/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/090302.mbx T R O U B L E D C O M P A N Y R E P O R T E R Monday, March 2, 2009, Vol. 13, No. 60 Headlines ABBOTT LABORATORIES: Moody's Puts Rating on $3.0 Bil. Sr. Notes ACTUANT CORP: S&P Changes Outlook to Negative; Keeps 'BB' Rating ALPHARMA INC: S&P Withdraws 'B+' Corporate Credit Rating AMERICAN INT'L: Gov't Eases Loan Terms, Gives Co. $30BB More AMERICAN INT'L: In Talks with China Life on Asian Unit AMERICAN REPOGRAPHICS: Moody's Reviews 'Ba3' Corp. Family Rating ATLANTIC BROADBAND: S&P Puts 'B' Rating on Positive CreditWatch AVIS BUDGET: Bank Debt Trades at 62% Discount in Secondary Market AXIUM INT'L: Trustee Sues BDO Seidman & BDO Global for Negligence BEARINGPOINT INC: Grant Thornton Eyes Firm's Consulting Units BLOCKBUSTER INC: Bank Debt Trades at 30% Off in Secondary Market BRIAN STARCHER: Files for Chapter 7 Liquidation BURLINGTON COAT: Bank Debt Continues Slide; Trades at 65% Off CABLEVISION SYSTEMS: Posts $321.4MM Net Loss in 4th Quarter 2008 CANWEST GLOBAL: Tries to Reinstate Credit Facility CANWEST MEDIA: Lenders Extends Waiver to March 11; Talks Continue CAPMARK FINANCIAL: Fitch Downgrades Issuer Default Rating to 'B-' CAPMARK FINANCIAL: Moody's Downgrades Senior Ratings to 'Ba2' CEQUEL COMMUNICATIONS: Moody's Puts Pos. Outlook; Keeps B2 Rating CHARYS HOLDING: Wins Confirmation of Chapter 11 Plan CITY OF LA VERNE: S&P Affirms 'BB' Rating; Outlook Negative CITIGROUP INC: Gov't Grants Another Bailout in Exchange for Stake CITIGROUP INC: Treasury to Participate in Exchange Offering CONSECO INC: S&P Junks Local Currency Counterparty Credit Rating DANA CORP: Bank Loan Continues Slide; Trades at Near 70% Discount DELPHI CORP: GM Not Sure on Former Unit's Ability to Get Exit Loan DELPHI CORP: Gets SEC Nod to Seal Some Terms of GM MRA Until 2015 DOLLAR THRIFTY: S&P Retains Negative CreditWatch on 'CCC+' Rating DOUBLEDOWN MEDIA: Wall Street Magazine Files to Liquidate DREIER LLP: Bar Date for Pre-Bankruptcy Claims Set for March 31 DRYSHIPS INC: Pens Final Pact With Nordea for Covenant Waiver DYNOGEN PHARMACEUTICALS: Sends Business to Chapter 7 Liquidation ECLIPSE AVIATION: Suspends Operations, Lays Off Workers ELITE LANDINGS: Court Extends Plan Filing Period to June 6, 2009 EMERSON REINSURANCE: Moody's Withdraws 'Ba2' Rating on C Notes ENERGY PARTNERS: Restructuring Prompts S&P's Rating Cut to 'CCC+' ENERLUME ENERGY: Signs Promissory Note Extension With D. Troiano ESTATE FINANCIAL: Trustee Wants to Tap Farella Braun as Counsel FALCON RIDGE: Can't File Form 10-Q Report on Time FANNIE MAE: Posts $58.7 Billion Net Loss for 2008 FIRST MAGNUS: Trustee Sues Executives for Excessive Spending FRANK GRIFFIN: Files for Chapter 7; Dent's Undertaking Closes GAINEY CORP: Lester Coggins Obtains Court's Nod to Sell Tractors GAINEY CORP: Exclusive Period to File a Plan Extended to March 31 GANNETT CO: Moody's Downgrades Ratings on Senior Notes to 'Ba2' GENERAL MOTORS: Bondholders Wants Gov't Backing for New Debt GENERAL MOTORS: Not Sure on Delphi's Ability to Get Exit Financing GENERAL MOTORS: Delphi Gets SEC Nod to Redact Terms of MRA Pact GEORGIA GULF: Weak Housing Markets Cue Fitch's Junk Ratings GLOBAL NETWORK: Voluntary Chapter 11 Case Summary HAYES LEMMERZ: Fitch Junks Issuer Default Rating from 'B-' HERITAGE COMMUNITY: Illinois Regulators Appoint FDIC as Receiver HERTZ CORP: Bank Loan Sells at 30% Off in Secondary Market HILL-ROM HOLDINGS: S&P Assigns 'BB+' Initial Subordinated Rating HOME INTERIORS: Can Sell Computer Equipment to Home & Garden HOME INTERIORS: Court OKs Sale of Mexican Entities' Capital Stock HOMELAND SECURITY: Dec. 31 Balance Sheet Upside Down by $809,448 HUNTSMAN ICI: Bank Loan Sells at 30% Off in Secondary Market IMPLANT SCIENCES: Posts $2MM Net Loss in Quarter Ended Dec. 31 INCENTRA SOLUTIONS: Bid Procedures Approved, Moves to Sell Assets INDYMAC BANK: Inspector General Says OTC Failed to Act Fast INSIGHT HEALTH: Dec. 31 Balance Sheet Upside Down by $148.3 Mil. INTROGEN THERAPEUTICS: Wins Nod to Auction Off Equipment & Patents IRIDIUM SATELLITE: Moody's Upgrades Corp. Family Rating to 'Ba3' JOURNAL REGISTER: Targets July 1 Emergence from Chapter 11 JOURNAL REGISTER: Gets Interim OK to Use Lenders' Cash Collateral JOURNAL REGISTER: Organizational Meeting to Form Panel on March 3 KRONOS INTERNATIONAL: Moody's Junks Corp. Family Rating from 'B2' LAKESIDE FUNDING: Fitch Cuts Rating on Liquidity Notes to 'B' LAMAR ADVERTISING: S&P Downgrades Corporate Credit Rating to 'B+' LAND O'LAKES: Moody's Affirms Corporate Family Rating at 'Ba1' LEAR CORP: Bank Loan Continues Slide; Trades at Almost 66% Off LEHMAN BROTHERS: Wants to Let Insurers Pay for Execs. Legal Fees LEHMAN BROTHERS: Wants to Keep Foreign Accounts, Invest $6-Bil. LEVEL 3: Bank Loan Sells at 26% Off in Secondary Market LEXINGTON PRECISION: Plan Filing Period Extended to April 27 LYONDELL CHEMICAL: $8-Bil. DIP Loan Approved on Final Basis LYONDELL CHEMICAL: US Judge Gives Parent Time to File or Negotiate MAGNA ENTERTAINMENT: PNC Bank Declares Event of Default MANITOWOC CO: Bank Loan Continues Slump; Sells at 24% Discount MASONITE INT'L: Bank Loan Continues Slide; Sells at 59% Discount MEDIANEWS GROUP: Bank Loan Sells at 80% Off in Secondary Market MICHAEL VICK: To Spend Last Two Months of Imprisonment at Home MICHAELS STORES: Bank Loan Continues Slump; Sells at 44% Discount MIDWAY GAMES: Section 341(a) Meeting Set for March 26 in Delaware MINNEAPOLIS GRAND: Files for Bankruptcy Protection MUELLER WATER: Moody's Downgrades Corp. Family Rating to 'B2' NATIONAL AMUSEMENTS: To Sell Assets to Repay Debt by End of 2010 NEENAH FOUNDRY: Moody's Downgrades Corp. Family Rating to 'Caa2' NEIMAN MARCUS: Bank Loan Sells at 35% Off in Secondary Market NEPTUNE INDUSTRIES: Can't File Form 10-Q Report on Time NEVADA OPERA: Raises $100,000 to Avert Closure NOBLE INTERNATIONAL: Receives 30-Day Accommodations from Big 3 NOVELIS INC: Bank Loan Trades at 40% Discount in Secondary Market OFFICE DEPOT: S&P Downgrades Corporate Credit Rating to 'B' OSI RESTAURANT: Bank Loan Sells at 52% Off in Secondary Market OFFICE DEPOT: Moody's Downgrades Corp. Family Rating to 'B1' OPTI CANADA: Moody's Downgrades Corporate Family Rating to 'B3' PENTON BUSINESS: Weak Market Conditions Cue Moody's Junk Rating PETTERS GROUP: Court Okays Doug Kelley as Trustee PHH CORPORATION: Fitch Downgrades Issuer Default Rating to 'BB+' PHILADELPHIA NEWSPAPERS: Meeting to Form Creditors Panel Today PHILADELPHIA NEWSPAPERS: Taps Garden City Group as Claims Agent PHILADELPHIA NEWSPAPERS: Taps Proskauer Rose as Bankruptcy Counsel PHOENIX COS: S&P Puts BB+ Counterparty Credit Rating on WatchNeg. PILGRIM'S PRIDE: To Idle Three Chicken Processing Plants PRECISION PARTS: Gets Short Delay to Auction Process PRIMUS FINANCIAL: S&P Affirms 'BB+' Rating on Preferred Stock QIMONDA RICHMOND: Organizational Meeting to Form Panel on March 5 QIMONDA RICHMOND: Wants to Hire Epiq as Claims and Noticing Agent QUEBECOR WORLD: Hiring Credit Suisse to Syndicate $750MM Loan R.A.E.D. INVESTMENTS: Has $220K Offer for Pittsburgh Property REALOGY CORP: $150MM Investment Won't Affect Moody's Rating RITZ CAMERA: Organizational Meeting to Form Panel on March 3 ROCK-TENN COMPANY: Moody's Raises Ratings on Sr. Notes to 'Ba1' RYLAND GROUP: R. Chad Dreier to Leave CEO Post, Remains in Board RYNESS COMPANY: Case Summary & 28 Largest Unsecured Creditors SAN JOSE AIRPORT HOTEL: Files for Chapter 11 Bankruptcy Protection SECURITY BENEFIT: S&P Cuts Counterparty Credit Rating to 'BB' SECURITY SAVINGS: Nevada Regulators Appoint FDIC as Receiver SEMGROUP LP: Catsimatidis Has No Funds for Asphalt Bid; No Buyer SERVICE MASTER: Bank Loan Sells at 36% Off in Secondary Market SIMMONS BEDDING: Moody's Puts 'Ca' Probability of Default Rating SINGLE TOUCH: December 31 Balance Sheet Upside-Down by $5 Million SIRIUS XM RADIO: Discloses Exchange of $172.5MM of Existing Notes SMART-TEK SOLUTIONS: Dec. 31 Balance Sheet Upside Down $729,468 SPANSION INC: Files for Chapter 11; Aims to Emerge Quickly SPANSION INC: Case Summary & 65 Largest Unsecured Creditors STANDARD STEEL: Moody's Downgrades Corporate Family Rating to B3 STANFORD INT'L BANK: Hearing on US$8 Bln Fraud Case Set Today TENNECO INC: Fitch Downgrades Issuer Default Rating to 'B' TEREX CORP: S&P Affirms Corporate Credit Ratings at 'BB' TOYS R US: Bank Loan Sells at Near 75% Discount TRIBUNE CO: Halts Efforts to Sell Chicago Tower/La Times Bldg. TRIBUNE CO: Bank Loan Sells at 75% Off in Secondary Market TROPICANA OPCO: Bank Loan Sells at 77% Off in Secondary Market TRUMP ENTERTAINMENT: Seeks to Hire McCarter & English as Counsel TRUMP ENTERTAINMENT: Seeks to Hire Garden City as Claims Agent TRUMP ENTERTAINMENT: Seeks To Tap Weil Gotshal as Co-Counsel TRW AUTOMOTIVE: Bank Debt Continues Slump; Sells at 43% Discount TRUMP ENTERTAINMENT: Gets Initial Approval to Use Cash Collateral TRW AUTOMOTIVE: Fitch Downgrades Issuer Default Rating to 'B+' UPTOWN PARTNERS: Files for Chapter 11 in Manhattan VALASSIS CORP: Bank Debt Sells at 30% Discount VCSP LLC: Voluntary Chapter 11 Case Summary VIDEOTRON LTEE: Moody's Assigns 'Ba2' Rating on $200 Mil. Notes VIDEOTRON LTEE: S&P Puts BB- Rating on Proposed $260MM Notes VISTEON CORP: Bank Debt Continues Major Slide; Sells at 82% Off WHEELING-PITTSBURGH: Asks Court to Formally Close Chap. 11 Cases WILLIAMS COS: S&P Assigns 'BB+' Rating on $600 Mil. Senior Notes WL HOMES: Organizational Meeting to Form Panel on March 3 WYNN RESORTS: S&P Affirms Corporate Credit Rating at 'BB' XIOM CORP: Dec. 31 Balance Sheet Upside Down by $456,001 * Auto Industry Bank Debt Continues Slump; TRW Down by 7 Points * Failed Banks Tally This Year Already Exceeds 2008's * Retailer Bank Debt Slumps in Secondary Market Trading * To Save Retailers, BAPCPA's Timetable for Leases Gets 2nd Look * Fourth Circuit Permits Bifurcating Mobile Home Debt * BOND PRICING: For the Week From February 23 - 27, 2009 ********* ABBOTT LABORATORIES: Moody's Puts Rating on $3.0 Bil. Sr. Notes --------------------------------------------------------------- Moody's Investors Service assigned an A1 rating to Abbott Laboratories' new $3.0 billion senior note offering and a (P)A1 to the company's new WKSI senior shelf. Proceeds from this note offering will be used to refinance commercial paper borrowings used to fund the closing of the Advanced Medical Optics transaction. At the same time, Moody's affirmed Abbott's existing ratings and withdrew the company's existing shelf rating. The rating outlook is stable. Moody's also withdrew all of AMO's ratings following the completion of the tender offer for AMO. Moody's expect AMO's senior secured bank debt to be repaid at closing and substantially all of its senior subordinated notes to be tendered. Because AMO's convertible subordinated notes have a put right triggered by this transaction, it is possible that these converts may remain outstanding. However, given the lack of a parent guarantee and Moody's understanding that Abbott will not provide ongoing financial statements for its AMO subsidiary, Moody's will be unable to effectively assess the creditworthiness of the subsidiary. In addition to funding the acquisition of AMO, Abbott's substantial cash needs during the first half of 2009 include two $500 million debt maturities, one of which was paid in February, as well as outflows related to pensions, dividends, share buybacks and the completion of the IBIS transaction. "In light of relatively high short-term borrowing needs, this debt offering helps Abbott maintain a sufficient liquidity profile," Diana Lee, a Senior Credit Officer at Moody's commented. Earlier this year, Moody's affirmed Abbott's ratings in conjunction with the announced acquisition of AMO. Although AMO does reduce Abbott's financial flexibility, stronger than expected cash flow generation during fiscal 2008 provides a key offset to higher leverage. Further, while eye care products are more vulnerable to a weak economy as highlighted by AMO's lackluster organic growth rates, this acquisition should help further diversify Abbott's portfolio. Abbott's A1 ratings reflect its already broad spectrum of healthcare products as well as relatively low exposure to patent expirations. In addition to pharmaceuticals, Abbott benefits from steady sales in both its diagnostic and nutritional businesses and has a growing presence in medical products. The stable outlook assumes that Abbott will maintain adequate liquidity and will achieve stronger credit metrics following the AMO transaction. If liquidity is impaired or ratios do not improve because the company continues to pursue acquisitions or aggressively buys back shares, the ratings could come under pressure. Ratings assigned: Abbott Laboratories: -- A1 $3.0 billion senior unsecured notes -- (P)A1 senior unsecured shelf Ratings affirmed: Abbott Laboratories: -- A1 senior unsecured notes -- P-1 short-term rating Abbott Japan Co., Ltd.: -- A1 backed senior unsecured notes Ratings withdrawn: Abbott Laboratories: -- (P)A1 existing senior unsecured shelf Advanced Medical Optics, Inc.: -- B2 Corporate Family Rating -- B2 Probability of Default Rating -- Ba2 (LGD2/14%) $300 million senior secured revolver due 2013 -- Ba2 (LGD2/14%) $445 million senior secured term loan due 2014 -- B2 (LGD3/46%) $250 million senior subordinated notes due 2017 -- Caa1 (LGD5/80%) $246 million convertible senior subordinated notes due 2024 The last rating action on Abbott was an affirmation of its ratings on January 12, 2009. The last rating action on AMO also occurred on January 12, 2009 when the direction of the company's rating review was changed to possible upgrade from possible downgrade. Abbott Laboratories, headquartered in Abbott Park, Illinois is a global, diversified healthcare company focused on pharmaceuticals and medical products, including nutritionals, devices and diagnostics. For the twelve months ended December 31, 2008, Abbott generated about $28.8 billion in revenues. ACTUANT CORP: S&P Changes Outlook to Negative; Keeps 'BB' Rating ---------------------------------------------------------------- Standard & Poor's Ratings Services revised its outlook on diversified industrial manufacturer Actuant Corp. to negative from stable. At the same time, S&P affirmed its ratings on the company, including the 'BB' corporate credit rating. "The outlook revision reflects our expectation that, amid lower demand in key markets and deteriorating operating performance, Actuant's credit measures could weaken in the coming quarters, leading to potentially limited headroom over financial covenants in the first half of fiscal 2010," said Standard & Poor's credit analyst Gregoire Buet. Although S&P expects the company to apply free cash flow principally toward debt reduction this year, mitigating the impact of lower earnings, its financial leverage could gradually increase toward the maximum ratio that Actuant is required to maintain under its bank credit agreement. If that occurs, liquidity could become constrained. The ratings on Milwaukee, Wis.-based Actuant Corp. continue to reflect the company's aggressive financial risk profile, characterized by somewhat high leverage and an acquisitive growth strategy. The company's leading position in niche markets, its diversity, and its consistent cash flow support the rating. Actuant is a diversified manufacturer of branded standard and customized products for various niche energy, industrial, automotive and truck, and retail end markets. Its portfolio includes highly engineered and specialized products such as high- force hydraulic industrial tools and joint integrity products, as well as truck actuation systems that earn attractive margins. Somewhat lower-margin products include automotive convertible top and recreational vehicle actuation systems and certain electrical tools. Products holding No. 1 positions in these niche markets generate nearly 80% of the company's sales. In addition, Actuant's relatively good geographic, customer, product, and end- market diversity has historically lessened the volatility of its earnings and cash flow. Although Actuant's free cash flow should allow for meaningful debt reduction this year, credit measures will likely weaken toward the low end of S&P's expectation for the rating in the coming quarters. S&P could consider a rating downgrade if weakening ratios leads to increasingly limited headroom over financial covenants and constrains liquidity. This could happen if, for instance, fiscal 2009 free cash flow appears likely to be meaningfully less than $100 million. Conversely, if Actuant manages to maintain or restore adequate headroom over financial covenants in a sustained manner, S&P could revise the outlook back to stable. Actuant's business profile could support a modestly higher rating, but current business conditions and the company's acquisitive financial policy limits upside potential. ALPHARMA INC: S&P Withdraws 'B+' Corporate Credit Rating -------------------------------------------------------- Standard & Poor's Ratings Services said that it has withdrawn its 'B+' corporate credit rating on Alpharma Inc. S&P also withdrew its 'B+' issue-level rating and '4' recovery rating on the company's $300 million senior unsecured convertible notes due 2027. S&P withdrew the ratings following the acquisition of the company by King Pharmaceuticals Inc. and the subsequent redemption of the convertible notes. Ratings List Alpharma Inc. Ratings Withdrawn To From ------- --------- -- ---- Corporate credit rating NR B+/Stable/-- Senior unsecured notes NR B+ (Recovery: 4) AMERICAN INT'L: Gov't Eases Loan Terms, Gives Co. $30BB More ------------------------------------------------------------ Liam Pleven, Matthew Karnitschnig, and Deborah Solomon at The Wall Street Journal report that the U.S. government will ease loan terms for the American International Group bailout by wiping out interest and give the Company access to up to $30 billion in new cash from its Troubled Asset Relief Program, or TARP. According to WSJ, the government is hoping to preserve AIG's value over a longer period. The new deal, says WSJ, represents an almost complete reversal from the one first laid out in September 2008, when government officials acted as a demanding lender, forcing AIG to pay a steep interest rate for what was expected to be a short-term loan. WSJ relates that the new plan raises the possibility that AIG will be broken up completely, with businesses being hive off in separate stock offerings, a process that would take years. AIG, says WSJ, will combine its giant property-casualty insurance operations into a new unit, with a new name and separate management, and will sell almost 20% of it to the public. The new plan will also cut AIG's $60 billion credit line with the Federal Reserve to up to $25 billion, WSJ notes. AIG, according to WSJ, will have the benefit of up to $70 billion -- 10% of the $700 billion financial-sector rescue fund -- from the TARP program. WSJ relates that AIG got a $40 billion TARP investment in November 2008. The report says that government officials believed they had little choice but to use the TARP money, particularly because they lack the authority to unwind AIG the way the government can do now with failing banks. WSJ relates that the new deal cuts the interest and dividend payments that AIG must make to the government, easing the financial burden on the Company. WSJ states that the deal will put the government more directly into the insurance business. According to the report, the plan involves creating trusts to hold these two AIG units that sell life insurance overseas: Asia-based American International Assurance Co., and American Life Insurance Co, which operates in 50 countries. The report says that the government will have preferred shares in each trust, which would pay a 5% dividend. The report states that the stakes will be used to repay the $38 billion AIG already borrowed from the government. According to WSJ, people familiar with the matter said that major credit-rating companies signed off on the latest package. WSJ relates that the government decided not to require any additional management shake-up as a condition of the bailout's revision. AIG is expected to report a $60 billion quarterly loss on Monday, says WSJ. About American International Based in New York, American International Group, Inc. (AIG) is the leading international insurance organization with operation in more than 130 countries and jurisdictions. AIG companies serve commercial, institutional and individual customers through the most extensive worldwide property-casualty and life insurance networks of any insurer. In addition, AIG companies are leading providers of retirement services, financial services and asset management around the world. AIG's common stock is listed on the New York Stock Exchange, as well as the stock exchanges in Ireland and Tokyo. During the third quarter of 2008, requirements to post collateral in connection with AIG Financial Products Corp.'s credit default swap portfolio and other AIGFP transactions and to fund returns of securities lending collateral placed stress on AIG's liquidity. AIG's stock price declined from $22.76 on Sept. 8, 2008, to $4.76 on Sept. 15, 2008. On that date, AIG's long-term debt ratings were downgraded by Standard & Poor's, a division of The McGraw- Hill Companies, Inc., Moody's Investors Service and Fitch Ratings, which triggered additional requirements for liquidity. These and other events severely limited AIG's access to debt and equity markets. On Sept. 22, 2008, AIG entered into an $85 billion revolving credit agreement with the Federal Reserve Bank of New York and, pursuant to the Fed Credit Agreement, AIG agreed to issue 100,000 shares of Series C Perpetual, Convertible, Participating Preferred Stock to a trust for the benefit of the United States Treasury. At Sept. 30, 2008, amounts owed under the facility created pursuant to the Fed Credit Agreement totaled $63 billion, including accrued fees and interest. Since Sept. 30, AIG has borrowed additional amounts under the Fed Facility and has announced plans to sell assets and businesses to repay amounts owed in connection with the Fed Credit Agreement. In addition, subsequent to Sept. 30, 2008, certain of AIG's domestic life insurance subsidiaries entered into an agreement with the NY Fed pursuant to which the NY Fed has borrowed, in return for cash collateral, investment grade fixed maturity securities from the insurance subsidiaries. On Nov. 10, 2008, the U.S. Treasury agreed to purchase, through its Troubled Asset Relief Program, $40 billion of newly issued AIG perpetual preferred shares and warrants to purchase a number of shares of common stock of AIG equal to 2% of the issued and outstanding shares as of the purchase date. All of the proceeds will be used to pay down a portion of the Federal Reserve Bank of New York credit facility. The perpetual preferred shares will carry a 10% coupon with cumulative dividends. AIG and the Fed also agreed to revise the existing FRBNY credit facility. The loan terms were extended from two to five years to give AIG time to complete its planned asset sales in an orderly manner. The equity interest that taxpayers will hold in AIG, coupled with the warrants, will total 79.9%. At Sept. 30, 2008, AIG had $1.022 trillion in total consolidated assets and $950.9 billion in total debts. Shareholders' equity was $71.18 billion, including the addition of $23 billion of consideration received for preferred stock not yet issued. AMERICAN INT'L: In Talks with China Life on Asian Unit ------------------------------------------------------ American International Group Inc. and China Life Insurance Co. are in talks over the sale of AIG's Asian unit, Bloomberg News reports citing the country's insurance regulator. According to the report, China Insurance Regulatory Commission Vice Chairman Li Kemu said AIG visited China looking for interest to buy its Asian subsidiary, American International Assurance Co. (AIA). Vice Chairman Kemu said, as cited by the report, China Life is in talks over a possible bid for the company. "This is still under discussion," Bloomberg News cited Mr. Kemu in a briefing in Beijing. "We feel AIA is a very good company. At least, its China and Hong Kong operations are not bad." About China Life China Life Insurance Company Limited (China Life) is an insurance company in the People's Republic of China. The Company's main businesses include individual life insurance, group life insurance and short term insurance. Its products and services include individual life insurance, group life insurance, accident and health insurance. The Company is a provider of annuity products and life insurance for both individuals and groups, and a provider of accident and health insurance in China. As of December 31, 2007, the Company had over 93 million individual and group life insurance policies and annuities, and long-term health insurance policies in force. It also provides both individual and group accident and short-term health insurance policies, as well as services. The Company's main business segments are Individual life insurance business; Group life insurance business; Accident and health insurance business, and Corporate and other. About AIG Based in New York, American International Group, Inc. (AIG) is the leading international insurance organization with operation in more than 130 countries and jurisdictions. AIG companies serve commercial, institutional and individual customers through the most extensive worldwide property-casualty and life insurance networks of any insurer. In addition, AIG companies are leading providers of retirement services, financial services and asset management around the world. AIG's common stock is listed on the New York Stock Exchange, as well as the stock exchanges in Ireland and Tokyo. During the third quarter of 2008, requirements to post collateral in connection with AIG Financial Products Corp.'s credit default swap portfolio and other AIGFP transactions and to fund returns of securities lending collateral placed stress on AIG's liquidity. AIG's stock price declined from US$22.76 on Sept. 8, 2008, to US$4.76 on Sept. 15, 2008. On that date, AIG's long-term debt ratings were downgraded by Standard & Poor's, a division of The McGraw-Hill Companies, Inc., Moody's Investors Service and Fitch Ratings, which triggered additional requirements for liquidity. These and other events severely limited AIG's access to debt and equity markets. On Sept. 22, 2008, AIG entered into an US$85 billion revolving credit agreement with the Federal Reserve Bank of New York and, pursuant to the Fed Credit Agreement, AIG agreed to issue 100,000 shares of Series C Perpetual, Convertible, Participating Preferred Stock to a trust for the benefit of the United States Treasury. At Sept. 30, 2008, amounts owed under the facility created pursuant to the Fed Credit Agreement totaled US$63 billion, including accrued fees and interest. Since Sept. 30, AIG has borrowed additional amounts under the Fed Facility and has announced plans to sell assets and businesses to repay amounts owed in connection with the Fed Credit Agreement. In addition, subsequent to Sept. 30, 2008, certain of AIG's domestic life insurance subsidiaries entered into an agreement with the NY Fed pursuant to which the NY Fed has borrowed, in return for cash collateral, investment grade fixed maturity securities from the insurance subsidiaries. On Nov. 10, 2008, the U.S. Treasury agreed to purchase, through its Troubled Asset Relief Program, US$40 billion of newly issued AIG perpetual preferred shares and warrants to purchase a number of shares of common stock of AIG equal to 2% of the issued and outstanding shares as of the purchase date. All of the proceeds will be used to pay down a portion of the Federal Reserve Bank of New York credit facility. The perpetual preferred shares will carry a 10% coupon with cumulative dividends. AIG and the Fed also agreed to revise the existing FRBNY credit facility. The loan terms were extended from two to five years to give AIG time to complete its planned asset sales in an orderly manner. The equity interest that taxpayers will hold in AIG, coupled with the warrants, will total 79.9%. At Sept. 30, 2008, AIG had US$1.022 trillion in total consolidated assets and US$950.9 billion in total debts. Shareholders' equity was US$71.18 billion, including the addition of US$23 billion of consideration received for preferred stock not yet issued. AMERICAN REPOGRAPHICS: Moody's Reviews 'Ba3' Corp. Family Rating ---------------------------------------------------------------- Moody's Investors Service placed the ratings of American Reprographics Company, L.L.C., including its Ba3 corporate family rating, under review for possible downgrade. This action was prompted by Moody's concern over the prospects for a significant contraction in the company's sales for 2009 given a sharp decline in construction activity within its key markets. Moody's is also concerned that potentially declining sales and profitability could result in credit metrics that are outside of the threshold accommodated by the current rating. These ratings were placed under review for downgrade: -- Corporate family rating at Ba3; -- Probability-of-default rating at B1; -- $75 million senior secured revolving credit facility due 2012 at Ba2; -- $265 million senior secured term loan due 2012 at Ba2. The review will focus on ARC's business outlook and cost reduction initiatives as well as its fundamentals and liquidity profile, including cushion under the financial covenants governing its credit facilities. The last rating action was on November 14, 2007 when Moody's affirmed ARC's Ba3 corporate family rating, but revised its ratings outlook to stable from positive. Headquartered in Walnut Creek, California, American Reprographics Company, L.L.C., is a leading reprographics service company in the U.S. ATLANTIC BROADBAND: S&P Puts 'B' Rating on Positive CreditWatch --------------------------------------------------------------- Standard & Poor's Ratings Services said it placed its ratings on Quincy, Massachusetts-based cable TV provider Atlantic Broadband Finance LLC, including the 'B' corporate credit rating, on CreditWatch with positive implications. This action affects about $669 million of rated debt. "This action follows Atlantic Broadband's improving operating and financial performance over the past few years," said Standard & Poor's credit analyst Naveen Sarma. Over this period, the company has moderated annualized subscriber losses to around 1% from about 4% in 2005, reported continued double-digit high-speed data subscriber growth, and successfully launched telephone services across the majority of its markets. "As a result," added Mr. Sarma, "free cash flow has grown while leverage, including the preferred units at the parent Atlantic Broadband Group LLC, has declined to around 6x as of the third quarter of 2008, from over 8.5x." AVIS BUDGET: Bank Debt Trades at 62% Discount in Secondary Market ----------------------------------------------------------------- Participations in a syndicated loan under which Avis Budget Car Rental LLC is a borrower traded in the secondary market at 37.80 cents-on-the-dollar during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. This represents a drop of 3.92 percentage points from the previous week, the Journal relates. The loan matures April 1, 2012. Avis Budget pays 125 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's Ba3 rating and Standard & Poor's B rating. Meanwhile, participations in a syndicated loan under which Hertz Corporation is a borrower traded in the secondary market at 65.85 cents-on-the-dollar during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. This represents a decrease of 2.37 percentage points from the previous week, the Journal relates. The loan matures on December 21, 2012. Hertz pays 150 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's Ba1 rating and Standard & Poor's BB+ rating. Syndicated loans of auto parts makers also slid in secondary market trading during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. Investors avoided TRW Automotive and Visteon Corp. bank debt. Participations in a syndicated loan under which TRW Automotive is a borrower traded in the secondary market at 57.20 cents-on-the- dollar, a drop of 7.13 percentage points -- at 64.33 cents-on-the- dollar -- from the previous week. TRW Automotive pays 150 basis points to borrow under the facility. The bank loan carries Moody's Ba1 rating and Standard & Poor's BBB- rating. Visteon Corp. bank debt continued its slide, trading in the secondary market at 17.71 cents-on-the-dollar during the week ended February 27, 2009. This represents a drop of 2.50 percentage points -- at 20.21 cents-on-the-dollar -- from the previous week. The loan matures May 30, 2013. Visteon pays 300 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B3 rating and Standard & Poor's B- rating. Dana Corporation bank debt traded at 30.43 cents-on-the-dollar, a drop of 2.97 percentage points -- at 33.40 cents-on-the-dollar -- from the previous week. The loan matures January 31, 2015. Dana pays 375 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B3 rating and Standard & Poor's B+ rating. Lear Corp. bank debt traded at 34.57 cents-on-the-dollar, a drop of 3.99 percentage points -- at 38.56 cents-on-the-dollar -- from the previous week. The loan matures March 29, 2012. Lear pays 250 basis points above LIBOR to borrow under the facility. The bank loan is not rated. Based in Parsippany, New Jersey, Avis Budget Group, Inc., provides car and truck rentals and ancillary services to businesses and consumers in the United States and internationally. * * * As reported by the Troubled Company Reporter on January 8, 2009, Standard & Poor's Ratings Services said its ratings on Avis Budget Group Inc. and Avis Budget Car Rental LLC, including the 'CCC+' long-term corporate credit ratings on both entities, remain on CreditWatch, but the implications have been revised to positive from developing, where they were placed on Dec. 22, 2008. On Dec. 23, 2008, car rental company Avis Budget received commitments to renew its asset-backed bank conduit facility and its ABS seasonal conduit facility, both of which it uses to finance cars for its rental fleet. The company also announced on that date that it had completed an amendment to its corporate credit facility to replace the leverage and interest coverage ratios with a minimum EBITDA covenant. The TCR said February 9 that Moody's Investors Service lowered the Corporate Family Rating and Probability of Default of Avis Budget Car Rental to B2 from Ba2. The company's Speculative Grade Liquidity Rating was also lowered to SGL-3 from SGL-2. The outlook is negative. The downgrade of Avis' long-term and speculative grade liquidity ratings reflects the significant erosion in the company's credit metrics that will result from the continuing weakness in leisure and commercial travel, and the resulting fall-off in rental car demand. During 2009 Moody's expect that Avis' performance will be burdened with lower rental demand and revenues, under-absorbed overhead costs, significantly higher interest expense on its fleet financing debt, and the need to refinance a significant portion of this fleet debt during late 2009. AXIUM INT'L: Trustee Sues BDO Seidman & BDO Global for Negligence ----------------------------------------------------------------- Howard M. Ehrenberg, partner at Los Angeles-based SulmeyerKupetz law firm and the court appointed Chapter 7 bankruptcy Trustee for Axium International, Inc., and its subsidiaries, has sued BDO Global in New York Federal Court and BDO Seidman in arbitration for gross negligence for their "massive multiple audit failures." Howard M. Ehrenberg, partner at Los Angeles-based SulmeyerKupetz law firm and the court appointed Chapter 7 bankruptcy Trustee for Axium International, Inc., and its subsidiaries, said that he was "stunned" when he discovered that Axium significantly underpaid federal payroll taxes. According to the IRS claim the underpayment exceeds $100 million. BDO Seidman's certified financial audits, however, had painted the picture of a substantially profitable company. "At the end of the day, it wasn't substantially, or partially, or even narrowly a profitable company. It was insolvent," said Ehrenberg. BDO Seidman, LLP, is the United States BDO entity that performed the Axium audits and BDO Global, B.V., manages and controls BDO firms worldwide and is responsible for the standards to be followed in all BDO audits, including the Axium audits. The complaint was filed by the Los Angeles-based law firm of Thomas, Alexander & Forrester, LLP. The complaint charges that BDO Seidman's certified financial statements "were a sham." The complaint further states that BDO Global promised "strict quality control" over its agent, BDO Seidman, but "BDO Global broke its promise." The complaint notes that when BDO Global broke its word, and BDO Seidman missed over $100 million in liabilities, huge losses followed. As a payroll company, Axium's business was to pay the studio's payrolls to employees and to pay the payroll taxes to the government. However, Axium significantly underpaid the taxes for years, and BDO missed it "year after year," says the complaint. In fact, Steven Thomas, partner at Thomas, Alexander & Forrester, says in the complaint that BDO's final reports, prepared just months prior to Axium's bankruptcy falsely "gave Axium a clean bill of health." "Certified public accountants like BDO Seidman owe a duty to the public, which the U.S. Supreme Court has defined as being the 'public watchdog,'" said Mr. Thomas. The complaint alleges that BDO Global was created to "manage and control" BDO Seidman and therefore also took on that public duty: "When BDO Global induces U.S. companies to use the BDO brand with promises of quality control, it cannot avoid public responsibility when the BDO- branded company harms citizens in the United States." The complaint alleges that BDO Global engaged in deceptive and unfair business practices and seeks more than $100 million in compensatory damages, punitive damages, and a Court injunction to stop BDO Global's deceptive practices. The matter is being investigated by the United States Attorney for the Central District of California. No charges have yet been filed. About Axium Axium International Inc. -- http://www.axium.com/-- provides payroll solutions for production. It offers various financial services and technology for the entertainment industry through Axium Global and Axium Global Workforce. It serves companies ranging from mid-market to Fortune 500. Axium International has offices in Los Angeles, New York, Burbank, Hollywood, Las Vegas, Toronto, Vancouver and London. The company filed for protection under Chapter 7 of the Bankruptcy Code on Jan. 8, 2008 (Bankr. C.D. Calif. Case No. 08-10277). Howard M. Ehrenberg, a partner at SulmeyerKupetz, has been appointed as Chapter 7 Trustee. BEARINGPOINT INC: Grant Thornton Eyes Firm's Consulting Units ------------------------------------------------------------- Emily Chasan at Reuters reports that Grant Thornton LLP CEO Ed Nusbaum said that the company may be interested in acquiring selected assets of BearingPoint, Inc. Citing Mr. Nusbaum, Reuters relates that if the assets come up for sale, Grant Thornton "would be interested in selected pieces, but certainly not the whole entity." Mr. Nusbaum said that Grant Thornton may want to acquire BearingPoint's government consulting and general business consulting units, but wouldn't want the information technology system implementation business, Reuters states. According to Reuters, several possible suitors have been considering buying parts of BearingPoint since it filed for bankruptcy. Citing two people familiar with the matter, Reuters says that Accenture Ltd has hired Duff & Phelps to advise on a possible acquisition of BearingPoint's Asia business, which wasn't included in the bankruptcy filing. About BearingPoint Inc. BearingPoint, Inc. -- http://www.BearingPoint.com-- is currently one of the world's largest providers of management and technology consulting services to Global 2000 companies and government organizations in more than 60 countries worldwide. Based in McLean, Va., BearingPoint -- a former consulting arm of KPMG LLP -- has approximately 15,000 employees focusing on the Public Services, Commercial Services and Financial Services industries. BearingPoint professionals have built a reputation for knowing what it takes to help clients achieve their goals, and working closely with them to get the job done. The Company's service offerings are designed to help clients generate revenue, increase cost-effectiveness, manage regulatory compliance, integrate information and transition to "next-generation" technology. BearingPoint, Inc. fka KPMG Consulting, Inc., together with its units, filed for Chapter 11 on February 18, 2009 (Bankr. S.D. N.Y., Case No. 09-10691). Alfredo R. Perez, Esq. at Weil Gotshal & Manges LLP, has been tapped as counsel. Greenhill & Co., LLC, and AP Services LLC, have also been tapped as advisors. Davis Polk & Wardell is special corporate counsel. BearingPoint disclosed total assets of $1,762,689,000, and debts of $2,231,839,000 as of Sept. 30, 2008. Contemporaneous with their bankruptcy petitions, the Debtors filed a pre-packaged Joint Plan of Reorganization under Chapter to implement the terms of their agreement with the secured lenders. Under the Plan, the Debtors propose to exchange general unsecured claims for equity in the reorganized company. Existing shareholders are out of the money. The Plan and the explanatory disclosure statement remain subject to approval by the Bankruptcy Court. BLOCKBUSTER INC: Bank Debt Trades at 30% Off in Secondary Market ---------------------------------------------------------------- Participations in a syndicated loan under which Blockbuster Inc. is a borrower traded in the secondary market at 69.20 cents-on- the-dollar during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. This represents an increase of 1.90 percentage points from the previous week, the Journal relates. The loan matures August 20, 2011. Blockbuster pays 375 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B1 rating and Standard & Poor's B rating. Syndicated loans of fellow retailers slid in secondary market trading during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. Participations in a syndicated loan under which Neiman Marcus Group Inc. is a borrower traded in the secondary market at 65.07 cents-on-the-dollar, a drop of 1.80 percentage points -- at 66.86 cents-on-the-dollar -- from the previous week. The bank loan matures April 6, 2013. Neiman Marcus pays 175 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's Ba3 rating and Standard & Poor's BB rating. Michaels Stores Inc. bank debt traded in the secondary market at 56.36 cents-on-the-dollar, a drop of 1.83 percentage points -- 58.19 cents-on-the-dollar -- from the previous week. The bank loan matures October 31, 2013. Michaels Stores pays 225 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B2 rating and Standard & Poor's B rating. Burlington Coat Factory Warehouse Corp bank debt traded in the secondary market at 35.29 cents-on-the-dollar, a drop of 2.13 percentage points -- at 37.42 cents-on-the-dollar -- from the previous week. The syndicated loan matures May 28, 2013. Burlington Coat pays 225 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B3 rating and Standard & Poor's CCC+ rating. On the other hand, bank debt of toy seller Toys R Us traded in the secondary market at 55.50 cents-on-the-dollar an increase of 2.50 percentage points from the previous week. The loan matures on July 19, 2012. Toys R Us pays 425 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B2 rating and Standard & Poor's BB- rating. About Blockbuster Headquartered in Dallas, Texas, Blockbuster Inc. (NYSE: BBI, BBI.B) -- http://www.blockbuster.com/-- is a provider of in-home movie and game entertainment, with over 7,800 stores throughout the Americas, Europe, Asia and Australia. The company maintains operations in Brazil, Mexico, Denmark, Italy, Taiwan, and Australia. * * * In August 2008, Moody's Investors Service downgraded Blockbuster Inc.'s probability of default rating to Caa1 from B3. The company's Caa1 corporate family rating, Caa2 senior subordinated note rating, and SGL-4 speculative grade liquidity rating were affirmed. At the same time, Moody's raised the company's secured bank facilities to B1 from B3. Moody's said that the outlook remains negative. In December 2007, Fitch Ratings affirmed Blockbuster Inc.'s long- term Issuer Default Rating at 'CCC' and the senior subordinated notes at 'CC/RR6'. Fitch said that the rating outlook is stable. BRIAN STARCHER: Files for Chapter 7 Liquidation ----------------------------------------------- Brian Starcher and his wife, Shannon, have filed for Chapter 7 liquidation, WSOCTV.com reports, citing the attorney for the Debtors. According to WSOCTV.com, the Starchers own south Charlotte bridal shop La Bella Sposa. The report says that La Bella Sposa closed in June 2009, affecting dozens of brides who weren't able to get their gowns. The Starchers, WSOCTV.com states, also face civil lawsuits. Citing The Better Business Bureau, WSOCTV.com relates that La Bella Sposa had 43 complaints against it. BURLINGTON COAT: Bank Debt Continues Slide; Trades at 65% Off ------------------------------------------------------------- Participations in a syndicated loan under which Burlington Coat Factory Warehouse Corp is a borrower traded in the secondary market at 35.29 cents-on-the-dollar during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. This represents a drop of 2.13 percentage points -- at 37.42 cents-on-the-dollar -- from the previous week, the Journal relates. The syndicated loan matures May 28, 2013. Burlington Coat pays 225 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B3 rating and Standard & Poor's CCC+ rating. Syndicated loans of fellow retailers also slid in secondary market trading during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. Participations in a syndicated loan under which Michaels Stores Inc. is a borrower traded in the secondary market at 56.36 cents- on-the-dollar, a drop of 1.83 percentage points -- 58.19 cents-on- the-dollar -- from the previous week. The bank loan matures October 31, 2013. Michaels Stores pays 225 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B2 rating and Standard & Poor's B rating. Neiman Marcus Group Inc. bank debt traded in the secondary market at 65.07 cents-on-the-dollar, a drop of 1.80 percentage points -- at 66.86 cents-on-the-dollar -- from the previous week. The bank loan matures April 6, 2013. Neiman Marcus pays 175 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's Ba3 rating and Standard & Poor's BB rating. Meanwhile, bank debt of video-rental company Blockbuster Inc. traded in the secondary market at 69.20 cents-on-the-dollar. Trading in the bank debt increased 1.90 percentage points from the previous week, the Journal relates. The loan matures August 20, 2011. Blockbuster pays 375 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B1 rating and Standard & Poor's B rating. Bank debt of toy seller Toys R Us traded in the secondary market at 55.50 cents-on-the-dollar an increase of 2.50 percentage points from the previous week. The loan matures on July 19, 2012. Toys R Us pays 425 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B2 rating and Standard & Poor's BB- rating. About Burlington Coat Factory Burlington Coat Factory Warehouse Corporation, headquartered in Burlington, New Jersey, is a nationwide off price apparel retailer that operates approximately 427 stores in 44 states under the nameplates of Burlington Coat Factory, Cohoes, MJM, and Baby Depot. Revenues for the twelve month period ended November 29, 2008 were approximately $3.5 billion. CABLEVISION SYSTEMS: Posts $321.4MM Net Loss in 4th Quarter 2008 ---------------------------------------------------------------- Nat Worden and Vishesh Kumar at The Wall Street Journal report that Cablevision Systems Corp. swung to a loss of $321.4 million in the fourth quarter 2008, from a year-earlier net income of $6.6 million, amid a $402 million write-down from the firm's recently acquired Newsday newspaper and slowing subscriber growth at its cable business. WSJ relates that Cablevision continued to generate healthy cash flow. According to the report, Cablevision's chief operating officer, Tom Rutledge, said that cable-subscriber growth in the current quarter has so far surpassed that of last year's first quarter at the same point. "There doesn't appear to be any significant change at all in our metrics with regard to the economic situation," and the cable business tends to be "countercyclical," the report quoted Mr. Rutledge as saying. Fourth quarter consolidated net revenues grew 11.4% to $2.052 billion compared to the prior year period, reflecting solid revenue growth in Telecommunications Services, Rainbow and the addition of Newsday and Sundance in the 2008 results. Consolidated adjusted operating cash flow (AOCF) 1 was essentially flat (down 0.9% to $604.7 million) compared to the prior year period, and consolidated operating income (which includes impairment charges of $402.4 million at Newsday and $41.0 million at VOOM HD) decreased to an operating loss of $136.5 million. For full year 2008, consolidated net revenues increased 11.5% to $7.230 billion, reflecting revenue growth in Cable Television, Rainbow and Madison Square Garden as well as the addition of Newsday and Sundance in the 2008 results. Consolidated AOCF grew 10.1% to $2.298 billion and consolidated operating income decreased 24.3% to $689.7 million for full year 2008. (Full year 2008 operating income was unfavorably impacted by the impairment charges noted above.) Operating highlights for the fourth quarter and full year 2008 include: -- Cable Television net revenue growth of 7.4% and 9.1% and AOCF growth of 4.1% and 10.7% for the fourth quarter and full year, respectively -- Revenue Generating Units (RGU) additions of 100,500 and 653,400 for the fourth quarter and full year, respectively -- Average Monthly Revenue per Basic Video Customer (RPS) of $134.85 in the fourth quarter of 2008 -- Full year Consolidated Free Cash Flow from Continuing Operations of $507.5 million Cablevision President and CEO James L. Dolan said, "Cablevision delivered strong results for 2008. Despite the economic downturn, the company reported full year, double-digit increases in revenue and AOCF. Our ongoing success in attracting new customers ensured our industry-leading penetration rates throughout the year. Also noteworthy in 2008, was that Cablevision generated more than $500 million in free cash flow, compared with $158 million in 2007. The proceeds from our recent successful debt financings, our cash flow and the capacity we have under existing credit facilities have positioned us well from a near- term liquidity perspective." Telecommunications Services Telecommunications Services includes Cable Television -- Cablevision's "Optimum" branded video, high-speed data, and voice residential and commercial services offered over its cable infrastructure -- and its "Optimum Lightpath" branded commercial data and voice services. Telecommunications Services net revenues for fourth quarter 2008 rose 7.9% to $1.313 billion, AOCF grew 4.7% to $521.0 million and operating income increased 11.0% to $297.1 million, all compared to the prior year period. Full year 2008 net revenues rose 9.4% to $5.165 billion, AOCF increased 11.3% to $2.036 billion, and operating income increased 28.3% to $1.122 billion, all as compared to the prior year. Cable Television Cable Television fourth quarter 2008 net revenues increased 7.4% to $1.258 billion, AOCF rose 4.1% to $498.1 million and operating income increased 10.0% to $293.5 million, each compared to the prior year period. The increases in net revenues, AOCF and operating income were principally driven by the growth in digital video, high-speed data, and voice customers as well as higher rates reflected in fourth quarter 2008 results. The fourth quarter 2008 results reflect: -- Basic video customers down 3,800 or 0.1% from September 2008 and down 14,900 or 0.5% from December 2007 -- Customer Relationships flat from September 2008 and up 8,300 or 0.2% from December 2007 -- iO: Interactive Optimum digital video customers up 22,800 or 0.8% from September 2008 and 208,500 or 7.9% from December 2007 -- Optimum Online high-speed data customers up 28,200 or 1.2% from September 2008 and 173,200 or 7.6% from December 2007 -- Optimum Voice customers up 53,400 or 2.9% from September 2008 and 286,600 or 18.0% from December 2007 -- Revenue Generating Units up 100,500 or 1.0% from September 2008 and 653 400 or 6.8% from December 2007 -- Cable Television RPS of $134.85, up $1.74 or 1.3% from the third quarter of 2008 and up $9.75 or 7.8% from the fourth quarter of 2007 Optimum Lightpath For fourth quarter 2008, Lightpath net revenues rose 16.2% to $65.2 million, AOCF increased 20.6% to $22.8 million and operating income improved $2.7 million to $3.6 million, each as compared to the prior year period. The increase in net revenues, AOCF and operating income were due principally to the continued expansion of the more efficient, higher margin Ethernet business and includes the impact of the acquisition of 4Connections in October 2008. Rainbow Rainbow consists of the Rainbow National Services (RNS) -- AMC, WE tv and IFC -- as well as Other Programming which includes: News 12 Networks VOOM HD (domestic programming discontinued in January 2009), Sundance (effective June 16, 2008), Lifeskool (sold in October 2008), sportskool (sold in September 2008), IFC Entertainment, Rainbow Network Communications, Rainbow Advertising Sales Corp. and other Rainbow ventures. Rainbow net revenues for the fourth quarter of 2008 increased 13.9% to $263.9 million, AOCF rose 15.2% to $66.3 million, and operating income decreased $43.9 million to an operating loss of $9.2 million, all compared to the prior year period. Full year 2008 net revenues rose 16.2% to $980.1 million, AOCF grew 30.2% to $251.8 million and operating income decreased 9.9% to $78.1 million, all compared to 2007. AMC/WE tv/IFC Fourth quarter 2008 net revenues grew 6.7% to $191.3 million, AOCF increased 7.3% to $85.6 million and operating income grew 7.8% to $69.8 million, each compared to the prior year period. The fourth quarter 2008 AOCF results reflect: -- Viewing subscriber increases of 9.6% at IFC, 6.6% at WE tv and 2.0% at AMC, all compared to December 2007 -- A 9.0% increase in affiliate revenue compared to the prior year period -- A 2.8% increase in advertising revenue, as compared to the prior year period, driven principally by growth at WE tv -- A 6.2% increase in operating costs compared to the prior year period, primarily due to increased programming costs. Other Programming Fourth quarter 2008 net revenues rose 36.2% to $78.6 million, AOCF deficit improved 13.0% to a deficit of $19.3 million and operating loss increased $48.9 million to a loss of $79.0 million, all as compared to the prior year period. The increase in net revenue and improvement in AOCF was driven primarily by the addition of Sundance in the 2008 quarterly results. Fourth quarter operating loss is primarily attributable to charges for impairment of programming rights of $41.0 million and employee severance and other costs of $5.8 million as a result of the Company's decision in December 2008 to cease funding the U.S. programming business of VOOM HD. Madison Square Garden Madison Square Garden's primary businesses include: regional and national programming networks (MSG, MSG Plus, and Fuse), professional sports franchises (the New York Knicks, the New York Rangers, and the New York Liberty), and MSG Entertainment. Its operations also include the MSG Arena, the WaMu Theater at Madison Square Garden, Radio City Music Hall, Beacon Theatre and The Chicago Theatre. Madison Square Garden's fourth quarter 2008 net revenues decreased 2.1% to $405.8 million, AOCF decreased 64.9% to $27.7 million and operating income decreased 85.8% to $8.8 million, all compared to fourth quarter 2007. MSG's fourth quarter results were impacted by: -- The networks, including a $12.2 million increase in affiliate fee revenue which more than offset $4.2 million of higher direct operating costs -- The entertainment business, as revenues from its winter- themed productions declined $19.7 million (primarily due to the downturn in the economy) while related costs increased $9.6 million due mostly to the launch of an arena-sized touring production of the Christmas Spectacular in fourth quarter 2008. In addition, revenue and costs related to concerts and other entertainment events decreased $8.0 million and $1.7 million, respectively -- The teams, including a $7.5 million increase in revenues, primarily due to ticket sales, offset by an $11.5 million increase in net provisions for certain team personnel transactions and an $8.1 million increase in other team operating expenses, primarily team personnel compensation -- Higher marketing costs of $4.7 million and net higher legal fees, provisions for litigation and other professional fees of $5.0 million. Madison Square Garden's full year 2008 net revenues increased 4.1% to $1.043 billion, AOCF decreased 54.6% to $61.8 million and operating income decreased $79.1 million to a loss of $17.2 million, all as compared to the prior year. Newsday The Newsday segment consists of Newsday, a daily newspaper that primarily serves Long Island; amNewYork, a free daily serving New York City; various Internet properties including Newsday.com, Island Publications (through December 2008) and Star Community Publishing, the northeast's largest group of weekly shopper publications. Newsday's fourth quarter 2008 net revenues were $107.1 million, AOCF was $10.3 million and operating loss was $407.6 million. Operating loss was impacted by $402.4 million in impairment charges taken in the fourth quarter 2008. These impairment charges reflect the continuing deterioration of values in the newspaper industry and the greater than anticipated economic downturn and its current and anticipated impact on Newsday's advertising business. The impairment charges are not expected to result in any material future cash expenditures. For the period from the date of acquisition (July 29, 2008) through December 31, 2008, Newsday's net revenues were $180.6 million, AOCF was $18.8 million and operating loss was $403.3 million. Other Matters On February 25, 2009, the Board of Directors of Cablevision declared a quarterly dividend of $0.10 per share on each outstanding share of both its Cablevision NY Group Class A Stock and its Cablevision NY Group Class B Stock. This quarterly dividend is payable on March 31, 2009 to shareholders of record at the close of business on March 9, 2009. About Cablevision Systems Corp. Headquartered in Bethpage, New York, Cablevision Systems Corp. (NYSE: CVC) -- is a cable operator in the United States that operates cable programming networks, entertainment businesses and telecommunications companies. Through its wholly owned subsidiary, Rainbow Media Holdings LLC, Cablevision owns interests in and manages numerous national and regional programming networks, the Madison Square Garden sports and entertainment businesses, and cable television advertising sales companies. Through Cablevision Lightpath Inc., its wholly owned subsidiary, the company provides telephone services and Internet access to the business market. At September 30, 2008, the company's consolidated balance sheet showed $9.7 billion in total assets and $14.6 billion in total liabilities, resulting in a $4.9 billion total stockholders' deficit. * * * As reported by the Troubled Company Reporter on February 11, 2009, Standard & Poor's Ratings Services said it assigned its 'BB' issue-level and '3' recovery ratings to CSC Holdings Inc.'s proposed $500 million senior notes due 2019. The '3' recovery rating indicates the expectation for meaningful (50%-70%) recovery of principal in the event of payment default. At the same time, S&P placed the 'BB+' rating on $650 million of senior secured debt of majority-owned Newsday LLC on CreditWatch with negative implications. The 'BB' corporate credit rating on parent Cablevision Systems Corp. remains unchanged. Bethpage, New York-based Cablevision is a major cable operator in the New York metropolitan area. CANWEST GLOBAL: Tries to Reinstate Credit Facility -------------------------------------------------- Wojtek Dabrowski at Reuters reports that Canwest Global Communications Corp. is trying to reinstate a credit facility to let the Company continue to shore up operations and avert a possible bankruptcy filing. According to Reuters, Canwest Global said in February that its banks had limited borrowing on a C$300 million senior credit facility until February 27 to C$20 million above the C$92 million that had already been given to the Company's Canwest Media unit. Canwest Global, Reuters relates, said that it was still negotiating to try to lift the borrowing cap after Friday and allow Canwest Media to comply with its debt covenants. Reuters, citing CIBC World Markets analyst Bob Bek, relates that Canwest Global's lenders may be willing to give the Company more time if it can convince the banks it can turn itself around. "I still think it's a softer deadline and that it is easily extended if Canwest has enough concrete 'works in progress' to ease concerns. The banks don't want to force this prematurely," Reuters quoted Mr. Bek as saying. Citing analysts, Reuters states that Canwest Global has a debtload of about C$3.7 billion and may file for bankruptcy protection as the weak economy continues to hurt advertising revenues at the Company's television stations and newspapers. Reuters reports that Canwest Global is trying to cut its operating and capital costs and may divest non-core assets. Canwest Global, says the report, is considering selling five conventional TV stations and has said that it will sell its stake in Score Media. About Canwest Global Communications Corp. Canwest Global Communications Corp. -- http://www.canwest.com/-- (TSX: CGS and CGS.A,) an international media company, is Canada's largest media company. In addition to owning the Global Television Network, Canwest is Canada's largest publisher of English language daily newspapers and owns, operates and/or holds substantial interests in conventional television, out-of-home advertising, specialty cable channels, web sites and radio stations and networks in Canada, New Zealand, Australia, Turkey, Indonesia, Singapore, the United Kingdom and the United States. * * * As reported in the Troubled Company Reporter on Jan. 16, 2009, Canwest Global Communications Corp. warned that based on current revenue and expense projections, it may not be able to comply with its existing quarterly total financial leverage ratio covenants in fiscal 2009. Continuation of negative conditions may affect the Company's ability to meet certain financial covenants in its credit facilities. The company is reviewing and implementing strategies to ensure compliance with its covenants, including strategies intended to improve profitability and reduce debt. The TCR reported on Jan. 19, 2009, that Standard & Poor's Ratings Services lowered its long-term corporate credit rating on Winnipeg, Manitoba-based Canwest Media Inc. to 'CCC+' from 'B'. At the same time, S&P lowered the senior secured debt rating on wholly owned subsidiary Canwest Limited Partnership to 'B-' from 'BB-'. In addition, S&P lowered the senior subordinated debt ratings on Canwest Media and Canwest LP to 'CCC-' from 'CCC+'. S&P removed all ratings from CreditWatch with negative implications, where they were placed Oct. 31, 2008. The outlook is negative. The TCR reported on Feb. 16, 2009, that Wojtek Dabrowski at Reuters reported that Canwest Global Communications Corp. may go bankrupt. "They're on the verge of bankruptcy. The equity has been reflecting that for some time," Reuters quoted CIBC World Markets analyst Bob Bek as saying. According to Reuters, Canwest Global shares were trading at 49 Canadian cents each on the Toronto Stock Exchange, compared to C$6.11 each in 2008. CANWEST MEDIA: Lenders Extends Waiver to March 11; Talks Continue ----------------------------------------------------------------- Canwest Global Communications Corp. said its subsidiary, Canwest Media Inc. and its senior lenders have agreed to extend the waiver of certain borrowing conditions until March 11, 2009 and a permanent reduction in its senior credit facility to $112 million. On February 2, 2009, CMI reached an agreement with the senior lenders which waived certain borrowing conditions and limited availability under the senior credit facility to $112 million. Currently the Company has $92 million drawn under this facility. Based upon cash on hand and current cash flow projections, the Company believes that it will have sufficient liquidity to enable it to continue to operate normally through this period. The parties will continue discussions, which, if successful, would extend CMI's access to its credit facility beyond March 11, 2009. Canwest continues to take proactive steps to reduce its operating and capital costs, restructure its operations and improve efficiencies. It is also reviewing its strategic alternatives and continues to actively pursue opportunities to divest of non-core operations and assets, and collect other amounts that it is owed. About Canwest Global Communications Based in Winnipeg, Manitoba, in Canada, Canwest Global Communications Corp. (TSX: CGS and CGS.A,) -- http://www.canwest.com-- an international media company, is Canada's largest media company. In addition to owning the Global Television Network, Canwest is Canada's largest publisher of English language daily newspapers and owns, operates or holds substantial interests in conventional television, out-of-home advertising, specialty cable channels, web sites and radio stations and networks in Canada, New Zealand, Australia, Turkey, Indonesia, Singapore, the United Kingdom and the United States. Canwest Media Inc. is wholly-owned by Canwest Global Communications Corp. Substantially all of the publicly traded parent company's operations are held though Canwest. * * * As reported by the Troubled Company Reporter on February 25, 2009, Moody's Investors Service downgraded Canwest Media Inc.'s corporate family rating and probability of default rating to Caa3 from B3. The corporate family's consolidated speculative grade liquidity rating remains SGL-4 (indicating poor liquidity) and the company's ratings outlook remains negative. At the same time, instrument ratings for Canwest and its two rated affiliates, CW Media Holdings Inc. and Canwest Limited Partnership were also downgraded. The TCR said February 12 that Standard & Poor's Ratings Services lowered its long-term corporate credit rating on Winnipeg, Man.- based Canwest Media Inc. to 'CCC' from 'CCC+'. The outlook is negative. At the same time, S&P lowered the senior secured debt rating on wholly owned subsidiary Canwest Limited Partnership to 'CCC+' from 'B-'. The recovery rating on Canwest LP's secured debt is unchanged at '2', indicating an expectation of substantial (70% - 90%) recovery in the event of a payment default. CAPMARK FINANCIAL: Fitch Downgrades Issuer Default Rating to 'B-' ----------------------------------------------------------------- On Feb. 26, 2009, Fitch Ratings downgraded Capmark Financial Group's long-term Issuer Default Rating to 'B-' from 'BBB-' following the company's announcement of significant fourth quarter 2008 charges and the withdrawal of its application to become a bank holding company. The rating was also placed on Rating Watch Negative. Capmark Financial Group is the parent of CMBS servicer Capmark Finance Inc. Due to the corporate rating downgrade, Fitch has placed Capmark Finance Inc.'s CMBS servicer ratings on Rating Watch Negative. Fitch rates Capmark Finance Inc.: -- Primary Servicer 'CPS1-'; -- Master Servicer 'CMS1-'; -- Special Servicer 'CSS1'. Fitch will continue to closely monitor the financial condition of Capmark Financial Group and the operational performance of Capmark Finance Inc. and will take ratings actions or provide further commentary, as necessary. As of Dec. 31, 2008, Capmark Finance Inc.'s total primary servicing portfolio was comprised of 34,040 loans with an unpaid principal balance of $250.8 billion, of which 17,659 loans totaling $136.6 billion were commercial mortgage-backed securities. At that date Capmark was named master servicer on 295 CMBS transactions. Also as of Dec. 31, 2008, Capmark was named special servicer on 116 CMBS transactions with an outstanding balance of $49.2 billion. At that time, the company actively specially serviced 150 CMBS loans totaling $1.07 billion, and managed 43 CMBS real estate owned properties valued at $267 million. Fitch rates commercial mortgage primary, master, and special servicers on a scale of 1 to 5, with 1 being the highest rating. CAPMARK FINANCIAL: Moody's Downgrades Senior Ratings to 'Ba2' ------------------------------------------------------------- Moody's Investors Service downgraded the senior unsecured ratings of Capmark Financial Group Inc. to Ba2 from Baa3, and placed the ratings under review for further possible downgrade. This rating action was prompted by Capmark's announcement that it expects to report an estimated pre-tax loss of $800 million for 4Q08. As a result, Capmark's leverage should rise materially as their expected loss represents approximately one-third of their 3Q08 book equity. The company also announced that it is possible that the net loss could be higher which would cause their leverage ratio (as defined under its senior credit facility) to exceed its maximum level. Capmark is currently seeking modifications of its senior credit facility, which includes the bridge loan maturing March 23, 2009. The real estate capital markets remain frozen and the resulting downward pressure on Capmark's asset valuations and credit migration is expected to continue. Commercial property values declined sharply in 2008 and are expected to continue falling over the next 12 to 24 months. Moody's expects Capmark's delinquencies to continue to rise as the constrained capital markets hinder the ability of borrowers to refinance maturing obligations. Adding further pressure, most of Capmark's loan portfolio was originated during 2006 and 2007 -- a cyclical peak in real estate valuations. As a result, Capmark's equity base could continue to erode in 2009. Moody's ratings review will focus on the completed financial results for 4Q08, Capmark's ability to obtain covenant relief from its banks, its liquidity outlook in light of borrower refinancing difficulties, its earnings outlook and the impact to its franchise, and any parental support that may be required at Capmark Bank over the near term. Moody's noted that its review could result in multiple notch downgrades, especially if the company breaches its bank covenants. Moody's indicated that a stable outlook would require Capmark to manage through the market downturn, while demonstrating the strength of its franchise and underwriting as measured by the maintenance of current market share, and no more than a modest increase in credit losses. A downgrade would likely occur from these events: (1) leverage rising above 10X as a result of further losses, (2) liquidity becoming stressed as a result of material declines in asset repayments or reduced capacity with its existing funding sources, or (3) market share declines resulting in a diminished franchise value, particularly in servicing and origination businesses. Any upward ratings momentum would be difficult and predicated upon de-leveraging the company, through debt reduction or equity contributions, a more laddered debt maturity schedule, progress in reducing secured debt, and a stabilization of commercial property fundamentals. These ratings were downgraded and placed under review for possible downgrade: * Capmark Financial Group Inc. -- senior unsecured debt to Ba2 from Baa3 Moody's last rating action with respect to Capmark Financial Group was on October 15, 2008, when Moody's revised the rating outlook to negative. Capmark Financial Group Inc., formerly known as GMAC Commercial Holding Corp., is an industry leader in the commercial real estate finance, investments and services, with 55 offices worldwide. It is headquartered in Horsham, Pennsylvania, USA. Capmark Financial Group's ratings were assigned by evaluating factors Moody's believe are relevant to the credit profile of the issuer, such as i) the business risk and competitive position of the company versus others within its industry, ii) the capital structure and financial risk of the company, iii) the projected performance of the company over the near to intermediate term, and iv) management's track record and tolerance for risk. These attributes were compared against other issuers both within and outside of Capmark's core industry and the company's ratings are believed to be comparable to those of other issuers of similar credit risk. CEQUEL COMMUNICATIONS: Moody's Puts Pos. Outlook; Keeps B2 Rating ----------------------------------------------------------------- Moody's Investors Service has revised Cequel Communications, LLC's outlook to positive from stable and affirmed all other ratings. The positive outlook reflects Moody's expectation that revenues and margins will continue to increase over the rating horizon as penetration of high speed data and telephony services grow further, resulting in ongoing reduction of financial leverage to more conservative levels over the next 12 -to-18 months. In addition, Moody's believes Cequel's just-closed amendment also provides for opportunistic deleveraging via approved debt repurchases that are likely to occur on a discounted basis, but remains cautious given uncertainty surrounding the amount and price of debt that may be retired. Moody's does, however, note that if successful tenders are effected for the maximum amount permitted under terms of the amendment, then proforma leverage (Moody's adjusted Debt-to-EBITDA, including the deemed debt-like preferred stock of parent company Cequel Communications Holdings, LLC) for the period ended December 31, 2008 would likely approach the low 6x range, and lower on an annualized basis. "The company continues to perform at levels that are either consistent with or ahead of prior expectations," noted Moody's Senior Vice President Russell Solomon. "Notwithstanding the ongoing challenges faced by virtually all companies given very difficult macroeconomic conditions, the cable TV industry continues to fare well -- on both an absolute and certainly a comparative basis," added Mr. Solomon. The amendment to Cequel's credit facilities allows for the repurchase of its first and/or second lien term loans via permitted cash distributions through the restricted payment basket (with a $150 million cap on total cash consideration) to Cequel Communications Holdings I, LLC and an ongoing modified Dutch Auction process, with any successful debt repurchases subsequently assigned to Cequel for cancellation. Notably, market conservatism was evidenced in final negotiated terms as the Company must continue to meet a proforma liquidity test (set at $200 million of cash and/or revolver availability) at the time of any buyback and the buyback window was limited to just 12 months, with originally proposed sponsor tag-along rights being removed in the final version and any redemption of PIK preferred stock at Cequel Communications Holdings, LLC as still permitted triggering an automatic termination of the buyback window. These summarizes Moody's rating actions and current ratings: Cequel Communications, LLC -- Corporate Family Rating -- Affirmed B2 -- Probability of Default Rating -- Affirmed B2 -- First Lien Credit Facilities -- Affirmed B1 (to LGD 3, 37% from LGD 3, 38%) -- Second Lien Credit Facilities -- Affirmed Caa1 (LGD 5, 89%) The rating outlook has been revised to positive from stable. The last rating action for Cequel was on March 20, 2007 when Moody's affirmed the Company's B2 CFR and PDR. Cequel Communications, LLC, headquartered in St. Louis, Missouri and doing business as Suddenlink Communications, is a cable operating company serving approximately 1.3 million video customers. The Company provides digital TV, high-speed Internet and telephone service for the home and office and generated revenues of approximately $1.4 billion for the fiscal year ended December 31, 2008. CHARYS HOLDING: Wins Confirmation of Chapter 11 Plan ---------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York has affirmed that Charys Holding Co.'s Chapter 11 plan satisfies the statutory requirements for confirmation under Section 1129 of the Bankruptcy Code. According to Bloomberg's Bill Rochelle, the Court-confirmed plan gives the convertible noteholders 94% of the new stock, plus $20 million in secured notes maturing in four years and paying 15% interest, for a recovery estimated at 32.5%. Unsecured creditors with $107 million in claims participate in collections by a liquidating trust and are expected to see nothing to 15%. Subordinated claims are wiped out along with existing stockholders. As reported in the Troubled Company Reporter on Jan. 13, 2009, the Court approved on Jan. 8, the adequacy of the modified disclosure statement for the Debtors' First Amended Joint Plan of Reorganization, dated Jan. 6, 2009. A full-text copy of the First Amended Joint Plan of Reorganization is available for free at http://ResearchArchives.com/t/s?37e8 A full-text copy of the Disclosure Statement is available for free at http://ResearchArchives.com/t/s?37e9 About Charys Holding Headquartered in Atlanta, Georgia, Charys Holding Co., Inc. -- http://www.charys.com/-- provides remediation & reconstruction and wireless communications & data infrastructure. The company and its affiliated debtor, Crochet & Borel Services, Inc., filed for Chapter 11 protection on Feb. 14, 2008 (Bankr. Del. Lead Case No. 08-10289). Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Lydia T. Protopapas, Esq., at Weil, Gotshal & Manges LLP, represent the Debtors as counsel. Chun I. Jang, Esq., Mark D. Collins, Esq., and Paul N. Heath, Esq., at Richards, Layton & Finger, P.A., represent the Debtors as Delaware counsel. Matthew S. Barr, Esq., at Milbank, Tweed, Hadley & McCloy, LLP represents the Official Committee of Unsecured Creditors as counsel. Chad A. Fights, Esq., and Gregory W. Werkheiser, Esq., at Morris, Nichols, Arsht & Tunnell, represent the Committee as Delaware counsel. Chary's Holdings Co. Inc. reported total assets of $242.7 million and total liabilities of $378.6 million in its operating report for August 2008. CITY OF LA VERNE: S&P Affirms 'BB' Rating; Outlook Negative ----------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'BB' long-term rating and negative outlook on the City of La Verne, California's $45.51 million of debt, issued for Brethren Hillcrest Homes. Standard & Poor's based its rating affirmation and continuing negative outlook on its view of the recent improvement in management, firmer demand, and 2.0x adjusted debt service coverage for fiscal year ended June 30, 2008, which S&P deems adequate. In S&P's opinion, these credit strengths are offset by a weak balance sheet with high leverage and very modest liquidity. Also contributing to the negative outlook is the current severe recession that S&P believes is making Hillcrest's turnaround plans more difficult to implement in a timely manner. Management recently initiated a corrective action plan that included staff reductions and other means of boosting revenue and reducing cost to preserve and enhance cash flow and liquidity. Management also expects a stronger second half of fiscal 2009 and the full-year budget demonstrates a slightly better than breakeven year with further improvement expected in 2010. The outlook remains negative due to the ongoing liquidity pressure Hillcrest faces, despite recent indications that demand is firming up a bit and cash flow is improving because of the positive actions being taken by the new management team. "Any consideration of a higher rating would be predicated upon attainment of firmer occupancy levels, stabilization of financial results, and improved liquidity," said Standard & Poor's credit analyst Kenneth Rodgers. "A lower rating is possible, in S&P's opinion, if losses escalate and cash declines from present levels or if debt increases materially, although S&P does not expect the latter to occur," said Mr. Rodgers. Hillcrest operates a continuing-care retirement facility that currently has 232 independent-living units, 72 assisted-living units (including a 24-bed dementia facility), and 74 skilled- nursing-facility beds (although it is licensed for 79). The campus is located on 53 acres in La Verne, California approximately 30 miles east of Los Angeles. CITIGROUP INC: Gov't Grants Another Bailout in Exchange for Stake ----------------------------------------------------------------- David Enrich and Deborah Solomon at The Wall Street Journal report that the U.S. government will give Citigroup Inc. another bailout in exchange for as much as 36% stake in the bank. Citigroup will issue common stock in exchange for preferred securities, which will substantially increase its tangible common equity (TCE) without any additional U.S. government investment. The transaction is intended to build Citigroup's TCE to a level that removes uncertainty and restores investor confidence in the company. Citigroup will offer to exchange common stock for up to $27.5 billion of its existing preferred securities and trust preferred securities at a conversion price of $3.25 a share. The U.S. government will match this exchange up to a maximum of $25 billion face value of its preferred stock at the same conversion price.. Mr. Pandit said, "This securities exchange has one goal -- to increase our tangible common equity. While we believe Tier 1 capital remains the most important measure of the financial strength of banks, we recognize that the markets also view Tangible Common Equity as an important measure. This transaction -- which requires no additional investment from U.S. taxpayers -- does not change Citi's strategy, operations or governance. Our clients and partners will not be affected and will continue to receive the high level of service they expect from Citigroup around the world." This transaction could increase the TCE of the company from the fourth quarter level of $29.7 billion to as much as $81 billion, which assumes the exchange of $27.5 billion of preferred securities, the maximum eligible under this transaction. Citigroup's Tier 1 capital ratio is 11.9 percent as of December 31, 2008, and is among the highest of major banks. This ratio is not affected by this transaction. Based on the maximum eligible conversion, the U.S. government would own approximately 36% of Citigroup's outstanding common stock and existing shareholders would own approximately 26% of the outstanding shares. All investors' new stakes will be determined following the exchange. Citigroup will offer to exchange: -- Interim securities and warrants for privately held convertible preferred securities; -- Interim securities and warrants for U.S. government-held Preferred securities; and -- Common stock for publicly held convertible and non- convertible preferred securities. The interim securities will convert to common stock, subject to shareholder authorization of the additional common stock needed for the transaction. The interim securities are common stock equivalent. The warrants entitle the holders to purchase shares of Citigroup common stock at $0.01 a share if such shareholder authorization is not obtained. If shareholder authorization is not received, the interim securities will pay a 9% dividend that will increase quarterly. The non-U.S. government exchange will accommodate all preferred stock holders other than trust preferred holders. The Government of Singapore Investment Corporation (GIC), HRH Prince Alwaleed Bin Talal Bin Abdulaziz Alsaud, Capital Research Global Investors, Capital World Investors and other investors have said they will participate in the exchange. Depending upon the participation rate in the exchange, holders of Trust Preferred Securities (TruPs) and Enhanced Trust Preferred Securities (ETruPs) may also be eligible to participate. The U.S. government will exchange the portion of its existing preferred securities that is not exchanged for common shares into new trust preferred securities. These securities will carry an annual coupon of 8 percent. In connection with the transactions, Citigroup will suspend dividends on its preferred shares. As a result, the common stock dividend also will be suspended. The company will continue to pay the distribution on its Trust Preferred Securities and Enhanced Trust Preferred Securities at the current rates. OVERVIEW OF CITIGROUP TRANSACTION TO REALIGN CAPITAL STRUCTURE U.S. Government Preferred Stock Exchange _____________________________________________________________ Target Securities -- TARP Series H Preferred Stock ($25 billion) issued on October 28, 2008 _____________________________________________________________ Amount Exchanged -- Amount exchanged will equal the amount of preferred stock of private and public holders and trust preferred securities exchanged, up to $25 billion _____________________________________________________________ Exchange Price -- $3.25/share at par _____________________________________________________________ U.S. Treasury Receives -- Interim securities and _____________________________________________________________ Remaining Preferreds -- All outstanding preferred stock not exchanged for the interim securities will be exchanged for trust preferred securities with a coupon of 8% _____________________________________________________________ Non-target Securities -- TARP Series I Preferred Stock ($20 billion) issued on December 31, 2008, and Series G ($7 billion) will each convert into separate trust preferred securities with a coupon of 8% _____________________________________________________________ Privately Placed Convertible Preferred Stock Exchange _____________________________________________________________ Target Securities -- Private convertible preferred stock (series A1, B1, C1, D1, J1, K1, L2, N1) initially issued on January 23, 2008 _____________________________________________________________ Amount Exchanged -- Target $12.5 billion _____________________________________________________________ Exchange Price -- $3.25/share at par _____________________________________________________________ Investors Receive -- Interim securities and warrants _____________________________________________________________ Remaining Preferreds -- Dividends on outstanding Preferred stock not exchanged will be suspended _____________________________________________________________ Publicly Issued Straight and Convertible Preferred Stock and Trust Preferred Securities Exchange _____________________________________________________________ Target Securities -- Public preferred stock (series AA, E, F) issued in January, April and May 2008 -- Public convertible preferred (series T) issued in January 2008 -- Enhanced Trust Preferred Securities -- Trust Preferred Securities _____________________________________________________________ Amount -- Target $14.9 billion _____________________________________________________________ Exchange Price -- $3.25/share at premium to market _____________________________________________________________ Investors Receive -- Common stock _____________________________________________________________ Remaining Preferreds -- Dividends on outstanding Preferred stock not exchanged will be suspended _____________________________________________________________ -- eTruPS and TruPS Distributions remain unchanged _____________________________________________________________ Other Terms _____________________________________________________________ Maximum Exchange Amount -- Total of $27.5 billion of Privately placed and publicly issued preferred stock, and trust preferred securities _____________________________________________________________ Exchange Eligibility -- The exchange will Accommodate private and public preferred stock -- Depending upon the Participation rate in the exchange, TruPS and eTruPS may also be eligible to participate _____________________________________________________________ Interim Securities and Warrants _____________________________________________________________ Securities -- Common equivalent securities mandatorily convertible into common stock on a one-for- one basis upon stockholder vote _____________________________________________________________ Warrants -- Warrants to acquire up to 790 million shares of common stock at $0.01/share _____________________________________________________________ Stockholder Vote _____________________________________________________________ Interim Securities and Warrants -- No vote is required for the Issuance issuance of interim securities and warrants _____________________________________________________________ Authorized Common Stock -- Vote required for charter Amendment to increase authorized common stock to permit conversion of interim securities into common stock _____________________________________________________________ If Vote Passes -- Interim securities convert into common stock -- Warrants are cancelled _____________________________________________________________ If Vote Fails -- Interim securities receive Greater of dividend on common or dividend of 9%, which increases by 200 basis points every quarter until it reaches 19% -- Warrants become exercisable at any time _____________________________________________________________ Citigroup executives said that the Treasury Department and other banking regulators didn't try to squeeze new concessions from the bank, WSJ relates. Citigroup wasn't pushed to make more loans, rein in foreclosures or restrict executive pay beyond previously agreed or required levels, WSJ says, citing Citigroup executives. WSJ relates that the government has also decided not to oust Citigroup CEO Vikram Pandit, partly due to a lack of strong potential successors. The report states that Treasury Secretary Timothy Geithner and other government officials discussed over the past several days whether to require the removal Mr. Pandit. Richard Parsons, Chairperson of the Citigroup Board said, "On January 16, 2009, I announced on behalf of the Board of Directors that we had determined to 'reconstitute the board... as quickly as possible.' I am pleased to announce today the next step in reconstituting the Board: the Board unanimously decided to have a majority of new independent directors as soon as feasible. The Board presently has 15 directors, three of whom have announced that they will not be standing for election at the April Annual Meeting and two of whom will reach retirement age by the time of the Meeting. We are actively conducting a search and expect to announce several new directors shortly." Fourth Quarter Goodwill Impairment of $9.6 Billion Citigroup recorded a pre-tax goodwill impairment charge of approximately $9.6 billion ($8.7 billion after-tax) in the fourth quarter of 2008. Citigroup had previously announced in its fourth quarter earnings press release (January 16, 2009) that it was continuing to review its goodwill to determine whether a goodwill impairment had occurred as of December 31, 2008, and this charge is the result of that review and testing. The goodwill impairment charge was recorded in North America Consumer Banking, Latin America Consumer Banking, and EMEA Consumer Banking, and resulted in a write-off of the entire amount of goodwill allocated to those reporting units. The charge does not result in a cash outflow or negatively affect the Tier 1 or Total Regulatory Capital ratios, Tangible Common Equity or Citigroup's liquidity position as of December 31, 2008. In addition, Citigroup recorded a $374 million pre-tax charge ($242 million after-tax) to reflect further impairment evident in the intangible asset related to Nikko Asset Management at December 31, 2008. The primary cause for both the goodwill and the intangible asset impairments mentioned above was the rapid deterioration in the financial markets, as well as in the global economic outlook generally, particularly during the period beginning mid-November through year-end 2008. This deterioration further weakened the near term prospects for the financial services industry. Giving effect to these charges, Net Income (Loss) from Continuing Operations for 2008 was $(32.1) billion and Net Income (Loss) was $(27.7) billion, resulting in Diluted Earnings per Share of $(6.42) and $(5.59) respectively. About Citigroup Based in New York, Citigroup (NYSE: C) -- http://www.citigroup.com -- is organized into four major segments -- Consumer Banking, Global Cards, Institutional Clients Group, and Global Wealth Management. Citigroup had $2.0 trillion in total assets on $1.9 trillion in total liabilities as of Sept. 30, 2008. As reported in the Troubled Company Reporter on Nov. 25, 2008, the U.S. government entered into an agreement with Citigroup to provide a package of guarantees, liquidity access, and capital. As part of the agreement, the U.S. Treasury and the Federal Deposit Insurance Corporation will provide protection against the possibility of unusually large losses on an asset pool of approximately $306 billion of loans and securities backed by residential and commercial real estate and other such assets, which will remain on Citigroup's balance sheet. As a fee for this arrangement, Citigroup will issue preferred shares to the Treasury and FDIC. In addition and if necessary, the Federal Reserve will backstop residual risk in the asset pool through a non-recourse loan. CITIGROUP INC: Treasury to Participate in Exchange Offering ----------------------------------------------------------- Citigroup is planning to strengthen its capital structure through conversion of a significant portion of its preferred securities to common equity in a series of exchange offers. Citigroup requested that the Treasury participate in this exchange offer by converting a portion of its preferred security to common equity alongside the other preferred holders. The Treasury said in a statement that it is willing to participate in this arrangement to the extent Citigroup is able to reach agreement with its other preferred holders, under the following conditions: * Treasury would convert its security to match dollar for dollar the private preferred exchanges. * Treasury would convert up to the $25 billion of preferred stock issued under the Capital Purchase Program. Remaining Treasury and FDIC preferred issued under the Targeted Investment Program and Asset Guarantee Program would be converted into a trust preferred security of greater structural seniority that would carry the same 8% cash dividend rate as the existing issue. * Treasury will receive the most favorable terms and price offered to any other preferred holder through this exchange. This transaction does not increase the amount of Treasury's investment in Citigroup. Separately, the Chairman of the Board of Citigroup has informed us that the Company will be altering the Board of Directors so that a majority of the Board will be comprised of new independent directors as soon as feasible. Citigroup will be taking part, alongside other banks with over $100 billion in assets, in the forward-looking supervisory assessment process announced on February 25, 2009 as part of the Treasury Capital Assistance Program. In connection with this program, Citigroup will be allowed to apply for additional Mandatory Convertible Preferred securities or request conversion of the remaining preferred held by Treasury into these securities, consistent with the terms of the program. About Citigroup Based in New York, Citigroup (NYSE: C) -- http://www.citigroup.com -- is organized into four major segments -- Consumer Banking, Global Cards, Institutional Clients Group, and Global Wealth Management. Citi had $2.0 trillion in total assets on $1.9 trillion in total liabilities as of Sept. 30, 2008. As reported in the Troubled Company Reporter on Nov. 25, 2008, the U.S. government entered into an agreement with Citigroup to provide a package of guarantees, liquidity access, and capital. As part of the agreement, the U.S. Treasury and the Federal Deposit Insurance Corporation will provide protection against the possibility of unusually large losses on an asset pool of approximately $306 billion of loans and securities backed by residential and commercial real estate and other such assets, which will remain on Citigroup's balance sheet. As a fee for this arrangement, Citigroup will issue preferred shares to the Treasury and FDIC. In addition and if necessary, the Federal Reserve will backstop residual risk in the asset pool through a non-recourse loan. CONSECO INC: S&P Junks Local Currency Counterparty Credit Rating ---------------------------------------------------------------- Standard & Poor's Ratings Services said that it lowered its counterparty credit and financial strength ratings on 10 groups of U.S. life insurers and its counterparty credit ratings on seven U.S. life insurance holding companies. Standard & Poor's also said that it placed its ratings on two groups of U.S. life insurers, one of which was also downgraded, on CreditWatch with negative implications. At the same time, Standard & Poor's revised its outlook on an additional U.S. life insurer to negative from stable. In addition, S&P affirmed its ratings on two U.S. life insurers. In response to the extreme pressures in the global economy, S&P recently published criteria that outlined the incremental stress analysis S&P is now applying to U.S. insurers' bond holdings, commercial mortgages, and commercial mortgage-backed securities when S&P assess these companies' capital adequacy. The rating actions primarily reflect the incorporation of these incremental asset stress factors into S&P's capital adequacy analysis as well as the effects of severe equity market declines and volatility on earnings and capital adequacy. S&P expects that the effect of these factors will challenge life companies' competitive strengths and ability to generate profitable business. Over the past few weeks, S&P also took rating actions on several other life companies because of related issues. Within S&P's existing capital-adequacy analysis, S&P previously considered the effects of each firm's statutory impairments on fixed-income assets. The insurers affected by the rating actions had operating earnings -- on both U.S. GAAP and statutory bases -- that fell short of S&P's expectations and showed increased volatility. The depressed equity markets have driven the lower level of operating earnings, resulting in lower asset-based fees, higher costs associated with guaranteed benefits, increased write- offs of deferred acquisition costs (GAAP only), and reduced net investment income. In addition, the rating actions took into account the specific financial flexibility characteristics of each firm and their respective costs of capital given the financial markets. Given the disarray in the credit and capital markets, most insurers' financial flexibility has decreased in the past six months. The ability to access the markets varies by company and from day to day. The market dislocations are hampering two areas that S&P views as particularly important to financial flexibility: liquidity and access to the capital markets. The systemic concern regarding counterparty risk is generally heightened for financial firms. In addition, a lack of liquid markets for many securities has depressed overall access to liquidity for many corporations and financial institutions. The rating actions S&P took have incorporated these concerns. The pressures within the life sector have been building. In October 2008, S&P revised its outlook on the U.S. life insurance industry to negative from stable based on poor financial market conditions and the likelihood of a prolonged period of weaker- than-expected economic conditions. The outlook remains negative. Since October 2008, macroeconomic factors have continued to weaken, as the U.S. is in the midst of perhaps its longest recession in a generation, and S&P's economists believe it is just entering its most difficult phase. S&P's baseline economic forecast is for a deep and long recession, with a sluggish recovery beginning in mid-2009. Standard & Poor's economists are also forecasting negative GDP growth in the first half of 2009 after declines in the second half of 2008, for a total peak-to- trough decline of 3%. The dramatic rise in the expected level of corporate defaults reflects S&P's opinion of the weak credit profiles of many corporations going into this period of economic contraction. Given these difficult economic conditions, S&P believes that life insurers' bond holdings, commercial mortgages, and commercial mortgage-backed securities could experience unprecedented stress in the next 12-18 months. Although the rating actions reflect S&P's opinion of a general decline in the overall creditworthiness of the U.S. life insurance sector, S&P continues to believe the credit fundamentals of the life insurance industry are strong. S&P believes the U.S. life insurance sector remains well capitalized (even considering the incremental asset stress factors), maintains solid businesses, produces strong (albeit lower than historical) earnings, and maintains strong liquidity. The strong liquidity is paramount to S&P's opinion in determining the level of mark-to-market losses in an insurer's asset portfolio. S&P believes that strong liquidity and an insurer's willingness and ability to hold portfolio investments to maturity should provide the necessary bridge for insurers to get beyond the current distressed fixed-income markets. Nonetheless, S&P's capital adequacy analysis now quantitatively considers the projected economic losses on certain assets. Although short-term financial pressures are acute, S&P believes the industry's long-term fundamental strengths remain intact. In S&P's view, the life insurance sector remains well positioned to capture the opportunities in the retirement market. The sector also benefits -- more so than many other financial sectors -- from effective asset/liability management techniques, though current market conditions challenge the rigor of such initiatives. The recent market dislocations, in S&P's view, have challenged all enterprise risk management programs. Given the volatile equity market movements, S&P expects insurers with larger proportions of equity-related risks to improve their existing ERM programs and increase product pricing in new products. Despite the unfavorable market, S&P believes the life insurance industry is generally well positioned to meet its funding requirements. Companies are maintaining excess liquidity in these uncertain times. So far, financial leverage and coverage ratios are within tolerances for the ratings, and most have modest amounts of debt coming due in the second half of 2009 and into 2010. S&P applied the incremental stress analysis to bond holdings, commercial mortgage, and CMBS because these assets generally constitute, in aggregate, approximately 80% of U.S. life insurers' invested assets. Importantly, although S&P is not changing S&P's baseline insurance risk-based capital adequacy model, S&P is applying incremental stresses for these asset classes across all confidence levels during this difficult economic period. S&P is applying the incremental stress factors in a manner that is consistent with the approach taken in S&P's existing risk-based capital adequacy model. The incremental stresses that S&P is introducing seek to determine the amount of capital that an insurer would need to cover the calculated losses in the current economic environment at varying confidence intervals commensurate with ratings categories. S&P will continue to monitor, and possibly revise, the underlying assumptions to maintain their relevance as the events driving the credit cycle evolve. The capital adequacy outcome from the model, as well as from any stress analysis, is only a starting point for S&P's analysis of the overall capital adequacy of insurers. S&P typically apply qualitative and quantitative considerations as warranted to derive a more complete picture of an insurer's capital position. Similarly, S&P generally base its ratings on a broad-based analysis of an insurer's credit quality. Strengths or weaknesses in other key areas -- such as a company's competitive position, management and strategy, investment risk, liquidity risk, operating performance, enterprise risk management, and financial flexibility -- could in some cases more than offset relative strength or weakness in capital adequacy. In addition to the asset stress factors, the rating actions reflect a general overall decline in these major rating factors. S&P views these areas of analysis as being interconnected, and their importance and influence on a rating will differ depending on company-specific circumstances. S&P provides ratings on insurance companies in many parts of the world, and in the process, S&P encounter many different accounting frameworks. S&P's capital model is designed under a globally consistent framework by incorporating regional factors unique to a local market. It is an ongoing objective of Standard & Poor's to normalize the resulting capital measures on a basis that is consistent with U.S. statutory or GAAP/International Financial Reporting Standards accounting. For example, and subject to analytical judgment, S&P generally will not apply incremental stresses to the baseline insurance risk-based capital model when current values are reported on a marked-to-market basis because the figures already reflect the sharp declines in fair value, which in some cases exceed S&P's expectations. S&P could expand its analysis to include additional asset classes as the market conditions continue to evolve, updated information becomes available, and material losses emerge. Standard & Poor's will hold discussions with the companies with ratings on CreditWatch and maintain active surveillance of companies with negative outlooks to determine if any downgrades are warranted. S&P will also continue to evaluate the entire industry to determine which companies are susceptible to rapid and sustained change in stock or bond valuations and the overall impact on any such change on S&P's view of their financial flexibility. Given the current environment, S&P also could develop other incremental stress tests, such as assessing the potential impact of policyholder behavior in guaranteed annuity contracts, which could also affect ratings. In all cases, if actual experience is better than stress-test expectations, subsequent favorable rating actions could result. S&P has focused on U.S. life insurers in these rating actions, as a recent review of all U.S. insurers and the application of the enhanced criteria on the incremental asset stress factors reflects minimal capital adequacy impact to U.S. property/casualty and health insurers. In reviewing the initial results of the incremental stress analysis for these insurance sectors, S&P believes at this time that rating changes are unlikely in the immediate future. Summary Ratings List Americo Life Inc. To From -- ---- Counterparty Credit Rating Local Currency BBB-/Watch Neg/-- BBB- /Stable/-- Americo Financial Life & Annuity Insurance Co. To From -- ---- Counterparty Credit Rating Local Currency A-/Watch Neg/-- A- /Stable/-- Financial Strength Rating Local Currency A-/Watch Neg/-- A- /Stable/-- Conseco Inc. To From -- ---- Counterparty Credit Rating Local Currency CCC/Negative/-- B+/Negative/-- Conseco Inc.'s Core Insurance Operating Companies To From -- ---- Counterparty Credit Rating Local Currency BB-/Negative/-- BB+/Negative/-- Financial Strength Rating Local Currency BB-/Negative/-- BB+/Negative/-- Genworth Financial Inc. To From -- ---- Counterparty Credit Rating Local Currency BBB/Negative/A-2 A- /Negative/A-2 Genworth Financial Inc.'s Core Insurance Operating Companies* To From -- ---- Counterparty Credit Rating Local Currency A/Stable/-- AA- /Negative/-- Financial Strength Rating Local Currency A/Stable/-- AA- /Negative/-- * Some operating companies have 'A-1' short-term ratings. Hartford Financial Services Group Inc. To From -- ---- Counterparty Credit Rating Local Currency BBB+/Watch Neg/A-2 A-/Watch Neg/A-2 Hartford Financial Services Group Inc.'s Core Insurance Operating Companies* To From -- ---- Counterparty Credit Rating Local Currency A+/Watch Neg/-- AA-/Watch Neg/-- Financial Strength Rating Local Currency A+/Watch Neg/-- AA-/Watch Neg/-- * Some operating companies have 'A-1' short-term ratings. Lincoln National Corp. To From -- ---- Counterparty Credit Rating Local Currency A-/Stable/A-2 A+/Negative/A-1 Lincoln Nation Corp.'s Core Insurance Operating Companies To From -- ---- Counterparty Credit Rating Local Currency AA-/Stable/-- AA/Stable/-- Financial Strength Rating Local Currency AA-/Stable/-- AA/Stable/-- MetLife Inc. To From -- ---- Counterparty Credit Rating Local Currency A-/Negative/A-2 A/Stable/A-1 MetLife Inc.'s Core Insurance Operating Companies* To From -- ---- Counterparty Credit Rating Local Currency AA-/Negative/-- AA/Stable/-- Financial Strength Rating Local Currency AA-/Negative/-- AA/Stable/-- * Some operating companies have 'A-1+' short-term ratings. Midland National Life Insurance Co. North American Co. for Life & Health Insurance To From -- ---- Counterparty Credit Rating Local Currency A+/Stable/-- AA- /Negative/-- Financial Strength Rating Local Currency A+/Stable/-- AA- /Negative/-- Pacific LifeCorp To From -- ---- Counterparty Credit Rating Local Currency A-/Negative/-- A/Stable/-- Pacific LifeCorp's Core Insurance Operating Companies To From -- ---- Counterparty Credit Rating Local Currency AA-/Negative/-- AA/Stable/-- Financial Strength Rating Local Currency AA-/Negative/-- AA/Stable/-- Protective Life Corp. To From -- ---- Counterparty Credit Rating Local Currency A-/Stable/-- A/Stable/-- Protective Life Corp.'s Core Insurance Operating Companies To From -- ---- Counterparty Credit Rating Local Currency AA-/Stable/-- AA/Stable/-- Financial Strength Rating Local Currency AA-/Stable/-- AA/Stable/-- Prudential Financial Inc. To From -- ---- Counterparty Credit Rating Local Currency A/Stable/A-1 A/Negative/A-1 Prudential Financial Inc.'s Core Operating Companies* To From -- ---- Counterparty Credit Rating Local Currency AA-/Stable/-- AA/Negative/-- Financial Strength Rating Local Currency AA-/Stable/-- AA/Negative/-- * Some operating companies have 'A-1+' short-term ratings. Security Mutual Life Insurance Co. of NY To From -- ---- Counterparty Credit Rating Local Currency A-/Negative/-- A+/Negative/-- Financial Strength Rating Local Currency A-/Negative/-- A+/Negative/-- Symetra Financial Corp. To From -- ---- Counterparty Credit Rating Local Currency BBB/Negative/-- BBB/Stable/-- Symetra Financial Corp.'s Core Operating Companies* To From -- ---- Counterparty Credit Rating Local Currency A/Negative/-- A/Stable/-- Financial Strength Rating Local Currency A/Negative/-- A/Stable/-- Ratings Affirmed Ohio National Financial Services Inc. Counterparty Credit Rating Local Currency A/Stable/-- Ohio National Financial Services Inc.'s Core Operating Companies Counterparty Credit Rating Local Currency AA/Stable/-- Financial Strength Rating Local Currency AA/Stable/-- OneAmerica Financial Partners Inc. Counterparty Credit Rating Local Currency A-/Stable/-- American United Life Insurance Co. Counterparty Credit Rating Local Currency AA-/Stable/-- Financial Strength Rating Local Currency AA-/Stable/-- State Life Insurance Co. Financial Strength Rating Local Currency AA-/Stable/-- Other Recent Rating Actions Because Of Related Issues AEGON N.V. To From -- ---- Counterparty Credit Rating Local Currency A+/WatchNeg/A-1 A+/Negative/A-1 AEGON N.V.'s Core Insurance Operating Companies* To From -- ---- Counterparty Credit Rating Local Currency AA/WatchNeg/-- AA/Negative/-- Financial Strength Rating Local Currency AA/WatchNeg/-- AA/Negative/-- * Some operating companies have 'A-1+' short-term ratings. AFLAC Inc. To From -- ---- Counterparty Credit Rating Local Currency A-/WatchNeg/-- A/Stable/-- AFLAC Inc.'s Core Insurance Operating Companies To From -- ---- Counterparty Credit Rating Local Currency AA-/WatchNeg/-- AA/Stable/-- Financial Strength Rating Local Currency AA-/WatchNeg/-- AA/Stable/-- AXA Financial Inc To From -- ---- Counterparty Credit Rating Local Currency A+/Negative/-- A+/Stable/-- AXA's Core Insurance Operating Companies* To From -- ---- Counterparty Credit Rating Local Currency AA/Negative/- AA/Stable/-- Financial Strength Rating Local Currency AA/Negative/- AA/Stable/-- * Some operating companies have 'A-1+' short-term ratings. FBL Financial Group Inc. To From -- ---- Counterparty Credit Rating Local Currency BBB-/Negative/-- BBB/WatchNeg/-- FBL Financial Group Inc.'s Core Insurance Operating Companies To From -- ---- Counterparty Credit Rating Local Currency A-/Negative/-- A/WatchNeg/-- Financial Strength Rating Local Currency A-/Negative/-- A/WatchNeg/-- Manulife Financial To From -- ---- Counterparty Credit Rating Local Currency AA-/Stable/-- AA/Negative/-- Manulife Core Insurance Operating Companies To From -- ---- Counterparty Credit Rating Local Currency AA+/Stable/-- AAA/Negative/-- Financial Strength Rating Local Currency AA+/Stable/-- AAA/Negative/-- Phoenix Cos. Inc. To From -- ---- Counterparty Credit Rating Local Currency BB+/WatchNeg/-- BB+/Negative/-- Phoenix Cos. Inc.'s Core Insurance Operating Companies To From -- ---- Counterparty Credit Rating Local Currency BBB+/WatchNeg/-- BBB+/Negative/-- Financial Strength Rating Local Currency BBB+/WatchNeg/-- BBB+/Negative/-- Principal Financial Group Inc. To From -- ---- Counterparty Credit Rating Local Currency A-/Negative/-- A/WatchNeg/-- Principal Life Insurance Co.'s Core Insurance Operating Companies* To From -- ---- Counterparty Credit Rating Local Currency AA-/Negative/-- AA/WatchNeg/-- Financial Strength Rating Local Currency AA-/Negative/-- AA/WatchNeg/-- * Some operating companies have 'A-1+' short-term ratings. Security Benefit Life Insurance Co. To From -- ---- Counterparty Credit Rating Local Currency BB/Negative/-- BBB+/Negative/-- Financial Strength Rating Local Currency BB/Negative/-- BBB+/Negative/-- SunLife Financial To From -- ---- Counterparty Credit Rating Local Currency AA-/Watch Neg/A-1+ AA- /Stable/A-1+ Sun Life's Core Insurance Operating Companies* To From -- ---- Counterparty Credit Rating Local Currency AA+/WatchNeg/-- AA+/Stable/-- Financial Strength Rating Local Currency AA+/WatchNeg/-- AA+/Stable/-- * Some operating companies have 'A-1+' short-term ratings. DANA CORP: Bank Loan Continues Slide; Trades at Near 70% Discount ----------------------------------------------------------------- Participations in a syndicated loan under which Dana Corporation is a borrower traded in the secondary market at 30.43 cents-on- the-dollar during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. This represents a drop of 2.97 percentage points -- at 33.40 cents-on-the-dollar -- from the previous week, the Journal relates. The loan matures January 31, 2015. Dana pays 375 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B3 rating and Standard & Poor's B+ rating. Syndicated loans of other auto parts makers also slid in secondary market trading during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. Investors avoided TRW Automotive and Visteon Corp. bank debt. Participations in a syndicated loan under which TRW Automotive is a borrower traded in the secondary market at 57.20 cents-on-the- dollar, a drop of 7.13 percentage points -- at 64.33 cents-on-the- dollar -- from the previous week. TRW Automotive pays 150 basis points to borrow under the facility. The bank loan carries Moody's Ba1 rating and Standard & Poor's BBB- rating. Visteon Corp. bank debt continued its slide, trading in the secondary market at 17.71 cents-on-the-dollar during the week ended February 27, 2009. This represents a drop of 2.50 percentage points -- at 20.21 cents-on-the-dollar -- from the previous week. The loan matures May 30, 2013. Visteon pays 300 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B3 rating and Standard & Poor's B- rating. Participations in a syndicated loan under which Lear Corp. is a borrower traded in the secondary market at 34.57 cents-on-the- dollar. This represents a drop of 3.99 percentage points -- at 38.56 cents-on-the-dollar -- from the previous week. The loan matures March 29, 2012. Lear pays 250 basis points above LIBOR to borrow under the facility. The bank loan is not rated. Syndicated loan of Avis Budget Car Rental LLC traded in the secondary market at 37.80 cents-on-the-dollar, a drop of 3.92 percentage points from the previous week. The loan matures April 1, 2012. Avis Budget pays 125 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's Ba3 rating and Standard & Poor's B rating. Hertz Corporation bank debt traded in the secondary market at 65.85 cents-on-the-dollar, a decrease of 2.37 percentage points from the previous week. The loan matures on December 21, 2012. Hertz pays 150 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's Ba1 rating and Standard & Poor's BB+ rating. About Dana Holding Corporation Based in Toledo, Ohio, Dana Corporation -- http://www.dana.com/ -- designs and manufactures products for every major vehicle producer in the world, and supplies drivetrain, chassis, structural, and engine technologies to those companies. Dana employs 46,000 people in 28 countries. Dana is focused on being an essential partner to automotive, commercial, and off-highway vehicle customers, which collectively produce more than 60 million vehicles annually. Dana has facilities in China in the Asia-Pacific, Argentina in the Latin-American regions and Italy in Europe. The company and its affiliates filed for chapter 11 protection on March 3, 2006 (Bankr. S.D.N.Y. Case No. 06-10354). As of Nov. 30, 2007, the Debtors listed $7,131,000,000 in total assets and $7,665,000,000 in total debts resulting in a shareholders' deficit of $534,000,000. Corinne Ball, Esq., and Richard H. Engman, Esq., at Jones Day, in Manhattan and Heather Lennox, Esq., Jeffrey B. Ellman, Esq., Carl E. Black, Esq., and Ryan T. Routh, Esq., at Jones Day in Cleveland, Ohio, represented the Debtors. Henry S. Miller at Miller Buckfire & Co., LLC, served as the Debtors' financial advisor and investment banker. Ted Stenger from AlixPartners served as Dana's Chief Restructuring Officer. Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel LLP, represented the Official Committee of Unsecured Creditors. Fried, Frank, Harris, Shriver & Jacobson, LLP served as counsel to the Official Committee of Equity Security Holders. Stahl Cowen Crowley, LLC served as counsel to the Official Committee of Non-Union Retirees. The Debtors filed their Joint Plan of Reorganization on Aug. 31, 2007. On Oct. 23, 2007, the Court approved the adequacy of the Disclosure Statement explaining their Plan. Judge Burton Lifland of the U.S. Bankruptcy Court for the Southern District of New York entered an order confirming the Third Amended Joint Plan of Reorganization of the Debtors on Dec. 26, 2007. The Debtors' Third Amended Joint Plan of Reorganization was deemed effective as of Jan. 31, 2008. Dana Corp., starting on the Plan Effective Date, operated as Dana Holding Corporation. (Dana Corporation Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) * * * As reported by the TCR on Jan. 15, 2009, Standard & Poor's Ratings Services lowered its ratings on Dana Holding Corp., including the corporate credit rating, which was lowered to 'B' from 'B+'. The ratings were also removed from CreditWatch, where they had been placed with negative implications on Nov. 13, 2008. The outlook is negative. "The downgrade reflects our view that very weak market conditions in most of its business segments in 2009 will hinder the company's post-bankruptcy restructuring efforts," said Standard & Poor's credit analyst Nancy Messer. "We expect revenues to be reduced by weak auto sales and production in North America, weak auto sales in Europe, and the U.S. recession, which has stalled the recovery of commercial truck sales. Lacking an expanding revenue base, S&P believes the benefit from Dana's ongoing initiative to optimize its manufacturing footprint will fall short of S&P's previous near-term expectations," she continued. For example, for the last three months of 2008, the seasonally adjusted annual rate of light-vehicle sales in the U.S. was below 11 million units, and S&P expects sales in 2009 to be 10 million units, 24% below 2008 actual sales. DELPHI CORP: GM Not Sure on Former Unit's Ability to Get Exit Loan ------------------------------------------------------------------ In its viability plan submitted to the Treasury on February 17, General Motors Corp. included the outcome of Delphi's bankruptcy proceedings among "key risks [that] threaten full implementation and require close attention [of the plan]". The U.S. Treasury and U.S. President Barack Obama's automotive task force are currently reviewing the Plan, which requires an additional $16.6 billion on top of $13.4 billion already loaned by the government to GM. The Viability Plan includes near-term liquidity support and other commitments to its former unit, Delphi, based on current agreements between the parties. In addition, GM said that its plan contemplates the purchase of certain sites from Delphi that represent an important source of supply for GM and potential incremental liquidity support as part of reaching an agreement with Delphi on this purchase. According to GM, Delphi is also seeking to address its underfunded pension plans and to secure exit financing to successfully emerge from bankruptcy. GM said that based on current agreements with Delphi, it is required to absorb the remaining hourly pension plan only under certain conditions, which are not currently expected to be met. GM, however, noted that that it has no obligation to absorb Delphi`s salaried pension plan. "As such, the Federal loan support outlined in the Company's revised Plan does not contemplate the transfer of either the hourly or salaried pension plans to GM. Delphi is unlikely to be able to support these underfunded pension plans going forward and may need to terminate these plans, which would impact the PBGC." In addition, a portion of Delphi's exit funding needs would be satisfied through the proceeds stemming from the sale of sites to GM, the automaker said. "However, given current capital market environments, it is uncertain whether Delphi will be able to raise the balance of the funding necessary to exit bankruptcy. If Delphi is unsuccessful in addressing its underfunded pension plans and raising exit financing, it would represent a significant risk to its revised Plan, GM said. "In this event, the Company would consider alternative strategies, including utilizing other sources of supply, albeit requiring some lead time to accomplish." Delphi's April 2 Deadline to File Plan Delphi filed for bankruptcy protection in October 2005, filed its proposed plan of reorganization in September 2007, and obtained confirmation of the amended version of that Plan in January 2008. The Plan, however, was not consummated after a group led by Appaloosa Management, L.P., backed out from their proposal to provide $2,550,000,000 in equity financing to Delphi. Delphi, on October 3, filed a modified Plan that did not require funding by Appaloosa, but required more support from General Motors. Delphi, however, failed to move forward with that plan after failing to arrange adequate exit debt financing. Delphi had obtained extensions of the maturity date of its $4.35-billion debtor-in-possession financing due to delays in its exit from bankruptcy. When the DIP facility couldn't be extended past December 31, Delphi reached an accommodation agreement with lenders under its two most senior tranches of its three-tier DIP facility. The lenders, which have allowed Delphi to retain drawn proceeds from the loan despite the expiration of the DIP facility in December 2008, have required Delphi to submit a reorganization plan by April 2, 2009. Delphi is required to obtain Court approval of the disclosure statement to the April 2 plan not later than May 2, 2009. The Accommodation Agreement expires June 30, 2009, but could be terminated earlier, on May 5, 2009, if the milestones are not achieved. About General Motors Headquartered in Detroit, Michigan, General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- was founded in 1908. GM employs about 266,000 people around the world and manufactures cars and trucks in 35 countries. In 2007, nearly 9.37 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. General Motors Latin America, Africa and Middle East, with headquarters in Miramar, Florida, is one of GM's four regional business units. GM LAAM employs approximately 37,000 people in 18 countries and has manufacturing facilities in Argentina, Brazil, Colombia, Ecuador, Egypt, Kenya, South Africa and Venezuela. GM LAAM markets vehicles under the Buick, Cadillac, Chevrolet, GMC, Hummer, Isuzu, Opel, Saab and Suzuki brands. As reported in the Troubled Company Reporter on Nov. 10, 2008, General Motors Corporation's balance sheet at Sept. 30, 2008, showed total assets of US$110.425 billion, total liabilities of US$170.3 billion, resulting in a stockholders' deficit of US$59.9 billion. * * * As reported in the Troubled Company Reporter on Nov. 11, 2008, Standard & Poor's Ratings Services lowered its ratings, including the corporate credit rating, on General Motors Corp. to 'CCC+' from 'B-' and removed them from CreditWatch, where they had been placed with negative implications on Oct. 9, 2008. S&P said that the outlook is negative. Fitch Ratings, as reported in the Troubled Company Reporter on Nov. 11, 2008, placed the Issuer Default Rating of General Motors on Rating Watch Negative as a result of the company's rapidly diminishing liquidity position. Given the current liquidity level of US$16.2 billion and the pace of negative cash flows, Fitch expects that GM will require direct federal assistance over the next quarter and the forbearance of trade creditors in order to avoid default. With virtually no further access to external capital and little potential for material asset sales, cash holdings are expected to shortly reach minimum required operating levels. Fitch placed these on Rating Watch Negative: -- Senior secured at 'B/RR1'; -- Senior unsecured at 'CCC-/RR5'. As reported in the Troubled Company Reporter on June 24, 2008, DBRS has placed the ratings of General Motors Corp. and General Motors of Canada Limited Under Review with Negative Implications. The rating action reflects the structural deterioration of the company's operations in North America brought on by high oil prices and a slowing U.S. Economy. About Delphi Corp. Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ) -- http://www.delphi.com/-- is the single supplier of vehicle electronics, transportation components, integrated systems and modules, and other electronic technology. The company's technology and products are present in more than 75 million vehicles on the road worldwide. Delphi has regional headquarters in Japan, Brazil and France. The company filed for Chapter 11 protection on Oct. 8, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP, represent the Official Committee of Unsecured Creditors. As of June 30, 2008, the Debtors' balance sheet showed US$9,162,000,000 in total assets and US$23,742,000,000 in total debts. The Court approved Delphi's First Amended Joint Disclosure Statement and related solicitation procedures for the solicitation of votes on the First Amended Plan on Dec. 20, 2007. The Court confirmed the Debtors' First Amended Plan on Jan. 25, 2008. The Plan has not been consummated after a group led by Appaloosa Management, L.P., backed out from their proposal to provide US$2,550,000,000 in equity financing to Delphi. Delphi, on October 3, filed modifications to their Plan of Reorganization, which did not require funding by Appaloosa, but required more support from General Motors. Delphi, however, failed to move forward with that plan after failing to arrange exit debt financing. Delphi has reached an accommodation agreement with certain lenders of its $4.35-billion debtor-in-possession financing. The lenders, which have allowed Delphi to retain drawn proceeds despite the expiration of the DIP facility in December 2008, have required Delphi to submit a reorganization plan by April 2, 2009. (Delphi Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) DELPHI CORP: Gets SEC Nod to Seal Some Terms of GM MRA Until 2015 ----------------------------------------------------------------- Delphi Corp. obtained approval from the Securities and Exchange Commission of its request for confidential treatment of information it excluded from an exhibit to its third quarter 2008 results on Form 10-Q that it filed on November 10, 2008. Based on representations by Delphi that the excluded items from the exhibit qualifies as confidential commercial or financial information under the Freedom of Information Act, 5 U.S.C. 552(b)(4), the SEC's Division of Corporation Finance has determined not to publicly disclose them. The SEC's order said that the excluded information from "Exhibit 10(f)" will not be released through December 31, 2015. The Exhibit 10(f) is a copy of the Amended and Restated Master Restructuring Agreement dated September 12, 2008, between Delphi and its former parent General Motors Corp. The MRA is one of two comprehensive settlement agreements reached with GM that Delphi filed together with its proposed plan of reorganization, the original version of which was filed in September 2007. The MRA governs certain aspects of Delphi and GM's commercial relationship following Delphi's emergence from Chapter 11. The MRA addresses, among other things, the scope of GM's existing and future business awards to Delphi and related pricing agreements and sourcing arrangements, GM commitments with respect to reimbursement of specified ongoing labor costs, the disposition of certain Delphi facilities, and the treatment of existing agreements between Delphi and GM. The other agreement, the Global Settlement Agreement, resolves outstanding issues among Delphi and GM that have arisen or may arise before Delphi's emergence from Chapter 11, including, commitments regarding OPEB and pension obligations, other GM contributions with respect to labor matters, releases, and claims treatment. In September 2008, due to delays in implementing its Bankruptcy Court-confirmed plan of reorganization, Delphi sought amendments to the GSA and MRA to authorized those agreements to be effective independent of and in advance of the effective date of the company's POR. At the time it sought the amendments, Delphi said it will receive support from GM valued at $10.6 billion. Items from the MRA that were omitted because they were confidential include: * The terms of an access agreement which (i) grants GM, under certain circumstances, access to Delphi's facilities, and (ii) takes effect after Delphi's emergence from bankruptcy (the omitted items include the period of the agreement and the events that would trigger right of access); * The net separation costs ($75 million less the amounts the buyer agrees to pay) incurred by Delphi as a result of the sale of its global interiors businesses, global steering business and Sandusky business, * Outstanding GM purchase orders, and recently awarded business by GM to Delphi, * A four-page spreadsheet on contract extensions, * Changes in manufacturing location in respect of various product lines, * Form of monthly invoice for the aggregate amount of the applicable cash burn percentage of production cash burn incurred at all "support facilities." The table provides for certain reimbursement amounts for the cash burn, which is defined as the sum specified cash expenditures by Delphi less net sales at each support facility. A portion in the MRA provides that for the purposes of determining Production Cash Burn, overhead will be deemed to be a fixed 2.25% of net sales for all Support Facilities except for the Flint East Facility, the Sandusky Facility, the Saginaw Steering Facility, the Adrian Facility, and the Athens Facility where overhead will be deemed to be 5.0% of net sales. * Letter from Bill Hurles, of GM, to Jeff Paprocki, of Delphi, dated February 1, 2007, under which both parties have agreed to work together to minimize excess and obsolete materials with respect to the Support Facilities, and * the GM intellectual property proposal. A copy of the MRA on Exhibit 10(f) is available at: http://researcharchives.com/t/s?39f5 About Delphi Corp. Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ) -- http://www.delphi.com/-- is the single supplier of vehicle electronics, transportation components, integrated systems and modules, and other electronic technology. The company's technology and products are present in more than 75 million vehicles on the road worldwide. Delphi has regional headquarters in Japan, Brazil and France. The company filed for Chapter 11 protection on Oct. 8, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP, represent the Official Committee of Unsecured Creditors. As of June 30, 2008, the Debtors' balance sheet showed US$9,162,000,000 in total assets and US$23,742,000,000 in total debts. The Court approved Delphi's First Amended Joint Disclosure Statement and related solicitation procedures for the solicitation of votes on the First Amended Plan on Dec. 20, 2007. The Court confirmed the Debtors' First Amended Plan on Jan. 25, 2008. The Plan has not been consummated after a group led by Appaloosa Management, L.P., backed out from their proposal to provide US$2,550,000,000 in equity financing to Delphi. Delphi, on October 3, filed modifications to their Plan of Reorganization, which did not require funding by Appaloosa, but required more support from General Motors. Delphi, however, failed to move forward with that plan after failing to arrange exit debt financing. Delphi has reached an accommodation agreement with certain lenders of its $4.35-billion debtor-in-possession financing. The lenders, which have allowed Delphi to retain drawn proceeds despite the expiration of the DIP facility in December 2008, have required Delphi to submit a reorganization plan by April 2, 2009. (Delphi Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) About General Motors Headquartered in Detroit, Michigan, General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- was founded in 1908. GM employs about 266,000 people around the world and manufactures cars and trucks in 35 countries. In 2007, nearly 9.37 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. General Motors Latin America, Africa and Middle East, with headquarters in Miramar, Florida, is one of GM's four regional business units. GM LAAM employs approximately 37,000 people in 18 countries and has manufacturing facilities in Argentina, Brazil, Colombia, Ecuador, Egypt, Kenya, South Africa and Venezuela. GM LAAM markets vehicles under the Buick, Cadillac, Chevrolet, GMC, Hummer, Isuzu, Opel, Saab and Suzuki brands. As reported in the Troubled Company Reporter on Nov. 10, 2008, General Motors Corporation's balance sheet at Sept. 30, 2008, showed total assets of US$110.425 billion, total liabilities of US$170.3 billion, resulting in a stockholders' deficit of US$59.9 billion. * * * As reported in the Troubled Company Reporter on Nov. 11, 2008, Standard & Poor's Ratings Services lowered its ratings, including the corporate credit rating, on General Motors Corp. to 'CCC+' from 'B-' and removed them from CreditWatch, where they had been placed with negative implications on Oct. 9, 2008. S&P said that the outlook is negative. Fitch Ratings, as reported in the Troubled Company Reporter on Nov. 11, 2008, placed the Issuer Default Rating of General Motors on Rating Watch Negative as a result of the company's rapidly diminishing liquidity position. Given the current liquidity level of US$16.2 billion and the pace of negative cash flows, Fitch expects that GM will require direct federal assistance over the next quarter and the forbearance of trade creditors in order to avoid default. With virtually no further access to external capital and little potential for material asset sales, cash holdings are expected to shortly reach minimum required operating levels. Fitch placed these on Rating Watch Negative: -- Senior secured at 'B/RR1'; -- Senior unsecured at 'CCC-/RR5'. As reported in the Troubled Company Reporter on June 24, 2008, DBRS has placed the ratings of General Motors Corp. and General Motors of Canada Limited Under Review with Negative Implications. The rating action reflects the structural deterioration of the company's operations in North America brought on by high oil prices and a slowing U.S. Economy. DOLLAR THRIFTY: S&P Retains Negative CreditWatch on 'CCC+' Rating ----------------------------------------------------------------- Standard & Poor's Ratings Services said its ratings on Dollar Thrifty Automotive Group Inc., including the 'CCC+' long-term corporate credit rating, remain on CreditWatch with negative implications. Ratings were originally placed on CreditWatch on Feb. 12, 2008, and lowered to current levels on Dec. 22, 2008. "The CreditWatch update follows Dollar Thrifty's announcement yesterday that it has amended its corporate credit facility and fleet financing agreements," said Standard & Poor's credit analyst Betsy R. Snyder. Under the corporate credit facility, the auto rental company will no longer be required to maintain a minimum leverage ratio, although it must maintain a minimum adjusted tangible net worth of $150 million and a minimum of $100 million of unrestricted cash and cash equivalents. At Dec. 31, 2008, the company had approximately $215 million of adjusted tangible net worth and approximately $230 million of unrestricted cash and cash equivalents. In addition to the covenant amendments, the company prepaid $20 million of the term loan and permanently reduced its revolving credit facility to $231 million from the initial $350 million. S&P lowered its corporate credit rating on Dollar Thrifty to 'CCC+' from 'B-' on Dec. 22, 2008, and maintained the ratings on CreditWatch with negative implications. S&P based those rating actions on the company's exposure to the distressed U.S. auto manufacturers, particularly Chrysler LLC; the need for longer-term covenant relief on its corporate credit facility; and a continuing weak earnings outlook, due to pressure on demand, pricing, and vehicle residual values. While the company was successful in amending its covenants through the 2013 maturity of the revolving credit facility and 2014 maturity of the term loan, it still faces the other issues. Tulsa, Oklahoma- based Dollar Thrifty, the parent of the Dollar and Thrifty car rental brands, currently has around 11% of the U.S. on-airport car rental market, significantly smaller than the approximate 30% share of each of its major competitors Hertz Corp., Avis Budget Group Inc. (parent of the Avis and Budget brands), and Enterprise Rent-A-Car Co. (parent of the Enterprise, Alamo and National brands). Dollar Thrifty derives most of its revenues from leisure travelers, who are more likely to reduce their travel plans because of economic weakness. S&P will assess the effect of the weak economy and the distressed auto manufacturers, particularly Chrysler, to resolve the CreditWatch. DOUBLEDOWN MEDIA: Wall Street Magazine Files to Liquidate --------------------------------------------------------- Doubledown Media LLC, publisher of magazines for Wall Street bankers and traders didn't even attempt to reorganize, filing for Chapter 7 liquidation instead. The Company, which publishes Trader Monthly, Dealmaker, Private Air, Corporate Leader and Cigar Report, filed its Chapter 7 petition on February 25 before the U.S. Bankruptcy Court for the Southern District of New York, Bloomberg News said. Reuters obtained a memo on February 3, citing that the Company ceased operations after a key financial backer withdrew financing. Randall Lane, Doubledown's president, in the memo, cited a 'depression' for media companies, Wall Street upheaval, and tighter credit for the decision to close. According to Reuters, the financial press is struggling with falling advertising revenue, especially at publications that cater to rich professionals whose job stability and income streams are under increasing attack. In its bankruptcy petition, Doubledown estimated assets and debt both exceeding $10 million. DREIER LLP: Bar Date for Pre-Bankruptcy Claims Set for March 31 --------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York has established March 31, 2009, as the last date for each person or entity (including individuals, partnerships, corporations, joint ventures and trusts) to file a proof of claim in Dreier LLP's Chapter 11 bankruptcy case. A person or entity who has a claim against the Debtor that arose prior to Dec. 16, 2008, must file a proof of claim, whether by mail, hand delivery or overnight courier to the: United States Bankruptcy Court Southern District of New York One Bowling Green, Room 534 New York, New York 10004-1408 Governmental units have until June 14, 2009, to file proofs of claim. New York-based law firm Dreier LLP -- http://www.dreierllp.com/-- was founded by Marc S. Dreier in 1996. On Dec. 8, 2008, the U.S. Securities and Exchange Commission filed a suit, alleging that Mr. Dreier made fraudulent offers and sales of securities in several cities, selling fake promissory notes to hedge and other private investment funds. The SEC asserted that Mr. Dreier also distributed phony financial statements and audit opinions, and recruited accomplices in connection with that scheme. Mr. Dreier has been charged by the U.S. government for conspiracy, securities fraud and wire fraud before the U.S. District Court for the Southern District of New York (Manhattan) (Case No. 09-cr-00085- JSR). Dreier LLP filed for Chapter 11 on Dec. 16, 2008 (Bankr. S. D. N.Y., Case No. 08-15051). Judge Robert E. Gerber handles the case. Stephen J. Shimshak, Esq., at Paul, Weiss, Rifkind, Wharton & Garrison LLP, has been retained as counsel. The Debtor listed assets between $100 million and $500 million, and debts between $10 million and $50 million in its filing. Wachovia Bank National Association, Sheila M. Gowan as trustee for Chapter 11 estate of Dreier LLP, and Steven J. Reisman as postconfirmation representative of the bankruptcy estate of 360networks (USA) Inc. signed a petition that sent Mr. Dreier to bankruptcy under Chapter 7 on Jan. 26, 2009 (Bankr. S.D. N.Y., Case No. 09-10371). DRYSHIPS INC: Pens Final Pact With Nordea for Covenant Waiver ------------------------------------------------------------- Dryships Inc. reached final agreement and received formal approval from Nordea Bank Finland Plc, DnB NOR Bank ASA and HSH Nordbank AG regarding a covenant waiver in connection with the $800 million Primelead facility. George Economou, Chairman and Chief Executive Officer, commented: "We are delighted to have reached a definitive agreement with the three lenders on the Primelead facility. This agreement is a testament of the support of Nordea Bank Finland Plc, DnB NOR Bank ASA and HSH Nordbank AG to DryShips. These three lenders acting as agents or direct lenders represent 75% of the total loans outstanding of the Company." As reported by the Troubled Company Reporter on February 10, 2009, DryShips reached preliminary agreement with Nordea Bank Finland Plc to obtain a covenant waiver in connection with the $800.0 million Primelead facility, which was used to partially finance the acquisition of Ocean Rig ASA. The outstanding loan amount under the facility is $650.0 million. In accordance with the main terms of the waiver: (i) the Company will pay a restructuring fee of 0.15% on the outstanding loan amount under the facility plus an amount equal to 1.00% per annum on the loan outstanding for the period from January 9, 2009 until the Effective Date of the waiver agreement; (ii) $75.0 million of principal repayment due February 2009 will be postponed until May 2009; (iii) the margin on the facility will increase by 1.00% to 3.125% per annum; and (iv) regular principal payments will resume as of August 2009. In addition, among other things, lender consent will be required for the acquisition of DrillShip Hulls 1837 and 1838, for new cash capital expenditures or commitments and for new acquisitions for cash until the loan has been repaid to below $375.0 million. The waiver agreement Effective Date will not exceed August 12, 2009, at which time the Company expects to be in compliance with the restructured loan covenants. The agreement is preliminary and is subject to formal approvals by the Company and the syndicate banks (Nordea Bank Finland Plc, DnB NOR Bank ASA and HSH Nordbank AG). About DryShips Inc. DryShips Inc. (DRYS) -- http://www.dryships.com-- based in Greece, owns and operates drybulk carriers that operate worldwide. DryShips owns a fleet of 43 drybulk carriers comprising 7 Capesize, 29 Panamax, 2 Supramax and 5 newbuilding drybulk vessels with a combined deadweight tonnage of over 3.4 million tons, 2 ultra deep water semisubmersible drilling rigs and 2 ultra deep water newbuilding drillships. DryShips Inc.'s common stock is listed on the NASDAQ Global Market where trades under the symbol "DRYS." DYNOGEN PHARMACEUTICALS: Sends Business to Chapter 7 Liquidation ---------------------------------------------------------------- Dynogen Pharmaceuticals Inc. filed for Chapter 7 before the U.S. Bankruptcy Court for the District of Massachusetts. Filing for Chapter 7 gives control of the Company to a Chapter 7 trustee who will liquidate the assets. A Chapter 11 filing would have allowed management to retain control to restructure the Company's balance sheet, and device a plan to keep operations after bankruptcy. According to Bloomberg's Bill Rochelle, in April Apex Bioventures Acquisition Corp. withdrew an offer to acquire Dynogen. Waltham, Massachusetts-based Dynogen Pharmaceuticals Inc. develops a drug for irritable bowel syndrome. In its bankruptcy petition, it estimated assets of less than $10 million and debt exceeding $10 million. ECLIPSE AVIATION: Suspends Operations, Lays Off Workers ------------------------------------------------------- Kevin Robinson-Avila at The Business Review reports that Eclipse Aviation Corp. said that it has suspended its business operations and expects the U.S. Bankruptcy Court for the District of Delaware to promptly appoint a trustee to supervise the liquidation of its assets. As reported by the Troubled Company Reporter on February 27, 2009, Eclipse Aviation said that it wouldn't object a motion filed by senior noteholders to convert the company's Chapter 11 reorganization case to Chapter 7 liquidation. The noteholders, who want "effective control" of Eclipse's assets, decided to seek for the liquidation of Eclipse Aviation. Their decision shows that the company has failed to complete its planned $188 million sale to EclipseJet Aviation. Court documents say that the Ad Hoc committee representing the senior secured creditors -- consisting of Kings Road Investments Ltd., HBK Services LLC, and Citadel Investment Group LLC -- said that "there is no reasonable likelihood of rehabilitation" through the Chapter 11 proceeding because Eclipse Aviation and its debtors are administratively insolvent and the sale of debtors' assets to EclipseJet hadn't closed because that company could not obtain the requisite financing. According to court documents, the committee said that "after the delays EclipseJet has experienced in obtaining financing over the past month, the Ad Hoc Committee is convinced that it will not succeed in the near term. The Debtors can no longer wait: they are now literally out of cash." According to The Business Review, Eclipse had furloughed its remaining 800 workers -- including 24 at Albany International Airport -- on February 18, due to delays in financing talks. Eclipse had said at that time that it was a temporary move and that it expected the deal to close and employees to return to work. The Business Review relates that on February 24, Eclipse executives said in a letter to workers that the company decided to lay off the affected workers, effective as of February 19. No salaries would be forthcoming for paychecks due on March 5 and benefits would end as of February 28, according to the report. Citing New Mexico Gov. Bill Richardson's office, The Business Review relates that more than half of the laid off workers have already filed for benefits. 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. ELITE LANDINGS: Court Extends Plan Filing Period to June 6, 2009 ---------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Minnesota extended Elite Landings, LLC's exclusive period to propose a plan through and including June 6, 2009. The Debtor's exclusive period to solicit acceptances of a plan was extended to Aug. 5, 2009. In its motion, the Debtor told the Court that due to the seizure of records belonging to both Thomas J. Petters, personally and entities associated with him in connection with the pending criminal proceedings, as well as the convoluted and interrelated nature of all of the entities associated with Thomas J. Petters, Petters Aviation and Elite require additional time in order to investigate the validity of the obligations claimed to be owed to other Petters entities, as well as to whether the transfers from Elite and Petters Aviation to those entities may be recoverable. In addition, Elite, who is the debtor-in-possession lender to Sun Country Airlines, told the Court that formulation of any plan will need to await resolution of its loan to Sun Country Airlines. Further, the Debtor informed the Court that it has not been able to assemble the information necessary for it to file a plan of reorganization. About Elite Landings Based in Minnetonka, Minnesota, Elite Landings, LLC was, prior to filing for bankruptcy, engaged in the business of purchasing Airbus Corporate Jet Aircraft from Airbus S.A.S. and reselling them. The company filed for Chapter 11 relief on Oct. 9, 2008 (Bankr. D. Minn. Case No. 08-45210). James A. Rubenstein, Esq., at Moss & Barnett, represents the Debtor as counsel. The company listed total assets of between $10 million and $50 million, and the same range in total debts. The company is a wholly owned subsidiary of Petters Aviation. Petters Aviation is a wholly owned subsidiary of Thomas Petters, Inc., which is in turn owned 100% by Thomas J. Petters, individually. Thomas Petters, the founder and former CEO of Petters Group, remains in federal custody on charges of mail and wire fraud, money laundering and obstruction of justice. About Petters Group Worldwide Based in Minnetonka, Minn., Petters Group Worldwide LLC is named for founder and chairman Tom Petters. The group is a collection of some 20 companies, most of which make and market consumer products. It also works with existing brands through licensing agreements to further extend those brands into new product lines and markets. Holdings include Fingerhut (consumer products via its catalog and Web site), SoniqCast (maker of portable, WiFi MP3 devices), leading instant film and camera company Polaroid (purchased for $426 million in 2005), Sun Country Airlines (acquired in 2006), and Enable Holdings (online marketplace and auction for consumers and manufacturers' overstock inventory). Petters formed the company in 1988. Petters Company, Inc. is the financing and capital-raising unit of Petters Group Worldwide, LLC. Petters Company, Inc. and Petters Group Worldwide, LLC, filed separate petitions for Chapter 11 relief on Oct. 11, 2008 (Bankr. D. Minn. Case No. 08-45257 and 08- 45258, respectively). James A. Lodoen, Esq., at Lindquist & Vennum P.L.L.P., represents the Debtors as counsel. In its petition, Petters Company, Inc. listed debts of between $500 million and $1 billion, while its parent, Petters Group Worldwide, LLC listed debts of not more than $50,000. As reported in the Troubled Company Reporter on Oct. 7, 2008, Petters Aviation, LLC,, and affiliates MN Airlines, LLC, doing business as Sun Country Airlines, Inc., and MN Airline Holdings, Inc., filed for Chapter 11 bankruptcy protection with the U.S. Bankruptcy Court for the District of Minnesota on Oct. 6, 2008 (Lead Case No. 08-45136). Petters Aviation, LLC is a wholly owned unit of Thomas Petters Inc. and owner of MN Airline Holdings, Inc., Sun Country's parent company. Polaroid Corp., which was owned by Petters since 2005, filed its second voluntary petition for Chapter 11 on Dec. 18, 2008 (Bankr. D. Minn., Lead Case No. 08-46617). EMERSON REINSURANCE: Moody's Withdraws 'Ba2' Rating on C Notes -------------------------------------------------------------- Moody's Investors Service has withdrawn its ratings on the remaining Series A, B and C bank loans of Emerson Reinsurance Limited after the loans were repaid in full as of February 20, 2009. The lenders did not suffer any loss of interest or principal during the life of the transaction. Emerson Re issued four bank loans (Series A, B, C, D) in June 2007 as a way for lenders to provide catastrophe excess-of-loss reinsurance to CIG Reinsurance Limited and New Castle Reinsurance Company Limited (both unrated by Moody's). These ratings have been withdrawn because the loans have been repaid in full: * Emerson Reinsurance Limited -- $130 million senior secured term loan (Series C) at Ba2; * Emerson Reinsurance Limited -- $140 million senior secured term loan (Series B) at Baa3; * Emerson Reinsurance Limited -- $185 million senior secured term loan (Series A) at A2. The last rating action on Emerson Re occurred on February 6, 2009 when Moody's affirmed its ratings on the Series A, B and C loans and withdrew its rating on the Series D loan after it was repaid. ENERGY PARTNERS: Restructuring Prompts S&P's Rating Cut to 'CCC+' ----------------------------------------------------------------- Standard & Poor's Ratings Services said it lowered its corporate credit rating on independent exploration and production firm Energy Partners Ltd. to 'CCC+' from 'B-'. The outlook is negative. At the same time, Standard & Poor's lowered its unsecured ratings on EPL to 'CCC' from 'CCC+'. The recovery ratings on EPL's outstanding unsecured issues remain unchanged at '5'. "The downgrade follows EPL's announcement earlier this week that it would be restructuring its board of directors and has retained Parkman Whaling LLC as its financial advisor to help evaluate strategic alternatives, which could include a potential recapitalization of the company," said Standard & Poor's credit analyst Jeffery Morrison. "We view this announcement as creating greater uncertainty around EPL's strategic direction in the near term." In addition, it is unclear to Standard & Poor's what form a recapitalization could take if EPL chooses to pursue this path of action. Based on the company's February operational update, New Orleans, La.