/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/060814.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, August 14, 2006, Vol. 10, No. 192 Headlines 1945 ROUTE 23: Case Summary & 40 Largest Unsecured Creditors ABLE LABORATORIES: Chapter 11 Plan Effective as of August 9 ACANDS INC: Exclusive Plan-Filing Period Intact Until October 12 ACANDS INC: Has Until November 3 to Remove Civil Actions ACRO BUSINESS: Section 341(a) Meeting Scheduled for September 7 ACRO BUSINESS: Gets Final Approval to Use M&I's Cash Collateral AIRADIGM COMMS: Court OKs Disclosure Statement Over FCC Objection AIRADIGM COMMS: Demands Rothschild Valuation from the FCC ALERIS INTERNATIONAL: Board of Directors Okay Aurora Merger Pact AMERISOURCEBERGEN: Board OKs New $750MM Share Repurchase Program AMERUS GROUP: To Redeem Series A Perpetual Preferred Stock AMKOR TECH: Delayed Form 10-Q Filing Cues S&P's Developing Outlook ANDREW CORPORATION: Rejects CommScope Acquisition Proposal ANDREW CORPORATION: Rejected Bids Prompt S&P's Negative Watch ARCAP 2005-RR5: Fitch Affirms Low-B Ratings on Six Class Certs. ASARCO LLC: Wants to File Employment Application Under Seal ASARCO LLC: Hires RECON Real Estate as Broker for 3 El Paso Land ASSOCIATED BRANDS: Posts $578,000 Net Loss for Period Ended July 1 ATLANTIS PLASTICS: S&P Cuts Ratings and Says Outlook is Negative BANCORP FINANCIAL: Fitch Withdraws Rating on Class C Notes BLEECKER STRUCTURED: S&P Cuts Ratings and Removes Negative Watch BOWNE & CO: Earns $6.5 Million for Quarter Ended June 30 CAL-BAY INT'L: Board to Accelerate Foreign Delisting Program CALLA PROPERTIES: Case Summary & Three Largest Unsecured Creditors CARLTON COVE: Case Summary & 17 Largest Unsecured Creditors CARRINGTON MORTGAGE: Fitch Rates $18.3 Million Certificates at BB+ CHARLES RIVER: Earns $25.7 Million in Period Ended July 1 CHARTERMAC: Earns $4.2 Million in Second Quarter 2006 CHARTERMAC: Centerbrook Financial Closes $175 Mil. Securitization CHASE COMMERCIAL: Fitch Lifts Low-B Ratings on Four Class Certs. CHENIERE ENERGY: Posts $3.6 Million 2006 Second Quarter Net Loss CHESAPEAKE CORP: S&P Rates $125 Million Credit Facility at BB- CINEMARK INC: Moody's Holds Junk Rating on Senior Unsecured Notes CINEMARK USA: Moody's Holds B3 Rating on Senior Subordinated Notes CITIZENS COMMS: Earns $101 Million in Quarter Ended June 30 CMS ENERGY: Moody's Upgrades Corp. Family & Senior Debt Ratings COEUR D'ALENE: Invests $60 Million on San Bartolome Silver Mine COMM 2004-LNB2: Fitch Holds Low-B Ratings on Six Classes COMMSCOPE INC: Backs Out on Proposed Andrew Corp. Acquisition CONSTELLATION BRANDS: Moody's Rates $500 Million Sr. Notes at Ba2 CT CDO: Fitch Affirms Low-B Ratings on Six Class Certificates DA VINCI: Voluntary Chapter 11 Case Summary DELPHI CORP: American Axle CEO Downplays Plan to Buy Delphi Parts DELPHI CORP: Hires 290 Temporary Workers for Lockport Plant DELTA PETROLEUM: S&P Junks Rating on $150 Million Senior Notes DIVERSIFIED REIT: Fitch Holds Low-B Ratings on Three Class Notes DIVERSIFIED REIT: Fitch Lifts Ratings on $13.64 Mil. Class Notes DLJ COMMERCIAL: Fitch Cuts Rating on $9.7 Mil. Certificates to B- DLJ COMMERCIAL: Fitch Holds Low-B Ratings on $20.2 Mil. Certs. DPAC TECHNOLOGIES: Posts $296,000 Net Loss in 2006 Second Quarter EAGLEPICHER HOLDINGS: Court OKs Adequacy of Environmental Trusts EASYLINK SERVICES: Reports $18.9 Mil. in Revenues for Second Qtr. EMCOR GROUP: Earns $16.9 Million in 2006 Second Quarter FRIENDLY ICE CREAM: July 2 Balance Sheet Upside-Down by $139 Mil. G-FORCE: Fitch Holds Low-B Ratings on Six Class Certificates G-FORCE: Fitch Holds Low-B Ratings on $77.4 Mil. Class Certs. GALLERIA INVESTMENTS: Files Disclosure Statement in N.D. Georgia GENELABS TECHNOLOGIES: Posts $4 Mil. Net Loss in 2nd Quarter 2006 GS MORTGAGE: Fitch Holds B Rating on Class G Certificates HEALTHTRONICS INC: Loan Paydown Prompts S&P to Hold BB- Rating HIGHWOODS PROPERTIES: Credit Facility Upsized to $450 Million HOWARD HUH: Case Summary & Largest Unsecured Creditor ICOS CORP: June 30 Balance Sheet Upside-Down by $35.9 Million IMMUNE RESPONSE: Raises $9.9 Mil. from First Tranche of Warrants IMPERIAL PETROLEUM: Closes $13.6MM Asset Sale to Whittier Energy INCO LTD: Gets CDN$86 Per Share All-Cash Buy Offer from CVRD INFORMATION ARCHITECTS: Acquires Xtreme Outdoor Network INFOUSA INC: To Acquire Opinion Research for $134.3 Million INTEGRATED ALARM: Posts $6.4 Mil. Net Loss in 2006 Second Quarter INTELSAT LTD: KPMG Replaces Deloitte as Independent Accountant IPCS INC: Units Obtain Court Victory against Sprint Nextel ITRON INC: Inks Pact with Gaylon to Sell Spokane Valley Facility JAMES RIVER: Poor Performance Prompts S&P to Junk Rating JERNBERG INDUSTRIES: PAC Entitled to Escrowed Insurance Premium MACH ONE: Fitch Ups Rating on $8.8 Mil. Class K Certs. to BB+ MAIN LINE: Case Summary & 11 Largest Unsecured Creditors MARSH SUPERMARKETS: Earns $1.12 Mil. for First Fiscal Quarter 2007 MORGAN STANLEY: Fitch Holds Low-B Ratings on Six Class Certs. MORGAN STANLEY: Fitch Affirms Low-B Ratings on Six Class Certs. NBTY INC: S&P Upgrades Bank Loan Rating to BB+ NEWPARK RESOURCES: Moody's Rates New $150 Million Sr. Loan at B2 NORD RESOURCES: Gets Maturity Extension on $4.9 Mil. Secured Loan NORTHSHORE ASSET: Furniture & Antique Auction Tomorrow, Aug. 15 NORTHWESTERN CORP: Posts $2.4 Mil. Net Loss in 2nd Quarter 2006 NRG ENERGY: Two Subsidiaries Commence $500 Million Stock Purchase ODYSSEY RE HOLDINGS: Earns $202 Million in Quarter Ended June 30 ON SEMICONDUCTOR: Earns $67.5 Million in Second Quarter of 2006 ORION HEALTHCORP: Posts $480,000 Net Loss in 2006 Second Quarter OVERSEAS SHIPHOLDING: Discloses Partnership with TransCanada PARMALAT: Parma Court Approves Boschi's Composition of Creditors PARMALAT: Court Allows Investors to File Third Amended Complaint PAXAR CORP: Earns $14.6 Million in Second Quarter of 2006 PEOPLE'S CHOICE: Fitch Rates $19.06 Million Class Certs. at BB+ PICTURESQUE LLC: Case Summary & 20 Largest Unsecured Creditors PRESCIENT APPLIED: Stockholders Gives Nod on TAK Settlement Pact PROGRESS RAIL: Notes Redemption Prompts S&P to Withdraw Ratings PSS WORLD: Good Performance Prompts S&P to Upgrade Ratings QUANTA CAPITAL: In Talks with Lenders to Amended Credit Facility QUIGLEY COMPANY: Plan Misses 75% 524(g) Acceptance Requirement REFCO INC: Davidson Kempner Offering to Buy Refco Capital Claims RENT-A-CENTER INC: To Acquire Rent-Way for $567 Million RENT-WAY INC: Sells Assets to Rent-A-Center for $567 Million RICHARD INFARINATO: Case Summary & 16 Largest Unsecured Creditors RIGEL CORPORATION: Case Summary & 20 Largest Unsecured Creditors RIVIERA HOLDINGS: IGE Proposal Cues S&P to Hold Developing Watch ROYAL GROUP: Shareholders OKs $1.7 Billion Georgia Gulf Buy Offer SATELITES MEXICANOS: Files for Chapter 11 Protection in New York SATELITES MEXICANOS: Case Summary & 9 Largest Unsecured Creditors SATELITES MEXICANOS: Files Plan and Disclosure Statement in NY SEAGATE TECHNOLOGY: Board Okays $2.5 Billion Stock Repurchase SECURE COMPUTING: Moody's Rates Proposed $110 Mil. Loans at B2 SECURE COMPUTING: S&P Rates Proposed $110 Million Loan at B SENIOR HOUSING: Earns $12.6 Million in Quarter Ended June 30 SFG LP: Case Summary & 40 Largest Unsecured Creditors SMITHFIELD FOODS: S&P Places BB+ Rating on Negative Watch TANGER FACTORY: Unit Prices $130 Mil. Exchangeable Notes Offering TENET HEALTHCARE: Posts $398 Million Net Loss in 2006 Second Qtr. THE PANTRY: Earns $20.3 Million in Third Quarter Ended June 29 THERMADYNE HOLDINGS: Posts $31 Mil. Net Loss in Year Ended Dec. 31 U.S. STEEL: Earns $404 Million in Second Quater of 2006 UTILITY CRAFT: Creditors Meeting Scheduled for August 22 VESTA INSURANCE: First Meeting of Creditors Slated for Sept. 12 VESTA INSURANCE: John Centineo Asks Tex. Dist. Court to Lift Stay WARNACO GROUP: Financial Restatement Prompts S&P's Stable Outlook WEIGHT WATCHERS: Moody's Rates $850 Million Sr. Sec. Loan at Ba1 WENDY'S INT'L: Posts $29 Million Net Loss in 2nd Quarter of 2006 WILLIAMS COMPANIES: Posts $76 Mil. Net Loss in 2nd Quarter 2006 WINN-DIXIE: Wants to Assume 21 Employment-Related Contracts WINN-DIXIE: Wants to Reject 98 Employment-Related Contracts WORLDCLASS PROCESSING: Confirmed Plan Bars Allegations Against CIT * Sheppard Mullin Hires Daniel Yannuzzi as Member * BOND PRICING: For the week of August 7 - August 11, 2006 ********* 1945 ROUTE 23: Case Summary & 40 Largest Unsecured Creditors ------------------------------------------------------------ Lead Debtor: 1945 Route 23 Associates, Inc. 1945 Route 23 Wayne, New Jersey 07470 Bankruptcy Case No.: 06-17474 Debtor affiliates filing separate chapter 11 petitions: Entity Case No. ------ -------- R&S Parts and Service Inc. 06-17475 Chapter 11 Petition Date: August 10, 2006 Court: District of New Jersey (Newark) Judge: Novalyn L. Winfield Debtors' Counsel: Kenneth A. Rosen, Esq. Lowenstein Sandler PC 65 Livingston Avenue Roseland, New Jersey 07068 Tel: (973) 597-2500 Fax: (973) 597-2400 Estimated Assets Estimated Debts ---------------- --------------- 1945 Route 23 Associates, $10 Million to $10 Million to Inc. $50 Million $50 Million R&S Parts and Service $10 Million to $10 Million to Inc. $50 Million $50 Million A. 1945 Route 23 Associates, Inc.'s 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Tire & Battery Corp. Trade $1,074,692 Attn: Gary Paulson 4700 Hickory Hill Road Memphis, TN 38115 Sopus Products Trade $816,137 Attn: Gary Smith 700 Milan Street 21st Floor Houston, TX 77002 BP Lubricants USA Inc. Trade $772,757 Attn: Keith Holleran 1500 Valley Road Wayne, NJ 07470 Purolator Products Inc. Trade $704,415 Attn: Jeff Frey 155 Franklin Road, Suite 153 Brentwood, TN 37027 Cooper Tire & Rubber Company Trade $699,172 Attn: John Huffman 701 Lima Avenue Findlay, OH 45840 Carroll's Inc. Trade $466,121 Attn: Paul Rolando 4281 Old Dixie Highway Atlanta, GA 30354 Factory Motor Parts Company Trade $419,675 Attn: Elliot Badzin 2855 Eagan Dale Boulevard Saint Paul, MN 55121 Robert Bosch Corporation Trade $399,884 Attn: Chuck Kerrigan 2800 South 25th Avenue Broadview, IL 60155 Honeywell International, Trade $321,888 Inc. Attn: Steve Wurst 83 Wooster Heights Road Danbury, CT 06813 Custom Accessories, Inc. Trade $306,338 Attn: Glenn Fingerhut 6440 West HOward Street Peotone, IL 60468 Exide Technologies Trade $306,330 Attn: Michael O'Malley 13000 Deerfield Parkway Building 200 Alpharetta, GA 30004 Exxon Company USA Trade $280,267 Attn: Gary Eiben 9109 Rich Woods Court Loveland, OH 45140 Bellomo Fuel & Service Trade $275,011 