferable to
any other plan, liquidation under Chapter 7 of the Bankruptcy Code
or a dismissal of these Chapter 11 cases.

               Debtors' Capital and Debt Structure

As of the Petition Date, the Debtors had outstanding aggregate
secured debt totaling approximately $61,800,000 (plus $11,982,760
of accrued interest and registration penalties) and outstanding
aggregate unsecured debt of approximately $80.9 million.

                       Overview of the Plan

The Plan provides for the wind up of affairs and the distribution
of the net proceeds realized from the prior sale of the Debtors'
assets to creditors in accordance with the priorities established
by the Bankruptcy Code and pursuant to the General Unsecured
Creditor Settlement.  The Plan establishes, among other things, a
liquidating trust that will, among others, prosecute certain
litigation, the provisions governing such distributions to Holders
of Allowed Claims and the process for resolving Disputed Claims
against the Debtors.

MediCor's prepetition Senior Lenders, in exchange for the release
of prepetition secured indebtedness in excess of $57 million owed
to them by the Debtors and their direct and indirect non-Debtor
subsidiaries, will receive the Distributable Cash under the Plan.
In addition, the Senior Lenders will receive, in exchange for the
release of prepetition deficiency claims, a pro rata share of
certain proceeds of litigation to be pursued by a liquidating
trustee appointed under the Plan.

Additionally, pursuant to the Plan and a settlement with the
Senior Lenders and Official Committee of Unsecured Creditors,
holders of Allowed General Unsecured Claims will receive, in
exchange for the discharge of prepetition unsecured indebtedness
owed to them by the Debtors, pro rata shares of (i) $700,000 cash,
and (ii) certain proceeds of litigation to be pursued by a
liquidating trustee appointed under the Plan.

Under the Plan, Priority Tax Claims are unclassified and, at the
election of the Debtors, are to be paid in full or in equal
quarterly installments, commencing on the first business day
following the Effective Date and ending on the fifth anniversary
of the Petition Date together with interest accrued thereon, or
upon such other terms as the Debtors and the affected creditor may
agree.  Administrative Claims are unclassified and are to be paid
in full.  Class 1 Priority Non-Tax Claims are left unimpaired, and
are to be paid in full.  Holders of Southwest Exchange Claims,
Interdebtor Claims, Non-Debtor Subsidiary Claims, Stock Claims and
Equity Interests in the Debtors will receive no distributions.

                           Plan Funding

The Plan will be funded from the Debtors' available Cash, the
Eurosilicone Escrow Funds and the Biosil Escrow Funds.  The
Debtors' available Cash, the Eurosilicone Escrow Funds and the
Biosil Escrow Funds are the cash collateral of the Senior Lenders,
and the Senior Lenders have agreed to carve out and forgo a
portion of their recovery on account of the Allowed Senior Lender
Secured Claims in order to transfer the General Unsecured Cash
Payment, the Litigation Fund Payment, and the Distribution of the
General Unsecured Creditors Litigation Proceeds and the proceeds
of the PIP PMA to the Liquidating Trust for the benefit of Holders
of Allowed General Unsecured Claims.

       Summary of Treatment of Claims and Equity Interests

Pursuant to the Plan, the various claims and equity interests are
segregated into 8 classes:

                       Estimated Total
Class                 Allowed Amounts    Treatment Under the
                                          Plan
-----                 ---------------    -----------------------
  1  Priority          $210,000           Unimpaired.  To be paid
     Non-Tax Claims                       in full.

  2  Southwest         $0.00              Unimpaired.  Will not
     Exchange Claims                      receive any
                                          distribution or
                                          payments of any kind.
                                          In accordance with the
                                          Bankruptcy Settlement
                                          Order, all Class 2
                                          Claims have been or
                                          Will be deemed
                                          withdrawn or expunged.

  3  Senior Lender     $57,071,384        Impaired.  Will receive
     Secured Claims                       Pro Rata share of the
                                          Distributable Cash.


  4  Senior Lender     $57,071,384        Impaired.  Will receive
     Deficiency        less amount of     Pro Rata share of the
     Claims            Distributable      Senior Lender
                                          Litigation
                       Cash               Proceeds and the
                                          proceeds of the PIP PMA
                                          payable to Holders of
                                          Senior Lender
                                          Deficiency Claims.

  5  General           $4,000,000 to      Impaired.  Will receive
     Unsecured         $45,000,000        Pro Rata share of the
     Claims                               General Unsecured Cash
                                          Payment and the General
                                          Unsecured Creditors
                                          Litigation Proceeds and
                                          the proceeds of the PIP
                                          PMA payable to Holders
                                          of Allowed General
                                          Unsecured Claims.

  6  Interdebtor       $0.00              Impaired.  Will not
     Claims                               receive any
                                          distribution or payment
                                          of any kind.

  7  Non-Debtor        $0.00              Impaired.  Will not
     Subsidiary                           receive any
     Claims                               distribution
                                          or payment of any kind.

  8  Equity            $0                 Impaired.  Will not
     Interests and                        receive any
     Stock Claims                         distribution
                                          or payment of any kind.
                                          On the Effective Date,
                                          all Equity Interests
                                          shall be deemed
                                          canceled and of no
                                          force or effect and the
                                          Holders of Stock Claims
                                          shall not be entitled
                                          to receive or retain
                                          any property on account
                                          of such Claims.

                           Who May Vote

Under the Plan, Class 3, Class 4, Class 5, Class 6, Class 7 and
Class 8 impaired.  Holders of Claims in Class 3, Class 4 and Class
5 are entitled to vote, spearately, to accept or reject the Plan.
Holders of Claims in Class 1 are deemed under Sec. 1126(f) of the
Bankruptcy Code to have accepted the Plan.  Holders of Claims in
Class 2 are or will be deemed under the Receiver Settlement
Agreement to have accepted the Plan.  Holders of Claims in Class 6
and Class 7 and Holders of Equity Interests and Claims in Class 8
receive no Distributions under the Plan and, therefore, are deemed
under Sec. 1126(g) of the Bankruptcy Code to have rejected the
Plan.

                             Cramdown

The Debtors intend to invoke the "cramdown" provisions of the
Bankruptcy Code should any voting Class fail to accept the Plan.
Pursuant to Sec. 1129(b) of the Bankruptcy Code, the Court may s
confirm the Plan, even though a class of Claims or Equity
Interests has not voted to accept the Plan, so long as one
Impaired class of Claims has accepted the Plan (excluding the
votes of Insiders) and the Plan is "fair and equitable" and "does
not discriminate unfairly" against the non-accepting classes.

A full-text copy of the Debtors' Disclosure Statement explaining
their Chapter 11 Plan of Liquidation, dated Dec. 29, 2008, is
available for free at:
   http://bankrupt.com/misc/MedicorLtd_DisclosureStatement.pdf

                        About MediCor Ltd.

Headquartered in North Las Vegas, Nevada, MediCor Ltd. --
http://www.medicorltd.com/-- manufactures and markets products
primarily for aesthetic, plastic and reconstructive surgery and
dermatology markets.  The company and seven of its affiliates
filed for Chapter 11 protection on June 29, 2007 (Bankr. D. Del.
Lead Case No. 07-10877) to effectuate the orderly marketing and
sale of their business.  Dennis A. Meloro, Esq., and Victoria
Watson Counihan, Esq., at Greenberg Traurig, LLP, represent the
Debtors' as Delaware counsel.  The Debtors engaged Alvarez &
Marsal North America, LLC as their restructuring advisor.  David
W. Carickhoff, Jr., Esq., at Blank Rome LLP represents the
Official Committee of Unsecured Creditors as counsel.  In its
schedules of assets and debts, MediCor Ltd. disclosed total assets
of $96,553,019, and total debts of $158,137,507.


MIGENIX INC: Oct. 31 Balance Sheet Upside Down by CC$5.2 Million
----------------------------------------------------------------
MIGENIX Inc. has incurred significant losses since inception and
as at October 31, 2008 had working capital of approximately
C$0.7 million and an accumulated deficit of approximately
C$143.4 million.

"The company's current financial resources are expected to be
sufficient for operations to February 2009. The company's ability
to realize the carrying value of its assets is dependent on
successfully advancing its technologies to market through the drug
development and approval processes and ultimately achieving future
profitable operations, the outcome of which cannot be predicted at
this time, or in the alternative being able to sell the assets for
proceeds for their carrying value or greater," President & CEO
James DeMesa disclosed in a regulatory filing with the U.S.
Securities and Exchange Commission.

As of October 31, 2008, the company's balance sheet showed total
assets of C$3,675,000 and total liabilities of C$8,930,000,
resulting in total shareholders' deficit of C$5,255,000.

For the three months ended October 31, 2008, MIGENIX incurred a
loss of C$3.3 million and for the six months ended October 31,
2008, the loss is C$6.0 million.

As of October 31, 2008, the company had cash, cash equivalents and
short-term investments of C$1.9 million and the company's
net working capital was C$0.7 million. The C$4.3 million decrease
in net working capital from April 30, 2008 is primarily
attributable to the C$4.3 million in expenses for the six months
ended October 31, 2008 that do not require the use of cash -- i.e.
non-cash expenses include: amortization, stock-based compensation,
deferred share unit compensation and the accretion of the
convertible royalty participation units.

MIGENIX believes that its funds on hand at October 31, 2008, and
C$0.3 million in funds received in December 2008 from the
October 31, 2008 amounts receivable, combined with ongoing cost
reduction measures, are sufficient to provide for operations to
approximately February 2009 before funds received, if any, from
existing or new license agreements, the exercise of warrants and
options, and a planned rights offering in the aggregate amount up
to C$2.5 million.

"The company has been able, thus far, to finance its cash
requirements primarily from equity financings and payments from
licensing agreements. On August 11, 2008 the company announced
that it had reached an agreement with DJohnson Holdings Inc., a
significant shareholder of the company, to avoid a proxy contest
at the company's annual meeting of shareholders held on
October 31, 2008. As part of the agreement, the company
restructured its board of directors and appointed a new President
and CEO. Additionally under the agreement, DJohnson agreed to
provide a standby commitment to take up shares in an aggregate
amount equal to a minimum of C$1.25 million in a proposed rights
offering.

"The new board and management are concentrating their efforts on:
(i) reducing expenses; (ii) licensing arrangements; and (iii)
raising additional capital. Management and the board are planning
to obtain additional funds through a rights offering, new
licensing arrangements and milestones from existing license
agreements, however, the outcome of these matters cannot be
predicted at this time. In the first quarter of calendar 2009, the
company is expecting Phase III clinical trial results from
OmigardTM -- these Phase III results will be a pivotal event in
the future of the company as the results will affect future
financing, licensing and milestone opportunities. These conditions
raise substantial doubt about the company's ability to continue as
a going concern," Mr. DeMesa said.

A full-text copy of the company's quarterly financials is
available for free at: http://researcharchives.com/t/s?3750 A
full-text copy of management's discussion and analysis is
available for free at: http://researcharchives.com/t/s?3751

                          About MIGENIX

Headquartered in Vancouver, British Columbia, Canada, MIGENIX Inc.
-- http://www.migenix.com/-- is a biopharmaceutical company
engaged in the research, development and commercialization of
drugs for the treatment of infectious diseases to advance therapy,
improve health and enrich lives.


NAVISTAR INTL: Projects Up to $410 Million in 2009 Net Income
-------------------------------------------------------------
Navistar International Corporation bared fiscal 2009 net income
guidance prior to its fourth quarter and fiscal 2008 analyst
presentation. The company said that based on current market
conditions, net income for its fiscal year ending October 31,
2009, should be in the range of $370 million or $5.10 per diluted
share to $410 million or $5.60 per diluted share.

"Our ability to continue to execute our business strategy built
around customers, products and growth is reflected in our high
level of confidence in the earnings guidance announced today,"
said Dan Ustian, Navistar chairman, president and chief executive
officer. "Our growth in the commercial truck market outside the
U.S. and Canada is due in part to our growing military business
and expansion into new business opportunities and will factor into
our ability to deliver profitability in 2009 despite a weak North
American business climate."

In addition to its earnings guidance for fiscal 2009, the company
also gave an estimate of the industry forecast for North America.
The company believes the industry forecast for the United States
and Canadian retail sales volume for Class 6-8 trucks and school
buses for the fiscal year ending October 31, 2009, should total
between 244,000 to 256,000 units. Industry volumes totaled 244,100
units in fiscal 2008; volume was among the lowest in more than 30
years.

"Our profitability in 2008 in turbulent economic conditions
demonstrates our ability to grow outside our core North American
business by growing beyond the cyclicality of our traditional
markets into other profitable businesses," Mr. Ustian said.

                          GREAT PRODUCTS

     -- Continued growth in Class 8 market share -- Navistar
improved its share in the Class 8 market with International(R)
ProStar(R), the most aerodynamic big-rig in the industry. And the
company is positioned for 2009 and beyond with LoneStar(R), the
fuel-efficiency leader among premium Class 8 trucks, and
MaxxForce(TM) big bore engines, which started delivery in the
third quarter of fiscal 2008. The company began delivering the
LoneStar to customers in November 2008.

     -- EGR versus SCR strategy -- In order to meet the U.S.
Environmental Protection Agency's 2010 emissions standards,
Navistar is driving ahead with advancements to its simple,
customer-friendly Exhaust Gas Recirculation (EGR) technology,
which will be introduced into every MaxxForce(TM) engine. Navistar
is fully prepared to meet 2010 with its EGR technology, but the
company recognizes the need to advocate for its customers in these
catastrophic economic times. As the truck industry is impacted by
high diesel fuel prices, bankruptcy and price increases, Navistar
has led the charge in Washington to advocate engine choice for
customers by allowing the purchase of 2007 as well as 2010-
compliant technology.

                    COMPETITIVE COST STRUCTURE

     -- Truck operations realignment is expected to position
company for 2009 and beyond -- At the end of 2008, the company
restructured its truck operations to maximize efficiencies and
improve the cost structure of truck operations in order to
capitalize on the momentum and opportunities ahead for Navistar in
the company's core markets and around the world. By integrating
and aligning its operations for maximum impact in the marketplace,
the company expects to enhance its competitiveness around the
world and strengthen its core business in North America.

                        PROFITABLE GROWTH

     -- Building a sustainable military business -- Navistar
Defense, LLC, a part of its Truck segment, continues to develop
new offerings that are expected to provide military revenue of
approximately $2 billion. The company's current success and
reputation for quality positions it well for the future as the
company continues to pursue contracts with the U.S. and allied
governments.

     -- Growth of Parts business -- The company's focus on
responsive customer service and timely parts delivery is reflected
in the solid growth of its parts business. This month, Navistar
Parts will launch PartSmart(TM), a new value line of parts
expected to provide the company additional growth opportunities
despite the downturn in its traditional core markets.

     -- Growing the company's share of the commercial bus market -
- Navistar is partnering with other leading manufacturers to
develop new vehicles specifically designed for high-growth
markets, including a memorandum of understanding with Brazilian
bus body maker San Marino Onibus e Implementos LTDA for an
integrated commercial bus joint venture. In addition, IC Bus plans
to launch a motorcoach that leverages Navistar's expertise in
designing the most fuel-efficient trucks on the road and the
performance of the MaxxForce(TM) 13-liter engine.