-based EPL had about $497 million of book debt (including $43 million drawn under its senior secured credit facility) as of Dec. 31, 2008. This rating action follows a downgrade of EPL's corporate credit rating to 'B-' from 'B' in January, which highlighted additional concerns for the ratings, including, expectations of tighter liquidity over the near term (due to increased drawings under its senior credit facility) and a substantially weaker cashflow outlook for 2009 because of the precipitous decline in crude and natural gas prices over the past six months. The negative outlook on EPL reflects a lack of clarity surrounding the company's strategic direction, as it has recently retained a financial advisor to evaluate strategic alternatives, and concern over the form a potential recapitalization will take if EPL pursues this course of action. In addition, the outlook factors in a weaker liquidity position as a result of recent hurricane related production disruption, lower crude oil and natural gas prices, and first quarter outlays of $17 million associated with its agreement with the Mineral Management Service. There's also the potential for EPL's borrowing base to be reduced by lenders at its semi annual redetermination in April. S&P expects the company's cashflow from operations will remain under pressure in the near term given continued commodity price weakness. ENERLUME ENERGY: Signs Promissory Note Extension With D. Troiano ---------------------------------------------------------------- On February 12, 2009, EnerLume Energy Management Corp. entered into a promissory note extension agreement with Daniel Troiano to amend the terms of an unsecured convertible promissory note issued to them on July 30, 2008. The Unsecured Note was originally issued for the principal amount of $500,000, accrued interest at the rate of 18% per annum, and was originally due on January 30, 2009. Pursuant to the promissory note extension agreement, the maturity date for the Unsecured Note will be extended to July 30, 2009, and will continue to accrue interest at the rate of 18% per annum in accordance with the original terms of the Unsecured Note. In addition, Mr. Troiano will receive warrants to purchase 310,000 shares of the Company's common stock exercisable until January 31, 2014, at $0.54 per share. Mr. Troiano is a brother to a member of the Company's Board of Directors and that brother did not participate in the Board's decision to extend the notes or the revised terms. Form 10-Q Will Be Late In a separate regulatory filing, the Company disclosed that it won't be able to file its Form 10-Q for the quarter ended December 31, 2008. Chief Financial Officer Michael C. Malota said the compilation, dissemination and review of the information required to be presented in the Form 10-Q for the relevant quarter has imposed time constraints that have rendered timely filing of the Form 10-Q impracticable without undue hardship and expense to the Company. The Company will file the quarterly report very soon. About EnerLume Energy Headquartered in Hamden, Conn., EnerLume Energy Management Corp. (OTC BB: ENLU) -- http://www.enerlume.com/-- through its subsidiaries, provides energy management conservation products and services in the United States. Its focus is energy conservation, which includes a proprietary digital microprocessor for reducing energy consumption on lighting systems, and the installation and design of electrical systems, energy management systems, telecommunication networks, control panels and lighting systems. New York-based Mahoney Cohen & Company, CPA, P.C., raised substantial doubt about the ability of EnerLume Energy Management Corp., formerly Host America Corporation, to continue as a going concern after it audited the company's financial statements for the year ended June 30, 2008. The Company has suffered recurring losses from continuing operations, has negative cash flows from operations, has a working capital and stockholders' deficiency at September 30, 2008 and is currently involved in litigation that can have an adverse effect on the company's operations. These conditions raise substantial doubt about the Company's ability to continue as a going concern. As of September 30, 2008, the Company's balance sheet showed total assets of $1,845,922 and total liabilities of $8,108,242, resulting in total stockholders' deficiency of $6,262,320. For the three months ended September 30, 2008 and 2007, the Company posted net losses of $2,343,865 and $1,140,076. ESTATE FINANCIAL: Trustee Wants to Tap Farella Braun as Counsel --------------------------------------------------------------- Thomas P. Jeremiassen, the chapter 11 trustee appointed for Estate Financial, Inc.'s Chapter 11 case, seeks the authority of the U.S. Bankruptcy Court for the Central District of California to employ Farella Braun & Martel LLP as special counsel for the estate, nunc pro tunc to June 25, 2008, in the pending arbitration before JAMS, JAMS Reference No. 1110010947 (the "Arbitration"), and a civil case pending in the Superior State for the State of California, Santa Clara County, Case No. 1-07-CV-090499, both entitled Alvand Construction v. Republic Properties, Inc. et al. FB&M will render these professional services: a) represent the Trustee in the Alvand Litigation; b) draft a petition to vacate, inclduing drafting undisputed facts and prepare associated declarations; c) reply to any and all oppositions; d) prepare potential witnesses for hering, and e) prepare argument for hearing. FB&M's personnel who are likely to work on the Alvand litigation r bills at $695 per hour and $385 per hour. David K. Ismay, Esq., an associate at FB&M, assures the Court that the firm does not hold or reperesent any interest adverse to the Debtor's estate and that the firm is a "disinterested person" as that term is defined in Sec. 101(14) of the Bankruptcy Code. For services rendered on behalf of the Debtor since June 25, 2008, FB&M is owed (through Jan. 29, 2009), $30,615.76. FB&M shall receive a $10,000 retainer for this representation. About Estate Financial Five creditors of Paso Robles, California-based Estate Financial Inc. -- http://www.estatefinancial.com/-- filed an involuntary Chapter 11 petition against the real estate broker on June 25, 2008 (Bankr. C.D. Calif. Case Number 08-11457). Petitioner Steve Gardality asserted a claim of $6,269,768. Estate Financial Inc. consented to the bankruptcy filing on July 16, 2008. Robert B. Orgel, Esq., at Pachulski Stang Ziehl & Jones LLP, and William C. Beall, Esq., at Beall and Burkhardt, represent the Debtor as counsel. A Chapter 11 trustee, Thomas P. Jeremiassen, was appointed by the Court on July 23, 2008. Brian D. Fittipaldi, Esq., at the U.S. DOJ/Office of the U.S. Trustee, represents the Chapter 11 trustee as counsel. Robyn B. Sokol, Esq., and Steven T. Gubner, Esq., at Ezra Brutzkus & Gubner, represent the Official Committee of Unsecured Creditors as counsel. In its schedules, Estate Financial listed total assets of $27,428,550, and total debts of $7,316,755. FALCON RIDGE: Can't File Form 10-Q Report on Time ------------------------------------------------- Falcon Ridge Development Inc. said it cannot file its Form 10-Q for the quarter ended December 31, 2008, without unreasonable effort or expense. The Company said it will file its quarterly report very soon. Moore & Associates Chartered in Las Vegas, Nevada, expressed substantial doubt about the Company's ability to continue as a going concern in a letter dated January 13, 2009, to the Board of Directors of Falcon Ridge Development, Inc. The auditor pointed to the Company's significant operating losses during 2008 and 2007, of $4,572,620 and $1,290,190 respectively. In addition, the Company has stockholders' deficit of $1,105,056 as of September 30, 2008, from total assets of $3,237,900 and total liabilities of $4,342,957. Headquartered in Albuquerque, New Mexico, Falcon Ridge Development Inc. -- http://www.falconridgedev.com/-- acquires tracts of raw land for development into residential lots for sale to homebuilders. FANNIE MAE: Posts $58.7 Billion Net Loss for 2008 ------------------------------------------------- Fannie Mae recorded a net loss of $58.7 billion and a diluted loss per share of $24.04 for 2008. The Company's results for 2008 were driven primarily by escalating credit-related expenses, consisting primarily of additions to the Company's combined loss reserves; significant fair value losses; investment losses from other-than-temporary impairment; and a non- cash charge of $21.4 billion in the third quarter of 2008 to establish a partial deferred tax asset valuation allowance. These results reflect the substantial challenges in the housing, mortgage and capital markets during 2008 and particularly during the second half of 2008, as well as the deepening economic recession and extremely challenging financial environment, both of which significantly intensified during the fourth quarter of 2008. For the fourth quarter of 2008, Fannie Mae recorded a net loss of $25.2 billion and a diluted loss per share of $4.47, compared with a net loss of $29.0 billion and a diluted loss per share of $13.00 for the third quarter of 2008. The $3.8 billion decrease in The Company's net loss for the fourth quarter of 2008 compared with the third quarter of 2008 was driven principally by the Company's establishment during the third quarter of a deferred tax asset valuation allowance of $21.4 billion, more than offsetting the increase in fair value losses in the Company's Capital Markets group to $12.3 billion during the fourth quarter of 2008, compared with $3.9 billion during the third quarter of 2008. The Company's mortgage credit book of business increased to $3.1 trillion as of December 31, 2008, from $2.9 trillion as of December 31, 2007, as Fannie Mae have continued to perform The Company's chartered mission of helping provide liquidity to the mortgage markets. The Company's estimated market share of new single-family mortgage-related securities issuances was 41.7% for the fourth quarter of 2008, compared with 42.2% for the third quarter of 2008 and an average estimated market share of 45.4% for the year. The Company's estimated market share of new single- family mortgage-related securities issuances decreased during the second half of 2008 from the levels Fannie Mae achieved during the first half of 2008 primarily due to changes in the Company's pricing and eligibility standards, which reduced the Company's acquisition of higher risk loans, as well as changes in the eligibility standards of the mortgage insurance companies, which further reduced the Company's acquisition of loans with high loan- to-value ratios and other high-risk features. In addition, the estimated market share of new single-family mortgage-related securities issuances that were guaranteed by Ginnie Mae (which primarily guarantees securities backed by FHA insured loans) increased significantly during 2008. The cumulative effect of these changes contributed to a reduction in the Company's mortgage acquisitions during the second half of 2008, compared with the first half of the year. Fannie Mae provide more detailed discussions of key factors affecting changes in the Company's results of operations and financial condition in "Part II-Item 7-MD&A-Consolidated Results of Operations," "Part II-Item 7-MD&A-Business Segment Results," "Part II-Item 7-MD&A-Consolidated Balance Sheet Analysis," "Part II-Item 7-MD&A-Supplemental Non-GAAP Information-Fair Value Balance Sheets," and "Part II-Item 7-MD&A-Risk Management-Credit Risk Management-Mortgage Credit Risk Management-Mortgage Credit Book of Business." Credit Overview Fannie Mae expects economic conditions and falling home prices to continue to negatively affect the Company's credit performance in 2009, which will cause the Company's credit losses to increase. Further, if economic conditions continue to decline, more borrowers will be unable to make their monthly mortgage payments, resulting in increased delinquencies and defaults, sharper declines in home prices and higher credit losses. Net Worth and Fair Value Deficit Net Worth and Fair Value Deficit Amounts Under the Company's senior preferred stock purchase agreement with Treasury, Treasury generally has committed to provide the Company funds of up to $100 billion, on a quarterly basis, in the amount, if any, by which the Company's total liabilities exceed the Company's total assets, as reflected on the Company's consolidated balance sheet, prepared in accordance with GAAP, for the applicable fiscal quarter. On February 18, 2009, in connection with the announcement of HASP, Treasury announced that it is amending the senior preferred stock purchase agreement with the Company to (1) increase its funding commitment from $100 billion to $200 billion, and (2) increase the size of the Company's mortgage portfolio allowed under the agreement by $50 billion to $900 billion, with a corresponding increase in the allowable debt outstanding. In connection with announcing Treasury's planned amendments to the senior preferred stock purchase agreement, Secretary Geithner stated that "Fannie Mae and Freddie Mac are critical to the functioning of the housing finance system in this country and play a key role in making mortgage rates affordable and maintaining the stability and liquidity of the Company's mortgage market" and that "[t]he increased funding will provide forward-looking confidence in the mortgage market and enable Fannie Mae and Freddie Mac to carry out ambitious efforts to ensure mortgage affordability for responsible homeowners." Because an amended agreement has not been executed as of the date of this report, the following discussion of the senior preferred stock purchase agreement, as well as references to that agreement throughout this report, refer to the terms of the existing agreement, without reflecting these changes. Fannie Mae describe the terms of the senior preferred stock purchase agreement in more detail in "Conservatorship, Treasury Agreements, the Company's Charter and Regulation of the Company's Activities-Treasury Agreements." As a result of the Company's net loss for the year ended December 31, 2008, the Company's net worth (defined as the amount by which the Company's total assets exceed the Company's total liabilities, as reflected on the Company's consolidated balance sheet prepared in accordance with GAAP), had a deficit of $15.2 billion as of December 31, 2008, a decrease of $59.3 billion from The Company's net worth of $44.1 billion as of December 31, 2007. As of December 31, 2008, the Company's fair value deficit (which represents a negative fair value of The Company's net assets), as reflected in the Company's consolidated non-GAAP fair value balance sheet, was $105.2 billion, a decrease of $142.5 billion from the fair value of the Company's net assets as of December 31, 2007. The amount that Treasury will invest in the Company under the senior preferred stock purchase agreement is determined based on the Company's GAAP balance sheet, rather than the Company's non-GAAP fair value balance sheet. There are significant differences between the Company's GAAP balance sheet and the Company's non-GAAP fair value balance sheet, which Fannie Mae describe in greater detail in "Part II-Item 7-MD&A- Supplemental Non-GAAP Information-Fair Value Balance Sheets." If current trends in the housing and financial markets continue or worsen, Fannie Mae expect that Fannie Mae also will have a net worth deficit in future periods, and therefore will be required to obtain additional funding from Treasury pursuant to the senior preferred stock purchase agreement. Request for Treasury Investment Under the Regulatory Reform Act, FHFA must place the Company into receivership if the Director of FHFA makes a written determination that the Company's assets are, and during the preceding 60 days have been, less than the Company's obligations. FHFA has notified the Company that the measurement period for such a determination begins no earlier than the date of the SEC filing deadline for the Company's quarterly and annual financial statements and continues for a period of 60 days after that date. FHFA also has advised the Company that, if Fannie Mae receive an investment from Treasury during that 60-day period in order to eliminate the Company's net worth deficit as of the prior period end in accordance with the senior preferred stock purchase agreement, the Director of FHFA will not make a mandatory receivership determination. The Director of FHFA submitted a request on February 25, 2009, to Treasury for $15.2 billion on the Company's behalf under the terms of the senior preferred stock purchase agreement in order to eliminate the Company's net worth deficit as of December 31, 2008. FHFA requested that Treasury provide the funds on or prior to March 31, 2009. Significance of Net Worth Deficit, Fair Value Deficit and Combined Loss Reserves The Company's net worth deficit, which is derived from The Company's consolidated GAAP balance sheet, includes the combined loss reserves of $24.8 billion that Fannie Mae recorded in the Company's consolidated balance sheet as of December 31, 2008. The Company's non-GAAP fair value balance sheet presents all of the Company's assets and liabilities at fair value as of the balance sheet date, based on assumptions and management judgment, as described in more detail in "Part II-Item 7-MD&A-Supplemental Non- GAAP Information-Fair Value Balance Sheets" and "Part II-Item 7- MD&A-Critical Accounting Policies and Estimates." "Fair value" represents the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. This is also sometimes referred to as the "exit price." In determining fair value, Fannie Mae use a variety of valuation techniques and processes, which are described in more detail in "Part II-Item 7- MD&A-Critical Accounting Policies and Estimates-Fair Value of Financial Instruments." In general, fair value incorporates the market's current view of the future, and that view is reflected in the current price of the asset or liability. However, future market conditions may be different from what the market has currently estimated and priced into these fair value measures. Neither the Company's combined loss reserves, as reflected on The Company's consolidated GAAP balance sheet, nor the Company's estimate of the fair value of the Company's guaranty obligations, which Fannie Mae disclose in the Company's consolidated non-GAAP fair value balance sheet, reflects the Company's estimate of the future credit losses inherent in The Company's existing guaranty book of business. Rather, the Company's combined loss reserves reflect only probable losses that Fannie Mae believe Fannie Mae have already incurred as of the balance sheet date, while the fair value of the Company's guaranty obligation is based not only on future expected credit losses over the life of the loans underlying the Company's guarantees as of December 31, 2008, but also on the estimated profit that a market participant would require to assume that guaranty obligation. Because of the severe deterioration in the mortgage and credit markets, there is significant uncertainty regarding the full extent of future credit losses in the mortgage industry as a whole, as well as to any participant in the industry. Therefore, Fannie Mae are not currently providing guidance or other estimates of the credit losses that Fannie Mae will experience in the future. Liquidity Fannie Mae funds purchases of mortgage loans primarily from the proceeds from sales of the Company's debt securities. In September 2008, Treasury made available to the Company two additional sources of funding: the Treasury credit facility and the senior preferred stock purchase agreement, as described below in "Conservatorship, Treasury Agreements, the Company's Charter and Regulation of The Company's Activities-Treasury Agreements." During the second half of 2008, Fannie Mae began to experience significant deterioration in The Company's access to the unsecured debt markets, particularly for long-term and callable debt, and in the yields on the Company's debt as compared with relevant market benchmarks. These conditions, which became especially pronounced in October and November 2008, have had, and are continuing to have, adverse effects on the Company's business and results of operations. Several factors contributed to the reduced demand for the Company's debt securities, including continued severe market disruptions, market concerns about the Company's capital position and the future of The Company's business (including its future profitability, future structure, regulatory actions and agency status) and the extent of U.S. government support for the Company's business. On November 25, 2008, the Federal Reserve announced that it would purchase up to $100 billion in direct obligations of us, Freddie Mac and the FHLBs, and up to $500 billion in MBS guaranteed by the Company, Freddie Mac and Ginnie Mae. Since that time, the Federal Reserve has been supporting the liquidity of the Company's debt as an active and significant purchaser of the Company's long-term debt in the secondary market, and Fannie Mae have experienced noticeable improvement in spreads and in the Company's access to the debt markets in January and February 2009. However, this recent improvement may not continue or may reverse. In addition, while distribution of recent issuances to international investors has been consistent with the Company's distribution trends prior to mid-2007, Fannie Mae continue to experience reduced demand from international investors, particularly foreign central banks, compared with the historically high levels of demand Fannie Mae experienced from these investors between mid-2007 and mid-2008. Because consistent demand for both the Company's debt securities with maturities greater than one year and the Company's callable debt was low between July and November 2008, Fannie Mae were forced to rely increasingly on short-term debt to fund the Company's purchases of mortgage loans, which are by nature long- term assets. As a result, Fannie Mae will be required to refinance, or "roll over," its debt on a more frequent basis, exposing the Company to an increased risk, particularly when market conditions are volatile, that demand will be insufficient to permit the Company to refinance the Company's debt securities as necessary and to risks associated with refinancing under adverse credit market conditions. Further, Fannie Mae expect that the Company's "roll over," or refinancing, risk is likely to increase substantially as Fannie Mae approach year-end 2009 and the expiration of the Treasury credit facility. The Treasury credit facility and the senior preferred stock purchase agreement may provide additional sources of funding in the event that Fannie Mae cannot adequately access the unsecured debt markets. On February 25, 2009, the Director of FHFA submitted a request to Treasury on the Company's behalf for $15.2 billion in funding under the terms of the senior preferred stock purchase agreement in order to eliminate The Company's net worth deficit as of December 31, 2008. There are limitations on the Company's ability to use either of these sources of funding, however, and Fannie Mae describe these limitations in "Part II- Item 7-MD&A-Liquidity and Capital Management-Liquidity Management- Liquidity Contingency Plan." In addition, although the Company's liquidity contingency plan anticipates that Fannie Mae would use specified alternative sources of liquidity to the extent that Fannie Mae are unable to access the unsecured debt markets, Fannie Mae have uncertainty regarding the Company's ability to execute on the Company's liquidity contingency plan in the current market environment. See "Part II-Item 7-MD&A-Liquidity and Capital Management-Liquidity Management-Liquidity Contingency Plan" for a description of the Company's liquidity contingency plan and the current uncertainties regarding that plan. Outlook During the fourth quarter of 2008, the Company's outlook for 2009 worsened. Overall Market Conditions: Fannie Mae expects that the current crisis in the U.S. and global financial markets will continue, which will continue to adversely affect the Company's financial results throughout 2009. Fannie Mae expects the unemployment rate to continue to increase as the economic recession continues. Fannie Mae expects to continue to experience home price declines and rising default and severity rates, all of which may worsen as unemployment rates continue to increase and if the U.S. continues to experience a broad-based recession. Fannie Mae expects mortgage debt outstanding to shrink by approximately 0.2% in 2009. Fannie Mae continues to expect the level of foreclosures and single-family delinquency rates to increase further in 2009. Credit Losses and Loss Reserves: Fannie Mae continues to expect its credit loss ratio (which excludes SOP 03-3 fair value losses and HomeSaver Advance fair value losses) in 2009 will exceed the Company's credit loss ratio in 2008. Fannie Mae also expect a significant increase in the Company's SOP 03-3 fair value losses as Fannie Mae increase the number of loans Fannie Mae repurchase from MBS trusts in order to modify them. In addition, Fannie Mae expect significant continued increases in the Company's combined loss reserves through 2009. Liquidity: Although the Company's access to the debt markets has improved noticeably since late November 2008, Fannie Mae expect continued pressure on the Company's access to the debt markets throughout 2009 at economically attractive rates. Further, Fannie Mae expects the pressure will become increasingly great as Fannie Mae approach the expiration of the Treasury credit facility at the end of 2009. Pressure on the Company's ability to access the debt markets at attractive rates, particularly The Company's ability to issue long-term debt at attractive rates, increases the Company's borrowing costs as well as the Company's "roll over" risk, limits the Company's ability to grow and to manage the Company's market and liquidity risk effectively, and increases the likelihood that Fannie Mae may need to borrow under the Treasury credit facility. Uncertainty Regarding the Company's Future Status and Profitability: Fannie Mae expects that it will experience adverse financial effects because of its strategy of concentrating its efforts on keeping people in their homes and preventing foreclosures, including the Company's efforts under HASP, while remaining active in the secondary mortgage market. In addition, future activities that the Company's regulators, other U.S. government agencies or Congress may request or require the Company to take to support the mortgage market and help borrowers may contribute to further deterioration in the Company's results of operations and financial condition. In a statement issued on September 7, 2008, the then- Secretary of the Treasury stated that there is a consensus that Fannie Mae and Freddie Mac pose a systemic risk and that Fannie Mae could not continue in the Company's then-current form. New York Stock Exchange Listing As of February 26, 2009, the Company's common stock continues to trade on the NYSE. Fannie Mae received a notice from the NYSE on November 12, 2008 that Fannie Mae had failed to satisfy one of the NYSE's standards for continued listing of the Company's common stock because the average closing price of The Company's common stock during the 30 consecutive trading days ended November 12, 2008, had been less than $1.00 per share. On November 26, 2008, Fannie Mae advised the NYSE of its intent to cure this deficiency by May 11, 2009. At that time, Fannie Mae also advised the NYSE that, if necessary to cure the deficiency by that date, and subject to the approval of Treasury, Fannie Mae might undertake a reverse stock split, in which Fannie Mae would combine some specified number of shares of the Company's common stock into a single share of the Company's common stock. Fannie Mae are working internally and with the conservator to determine the specific action or actions that Fannie Mae will take. If the Company's share price and the Company's average share price for the 30 consecutive trading days preceding May 11, 2009, is not at or above $1.00 as of May 11, 2009, the NYSE rules provide that the NYSE will initiate suspension and delisting procedures for the Company's common stock. At that time, Fannie Mae expect that the NYSE also would delist all classes of the Company's preferred stock. For a description of the risks to the Company's business if the NYSE were to delist the Company's common and preferred stock, refer to "Item 1A-Risk Factors." Going Concern Fannie Mae is dependent upon the continued support of the U.S. Government and these agencies in order to maintain a positive net worth, avoid being placed into receivership, and continue to access the debt markets. Fannie Mae continues to operate as a going concern and in accordance with the Company's delegation of authority. The conservatorship has no specified termination date and the future structure of the Company's business following termination of the conservatorship is uncertain. Fannie Mae does not know when or how the conservatorship will be terminated or what changes to the Company's business structure will be made during or following the termination of the conservatorship. Fannie Mae does not know whether it will exist in the same or a similar form or continue to conduct the Company's business as Fannie Mae did before the conservatorship, or whether the conservatorship will end in receivership. Under the Regulatory Reform Act, FHFA must place the Company into receivership if the Director of FHFA makes a written determination that the Company's assets are less than the Company's obligations or if Fannie Mae has not been paying the Company's debts, in either case, for a period of 60 days. In addition, Fannie Mae could be put in receivership at the discretion of the Director of FHFA at any time for other reasons, including conditions that FHFA has already asserted existed at the time the Director of FHFA placed the Company into conservatorship. Placement into receivership would have a material adverse effect on holders of the Company's common stock, preferred stock, debt securities and Fannie Mae MBS. Should Fannie Mae be placed in receivership, different assumptions would be required to determine the carrying value of the Company's assets, which could lead to substantially different financial results. Financial statements are available at: http://ResearchArchives.com/t/s?39f2 About Fannie Mae The Federal National Mortgage Association -- (FNMA) (NYSE: FNM) -- commonly known as Fannie Mae, is a shareholder-owned U.S. government-sponsored enterprise. Fannie Mae has a federal charter and operates in America's secondary mortgage market, providing mortgage bankers and other lenders funds to lend to home buyers at low rates. Fannie Mae was created in 1938, under President Franklin D. Roosevelt, at a time when millions of families could not become homeowners, or risked losing their homes, for lack of a consistent supply of mortgage funds across America. The government established Fannie Mae to expand the flow of mortgage funds in all communities, at all times, under all economic conditions, and to help lower the costs to buy a home. In 1968, Fannie Mae was re-chartered by the U.S. Congress as a shareholder-owned company, funded solely with private capital raised from investors on Wall Street and around the world. Fannie Mae is the U.S. largest mortgage buyer, according to The New York Times. Conservatorship As reported by the Troubled Company Reporter, the U.S. government took direct responsibility for Fannie Mae and Freddie Mac, placing the government sponsored enterprises under conservatorship on September 7, 2008. James B. Lockhart, director of Federal Housing Finance Agency, said that Fannie Mae and Freddie Mac share the critical mission of providing stability and liquidity to the housing market. Between them, the Enterprises have $5.4 trillion of guaranteed mortgage-backed securities (MBS) and debt outstanding, which is equal to the publicly held debt of the United States. Among the key components of the conservatorship, the FHFA, as conservator, assumed the power of the Board and management. FIRST MAGNUS: Trustee Sues Executives for Excessive Spending ------------------------------------------------------------ Gabriela Rico and Josh Brodesky at Arizona Daily Star report that Larry Lattig, the court-appointed trustee advocating First Magnus Financial Corp., has sued the Company's executives for excessive spending. Arizona Daily relates that Lackey Hershman, LLP, filed the $1 billion lawsuit for Mr. Lattig against more than 40 defendants that include former directors and officers of First Magnus Financial and new mortgage company, StoneWater Mortgage Corp. Mr. Lattig said in court documents that First Magnus and "the rest of America" were victims of the "avarice and greed" of top officers Gurpreet Jaggi, Thomas Sullivan Sr., Thomas Sullivan Jr., Bill Gaylord, Gary Malis, Dominick Marchetti, and Karl Young. Arizona Daily quoted Jamie R. Welton, Mr. Lattig's attorney as saying, "They were paying themselves like the Phoenix Suns." Citing Mr. Welton, Arizona Daily states that Mr. Lattig accused the First Magnus executies of having: -- a wing of the Tucson headquarters called the "Sullivan Wing" decorated in rich wood and marble, -- a $170,000 waterfall, -- a $16,000 fish tank, -- an air-conditioned garage for the officers, -- personal use of corporate jets, -- an all-expense-paid trip to a Hawaiian resort weeks before filing for bankruptcy, and -- having taken computer programs to the new mortgage company StoneWater. According to Arizona Daily, Mr. Welton said that most of former First Magnus workers didn't get their final paychecks. Arizona Daily says that First Magnus launched StoneWater less than a year after the Company's bankruptcy. According to Arizona Daily, one of the reasons for the success of First Magnus was the business model of designing and using software to search for more loan options that could be shaped to individual needs, and Mr. Welton said that StoneWater is using the same technology. "They are literally stealing. That's given them a huge head start," the report quoted him as saying. Todd Jackson, the defendants' attorney, said in a statement that a number of former First Magnus executives including Gurpreet Jaggi and Karl Young, president of StoneWater Mortgage Corp., denied the allegations and the claim, dismissing it as "absurd" and "libelous.... It speaks volumes that this suit was first circulated with a press release, complete with promotional material for its authors. The complaint was obviously prepared and publicized in a purposeful effort to maximize the headlines." Citing Mr. Welton, Arizona Daily states that First Magnus bundled and sold mortgages to warehouse lenders without keeping cash reserves that it was obligated to have in the event that the loan was returned. Mr. Welton, according to the report, said that when the loans started to fail, there was nothing for warehouse lenders like Washington Mutual to recoup. First Magnus made $70 billion in loans between January 2005 and August 2007, Reuters states, citing Mr. Welton. The report quoted him as saying, "What happened at First Magnus significantly contributed to the financial crisis." The former officers with First Magnus said in a statement that it was well known that First Magnus collapsed due "market conditions far beyond its influence or control.... The credit market collapse was unprecedented in the nation's history, and had nothing to do with any actions of First Magnus or its officers." About First Magnus Based in Tucson, Arizona, First Magnus Financial Corporation -- http://www.firstmagnus.com/-- purchases and sells prime and Alt-A mortgage loans secured by one-to-four unit residences. The company filed for chapter 11 protection on Aug. 21, 2007 (Bankr. D. Ariz. Case No. 07-01578). John R. Clemency, Esq., at Greenberg Traurig LLP serves as the counsel for the Debtor. The Official Committee of Unsecured Creditors has selected the firm Warner Stevens LLP as its counsel. When the Debtor filed for bankruptcy, it listed total assets of $942,109,860 and total debts of $812,533,046. As of Dec. 31, 2007, the Debtor had total assets of $178,737,936 and total liabilities of $142,241,111. The Debtor's chapter 11 liquidation plan was approved in February 2008. FRANK GRIFFIN: Files for Chapter 7; Dent's Undertaking Closes ------------------------------------------------------------- WRDW.com reports that Frank Griffin has filed for Chapter 7 liquidation. The bankruptcy court has ordered Mr. Griffin's company, Dent's Undertaking Establishment to close, according to WRDW.com. Mr. Griffin's assets, WRDW.com says, will be liquidated to pay his 25 creditors. The only money to pay back creditors will come from the sale of his assets, the report states, citing A. Stephenson Wallace is the case's bankruptcy trustee. Mr. Griffin, according to the report, said in court on Wednesday that his account is overdrawn. There isn't a set date on when the proof of claim must be filed by, but another court hearing for Mr. Griffin's case will be held on March 11, 2009, WRDW.com relates, citing Mr. Wallace. GAINEY CORP: Lester Coggins Obtains Court's Nod to Sell Tractors ---------------------------------------------------------------- The U.S. Bankruptcy Court for the Western District of Michigan issued on Feb. 27, 2009, its order retroactively approving the sale of certain rolling stock of Debtor Lester Coggins Trucking, Inc. to Roy's Trucks and Equipment Inc. As reported in the Troubled Company Reporter on Feb. 11, 2009, the Debtors asked the Court for retroactive approval of Debtor Lester Coggins Trucking, Inc.'s ("LCT") recent sale of 10 tractors to Roy's Trucks & Equipment Inc. The sale closed on Jan. 7, 2009, at a price of $17,500 per tractor, or a total purchase consideration of $175,000. The Debtors told the Court that they own in the aggregate approximately 5,000 trucks and trailers, substantially all of which is subject to a perfected security interest in favor of Wachovia. The negotiation for the sale of the 10 tractors was conducted during September 2008. The proposed sale, however, did not close in September as planned. On Oct. 14, 2008, the Debtors filed their petitions with the Court under Chapter 11 of the Bankruptcy Code. Headquartered in Grand Rapids, Michigan, Gainey Corp. -- http://www.gaineycorp.com/-- provides trucking and freight- services in the U.S. and parts of Canada. It has 5,000 trucks and trailers, and employs more than 2,300 workers including 1,900 truck drivers. The company and its subsidiaries filed for Chapter 11 bankruptcy protection (Bankr. W.D. Mich. Lead Case No. 08-09092) on Oct. 14, 2008. Daniel F. Gosch, Esq., Geoffrey A. Fields, Esq., and John T. Schuring, Esq., and Trent B. Collier, at Dickinson Wright PLLC; and Stephen B. Grow, Esq., at Warner Norcross & Judd, LLP represent the Debtors as counsel. Alixpartners, LLC is the Debtors' restructuring and financial consultant. Jay L. Welford, Esq., Judith Greenstone Miller, Esq., Louis P. Rochkind, Esq., Paul R. Hage, Esq., and Richard E. Kruger, Esq., at Jaffe, Raitt, Heuer & Weiss, PC, represent the Official Committee of Unsecured Creditors as counsel. Virchow Krause and Company, LLP is the Debtor's financial advisor. In its schedules, Gainey Corp. listed total assets of $32,634,336 and total debts of $226,766,249. GAINEY CORP: Exclusive Period to File a Plan Extended to March 31 ----------------------------------------------------------------- The U.S. Bankruptcy Court has extended Gainey Corp. and its debtor-affiliates' exclusive period to file a plan through and including March 31, 2009, and their exclusive period to solicit acceptances of said plan through and including May 31, 2009. As reported in the Troubled Company Reporter on Feb. 11, 2009, the Debtors told the Court that theirs is a large and complex case, involving an entity with approximately $400,000,000 in annual sales, multiple business locations and thousand of employees. The Debtors added that the early proceedings in the case were complicated by the strenuous objections to the initial use of cash collateral, extensive proceedings relating to issues involving the proposed compensation to the Debtors' officers, negotiations for the extended use of cash collateral, and finally by proceedings relating to the U.S. Trustee's request for the appointment of an examiner. These matters have now been resolved. In view of the above, the Debtors said they had not had sufficient time and opportunity to formulate a plan of reorganization. Headquartered in Grand Rapids, Michigan, Gainey Corp. -- http://www.gaineycorp.com/-- provides trucking and freight- services in the U.S. and parts of Canada. It has 5,000 trucks and trailers, and employs more than 2,300 workers including 1,900 truck drivers. The Company and its subsidiaries filed for Chapter 11 bankruptcy protection (Bankr. W.D. Mich. Lead Case No. 08-09092) on Oct. 14, 2008. Daniel F. Gosch, Esq., Geoffrey A. Fields, Esq., and John T. Schuring, Esq., and Trent B. Collier, at Dickinson Wright PLLC; and Stephen B. Grow, Esq., at Warner Norcross & Judd, LLP represent the Debtors as counsel. Alixpartners, LLC is the Debtors' restructuring and financial consultant. Jay L. Welford, Esq., Judith Greenstone Miller, Esq., Louis P. Rochkind, Esq., Paul R. Hage, Esq., and Richard E. Kruger, Esq., at Jaffe, Raitt, Heuer & Weiss, PC, represent the Official Committee of Unsecured Creditors as counsel. Virchow Krause and Company, LLP is the Debtors' financial advisors. In its schedules, Gainey Corp. listed total assets of $32,634,336 and total debts of $226,766,249. GANNETT CO: Moody's Downgrades Ratings on Senior Notes to 'Ba2' --------------------------------------------------------------- Moody's Investors Service downgraded Gannett Co., Inc.'s senior unsecured notes to Ba2 from Baa3 and the commercial paper rating to Not Prime from Prime-3, and also assigned a Ba1 Corporate Family rating, Ba1 Probability of Default Rating, and a SGL-3 speculative-grade liquidity rating. The rating outlook is stable. The rating actions conclude the review for possible downgrade initiated on February 2, 2009. The downgrade reflects Moody's expectation that changing media consumption habits and the heightened level of price and volume competition that Gannett faces as it seeks to monetize its strong local-market content positions in its traditional media and newer digital distribution channels will continue to erode operating cash flow. Moody's believes these pressures along with a deep cyclical slowdown in advertising spending and high operating leverage will lead to a weakening of credit metrics to speculative-grade levels for at least the next two years despite revenue-enhancement initiatives and significant cost reductions. Gannett's 90% dividend reduction will help cushion the pressure on free cash flow from operating declines and allow for meaningful debt repayment in 2009 and 2010, but is an indication of the near and long-term operating challenges. In Moody's view, the operating pressures are also diminishing Gannett's traditional ability to mitigate increases in leverage during cyclical downturns through debt reduction, a factor that in the past had supported a higher rating. Downgrades: Issuer: Gannett Co., Inc. -- Senior Unsecured Notes (unguaranteed), Downgraded to Ba2, LGD5 - 85% from Baa3 -- Commercial Paper, Downgraded to NP from P-3 -- Issuer Rating, Downgraded to Ba2 from Baa3 -- Multiple Seniority Shelf, Downgraded to (P)Ba2 from (P)Baa3 Assignments: Issuer: Gannett Co., Inc. -- Corporate Family Rating, Assigned Ba1 -- Probability of Default Rating, Assigned Ba1 -- Speculative Grade Liquidity Rating, Assigned SGL-3 Outlook Actions: Issuer: Gannett Co., Inc. -- Outlook, Changed To Stable From Rating Under Review The downgrade of the senior unsecured and unguaranteed notes to Ba2 from Baa3 reflects Moody's expectation that the springing guarantee in Gannett's credit facilities will be triggered by the downgrade to speculative-grade. Gannett's material domestic subsidiaries are required to execute guarantees of the credit agreement within 15 days of a guarantee triggering event. As a result, Moody's anticipates that the $1.6 billion of remaining senior unsecured notes will become structurally subordinated to the credit facilities with respect to the assets held by and cash flow generated by U.S. domestic subsidiaries. The LGD5 - 85% assessment on the notes assumes the May 2009 notes are refinanced under the credit facilities and that the aggregate credit facility commitments step down to $2.75 billion from $3.147 billion at 12/31/09 in accordance with the terms of the October 2008 amendments. The stable rating outlook reflects Moody's belief that Gannett's substantial dividend cut demonstrates a focus on debt reduction and liquidity preservation that will allow it to maintain free cash flow-to-debt of at least 8% in 2009 and 2010 and a modest cushion under its 3.5x debt-to-EBITDA covenant, as well as Moody's view that Gannett will proactively manage the liquidity risk inherent in the maturity of its entire capital structure by April 2012. The SGL-3 speculative-grade liquidity rating reflects Moody's expectation that Gannett will maintain an adequate cushion under its credit facility financial covenants. Moody's believes Gannett will generate sufficient free cash flow and maintain ample unused revolver capacity ($1.2 billion as of 12/28/08) to cover the $632 million May 2009 note maturity. Moody's last rating action on Gannett was on February 2, 2009 when the senior unsecured ratings were downgraded to Baa3 from Baa2, the commercial paper rating was downgraded to Prime-3 from Prime-2 and the ratings were placed on review for further possible downgrade. Gannett Co. Inc., headquartered in McLean, Virginia, is a geographically diversified international news and information company. GENERAL MOTORS: Bondholders Wants Gov't Backing for New Debt ------------------------------------------------------------ General Motors Corp. bondholders have asked for a meeting with the auto industry task force to discuss possible government guarantees for billions of dollars in new debt that GM may issue, John D. Stoll and Jeffrey McCracken at The Wall Street Journal report, citing people familiar with the matter. The sources said that some large bondholders were asked by the auto task force to submit a request for a meeting, WSJ states. WSJ relates that GM, as part of its $13.4 billion government loan agreement in December 2008, is required to have a debt-for-equity exchange to cut about $16 billion of its $27 billion in unsecured debt. The report says that the bondholders formed a committee to negotiate with GM. WSJ notes that government backing of the new debt may convince the bond owners to turn in their holdings. According to WSJ, the new debt would be issued along with equity in a bond exchange. Citing sources, WSJ says that many may see little incentive to deal with GM outside of bankruptcy court. According to WSJ, the bondholders also want to discuss GM's viability plan with the task force. WSJ states that the United Auto Workers union is seeking a meeting with the task force. GM Wants to Sell Opel Stake John D. Stoll and Christoph Rauwald at WSJ report that GM will present a proposal this week to sell 25% or more of Opel to secure EUR3.3 billion in financial assistance from Germany and other countries in the region. The plan could be presented as soon as March 2, says WSJ. According to the report, GM officials said that the Company would cut $1.2 billion in costs. WSJ says that GM would meet with German officials this week. Citing people familiar with the matter, WSJ relates that GM may shut down or sell four European plants, including two in Germany. The sources said that one plant being planned to close is part of Saab, WSJ states. WSJ notes that GM Europe has been losing money or breaking even for a decade and lost $2.88 billion last year. According to WSJ, Opel accounts for about three-quarters of GM Europe's sales. Investors could take between 25% and almost 50% in Opel, WSJ states, citing GM Europe President Carl-Peter Forster. WSJ states that GM will present a framework under which Opel and the British Vauxhaull unit will be legally separated from GM and prepared for outside investment. According to WSJ, GM may struggle to find investors for Opel due to the state of the credit markets and weakness in the auto industry. WSJ relates that the government would have more say on how its funds would be used by GM, still the government is worried that financial assistance could be used to cut rather than save jobs in the country, and that GM could use the German government's money to restructure its operations in the U.S. Government assistance for Opel is far from certain, given "many open questions," WSJ says, citing German economics minister Karl- Theodor zu Guttenberg. Opel still has to prove that state-backed loans would be used only by its German businesses and not go to GM in the U.S., Andreas Cremer and Jonathan Stearns at Bloomberg News report, citing Joachim Winkler, a spokesman for the Economy Ministry of Rhineland-Palatinate, one of four German states in which Opel has plants. WSJ relates that German politicians are under pressure from unions to bail out Opel to help save the company's 25,000 jobs. As reported by the Troubled Company Reporter on February 27, 2009, Opel workers started a strike as negotiations for a government bailout on the unit continue. Citing Chancellor Angela Merkel, Bloomberg News states that the German government will study a business plan by Opel before deciding on possible aid for the carmaker. The Leipziger Volkszeitung news daily relates that government officials said that Germany may provide as much as EUR5 billion of credits, loan guarantees or acquire temporary government stakes in Opel if GM Europe amends its restructuring plan. Ms. Merkel said that Economy Minister Karl-Theodor zu Guttenberg will go to the U.S. for talks about government help for GM and the effects of GM's financial crisis on its European divisions, Bloomberg states. Germany will also seek talks with the U.K., Spain, and Belgium, the report says, citing Ms. Merkel. GM Sets Aside $144MM for Saab Supply Bills News daily Dagens Industri reports that GM has put allocated about $144 million to pay suppliers to its Swedish Saab Automobile unit. Citing GM supply manager Bo Andersson, Reuters relates that the company would begin on Monday to pay unsettled bills. GM handed over 1.4 billion crowns to Guy Lofalk, the man appointed to restructure Saab, to continue the unit's operations, Dagens Industri states. "We don't have any problems with deliveries to Saab now," Reuters quoted Mr. Andersson as saying. About General Motors Headquartered in Detroit, Michigan, General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- was founded in 1908. GM employs about 266,000 people around the world and manufactures cars and trucks in 35 countries. In 2007, nearly 9.37 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. General Motors Latin America, Africa and Middle East, with headquarters in Miramar, Florida, is one of GM's four regional business units. GM LAAM employs approximately 37,000 people in 18 countries and has manufacturing facilities in Argentina, Brazil, Colombia, Ecuador, Egypt, Kenya, South Africa and Venezuela. GM LAAM markets vehicles under the Buick, Cadillac, Chevrolet, GMC, Hummer, Isuzu, Opel, Saab and Suzuki brands. GM's common stock was considered the stock market's bellwether for many years, hence the saying "What's good for GM is good for America." As reported in the Troubled Company Reporter on Nov. 10, 2008, General Motors Corporation's balance sheet at Sept. 30, 2008, showed total assets of US$110.425 billion, total liabilities of $170.3 billion, resulting in a stockholders' deficit of $59.9 billion. * * * As reported in the Troubled Company Reporter on Nov. 11, 2008, Standard & Poor's Ratings Services lowered its ratings, including the corporate credit rating, on General Motors Corp. To 'CCC+' from 'B-' and removed them from CreditWatch, where they had been placed with negative implications on Oct. 9, 2008. S&P said that the outlook is negative. Fitch Ratings, as reported in the Troubled Company Reporter on Nov. 11, 2008, placed the Issuer Default Rating of General Motors on Rating Watch Negative as a result of the Company's rapidly diminishing liquidity position. Given the current liquidity level of US$16.2 billion and the pace of negative cash flows, Fitch expects that GM will require direct federal assistance over the next quarter and the forbearance of trade creditors in order to avoid default. With virtually no further access to external capital and little potential for material asset sales, cash holdings are expected to shortly reach minimum required operating levels. Fitch placed these on Rating Watch Negative: -- Senior secured at 'B/RR1'; -- Senior unsecured at 'CCC-/RR5'. As reported in the Troubled Company Reporter on June 24, 2008, DBRS has placed the ratings of General Motors Corp. And General Motors of Canada Limited Under Review with Negative Implications. The rating action reflects the structural deterioration of the company's operations in North America brought on by high oil prices and a slowing U.S. Economy. GENERAL MOTORS: Not Sure on Delphi's Ability to Get Exit Financing ------------------------------------------------------------------ In its viability plan submitted to the Treasury on February 17, General Motors Corp. included the outcome of Delphi's bankruptcy proceedings among "key risks [that] threaten full implementation and require close attention [of the plan]". The U.S. Treasury and U.S. President Barack Obama's automotive task force are currently reviewing the Plan, which requires an additional $16.6 billion on top of $13.4 billion already loaned by the government to GM. The Viability Plan includes near-term liquidity support and other commitments to its former unit, Delphi, based on current agreements between the parties. In addition, GM said that its plan contemplates the purchase of certain sites from Delphi that represent an important source of supply for GM and potential incremental liquidity support as part of reaching an agreement with Delphi on this purchase. According to GM, Delphi is also seeking to address its underfunded pension plans and to secure exit financing to successfully emerge from bankruptcy. GM said that based on current agreements with Delphi, it is required to absorb the remaining hourly pension plan only under certain conditions, which are not currently expected to be met. GM, however, noted that that it has no obligation to absorb Delphi`s salaried pension plan. "As such, the Federal loan support outlined in the Company's revised Plan does not contemplate the transfer of either the hourly or salaried pension plans to GM. Delphi is unlikely to be able to support these underfunded pension plans going forward and may need to terminate these plans, which would impact the PBGC." In addition, a portion of Delphi's exit funding needs would be satisfied through the proceeds stemming from the sale of sites to GM, the automaker said. "However, given current capital market environments, it is uncertain whether Delphi will be able to raise the balance of the funding necessary to exit bankruptcy. If Delphi is unsuccessful in addressing its underfunded pension plans and raising exit financing, it would represent a significant risk to its revised Plan, GM said. "In this event, the Company would consider alternative strategies, including utilizing other sources of supply, albeit requiring some lead time to accomplish." Delphi's April 2 Deadline to File Plan Delphi filed for bankruptcy protection in October 2005, filed its proposed plan of reorganization in September 2007, and obtained confirmation of the amended version of that Plan in January 2008. The Plan, however, was not consummated after a group led by Appaloosa Management, L.P., backed out from their proposal to provide $2,550,000,000 in equity financing to Delphi. Delphi, on October 3, filed a modified Plan that did not require funding by Appaloosa, but required more support from General Motors. Delphi, however, failed to move forward with that plan after failing to arrange adequate exit debt financing. Delphi had obtained extensions of the maturity date of its $4.35-billion debtor-in-possession financing due to delays in its exit from bankruptcy. When the DIP facility couldn't be extended past December 31, Delphi reached an accommodation agreement with lenders under its two most senior tranches of its three-tier DIP facility. The lenders, which have allowed Delphi to retain drawn proceeds from the loan despite the expiration of the DIP facility in December 2008, have required Delphi to submit a reorganization plan by April 2, 2009. Delphi is required to obtain Court approval of the disclosure statement to the April 2 plan not later than May 2, 2009. The Accommodation Agreement expires June 30, 2009, but could be terminated earlier, on May 5, 2009, if the milestones are not achieved. About General Motors Headquartered in Detroit, Michigan, General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- was founded in 1908. GM employs about 266,000 people around the world and manufactures cars and trucks in 35 countries. In 2007, nearly 9.37 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. General Motors Latin America, Africa and Middle East, with headquarters in Miramar, Florida, is one of GM's four regional business units. GM LAAM employs approximately 37,000 people in 18 countries and has manufacturing facilities in Argentina, Brazil, Colombia, Ecuador, Egypt, Kenya, South Africa and Venezuela. GM LAAM markets vehicles under the Buick, Cadillac, Chevrolet, GMC, Hummer, Isuzu, Opel, Saab and Suzuki brands. As reported in the Troubled Company Reporter on Nov. 10, 2008, General Motors Corporation's balance sheet at Sept. 30, 2008, showed total assets of US$110.425 billion, total liabilities of US$170.3 billion, resulting in a stockholders' deficit of US$59.9 billion. * * * As reported in the Troubled Company Reporter on Nov. 11, 2008, Standard & Poor's Ratings Services lowered its ratings, including the corporate credit rating, on General Motors Corp. to 'CCC+' from 'B-' and removed them from CreditWatch, where they had been placed with negative implications on Oct. 9, 2008. S&P said that the outlook is negative. Fitch Ratings, as reported in the Troubled Company Reporter on Nov. 11, 2008, placed the Issuer Default Rating of General Motors on Rating Watch Negative as a result of the company's rapidly diminishing liquidity position. Given the current liquidity level of US$16.2 billion and the pace of negative cash flows, Fitch expects that GM will require direct federal assistance over the next quarter and the forbearance of trade creditors in order to avoid default. With virtually no further access to external capital and little potential for material asset sales, cash holdings are expected to shortly reach minimum required operating levels. Fitch placed these on Rating Watch Negative: -- Senior secured at 'B/RR1'; -- Senior unsecured at 'CCC-/RR5'. As reported in the Troubled Company Reporter on June 24, 2008, DBRS has placed the ratings of General Motors Corp. and General Motors of Canada Limited Under Review with Negative Implications. The rating action reflects the structural deterioration of the company's operations in North America brought on by high oil prices and a slowing U.S. Economy. About Delphi Corp. Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ) -- http://www.delphi.com/-- is the single supplier of vehicle electronics, transportation components, integrated systems and modules, and other electronic technology. The company's technology and products are present in more than 75 million vehicles on the road worldwide. Delphi has regional headquarters in Japan, Brazil and France. The company filed for Chapter 11 protection on Oct. 8, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP, represent the Official Committee of Unsecured Creditors. As of June 30, 2008, the Debtors' balance sheet showed US$9,162,000,000 in total assets and US$23,742,000,000 in total debts. The Court approved Delphi's First Amended Joint Disclosure Statement and related solicitation procedures for the solicitation of votes on the First Amended Plan on Dec. 20, 2007. The Court confirmed the Debtors' First Amended Plan on Jan. 25, 2008. The Plan has not been consummated after a group led by Appaloosa Management, L.P., backed out from their proposal to provide US$2,550,000,000 in equity financing to Delphi. Delphi, on October 3, filed modifications to their Plan of Reorganization, which did not require funding by Appaloosa, but required more support from General Motors. Delphi, however, failed to move forward with that plan after failing to arrange exit debt financing. Delphi has reached an accommodation agreement with certain lenders of its $4.35-billion debtor-in-possession financing. The lenders, which have allowed Delphi to retain drawn proceeds despite the expiration of the DIP facility in December 2008, have required Delphi to submit a reorganization plan by April 2, 2009. (Delphi Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) GENERAL MOTORS: Delphi Gets SEC Nod to Redact Terms of MRA Pact --------------------------------------------------------------- Delphi Corp. obtained approval from the Securities and Exchange Commission of its request for confidential treatment of information it excluded from an exhibit to its third quarter 2008 results on Form 10-Q that it filed on November 10, 2008. Based on representations by Delphi that the excluded items from the exhibit qualifies as confidential commercial or financial information under the Freedom of Information Act, 5 U.S.C. 552(b)(4), the SEC's Division of Corporation Finance has determined not to publicly disclose them. The SEC's order said that the excluded information from "Exhibit 10(f)" will not be released through December 31, 2015. The Exhibit 10(f) is a copy of the Amended and Restated Master Restructuring Agreement dated September 12, 2008, between Delphi and its former parent General Motors Corp. The MRA is one of two comprehensive settlement agreements reached with GM that Delphi filed together with its proposed plan of reorganization, the original version of which was filed in September 2007. The MRA governs certain aspects of Delphi and GM's commercial relationship following Delphi's emergence from Chapter 11. The MRA addresses, among other things, the scope of GM's existing and future business awards to Delphi and related pricing agreements and sourcing arrangements, GM commitments with respect to reimbursement of specified ongoing labor costs, the disposition of certain Delphi facilities, and the treatment of existing agreements between Delphi and GM. The other agreement, the Global Settlement Agreement, resolves outstanding issues among Delphi and GM that have arisen or may arise before Delphi's emergence from Chapter 11, including, commitments regarding OPEB and pension obligations, other GM contributions with respect to labor matters, releases, and claims treatment. In September 2008, due to delays in implementing its Bankruptcy Court-confirmed plan of reorganization, Delphi sought amendments to the GSA and MRA to authorized those agreements to be effective independent of and in advance of the effective date of the company's POR. At the time it sought the amendments, Delphi said it will receive support from GM valued at $10.6 billion. Items from the MRA that were omitted because they were confidential include: * The terms of an access agreement which (i) grants GM, under certain circumstances, access to Delphi's facilities, and (ii) takes effect after Delphi's emergence from bankruptcy (the omitted items include the period of the agreement and the events that would trigger right of access); * The net separation costs ($75 million less the amounts the buyer agrees to pay) incurred by Delphi as a result of the sale of its global interiors businesses, global steering business and Sandusky business, * Outstanding GM purchase orders, and recently awarded business by GM to Delphi, * A four-page spreadsheet on contract extensions, * Changes in manufacturing location in respect of various product lines, * Form of monthly invoice for the aggregate amount of the applicable cash burn percentage of production cash burn incurred at all "support facilities." The table provides for certain reimbursement amounts for the cash burn, which is defined as the sum specified cash expenditures by Delphi less net sales at each support facility. A portion in the MRA provides that for the purposes of determining Production Cash Burn, overhead will be deemed to be a fixed 2.25% of net sales for all Support Facilities except for the Flint East Facility, the Sandusky Facility, the Saginaw Steering Facility, the Adrian Facility, and the Athens Facility where overhead will be deemed to be 5.0% of net sales. * Letter from Bill Hurles, of GM, to Jeff Paprocki, of Delphi, dated February 1, 2007, under which both parties have agreed to work together to minimize excess and obsolete materials with respect to the Support Facilities, and * the GM intellectual property proposal. A copy of the MRA on Exhibit 10(f) is available at: http://researcharchives.com/t/s?39f5 About Delphi Corp. Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ) -- http://www.delphi.com/-- is the single supplier of vehicle electronics, transportation components, integrated systems and modules, and other electronic technology. The company's technology and products are present in more than 75 million vehicles on the road worldwide. Delphi has regional headquarters in Japan, Brazil and France. The company filed for Chapter 11 protection on Oct. 8, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP, represent the Official Committee of Unsecured Creditors. As of June 30, 2008, the Debtors' balance sheet showed US$9,162,000,000 in total assets and US$23,742,000,000 in total debts. The Court approved Delphi's First Amended Joint Disclosure Statement and related solicitation procedures for the solicitation of votes on the First Amended Plan on Dec. 20, 2007. The Court confirmed the Debtors' First Amended Plan on Jan. 25, 2008. The Plan has not been consummated after a group led by Appaloosa Management, L.P., backed out from their proposal to provide US$2,550,000,000 in equity financing to Delphi. Delphi, on October 3, filed modifications to their Plan of Reorganization, which did not require funding by Appaloosa, but required more support from General Motors. Delphi, however, failed to move forward with that plan after failing to arrange exit debt financing. Delphi has reached an accommodation agreement with certain lenders of its $4.35-billion debtor-in-possession financing. The lenders, which have allowed Delphi to retain drawn proceeds despite the expiration of the DIP facility in December 2008, have required Delphi to submit a reorganization plan by April 2, 2009. (Delphi Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) About General Motors Headquartered in Detroit, Michigan, General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- was founded in 1908. GM employs about 266,000 people around the world and manufactures cars and trucks in 35 countries. In 2007, nearly 9.37 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. General Motors Latin America, Africa and Middle East, with headquarters in Miramar, Florida, is one of GM's four regional business units. GM LAAM employs approximately 37,000 people in 18 countries and has manufacturing facilities in Argentina, Brazil, Colombia, Ecuador, Egypt, Kenya, South Africa and Venezuela. GM LAAM markets vehicles under the Buick, Cadillac, Chevrolet, GMC, Hummer, Isuzu, Opel, Saab and Suzuki brands. As reported in the Troubled Company Reporter on Nov. 10, 2008, General Motors Corporation's balance sheet at Sept. 30, 2008, showed total assets of US$110.425 billion, total liabilities of US$170.3 billion, resulting in a stockholders' deficit of US$59.9 billion. * * * As reported in the Troubled Company Reporter on Nov. 11, 2008, Standard & Poor's Ratings Services lowered its ratings, including the corporate credit rating, on General Motors Corp. to 'CCC+' from 'B-' and removed them from CreditWatch, where they had been placed with negative implications on Oct. 9, 2008. S&P said that the outlook is negative. Fitch Ratings, as reported in the Troubled Company Reporter on Nov. 11, 2008, placed the Issuer Default Rating of General Motors on Rating Watch Negative as a result of the company's rapidly diminishing liquidity position. Given the current liquidity level of US$16.2 billion and the pace of negative cash flows, Fitch expects that GM will require direct federal assistance over the next quarter and the forbearance of trade creditors in order to avoid default. With virtually no further access to external capital and little potential for material asset sales, cash holdings are expected to shortly reach minimum required operating levels. Fitch placed these on Rating Watch Negative: -- Senior secured at 'B/RR1'; -- Senior unsecured at 'CCC-/RR5'. As reported in the Troubled Company Reporter on June 24, 2008, DBRS has placed the ratings of General Motors Corp. and General Motors of Canada Limited Under Review with Negative Implications. The rating action reflects the structural deterioration of the company's operations in North America brought on by high oil prices and a slowing U.S. Economy. GEORGIA GULF: Weak Housing Markets Cue Fitch's Junk Ratings ----------------------------------------------------------- Fitch Ratings has downgraded Georgia Gulf Corp.'s Issuer Default Rating to 'CC' from 'B-' given continued weakness in the North American housing markets and the sharp decline in industrial markets associated with the global economic recession. Fitch has taken additional rating actions: -- Senior secured revolving credit facility to 'B/RR1' from 'BB-/RR1'; -- Senior secured term loan B to 'B/RR1' from 'BB-/RR1'; -- Senior unsecured notes to 'C/RR6' from 'CCC/RR6'; -- Senior subordinated notes to 'C/RR6' from 'CCC/RR6'. The ratings reflect continued weak demand for GGC's products, compressed margins, and tight liquidity. GGC's end-markets are reliant on the level of residential construction and remodeling. In addition, fourth quarter results were impacted by the economic contraction as well as inventory holding losses in Aromatics driven by benzene and propylene price declines. GGC has closed two PVC resin plants representing about 25% of its capacity, consolidated production, reduced headcount by 15%, frozen salaries and its pension plan. GGC had cash on hand of roughly $90 million and $143 million available under its revolver. Fitch does not believe GGC will be in compliance with its bank debt covenants on June 30, 2009 and the company is working on covenant relief. Management believes that internally generated cash flow will be sufficient to cover its obligations in 2009. In a prolonged downturn, Fitch believes GGC will require its current revolver availability to provide adequate liquidity. Based in Atlanta, GGC is a commodity chemicals producer. Its product portfolio includes VCM, PVC resin, vinyl compounds, cumene, acetone, phenol, window and door profiles and moldings as well as outdoor building products. GGC earned approximately $174 million of EBITDA from continuing operations on sales of $2.9 billion in 2008. GLOBAL NETWORK: Voluntary Chapter 11 Case Summary ------------------------------------------------- Debtor: Global Network Communications, Inc. 1144 31st Drive Long Island City, NY 11106 Bankruptcy Case No.: 09-10868 Type of Business: The Debtor is a payphone operator. Chapter 11 Petition Date: February 26, 2009 Court: Northern District of California (Oakland) Judge: Stuart M. Bernstein Debtor's Counsel: Joseph P. Garland, Esq. jpg65@columbia.edu 275 Madison Avenue, 11th Floor New York, NY 10016 Tel: (212) 213-1812 Fax: (212) 213-1816 Estimated Assets: $10 million to $50 million Estimated Debts: $1 million to $10 million The Debtor did not file a list of 20 largest unsecured creditors. The petition was signed by Ronald E. Massie, president. HAYES LEMMERZ: Fitch Junks Issuer Default Rating from 'B-' ---------------------------------------------------------- Fitch Ratings has downgraded the Issuer Default Ratings and outstanding debt ratings of Hayes Lemmerz International Inc. and its subsidiaries: Hayes Lemmerz International, Inc. -- IDR to 'CCC' from 'B-'; HLI Operating Company, Inc. -- IDR to 'CCC' from 'B-'; -- Senior secured revolving credit facility to 'B-/RR3' from 'B+/RR2'; Hayes Lemmerz Finance - Luxembourg S.A. (European Holdco) -- IDR to 'CCC' from 'B-'; -- Senior secured revolving credit facility to 'B-/RR3' from 'B+/RR2'; -- Senior secured Euro synthetic LOC facility to 'B-/RR3' from 'B+/RR2'; -- Senior secured Euro term loan to 'B-/RR3' from 'B+/RR2'; -- Senior unsecured Euro notes to 'C/RR6' from 'CCC/RR6'. All ratings remain on Rating Watch Negative, where they were originally placed on Dec. 11, 2008. Fitch's actions affect approximately $570 million of balance sheet debt. The downgrades reflects Fitch's expectations for a deep and extended decline in global auto volumes and the terms of the amended credit facility which only provides HAYZ covenant relief for a year. Fitch expects every major region of the world to experience a decline in sales in 2009, which will pressure all auto suppliers. The Rating Watch Negative was discussed in the Dec. 11, 2008 Fitch commentary titled 'Fitch Places Seven U.S. Auto Suppliers on Rating Watch Negative.' As discussed in the aforementioned commentary, the Rating Watch Negative is based on the uncertain longer-term federal assistance for the U.S. original equipment manufacturers and the impact of a potential bankruptcy filing by General Motors. In the event of a General Motors bankruptcy, Fitch's prospective IDR for HAYZ could be 'CC'. The Rating Watch Negative is also based on Fitch's concerns about the credit facility covenants which return to their original terms on April 30, 2010. HAYZ was provided credit facility covenant relief prior to the close of its fiscal year ending Jan. 31, 2009. Fitch estimates that without the amendments HAYZ would have violated its 3.5 times (x) net leverage covenant, which was amended to 5.5x for the period. Fitch believes this amendment and the new covenant levels (including a 7.25x leverage level for the third quarter ending Oct. 31, 2009) are indicators of the significant impact the industry environment has had on HAYZ' business. HAYZ reported 2.5x credit facility net leverage at the end of October. Without a global auto and commercial truck market turnaround, Fitch believes HAYZ will have to renegotiate its credit facilities again in a year. Fitch expects global automotive market weakness to continue through 2009 with possible modest improvement in 2010. Fitch estimates no material rebound in commercial truck volume in North America this year especially in the first half and commercial truck production in Western Europe to decline significantly. These market weaknesses will pressure HAYZ's cash flow and margins throughout the year. To adjust to the volume declines HAYZ has reduced manufacturing costs, reduced SG&A expenses, and brought its capital expenditures down to maintenance levels. The ratings are supported by HAYZ's leading position in the global wheel market, geographic and customer diversity, and significant progress in restructuring operations. HAYZ has no significant debt maturities until 2014. Fitch has adjusted its recovery valuation of HAYZ to reflect the more severe market downturn. The analysis remains based on a going concern scenario rather than liquidation. Recovery ratings on the senior secured debt have been downgraded to 'RR3' (51%-70% recovery) from 'RR2' and the recovery ratings on HAYZ's senior unsecured Euro notes remain 'RR6' (0%-10% recovery). Including the cash and marketable securities balance of $57 million, total liquidity at the end of HAYZ's third quarter on Oct. 31, 2008 was approximately $166 million. At quarter end, HAYZ had $16 million of borrowing under its $125 million secured revolver. As of Oct. 31, 2008 Fitch calculates that HAYZ debt-to- LTM EBITDA remained virtually flat at 3.7x, from 3.8x at the end of its fiscal year ending Jan. 30, 2009. Fitch's calculated debt- to-EBITDA metric is more conservative than HAYZ's reported debt- to-LTM adjusted EBITDA figure. HAYZ is the world's largest producer of automotive and commercial highway steel and aluminium wheels, having operations in 13 countries and approximately 7,500 employees. HAYZ is now a wheels-focused company after divestures of its components segment businesses over the last several years. In fiscal 2007, 96% of HAYZ's revenue came from global wheel sales and 80% of HAYZ's revenue came from outside the U.S. HERITAGE COMMUNITY: Illinois Regulators Appoint FDIC as Receiver ---------------------------------------------------------------- Heritage Community Bank, based in Glenwood, Illinois, was closed on Fri., Feb. 27, 2009, by the Illinois Department of Financial Professional Regulation, Division of Banking, which appointed the Federal Deposit Insurance Corporation as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with MB Financial Bank, N.A., Chicago, Illinois, to assume all of the deposits of Heritage Community Bank. The four offices of Heritage Community Bank reopened as branches of MB Financial Bank on Sat., Feb. 28, 2009. Depositors of Heritage Community Bank automatically became depositors of MB Financial Bank. Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship to retain their deposit insurance coverage. As of Dec. 5, 2008, Heritage Community Bank had total assets of $232.9 million and total deposits of $218.6 million. In addition to assuming all of the deposits of the failed bank, including those from brokers, MB Financial Bank agreed to purchase approximately $230.5 million in assets at a discount of $14.5 million. The FDIC will retain the remaining assets for later disposition. The FDIC and MB Financial Bank entered into a loss-share transaction. MB Financial Bank will share in the losses on approximately $181 million in assets covered under the agreement. The loss-sharing arrangement is projected to maximize returns on the assets covered by keeping them in the private sector. The agreement also is expected to minimize disruptions for loan customers as they will maintain a banking relationship. The FDIC estimates that the cost to the Deposit Insurance Fund will be $41.6 million. MB Financial Bank's acquisition of all the deposits was the "least costly" resolution for the FDIC's Deposit Insurance Fund compared to alternatives. Heritage Community Bank is the fifteenth FDIC-insured institution to fail in the nation this year and the third in the state. The last FDIC-insured institution closed in Illinois was Corn Belt Bank and Trust Company, Pittsfield, on Feb. 13, 2009. Heritage Community Bank is not affiliated with Heritage Bank of Central Illinois, Heritage Bank of Schaumburg, or Heritage State Bank, Lawrenceville. HERTZ CORP: Bank Loan Sells at 30% Off in Secondary Market ---------------------------------------------------------- Participations in a syndicated loan under which Hertz Corporation is a borrower traded in the secondary market at 65.85 cents-on- the-dollar during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. This represents a decrease of 2.37 percentage points from the previous week, the Journal relates. Hertz bank debt traded in the secondary market at 68.22 cents-on- the-dollar during the week ended February 20, 2009, an increase of 1.47 percentage points from the week before last. The loan matures on December 21, 2012. Hertz pays 150 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's Ba1 rating and Standard & Poor's BB+ rating. Meanwhile, participations in a syndicated loan under which Avis Budget Car Rental LLC is a borrower traded in the secondary market at 37.80 cents-on-the-dollar during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. This represents a drop of 3.92 percentage points from the previous week, the Journal relates. The loan matures April 1, 2012. Avis Budget pays 125 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's Ba3 rating and Standard & Poor's B rating. Syndicated loans of auto parts makers also slid in secondary market trading during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. Investors avoided TRW Automotive and Visteon Corp. bank debt. Participations in a syndicated loan under which TRW Automotive is a borrower traded in the secondary market at 57.20 cents-on-the- dollar, a drop of 7.13 percentage points -- at 64.33 cents-on-the- dollar -- from the previous week. TRW Automotive pays 150 basis points to borrow under the facility. The bank loan carries Moody's Ba1 rating and Standard & Poor's BBB- rating. Visteon Corp. bank debt continued its slide, trading in the secondary market at 17.71 cents-on-the-dollar during the week ended February 27, 2009. This represents a drop of 2.50 percentage points -- at 20.21 cents-on-the-dollar -- from the previous week. The loan matures May 30, 2013. Visteon pays 300 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B3 rating and Standard & Poor's B- rating. Dana Corporation bank debt traded in the secondary market at 30.43 cents-on-the-dollar, a drop of 2.97 percentage points -- at 33.40 cents-on-the-dollar -- from the previous week. The loan matures January 31, 2015. Dana pays 375 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B3 rating and Standard & Poor's B+ rating. Lear Corp. bank debt traded in the secondary market at 34.57 cents-on-the-dollar, a drop of 3.99 percentage points -- at 38.56 cents-on-the-dollar -- from the previous week. The loan matures March 29, 2012. Lear pays 250 basis points above LIBOR to borrow under the facility. The bank loan is not rated. About Hertz Corp. The Hertz Corporation, a subsidiary of Hertz Global Holdings, Inc. (NYSE: HTZ), is the world's largest general use car rental brand, operating from approximately 8,000 locations in 147 countries worldwide. Hertz also operates one of the world's largest equipment rental businesses, Hertz Equipment Rental Corporation, through more than 375 branches in the United States, Canada, France, Spain and China. HILL-ROM HOLDINGS: S&P Assigns 'BB+' Initial Subordinated Rating ---------------------------------------------------------------- Standard & Poor's Ratings Services said that it assigned its preliminary 'BBB-' senior unsecured rating and preliminary 'BB+' subordinated rating to debt securities filed by Batesville, Indiana-based Hill-Rom Holdings Inc. as part of a Rule 415 shelf registration. This filing falls under the SEC's well-known seasoned issuer rules, which do not require a dollar amount of securities to be registered. The BBB-/Stable/-- corporate credit rating on Hill-Rom reflects the company's satisfactory business risk profile, highlighted by its market-leading position in its hospital beds and surfaces business, and its low debt leverage, sufficient liquidity, and overall intermediate financial risk profile. Rating concerns include the tight capital budgets of its hospital clients, its relatively narrow focus on beds and surfaces, the disappointing performance of the company's rental business, and the possibility that Hill-Rom's acquisition strategy could become more aggressive following the expiration of the company's distribution agreement with Hillenbrand. Ratings List Hill-Rom Holdings Inc. Corporate credit rating BBB-/Stable/-- Ratings Assigned Senior unsecured shelf debt prelim BBB- Subordinated shelf debt prelim BB+ HOME INTERIORS: Can Sell Computer Equipment to Home & Garden ------------------------------------------------------------ The U.S. Bankruptcy Court for the Northern District of Texas approved on Feb. 26, 2009, the motion of Dennis Faulkner, the Chapter 11 Trustee in Home Interiors & Gifts, Inc., and its debtor-affiliates' bankruptcy cases, for (i) the exercise of the Company's equipment purchase option on its computer equipment lease agreement with Dell Financial Services, L.P.; and (ii) the immediate sale of the computer equipment to Home & Garden Party free and clear of all liens, claims, encumbrances, and interests. As reported in the Troubled Company Reporter on Feb. 9, 2009, Dell Financial Services assigned its interest in the lease to Citicorp Vendor Finance, Inc. on July 13, 2007, and Citicorp Vendor Finance in turn assigned its interest to CIT Technology Financing (the Lessor) on July 19, 2007. As reported in the Troubled Company Reporter on Jan. 8, 2009, the Court approved at a sale hearing on Dec. 23, 2008, the sale of substantially all of the domestic assets of Home Interior & Gifts, Inc., and Home Interiors de Puerto Rico, Inc., to Home & Garden Party, Ltd., a Texas limited partnership, free and clear of all liens, claims, encumbrances, and interests, for the purchase price of $6,882,000. Home & Garden Party had sought to buy the computer equipment subject to the lease, but because the Trustee was unable to give sufficient notice of the proposed transaction to the Lessor, the sale was not completed. The Lessor agreed to allow the Trustee to exercise the purchase option for the total consideration of $50,000. The Trustee, in turn will immediately sell the computer equipment to Home and Garden Party for the sum of $100,000. The Trustee is currently holding $75,000 of the purchase in escrow and Home & Garden Party will contribute an additional $25,000 to complete the sale. At closing the Trustee will distribute the proceeds of the sale, as follows: -- $50,000 of the escrowed funds will be distributed to CIT in full satisfaction of its claim; -- $50,000 will be transferred to the Pre-Petition Asgent, for the Prepetion Lenders. About Home Interiors Headquartered in Carrollton, Texas, Home Interiors & Gifts, Inc. -- http://www.homeinteriors.com/-- manufactures, imports and distributes indoor and outdoor home decorative accessories. It was founded by Mary Crowley in 1957. Through its affiliates, the company has a significant presence in Mexico, Puerto Rico, and Canada. Annual revenue in 2007 reached $300 million. When Mary Crowley, died in 1986, her son, Don Carter continued the business operation nearly debt-free. In a leveraged transaction in 1998, private equity firm of Hicks, Muse, Tate, and Furst acquired 66% of the parent company, which resulted in the imposition of more than $500 million in debt on the Debtors. In the face of decreased sales and increased debt load, bondholders canceled their debts in February 2006 in exchange for receiving most of the outstanding equity of the Debtors. About 40% of the goods the Debtors sell are now acquired from manufacturers in China. In the last decade, sales volume in the U.S. has waned, but the Debtors reported that sales in Mexico and Puerto Rico significantly increased. The Company and six of its affiliates filed for Chapter 11 protection on April 29, 2008 (Bankr. N.D. Tex. Lead Case No. 08-31961). Andrew Jillson, Esq., Cameron Kinvig, Esq., Robert McCormick, Esq., and Mike Massad, Esq., at Hunton & Williams, LLP, represent the Debtors as counsel. Richard A. Lindenmuth at Boulder International LLC, is designated as CRO. The U.S. Trustee for Region 6 has appointed seven creditors to serve on an Official Committee of Unsecured Creditors. Munsch Hardt Kopf & Harr, PC represents the Committee in these cases. Kurtzman Carson Consultants LLC is the Official Noticing and Balloting Agent. In its schedules, Home Interiors & Gifts, Inc. listed $88,653,051 in total assets, and $510,451,698 in total liabilities. As reported in the Troubled Company Reporter on Dec. 11, 2008, the Court approved the appointment by the United States Trustee of Dennis Faulkner as Chapter 11 trustee in the Debtors' bankruptcy cases. Dennis Faulkner, of the accounting firm of Lain, Faulkner & Co., P.C., is a member of the American Bankruptcy Institute and the Association of Insolvency and Restructuring Advisors. Lain, Faulkner & Co., P.C. is an accounting firm which specializes in bankruptcy, litigation and business advisory services. HOME INTERIORS: Court OKs Sale of Mexican Entities' Capital Stock ------------------------------------------------------------------ At the request of Dennis Faulkner, the Chapter 11 Trustee for Home Interiors & Gifts, Inc., including its wholly owned debtor subsidiaries, the U.S. Bankruptcy Court for the Northern District of Texas approved on Feb. 26, 2009, the sale of the capital stock of Home Interiors de Mexico, S de RL de CV, and Home Interiors de Mexico, S.A. de C.V. (collectively, the Mexican Entities) and all trademarks related to the operation of the Mexican Entities, free and clear of all liens, claims, encumbrances, and interests, to Marks Hill Mexico Direct Selling I, LLC and Marks Hill Mexico Direct Selling II, LLC, for the purchase price of $1,250,000. The buyers submitted the lone bid at the Feb. 23, 2009, auction. The Pre-Petition Agent and the Pre-Petition Lenders consented to the sale, under the terms of the order, including the provisions concerning distribution of the sale proceeds. Pursuant to the order, the Trustee is authorized and directed to disburse the Sale Proceeds as follows: a. to Houlihan Lokey Howard & Zukin Capital, Inc., the Debtors' investment bankers and financial advisor, the amount of $125,000.00 in net fees and $4,617.00 in outstanding expenses from the sale proceeds at closing; b. to a bank of the Pre-Petition Agent's choosing, 35% of the remaining sale proceeds to be held pursuant to the Second Final Order authorizing the Debtors' Use of Cash Collateral; and c. the remainder to the Pre-Petition Agent, for the benefit of the Pre-Petition Lenders. As previously disclosed, on Dec. 3, 2008, the Court gave the Debtors permission to sell their assets pursuant to competitive bidding and public auction. No stalking horse bidder for each of the asset groups was named. A full-text copy of the Stock Purchase Agreement is available at: http://bankrupt.com/misc/HomeInteriors.StockPurchaseAgreement.pdf About Home Interiors Headquartered in Carrollton, Texas, Home Interiors & Gifts, Inc. -- http://www.homeinteriors.com/-- manufactures, imports and distributes indoor and outdoor home decorative accessories. It was founded by Mary Crowley in 1957. Through its affiliates, the company has a significant presence in Mexico, Puerto Rico, and Canada. Annual revenue in 2007 reached $300 million. When Mary Crowley, died in 1986, her son, Don Carter continued the business operation nearly debt-free. In a leveraged transaction in 1998, private equity firm of Hicks, Muse, Tate, and Furst acquired 66% of the parent company, which resulted in the imposition of more than $500 million in debt on the Debtors. In the face of decreased sales and increased debt load, bondholders canceled their debts in February 2006 in exchange for receiving most of the outstanding equity of the Debtors. About 40% of the goods the Debtors sell are now acquired from manufacturers in China. In the last decade, sales volume in the U.S. has waned, but the Debtors reported that sales in Mexico and Puerto Rico significantly increased. The Company and six of its affiliates filed for Chapter 11 protection on April 29, 2008 (Bankr. N.D. Tex. Lead Case No. 08-31961). Andrew Jillson, Esq., Cameron Kinvig, Esq., Robert McCormick, Esq., and Mike Massad, Esq., at Hunton & Williams, LLP, represent the Debtors as counsel. Richard A. Lindenmuth at Boulder International LLC, is designated as CRO. The U.S. Trustee for Region 6 has appointed seven creditors to serve on an Official Committee of Unsecured Creditors. Munsch Hardt Kopf & Harr, PC represents the Committee in these cases. Kurtzman Carson Consultants LLC is the Official Noticing and