Attn: Frank D'Angelo 2300 East Edgar Road Linden, NJ 07036 Interdynamics, Inc. Trade $259,300 Attn: Bill Appel 34 Sudbury Road Morganville, NJ 07751 Winner International Trade $229,342 Attn: Alan Brandt 32 West State Street Pittsburgh, PA 15264 Common Cents Media Advertising $217,769 Attn: Mitch Turner 143 Norfolk Street Manhattan Beach, NY 11235 Clorox Sales Company Trade $202,485 Attn: Keith Frisby 3655 Brookside Parkway Suite 300 Alpharetta, GA 30022 Turtle Wax, Inc. Trade $184,207 Attn: Jeff Vaughn 5655 West 73rd Street Chicago, IL 60638 Schroeder & Tremayne, Inc. Trade $165,219 Attn: Steve Axmacher 8500 Velcour Avenue Saint Louis, MO 63123 Satisfied Brake Trade $158,916 Attn: Stewart Kahan 805 Education Road Cornwall Ontario K6H 6C7 Canada B. R&S Parts and Service Inc.'s 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Tire & Battery Corp. Trade $1,074,692 Attn: Gary Paulson 4700 Hickory Hill Road Memphis, TN 38115 Sopus Products Trade $816,137 Attn: Gary Smith 700 Milan Street 21st Floor Houston, TX 77002 BP Lubricants USA Inc. Trade $772,757 Attn: Keith Holleran 1500 Valley Road Wayne, NJ 07470 Purolator Products Inc. Trade $704,415 Attn: Jeff Frey 155 Franklin Road, Suite 153 Brentwood, TN 37027 Cooper Tire & Rubber Company Trade $699,172 Attn: John Huffman 701 Lima Avenue Findlay, OH 45840 Carroll's Inc. Trade $466,121 Attn: Paul Rolando 4281 Old Dixie Highway Atlanta, GA 30354 Robert Bosch Corporation Trade $399,884 Attn: Chuck Kerrigan 2800 South 25th Avenue Broadview, IL 60155 Honeywell International, Trade $321,888 Inc. Attn: Steve Wurst 83 Wooster Heights Road Danbury, CT 06813 Factory Motor Parts Company Trade $309,776 Attn: Elliot Badzin 2855 Eagan Dale Boulevard Saint Paul, MN 55121 Custom Accessories, Inc. Trade $306,338 Attn: Glenn Fingerhut 6440 West HOward Street Peotone, IL 60468 Exide Technologies Trade $306,330 Attn: Michael O'Malley 13000 Deerfield Parkway Building 200 Alpharetta, GA 30004 Exxon Company USA Trade $280,267 Attn: Gary Eiben 9109 Rich Woods Court Loveland, OH 45140 Bellomo Fuel & Service Trade $275,011 Attn: Frank D'Angelo 2300 East Edgar Road Linden, NJ 07036 Interdynamics, Inc. Trade $259,300 Attn: Bill Appel 34 Sudbury Road Morganville, NJ 07751 Winner International Trade $229,342 Attn: Alan Brandt 32 West State Street Pittsburgh, PA 15264 Common Cents Media Advertising $217,769 Attn: Mitch Turner 143 Norfolk Street Manhattan Beach, NY 11235 Clorox Sales Company Trade $202,485 Attn: Keith Frisby 3655 Brookside Parkway Suite 300 Alpharetta, GA 30022 Turtle Wax, Inc. Trade $184,207 Attn: Jeff Vaughn 5655 West 73rd Street Chicago, IL 60638 Schroeder & Tremayne, Inc. Trade $165,219 Attn: Steve Axmacher 8500 Velcour Avenue Saint Louis, MO 63123 Satisfied Brake Trade $158,916 Attn: Stewart Kahan 805 Education Road Cornwall Ontario K6H 6C7 Canada ABLE LABORATORIES: Chapter 11 Plan Effective as of August 9 ----------------------------------------------------------- Able Laboratories, Inc.'s Second Amended Chapter 11 Plan, confirmed on July 17, 2006, became effective on Aug. 9, 2006. Paul Kizel, Esq., at Lowenstein Sandler P.C., disclosed in a filing with the U.S. Bankruptcy Court for the District of New Jersey that all conditions precedent to the occurrence of the effective date have been satisfied. Pursuant to section 10 of the Plan, all prepetition unexpired leases and executory contracts not rejected by the Debtor prior to the effective date, assumed or assumed and assigned by order of the Bankruptcy Court, or the subject of a motion to assume or assume and assign pending on the effective date, are deemed rejected effective as of August 9. Claims arising out of the rejection of an executory contract or unexpired lease must be filed with the Bankruptcy Court no later than 20 days after the effective date. As reported in the Troubled Company Reporter on July 19, 2006, the Debtor's plan provides for: -- the continuation of the Debtor's business for completion of Food and Drug Administration compliance; -- assisting other government agencies with inquiries regarding the Debtor; -- the wind up of affairs and conversion of all of the Debtor's remaining assets to cash; and -- the distribution of the net proceeds to creditors in accordance with the priorities established by the Bankruptcy Code. A copy of the Second Amended Chapter 11 Plan is available for a fee at: http://www.researcharchives.com/bin/download?id=060718041438 About Able Laboratories Headquartered in Cranbury, New Jersey, Able Laboratories, Inc. -- http://www.ablelabs.com/-- developed and manufactured generic pharmaceutical products in tablet, capsule, liquid and suppository dosage forms. The Company filed for chapter 11 protection on July 18, 2005 (Bankr. D. N.J. Case No. 05-33129) after it halted manufacturing operations and recalled all of its products not meeting FDA regulatory standards. Deborah Piazza, Esq., and Mark C. Ellenberg, Esq., at Cadwalader, Wickersham & Taft LLP represent the Debtor in its restructuring efforts. David H. Stein, Esq., Michael F. Hahn, Esq., and Walter J. Greenhalgh, Esq., Duane Morris LLP, represent the Official Committee of Unsecured Creditors. The Court confirmed Able's Chapter 11 Plan on July 17, 2006. When the Debtor filed for protection from its creditors, it