     -- Expansion of global product lineup and dealer network --
Navistar continues to expand its global business. Currently,
Navistar is represented by 15 full-service dealerships in 33
locations in the Middle East, including Saudi Arabia and the
United Arab Emirates. The company is on track to achieve its long-
term goal of deriving 50% of the company's truck revenues from
outside the U.S. and Canada. And the company is also well on the
way to its goal of diversifying engine volumes to roughly one-
third in North America, one-third in South America and one-third
in the rest of the world.

These and other steps to be taken by the company in 2009 are
expected to help the company overcome the challenges due to the
severe downtown in the North American truck and diesel engine
markets and the continued deterioration of the global economic
environment.

The Troubled Company Reporter said December 26, 2008, that
Navistar will restate its financial results for the nine months
ended July 31, 2008.  As a result, the company expects to increase
reported net income by $50 million to $70 million ($0.68 to $0.95
per diluted share) for the nine months ended July 31, 2008.

On December 23, 2008, the management of the company, with the
concurrence of the company's Audit Committee, concluded that the
company's previously issued unaudited financial statements for the
three and nine months ended July 31, 2008, should no longer be
relied upon because of errors that when restated will modestly
increase the company's net income for the three and nine months
ended July 31, 2008.

           About Navistar International Corporation

Based in Warrenville, Illinois, Navistar International Corporation
(NYSE: NAV) produces International(R) brand commercial and
military vehicles, MaxxForce(TM) brand diesel engines, IC brand
school and commercial buses, and Workhorse(R) brand chassis for
motor homes and step vans, and is a private label designer and
manufacturer of diesel engines for the pickup truck, van and SUV
markets.  Navistar is also a provider of truck and diesel engine
parts.  Another affiliate offers financing services.

As of July 31, 2008, Navistar $11.5 billion in total assets, $11.7
billion in total liabilities and $228 million in shareholders'
deficit.  Navistar reported $272 million net income for the three
months ended July 31, 2008, on sales and revenues of $3.8 billion.


NEBRASKA BOOK: S&P Puts 'B-' Corporate Rating on Negative Watch
---------------------------------------------------------------
Standard & Poor's Ratings Services said it placed its ratings,
including the 'B-' corporate credit rating, on Lincoln, Nebraska-
based Nebraska Book Co. Inc. and parent NBC Acquisition Corp. on
CreditWatch with negative implications.  This action reflects the
upcoming expiration of the company's $85 million revolving credit
facility on March 4, 2009.

Although there were no amounts outstanding and $75.8 million
available as of Sept. 30, 2008, the company does use the facility
periodically for seasonal working capital purposes as well as
acquisitions.  "We believe that Nebraska Book's liquidity position
could become impaired if another revolving credit line is not in
place by the time the current facility expires," said Standard &
Poor's credit analyst David Kuntz, "which could inhibit the
company's growth strategy as well as limit its ability to purchase
inventory for working capital needs."


NORTHSTAR NEUROSCIENCE: Board Approves Plan to Dissolve Business
----------------------------------------------------------------
The Board of Directors of Northstar Neuroscience, Inc., has
determined, in its best business judgment after consideration of
potential strategic alternatives, that it is in the best interests
of the Company and its shareholders to liquidate the Company's
assets and to dissolve the Company.  The Company's Board of
Directors has approved a Plan of Complete Liquidation and
Dissolution of the Company, subject to shareholder approval.  The
Company intends to hold a special meeting of shareholders to seek
approval of the Plan and will file related proxy materials with
the Securities and Exchange Commission in the near future. Prior
to the special meeting the Company will reduce its headcount to a
limited number of employees who will assist in the termination of
operations.

The Plan contemplates an orderly wind down of the Company's
business and operations.  If the Company's shareholders approve
the Plan, the Company intends to file articles of dissolution,
satisfy or resolve its remaining liabilities and obligations,
including but not limited to contingent liabilities and claims,
ongoing clinical trial obligations, lease obligations, severance
for terminated employees, and costs associated with the
liquidation and dissolution, and make distributions to its
shareholders of cash available for distribution, subject to
applicable legal requirements.  Following shareholder approval of
the Plan and the filing of articles of dissolution, the Company
would delist its common stock from NASDAQ.

As reported by the Troubled Company Reporter on July 14, 2008, RA
Capital Advisors wanted Northstar Neuroscience to liquidate or
sell itself after Northstar's stock value slid down due to a
failed research venture.  According to a Seattle Times report, RA
sent a letter to Northstar's board of directors to press the
company to lay-off a sizeable part of its workforce and halt all
operations, while it tries to find a buyer for the company.  In
the alternative, the company might have to liquidate and split its
cash-on-hand -- which is worth $73 million as of March 31 -- to
its shareholders.  RA Capital is the company's largest
shareholder, the Times noted.

In its quarterly report for the period ended September 30, 2008,
the company had $72.2 million in total assets -- $69.2 million in
total current assets, including $7.6 million in cash and cash
equivalents -- and $3.5 million in total current liabilities, and
$365,000 in other long term liabilities.

Based in Seattle, Washington, Northstar Neuroscience --
http://www.northstarneuro.com/-- is pioneering the development of
cortical stimulation therapies.  The company is working with
healthcare partners to develop clinical applications from the
science of neurostimulation.  Its solutions are tuned to the
individual needs of patients -- offering greater hope for the
renewal and recovery from neurological injury, disorder or disease
-- enabling them to regain their quality of life.  Northstar's
Renova(TM) Cortical Stimulation System is an investigational
device that is in clinical trials for several indications,
including major depressive disorder, stroke motor recovery and
tinnitus.


PENN TREATY: Review of Events Cues Delay in Form 10-Q Filing
------------------------------------------------------------
Penn Treaty American Corporation disclosed in a FORM 12b-25 filing
with the Securities and Exchange Commission that it was unable to
file financial results for period ended Sept. 30, 2008, because it
has not yet determined its results due to these factors:

   -- On Aug. 21, 2008, the company's subsidiaries Penn Treaty
      Network America Insurance Company and American Network
      Insurance Company had provided notification of breach to
      their reinsurer, Imagine International Reinsurance Limited,
      for Imagine's failure to provide the requisite level of
      collateral in the form of letters of credit pursuant to
      Imagine's obligations under its reinsurance agreements.

   -- Subsequently, on Oct. 3, 2008 the company adopted an
      economic restructuring plan.  The components of the Plan
      are:

      1. The company's subsidiaries have notified their reinsurer
         of their intent to recapture all reinsured policies
         under several agreements on Jan. 1, 2009;

      2. The company is continuing the review of strategic
         alternatives through Dec. 31, 2008;

      3. The company voluntarily agreed that PTNA and ANIC would
         enter a rehabilitation plan with the Pennsylvania
         Insurance Department on Jan. 1, 2009; and,

      4. The company suspended new policy issuance effective
         Oct. 3, 2008, pending the outcome of the Plan.

   -- On Nov. 10, 2008, the company agreed upon binding terms for
      a final settlement with Imagine regarding the dispute.
      Under the terms of the agreement, the company will not pay
      expense and risk charges to Imagine beyond the first
      quarter of 2008 for its reinsurance treaty or beyond the
      second quarter of 2008 for its secondary treaty.  The
      company believes that it would have otherwise been
      obligated to pay expense and risk charges through the end
      of 2008 on the treaty and potentially through the third
      quarter of 2010 on the secondary treaty.  The company
      estimated the value of these fees to be approximately
      $14.5 million.  In exchange, the company has withdrawn its
      notice of intention to arbitrate and will release
      approximately $112 million in supporting letters of credit
      on Dec. 1, 2008, which would have otherwise been released
      on Jan. 1, 2009.  The company will not draw upon any of the
      letters of credit.  The company will recapture policies
      reinsured under both treaties on or before Jan. 1, 2009.
      Both parties also agreed to waive any future contractual or
      noncontractual claims relating to the treaties other than
      those relating to the settlement agreement itself.

The company anticipated that a final settlement agreement will be
executed by Nov. 14, 2008, which will be subject to the approval
of the Pennsylvania Insurance Department.  To date, the company
provided no update on this matter.

The company has been reviewing and researching the effect of these
actions on its financial statements for the current and prior
periods, both on the Statutory and GAAP bases of accounting.
These has delayed the filing of the Quarterly Report on Form 10-Q
for the period ended Sept. 30, 2008.

The company has not filed Quarterly Reports on Form 10-Q for the
quarters ended March 31, 2006, June 30, 2006, Sept. 30, 2006,
March 31, 2007, June 30, 2007, Sept. 30, 2007, March 31, 2008,
June 30, 2008 or an Annual Report on Form 10-K for the year ended
Dec. 31, 2007.

              About Penn Treaty American Corporation

Penn Treaty American Corporation -- https://www.penntreaty.com/ --
through its wholly owned direct and indirect subsidiaries, Penn
Treaty Network America Insurance Company, American Network
Insurance Company, American Independent Network Insurance Company
of New York, Network Insurance Senior Health Division and Senior
Financial Consultants Company, is engaged in the underwriting,
marketing and sale of individual and group accident and health
insurance products, principally covering long term nursing home
and home health care.

                           *     *     *

As reported in the Troubled Company Reporter on Oct. 8, 2008,
A.M. Best Co. has downgraded the financial strength rating to
D(Poor) from B-(Fair) and issuer credit ratings to "c" from "bb-"
of Penn Treaty American Corporation's (Allentown, PA) insurance
subsidiaries.  Penn Treaty's insurance subsidiaries include Penn
Treaty Network America Insurance Company, American Network
Insurance Company (both of Allentown, PA) and American Independent
Network Insurance Company of New York (New York).  Concurrently,
A.M. Best has downgraded the ICR to "c" from "ccc" of Penn Treaty.
The outlook for all ratings is negative.


PENN TREATY: Restructuring Plan Cues NYSE to Remove Common Stock
----------------------------------------------------------------
New York Stock Exchange LLC has notified the Securities and
Exchange Commission that it has removed the common stock of Penn
Treaty American Corporation from listing and registration on the
Exchange on Nov. 17, 2008, pursuant to the provisions of Rule
12d2-2(b), because, in the opinion of the Exchange, the stock is
no longer suitable for continued listing and trading on the
Exchange.

The Exchange's action was taken in light of the company's news
statements on Oct. 3, 2008, regarding a proposed economic
restructuring plan and the overall uncertainty as to the timing,
outcome, and ultimate effect on the company's shareholders.  The
company noted that, absent a binding letter of intent in
connection with its disclosed strategic alternatives review
process by Jan. 1, 2009, it has requested that the Pennsylvania
Insurance Department place its insurance subsidiaries under
voluntary rehabilitation effective Jan. 2, 2009, as its primary
insurance subsidiary would be considered insolvent under
Pennsylvania statute.

In connection with the plan, the company noted that the company
has also voluntarily ceased the issuance of new policies
nationwide effective immediately.  In addition, NYSE Regulation
noted the fact that the company was delayed in filing its
Dec. 31, 2007, Form 10-K and other quarterly reports with the SEC
and was operating under a late filer trading extension period that
would have extended through Oct. 31, 2008.

However, in light of these developments, NYSE Regulation decided
to take action to remove the company.

   1. The Exchange's Listed company Manual, Section 802.01D,
      states in part that 'the Exchange is not limited by the
      criteria set forth in this section.  Rather, it may make an
      appraisal of, and determine on an individual basis, the
      suitability for continued listing of an issue in the light
      of all pertinent facts whenever it deems the action
      appropriate, even though a security meets or fails to meet
      any enumerated criteria.'  Other factors which may lead to
      a company's delisting include: Reduction in Operating
      Assets and Scope of Operations

   2. The Exchange, on Oct. 3, 2008, determined that the Common
      Stock of the company must be suspended immediately, and
      directed the preparation and filing with the Commission of
      this application for the removal of the Common Stock from
      listing and registration on the Exchange.  The company was
      notified by letter on Oct. 3, 2008.

   3. Pursuant to the above authorization, a press release was
      immediately issued and an statement was made on the
      'ticker' of the Exchange immediately and at the close on
      Oct. 3, 2008, of the suspension of trading in the Common
      Stock.  Similar information was included on the Exchange's
      Web site.

   4. The company had a right to appeal to the Committee for
      Review of the board of directors of NYSE Regulation the
      determination to delist its Common Stock, provided that it
      filed a written request for such a review with the
      Secretary of the Exchange within ten business days of
      receiving notice of delisting determination.  The company
      did not file such request within the specified time period.

              About Penn Treaty American Corporation

Penn Treaty American Corporation -- https://www.penntreaty.com/ --
operates long-term care insurance.  The company introduced its
first nursing home policy in 1972 and have provided valuable
coverage to thousands of people.  Penn Treaty has three insurance
company subsidiaries: Penn Treaty Network America Insurance
Company (Penn Treaty Network America Life Insurance Company in
California), American Network Insurance Company and American
Independent Network Insurance Company of New York.

                           *     *     *

As reported in the Troubled Company Reporter on Oct. 8, 2008,
A.M. Best Co. has downgraded the financial strength rating to
D(Poor) from B-(Fair) and issuer credit ratings to "c" from "bb-"
of Penn Treaty American Corporation's (Allentown, PA) insurance
subsidiaries.  Penn Treaty's insurance subsidiaries include Penn
Treaty Network America Insurance Company, American Network
Insurance Company (both of Allentown, PA) and American Independent
Network Insurance Company of New York (New York).  Concurrently,
A.M. Best has downgraded the ICR to "c" from "ccc" of Penn Treaty.
The outlook for all ratings is negative.


PENN TREATY: Sells UIG Subsidiary to LTC for $14.2 Million
----------------------------------------------------------
Penn Treaty American Corporation sold 100% of the common stock
ownership in its subsidiary, United Insurance Group Agency, Inc.,
of Milford, Michigan to LTC Global, Inc.

The net purchase price of $14.25 million is comprised of:

   1) $1 million in cash;

   2) $10.25 million as a promissory note, payable upon the
      earlier of (i) 120 days from Nov. 5, 2008, or (ii) the
      completion of executed commission assignments, which Penn
      Treaty believes the majority of which will be completed
      within 60 to 90 days; and

   3) $3 million to be paid in installments as future commissions
      are paid to UIG by Penn Treaty's subsidiary insurers, which
      Penn Treaty anticipates will be repaid within approximately
      two to three years.  In addition to the net purchase price,
      Penn Treaty will retain approximately $3 million in cash
      and cash equivalents held by UIG at Sept. 30, 2008.  Penn
      Treaty has also received approximately $4.5 million in
      dividends and tax provisions from UIG in 2008.

At Sept. 30, 2008, UIG had a book value of approximately
$5.5 million, which excludes the cash and cash equivalents being
retained by Penn Treaty.  Penn Treaty recorded a gain, net of
taxes, of approximately $8.5 million on the transaction.  The
proceeds of the sale will be retained by Penn Treaty for parent
company operations and for surplus infusion to its subsidiary
insurers as necessary.

                      About LTC Global, Inc.