Balloting Agent. In its schedules, Home Interiors & Gifts, Inc. listed $88,653,051 in total assets, and $510,451,698 in total liabilities. As reported in the Troubled Company Reporter on Dec. 11, 2008, the Court approved the appointment by the United States Trustee of Dennis Faulkner as Chapter 11 trustee in the Debtors' bankruptcy cases. Dennis Faulkner, of the accounting firm of Lain, Faulkner & Co., P.C., is a member of the American Bankruptcy Institute and the Association of Insolvency and Restructuring Advisors. Lain, Faulkner & Co., P.C. is an accounting firm which specializes in bankruptcy, litigation and business advisory services. HOMELAND SECURITY: Dec. 31 Balance Sheet Upside Down by $809,448 ---------------------------------------------------------------- Homeland Security Capital Corporation's balance sheet at December 31, 2008, showed total assets of $37,014,687, total liabilities of $37,654,367 and warrants payable - Series H totaling $169,768, resulting in total stockholders' deficit of $809,448. For the three months ended December 31, 2008, the Company recorded contract revenue of $22,212,461 and contract cost was $18,480,949. Operating expenses for the three months ended December 31, 2008 were $3,387,548. The Company had net other expense of $611,015 for the three months ended December 31, 2008. The Company incurred income taxes in the three months ended December 31, 2008 in the amount of $143,000 as a result of income taxable to state jurisdictions that is not subject to offset by NOL carryovers. As a result, the Company recorded a net loss from continuing operations of $410,051 for the three months ended December 31, 2008. About Homeland Security Headquartered in Arlington, Virginia, Homeland Security Capital Corporation (OTC BB: HOMS) -- http://www.hscapcorp.com/-- is a consolidator in the fragmented homeland security industry. The company acquires companies that provide security services and products. The company is headed by former Congressman C. Thomas McMillen, who served three consecutive terms in the U.S. House of Representatives from the 4th Congressional District of Maryland. The Company has historically incurred losses which have resulted in a total retained deficit of $62,412,158 at December 31, 2008. Management recognizes it will be necessary to continue to generate positive cash flow from operations and have availability to other sources of capital to continue as a going concern. HUNTSMAN ICI: Bank Loan Sells at 30% Off in Secondary Market ------------------------------------------------------------ Participations in a syndicated loan under which Huntsman ICI is a borrower traded in the secondary market at 68.60 cents-on-the- dollar during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. This represents a drop of 1.70 percentage points from the previous week, the Journal relates. The bank loan matures April 23, 2014. Huntsman pays 150 basis points above LIBOR to borrow under the facility. The bank loan carries Moody's Ba1 rating and Standard & Poor's BB+ rating. About Huntsman Headquartered in Salt Lake City, Utah, Huntsman Corporation (NYSE: HUN) -- http://www.huntsman.com/-- is a manufacturer of differentiated chemical products and inorganic chemical products. The company operates in four segments: Polyurethanes, Materials and Effects, Performance Products and Pigments. Its products are used in a range of applications, including those in the adhesives, aerospace, automotive, construction products, durable and non- durable consumer products, electronics, medical, packaging, paints and coatings, power generation, refining, synthetic fiber, textile chemicals and dye industries. Its Latin American operations are in Argentina, Brazil, Chile, Colombia, Guatemala, Panama and Mexico. * * * As reported by the Troubled Company Reporter on Dec. 18, 2008, Standard & Poor's Ratings Services kept its ratings on Huntsman Corp., including the 'BB-' corporate credit rating, on CreditWatch, where they were placed on June 26, 2007, with negative implications. S&P said: "This update follows Huntsman's announcement that it has terminated its merger agreement with Hexion Specialty Chemicals Inc. Under the terms of a settlement with Hexion and Apollo Management L.P., Huntsman expects to receive cash payments of $1 billion, consisting of $750 million of settlement payments and $250 million of cash proceeds from the issuance of 10-year convertible notes to Apollo affiliates, which Huntsman can repay in cash or common stock. The settlement payments consist of $325 million from a break-up fee due from Hexion, which Hexion will fund through an existing committed credit facility, and $425 million that Apollo affiliates will fund. At least $500 million of the payments are to be paid to Huntsman on or before Dec. 31, 2008. IMPLANT SCIENCES: Posts $2MM Net Loss in Quarter Ended Dec. 31 -------------------------------------------------------------- Implant Sciences Corporation posted a $2,061,000 net loss in the three months ended December 31, 2008, on total revenues of $1,519,000. Cost of revenues for the three months ended December 31, 2008 were $881,000 as compared with $408,000 for the comparable prior year period, an increase of $473,000 or 115.9%. The increase in cost of revenues is primarily a result of the increase in sales of security products and increase in government contract revenue and the associated direct expenses of the contracts. Gross margin for the three months ended December 31, 2008, was $638,000 or 42.0% of security revenues as compared with negative gross margin of $39,000 or (10.6%) of security revenues for the comparable prior year period. The increase in gross margin is a result of increased sales volume of the Company's handheld explosives detection equipment; design changes to its handheld explosives detectors which improved the manufacturability; and overall cost efficiencies realized in the production process, including efficiencies realized by its outsourced contract manufacturer. Research and development expense for the three months ended December 31, 2008 was $751,000 as compared with $663,000 for the comparable prior year period, an increase of $88,000 or 13.3%. Selling, general and administrative expenses for the three months ended December 31, 2008 was $1,561,000 as compared with $1,488,000 for the comparable prior year period, an increase of $73,000, or 4.9%. For the three months ended December 31, 2008, the Company recorded other expense, net of $416,000 as compared with other income, net of $320,000, for the comparable prior year period, an increase in other expense, net of $736,000. Loss from continuing operations for the three months ended December 31, 2008 was $2,090,000 as compared with $1,870,000 for the comparable prior year period, an increase of $220,000, or 11.8%. The increase in loss from continuing operations is primarily the result of the increase in interest expense and realization of unrealized loss of the Company's share of CardioTech's stock owned by CorNova; offset by increased sales of its handheld explosives detection product and improved gross margins resulting from these sales. Preferred distribution, dividends and accretion on the Series D Redeemable Convertible Preferred Stock for the three months ended December 31, 2008 was $18,000 as compared with $289,000 for the comparable prior year period, a decrease of $271,000 or 93.8%. Income from discontinued operations for the three months ended December 31, 2008 was $29,000 as compared with net loss from discontinued operations of $2,945,000 for the comparable prior year period, a decrease in loss from discontinued operations of $2,974,000. Net loss for the six months ended December 31, 2008 was $1,705,000, or $0.12 per share, as compared to $7,017,000, or $0.59 per share, for the comparable prior year period. Net loss for the three and six months ended December 31, 2007 included loss from discontinued operations of $2,945,000 and $3,582,000, respectively. As of December 31, 2008, the Company's cash position improved to $724,000 as compared to $412,000 as of June 30, 2008. The Company has approximately $200,000 cash as of today and will need to secure additional cash resources in the next 30 days. Glenn D. Bolduc, President and CEO of Implant Sciences, commented, "Our second quarter was a quarter of dynamic change where several important objectives were met, and which we believe set the stage for our future growth and success. We have completed the sale of substantially all business units and assets which are not strategic to our security business. As a result, the Company is now squarely focused on building its security business and offers investors a "pure-play" in security technology (or explosive detection). Due to our recent financing, we have eliminated our obligations to both Laurus and Bridge Bank. Our relocation into a modern facility should provide much needed operational efficiencies and cost-savings. The restructuring efforts executed in the second quarter left us with a highly qualified and effective team to execute on our ongoing growth strategy. "We believe that the growth in sales of our detection technology solutions, combined with our market research supports growing global demand for explosives trace detection equipment and technology. Our own recent business development activities indicate significant opportunities for sales of our existing handheld explosives detection equipment and soon to be announced air cargo screening products throughout the world. We have targeted Japan, Pakistan and India, in particular, which appear to have significant demand for handheld explosives detection equipment, estimated by us to be as much as $50 million over the next 12 to 18 months." Mr. Bolduc concluded, "While gratified at the successful accomplishments in our second quarter, we are mindful that there are significant challenges ahead. The Company will require capital to execute its business plan and is actively engaged in the pursuit of additional funding. The ongoing litigation with Evans Analytical Group, LLC is scheduled for trial in April 2009 and we hope this matter will soon be brought to its conclusion. However, in spite of the obstacles, we believe we have now put in place the right team to overcome the hurdles and take advantage of the growing worldwide opportunities to demonstrate the benefits of Implant Sciences' security solutions." The Company has suffered recurring losses from operations and must repay in full the balance of its senior secured convertible promissory note on December 10, 2009. The senior secured convertible promissory note was recorded at $3,436,000 as of December 31, 2008 and has a liquidation value of $4,600,000. "These conditions raise substantial doubt about the Company's ability to continue as a going concern," Glenn D. Bolduc, president, chief executive officer and chief financial officer, said. As of December 31, 2008, the Company's balance sheet showed total assets of $10,309,000, total liabilities of $9,686,000, and total stockholders' equity of $623,000. A full-text copy of the Company's quarterly report is available for free at: http://researcharchives.com/t/s?39ea Resignation In a separate regulatory filing, the Company disclosed that on February 20, 2009, Diane J. Ryan resigned as Implant Sciences Corporation's Vice President, Administration, Treasurer and Secretary for personal reasons. About Implant Sciences Wakefield, Massachusetts-based Implant Sciences Corporation (NYSE Alternext US: IMX) -- http://www.implantsciences.com/-- develops, manufactures and sells sophisticated sensors and systems for the Security, Safety and Defense industries. The Company has developed proprietary technologies used in its commercial portable and bench-top explosive trace detection systems which ship to a growing number of locations domestically and internationally. Going Concern Doubt UHY LLP on Oct. 14, 2008, expressed substantial doubt about Implant Sciences Corporation's ability to continue as a going concern after auditing the company's consolidated financial statements for the fiscal year ended June 30, 2008 and 2007. The auditing firm pointed to the company's recurring losses from operations. The Troubled Company Reporter reported on Feb. 9, 2009, that Implant Sciences Corporation received on Feb. 2, a notice from the NYSE Alternext US, LLC indicating that the Exchange intends to initiate proceedings to delist the Company's common stock. The Company has appealed this determination and requested an oral hearing before the Exchange's listing qualifications panel. INCENTRA SOLUTIONS: Bid Procedures Approved, Moves to Sell Assets ----------------------------------------------------------------- The Hon. Mary F. Walrath of the United States Bankruptcy Court for the District of Delaware to approve proposed bidding procedures for the sale of substantially all of assets of Incentra Solutions Inc. and its affiliated debtors, subject to competitive bidding and auction. The official committee of unsecured creditors of Incentra opposed the bid procedures. The panel said the procedures are not designed to generate the interest of other competing bidders, virtually assuring that Laurus Master Fund Ltd., the designated stalk-horse bidder for the Debtors' assets, will be able to purchase the assets for an inadequate price, the Committee asserted. According to the Troubled Company Reporter on Feb. 17, 2009, Laurus Master owns 6.9% of the common stock of Incentra Solutions. In addition, Laurus Master holds warrants and options excercisable at a nominal that would result in Laurus Masters' owing an additional 18.7% of the common stock of Incentra Solutions, if exercised. Laurus Master could purchase all of the Debtors assets by placing a credit bid. The asset purchase agreement provides that the credit bid amount consists of the prepetition and postpetition debt owed by the Debtors to Laurus Master including any and all accrued interest, fees, costs, expenses and other charges. The credit bid incorporates a facility payment of $200,000 and interest of $675,000 owed under the Debtors' request financing facility. The Debtors proposed that each bid for their assets must be accompanied by a good faith deposit in an amount equal to 10% of the purchase price. Bruce Grohsgal, Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware, said that the Debtors must obtain court approval of the sale by March 30, 2009, and closed by April 10, 2009, as required in the postpetition financing. The Debtors were allowed to access, on the interim, as much as $4.3 million in financing from Valens Offshore SPV II Corp. and Valens U.S. SPV I LLC, affiliates of Laurus Master. Pagemill Partners LLC will assist the Debtors in selling their assets to the highest bidder. A full-text copy of the Debtors' bidding procedures is available for free at: http://ResearchArchives.com/t/s?3981 A full-text copy of the Debtors' asset purchase agreement is available for free at: http://ResearchArchives.com/t/s?3982 About Incentra Solutions Headquartered in Boulder, Colorado, Incentra Solutions Inc. -- http://www.incentra.com-- provide information technology services. The company and seven of its affiliates filed for Chapter 11 protection on February 4, 2009 (Bankr. D. Del. Lead Case No. 09-10370). Bruce Grohsgal, Esq., at Pachulski, Stang, Ziehl Young & Jones, represents the Debtors in their restructuring efforts. Epiq Bankruptcy Solutions LLC serves as the Debtors' claims agent. Roberta A. DeAngelis, United States Trustee for Region 3, appointed five creditors to serve on an Official Committee of Unsecured Creditors. When the Debtors filed for protection from their creditors, the listed $92,494,615 in total assets and $80,301,104 in total debts. INDYMAC BANK: Inspector General Says OTC Failed to Act Fast ----------------------------------------------------------- According to an audit report of the Office of Inspector General of the Department of the Treasury, the primary causes of the failure of IndyMac Bank, FSB (IndyMac) of Pasadena, California, were largely associated with its business strategy of originating and securitizing Alt-A loans on a large scale. This strategy resulted in rapid growth and a high concentration of risky assets. From its inception as a savings association in 2000, IndyMac grew to the seventh largest savings and loan and ninth largest originator of mortgage loans in the United States. During 2006, IndyMac originated over $90 billion of mortgages. The report said that IndyMac's aggressive growth strategy, use of Alt-A and other nontraditional loan products, insufficient underwriting, credit concentrations in residential real estate in the California and Florida markets, and heavy reliance on costly funds borrowed from the Federal Home Loan Bank (FHLB) and from brokered deposits, led to its demise when the mortgage market declined in 2007. IndyMac often made loans without verification of the borrower's income or assets, and to borrowers with poor credit histories. Appraisals obtained by IndyMac on underlying collateral were often questionable as well. As an Alt-A lender, IndyMac's business model was to offer loan products to fit the borrower's needs, using an extensive array of risky option- adjustable-rate-mortgages (option ARMs), subprime loans, 80/20 loans, and other nontraditional products. Ultimately, loans were made to many borrowers who simply could not afford to make their payments. Regardless, the Material Loss Review of IndyMac Bank, FSB (OIG-09-032) thrift remained profitable as long as it was able to sell those loans in the secondary mortgage market. When home prices declined in the latter half of 2007 and the secondary mortgage market collapsed, IndyMac was forced to hold $10.7 billion of loans it could not sell in the secondary market. Its reduced liquidity was further exacerbated in late June 2008 when account holders withdrew $1.55 billion in deposits. This "run" on the thrift followed the public release of a letter from Senator Charles Schumer to the FDIC and Office of Thrift Supervision. The letter outlined the Senator's concerns with IndyMac. While the run was a contributing factor in the timing of IndyMac's demise, the underlying cause of the failure was the unsafe and unsound manner in which the thrift was operated. The Inspector General said that although OTS conducted timely and regular examinations of IndyMac and provided oversight through off-site monitoring, its supervision of the thrift failed to prevent a material loss to the Deposit Insurance Fund. The thrift's high-risk business strategy warranted more careful and much earlier attention. OTS viewed growth and profitability as evidence that IndyMac management was capable. Accordingly OTS continued to give the thrift high composite CAMELS ratings right up until shortly before it failed in 2008. "We found that OTS identified numerous problems and risks, including the quantity and poor quality of nontraditional mortgage products. However, OTS did not take aggressive action to stop those practices from continuing to proliferate. OTS had at times as many as 40 bank examiners involved in the supervision of IndyMac; however, the examination results did not reflect the serious risks associated with IndyMac's business model and practices. OTS examiners reported Matters Requiring Board Attention (MRBA) to the thrift, but did not ensure that the thrift took the necessary corrective actions. OTS also did not always report all problems found by the examiners, which were evident in the workpapers but not in the Reports of Examination (ROE). OTS relied on the cooperation of IndyMac management to obtain needed improvements. However, IndyMac had a long history of not sufficiently addressing OTS examiner findings. OTS did not issue any enforcement action, either informal or formal, until June 2008." In short, earlier enforcement action was warranted," the Inspector General said. "Our material loss review of IndyMac is the second such review we have performed of an OTS-regulated financial institution during the current financial crisis. In our first material loss review, of NetBank, FSB, we were critical of OTS for not taking stronger action when problems noted by examiners remained uncorrected through several examination cycles. We were also critical of OTS for delaying formal enforcement action after it had downgraded the thrift to a 3 in 2006. With IndyMac, OTS examiners reacted even slower in addressing issues that were more severe and with an institution that was nearly 10 times the size." According to the Inspector General, IndyMac engaged in very high- risk activities over many years, yet OTS's examiners did not downgrade the thrift from its 2 rating until early 2008 (except for a brief downgrade in 2001), and only after IndyMac started to incur substantial losses from the risky, non-conforming loan products it could no longer sell on the secondary market. "It is important to note that IndyMac did not even appear on OTS's problem thrift list provided to our office including the June 2008 list provided to us less than a month before the thrift was closed." "We believe that it is essential that OTS senior leadership reflect carefully on the supervision that was exercised over IndyMac and ensure that the correct lessons are taken away from this failure. In this regard, we recommend that the Director of OTS (1) ensure that action is taken on the lessons learned and recommendations from the OTS internal review of the IndyMac failure and (2) caution examiners that assigning composite CAMELS ratings of 1 or 2 to thrifts with high-risk, aggressive growth business strategies need to be supported with compelling, verified mitigating factors (such as thrift corporate governance, and risk management and underwriting controls) that are likely to be sustainable. OTS should examine and refine its guidance as appropriate." OTS Management Response In its management response, OTS agreed with the Inspector General's overall findings and recommendations and outlined a number of actions to address the identified shortcomings. OTS management also stated that the agency is committed to improve and strengthen its processes based on the lessons learned from the failure of IndyMac. Among the actions planned by OTS is establishing a large savings association unit in Washington, DC, that will be responsible for reviewing and concurring with regional office actions for savings associations with total assets above $10 billion. To ensure consistent, timely, and appropriate initiation and resolution of corrective actions, OTS stated that it plans to implement newly developed, uniform standards for review and approval of enforcement actions by its existing Regional Office Enforcement Review Committees. OTS also provided a chronological list of actions it is taking or plans to take to strengthen its supervisory process. OTS stated that it plans to issue during the first quarter of 2009 (1) external guidance to thrifts on the appropriate documentation, notification, and Thrift Financial Reporting requirements for capital contributions and (2) internal guidance to re-emphasize to examiners the importance of problem correction which will highlight existing requirements for using OTS examination systems to document corrective actions and supervisory follow-up. During the second quarter of 2009, OTS plans to work with the other federal bank regulatory agencies to revise and reissue interagency guidance to address liquidity monitoring. About Indymac Based in Pasadena, California, IndyMac Bancorp Inc. (NYSE:IMB) -- http://www.indymacbank.com/-- is the holding company for IndyMac Bank FSB, a hybrid thrift/mortgage bank that originated mortgages in all 50 states of the United States. Through its hybrid thrift- mortgage bank business model, IndyMac designed, manufactured, and distributing cost-efficient financing for the acquisition, development, and improvement of single-family homes. IndyMac also provided financing secured by single-family homes to facilitate consumers' personal financial goals and strategically invests in single-family mortgage-related assets. On July 11, 2008, the Office of Thrift Supervision closed IndyMac Bank and appointed FDIC as the bank's receiver. Thacher Proffitt & Wood LLP was engaged as counsel to the FDIC. Indymac Bancorp filed for Chapter 7 bankruptcy protection on July 31, 2008 (Bankr. C.D.Calif., Case No. 08-21752). Representing the Debtor are Dean G. Rallis, Jr., Esq., and John C. Weitnauer, Esq. Bloomberg noted that Indymac had about $32.01 billion in assets as of July 11, 2008. In court documents, IndyMac disclosed estimated assets of $50 million to $100 million and estimated debts of $100 million to $500 million. INSIGHT HEALTH: Dec. 31 Balance Sheet Upside Down by $148.3 Mil. ---------------------------------------------------------------- On February 17, 2009, InSight Health Services Holdings Corp. (OTCBB: ISGT) disclosed financial results for its second quarter ended December 31, 2008. As of December 31, 2008, the Company's balance sheet showed total assets of $195,978,000 and total liabilities of $344,261,000, resulting in total stockholders' deficit of $148,283,000. For the six months ended December 31, 2008, the Company posted a net loss of $14,003,000. InSight reported that revenues decreased 11.8% from approximately $67.0 million for the three months ended December 31, 2007, to approximately $59.1 million for the three months ended December 31, 2008. Revenues from fixed operations decreased approximately 16.5% from approximately $43.4 million for the three months ended December 31, 2007, to approximately $36.2 million for the three months ended December 31, 2008, principally due to sales of imaging centers. Revenues from mobile operations decreased approximately 3.2% from approximately $23.7 million for the three months ended December 31, 2007, to approximately $22.9 million for the three months ended December 31, 2008 principally due to a reduction in contractual rates upon contract renewals with certain customers. Revenues decreased approximately 9.3% from approximately $134.8 million for the six months ended December 31, 2007, to approximately $122.2 million for the six months ended December 31, 2008. Revenues from fixed operations decreased approximately 12.8% from approximately $86.5 million for the six months ended December 31, 2007, to approximately $75.4 million for the six months ended December 31, 2008 primarily due to sales of imaging centers. Revenues from mobile operations decreased approximately 3.0% from approximately $48.3 million for the six months ended December 31, 2007, to approximately $46.8 million for the six months ended December 31, 2008 mainly due to a reduction in contractual rates upon contract renewals with certain customers. Net cash provided by operating activities was approximately $9.1 million for the six months ended December 31, 2008 and resulted primarily from Adjusted EBITDA of approximately $21.1 million less approximately $13.1 million of cash paid for interest, offset by a net change in operating assets and liabilities of $1.4 million. At December 31, 2008, InSight had approximately $48.4 million in cash, cash equivalents and restricted cash -- including approximately $26.8 million that was subject to the lien for the benefit of the senior secured floating rate notes -- and approximately $17.6 million of availability under its revolving credit facility, based on its borrowing base. At December 31, 2008, there were no outstanding borrowings under the credit facility; however, there were letters of credit of approximately $2.2 million outstanding under the credit facility of which approximately $0.3 million were cash collateralized. Adjusted EBITDA decreased approximately 18.1% from approximately $11.3 million for the three months ended December 31, 2007, to approximately $9.3 million for the three months ended December 31, 2008 and decreased 16.8% from approximately $25.3 million for the six months ended December 31, 2007 to $21.1 million for the six months ended December 31, 2008. Adjusted EBITDA for the three months ended December 31, 2008 decreased 21.2% from approximately $11.8 million for the three months ended September 30, 2008. Adjusted EBITDA is defined as earnings before interest expense, income taxes, depreciation and amortization, excluding impairment of intangible assets, gain on sales of centers, reorganization items, net and gain on purchase of notes payable. Adjusted EBITDA has been included because InSight believes that it is a useful tool for it and its investors to measure its ability to provide cash flows to meet debt service, capital projects and working capital requirements. Adjusted EBITDA should not be considered an alternative to, or more meaningful than, income from company operations or other traditional indicators of operating performance and cash flow from operating activities determined in accordance with accounting principles generally accepted in the United States. InSight presents the discussion of Adjusted EBITDA because covenants in the agreements governing its material indebtedness contain ratios based on this measure. While Adjusted EBITDA is used as a measure of liquidity and the ability to meet debt service requirements, it is not necessarily comparable to other similarly titled captions of other companies due to differences in methods of calculations. A full-text copy of the Company's quarterly report is available for free at: http://researcharchives.com/t/s?39f0 About InSight Based in Lake Forest, California, InSight Health Services Holdings Corp. (OTCBB:ISGT) -- http://www.insighthealth.com/-- is a nationwide provider of diagnostic imaging services. It serves managed care entities, hospitals and other contractual customers in over 30 states, including these targeted regional markets: California, Arizona, New England, the Carolinas, Florida and the Mid-Atlantic states. InSight Health's network consisted of 109 fixed-site centers and 108 mobile facilities as of Dec. 31, 2006. The company and its affiliate, InSight Health Services Corp., filed for Chapter 11 protection on May 29, 2007 (Bankr. D. Del. Case Nos. 07-10700 and 07-10701). Daniel J. DeFranceschi, Esq., Jason M. Madron, Esq., and Mark D. Collins, Esq., at Richards, Layton & Finger, represent the Debtors. In schedules filed with the Court, Insight Health disclosed total assets of $87,102,870 and total debts of $525,448,053. Its debtor-affiliates, Insight Health Services, disclosed total assets of $505,285,296 and total debts of $525,500,934. Insight Health and its debtor-affiliates' pre-packaged Plan of Reorganization, which was confirmed by the U.S. Bankruptcy Court for the District of Delaware on July 10, 2007, became effective on Aug. 1, 2007. INTROGEN THERAPEUTICS: Wins Nod to Auction Off Equipment & Patents ------------------------------------------------------------------ Introgen Therapeutics Inc. won permission from the U.S. Bankruptcy Court for the Western District of Texas to auction off equipment and patents on April 7, Bloomberg's Bill Rochelle said. According to the report, bids are initially due March 20. The Court will convene a hearing to approve the sale on the same day the auction is scheduled. Introgen Therapeutics Inc. is a cancer-drug developer. Introgen Therapeutics filed for Chapter 11 on Dec. 3, 2008 (Bankr. W.D. Texas, Case No. 08-12442). Patricia Baron Tomasco, Esq., at Brown McCarroll, L.L.P., is the Company's bankruptcy lawyer. In its petition, the Company listed assets of $9,107,868 and debts of $12,932,950. IRIDIUM SATELLITE: Moody's Upgrades Corp. Family Rating to 'Ba3' ---------------------------------------------------------------- Moody's Investors Service upgraded Iridium Satellite LLC's corporate family rating to Ba3 from B2 and probability of default rating to Ba3 from B1, along with changes to the ratings of individual debt instruments as listed below. At the same time, Moody's revised Iridium's rating outlook to stable from developing while affirming the company's SGL-1 speculative grade liquidity rating (indicating very good liquidity). The upgrades reflect very strong operational performance characterized by steadily increasing revenues, EBITDA margins, and free cash flow generation that have resulted in very strong credit protection measures. At 30 September 2008, Iridium's Free Cash Flow/Debt and Debt/EBITDA leverage measures stood at approximately 30% and 1.8x, respectively (both measures as adjusted by Moody's). In turn, Iridium prepaid $22 million of outstanding debt under its 1st lien term loan facility in October 2008, which Moody's estimates has further improved Debt/EBITDA to approximately 1.4x. In addition, Iridium's revised Ba3 CFR reflects the likelihood that the pending merger transaction will close during the first half of 2009, at which time as per the terms of the agreement, a further $80 million of outstanding 1st lien debt will get repaid ($15 million repayment if the transaction does not proceed). Moody's notes that even if the transaction does not close, Iridium has sufficient cash flow generating capacity to repay all outstanding debt within a reasonably short time period (although the risk remains that this may not occur given the absence of mandatory triggers to affect the same). The Ba3 CFR is subsequently counterbalanced, in some respect, by the absence of any definitive statement from the company regarding debt repayment, as well as the lack of details regarding finalization and implementation of a plan to launch its next generation satellite constellation, "Iridium Next", which are still pending. The rating outlook is stable, reflecting expectations of stable financial and operational performance and Moody's belief that further upward ratings migration is unlikely in the near- to medium-term pending a clearly articulated feasible plan to replace its existing satellite constellation. Upgrades: Issuer: Iridium Satellite LLC -- Corporate Family Rating, Upgraded to Ba3 from B2 -- Probability of Default Rating, Upgraded to Ba3 from B1 -- Senior Secured Bank Credit Facility 1st Lien, Upgraded to Ba2 (LGD3, 35%) from B1 (LGD3, 37%) -- Senior Secured Bank Credit Facility 2nd Lien, Upgraded to B2 (LGD5, 87%) from B3 (LGD6, 95%) Outlook Actions: Issuer: Iridium Satellite LLC -- Outlook, Changed To Stable From Developing Moody's most recent rating action was on 6 October 2008, at which time Moody's changed Iridium's outlook to Developing from Stable while affirming its B2 CFR and SGL-1 liquidity rating. For additional commentary concerning the rating action, please refer to Moodys.com to review the related Credit Opinion (to be posted shortly following the date of this press release). Headquartered in Bethesda, Maryland, Iridium Satellite LLC is a mobile satellite services company that provides global telecommunication services to government and commercial customers. JOURNAL REGISTER: Targets July 1 Emergence from Chapter 11 ---------------------------------------------------------- Amidst reports of some newspapers putting out their last print issues, the solicitation of buyers for some papers in order to avert closure, and bankruptcy filings by other publishers, Journal Register Company expects to keep its business largely intact and emerge from bankruptcy as quickly as possible after exchanging debt to secured lenders for equity. Journal Register Company has filed a Chapter 11 plan of reorganization, based upon the product of negotiations with lenders pre-bankruptcy. JPMorgan Chase Bank, N.A. and lenders holding 77% of the aggregate principal amount of the indebtedness outstanding under the January 25, 2006 secured credit agreement have committed support to JRC's plan, which, among other things, provides zero recovery to holders of unsecured claims and owners of equity interests in JRC. Secured lenders will receive, among other things, 100% of the shares of new stock of JRC. The disclosure statement to the Plan says that the secured lenders are impaired, i.e., they are not getting full recovery on their claims. While unsecured creditors will not receive distributions under the plan, holders of trade unsecured claims that do not object to confirmation of the Plan will be eligible to receive payment of their Claims in full in cash from an account established by JPMorgan. The Plan Support Agreement, however, provides that, the Lenders will withdraw their support if: -- the explanatory disclosure statement is not approved by April 3, 2009. -- the Plan is not confirmed on or before June 3, 2009. -- the effective date of the Plan does not occur on or before July 1, 2009. James W. Hall, chairman of the board of directors, said that the Debtors hope to emerge from Chapter 11 as quickly as possible and intend to implement aspects of their operational restructuring. Beginning July 2008, in order to cut costs and increase liquidity, the Debtors closed many publications, downsize their labor force and sought cost-cutting initiatives that have led to lower operating expenses for the remaining publications. Just almost two weeks into its Chapter 11 cases, JRC has conveyed its intent to reject its collective bargaining agreements with four unions, if it fails to obtain consensual agreements by March 17. JRC has scheduled an April 1 hearing for the proposed rejections of the CBAs pursuant to Section 1113 of the Bankruptcy Code. The Debtors have also submitted a motion seeking approval of their Disclosure Statement in order to begin the confirmation process for their Plan. About Journal Register Yardley, Pennsylvania-based Journal Register Company (PINKSHEETS: JRCO) -- http://www.JournalRegister.com-- owns 20 daily newspapers, more than 180 non-daily publications and operates over 200 individual Web sites that are affiliated with the Company's daily newspapers, non-daily publications and its network of employment Web sites. All of the Company's operations are strategically clustered in six geographic areas: Greater Philadelphia; Michigan; Connecticut; Greater Cleveland; and the Capital-Saratoga and Mid-Hudson regions of New York. The Company also owns JobsInTheUS, a network of 20 employment Web sites. The Company, along with its affiliates, filed for Chapter 11 bankruptcy protection on February 21, 2009 (Bankr. S.D. N.Y. Case No. 09-10769). Marc Abrams, Esq., Rachel C. Strickland, Esq., Shaunna D. Jones, Esq., and Jennifer J. Hardy, Esq., at Willkie Farr & Gallagher LLP, assist the company in its restructuring effort. The company's financial advisor is Lazard Freres & Co.. Its restructuring advisor is Conway, Del Genio, Gries & Co., LLC. Robert P. Conway is the Company's chief restructuring officer. The Company listed $100 million to $500 million in total assets and $500 million to $1 billion in total debts. JOURNAL REGISTER: Gets Interim OK to Use Lenders' Cash Collateral ----------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York signed a stipulation and interim order that allows Journal Register Company to use cash pledged as collateral for its debt to lenders. The Court will convene a hearing on March 17, 2009, to consider final approval of the Debtors' use of the cash collateral. The Debtors will use cash solely in compliance with the cash flow forecast for the period February 20, 2009 to May 29, 2009. The budget forecasts that total receipts for that period will be $91,120,000. The Debtors are allowed to spend up to $88,416,000, including payment of $578,000 to The Associated Press, and $6,030,000 for advisor fees. A copy of the budget is available for free at: http://bankrupt.com/misc/JRC_Cash_Budget.pdf While the Court approved the Stipulation, a line -- that said the $695,175,145 owed to pre-bankruptcy secured lenders constitutes an allowed claim against JRC -- was deleted from the stipulation. Before filing for bankruptcy, JRC negotiated terms of a plan of reorganization with secured lenders. JPMorgan Chase Bank, N.A. and lenders holding 77% of the aggregate principal amount of the indebtedness outstanding under the January 25, 2006 secured credit agreement have committed support to JRC's plan. The Plan provides for no distribution or zero recovery to holders of unsecured claims and owners of equity interests in JRC. Secured lenders will receive, among other things, 100% of the shares of new stock of JRC. The disclosure statement to the Plan says that the secured lenders are impaired, i.e., they are not getting full recovery on their claims. About Journal Register Yardley, Pennsylvania-based Journal Register Company (PINKSHEETS: JRCO) -- http://www.JournalRegister.com-- owns 20 daily newspapers, more than 180 non-daily publications and operates over 200 individual Web sites that are affiliated with the Company's daily newspapers, non-daily publications and its network of employment Web sites. All of the Company's operations are strategically clustered in six geographic areas: Greater Philadelphia; Michigan; Connecticut; Greater Cleveland; and the Capital-Saratoga and Mid-Hudson regions of New York. The Company also owns JobsInTheUS, a network of 20 employment Web sites. The Company, along with its affiliates, filed for Chapter 11 bankruptcy protection on February 21, 2009 (Bankr. S.D. N.Y. Case No. 09-10769). Marc Abrams, Esq., Rachel C. Strickland, Esq., Shaunna D. Jones, Esq., and Jennifer J. Hardy, Esq., at Willkie Farr & Gallagher LLP, assist the company in its restructuring effort. The company's financial advisor is Lazard Freres & Co.. Its restructuring advisor is Conway, Del Genio, Gries & Co., LLC. Robert P. Conway is the company's chief restructuring officer. The company listed $100 million to $500 million in total assets and $500 million to $1 billion in total debts. JOURNAL REGISTER: Organizational Meeting to Form Panel on March 3 ----------------------------------------------------------------- Diana G. Adams, the United States Trustee for Region 2, will hold an organizational meeting on March 3, 2009, at 11:00 a.m. in the bankruptcy cases of The Journal Register Company and its affiliates. The meeting will be held at the Office of the United States Trustee, 80 Broad Street, 4th Floor, in Manhattan (Tel: (212) 510-0500). The sole purpose of the meeting will be to form a committee or committees of unsecured creditors in the Debtors' cases. The organizational meeting is not the meeting of creditors pursuant to Section 341 of the Bankruptcy Code. A representative of the Debtor, however, may attend the Organizational Meeting, and provide background information regarding the bankruptcy cases. To increase participation in the Chapter 11 proceeding, Section 1102 of the Bankruptcy Code requires that the United States Trustee appoint a committee of unsecured creditors as soon as practicable. The Committee ordinarily consists of the persons, willing to serve, that hold the seven largest unsecured claims against the debtor of the kinds represented on the committee. Section 1103 of the Bankruptcy Code provides that the Committee may consult with the debtor, investigate the debtor and its business operations and participate in the formulation of a plan of reorganization. The Committee may also perform other services as are in the interests of the unsecured creditors whom it represents. About Journal Register Yardley, Pennsylvania-based Journal Register Company (PINKSHEETS: JRCO) -- http://www.JournalRegister.com-- owns 20 daily newspapers, more than 180 non-daily publications and operates over 200 individual Web sites that are affiliated with the Company's daily newspapers, non-daily publications and its network of employment Web sites. All of the Company's operations are strategically clustered in six geographic areas: Greater Philadelphia; Michigan; Connecticut; Greater Cleveland; and the Capital-Saratoga and Mid-Hudson regions of New York. The Company also owns JobsInTheUS, a network of 20 employment Web sites. The company, along with its affiliates, filed for Chapter 11 bankruptcy protection on February 21, 2009 (Bankr. S.D. N.Y. Case No. 09-10769). Marc Abrams, Esq., Rachel C. Strickland, Esq., Shaunna D. Jones, Esq., and Jennifer J. Hardy, Esq., at Willkie Farr & Gallagher LLP, assist the company in its restructuring effort. The company's financial advisor is Lazard Freres & Co.. Its restructuring advisor is Conway, Del Genio, Gries & Co., LLC. Robert P. Conway is the company's chief restructuring officer. The company listed $100 million to $500 million in total assets and $500 million to $1 billion in total debts. KRONOS INTERNATIONAL: Moody's Junks Corp. Family Rating from 'B2' ----------------------------------------------------------------- Moody's Investors Service lowered Kronos International, Inc.'s Corporate Family Rating to Caa1 from B2, and the rating on the EUR400 million senior secured notes due 2013 to Caa2. The downgrade reflects expectations that KII will not generate positive free cash flow in the first half of 2009, KII's weak liquidity and the potential that the company will need to seek relief under its revolving credit facility's financial covenants. The ratings are under review for a possible downgrade. These summarizes the ratings changes: Ratings downgraded: Kronos International Inc. * Corporate family rating -- Caa1 from B2 * Probability of default rating -- Caa1 from B2 * EUR400 million 6.5% Sr Sec Notes due 2013 -- Caa2 (LGD5, 71%) from B3 (LGD5%, 72%) The downgrade reflects KII's weak liquidity that is not expected to improve materially in the near-term and the potential need for the company to renegotiate the financial covenants under its revolving credit facility. Continued weakness in the global titanium dioxide market (and in KII's main European TiO2 market in particular) and lower capacity utilization rates as a result of lower market demand and higher inventory levels will likely pressure KII's margins and cash flow. In the near-term, Moody's do not expect KII to generate positive free cash flow as potential pressure on selling prices, reduced capacity utilization rates, and lower volumes impact financial results. The outlook for the full year 2009 has not improved since the beginning of the year and remains very uncertain. The ratings assume no support from KII's parent or related entities, which could provide additional capital, however there has been no statement from the company that support will be forthcoming. KII is reliant on borrowings under its EUR80 million revolving credit facility to finance its operations. The facility has two financial covenants (Net Secured Debt/EBITDA not greater than 0.70:1.00 and Net Financial Debt / Equity not greater than 0.50:1.00) that are tested quarterly. Moody's expect weak EBITDA in late 2008 and early 2009 to further limit the amount available under the facility below the commitment level. The review for a possible downgrade primarily reflects the potential that the company will need to seek relief under its revolving credit facility's financial covenants, continuing uncertainty regarding 2009 performance and industry conditions, and the potential for a further decline in liquidity. The ratings could be further downgraded if the company experiences a further tightening of liquidity. The outlook could be changed to stable if a rebound in Europe bolsters TiO2 demand, KII's 2009 financial performance comes in line with at least that realized during the first nine months of 2008 and liquidity improves. Moody's most recent announcement concerning the ratings for KII was on January 15, 2009, when KII's rating was lowered to B2 from B1 on concerns over liquidity and weak industry conditions, and the outlook moved to negative. Kronos International, Inc. is a wholly owned subsidiary of Kronos Worldwide, Inc., headquartered in Dallas, Texas and produces and markets TiO2 pigments in Europe. For the LTM ended September 30, 2008, the company reported sales of $1.0 billion. LAKESIDE FUNDING: Fitch Cuts Rating on Liquidity Notes to 'B' ------------------------------------------------------------- Fitch Ratings downgraded the rating of the secured liquidity notes issued by Lakeside Funding LLC to 'B' from 'F1'. The Rating Outlook is Negative. The proceeds of the SLNs were used to purchase the class A-1 first priority senior secured notes (the Class A-1 Notes) issued by Lakeside CDO I, Ltd. and Lakeside CDO I, Inc. The action taken on the SLNs is the result of Fitch downgrading the class A-1 notes to 'BB' Outlook Negative from 'AAA' on Feb. 25, 2009. The rating action is a result of negative credit migration in the portfolio and incorporates Fitch's recently adjusted default and recovery rate assumptions for analyzing structured finance collateralized debt obligations. Lakeside entered into a put agreement with AIG Financial Products whose payment obligations are absolutely and unconditionally guaranteed by American International Group (rated 'A/F1' by Fitch). If an event of default occurs in connection with the payment of interest and principal from the Class A-1 Notes, AIG-FP is not obligated to fund. LAMAR ADVERTISING: S&P Downgrades Corporate Credit Rating to 'B+' ----------------------------------------------------------------- Standard & Poor's Ratings Services lowered its corporate credit and issue-level ratings on Lamar Advertising Co. and Lamar Media Corp. by one notch. The corporate credit rating was lowered to 'B+' from 'BB-'. The rating outlook is negative. In addition, S&P revised the recovery rating on Lamar Media's subordinated debt to '4', indicating S&P's expectation of average (30% to 50%) recovery for lenders in the event of a payment default, from '3'. The issue-level rating these securities was lowered to 'B+' (at the same level as the 'B+' corporate credit rating) from 'BB-'. "The downgrade reflects continued weakening in the U.S. economy and its impact on S&P's expectation for 2009 revenue and EBITDA at Lamar," said Standard & Poor's credit analyst Ariel Silverberg. The previous 'BB-' rating incorporated S&P's expectation that 2009 EBITDA would decrease in the mid-teens percentage area. As a result of a continued pullback in advertising demand, which S&P expects to pressure occupancy and pricing for Lamar's inventory throughout 2009, S&P expects 2009 revenue and EBITDA to decline in the mid-teens percentage and high-20% areas, respectively. S&P believes this will result in a violation in Lamar's 6.0x debt to EBITDA covenant under its senior secured credit facility in the second half of 2009, and a weakening in S&P's lease-adjusted credit measures for the company. Even through S&P expects Lamar will violate its covenant, S&P believes lenders would provide temporary relief and amend it; however, pricing under the facility will likely increase meaningfully. As a result of lower EBITDA and higher costs for the amended facility, EBITDA coverage of interest at the end of 2009 would likely fall to around 1.75x (on an annual pro forma basis), and lease-adjusted leverage would likely increase to the 8.0x area. Both measures would be weak for the current 'B+' rating. At Dec. 31, 2008, lease-adjusted debt to EBITDA was 6.7x, and interest coverage was 2.7x. The rating on Baton Rouge, La.-headquartered Lamar Advertising and Lamar Media is based on the consolidated creditworthiness of the parent, Lamar Advertising. The rating reflects the company's high debt leverage and weakening adjusted credit measures, and an aggressive financial policy. This is somewhat tempered by Lamar's good position in the small-to-midsize outdoor advertising industry, S&P's expectation that Lamar is likely to get temporary covenant relief from its lenders later this year, and S&P's expectation for positive discretionary cash flow in 2009. LAND O'LAKES: Moody's Affirms Corporate Family Rating at 'Ba1' -------------------------------------------------------------- Moody's Investors Service affirmed the ratings of Land O'Lakes, Inc., including the company's corporate family and probability of default ratings at Ba1, and its speculative grade liquidity rating at SGL-3. The affirmation of the ratings follows Land O'Lakes' announcement that it had obtained an unqualified opinion from its independent registered public accounting firm for its consolidated financial statements for fiscal years 2007 and 2008. The rating outlook is stable. Ratings affirmed; certain LGD percentages and ratings revised: * Corporate family rating at Ba1 * Probability of default rating at Ba1 * $225 million senior secured revolving credit at Baa3 (LGD2); LGD% to 20% from 22% * $175 million 9% senior secured second lien debt at Baa3; LGD assessment toLGD2/ 29% from LGD3/34% * Senior unsecured notes at Ba2 (LGD4); LGD % to 68% from 69% * Speculative grade liquidity rating at SGL-3 Land O'Lakes Capital Trust I * $191 million 7.45% capital securities to Ba2 (LGD6,95%) In November 2008, Land O'Lakes announced that cost of goods sold in its Agronomy segment in the September 2008 quarter had been understated by $10.1 million as a result of errors in inventory costing. In addition to this accounting error, Land O'Lakes disclosed certain issues with its MoArk LLC subsidiary that contributed to material weakness in internal controls over financial reporting. These issues eventually led to KPMG LLP, the auditor for the consolidated company, to withdraw its auditors' report on the consolidated financials from fiscal 2005 through 2007. The recent receipt of unqualified opinions from KPMG on the consolidated financials for fiscal 2007 and 2008 should allow Land O'Lakes to file its 10K for fiscal 2008 on or before the March 31, 2009 deadline, avoiding the need to enter the grace period for financial statement distribution in various debt instruments and averting a potential technical default. Land O'Lakes has made a number of accounting adjustments in a fairly short time period. While the amounts involved have been modest, these adjustments do raise concerns about the quality of financial oversight of acquired subsidiaries and former joint ventures. The affirmation of the company's ratings is based on Moody's expectation that the company's solid market positions will allow Land O'Lakes to successfully pass along input costs, generally preserving profitability and what are strong credit metrics for its rating category. Land O'Lakes' financial policy has demonstrated a commitment to debt reduction, by applying proceeds from asset sales to improving leverage. Despite the 2007 acquisition of the crop production business from its Agriliance joint venture, reported debt at the end of fiscal 2008 was below the level at the end of fiscal 2003. Nonetheless, Moody's anticipates that Land O'Lakes may be challenged to materially cut debt balances from operating cash flow in the near term and reduce what is already fairly low leverage. Margins were hurt in the recent fourth quarter by the impact of declining commodity prices that led to narrower margins, inventory write-downs and unrealized hedging losses. The hedging losses will likely be offset as hedges expire. Moody's expects that financial condition will remain stable given that many of the company's products are staples for consumers or for the agricultural industry. The company's speculative grade liquidity rating of SGL-3 reflects Moody's anticipation that working capital needs, from the full absorption of the Agriliance crop protection business, and potentially softer margins in the near term will likely result in reliance on its $225 million senior secured revolving credit facility expiring in August 2011 and its $400 million receivables securitization facility expiring in September 2011. Excess availability under committed credit facilities is nonetheless expected to be adequate at peak. The cooperative is anticipated to maintain quite ample cushion under its financial covenants. Land O'Lakes' assets are encumbered, limiting alternative sources of liquidity, although it could sell discrete businesses without affecting remaining operations. Moody's most recent rating action for Land O'Lakes on July 9, 2008, upgraded the company's corporate family rating, probability of default rating, and second lien debt rating; upgraded the debt rating for Land O'Lakes Capital Trust I; affirmed the ratings on Land O'Lakes revolving credit and unsecured notes; downgraded its speculative grade liquidity rating to SGL-3; and assigned a stable outlook. Land O'Lakes, Inc., based in Arden Hills, Minnesota, is an agricultural cooperative focusing on dairy food, animal feed, and agricultural crop inputs. Revenues for the fiscal year ended December 31, 2008 were approximately $12 billion. LEAR CORP: Bank Loan Continues Slide; Trades at Almost 66% Off -------------------------------------------------------------- Participations in a syndicated loan under which Lear Corp. is a borrower traded in the secondary market at 34.57 cents-on-the- dollar during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. This represents a drop of 3.99 percentage points -- at 38.56 cents-on-the-dollar -- from the previous week, the Journal relates. The loan matures March 29, 2012. Lear pays 250 basis points above LIBOR to borrow under the facility. The bank loan is not rated. Syndicated loans of other auto parts makers also slid in secondary market trading during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. Investors avoided TRW Automotive and Visteon Corp. bank debt. Participations in a syndicated loan under which TRW Automotive is a borrower traded in the secondary market at 57.20 cents-on-the- dollar, a drop of 7.13 percentage points -- at 64.33 cents-on-the- dollar -- from the previous week. TRW Automotive pays 150 basis points to borrow under the facility. The bank loan carries Moody's Ba1 rating and Standard & Poor's BBB- rating. Visteon Corp. bank debt continued its slide, trading in the secondary market at 17.71 cents-on-the-dollar during the week ended February 27, 2009. This represents a drop of 2.50 percentage points -- at 20.21 cents-on-the-dollar -- from the previous week. The loan matures May 30, 2013. Visteon pays 300 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B3 rating and Standard & Poor's B- rating. Dana Corporation bank debt traded in the secondary market at 30.43 cents-on-the-dollar. This represents a drop of 2.97 percentage points -- at 33.40 cents-on-the-dollar -- from the previous week. The loan matures January 31, 2015. Dana pays 375 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B3 rating and Standard & Poor's B+ rating. Avis Budget Car Rental LLC bank debt traded at 37.80 cents-on-the- dollar, a drop of 3.92 percentage points from the previous week. The loan matures April 1, 2012. Avis Budget pays 125 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's Ba3 rating and Standard & Poor's B rating. Hertz Corporation bank debt traded at 65.85 cents-on-the-dollar, a decrease of 2.37 percentage points from the previous week. The loan matures on December 21, 2012. Hertz pays 150 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's Ba1 rating and Standard & Poor's BB+ rating. About Lear Corp. Based in Southfield, Michigan, Lear Corp. is a global automotive supplier, conducting business in two product operating segments: seating and electrical and electronic. The seating segment includes seat systems and the components. The electrical and electronic segment includes electrical distribution systems and electronic products, primarily wire harnesses, junction boxes, terminals and connectors, various electronic control modules, as well as audio sound systems and in-vehicle television and video entertainment systems. The assembly process with respect to the electrical and electronic segment is performed in low-cost labor sites in Mexico, Honduras, the Philippines, Eastern Europe and Northern Africa. Lear has divested substantially all of the assets of its interior segment, which included instrument panels and cockpit systems, headliners and overhead systems, door panels, flooring and acoustic systems and other interior products. * * * As reported by the Troubled Company Reporter on Jan. 9, 2009, Moody's Investors Service lowered the Corporate Family and Probability of Default ratings of Lear Corporation, to Caa2 from B3. In a related action, the rating of the senior secured term loan was lowered to Caa1 from B2, and the rating on the senior unsecured notes was lowered to Caa2 from B3. The ratings remain on review for further possible downgrade. According to the TCR on Jan. 15, 2009, Standard & Poor's Ratings Services said it lowered its corporate credit rating on Southfield, Michigan-based Lear Corp. to 'B-' from 'B'. At the same time, S&P also lowered its issue-level ratings on the company's debt. The ratings remain on CreditWatch, where they had been placed with negative implications on Nov. 13, 2008. LEHMAN BROTHERS: Wants to Let Insurers Pay for Execs. Legal Fees ---------------------------------------------------------------- Lehman Brothers Holdings Inc., and its affiliates ask the U.S. Bankruptcy Court for the Southern District of New York to grant relief from the automatic stay provided for in section 362(a) of the Bankruptcy Code, to the extent that it applies, to allow payments or advancements by various primary insurers of defense costs that are, or will become, owing to former directors and officers. Richard P. Krasnow, Esq., at Weil, Gotshal & Manges LLP, says that the purpose of the Motion is to remove any impediments to the ability of the Debtors' third party insurers to immediately commence payment of the outstanding and ongoing defense costs and fees that current or former directors and officers of the Debtors' as well as certain employees, fiduciaries, and administrators of LBHI's sponsored employee benefit plans under the Employee Retirement Income Security Act of 1974 have incurred and are incurring as defendants in ongoing federal securities lawsuits, regulatory and other investigations, and an ERISA class action litigation. According to Mr. Krasnow, the Debtors' various primary insurers have expressed a willingness to pay previously incurred defense costs and fees and advance defense costs and fees to such insured individuals consistent with the terms of the relevant insurance policies, but only upon entry of an order by the Court. Confirming the insurers' ability to pay such defense costs and fees is in the best interests of the Debtors' estate and creditors because, inter alia, it will avoid the possible collateral estoppel effect on the Debtors that could result if the individuals' inability to defend themselves were to give rise to judgments and findings that impacted direct claims against the Debtors, Mr. Krasnow explains. He adds that if the Motion is granted, it would relieve the Debtors' estates of the potentially significant burden of claims that may otherwise be asserted by the individual insureds in the absence of such relief. Furthermore, according to Mr. Krasnow, the interests of the Debtors' estates, if any, in the proceeds of the applicable insurance policies is expressly subordinate to the interest of the individual insureds. Specifically, the applicable insurance policies provide that the Debtors' have a right to the insurance proceeds only after the insured individuals are fully reimbursed for any "Loss," including defense costs. The Motion is due for hearing March 25, 2009 at 10:00 a.m. (Prevailing Eastern Time). Objections are due March 20 at 4:00 p.m. (Prevailing Eastern Time). 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 US$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. Lehman Brothers Finance AG, also known as Lehman Brothers Finance SA, filed a petition under Chapter 15 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court in Manhattan on February 10, 2009. Lehman Brothers Finance, a subsidiary of Lehman Brothers Inc., listed estimated assets of more than US$1 billion and estimated liabilities of more than US$1 billion. 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 US$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. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEHMAN BROTHERS: Wants to Keep Foreign Accounts, Invest $6-Bil. --------------------------------------------------------------- Lehman Brothers Holdings Inc., and its affiliates ask the U.S. Bankruptcy Court for the Southern District of New York for permission to keep $820 million in foreign banks, and allow them to invest $6 billion in excess cash in interest-bearing accounts. The proposal is due for hearing on March 11, with objections due March 6. Richard P. Krasnow, Esq., at Weil, Gotshal & Manges LLP, relates that since Lehman's bankruptcy filing, the Debtors and their professionals have been working diligently to come into compliance with the requirements under Section 345 of the Bankruptcy Code and the guidelines of the office of the United States Trustee for the Southern District of New York by, among other things, closing deposit accounts at banks that are not recognized as authorized depositories. The Debtors currently maintain in excess of $6 billion in authorized depositories. $820-Million in Foreign Banks Lehman, as an international investment bank, regularly purchased and sold assets and transacted other business around the world. Lehman funded these transactions and deposited the proceeds thereof into various deposit accounts established with domestic and foreign financial institutions. Lehman continues to receive remittances in foreign currencies and incur operating expenses and other transactions cost in foreign countries that are payable in local currency. The Debtors maintain approximately $820 million in these unauthorized depository accounts, Mr. Krasnow relates. While they wind down of their businesses, the Debtors propose to keep these accounts for the purpose of funding these expenses and to avoid possible adverse tax consequences and the cost associated with converting the currencies into U.S. dollars and then back into local currency. The majority of these accounts are denominated in foreign currencies and deposited with foreign banks. The Debtors are in the process of closing and repatriating the funds in the other Unauthorized Accounts that are denominated in U.S. dollars. $6-Bil. to Interest Bearing Accounts Now that their operations are stabilized, the Debtors propose to implement investment guidelines to invest their excess cash resulting from the operation of their businesses, various asset sales, and other transactions. The flow of money into the Debtors' estates from these and other activities has resulted in a current cash balance that exceeds $6 billion. Given their sizeable cash position and the likelihood that more funds will continue to be generated, the Debtors seek authority to invest their excess cash in investments that are fully backed by the United States government or those that have an acceptable risk and also provide the Debtors with a reasonable return on the investments. Mr. Krasnow relates that nearly all of the Debtors' Authorized Depository Accounts are demand deposit accounts -- accounts that are fully guaranteed, but not earning interest. On the other hand, interest-bearing accounts are not fully guaranteed by the U.S. government. Given the constraints under Section 345 and the UST Guidelines, unless the depository bank has a sufficient amount of capital or posts sufficient collateral, the Debtors cannot keep cash in interest bearing accounts. According to Mr. Krasnow, only one of the Debtors' Authorized Depositories has agreed to post sufficient collateral that will allow the Debtors to deposit their excess cash in interest bearing accounts. The other banks either do not have sufficient capital or are unwilling to post collateral. The Debtors have carefully scrutinized a number of potential investments and have determined, in the exercise of their business judgment, that it is in the best interest of the Debtors, their estates, and all creditors to invest their excess cash in: -- U.S. guaranteed investments, -- U.S. treasury based money market funds, and -- foreign investments Investments in U.S. government securities are fully guaranteed. Obligations of the U.S. government include (i) the direct purchase of bills, bonds, notes, and other obligations issued by the United States Federal Treasury, and (ii) Federal agency securities, such as "Freddie Mac" and "Ginnie Mae." While the money market funds are not insured by the U.S. government or the Federal Deposit Insurance Corporation, the Debtors believe the treasury-based money market funds are safe because the money market fund's value is based solely on U.S. government obligations that are fully guaranteed. The Debtors propose to invest the excess cash in their foreign Unauthorized Depository Accounts in low-risk investments such as securities issued by foreign governments, interest bearing accounts, bank-issued certificates of deposit, or funds similar to the treasury-based money market funds. The Debtors seek authority to invest overseas temporarily to generate a return on the cash the Debtors need to keep abroad. 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 US$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. Lehman Brothers Finance AG, also known as Lehman Brothers Finance SA, filed a petition under Chapter 15 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court in Manhattan on February 10, 2009. Lehman Brothers Finance, a subsidiary of Lehman Brothers Inc., listed estimated assets of more than US$1 billion and estimated liabilities of more than US$1 billion. 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 US$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. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEVEL 3: Bank Loan Sells at 26% Off in Secondary Market ------------------------------------------------------- Participations in a syndicated loan under which Level 3 Communications is a borrower traded in the secondary market at 73.83 cents-on-the-dollar during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. This represents a drop of 1.77 percentage points from the previous week, the Journal relates. The loan matures March 1, 2014. Level 3 pays 225 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B1 rating and Standard & Poor's B+ rating. About Level 3 Communications Headquartered in Broomfield, Colorado, Level 3 Communications Inc. (Nasdaq: LVLT) -- http://www.level3.com/-- is a provider of fiber-based communications services. Level 3 offers a portfolio of metro and long haul services over an end-to-end fiber network, including transport, data, Internet, content delivery and voice. At Dec. 31, 2008, the company's balance sheet showed total assets of $9.63 billion, total liabilities of $8.76 billion and stockholders' equity of $876 million. * * * As reported in the Troubled Company Reporter on Jan. 12, 2009, Moody's Investors Service adjusted Level 3 Communications, Inc.'s probability of default rating to Ca/LD subsequent to the company completing tender offer transactions that were interpreted, for ratings purposes (and as was contemplated in Moody's November 24, 2008 press release that addressed the ratings' impact of the tender offer), as constituting a distressed exchange that is tantamount to a default. As was then noted, the PDR will be temporarily repositioned to Ca/LD to reflect the limited default that has occurred; the PDR will be repositioned (back to Caa1, under review for downgrade) after three business days. LEXINGTON PRECISION: Plan Filing Period Extended to April 27 ------------------------------------------------------------ The U.S. Bankruptcy Court for the Southern District of New York extended until April 27, 2009, Lexington Precision Corp. and Lexington Rubber Group, Inc.'s exclusive period to propose a plan. The Debtors' exclusive period to solicit acceptances of a plan was extended to June 25, 2009. As previously disclosed, the Debtors said they will use the extension to consolidate and restructure their connector seals business. The Debtors explained that without the consolidation of the connector seals business, it is unlikely that they would be able to obtain a commitment for exit financing sufficient to fund the payments required under their Chapter 11 Plan, as twice amended, and to provide adequate working capital for the business. About Lexington Precision Headquartered in New York, Lexington Precision Corp. -- http://www.lexingtonprecision.com/-- manufactures tight- tolerance rubber and metal components for use in medical, automotive, and industrial applications. As of Feb. 29, 2008, the Company employed about 651 regular and 22 temporary personnel. The Company and its affiliate, Lexington Rubber Group Inc., filed for Chapter 11 protection on April 1, 2008 (Bankr. S.D.N.Y. Lead Case No.08-11153). Christopher J. Marcus, Esq., and Victoria Vron, Esq., at Weil, Gotshal & Manges, represent the Debtors in their restructuring efforts. The Debtors selected Epiq Systems - Bankruptcy Solutions LLC as claims agent. The U.S. Trustee for Region 2 appointed six creditors to serve on an Official Committee of Unsecured Creditors. Paul N. Silverstein, Esq., and Jonathan Levine, Esq., at Andrews Kurth LLP, represent the Committee as counsel. At December 31, 2008, the Debtors had total assets of $53,354,000, total liabilities of $100,061,000, and a stockholders' deficit of $46,707,000. LYONDELL CHEMICAL: $8-Bil. DIP Loan Approved on Final Basis ----------------------------------------------------------- The United States Bankruptcy Court for the Southern District of New York has approved the terms of Lyondell Chemical Company's debtor-in-possession financing package. This action will allow the company access to an additional $1.083 billion of the DIP financing and will make an additional euro 260 million available to LyondellBasell entities that are organized outside of the United States. The DIP financing includes two credit agreements: (1) a $6.5 billion term loan (comprising $3.25 billion in new loans and a $3.25 billion roll-up of existing loans); and (2) a $1.54 billion asset-backed lending facility. On Jan. 8, the company received interim authorization to use up to $3.682 billion of its DIP funding, including euro 440 million for LyondellBasell's non-U.S. entities. The DIP lenders include a combination of banks and investment firms, such as hedge funds and private equity firms. "These funds will support the uninterrupted operation of our businesses worldwide, giving confidence to our many suppliers and allowing us to continue serving the needs of our global customers," said Volker Trautz, chief executive officer of LyondellBasell Industries. "This final approval of our DIP credit agreements means that we can turn our full attention to the task of emerging from Chapter 11 protection with a new capital structure and a strengthened business platform." About Lyondell Chemical Basell AF and Lyondell Chemical Company merged operations in 2007 to form LyondellBasell Industries -- http://www.lyondellbasell.com/-- the world's third largest independent chemical company. Lyondellbasell produces polypropylene and advanced polyolefins products, is a leading supplier of polyethylene, and a global leader in the development and licensing of polypropylene and polyethylene processes and related catalyst sales. LyondellBasell became saddled with debt as part of the US$12.7 billion merger. About a year after completing the merger, LyondellBasell Industries' U.S. operations and one of its European holding companies -- Basell Germany Holdings GmbH -- filed voluntary petitions to reorganize under Chapter 11 of the U.S. Bankruptcy Code on January 6, 2009, to facilitate a restructuring of the company's debts. The case is In re Lyondell Chemical Company, et al., Bankr. S.D. N.Y. Lead Case No. 09-10023). Seventy-nine Lyondell entities, including Equistar Chemicals, LP, Lyondell Chemical Company, Millennium Chemicals Inc., and Wyatt Industries, Inc., filed for Chapter 11. LyondellBasell is not part of the bankruptcy filing. LyondellBasell's non-U.S. operating entities are also not included in the Chapter 11 filing. The Hon. Robert E. Gerber presides over the case. Deryck A. Palmer, Esq., at Cadwalader, Wickersham & Taft LLP, in New York, serves as the Debtors' bankruptcy counsel. Evercore Partners serves as financial advisors, and Alix Partners and its subsidiary AP Services LLC, serves as restructuring advisors. AlixPartners' Kevin M. McShea acts as the Debtors' Chief Restructuring Officer. Clifford Chance LLP serves as restructuring advisors to the European entities. Lyondell Chemical estimated that consolidated assets total US$27.12 billion and debts total US$19.34 billion as of the bankruptcy filing date. Bankruptcy Creditors' Service, Inc., publishes Lyondell Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Lyondell Chemical Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LYONDELL CHEMICAL: US Judge Gives Parent Time to File or Negotiate ------------------------------------------------------------------ Lyondell Chemical Co. announced Thursday that Judge Robert Gerber of the U.S. Bankruptcy Court for the Southern District of New York has issued an injunction that bars creditor against its parent LyondellBasell Industries AF SCA, on account of its failure to pay interest on 8.375 percent senior notes of 2015. According to Bloomberg's Bill Rochelle, Judge Gerber's 38-page opinion said that creditors are barred for 60 days from pursuing actions against LBIAF, including sending it to involuntary bankruptcy. Lyondell Chemical had requested for the injunction, saying that an involuntary bankruptcy filing by its parent would cause a default on its $8-billion debtor-in-possession loan. Judge Gerber declined to grant permanent injunction against noteholders' actions against non-debtor LBIAF and other units not among the Lyondell entities that sought Chapter 11 protection. According to the report, the judge said that giving Lyondell all it wanted would "represent an excessive exercise of the power that I undoubtedly have." Judge Gerber said that two months is long enough for the parent to either (i) file "voluntary insolvency proceedings in the U.S. or abroad.", or (ii) negotiate a "consensual workout or restructuring" of the parent's debt. Judge Gerber, according to Mr. Rochelle, also pointed out that noteholders' claims are subordinated to claims of senior creditors. Consequently, Judge Gerber said, the noteholders will see a recovery only if the subsidiaries' creditors are fully paid. Disrupting the subsidiaries' reorganizations in the U.S. wouldn't end up helping the noteholders, Judge Gerber concluded. About Lyondell Chemical Basell AF and Lyondell Chemical Company merged operations in 2007 to form LyondellBasell Industries -- http://www.lyondellbasell.com/-- the world's third largest independent chemical company. Lyondellbasell produces polypropylene and advanced polyolefins products, is a leading supplier of polyethylene, and a global leader in the development and licensing of polypropylene and polyethylene processes and related catalyst sales. LyondellBasell became saddled with debt as part of the US$12.7 billion merger. About a year after completing the merger, LyondellBasell Industries' U.S. operations and one of its European holding companies -- Basell Germany Holdings GmbH -- filed voluntary petitions to reorganize under Chapter 11 of the U.S. Bankruptcy Code on January 6, 2009, to facilitate a restructuring of the company's debts. The case is In re Lyondell Chemical Company, et al., Bankr. S.D. N.Y. Lead Case No. 09-10023). Seventy-nine Lyondell entities, including Equistar Chemicals, LP, Lyondell Chemical Company, Millennium Chemicals Inc., and Wyatt Industries, Inc., filed for Chapter 11. LyondellBasell is not part of the bankruptcy filing. LyondellBasell's non-U.S. operating entities are also not included in the Chapter 11 filing. The Hon. Robert E. Gerber presides over the case. Deryck A. Palmer, Esq., at Cadwalader, Wickersham & Taft LLP, in New York, serves as the Debtors' bankruptcy counsel. Evercore Partners serves as financial advisors, and Alix Partners and its subsidiary AP Services LLC, serves as restructuring advisors. AlixPartners' Kevin M. McShea acts as the Debtors' Chief Restructuring Officer. Clifford Chance LLP serves as restructuring advisors to the European entities. Lyondell Chemical estimated that consolidated assets total US$27.12 billion and debts total US$19.34 billion as of the bankruptcy filing date. Bankruptcy Creditors' Service, Inc., publishes Lyondell Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Lyondell Chemical Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) MAGNA ENTERTAINMENT: PNC Bank Declares Event of Default ------------------------------------------------------- Magna Entertainment Corp. said Friday it has received written notice from its lenders that Pimlico Racing Association, Inc., Laurel Racing Association Limited Partnership, Laurel Racing Assoc., Inc. and The Maryland Jockey Club of Baltimore City, Inc., each a subsidiary of MEC, are in default under the PNC Bank, National Association loan agreement for failure to comply with certain financial covenants relating to the financial position and results of operation of MJC and related entities. PNC Bank has informed MEC that it has chosen not to exercise its rights and remedies under such loan agreement at this time as a consequence of this event of default, but may choose to do so at any time in the future without any further written notice. In addition, MEC has previously notified Wells Fargo Bank, National Association and a Canadian chartered bank with which MEC has a US$40 million credit facility that MEC or certain of its subsidiaries have not met certain financial covenants of the loan agreements with such lenders. To date, such lenders have not exercised their default-related rights under their respective loan agreements. On February 25, 2009, Magna Entertainment said Mr. Anthony Campbell has stepped down as a director of MEC, effective immediately. Frank Stronach, Chairman and Chief Executive Officer of MEC, said "Tony has our gratitude and best wishes for success in all his future endeavors." About Magna Entertainment Based in Aurora, Ontario, Magna Entertainment Corp. (MECA) is North America's largest owner and operator of horse racetracks, based on revenue. The Company develops, owns and operates horse racetracks and related pari-mutuel wagering operations, including off-track betting facilities. MEC also develops, owns and operates casinos in conjunction with its racetracks where permitted by law. MEC owns and operates AmTote International, Inc., a provider of totalisator services to the pari-mutuel industry, XpressBet(R), a national Internet and telephone account wagering system, as well as MagnaBet(TM) internationally. Pursuant to joint ventures, MEC has a fifty percent interest in