listed $59.5 million in total assets and $9.5 million in total debts. ACANDS INC: Exclusive Plan-Filing Period Intact Until October 12 ---------------------------------------------------------------- The Honorable Judith K. Fitzgerald of the U.S. Bankruptcy Court for the District of Delaware extended ACandS, Inc.'s exclusive period to file a Plan of Reorganization until the earlier of Oct. 12, 2006, or the effective date of the plan. The Debtor also has until the earlier of the plan effective date or Jan. 17, 2007, to solicit acceptances of that plan from its creditors. As reported in the Troubled Company Reporter on July 21, 2006, the Debtor asked for the extensions to preserve its exclusive period to file a plan to allow for any alternative structure that may result from continuing negotiations. The extension, the Debtor said, will result in a more efficient use of its estate assets and resources. Headquartered in Lancaster, Pennsylvania, ACandS, Inc., was an insulation contracting company, primarily engaged in the installation of thermal and mechanical insulation. In later years, the Debtor also performed a significant amount of asbestos abatement and other environmental remediation work. The Company filed for chapter 11 protection on Sept. 16, 2002 (Bankr. Del. Case No. 02-12687). Laura Davis Jones, Esq., at Pachulski Stang Ziehl Young Jones & Weintraub, P.C., represents the Debtor in its restructuring efforts. Kathleen Campbell Davis, Esq., and Marla Rosoff Eskin, Esq., at Campbell & Levine, LLC, represent the Official Committee of Asbestos Personal Injury Claimants. When the Company filed for protection from its creditors, it estimated debts and assets of over $100 million. Chapter 11 Plan Update Judge Fitzgerald approved the adequacy of the Debtor's Amended Disclosure Statement explaining their proposed Plan of Reorganization on Oct. 3, 2003. On Jan. 26, 2004, Judge Fitzgerald entered Proposed Findings of Fact and Conclusions of Law Re Chapter 11 Plan Confirmation (Doc. 979), recommending that the U.S. District Court deny confirmation of the Debtor's Plan. On Feb. 5, 2004, the Debtor and the Official Committee of Asbestos Personal Injury Claimants jointly filed with the District Court an objection to the Bankruptcy Court's Proposed Findings. In that filing, the Debtor and the Committee asked the District Court to reject the Bankruptcy Court's Findings and Conclusions and confirm the proposed chapter 11 plan. ACANDS INC: Has Until November 3 to Remove Civil Actions -------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware gave ACandS, Inc., until Nov. 3, 2006 or the effective date of its Plan of Reorganization, to remove pending civil actions. The Honorable Judith K. Fitzgerald ruled that the extended deadline to file notices of removal applies to all matters specified in Rule 9027(a)(A),(B), and (C)of the Federal Rules of Bankruptcy Procedure. In its extension motion, the Debtor explained that it had been unable to complete the removal process because it has devoted most of its time to: -- various litigation matters; -- compiling information related to approximately 300,000 asbestos claims; and -- securing approval of a disclosure statement and Plan of Reorganization. Headquartered in Lancaster, Pennsylvania, ACandS, Inc., was an insulation contracting company, primarily engaged in the installation of thermal and mechanical insulation. In later years, the Debtor also performed a significant amount of asbestos abatement and other environmental remediation work. The Company filed for chapter 11 protection on Sept. 16, 2002 (Bankr. Del. Case No. 02-12687). Laura Davis Jones, Esq., at Pachulski Stang Ziehl Young Jones & Weintraub, P.C., represents the Debtor in its restructuring efforts. Kathleen Campbell Davis, Esq., and Marla Rosoff Eskin, Esq., at Campbell & Levine, LLC, represent the Official Committee of Asbestos Personal Injury Claimants. When the Company filed for protection from its creditors, it estimated debts and assets of over $100 million. Chapter 11 Plan Update Judge Fitzgerald approved the adequacy of the Debtor's Amended Disclosure Statement explaining their proposed Plan of Reorganization on Oct. 3, 2003. On Jan. 26, 2004, Judge Fitzgerald entered Proposed Findings of Fact and Conclusions of Law Re Chapter 11 Plan Confirmation (Doc. 979), recommending that the U.S. District Court deny confirmation of the Debtor's Plan. On Feb. 5, 2004, the Debtor and the Official Committee of Asbestos Personal Injury Claimants jointly filed with the District Court an objection to the Bankruptcy Court's Proposed Findings. In that filing, the Debtor and the Committee asked the District Court to reject the Bankruptcy Court's Findings and Conclusions and confirm the proposed chapter 11 plan. ACRO BUSINESS: Section 341(a) Meeting Scheduled for September 7 --------------------------------------------------------------- The U.S. Trustee for Region 12 will convene a meeting of Acro Business Finance Corp.' creditors at 2:00 p.m., on Sept. 7, 2006. The meeting will be held on the 2nd Floor of the U.S. Courthouse at 300 South 4th Street, in Minneapolis, Minnesota. This is the first meeting of creditors required under 11 U.S.C. Sec. 341(a) 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 