LTC Global Inc. -- http://www.ltcglobal.com/--provides capital,
sales and marketing solutions to the LTCi industry.  LTC Global
maintains a North American presence in the marketing and
distribution of LTCi and other insurance-related products through
its subsidiaries ACSIA Long Term Care, Inc., Gelbwaks Insurance
Services, Inc. and Senior WealthCare Insurance Services.

              About Penn Treaty American Corporation

Penn Treaty American Corporation -- https://www.penntreaty.com/ --
through its wholly owned direct and indirect subsidiaries, Penn
Treaty Network America Insurance Company, American Network
Insurance Company, American Independent Network Insurance Company
of New York, Network Insurance Senior Health Division and Senior
Financial Consultants Company, is engaged in the underwriting,
marketing and sale of individual and group accident and health
insurance products, principally covering long term nursing home
and home health care.

                           *     *     *

As reported in the Troubled Company Reporter on Oct. 8, 2008,
A.M. Best Co. has downgraded the financial strength rating to
D(Poor) from B-(Fair) and issuer credit ratings to "c" from "bb-"
of Penn Treaty American Corporation's (Allentown, PA) insurance
subsidiaries.  Penn Treaty's insurance subsidiaries include Penn
Treaty Network America Insurance Company, American Network
Insurance Company (both of Allentown, PA) and American Independent
Network Insurance Company of New York (New York).  Concurrently,
A.M. Best has downgraded the ICR to "c" from "ccc" of Penn Treaty.
The outlook for all ratings is negative.


PENN TREATY: To Sell American Network Insurance
-----------------------------------------------
Penn Treaty American Corporation entered into a non-binding letter
of intent to sell a majority interest in an insurance subsidiary
and its business operations.

The terms of the anticipated transaction included these:

   1.  The sale of the majority of the equity interests in one of
       the company's insurance subsidiaries, American Network
       Insurance Company, including substantially all of the
       company's long-term care insurance policies issued after
       Dec. 31, 2001.

       In connection with the anticipated transaction, new long-
       term care insurance policies are expected to be issued by
       ANIC soon as practical after the closing of the sale;

   2.  The company will retain ownership of all long-term care
       insurance policies issued prior to 2002; and,

   3.  The company will transfer substantially all long-term care
       insurance operations to the purchaser.

The company will disclose the remaining terms of the offer upon
completion of due diligence and definitive documentation, which is
expected on or before Feb. 13, 2009.  Approval of the Pennsylvania
Insurance Department will be required in connection with this
transaction.

The company anticipates that its insurance subsidiary, Penn Treaty
Network America Insurance Company will enter rehabilitation by its
domiciliary state of Pennsylvania on Jan. 2, 2009.  The completion
of the transaction contemplated by the non-binding letter of
intent is not expected to prevent PTNA from entering
rehabilitation.

              About Penn Treaty American Corporation

Penn Treaty American Corporation -- https://www.penntreaty.com/ --
through its wholly owned direct and indirect subsidiaries, Penn
Treaty Network America Insurance Company, American Network
Insurance Company, American Independent Network Insurance Company
of New York, Network Insurance Senior Health Division and Senior
Financial Consultants Company, is engaged in the underwriting,
marketing and sale of individual and group accident and health
insurance products, principally covering long term nursing home
and home health care.

                           *     *     *

As reported in the Troubled Company Reporter on Oct. 8, 2008,
A.M. Best Co. has downgraded the financial strength rating to
D(Poor) from B-(Fair) and issuer credit ratings to "c" from "bb-"
of Penn Treaty American Corporation's (Allentown, PA) insurance
subsidiaries.  Penn Treaty's insurance subsidiaries include Penn
Treaty Network America Insurance Company, American Network
Insurance Company (both of Allentown, PA) and American Independent
Network Insurance Company of New York (New York).  Concurrently,
A.M. Best has downgraded the ICR to "c" from "ccc" of Penn Treaty.
The outlook for all ratings is negative.


PULMONARY & INTERNAL: Case Summary & 20 Largest Unsec. Creditors
----------------------------------------------------------------
Debtor: Pulmonary & Internal Medicine Specialists, P.C.
        26699 West 12 Mile Road, Suite 201
        Southfield, MI 48034

Bankruptcy Case No.: 08-71572

Chapter 11 Petition Date: December 29, 2008

Court: United States Bankruptcy Court
       Eastern District of Michigan (Detroit)

Judge: Judge Steven W. Rhodes

Debtor's Counsel: Meredith McKinzie, Esq.
                  Strobl & Sharp, P.C.
                  300 East Long Lake Road, Suite 200
                  Bloomfield Hills, MI 48304
                  Tel.: (248) 540-2300
                  Email: mmckinzie@stroblpc.com

Estimated Assets: $100,001 to $500,000

Estimated Debts: $1,000,001 to S10,000,000

A list of the Debtor's largest unsecured creditors is available
for free at:

        http://bankrupt.com/misc/mieb08-71572.pdf

The petition was signed by Virender Mendiratta, President of the
company.


QUAIL VALLEY: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Quail Valley Farms, Inc.
        7509 Cantrell Road, Suite 103 F.
        Little Rock, AR 72207

Bankruptcy Case No.: 08-18092

Type of Business: The Floriculture Production

Chapter 11 Petition Date: December 23, 2008

Court: United States Bankruptcy Court
       Eastern District of Arkansas (Little Rock)

Judge: Judge Audrey R. Evans

Debtor's Counsel: Scott T. Vaughn, Esq.
                  Hilburn Law Firm
                  P.O. Box 5551
                  North Little Rock, AR 72119
                  Tel.: (501) 372-0110
                  Fax : (501) 372-2028
                  Email: stinnon@hilburnlawfirm.com

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

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

A full-text copy of the Debtor's petition and a list of the
Debtor's largest unsecured creditors are available for free at:

        http://bankrupt.com/misc/areb08-18092.pdf

The petition was signed by Roger C. Gravis, President of the
company.


QUEBECOR WORLD: May Ink Pacts With Tennessee Development Boards
---------------------------------------------------------------
Quebecor World (USA) Inc., and its U.S. affiliates obtained
approval from the U.S. Bankruptcy Court for the Southern District
of New York to enter into certain lease amendments, notes,
security agreements and related documentation in connection with
the Debtors' ongoing relationships with certain Industrial
Development Boards located in Dyer County, the Town of Covington,
and Clarksville, in Tennessee.

The IDBs are public, not-for-profit corporations organized and
existing under the laws of the State of Tennessee.  Debtor QW
Memphis Corp. is the largest employer in Dyer County and one of
the largest employers in Covington, Michael J. Canning, Esq., at
Arnold & Porter LLP, in New York, said.  The Debtors, he added,
have substantial facilities and operations in each of the
jurisdictions associated with the IDBs, and in some cases have
longstanding relationships with each of the IDBs.

The Debtors, Mr. Canning has told the Court, are in negotiations
with Clarksville with respect to potentially entering into an IDB
Agreement.  If the Debtors reach agreement with Clarksville, they
would need to enter into IDB Agreements with Clarksville, as well
as with Dyer County and Covington, prior to December 31, 2008, to
realize the tax savings created by the IDB Agreements for 2009.

Industrial development boards are entities established by cities,
municipalities and counties pursuant to authority granted to them
by state law, with the purpose of permitting those cities,
municipalities and counties to offer tax incentives to encourage
businesses to locate facilities and assets in their
jurisdictions, with resulting economic benefits to those
jurisdictions.

The tax savings for businesses participating in these programs
consist of the elimination of ad valorem property tax obligations
that would otherwise be due under applicable state law.  The
elimination of the tax liability is accomplished through a
transfer of property by a business entity to an applicable
industrial development board, which, as a sovereign governmental
entity, is not liable to pay state property taxes.  The property
is then leased back to the business entity by the applicable
industrial development board.  As ad valorem property taxes are
assessed on property in the state as of January 1 under
applicable Tennessee law, thus the Debtors must enter into the
IDB Agreements by December 31, 2008, to realize the tax savings
created by the IDB Agreements for 2009.

The IDB Agreements will consist of a series of transactions with
the each of the IDBs that will facilitate the Debtors' commitment
of additional equipment to the facilities located in the
jurisdictions associated with the IDBs, as applicable, while at
the same time allowing the Debtors to realize substantial tax
savings.  Pursuant to the IDB Agreements, the Debtors will
transfer to the relevant IDB certain equipment or other property
pursuant to a Bill of Sale for personal property or a Deed for
real property, with legal title to the Transferred Property
thereafter being held by the applicable IDB.

In consideration of the transfer of the property to the
applicable IDB, the IDB will issue the Debtors a Note evidencing
that IDB's indebtedness to the Debtors on account of the
Transferred Property, and a Security Agreement granting the
Debtors a continuing security interest in the Transferred
Property.  In addition, the Debtors and the applicable IDB will
enter into a Lease Agreement for the Transferred Property
pursuant to which the Debtors will lease the Transferred Property
from the IDB for rental payments equal in amount to payments due
under the Note issued to the Debtors by the IDB.

Moreover, the IDB Agreements will result in substantial tax
savings for the Debtors.  Instead of paying ad valorem property
tax on equipment and real property located in the jurisdictions
in Tennessee, the Debtors need only make certain payments in lieu
of tax to the IDBs in consideration of the IDB Agreements.  Those
PILOT payments are typically a fraction of the ad valorem
property taxes that would otherwise be due absent the IDB
Agreements, and in some cases the IDB Agreements may provide
complete tax abatements for significant periods of time.  As a
result of the IDB Agreements, the Debtors are able to introduce
new equipment and expand their operations at certain facilities
while minimizing the tax consequences that would otherwise result
from installing new equipment at the Debtors' facilities in these
jurisdictions.

The IDBs, according to Mr. Canning, have notified the Debtors
that, in light of the Debtors' current status as debtors-in-
possession, the IDBs will not approve additional IDB Agreements
absent authorization from the Court for the Debtors to enter into
the IDB transactions.  The Debtors have substantial experience
with Industrial Development Boards and with transactions similar
to the IDB Agreements, and commonly engage in the transactions in
the ordinary course of their businesses to effectuate tax
savings.

                     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.

Ernst & Young, Inc., the monitor of Quebecor World Inc., and its
affiliates' reorganization proceedings under the Canadian
Companies' Creditors Arrangement Act, filed a petition under
Chapter 15 of the Bankruptcy Code before the U.S. Bankruptcy Court
for the Southern District of New York on September 30, 2008, on
behalf of QWI (Bankr. S.D.N.Y. Case No. 08-13814).  The chapter 15
case is before Judge James M. Peck.  Kenneth P. Coleman, Esq., at
Allen & Overy LLP, in New York, serves as counsel to the chapter
15 petitioner.

QWI and certain of its subsidiaries commenced the CCAA proceedings
before the Quebec Superior Court (Commercial Division) on
January 20, 2008.  The following day, 53 of QWI's U.S.
subsidiaries, including Quebecor World (USA), Inc., filed
petitions under Chapter 11 of the U.S. Bankruptcy Code.

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.

Quebecor World (USA) Inc., its U.S. subsidiary, along with other
U.S. affiliates, filed for chapter 11 bankruptcy before the U.S.
Bankruptcy Court for the Southern District of New York (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.

QWI is the only entity involved in the CCAA proceedings that is
not a Debtor in the Chapter 11 Cases.

As of June 30, 2008, Quebecor World's unaudited consolidated
balance sheet showed total assets of US$3,412,100,000 total
liabilities of US$4,326,500,000 preferred shares of US$62,000,000
and total shareholders' deficit of US$976,400,000.

The Hon. Robert Mongeon of the Quebec Superior Court has extended
until Dec. 14, 2008, the stay under the Canadian Companies'
Creditors Arrangement Act.


QUEBECOR WORLD: Receives Notices on 256,364 of Series 5 Shares
--------------------------------------------------------------
Quebecor World Inc. announced that, on or prior to December 29,
2008, it received notices in respect of 256,364 of its remaining
1,696,428 issued and outstanding Series 5 Cumulative Redeemable
First Preferred Shares (TSX: IQW.PR.C) requesting conversion into
the Company's Subordinate Voting Shares (TSX: IQW).

In accordance with the provisions governing the Series 5
Preferred Shares, registered holders of such shares are entitled
to convert all or any number of their Series 5 Preferred Shares
into a number of Subordinate Voting Shares effective as of
March 2, 2009, provided such holders gave notice of their
intention to convert at least 65 days prior to the Conversion
Date.  The Series 5 Preferred Shares are convertible into that
number of the Company's Subordinate Voting Shares determined by
dividing C$25.00 together with all accrued and unpaid dividends
on such shares up to February 28, 2009, by the greater of (i)
C$2.00 and (ii) 95% of the weighted average trading price of the
Series 5 Preferred Shares on the Toronto Stock Exchange during
the period of twenty trading days ending on February 26, 2009.

The next conversion date on which registered holders of the
Series 5 Preferred Shares will be entitled to convert all or any
number of such shares into Subordinate Voting Shares is June 1,
2009, and notices of conversion in respect thereof must be
deposited with the Company's transfer agent, Computershare
Investor Services Inc., on or before March 27, 2009.

                     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.

Ernst & Young, Inc., the monitor of Quebecor World Inc., and its
affiliates' reorganization proceedings under the Canadian
Companies' Creditors Arrangement Act, filed a petition under
Chapter 15 of the Bankruptcy Code before the U.S. Bankruptcy Court
for the Southern District of New York on September 30, 2008, on
behalf of QWI (Bankr. S.D.N.Y. Case No. 08-13814).  The chapter 15
case is before Judge James M. Peck.  Kenneth P. Coleman, Esq., at
Allen & Overy LLP, in New York, serves as counsel to the chapter
15 petitioner.

QWI and certain of its subsidiaries commenced the CCAA proceedings
before the Quebec Superior Court (Commercial Division) on
January 20, 2008.  The following day, 53 of QWI's U.S.
subsidiaries, including Quebecor World (USA), Inc., filed
petitions under Chapter 11 of the U.S. Bankruptcy Code.

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.

Quebecor World (USA) Inc., its U.S. subsidiary, along with other
U.S. affiliates, filed for chapter 11 bankruptcy before the U.S.
Bankruptcy Court for the Southern District of New York (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.

QWI is the only entity involved in the CCAA proceedings that is
not a Debtor in the Chapter 11 Cases.

As of June 30, 2008, Quebecor World's unaudited consolidated
balance sheet showed total assets of US$3,412,100,000 total
liabilities of US$4,326,500,000 preferred shares of US$62,000,000
and total shareholders' deficit of US$976,400,000.

The Hon. Robert Mongeon of the Quebec Superior Court has extended
until Dec. 14, 2008, the stay under the Canadian Companies'
Creditors Arrangement Act.


QUEBECOR WORLD: Files Amended Financial Results for 2007
--------------------------------------------------------
Quebecor World Inc., filed with the U.S. Securities and Exchange
Commission, on Form 40-F, its amended financial results for the
year ended December 31, 2007.  The amendments include disclosures
relating to the company's creditor protection under the Canadian
Companies' Creditors Arrangement Act and Chapter 11 of the United
States Bankruptcy Code, segmented information, and subsequent
events.