HorseRacing TV(R), a 24-hour horse racing television network, and TrackNet Media Group LLC, a content management company formed for distribution of the full breadth of MEC's horse racing content. At Sept. 30, 2008, the company's balance sheet showed total assets of $1.1 billion, total liabilities of $891.0 million and shareholders' equity of $272.7 million. * * * As reported in the Troubled Company Reporter on March 20, 2008, Ernst & Young LLP in Toronto, Canada, expressed substantial doubt about Magna Entertainment Corp.'s ability to continue as a going concern after auditing the company's consolidated financial statements for the years Dec. 31, 2007, and 2006. The auditing firm pointed to the company's recurring operating losses and working capital deficiency. The TCR said on February 19, 2009, that MI Developments Inc., the Company's controlling shareholder, has determined not to proceed with its reorganization proposal, which includes the spin-off of MEC to MID's existing shareholders. In accordance with the terms of certain of MEC's loan agreements, the maturity date of the first tranche of the new loan that a subsidiary of MID made available to MEC on December 1, 2008, in connection with the reorganization proposal, the maturity date of the bridge loan from MID Lender and the deadline for repayment of US$100 million under the Gulfstream project financing facility from MID Lender has been accelerated to March 20, 2009. The maturity date of the second tranche of the New Loan has already been accelerated to May 13, 2009. As of February 18, 2009, there is roughly US$48.5 million outstanding under the first tranche of the New Loan, roughly US$0.7 million outstanding under the second tranche of the New Loan and roughly US$126.2 million outstanding under the bridge loan. In accordance with its terms, the maturity date of MEC's US$40 million credit facility with a Canadian chartered bank will also accelerate to March 5, 2009. If MEC is unable to repay its obligations when due or satisfy required covenants in its loan agreements, substantially all of its other current and long-term debt will also become due on demand as a result of cross-default provisions within loan agreements, unless MEC is able to obtain waivers, modifications or extensions. In the event MEC is unsuccessful in its efforts to raise additional funds, through an alternative transaction with MID, assets sales, by taking on additional debt or by some other means, MEC will not be able to meet such obligations. MANITOWOC CO: Bank Loan Continues Slump; Sells at 24% Discount -------------------------------------------------------------- Participations in a syndicated loan under which Manitowoc Co. Inc. is a borrower traded in the secondary market at 76.00 cents-on- the-dollar during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. This represents a drop of 3.00 percentage points -- at 79.00 cents-on-the-dollar -- from the previous week, the Journal relates. The loan matures April 14, 2014. Manitowoc pays 350 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's Ba2 rating and Standard & Poor's BB+ rating. Headquartered in Maniwotoc, Wisconsin, The Manitowoc company Inc. (NYSE: MTW) -- http://www.manitowoc.com/-- provides lifting equipment for the global construction industry, including lattice-boom cranes, tower cranes, mobile telescopic cranes, and boom trucks. As a leading manufacturer of ice-cube machines, ice/beverage dispensers, and commercial refrigeration equipment, the company offers the broadest line of cold-focused equipment in the foodservice industry. In addition, the company is a provider of shipbuilding, ship repair, and conversion services for government, military, and commercial customers throughout the maritime industry. The company has regional offices in Mexico and Brazil * * * On July 31, TCR reported that Moody's Investors Service affirmed the Ba2 Corporate Family and Probability of Default ratings of Manitowoc following its announced syndication of a new credit facility to fund its acquisitions of Enodis plc. Moody's also assigned a Ba2 rating to the proposed US$2.925 billion senior secured bank credit facility and lowered the senior unsecured notes to B1 from Ba3. The outlook remains stable. MASONITE INT'L: Bank Loan Continues Slide; Sells at 59% Discount ---------------------------------------------------------------- Participations in a syndicated loan under which Masonite International Inc. is a borrower traded in the secondary market at 40.86 cents-on-the-dollar during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. This represents a drop of 1.48 percentage points -- at 42.33 cents-on-the-dollar -- from the previous week, the Journal relates. The bank loan matures April 16, 2013. Masonite pays 200 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's Caa3 rating and Standard & Poor's CC rating. About Masonite International Based in Ontario, Canada, Masonite International Corporation -- http://www.masonite.com/-- (TSE:MHM) is a vertically integrated producer, manufacturing key components of doors, including composite molded and veneer door facings, glass door lites and cut stock. The company provides these products to its customers in more than 70 countries around the world. The company is a wholly owned subsidiary of Masonite International Inc. It offers a range of interior and exterior doors. Masonite Canada operates Masonite International's Canadian subsidiaries, well as certain other non- United States subsidiaries. * * * As reported in the Troubled Company Reporter on Sept. 1, 2008, Standard & Poor's Ratings Services lowered its long-term corporate credit ratings on Masonite International Inc. (Masonite) and its subsidiaries, Masonite International Corp. and Masonite US Corp., to 'CCC+' from 'B-'. S&P also lowered the senior secured debt rating on Masonite to 'B' from 'B+'. The ratings remain on CreditWatch with negative implications, where they were placed April 18, 2008. As reported by the Troubled Company Reporter, Masonite entered into a further extension, to February 9, 2009, of its forbearance agreements with its bank lenders and with holders of a majority of the senior subordinated notes due 2015 issued by two of the Company's subsidiaries. MEDIANEWS GROUP: Bank Loan Sells at 80% Off in Secondary Market --------------------------------------------------------------- Participations in a syndicated loan under which MediaNews Group Inc. is a borrower traded in the secondary market at 21.30 cents- on-the-dollar during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. This represents a drop of 4.00 percentage points from the previous week, the Journal relates. The loan matures on December 31, 2010. MediaNews pays 125 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's Caa2 rating and Standard & Poor's CCC+ rating. Headquartered in Denver, Colorado, MediaNews Group Inc. is a large newspaper publishing company. For the LTM period ended September 30, 2008, the company reported pro-rata revenues of approximately $1.2 billion. * * * As reported by the Troubled Company Reporter on December 15, 2008, Moody's Investors Service downgraded MediaNews' Corporate Family rating to Caa3 from B3 and Probability of Default rating to Caa3 from Caa1, reflecting Moody's concern that the downturn of the company advertising sales will be significantly more protracted than previously anticipated, further straining the company's liquidity profile and heightening the probability of a covenant default. MICHAEL VICK: To Spend Last Two Months of Imprisonment at Home -------------------------------------------------------------- The Associated Press reports that a government official said that Michael Vick will be allowed to serve the last two months of his imprisonment at home because there is no room at a halfway house for him. According to The AP, Mr. Vick had pleaded guilty of bankrolling a dogfighting operation at a home he owned in eastern Virginia's Surry County and participating in the killing of several underperforming dogs. He is serving a 23-month sentence at the federal penitentiary in Leavenworth, Kansas, says the report. Citing a government official, The AP states that the attorneys for Mr. Vick said that they expected him to be moved any day into a halfway house in Newport News, but due to a lack of space he will be released instead to his home in Hampton on or after May 21. Court documents say that the $748,100, five-bedroom, 3,538-square- foot brick Hampton house is one of the four properties Mr. Vick still owns. The AP relates that Mr. Vick sold the Surry County property that served as headquarters for his BadNewz Kennels after his indictment in July 2007. The government official, according to The AP, said that Mr. Vick will be on electronic monitoring and will only be allowed to leave home for activities approved by his probation officer. The AP states that Mr. Vick is eligible for release in July. Mr. Vick's lawyers, Billy Martin and Lawrence Woodward said in a statement, "We are aware of reports regarding the release of Michael Vick. As his attorneys we understand and respect that there is a process that the Bureau of Prisons follows therefore it is not appropriate for us comment at this time." Mr. Vick Awaits Return to NFL Citing Mr. Vick's lawyers, The AP reports that their client wants to resume his pro football career. According to the report, NFL Commissioner Roger Goodell, who suspended Mr. Vick without pay, has been saying that he will review Mr. Vick's status after the legal proceedings are completed. The AP notes that Falcons general manager Thomas Dimitroff said this month that his team will try to trade the contract rights on Mr. Vick to another team. The AP says Mr. Vick has a contract that runs to 2013 and calls for him to receive a base salary of $9 million and a bonus of $6.43 million this year. According to The AP, the remainder of the contract is valued at $45.11 million, with an additional possible $3 million in Pro Bowl bonuses. The AP relates that officials of some other NFL teams have said they are not interested in Mr. Vick because they wouldn't want to face the wrath of pet lovers and groups like PETA, which has been a constant fixture at Mr. Vick's hearings. According to Kofi Bofah at The Associated Content, Mr. Vick currently earns 12 cents per hour washing dishes at Leavenworth, KS Federal Prison. The Associated Content states that Mr. Vick is claiming that he has $16 million in assets. Mr. Vick, court documents say, owns an interest in a $2 million home being constructed in Suffolk. The AP relates that Mr. Vick's eight- bedroom home in suburban Atlanta will be sold in an auction on March 10, with a $3.2 million minimum opening bid. Mr. Vick said that he has $20.4 million in liabilities, The Associated Press states. The Associated Content notes that Mr. Vick spends $20,000 per month to support his mother, fiancee Kijafa Frank and their two children, and his young son of a previous relationship. The Associated Content states that Mr. Vick has $4,700 monthly mortgage and $2,000 worth of car payments on behalf of his mother, Brenda Boddie. Mr. Vick has also paid $350 per month for DirectTV, $700 for an Easter egg hunt, and $327,900 donation to Palms Ministry Church on account of his mother, says The Associated Content. Mr. Vick deposited about $1,000 into his mother's account for almost every two weeks, calling one transaction as "chump change", according to the report. Mr. Vick, says The Associated Content, spent $17.7 million in two years from July 2006 to July 2008. Michael Vick filed for Chapter 11 protection on July 7, 2008 (Bankr. E.D. Va. Case No. 08-50775). Dennis T. Lewandowski, Esq., and Paul K. Campsen, Esq., at Kaufman & Canoles, P.C., represent Mr. Vick in his bankruptcy case. Mr. Vick listed assets of $16.1 million and debts of $20.4 million in his bankruptcy filing. MICHAELS STORES: Bank Loan Continues Slump; Sells at 44% Discount ----------------------------------------------------------------- Participations in a syndicated loan under which Michaels Stores Inc. is a borrower traded in the secondary market at 56.36 cents- on-the-dollar during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. This represents a drop of 1.83 percentage points -- 58.19 cents-on-the-dollar -- from the previous week, the Journal relates. The bank loan matures October 31, 2013. Michaels Stores pays 225 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B2 rating and Standard & Poor's B rating. Syndicated loans of fellow retailers also slid in secondary market trading during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. Neiman Marcus Group Inc. bank debt traded in the secondary market at 65.07 cents-on-the-dollar, a drop of 1.80 percentage points -- at 66.86 cents-on-the-dollar -- from the previous week. The bank loan matures April 6, 2013. Neiman Marcus pays 175 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's Ba3 rating and Standard & Poor's BB rating. Burlington Coat Factory Warehouse Corp bank debt traded in the secondary market at 35.29 cents-on-the-dollar, a drop of 2.13 percentage points -- at 37.42 cents-on-the-dollar -- from the previous week. The syndicated loan matures May 28, 2013. Burlington Coat pays 225 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B3 rating and Standard & Poor's CCC+ rating. Meanwhile, bank debt of video-rental company Blockbuster Inc. traded in the secondary market at 69.20 cents-on-the-dollar. Trading in the bank debt increased 1.90 percentage points from the previous week, the Journal relates. The loan matures August 20, 2011. Blockbuster pays 375 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B1 rating and Standard & Poor's B rating. In addition, the bank debt of toy seller Toys R Us traded in the secondary market at 55.50 cents-on-the-dollar an increase of 2.50 percentage points from the previous week. The loan matures on July 19, 2012. Toys R Us pays 425 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B2 rating and Standard & Poor's BB- rating. Based in Irving, Texas, Michaels Stores, Inc. is North America's largest specialty retailer of arts, crafts, framing, floral, wall decor, and seasonal merchandise for the hobbyist and do-it- yourself home decorator. As of December 1, 2008, the Company owns and operates 1,014 Michaels stores in 49 states and Canada, and 163 Aaron Brothers stores. MIDWAY GAMES: Section 341(a) Meeting Set for March 26 in Delaware ----------------------------------------------------------------- Roberta A. DeAngelis, the United States Trustee for Region 3, will convene a meeting of creditors of Midway Games Inc. and its debtor-affiliates on March 26, 2009, at 2:00 p.m. at the J. Caleb Boggs Federal Building, 844 King Street, 2nd Floor, Room 2112, Wilmington, Delaware. This is the first meeting of creditors required under Section 341(a) of the Bankruptcy Code in all bankruptcy cases. All creditors are invited, but not required, to attend. This Meeting of Creditors offers the one opportunity in a bankruptcy proceeding for creditors to question a responsible office of the Debtor under oath about the company's financial affairs and operations that would be of interest to the general body of creditors. Headquartered in Chicago, Illinois, Midway Games Inc. -- http://www.midway.com-- develops video games and sell them primarily in North America, Europe, Asia and Australia. The Company and nine affiliates filed for Chapter 11 protection on February 12, 2009 (Bankr. D. Del. Lead Case No. 09-10465). David W. Carickhoff, Jr., Esq., Michael David Debaecke, Esq., and Victoria A. Guilfoyle, Esq., at Blank Rome LLP, represent the Debtors in their bankruptcy cases. The Debtors tapped Lazard Freres as their investment banker, Dewey & LeBoeuf LLP as special counsel, and Epiq Bankruptcy Solutions LLC as claims agent. The Debtors' financial condition as of Sept. 30, 2008, showed $167,523,000 in total assets and $281,033,000 in total debts. MINNEAPOLIS GRAND: Files for Bankruptcy Protection -------------------------------------------------- Chris Newmarker at Minneapolis/St. Paul Business Journal reports that The Minneapolis Grand, LLC, has filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the District of Minnesota. Court documents say that The Minneapolis Grand listed small unsecured credit claims from utility and insurance companies. Tria Properties posted on its Web site that it paid $13 million in 2007 for The Minneapolis Grand. Business Journal relates that The Minneapolis Grand had previously been the subject of a federal corruption case. The report says that former Minneapolis Councilman Dean Zimmerman was imprisoned after being convicted in 2006 of accepting bribes from the project's developer. Rolling Meadows, Illinois-based The Minneapolis Grand, LLC, is a Minneapolis apartment community and a limited liability corporation formed for the Minneapolis Grand on Chicago Avenue. It is a mixed-use property with over 27,000 square feet and 81 luxury residential lofts. The Company filed for Chapter 11 on February 20, 2009 (Bankr. D. Minn. Case No. 09-40942). Ralph Mitchell, Esq., at Lapp Libra Thomson Stoebner & Pusch assists the company in its restructuring effort. The Company listed $10 million to $50 million in assets and $10 million to $50 million in debts. MUELLER WATER: Moody's Downgrades Corp. Family Rating to 'B2' ------------------------------------------------------------- Moody's Investors Service lowered all the ratings of Mueller Water Products, Inc., including its corporate family rating to B2 from B1, its probability of default rating to B2 from B1, the rating on its senior secured bank credit facility to B1 from Ba3, and the rating on its senior subordinated notes to Caa1 from B3. At the same time, a speculative grade liquidity rating of SGL-3 was assigned. The outlook remains stable. The downgrades reflect Moody's expectation that Mueller's credit metrics will continue to erode in 2009 due to weakness in each of the company's key end markets: residential construction, non- residential construction, and municipal water infrastructure. In addition, price rollbacks are possible since scrap iron, brass, and other raw material input prices have fallen since peaking in the summer of 2008. Lower sales and the impact of lower volume are expected to significantly reduce margins, although Moody's expects Mueller will maintain its positive cash flow. Nevertheless, covenant compliance may become problematic in the latter part of 2009, which could require the company to seek a covenant waiver or amendment from its lending group. Moody's expects all of Mueller's end markets will be weak in 2009. Robust spending on non-residential construction and on municipal water infrastructure, which improved the company's operating performance during the majority of 2007 and 2008, will no longer offset weak residential construction spending. In addition, any recovery in the residential housing market may take time to benefit Mueller, given the large oversupply of housing inventory. At the same time, the ratings acknowledge Mueller's strong, defensible market position, with barriers to entry afforded by a substantial installed base of diverse products and strong relationships with key suppliers. The ratings are also supported by the favorable long-term outlook for municipal water infrastructure spending. In addition, Mueller's large and growing cash position, positive free cash flow generation, and $300 million unused revolver support the company's B2 corporate family rating. Mueller's SGL-3 rating indicates adequate liquidity for the next 12 months, and takes into consideration Mueller's internal and external liquidity, projected covenant compliance, and access to alternative liquidity sources. The company's good internal and external liquidity are supported by its large (and growing) cash position of $151.8 million at December 31, 2008 as well as its $300 million unused revolver. In terms of covenants, however, Moody's expects the existing headroom under Mueller's two principal covenants -- especially its leverage covenant - to quickly erode in 2009. Lastly, because the company's bank credit facility is secured by substantially all assets, it has limited ability to monetize its assets as an alternative source of liquidity. Mueller's stable outlook reflects Moody's expectation that the company will continue to generate positive free cash flow to preserve its current liquidity position and maintain capital structure discipline. Moody's last rating action for Mueller occurred on February 20, 2008, when the company's outlook was changed to stable from positive. These rating actions were taken: -- Corporate Family Rating, lowered to B2 from B1; -- Probability of Default Rating, lowered to B2 from B1; -- $300 million Senior Secured Bank Credit Facility due 2012, lowered to B1 (LGD3, 35%) from Ba3; -- $150 million Senior Secured Term Loan due 2012, lowered to B1 (LGD3, 35%) from Ba3; -- $565 million Senior Secured Term Loan due 2014, lowered to B1 (LGD3, 35%) from Ba3; -- $425 million Senior Subordinated Notes due 2017, lowered to Caa1 (LGD5, 86%) from B3; -- Speculative grade liquidity rating of SGL-3 assigned; Outlook remains stable. Headquartered in Atlanta, Georgia, Mueller Water Products, Inc. is a North American manufacturer and supplier of water infrastructure and flow control products for use in water distribution networks, water and wastewater treatment facilities, and gas distribution and piping systems. Consolidated revenues and adjusted EBITDA for the trailing twelve months ended December 31, 2008, were approximately $1.8 billion and $253 million, respectively. NATIONAL AMUSEMENTS: To Sell Assets to Repay Debt by End of 2010 ---------------------------------------------------------------- Merissa Marr at The Wall Street Journal reports that National Amusements Inc. has reached an agreement with lenders to repay debt by the end of 2010. WSJ relates that under the agreement, National Amusements will sell assets to help repay the debt. As reported by the Troubled Company Reporter on December 22, 2008, National Amusements was considering selling some of its theaters in the U.S., Britain and Latin America to help pay down $1.6 billion in debts. Analysts said that the theater chain is worth between $500 million and $700 million, while National Amusements believes it is worth about $1 billion. Sumner Redstone was able to get the lenders to agree that he and his family will decide on which assets to sell, WSJ states. Mr. Redstone, WSJ says, doesn't want to sell his controlling interest in Viacom Inc. or CBS Corp. WSJ relates that National Amusements' talks with lenders had caused concerns that Mr. Redstone and his family would be required to sell more of their shares in Viacom and CBS to pacify creditors. WSJ notes that Mr. Redstone would sell a chunk of the family's movie-theater chain. Citing people familiar with the matter, WSJ states that National Amusements has put out feelers to determine possible interest in its 1,500 screens and will begin a formal process soon. The sources said that the decision on which theaters to sell will depend on offers, WSJ relates. WSJ states that National Amusements said that it would also use tax refunds and cash from operations to meet repayment schedule. According to WSJ, National Amusements will make its first payment on the closing of the deal, which sources say is expected this month. WSJ says that the payment will cut the debt to about $1.46 billion. National Amusements will then make heftier repayments late this year and in 2010, WSJ relates. About National Amusements, Inc. National Amusements, Inc., North America's sixth largest theatre operator is a closely held corporation, that operates more than 1,425 motion picture screens in the U.S., the U.K., Latin America, is an equal partner in the online ticketing service, MovieTickets.com and the parent company of Viacom. Viacom is a leading global media company, with preeminent positions in broadcast and cable television, radio, outdoor advertising and online. With programming that appeals to audiences in every demographic category across virtually all media, the company is a leader in the creation, promotion and distribution of entertainment, news, sports, music and comedy. Viacom's well-known brands include CBS, MTV, Nickelodeon, VH1, BET, Paramount Pictures, Viacom Outdoor, Infinity, UPN, Spike TV, TV Land, CMT: Country Music Television, Comedy Central, Showtime, Blockbuster, and Simon & Schuster. As reported by the Troubled Company Reporter on Nov. 25, 2008, National Amusements would likely have to file for Chapter 11. Owner Sumner Redstone put last month about $233 million of his stock in Viacom and CBS, which he controls through National Amusements, to try to fix his debt problems after the stock market dropped lower and National Amusements breached an asset-to-debt covenant. The move didn't work, and the Redstone family has since been discussing with its lenders about restructuring a $1.6 billion debt. NEENAH FOUNDRY: Moody's Downgrades Corp. Family Rating to 'Caa2' ---------------------------------------------------------------- Moody's Investors Service downgraded Neenah Foundry Company's Corporate Family Rating to Caa2 from Caa1, Probability of Default rating to Caa2 from Caa1, and its $225 million senior secured notes due 2017 to Caa2 from Caa1. The rating outlook remains negative. The downgrades reflect Neenah's further deteriorated credit metrics and weakened liquidity and Moody's expectation that these metrics will likely remain weak over the intermediate term as the economic pressures that have adversely affected the company's performance are likely to persist. Though somewhat diversified by business segment, Neenah's recent financial results have been negatively impacted by the convergence of the dramatic cyclical declines being seen by most of its end markets, such as the reduced production volume of heavy-duty commercial vehicle, lower demand in the heavy municipal segment as well as the agriculture and construction segment. The company's weak financial performance was further exacerbated by margin pressures in part arising from negative operating leverage from sharply declined volume, restructuring charges related to plant closures and raw material cost volatility such as scrap steel and, at a time when its level of fixed charges remains elevated from inherently high debt balance. As of December 29, 2008, Neenah's EBIT/Interest (as adjusted by Moody's) was 0.1x, Debt/EBITDA was 11.8x and free cash flow was considerably negative. The negative outlook reflects Moody's expectation that Neenah's liquidity would remain weak with minimal anticipated cushion above the $15 million excess borrowing availability threshold under its asset-based revolving credit facility in the next twelve months. Moody's cautions that there could be a potential covenant violation if the availability under the revolver fell below the threshold to trigger a springing covenant. The rating could be further downgraded should the company's liquidity contract further and/or a debt restructuring come to fruition. "At this level of leverage and interest coverage, Neenah's capital structure has become increasingly unsustainable," commented Moody's analyst John Zhao. "We view a restructuring of the balance sheet a likely scenario in the intermediate term." The rating actions are: * Corporate Family Rating -- to Caa2 from Caa1 * Probability of Default -- to Caa2 from Caa1 * $225 million of senior secured notes due 2017, to Caa2 (LGD4, 54%) from Caa1 (LGD4, 52%). Neenah's $110 million asset based senior secured revolving credit facility, and $75 million senior subordinated notes are not rated by Moody's. Moody's last rating action on Neenah was on August 26, 2008, when its CFR was downgraded to Caa1 from B2. Neenah, headquartered in Neenah, Wisconsin, manufactures and markets a wide range of metal castings and forgings for the heavy municipal market plus a wide range of complex industrial castings, with concentrations in the medium- and heavy-duty truck and HVAC markets. Annual revenues approximate $500 million. NEIMAN MARCUS: Bank Loan Sells at 35% Off in Secondary Market ------------------------------------------------------------- Participations in a syndicated loan under which Neiman Marcus Group Inc. is a borrower traded in the secondary market at 65.07 cents-on-the-dollar during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. This represents a drop of 1.80 percentage points -- at 66.86 cents-on-the-dollar -- from the previous week, the Journal relates. The bank loan matures April 6, 2013. Neiman Marcus pays 175 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's Ba3 rating and Standard & Poor's BB rating. Syndicated loans of fellow retailers also slid in secondary market trading during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. Participations in a syndicated loan under which Michaels Stores Inc. is a borrower traded in the secondary market at 56.36 cents- on-the-dollar, a drop of 1.83 percentage points -- 58.19 cents-on- the-dollar -- from the previous week. The bank loan matures October 31, 2013. Michaels Stores pays 225 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B2 rating and Standard & Poor's B rating. Burlington Coat Factory Warehouse Corp bank debt traded in the secondary market at 35.29 cents-on-the-dollar, a drop of 2.13 percentage points -- at 37.42 cents-on-the-dollar -- from the previous week. The syndicated loan matures May 28, 2013. Burlington Coat pays 225 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B3 rating and Standard & Poor's CCC+ rating. Meanwhile, bank debt of video-rental company Blockbuster Inc. traded in the secondary market at 69.20 cents-on-the-dollar. Trading in the bank debt increased 1.90 percentage points from the previous week, the Journal relates. The loan matures August 20, 2011. Blockbuster pays 375 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B1 rating and Standard & Poor's B rating. In addition, the bank debt of toy seller Toys R Us traded in the secondary market at 55.50 cents-on-the-dollar an increase of 2.50 percentage points from the previous week. The loan matures on July 19, 2012. Toys R Us pays 425 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B2 rating and Standard & Poor's BB- rating. About Neiman Marcus Based in Dallas, Texas, Neiman Marcus, Inc. operations include the Specialty Retail Stores segment and the Direct Marketing segment. The Specialty Retail Stores segment consists primarily of Neiman Marcus and Bergdorf Goodman stores. The Direct Marketing segment conducts both online and print catalog operations under the Neiman Marcus, Horchow and Bergdorf Goodman brand names. On the Net: http://www.neimanmarcusgroup.com/ NEPTUNE INDUSTRIES: Can't File Form 10-Q Report on Time ------------------------------------------------------- Neptune Industries, Inc., is unable to complete the preparation of its financial statements in time to complete the report on Form 10-Q for the quarter ended December 31, 2008, on a timely basis. The Company said it will file the Form 10-Q very soon. Headquartered in Boca Raton, Fla., Neptune Industries Inc. (OTC BB: NPDI.OB) -- http://www.neptuneindustries.net/-- through its subsidiaries, provides aquaculture technology primarily in the United States. Going Concern Doubt As reported in the Troubled Company Reporter on Oct. 19, 2007, Berman Hopkins Wright & Laham, CPAs and Associates, LLP, expressed substantial doubt about Neptune Industries Inc.'s ability to continue as a going concern after auditing the Company's consolidated financial statements for the year ended June 30, 2007. The auditing firm pointed to the company's recurring losses from operations and recurring deficiencies in working capital. Neptune Industries' consolidated balance sheet at September 30, 2008, showed $1,507,478 in total assets and $4,208,526 in total liabilities, resulting in a $2,701,048 total stockholders' deficit. NEVADA OPERA: Raises $100,000 to Avert Closure ---------------------------------------------- Forrest Hartman at RGJ.com reports that Nevada Opera Association, which said in January that it was on the verge of collapse, has raised $100,000 and may not close. According to RGJ.com, Nevada Opera officials said in January that it would close if it failed to raise $100,000 in just four weeks. RGJ.com relates that Nevada Opera has surpassed its $100,000 goal, meeting the requirements for a $50,000 challenge donation. Citing Nevada Opera board president Randi Thompson, the company says that the company has $165,000 and received pledges for $20,000 more. "I'm touched by the community's response. To me, that just indicates how important the arts are to our community. Right before our town hall meeting, I'd say most of us were ready to just file for bankruptcy. We had just had our audit, and our auditor said, 'I have never seen a company come back from this kind of debt,'" the report quoted Ms. Thompson as saying. Ms. Thompson, RGJ.com relates, said that the $165,000 hasn't erased all debt but it lets Nevada Opera move forward with performances of "La Boheme" in April. According to the report, Ms. Thompson said, "It definitely gets us through 'La Boheme,' and really we're already starting to plan for next year. It keeps us going but also keeps us going forward as well." RGJ.com states that Nevada Opera benefited from several large donations, including the $50,000 matching pledge. Most of the money came in small donations, RGJ.com says, citing Ms. Thompson and Nevada Opera executive assistant Janet Brown. Ms. Brown, according to RGJ.com, said, "I would say that we probably received maybe three donations in the $10,000 range, a couple of $5,000. Truly, the bulk of that money came from donations anywhere from $3 to $300. Many of the comments and the letters included with the donations were, 'Oh I'm sorry this isn't more.' And I told anyone who said that to me, 'Please, don't be sorry. This is truly how we're making it.'" Nevada Opera Association -- http://www.nevadaopera.org/-- is located in Reno Nevada, and has been producing and preforming world class Operas since 1968. NOBLE INTERNATIONAL: Receives 30-Day Accommodations from Big 3 -------------------------------------------------------------- Noble International, Ltd., said that it has entered into a 30-day, binding memorandum of understanding dated February 23, 2009 with its customers -- General Motors Corporation, Ford Motor Company, Chrysler, LLC -- and Comerica Bank, as agent for itself and other lenders under its U.S. and Canadian credit facility. Noble International said that it is facing liquidity pressure due to significant deterioration of business conditions facing North American and European vehicle manufacturers, which in turn is due to on-going and intensifying macroeconomic trends and conditions, including the global credit crisis and plunging consumer confidence. "In recent weeks, industry conditions have continued to deteriorate and pressure on the Company's short-term liquidity has increased. The pressure is severe in both Europe and North America and, in the latter case, is especially acute." Pursuant to the MOU, the Customers agreed to expedited payment of amounts owed to the Company and other accommodations of financial benefit to the Company and agreed to provide a limited amount of short-term financing through the purchase of subordinated participations in the Credit Facility. Concurrently with the signing of the MOU, the Company and the Lenders also entered into a forbearance agreement dated February 24, 2009, and expiring March 23, 2009, unless earlier terminated. In the Forbearance Agreement, the parties agreed, effective immediately, to terminate the Lenders' commitment to make revolving credit advances. The revolving credit feature of the Credit Facility has been converted into a discretionary facility, payable on demand and expiring on the Expiration Date unless extended. Under the terms of the discretionary facility, the Lenders may continue, but are not obligated, to advance funds to the Company in accordance with the Credit Facility through the Expiration Date subject to a "borrowing base" formula and limited to $5 million in principal amount outstanding at any time. The Lenders have agreed to refrain from exercising remedies under the Credit Facility until the Expiration Date, subject to earlier termination. Earlier termination is permitted in the event of a default under the Credit Facility or a default under the Forbearance Agreement, in the event of further deterioration in the financial condition of the Company or further deterioration in the Lenders' collateral position, or in the event that the Lenders believe that the prospect of payment or performance is impaired. A Mexican subsidiary of the Company is obligated to repay, on March 2, 2009, a borrowing from Comerica Bank, guaranteed by the Company, in the outstanding principal amount of approximately $9.2 million. Default on the Mexican Loan also would be a default on the Credit Facility. Incident to entering into the revised credit arrangements mentioned above, Comerica Bank has agreed that if, on or before March 2, 2009, it receives $2 million toward repayment of the outstanding principal amount of the Mexican Loan, then it will agree to forbear, through the Expiration Date, with respect to the maturity date default on the Mexican Loan. The accommodations evidenced by the MOU, the Forbearance Agreement and the understanding with respect to the Mexican Loan could provide the Company with credit sufficient to meet its ongoing obligations to the Expiration Date, but this is not assured (in part because the $2 million pay-down on the Mexican Facility needed by March 2, 2009 has not yet been arranged and is by no means assured). In addition, as noted above, the Lenders are not obligated to advance additional funds to the Company under the Credit Facility and can terminate the Forbearance Agreement at any time if in their judgment the prospect of repayment is impaired. As a result of the arrangements described above, discretionary loans made by the Lenders, together with up to $2 million in additional funding by the Customers in and pursuant to the MOU, are the Company's primary sources of working capital. Events of default under the MOU include, among other things, the Company's or the Lenders' material breach of the MOU or the Lenders not lending in accordance with the applicable loan agreements. The Company continues to work with its advisors to analyze and consider strategic alternatives and to identify both short- and long-term funding solutions. $45-Mil. Charge for Customer Contracts On February 24, 2009, the Company's Board of Directors determined that the Company's European intangible assets related to customer contracts are fully impaired as of December 31, 2008 and that it will record an estimated impairment charge of $45 million. The Company said that this impairment is a result of deteriorating business conditions world-wide, which have adversely affected the recoverability of the Company's long-lived assets and goodwill. The estimated impairment charge is in addition to the estimated impairment charges previously disclosed on December 9, 2008. At that time, the Company said that it will record a goodwill and long-lived asset impairment charge in an estimated amount between $97 million and $125 million (between $4.10 and $5.30 per basic and diluted share) during the fourth quarter ended December 31, 2008, as a result of deteriorating business conditions. The Company said, in its Dec. 9 disclosure, "The impairment analysis of long-lived assets and goodwill is ongoing, but the impairment charge is expected to consist of charges of $85 million to $100 million relating to goodwill, $10 million to $20 million relating to fixed assets and $2 million to $5 million relating to intangible assets. It is expected that all goodwill associated with the Company's operations in North America will be fully impaired." The Company said that none of the costs related to the write-down or write-off of assets is expected to result in future cash expenditures. About Noble International Noble International, Ltd., provides of 21st Century Auto Body Solutions primarily to the automotive industry. Noble utilizes laser-welding, roll-forming and other technologies to produce flat, tubular, shaped and enclosed formed structures used by original equipment manufacturers (OEMs) or their suppliers in automobile applications, including doors, fenders, body side panels, pillars, bumpers, door beams, load floors, windshield headers, door tracks, door frames and glass channels. The Company operates 24 production facilities worldwide, including two joint ventures in China and one in India. Thirteen of its facilities are located in North America and the remaining 11 facilities are located primarily in Western Europe. In August 2007, Noble completed the purchase of Arcelor's Tailored Laser-Welded Blank operation. NOVELIS INC: Bank Loan Trades at 40% Discount in Secondary Market ----------------------------------------------------------------- Participations in a syndicated loan under which Novelis Inc. is a borrower traded in the secondary market at 59.10 cents-on-the- dollar during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. This represents a drop of 2.10 percentage points from the previous week, the Journal relates. Novelis pays 225 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's Ba3 rating and Standard & Poor's BB rating. Headquartered in Atlanta, Georgia, Novelis Inc. is the world's largest producer of aluminum rolled products. For the 12 months ended September 30, 2008, the company had total shipments of approximately 3,198 kilotonnes and generated $11.6 billion in revenues. * * * As reported by the Troubled Company Reporter on February 24, 2009, Standard & Poor's Ratings Services placed its ratings, including the 'BB-' long-term corporate credit rating, on Novelis Inc. on CreditWatch with negative implications. "The CreditWatch placement follows Novelis' disclosure of a liquidity squeeze brought about by the high volatility of primary aluminum prices," said Standard & Poor's credit analyst Donald Marleau. The TCR said February 3, 2009, that Moody's Investors Service downgraded Novelis' corporate family rating and its probability of default rating to B2 from B1. At the same time, Moody's downgraded the ratings on the senior secured term loans at Novelis and Novelis Corporation (due 2014) to Ba3 from Ba2. The speculative grade liquidity rating was also downgraded to SGL-3 from SGL-2. The rating on its 7.25% senior unsecured notes due 2015 was affirmed at B3. The rating outlook is negative. The downgrade reflects the company's weakened financial position and coverage ratios and considers the difficult operating environment facing the company, which Moody's expects to continue over the next twelve to fifteen months. The TCR said January 28, 2009, that Fitch Ratings downgraded the Issuer Default Rating and outstanding debt ratings of Novelis Inc. and its subsidiary Novelis Corp.: -- IDR to 'B-' from 'B'; -- Senior secured asset-based revolver to 'BB-/RR1' from 'BB/RR1'; -- Senior secured term loan to 'BB-/RR1' from 'BB/RR1'; -- Senior unsecured notes to 'CCC/RR5' from 'B/RR4'. OFFICE DEPOT: S&P Downgrades Corporate Credit Rating to 'B' ----------------------------------------------------------- Standard & Poor's Ratings Services said it lowered its ratings on Boca Raton, Florida-based Office Depot Inc., including its corporate credit rating to 'B' from 'BB-'. S&P also lowered the rating on the company's $400 million of senior unsecured notes due 2013 to 'B-' from 'B+'. The recovery rating on these notes remains unchanged at '5', indicating the expectation for modest (10%-30%) recovery in the event of a payment default. The outlook is negative. Office Depot had about $880.7 million of reported debt outstanding at Dec. 27, 2008. "The rating action is based on our expectation that the deterioration in credit protection measures in 2009 is likely to be worse than previously anticipated," said Standard & Poor's credit analyst Mark Salierno. For the fiscal year ended Dec. 27, 2008, total debt to EBITDA increased to just above 6x, compared with leverage of about 3x at the end of fiscal 2007. "We believe that extremely weak global macroeconomic conditions and the protracted slowdown in consumer and corporate spending," added Mr. Salierno, "will continue to pressure operating performance within the company's key business segments, placing further pressure on the company's earnings and cash flow." As a result, S&P expects that leverage will remain at elevated levels during this time. OSI RESTAURANT: Bank Loan Sells at 52% Off in Secondary Market -------------------------------------------------------------- Participations in a syndicated loan under which OSI Restaurant Partners, Inc. is a borrower traded in the secondary market at 47.33 cents-on-the-dollar during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. This represents a drop of 1.42 percentage points from the previous week, the Journal relates. The loan matures May 9, 2014. OSI Restaurant pays 225 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B3 rating and Standard & Poor's B+ rating. About OSI Restaurant OSI Restaurant Partners is the #3 operator of casual-dining spots (behind Darden Restaurants and Brinker International), with more than 1,400 locations in the US and 20 other countries. Its flagship Outback Steakhouse chain boasts more than 950 locations that serve steak, chicken, and seafood in Australian-themed surroundings. OSI also operates the Carrabba's Italian Grill chain, with about 240 locations. Other concepts include Bonefish Grill, Fleming's Prime Steakhouse, and Cheeseburger In Paradise. Most of the restaurants are company owned. A group led by chairman Chris Sullivan took the company private in 2007. * * * As reported by the Troubled Company Reporter on Feb. 24, 2009, Moody's Investors Service downgraded OSI Restaurant's Probability of Default rating to Ca from Caa1 and lowered the rating on its $550 million 10% senior unsecured notes to C from Caa3. Moody's also placed OSI's Corporate Family and senior secured ratings on review for possible downgrade. The review was prompted by the recent announcement that OSI continues to experience a substantial decline in earnings and store traffic to levels worse than Moody's previously expected. The company also announced that it will likely need to take an impairment charge of between $480 and $540 million for goodwill due to a reduction in its projected results for future periods as a result of poor overall economic conditions. OFFICE DEPOT: Moody's Downgrades Corp. Family Rating to 'B1' ------------------------------------------------------------ Moody's Investors Service downgraded Office Depot, Inc.'s corporate family and probability of default ratings to B1, downgraded the senior unsecured note rating to B3, and left the ratings on review for further possible downgrade. Office Depot's SGL-3 speculative grade liquidity rating was affirmed. The downgrade results from Office Depot's continuing difficulty in navigating the weak operating environment, culminating in FYE 2008 performance that resulted in debt/EBITDA of 6.3 times, which is not reflective of a Ba3 rating. "Office Depot's operating performance is continuing to suffer as a result of the severe downturn in the economy, as well as its geographic concentration in the particularly hard-hit California and Florida markets," stated Moody's Senior Analyst Charlie O'Shea. The review for further possible downgrade considers the lack of earnings visibility with respect to 2009 performance, and uncertainty as to whether Office Depot will be able to stabilize its performance enough to hold the B1 rating. Moody's review will focus on the progress management makes in its expense reduction and liquidity improvement efforts and the degree to which this these efforts can offset a further erosion in credit metrics. The affirmation of Office Depot's SGL-3 speculative grade liquidity rating considers that despite revenue and profit declines, liquidity remains adequate. A key factor in the affirmation is the recent closing of a $1.25 billion asset-based revolving credit facility and Moody's continued expectation that usage under this facility will be largely limited to funding seasonal inventory build. Ratings downgraded and left on review for further possible downgrade include: -- Corporate family rating to B1 from Ba3; -- Probability of default rating to B1 from Ba3, and -- Senior unsecured notes to B3 from B1. Rating affirmed: -- Speculative grade liquidity rating of SGL-3. The last rating action for Office Depot was the December 16, 2008 downgrade to Ba3 of the corporate family and probability of default ratings, the downgrade of the senior unsecured notes to B1, and the affirmation of the SGL-3 speculative grade liquidity rating. Office Depot, Inc., based in Boca Raton, Florida, is the second largest retailer of office supplies with 1,275 retail locations in North America. The company generates annual revenues of about $14.3 billion. OPTI CANADA: Moody's Downgrades Corporate Family Rating to 'B3' --------------------------------------------------------------- Moody's Investors Service downgraded OPTI Canada Inc's Corporate Family Rating and second secured note ratings, and confirmed its first secured revolver rating. The rating outlook is negative. The Corporate Family Rating was downgraded to B3 from B1, OPTI's amended C$350 million senior first secured bank revolver rating was confirmed at Ba3, and its US$1.750 billion senior second secured note rating was downgraded to B3 from B2. The downgrades reflect a reduced likelihood that OPTI and its joint venture partner Nexen (project operator) will bring their integrated Long Lake steam assisted gravity drainage and bitumen upgrader project adequately close to design specifications in time for OPTI to demonstrate internal support of its debt structure by year-end 2009. It is likely to be sometime during 2010 when the level of sustainable SAGD and upgrader production, unit operating costs, and net price realizations on production can reliably be gauged. Furthermore, with the pace of cash flow growth highly uncertain, it remains unclear how much OPTI will need to borrow under its revolver this year to fund capital spending requirements. Accordingly, with both the numerator and denominator of its first secured bank credit Debt/EBITDA covenant being highly uncertain, it is not clear that OPTI will meet its September 30, 2009 bank leverage covenant. While the ratings are supported by Moody's view that the circumstances indicate OPTI would ultimately be able to negotiate temporary covenant relief in need, and/or raise more cash by selling an additional portion of its project ownership, such outcomes are too contingent to support a rating higher that B3 in light of the operating uncertainties and difficult conditions in the banking market. The ratings are also supported by significant internal liquidity to fund a substantial proportion of 2009 needs. As of February 17, 2009, OPTI reports that it held C$280 million of cash on hand and undrawn available revolver capacity of C$263 million. The ratings also are supported by the fact that, under the terms of OPTI's 15% ownership interest sold to Nexen, Nexen will be funding the first $85 million of OPTI's $114 million 2009 capital spending budget. While still substantial, OPTI's asset coverage of the US$1.750 billion of second secured notes has been reduced after its sale of 30% of its stake (15% of the project) in the project to Nexen in December 2008 for C$ 735 million. OPTI also passed along upgrader operator responsibilities to Nexen. After substantial project construction delays, project start-up complications, substantial cost overruns, and less equity funding than had been indicated at the beginning of the project, OPTI carries very high leverage relative to its fully funded proven developed producing reserve base. Including future development costs to bring net proven undeveloped reserves to production, and net probable reserves to production, leverage on total net proven and net proven and probable reserves is also very high. The ratings are also supported by substantial proven and probable reserve asset coverage from long-lived bitumen reserves and resources. The degree of asset support provided by the upgrader remains a function of how efficiently and at what level it will operate. Based on OPTI's share of year-end 2008 reserves, currently estimated total debt of approximately US1.82 billion represents approximately US$27.50/Bbl of proven developed producing reserves (59.813 mmbbls). Including development costs for proven undeveloped reserves, leverage on total net proven reserves (243.182 mmbbls) approximates US$14/bbl. Including development costs for probable reserves, leverage on net proven plus net probably reserves approximates US$6/bbl in 2008 dollars. The bitumen properties provide relatively good asset coverage and are a potential attraction to new investment capital, including the possibility of selling further ownership interests to Nexen. OPTI holds a 35% undivided interest (with Nexen, Baa2 senior unsecured, which holds the other 65%) in a six-phased greenfield integrated development of three oil sands leases in Alberta, Canada. OPTI's 35% share of proven developed, proven undeveloped, and probable bitumen reserves is approximately 613 million barrels (170 million barrels booked as proven) as of December 31, 2008. OPTI's ratings have been assigned by evaluating factors that Moody's believes are relevant to the company's risk profile, such as the company's (i) business risk and competitive position compared with others within the industry; (ii) capital structure and financial risk; (iii) projected performance over the near to intermediate term; and (iv) management's track record and tolerance for risk. These attributes were compared against other issuers both within and outside OPTI's core industry; OPTI's ratings are believed to be comparable to those of other issuers with similar credit risk. The last rating action was on November 24, 2008 when OPTI's Corporate Family Rating and second secured note ratings were downgraded to B1 from Ba3 and B2 from B1, respectively, with the ratings left under review for further downgrade. OPTI Canada Inc. is headquartered in Calgary, Alberta, Canada. PENTON BUSINESS: Weak Market Conditions Cue Moody's Junk Rating --------------------------------------------------------------- Moody's Investors Service has downgraded Penton Business Media Holdings, Inc.'s Corporate Family and Probability of Default ratings to Caa2 from B3 and changed the rating outlook to negative reflecting Moody's expectation that continuing weak market conditions will place further strain on the company's liquidity profile and financial metrics, elevating the risk of default over the near-to-intermediate term. Details of the rating actions are: Ratings downgraded: * Corporate Family rating -- to Caa2 from B3 * PDR -- to Caa2 from B3 * Senior secured first lien revolving credit facility -- to Caa1, * LGD3, 34% from B2, LGD3, 33% * Senior secured first lien term loan -- to Caa1, LGD3, 34% from B2, LGD3, 33% * Senior secured second lien term loan -- to Caa3, LGD5, 87% from Caa2, LGD5, 86% The rating outlook is negative. The downgrade of the CFR to Caa2 largely reflects Moody's concern that the rate of decline of Penton's top line (which was down 5% in Q308 over the prior year period, adjusted for trade show timing differences) will deteriorate further over the near-term, placing additional strain on the company's liquidity profile and precluding a reduction of debt below the 8.0x multiple of EBITDA target previously set by Moody's for maintenance of then-revised ratings. In addition, the downgrade incorporates Moody's view that decreased investor appetite for the B-2-B sector has reduced the value of Penton's business to levels that may be substantially below the company's current debt level, presenting weaker refinancing opportunities and/or recovery prospects for debtholders (especially second lien lenders) in a default scenario. The downgrade of the PDR to Caa2 incorporates Moody's view that softening market spending in the business-to-business segment will likely cause Penton to default under its financial covenants over the near-term, absent an amendment. Moody's considers that Penton's first lien lenders would be reluctant to loosen the company's already-elevated covenant levels (including a current 9.0 times total leverage test) on less than very onerous terms and conditions, inducing the company to look to its owners (Wasserstein & Co. and MidOcean Partners) to provide an equity cure, as permitted under the senior secured loan agreements. Furthermore, Moody's consider that management will likely explore a more comprehensive overhaul of the company's balance sheet, including a debt restructuring, or a discounted debt repurchase program, among other alternatives. The change in the rating outlook to negative underscores Moody's concern that Penton's customers will experience further business contraction, as its customers continue to cut-back on their travel budgets, trade show attendance and spending on exhibit space. In addition, the negative outlook expresses Moody's view that market spending on B-to-B magazine advertising (down by over 13% in December 2008 according to a recent report by Business Information Network) will face increasing pressure from further weakening of economic conditions and secular pressure from electronic substitution, the latter providing relatively low barriers to entry for existing or emerging competitors. The revised Caa2 Corporate Family rating incorporates Penton's heavy debt burden and high financial leverage; its vulnerability to business-to business spending and the strong competition which the company faces from other B-2-B rivals. The ratings are supported by the long-established reputation and current barriers to entry enjoyed by Penton's niche publications and trade shows (especially the Natural Products Expos), and the diversification and severability of its portfolio of assets. The last rating action occurred on June 5, 2008, when Moody's downgraded Penton's CFR to B3 from B2. Additional research, including the most recent Credit Opinion, can be found on www.moodys.com. Penton's ratings were assigned by evaluating factors Moody's believe are relevant to the credit profile of the issuer, such as i) the business risk and competitive position of the company versus others within its industry, ii) the capital structure and financial risk of the company, iii) the projected financial and operating performance of the company over the near- to-intermediate term, and iv) management's track record and tolerance for risk. These attributes were compared against other issuers both within and outside of Penton's core industry and Penton's ratings are believed to be comparable to those of other issuers of similar credit risk. Penton Business Media Holdings, Inc. is one of the largest U.S. business-to-business communications companies. Headquartered in New York City, the company reported sales of $424 million for the LTM period ended September 30, 2008. PETTERS GROUP: Court Okays Doug Kelley as Trustee ------------------------------------------------- David Phelps at Star Tribune reports that the U.S. Bankruptcy Judge Gregory Kishel has approved the appointment of Doug Kelley as the trustee for Petters Group. As reported by the Troubled Company Reporter on January 29, 2009, Ritchie Capital Management was trying to prevent the appointment of Mr. Kelley as Petters' trustee. Ritchie Capital said that Mr. Kelley's position as court-appointed receiver for Petters creates a conflict of interest that should keep him from serving as trustee. Ritchie Capital reportedly fears that Mr. Kelley will collaborate with the U.S. Attorney's office in Minneapolis to seek payment for Mr. Petters' victims restitution before paying off his creditors. Star Tribune relates that Judge Kishel said that Mr. Kelley's being the companies' receiver and trustee brings no conflict to the companies. The report quoted Judge Kishel as saying, "There is no indication in the record ... that Kelley has ever taken any action that was self-interested, contrary to the interests of the bankruptcy estates, or in any way inconsistent with the obligations of a fiduciary steward of the estates.... Kelley has gone up an immensely steep learning curve in the last five months; he has had to amass knowledge, and analyze it with his professional persons; he is making use of that to regain assets, via legal proceedings and otherwise." According to Star Tribune, Mr. Kelley has run most of the Petters' companies since federal agents raided Petters' offices, the owner's home, and the homes of several others who were involved with Petters in what the government alleges was a $3.5 billion investment fraud scheme. "On its face, the order fixing Kelley's duties as receiver did not vest him with any interest aligned with the United States, nor mandate any action on his part that would make him its servant, agent, or ally," and the directive to Mr. Kelley as receiver is "unadorned" and doesn't obligate him to "consort" with federal prosecutors at the expense of creditors, Star Tribune says, citing Judge Kishel. Star Tribune quoted Judge Kishel as saying, "The only duty placed on Kelley from the face of the receivership orders, is to 'hold in place,' to keep the assets secure pending their ultimate disposition via separate court proceeding." About Petters Group Worldwide Based in Minnetonka, Minn., Petters Group Worldwide LLC is named for founder and chairman Tom Petters. The group is a collection of some 20 companies, most of which make and market consumer products. It also works with existing brands through licensing agreements to further extend those brands into new product lines and markets. Holdings include Fingerhut (consumer products via its catalog and Web site), SoniqCast (maker of portable, WiFi MP3 devices), leading instant film and camera company Polaroid (purchased for $426 million in 2005), Sun Country Airlines (acquired in 2006), and Enable Holdings (online marketplace and auction for consumers and manufacturers' overstock inventory). Petters formed the company in 1988. Petters Company, Inc. is the financing and capital-raising unit of Petters Group Worldwide, LLC. Petters Company, Inc. and Petters Group Worldwide, LLC, filed separate petitions for Chapter 11 relief on Oct. 11, 2008 (Bankr. D. Minn. Case No. 08-45257 and 08- 45258, respectively). James A. Lodoen, Esq., at Lindquist & Vennum P.L.L.P., represents the Debtors as counsel. In its petition, Petters Company, Inc. listed debts of between $500 million and $1 billion, while its parent, Petters Group Worldwide, LLC listed debts of not more than $50,000. As reported in the Troubled Company Reporter on Oct. 7, 2008, Petters Aviation, LLC,, and affiliates MN Airlines, LLC, doing business as Sun Country Airlines, Inc., and MN Airline Holdings, Inc., filed for Chapter 11 bankruptcy protection with the U.S. Bankruptcy Court for the District of Minnesota on Oct. 6, 2008 (Lead Case No. 08-45136). Petters Aviation, LLC is a wholly owned unit of Thomas Petters Inc. and owner of MN Airline Holdings, Inc., Sun Country's parent company. Polaroid Corp., which was owned by Petters since 2005, filed its second voluntary petition for Chapter 11 on Dec. 18, 2008 (Bankr. D. Minn., Lead Case No. 08-46617). PHH CORPORATION: Fitch Downgrades Issuer Default Rating to 'BB+' ---------------------------------------------------------------- Fitch Ratings has downgraded and removed from Rating Watch Negative the long-term Issuer Default Rating and related ratings of PHH Corporation. Approximately $1.73 billion in debt is affected by this action. These ratings have been downgraded, with a Negative Outlook: PHH Corporation -- Long-term IDR to 'BB+ from 'BBB+'; -- Senior unsecured debt to 'BB+ from 'BBB+'; -- Short-term IDR to 'B' from 'F2'; -- Commercial paper to 'B' from 'F2'. The downgrades reflect PHH's reduced financial flexibility as a result of the prolonged capital markets disruption and uncertainties over the company's ability to obtain longer term funding commitments. Despite PHH's good competitive position in the fleet leasing and mortgage businesses, the action reflects concerns over weaker profitability absent cost-effective, permanent sources of funding. Fitch believes the company's pursuit of interim solutions to bridge potential funding gaps are not typically consistent with an investment grade rating, although Fitch acknowledges that recent funding challenges are not unique to PHH, as all companies that rely on wholesale funding have been severely affected. The Negative Outlook reflects continued uncertainty over PHH's ability to replace or supplement the potential lost capacity under two vehicle asset-backed facilities (Chesapeake 2006-1 and 2006-2) that are scheduled to mature, unless further extended. PHH may allow one or both facilities to amortize. Projected funding needs are expected to be lower in 2009 as net investment in leases is expected to decline as the rate of vehicle orders slows relative to existing lease amortization. However, if both facilities are placed into amortization, Fitch believes the company will need to arrange funding capacity from other sources. While PHH has adequate liquidity and funding alternatives to finance its business throughout 2009, the company faces significant debt maturities within the next two years and, considering the current environment, significant refinancing risk. The bulk of the maturities relate to PHH's revolving bank facility, which is a key source of unsecured debt used to supplement secured facilities. The revolver and most mortgage related secured facilities have a minimum net worth covenant of approximately $1 billion. While the company is currently in compliance with the net worth requirement, as defined by the covenant, future volatility in reported earnings, driven in part by the revaluation of mortgage servicing rights, may test covenant limits. This risk is somewhat offset by higher mortgage production volume and resulting margins should mortgage rates decline. Should the covenant cushion decline or should PHH violate the covenant, Fitch believes any amendment or restructuring of existing facilities would be costly and require more collateral, leaving less available for unsecured creditors. Holders of the company's unsecured debt outside the bank group may also become effectively subordinated if the revolver is restructured. Fitch's current rating reflects an expectation that PHH will not violate any financial covenants and operating performance will improve modestly despite some softness in the fleet business and uncertainties in the mortgage market. Fitch will monitor the company's valuation of MSRs and its impact on meeting the net worth covenant. As such, a ratings downgrade would result if any financial covenants are breeched or the company does not succeed in finding longer term, committed financing for the fleet business. Conversely, Fitch would consider a Stable Outlook if operating performance improves substantially and PHH remains competitive under a redefined funding platform. PHILADELPHIA NEWSPAPERS: Meeting to Form Creditors Panel Today -------------------------------------------------------------- Roberta A. DeAngelis, Acting United States Trustee for Region 3, will hold an organizational meeting at 11:00 a.m. today, March 2, 2009, in the bankruptcy cases of Philadelphia Newspapers LLC and its affiliates. The meeting will be held at The Philadelphia Marriott Downtown, 1201 Market Street, Conference Room 303, in Philadelphia, Pennsylvania. The sole purpose of the meeting will be to form a committee or committees of unsecured creditors in the Debtors' cases. The organizational meeting is not the meeting of creditors pursuant to Section 341 of the Bankruptcy Code. A representative of the Debtor, however, may attend the Organizational Meeting, and provide background information regarding the bankruptcy cases. To increase participation in the Chapter 11 proceeding, Section 1102 of the Bankruptcy Code requires that the United States Trustee appoint a committee of unsecured creditors as soon as practicable. The Committee ordinarily consists of the persons, willing to serve, that hold the seven largest unsecured claims against the debtor of the kinds represented on the committee. Section 1103 of the Bankruptcy Code provides that the Committee may consult with the debtor, investigate the debtor and its business operations and participate in the formulation of a plan of reorganization. The Committee may also perform other services as are in the interests of the unsecured creditors whom it represents. Headquartered in Philadelphia, Pennsylvania, Philadelphia Newspapers LLC -- http://www.philly.com-- provide media and internet services own. The Debtors own The Inquirer, the Philadelphia Daily News, and Philly.com. The company and seven of its affiliates filed for Chapter 11 protection on February 22, 2009 (Bankr. E.D. Penn. Lead Case No. 09-11204). Proskauer Rose LLP represents the Debtors in their restructuring efforts. Lawrence G. McMichael, Esq., Dilworth Paxson LLP will serve as the Debtors' local counsel. The Debtors proposed Garden City Group Inc. as notice claims and solicitation, and Jefferies & Company Inc. as financial advisor. When the Debtors filed for protection from their creditors, they posted assets and debts between $100 million and $500 million each. PHILADELPHIA NEWSPAPERS: Taps Garden City Group as Claims Agent --------------------------------------------------------------- Philadelphia Newspapers, LLC, and its debtor-affiliates seek authority from the U.S. Bankruptcy Court for the Eastern District of Pennsylvania to employ The Garden City Group, Inc., as notice, claims and solicitation agent. GCG will provide certain noticing, claims processing and balloting administration services. In addition, GCG will provide the other noticing, claims processing, balloting and related administrative services as the Debtors or Clerk's Office may request from time to time. Jeffrey S. Stein, vice president of GCG, tells the Court that the firm received a $13,000 retainer and will apply same first against all prepetition fees and expenses and then against the last bill for fees and expenses that GCG will render in these cases. Mr. Stein assures the Court that GCG is a "disinterested person as that term is defined in Section 101(14) of the Bankruptcy Code. About Philadelphia Newspapers Philadelphia Newspapers, LLC -- http://www.philly.com/-- owns and operate numerous print and online publications in the Philadelphia market, including the Philadelphia Inquirer, the Philadelphia Daily News, several community newspapers, the region's number one local Web site, philly.com, and a number of related online products. The Company's flagship publications are the Inquirer, the third oldest newspaper in the country and the winner of numerous Pulitzer Prizes and other journalistic recognitions, and the Daily News. Philadelphia Newspapers and its debtor-affiliates filed for Chapter 11 bankruptcy protection on February 22, 2008 (Bankr. E.D. Pa. Case No. 09-11204). Proskauer Rose LLP is the Debtors' bankruptcy counsel, while Lawrence G. McMichael, Esq., at Dilworth Paxson LLP is the local counsel. The Debtors' financial advisor is Jefferies & Company Inc. The Debtors listed assets and debts of $100 million to $500 million. PHILADELPHIA NEWSPAPERS: Taps Proskauer Rose as Bankruptcy Counsel ------------------------------------------------------------------ Philadelphia Newspapers, LLC, and its debtor-affiliates seek authority from the U.S. Bankruptcy Court for the Eastern District of Pennsylvania to employ Proskauer Rose LLP as bankruptcy counsel. Proskauer Rose will: a) advice the Debtors of their powers and duties as debtors-in- possession; b) advise the Debtors regarding matters of bankruptcy law; c) advise the Debtors in proceedings and hearings in the United States District and Bankruptcy Courts for the Eastern District of Pennsylvania; d) prepare on behalf of the Debtors any necessary motions, applications, orders and other legal papers; e) provide assistance, advise and representation concerning any potential sale of the Debtors as a going concern or the sale of substantially all or a significant portion of the Debtors' assets; f) provide assistance, advice and representation concerning the confirmation of any proposed plans and solicitation of any acceptances or responding to rejections of the plan; g) provide assistance, advise and representation concerning any investigation of the assets, liabilities and financial condition of the Debtors that may be required under local, state or federal law; h) prosecute and defend litigation matters and other matters that might arise during these Chapter 11 cases; i) provide counseling and representation with respect to assumption or rejection of executory contracts and leases, sales of assets and other bankruptcy-related matters arising from these cases; j) render advice with respect to general corporate and litigation issues relating to these cases, including, but not limited to, securities, corporate finance, labor, tax and commercial matters; and k) perform other legal services as may be necessary and appropriate for the efficient and economical administration of these Chapter 11 cases. Mark K. Thomas, a member of Proskauer Rose, tells the Court that the firm's professionals' hourly rates are: Partner $490 - $975 Senior Counsel $350 - $725 Associate $180 - $650 Paraprofessionals $70 - $275 Mr. Thomas adds that the firm received advance fee payments totaling $711,923 in connection with its representation of the Debtors prior to the petition date. Mr. Thomas assures the Court that Proskauer Rose is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. Mr. Thomas can be reached at: Proskauer Rose LLP Three First National Plaza 70 West Madison, Suite 3800 Chicago IL 60602-4342 Tel: (312) 962-3550 Fax: (312) 962-3551 About Philadelphia Newspapers Philadelphia Newspapers, LLC -- http://www.philly.com/-- owns and operate numerous print and online publications in the Philadelphia market, including the Philadelphia Inquirer, the Philadelphia Daily News, several community newspapers, the region's number one local Web site, philly.com, and a number of related online products. The Company's flagship publications are the Inquirer, the third oldest newspaper in the country and the winner of numerous Pulitzer Prizes and other journalistic recognitions, and the Daily News. Philadelphia Newspapers and its debtor-affiliates filed for Chapter 11 bankruptcy protection on February 22, 2008 (Bankr. E.D. Pa. Case No. 09-11204). Proskauer Rose LLP is the Debtors' bankruptcy counsel, while Lawrence G. McMichael, Esq., at Dilworth Paxson LLP is the local counsel. The Debtors' financial advisor is Jefferies & Company Inc. The Debtors listed assets and debts of $100 million to $500 million. PHOENIX COS: S&P Puts BB+ Counterparty Credit Rating on WatchNeg. ----------------------------------------------------------------- Standard & Poor's Ratings Services said that it lowered its counterparty credit and financial strength ratings on 10 groups of U.S. life insurers and its counterparty credit ratings on seven U.S. life insurance holding companies. Standard & Poor's also said that it placed its ratings on two groups of U.S. life insurers, one of which was also downgraded, on CreditWatch with negative implications. At the same time, Standard & Poor's revised its outlook on an additional U.S. life insurer to negative from stable. In addition, S&P affirmed its ratings on two U.S. life insurers. In response to the extreme pressures in the global economy, S&P recently published criteria that outlined the incremental stress analysis S&P is now applying to U.S. insurers' bond holdings, commercial mortgages, and commercial mortgage-backed securities when S&P assess these companies' capital adequacy. The rating actions primarily reflect the incorporation of these incremental asset stress factors into S&P's capital adequacy analysis as well as the effects of severe equity market declines and volatility on earnings and capital adequacy. S&P expects that the effect of these factors will challenge life companies' competitive strengths and ability to generate profitable business. Over the past few weeks, S&P also took rating actions on several other life companies because of related issues. Within S&P's existing capital-adequacy analysis, S&P previously considered the effects of each firm's statutory impairments on fixed-income assets. The insurers affected by the rating actions had operating earnings -- on both U.S. GAAP and statutory bases -- that fell short of S&P's expectations and showed increased volatility. The depressed equity markets have driven the lower level of operating earnings, resulting in lower asset-based fees, higher costs associated with guaranteed benefits, increased write- offs of deferred acquisition costs (GAAP only), and reduced net investment income. In addition, the rating actions took into account the specific financial flexibility characteristics of each firm and their respective costs of capital given the financial markets. Given the disarray in the credit and capital markets, most insurers' financial flexibility has decreased in the past six months. The ability to access the markets varies by company and from day to day. The market dislocations are hampering two areas that S&P views as particularly important to financial flexibility: liquidity and access to the capital markets. The systemic concern regarding counterparty risk is generally heightened for financial firms. In addition, a lack of liquid markets for many securities has depressed overall access to liquidity for many corporations and financial institutions. The rating actions S&P took have incorporated these concerns. The pressures within the life sector have been building. In October 2008, S&P revised its outlook on the U.S. life insurance industry to negative from stable based on poor financial market conditions and the likelihood of a prolonged period of weaker- than-expected economic conditions. The outlook remains negative. Since October 2008, macroeconomic factors have continued to weaken, as the U.S. is in the midst of perhaps its longest recession in a generation, and S&P's economists believe it is just entering its most difficult phase. S&P's baseline economic forecast is for a deep and long recession, with a sluggish recovery beginning in mid-2009. Standard & Poor's economists are also forecasting negative GDP growth in the first half of 2009 after declines in the second half of 2008, for a total peak-to- trough decline of 3%. The dramatic rise in the expected level of corporate defaults reflects S&P's opinion of the weak credit profiles of many corporations going into this period of economic contraction. Given these difficult economic conditions, S&P believes that life insurers' bond holdings, commercial mortgages, and commercial mortgage-backed securities could experience unprecedented stress in the next 12-18 months. Although the rating actions reflect S&P's opinion of a general decline in the overall creditworthiness of the U.S. life insurance sector, S&P continues to believe the credit fundamentals of the life insurance industry are strong. S&P believes the U.S. life insurance sector remains well capitalized (even considering the incremental asset stress factors), maintains solid businesses, produces strong (albeit lower than historical) earnings, and maintains strong liquidity. The strong liquidity is paramount to S&P's opinion in determining the level of mark-to-market losses in an insurer's asset portfolio. S&P believes that strong liquidity and an insurer's willingness and ability to hold portfolio investments to maturity should provide the necessary bridge for insurers to get beyond the current distressed fixed-income markets. Nonetheless, S&P's capital adequacy analysis now quantitatively considers the projected economic losses on certain assets. Although short-term financial pressures are acute, S&P believes the industry's long-term fundamental strengths remain intact. In S&P's view, the life insurance sector remains well positioned to capture the opportunities in the retirement market. The sector also benefits -- more so than many other financial sectors -- from effective asset/liability management techniques, though current market conditions challenge the rigor of such initiatives. The recent market dislocations, in S&P's view, have challenged all enterprise risk management programs. Given the volatile equity market movements, S&P expects insurers with larger proportions of equity-related risks to improve their existing ERM programs and increase product pricing in new products. Despite the unfavorable market, S&P believes the life insurance industry is generally well positioned to meet its funding requirements. Companies are maintaining excess liquidity in these uncertain times. So far, financial leverage and coverage ratios are within tolerances for the ratings, and most have modest amounts of debt coming due in the second half of 2009 and into 2010. S&P applied the incremental stress analysis to bond holdings, commercial mortgage, and CMBS because these assets generally constitute, in aggregate, approximately 80% of U.S. life insurers' invested assets. Importantly, although S&P is not changing S&P's baseline insurance risk-based capital adequacy model, S&P is applying incremental stresses for these asset classes across all confidence levels during this difficult economic period. S&P is applying the incremental stress factors in a manner that is consistent with the approach taken in S&P's existing risk-based capital adequacy model. The incremental stresses that S&P is introducing seek to determine the amount of capital that an insurer would need to cover the calculated losses in the current economic environment at varying confidence intervals commensurate with ratings categories. S&P will continue to monitor, and possibly revise, the underlying assumptions to maintain their relevance as the events driving the credit cycle evolve. The capital adequacy outcome from the model, as well as from any stress analysis, is only a starting point for S&P's analysis of the overall capital adequacy of insurers. S&P typically apply qualitative and quantitative considerations as warranted to derive