Minneapolis, Minnesota, Acro Business Finance Corp. provides financial services. The Company filed for chapter 11 protection on July 12, 2006 (Bankr. D. Minn. Case No. 06-41364). Clinton E. Cutler, Esq., at Fredrikson & Byron, P.A., represents the Debtor. When the Debtor filed for protection from its creditors, it estimated assets and debts between $10 million and $50 million. ACRO BUSINESS: Gets Final Approval to Use M&I's Cash Collateral --------------------------------------------------------------- The Hon. Robert J. Kressel of the U.S. Bankruptcy Court for the District of Minnesota allowed ACRO Business Finance Corp., on a final basis, to use up to $28,886 cash collateral securing repayment of its debts to M&I Marshall and Ilsley Bank and about $600,000 to make additional advances to clients. Use of the cash collateral will allow the Debtor to pay the costs and expenses of operating its business. A copy of the budget from July to September is available for free at http://researcharchives.com/t/s?e1d As adequate protection of M&I's interest, M&I received a postpetition replacement security interest of the same priority, dignity and effect as its prepetition interest in the Debtor's cash collateral. Headquartered in Minneapolis, Minnesota, Acro Business Finance Corp. provides financial services. The Company filed for chapter 11 protection on July 12, 2006 (Bankr. D. Minn. Case No. 06-41364). Clinton E. Cutler, Esq., at Fredrikson & Byron, P.A., represents the Debtor. When the Debtor filed for protection from its creditors, it estimated assets and debts between $10 million and $50 million. AIRADIGM COMMS: Court OKs Disclosure Statement Over FCC Objection ----------------------------------------------------------------- The Honorable Robert D. Martin of the U.S. Bankruptcy Court for the Western District of Wisconsin approved the Disclosure Statement explaining Airadigm Communications, Inc.'s Plan of Reorganization. Judge Martin ruled that the Disclosure Statement contains adequate information within the meaning of Section 1125 of the Bankruptcy Code. FCC Disclosure Objection The Federal Communications Commission objected to the approval of the Debtor's Disclosure Statement saying the Debtor proposes to treat its claims through a facially non-confirmable Plan accompanied by a hopelessly inadequate Disclosure Statement that violates bankruptcy law and FCC regulations. Based on winning bids at two separate auctions in 1996 and 1997, the FCC awarded Airadigm 13 "C Block" and two "F block" licenses for wireless telecommunication services known as Personal Communication Services. The total aggregate bid price for the 15 licenses equaled $71.4 million. Mary A. DeFalaise, Esq., an attorney at the Commercial Litigation Branch, Civil Division, of the U.S. Department of Justice, told the Court that Airadigm made a 10% down payment on each of the licenses and executed individual installment payment notes for the remainder of its bid obligations in the aggregate amount of $64.2 million. Airadigm halted all payments related to the licenses after filing its first bankruptcy petition in 1999. The Court subsequently granted the FCC an allowed claim in the principal amount of $64.2 million. The claim was secured by liens on the licenses. In May 2006, Airadigm filed it's second chapter 11 petition. At the same time, the Debtor and certain potential buyers led by Telephone & Data Systems, Inc., moved to terminate the Debtor's first bankruptcy case. They argued that the Debtor's first Plan had been substantially consummated. FCC opposed the termination of the first chapter 11 case because the Debtor had allegedly failed to address the treatment of the licenses and its unpaid allowed claim. To settle their dispute, the parties entered into a stipulation allowing the Debtor's first bankruptcy case to be terminated. Among other things, the stipulation provided that the FCC's allowed claim under the 2000 Plan would be allowed in the Debtor's new bankruptcy case. Under the 2000 Plan, the Debtor had proposed to transfer the licenses to TDS, who would then pay the FCC in full. However, according to the FCC, the Debtor's new plan proposed to modify the confirmed 2000 Plan so that it retains the benefits under that plan, but without transferring the licenses to TDS and without paying for the licenses in full. The FCC argued that this proposal violates bankruptcy law. Ms. DeFalaise also pointed out that the disclosure statement and Plan contemplate the possible return of spectrum to the FCC in contravention of FCC regulations and contemplate the possibility of paying an indeterminate portion of the FCC's allowed claim in stock of questionable value. In addition, the FCC complained that the Debtor's disclosure statement lacks the fundamental information necessary for approval. The FCC says the disclosure statement: -- contains no information with respect to the Debtor's business plan or the value of its business; -- provides no valuation of the TDS' secured claim which the Debtor plans to pay in full; -- lacks supporting material indicating what assets the Debtor will retain, what money is available to fund its Plan, and what value, if any the alleged under-secured claims will receive. In his order approving the disclosure