A full-text copy of the Amended Form 40-F is available for free
at http://ResearchArchives.com/t/s?36b1

                    Compensation of Directors

In the Form 40-F, QWI disclosed annual retainers and attendance
fees paid to members of the company's Board of Directors who do
not serve in any management function for QWI, its subsidiaries or
its controlling shareholder, Quebecor Inc.  QWI currently pays
its non-management directors compensation according to this
schedule:

  Position                           Compensation
  --------                           ------------
  Board Chair                          US$300,000
  Board                                US$100,000
  Lead Director                         US$10,000
  Audit Committee Chair                 US$10,000
  Other Committees Chair                 US$8,000
  Meeting Attendance Fees                US$2,500

QWI has established an executive stock option plan for its
executives in which its participants are granted options that may
be exercised to purchase Subordinate Voting Shares of QWI.  The
ESOP has been terminated for all future option grants and no
stock options to subscribe for Subordinate Voting Shares were
granted to the Named Executive Officers under the QWI's ESOP
during the financial year ended December 31, 2007.

QWI also maintains a basic pension plan for its non-unionized
Canadian employees, which also covers executive officers of QWI.
The pension is payable at the normal retirement age of 65 years
or from the age of 62, without reduction, if the participant has
completed a minimum of ten years of service with QWI.  A
participant contributes to the plan an amount equal to 5% of his
or her salary not exceeding $111,111 for 2007, up to a maximum of
$5,555 per year.  Effective January 1, 2008, the maximum pension
and participant contributions will be based on a salary of
$116,667.

Prior to the sale of QWI's European operations on June 26, 2008,
the company did not have a supplemental retirement plan for its
European-based executives.

             Compensation of the President and CEO

As part of its mandate, the Human Resources and Compensation
Committee reviewed the total compensation package of Jacques
Mallette who succeeded Wes W. Lucas as president and chief
executive officer of QWI on December 17, 2007.

Mr. Mallette receives:

  * an annual base salary of $1,000,000; and

  * an annual performance-based incentive award of 100% of his
    annual base salary based on the objectives approved by the
    Board, which may reach a maximum of 150% of his annual base
    salary for each financial year if the objectives approved by
    the Board are surpassed.

In the context of the Insolvency Proceedings, Mr. Mallette is
entitled to participate in the 2008/2009 MICP with an annualized
enhanced MICP target of 167% of his annual base salary in the
event the adjusted EBITDA objectives described above are
attained.

Mr. Lucas departed QWI with no lump-sum or severance amount
paid to him.  However, Mr. Lucas has filed a claim for roughly
$23 million with the Monitor under the Insolvency Proceedings.

                       Credit Facilities

The credit agreement of QWI and Quebecor World (USA), Inc., as
amended, provides for US$750,000,000 revolving credit facilities
that mature in January 2009.  The credit agreement contains
restrictive covenants and financial ratios as well as customary
events of default.

                         DIP financing

The courts overseeing QWI's CCAA and Chapter 11 Proceedings limit
the amounts of funding available for QWI's Latin America
subsidiaries to $10 million, in addition to a $5 million amount
for subsidiaries that are not Debtors.

As of December 12, 2008, $10 million was utilized to fund Latin
America subsidiaries, while a supplemental $3 million was used to
fund Latin America subsidiaries and other non-CCAA subsidiaries.
QWI is considering the future needs of its subsidiaries and will
request additional funding flexibility from its creditors, if
required.

                         Senior Notes

QWI has issued and outstanding various series of senior notes
and debentures:

  * US$150 million in aggregate principal amount of 6.50%
    Guaranteed Debentures due 2027, dated August 5, 1997, of
    which US$146,787,000 were tendered and repurchased at their
    par value on August 1, 2004 pursuant to their terms and
    US$3,213,000 remains outstanding;

  * on November 3, 2003, QWI issued US$200 million in aggregate
    principal amount of 4.875% Senior Notes due November 15,
    2008, and US$400 million in aggregate principal amount of
    6.125% of Senior Notes due November 15, 2013;

  * on July 12, 2000, Quebecor World Capital Corporation issued
    US$175 million in aggregate principal amount of 8.42% Series
    A Senior Notes due July 15, 2010, and US$75 million in
    aggregate principal amount of 8.52% Series B Senior Notes
    due 2012;

  * on September 12, 2000, Quebecor Capital issued US$91 million
    in aggregate principal amount of 8.54% of Series C Senior
    Notes due 2015 and US$30 million in aggregate principal
    amount of 8.69% Series D Senior Notes due 2020;

On December 28, 2006, QWUSA purchased a total of US$36 million
aggregate principal amount of the 8.54% senior notes due 2015, a
total of US$15 million aggregate principal amount of the 8.52%
senior notes due 2012 and a total of US$3.5 million of the 8.42%
senior notes due 2010 under cash tender offers.

In addition, on October 29, 2007, QWI repurchased all of its
outstanding 8.42% Senior Notes, Series A, due July 15, 2010,
8.52% Senior Notes, Series B, due July 15, 2012, 8.54% Senior
Notes, Series C, due September 15, 2015 and 8.69% Senior Notes,
Series D, due September 15, 2020 at a redemption price of 100% of
the outstanding principal amount of the Notes, plus the accrued
and unpaid interest on the notes to the redemption date plus the
applicable make-whole amount for an aggregate amount of US$376.3
million, which amount included both accrued interest and the
make-whole amount.

On March 6, 2006, Quebecor World Capital ULC, issued US$450
million in aggregate principal amount of 8.75% Senior Notes due
March 15, 2016 under an indenture entered into on the same date
with, among others, Citibank N.A., as trustee.  At any time and
from time to time, prior to March 15, 2009, Quebecor World
Capital ULC may redeem up to a maximum of 35% of the aggregate
principal amount of these Senior Notes at the applicable
redemption price set forth in the First 2006 Senior Notes
Indenture with the net cash proceeds from certain equity
offerings. In addition, prior to March 15, 2011, Quebecor World
Capital ULC may redeem some or all of these new Senior Notes at a
price equal to 100% of the principal amount plus accrued and
unpaid interest plus a "make-whole" premium.  After March 15,
2011, Quebecor World Capital ULC may redeem the Senior Notes, in
whole or in part, at the redemption prices specified in the First
2006 Senior Notes Indenture.

Wilmington Trust Company has succeeded Citibank, N.A. as trustee
under the First 2006 Senior Notes Indenture.

On December 18, 2006, QWI issued US$400 million in aggregate
principal amount of 9.75% Senior Notes due January 15, 2015 under
an indenture entered into on the same date with, among others,
Wilmington Trust Company, as trustee.  QWI may redeem 35% of
these Senior Notes on or prior to January 15, 2010 at the
applicable redemption price set forth in the Second 2006 Senior
Notes Indenture with the net cash proceeds of certain equity
offerings.  In addition, prior to January 15, 2011, QWI may
redeem these Senior Notes at a price equal to 100% of the
principal amount plus accrued and unpaid interest plus a "make-
whole" premium.  After January 15, 2011, QWI may redeem some or
all of the Senior Notes at the redemption prices specified in the
Second 2006 Senior Notes Indenture.

            Conversion of Series 5 Preferred Shares

On March 1, 2008, 3,975,663 Series 5 Cumulative Redeemable First
Preferred Shares were each converted into 12.93125 Subordinate
Voting Shares.  Consequently, approximately 51.4 million new
Subordinate Voting Shares were issued by QWI.

On June 1, 2008, 517,184 Series 5 Cumulative Redeemable First
Preferred Shares were each converted into 13.146875 Subordinate
Voting Shares.   Approximately 6.8 million new Subordinate Voting
Shares were issued by QWI.

On September 1, 2008, 744,124 Series 5 Cumulative Redeemable
First Preferred Shares were each converted into 13.3625
Subordinate Voting Shares of which 9.9 million new Subordinate
Voting Shares were issued by QWI.

Further, on December 1, 2008, 66,601 Series 5 Preferred Shares
were each converted into 13.578125 Subordinate Voting Shares.
Consequently, approximately 0.9 million new Subordinate Voting
Shares were issued by QWI.

            Long-Term Equipment Financing Program

On January 16, 2006, QWI concluded an agreement with Societe
Generale (Canada) for the Canadian dollar equivalent of a EUR136
million (US$160 million) long-term committed credit facility
relating to purchases of Manroland presses as part of QWI's North
American retooling program.  In October 2007, the facility was
partially secured by a lien on assets totaling US$34 million.

In light of the continuing Insolvency Proceedings, the facility
is no longer a relevant source of financing to QWI.

The Subordinate Voting Shares, each of which carries the right to
one vote, are restricted securities in that they do not carry
equal voting rights to the Multiple Voting Shares, each of which
carries the right to ten votes.  As of September 30, 2008, 24.6%
of all voting rights in QWI were attached to the Subordinate
Voting Shares.

The only person who beneficially owns or exercises control over
more than 10% of the shares of any class of voting shares of QWI
is Quebecor Inc., directly and through a wholly-owned subsidiary,
namely 4032667 Canada Inc.

As at September 30, 2008, Quebecor Inc. held a total of
46,911,277 Multiple Voting Shares, representing 99.84% of the
issued and outstanding Multiple Voting Shares and 75.23% of all
the voting rights in QWI.

                      Other Disclosures

As of December 31, 2007, QWI has outstanding shares of:

  * 85,584,924 Subordinate Voting Shares;
  * 46,987,120 Multiple Voting Shares;
  * 12,000,000 First Preferred Shares Series 3; and
  * 7,000,000 First Preferred Shares Series 5.

QWI paid its external auditor, KPMG LLP $12,216,000 for the year
ended December 31, 2007, and $13,630,000, for the year ended
December 31, 2006.

As of June 30, 2008, QWI employed approximately 20,000 people in
North America, of whom approximately 5,900 are covered by
45 separate collective agreements.  Nine collective agreements
covering approximately 300 employees are currently in
negotiation.  Of these, two collective agreements covering
approximately 130 employees expired in 2007, and five collective
agreements covering approximately 60 employees expired in 2006.

In addition, two collective agreements covering approximately 100
employees will expire in 2008 and are already in negotiation.
QWI also employed approximately 3,000 people in Latin America as
of June 30, 2008.  Of this number, majority of the Latin American
employees are either governed by agreements that apply industry-
wide or by a collective agreement.

In the normal course of business, QWI is involved in various
legal proceedings and claims.  In the opinion of the management
and QWI's subsidiaries, the outcome of these legal proceedings
and claims is not expected to have a material adverse effect on
the business, financial condition or results of QWI's operations.

                     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.

Ernst & Young, Inc., the monitor of Quebecor World Inc., and its
affiliates' reorganization proceedings under the Canadian
Companies' Creditors Arrangement Act, filed a petition under
Chapter 15 of the Bankruptcy Code before the U.S. Bankruptcy Court
for the Southern District of New York on September 30, 2008, on
behalf of QWI (Bankr. S.D.N.Y. Case No. 08-13814).  The chapter 15
case is before Judge James M. Peck.  Kenneth P. Coleman, Esq., at
Allen & Overy LLP, in New York, serves as counsel to the chapter
15 petitioner.

QWI and certain of its subsidiaries commenced the CCAA proceedings
before the Quebec Superior Court (Commercial Division) on
January 20, 2008.  The following day, 53 of QWI's U.S.
subsidiaries, including Quebecor World (USA), Inc., filed
petitions under Chapter 11 of the U.S. Bankruptcy Code.

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.

Quebecor World (USA) Inc., its U.S. subsidiary, along with other
U.S. affiliates, filed for chapter 11 bankruptcy before the U.S.
Bankruptcy Court for the Southern District of New York (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.

QWI is the only entity involved in the CCAA proceedings that is
not a Debtor in the Chapter 11 Cases.

As of June 30, 2008, Quebecor World's unaudited consolidated
balance sheet showed total assets of US$3,412,100,000 total
liabilities of US$4,326,500,000 preferred shares of US$62,000,000
and total shareholders' deficit of US$976,400,000.

The Hon. Robert Mongeon of the Quebec Superior Court has extended
until Dec. 14, 2008, the stay under the Canadian Companies'
Creditors Arrangement Act.


RAD/ONE: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------
Debtor: RAD/ONE, P.A.
        618 Frederick Drive
        Cleveland, MS 38732

Bankruptcy Case No.: 08-15517

Chapter 11 Petition Date: December 23, 2008

Court: United States Bankruptcy Court
       Northern District of Mississippi (Aberdeen)

Judge: Judge Neil P. Olack

Debtor's Counsel: Jeffrey A. Levingston, Esq.
                  Levingston & Levingston, PA
                  P. O. Box 1327
                  Cleveland, MS 38732
                  Tel.: (662) 843-2791
                  Email: jleving@bellsouth.net

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

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

A list of the Debtor's largest unsecured creditors is available
for free at:

        http://bankrupt.com/misc/msnb08-15517.pdf

The petition was signed by Jason Morris, President of the company.


RECYCLED PAPER: RPG Investment Balks at Sale to American Greeting
-----------------------------------------------------------------
RPG Investment Holdings LLC and funds affiliated with Monitor
Clipper Partners LLC strongly condemned American Greeting
Corporation's actions leading to its planned acquisition of
Recycled Paper Greetings Inc., an RPG Investment company in which
Monitor Clipper is a controlling investor.

On Dec. 30, 2008, American Greeting said it wants to acquire RPG
through a "pre-packaged" Chapter 11 filing.  American Greeting has
engaged in actions that RPG Investment and Monitor Clipper believe
are both unlawful and competitively damaging to the Chicago-based
greeting card company.

"We strongly oppose the actions taken by American Greetings
leading to the filing today of the bankruptcy," said Travis Metz,
an RPGI director and partner of MCP.  "We believe American
Greetings has been engaged in a series of actions that reflect its
own inability to compete effectively in the attractive humor
segment of the greetings card market.  Through its unlawful
actions, we believe American Greetings is attempting to eliminate
Recycled Paper Greetings as a competitor, in an effort to gain
more widespread traction in the lucrative market segment in which
Recycled Paper Greetings excels."

RPGI Investment has taken several actions to combat American
Greeting's unlawful activities, including pursuing litigation in
the U.S. District Court in Chicago which is ongoing.  This
litigation revolves around AG's unlawful purchase of a majority
interest in RPG Investment's senior debt, in direct violation of a
contractual obligation not to do so.  Had American Greeting not
breached this contract, RPGI Investment believes that it would
have been successful in its efforts to allow RPG to remain
independent and to allow the creditors, shareholders, employees,
artists and customers of RPG to each have achieved a better
outcome than the one currently contemplated in the bankruptcy
proceedings.

"MCP and RPGI are together committed to ensuring that Recycled
Paper Greeting's creditors, shareholders, employees, artists and
customers experience the best possible outcome in these
challenging circumstances," continued Mr. Metz.  "We will continue
to take actions and seek remedies to the maximum extent possible
to offset the harm to competition and the unlawful actions of
American Greetings. To this end, we intend to explore every
possibility available to us."