a more complete picture of an insurer's capital position. Similarly, S&P generally base its ratings on a broad-based analysis of an insurer's credit quality. Strengths or weaknesses in other key areas -- such as a company's competitive position, management and strategy, investment risk, liquidity risk, operating performance, enterprise risk management, and financial flexibility -- could in some cases more than offset relative strength or weakness in capital adequacy. In addition to the asset stress factors, the rating actions reflect a general overall decline in these major rating factors. S&P views these areas of analysis as being interconnected, and their importance and influence on a rating will differ depending on company-specific circumstances. S&P provides ratings on insurance companies in many parts of the world, and in the process, S&P encounter many different accounting frameworks. S&P's capital model is designed under a globally consistent framework by incorporating regional factors unique to a local market. It is an ongoing objective of Standard & Poor's to normalize the resulting capital measures on a basis that is consistent with U.S. statutory or GAAP/International Financial Reporting Standards accounting. For example, and subject to analytical judgment, S&P generally will not apply incremental stresses to the baseline insurance risk-based capital model when current values are reported on a marked-to-market basis because the figures already reflect the sharp declines in fair value, which in some cases exceed S&P's expectations. S&P could expand its analysis to include additional asset classes as the market conditions continue to evolve, updated information becomes available, and material losses emerge. Standard & Poor's will hold discussions with the companies with ratings on CreditWatch and maintain active surveillance of companies with negative outlooks to determine if any downgrades are warranted. S&P will also continue to evaluate the entire industry to determine which companies are susceptible to rapid and sustained change in stock or bond valuations and the overall impact on any such change on S&P's view of their financial flexibility. Given the current environment, S&P also could develop other incremental stress tests, such as assessing the potential impact of policyholder behavior in guaranteed annuity contracts, which could also affect ratings. In all cases, if actual experience is better than stress-test expectations, subsequent favorable rating actions could result. S&P has focused on U.S. life insurers in these rating actions, as a recent review of all U.S. insurers and the application of the enhanced criteria on the incremental asset stress factors reflects minimal capital adequacy impact to U.S. property/casualty and health insurers. In reviewing the initial results of the incremental stress analysis for these insurance sectors, S&P believes at this time that rating changes are unlikely in the immediate future. Summary Ratings List Americo Life Inc. To From -- ---- Counterparty Credit Rating Local Currency BBB-/Watch Neg/-- BBB- /Stable/-- Americo Financial Life & Annuity Insurance Co. To From -- ---- Counterparty Credit Rating Local Currency A-/Watch Neg/-- A- /Stable/-- Financial Strength Rating Local Currency A-/Watch Neg/-- A- /Stable/-- Conseco Inc. To From -- ---- Counterparty Credit Rating Local Currency CCC/Negative/-- B+/Negative/-- Conseco Inc.'s Core Insurance Operating Companies To From -- ---- Counterparty Credit Rating Local Currency BB-/Negative/-- BB+/Negative/-- Financial Strength Rating Local Currency BB-/Negative/-- BB+/Negative/-- Genworth Financial Inc. To From -- ---- Counterparty Credit Rating Local Currency BBB/Negative/A-2 A- /Negative/A-2 Genworth Financial Inc.'s Core Insurance Operating Companies* To From -- ---- Counterparty Credit Rating Local Currency A/Stable/-- AA- /Negative/-- Financial Strength Rating Local Currency A/Stable/-- AA- /Negative/-- * Some operating companies have 'A-1' short-term ratings. Hartford Financial Services Group Inc. To From -- ---- Counterparty Credit Rating Local Currency BBB+/Watch Neg/A-2 A-/Watch Neg/A-2 Hartford Financial Services Group Inc.'s Core Insurance Operating Companies* To From -- ---- Counterparty Credit Rating Local Currency A+/Watch Neg/-- AA-/Watch Neg/-- Financial Strength Rating Local Currency A+/Watch Neg/-- AA-/Watch Neg/-- * Some operating companies have 'A-1' short-term ratings. Lincoln National Corp. To From -- ---- Counterparty Credit Rating Local Currency A-/Stable/A-2 A+/Negative/A-1 Lincoln Nation Corp.'s Core Insurance Operating Companies To From -- ---- Counterparty Credit Rating Local Currency AA-/Stable/-- AA/Stable/-- Financial Strength Rating Local Currency AA-/Stable/-- AA/Stable/-- MetLife Inc. To From -- ---- Counterparty Credit Rating Local Currency A-/Negative/A-2 A/Stable/A-1 MetLife Inc.'s Core Insurance Operating Companies* To From -- ---- Counterparty Credit Rating Local Currency AA-/Negative/-- AA/Stable/-- Financial Strength Rating Local Currency AA-/Negative/-- AA/Stable/-- * Some operating companies have 'A-1+' short-term ratings. Midland National Life Insurance Co. North American Co. for Life & Health Insurance To From -- ---- Counterparty Credit Rating Local Currency A+/Stable/-- AA- /Negative/-- Financial Strength Rating Local Currency A+/Stable/-- AA- /Negative/-- Pacific LifeCorp To From -- ---- Counterparty Credit Rating Local Currency A-/Negative/-- A/Stable/-- Pacific LifeCorp's Core Insurance Operating Companies To From -- ---- Counterparty Credit Rating Local Currency AA-/Negative/-- AA/Stable/-- Financial Strength Rating Local Currency AA-/Negative/-- AA/Stable/-- Protective Life Corp. To From -- ---- Counterparty Credit Rating Local Currency A-/Stable/-- A/Stable/-- Protective Life Corp.'s Core Insurance Operating Companies To From -- ---- Counterparty Credit Rating Local Currency AA-/Stable/-- AA/Stable/-- Financial Strength Rating Local Currency AA-/Stable/-- AA/Stable/-- Prudential Financial Inc. To From -- ---- Counterparty Credit Rating Local Currency A/Stable/A-1 A/Negative/A-1 Prudential Financial Inc.'s Core Operating Companies* To From -- ---- Counterparty Credit Rating Local Currency AA-/Stable/-- AA/Negative/-- Financial Strength Rating Local Currency AA-/Stable/-- AA/Negative/-- * Some operating companies have 'A-1+' short-term ratings. Security Mutual Life Insurance Co. of NY To From -- ---- Counterparty Credit Rating Local Currency A-/Negative/-- A+/Negative/-- Financial Strength Rating Local Currency A-/Negative/-- A+/Negative/-- Symetra Financial Corp. To From -- ---- Counterparty Credit Rating Local Currency BBB/Negative/-- BBB/Stable/-- Symetra Financial Corp.'s Core Operating Companies* To From -- ---- Counterparty Credit Rating Local Currency A/Negative/-- A/Stable/-- Financial Strength Rating Local Currency A/Negative/-- A/Stable/-- Ratings Affirmed Ohio National Financial Services Inc. Counterparty Credit Rating Local Currency A/Stable/-- Ohio National Financial Services Inc.'s Core Operating Companies Counterparty Credit Rating Local Currency AA/Stable/-- Financial Strength Rating Local Currency AA/Stable/-- OneAmerica Financial Partners Inc. Counterparty Credit Rating Local Currency A-/Stable/-- American United Life Insurance Co. Counterparty Credit Rating Local Currency AA-/Stable/-- Financial Strength Rating Local Currency AA-/Stable/-- State Life Insurance Co. Financial Strength Rating Local Currency AA-/Stable/-- Other Recent Rating Actions Because Of Related Issues AEGON N.V. To From -- ---- Counterparty Credit Rating Local Currency A+/WatchNeg/A-1 A+/Negative/A-1 AEGON N.V.'s Core Insurance Operating Companies* To From -- ---- Counterparty Credit Rating Local Currency AA/WatchNeg/-- AA/Negative/-- Financial Strength Rating Local Currency AA/WatchNeg/-- AA/Negative/-- * Some operating companies have 'A-1+' short-term ratings. AFLAC Inc. To From -- ---- Counterparty Credit Rating Local Currency A-/WatchNeg/-- A/Stable/-- AFLAC Inc.'s Core Insurance Operating Companies To From -- ---- Counterparty Credit Rating Local Currency AA-/WatchNeg/-- AA/Stable/-- Financial Strength Rating Local Currency AA-/WatchNeg/-- AA/Stable/-- AXA Financial Inc To From -- ---- Counterparty Credit Rating Local Currency A+/Negative/-- A+/Stable/-- AXA's Core Insurance Operating Companies* To From -- ---- Counterparty Credit Rating Local Currency AA/Negative/- AA/Stable/-- Financial Strength Rating Local Currency AA/Negative/- AA/Stable/-- * Some operating companies have 'A-1+' short-term ratings. FBL Financial Group Inc. To From -- ---- Counterparty Credit Rating Local Currency BBB-/Negative/-- BBB/WatchNeg/-- FBL Financial Group Inc.'s Core Insurance Operating Companies To From -- ---- Counterparty Credit Rating Local Currency A-/Negative/-- A/WatchNeg/-- Financial Strength Rating Local Currency A-/Negative/-- A/WatchNeg/-- Manulife Financial To From -- ---- Counterparty Credit Rating Local Currency AA-/Stable/-- AA/Negative/-- Manulife Core Insurance Operating Companies To From -- ---- Counterparty Credit Rating Local Currency AA+/Stable/-- AAA/Negative/-- Financial Strength Rating Local Currency AA+/Stable/-- AAA/Negative/-- Phoenix Cos. Inc. To From -- ---- Counterparty Credit Rating Local Currency BB+/WatchNeg/-- BB+/Negative/-- Phoenix Cos. Inc.'s Core Insurance Operating Companies To From -- ---- Counterparty Credit Rating Local Currency BBB+/WatchNeg/-- BBB+/Negative/-- Financial Strength Rating Local Currency BBB+/WatchNeg/-- BBB+/Negative/-- Principal Financial Group Inc. To From -- ---- Counterparty Credit Rating Local Currency A-/Negative/-- A/WatchNeg/-- Principal Life Insurance Co.'s Core Insurance Operating Companies* To From -- ---- Counterparty Credit Rating Local Currency AA-/Negative/-- AA/WatchNeg/-- Financial Strength Rating Local Currency AA-/Negative/-- AA/WatchNeg/-- * Some operating companies have 'A-1+' short-term ratings. Security Benefit Life Insurance Co. To From -- ---- Counterparty Credit Rating Local Currency BB/Negative/-- BBB+/Negative/-- Financial Strength Rating Local Currency BB/Negative/-- BBB+/Negative/-- SunLife Financial To From -- ---- Counterparty Credit Rating Local Currency AA-/Watch Neg/A-1+ AA- /Stable/A-1+ Sun Life's Core Insurance Operating Companies* To From -- ---- Counterparty Credit Rating Local Currency AA+/WatchNeg/-- AA+/Stable/-- Financial Strength Rating Local Currency AA+/WatchNeg/-- AA+/Stable/-- * Some operating companies have 'A-1+' short-term ratings. PILGRIM'S PRIDE: To Idle Three Chicken Processing Plants -------------------------------------------------------- Pilgrim's Pride Corporation plans to idle three of its 32 U.S. chicken processing plants by mid-May as part of its reorganization. The idling of these three underperforming plants is intended to improve the company's product mix by reducing commodity production and to significantly reduce its costs in the midst of an industry-wide oversupply of chicken and weak consumer demand resulting from a national recession. The plants that the company plans to idle within 60 to 75 days are located in Douglas, Ga.; El Dorado, Ark.; and Farmerville, La. These plants employ a total of approximately 3,000 people -- or roughly 7 percent of the company's total U.S. workforce. Pilgrim's Pride will provide transition programs to employees whose positions are eliminated to assist them in securing new employment, filing for unemployment and obtaining other applicable benefits. Approximately 430 independent contract growers who supply birds to these three plants also will be affected. There will not be any disruption in the supply of product to retail, foodservice and industrial customers as a result of the idling of these plants, since these changes will only eliminate production of excess commodity chicken. The company plans to keep the plants idle until it believes that additional production capacity is needed. Pilgrim's Pride expects to generate annualized net savings of approximately $110 million from idling these three plants and to incur one-time, pre-tax restructuring charges of approximately $35 million, before any potential asset impairment charges, primarily in the second quarter of fiscal 2009. This includes approximately $8 million of estimated non-cash restructuring costs. "The idling of these three plants is a painful reflection of the unprecedented challenges facing our company and our industry from an excess supply of chicken and weakening consumer demand resulting from a crippled economy," said Don Jackson, president and chief executive officer. "Simply put, we are producing too much commodity chicken in what is a very weak market. The actions announced today will reduce our production of low-value, commodity meat that is a financial drain on the company without affecting any of our core business lines or customers." The idling of these three plants, when completed, will result in a reduction of 9-to-10 percent in total pounds of chicken produced by the company. In addition, the company will be consolidating its protein salad production from Franconia, Pa. to its further-processing facility in Moorefield, W. Va. "We recognize the pain and uncertainty that the idling of these plants will have on our employees and growers at these locations, as well as on the surrounding communities. It is a devastating situation, and we sincerely wish that such actions were not necessary," Dr. Jackson said. "But the reality is that our country is arguably facing the most significant financial crisis since the Great Depression, with consumer spending on food dropping at its steepest rate in more than 60 years. We are taking decisive steps now to protect the greatest number of jobs and growers in order to restructure our business and ultimately emerge from Chapter 11 as a stronger, more efficient competitor." About Pilgrim's Pride Corp. Headquartered in Pittsburgh, Texas, Pilgrim's Pride Corporation (NYSE: PPC) -- http://www.pilgrimspride.com/-- produces, distributes and markets poultry processed products through retailers, foodservice distributors and restaurants in the U.S., Mexico and in Puerto Rico. In addition, the company owns 34 processing plants in the United States and 3 processing plants n Mexico. The processing plants are supported by 42 hatcheries, 31 feed mills and 12 rendering plants in the United States and 7 hatcheries, 4 feed mills and 2 rendering plants in Mexico. Moreover, the company owns 12 prepared food production facilities in the United States. The company employs about 40,000 people and has major operations in Texas, Alabama, Arkansas, Georgia, Kentucky, Louisiana, North Carolina, Pennsylvania, Tennessee, Virginia, West Virginia, Mexico, and Puerto Rico, with other facilities in Arizona, Florida, Iowa, Mississippi and Utah. Pilgrim's Pride Corp. and six other affiliates filed Chapter 11 petitions on December 1, 2008 (Bankr. N.D. Tex. Lead Case No. 08-45664). The Debtors' operations in Mexico and certain operations in the United States were not included in the filing and continue to operate as usual outside of the Chapter 11 process. Pilgrim's Pride has engaged Stephen A. Youngman, Esq., Martin A. Sosland, Esq., and Gary T. Holzer, Esq., at Weil, Gotshal & Manges LLP, as bankruptcy counsel. The Debtors have also tapped Baker & McKenzie LLP as special counsel. Lazard Freres & Co., LLC is the company's investment bankers and William K. Snyder of CRG Partners Group LLC as chief restructuring officer. The company's claims and noticing agent is Kurtzman Carson Consulting LLC. A nine-member committee of unsecured creditors has been appointed in the case. As of December 27, 2008, the Company had $3,215,103,000 in total assets, $612,682,000 in total current liabilities, $225,991,000 in total long-term debt and other liabilities, and $2,253,391,000 in liabilities subject to compromise. Bankruptcy Creditors' Service, Inc., publishes Pilgrim's Pride Bankruptcy News. The newsletter tracks the chapter 11 proceeding of Pilgrim's Pride Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) PRECISION PARTS: Gets Short Delay to Auction Process ---------------------------------------------------- At the behest of Precision Parts International Services Corp., and its debtor- affiliates, the U.S. Bankruptcy Court for the District of Delaware extended the bidding process for substantially all of their assets. According to Bloomberg's Bill Rochelle, the Court extended (a) the deadline for the submission of bids from Feb. 20, 2009, to March 6, at 4:00 p.m.; (b) the date of the auction from Feb. 23, to March 9, 2009, at 1:00 p.m.; and (c) the hearing to consider the Sale Motion from Feb. 25, to March 10. The Debtors, in the same document seeking a slight delay on the bidding schedule, said that Cerion LLC has offered to pay $18,500,000 for their assets, payable as follows. The Debtors have selected Cerion as stalking horse bidder, and have sought permission to entitle Cerion to a $500,000 break-up fee, in the event another bid is selected at the auction. About Precision Parts Headquartered in Rochester Hills, Michigan, Precision Parts International Services Corp. -- http://www.precisionparts.com/ -- sells products to major north American automotive and non- automotive original equipment manufacturers and Tier 1 and 2 suppliers. The Debtors operate six manufacturing facilities throughout north America, including a facility in Mexico operated on the Debtors' behalf by Intermex Manufactura de Chihuahua under a shelter and logistics agreement. The Debtors' operations consist of two distinct lines of business: MPI, which performs fineblanking work and conventional metal stamping, as well as a range of value-added finishing operations, and Skill which performs conventional metal stamping, as well as a range of assembly and value-added finishing operations. Four of the Debtors are holding companies that have no employees and are not involved in the Debtors' day-to-day operations: PPI Holdings, Inc.; PPI Sub-Holdings, Inc.; MPI International Holdings, Inc.; and Skill Tool & Die Holdings Corp. The Company and eight of its affiliates filed for Chapter 11 protection on Dec. 12, 2008 (Bankr. D. Del. Lead Case No. 08-13289). David M. Fournier, Esq., at Pepper Hamilton LLP; and Robert S. Hertzberg, Esq., and Deborah Kovsky-Apap, Esq., at Pepper Hamilton LLP, represent the Debtors in their restructuring efforts. The Debtors proposed Alvarez & Marsal North America LLC as financial advisor and Kurtzman Carson Consultants LLC as notice, claims and balloting agent. When the Debtors filed for protection from their creditors, they listed assets of between $100 million to $500 million each. PRIMUS FINANCIAL: S&P Affirms 'BB+' Rating on Preferred Stock ------------------------------------------------------------- Standard & Poor's Ratings Services lowered its issuer credit rating on Primus Financial Products LLC, a credit derivative product company, to 'A' from 'A+' and removed it from CreditWatch, where it was originally placed with negative implications on Sept. 26, 2008. Concurrently, S&P assigned a negative outlook to Primus. At the same time, S&P affirmed its ratings on Primus' senior debt issues, senior subordinated debt issues, and preferred shares, and removed them from CreditWatch with negative implications, where they were also placed on Sept. 26, 2008. The lowered rating reflects the issuer credit rating's failure to pass the 'A+' rating capital test, according to Primus' capital model run result in the most recent report provided by the company. According to the report, Primus' issuer credit rating still passed the 'A' rating capital test by approximately $4 million. In the capital model run, S&P assume that Primus has to make a termination payment of approximately $51.5 million on the credit default swaps with Lehman Bros. Special Financing Inc. (the counterparty), and this approach is consistent with S&P's ratings criteria for credit derivative product companies published Nov. 5, 2005. The current increased capital requirement reflects additional downgrades in the issuer's credit portfolio. Primus has not experienced a new credit event since S&P's last update on Dec. 17, 2008. According to Primus' operating guidelines, Primus will formally transition from a "normal" mode of operations to a "continuation" mode of operations when the issuer credit rating falls below 'A+'. According to program documents, in the continuation mode, Primus will cease entering into new credit default swaps other than risk reducing swaps. Prior to February 26, however, Primus has voluntarily been operating in a continuation mode in an effort to conserve capital in the current environment. According to program documentation, entering continuation mode requires Primus' board of directors to determine who the manager will be as the swap portfolio amortizes. S&P has been informed that the board has elected to retain Primus Asset Management Inc., the current manager, as the continuation manager. S&P had previously left its ratings on Primus and its debt on CreditWatch with negative implications because recoveries had not yet been finalized on existing credit events that had occurred in the portfolio. S&P is now removing the ratings from CreditWatch negative because Primus' credit default swaps that have experienced credit events have been settled. Given the small margin with which Primus is passing its capital model test, it is likely that additional downgrades in the credit risk portfolio would warrant further rating action or renewed CreditWatch placements. S&P assigned a negative outlook to Primus because S&P believes that the fundamental economic and business condition for this fully ramped credit derivative product company that sells credit protection mainly on single-name credits has greatly changed since S&P originally rated it. S&P will continue to monitor Primus and update S&P's opinion on the company as S&P continue to receive updated reports from Primus. Rating Lowered And Off Watch Negative, Outlook Assigned Primus Financial Products LLC Rating ------ To From -- ---- Issuer credit rating A/Negative A+/Watch Neg Ratings Affirmed And Off Creditwatch Negative Primus Financial Products LLC Rating ------ To From -- ---- Senior debt issues A- A-/Watch Neg Senior subordinated debt issues BBB BBB/Watch Neg Preferred shares BB+ BB+/Watch Neg QIMONDA RICHMOND: Organizational Meeting to Form Panel on March 5 ----------------------------------------------------------------- Roberta A. DeAngelis, Acting United States Trustee for Region 3, will hold an organizational meeting on March 5, 2009, at 9:30 a.m. in the bankruptcy cases of Qimonda Richmond LLC and its affiliates. The meeting will be held at J. Caleb Boggs Federal Building, 844 King Street, Room 2112, in Wilmington. The sole purpose of the meeting will be to form a committee or committees of unsecured creditors in the Debtors' cases. The organizational meeting is not the meeting of creditors pursuant to Section 341 of the Bankruptcy Code. A representative of the Debtor, however, may attend the Organizational Meeting, and provide background information regarding the bankruptcy cases. To increase participation in the Chapter 11 proceeding, Section 1102 of the Bankruptcy Code requires that the United States Trustee appoint a committee of unsecured creditors as soon as practicable. The Committee ordinarily consists of the persons, willing to serve, that hold the seven largest unsecured claims against the debtor of the kinds represented on the committee. Section 1103 of the Bankruptcy Code provides that the Committee may consult with the debtor, investigate the debtor and its business operations and participate in the formulation of a plan of reorganization. The Committee may also perform other services as are in the interests of the unsecured creditors whom it represents. About Qimonda Richmond, LLC Qimonda Richmond, LLC makes semiconductor products. The Debtor and its debtor-affiliate filed for separate Chapter 11 protection on Feb. 20, 2009, (Bankr. D. Del. Case Nos. 09-10589 to 09-10590) Simpson Thacher & Bartlett LLP and Mark D. Collins, Esq. and Michael Joseph Merchant, Esq., at Richards Layton & Finger PA represent the Debtors in their restructuring efforts. Alvarez & Marsal serves as restructuring managers. Epiq Bankruptcy Solutions LLC serves as its claims agent. The Debtors listed estimated assets of more than $1 billion and estimated debts of more than $1 billion. QIMONDA RICHMOND: Wants to Hire Epiq as Claims and Noticing Agent ----------------------------------------------------------------- Qimonda Richmond, LLC, and its debtor-affiliates seek authority from the U.S. Bankruptcy Court for the District of Delaware to employ Epiq Bankruptcy Solutions, LLC, as claims processing and noticing agent. Epiq will act as the official claims agent of the Bankruptcy Clerk in order to assume full responsibility for the distribution of notices and proofs of claim, and maintenance, processing and docketing of proofs of claim filed in the Chapter 11 cases, and to: a) prepare and service required notices in the Chapter 11 cases; b) at any time, upon request, satisfy the Court that it has the capability to efficiently and effectively notice, docket, and maintain proofs of claim and proofs of interest; c) file with the Clerk's Office certificates and affidavits of service that include a copy of the particular notice involved, an alphabetical list of persons to whom the notice was mailed, and the date of the mailing; d) maintain copies of all proofs of claim and proofs of interest filed; e) maintain official claims registers by docketing all proofs of claim and proofs of interest on claims registers; f) implement necessary security measures to ensure the completeness and integrity of the claims register; g) maintain all original proofs of claim in correct claim number order, in an environmentally secure area and protect the integrity of the original documents from theft and alteration; h) transmit to the Clerk's Office a copy of the claims register on a regular basis; i) maintain an up-to-date mailing list for all entities that have filed a proof of claim or proofs of interest, which list will be available upon request of a party-in-interest or the Clerk's Office; j) provide access to the public for examination of copies of proofs of claim or interest during regular business hours; k) record all transfers of claims and provide notice of the transfer; l) promptly comply with such further conditions and requirements as the Clerk's office or the Court may at any time prescribe; and m) perform other administrative and support services related to noticing, claims, docketing, solicitation and distribution as the Debtors or the Clerk's Office may request. Daniel C. McElhinney, executive director of Epiq, tells the Court that the firm's professionals' hourly rates are: Title Rate Range Average Rate _____ __________ ____________ Clerk $40 - $60 $50.00 Case Manager (Level 1) $125 - $175 $142.50 IT Programming Consultant $140 - $190 $165.00 Case Manager (Level 2) $185 - $220 $202.50 Senior Case Manager $225 - $275 $247.50 Senior Consultant TBD TBD* The level of the senior consultant will vary by engagement. If the services are required, the usual average rate is $295 per hour. Mr. McElhinney assures the Court that Epiq is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Qimonda Richmond, LLC Qimonda Richmond, LLC makes semiconductor products. The Debtor and its debtor-affiliate filed for separate Chapter 11 protection on Feb. 20, 2009, (Bankr. D. Del. Case Nos.: 09-10589 to 09-10590) Simpson Thacher & Bartlett LLP and Mark D. Collins, Esq. and Michael Joseph Merchant, Esq. at Richards Layton & Finger PA represent the Debtors in their restructuring efforts. Alvarez & Marsal serves as restructuring managers. Epiq Bankruptcy Solutions LLC serves as its claims agent. The Debtors listed estimated assets of more than $1 billion and estimated debts of more than $1 billion. QUEBECOR WORLD: Hiring Credit Suisse to Syndicate $750MM Loan ------------------------------------------------------------- Quebecor World Inc. and its affiliates, which have been in bankruptcy protection in Canada and the United States for more than 13 months, are in negotiations with unsecured creditors, noteholders and agents of their DIP lenders with respect to a plan of reorganization in their Chapter 11 cases in the United States and a plan of comprise in their Canadian proceedings. To that end, Quebecor World engaged in discussions with Credit Suisse Securities (USA) LLC for potential sources of bankruptcy exit financing. In a motion submitted to the U.S. Bankruptcy Court for the Southern District of New York, Quebecor World seeks authorization to enter into an engagement letter to tap Credit Suisse as bookrunner and lead arranger for a $750 million financing to take effect at the time the Reorganization Plan is declared effective. The senior secured credit facilities will consist of any combination of: (a) term financing in the aggregate principal amount of $300 million to $400 million (less the amount of any debt securities issued by the Debtors and/or QWI); and (b) a senior secured asset-based revolving credit facility (with a letter of credit subfacility) in an aggregate principal amount of $350 million to $450 million. Quebecor World has agreed to pay Credit Suisse an arrangement fee, a work fee and an agency fee, and reimburse reasonable out-of- pocket expenses. The Debtor redacted the amounts of the fees from the engagement letter posted at the court docket. 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. R.A.E.D. INVESTMENTS: Has $220K Offer for Pittsburgh Property ------------------------------------------------------------- Steven Owens and Shawn Owens have offered to pay $220,000 to purchase property located at 156-160 S. 16th Street in Pittsburgh, Pennsylvania from R.A.E.D. Investments, Inc. Subject to higher and better offers, the Debtor asks the Honorable Judith K. Fitzgerald to approve a sale transaction on March 13, 2009, at 12:00 noon. The debtor intends to sell the property on an "as is, where is" basis, free and clear of all mortgages, liens and encumbrances. Competing offers, if any, must be filed with the Court on or before March 9, 2009, and a copy must be served on the Debtors' lawyer: Andrew M. Gross, Esq. 210 Grant Street, Suite 401 Pittsburgh, PA 15219 Telephone (412) 553-0140 R.A.E.D. Investments, Inc., filed a chapter 11 petition (Bankr. W.D. Pa. Case No. 09-20016) on January 2, 2009, estimating total assets and liabilities in the $1 million to $10 million range. REALOGY CORP: $150MM Investment Won't Affect Moody's Rating ----------------------------------------------------------- Moody's Investors Service said that Realogy Corporation's recent announcement that its private equity sponsor, Apollo Management, L.P., may invest up to $150 million in the company during fiscal 2009 will have no immediate impact on Realogy's credit ratings, liquidity rating or the negative rating outlook. The last rating action on Realogy Corporation was on December 19, 2008, at which time Moody's lowered the corporate family rating to Caa3 from Caa2 following the company's withdrawal of an exchange offer to holders of its senior unsecured cash pay, unsecured toggle and subordinated notes. Realogy is one of the largest real estate service companies in the United States with reported revenues of about $4.7 billion for the year ended December 31, 2008. RITZ CAMERA: Organizational Meeting to Form Panel on March 3 ------------------------------------------------------------ Roberta A. DeAngelis, Acting United States Trustee for Region 3, will hold an organizational meeting on March 3, 2009, at 11:00 a.m. in the bankruptcy cases of Ritz Camera Centers, Inc. The meeting will be held at Hotel DuPont, 11th & Market Streets, Greenville & Newark Rooms in Wilmington. The sole purpose of the meeting will be to form a committee or committees of unsecured creditors in the Debtors' cases. The organizational meeting is not the meeting of creditors pursuant to Section 341 of the Bankruptcy Code. A representative of the Debtor, however, may attend the Organizational Meeting, and provide background information regarding the bankruptcy cases. To increase participation in the Chapter 11 proceeding, Section 1102 of the Bankruptcy Code requires that the United States Trustee appoint a committee of unsecured creditors as soon as practicable. The Committee ordinarily consists of the persons, willing to serve, that hold the seven largest unsecured claims against the debtor of the kinds represented on the committee. Section 1103 of the Bankruptcy Code provides that the Committee may consult with the debtor, investigate the debtor and its business operations and participate in the formulation of a plan of reorganization. The Committee may also perform other services as are in the interests of the unsecured creditors whom it represents. Headquartered in Beltsville, Maryland, Ritz Camera Centers Inc. -- http://www.ritzcamera.com-- sells digital cameras and accessories, and electronic products. The company filed for Chapter 11 protection on February 22, 2009 (Bankr. D. Del. Case No. 09-10617). Karen M. McKinley, Esq., and Norman L. Pernick, Esq., at Cole Scholtz Meisel Forman Leonard, P.A., represent the Debtor in its restructuring efforts. The Debtor proposed Thomas & Libowitz PA as corporate counsel; FTI Consulting Inc. t/a FTI Palladium Partners as financial advisor; and Kurtzman Carson Consultants LLC as claims agent. When the Debtor filed for protection from its creditors, it listed assets and debts between $100 million and $500 million. ROCK-TENN COMPANY: Moody's Raises Ratings on Sr. Notes to 'Ba1' --------------------------------------------------------------- Moody's Investors Service revised Rock-Tenn Company's rating outlook to stable from negative and upgraded the company's senior secured credit facilities rating to Ba1 from Ba2. At the same time, Moody's affirmed Rock Tenn's Ba2 corporate family rating, the Ba3 rating on the 2011 and 2013 senior notes, the Ba3 senior unsecured note rating and assigned an SGL-2 speculative grade liquidity rating. Rock Tenn's revised outlook was prompted by the progress Rock Tenn has made in the integration of the March 2008 Southern Container acquisition, management's commitment to debt reduction, the company's improved credit protection metrics and the expectation of continued strong financial performance. The integration of the Southern Container acquisition, which increased the company's debt position significantly, has been successful, with the company exceeding its initial synergy and financial performance targets. Rock Tenn has reduced gross debt by approximately $250 million over the past 10 months and management is currently ahead of its debt reduction target. Despite the economic slowdown, the company's low cost mill system and management's cost reduction efforts have helped improve margins and cash flow. Through ongoing free cash flow generation, credit protection metrics and operating margins have improved to levels commensurate with the current Ba2 corporate family rating. Moody's expects the company's credit protection metrics to continue to improve as management achieves further operational synergies and continues to reduce debt from operating cash flow. Moody's upgraded the ratings on Rock Tenn's senior secured credit facilities one notch to Ba1 as a result of enhanced guarantee and security arrangements. The payment of the Solvay Paperboard industrial development revenue bonds allowed Solvay Paperboard LLC to provide an upstream guarantee and pledge collateral to the senior secured credit facilities, which improve their expected recovery in the event of a default. Although the 2011 and 2013 senior notes also received some additional collateral from Solvay Paperboard LLC, it was not material enough to improve the rating. Note that the 2011 and 2013 senior notes do not benefit from up- stream guarantees. Downgrades: Issuer: Rock-Tenn Company -- Senior Unsecured Regular Bond/Debenture, Downgraded to a range of LGD5,78% to LGD4, 68% from a range of LGD4,67% to LGD4, 63% Upgrades: Issuer: Rock-Tenn Company -- Senior Secured Bank Credit Facility, Upgraded to a range of Ba1, LGD3, 38% from a range of Ba2, LGD3, 45% Assignments: Issuer: Rock-Tenn Company -- Speculative Grade Liquidity Rating, Assigned SGL-2 Outlook Actions: Issuer: Rock-Tenn Company -- Outlook, Changed To Stable From Negative Rock Tenn's Ba2 corporate family rating reflects the company's low cost vertically integrated asset base, its position as one of the largest producers of folding cartons and promotional point-of- purchase displays in North America, the company's strong financial performance and its good committed liquidity arrangements. The company has a strong ability to manage its costs with its modern, well-invested mill system that is significantly forward integrated into converting plants. Most of the company's products are supplied to the consumer non-durable end markets (primarily food) which are stable and more resilient to weak economic conditions. Offsetting these strengths are the company's lack of product and geographic diversification, volatile input costs, including currently high virgin fiber and chemical costs, and declining demand for packaging. The SGL-2 liquidity rating indicates that Rock Tenn has a good liquidity profile supported by expectations of positive free cash flow generation over the next four quarters with no significant near-term debt maturities, sufficient availability under its credit facilities, and expectations that compliance with financial covenants will not pose a problem for the next four quarters. Moody's last rating action was on January 29, 2008, when a Ba2 rating was assigned to Rock Tenn's new senior secured credit facilities and a Ba3 rating was assigned to the company's new senior unsecured notes. Headquartered in Norcross, Georgia, Rock Tenn is a manufacturer of packaging products, containerboard, merchandising displays, and bleached and recycled paperboard. The company had annual net sales of approximately $2.8 billion in its fiscal year ending September 30, 2008, and has operating locations in the United States, Canada, Mexico, Chile and Argentina. RYLAND GROUP: R. Chad Dreier to Leave CEO Post, Remains in Board ---------------------------------------------------------------- The Ryland Group, Inc., reported that R. Chad Dreier will retire as chief executive officer on May 29, 2009. Mr. Dreier will continue in his role as chairperson of the board of directors. Effective May 29, 2009, Larry Nicholson will be promoted to the position of chief executive officer becoming president and chief executive officer of Ryland. "I am very excited about this orderly transition in the leadership of our company and am grateful for the support given to me by the board of directors in making this transition possible," said Mr. Dreier. "Over the course of his 12 years with Ryland, Larry has clearly demonstrated his ability to assume the responsibilities of chief executive officer. With Larry as president and chief executive officer, I look forward to continuing as chairman of the board of directors as we continue to work through this challenging time in the homebuilding industry." "We are grateful for Chad's leadership and the many record milestones achieved by Ryland during the 15 years he guided this company as chief executive officer," said Lead Director of the board of directors, Bill Jews. "We look forward to Larry's transition into the role of chief executive officer and his leadership in determining Ryland's future direction as a leading national homebuilder." Mr. Dreier joined Ryland in November 1993 as president and chief executive officer, becoming chairperson of the board of directors in December 1994. With more than 25 years of experience in the homebuilding industry, Mr. Nicholson joined Ryland in 1996 as a vice president of operations and subsequently ran the Greenville, S.C. and Orlando divisions before his promotion to Southeast region president in 2004. He was promoted to chief operating officer in June 2007 and president in September 2008. 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. * * * As of December 31, 2008, the Company's balance sheet showed total assets of $1,862,988,000, total liabilities of $1,123,810,000, minority interest of $13,816,000, resulting in total stockholders' equity of $725,362,000. 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. The TCR reported on Nov. 28, 2008, that Moody's Investors Service downgraded all of the ratings of The Ryland Group, Inc., including its corporate family rating to Ba3 from Ba2, its probability of default rating to Ba3 from Ba2, and its senior notes rating to Ba3 from Ba2. At the same time, Moody's affirmed the Company's speculative grade liquidity rating at SGL-3. The outlook remains negative. RYNESS COMPANY: Case Summary & 28 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: The Ryness Company, Inc. 801 San Ramon Valley Boulevard Danville, CA 94526 Tel: (925) 820-3432 Bankruptcy Case No.: 09-41466 Type of Business: The Debtor is a holding company. Chapter 11 Petition Date: February 26, 2009 Court: Northern District of California (Oakland) Debtor's Counsel: James S. Monroe, Esq. jim@monroe-law.com Monroe Law Group 101 California St. #2450 San Francisco, CA 94111 Tel: (415)990-4349 Estimated Assets: Less than $50,000 Estimated Debts: $10 million to $50 million The Debtor's Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Adrienne Albert loan $5,500,00 923 5th Ave., Apt. 11A New York, NY 10021 Tel: (917) 449-8822 David Tufts deferred $700,000 2959 Andrews Drive NW compensation Atlanta, GA 30305 Tel: (404) 812-1850 Sixth & Virginia Properties premises lease $411,502 Attn: A. M. Clise 2001 Sixth Avenue Suite 300 Seattle, WA 98121 Tel: (206) 433-1800 Ikon Financial Services equipment lease $548,000 Hanley Wood LLC settlement $312,000 801 Partnership premises lease $250,313 Western Pacific Housing contract $193,000 American Assets Inc. premises lease $154,281 AICCO loan $139,592 Viewcor Long Beach I LP settlement $132,000 AIS American Internet Services storage computer $120,904 lease CA Redstone Plaza Limited premises lease $94,333 DR Horton contract $87,000 The Seattle Times contract $69,000 Don Anderson deferred $65,361 Brian Connelly settlement $60,000 Larry Gildersleeve deferred $48,143 compensation City of LA Tax & Permit Div. taxes $44,927 Catherine Nicholas deferred $41,161 compensation Paul Desmet deferred $39,655 compensation The Excell Group Inc. contract $32,495 Pat Keulen deferred $31,000 compensation Laura McKittrick deferred $28,217 compensation Nathan Brown deferred $24,500 compensation Rich Botelho deferred $20,000 compensation Sue Mesak deferred $20,000 compensation Melinda Goodbary deferred $15,000 compensation The petition was signed by George A. Ryness III, president. SAN JOSE AIRPORT HOTEL: Files for Chapter 11 Bankruptcy Protection ------------------------------------------------------------------ Cathy Weselby at Silicon Valley/San Jose Business Journal reports that San Jose Airport Hotel LLC has filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court in San Jose. Court documents say that San Jose Airport listed $50 million to $100 million in assets and $10 million and $50 million in debts. San Jose Airport said that its biggest creditor is Holiday Hospitality Franchising Inc., which has a claim of $202,543, Business Journal states. Merle C. Meyers assists San Jose Airport in its restructuring effort. The 512-room, Holiday Inn franchisee San Jose Airport Hotel LLC is located at 1740 N. First Street in San Jose. It is owned by the Mobedshahi Hotel Group. SECURITY BENEFIT: S&P Cuts Counterparty Credit Rating to 'BB' ------------------------------------------------------------- Standard & Poor's Ratings Services said that it lowered its counterparty credit and financial strength ratings on 10 groups of U.S. life insurers and its counterparty credit ratings on seven U.S. life insurance holding companies. Standard & Poor's also said that it placed its ratings on two groups of U.S. life insurers, one of which was also downgraded, on CreditWatch with negative implications. At the same time, Standard & Poor's revised its outlook on an additional U.S. life insurer to negative from stable. In addition, S&P affirmed its ratings on two U.S. life insurers. In response to the extreme pressures in the global economy, S&P recently published criteria that outlined the incremental stress analysis S&P is now applying to U.S. insurers' bond holdings, commercial mortgages, and commercial mortgage-backed securities when S&P assess these companies' capital adequacy. The rating actions primarily reflect the incorporation of these incremental asset stress factors into S&P's capital adequacy analysis as well as the effects of severe equity market declines and volatility on earnings and capital adequacy. S&P expects that the effect of these factors will challenge life companies' competitive strengths and ability to generate profitable business. Over the past few weeks, S&P also took rating actions on several other life companies because of related issues. Within S&P's existing capital-adequacy analysis, S&P previously considered the effects of each firm's statutory impairments on fixed-income assets. The insurers affected by the rating actions had operating earnings -- on both U.S. GAAP and statutory bases -- that fell short of S&P's expectations and showed increased volatility. The depressed equity markets have driven the lower level of operating earnings, resulting in lower asset-based fees, higher costs associated with guaranteed benefits, increased write- offs of deferred acquisition costs (GAAP only), and reduced net investment income. In addition, the rating actions took into account the specific financial flexibility characteristics of each firm and their respective costs of capital given the financial markets. Given the disarray in the credit and capital markets, most insurers' financial flexibility has decreased in the past six months. The ability to access the markets varies by company and from day to day. The market dislocations are hampering two areas that S&P views as particularly important to financial flexibility: liquidity and access to the capital markets. The systemic concern regarding counterparty risk is generally heightened for financial firms. In addition, a lack of liquid markets for many securities has depressed overall access to liquidity for many corporations and financial institutions. The rating actions S&P took have incorporated these concerns. The pressures within the life sector have been building. In October 2008, S&P revised its outlook on the U.S. life insurance industry to negative from stable based on poor financial market conditions and the likelihood of a prolonged period of weaker- than-expected economic conditions. The outlook remains negative. Since October 2008, macroeconomic factors have continued to weaken, as the U.S. is in the midst of perhaps its longest recession in a generation, and S&P's economists believe it is just entering its most difficult phase. S&P's baseline economic forecast is for a deep and long recession, with a sluggish recovery beginning in mid-2009. Standard & Poor's economists are also forecasting negative GDP growth in the first half of 2009 after declines in the second half of 2008, for a total peak-to- trough decline of 3%. The dramatic rise in the expected level of corporate defaults reflects S&P's opinion of the weak credit profiles of many corporations going into this period of economic contraction. Given these difficult economic conditions, S&P believes that life insurers' bond holdings, commercial mortgages, and commercial mortgage-backed securities could experience unprecedented stress in the next 12-18 months. Although the rating actions reflect S&P's opinion of a general decline in the overall creditworthiness of the U.S. life insurance sector, S&P continues to believe the credit fundamentals of the life insurance industry are strong. S&P believes the U.S. life insurance sector remains well capitalized (even considering the incremental asset stress factors), maintains solid businesses, produces strong (albeit lower than historical) earnings, and maintains strong liquidity. The strong liquidity is paramount to S&P's opinion in determining the level of mark-to-market losses in an insurer's asset portfolio. S&P believes that strong liquidity and an insurer's willingness and ability to hold portfolio investments to maturity should provide the necessary bridge for insurers to get beyond the current distressed fixed-income markets. Nonetheless, S&P's capital adequacy analysis now quantitatively considers the projected economic losses on certain assets. Although short-term financial pressures are acute, S&P believes the industry's long-term fundamental strengths remain intact. In S&P's view, the life insurance sector remains well positioned to capture the opportunities in the retirement market. The sector also benefits -- more so than many other financial sectors -- from effective asset/liability management techniques, though current market conditions challenge the rigor of such initiatives. The recent market dislocations, in S&P's view, have challenged all enterprise risk management programs. Given the volatile equity market movements, S&P expects insurers with larger proportions of equity-related risks to improve their existing ERM programs and increase product pricing in new products. Despite the unfavorable market, S&P believes the life insurance industry is generally well positioned to meet its funding requirements. Companies are maintaining excess liquidity in these uncertain times. So far, financial leverage and coverage ratios are within tolerances for the ratings, and most have modest amounts of debt coming due in the second half of 2009 and into 2010. S&P applied the incremental stress analysis to bond holdings, commercial mortgage, and CMBS because these assets generally constitute, in aggregate, approximately 80% of U.S. life insurers' invested assets. Importantly, although S&P is not changing S&P's baseline insurance risk-based capital adequacy model, S&P is applying incremental stresses for these asset classes across all confidence levels during this difficult economic period. S&P is applying the incremental stress factors in a manner that is consistent with the approach taken in S&P's existing risk-based capital adequacy model. The incremental stresses that S&P is introducing seek to determine the amount of capital that an insurer would need to cover the calculated losses in the current economic environment at varying confidence intervals commensurate with ratings categories. S&P will continue to monitor, and possibly revise, the underlying assumptions to maintain their relevance as the events driving the credit cycle evolve. The capital adequacy outcome from the model, as well as from any stress analysis, is only a starting point for S&P's analysis of the overall capital adequacy of insurers. S&P typically apply qualitative and quantitative considerations as warranted to derive a more complete picture of an insurer's capital position. Similarly, S&P generally base its ratings on a broad-based analysis of an insurer's credit quality. Strengths or weaknesses in other key areas -- such as a company's competitive position, management and strategy, investment risk, liquidity risk, operating performance, enterprise risk management, and financial flexibility -- could in some cases more than offset relative strength or weakness in capital adequacy. In addition to the asset stress factors, the rating actions reflect a general overall decline in these major rating factors. S&P views these areas of analysis as being interconnected, and their importance and influence on a rating will differ depending on company-specific circumstances. S&P provides ratings on insurance companies in many parts of the world, and in the process, S&P encounter many different accounting frameworks. S&P's capital model is designed under a globally consistent framework by incorporating regional factors unique to a local market. It is an ongoing objective of Standard & Poor's to normalize the resulting capital measures on a basis that is consistent with U.S. statutory or GAAP/International Financial Reporting Standards accounting. For example, and subject to analytical judgment, S&P generally will not apply incremental stresses to the baseline insurance risk-based capital model when current values are reported on a marked-to-market basis because the figures already reflect the sharp declines in fair value, which in some cases exceed S&P's expectations. S&P could expand its analysis to include additional asset classes as the market conditions continue to evolve, updated information becomes available, and material losses emerge. Standard & Poor's will hold discussions with the companies with ratings on CreditWatch and maintain active surveillance of companies with negative outlooks to determine if any downgrades are warranted. S&P will also continue to evaluate the entire industry to determine which companies are susceptible to rapid and sustained change in stock or bond valuations and the overall impact on any such change on S&P's view of their financial flexibility. Given the current environment, S&P also could develop other incremental stress tests, such as assessing the potential impact of policyholder behavior in guaranteed annuity contracts, which could also affect ratings. In all cases, if actual experience is better than stress-test expectations, subsequent favorable rating actions could result. S&P has focused on U.S. life insurers in these rating actions, as a recent review of all U.S. insurers and the application of the enhanced criteria on the incremental asset stress factors reflects minimal capital adequacy impact to U.S. property/casualty and health insurers. In reviewing the initial results of the incremental stress analysis for these insurance sectors, S&P believes at this time that rating changes are unlikely in the immediate future. Summary Ratings List Americo Life Inc. To From -- ---- Counterparty Credit Rating Local Currency BBB-/Watch Neg/-- BBB- /Stable/-- Americo Financial Life & Annuity Insurance Co. To From -- ---- Counterparty Credit Rating Local Currency A-/Watch Neg/-- A- /Stable/-- Financial Strength Rating Local Currency A-/Watch Neg/-- A- /Stable/-- Conseco Inc. To From -- ---- Counterparty Credit Rating Local Currency CCC/Negative/-- B+/Negative/-- Conseco Inc.'s Core Insurance Operating Companies To From -- ---- Counterparty Credit Rating Local Currency BB-/Negative/-- BB+/Negative/-- Financial Strength Rating Local Currency BB-/Negative/-- BB+/Negative/-- Genworth Financial Inc. To From -- ---- Counterparty Credit Rating Local Currency BBB/Negative/A-2 A- /Negative/A-2 Genworth Financial Inc.'s Core Insurance Operating Companies* To From -- ---- Counterparty Credit Rating Local Currency A/Stable/-- AA- /Negative/-- Financial Strength Rating Local Currency A/Stable/-- AA- /Negative/-- * Some operating companies have 'A-1' short-term ratings. Hartford Financial Services Group Inc. To From -- ---- Counterparty Credit Rating Local Currency BBB+/Watch Neg/A-2 A-/Watch Neg/A-2 Hartford Financial Services Group Inc.'s Core Insurance Operating Companies* To From -- ---- Counterparty Credit Rating Local Currency A+/Watch Neg/-- AA-/Watch Neg/-- Financial Strength Rating Local Currency A+/Watch Neg/-- AA-/Watch Neg/-- * Some operating companies have 'A-1' short-term ratings. Lincoln National Corp. To From -- ---- Counterparty Credit Rating Local Currency A-/Stable/A-2 A+/Negative/A-1 Lincoln Nation Corp.'s Core Insurance Operating Companies To From -- ---- Counterparty Credit Rating Local Currency AA-/Stable/-- AA/Stable/-- Financial Strength Rating Local Currency AA-/Stable/-- AA/Stable/-- MetLife Inc. To From -- ---- Counterparty Credit Rating Local Currency A-/Negative/A-2 A/Stable/A-1 MetLife Inc.'s Core Insurance Operating Companies* To From -- ---- Counterparty Credit Rating Local Currency AA-/Negative/-- AA/Stable/-- Financial Strength Rating Local Currency AA-/Negative/-- AA/Stable/-- * Some operating companies have 'A-1+' short-term ratings. Midland National Life Insurance Co. North American Co. for Life & Health Insurance To From -- ---- Counterparty Credit Rating Local Currency A+/Stable/-- AA- /Negative/-- Financial Strength Rating Local Currency A+/Stable/-- AA- /Negative/-- Pacific LifeCorp To From -- ---- Counterparty Credit Rating Local Currency A-/Negative/-- A/Stable/-- Pacific LifeCorp's Core Insurance Operating Companies To From -- ---- Counterparty Credit Rating Local Currency AA-/Negative/-- AA/Stable/-- Financial Strength Rating Local Currency AA-/Negative/-- AA/Stable/-- Protective Life Corp. To From -- ---- Counterparty Credit Rating Local Currency A-/Stable/-- A/Stable/-- Protective Life Corp.'s Core Insurance Operating Companies To From -- ---- Counterparty Credit Rating Local Currency AA-/Stable/-- AA/Stable/-- Financial Strength Rating Local Currency AA-/Stable/-- AA/Stable/-- Prudential Financial Inc. To From -- ---- Counterparty Credit Rating Local Currency A/Stable/A-1 A/Negative/A-1 Prudential Financial Inc.'s Core Operating Companies* To From -- ---- Counterparty Credit Rating Local Currency AA-/Stable/-- AA/Negative/-- Financial Strength Rating Local Currency AA-/Stable/-- AA/Negative/-- * Some operating companies have 'A-1+' short-term ratings. Security Mutual Life Insurance Co. of NY To From -- ---- Counterparty Credit Rating Local Currency A-/Negative/-- A+/Negative/-- Financial Strength Rating Local Currency A-/Negative/-- A+/Negative/-- Symetra Financial Corp. To From -- ---- Counterparty Credit Rating Local Currency BBB/Negative/-- BBB/Stable/-- Symetra Financial Corp.'s Core Operating Companies* To From -- ---- Counterparty Credit Rating Local Currency A/Negative/-- A/Stable/-- Financial Strength Rating Local Currency A/Negative/-- A/Stable/-- Ratings Affirmed Ohio National Financial Services Inc. Counterparty Credit Rating Local Currency A/Stable/-- Ohio National Financial Services Inc.'s Core Operating Companies Counterparty Credit Rating Local Currency AA/Stable/-- Financial Strength Rating Local Currency AA/Stable/-- OneAmerica Financial Partners Inc. Counterparty Credit Rating Local Currency A-/Stable/-- American United Life Insurance Co. Counterparty Credit Rating Local Currency AA-/Stable/-- Financial Strength Rating Local Currency AA-/Stable/-- State Life Insurance Co. Financial Strength Rating Local Currency AA-/Stable/-- Other Recent Rating Actions Because Of Related Issues AEGON N.V. To From -- ---- Counterparty Credit Rating Local Currency A+/WatchNeg/A-1 A+/Negative/A-1 AEGON N.V.'s Core Insurance Operating Companies* To From -- ---- Counterparty Credit Rating Local Currency AA/WatchNeg/-- AA/Negative/-- Financial Strength Rating Local Currency AA/WatchNeg/-- AA/Negative/-- * Some operating companies have 'A-1+' short-term ratings. AFLAC Inc. To From -- ---- Counterparty Credit Rating Local Currency A-/WatchNeg/-- A/Stable/-- AFLAC Inc.'s Core Insurance Operating Companies To From -- ---- Counterparty Credit Rating Local Currency AA-/WatchNeg/-- AA/Stable/-- Financial Strength Rating Local Currency AA-/WatchNeg/-- AA/Stable/-- AXA Financial Inc To From -- ---- Counterparty Credit Rating Local Currency A+/Negative/-- A+/Stable/-- AXA's Core Insurance Operating Companies* To From -- ---- Counterparty Credit Rating Local Currency AA/Negative/- AA/Stable/-- Financial Strength Rating Local Currency AA/Negative/- AA/Stable/-- * Some operating companies have 'A-1+' short-term ratings. FBL Financial Group Inc. To From -- ---- Counterparty Credit Rating Local Currency BBB-/Negative/-- BBB/WatchNeg/-- FBL Financial Group Inc.'s Core Insurance Operating Companies To From -- ---- Counterparty Credit Rating Local Currency A-/Negative/-- A/WatchNeg/-- Financial Strength Rating Local Currency A-/Negative/-- A/WatchNeg/-- Manulife Financial To From -- ---- Counterparty Credit Rating Local Currency AA-/Stable/-- AA/Negative/-- Manulife Core Insurance Operating Companies To From -- ---- Counterparty Credit Rating Local Currency AA+/Stable/-- AAA/Negative/-- Financial Strength Rating Local Currency AA+/Stable/-- AAA/Negative/-- Phoenix Cos. Inc. To From -- ---- Counterparty Credit Rating Local Currency BB+/WatchNeg/-- BB+/Negative/-- Phoenix Cos. Inc.'s Core Insurance Operating Companies To From -- ---- Counterparty Credit Rating Local Currency BBB+/WatchNeg/-- BBB+/Negative/-- Financial Strength Rating Local Currency BBB+/WatchNeg/-- BBB+/Negative/-- Principal Financial Group Inc. To From -- ---- Counterparty Credit Rating Local Currency A-/Negative/-- A/WatchNeg/-- Principal Life Insurance Co.'s Core Insurance Operating Companies* To From -- ---- Counterparty Credit Rating Local Currency AA-/Negative/-- AA/WatchNeg/-- Financial Strength Rating Local Currency AA-/Negative/-- AA/WatchNeg/-- * Some operating companies have 'A-1+' short-term ratings. Security Benefit Life Insurance Co. To From -- ---- Counterparty Credit Rating Local Currency BB/Negative/-- BBB+/Negative/-- Financial Strength Rating Local Currency BB/Negative/-- BBB+/Negative/-- SunLife Financial To From -- ---- Counterparty Credit Rating Local Currency AA-/Watch Neg/A-1+ AA- /Stable/A-1+ Sun Life's Core Insurance Operating Companies* To From -- ---- Counterparty Credit Rating Local Currency AA+/WatchNeg/-- AA+/Stable/-- Financial Strength Rating Local Currency AA+/WatchNeg/-- AA+/Stable/-- * Some operating companies have 'A-1+' short-term ratings. SECURITY SAVINGS: Nevada Regulators Appoint FDIC as Receiver ------------------------------------------------------------ Security Savings Bank, based in Henderson, Nevada was closed on Fri., Feb. 27, 2009, by the Nevada Financial Institutions Division, which appointed the Federal Deposit Insurance Corporation as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Bank of Nevada, Las Vegas, Nevada, to assume all of the deposits of Security Savings Bank. The two offices of Security Savings Bank will reopen on March 2, 2009, as branches of Bank of Nevada. Depositors of Security Savings Bank will automatically become depositors of Bank of Nevada. Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship to retain their deposit insurance coverage. As of Dec. 31, 2008, Security Savings Bank had total assets of approximately $238.3 million and total deposits of $175.2 million. Bank of Nevada did not pay a premium to acquire the deposits of Security Savings Bank. In addition to acquiring all of the failed banks deposits, including those from deposit brokers, Bank of Nevada agreed to purchase approximately $111.3 million in assets. The FDIC will retain any remaining assets for later disposition. The FDIC estimates that the cost to the Deposit Insurance Fund will be $59.1 million. The Bank of Nevada's acquisition of all the deposits of Security Saving Bank was the "least costly" resolution for the FDIC's Deposit Insurance Fund compared to alternatives. Security Savings Bank is the sixteenth bank to fail in the nation this year. The last bank to fail in Nevada was Washington Mutual Bank, Henderson, on Sept. 25, 2008. SEMGROUP LP: Catsimatidis Has No Funds for Asphalt Bid; No Buyer ---------------------------------------------------------------- SemGroup L.P. received interest for its liquid asphalt products business, SemMaterials L.P., however, none of the prospective buyers could arrange financing before the auction on February 23, Bloomberg's Bill Rochelle reported. According to the report, a company lawyer said papers would be filed in bankruptcy court outlining plans for the asphalt business. Bloomberg reported that lawyers of SemGroup and New York investor John A. Catsimatidis confirmed that Mr. Catsimatidis submitted a bid for the asphalt products business, but failed to arrange financing on time. Mr. Catsimatidis owns five of nine seats on SemGroup's management committee, but has feuded with SemGroup's managers and lawyers over his effort to take charge of the Company's restructuring. SemMaterials, L.P. sought approval from the U.S. Bankruptcy Court for the District of Delaware of (i) a February 23 auction and sale of all or substantially all of its assets, or in the alternative, (ii) a winding-down of SemMaterials and the rejection of a terminalling agreement with non-debtor affiliate SemGroup Energy Partners, L.P. On January 14, 2008, SemMaterials entered into a purchase and sale agreement with SemGroup Energy Partners, L.P., pursuant to which SemMaterials sold domestically-owned liquid asphalt cement assets, having a $145,000,000 net book value. Those assets were sold for $378,800,000, and the sale closed on February 20, 2008. SemMaterials and SGLP also entered into a terminalling and storage agreement under which SGLP provides terminalling and storage services to SemMaterials for $5,000,000 monthly. According to Mark D. Collins, Esq., at Richards, Layton & Finger, P.A., in Wilmington, Delaware, since the Debtors' bankruptcy filing, SemMaterials' business has been curtailed. Working capital requirements to fund inventory purchases have been substantial, he says, and fixed costs have become burdensome, including the $5,000,000 monthly payments to SGLP under the Terminalling Agreement. The Debtors believe that continuing to own SemMaterials' Assets is not in the best interests of the Debtors' estates. In their request to sell or liquidate SemMaterials, the Debtors said they engaged in discussions with SGLP to amend the Terminalling Agreement and jointly market the asphalt assets. However, no agreement with SGLP has been reached. In addition, despite their efforts to market SemMaterials, the Debtors have not reached a contract with any buyer. The Debtors have noted that SemMaterials' carrying costs and cash burn total $15,000,000 per month. Hence, the Debtors have determined that they need to sell SemMaterials to avoid further cash drain. Blackstone Advisory Services, L.P., as the Debtors' financial advisors, contacted more than 130 potential buyers and parties to promote interest in the SemMaterials sale process. On October 6, 2008, Blackstone received six qualified bids, which were allowed to conduct comprehensive due diligence. Following management presentations, five parties withdrew in the marking process, due to high fixed costs under the Terminalling Agreement, working capital needs and seasonal cash flow, and the failure to secure products ahead for the 2009 season. The remaining potential buyer remains in the process; however, it remains unclear whether that party can obtain the financing required to complete the sale, Mr. Collins stated in SemGroup's motion to auction off or liquidate SemMaterials. SemGroup had also said that if the auction is unsuccessful, it would seek to reject the Terminalling Agreement on February 26, 2009. Rejecting the Agreement allows the Debtors to avoid approximately $50,000,000 of future payments for 2009, Mr. Collins explained. Winding-down SemMaterials minimizes expenses and maximizes the Debtors' recovery, and enables the Debtors to receive $100,000,000 for its current inventory and other liquid assets, he stated. About SemGroup LP SemGroup L.P. -- http://www.semgrouplp.com/-- is a midstream service company providing the energy industry means to move products from the wellhead to the wholesale marketplace. SemGroup provides diversified services for end users and consumers of crude oil, natural gas, natural gas liquids, refined products and asphalt. Services include purchasing, selling, processing, transporting, terminaling and storing energy. SemGroup serves customers in the United States, Canada, Mexico, Wales, Switzerland and Vietnam. SemGroup L.P. and its debtor-affiliates filed for Chapter 11 protection on July 22, 2008 (Bankr. D. Del. Lead Case No. 08- 11525). These represent the Debtors' restructuring efforts: John H. Knight, Esq., L. Katherine Good, Esq. and Mark D. Collins, Esq., at Richards Layton & Finger; Harvey R. Miller, Esq., Michael P. Kessler, Esq., and Sherri L. Toub, Esq., at Weil, Gotshal & Manges LLP; and Martin A. Sosland, Esq., and Sylvia A. Mayer, Esq., at Weil Gotshal & Manges LLP. Kurtzman Carson Consultants L.L.C. is the Debtors' claims agent. The Debtors' financial advisors are The Blackstone Group L.P. and A.P. Services LLC. Margot B. Schonholtz, Esq., and Scott D. Talmadge, Esq., at Kaye Scholer LLP; and Laurie Selber Silverstein, Esq., at Potter Anderson & Corroon LLP, represent the Debtors' prepetition lenders. SemGroup L.P.'s affiliates, SemCAMS ULC and SemCanada Crude Company, sought protection under the Companies' Creditors Arrangement Act (Canada) on July 22, 2008. Ernst & Young, Inc., is the appointed monitor of SemCanada Crude Company and its affiliates' reorganization proceedings before the Canadian Companies' Creditors Arrangement Act. The CCAA stay expires on Nov. 21, 2008. SemGroup L.P.'s consolidated, unaudited financial conditions as of June 30, 2007, showed $5,429,038,000 in total assets and $5,033,214,000 in total debts. In their petition, they showed more than $1,000,000,000 in estimated total assets and more than $1,000,000,000 in total debts. Bankruptcy Creditors' Service, Inc., publishes SemGroup Bankruptcy News. The newsletter tracks the chapter 11 proceedings undertaken by SemGroup L.P. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-700) SERVICE MASTER: Bank Loan Sells at 36% Off in Secondary Market -------------------------------------------------------------- Participations in a syndicated loan under which Service Master is a borrower traded in the secondary market at 63.41 cents-on-the- dollar during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. This represents an increase of 1.78 percentage points from the previous week, the Journal relates. The loan matures July 24, 2014. Service Master pays 300 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B1 rating and Standard & Poor's B+ rating. Based in Memphis, Tennessee, ServiceMaster provides outsourcing services to residential and commercial customers, primarily in the United States. Its services include lawn care, landscape maintenance, termite and pest control, home warranty, disaster response and reconstruction, cleaning and disaster restoration, house cleaning, furniture repair, and home inspection. * * * As reported by the Troubled Company Reporter on February 10, 2009, Moody's Investors Service affirmed the B2 Corporate Family Rating of The ServiceMaster Company and changed the rating outlook to negative from stable. "The negative outlook considers the potential for the weakening economy in the US to depress demand for the company's consumer service offerings during 2009, particularly in the more discretionary lawn care and home warranty business lines," stated Lenny Ajzenman, Vice President and Senior Credit Officer. SIMMONS BEDDING: Moody's Puts 'Ca' Probability of Default Rating ---------------------------------------------------------------- Moody's Investors Service assigned a limited default rating to Simmons following the expiration of the 30 day grace period of a missed interest payment on its $200 million subordinated notes. The limited default rating is assigned to Simmons' Ca probability of default rating. All other ratings are affirmed. The outlook is developing. On January 15, 2009, Simmons missed an interest payment on its $200 million senior subordinated notes and did not make the interest payment within the 30 day grace period, which expired on February 16, 2009. However, consistent with the senior secured lenders, the company received a forbearance agreement on the senior subordinated notes through March 31, 2009; a forbearance agreement for the secured lenders was required because the company was in violation of financial covenants. "Despite the forbearance agreements, Moody's treats a missed interest payment on a debt security as a limited default" said Kevin Cassidy, Senior Credit Officer at Moody's Investors Service. The developing outlook reflects the uncertainty about the company's future operating plans and whether the company will file for bankruptcy protection or possibly restructure its balance sheet outside of bankruptcy. Moody's will re-evaluate Simmons' rating when the company completes its discussions with both the senior and unsecured lenders. Ratings downgraded: -- Probability of default rating to Ca/LD from Ca; Ratings affirmed/assessment revised: * Corporate family rating at Caa3; * $200 million senior subordinated notes due 2014 at Caa3 (LGD-3, 33% from LGD-3, 32%); * $75 million senior secured revolver due 2011 at B2 (LGD-1, 9% from LGD-1, 8% ); * $492 million senior secured term due 2011 at B2 (LGD-1, 9% from LGD-1, 8% ); * $269 million senior discount notes due 2014 at Ca (LGD-4, 55%) -- no change in LGD assessment * $300 million Super Holdco Toggle loan at C (LGD-5, 78%) -- no change in LGD assessment The last rating action was on December 9, 2008, where Moody's lowered all ratings two notches and kept the rating outlook negative as Moody's expected the company to either restructure its balance sheet or possibly file for bankruptcy protection. Simmons Bedding Company, a wholly-owned subsidiary of Simmons Company, is headquartered in Atlanta, Georgia. Net sales for the twelve months ended September 2008 approximated $1.1 billion. SINGLE TOUCH: December 31 Balance Sheet Upside-Down by $5 Million ----------------------------------------------------------------- Single Touch Systems, Inc.'s balance sheet at Dec. 31, 2008, showed total assets of $13,301,049 and total liabilities of $18,238,413, resulting in a stockholders' deficit of $4,937,364. For the three months ended Dec. 31, 2008, the Company posted a net loss of $4,170,750 compared with a net loss of $2,333,732. During the three-month period ended Dec. 31, 2008 the Company's cash position increased by $120,747. Cash used in operating activities totaled $854,947; cash used in investing activities totaled $248,276, for purchase of property and equipment of $10,175 and capitalized software development costs of $238,101; and, cash provided by financing activities primarily through the issuance of debt to others was $1,223,970. As of Dec. 31, 2008, the Company's available cash amounted to $295,808, which is insufficient to meet all of its current financial obligations and continue funding its operations. The Company's current cash requirement to maintain operations at existing operational levels is approximately $400,000 per month. Management continues to address its cash requirements through developing revenue new ADC products, expanding its customer base and through the issuance of debt and equity instruments. If additional funds are not received or revenues do not increase substantially it is unlikely that the Company will be able to continue at its current level of operations. Difficulties in obtaining new financing in the current credit and capital markets has impacted the Company's funding efforts and has limited additional resources of funding from its president, Anthony Macaluso, who has historically covered short term cash requirements to maintain operations. Going Concern Doubt The Company's operations is dependent on revenue from its licensing of its technologies and related services advancements made by its officers, and the raising capital through the sale of its equity instruments or issuance of debt. Management believes that these sources of funds will allow the Company to continue as a going concern through 2008. However, no assurances can be made that current or anticipated future sources of funds will enable the Company to finance future periods' operations. In light of these circumstances, the Company said that substantial doubt exists about its ability to continue as a going concern. A full-test copy of the Form 10Q is available at: http://ResearchArchives.com/t/s?39de About Single Touch Systems Inc. Headquartered in Encinitas, California, Single Touch Systems, Inc. (OTCBB:SITO) engages in the development, publishing, and distribution of wireless applications in the United States. The company's principal product include Abbreviated Dial Code, an access distribution channel that supports and facilitates the download of content in various forms, such as the delivery of an application, a connection to a customer service agent, and a connection to an IVR. The ADC programs also could be used to initiate a WAP, MMS, or SMS session; digitally populate a form; and provide lead generation services to end user mobile devices. It also offers Mobile Machine, which enables consumers to download content, including images, ring tones, videos, and applications from the Internet to a mobile device by a drag and drop interface; and Mobile Idol that creates customized ring tones. SIRIUS XM RADIO: Discloses Exchange of $172.5MM of Existing Notes ----------------------------------------------------------------- On February 13, 2009, Sirius XM Radio Inc. and its wholly-owned subsidiaries, XM Satellite Radio Holdings Inc., XM 1500 Eckington LLC and XM Investment LLC entered into a note purchase agreement with certain purchasers, whereby the Purchasers exchanged $172,485,000 aggregate principal amount of outstanding 10% Convertible Senior Notes of XM Holdings for a like principal amount XM Holdings' Senior PIK Secured Notes due 2011 in a private placement transaction pursuant to an exemption from the registration requirements of the Securities Act of 1933, as amended. The New Notes are fully and unconditionally guaranteed by XM 1500 Eckington LLC and XM Investment LLC. The New Notes are secured by a first-priority lien on substantially all of the personal and real estate property of the Subsidiary Guarantors. XM Holdings may, at its option, redeem some or all of the New Notes at any time at 100% of the principal amount prepaid, together with accrued and unpaid interest, if any. The Company has agreed to pay to the Purchasers a fee equal to, at each Purchaser's election, either (i) 833 shares of its common stock for every $1,000 principal amount of Old Notes exchanged or (ii) an amount in cash equal to $50 for every $1,000 principal amount of Old Notes exchanged. The total number of Structuring Fee Shares delivered was 59,718,519, and the aggregate cash delivered was approximately $5.1 million. The Structuring Fee Shares were issued pursuant to an exemption from the registration requirements of the Securities Act. Pursuant to the Note Purchase Agreement, the Company has filed a prospectus supplement to its existing shelf registration statement naming each of the Purchasers as selling stockholders for the Structuring Fee Shares issued and to be issued to the Purchasers. The Company also agreed to keep that prospectus supplement continuously usable until the earlier of (i) the six-month anniversary of the issuance of the New Notes, (ii) when all such Structuring Fee Shares are eligible to be sold immediately without volume, manner of sale, filing or other restrictions by its non- affiliates pursuant to Rule 144 of the Securities Act or (iii) when all the Structuring Fee Shares covered by the prospectus supplement have been sold pursuant to a registration statement. The terms of the New Notes are governed by an indenture, dated as of February 13, 2009, among the Company, XM Holdings, as issuer, the Subsidiary Guarantors and U.S. Bank National Association, as trustee. The New Notes are fully and unconditionally guaranteed by the Subsidiary Guarantors. The aggregate principal amount outstanding of the New Notes will be paid on the final maturity date of June 1, 2011. The Company will pay interest on the principal amount of the New Note at a rate of 10.0% per annum paid in cash from December 1, 2008, to December 1, 2009; at a rate of 10.0% per annum paid in cash and 2.0% per annum paid in kind from December 1, 2009, to December 1, 2010; and at a rate of 10.0% per annum paid in cash and 4.0% per annum paid in kind from December 1, 2010, to the final maturity date. Interest will be paid semiannually in arrears on June 1 and December 1 of each year. The New Notes rank equally in right of payment with XM Holdings' existing and future senior indebtedness, and are secured pursuant to a security agreement between the Subsidiary Guarantors and U.S. Bank National Association, as collateral agent. Pursuant to the Security Agreement, the collateral underlying the security interest in the New Notes consists of a perfected first-priority lien on substantially all of the real and personal property of the Subsidiary Guarantors, which includes certain real estate holdings in Washington D.C., including the XM Holdings corporate headquarters. The Company has engaged advisors in connection with a financing transaction relating to the XM Holdings corporate headquarters. Pursuant to the indenture, XM Holdings is required to apply the net proceeds of a sale lease-back or other financing transaction of the headquarters to redeem the Notes. Provided that such financing transaction raises proceeds of at least $50 million and XM Holdings uses such proceeds to redeem the Notes, the lien on all such real and personal would be released. The New Notes may be redeemed at the option of XM Holdings at any time, in whole or in part, at a price equal to 100% of the principal amount thereof plus accrued and unpaid interest. In addition, upon the occurrence of a fundamental change, each holder will have the right, subject to the terms and conditions of the indenture, to put its New Notes to XM Holdings at a price equal to 100% of the principal amount thereof plus accrued and unpaid interest. The indenture also contains customary covenants, including a covenant limiting mergers and consolidations of XM Holdings and the Subsidiary Guarantors. The New Notes are also subject to customary events of default, including a cross-payment default and cross-acceleration provision. Pursuant to the Note Purchase Agreement, the Company also entered into a registration rights agreement, dated as of February 13, 2009, between the Company, XM Holdings, the Subsidiary Guarantors and the Purchasers, pursuant to which the Company agreed to use reasonable best efforts to file a shelf registration statement no later than March 17, 2009, to permit resales of the New Notes, to use reasonable best efforts to cause that registration statement to be declared effective as soon as practicable thereafter and to use reasonable best efforts to keep the registration statement effective during the period specified in the Registration Rights Agreement. In lieu of filing or causing a shelf registration statement to become