statement, Judge Martin directed the Debtor to submit to the FCC a summary of the documents produced regarding assets, business plans and projections. A full-text copy of the Debtor's Disclosure Statement is available for a fee at: http://www.researcharchives.com/bin/download?id=060714235426 About Airadigm Headquartered in Little Chute, Wisconsin, Airadigm Communications, Inc. -- http://www.eisnteinpcs.com/-- provides local wireless phone services through its Einstein PCS wireless networking technology. The company filed for chapter 11 protection on July 28, 1999 (Bankr. W.D. Wis. Case No. 99-33500). The Court confirmed its plan of reorganization in 2000. The company filed a new chapter 11 petition on May 8, 2006 (Bankr. W.D. Wis. Case No. 06-10930). Kathryn A. Pamenter, Esq., and Ronald Barliant, Esq., at Goldberg, Kohn, Bell, Black, Rosenbloom & Moritz, Ltd., represent the Debtor in its new bankruptcy proceedings. No Official Committee of Unsecured Creditors has been appointed in the Debtor's new bankruptcy case. In its second bankruptcy filing, the Debtor estimated assets between $10 million to $50 million and debts of more than $100 million. AIRADIGM COMMS: Demands Rothschild Valuation from the FCC --------------------------------------------------------- The U.S. Bankruptcy Court for the Western District of Wisconsin will convene a hearing at 11:00 a.m., on Aug. 16, 2006, to consider Airadigm Communications, Inc.'s request to Compel the Federal Communications Commission to produce a valuation prepared by Rothschild, Inc. The Rothschild document, created in June 2004, pertains to the preliminary valuation of certain personal communication services licenses granted by the FCC to the Debtor prior to its bankruptcy filing. The FCC defends its refusal to produce the document by taking the position that: -- the work product doctrine and deliberative process privilege protect the Rothschild Valuation from disclosure; and -- the Rothschild Valuation is not discoverable because it was created by a consulting expert who will not testify at trial. FCC Licenses Based on winning bids at two separate auctions in 1996 and 1997, the FCC awarded Airadigm 13 "C Block" and two "F block" licenses for wireless telecommunication services known as Personal Communication Services. The total aggregate bid price for the 15 licenses equaled $71.4 million. Airadigm made a 10% down payment on each of the licenses and executed individual installment payment notes for the remainder of its bid obligations in the aggregate amount of $64.2 million. Airadigm halted all payments related to the licenses after filing its first bankruptcy petition in 1999. The Court subsequently granted the FCC an allowed claim in the principal amount of $64.2 million. The claim was secured by liens on the licenses. In May 2006, Airadigm filed its second chapter 11 petition. At the same time, the Debtor and certain potential buyers led by Telephone & Data Systems, Inc., moved to terminate the Debtor's first bankruptcy case. They argued that the Debtor's first Plan had been substantially consummated. FCC opposed the termination of the first chapter 11 case because the Debtor had allegedly failed to address the treatment of the licenses and its unpaid allowed claim. To settle their dispute, the parties entered into a stipulation allowing the Debtor's first bankruptcy case to be terminated. Among other things, the stipulation provided that the FCC's allowed claim under the 2000 Plan would be allowed in the Debtor's new bankruptcy case. The Court approved, on Aug. 5, 2006, the Debtor's disclosure statement despite the FCC's objection. License Valuation The value of the licenses is one of the primary issues in the Debtor's bankruptcy case. The Court has scheduled a valuation hearing at 9:30 a.m., on Sept. 27, 2006, to establish the value of the licenses, to the extent that these licenses secure the FCC's claims. In preparation for the valuation hearing, the Debtor and the FCC have been engaged in extensive discovery. The Debtor's discovery includes a request for the Rothschild Valuation and any prior reports of valuation in the FCC's possession. Kathryn A. Pamenter, Esq., at Goldberg, Kohn, Bell, Black, Rosenbloom & Moritz, Ltd., tells the Court that the FCC has refused to produce the Rothschild Valuation even if the document is within the scope of the Debtor's discovery request and is directly relevant to one of the primary issues in the Debtor's bankruptcy case. Ms. Pamenter argues that the FCC has failed to satisfy its burden of establishing that the Rothschild Valuation deserves work product or deliberative process protection. The work product doctrine provides for an exception to liberal discovery rules where documents are "prepared in anticipation of litigation or for trial." Ms. Pamenter said that this concept is inapplicable in the license dispute because the Rothschild Valuation was created approximately two years earlier, at a time when neither party could have anticipated litigation involving the value of the licenses. The FCC also contends that the "deliberative process privilege" protects the Rothschild Valuation from disclosure. The deliberative process privilege is a privilege that is entirely unique to litigation involving government