Headquartered in Chicago, Illinois, Recycled Paper Greetings Inc.
-- designs, manufactures, and distributes greetings cards and
social expression products throughout the U.S. and Canada.  RPG is
the third largest greeting card company in North America.  The
company and three of its affiliates filed for Chapter 11
protection on Jan. 2, 2009 (Bankr. D. Del. Lead Case No.
09-10002).  Michael F. Walsh, Esq., and Rachel Ehrlich Albanese,
Esq., at Weil, Gotshal & Manges LLP, represents the company as its
attorneys.  Mark D. Collins, Esq., Chun I. Jang, Esq., and Lee E.
Kaufman, Esq., at Richards, Layton & Finger, P.A., represents the
company as its local counsel.  The Debtors proposed Rothschild
Inc. as financial and restructuring advisor, and Kurtzman Carson
Consultants LLC as its claims and noticing agent.  When the
Debtors filed for protection from their creditors, they listed
assets and debts between $100 million to $500 million each.


RYLAND GROUP: Board of Directors Adopts Stockholder Rights Plan
---------------------------------------------------------------
The Ryland Group, Inc.'s board of directors has adopted a
stockholder rights plan designed to preserve stockholder value and
the value of certain tax assets associated with net operating loss
carryforwards under Section 382 of the Internal Revenue Code.

The company's ability to use its NOLs would be limited if there
was an "ownership change" under Section 382.  This would occur if
stockholders owning (or deemed under Section 382 to own) 5% or
more of the company's stock increase their collective ownership of
the aggregate amount of outstanding shares of Ryland by more than
50 percentage points over a defined period of time. The Rights
Plan was adopted to reduce the likelihood of an "ownership change"
occurring as defined by Section 382.

Under the Rights Plan, one right will be distributed for each
share of Common Stock of the company outstanding as of the close
of business on Dec. 29, 2008.  Effective Dec. 29, 2008, if any
person or group acquires 4.9% or more of the outstanding shares of
common stock of the company without the approval of the board of
Directors, there would be a triggering event causing significant
dilution in the voting power of such person or group.  However,
existing stockholders who currently own 4.9% or more of the
outstanding shares of common stock will trigger a dilutive event
only if they acquire additional shares.  The Rights Plan may be
terminated by the board at any time, prior to the Rights being
triggered.

The Rights Plan will continue in effect until Dec. 18, 2018,
unless it is terminated or redeemed earlier by the board of
directors. The company plans to submit the continuation of the
Rights Plan to a stockholder vote within the next 12 months, and
the failure to obtain this approval will result in termination of
the Rights Plan on Dec. 18, 2009.

A full-text copy of the RIGHTS AGREEMENT dated as of Dec. 18,
2008, is available for free at
http://ResearchArchives.com/t/s?3741

                        About Ryland Group

Based in Calabasas, California and founded in 1967, The Ryland
Group Inc. (NYSE: RYL) -- http://www.ryland.com/-- is one of the
nation's largest homebuilders and a leading mortgage-finance
company.  The company currently operates in 28 markets across the
country and has built more than 275,000 homes and financed more
than 230,000 mortgages since its founding in 1967.

For three months ended Sept. 30, 2008, the company posted net loss
of $65.7 million compared with net loss of $54.7 million for the
same period in the previous year.

For nine months ended Sept. 30, 2008, the company posted net loss
of $336.6 million compared with net loss of $131.6 million for the
same period in the previous year.

At Sept. 30, 2008, the company's balance sheet showed total assets
of $2.0 billion, total liabilities of $1.2 billion and
stockholders' equity of about $800.0 million.

At Sept. 30, 2008, the company's net debt-to-capital ratio was
35.9%, an increase from 34.6% at Dec. 31, 2007.

                          *     *     *

As reported in the Troubled Company Reporter on Dec. 16, 2008,
Fitch Ratings has downgraded Ryland Group, Inc.'s issuer default
rating and outstanding debt ratings: (i) IDR to 'BB' from 'BB+';
(ii) senior unsecured to 'BB' from 'BB+'; and (iii) unsecured bank
credit facility to 'BB' from 'BB+'.  The rating outlook remains
negative.


SMITTY'S BUILDING: Housing Slump Forces Bankruptcy Filing
---------------------------------------------------------
Smitty's Building Supply, Inc., filed for protection under Chapter
11 of the U.S. Bankruptcy Code in the United States Bankruptcy
Court for the Eastern District of Virginia, located in Alexandria,
Virginia, on January 5, 2009.

Company CEO Rick Smith stated that the unprecedented decline in
the housing industry caused the company to take this action.  Mr.
Smith emphasized that "our business will continue as normal."

In a letter to the company's employees, Mr. Smith stressed the
importance of Chapter 11 reorganization for companies like
Smitty's, whose operations are viable but whose financial
structures are overburdened.  "With Bank of America's support
through a post-filing loan facility, Smitty's is poised to
strengthen our business and continue to proudly serve our local
market."  Bank of America is providing Smitty's with a maximum
line of credit totaling $10.5 million, including $3.75 million in
post-filing debtor-in-possession financing.

Headquartered in Alexandria, Virginia, Smitty's supplies building
materials to home builders, remodelers and residential and
commercial contractors.   Andrew Currie, Esq., at Venable LLP and
Marc Weinsweig at FTI Consulting, Inc. are proposed debtors'
counsel and restructuring advisors to Smitty's.


SONICBLUE INC: Emerges from Bankruptcy; Liquidation Plan Effective
------------------------------------------------------------------
The first amended joint Chapter 11 plan of liquidation for
SONICblue's Inc. filed by the Chapter 11 trustee Dennis J.
Connolly and the reconstituted official committee of unsecured
creditors became effective.  The company emerged from Chapter 11
protection, Bloomberg News reports.

The Troubled Company Reporter on Oct. 27, 2008 reported the United
States Bankruptcy Court for the Northern District of California's
entry of an order confirming SonicBlue Inc.'s liquidating plan.

"The confirmation creates a post-confirmation committee, which
will direct how the rest of the case moves forward," said Ron
Oliner, a partner at Duane Morris partner, counsel to the
Reorganized Committee of General Unsecured Creditors.

Mr. Oliner said that distributions -- aggregating $77 million --
to creditors will be made by mid-November, while the remaining
amount of nearly $10 million will be kept as a reserve to pay for
ongoing administrative and litigation costs.

"What's left to resolve are primarily the litigations among the
law firms," Mr. Oliner added.

In April, Dennis Connolly, a partner in Alston & Bird, in Atlanta,
Georgia, and the Chapter 11 trustee in the case brought lawsuits
against Pillsbury Winthrop Shaw Pittman and Levene, Neale, Bender,
Rankin & Brill, seeking $15 million total from the two laws firms
for alleged malpractice.  A Nov. 17 hearing has been set in the
suit against Pillsbury to decide on the firm's request for a jury
trial for the $11 million suit it is facing.

The trustee is also seeking disgorgement of fees from both firms
-- $4.2 million for Pillsbury and $1.2 million for Levene, Neale.

The Recorder said that the Court terminated Pillsbury from the
case in March 2007 for failure to disclose a pre-bankruptcy
promise to creditors, which Pillsbury attorneys later described as
a "scrivener's error".  That disclosure failure is also part of
the April complaint.

As reported by the Troubled Company Reporter on Sept. 9, 2008,
Mr. Connolly made revisions to his plan of liquidation for the
Debtor and accompanying disclosure statement.  The first revision
to the plan and disclosure statement was delivered to the Court on
Aug. 22, 2008.  The second revision to the plan documents was
filed September 4.

The Official Committee of Unsecured Creditors of SONICblue, as
reconstituted, is a co-proponent to the liquidation plan.

                         Plan Provisions

Substantially all of the Debtors' assets other than certain estate
litigation claims have already been reduced to cash.  If any
assets have not been liquidated by the effective date of the Plan,
a plan administrator, in consultation with a post-confirmation
committee, will liquidate those Assets in accordance with the
terms of the First Amended Plan.  The Plan Administrator will
distribute the Cash and the proceeds of the Assets (net of
expenses) to creditors in accordance with the Plan's terms.

The Chapter 11 Trustee will initially serve as Plan Administrator.

The Plan Proponents anticipate that roughly $77,000,000 will be
available for distribution to Holders of Allowed Claims as part of
an initial distribution.  Holders of Allowed Administrative
Claims, Priority Tax Claims, and Priority Claims, as well as
Holders of Allowed Secured Claims, will be paid in full.

Holders of 7-3/4% Secured Senior Subordinated Convertible
Debentures issued by SONICblue in 2002 and due in 2005, in an
aggregate principal amount not to exceed $75,000,000, will receive
roughly 56% of the Allowed Amount of their Claims.  Trade and
other general unsecured creditors are expected to receive cash
equal to roughly 38.0% of the Allowed Unsecured Claim.

General Unsecured Creditors may receive payments as additional
Assets become available for distribution.  The principal source of
those additional payments, if any, will be Estate Litigation
Claims, including claims against counsel who formerly represented
the Debtors and the initial creditors committee in the case.

Holders of SONICblue's 5-3/4% Convertible Subordinated Notes
issued in 1996 and due in 2003 are subordinated to the payment in
full of the 2002 Noteholders. Because there are insufficient
Assets in the Debtors' Estates to repay the 2002 Notes in full,
the Plan Proponents believe that no Assets are available to repay
the 1996 Notes.

However, as part of as part of a settlement among the Chapter 11
Trustee, the Reconstituted Creditors Committee and the 2002
Noteholder, Holders of 1996 Notes may receive under the First
Amended Plan roughly 0.9% of the Allowed Claim in the event:

   -- the Settlement is approved as part of the First Amended
      Plan, and the Plan is confirmed and becomes effective,

   -- Holders of 1996 Notes votes to accept the First Amended
      Plan, and

   -- no Holder of a 1996 Notes or the 1996 Notes Indenture
      Trustee objects to confirmation of the First Amended Plan.

Pursuant to the Settlement, the 2002 Noteholders will contribute
at least roughly $8.2 million in initial Cash distributions to
Unsecured Creditors under the First Amended Plan, and more if
additional distributions become available.

Shareholders get nothing under the Plan.

As of June 30, 2008, the Chapter 11 Trustee held approximately
$85.8 million in Cash.

                       About SONICblue Inc.

SONICblue Inc. is a consumer electronics company.  Prior to
January 2001, SONICblue's primary business was to supply graphics
and multimedia accelerator subsystems for personal computers.
SONICblue completed the acquisition of ReplayTV, Inc., a developer
of personal television technology, on August 1, 2001.  SONICblue
completed the acquisition of Sensory Science, a developer of
consumer electronics products, including dual deck videocassette
player/recorders and DVD players, on June 27, 2001.  Debtor
Diamond Multimedia Systems Inc. was an established PC original
equipment manufacturer and retail provider of communications and
home networking solutions, PC graphics and audio add-in boards and
digital audio players.

SONICblue Inc. and its debtor-affiliates filed for chapter 11
bankruptcy on March 21, 2003, before the U.S. Bankruptcy Court for
the Northern District of California (Lead Case No. 03-51775).  The
Debtors employed Pillsbury Winthrop Shaw Pittman LLP formerly
Pillsbury Winthrop LLP as their bankruptcy counsel.  Houlihan
Lokey Howard & Zukin Capital served as their financial advisors.

Early into the case, the U.S. Trustee appointed an official
creditors' committee in the case. On Oct. 4, 2007, the Bankruptcy
Court directed the U.S. Trustee to reconstitute the
Initial Creditors' Committee.

The Initial Creditors' Committee retained Levene, Neale, Bender,
Rankin & Brill LLP as bankruptcy counsel; and Alliant Partners, as
financial advisors.

On March 26, 2007, the Bankruptcy Court disqualified Pillsbury as
the Debtors' bankruptcy counsel and ordered the appointment of a
chapter 11 trustee for the Debtors.  On April 17, 2007, the Court
granted the U.S. Trustee's request to appoint Dennis J. Connolly,
Esq., as the Chapter 11 Trustee.

The U.S. Trustee appointed on Oct. 23, 2007, a reconstituted
Creditors' Committee -- comprised of Korea Export Insurance
Corporation, Riverside Contracting LLC & Riverside Claims LLC,
Synnex K.K., TLI Holdings, Inc., Michelle Miller, and York Capital
Opportunity Fund.  York Capital Opportunity Fund was later
appointed Chair of the Reconstituted Creditors' Committee and
Synnex K.K. subsequently resigned as a member.

Grant T. Stein, Esq., at Alston & Bird LLP in Atlanta, Georgia;
and Cecily A. Dumas, Esq., at Friedman Dumas & Springwater LLP in
San Francisco, California, represent the Chapter 11 Trustee.
Grobstein Horwath serves as accountants to the Chapter 11 Trustee.
Aron M. Oliner, Esq., Mikel R. Bistrow, Esq., and Geoffrey A.
Heaton, Esq., at Duane Morris LLP, in San Francisco, represent the
Reconstituted Creditors' Committee.


SONORA ENVIRONMENTAL: Voluntary Chapter 11 Case Summary
-------------------------------------------------------
Debtor: Sonora Environmental, LLC
        25 N. Longmore
        Mesa, Az 85201
        Tel: (602) 326-9811

Bankruptcy Case No.: 09-00030

Type of Business: The Debtor sells concrete, sand and gravel.

Chapter 11 Petition Date: January 4, 2009

Court: District of Arizona (Phoenix)

Judge: Charles G. Case II

Debtor's Counsel: Tracy S. Essig, Esq.
                  tracyessiglaw@cox.net
                  Law Office of Tracy S. Essig
                  3509 E. Shea Blvd., Suite 117
                  Phoenix, AZ 85028
                  Tel: (602) 493-2326
                  Fax: (602) 482-3164

Estimated Assets: $50 million to $100 million

Estimated Debts: $10 million to $50 million

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

The petition was signed by the company's managing member Lee A.
Jolley.


SOUTHERN TRACE: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Southern Trace Holding Co., L.L.C.
        1040 Dauphin Island Parkway
        Mobile, AL 36605

Bankruptcy Case No.: 08-15153

Chapter 11 Petition Date: December 24, 2008

Court: United States Bankruptcy Court
       Southern District of Alabama (Mobile)

Judge: Judge Margaret A. Mahoney

Debtor's Counsel: Michael B. Smith, Esq.
                  P.O. Box 40127
                  Mobile, AL 36640
                  Tel.: (251)441-8077
                  Email: smi067@aol.com

Estimated Assets: $1,000,000 to $100,000,000

Estimated Debts: $1,000,000 to $100,000,000

A full-text copy of the Debtor's petition and a list of the
Debtor's largest unsecured creditors are available for free at:

        http://bankrupt.com/misc/alsb08-15153.pdf

The petition was signed by Daren Benandi, Managing Member of the
company.


STANDARD PACIFIC: Board Elects Ken Campbell as President and CEO
----------------------------------------------------------------
Standard Pacific Corp.'s board of directors has elected Ken
Campbell as president and chief executive officer of the company.
Mr. Campbell is a partner of MatlinPatterson Global Advisors LLC,
a private equity firm, and Standard Pacific's largest shareholder.
Mr. Campbell succeeds Jeffrey V. Peterson who has stepped down as
chairman, chief executive officer and president of the company and
is continuing as a director of the company.

Director and co-founder of the company, Ronald R. Foell, has
accepted the role of non-executive chairman of the board of the
company.  Mr. Foell brings over forty years of homebuilding
experience to this position and served as president of the company
from 1969 through 1996.