effective, the Company may elect to use reasonable best efforts to file an exchange offer registration statement for an offer to exchange the New Notes for exchange notes, to commence an exchange offer promptly after the exchange offer registration statement is declared effective and to complete the exchange offer within 60 days after it is declared effective. If the shelf registration statement is not declared effective within 180 days after March 17, 2009, or is declared effective but thereafter ceases to be effective or usable, or if the exchange offer is not consummated on or prior to such date, additional interest will accrue on the New Notes at a rate of 0.25% per annum. About Sirius XM Radio Headquartered in New York, Sirius XM Radio Inc. (SIRI) -- http://www.sirius.com/-- formerly Sirius Satellite Radio Inc., is a satellite radio provider. The company offers over 130 channels to its subscribers, 69 channels of 100% commercial-free music and 65 channels of sports, news, talk, entertainment, traffic, weather, and data content. Its primary source of revenue is subscription fees, with most of its customers subscribing to SIRIUS on either an annual, semi-annual, quarterly or monthly basis. The company derives revenue from activation fees, the sale of advertising on its non-music channels, and the direct sale of SIRIUS radios and accessories. Various brands of SIRIUS radios are Best Buy, Circuit City, Costco, Crutchfield, Sam's Club, Target and Wal-Mart. * * * As reported by the Troubled Company Reporter on Jan. 20, 2009, Standard & Poor's Ratings Services said it lowered its corporate credit rating on Sirius XM Radio Inc. to 'CCC' from 'CCC+'. S&P also lowered the issue-level ratings on the debt of Sirius XM Radio Inc. and of Sirius' unrestricted subsidiaries, XM Satellite Radio Holdings Inc. and XM Satellite Radio Inc., which remain on CreditWatch, though the implications are revised to negative from developing. S&P could affirm or lower the issue-level ratings pending S&P's review of additional information and follow-up discussions with management. The outlook is negative. New York City-based Sirius XM had total debt outstanding of $3.37 billion as of Sept. 30, 2008. SMART-TEK SOLUTIONS: Dec. 31 Balance Sheet Upside Down $729,468 --------------------------------------------------------------- Smart-tek Solutions Inc. posted a net loss of $40,611 for the six months ended December 31, 2008, on total revenues of $1,744,551, compared with a net loss of $2,725,734 for the same period in 2007, on total revenues of $1,706,899. Perry Law, president, chief executive officer, chief financial officer and sole director, disclosed in a regulatory filing dated February 23, 2009, that the Company had a working capital deficiency of $1,188,947 and a shareholders' deficiency of $729,468. "These matters raise substantial doubt about its ability to continue as a going concern. Management believes that actions are presently being taken to revise the Company's operating results. Management believes that the Company will have adequate cash to fund anticipated needs through December 31, 2009 and beyond primarily as a result of our contract backlog." "The Company does not have any significant available credit, bank financing or other external sources of liquidity. Due to historical operating losses, the Company's operations have not been a source of liquidity and the Company has satisfied its cash requirements through shareholder loans and deferral of salary payments to its officers. In order to obtain necessary capital, the Company may need to sell additional shares of its common stock or borrow funds from private lenders. There is no assurance that the Company will be able to secure additional financing or that it can be secured at rates acceptable to the Company. In addition, should the Company be required to either issue stock for services or to secure equity funding, due to the lack of liquidity in the market for the Company's stock such financing would result in significant dilution to its existing shareholders." About Smart-tek Solutions Based in Reno, Nev., Smart-tek Solutions, Inc. (OTC BB: STTK) -- http://www.smart-teksolutions.com/-- through its subsidiary, Smart-tek Communications Inc., engages in the design, sale, installation, and service of electronic hardware and software products in Canada. John Kinross-Kennedy, in Irvine, Calif., expressed substantial doubt about Smart-tek Solutions' ability to continue as a going concern after auditing the company's consolidated financial statements for the year ended June 30, 2007. The auditor pointed to the Company's net loss, negative cash flow from operations during the year ended June 30, 2007, and working capital deficiency and shareholders' deficiency at June 30, 2007. SPANSION INC: Files for Chapter 11; Aims to Emerge Quickly ---------------------------------------------------------- Spansion Inc. (Nasdaq: SPSN), the world's largest pure-play provider of Flash memory solutions, filed on March 1, 2009, a voluntary petition for reorganization under chapter 11 of the U.S. Bankruptcy Code as part of its strategy to strengthen its financial position and focus its business for long-term success. The company's strategic plan is designed to restructure its burdensome debt obligations and intensify its focus on market segments with greater profit potential. Each of Spansion's domestic subsidiaries also simultaneously filed chapter 11 petitions. "Given our focus on Spansion's future, management and the Board have concluded that chapter 11 provides the most effective means for Spansion to preserve its business, meet its post-petition obligations and maintain customer confidence and continuity while we complete this restructuring," said President and CEO John Kispert. "At the same time we will continue to explore opportunities for a strategic transaction to ensure that we are doing all we can to maximize value for our stakeholders." The decision to seek chapter 11 protection was made in consultation with an ad hoc consortium of holders of Spansion's $625 million Senior Secured Floating Rate Notes due 2013. Spansion continues to be actively engaged in constructive discussions with this ad hoc consortium for the development of a plan of reorganization that would permit Spansion to emerge quickly from chapter 11 in a stronger financial and competitive position and for the continued exploration of multiple proposals from multiple parties seeking a strategic transaction. The company believes that its current and anticipated cash resources will be sufficient to pay its expenses and maintain its business operations while it explores and implements options to address its long-term cash needs. Among other things, the company is in discussion with the ad hoc consortium about providing a debtor-in-possession (DIP) credit facility, while also simultaneously pursuing other options intended to provide the company with additional liquidity for its long-term cash needs. Spansion emphasized that it intends to maintain customer service throughout the reorganization. "We will be intensely focused on continuing to provide our customers with superior engineering and world-class customer support," Mr. Kispert said. On February 9, 2009, Spansion's Japanese subsidiary, Spansion Japan Ltd., voluntarily entered into a proceeding under the Corporate Reorganization Law (Kaisha Kosei Ho) of Japan to obtain protection from its creditors as part of the company's restructuring efforts. None of Spansion's subsidiaries in countries other than the United States and Japan are included in the U.S. or Japan filings. About Spansion Spansion Inc. (NASDAQ: SPSN) -- http://www.spansion.com-- is a Flash memory solutions provider, dedicated to enabling, storing and protecting digital content in wireless, automotive, networking and consumer electronics applications. Spansion, previously a joint venture of AMD and Fujitsu, is the largest company in the world dedicated exclusively to designing, developing, manufacturing, marketing, selling and licensing Flash memory solutions. * * * Spansion let a 30-day grace period elapse without making the interest payment it missed in January on the $250 million 11.25% senior notes of 2016. The Troubled Company Reporter said February 20, 2009, that Spansion Japan Limited, an indirect subsidiary of Spansion Inc., entered into a proceeding under the Corporate Reorganization Law (Kaisha Kosei Ho) of Japan to obtain protection from Spansion Japan's creditors while it continues restructuring efforts. The Spansion Japan Proceeding constitutes an event of default causing automatic acceleration of the outstanding obligations without further action under various debt instruments of Spansion LLC and Spansion Japan. Spansion is in active discussions with an ad hoc committee representing holders of its US$625 million Senior Secured Floating Rate Notes due 2013 about restructuring the company's balance sheet as well as potential strategic transactions. The TCR reported on Feb. 24, 2009, that Spansion Inc. is reducing its global work force by roughly 3,000 employees, or 35%. The majority of the positions affected are at Spansion's global manufacturing sites, as the company resizes the organization due to current market conditions. This action is taken in an effort to further reduce costs as Spansion continues its restructuring efforts and explores various strategic alternatives. As reported by the TCR on Jan. 19, 2009, Fitch Ratings downgraded these ratings for Spansion Inc.: -- Issuer Default Rating to 'C' from 'CCC'; -- US$175 million senior secured revolving credit facility (RCF) due 2010 to 'CC/RR3' from 'CCC+/RR3'; -- US$625 million senior secured floating rating notes due 2013 to 'CC/RR3' from 'CCC+/RR3'; -- US$225 million of 11.25% senior unsecured notes due 2016 to 'C/RR6' from 'CC/RR6'; -- US$207 million of 2.25% convertible senior subordinated debentures due 2016 to 'C/RR6' from 'CC/RR6'. Moody's Investors Service downgraded Spansion's corporate family rating and probability of default rating to Ca from Caa2, senior secured floating rate notes to Caa2 from B3 and senior unsecured notes to Ca from Caa3. Standard & Poor's Ratings Services lowered its corporate credit rating on Spansion Inc. to 'D' from 'CCC', and the issue-level rating on Spansion LLC's 11.25% senior unsecured notes due 2016 to 'D' from 'CC'. SPANSION INC: Case Summary & 65 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Spansion Inc., Spansion Inc. 915 DeGuigne Drive Sunnyvale, CA 94085 Bankruptcy Case No.: 09-10690 Debtor-affiliates filing subject to Chapter 11 petitions: Entity Case No. ------ -------- Spansion Technology LLC 09-10691 Spansion LLC 09-10692 Spansion International, Inc. 09-10693 Cerium Laboratories LLC 09-10694 Type of Business: The Debtors (NASDAQ: SPSN) design, develop, manufacture, market and sell flash memory solutions for wireless, automotive, networking and consumer electronics applications. According to the Troubled Company Reporter Jan. 19, 2009, Standard & Poor's Ratings Services lowered its corporate credit rating on Spansion Inc. to 'D' from 'CCC', and the issue- level rating on Spansion LLC's 11.25% senior unsecured notes due 2016 to 'D' from 'CC'. In addition, S&P lowered the issue-level rating on Spansion LLC's floating-rate senior secured notes to 'C' from 'CCC', and the issue-level rating on the company's 2.25% exchangeable senior subordinated debentures to 'C' from 'CC'. Recovery ratings on the company's debt issues remain unchanged. The action reflects the announcement that the company will not make the Jan. 15, 2009 scheduled interest payment on its 11.25% senior notes, which mature on Jan. 15, 2016. See: http://www.spansion.com/ Chapter 11 Petition Date: March 1, 2009 Court: Northern District of California (Oakland) Debtors' Cousnel: Michael S. Lurey, Esq. Gregory O. Lunt, Esq. Kimberly A. Posin, Esq. Latham & Watkins LLP 355 South Grand Avenue Los Angeles, CA 90071-1560 Tel: (213) 485-1234 Fax: (213) 891-8763 Delaware Counsel: Michael R. Lastowski, Esq. mlastowski@duanemorris.com Duane Morris LLP 1100 North Market Street, Suite 1200 Wilmington, DE 19801-1246 Tel: (302) 657-4900 Fax: (302) 657-4901 Claims Agent: Epiq Bankruptcy Solutions LLC The Debtors' financial conditions on a consolidated basis as of the end of the third quarter of 2008: Total Assets: $3.840,000,000 Total Debts: $2,398,000,000 The Debtor's Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ U.S. Bank National Association Senior Notes $457,000,000 Corporate Trust Services due 2016 Attn: James E. Murphy 100 Wall Street, Suite 1600 New York, NY 10005 Tel: 1-212-361-6174 Fax: 1-212-514-6841 Wilmington Trust Exc Senior Sub. Attn: James J. McGinley Debentures due 520 Madison Ave., 33rd Floor 2016 Tel: 1.212.415.0522 Sub Fax: 1.212.415.0513 New York, NY 10022 Fidelity Management & Senior Notes $69,001,000 Research Co due 2016 82 Devonshire Street Exc Senior Boston, MA 02109 Sub Debentures Tel: 1-617-563-7000 due 2016 Fax: 1-617-476-4001 ChipMOS Technologies Vendor $57,724,440 (Bermuda) LTD. 11F No 3 Lane 91 Dongmei, Hsinchu 300 Taiwan Tel: 1-8863-571-6088 Fax: 1.8863-571-6070 TEL U.S. Holdings and TEA Trade debt- $49,449,727 Headquarters2400 Grove Blvd. supplier Austin, TX 78741 Vendor Tel: 1.512.424.1000 Fax: 1.512.424.1001 Tokyo Electron Europe HeadquartersPioneer, Crawley Business Quarter, Fleming Way, Crawley West Sussex RHIO 9QL England, U.K. Tel: +44(0) 1293-655800 Fax: +44(0) 1293-655888 AIG Global Investment Group, Senior Notes $33,825,000 Inc. due 2016 70 Pine Street Exc Senior New York, NY 10270 Sub Debentures Tel: 1-212-770-7000 due 2016 Fax: 1-212-458-2200 Murata Electronics North Trade debt- $19,400,000 America, Inc. supplier Corporate Headquarters 2200 Lake Park Drive Smyrna, GA 30080-7604 Tel: 1-770-436-1300 Fax: 1-770-436-3030 MFS Investment Management Senior Notes $17,300,000 500 Boylston Street due 2016 Boston, MA 02116-3741 Tel: 1-877-969-6077 Fax: 1-617-350-2189 Brigade Capital Management, Senior Notes $14,650,000 LLC due 2016 717 5tl1 Ave, 12th Floor New York, NY 10022-8112 Tel: 1-212-754-6401 Tel: 1-516-521-0397 TSMC North America Inc. Vendor $13,290,216 2585 Jet Avenue San Jose, CA 95134 Tel: 1-408-382-8000 Fax: 1-408-382-8008 Goldman Sachs Asset Senior Notes $12,625,000 Management LP due 2016 85 Broad Street New York, NY 10004 Tel: 1-212-902-1000 Fax: 1-212-357-5281 Whitebox Advisors, LLC Exc Senior $11,363,000 3033 Excelsior Blvd. Sub Debentures Minneapolis, MN 55416 due 2016 Unliquidated Tel: 1-612-253-6030 Fax: 1-612-253-6100 KLA-Tencor California Vendor $10,624,245 SensArray Division 5451 Patrick Henry Dr. Santa Clara, CA 95054 Tel: 1-408-986-5600 Fax: 1-408-986-5601 KLA-Tencor Texas - Photomask Business Unit 7500 Rialto Blvd., BId One Suite 100 Austin, TX 78735 Tel: 1-512-462-6200 Fax: 1-512-462-6260 Verigy ltd. Trade debt- $10,200,000 No.1 Yishun Avenue 7 supplier Singapore 768923 Disputed Tel: (+65) 6755-2033 Fax: (+65) 6556-295 Fax: +(65) 6270-8372 Euroc1ear Bank Senior Notes $10,100,000 1 Boulevard du Roi due 2016 Albert II Contingent B-1210 Brussels, Belgium Tel: +32 (0)2 326-1211 Fax: +32 (0)2 326-1287 T Rowe Price Associates, Inc. Senior Notes $9,777,000 100 East Pratt Street due 2016 Baltimore, Maryland 21202 Tel: 1-410-345-2000 Fax: 1-410-345-6575 Fax: 1-410-345-2394 Aehr Test Systems (USA Vendor $9,684,134 Corporate Headquarters) 400 Kato Terrace Disputed Fremont, CA 94539 Tel: 1-410-345-3603 Tel: 1-510-623-9400 Fax: 1.510.623.9450 JPMorgan Securities, Inc. Exc Senior $9,079,000 270 Park Avenue, Sub Debentures New York, NY 10017 due 2016 Tel: 1-212-270-6000 Fax: 1-212-270-1648 Loews Corp. Senior Notes $8,500,000 667 Madison Avenue due 2016 New York, NY 10065-8087 Tel: 1-212-521-2000 Fax: 1-212-521-2525 Form Factor, Inc. Vendor $8,135,822 Attn: Accounts Receivable Dept 33758 San Francisco, CA 94139 Tel: 1-925-290-4055 Fax: 1-925-294-8147 FormFactor, Inc. 7545 Longard Road Livermore, CA 94551 Tel: 1-925-290-4000 Fax: 1-925-290-4010 Saifun Semiconductors Ltd. Vendor $7,294,734 2350 Mission College Blvd. #1070 Disputed Santa Clara, CA 95094 Tel: 1.408.982.5888 Saifun Semiconductors Ltd. 6 Arie Regev Street Sappir Industrial Park Netanya, 42504 Israel Tel: +972(0) 9-892-8444 Fax: +972(0) 9-892-8445 Applied Materials, Inc. Vendor $7,089,502 3050 Bowers Avenue Santa Clara, CA 95054 Disputed Tel: 1-408-727-5555 Fax: 1-408-748-9943 Applied Materials, Inc. 974 East Arques Ave. Sunnyvale, CA 94085 Tel: 1-408-727-5555 Tel: 1-425-557-1000 Fax: 1-425-557-1055 Applied Materials, Inc. Dept LA 21161 Pasadena, CA 91185-1161 Applied Materials, Inc. P.O. Box 7777 W0850 Philadelphia, PA 19175 UBS Securities, LLC Senior Notes $7,000,000 299 Park Avenue due 2016 New York, NY 10171 Tel: 1-212-821-4000 Fax: 1-212-821-4490 Northwestern Investment Exc Senior $6,000,000 Management Co. Sub Debentures 720 East Wisconsin Avenue due 2016 Milwaukee WI 53202 Tel: 1-414-271-4444 Fax: 1-414-665-7124 Winbond Electronics Corp Vendor $5,973,839 No.8, Keya Rd. I, Central Taiwan Science Park Taichung County, 428, Taiwan R.O.C. Tel: 886-4-25218168 Fax: 886-2-87513578 Winbond Electronics Corporation America 2727 N. First Street San Jose, CA 95134 Tel: 1-408-943-6666 Fax: 1-408-544-1789 CS Securities (Europe) Senior Notes $5,500,000 II Madison Avenue due 2016 New York, NY 10010-3629 Tel: 1.212.325.2000 Fax: 1.212.325.6665 Toppan Photomasks, Inc. Trade debt- $7,953,154 131 Old Settlers Boulevard supplier Vendor Round Rock, TX 78664 Tel: 1-512-310-6500 Fax: 1-512-310-6544 Highland Capital Management Senior Notes $5,000,000 LP due 2016 9 West 57th St., 38th Floor New York, NY 10019 Tel: 1-212-792-6900 Fax: 1-212-792-6920 Kandenko Co., Ltd. Trade debt- $4,600,000 4-8-33, Shibaura, Minato-ku supplier TOKYO, Japan Disputed Tel: 03-4431-2111 Tokyo Electron Device Limited Trade debt- $4,400,000 Yokohama East Square, 1-4, supplier Kinko-Cho, Kanagawa-Ku Yokohama City, Kanagawa 221-0056 Japan Tel: 81-454747000 Tel: 81-454434400 Fax: 81-454434050 Tokyo Electron Device Ltd. I, Higashikata-Machi, Tsuzuki- Ku Yokohama, 142240045 Japan Tel: 81-45474-7035 Fax: 81-45474-5617 Pacific Investment Management Exc Senior $3,750,000 Co LLC (PIMCO) Sub Debentures 1345 Avenue of the Americas due 2016 New York, NY 10105-4800 Tel: 1-212-739-3000 Fax: 1-212-739-3926 Deutsche Bank AG Senior Notes $3,683,000 60 Wall Street due 2016 New York, NY Contingent Tel: 1-212-250-2500 Fax: 1-212-250-4429 AMD Vendor $3,442,970 One AMD Place P.O. Box 3453 Disputed Sunnyvale, CA 94088-3453 Tel: 1-408-749-4000 Fax: 1-408-749-4291 AMD Austin, Lone Star Advanced Micro Devices 7171 Southwest Pkwy Austin, TX 78735 Tel: 1-512-602-1000 Fax: 1-512-602-4100 AMDlnc. Vendor $817,722 Attn: M.A. Oakes 5204 East Ben White Blvd. Austin, Texas 78741 Unliquidated Tel: 1-512-602-2045 AMDGmbH Karl-Hammerschmidt Strasse 34 Dornach B. 85609 Munchen, Germany Tel: 49 (0) 89-450530 Fax: 49 (0) 89-406490 Micron Technology, Inc. Vendor $3,419,205 8000 S. Federal Way P.O. Box 6 Disputed Boise, ID 83707-0006 Tel: 1-208-368-4465 Fax: 1-208-368-4435 Oppenheimer Funds, Inc. Senior Notes $3,000,000 12100 East ILIFF Ave. due 2016 Suite 300 Aurora, Colorado 80014 Tel: 1-888-470-0862 Fax: 1-303-768-1500 Barclays Capital, Inc. Exc Senior $2,621,000 200 Park Avenue, #3W Sub Debentures New York, NY 10166 due 2016 Unliquidated Tel: 1-212-680-6400 Tel: 1-212-526-2179 Fax: 1-646-758-4476 Bane of America Leasing & Vendor $2,458,333 Capital 555 California Street Suite 400 San Francisco, CA 94104 Tel: 1-415-765-7349 Fax: 1-415-765-7418 Lehman Brothers, Inc. Senior Notes $4,900,000 c/o Weil, Gotshall, & Manges due 2016 767 Fifth Street Exc Senior Sub New York, NY 10153 Debentures due Tel: 1.212.310.8000 2016 Fax: 1.212.310.8007 Highbridge Capital Management Exc Senior $2,200,000 9 W 57th St., 27th Floor Sub Debentures New York, NY 10019 due 2016 Tel: 1-212-287-4900 Fax: 1-212-287-4915 Galaxy Capital Trading Ltd. Senior Notes $2,000,000 Folio Chambers due 2016 PO Box 800 Road Town, Tortola D8 V6Il10 Tel: 284-494-7065 Fax: 284-494-8356 Siltronic Corporation Vendor $1,832,482 27620 Farmington road, #208 Farmington Hills, MI 48334 Tel: 1-248-994-8723 Tel: 1-503-243-2020 Tattersall Advisory Group Senior Notes $1,697,000 Inc. (Evergreen) due 2016 6802 Paragon Place, Suite 200 Richmond, VA 23230 Tel: 1-804-289-2663 Fax: 1-804-285-7219 Qimonda Asia Pacific Pte. Vendor $1,666,745 Ltd. 8 Kallang Sector Singapore 349282 Tel: +65 (6876)3888 Fax: +65 (6876)3688 Qimonda North America Corp. 1730 First St, MIS 15302 San Jose, CA 95112 Tel: 1-408-501-7000 Fax: 1-408-501-2444 King & Spalding LLP Vendor $1,637,609 333 Twin Dolphin Drive - Suite 400 Disputed Redwood Shores, CA 94065 Tel: 1-650-590-0700 Fax: 1-650-590-1900 Sonnenschein Nath & Rosenthal Vendor $1,584,395 LLP 1301 K Street, NW East Tower, 6th Floor Washington, DC 20005 Tel: 1-202-408-6400 Fax: 1-202-408-6399 QVT Financial LP Senior Notes $1,533,300 1177 Avenue of the Americas due 2016 New York, NY 10036 Tel: 1-212-221-9143 Fax: 1-917-934-4740 DNS Electronics, LLC Vendor $1,484,532 820 Kifer Road, Suite B Sunnyvale, CA 94086 Tel: 1-408-523-9140 Fax: 1-408-523-9150 Nissin Trade debt- $1,400,000 17-1, Ginza 6-chome supplier Chuo-ku Disputed Tokyo 104-8023, Japan Tel: 03-3543-5523 Fax: +81 (0)3 354-62669 Novellus Systems, Inc. Vendor $1,366,741 4000 North First Street San Jose, CA 95134 Tel: 1.408.943.9700 Fax: 1.408.943.0202 HCL Technologies Ltd. Vendor $1,362,044 Corporate Office A-10111, Sector - 3 Disputed Noida - 20 I 301, Uttar Pradesh, India Tel: +91-120-253-5071 Fax: +91-120-253-0591 Fidelix Co., Ltd. Vendor $1,261,959 2F SC First Bank Blvd. 6-8 Sunae-dong Disputed Bungang-gu, Seongnam-si Kyunggi-do, 463-825 South Korea Tel: 82-31-785-3670 Fax: 823-785-3501 Cadence Design Systems, Inc. Vendor $1,171,400 2655 Seely Road I Building 5 San Jose, CA 95134-1931 Tel: 1-408-943-1234 Fax: 1-408-428-5001 Air Products and Chemicals Vendor $1,089,100 Inc. 720 I Hamilton Boulevard Allentown, PA 18195-1501 Tel: 1-610-481-4911 Fax: 1-610-481-5900 Guggenheim Investment Senior Notes $974,000 Management Co. due 2016 Exc 135 East 57th Street Senior New York, NY 10022 Subordinated Tel: 1-212-319-5001 Debentures Tel: 1-212-739-0700 Elpida Memory, Inc. Vendor $840,859 Sumitomo Seimei Yaesu Bldg. 3F, 2-1 Yaesu 2-chome, Chuoku, Tokyo 104-0028 JAPAN Tel: +81-3-3281-1500 Fax: +81-3-3281-1776 Elpida Memory, Inc. Sunnyvale Office 1175 Sonora Court Sunnyvale, CA 94086 USA Tel: 1-408-542-7000 Fax: 1-408-212-8130 Global Investment Advisors Senior Notes $825,000 Squires Building Suite 117 due 2016 721 US Highway One North Palm Beach, FL 33408 Tel: 1-561-881-9688 Fax: 1-561-881-9680 Ebara Technologies, Inc. Vendor $805,588 51 Main Avenue Sacramento, CA 95838 Tel: 1-916-920-5451 Fax: 1-916-830-1900 Attn: Brian Castle Ebara Technologies, Inc. 2157-H, O'Toole Avenue San Jose, CA 95131 Tel: 1-408-325-7001 Fax: 1-916-830-1900 Cascade Microtech, Inc. Vendor $785,042 2430 NW 206th Avenue Beaverton, Oregon 97006, USA Tel: 1-503-601-1000 Fax: 1-503-601-1002 Volt Vendor $771,764 Los Angeles, CA 90074-3102 Tel: 1-714-921-5768 Fax: 1-714-921-7061 Iuternatioual Sematech Vendor $750,000 2706 Moutopolis Drive Austin, Texas 78741 Disputed Tel: 1-512-356-3500 Fax: 1-512-356-3135 Reich & Taug Asset Senior Notes $750,000 Management, LLC 600 Fifth Avenue New York, NY 10020 Tel: 1-212-265-3398 Tel: 1-800-676-6779 McKinsey & Company, Inc. Vendor $708,000 The Cira Centre 2929 Arch Street, Suite 1400 Philadelphia PA 19104-289 Tel: 1-215-594-4500 Fax: 1-215-594-4478 McKinsey & Company, Inc. Taunustor 2 60311 Frankfurt am Main Germany Tel: 49 (69) 71-620 Fax: 49 (69) 71-625700 Conti Temic (Continental) Warranty Contingent Microelectronic GMBH claimant unliquidated Postfach 10 09 54 disputed Ingolstadt 85009 Germany Tel: +49-84-8810 Fax: +49-841-81-2265 Continental Teves, Inc. One Continental Drive Auburn Hills, MI 48326, USA Tel: 1-248-393-5300 Fax: 1-248-393-5301 Robert Bosch Warranty Contingent Attn. CLP9 claimant unliquidated 11970 Pellicano, Suite 100 disputed El Paso, TX 79936 Tel: 1-915-872-0272 Robert Bosch LLC 38000 Hills Tech Drive Farmington Hills, M1 48331 Tel: 1-248-876-1000 Fax: 1-248-876-1116 The petition was signed by Dario Sacomani, executive vice president and chief financial officer. STANDARD STEEL: Moody's Downgrades Corporate Family Rating to B3 ---------------------------------------------------------------- Moody's Investors Service has downgraded the corporate family and probability of default ratings of Standard Steel, LLC to B3 from B2. The rating outlook has been changed to negative from stable. The downgrade reflects impact of a weakening new railcar build market that will likely cause Standard Steel's 2009 revenues to be less than previously anticipated. As well, higher input costs should cause margins to be flat or lower year-over-year. The combined impact of lower than expected revenues and margins will increase the potential for an early 2009 financial ratio covenant breach under the company's credit agreements. Lower total earnings in 2009 will also decrease the company's ability to generate a meaningful level of free cash flow for debt reduction near term. The negative outlook reflects: 1) a soft new railcar build environment that will pressure credit metrics near term and decrease the company's cash flow generation capacity; 2) a weak liquidity profile that will likely remain pressured unless the company can obtain credit agreement amendments to provide headroom under its financial ratio covenant tests. The company's first and second lien credit agreements each feature an aggressive covenant step down schedule through July 2010, and since 2009 will likely be a year of lower than expected earnings, covenant relief under both credit agreements will likely be necessary for test periods into 2010. Sustained access to the company's $20 million first lien revolving credit facility will depend on Standard Steel's ability to loosen the financial ratio covenant test levels enough to accommodate the weakened operating outlook. The B3 corporate family rating reflects several negative and positive characteristics. The negative include: high to moderate leverage, significant customer concentration, small revenue base, and exposure to a soft new railcar build outlook. The positive characteristics include: a high degree of sector consolidation which softens price competition, the long-term need for railcar replacement wheel manufacturing capacity, a substantial proportion of 2009 manufacturing capacity covered under contracts and the existence of raw material pricing surcharge provisions. The rating acknowledges that in 2008, following a plant expansion, Standard Steel was materially free cash flow generative which suggests that the company could resume material free cash flow generation once the demand environment improves. Additional ratings changes: -- $20 million first lien revolving credit facility due 2011 - to B3, LGD 3, 45% from B2, LGD 3, 45% -- $100 million first lien term loan due 2012 - to B3, LGD 3, 45% from B2, LGD 3, 45% -- $20 million first lien delayed draw term loan due 2012 - to B3, LGD 3, 45% from B2, LGD 3, 45% -- $25 million second lien term loan due 2013 - to Caa2, LGD 6, 92% from Caa1, LGD 6, 92% The last rating action occurred on December 12, 2008 when the company's B2 corporate family rating was affirmed. Standard Steel's ratings were assigned by evaluating factors Moody's believe are relevant to the credit profile of the issuer, such as i) the business risk and competitive position of the company versus others within its industry, ii) the capital structure and financial risk of the company, iii) the projected performance of the company over the near to intermediate term, and iv) management's track record and tolerance for risk. These attributes were compared against other issuers both within and outside of Standard Steel's core industry and Standard Steel's ratings are believed to be comparable to those of other issuers of similar credit risk. Standard Steel, LLC, based in Burnham, Pennsylvania, manufactures forged wheels and axles used in freight and passenger rail cars and locomotives. The company had last twelve month September 2008 revenues of approximately $221 million. STANFORD INT'L BANK: Hearing on US$8 Bln Fraud Case Set Today ------------------------------------------------------------- A hearing on the US$8 billion fraud case against Texas businessman Robert Allen Stanford and his companies will be held today, March 2, The Wall Street Journal reports. As reported in the Troubled Company Reporter-Latin America on Feb. 19, 2009, the U.S. Securities and Exchange Commission charged Mr. Stanford and three of his companies for orchestrating a fraudulent, multi-billion dollar investment scheme centering on an US$8 billion Certificate of Deposit program. Mr. Stanford's companies include Antiguan-based Stanford International Bank Limited (SIBL), Houston-based broker-dealer and investment adviser Stanford Group Company (SGC), and investment adviser Stanford Capital Management. The SEC also charged SIBL chief financial officer James Davis as well as Laura Pendergest- Holt, chief investment officer of Stanford Financial Group (SFG), in the enforcement action. Last week, the Journal discloses federal prosecutors filed criminal charges against Ms. Pendergest-Holt, accusing her of obstructing the investigation. She pleaded not guilty and was released on US$300,000 bond, the Journal says. The SEC's complaint, filed in federal court in Dallas, alleges that acting through a network of SGC financial advisers, SIBL has sold approximately US$8 billion of so-called "certificates of deposit" to investors by promising improbable and unsubstantiated high interest rates. These rates were supposedly earned through SIBL's unique investment strategy, which purportedly allowed the bank to achieve double-digit returns on its investments for the past 15 years, SEC's complaint said. The Journal meanwhile discloses that in an amended civil complaint filed Friday, the SEC alleged Mr. Stanford, Mr. Davis and Ms. Pendergest-Holt used fabricated financial information to defraud investors who bought $8 billion in certificates of deposit. According to the Journal, the three Stanford executives told investors that SIBL, the offshore bank based in Antigua that marketed the CDs, had received a US$541 million capital injection in November 2008. That never happened, the SEC said in the revised complaint obtained by the Journal. About SIBL Domiciled in Antigua, Stanford International Bank Limited -- http://www.stanfordinternationalbank.com/-- is a member of Stanford Private Wealth Management, a global financial services network with US$51 billion in deposits and assets under management or advisement. Stanford Private Wealth Management serves more than 70,000 clients in 140 countries. TENNECO INC: Fitch Downgrades Issuer Default Rating to 'B' ---------------------------------------------------------- Fitch Ratings has downgraded the Issuer Default Rating and outstanding debt ratings of Tenneco, Inc.: -- IDR downgraded to 'B' from 'B+'; -- Senior secured bank credit facility to 'BB-/RR2' from 'BB+/RR1'; -- Senior secured notes to 'CCC/RR6' from 'BB/RR2'; -- Senior unsecured notes to 'CCC/RR6' from 'B-/RR6'; -- Subordinated notes to 'CCC/RR6' from 'CCC+/RR6'. The ratings remain on Rating Watch Negative as discussed in the Dec. 11, 2008 Fitch release titled 'Fitch Places Seven U.S. Auto Suppliers on Rating Watch Negative.' As discussed therein, the Negative Watch is based on the uncertain longer-term federal assistance for the U.S. OEMs (original equipment manufacturers) and the impact of a potential bankruptcy filing by General Motors. In the event of a GM bankruptcy, Fitch's prospective IDR for Tenneco could be downgraded one notch to 'B-'. Approximately $1.5 billion of outstanding debt is covered by these ratings. The downgrades reflect the severe automotive production declines in the fourth quarter of 2008 (4Q08) and beginning of 2009, and Fitch's expectations for an extended decline in global auto volumes, which will continue to pressure Tenneco's credit quality and operating performance. Deep production cuts by domestic and international manufacturers in Tenneco's major product platforms are expected to more than offset any potential growth in Tenneco's global customer base and products through at least the next several quarters. In the near term, diminished product demand will cause a significant drop in EBITDA during a period of increased use of working capital. The weakened credit profile is likely to persist until year-end and recovery in the balance sheet will take some time. Liquidity has decreased over the past year, but Fitch considers it to be adequate for the new rating levels. At year-end 2008, cash on hand was $126 million and availability on the revolving credit facility was $394 million. Important to note, Tenneco does not have any significant debt maturities until 2012. The company has a modestly underfunded pension plan, which, due to losses in the equity and fixed income markets in 2008, is likely to require incremental contributions over the near term. Tenneco recently amended its credit facility to provide it with additional cushion during the industry downturn; the facility expires in 2012. The size and tenor of the facility remain the same, but there is a significant change in covenant ratios. Most significantly, the net leverage covenant increases to 7.35 times (x) and 7.90x during 2Q09 and 3Q09, respectively, illustrating the significant impact the industry environment will likely have on Tenneco's financial results. After those quarters the leverage requirement steps down, indicating that Tenneco's balance sheet strain should be for a limited period. Fitch expects that the change in leverage from the original 3.75x in those quarters will provide Tenneco with needed flexibility during a time when debt levels will increase. Fitch expects that Tenneco's free cash flow could be negative in 2009, but that there are several factors that will limit the magnitude of cash drains. Tenneco remains dedicated to cost- cutting initiatives and cash preservation, and efforts made by the company to reduce headcount and expenses should be realized in 2009. The decline in commodity prices should also be a positive for margin performance in 2009 as escalating material prices have hampered supplier margins over the past several years. Tenneco's capital expenditures increased significantly in 2008 in order to finance the company's expansion, particularly overseas, but in 2009 capital expenditures should decrease significantly, enabling the company to conserve cash flow. The Recovery Ratings reflect Fitch's recovery expectations under a scenario in which distressed enterprise value is allocated to the various debt classes. The RRs were lowered to reflect the deteriorating automotive environment, which lead Fitch to estimate a lower distressed enterprise value under a going concern assumption. RRs on the senior secured facilities (revolving credit facility, Term Loan A, and Tranche B1) were lowered by one notch to 'RR2' which implies a recovery in the range of 71%-90%. The second lien notes were downgraded four notches from 'RR2' to 'RR6', which reflects a recovery in the range of 0%-10%. The 'RR6' ratings for the senior unsecured notes and subordinated notes are unchanged. Short-term results for the automotive and commercial truck industries are expected to be weak given the extended shutdowns among U.S. manufacturers and the decline in global production expected in 2009. Financial support from the government to the auto suppliers is possible in the near term; however, it is not part of Fitch's assumptions. Aid to the auto suppliers would be viewed as a favorable action. Over the longer term, Tenneco's expanding position in the growing emissions segment positions the company well to expand its customer base and volumes. Product demand should increase given plans for tighter emission standards. Tenneco's migration to more technological, value-added products should also support margins. Historically, Tenneco had a track record of efficient working capital management and manufacturing cost improvements. These efforts should help offset expected cyclical volume declines. TEREX CORP: S&P Affirms Corporate Credit Ratings at 'BB' -------------------------------------------------------- Standard & Poor's Ratings Services affirmed its ratings, including the 'BB' long-term corporate credit rating, on Terex Corp and removed the ratings from CreditWatch, where they had been placed with negative implications on Feb. 12, 2009. The outlook is negative. "The ratings affirmation reflects the company's completion of an amendment to its credit agreement that relaxes the fixed-charge coverage ratio through the first quarter of 2010," said Standard & Poor's credit analyst Dan Picciotto. "However, conditions in key end markets have deteriorated significantly. If the downturn is sustained, headroom under covenants could become limited and credit measures could deteriorate beyond levels S&P expects at the current rating." The ratings on Westport, Conn.-based Terex reflect the company's participation in the highly cyclical and competitive construction equipment industry and its aggressive financial profile. These factors are mitigated by the company's satisfactory business position as a major provider of construction equipment and by its good geographic and product diversity. Terex manufactures a broad range of equipment for the construction, infrastructure, and mining industries. Its business strengths include well-known brands with expanding global market shares, a highly variable cost structure, low-cost products, and significant aftermarket parts sales. Through a number of acquisitions, Terex has grown to become a leading global construction equipment company, with nearly $10 billion in trailing-12-month sales, compared with about $2 billion in 2001. It has good product and geographic diversity, with more than half of its sales coming from outside the U.S. Terex has emphasized foreign acquisitions, and has funded acquisitions with a combination of debt and equity to temper leverage. The company is current on its filing requirements with the SEC after completing an extensive accounting review to resolve imbalances in certain intercompany accounts. The SEC is investigating the restatement of Terex's financial statements for 2000-2003, and the company is cooperating and providing information. In addition, Terex has received a subpoena from the SEC relating to transactions between the company and United Rentals Inc., and is cooperating with this investigation as well. S&P will reassess its view of the ratings and outlook if these inquiries uncover accounting problems that affect Terex's liquidity and access to its revolving credit facility. S&P could lower the ratings if Terex's credit measures deteriorate outside S&P's range of expectations. For instance, if its adjusted ebt to EBITDA appears likely to exceed 4x S&P could take a negative ratings action, although sizable cash balances could provide an offset. The company's acquisitiveness and exposure to cyclical markets continue to limit upside rating potential. TOYS R US: Bank Loan Sells at Near 75% Discount ----------------------------------------------- Participations in a syndicated loan under which Toys R Us is a borrower traded in the secondary market at 55.50 cents-on-the- dollar during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. This represents an increase of 2.50 percentage points from the previous week, the Journal relates. The loan matures on July 19, 2012. Toys R Us pays 425 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B2 rating and Standard & Poor's BB- rating. Syndicated loans of fellow retailers slid in secondary market trading during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. Participations in a syndicated loan under which Burlington Coat Factory Warehouse Corp is a borrower traded in the secondary market at 35.29 cents-on-the-dollar, a drop of 2.13 percentage points -- at 37.42 cents-on-the-dollar -- from the previous week. The syndicated loan matures May 28, 2013. Burlington Coat pays 225 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B3 rating and Standard & Poor's CCC+ rating. Participations in a syndicated loan under which Michaels Stores Inc. is a borrower traded in the secondary market at 56.36 cents- on-the-dollar, a drop of 1.83 percentage points -- 58.19 cents-on- the-dollar -- from the previous week. The bank loan matures October 31, 2013. Michaels Stores pays 225 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B2 rating and Standard & Poor's B rating. Neiman Marcus Group Inc. bank debt traded in the secondary market at 65.07 cents-on-the-dollar, a drop of 1.80 percentage points -- at 66.86 cents-on-the-dollar -- from the previous week. The bank loan matures April 6, 2013. Neiman Marcus pays 175 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's Ba3 rating and Standard & Poor's BB rating. Meanwhile, bank debt of video-rental company Blockbuster Inc. traded in the secondary market at 69.20 cents-on-the-dollar. Trading in the bank debt increased 1.90 percentage points from the previous week, the Journal relates. The loan matures August 20, 2011. Blockbuster pays 375 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B1 rating and Standard & Poor's B rating. About Toys R Us Based in Wayne, New Jersey, Toys R Us sells toys, baby-juvenile products and children's apparel worldwide. Toys "R" Us - Domestic provides toy and juvenile product offerings in 49 states and Puerto Rico and sells merchandise through Internet sites; and Toys "R" Us - International operates, licenses or franchises stores in 33 foreign countries. As of November 1, 2008, there were 1,546 wholly owned and franchised "R" Us branded retail stores worldwide. * * * As reported by the Troubled Company Reporter on December 19, Standard & Poor's Ratings Services revised its outlook on Toys "R" Us Inc. to negative from stable. S&P has affirmed all the ratings on the Wayne, New Jersey-based company, including the 'B' corporate credit rating. S&P has also affirmed the debt issued by subsidiaries Toys "R" Us Delaware Inc. and U.S. Propco. "The outlook revision reflects our belief that Toys will be more challenged than previously anticipated in the important fourth quarter of 2008 and early 2009," said Standard & Poor's credit analyst Ana Lai, "due to a deepening spending pull-back by consumers in the current weak U.S. economic environment." Credit protection measures will likely deteriorate to levels that are weak for the rating. TRIBUNE CO: Halts Efforts to Sell Chicago Tower/La Times Bldg. -------------------------------------------------------------- Tribune Company has suspended efforts to sell the Tribune Tower in Chicago, Illinois, and the Times Mirror Square in Los Angeles, California, because the company does not expect to find buyers, Tribune Bankruptcy News reported, citing a February 25 report by Bloomberg's Courtney Dentch. Tribune, Ms. Dentch said, is looking for other options for the buildings. Among others, Tribune spokesman Gary Weitman said the company is working with real estate firms to secure tenants and determine other uses of the buildings, Bloomberg related. Mr. Weitman clarified that a sale of the buildings is still an option, contrary to a Craig's Business report that said the company has scrapped its plans to sell the properties. "Given the downturn in the real estate market, a sale is less likely now, but we continue working with our advisors on other ways of maximizing the value of these properties," Mr. Weitman told the LA Times, whose headquarters is in the Times Mirror Square building. That might include renting space in Tribune- owned buildings to tenants, the Times said. "There's certainly interest [in the building], but this isn't the time," Stephanie Pater, Tribune's director of real estate, told the Associated Press on February 26. Tribune, AP related, has been trying to sell the Times Mirror Square since the summer of 2008. Undisclosed sources, according to AP, said Tribune's financial situation raises question about its long-term ability to pay rent, a critical factor in a potential sale-leaseback transaction. In addit About Tribune Co. Headquartered in Chicago, Illinois, Tribune Company -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The company and 110 of its affiliates filed for Chapter 11 protection on December 8, 2008 (Bankr. D. Del. Lead Case No. 08-13141). The Debtors proposed Sidley Austion LLP as their counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. and Alvarez & Marsal North Americal LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As of Dec. 8, 2008, the Debtors have $7,604,195,000 in total assets and $12,972,541,148 in total debts. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TRIBUNE CO: Bank Loan Sells at 75% Off in Secondary Market ---------------------------------------------------------- Participations in a syndicated loan under which The Tribune Company is a borrower traded in the secondary market at 25.93 cents-on-the-dollar during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. This represents a drop of 1.75 percentage points from the previous week, the Journal relates. The loan matures May 17, 2014. Tribune pays 300 basis points over LIBOR to borrow under the facility. Moody's has withdrawn its rating on the bank loan. The bank debt carries Standard & Poor's default rating. About Tribune Co. Headquartered in Chicago, Illinois, Tribune Company -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The company and 110 of its affiliates filed for Chapter 11 protection on December 8, 2008 (Bankr. D. Del. Lead Case No. 08-13141). The Debtors proposed Sidley Austion LLP as their counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. and Alvarez & Marsal North Americal LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As of Dec. 8, 2008, the Debtors have $7,604,195,000 in total assets and $12,972,541,148 in total debts. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TROPICANA OPCO: Bank Loan Sells at 77% Off in Secondary Market -------------------------------------------------------------- Participations in a syndicated loan under which Tropicana Opco is a borrower traded in the secondary market at 23.17 cents-on-the- dollar during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. This represents a drop of 2.50 percentage points -- at 25.67 cents-on-the-dollar -- from the previous week, the Journal relates. The bank loan matures on January 3, 2012. Tropicana Opco pays 250 basis points over LIBOR to borrow under the facility. Moody's has withdrawn its rating on the bank loan. The bank debt is not rated by Standard & Poor's. As reported by the Troubled Company Reporter on Feb. 3, 2009, Tropicana Entertainment, LLC, said the lenders who funded its acquisition of five casinos pre-bankruptcy are now undersecured and will only receive up to 72.7% recovery for their over $1.3 billion in claims. Tropicana and its affiliated debtors have sought permission from the U.S. Bankruptcy Court for the District of Delaware to halt interest payments to the OpCo Lenders. In exchange for their use of their lenders' cash collateral to partly fund their Chapter 11 cases, Tropicana previously obtained permission to make adequate protection payments to the Opco Lenders, headed by Credit Suisse, as administrative agent and collateral agent; Credit Suisse Securities (USA) LLC, as sole bookrunner and sole lead arranger; Barc1ays Bank PLC and Societe Generale, as co-lead arrangers and co-syndication agents; and The Royal Bank of Scotland, PLC and INO Capital, LLC. Before filing for bankruptcy protection, Tropicana, in 2007, entered into credit facilities to finance its acquisition of Aztar Corp.'s five casinos. The OpCo Credit Facility -- an aggregate US$1,710,000,000 secured credit facility provided by Credit Suisse as collateral agent and administrative agent -- constituted the largest portion of the Aztar Acquisition financing. As of April 30, 2008, about $1,300,000,000 of the principal amount was outstanding under a term loan facility, and $21,000,000 under a revolving facility. According to Mark D. Collins, Esq., at Richards, Layton & Finger, P.A., Tropicana has determined that the value of the OpCo Lenders' collateral does not exceed their claims under the Prepetition Financing Documents. Consequently, the OpCo Lenders are undersecured. In January, Tropicana Entertainment and its affiliates filed a Chapter 11 plan of reorganization for entities led by Tropicana Entertainment, which own 10 casinos and resorts in Atlantic City, New Jersey and Evansville, Indiana; (OpCo Plan), and another by Tropicana Las Vegas Holdings, which own a resort in Las Vegas (LandCo Plan). Mr. Collins relates that the valuation analysis included in the OpCo Disclosure Statement reflects the fact that the value of the reorganized OpCo Debtors is not sufficient to satisfy the OpCo Lenders' claims in full. The Debtors estimate that the OpCo Lenders are likely to recover between 58.1% and 72.7% of the value of their claims if the OpCo Plan is continued and between 36% and 48% in a liquidation scenario, if the Debtors' cases me converted to chapter 7 liquidations. Mr. Collins notes that the ad hoc group of OpCo Lenders in the case -- the steering committee for the OpCo Lenders -- has admitted at a hearing before Judge Kevin J. Carey that the value of the assets is much less than the amount of their claims. Absent Court approval of the proposal, Tropicana will be required to make payments totaling $44.3 million between February 1, 2009 and June 30, 2009. The Bankruptcy Court will convene a hearing on Feb. 17 to consider the request. Objections are due Feb. 9. About Tropicana Entertainment Based in Crestview Hills, Kentucky, Tropicana Entertainment LLC -- http://www.tropicanacasinos.com/-- is an indirect subsidiary of Tropicana Casinos and Resorts. The company is one of the largest privately-held gaming entertainment providers in the United States. Tropicana Entertainment owns eleven casino properties in eight distinct gaming markets with premier properties in Las Vegas, Nevada, and Atlantic City, New Jersey. Tropicana Entertainment LLC filed for Chapter 11 protection on May 5, 2008, (Bankr. D. Del. Case No. 08-10856). Its debtor- affiliates filed for separate Chapter 11 petitions but with no case numbers assigned yet. Kirkland & Ellis LLP and Mark D. Collins, Esq., at Richards Layton & Finger, represent the Debtors in their restructuring efforts. Their financial advisor is Lazard Ltd. Their notice, claims, and balloting agent is Kurtzman Carson Consultants LLC. Epiq Bankruptcy Solutions LLC is the Debtors' Web site administration agent. AlixPartners LLP is the Debtors' restructuring advisor. Stroock & Stroock & Lavan LLP and Morris Nichols Arsht & Tunnell LLP represent the Official Committee of Unsecured Creditors in this case. Capstone Advisory Group LLC is financial advisor to the Creditors' Committee. Bankruptcy Creditors' Service, Inc., publishes Tropicana Bankruptcy News. The newsletter tracks the chapter 11 restructuring proceedings commenced by Tropicana Entertainment LLC and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). TRUMP ENTERTAINMENT: Seeks to Hire McCarter & English as Counsel ---------------------------------------------------------------- Trump Entertainment Resorts Inc. and its debtor-affiliates ask the United States Bankruptcy Court for the District of New Jersey for permission to employ McCarter & English LLP as their bankruptcy counsel. The firm will: a) advise the Debtors of their powers and duties as debtors- in-possession in the continued operation of their businesses and management of their properties; b) assist, advise and represent the Debtors in their consultations with creditors regarding the administration of these cases; c) provide assistance, advice and representation concerning the preparation and negotiation of a plan of reorganization and disclosure statement and any asset sales, equity investments or other transactions proposed in connection with these chapter 11 cases; d) provide assistance, advice and representation concerning any investigation of the assets, liabilities and financial condition of the Debtors that may be required; e) represent the Debtors at hearings on matters pertaining to their affairs as a debtors-in-possession; f) prosecute and defend litigation matters and such other matters that might arise during and related to the chapter II cases, except to the extent that the Debtors have employed or hereafter seek to employ special litigation counsel; g) provide counseling and representation with respect to the assumption or rejection of executory contracts and leases and other bankruptcy-related matters arising from these cases; h) take necessary action to protect and preserve the Debtors' estates, including the prosecution of actions on behalf of the Debtors, the defense of any actions commenced against the Debtors as to which the automatic stay does not apply, other than actions defended in the ordinary course of the Debtors' business and objection to claims filed against the Debtors' estates; and i) perform other legal services as may be necessary and appropriate for the efficient and economical administration of the chapter 11 Debtors. The firm's professionals and their compensation rates are: Partners Hourly Rate ________ ___________ Charles A. Stanziale, Jr., Esq. $575 Joseph Lubertazzi, Jr., Esq. $495 Lisa S. Bonsall, Esq. $495 Curtis A. Johnson, Esq. $485 Carol Stem, Esq. $450 Jeffrey T. Testa, Esq. $390 Brian Baker, Esq. $390 Associates Hourly Rate __________ ___________ Kathleen Keating, Esq. $350 Angela S. Abreu, Esq. $315 Veronica Montagna, Esq. $280 Meena Untawale, Esq. $275 Paralegals Hourly Rate __________ ___________ Steve Bechtler $210 Stacy Lipstein $175 Ceil Beirne $175 Other professionals of the firm who will provide services to the Debtors will be paid at these rates: Designation Hourly Rate __________ ___________ Partners $375-$680 Associates $205-$395 Law Clerks $145-$190 Paralegals $125-$225 Charles A. Stanziale, Esq., attorney at the firm, assures the Court that the firm is a "disinterested person" as defined in Section 101(14) of the United States Bankruptcy Code. About Trump Entertainment Based in Atlantic City, New Jersey, Trump Entertainment Resorts Inc. (NASDAQ: TRMP) -- http://www.trumpcasinos.com/-- owns and operates three casino hotel properties in Atlantic City, New Jersey, which include Trump Taj Mahal Casino Resort, Trump Plaza Hotel and Casino, and Trump Marina Hotel Casino. The Company conducts gaming activities and provides customers with casino resort and entertainment. Donald Trump is a shareholder of the Company and, as its non- executive Chairman, is not involved in the daily operations of the company. The Company is separate and distinct from Mr. Trump's privately held real estate and other holdings. Trump Entertainment Resorts, TCI 2 Holdings, LLC and other affiliates filed for Chapter 11 on Feb. 17, 2009 (Bankr. D. N.J., Lead Case No. 09-13654). The Company has tapped Charles A. Stanziale, Jr., Esq., at McCarter & English, LLP, as lead counsel, and Weil Gotshal & Manges as co-counsel. Ernst & Young LLP is the Company's auditor and accountant and Lazard Freres & Co. LLC is the financial advisor. The Company disclosed assets of $2,055,555,000 and debts of $1,737,726,000 as of Dec. 31, 2008. TRUMP ENTERTAINMENT: Seeks to Hire Garden City as Claims Agent -------------------------------------------------------------- Trump Entertainment Resorts Inc. and its debtor-affiliates ask the United States Bankruptcy Court for the District of New Jersey for permission to employ The Garden City Group Inc. as their claims, noticing, balloting and disbursement agent. The firm will: a) prepare and serve required notices in the chapter 11 cases, including: -- notices of the commencement of the chapter 11 cases and the initial meeting of creditors under section 341(a) of the Bankruptcy Code; -- notices of the claims bar date; -- notices of objections to claims; -- notices of any hearings on a disclosure statement and confirmation of a plan or plans of reorganization; and -- such other miscellaneous notices as the Debtors or the Court may deem necessary or appropriate for an orderly administration of these chapter 11 cases; b) Within five business days after the service of a particular notice, file with the Clerk's Office a certificate or affidavit of service that includes: -- a copy of the notice served; -- an alphabetical list of persons on whom the notice was served, along with their address; and -- the date and manner of service; c) maintain copies of all proofs of claim and proofs of interest filed in these cases; d) maintain official claims registers in this case by docketing all proofs of claim and proofs of interest in a claims database that includes the following information for each such claim or interest asserted: -- the name and address of the claimant or interest holder and any agent thereof, if the proof of claim or proof of interest was filed by an agent; -- the date the proof of claim or proof of interest was received by Clerk; the claim number assigned to the proof of claim or proof of interest; and -- the asserted amount and classification of the claim; e) implement necessary security measures to ensure the completeness and integrity of the claims registers; f) transmit to the Clerk's Office a copy of the claims registers on a monthly basis, unless requested by the Clerk's Office on a more or less frequent basis; g) maintain an up-to-date mailing list for all entities that have filed proofs of claim or proofs of interest with the Clerk and make such list available upon request by the Clerk's Office or any party in interest; h) provide access to the public for examination of copies of the proofs of claim or proofs of interest filed in this case without charge during regular business hours; j) record all transfers of claims pursuant to Rule 3001(e) and provide notice of such transfers as required by Rule 300; j) comply with applicable federal, state, municipal and local statutes, ordinances, rules, regulations, orders and other requirements; k) provide temporary employees to process claims, as necessary; i) promptly comply with further conditions and requirements as the Clerk's Office or the Court may at any time prescribe; and m) provide other claims processing, noticing, balloting, and related administrative services as may be requested from time to time by the Debtors. The firm's professionals will be compensated at these rates: Designation Hourly Rate ----------- ----------- Senior Management $250 Directors, Senior Consultants, and Assistant Vice Presidents $175-$250 Project Managers, Senior Project Managers, and Department Managers $125-$150 Graphic Support $125 Systems & Technology Staff $100-$200 Project Supervisors $95-$110 Quality Assurance Staff $80-$125 Project Administrators $70-$85 Customer Service Rep's $57 Mailroom and Claims Control $55 Data Entry Processors $50 Administrative $45-$60 David A. Isaac, chief executive office at the firm, assures the Court that the firm is a "disinterested person" as defined in Section 101(14) of the United States Bankruptcy Code. About Trump Entertainment Based in Atlantic City, New Jersey, Trump Entertainment Resorts Inc. (NASDAQ: TRMP) -- http://www.trumpcasinos.com/-- owns and operates three casino hotel properties in Atlantic City, New Jersey, which include Trump Taj Mahal Casino Resort, Trump Plaza Hotel and Casino, and Trump Marina Hotel Casino. The Company conducts gaming activities and provides customers with casino resort and entertainment. Donald Trump is a shareholder of the Company and, as its non- executive Chairman, is not involved in the daily operations of the company. The Company is separate and distinct from Mr. Trump's privately held real estate and other holdings. Trump Entertainment Resorts, TCI 2 Holdings, LLC and other affiliates filed for Chapter 11 on Feb. 17, 2009 (Bankr. D. N.J., Lead Case No. 09-13654). The Company has tapped Charles A. Stanziale, Jr., Esq., at McCarter & English, LLP, as lead counsel, and Weil Gotshal & Manges as co-counsel. Ernst & Young LLP is the Company's auditor and accountant and Lazard Freres & Co. LLC is the financial advisor. The Company disclosed assets of $2,055,555,000 and debts of $1,737,726,000 as of Dec. 31, 2008. TRUMP ENTERTAINMENT: Seeks To Tap Weil Gotshal as Co-Counsel ------------------------------------------------------------ Trump Entertainment Resorts Inc. and its debtor-affiliates ask the United States Bankruptcy Court for the District of New Jersey for permission to employ Weil, Gotshal & Manges LLP as their co- counsel. The firm will: a) advise the Debtors of their powers and duties as debtors-in- possession in the continued operation of their businesses and management of their properties; b) assist, advise and represent the Debtors in their consultations with creditors regarding the administration of Trump's Chapter 11 cases; c) provide assistance, advice and representation concerning the preparation and negotiation of any plan or plans of reorganization and related disclosure statement(s) and any asset sales, equity investments or other transactions proposed in connection with these chapter II cases; d) provide assistance, advice and representation concerning any investigation of the assets, liabilities and financial condition of the Debtors that may be required; e) represent the Debtors at hearings on matters pertaining to their affairs as debtors in possession; f) prosecute and defend litigation matters and such other matters that might arise during and related to the chapter 11 cases, except to the extent that the Debtors have employed or hereafter seek to employ special litigation counsel; g) prepare, on behalf of the Debtors, as debtors in possession, certain motions, applications, answers, orders, reports, and other papers in connection with the administration of the Debtors' estates; h) provide counseling and representation with respect to the assumption or rejection of executory contracts and leases and other bankruptcy-related matters arising from these cases; i) take necessary action to protect and preserve the Debtors' estates, including the prosecution of actions on behalf of the Debtors, the defense of any actions commenced against the Debtors, the negotiation of disputes in which the Debtors are involved, and the preparation of objections to claims filed against the Debtors' estates; and j) perform all other necessary legal services that arise in connection with these chapter 11 cases. Weil Gotshal will be paid based on the hourly rates charged by its professionals and will be reimbursed for out-of-pocket expenses. The hourly rates of the firm's professionals are: Designation Hourly Rate ----------- ----------- Partners $650-$950 Counsel $650-$950 Associates $355-$640 Paralegals $155-$310 Michael F. Walsh, Esq., member at the firm, assures the Court that the firm is a "disinterested person" as defined in Section 101(14) of the United States Bankruptcy Code. About Trump Entertainment Based in Atlantic City, New Jersey, Trump Entertainment Resorts Inc. (NASDAQ: TRMP) -- http://www.trumpcasinos.com/-- owns and operates three casino hotel properties in Atlantic City, New Jersey, which include Trump Taj Mahal Casino Resort, Trump Plaza Hotel and Casino, and Trump Marina Hotel Casino. The Company conducts gaming activities and provides customers with casino resort and entertainment. Donald Trump is a shareholder of the Company and, as its non- executive Chairman, is not involved in the daily operations of the company. The Company is separate and distinct from Mr. Trump's privately held real estate and other holdings. Trump Entertainment Resorts, TCI 2 Holdings, LLC and other affiliates filed for Chapter 11 on Feb. 17, 2009 (Bankr. D. N.J., Lead Case No. 09-13654). The Company has tapped Charles A. Stanziale, Jr., Esq., at McCarter & English, LLP, as lead counsel, and Weil Gotshal & Manges as co-counsel. Ernst & Young LLP is the Company's auditor and accountant and Lazard Freres & Co. LLC is the financial advisor. The Company disclosed assets of $2,055,555,000 and debts of $1,737,726,000 as of Dec. 31, 2008. TRW AUTOMOTIVE: Bank Debt Continues Slump; Sells at 43% Discount ---------------------------------------------------------------- Participations in a syndicated loan under which TRW Automotive is a borrower traded in the secondary market at 57.20 cents-on-the- dollar during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. This represents a drop of 7.13 percentage points -- at 64.33 cents-on-the-dollar -- from the previous week, the Journal relates. The loan matures on February 9, 2014. TRW Automotive pays 150 basis points to borrow under the facility. The bank loan carries Moody's Ba1 rating and Standard & Poor's BBB- rating. Syndicated loans of other auto parts makers also slid in secondary market trading during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. Visteon Corp. bank debt continued its slide, trading in the secondary market at 17.71 cents-on-the-dollar during the week ended February 27, 2009. This represents a drop of 2.50 percentage points -- at 20.21 cents-on-the-dollar -- from the previous week. The loan matures May 30, 2013. Visteon pays 300 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B3 rating and Standard & Poor's B- rating. Dana Corporation bank debt traded at 30.43 cents-on-the-dollar during the week ended February 27, 2009, a drop of 2.97 percentage points -- at 33.40 cents-on-the-dollar -- from the previous week. The loan matures January 31, 2015. Dana pays 375 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B3 rating and Standard & Poor's B+ rating. Lear Corp. bank debt traded at 34.57 cents-on-the-dollar. This represents a drop of 3.99 percentage points -- at 38.56 cents-on- the-dollar -- from the previous week. The loan matures March 29, 2012. Lear pays 250 basis points above LIBOR to borrow under the facility. The bank loan is not rated. Syndicated loan of Avis Budget Car Rental LLC traded in the secondary market at 37.80 cents-on-the-dollar, a drop of 3.92 percentage points from the previous week. The loan matures on April 1, 2012. Avis Budget pays 125 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's Ba3 rating and Standard & Poor's B rating. Hertz Corporation bank debt traded in the secondary market at 65.85 cents-on-the-dollar, a decrease of 2.37 percentage points from the previous week. The loan matures on December 21, 2012. Hertz pays 150 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's Ba1 rating and Standard & Poor's BB+ rating. About TRW Automotive TRW Automotive, Inc., headquartered in Livonia, Michigan, is among the world's largest and most diversified suppliers of automotive systems, modules, and components to global vehicle manufacturers and related aftermarket. Standard & Poor's Ratings Services says TRW is one of the world's 10 largest manufacturers of original equipment automotive parts and designs. Nearly 70% of its sales comes from outside North America; its largest customer, Volkswagen AG, accounts for about 17% of sales. Combined sales to the Michigan-based automakers account for about 22% of TRW's consolidated revenues, S&P says. The Company has three operating segments; Chassis Systems, Occupant Safety Systems, and Automotive Components. Its primary business lines encompass the design, manufacture and sale of active and passive safety related products. Revenues in 2007 were approximately $14.7 billion. * * * As reported by the Troubled Company Reporter on January 15, 2009, Standard & Poor's Ratings Services lowered its ratings on TRW Automotive Inc., including the corporate credit rating, which was lowered to 'BB' from 'BB+'. The outlook is negative. TRUMP ENTERTAINMENT: Gets Initial Approval to Use Cash Collateral ----------------------------------------------------------------- The Hon. Judith H. Wizmur of the United States Bankruptcy Court for the District of New Jersey authorized Trump Entertainment Resorts Inc. and its debtor affiliates to access cash collateral securing repayment of secured loans to their prepetition secured lenders until June 5, 2009. A hearing will be held on March 17, 2009, at 10:00 a.m., to consider final approval of the request. Objections, if any, are due March 12, 2009, by 4:00 p.m. Troubled Company Reporter said on Feb. 20, 2009, an immediate need exists for Trump Entertainment Resorts Inc., and its affiliates to use cash collateral in order to continue the operation of their business, relates John P. Burke, the company's executive vice president and chief financial officer. He asserts that without use of those funds, the Debtors' trade creditors will cease to provide goods and services to the Debtors on credit, and the Debtors will not be able to pay their payroll and other direct operating expenses and obtain goods and services needed to carry on their businesses in a manner that will avoid irreparable harm to the Debtors' estates. The Debtors owe $488.8 million to lenders who are backed by first priority liens on Trump Entertainment and its affiliates' assets, and $1.2 billion to lenders who have second liens on Trump's assets. In exchange for the use of their cash collateral, the Debtors will grant adequate protection to the Prepetition Secured Parties in the form of: -- postpetition replacement liens in substantially all of the Debtors' assets and -- valid non-voidable liens existing as of the Petition Date. The Replacement Liens secure for the Prepetition Secured Parties (x) the aggregate diminution, if any, whether by use, sale, lease, depreciation, decline in market price or otherwise of their respective Collateral (including the cash collateral), or the imposition of the automatic stay and (y) the sum of the aggregate amount of all cash proceeds of their respective cash collateral and the aggregate fair market value of all of their respective non-cash Collateral. Mr. Burke asserts that the ability of the Debtors to finance their operations and the availability to the Debtors of sufficient working capital and liquidity through the use of cash collateral is vital to the confidence of the Debtors' employees, major suppliers and to the preservation and maintenance of the going concern values and other values of the Debtors' estates. The Company won't be looking for secured financing, a company officer told Bloomberg News. A full-text copy of the Debtors' cash collateral budget is available for free at: http://ResearchArchives.com/t/s?39f4 About Trump Entertainment Based in Atlantic City, New Jersey, Trump Entertainment Resorts Inc. (NASDAQ: TRMP) -- http://www.trumpcasinos.com/-- owns and operates three casino hotel properties in Atlantic City, New Jersey, which include Trump Taj Mahal Casino Resort, Trump Plaza Hotel and Casino, and Trump Marina Hotel Casino. The Company conducts gaming activities and provides customers with casino resort and entertainment. Donald Trump is a shareholder of the company and, as its non-executive Chairman, is not involved in the daily operations of the company. The company is separate and distinct from Mr. Trump's privately held real estate and other holdings. Trump Entertainment Resorts, TCI 2 Holdings, LLC and other affiliates filed for Chapter 11 on Feb. 17, 2009 (Bankr. D. N.J., Lead Case No. 09-13654). The Company has tapped Charles A. Stanziale, Jr., Esq., at McCarter & English, LLP, as lead counsel, and Weil Gotshal & Manges as co-counsel. Ernst & Young LLP is the Company's auditor and accountant and Lazard Freres & Co. LLC is the financial advisor. The Company disclosed assets of $2,055,555,000 and debts of $1,737,726,000 as of Dec. 31, 2008. TRW AUTOMOTIVE: Fitch Downgrades Issuer Default Rating to 'B+' -------------------------------------------------------------- Fitch Ratings has downgraded TRW's ratings: TRW Automotive Holdings Corp. -- Issuer Default Rating to 'B+' from 'BB-'. TRW Automotive Inc. -- IDR to 'B+' from 'BB-'; -- Senior unsecured notes to 'B-/RR6' from 'B+'. In addition, Fitch's existing ratings and assigned Recovery Ratings are: TRW Automotive Inc. -- Senior secured revolving credit facility at 'BB/RR2'; -- Senior secured term loan A facility at 'BB/RR2'; -- Senior secured term loan B facility at 'BB/RR2'. All ratings remain on Rating Watch Negative where they were placed on Dec. 11, 2008. The ratings cover approximately $3.2 billion in outstanding debt. The downgrades are prompted by ongoing weakness in the global automotive industry which has exhibited a sharper drop than Fitch previously expected. Fitch expects global automotive market weakness to continue through 2009, with first quarter-2009 (1Q'09) being the quarter with the steepest decline in sales. Weak demand will hurt EBITDA and could pressure TRW's cash flow. TRW has been working to restructure its operations and adjust to the cuts in auto production, partially offsetting the negative impact of declining production rates. Although TRW has weathered the U.S. decline to date, the steep production cuts in the U.S. and Europe in 4Q'08 and 1Q'09 should outpace the restructuring benefits to the cost structure. TRW also benefits from the refinancing actions it took in 2007, which lowered the company's interest costs and extended debt maturities. Additionally, Fitch believes TRW has the ability to decrease capital expenditures in 2009, which may be necessary if cash flows are constrained. Furthermore, Fitch forecasts modest negative free cash flow in 2009 under the current auto production assumptions. Factors supporting the ratings include TRW's relatively diverse customer base, global manufacturing presence, the company's technology- driven products and liquidity position. The ratings remain on Rating Watch Negative as discussed in the Dec. 11, 2008 Fitch commentary titled 'Fitch Places Seven U.S. Auto Suppliers on Rating Watch Negative.' As discussed in the aforementioned commentary, the Rating Watch Negative is based on the impact of a potential bankruptcy filing by General Motors. Given its smaller profile, it is unlikely that a bankruptcy filing by Chrysler would have the same impact. The RR reflects Fitch's recovery expectations under a scenario in which distressed enterprise value is allocated to the various debt classes. The RR on the senior secured facilities (revolving credit facility, Term Loan A, and Term Loan B) was established with a rating of 'RR2', which implies a recovery in the range of 71-90%. The senior unsecured notes were assigned an RR of 'RR6', which implies a recovery in the range of 0-10%. In the event of a GM bankruptcy, Fitch believes that the resulting contraction in auto production, the supply chain, trade credit and capital access would cause widespread shutdowns and bankruptcies throughout the supply chain. Fitch notes that even if the original equipment manufacturers avoid bankruptcy, major restructurings of their operations will occur, causing material changes in the operations of their Tier I suppliers. In the event of a GM bankruptcy, Fitch's prospective IDR for TRW could be lowered. Earlier this month, TRW announced it drew down the bulk of its $1.4 billion revolving credit facility, and the proceeds were placed on the balance sheet to build liquidity. The company has indicated that this was done to provide it with some protection due to the uncertainty regarding the government's financial support of GM and Chrysler. TRW's liquidity was ample at the end of 2008, totaling nearly $2.1 billion. This liquidity consisted of $756 million of cash, $1.113 million of availability under the company's revolving credit facility, and $249 million under several receivables securitization facilities. Fitch also notes that the fourth quarter is a seasonally high period for cash due to working capital. TRW has no near-term debt maturities and the revolver extends through 2012. Fitch calculates leverage (total net debt to operating EBITDA) at year end 2008 to be 2.1 times (x). If industry conditions worsen through 2009, TRW could pressure its leverage covenants and Fitch expects that TRW will need to work with its lenders for an amendment later in 2009. The secured credit facility requires that the net leverage ratio be no more than 3.75x as of 4Q'08 until 3Q'09; from 4Q'09 and beyond it may be no greater than 3.5x. Fitch expects lenders would be willing to work with TRW to provide covenant relief given the company's position as a global auto supplier with a diverse customer mix and product offering. UPTOWN PARTNERS: Files for Chapter 11 in Manhattan -------------------------------------------------- Bill Rochelle of Bloomberg News reported that Uptown Partners LLC filed for Chapter 11 reorganization after being unable to respond to a cash call arising from its investment as one of the owners of Fifth on the Park Condo LLC. Fifth on the Park is the tallest condominium in New York's Harlem neighborhood. The condo is 30 stories with 160 units on Fifth Avenue and 120th Street, adjacent to Mount Morris Park in Central Harlem. The condo itself isn't in bankruptcy, Bloomberg said. Uptown Partners, LLC, filed for Chapter 11 on February 24, 2009 (Bankr. S.D. N.Y., Case No. 09-10845). Arnold Mitchell Greene, Esq., at Robinson Brog Leinwand Greene Genovese & Gluck, P.C., has been tapped as counsel. In its bankruptcy petition, the Company estimated assets and debts of $10 million to $50 million. VALASSIS CORP: Bank Debt Sells at 30% Discount ---------------------------------------------- Participations in a syndicated loan under which Valassis Communications is a borrower traded in the secondary market at 69.83 cents-on-the-dollar during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. This represents an increase of 2.42 percentage points from the previous week, the Journal relates. The loan matures March 2, 2014. Valassis pays 175 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's Ba2 rating and Standard & Poor's B+ rating. About Valassis Communications Valassis Communications, Inc. -- http://www.valassis.comor http://www.redplum.com-- is a media and marketing services company, serving more than 15,000 advertisers. Its RedPlum media portfolio delivers value on a weekly basis to over 100 million shoppers across a multi-media platform - in-home, in-store and in- motion. Headquartered in Livonia, Michigan with approximately 7,000 associates in 28 states and nine countries, Valassis is recognized for its associate and corporate citizenship programs, including its America's Looking for Its Missing Children(R) program. Valassis companies include Valassis Direct Mail, Inc., Valassis Canada, Promotion Watch, Valassis Relationship Marketing Systems, LLC and NCH Marketing Services, Inc. * * * As reported by the Troubled Company Reporter on February 24, 2009, Valassis Communications received notice from the New York Stock Exchange on Feb. 20, 2009, that it was not in compliance with certain continued listing standards applicable to its common stock. The notice indicates that Valassis is below criteria because both the average market capitalization of its common stock over a consecutive 30 trading-day period was less than $75 million and its stockholder equity was less than $75 million. The TCR said January 19, 2009, that Standard & Poor's Ratings Services lowered its corporate credit rating on Valassis Communications to 'B' from 'B+'. This rating, as well as all issue-level ratings on Valassis, was removed from CreditWatch, where it was placed with negative implications on Nov. 6, 2008. The rating outlook is negative. VCSP LLC: Voluntary Chapter 11 Case Summary ------------------------------------------- Debtor: VCSP LLC 3400 Carillon Point Kirkland, WA 98033 Bankruptcy Case No.: 09-12390 Chapter 11 Petition Date: February 24, 2009 Court: District of Nevada (Las Vegas) Judge: Linda B. Riegle Debtor's Counsel: Gayle Bush, esq. Bush Strout & Kornfeld 601 Union Street, Suite 5500 Seattle, WA 98101 Tel: (206) 292-2110 Estimated Assets: $10 million to $50 million Estimated Debts: $10 million to $50 million The Debtor did not file a list of 20 largest unsecured creditors. The petition was signed by Paul Bressan. VIDEOTRON LTEE: Moody's Assigns 'Ba2' Rating on $200 Mil. Notes --------------------------------------------------------------- Moody's Investors Service assigned a Ba2 rating to Videotron Ltee's US$200 million senior unsecured note issue. Videotron is a wholly-owned subsidiary of Quebecor Media Inc. The new issue is an add-on to existing 9.125% senior unsecured note issue due 2018 that was rated last April. As part of the rating action, QMI's Ba3 corporate family rating and probability of default rating were affirmed along with the stable ratings outlook. In addition, QMI's consolidated speculative grade liquidity rating was upgraded to SGL-2 (indicating good liquidity) from SGL-3 (indicating adequate liquidity). Videotron will use the proceeds from the offering to repay drawings under its senior secured revolving credit facility with any excess being for general corporate purposes. With the impact of anticipated incremental debt not expected to cause a permanent increase in leverage, the company's Ba3 CFR and related long term debt ratings were affirmed, and the new add-on note issue was rated at the same Ba2 ratings level as the underlying reference security. While the new debt offering does not impact QMI's CFR, probability of default rate or expected family recovery rate, the transaction necessitates adjustments to QMI's consolidated waterfall of liabilities. In turn, with the application of Moody's loss given default methodology, this causes ratings of individual debt instruments in the QMI corporate family to be adjusted (refer to debt listing below). Rating Actions: Assignments: Issuer: Videotron Ltee -- Senior Unsecured Regular Bond/Debenture (add-on to existing rated instrument), Assigned Ba2 (LGD3, 32%) Upgrades: Issuer: Quebecor Media, Inc. -- Speculative Grade Liquidity Rating, Upgraded to SGL-2 from SGL-3 Affirmations and LGD Assessment Adjustments: Issuer: Quebecor Media, Inc. -- Senior Secured Bank Credit Facility, unchanged at B1, with the LGD assessment revised to LGD5, 74% from LGD5, 73% Issuer: Sun Media Corporation -- Senior Unsecured Regular Bond/Debenture, unchanged at Ba2 with the LGD assessment revised to LGD3, 32% from LGD2, 29% Issuer: Videotron Ltee -- Senior Unsecured Regular Bond/Debenture (reference instrument for above noted rating assignment), unchanged at Ba2 with the LGD assessment revised to LGD3, 32% from LGD2, 29% The SGL upgrade was prompted by the pay-down of Videotron's credit facility that will result from the new note issue. With