entities. The deliberative process privilege is intended to: -- improve the quality of agency policy decisions by promoting a creative and candid debate; -- protect the public from confusion arising from premature exposure to policy discussions; and -- protect the integrity of the decision-making process. In order for a document to be covered by the deliberative process privilege, the document must actually precede the adoption of an agency policy and must be part of the deliberative process by which an agency policy decision is made. The Debtor asserts that the FCC's failure to identify any specific "agency decision" to which the Rothschild Valuation correlates means that it has failed to satisfy its burden of proving deliberative process protection. About Airadigm Headquartered in Little Chute, Wisconsin, Airadigm Communications, Inc. -- http://www.eisnteinpcs.com/-- provides local wireless phone services through its Einstein PCS wireless networking technology. The company filed for chapter 11 protection on July 28, 1999 (Bankr. W.D. Wis. Case No. 99-33500). The Court confirmed its plan of reorganization in 2000. The company filed a new chapter 11 petition on May 8, 2006 (Bankr. W.D. Wis. Case No. 06-10930). Kathryn A. Pamenter, Esq., and Ronald Barliant, Esq., at Goldberg, Kohn, Bell, Black, Rosenbloom & Moritz, Ltd., represent the Debtor in its new bankruptcy proceedings. No Official Committee of Unsecured Creditors has been appointed in the Debtor's new bankruptcy case. In its second bankruptcy filing, the Debtor estimated assets between $10 million to $50 million and debts of more than $100 million. ALERIS INTERNATIONAL: Board of Directors Okay Aurora Merger Pact ---------------------------------------------------------------- Aleris International, Inc.'s Board of Directors unanimously approved the Agreement and Plan of Merger with Aurora Acquisition Merger Sub, Inc.. On Aug. 7, 2006, the Company entered into an Agreement and Plan of Merger pursuant to which Aurora Acquisition Holdings, Inc.'s wholly-owned subsidiary, Aurora Merger, will merge with and into Aleris. Aleris will continue as the surviving corporation and becoming a wholly-owned subsidiary of Aurora Holdings. Aurora Holdings is owned by affiliates of Texas Pacific Group. Pursuant to the Merger Agreement: * each outstanding share of common stock of Aleris other than shares owned by Aurora Holdings, Aurora Merger Sub or any subsidiary of Aurora Holdings or Aleris, * shares held in the treasury of Aleris, and * shares held by any stockholders who are entitled to and who properly exercise appraisal rights under Delaware law, will be cancelled and converted into the right to receive $52.50 in cash, without interest. The Merger Agreement also provides for a post-signing "go-shop" period which permits Aleris to solicit competing acquisition proposals until 12:01 a.m. on September 7, 2006 from any person who directly or indirectly through a controlled entity manufactures or fabricates metals and is not a discretionary private equity fund or other discretionary investment vehicle. A full text-copy of the Agreement and Plan of Merger, dated as of August 7, 2006, is available for free at: http://ResearchArchives.com/t/s?f6b About Aleris International Headquartered in Beachwood, Ohio, a suburb of Cleveland, Aleris International, Inc. -- http://www.aleris.com/-- manufactures rolled aluminum products and is a global leader in aluminum recycling and the production of specification alloys. The company also manufactures value-added zinc products that include zinc oxide, zinc dust and zinc metal. The Company operates 42 production facilities in the United States, Brazil, Germany, Mexico and Wales, and employs approximately 4,200 employees. * * * As reported in the Troubled Company Reporter on July 18, 2006, Standard & Poor's Ratings Services affirmed its 'BB-' corporate credit rating on Aleris International Inc. and removed it from CreditWatch, where it was placed with negative implications on March 21, 2006. The CreditWatch placement followed Aleris' announcement that it would acquire the downstream aluminum assets of Corus Group PLC (BB/Stable/B) for US$880 million in cash and assumed debt. S&P said the outlook is negative. At the same time, Standard & Poor's assigned its 'BB-' and '2' recovery ratings to the company's proposed US$650 million senior secured term loan B. The '2' recovery rating indicates the expectation of a substantial recovery of principal in the event of a payment default. The ratings are based on preliminary terms and conditions and are predicated on the completion of the Corus transaction and related financings substantially in the form currently anticipated. As reported in the Troubled Company Reporter on July 12, 2006, Moody's Investors Service confirmed Aleris International, Inc.'s B1 corporate family rating. In a related rating action, Moody's assigned a Ba3 rating to the company's proposed 7 year senior secured guaranteed term loans aggregating US$650 million, which Aleris is issuing to partially finance its EUR691 million acquisition of certain aluminum assets from Corus Group plc and refinance its existing debt. Moody's confirmed the B2 rating on the 10-3/8% senior secured notes and the B3 rating on the 9% senior