"We are pleased that [Mr.] Campbell has agreed to serve as the
company's new president and chief executive officer," Mr. Foell
stated.  "We believe that [Mr. Campbell's] extensive experience in
restructuring operations, achieving cost savings and developing
more efficient operations will complement the company's ongoing
efforts in these areas and will help the company to return to its
position as a profitable, market-leading homebuilder."

"We would also like to thank [Mr.] Peterson for stepping in as the
company's chief executive officer during a critical period in its
history," Mr. Foell stated.  "[Mr. Peterson] acted decisively in
leading the company and achieved a significant refinancing of its
balance sheet in the midst of one of the most challenging capital
markets environments.   These actions have positioned the company
to weather the current downturn more effectively and to better
compete as market conditions improve."

                   About Standard Pacific Corp.

Headquartered in Irvine, California, Standard Pacific Corp. (NYSE:
SPF) -- http://www.standardpacifichomes.com/-- operates in many
of the largest housing markets in the country with operations in
major metropolitan areas in California, Florida, Arizona, the
Carolinas, Texas, Colorado and Nevada.  The company also provides
mortgage financing and title services to its homebuyers through
its subsidiaries and joint ventures, Standard Pacific Mortgage
Inc., SPH Home Mortgage and SPH Title.

As reported in the Troubled Company Reporter on Nov. 4, 2008,
Standard Pacific Corp. reported the company's unaudited 2008 third
quarter operating results.  The net loss for the quarter ended
Sept. 30, 2008, was $368.8 million compared to a net loss of
$119.7 million in the year earlier period.

At Sept. 30, 2008, the company's balance sheet showed total assets
of $2.6 billion, total liabilities of $1.9 billion and
shareholders' equity of $788.1 million.

                         *     *     *

As reported in the Troubled Company Reporter on Aug. 27, 2008,
Fitch Ratings has affirmed and removed Standard Pacific Corp.'s
Issuer Default and outstanding debt ratings from Rating Watch
Negative as: (i) IDR at 'B-'; (ii) secured borrowings under bank
revolving credit facility at 'BB-/RR1'; (iii) unsecured borrowings
under bank revolving credit facility at 'B-/RR4'; (iv) senior
unsecured at 'B-/RR4'; and (v) senior subordinated debt at
'CCC/RR6'.  Standard Pacific's outlook is stable.


SUN-TIMES MEDIA: Inks Severance Deals with 2 Executives
-------------------------------------------------------
Sun-Times Media Group, Inc., entered into a Key Employee Severance
Program Participation Agreement with Blair Richard Surkamer,
executive vice president and chief operating officer of the
company, which supersedes all prior severance agreements between
the company and Mr. Surkamer and is intended to substantially
conform Mr. Surkamer's severance benefits with those of other
senior executives of the company.

The Surkamer Severance Agreement provides that in the event
Mr. Surkamer's employment is terminated by the company other than
for cause or as a result of death or permanent disability prior to
a change in control, Mr. Surkamer will receive these:

   i) a lump sum payment for any accrued, unused vacation time,
      reduced by all applicable tax withholding requirements;
  ii) a lump sum payment equal to Mr. Surkamer's then current
      target bonus;
iii) continuation of Mr. Surkamer's base salary in effect on the
      date of termination, payable in the same manner that
      Mr. Surkamer's payroll is handled, less all appropriate
      withholding amounts and deductions, for the one-year period
      immediately after Mr. Surkamer's termination; and
  iv) continuation of all then-current welfare benefit programs
      in which Mr. Surkamer participates on the date of his
      termination of employment, subject only to Mr. Surkamer's
      continued premium contributions at the same level as on the
      date of termination, for the one-year period immediately
      after Mr. Surkamer's termination.

In the event of a change in control, and the subsequent
termination of Mr. Surkamer's services by the company other than
for cause or as a result of death or permanent disability or by
Mr. Surkamer for good reason, Mr. Surkamer will receive these:

   i) a lump sum payment for any accrued, unused vacation time,
      reduced by all applicable tax withholding requirements;
  ii) a lump sum payment equal to Mr. Surkamer's then current
      target bonus multiplied by 2;
iii) continuation of Mr. Surkamer's base salary in effect on the
      date of termination, payable in the same manner that
      Mr. Surkamer's payroll is handled, less all appropriate
      withholding amounts and deductions, for the two-year period
      immediately after Mr. Surkamer's termination; and
  iv) continuation of all then-current welfare benefit programs
      in which Mr. Surkamer participates on the date of his
      termination of employment, subject only to Mr. Surkamer's
      continued premium contributions at the same level as on the
      date of termination, for the one-year period immediately
      after Mr. Surkamer's termination.  In the event of a change
      in control that is a Stock Acquisition Change in Control or
      a Disposition Change in Control, and the subsequent
      termination of Mr. Surkamer's services by Mr. Surkamer for
      good reason, Mr. Surkamer will not be entitled to the
      severance benefits described above if, in connection with
      the change in control, he is offered a position
      substantially similar to his then position or he is
      employed by the purchaser in such change in control within
      one year after the change in control. Under the terms of
      the Surkamer Severance Agreement and of the equity-based
      awards he has been granted by the company, all unexpired
      equity-based awards then held by Mr. Surkamer will vest
      upon a change in control.  The term of the Surkamer
      Severance Agreement runs from the Surkamer Effective Date
      until the second anniversary of the Surkamer Effective Date
      and will automatically renew for successive 1 year
      intervals thereafter unless the company shall have given at
      least 180 days advance written notice to Mr. Surkamer of
      the cessation of the automatic renewal.  Mr. Surkamer has
      agreed that during his employment with the company, and for
      a period of one year after the effective date of his
      termination from the company for whatever reason, he will
      be subject non-solicitation provisions as set forth in the
      Surkamer Severance Agreement.

For purposes of the Surkamer Severance Agreement, a "change in
control" of the company is deemed to have occurred upon:

   a) the acquisition of securities of the company representing
      more than 50% of the combined voting power of the company's
      then outstanding securities; or

   b) the entry into a plan or agreement for a reorganization,
      merger or consolidation, or sale or other disposition of
      all or substantially all of the assets of the company; or

   c) the members of the board of directors as of the Surkamer
      Effective Date and any new directors whose election by the
      board or nomination by the Board for election was approved
      by a vote of a least two-thirds of the directors then still
      in office who either were in office on the Surkamer
      Effective Date or whose election or nomination for election
      was so approved ceasing for any reason to constitute at
      least a majority of the board.

Under the terms of the Surkamer Severance Agreement, "cause" means

   i) Mr. Surkamer engaging in intentional and willful
      misconduct, including a breach of his duty of loyalty to
      the company, to the detriment of the company, or (ii) Mr.
      Surkamer being convicted of, or entering a plea of nolo
      contendere to, a crime involving fraud, dishonesty or
      violence.  Under the terms of the Surkamer Severance
      Agreement, "good reason" means the occurrence of a change
      in control followed by Mr. Surkamer experiencing (i) a
      material reduction in base salary, title, authority or
      responsibilities, (ii) required relocation more than 50
      road miles from the office where Mr. Surkamer works, or
      (iii) the failure of the company to obtain an explicit
      undertaking from any successor to honor the terms of the
      Surkamer Severance Agreement.

                  Severance Deal with CFO

On Dec. 23, 2008, the company entered into a Key Employee
Severance Program Participation Agreement with David C. Martin,
who became senior vice president and chief financial officer of
the company on Nov. 25, 2008, which supersedes all prior severance
agreements between the company and Mr. Martin.  The Martin
Severance Agreement provides that in the event Mr. Martin's
employment is terminated (a) by the company other than for cause
or as a result of death or permanent disability, or (b) by Mr.
Martin for good reason, Mr. Martin will receive these: (i) a lump
sum payment for any accrued, unused vacation time, reduced by all
applicable tax withholding requirements; (ii) a lump sum payment
equal to Mr. Martin's then current target bonus; (iii)
continuation of Mr. Martin's base salary in effect on the date of
termination, payable in the same manner that Mr. Martin's payroll
is handled, less all appropriate withholding amounts and
deductions, for the one-year period immediately following Mr.
Martin's termination; and (iv) continuation of all then-current
welfare benefit programs in which Mr. Martin participates on the
date of his termination of employment, subject only to Mr.
Martin's continued premium contributions at the same level as on
the date of termination, for the one-year period immediately
following Mr. Martin's termination.  In the event of a change in
control that is a Stock Acquisition Change in Control or a
Disposition Change in Control, and the subsequent termination of
Mr. Martin's services by Mr. Martin for good reason, Mr. Martin
will not be entitled to the severance benefits described above if,
in connection with such change in control, he is offered a
position substantially similar to his then current position or he
is employed by the purchaser in such change in control within one
year following such change in control. Under the terms of the
Martin Severance Agreement and of the equity-based awards he has
been granted by the company, all unexpired equity-based awards
then held by Mr. Martin will vest upon a change in control.

The term of the Martin Severance Agreement runs from the Martin
Effective Date until the second (2nd) anniversary of the Surkamer
Effective Date and shall automatically renew for successive one
(1) year intervals thereafter unless the company shall have given
at least 180 days advance written notice to Mr. Martin of the
cessation of the automatic renewal.  Mr. Martin has agreed that
during his employment with the company, and for a period of one
year after the effective date of his termination from the company
for whatever reason, he will be subject non-solicitation
provisions as set forth in the Martin Severance Agreement.
"Cause," "good reason" and "change in control" are defined
identically in the Martin Severance Agreement as in the Surkamer
Severance Agreement.

                      About Sun-Times Media

Headquartered in Chicago, Sun-Times Media Group Inc. (NYSE: SVN)
-- http://www.thesuntimesgroup.com/-- is a newspaper publisher.
Its media properties include the Chicago Sun-Times and
Suntimes.com as well as newspapers and Web sites serving more than
200 communities throughout the Chicago area.

The Troubled company Reporter reported on Aug. 14, 2008, that at
June 30, 2008, Sun-Times Media Group Inc.'s consolidated balance
sheet showed $721.2 million in total assets and $870.8 million in
total liabilities, resulting in a roughly $149.5 million
stockholders' deficit.  The company reported a net loss in the
second quarter of 2008 of $37.8 million, versus net income of
$528.0 million in the same period in 2007.

On Aug. 1, 2007, Hollinger Inc. -- http://www.hollingerinc.com/--
which owns approximately 70.0% voting and 19.7% equity interest in
Sun-Times Media Group Inc., along with two affiliates, 4322525
Canada Inc. and Sugra Limited, filed separate Chapter 15 petitions
(Bankr. D. Del. Case Nos. 07-11029 through 07-11031).  Hollinger
also initiated Court-supervised restructuring under the Companies'
Creditors Arrangement Act (Canada) on the same day.

As reported in the Troubled company Reporter on Nov. 26, 2008,
Sun-Times Media Group, Inc.'s balance sheet at Sept. 30, 2008,
showed total assets of $479.9 million, total liabilities of
$801.7 million, resulting in a stockholders' deficit of roughly
$321.8 million.

Sun-Times Media reported a net loss in the third quarter ended
Sept. 30, 2008, of $168.8 million compared with a loss of
$192.4 million in the same period in 2007.

                            *    *    *

The Troubled Company Reporter said on Nov. 26, 2008, that Sun-
Times Media Group, Inc.'s balance sheet at Sept. 30, 2008, showed
total assets of $479.9 million, total liabilities of
$801.7 million, resulting in a stockholders' deficit of roughly
$321.8 million.


TRONOX INC: Has Until January 9 to Pay Interest on $350MM Loan
--------------------------------------------------------------
Tronox Incorporated disclosed in a filing with the Securities and
Exchange Commission that its subsidiary Tronox Worldwide LLC
entered into a Third Waiver Extension with certain lenders under
the Credit Agreement, dated as of Nov. 28, 2005, with the lenders
from time to time parties thereto, Lehman Brothers Inc. and Credit
Suisse, as joint lead arrangers and joint bookrunners, ABN Amro
Bank N.V., as syndication agent, JPMorgan Chase Bank, N.A. and
Citicorp USA, Inc., as co-documentation agents, and Lehman
Commercial Paper Inc., as administrative agent.

The agreement was amended by the First Amendment dated as of
March 12, 2007, the Second Amendment to the Credit Agreement and
First Amendment to Guarantee and Collateral Agreement dated as of
Feb. 8, 2008, the Third Amendment to the Credit Agreement and
Second Amendment to Guarantee and Collateral Agreement dated as of
July 17, 2008, the Waiver and Amendment to Credit Agreement dated
Oct. 28, 2008, the Waiver Extension to the Credit Agreement, dated
as of Nov. 20, 2008, and the Second Waiver Extension to the Credit
Agreement, dated Dec. 4, 2008.

Tronox Worldwide LLC, a subsidiary of Tronox Incorporated did not
make a scheduled payment of interest when due on Dec. 1, 2008, on
its $350,000,000 of 9-1/2% Senior Notes due 2012 issued pursuant
to that certain Indenture, dated as of Nov. 28, 2005, among Tronox
Worldwide LLC, Tronox Finance Corp., and Citibank, N.A, as
trustee.  Failure to make such interest payment within 30 days of
December 1, 2008 would constitute an event of default under the
indenture governing the notes, permitting holders of at least 25%
in principal amount of the notes to declare the full amount of the
notes immediately due and payable.

Pursuant to the Waiver and Amendment, lenders holding a majority
of the aggregate principal amount of loans under the Credit
Agreement agreed to waive certain defaults and events of default
that may have occurred due to the Tronox Worldwide's (i) failure
to comply for the period of four consecutive fiscal quarters
ending Sept. 30, 2008, with Section 7.1(a) of the Credit
Agreement, which requires maintenance of a maximum Consolidated
Total Leverage Ratio, and Section 7.1(b) of the Credit Agreement,
which requires maintenance of a minimum Consolidated Interest
Coverage Ratio, and (ii) submission of the Borrowing Notice on
Sept. 30, 2008, or receipt of any proceeds in respect thereof, at
a time when any default or event of default referred to in clause
(i) above had occurred and was continuing.

The Third Waiver Extension amended the term "Waiver Period"  to
extend the period from Dec. 19, 2008, to Jan. 9, 2009.  As a
result, the Waiver has been extended to expire upon the earlier to
occur of (i) January 2009 and (ii) the occurrence of any event of
default (other than any default waived pursuant to the Waiver and
Amendment) and delivery by any of the lenders of a notice to the
Tronox Worldwide, while the event of default is continuing,
stating that the Waiver is being terminated; provided that the
Waiver Period will terminate automatically and with no further
action by the Tronox Worldwide or the lenders in the event that
holders of Tronox Worldwide's Senior Notes exercise any right or
remedy under the Senior Note Indenture in respect of the
occurrence of an event of default thereunder, including but not
limited to an event of default relating to Tronox Worldwide's
failure to make the scheduled interest payment due on the Senior
Notes on Dec. 1, 2008.

A full-text copy of the THIRD WAIVER EXTENSION is available for
free at http://ResearchArchives.com/t/s?3744

On Dec. 4, 2008, the company and Tronox Worldwide entered into a
Second Waiver Extension with lenders.  The Second Waiver Extension
has extended the waiver period until Dec. 19, 2008.