that, each of QMI and its key operating subsidiaries will have substantially un-drawn credit facilities. In addition, access thereto is not expected to be limited by financial covenant compliance matters. This is despite expected usage during the year resulting from recessionary pressures at the two newspaper publishing entities and capital expenditures at Videotron. QMI's practice of arranging financing piecemeal rather on a consolidated basis implies that liquidity is not seen as a credit-strength. This is especially the case at the parent holding company since the receipt of dividends is conditional upon compliance with financial covenants and restricted payments baskets at its operating companies. However, given the size of and access to the respective credit facilities, the aggregate of these factors supports an SGL-2 rating. Moody's most recent rating action concerning Quebecor Media, Inc., was taken on April 7, 2008, at which time the company's Ba3 CFR and PDR were affirmed in conjunction with a new note issue in the name of Videotron Ltee being rated Ba2. Headquartered in Montr�al, Canada, Videotron is a wholly-owned subsidiary of Quebecor Media Inc., a privately held (see below) leading Canadian media holding company. Through its operating companies, QMI has activities in cable distribution, business, residential and mobile wireless telecommunications (collectively, Videotron), newspaper publishing (Sun and Osprey Media), television broadcasting, book, magazine and video retailing, publishing and distribution, music recording, production and distribution and new media services. VIDEOTRON LTEE: S&P Puts BB- Rating on Proposed $260MM Notes ------------------------------------------------------------ Standard & Poor's Ratings Services said it assigned its debt issue and recovery ratings to Montreal-based Videotron Ltee's proposed US$260 million senior unsecured notes due April 2018. Videotron is a 100%-owned subsidiary of Montreal-based Quebecor Media Inc. The notes and the guarantees are senior unsecured obligations of Videotron, ranking equally with all existing and future unsecured unsubordinated debt of the company. S&P rates the notes at 'BB-' (the same as the corporate credit rating on Quebecor Media), with a recovery rating of '4', indicating lenders can expect an average (30%-50%) recovery in the event of a payment default. At the same time, S&P affirmed its 'BB-' debt rating on Videotron's existing senior unsecured notes. The recovery rating is unchanged at '4' indicating an expectation of average (30%-50%) recovery in a default scenario. S&P has also affirmed all other ratings, including the 'BB-' long- term corporate credit rating, on Videotron, Quebecor Media, and another subsidiary, Sun Media Corp. The outlook on all companies is stable. Proceeds from the proposed US$260 million notes offering will be used to repay balances outstanding under Videotron's senior secured revolving credit facility and for general corporate purposes. "The ratings on Quebecor Media are based on the credit risk profile of the company and its consolidated subsidiaries, including 100%-owned Videotron, the largest cable operator in Quebec, and third-largest in Canada; and 100%-owned Sun Media, the largest newspaper publisher in Canada when including Osprey Media Income Fund," said Standard & Poor's credit analyst Madhav Hari. The ratings on both Videotron and Sun Media are equalized with those on the parent. "The ratings on Quebecor Media reflect our view of the company's highly leveraged financial risk profile characterized by high adjusted debt leverage, weak cash flow protection measures, and an aggressive financial policy," Mr. Hari added. The ratings are also based on what S&P view as the weaker business risk profile of Quebecor Media's mature newspaper division, which continues to face industry-specific as well as economy-related challenges; intense competition at the company's various business segments; and high capital expenditures in its cable segment. S&P believes that the launch of a facilities-based wireless service in Quebec (in early 2010), while potentially positive in the long term, will require significant upfront capital investment in the next two years, keeping debt leverage high while pressuring free cash flow. These factors are partially offset by what S&P view as the investment-grade profile of the company's fast-growing cable operations, which comprised about 48% of 2008 revenue and about 71% of consolidated 2008 EBITDA, and added diversity provided by its various media operations, which should continue generating meaningful free cash flow in the medium term despite challenging industry conditions. The stable outlook reflects S&P's expectations that Videotron parent Quebecor Media's key operations will maintain their solid market position and that the company's adjusted debt leverage will not materially vary from Standard & Poor's 4x threshold for the rating. Although unlikely in the near term, S&P could consider revising the outlook to positive in the medium term if the company demonstrates that it can generate sustainable free cash flow and if its credit metrics improve, likely from continued growth of overall EBITDA. Alternatively, S&P could revise the outlook to negative if the print advertising revenue-dependent newspaper operations deteriorate materially or if the company pursues a more aggressive wireless strategy, which results in a weakening of Quebecor Media's operating performance and consolidated credit metrics. VISTEON CORP: Bank Debt Continues Major Slide; Sells at 82% Off --------------------------------------------------------------- Participations in a syndicated loan under which Visteon Corp. is a borrower traded in the secondary market at 17.71 cents-on-the- dollar during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. This represents a drop of 2.50 percentage points -- at 20.21 cents-on-the-dollar -- from the previous week, the Journal relates. The loan matures May 30, 2013. Visteon pays 300 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B3 rating and Standard & Poor's B- rating. Syndicated loans of other auto parts makers also slid in secondary market trading during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. Participations in a syndicated loan under which TRW Automotive is a borrower traded in the secondary market at 57.20 cents-on-the- dollar, a drop of 7.13 percentage points -- at 64.33 cents-on-the- dollar -- from the previous week. The loan matures on February 9, 2014. TRW Automotive pays 150 basis points to borrow under the facility. The bank loan carries Moody's Ba1 rating and Standard & Poor's BBB- rating. Dana Corporation bank debt traded at 30.43 cents-on-the-dollar during the week ended February 27, 2009, a drop of 2.97 percentage points -- at 33.40 cents-on-the-dollar -- from the previous week. The loan matures January 31, 2015. Dana pays 375 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B3 rating and Standard & Poor's B+ rating. Lear Corp. bank debt traded at 34.57 cents-on-the-dollar. This represents a drop of 3.99 percentage points -- at 38.56 cents-on- the-dollar -- from the previous week. The loan matures March 29, 2012. Lear pays 250 basis points above LIBOR to borrow under the facility. The bank loan is not rated. Syndicated loan of Avis Budget Car Rental LLC traded in the secondary market at 37.80 cents-on-the-dollar, a drop of 3.92 percentage points from the previous week. The loan matures on April 1, 2012. Avis Budget pays 125 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's Ba3 rating and Standard & Poor's B rating. Hertz Corporation bank debt traded in the secondary market at 65.85 cents-on-the-dollar, a decrease of 2.37 percentage points from the previous week. The loan matures on December 21, 2012. Hertz pays 150 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's Ba1 rating and Standard & Poor's BB+ rating. About Visteon Corp. Headquartered in Van Buren Township, Michigan, Visteon Corporation (NYSE: VC) -- http://www.visteon.com/-- is an automotive supplier that designs, engineers and manufactures innovative climate, interior, electronic and lighting products for vehicle manufacturers, and also provides a range of products and services to aftermarket customers. The company has corporate offices in Van Buren Township, Mich. (U.S.); Shanghai, China; and Kerpen, Germany. It has facilities in 27 countries and employs roughly 35,500 people. * * * As reported in the Troubled Company Reporter on Nov. 4, 2008, Visteon Corporation's balance sheet at Sept. 30, 2008, showed total assets of US$5.9 billion and total liabilities of US$6.4 billion, resulting in shareholders' deficit of roughly US$530 million. The company reported a net loss of US$188 million on total sales of US$2.11 billion. For third quarter 2007, Visteon reported a net loss of US$109 million on sales of US$2.55 billion. Visteon reported a net loss of US$335 million for the first nine months of 2008, compared with a net loss of US$329 million for the same period a year ago. The TCR said on Jan. 14, 2009, that Standard & Poor's Ratings Services lowered its corporate credit rating on Visteon Corp. to 'CCC' from 'B-' and removed all the ratings from CreditWatch, where they had been placed on Nov. 13, 2008, with negative implications. The outlook is negative. At the same time, S&P also lowered its issue-level ratings on the company's debt. The TCR reported on Nov. 27, 2008, that Moody's Investors Service lowered Visteon Corporation's corporate family and probability of default ratings to Caa2, and Caa1, respectively. In a related action, Moody's also lowered the ratings of Visteon's senior secured term loan to B3 from Ba3, unguaranteed senior unsecured notes to Caa3 from Caa2, and guaranteed senior unsecured notes to Caa2 from Caa1. Visteon's Speculative Grade Liquidity remains SGL-3. The outlook is negative. Bankruptcy Filing Imminent Speculations of a bankruptcy filing abound at Visteon. As reported by the Troubled Company Reporter, citing The Wall Street Journal, the embattled autoparts maker has reportedly brought in Kirkland & Ellis LLP as bankruptcy counsel and Rothschild Inc. as financial adviser to prepare for a possible bankruptcy filing. According to the Journal's John D. Stoll and Jeffrey McCracken, people familiar with the matter said that Visteon and its advisers are studying whether it should file for bankruptcy pre-emptively to conserve its cash. WHEELING-PITTSBURGH: Asks Court to Formally Close Chap. 11 Cases ---------------------------------------------------------------- Wheeling-Pittsburgh Steel Corporation and PCC Survivor Corporation f/k/a Pittsburgh-Canfield Corporation ask the U.S. Bankruptcy Court for the Northern District of Ohio to enter a final decree and formally close their chapter 11 cases commenced in 2000. On July 5, 2001, in connection with the sale of Pittsburgh- Canfield Corporation's assets to a subsidiary of WHX Corporation, Pittsburgh-Canfield Corporation changed its name to PCC Survivor Corporation. All of the original debtors' pending bankruptcy cases have been closed with the exception of the Pittsburgh- Canfield Corporation, case number 00-43394 and the Wheeling- Pittsburgh Steel Corporation, case number 00-43396. On May 19, 2003, WPSC and its affiliates filed their Third Amended Joint Plan of Reorganization. On June 18, 2003, the Court entered an Order Confirming the Debtors' Third Amended Joint Plan of Reorganization under chapter 11 of the Bankruptcy Code. The Plan was consummated, with an Effective Date of August 1, 2003. Pursuant to the Plan, reorganized Wheeling-Pittsburg Corporation (having been merged with one company and subsequently sold to another) is the beneficial owner of 100% of the stock of WPSC. The companies tell the Honorable Kay Woods that the bankruptcy estates have been fully administered, and they have paid all fees required to be paid under 28 U.S.C. Sec. 1930 to the United States Trustee. The companies are represented by: James M. Lawniczak, Esq. Tiiara N. A. Patton. Esq. CALFEE, HALTER & GRISWOLD LLP 1400 KeyBank Center 800 Superior Avenue Cleveland, Ohio 44114-2688 Telephone: (216) 622-8200 Facsimile: (216) 241-0816 Email: jlawniczak@calfee.com tpatton@calfee.com - and - Michael E. Wiles, Esq. Richard F. Hahn, Esq. DEBEVOISE & PLIMPTON 919 Third Avenue New York, New York 10022 Telephone: (212) 909-6000 Facsimile: (212) 909-6836 WILLIAMS COS: S&P Assigns 'BB+' Rating on $600 Mil. Senior Notes ---------------------------------------------------------------- Standard & Poor's Ratings Services said it affirmed its 'BBB-' corporate credit rating on diversified energy company The Williams Cos. Inc. and its affiliates. At the same time, S&P assigned a 'BB+' issue rating to Williams' $600 million senior unsecured notes due 2020. The company will use proceeds for general corporate purposes, including the funding of capital expenditures. The outlook is stable. The affirmation follows S&P's periodic review and ongoing surveillance of the company, including management's decision to indefinitely postpone any strategic restructuring, which may have involved the separation of one or more of the company's principal business units. "Despite substantial decreases in commodities prices and a resulting deterioration in financial metrics, the affirmation reflects S&P's view that Williams will continue to demonstrate financial performance commensurate with our expectations," said Standard & Poor's credit analyst Michael Grande. When S&P raised the ratings to investment grade on Nov. 9, 2007, S&P believed the company would achieve funds from operations interest coverage of 4.0x-5.0x and FFO to debt in the 24%-30% range. The subsequent run-up in commodity prices resulted in financial metrics much stronger than S&P initially anticipated, which has provided ample cushion for the rating, with current FFO to adjusted debt of about 34% as of Dec. 31, 2008. Based on the company's current price outlook for Rockies gas between $3.00 and $4.50 per million Btu, Mid-Continent prices between $3.75 and $5.00 per mmBtu, and average natural gas liquid margins between 22 and 35 cents per gallon, S&P expects Williams to be at the lower end of S&P's originally estimated ratio range in 2009. As part of its review, S&P revised the company's financial profile to intermediate from aggressive, reflecting Williams' demonstrated financial policies that have been supportive of its investment- grade rating, including the reduction of capital spending commensurate with lower expected cash flows in its exploration and production segment, a consistent hedging policy, and the company's prudent management of liquidity. The ratings on Williams reflect the company's stable cash flows from its pipeline assets, ample liquidity, strong competitive position in the Piceance Basin, its largely fee-based midstream business, and good asset diversity. A weak commodity price environment for natural gas and NGL, capital-spending requirements that continue to outpace cash flow, and potential cash flow pressures at midstream master limited partnership Williams Partners L.P. partially offset company strengths. The stable outlook reflects S&P's view that Williams will achieve FFO to debt of between 23% and 28% and FFO interest coverage of 4x to 5x for fiscal 2009. S&P also expect the company to maintain excess liquidity of at least $1 billion and continue to prudently manage its E&P capital spending, with additional downward revisions if commodity prices remain weak. An outlook revision to positive is unlikely in the current price environment, but is possible if Williams strengthens its cash flows and achieves higher financial metrics. Specifically, FFO to debt of 30% or higher through the commodities cycle supports upwards ratings momentum. A negative outlook could be warranted if a persistently weak commodity price environment results in lower cash flows, which could result in FFO to debt below 20% and total debt to EBITDA of 3.5x. S&P could also revise the outlook to negative if substantially weaker cash flows in the midstream segment require parental support, which may pressure Williams' consolidated financial profile. WL HOMES: Organizational Meeting to Form Panel on March 3 --------------------------------------------------------- Roberta A. DeAngelis, Acting United States Trustee for Region 3, will hold an organizational meeting on March 3, 2009, at 1:00 p.m. in the bankruptcy cases of WL Homes LLC and its affiliates. The meeting will be held at J. Caleb Boggs Federal Building, 844 King Street, Room 5209, in Wilmington. The sole purpose of the meeting will be to form a committee or committees of unsecured creditors in the Debtors' cases. The organizational meeting is not the meeting of creditors pursuant to Section 341 of the Bankruptcy Code. A representative of the Debtor, however, may attend the Organizational Meeting, and provide background information regarding the bankruptcy cases. To increase participation in the Chapter 11 proceeding, Section 1102 of the Bankruptcy Code requires that the United States Trustee appoint a committee of unsecured creditors as soon as practicable. The Committee ordinarily consists of the persons, willing to serve, that hold the seven largest unsecured claims against the debtor of the kinds represented on the committee. Section 1103 of the Bankruptcy Code provides that the Committee may consult with the debtor, investigate the debtor and its business operations and participate in the formulation of a plan of reorganization. The Committee may also perform other services as are in the interests of the unsecured creditors whom it represents. Headquartered in Irvine, California, WL Homes LLC dba John Laing Homes -- sells and builds houses. The Debtor and five of its affiliates filed for Chapter 11 protection on February 19, 2009 (Bankr. D. Del. Lead Case No. 09-10571). Laura Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachulski Stang Ziehl & Jones LLP, represent the Debtors' in their restructuring efforts. When the Debtors sought protection from their creditors, they listed assets of More than $1 billion, and debts between $500 million to $1 billion. WYNN RESORTS: S&P Affirms Corporate Credit Rating at 'BB' --------------------------------------------------------- Standard & Poor's Ratings Services affirmed its ratings on Las Vegas, Nevada-based Wynn Resorts Ltd. and its wholly owned subsidiary, Wynn Las Vegas LLC, including the 'BB' corporate credit rating. At the same time, S&P revised its rating outlook on each entity to negative from stable. The outlook revision follows the recent fourth-quarter earnings announcement in which the company reported consolidated property level EBITDA of $127.5 million, down 35% from the prior comparable period (down about 20% with a normalized hold in Las Vegas). While a significant portion of the decline was due to the lower hold percentage, S&P's outlook for 2009 calls for continued EBITDA declines in both Las Vegas and Macau, and S&P's rating incorporates an expectation for 2009 EBITDA declines in the mid- teens percentage area across the portfolio. This level of decline reflects difficult economic conditions in the U.S. that are continuing to pressure visitation, room rates, and spend on the Las Vegas Strip, and negative visitation and spend trends in Macau due to tightened visa restrictions and weaker overall economic conditions. S&P's rating also anticipates only a modest rebound in 2010 across the portfolio. This scenario would result in consolidated leverage reaching the mid-7x area by the end of 2009, and EBITDA interest coverage drifting below 2.5x--both weak for the current rating. Still, despite the challenging intermediate-term outlook, S&P's rating affirmation acknowledges the strength of Wynn's liquidity position. While S&P expects leverage to spike to the mid-7x area by the end of this year, the company also holds a significant cash position, much of which S&P considers excess. S&P estimates that net leverage, incorporating about $800 million to $1 billion of estimated excess cash, will peak at slightly above 6x. In addition, debt maturities are limited to just $375 million through 2010, and the company holds cash at the parent level sufficient to meet this maturity. Furthermore, while the company earmarked approximately $500 million of cash balances at the Wynn Macau subsidiary for development of Encore at Wynn Macau, pro forma leverage was only slightly above 3x at that entity as of Dec. 31, 2008, which should allow for solid free cash flow generation, even given the challenges facing the Macau market. The ability to move cash from the Macau entity to the parent in a tax-efficient manner also enhances the company's overall liquidity position. While covenant cushions under the Las Vegas credit facility may be tight later in 2009, depending on the extent of declines on the Las Vegas Strip, S&P believes that Wynn's strong liquidity position will allow management the flexibility to effectively address any covenant issues with its bank group. S&P also believes that the quality of Wynn's Las Vegas properties, in addition to their good location among a cluster of high-end casino resorts on the Strip, will result in the company being one of the first to benefit from a rebound in the gaming sector. Still, S&P remains cautious that 2010 may continue to be challenging, as CityCenter will introduce substantial capacity to the Las Vegas Strip later this year. "The 'BB' rating reflects Wynn's significant debt burden, high levels of competition in the Las Vegas and Macau markets, and S&P's expectation for continued declines in cash flow generation over at least the next few quarters," said Standard & Poor's credit analyst Ben Bubeck. "Still, the company's assets are among the highest quality in the gaming sector, and S&P expects that Wynn's solid liquidity position will allow the company to weather a prolonged gaming downturn. Pro forma for a recent $500 million revolver draw in Macau, S&P estimate that consolidated gross debt leverage was approximately 6.8x as of Dec. 31, 2008." When assessing Wynn's credit quality, S&P considers the consolidated entity, despite the distinct financing structures at Wynn Resorts and the Las Vegas and Macau entities. S&P deems the strategic relationship between the parent and each subsidiary as an important factor that has a bearing on the credit quality of the overall consolidated entity. However, the notching of S&P's issue-level ratings recognizes the distinct financing structures. XIOM CORP: Dec. 31 Balance Sheet Upside Down by $456,001 -------------------------------------------------------- Xiom Corp. reported sales of $292,356 and cost of sales of $182,349 for the quarter ended December 31, 2008. This is in comparison to sales of $309,281 and cost of sales of $246,276 for the quarter ended December 31, 2007. Gross profit for the quarter ended December 31, 2008, was $110,007 or 38%, an increase of $47,002 or 75% compared to the gross profit for the quarter ended December 31, 2007, of $63,005 or 20%. While sales are comparable, the increase in gross profit is attributable to reductions in system manufacturing costs and increased margins on powder sales compared to the prior period. Selling, general and administrative expenses increased to $790,560 for the quarter ended December 31, 2008 from $698,327 for the quarter ended December 31, 2007. This increase of $92,233 or 13% was due to: a) An increase of $135,667 in compensation expense related to a the issuance of common shares during 2008 under the Company's Employee Stock Ownership Plan; and b) A reduction of $43,433 related to reductions in consulting engineering expense to refine the thermal spray process and coatings as well as cost containment measures in the areas of financial consulting related to money raising activities, marketing expenses, and general overhead. Other expense increased to $64,815 for the quarter ended December 31, 2008, from $55,411 for the quarter ended December 31, 2007. This increase of $9,404 or 17% was due to: a) An increase of $40,346 or 73% in interest expense related to Convertible Notes Payable and is directly attributable to a comparable increase in the average outstanding balance of such indebtedness during fiscal 2008; and b) The recording of a gain of $30,942 during the quarter ended December 31, 2008, related to the conversion of Convertible Notes Payable into common stock. The net loss increased to $745,368 or $0.06 per share during the quarter ended December 31, 2008, from a net loss of $690,733 or $0.08 per share during the quarter ended December 31, 2007. This increase of $54,635 or 8% related to the changes in gross profit, selling, general and administrative expenses, and other income (expense). The Company has a Stockholders' Deficit of $456,001 as of December 31, 2008, from total assets of $2,046,481, total liabilities of $1,832,083, and Common Stock Subject to Rescission Rights of $670,399. "These factors raise substantial doubt about the Company's ability to continue as a going concern," Andrew B. Mazzone, chief executive officer, chief financial and accounting officer, disclosed in a regulatory filing dated February 23, 2009. "However, the Company has seen steady sales orders for the patented industrial thermal spray technology and related powder formulas. Furthermore, the Company plans to continue raising capital through a series of private placement transactions for the balance of fiscal 2009. It also plans to continue to expand sales by significantly increasing domestic marketing efforts, including pursuing major contracts through its network of strategic alliance relationships. As a result of these factors, management believes it will have sufficient resources to meet the Company's cash flow requirements for at least [the next] twelve months." About Xiom Corp. 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. * Auto Industry Bank Debt Continues Slump; TRW Down by 7 Points --------------------------------------------------------------- Syndicated loans of auto parts makers slid in secondary market trading during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. Participations in a syndicated loan under which TRW Automotive is a borrower traded in the secondary market at 57.20 cents-on-the- dollar, a drop of 7.13 percentage points -- at 64.33 cents-on-the- dollar -- from the previous week. The loan matures on February 9, 2014. TRW Automotive pays 150 basis points to borrow under the facility. The bank loan carries Moody's Ba1 rating and Standard & Poor's BBB- rating. Visteon Corp. bank debt continued its slide, trading in the secondary market at 17.71 cents-on-the-dollar during the week ended February 27, 2009. This represents a drop of 2.50 percentage points -- at 20.21 cents-on-the-dollar -- from the previous week. The loan matures May 30, 2013. Visteon pays 300 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B3 rating and Standard & Poor's B- rating. Speculations of a bankruptcy filing by Visteon abound. The embattled autoparts maker has reportedly brought in Kirkland & Ellis LLP as bankruptcy counsel and Rothschild Inc. as financial adviser to prepare for a possible bankruptcy filing. According to The Wall Street Journal's John D. Stoll and Jeffrey McCracken, people familiar with the matter said that Visteon and its advisers are studying whether it should file for bankruptcy pre-emptively to conserve its cash. On Wednesday, Visteon reported a net loss of $43 million on sales of $2.9 billion. For the full year 2008, Visteon reported a net loss of $663 million on sales of $9.5 billion compared with a net loss of $372 million on sales of $11.3 billion for full year 2007. Dana Corporation bank debt traded at 30.43 cents-on-the-dollar during the week ended February 27, 2009, a drop of 2.97 percentage points -- at 33.40 cents-on-the-dollar -- from the previous week. The loan matures January 31, 2015. Dana pays 375 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B3 rating and Standard & Poor's B+ rating. Lear Corp. bank debt traded at 34.57 cents-on-the-dollar. This represents a drop of 3.99 percentage points -- at 38.56 cents-on- the-dollar -- from the previous week. The loan matures March 29, 2012. Lear pays 250 basis points above LIBOR to borrow under the facility. The bank loan is not rated. Syndicated loan of Avis Budget Car Rental LLC traded in the secondary market at 37.80 cents-on-the-dollar, a drop of 3.92 percentage points from the previous week. The loan matures on April 1, 2012. Avis Budget pays 125 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's Ba3 rating and Standard & Poor's B rating. Hertz Corporation bank debt traded in the secondary market at 65.85 cents-on-the-dollar, a decrease of 2.37 percentage points from the previous week. The loan matures on December 21, 2012. Hertz pays 150 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's Ba1 rating and Standard & Poor's BB+ rating. * Failed Banks Tally This Year Already Exceeds 2008's ----------------------------------------------------- Security Savings Bank of Henderson, Nevada, and Heritage Community Bank of Glenwood, Illinois, were seized by regulators at the end of February, bringing this year's tally to 16. According to Bloomberg News, tumbling home prices and surging unemployment caused more borrowers to fall behind on loan payments to banks. According to the Office of the Inspector General of the U.S. Treasury, in the fiscal year 2008, 14 financial institutions with $216 billion in deposits were placed into receivership under FDIC authority. Of these, five were national banks, three were thrifts, and six were state banks. The bulk of deposits were held by two thrifts, Washington Mutual Bank and IndyMac Bank, which together accounted for $207 billion in deposits. Work-out solutions, whereby some or all deposits and assets were assumed by another existing bank, were arranged by FDIC and regulators for all failed institutions except IndyMac Bank. IndyMac Bank was placed under conservatorship and operations were assumed directly by FDIC under a newly-formed IndyMac Federal Bank. The banks closed this year by regulators are: Bank Closing Date ---- ------------ Security Savings Bank, based in Henderson, Nevada 02/27/09 Heritage Community Bank, Glenwood, Ill. 02/27/09 Silver Falls Bank, Silverton, OR 02/20/09 Pinnacle Bank of Oregon, Beaverton, OR 02/13/09 Corn Belt Bank and Trust Company, Pittsfield, IL 02/13/09 Riverside Bank of the Gulf Coast, Cape Coral, FL 02/13/09 Sherman County Bank, Loup City, NE 02/13/09 County Bank, Merced, CA 02/06/09 Alliance Bank, Culver City, CA 02/06/09 FirstBank Financial Services, McDonough, GA 02/06/09 Ocala National Bank, Ocala, FL 01/30/09 Suburban Federal Savings Bank, Crofton, MD 01/30/09 MagnetBank, Salt Lake City, UT 01/30/09 1st Centennial Bank, Redlands, CA 01/23/09 Bank of Clark County, Vancouver, WA 01/16/09 National Bank of Commerce, Berkeley, IL 01/16/09 The FDIC was appointed as receiver for the closed banks. To protect the depositors, the FDIC entered into a purchase and assumption agreement with various banks to assume all of the deposits of the closed banks: Buyer's FDIC Cost Assumed to Insurance Deposits Fund Closed Bank Buyer (millions) (millions) ___________ _____ _______ _____ Security Savings Bank of Nevada, L.V. $175.2 $59.1 Heritage Community MB Financial Bank, N.A. $218.6 $41.6 Silver Falls Citizens Bank $116.3 $50.0 Pinnacle Bank Washington Trust Bank $64.0 $12.1 Corn Belt Bank Carlinville Nat'l Bank $142.4 $100.0 Riverside Bank TIB Bank $281.4 $201.5 Sherman County Heritage Bank $85.1 $28.0 County Bank Westamerica Bank $1,300.0 $135.0 Alliance Bank California Bank & Trust $951.0 $206.0 FirstBank Regions Bank $279.0 $111.0 Ocala National CenterState Bank $205.2 $99.6 Suburban Federal Bank of Essex $302.0 $126.0 MagnetBank -- None -- 1st Centennial First California Bank $302.1 $227.0 Bank of Clark Umpqua Bank $523.6 $120-145 Nat'l Commerce Republic Bank of Chicago $402.1 $97.1 A complete list of banks that failed since 2000 is available at: http://www.fdic.gov/bank/individual/failed/banklist.html 1,000 Banks Billionaire investor Wilbur L. Ross in August 2008 said that 1,000 banks could fail before the credit crisis is over. According to a February 10, 2009 report by MarketWatch, RBC Capital Markets analyst Gerard Cassidy echoed the prediction, saying that more than 1,000 banks could fail in the next three to five years as the recession intensifies and loan losses climb. Mr. Cassidy in 2008 forecast 200 to 300 U.S. bank failures but said that the environment has further deteriorated since then. "Residential mortgage delinquencies remain at record levels, home- equity loan defaults are steadily rising and residential construction and land loan non-performing assets are skyrocketing for lenders with excess exposure to the weakest housing markets in the U.S.," Mr. Cassidy wrote to clients. "In conjunction with the slowdown in the economy, credit deterioration has accelerated in the commercial and industrial and commercial real estate loan areas," he said. * Retailer Bank Debt Slumps in Secondary Market Trading ------------------------------------------------------- Syndicated loans of retailers slid in secondary market trading during the week ended February 27, 2009, according to data compiled by Loan Pricing Corp. and reported in The Wall Street Journal. Participations in a syndicated loan under which Neiman Marcus Group Inc. is a borrower traded in the secondary market at 65.07 cents-on-the-dollar, a drop of 1.80 percentage points -- at 66.86 cents-on-the-dollar -- from the previous week. The bank loan matures April 6, 2013. Neiman Marcus pays 175 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's Ba3 rating and Standard & Poor's BB rating. Michaels Stores Inc. bank debt traded in the secondary market at 56.36 cents-on-the-dollar, a drop of 1.83 percentage points -- 58.19 cents-on-the-dollar -- from the previous week. The bank loan matures October 31, 2013. Michaels Stores pays 225 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B2 rating and Standard & Poor's B rating. Burlington Coat Factory Warehouse Corp bank debt traded in the secondary market at 35.29 cents-on-the-dollar, a drop of 2.13 percentage points -- at 37.42 cents-on-the-dollar -- from the previous week. The syndicated loan matures May 28, 2013. Burlington Coat pays 225 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B3 rating and Standard & Poor's CCC+ rating. Meanwhile, Blockbuster Inc. bank debt traded at 69.20 cents-on- the-dollar, an increase of 1.90 percentage points from the previous week. The loan matures August 20, 2011. Blockbuster pays 375 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B1 rating and Standard & Poor's B rating. Bank debt of toy seller Toys R Us traded at 55.50 cents-on-the- dollar an increase of 2.50 percentage points from the previous week. The loan matures on July 19, 2012. Toys R Us pays 425 basis points over LIBOR to borrow under the facility. The bank loan carries Moody's B2 rating and Standard & Poor's BB- rating. * To Save Retailers, BAPCPA's Timetable for Leases Gets 2nd Look ---------------------------------------------------------------- In April 2005, Congress revised the Bankruptcy Code to counter abuses in the bankruptcy system. The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 shortened debtors' time to decide on whether to assume or reject leases to a mere seven months, disallowed periodic extensions of the debtors' exclusive periods to file a plan of reorganization, and limited bonuses to managers through the key employee retention programs. "BAPCPA's numerous creditor-friendly amendments and modifications have profoundly impacted the Chapter 11 process, to the point that it is nearly impossible for retailers to reorganize, regardless of the prevailing national and international economic conditions," said Lawrence C. Gottlieb, Michael Klein, Ronald R. Sussman, in an article titled BAPCPA's Effects on Retail Chapter 11s Are Profound. The article notes that BACPCA amended Section 365(d)(4) to require debtors to assume or reject their real property leases within 120 says of filing, subject to an additional 90-day court-approved extension. Extensions beyond this initial 210-day period cannot be granted without the consent of the landlord, regardless of the size of the retailer. According to Bankruptcy Creditors Service, Inc., many retailers filed for bankruptcy with a prospect for reorganizing, but ended up closing their stores and liquidating inventory. Retailers covered by BCSI that were unable to keep their business or sell their business as a going concern include Circuit City Stores, Inc., Linens 'n Things, Inc., Mervyn's LLC, Sharper Image and Levitz. The mere 210-day period to decide on the leases, among other changes, provided by the BAPCPA is viewed in some quarters as causing retailers to begin liquidating unnecessarily within three months into Chapter 11, Bloomberg's Bill Rochelle said. Bob Duffy, senior managing director at FTI, said in an article posted at www.turnaround.org, that BAPCPA critics contend that the shortened timetable have had a chilling effect on lenders' willingness to commit normal debtor-in-possession financing to a debtor. By accelerating the timetable to reject store leases, BAPCPA has unwittingly put at risk the value of a retail debtor's two largest sources of collateral: inventory and store leases that can be assigned. Alan D. Smith, Esq., at Perkins Coie LLP, in an article posted at The Journal Corporate Renewal, said that while the 210-day period may be long enough to determine which leases are under market and thus more valuable for assignment/sale purposes, it often is not nearly enough time to determine whether a debtor will survive in its current form, whether it must reduce its operations in certain geographic or other markets and, most significantly, which locations will be most attractive to potential purchasers of the business. Robert L. Eisenbach III, Esq., at Cooley Godward Kronish LLP, said that in the past, retailers usually evaluated sales at stores for at least one holiday shopping season, and sometimes two, before deciding whether to retain the store. Now a retailer has only seven months to make that decision. Pre-BAPCPA, debtors initially had only 60 days to decide on leases, but they were allowed to seek extensions without any statutory limitation. Mr. Smith added prior to the BAPCPA, many retail and other debtors also raised significant amounts of money by selling "lease designation rights" to one of a handful of real estate groups that specialized in that arena. In such a sale, a debtor obtained cash and relief from post-petition rent obligations immediately because the designation rights buyer assumed the obligation to pay all regularly recurring occupancy costs. "BAPCPA effectively killed that market," Mr. Smith said. He noted that even if a debtor could easily identify surplus locations, the Section 365(d)(4) does not provide enough time to produce a meaningful return on most real estate portfolio. March 3 Hearing Congress is scheduled to hold a hearing on March 3 to examine whether to eliminate the 210-day limit for deciding on leases, Bloomberg said, citing a person familiar with the proposed legislation. The content of the hearings isn't public. Congress, according to Bloomberg is also examining whether rules should be changed so homeowners whose houses are worth less than the debt could reduce their mortgage obligations by going through bankruptcy. Bloomberg notes that bankruptcy judges have always had power to trim down the amount of a mortgage, except the mortgage on an individual's principal residence. According to Bloomberg's Bill Rochelle, the theory is that homes will be kept out of foreclosure, adding stability to the housing market, if individuals can reduce their mortgage debts. About 350,000 of the 1 million households would be likely to take advantage of the new law by filing for bankruptcy within the next 10 years, Bloomberg said, citing a February 23 estimate by the Congressional Budget Office. * Fourth Circuit Permits Bifurcating Mobile Home Debt ----------------------------------------------------- The 4th U.S. Circuit Court of Appeals held that individuals in Chapter 13 bankruptcy can't cut down the amount of a home mortgage to the value of the property, Bloomberg's Bill Rochelle said. In the case Enis v. Green Tree Servicing LLC (In re Ennis), 07-2134, there was a dispute over whether individuals could reduce the mortgage on a mobile home, on the theory a mobile home isn't real property. According to Bill Rochelle, most people thought the controversy ended in 2005 when Congress modified the law to say that a principal residence includes a mobile home not attached to real property. The Court of Appeals, reading Congress's choice of words strictly, handed down a decision Feb. 24 saying in Virginia, at least, the owner of a mobile home can cut down the debt to market value, leaving the deficiency an unsecured claim that may be paid little or nothing in the Chapter 13 plan. The report adds that the 4th Circuit ruled that the language used by Congress, read strictly, prohibits cutting down secured debt on a mobile home only if two tests are met: -- The home must be a principal residence. -- It must be real property under state law. In Virginia, a mobile home is considered personal property, not real property. Consequently, the owner was able to chop down the secured debt. * BOND PRICING: For the Week From February 23 - 27, 2009 -------------------------------------------------------- Company Coupon Maturity Bid Price ------- ------ -------- --------- 155 E TROPICANA 8.75% 4/1/2012 44.18 ABITIBI-CONS FIN 7.875% 8/1/2009 36.00 ACE CASH EXPRESS 10.25% 10/1/2014 17.13 AHERN RENTALS 9.25% 8/15/2013 32.27 ALABAMA POWER 5.5% 10/1/2042 70.00 ALERIS INTL INC 9% 12/15/2014 1.00 ALERIS INTL INC 10% 12/15/2016 1.30 ALION SCIENCE 10.25% 2/1/2015 20.00 ALLIED CAP CORP 6% 4/1/2012 14.50 ALLIED CAP CORP 6.625% 7/15/2011 15.00 AMD 5.75% 8/15/2012 41.00 AMD 7.75% 11/1/2012 42.50 AMER AXLE & MFG 5.25% 2/11/2014 22.43 AMER AXLE & MFG 7.875% 3/1/2017 15.94 AMER CAP STRATEG 6.85% 8/1/2012 32.00 AMER GENL FIN 3% 7/15/2009 84.15 AMER GENL FIN 3.05% 6/15/2010 55.16 AMER GENL FIN 3.1% 3/15/2009 66.25 AMER GENL FIN 3.1% 6/15/2009 87.65 AMER GENL FIN 3.1% 7/15/2009 66.71 AMER GENL FIN 3.3% 7/15/2009 87.23 AMER GENL FIN 3.3% 11/15/2009 61.74 AMER GENL FIN 3.3% 6/15/2010 58.00 AMER GENL FIN 3.35% 5/15/2009 91.24 AMER GENL FIN 3.4% 10/15/2009 75.00 AMER GENL FIN 3.45% 4/15/2010 59.45 AMER GENL FIN 3.6% 4/15/2009 94.81 AMER GENL FIN 3.8% 4/15/2009 84.50 AMER GENL FIN 3.85% 9/15/2009 91.85 AMER GENL FIN 3.875% 10/1/2009 65.00 AMER GENL FIN 3.875% 10/15/2009 75.31 AMER GENL FIN 3.875% 11/15/2009 81.00 AMER GENL FIN 3.9% 9/15/2009 78.12 AMER GENL FIN 3.9% 4/15/2010 60.17 AMER GENL FIN 3.9% 4/15/2011 45.31 AMER GENL FIN 4% 6/15/2009 80.49 AMER GENL FIN 4% 8/15/2009 81.17 AMER GENL FIN 4% 9/15/2009 78.03 AMER GENL FIN 4% 11/15/2009 72.21 AMER GENL FIN 4% 11/15/2009 50.10 AMER GENL FIN 4% 11/15/2009 84.50 AMER GENL FIN 4% 12/15/2009 69.87 AMER GENL FIN 4% 12/15/2009 65.00 AMER GENL FIN 4% 12/15/2009 69.75 AMER GENL FIN 4% 3/15/2011 36.50 AMER GENL FIN 4% 4/15/2012 42.00 AMER GENL FIN 4.05% 5/15/2010 40.15 AMER GENL FIN 4.1% 1/15/2010 50.00 AMER GENL FIN 4.1% 5/15/2010 64.00 AMER GENL FIN 4.1% 1/15/2011 45.00 AMER GENL FIN 4.125% 1/15/2010 66.97 AMER GENL FIN 4.15% 11/15/2010 41.00 AMER GENL FIN 4.15% 12/15/2010 49.70 AMER GENL FIN 4.15% 1/15/2011 48.16 AMER GENL FIN 4.2% 8/15/2009 34.25 AMER GENL FIN 4.2% 10/15/2009 79.00 AMER GENL FIN 4.2% 11/15/2009 30.10 AMER GENL FIN 4.2% 10/15/2010 44.75 AMER GENL FIN 4.25% 11/15/2009 72.54 AMER GENL FIN 4.25% 10/15/2010 50.91 AMER GENL FIN 4.3% 3/15/2009 98.75 AMER GENL FIN 4.3% 5/15/2009 91.37 AMER GENL FIN 4.3% 6/15/2009 90.00 AMER GENL FIN 4.3% 9/15/2009 78.38 AMER GENL FIN 4.3% 6/15/2010 80.24 AMER GENL FIN 4.3% 7/15/2010 54.34 AMER GENL FIN 4.3% 9/15/2010 51.74 AMER GENL FIN 4.3% 10/15/2011 37.00 AMER GENL FIN 4.35% 6/15/2009 59.00 AMER GENL FIN 4.35% 6/15/2009 94.50 AMER GENL FIN 4.35% 9/15/2009 78.18 AMER GENL FIN 4.35% 3/15/2010 62.67 AMER GENL FIN 4.4% 5/15/2009 75.00 AMER GENL FIN 4.4% 7/15/2009 69.50 AMER GENL FIN 4.4% 12/15/2010 49.21 AMER GENL FIN 4.5% 7/15/2009 84.57 AMER GENL FIN 4.5% 9/15/2009 65.00 AMER GENL FIN 4.5% 3/15/2010 62.55 AMER GENL FIN 4.5% 8/15/2010 53.39 AMER GENL FIN 4.5% 11/15/2010 51.20 AMER GENL FIN 4.5% 11/15/2011 44.07 AMER GENL FIN 4.55% 10/15/2009 79.00 AMER GENL FIN 4.6% 11/15/2009 72.51 AMER GENL FIN 4.6% 8/15/2010 53.35 AMER GENL FIN 4.6% 9/15/2010 46.00 AMER GENL FIN 4.6% 10/15/2010 51.03 AMER GENL FIN 4.625% 5/15/2009 81.88 AMER GENL FIN 4.625% 9/1/2010 45.02 AMER GENL FIN 4.65% 8/15/2010 61.00 AMER GENL FIN 4.7% 12/15/2009 69.92 AMER GENL FIN 4.7% 10/15/2010 50.64 AMER GENL FIN 4.75% 3/15/2009 98.64 AMER GENL FIN 4.75% 6/15/2010 56.73 AMER GENL FIN 4.75% 8/15/2010 53.48 AMER GENL FIN 4.75% 5/15/2011 46.37 AMER GENL FIN 4.8% 8/15/2009 81.44 AMER GENL FIN 4.8% 9/15/2011 45.20 AMER GENL FIN 4.85% 3/15/2009 98.64 AMER GENL FIN 4.85% 3/15/2009 98.62 AMER GENL FIN 4.85% 10/15/2009 75.69 AMER GENL FIN 4.85% 12/15/2009 77.99 AMER GENL FIN 4.875% 5/15/2010 50.50 AMER GENL FIN 4.875% 6/15/2010 68.63 AMER GENL FIN 4.875% 7/15/2012 48.00 AMER GENL FIN 4.9% 12/15/2009 82.58 AMER GENL FIN 4.9% 3/15/2011 46.64 AMER GENL FIN 4.9% 3/15/2012 41.46 AMER GENL FIN 4.95% 11/15/2010 49.95 AMER GENL FIN 5% 9/15/2009 86.25 AMER GENL FIN 5% 1/15/2010 65.00 AMER GENL FIN 5% 6/15/2010 78.84 AMER GENL FIN 5% 9/15/2010 55.48 AMER GENL FIN 5% 10/15/2010 55.75 AMER GENL FIN 5% 11/15/2010 43.50 AMER GENL FIN 5% 12/15/2010 33.50 AMER GENL FIN 5% 12/15/2010 73.00 AMER GENL FIN 5% 12/15/2010 50.88 AMER GENL FIN 5% 1/15/2011 51.70 AMER GENL FIN 5% 1/15/2011 42.10 AMER GENL FIN 5% 3/15/2011 45.00 AMER GENL FIN 5% 6/15/2011 39.35 AMER GENL FIN 5% 10/15/2011 45.02 AMER GENL FIN 5% 12/15/2011 43.68 AMER GENL FIN 5.1% 6/15/2009 92.93 AMER GENL FIN 5.1% 9/15/2009 78.63 AMER GENL FIN 5.1% 9/15/2010 52.75 AMER GENL FIN 5.1% 3/15/2011 54.97 AMER GENL FIN 5.1% 1/15/2012 43.39 AMER GENL FIN 5.15% 6/15/2009 97.50 AMER GENL FIN 5.15% 9/15/2009 50.00 AMER GENL FIN 5.2% 6/15/2010 65.50 AMER GENL FIN 5.2% 9/15/2010 60.10 AMER GENL FIN 5.2% 5/15/2011 29.75 AMER GENL FIN 5.2% 12/15/2011 42.50 AMER GENL FIN 5.2% 5/15/2012 33.50 AMER GENL FIN 5.25% 6/15/2009 87.97 AMER GENL FIN 5.25% 6/15/2009 87.97 AMER GENL FIN 5.25% 7/15/2010 37.70 AMER GENL FIN 5.25% 4/15/2011 47.40 AMER GENL FIN 5.25% 6/15/2011 60.15 AMER GENL FIN 5.3% 6/15/2009 75.00 AMER GENL FIN 5.35% 6/15/2010 45.51 AMER GENL FIN 5.35% 7/15/2010 52.50 AMER GENL FIN 5.35% 9/15/2011 53.00 AMER GENL FIN 5.375% 9/1/2009 66.75 AMER GENL FIN 5.375% 10/1/2012 46.00 AMER GENL FIN 5.4% 6/15/2011 46.08 AMER GENL FIN 5.4% 6/15/2011 46.08 AMER GENL FIN 5.45% 9/15/2009 78.79 AMER GENL FIN 5.45% 6/15/2011 46.07 AMER GENL FIN 5.45% 10/15/2011 42.63 AMER GENL FIN 5.5% 6/15/2009 88.03 AMER GENL FIN 5.5% 12/15/2010 43.50 AMER GENL FIN 5.5% 4/15/2011 57.36 AMER GENL FIN 5.6% 6/15/2011 46.27 AMER GENL FIN 5.625% 8/17/2011 43.00 AMER GENL FIN 5.85% 9/15/2012 31.70 AMER GENL FIN 6% 7/15/2011 51.69 AMER GENL FIN 6.25% 7/15/2010 79.31 AMER GENL FIN 6.25% 7/15/2011 49.00 AMER GENL FIN 6.25% 7/15/2011 46.73 AMER GENL FIN 6.75% 7/15/2011 40.02 AMER GENL FIN 7.75% 9/15/2010 75.00 AMER GENL FIN 7.85% 8/15/2010 65.00 AMER GENL FIN 7.9% 9/15/2010 54.11 AMER GENL FIN 8% 8/15/2010 55.00 AMER GENL FIN 8.1% 9/15/2011 46.34 AMER GENL FIN 8.125% 8/15/2009 75.00 AMER GENL FIN 8.15% 8/15/2011 55.00 AMER GENL FIN 8.2% 9/15/2011 46.50 AMER GENL FIN 8.375% 8/15/2011 48.93 AMER GENL FIN 8.45% 10/15/2009 70.00 AMER MEDIA OPER 8.875% 1/15/2011 30.00 AMERICREDIT CORP 0.75% 9/15/2011 41.00 AMES TRUE TEMPER 10% 7/15/2012 41.00 AMR CORP 10.13% 6/15/2011 47.75 AMR CORP 10.42% 3/15/2011 60.00 AMR CORP 10.45% 3/10/2011 52.00 ANTHRACITE CAP 11.75% 9/1/2027 19.94 ANTIGENICS 5.25% 2/1/2025 24.32 APPLETON PAPERS 9.75% 6/15/2014 22.50 ARCO CHEMICAL CO 9.8% 2/1/2020 17.00 ARCO CHEMICAL CO 10.25% 11/1/2010 17.50 ARVIN INDUSTRIES 7.125% 3/15/2009 96.50 ARVINMERITOR 8.125% 9/15/2015 22.00 ARVINMERITOR 8.75% 3/1/2012 26.00 ASARCO INC 7.875% 4/15/2013 23.50 ASHTON WOODS USA 9.5% 10/1/2015 19.50 AT HOME CORP 0.5246% 12/28/2018 0.06 ATHEROGENICS INC 1.5% 2/1/2012 11.00 AVENTINE RENEW 10% 4/1/2017 17.00 AVIS BUDGET CAR 7.625% 5/15/2014 26.94 AVIS BUDGET CAR 7.75% 5/15/2016 20.13 BANK NEW ENGLAND 9.875% 9/15/1999 5.38 BANKUNITED CAP 3.125% 3/1/2034 9.38 BARRINGTON BROAD 10.5% 8/15/2014 12.50 BEAZER HOMES USA 4.625% 6/15/2024 31.00 BEAZER HOMES USA 6.5% 11/15/2013 30.09 BEAZER HOMES USA 6.875% 7/15/2015 23.75 BEAZER HOMES USA 8.375% 4/15/2012 35.00 BEAZER HOMES USA 8.625% 5/15/2011 52.50 BELL MICROPRODUC 3.75% 3/5/2024 15.63 BELL MICROPRODUC 3.75% 3/5/2024 18.00 BON-TON DEPT STR 10.25% 3/15/2014 11.50 BON-TON DEPT STR 10.25% 3/15/2014 16.00 BORDEN INC 7.875% 2/15/2023 7.10 BORDEN INC 8.375% 4/15/2016 1.00 BORDEN INC 9.2% 3/15/2021 7.00 BOWATER INC 6.5% 6/15/2013 13.50 BOWATER INC 9% 8/1/2009 28.85 BOWATER INC 9.375% 12/15/2021 19.75 BOWATER INC 9.5% 10/15/2012 14.25 BRODER BROS CO 11.25% 10/15/2010 23.75 BROOKSTONE CO 12% 10/15/2012 48.50 BROOKSTONE CO 12% 10/15/2012 48.88 BUFFALO THUNDER 9.375% 12/15/2014 7.75 BURLINGTON COAT 11.125% 4/15/2014 33.00 CALLON PETROLEUM 9.75% 12/8/2010 52.33 CAPMARK FINL GRP 6.375% 5/10/2012 24.13 CARAUSTAR INDS 7.25% 5/1/2010 50.38 CARAUSTAR INDS 7.375% 6/1/2009 54.47 CCH I LLC 9.92% 4/1/2014 1.50 CCH I LLC 10% 5/15/2014 3.75 CCH I LLC 10% 5/15/2014 9.00 CCH I LLC 11.125% 1/15/2014 2.50 CCH I/CCH I CP 11% 10/1/2015 9.00 CCH I/CCH I CP 11% 10/1/2015 10.50 CCH I/CCH I CP 11% 10/1/2015 35.00 CCH I/CCH I CP 11% 10/1/2015 35.00 CELL GENESYS INC 3.125% 11/1/2011 40.00 CELL THERAPEUTIC 5.75% 12/15/2011 14.50 CHAMPION ENTERPR 2.75% 11/1/2037 10.22 CHAMPION ENTERPR 7.625% 5/15/2009 91.00 CHAPARRAL ENERGY 8.5% 12/1/2015 23.50 CHAPARRAL ENERGY 8.875% 2/1/2017 23.50 CHARTER COMM HLD 9.625% 11/15/2009 102.50 CHARTER COMM HLD 10% 5/15/2011 12.98 CHARTER COMM HLD 11.125% 1/15/2011 5.06 CHARTER COMM INC 6.5% 10/1/2027 5.50 CHENIERE ENERGY 2.25% 8/1/2012 16.50 CIRCUS CIRCUS 7.625% 7/15/2013 10.00 CIT GROUP INC 3.375% 4/1/2009 97.57 CIT GROUP INC 4.125% 11/3/2009 89.50 CITADEL BROADCAS 4% 2/15/2011 40.25 CITIGROUP INC 6.2% 3/15/2009 99.58 CLAIRE'S STORES 9.25% 6/1/2015 19.94 CLAIRE'S STORES 10.5% 6/1/2017 16.75 CLEAR CHANNEL 4.25% 5/15/2009 68.57 CLEAR CHANNEL 4.4% 5/15/2011 9.25 CLEAR CHANNEL 4.5% 1/15/2010 28.00 CLEAR CHANNEL 4.9% 5/15/2015 7.50 CLEAR CHANNEL 5% 3/15/2012 8.50 CLEAR CHANNEL 5.5% 9/15/2014 7.60 CLEAR CHANNEL 5.5% 12/15/2016 13.40 CLEAR CHANNEL 5.75% 1/15/2013 8.81 CLEAR CHANNEL 6.25% 3/15/2011 12.00 CLEAR CHANNEL 6.875% 6/15/2018 9.00 CLEAR CHANNEL 7.25% 10/15/2027 6.75 CLEAR CHANNEL 7.65% 9/15/2010 64.00 CLEAR CHANNEL 10.75% 8/1/2016 15.13 CMP SUSQUEHANNA 9.875% 5/15/2014 2.00 COEUR D'ALENE 1.25% 1/15/2024 50.50 COLLEGIATE PAC 5.75% 12/1/2009 80.50 COLONIAL BANK 8% 3/15/2009 92.00 COMPUCREDIT 3.625% 5/30/2025 23.83 CONEXANT SYSTEMS 4% 3/1/2026 43.03 CONSTAR INTL 11% 12/1/2012 1.50 COOPER-STANDARD 7% 12/15/2012 12.00 COOPER-STANDARD 8.375% 12/15/2014 12.00 CREDENCE SYSTEM 3.5% 5/15/2010 25.00 DAYTON SUPERIOR 13% 6/15/2009 59.50 DECODE GENETICS 3.5% 4/15/2011 4.38 DECODE GENETICS 3.5% 4/15/2011 5.00 DELPHI CORP 6.5% 8/15/2013 1.00 DELPHI CORP 8.25% 10/15/2033 0.50 DEVELOPERS DIVER 3.5% 8/15/2011 46.75 DEX MEDIA INC 8% 11/15/2013 8.00 DEX MEDIA WEST 5.875% 11/15/2011 31.63 DEX MEDIA WEST 8.5% 8/15/2010 41.00 DEX MEDIA WEST 8.5% 8/15/2010 48.00 DEX MEDIA WEST 9.875% 8/15/2013 16.00 DOLE FOODS CO 8.625% 5/1/2009 100.00 DRIVETIME AUTO 11.25% 7/1/2013 45.00 DUANE READE INC 9.75% 8/1/2011 56.45 DUNE ENERGY INC 10.5% 6/1/2012 29.38 E*TRADE FINL 8% 6/15/2011 39.75 ENERGY PARTNERS 9.75% 4/15/2014 29.75 ENERGY XXI GULF 10% 6/15/2013 39.25 EOP OPERATING LP 7% 7/15/2011 38.93 EPIX MEDICAL INC 3% 6/15/2024 32.50 EVERGREEN SOLAR 4% 7/15/2013 24.25 FGIC CORP 6% 1/15/2034 10.50 FIBERTOWER CORP 9% 11/15/2012 28.88 FINISAR CORP 2.5% 10/15/2010 52.38 FINLAY FINE JWLY 8.375% 6/1/2012 6.46 FIRST DATA CORP 4.5% 6/15/2010 55.00 FIRST DATA CORP 4.7% 8/1/2013 25.12 FIRST DATA CORP 5.625% 11/1/2011 57.95 FLOTEK INDS 5.25% 2/15/2028 27.50 FONTAINEBLEAU LA 11% 6/15/2015 6.13 FORD HOLDINGS 9.3% 3/1/2030 22.00 FORD HOLDINGS 9.375% 3/1/2020 19.75 FORD MOTOR CO 6.375% 2/1/2029 16.13 FORD MOTOR CO 6.5% 8/1/2018 18.78 FORD MOTOR CO 6.625% 2/15/2028 14.00 FORD MOTOR CO 6.625% 10/1/2028 17.40 FORD MOTOR CO 7.125% 11/15/2025 14.21 FORD MOTOR CO 7.4% 11/1/2046 18.75 FORD MOTOR CO 7.45% 7/16/2031 18.05 FORD MOTOR CO 7.5% 8/1/2026 15.84 FORD MOTOR CO 7.7% 5/15/2097 16.00 FORD MOTOR CO 7.75% 6/15/2043 15.50 FORD MOTOR CO 8.875% 1/15/2022 17.25 FORD MOTOR CO 8.9% 1/15/2032 19.25 FORD MOTOR CO 9.215% 9/15/2021 20.00 FORD MOTOR CO 9.5% 9/15/2011 36.50 FORD MOTOR CO 9.95% 2/15/2032 16.00 FORD MOTOR CO 9.98% 2/15/2047 23.00 FORD MOTOR CRED 4.5% 3/20/2009 92.00 FORD MOTOR CRED 4.7% 4/20/2009 94.00 FORD MOTOR CRED 4.9% 5/20/2009 93.22 FORD MOTOR CRED 4.9% 9/21/2009 76.01 FORD MOTOR CRED 4.9% 10/20/2009 81.50 FORD MOTOR CRED 5% 8/20/2009 86.00 FORD MOTOR CRED 5% 9/21/2009 84.00 FORD MOTOR CRED 5% 9/21/2009 84.05 FORD MOTOR CRED 5% 10/20/2009 71.69 FORD MOTOR CRED 5% 1/20/2011 50.53 FORD MOTOR CRED 5% 2/22/2011 35.00 FORD MOTOR CRED 5.1% 8/20/2009 85.25 FORD MOTOR CRED 5.1% 11/20/2009 76.00 FORD MOTOR CRED 5.1% 2/22/2011 35.00 FORD MOTOR CRED 5.15% 11/20/2009 67.64 FORD MOTOR CRED 5.15% 11/20/2009 72.13 FORD MOTOR CRED 5.15% 1/20/2011 50.11 FORD MOTOR CRED 5.2% 3/21/2011 34.66 FORD MOTOR CRED 5.2% 3/21/2011 40.91 FORD MOTOR CRED 5.25% 1/20/2010 71.84 FORD MOTOR CRED 5.25% 2/22/2011 42.90 FORD MOTOR CRED 5.25% 3/21/2011 40.83 FORD MOTOR CRED 5.25% 3/21/2011 36.73 FORD MOTOR CRED 5.3% 3/21/2011 48.88 FORD MOTOR CRED 5.3% 4/20/2011 34.00 FORD MOTOR CRED 5.35% 5/20/2009 86.90 FORD MOTOR CRED 5.35% 2/22/2011 45.00 FORD MOTOR CRED 5.4% 6/22/2009 90.33 FORD MOTOR CRED 5.4% 12/21/2009 66.50 FORD MOTOR CRED 5.4% 1/20/2011 51.13 FORD MOTOR CRED 5.4% 9/20/2011 31.17 FORD MOTOR CRED 5.4% 10/20/2011 41.00 FORD MOTOR CRED 5.45% 4/20/2011 47.43 FORD MOTOR CRED 5.45% 10/20/2011 34.50 FORD MOTOR CRED 5.5% 1/20/2010 67.50 FORD MOTOR CRED 5.5% 2/22/2010 71.00 FORD MOTOR CRED 5.5% 2/22/2010 73.00 FORD MOTOR CRED 5.5% 2/22/2010 63.00 FORD MOTOR CRED 5.5% 4/20/2011 53.00 FORD MOTOR CRED 5.5% 9/20/2011 37.00 FORD MOTOR CRED 5.55% 6/21/2010 61.29 FORD MOTOR CRED 5.55% 8/22/2011 42.00 FORD MOTOR CRED 5.55% 9/20/2011 41.00 FORD MOTOR CRED 5.6% 4/20/2011 33.00 FORD MOTOR CRED 5.6% 8/22/2011 30.63 FORD MOTOR CRED 5.6% 9/20/2011 31.59 FORD MOTOR CRED 5.6% 11/21/2011 44.00 FORD MOTOR CRED 5.6% 11/21/2011 40.00 FORD MOTOR CRED 5.65% 12/20/2010 48.50 FORD MOTOR CRED 5.65% 7/20/2011 33.00 FORD MOTOR CRED 5.65% 11/21/2011 30.89 FORD MOTOR CRED 5.65% 12/20/2011 44.00 FORD MOTOR CRED 5.7% 1/15/2010 74.00 FORD MOTOR CRED 5.7% 3/22/2010 62.35 FORD MOTOR CRED 5.7% 5/20/2011 47.45 FORD MOTOR CRED 5.7% 12/20/2011 45.50 FORD MOTOR CRED 5.75% 1/20/2010 66.14 FORD MOTOR CRED 5.75% 3/22/2010 70.00 FORD MOTOR CRED 5.75% 6/21/2010 67.75 FORD MOTOR CRED 5.75% 10/20/2010 49.83 FORD MOTOR CRED 5.75% 12/20/2011 35.94 FORD MOTOR CRED 5.75% 2/20/2014 24.00 FORD MOTOR CRED 5.8% 11/22/2010 51.82 FORD MOTOR CRED 5.8% 8/22/2011 49.02 FORD MOTOR CRED 5.85% 5/20/2010 52.15 FORD MOTOR CRED 5.85% 6/21/2010 51.59 FORD MOTOR CRED 5.85% 7/20/2010 58.20 FORD MOTOR CRED 5.85% 1/20/2012 40.59 FORD MOTOR CRED 5.9% 7/20/2011 42.00 FORD MOTOR CRED 5.95% 5/20/2010 60.08 FORD MOTOR CRED 6% 2/22/2010 58.74 FORD MOTOR CRED 6% 6/21/2010 50.00 FORD MOTOR CRED 6% 10/20/2010 46.41 FORD MOTOR CRED 6% 10/20/2010 48.50 FORD MOTOR CRED 6% 1/20/2012 43.00 FORD MOTOR CRED 6% 1/21/2014 26.00 FORD MOTOR CRED 6% 3/20/2014 29.00 FORD MOTOR CRED 6% 3/20/2014 29.00 FORD MOTOR CRED 6% 3/20/2014 29.75 FORD MOTOR CRED 6% 3/20/2014 24.50 FORD MOTOR CRED 6% 11/20/2014 21.90 FORD MOTOR CRED 6.05% 7/20/2010 58.00 FORD MOTOR CRED 6.05% 9/20/2010 47.28 FORD MOTOR CRED 6.05% 6/20/2011 42.90 FORD MOTOR CRED 6.05% 4/21/2014 23.85 FORD MOTOR CRED 6.05% 12/22/2014 20.71 FORD MOTOR CRED 6.1% 6/20/2011 32.00 FORD MOTOR CRED 6.15% 7/20/2010 48.91 FORD MOTOR CRED 6.15% 9/20/2010 62.00 FORD MOTOR CRED 6.15% 5/20/2011 32.00 FORD MOTOR CRED 6.2% 5/20/2011 38.69 FORD MOTOR CRED 6.2% 6/20/2011 48.00 FORD MOTOR CRED 6.2% 4/21/2014 26.00 FORD MOTOR CRED 6.25% 6/20/2011 33.50 FORD MOTOR CRED 6.25% 6/20/2011 33.51 FORD MOTOR CRED 6.25% 12/20/2013 26.00 FORD MOTOR CRED 6.25% 4/21/2014 30.00 FORD MOTOR CRED 6.25% 1/20/2015 23.25 FORD MOTOR CRED 6.3% 5/20/2010 68.25 FORD MOTOR CRED 6.3% 5/20/2014 27.50 FORD MOTOR CRED 6.35% 9/20/2010 56.00 FORD MOTOR CRED 6.35% 9/20/2010 53.80 FORD MOTOR CRED 6.35% 4/21/2014 26.00 FORD MOTOR CRED 6.5% 8/20/2010 48.50 FORD MOTOR CRED 6.5% 12/20/2013 32.18 FORD MOTOR CRED 6.5% 2/20/2015 22.49 FORD MOTOR CRED 6.55% 8/20/2010 51.19 FORD MOTOR CRED 6.65% 10/21/2013 26.99 FORD MOTOR CRED 6.65% 6/20/2014 21.81 FORD MOTOR CRED 6.75% 10/21/2013 32.00 FORD MOTOR CRED 6.75% 6/20/2014 22.75 FORD MOTOR CRED 6.8% 6/20/2014 24.00 FORD MOTOR CRED 6.8% 6/20/2014 30.00 FORD MOTOR CRED 6.85% 9/20/2013 29.12 FORD MOTOR CRED 6.85% 5/20/2014 30.00 FORD MOTOR CRED 6.85% 6/20/2014 30.00 FORD MOTOR CRED 6.95% 4/20/2010 53.03 FORD MOTOR CRED 6.95% 5/20/2014 29.00 FORD MOTOR CRED 7% 8/15/2012 31.00 FORD MOTOR CRED 7.05% 9/20/2013 33.86 FORD MOTOR CRED 7.1% 9/20/2013 23.30 FORD MOTOR CRED 7.1% 9/20/2013 22.18 FORD MOTOR CRED 7.25% 3/22/2010 61.07 FORD MOTOR CRED 7.35% 3/20/2015 25.75 FORD MOTOR CRED 7.375% 10/28/2009 80.50 FORD MOTOR CRED 7.375% 2/1/2011 60.75 FORD MOTOR CRED 7.5% 4/25/2011 43.00 FORD MOTOR CRED 7.5% 8/20/2032 18.50 FORD MOTOR CRED 7.875% 6/15/2010 65.40 FORD MOTOR CRED 8.625% 11/1/2010 64.00 FORD MOTOR CRED 9.75% 9/15/2010 69.00 FORD MOTOR CRED 9.875% 8/10/2011 59.38 FOX ACQUISITION 13.375% 7/15/2016 32.75 FRANKLIN BANK 4% 5/1/2027 1.38 FREESCALE SEMICO 8.875% 12/15/2014 18.00 FREESCALE SEMICO 8.875% 12/15/2014 29.75 FREESCALE SEMICO 10.125% 12/15/2016 28.25 FREESCALE SEMICO 10.125% 12/15/2016 15.00 FRONTIER AIRLINE 5% 12/15/2025 17.50 G-I HOLDINGS 10% 2/15/2006 1.60 GENCORP INC 2.25% 11/15/2024 42.00 GENCORP INC 4% 1/16/2024 67.50 GENERAL MOTORS 6.75% 5/1/2028 12.50 GENERAL MOTORS 7.125% 7/15/2013 16.88 GENERAL MOTORS 7.2% 1/15/2011 17.00 GENERAL MOTORS 7.375% 5/23/2048 14.84 GENERAL MOTORS 7.4% 9/1/2025 13.00 GENERAL MOTORS 7.7% 4/15/2016 14.00 GENERAL MOTORS 8.1% 6/15/2024 13.55 GENERAL MOTORS 8.25% 7/15/2023 14.96 GENERAL MOTORS 8.375% 7/15/2033 14.00 GENERAL MOTORS 8.8% 3/1/2021 13.25 GENERAL MOTORS 9.4% 7/15/2021 14.00 GENERAL MOTORS 9.45% 11/1/2011 16.77 GEORGIA GULF CRP 7.125% 12/15/2013 33.00 GEORGIA GULF CRP 9.5% 10/15/2014 20.00 GEORGIA GULF CRP 10.75% 10/15/2016 3.13 GGP LP 3.98% 4/15/2027 8.85 GMAC LLC 4.15% 4/15/2009 94.00 GMAC LLC 4.25% 3/15/2009 91.00 GMAC LLC 4.9% 10/15/2009 77.59 GMAC LLC 4.9% 10/15/2009 66.70 GMAC LLC 4.95% 10/15/2009 65.00 GMAC LLC 5% 8/15/2009 68.31 GMAC LLC 5% 8/15/2009 72.00 GMAC LLC 5% 9/15/2009 71.00 GMAC LLC 5% 9/15/2009 66.50 GMAC LLC 5% 9/15/2009 72.00 GMAC LLC 5% 10/15/2009 71.00 GMAC LLC 5.1% 7/15/2009 72.00 GMAC LLC 5.1% 8/15/2009 69.15 GMAC LLC 5.1% 9/15/2009 69.51 GMAC LLC 5.2% 11/15/2009 65.00 GMAC LLC 5.2% 11/15/2009 65.10 GMAC LLC 5.25% 7/15/2009 72.00 GMAC LLC 5.25% 7/15/2009 76.05 GMAC LLC 5.25% 8/15/2009 69.00 GMAC LLC 5.25% 8/15/2009 71.00 GMAC LLC 5.25% 11/15/2009 64.42 GMAC LLC 5.25% 11/15/2009 63.46 GMAC LLC 5.25% 1/15/2014 21.43 GMAC LLC 5.3% 1/15/2010 63.80 GMAC LLC 5.35% 11/15/2009 63.68 GMAC LLC 5.35% 12/15/2009 61.69 GMAC LLC 5.35% 12/15/2009 68.25 GMAC LLC 5.35% 1/15/2014 26.10 GMAC LLC 5.4% 12/15/2009 62.50 GMAC LLC 5.4% 12/15/2009 68.50 GMAC LLC 5.5% 6/15/2009 83.00 GMAC LLC 5.5% 1/15/2010 66.00 GMAC LLC 5.625% 5/15/2009 90.50 GMAC LLC 5.75% 1/15/2010 57.18 GMAC LLC 5.85% 2/15/2010 56.85 GMAC LLC 5.85% 6/15/2013 26.27 GMAC LLC 5.9% 12/15/2013 24.50 GMAC LLC 6% 1/15/2010 67.00 GMAC LLC 6% 2/15/2010 57.99 GMAC LLC 6% 2/15/2010 63.50 GMAC LLC 6% 4/1/2011 51.55 GMAC LLC 6% 11/15/2013 22.57 GMAC LLC 6.05% 3/15/2010 52.81 GMAC LLC 6.05% 8/15/2019 19.86 GMAC LLC 6.1% 4/15/2009 93.50 GMAC LLC 6.1% 11/15/2013 37.39 GMAC LLC 6.15% 3/15/2010 53.28 GMAC LLC 6.15% 9/15/2013 28.00 GMAC LLC 6.15% 11/15/2013 30.50 GMAC LLC 6.15% 12/15/2013 27.05 GMAC LLC 6.15% 10/15/2019 23.00 GMAC LLC 6.25% 3/15/2013 32.75 GMAC LLC 6.25% 7/15/2013 28.28 GMAC LLC 6.25% 10/15/2013 29.69 GMAC LLC 6.25% 7/15/2019 21.63 GMAC LLC 6.3% 3/15/2013 26.85 GMAC LLC 6.3% 10/15/2013 23.35 GMAC LLC 6.3% 11/15/2013 29.48 GMAC LLC 6.3% 8/15/2019 21.00 GMAC LLC 6.3% 8/15/2019 21.10 GMAC LLC 6.35% 5/15/2013 26.86 GMAC LLC 6.35% 4/15/2019 18.00 GMAC LLC 6.35% 7/15/2019 15.60 GMAC LLC 6.35% 7/15/2019 22.01 GMAC LLC 6.375% 6/15/2010 67.50 GMAC LLC 6.375% 1/15/2014 23.27 GMAC LLC 6.4% 3/15/2013 33.00 GMAC LLC 6.45% 2/15/2013 28.28 GMAC LLC 6.5% 6/15/2009 71.65 GMAC LLC 6.5% 10/15/2009 69.00 GMAC LLC 6.5% 3/15/2010 58.20 GMAC LLC 6.5% 5/15/2012 42.75 GMAC LLC 6.5% 7/15/2012 28.00 GMAC LLC 6.5% 2/15/2013 32.00 GMAC LLC 6.5% 3/15/2013 26.00 GMAC LLC 6.5% 4/15/2013 36.75 GMAC LLC 6.5% 5/15/2013 27.50 GMAC LLC 6.5% 6/15/2013 34.29 GMAC LLC 6.5% 8/15/2013 26.71 GMAC LLC 6.5% 11/15/2013 25.42 GMAC LLC 6.6% 5/15/2018 20.00 GMAC LLC 6.6% 6/15/2019 25.24 GMAC LLC 6.625% 10/15/2011 37.31 GMAC LLC 6.65% 2/15/2013 33.25 GMAC LLC 6.7% 7/15/2009 71.90 GMAC LLC 6.7% 5/15/2014 24.61 GMAC LLC 6.7% 5/15/2014 21.61 GMAC LLC 6.7% 6/15/2014 26.91 GMAC LLC 6.7% 8/15/2016 22.50 GMAC LLC 6.7% 6/15/2018 18.89 GMAC LLC 6.7% 6/15/2018 18.89 GMAC LLC 6.75% 9/15/2011 36.08 GMAC LLC 6.75% 10/15/2011 30.31 GMAC LLC 6.75% 10/15/2011 32.25 GMAC LLC 6.75% 7/15/2012 28.00 GMAC LLC 6.75% 9/15/2012 28.00 GMAC LLC 6.75% 9/15/2012 27.80 GMAC LLC 6.75% 10/15/2012 24.00 GMAC LLC 6.75% 4/15/2013 32.00 GMAC LLC 6.75% 6/15/2014 28.58 GMAC LLC 6.75% 5/15/2019 20.00 GMAC LLC 6.75% 6/15/2019 19.80 GMAC LLC 6.75% 6/15/2019 28.83 GMAC LLC 6.8% 7/15/2009 66.88 GMAC LLC 6.8% 11/15/2009 63.71 GMAC LLC 6.8% 12/15/2009 65.00 GMAC LLC 6.8% 2/15/2013 36.00 GMAC LLC 6.8% 4/15/2013 24.00 GMAC LLC 6.85% 7/15/2009 86.67 GMAC LLC 6.85% 10/15/2009 67.00 GMAC LLC 6.85% 5/15/2018 19.88 GMAC LLC 6.875% 10/15/2012 37.15 GMAC LLC 6.875% 4/15/2013 25.00 GMAC LLC 6.875% 8/15/2016 21.62 GMAC LLC 6.875% 7/15/2018 20.12 GMAC LLC 6.9% 6/15/2009 80.50 GMAC LLC 6.9% 7/15/2018 18.00 GMAC LLC 6.95% 8/15/2009 88.00 GMAC LLC 7% 7/15/2009 66.88 GMAC LLC 7% 8/15/2009 70.50 GMAC LLC 7% 9/15/2009 70.30 GMAC LLC 7% 9/15/2009 71.50 GMAC LLC 7% 10/15/2009 64.00 GMAC LLC 7% 10/15/2009 67.58 GMAC LLC 7% 11/15/2009 66.58 GMAC LLC 7% 12/15/2009 64.00 GMAC LLC 7% 12/15/2009 63.11 GMAC LLC 7% 3/15/2010 63.50 GMAC LLC 7% 10/15/2011 41.25 GMAC LLC 7% 9/15/2012 29.00 GMAC LLC 7% 10/15/2012 35.00 GMAC LLC 7% 11/15/2012 30.00 GMAC LLC 7% 12/15/2012 32.98 GMAC LLC 7% 1/15/2013 27.00 GMAC LLC 7% 2/15/2018 20.00 GMAC LLC 7% 3/15/2018 18.51 GMAC LLC 7% 8/15/2018 15.64 GMAC LLC 7.05% 10/15/2009 64.51 GMAC LLC 7.05% 3/15/2018 20.64 GMAC LLC 7.05% 3/15/2018 20.00 GMAC LLC 7.05% 4/15/2018 20.00 GMAC LLC 7.1% 9/15/2012 28.66 GMAC LLC 7.1% 1/15/2013 26.50 GMAC LLC 7.1% 1/15/2013 29.00 GMAC LLC 7.125% 8/15/2009 70.08 GMAC LLC 7.125% 8/15/2012 26.29 GMAC LLC 7.125% 12/15/2012 43.50 GMAC LLC 7.125% 10/15/2017 19.75 GMAC LLC 7.15% 8/15/2009 70.50 GMAC LLC 7.2% 8/15/2009 81.95 GMAC LLC 7.2% 10/15/2017 21.50 GMAC LLC 7.25% 11/15/2009 69.00 GMAC LLC 7.25% 1/15/2010 66.87 GMAC LLC 7.25% 8/15/2012 28.00 GMAC LLC 7.25% 12/15/2012 27.99 GMAC LLC 7.25% 12/15/2012 31.00 GMAC LLC 7.25% 9/15/2017 22.50 GMAC LLC 7.25% 1/15/2018 18.00 GMAC LLC 7.25% 4/15/2018 19.77 GMAC LLC 7.25% 8/15/2018 18.82 GMAC LLC 7.3% 12/15/2017 20.43 GMAC LLC 7.3% 1/15/2018 19.00 GMAC LLC 7.35% 4/15/2018 18.84 GMAC LLC 7.375% 11/15/2016 22.17 GMAC LLC 7.375% 4/15/2018 21.00 GMAC LLC 7.4% 12/15/2017 19.80 GMAC LLC 7.5% 10/15/2012 28.95 GMAC LLC 7.5% 11/15/2017 20.00 GMAC LLC 7.55% 8/15/2010 53.00 GMAC LLC 7.625% 11/15/2012 30.09 GMAC LLC 7.7% 8/15/2010 66.00 GMAC LLC 7.75% 10/15/2012 28.00 GMAC LLC 7.85% 8/15/2010 66.79 GMAC LLC 7.875% 11/15/2012 27.39 GMAC LLC 8% 6/15/2010 65.00 GMAC LLC 8% 6/15/2010 65.00 GMAC LLC 8% 6/15/2010 60.50 GMAC LLC 8% 7/15/2010 62.00 GMAC LLC 8% 7/15/2010 67.79 GMAC LLC 8% 9/15/2010 30.00 GMAC LLC 8% 9/15/2010 58.75 GMAC LLC 8% 8/15/2015 16.00 GMAC LLC 8.05% 4/15/2010 52.00 GMAC LLC 8.125% 9/15/2009 86.23 GMAC LLC 8.2% 7/15/2010 62.00 GMAC LLC 8.25% 9/15/2012 20.27 GMAC LLC 8.4% 4/15/2010 66.68 GMAC LLC 8.4% 8/15/2015 25.10 GMAC LLC 8.5% 5/15/2010 54.14 GMAC LLC 8.5% 10/15/2010 64.02 GMAC LLC 8.5% 10/15/2010 48.50 GMAC LLC 8.5% 8/15/2015 28.81 GMAC LLC 8.65% 8/15/2015 25.01 GMAC LLC 8.875% 6/1/2010 78.00 GMAC LLC 9% 7/15/2015 28.75 GREAT LAKES CHEM 7% 7/15/2009 68.00 HAIGHTS CROSS OP 11.75% 8/15/2011 38.63 HANNA (MA) CO 6.52% 2/23/2010 60.00 HARRAHS OPER CO 5.375% 12/15/2013 9.00 HARRAHS OPER CO 5.5% 7/1/2010 24.78 HARRAHS OPER CO 5.625% 6/1/2015 6.25 HARRAHS OPER CO 5.75% 10/1/2017 6.00 HARRAHS OPER CO 6.5% 6/1/2016 5.00 HARRAHS OPER CO 8% 2/1/2011 23.83 HARRAHS OPER CO 10% 12/15/2015 26.13 HARRAHS OPER CO 10% 12/15/2018 27.09 HARRAHS OPER CO 10.75% 2/1/2016 14.88 HARRAHS OPER CO 10.75% 2/1/2016 13.13 HARRAHS OPER CO 10.75% 2/1/2018 7.50 HARRY & DAVID OP 9% 3/1/2013 15.75 HAWAIIAN TELCOM 9.75% 5/1/2013 5.75 HAWAIIAN TELCOM 12.5% 5/1/2015 1.50 HAWKER BEECHCRAF 8.5% 4/1/2015 19.50 HAWKER BEECHCRAF 9.75% 4/1/2017 12.50 HEADWATERS INC 2.875% 6/1/2016 26.63 HERTZ CORP 6.35% 6/15/2010 86.00 HERTZ CORP 7.4% 3/1/2011 41.00 HERTZ CORP 7.625% 6/1/2012 50.00 HEXION US/NOVA 9.75% 11/15/2014 15.75 HILTON HOTELS 7.2% 12/15/2009 84.00 HILTON HOTELS 7.5% 12/15/2017 11.50 HILTON HOTELS 8.25% 2/15/2011 14.38 HINES NURSERIES 10.25% 10/1/2011 14.50 HOECHST C-TENDER 7.125% 3/15/2009 99.00 HUTCHINSON TECH 3.25% 1/15/2026 25.75 IDEARC INC 8% 11/15/2016 2.09 IDEARC INC 8% 11/15/2016 5.75 INCYTE CORP 3.5% 2/15/2011 49.50 INCYTE CORP LTD 3.5% 2/15/2011 54.50 INDIANAPOLIS DOW 11% 11/1/2012 47.63 INN OF THE MOUNT 12% 11/15/2010 9.00 INTCOMEX INC 11.75% 1/15/2011 33.00 INTL LEASE FIN 3.5% 4/1/2009 95.00 INTL LEASE FIN 4.75% 7/1/2009 86.00 INTL LEASE FIN 6.375% 3/15/2009 97.50 ISTAR FINANCIAL 5.125% 4/1/2011 39.00 ISTAR FINANCIAL 5.125% 4/1/2011 39.75 ISTAR FINANCIAL 5.15% 3/1/2012 36.50 ISTAR FINANCIAL 5.375% 4/15/2010 50.00 ISTAR FINANCIAL 5.5% 6/15/2012 36.00 ISTAR FINANCIAL 5.65% 9/15/2011 41.12 ISTAR FINANCIAL 5.8% 3/15/2011 41.00 ISTAR FINANCIAL 5.95% 10/15/2013 31.94 ISTAR FINANCIAL 6% 12/15/2010 56.25 ISTAR FINANCIAL 8.625% 6/1/2013 33.00 JAZZ TECHNOLOGIE 8% 12/31/2011 22.25 JEFFERSON SMURFI 7.5% 6/1/2013 8.88 JEFFERSON SMURFI 8.25% 10/1/2012 7.00 K HOVNANIAN ENTR 6.5% 1/15/2014 29.00 K HOVNANIAN ENTR 7.75% 5/15/2013 26.00 K HOVNANIAN ENTR 8% 4/1/2012 36.88 K HOVNANIAN ENTR 8.875% 4/1/2012 33.50 KAISER ALUMINUM 12.75% 2/1/2003 4.00 KELLWOOD CO 7.625% 10/15/2017 5.00 KELLWOOD CO 7.875% 7/15/2009 45.00 KEMET CORP 2.25% 11/15/2026 14.50 KEYSTONE AUTO OP 9.75% 11/1/2013 29.00 KIMBALL HILL INC 10.5% 12/15/2012 0.25 KKR FINANCIAL 7% 7/15/2012 38.25 KNIGHT RIDDER 4.625% 11/1/2014 14.00 KNIGHT RIDDER 5.75% 9/1/2017 17.00 KNIGHT RIDDER 6.875% 3/15/2029 17.13 KNIGHT RIDDER 7.125% 6/1/2011 28.13 KNIGHT RIDDER 7.15% 11/1/2027 14.25 KNIGHT RIDDER 9.875% 4/15/2009 90.00 KRATON POLYMERS 8.125% 1/15/2014 25.00 LANDAMERICA 3.125% 11/15/2033 10.00 LANDAMERICA 3.25% 5/15/2034 14.50 LANDRY'S RESTAUR 9.5% 12/15/2014 97.18 LAZYDAYS RV 11.75% 5/15/2012 10.00 LAZYDAYS RV 11.75% 5/15/2012 32.00 LEAR CORP 5.75% 8/1/2014 22.54 LEAR CORP 8.5% 12/1/2013 25.00 LEAR CORP 8.75% 12/1/2016 16.81 LEAR CORP 8.75% 12/1/2016 22.00 LECROY CORP 4% 10/15/2026 35.25 LEHMAN BROS HLDG 1.5% 3/23/2012 9.50 LEHMAN BROS HLDG 3.95% 11/10/2009 12.25 LEHMAN BROS HLDG 4% 4/16/2019 7.50 LEHMAN BROS HLDG 4.25% 1/27/2010 12.00 LEHMAN BROS HLDG 4.375% 11/30/2010 12.03 LEHMAN BROS HLDG 4.5% 7/26/2010 12.00 LEHMAN BROS HLDG 4.5% 8/3/2011 5.00 LEHMAN BROS HLDG 4.7% 3/6/2013 8.80 LEHMAN BROS HLDG 4.8% 2/27/2013 5.50 LEHMAN BROS HLDG 4.8% 3/13/2014 11.80 LEHMAN BROS HLDG 4.8% 6/24/2023 7.50 LEHMAN BROS HLDG 5% 1/14/2011 10.90 LEHMAN BROS HLDG 5% 1/22/2013 5.06 LEHMAN BROS HLDG 5% 2/11/2013 4.00 LEHMAN BROS HLDG 5% 3/27/2013 6.12 LEHMAN BROS HLDG 5% 6/26/2015 4.25 LEHMAN BROS HLDG 5% 8/5/2015 7.50 LEHMAN BROS HLDG 5% 12/18/2015 7.00 LEHMAN BROS HLDG 5% 5/28/2023 7.13 LEHMAN BROS HLDG 5% 5/30/2023 7.50 LEHMAN BROS HLDG 5% 6/10/2023 7.50 LEHMAN BROS HLDG 5% 6/17/2023 7.50 LEHMAN BROS HLDG 5.1% 1/28/2013 7.50 LEHMAN BROS HLDG 5.1% 2/15/2020 7.75 LEHMAN BROS HLDG 5.15% 2/4/2015 10.15 LEHMAN BROS HLDG 5.2% 5/13/2020 4.67 LEHMAN BROS HLDG 5.25% 2/6/2012 12.00 LEHMAN BROS HLDG 5.25% 2/11/2015 7.50 LEHMAN BROS HLDG 5.25% 3/8/2020 6.00 LEHMAN BROS HLDG 5.25% 5/20/2023 7.00 LEHMAN BROS HLDG 5.35% 2/25/2018 8.00 LEHMAN BROS HLDG 5.35% 3/13/2020 4.50 LEHMAN BROS HLDG 5.35% 6/14/2030 1.00 LEHMAN BROS HLDG 5.375% 5/6/2023 3.33 LEHMAN BROS HLDG 5.4% 3/6/2020 7.50 LEHMAN BROS HLDG 5.4% 3/20/2020 8.56 LEHMAN BROS HLDG 5.4% 3/30/2029 7.50 LEHMAN BROS HLDG 5.4% 6/21/2030 8.40 LEHMAN BROS HLDG 5.45% 3/15/2025 3.50 LEHMAN BROS HLDG 5.45% 4/6/2029 8.66 LEHMAN BROS HLDG 5.45% 2/22/2030 8.60 LEHMAN BROS HLDG 5.45% 7/19/2030 7.50 LEHMAN BROS HLDG 5.45% 9/20/2030 5.87 LEHMAN BROS HLDG 5.5% 4/4/2016 11.70 LEHMAN BROS HLDG 5.5% 2/4/2018 7.50 LEHMAN BROS HLDG 5.5% 2/19/2018 12.00 LEHMAN BROS HLDG 5.5% 11/4/2018 8.25 LEHMAN BROS HLDG 5.5% 2/27/2020 7.50 LEHMAN BROS HLDG 5.5% 8/19/2020 7.50 LEHMAN BROS HLDG 5.5% 3/14/2023 7.50 LEHMAN BROS HLDG 5.5% 4/8/2023 7.50 LEHMAN BROS HLDG 5.5% 4/15/2023 7.50 LEHMAN BROS HLDG 5.5% 4/23/2023 9.17 LEHMAN BROS HLDG 5.5% 8/5/2023 7.50 LEHMAN BROS HLDG 5.5% 10/7/2023 5.40 LEHMAN BROS HLDG 5.5% 1/27/2029 4.00 LEHMAN BROS HLDG 5.5% 2/3/2029 2.20 LEHMAN BROS HLDG 5.5% 8/2/2030 5.00 LEHMAN BROS HLDG 5.55% 2/11/2018 8.10 LEHMAN BROS HLDG 5.55% 3/9/2029 4.15 LEHMAN BROS HLDG 5.55% 1/25/2030 7.50 LEHMAN BROS HLDG 5.55% 9/27/2030 7.20 LEHMAN BROS HLDG 5.55% 12/31/2034 7.60 LEHMAN BROS HLDG 5.6% 1/22/2018 6.00 LEHMAN BROS HLDG 5.6% 2/17/2029 4.88 LEHMAN BROS HLDG 5.6% 2/24/2029 7.88 LEHMAN BROS HLDG 5.6% 3/2/2029 7.50 LEHMAN BROS HLDG 5.6% 2/25/2030 7.50 LEHMAN BROS HLDG 5.6% 5/3/2030 9.20 LEHMAN BROS HLDG 5.625% 1/24/2013 13.50 LEHMAN BROS HLDG 5.625% 3/15/2030 7.50 LEHMAN BROS HLDG 5.65% 11/23/2029 8.60 LEHMAN BROS HLDG 5.65% 8/16/2030 7.50 LEHMAN BROS HLDG 5.65% 12/31/2034 7.67 LEHMAN BROS HLDG 5.7% 1/28/2018 7.06 LEHMAN BROS HLDG 5.7% 2/10/2029 5.47 LEHMAN BROS HLDG 5.7% 4/13/2029 8.50 LEHMAN BROS HLDG 5.7% 9/7/2029 7.50 LEHMAN BROS HLDG 5.7% 12/14/2029 1.00 LEHMAN BROS HLDG 5.75% 4/25/2011 12.05 LEHMAN BROS HLDG 5.75% 7/18/2011 11.70 LEHMAN BROS HLDG 5.75% 5/17/2013 11.67 LEHMAN BROS HLDG 5.75% 1/3/2017 0.00 LEHMAN BROS HLDG 5.75% 3/27/2023 9.05 LEHMAN BROS HLDG 5.75% 10/15/2023 7.46 LEHMAN BROS HLDG 5.75% 10/21/2023 5.00 LEHMAN BROS HLDG 5.75% 11/12/2023 4.50 LEHMAN BROS HLDG 5.75% 11/25/2023 6.00 LEHMAN BROS HLDG 5.75% 12/16/2028 8.56 LEHMAN BROS HLDG 5.75% 12/23/2028 6.00 LEHMAN BROS HLDG 5.75% 8/24/2029 8.80 LEHMAN BROS HLDG 5.75% 9/14/2029 7.50 LEHMAN BROS HLDG 5.75% 10/12/2029 3.36 LEHMAN BROS HLDG 5.75% 3/29/2030 8.10 LEHMAN BROS HLDG 5.8% 9/3/2020 9.50 LEHMAN BROS HLDG 5.8% 10/25/2030 7.81 LEHMAN BROS HLDG 5.85% 11/8/2030 9.08 LEHMAN BROS HLDG 5.875% 11/15/2017 11.50 LEHMAN BROS HLDG 5.9% 5/4/2029 7.50 LEHMAN BROS HLDG 5.9% 2/7/2031 2.38 LEHMAN BROS HLDG 5.95% 12/20/2030 11.25 LEHMAN BROS HLDG 6% 7/19/2012 13.44 LEHMAN BROS HLDG 6% 1/22/2020 7.16 LEHMAN BROS HLDG 6% 2/12/2020 3.10 LEHMAN BROS HLDG 6% 1/29/2021 5.00 LEHMAN BROS HLDG 6% 10/23/2028 3.37 LEHMAN BROS HLDG 6% 11/18/2028 7.75 LEHMAN BROS HLDG 6% 5/11/2029 3.80 LEHMAN BROS HLDG 6% 7/20/2029 3.10 LEHMAN BROS HLDG 6% 4/30/2034 3.25 LEHMAN BROS HLDG 6% 7/30/2034 1.40 LEHMAN BROS HLDG 6% 2/21/2036 7.75 LEHMAN BROS HLDG 6% 2/24/2036 4.54 LEHMAN BROS HLDG 6% 2/12/2037 7.50 LEHMAN BROS HLDG 6.05% 6/29/2029 1.12 LEHMAN BROS HLDG 6.1% 8/12/2023 7.50 LEHMAN BROS HLDG 6.15% 4/11/2031 6.00 LEHMAN BROS HLDG 6.2% 9/26/2014 13.00 LEHMAN BROS HLDG 6.2% 6/15/2027 7.50 LEHMAN BROS HLDG 6.2% 5/25/2029 7.75 LEHMAN BROS HLDG 6.25% 2/5/2021 6.00 LEHMAN BROS HLDG 6.25% 2/22/2023 7.00 LEHMAN BROS HLDG 6.3% 3/27/2037 5.00 LEHMAN BROS HLDG 6.4% 10/11/2022 6.50 LEHMAN BROS HLDG 6.4% 12/19/2036 9.75 LEHMAN BROS HLDG 6.5% 2/28/2023 8.00 LEHMAN BROS HLDG 6.5% 3/6/2023 5.00 LEHMAN BROS HLDG 6.5% 10/18/2027 5.98 LEHMAN BROS HLDG 6.5% 10/25/2027 9.60 LEHMAN BROS HLDG 6.5% 1/17/2033 8.04 LEHMAN BROS HLDG 6.5% 12/22/2036 7.50 LEHMAN BROS HLDG 6.5% 2/13/2037 8.20 LEHMAN BROS HLDG 6.5% 6/21/2037 11.00 LEHMAN BROS HLDG 6.5% 7/13/2037 3.00 LEHMAN BROS HLDG 6.6% 10/3/2022 8.01 LEHMAN BROS HLDG 6.625% 1/18/2012 13.50 LEHMAN BROS HLDG 6.625% 7/27/2027 12.50 LEHMAN BROS HLDG 6.75% 7/1/2022 7.50 LEHMAN BROS HLDG 6.75% 11/22/2027 7.35 LEHMAN BROS HLDG 6.75% 3/11/2033 9.61 LEHMAN BROS HLDG 6.75% 10/26/2037 7.10 LEHMAN BROS HLDG 6.8% 9/7/2032 6.38 LEHMAN BROS HLDG 6.85% 8/16/2032 6.75 LEHMAN BROS HLDG 6.85% 8/23/2032 7.25 LEHMAN BROS HLDG 6.875% 5/2/2018 14.38 LEHMAN BROS HLDG 6.875% 7/17/2037 0.12 LEHMAN BROS HLDG 6.9% 9/1/2032 5.00 LEHMAN BROS HLDG 7% 5/12/2023 7.50 LEHMAN BROS HLDG 7% 9/27/2027 13.50 LEHMAN BROS HLDG 7% 10/4/2032 7.88 LEHMAN BROS HLDG 7% 7/27/2037 9.10 LEHMAN BROS HLDG 7% 9/28/2037 4.00 LEHMAN BROS HLDG 7% 11/16/2037 4.35 LEHMAN BROS HLDG 7% 12/28/2037 8.09 LEHMAN BROS HLDG 7% 1/31/2038 7.50 LEHMAN BROS HLDG 7% 2/1/2038 7.75 LEHMAN BROS HLDG 7% 2/7/2038 10.13 LEHMAN BROS HLDG 7% 2/8/2038 4.75 LEHMAN BROS HLDG 7% 4/22/2038 4.60 LEHMAN BROS HLDG 7.05% 2/27/2038 9.00 LEHMAN BROS HLDG 7.1% 3/25/2038 4.00 LEHMAN BROS HLDG 7.25% 2/27/2038 11.00 LEHMAN BROS HLDG 7.25% 4/29/2038 4.00 LEHMAN BROS HLDG 7.35% 5/6/2038 5.00 LEHMAN BROS HLDG 7.73% 10/15/2023 9.10 LEHMAN BROS HLDG 7.875% 11/1/2009 12.05 LEHMAN BROS HLDG 7.875% 8/15/2010 12.50 LEHMAN BROS HLDG 8% 3/17/2023 8.63 LEHMAN BROS HLDG 8.05% 1/15/2019 9.10 LEHMAN BROS HLDG 8.5% 8/1/2015 13.00 LEHMAN BROS HLDG 8.75% 12/21/2021 1.12 LEHMAN BROS HLDG 8.75% 2/6/2023 4.00 LEHMAN BROS HLDG 8.8% 3/1/2015 12.00 LEHMAN BROS HLDG 8.92% 2/16/2017 10.00 LEHMAN BROS HLDG 9.5% 12/28/2022 8.00 LEHMAN BROS HLDG 9.5% 1/30/2023 8.50 LEHMAN BROS HLDG 9.5% 2/27/2023 5.00 LEHMAN BROS HLDG 10% 3/13/2023 7.88 LEHMAN BROS HLDG 10.375% 5/24/2024 6.16 LEHMAN BROS HLDG 11% 10/25/2017 5.00 LEHMAN BROS HLDG 11% 6/22/2022 7.55 LEHMAN BROS HLDG 11.5% 9/26/2022 6.60 LEHMAN BROS HLDG 12.12% 9/11/2009 8.63 LEHMAN BROS HLDG 18% 7/14/2023 7.13 LEHMAN BROS INC 7.5% 8/1/2026 1.00 LEINER HEALTH 11% 6/1/2012 0.53 LENNAR CORP 7.625% 3/1/2009 99.25 LITHIA MOTORS 2.875% 5/1/2014 89.50 LOCAL INSIGHT 11% 12/1/2017 22.75 LOEHMANNS CAP 12% 10/1/2011 56.38 LOEHMANNS CAP 13% 10/1/2011 57.63 MAGNA ENTERTAINM 7.25% 12/15/2009 31.50 MAGNA ENTERTAINM 8.55% 6/15/2010 40.13 MAJESTIC STAR 9.5% 10/15/2010 30.00 MAJESTIC STAR 9.75% 1/15/2011 4.50 MANDALAY RESORT 6.5% 7/31/2009 81.69 MANDALAY RESORTS 9.375% 2/15/2010 52.25 MASONITE CORP 11% 4/6/2015 5.25 MEDIANEWS GROUP 6.375% 4/1/2014 4.25 MEDIANEWS GROUP 6.875% 10/1/2013 4.25 MERISANT CO 9.5% 7/15/2013 5.90 MERIX CORP 4% 5/15/2013 24.50 MERRILL LYNCH 12% 3/26/2010 19.38 METALDYNE CORP 11% 6/15/2012 11.29 MGM GRAND INC 6% 10/1/2009 79.25 MGM MIRAGE 6% 10/1/2009 73.44 MGM MIRAGE 8.375% 2/1/2011 32.06 MGM MIRAGE 8.5% 9/15/2010 54.94 MICHAELS STORES 10% 11/1/2014 34.00 MICHAELS STORES 11.375% 11/1/2016 24.63 MICHAELS STORES 11.375% 11/1/2016 22.44 MILLENNIUM AMER 7.625% 11/15/2026 2.00 MOHEGAN TRIBAL 6.375% 7/15/2009 79.25 MOHEGAN TRIBAL 8% 4/1/2012 33.50 MOHEGAN TRIBAL 8.375% 7/1/2011 36.00 MOMENTIVE PERFOR 11.5% 12/1/2016 21.25 MOMENTIVE PERFOR 11.5% 12/1/2016 28.75 MORRIS PUBLISH 7% 8/1/2013 4.94 MRS FIELDS 10% 10/24/2014 25.00 MTR GAMING GROUP 9% 6/1/2012 50.25 MTR GAMING GROUP 9.75% 4/1/2010 74.00 MUZAK LLC 9.875% 3/15/2009 82.00 NATL FINANCIAL 0.75% 2/1/2012 24.50 NCI BLDG SYSTEMS 2.125% 11/15/2024 78.50 NEFF CORP 10% 6/1/2015 20.13 NELNET INC 5.125% 6/1/2010 62.50 NELNET INC 7.4% 9/29/2036 14.50 NETWORK COMMUNIC 10.75% 12/1/2013 15.00 NEW PAGE CORP 10% 5/1/2012 23.00 NEW PLAN EXCEL 7.4% 9/15/2009 80.26 NEW PLAN REALTY 6.9% 2/15/2028 14.00 NEW PLAN REALTY 6.9% 2/15/2028 10.33 NEW PLAN REALTY 7.65% 11/2/2026 12.00 NEW PLAN REALTY 7.97% 8/14/2026 17.00 NEWARK GROUP INC 9.75% 3/15/2014 15.00 NEWPAGE CORP 10% 5/1/2012 30.25 NEWPAGE CORP 12% 5/1/2013 15.00 NORTEK INC 8.5% 9/1/2014 16.94 NORTEK INC 8.5% 9/1/2014 29.25 NORTEK INC 10% 12/1/2013 40.50 NORTH ATL TRADNG 9.25% 3/1/2012 19.50 NORTHERN TEL CAP 7.875% 6/15/2026 10.00 NTK HOLDINGS INC 0% 3/1/2014 12.00 NUVEEN INVEST 5% 9/15/2010 59.50 NUVEEN INVEST 5.5% 9/15/2015 23.00 NUVEEN INVESTM 10.5% 11/15/2015 23.13 OLD EVANGELINE 13% 3/1/2010 79.13 OSI RESTAURANT 10% 6/15/2015 25.38 OSI RESTAURANT 10% 6/15/2015 24.81 OUTBOARD MARINE 9.125% 4/15/2017 3.00 PALM HARBOR 3.25% 5/15/2024 24.25 PANOLAM INDUSTRI 10.75% 10/1/2013 10.00 PARK PLACE ENT 7% 4/15/2013 29.50 PARK PLACE ENT 7.5% 9/1/2009 60.25 PARK PLACE ENT 7.875% 3/15/2010 28.75 PARK PLACE ENT 8.125% 5/15/2011 18.25 PARK PLACE ENT 8.125% 5/15/2011 16.50 PILGRIMS PRIDE 9.25% 11/15/2013 7.00 PILGRIM'S PRIDE 8.375% 5/1/2017 20.20 PLIANT CORP 11.625% 6/15/2009 40.25 PLY GEM INDS 9% 2/15/2012 25.00 POLYONE CORP 8.875% 5/1/2012 42.25 POPE & TALBOT 8.375% 6/1/2013 0.60 POWERWAVE TECH 1.875% 11/15/2024 21.00 POWERWAVE TECH 3.875% 10/1/2027 18.00 PREGIS CORP 12.375% 10/15/2013 39.50 PRIMUS TELECOM 3.75% 9/15/2010 3.88 PRIMUS TELECOM 8% 1/15/2014 6.75 PRIMUS TELECOM 12.75% 10/15/2009 1.20 PRIMUS TELECOMM 14.25% 5/20/2011 32.19 QUALITY DISTRIBU 9% 11/15/2010 39.00 QUANTUM CORP 4.375% 8/1/2010 44.00 RADIAN GROUP 7.75% 6/1/2011 52.50 RADIAN GROUP 7.75% 6/1/2011 43.06 RADIO ONE INC 6.375% 2/15/2013 24.25 RADIO ONE INC 8.875% 7/1/2011 32.00 RAIT FINANCIAL 6.875% 4/15/2027 30.24 RATHGIBSON INC 11.25% 2/15/2014 21.88 READER'S DIGEST 9% 2/15/2017 8.50 REAL MEX RESTAUR 10% 4/1/2010 75.25 REALOGY CORP 10.5% 4/15/2014 22.50 REALOGY CORP 12.375% 4/15/2015 13.50 RENTECH INC 4% 4/15/2013 19.50 RESIDENTIAL CAP 8% 2/22/2011 35.00 RESIDENTIAL CAP 8.375% 6/30/2010 47.50 RESIDENTIAL CAP 8.5% 6/1/2012 24.85 RESIDENTIAL CAP 8.5% 4/17/2013 30.29 RESIDENTIAL CAP 8.375% 6/30/2010 40.00 RESIDENTIAL CAP 8.5% 5/15/2010 71.61 RESTAURANT CO 10% 10/1/2013 44.50 RH DONNELLEY 6.875% 1/15/2013 3.50 RH DONNELLEY 6.875% 1/15/2013 4.75 RH DONNELLEY 6.875% 1/15/2013 4.00 RH DONNELLEY 8.875% 1/15/2016 5.25 RH DONNELLEY 8.875% 10/15/2017 5.00 RH DONNELLEY 8.875% 10/15/2017 6.50 RH DONNELLEY INC 11.75% 5/15/2015 14.50 RITE AID CORP 6.875% 8/15/2013 22.00 RITE AID CORP 6.875% 12/15/2028 13.63 RITE AID CORP 7.7% 2/15/2027 13.00 RITE AID CORP 8.125% 5/1/2010 58.13 RITE AID CORP 8.5% 5/15/2015 29.00 RITE AID CORP 8.625% 3/1/2015 24.25 RITE AID CORP 9.25% 6/1/2013 12.50 RITE AID CORP 9.375% 12/15/2015 26.19 RITE AID CORP 9.5% 6/15/2017 25.00 RIVER ROCK ENT 9.75% 11/1/2011 51.75 RJ TOWER CORP 12% 6/1/2013 0.75 ROUSE CO LP/TRC 6.75% 5/1/2013 30.84 ROUSE COMPANY 5.375% 11/26/2013 31.00 ROUSE COMPANY 7.2% 9/15/2012 31.75 SABRE HOLDINGS 7.35% 8/1/2011 43.50 SALEM COMM HLDG 7.75% 12/15/2010 50.38 SBARRO INC 10.375% 2/1/2015 35.00 SECURUS TECH 11% 9/1/2011 63.70 SEQUA CORP 11.75% 12/1/2015 15.63 SIMMONS CO 7.875% 1/15/2014 14.00 SINCLAIR BROAD 3% 5/15/2027 60.00 SINCLAIR BROAD 6% 9/15/2012 45.00 SIRIUS SATELLITE 9.625% 8/1/2013 42.75 SIX FLAGS INC 4.5% 5/15/2015 15.25 SIX FLAGS INC 8.875% 2/1/2010 28.00 SIX FLAGS INC 9.625% 6/1/2014 18.50 SIX FLAGS INC 9.75% 4/15/2013 15.00 SMURFIT-STONE 8% 3/15/2017 8.88 SONIC AUTOMOTIVE 5.25% 5/7/2009 75.00 SONIC AUTOMOTIVE 8.625% 8/15/2013 32.25 SPACEHAB INC 5.5% 10/15/2010 51.10 SPECTRUM BRANDS 7.375% 2/1/2015 17.63 SPECTRUM BRANDS 12.5% 10/2/2013 22.50 SPHERIS INC 11% 12/15/2012 31.50 STALLION OILFIEL 9.75% 2/1/2015 11.97 STANDRD PAC CORP 5.125% 4/1/2009 98.81 STANLEY-MARTIN 9.75% 8/15/2015 28.00 STATION CASINOS 6% 4/1/2012 32.50 STATION CASINOS 6.5% 2/1/2014 4.75 STATION CASINOS 6.625% 3/15/2018 5.25 STATION CASINOS 6.875% 3/1/2016 3.00 STONE CONTAINER 8.375% 7/1/2012 8.88 STRATEGIC HOTEL 3.5% 4/1/2012 37.57 SWIFT TRANS CO 12.5% 5/15/2017 10.38 TEKNI-PLEX INC 10.875% 8/15/2012 41.75 TEKNI-PLEX INC 12.75% 6/15/2010 73.50 TENNECO AUTOMOT 8.625% 11/15/2014 14.00 TENNECO INC 8.125% 11/15/2015 17.00 TERPHANE HLDING 12.5% 6/15/2009 85.00 TERPHANE HLDING 12.5% 6/15/2009 85.00 TETON ENERGY COR 10.75% 6/18/2013 36.05 THORNBURG MTG 8% 5/15/2013 17.95 TIMES MIRROR CO 6.61% 9/15/2027 3.00 TIMES MIRROR CO 7.25% 3/1/2013 3.00 TIMES MIRROR CO 7.25% 11/15/2096 4.25 TIMES MIRROR CO 7.5% 7/1/2023 3.00 TOUSA INC 9% 7/1/2010 2.00 TOYS R US 7.625% 8/1/2011 40.00 TOYS R US 7.875% 4/15/2013 34.50 TOYS R US DEL 8.75% 9/1/2021 15.00 TRANS-LUX CORP 8.25% 3/1/2012 35.20 TRANSMERIDIAN EX 12% 12/15/2010 10.00 TRAVELPORT LLC 11.875% 9/1/2016 29.75 TRIBUNE CO 4.875% 8/15/2010 2.50 TRIBUNE CO 5.25% 8/15/2015 3.13 TRIBUNE CO 5.67% 12/8/2008 3.00 TRICO MARINE SER 6.5% 5/15/2028 33.42 TRIMAS CORP 9.875% 6/15/2012 48.50 TRONOX WORLDWIDE 9.5% 12/1/2012 10.50 TRUE TEMPER 8.375% 9/15/2011 37.25 TRUMP ENTERTNMNT 8.5% 6/1/2015 9.00 TRW AUTOMOTIVE 7% 3/15/2014 28.54 UAL CORP 4.5% 6/30/2021 45.69 UAL CORP 5% 2/1/2021 48.25 UNION CARBIDE 6.7% 4/1/2009 99.50 UNISYS CORP 6.875% 3/15/2010 46.97 UNISYS CORP 8% 10/15/2012 25.00 UNISYS CORP 8.5% 10/15/2015 27.50 UNISYS CORP 12.5% 1/15/2016 41.00 UNITED COMPONENT 9.375% 6/15/2013 32.00 UNITED MERCH&MFG 3.5% 3/31/2022 1.00 UNIV CITY DEVEL 11.75% 4/1/2010 77.00 UNIV CITY FL HLD 8.375% 5/1/2010 70.00 UNIVERSAL FOODS 6.5% 4/1/2009 91.50 US AIRWAYS GROUP 7% 9/30/2020 60.06 US CONCRETE INC 8.375% 4/1/2014 43.07 US LEASING INTL 6% 9/6/2011 12.52 US SHIPPING PART 13% 8/15/2014 39.63 USFREIGHTWAYS 8.5% 4/15/2010 55.65 VENOCO INC 8.75% 12/15/2011 51.50 VERASUN ENERGY 9.375% 6/1/2017 3.06 VERENIUM CORP 5.5% 4/1/2027 25.50 VERSO PAPER 11.375% 8/1/2016 22.00 VESTA INSUR GRP 8.75% 7/15/2025 1.00 VICORP RESTAURNT 10.5% 4/15/2011 3.00 VIRGIN RIVER CAS 9% 1/15/2012 36.75 VISTEON CORP 7% 3/10/2014 4.00 VISTEON CORP 8.25% 8/1/2010 8.50 VISTEON CORP 12.25% 12/31/2016 7.99 VITESSE SEMICOND 1.5% 10/1/2024 50.03 WASH MUT BANK NV 5.55% 6/16/2010 21.25 WASH MUT BANK NV 5.95% 5/20/2013 1.00 WASH MUTUAL INC 8.25% 4/1/2010 47.00 WCI COMMUNITIES 4% 8/5/2023 4.98 WCI COMMUNITIES 6.625% 3/15/2015 7.00 WCI COMMUNITIES 7.875% 10/1/2013 3.00 WCI COMMUNITIES 9.125% 5/1/2012 1.00 WILLIAM LYON 7.625% 12/15/2012 21.38 WILLIAM LYONS 7.5% 2/15/2014 19.51 WILLIAM LYONS 7.625% 12/15/2012 18.87 WILLIAM LYONS 10.75% 4/1/2013 16.25 WIMAR OP LLC/FIN 9.625% 12/15/2014 1.76 WOLVERINE TUBE 10.5% 4/1/2009 81.00 XM SATELLITE 9.75% 5/1/2014 29.84 XM SATELLITE 10% 12/1/2009 43.50 XM SATELLITE 10% 12/31/2009 38.00 XM SATELLITE 13% 8/1/2013 45.88 ********* 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. The Sunday TCR delivers securitization rating news from the week then-ending. 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 ***