On Nov. 20, 2008, Tronox Incorporated and its subsidiary Tronox
Worldwide LLC with certain lenders to extend the waiver period
until Dec. 5, 2008.

There is no assurance that the company will not be in default
under the Credit Agreement in the future.  If the company were to
be in default under the Credit Agreement, its ability to borrow
under the Credit Agreement would be impaired and the lenders could
declare a default which could ultimately cause all amounts due
under the Credit Agreement to become immediately due and payable.

On Dec. 19, 2008, Tronox Funding LLC and the Tronox Worldwide
entered into the Sixth Amendment to the Receivables Sale Agreement
with The Royal Bank of Scotland plc and Amsterdam Funding
Corporation, dated as of Sept. 26, 2007.  Amendment No. 6 amended
the term "Scheduled Termination Date" in the Sale Agreement to
extend such date from Dec. 19, 2008, to Jan. 9, 2009.

A full-text copy of the Sixth Amendment to Receivables Sale
Agreement is available for free at
http://ResearchArchives.com/t/s?3745

On Dec. 5, 2008, Tronox Funding and the Tronox Worldwide entered
into the Fifth Amendment to Receivables Sale Agreement extending
the date Dec. 19, 2008.

On Nov. 25, 2008, Tronox Funding and Tronox Worldwide LLC entered
into the Fourth Amendment to Receivables Sale Agreement extending
the period until Dec. 5, 2008.

There is no assurance that the Seller and the Tronox Worldwide
will be able to obtain additional amendments or waivers to the
Sale Agreement, or that a Termination Event will not occur under
the Sale Agreement in the future.  The occurrence of a Termination
Event in the future would adversely affect the rights of the
Seller under the Sale Agreement.

The company stated that it is evaluating all strategic options
including mitigation of environmental liabilities and capital
restructuring.

                            About Tronox

Headquartered in Oklahoma City, Tronox Incorporated (NYSE:TRX) --
http://www.tronox.com/-- is a producer and marketer of titanium
dioxide pigment, an inorganic white pigment used in paint,
coatings, plastics, paper and many other everyday products. The
company's five pigment plants, which are located in the United
States, Australia, Germany and the Netherlands, supply performance
products to approximately 1,100 customers in 100 countries.  In
addition, Tronox produces electrolytic products, including sodium
chlorate, electrolytic manganese dioxide, boron trichloride,
elemental boron and lithium manganese oxide.

Bloomberg says the company is the world's third largest maker of
titanium dioxide.  According to Bloomberg, DuPont Co. is the
largest maker of the chemical, followed by Saudi-owned National
Titanium Dioxide Co., known a Cristal.

Tronox has $1.6 billion in total assets, including $646.9 million
in current assets, as at September 30, 2008.  The company has
$881.6 million in current debts and $355.9 million in total
noncurrent debts.

Tronox has retained the investment banking firm Rothschild Inc. to
further assist the company in evaluating strategic options for the
business.

As of December 4, Robert Y. Brown, III, Tronox Incorporated vice
president of strategic planning and business services was no
longer with the company.

As of December 4, 2008, Robert Y. Brown, III, Tronox Incorporated
vice president of strategic planning and business services is no
longer with the company.


TRUMP ENTERTAINMENT: Interest Non-Payment Cues Moody's 'D' Rating
-----------------------------------------------------------------
Moody's Investors Service lowered Trump Entertainment Resorts
Holdings, L.P.'s Probability of Default Rating to D from Ca.  This
rating action reflects the company's recent disclosure that it has
not paid the $53.1 million December 1, 2008 scheduled interest
payment on its 8.5% senior secured second lien notes due 2015
within the 30-day grace period allowed by the indenture governing
the notes.  Trump's Ca Corporate Family Rating, Ca senior secured
second lien note rating, and SGL-4 Speculative Grade Liquidity
rating were affirmed.  The rating outlook is negative.

Trump has obtained a forbearance agreement from the holders of
approximately 70% of the outstanding principal amount of its
senior secured second lien notes pursuant to which the note
holders have agreed to forbear from exercising their rights and
remedies under the indenture governing the notes until January 21,
2009.  The company has also obtained a forbearance agreement from
the lenders under its $490 million senior secured term loan
agreement pursuant to which the lenders have agreed to forbear
from exercising certain of their rights and remedies until January
21, 2009.

The negative outlook continues to recognize that while Trump
remains in discussions with its lenders and certain note holders
regarding a possible restructuring of its capital structure, there
is no assurance that any agreement with respect to any
restructuring will be reached.

This rating was lowered:

  -- Probability of Default Rating to D from Ca

These ratings were affirmed:

  -- Corporate Family Rating at Ca

  -- $1.25 billion senior secured second lien notes due 2015 at Ca
     (LGD4, 64%)

  -- SGL-4 Speculative Grade Liquidity rating

Moody's previous rating action related to Trump occurred on
December 1, 2008 when Moody's revised the company's Probability of
Default Rating to Ca from Caa2, and Corporate Family Rating to Ca
from Caa1.

Trump Entertainment Resorts Holdings, LP owns and operates the
Trump Taj Mahal Casino Resort, Trump Plaza Hotel and Casino and
the Trump Marina Hotel Casino in Atlantic City, New Jersey.  Net
revenue for the latest 12-months ended September 30, 2008 was
about $954 million.


US INVESTIGATIONS: Moody's Affirms 'B3' Rating With Stable Outlook
------------------------------------------------------------------
Moody's Investors Service affirmed the ratings of US
Investigations Services, Inc. and stable outlook.  Despite
challenges relating to cyclical pressures on the commercial side,
the stable outlook recognizes technological and operational
improvements which have positively impacted margins and helped
reduce financial leverage over the last several quarters, as well
as prospective technological benefits from the HireRight
acquisition.

The company's ratings continue to be constrained by high financial
leverage and the negative near-term effect of the employment
outlook on the company's commercial employment screening
businesses.  The preponderance of government revenues presents
risks from a diversification standpoint and, despite accelerated
revenue growth in recent quarters to reduce backlogs, limits
revenue growth opportunities.  Moreover, the company's efforts to
diversify are likely to continue to entail both acquisition and
integration risks, as well as the possibility that large premiums
relative to near-term cash flow could be paid for otherwise
attractive targets, as was the case for HireRight.

The company benefits from its scale relative to competitors, its
leading market position, and barriers to entry, including
technological expertise and incumbent advantages.  Core
competencies include systems and processes (including technology
acquired through the HireRight transaction) to collect and analyze
large volumes of data from public and non-public sources.  Given
the current economic environment and likely growth of the US
public sector, concentration with the US government for the
majority of the company's revenues constitutes a near-term credit
positive.

Moody's took these rating actions:

  -- Affirmed the B3, Corporate Family Rating;

  -- Affirmed the B3, Probability of Default Rating;

  -- Affirmed the B1 (LGD3, 31%) rating on the $90 million senior
     secured first lien revolver due 2013;

  -- Affirmed the B1 (LGD3, 31%) rating on the $827 million senior
     secured first lien term loans due 2015 (including the new
     $110 million Term Loan C under the existing loan agreement
     used to finance the HireRight acquisition);

  -- Affirmed the Caa2 (LGD5, 81%) rating on $290 million senior
     unsecured notes due 2015;

  -- Affirmed the Caa2 (LGD6, 94%) rating on $150 million senior
     subordinated notes due 2016;

The outlook for the ratings is stable.

The previous rating action was on October 25, 2007 when Moody's
assigned ratings to the company's $290 million senior unsecured
notes and $150 million senior subordinated notes which replaced
corresponding bridge facilities.  The B3 Corporate Family Rating
was affirmed.

US Investigations Services, Inc., with corporate headquarters in
Falls Church, Virginia, is a leading provider of security-
clearance background investigation and employment screening
services to government agencies and commercial customers in the
United States.  Revenues for the 2008 fiscal year which ended
September 30, 2009 were about $890 million, adjusted for certain
one-time revenue items.


USP SPC: S&P Downgrades Rating Senior Notes to 'D' From 'CCC-'
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on the notes
issued by USP SPC, acting for the account of Jackson 2006-I, to
'D' from 'CCC-'.

The downgrade reflects the reduction of the outstanding principal
amount of the notes from USP SPC, acting for the account of
Jackson 2006-I, to zero due to cash settlement payments related to
various credit events.

                          Rating Lowered

                             USP SPC
                          Jackson 2006-I

                                   Rating
                                   ------
                     Class       To     From
                     -----       --     ----
                     SrNotes     D      CCC-


VCENTRIX, INC.: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: vCentrix, Inc.
        19 Crosby Drive, Suite #200
        Bedford, MA 01730
        Tel.: (617) 904-5013
        Fax : (617) 904-5001
        Web site: http://www.vcentrix.net/

Bankruptcy Case No.: 08-44160

Type of Business: Telecommunications

Chapter 11 Petition Date: December 23, 2008

Court: United States Bankruptcy Court
       District of Massachusetts (Worcester)

Judge: Judge Joel B. Rosenthal

Debtor's Counsel: John F. Drew, Esq.
                  Burns & Levinson, LLP
                  125 Summer Street
                  Boston, MA 02110
                  Tel.: (617) 345-3292
                  Fax : (617) 345-3299
                  Email: jdrew@burnslev.com

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

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

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

The petition was signed by Talal Ali Ahmad, president of the
company.


VITESSE SEMICONDUCTOR: Auditor Raises Going Concern Doubt
---------------------------------------------------------
BDO Seidman, LLP, in Los Angeles, California, in a letter dated
December 30, 2008, to the Board of Directors and Shareholders of
Vitesse Semiconductor Corporation expressed substantial doubt
about the company's ability to continue as a going concern.

The firm audited the consolidated balance sheets of Vitesse
Semiconductor Corporation and subsidiaries as of September 30,
2008 and 2007 and the related consolidated statements of
operations, shareholders' equity and comprehensive loss, and
cash flows for each of the three years in the period ended
September 30, 2008.

BDO Seidman noted that the company is subject to an October 1,
2009, put on its convertible subordinated debt that would
potentially require the company to repay the principal amount of
the convertible subordinated debt plus a premium to the debt
holders.  "The existence of this put feature raises substantial
doubt about the company's ability to continue as a going concern."

Chief Executive Officer Christopher R. Gardner disclosed in a
regulatory filing that the company has incurred net losses
historically and has used cash in operating activities, and has an
accumulated deficit of $1.6 billion as of December 31, 2007. "The
company also has significant contractual obligations related to
its debt for the fiscal year 2009 and beyond. Management believes
we have sufficient resources to fund our normal operations over
the next 12 months, through at least September 30, 2009. However,
holders of our 1.5% Convertible Subordinated Debentures due 2024
have the right to require us to repurchase the 2024 Debentures on
October 1 of 2009, 2014, and 2019. In accordance with the
November 3, 2006, amendment to the 2024 Debentures, the October 1,
2009, repurchase right was increased from 100% to 113.76% of the
principal amount of the 2024 Debentures to be purchased. The
increase in the repurchase right would result in an additional
payment of $13.3 million on the $96.7 million outstanding 2024
Debentures. Holders also have the option, subject to certain
conditions, to require the company to repurchase any 2024
Debentures held by such holder in the event of a fundamental
change, at a price equal to 100% of the principal amount of the
2024 Debentures plus accrued and unpaid interest plus, under
certain circumstances, a make-whole premium."

According to Mr. Gardner, the company is actively seeking various
alternatives to refinance the debt. "However, we can make no
assurance at this time that such financing will be completed as
contemplated or under terms acceptable to the company or its
existing shareholders. Failure to generate additional revenues,
raise additional capital or manage discretionary spending could
have a material adverse effect on the company's ability to
continue as a going concern and to achieve its intended business
objectives. Accordingly, there is substantial doubt about our
ability to continue as a going concern."

In a press release, Vitesse Semiconductor said it achieved
profitability for the fiscal year ended September 30, 2008 with
net income of $16.6 million.

On December 30, the company filed an annual report on Form 10-K
with the Securities and Exchange Commission to report the
company's fiscal year 2008 results of operations and financial
condition. Vitesse also filed quarterly reports on Forms 10-Q for
the periods ended:

   * December 31, 2007 -- http://researcharchives.com/t/s?374d

   * March 31, 2008 -- http://researcharchives.com/t/s?374e

   * June 30, 2008 -- http://researcharchives.com/t/s?374f

Vitesse said with the filings, the company is once again current
with respect to its Exchange Act reporting obligations.

"Vitesse has emerged from some very formidable times as a stronger
and profitable business. We have taken concrete steps to improve
our strategic direction, product execution, operational
efficiency, and customer loyalty," said Mr. Gardner in a press
release. "The results are a dramatic three-year trend of improved
operational and financial performance. During this time, we have
strengthened substantially every financial metric including:
revenue, margins, operating income, net income, net debt, and
cash. While we still have some challenges ahead, we now have a
sound base on which to build, and we remain as committed as ever
to improving shareholder value."

                Recap of Fiscal Year 2008 Results

Vitesse's fiscal year 2008 highlights:

   * Net revenues in fiscal year 2008 were $228.5 million, an
     increase of 3% compared with the $221.9 million reported for
     fiscal year 2007;

   * Revenue for the licensing of intellectual property was
     $10.0 million in fiscal year 2008;

   * Cost of revenues for fiscal year 2008 was $106.3 million, or
     47% of revenues, a decrease from $113.8 million, or 51% of
     revenues for fiscal year ended 2007;

   * Income from operations in fiscal year 2008 was $8.4 million
     compared to a loss from operations of $1.8 million for fiscal
     year 2007. Income from operations in fiscal year 2008
     includes charges of $10.8 million related to professional
     fees associated with the completion of its internal
     accounting investigation, actions to improve internal
     controls and preparation of its financial statements. The
     fiscal year 2007 loss from operations included the same
     professional charges totaling $13.6 million;

   * Net income for fiscal year 2008 was $16.6 million, compared
     to net loss of $21.6 million for fiscal year 2007; and

   * Cash position as of September 30, 2008 was $36.7 million.

As of September 30, the company's balance sheet showed total
assets of $292,277,000, total liabilities of $166,751,000,
minority interest of $165,000, and total shareholders' equity of
$125,361,000.

A full-text copy of the company's annual report is available for
free at: http://researcharchives.com/t/s?374c

                          About Vitesse

Vitesse Semiconductor Corporation -- http://www.vitesse.com/--
designs, develops and markets a diverse portfolio of high-
performance, cost-competitive semiconductor solutions for Carrier
and Enterprise networks worldwide. Engineering excellence and
dedicated customer service distinguish Vitesse as an industry
leader in Gigabit Ethernet LAN, Ethernet-over-SONET, Fibre
Channel, Optical Transport, and other applications. Vitesse
innovation empowers customers to deliver superior products for
Enterprise, Access, Metro, and Core applications.


WEST HAWK: $10.6MM Trade Debt Agreement Terminated
--------------------------------------------------
Scandinavian Oil-Gas Magazine reports that West Hawk Development
Corp. said that the agreement for the assignment and transfer of
$10.6 million in outstanding trade debt of West Hawk Energy (USA)
LLC has been terminated.

Scandinavian Oil-Gas Magazine relates that the termination of the
agreement has caused the remaining $10.3 million unpaid debt to
revert to West Hawk Energy.  The report says that under the
agreement, the promissory notes in the approximate principal
amounts of $9.8 million and $1.3 million have been canceled.

According to Scandinavian Oil-Gas Magazine, West Hawk Energy is
preparing a workout plan to present to its creditors.

West Hawk Energy (USA) LLC -- http://www.westhawkdevelopment.com/
-- provides energy products from a variety of sources.  Assets
under development include the figure four natural gas property
located in the Piceance Basin, Colorado, being developed under a
drilling and development agreement; and the Groundhog coal
property located in northwest British Columbia.

West Hawk Energy is a subsidiary of Englewood, Canada-based West
Hawk Development Corp.

As reported by the Troubled Company Reporter on Dec. 26, 2008,
West Hawk Energy sought Chapter 11 protection in the U.S.
Bankruptcy Court for the District of Colorado in order to
implement the restructuring of its indebtedness and permanently
improve its capital structure.


WILSON MANUFACTURING: Files for Chapter 11 in Oklahoma
------------------------------------------------------
Marie Price at The Journal Record reports that Wilson
Manufacturing Inc. has filed for Chapter 11 bankruptcy protection
in the U.S. Bankruptcy Court for the Western District of Oklahoma.

According to The Journal Record, Wilson Manufacturing listed about
$3.7 million in assets and $4.5 million in liabilities.  The
Journal Record reports that Wilson Manufacturing listed
$2.8 million in personal property and $922,000 in real property as
among its assets.  Court documents say that Wilson Manufacturing
has between 50 and 99 creditors.  Wilson Manufacturing, says the
report, listed these liabilities:

     -- $2.1 million in secured claims,
     -- $1.1 million in unsecured priority claims, and
     -- $1.23 million in unsecured, non-priority claims.

The Journal Record relates that Wilson Manufacturing's largest
creditor claims include:

     -- $1.75 million for its shop and office building,

     -- $582,267 in federal withholding taxes owed to the
        Internal Revenue Service,

     -- $374,000 in state withholding taxes owed to the Oklahoma
        Tax Commission,

     -- $126,250 in Oklahoma unemployment taxes, and

     -- $147,171 on an open account with Central Nebraska Tubing.

Wilson Manufacturing listed as "disputed" a $173,000 open account
with an oil-field pipe and supply firm, and a $140,000 loan from a
Cherokee resident, The Journal Record says.

Oklahoma-based Wilson Manufacturing Inc. makes livestock-handling
equipment, including portable wheeled corrals.


XIOM CORP: Auditor's Opinion Delays Filing of Quarterly Report
--------------------------------------------------------------
Xiom Corp. disclosed in a filing with the Securities and Exchange
Commission that it cannot file the financial results for year end
Sept. 30, 2008, by the prescribed due date.

The company stated that the Independent Auditor needs more time to
complete the required field-work necessary to issue an opinion on
the fiscal year end Sept. 30, 2008.

In a separate filing, Xiom said it has restated its financial
statements for March 31, 2008, and June 30, 2008, in order to
correct errors related to the accounting treatment for a
subsidiary and for the February 2007 acquisition of a certain
thermal spray technology from the company's chief executive
officer in exchange for 75,000 shares of the company's common
stock.

The company also disclosed that it has restated its financial
statements at Dec. 31, 2007, and for the three months then ended
in order to correct errors related to the accounting for the
issuance of stock option grants, for a consulting agreement
finalized after Dec. 31, 2007, where services related to this
agreement commenced in October 2007, for shares issued in
January 2008 for equipment and related services payable at
December 31, 2007, for the February 2007 acquisition of a certain
thermal spray technology from the company's chief executive
officer in exchange for 75,000 shares of the company's common
stock and for other miscellaneous adjustments to Accounts
Receivable and Inventory.

Headquartered in West Babylon, New York, Xiom Corp. (OTC BB: XMCP)
-- http://xiom-corp.com/-- manufactures industrial based thermal
spray coating systems in the United States.  It offers XIOM 1000
Thermal Spray system, which is used to apply plastic powder
coatings on steel, aluminum, and non-ferrous substrates, as well
as on wood, plastic, masonry, and fiberglass.  The company also
offers plastic powders designed specifically for thermal spraying.
XIOM Corp. sells its spray systems directly to commercial
customers and coating contractors.  The company has introduced a
new high production rate spray gun, the XIOM 5000, which sprays up
to five times as fast as the current Xiom 1000 gun and has many
benefits over the present technology.

XIOM Corp.'s consolidated balance sheet at June 30, 2008, showed
$2,529,769 in total assets, $2,287,352 in total liabilities, and
$670,399 in common stock, subject to recession rights, resulting
in a $427,982 stockholders' deficit.

                       Going Concern Doubt

As of June 30, 2008, the company has a total stockholders' deficit
of approximately $428,000 and incurred a net loss of approximately
$1,944,000 for the nine months ended June 30, 2008.  These factors
raise substantial doubt about the company's ability to continue as
a going concern.


* Duane Morris Snags Dewey & LeBoeuf's Schrag and Heuer
-------------------------------------------------------
Duane Morris LLP has added William H. Schrag as a partner in its
Business Reorganization and Financial Restructuring Practice Group
in the firm's New York office. He was formerly a partner at Dewey
& LeBoeuf LLP.  William C. Heuer, also formerly of Dewey &
LeBoeuf, will join Mr. Schrag in New York as special counsel for
the group.

Messrs. Mr. Schrag and Mr. Heuer join the firm shortly after the
addition of a 20-lawyer New York-based construction and real
estate practice from Thelen LLP.  These additions have boosted the
number of attorneys in the New York office of Duane Morris to 100
lawyers.

With more than 25 years of experience, Mr. Schrag focuses his
practice on domestic and international insolvency litigation,
workouts, corporate reorganization and bankruptcy matters.  He has
extensive experience representing major financial institutions,
such as bank lenders and agents, as well as manufacturers and
institutional creditors, official creditors' committees, Chapter
11 trustees, purchasers of estate assets and court-appointed
examiners in U.S. and cross-border bankruptcy proceedings. He has
handled litigation arising from bankruptcy matters, and has served
as counsel to commercial lenders in creditors' rights enforcement
and the defense of lender liability claims.

Mr. Schrag has represented major clients in several high-profile
bankruptcy proceedings over the past 25 years. He served as
counsel to JPMorgan Chase Bank and its predecessors in connection
with the bankruptcy proceedings of, among others, Refco Inc., Dura
Automotive Systems Inc., Rockefeller Center Properties, Barney's
Inc., Atlanta Shipping Corp., and Axona Int'l Credit & Commerce
Ltd. He has also represented other money center banks and various
nationally-known manufacturers, such as Alcon Laboratories, Tyco
Fire & Security and Bombardier Inc.

Mr. Schrag previously served as a partner at Morgan Lewis and as
an assistant corporation counsel in the Commercial Litigation
Division of the New York City Law Department. He is active in the
American Bankruptcy Institute, the International Insolvency
Institute, the Association of Insolvency and Restructuring
Advisors, the GLOBAL INSOLvency.com Advisory Board and the
Steering Committee of the Annual Zaretsky Roundtable on Bankruptcy
Law. He frequently writes and speaks on cross-border insolvencies
and other bankruptcy-related issues.

Mr. Schrag earned his J.D. from Brooklyn Law School in 1978, where
he received the Brooklyn Law School and American Jurisprudence
Awards for Administrative Law. He graduated in 1975 with a B.A. in
Political Science from George Washington University, where he was
a member of Phi Beta Kappa. He is admitted to practice in New
York.

Mr. Heuer focuses his practice in the areas of bankruptcy,
creditors' rights, financial restructuring and related litigation.
He has represented clients operating in such industries as
financial services, real estate, telecommunications, healthcare,
shipping, safety equipment and general consumer products
manufacturing and services. Mr. Heuer has also been involved in a
number of cases before the Supreme Court of the United States,
including Marshall v. Marshall (In re Vickie Lynn Marshall),
Travelers Casualty & Surety Co. v. PG&E, Marrama v. Citizens Bank
of Massachusetts, Howard Delivery Service v. Zurich Am. Ins. Co.
and DeRoche v. Ariz. Indus. Comm'n (In re DeRoche). Mr. Heuer was
also co-counsel to a group of 64 amici in the recent Supreme Court
case D.C. v. Heller, involving the Second Amendment, and has been
named a member of the Pro Bono Society of the Association of the
Bar of the City of New York and a member of the Empire State
Counsel of the New York Bar Association for his pro bono
contributions. He has written on numerous bankruptcy matters.

Mr. Heuer earned his J.D. in 1997 from St. John's University
School of Law, where he was a staff member and editor of the
American Bankruptcy Institute Law Review and president of the
Bankruptcy Law Society, and graduated with a B.A. in Psychology
from the State University of New York at Buffalo in 1991. He is
admitted to practice in New York and Connecticut.
About Duane Morris

Duane Morris LLP -- http://www.duanemorris.com/-- a full-service
law firm of more than 650 attorneys, offers innovative solutions
across diverse industries in the United States and internationally
to address the legal and business challenges of today's evolving
global markets.


* Large Companies with Insolvent Balance Sheets
-----------------------------------------------
                                              Total
                                             Share-      Total
                                   Total     holder    Working
                                  Assets     Equity    Capital
Company            Ticker          ($MM)      ($MM)      ($MM)
-------            ------         ------     ------    -------
ABSOLUTE SOFTWRE   ABT CN           107         (3)        31
APP PHARMACEUTIC   APPX US        1,105        (42)       260
ARBITRON INC       ARB US           162         (9)       (39)
BARE ESCENTUALS    BARE US          272        (25)       125
BLOUNT INTL        BLT US           485        (20)       119
CABLEVISION SYS    CVC US         9,717     (4,966)    (1,583)
CENTENNIAL COMM    CYCL US        1,394     (1,026)        86
CHENIERE ENERGY    CQP US         2,021       (312)       179
CHOICE HOTELS      CHH US           350        (91)        (8)
CLOROX CO          CLX US         4,587       (364)      (396)
CV THERAPEUTICS    CVTX US          392       (226)       286
DELTEK INC         PROJ US          188        (62)        34
DISH NETWORK-A     DISH US        7,177     (2,129)    (1,318)
DOMINO'S PIZZA     DPZ US           441     (1,437)        84
DUN & BRADSTREET   DNB US         1,642       (554)      (206)
DYAX CORP          DYAX US           91        (28)        33
ENERGY SAV INCOM   SIF-U CN         464       (263)       (92)
EXELIXIS INC       EXEL US          255        (23)        (1)
EXTENDICARE REAL   EXE-U CN       1,621        (31)       125
FERRELLGAS-LP      FGP US         1,510        (12)      (114)
GARTNER INC        IT US          1,115        (15)      (253)
GENCORP INC        GY US          1,014        (22)        66
GENERAL MOTO-CED   GM AR        110,425    (58,994)   (18,461)
GENERAL MOTORS     GM US        110,425    (58,994)   (18,461)
HEALTHSOUTH CORP   HLS US         1,980       (874)      (218)
IMAX CORP          IMAX US          238        (91)        41
IMAX CORP          IMX CN           238        (91)        41
INCYTE CORP        INCY US          265       (177)       216
INDEVUS PHARMACE   IDEV US          263       (130)        19
INTERMUNE INC      ITMN US          206        (92)       134
KNOLOGY INC        KNOL US          647        (44)        13
LINEAR TECH CORP   LLTC US        1,665       (378)     1,109
MEDIACOM COMM-A    MCCC US        3,688       (279)      (311)
MOODY'S CORP       MCO US         1,694       (894)      (331)
NATIONAL CINEMED   NCMI US          569       (476)        86
NAVISTAR INTL      NAV US        10,390     (1,495)     1,660
NPS PHARM INC      NPSP US          202       (208)        90
OCH-ZIFF CAPIT-A   OZM US         2,224       (173)         -
OSIRIS THERAPEUT   OSIR US           29         (8)       (14)
OVERSTOCK.COM      OSTK US          145         (4)        33
PALM INC           PALM US          661       (151)       (40)
REGAL ENTERTAI-A   RGC US         2,557       (224)      (112)
REVLON INC-A       REV US           877       (999)         8
ROTHMANS INC       ROC CN           545       (213)       102
SALLY BEAUTY HOL   SBH US         1,527       (697)       367
SONIC CORP         SONC US          836        (64)       (13)
STEREOTAXIS INC    STXS US           55         (5)         3
SUCCESSFACTORS I   SFSF US          168         (3)         4
SUN COMMUNITIES    SUI US         1,222        (28)         -
SYNTA PHARMACEUT   SNTA US           91        (35)        58
TAUBMAN CENTERS    TCO US         3,182        (20)         -
TEAL EXPLORATION   TEL SJ            70        (36)       (80)
THERAVANCE         THRX US          255       (125)       184
UAL CORP           UAUA US       20,731     (1,282)    (1,583)
UST INC            UST US         1,402       (326)       237
WARNER MUSIC GRO   WMG US         4,476        (86)      (623)
WEIGHT WATCHERS    WTW US         1,110       (901)      (270)
WESTERN UNION      WU US          5,504        (90)       319
WR GRACE & CO      GRA US         3,754       (179)       970



                             *********

Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par.  Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable.  Those sources may not,
however, be complete or accurate.  The Monday Bond Pricing table
is compiled on the Friday prior to publication.  Prices reported
are not intended to reflect actual trades.  Prices for actual
trades are probably different.  Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind.  It is likely that some entity
affiliated with a TCR editor holds some position in the issuers'
public debt and equity securities about which we report.

Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets.  At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled.  Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets.  A company may establish reserves on its balance sheet for
liabilities that may never materialize.  The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.

A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged.  Send announcements to
conferences@bankrupt.com/

On Thursdays, the TCR delivers a list of recently filed chapter 11
cases involving less than $1,000,000 in assets and liabilities
delivered to nation's bankruptcy courts.  The list includes links
to freely downloadable images of these small-dollar petitions in
Acrobat PDF format.

Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals.  All titles are
available at your local bookstore or through Amazon.com.  Go to
http://www.bankrupt.com/books/to order any title today.

Monthly Operating Reports are summarized in every Saturday edition
of the TCR.

For copies of court documents filed in the District of Delaware,
please contact Vito at Parcels, Inc., at 302-658-9911.  For
bankruptcy documents filed in cases pending outside the District
of Delaware, contact Ken Troubh at Nationwide Research &
Consulting at 207/791-2852.

                             *********

S U B S C R I P T I O N   I N F O R M A T I O N

Troubled Company Reporter is a daily newsletter co-published
by Bankruptcy Creditors' Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland,
USA.  Ronald C. Sy, Joel Anthony G. Lopez, Cecil R. Villacampa,
Luke Caballos, Sheryl Joy P. Olano, Carlo Fernandez, Christopher
G. Patalinghug, and Peter A. Chapman, Editors.

Copyright 2009.  All rights reserved.  ISSN: 1520-9474.

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers.  Information contained
herein is obtained from sources believed to be reliable, but is
not guaranteed.

The TCR subscription rate is $775 for 6 months delivered via e-
mail.  Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance thereof
are $25 each.  For subscription information, contact Christopher
Beard at 240/629-3300.

                    *** End of Transmission ***