unsecured notes. The ratings for the proposed financings assume that the tender offer will be successful, the desired consents obtained and that the acquisition and associated financing transactions will close as contemplated. At such time, Moody's ratings for Aleris's existing debt will be withdrawn. The ratings outlook is negative. AMERISOURCEBERGEN: Board OKs New $750MM Share Repurchase Program ---------------------------------------------------------------- The Board of Directors of AmerisourceBergen Corporation authorized a new share repurchase program, which allows the Company to repurchase up to $750 million of its outstanding shares of common stock subject to market conditions. The new repurchase program will begin after completion of the AmerisourceBergen's current repurchase program, which has approximately $238.7 million remaining. As of July 31, 2006, the Company had approximately 201.6 million common shares outstanding. AmerisourceBergen will repurchase the shares from time to time for cash in open market transactions or by other means in accordance with applicable federal securities laws, and will hold any repurchased shares as treasury shares, which will be available for general corporate purposes. Based in Valley Forge, Pennsylvania, AmerisourceBergen Corp. (NYSE:ABC) -- http://www.amerisourcebergen.com/-- is a pharmaceutical services company in the United States and Canada. Servicing pharmaceutical manufacturers and healthcare providers in the pharmaceutical supply channel, the Company provides drug distribution and related services designed to reduce costs and improve patient outcomes. * * * As reported in the Troubled Company Reporter on June 5, 2006, Moody's Investors Service upgraded AmerisourceBergen Corporation's Corporate Family Rating to Ba1 from Ba2. The Company's rating for its senior unsecured notes was upgraded to Ba1 from Ba2. The speculative grade liquidity rating of SGL-1 is affirmed. Moody's said the rating outlook is stable. AMERUS GROUP: To Redeem Series A Perpetual Preferred Stock ---------------------------------------------------------- AmerUs Group Co. plans to redeem all of its issued and outstanding shares of Series A Non-Cumulative Perpetual Preferred Stock on Sept. 13, 2006. Under the terms of the redemption, all six million shares will be redeemed at a price equal to the greater of (i) $25 per share or (ii) the sum of the present values of $25 per share and all undeclared dividends for the dividend periods from the redemption date to and including the dividend payment date on Sept. 15, 2010, discounted to the redemption date on a quarterly basis (assuming a 360-day year consisting of twelve 30-day months) at the treasury rate (as calculated on Sept. 8, 2006), plus 139.5 basis points plus all declared and unpaid dividends to the redemption date. Funding for the redemption will primarily come from the settlement of the forward purchase contracts forming a portion of the Company's Income PRIDES (NYSE:AMH PrA) upon their maturity on Aug. 16, 2006. At that time, the company will receive $143,750,000 upon maturity of the portfolio of U.S. Treasury securities pledged as collateral by holders of the Income PRIDES to secure their obligation to purchase shares of common stock of the company on Aug. 16, 2006. About AmerUs Group Headquartered in Des Moines, Iowa, AmerUs Group Co. (NYSE:AMH) -- http://www.amerus.com/-- is a corporation engaged through its subsidiaries in the business of marketing and distributing individual life insurance and annuity products in 50 states, the District of Columbia and the U.S. Virgin Islands. Its major operating subsidiaries include AmerUs Life Insurance Company, American Investors Life Insurance Company, Inc., Indianapolis Life Insurance Company and Bankers Life Insurance Company of New York. * * * As reporter in the Troubled Company Reporter on March 20, 2006, Moody's Investors Service affirmed the Baa3 senior debt rating of AmerUs Group Company and changed the rating outlook for AmerUs Group Company to stable from negative. The ratings of other affiliated AmerUs companies were also affirmed, and their rating outlook was also changed to stable from negative. The outlook change reflected the recent settlement of a private class action lawsuit in California at a modest cost, as well as Moody's expectation that any additional legal settlements are likely to be manageable. AMKOR TECH: Delayed Form 10-Q Filing Cues S&P's Developing Outlook ------------------------------------------------------------------ Standard & Poor's Ratings Services revised its outlook on Chandler, Arizona-based Amkor Technology Inc. to Developing from Positive, following the company's announcement that it does not expect to file its second quarter 10-Q by the deadline established for late filings. The delay has been caused by a review of the company's historical stock option practices by a special committee of the board of directors. The special committee was formed by the board of directors on July 24, 2006, and its review is ongoing. The corporate credit rating was affirmed at 'B+' "The developing outlook reflects uncertainty regarding the outcome of the stock option review," said Standard & Poor's credit analyst Lucy Patricola. In the event financials are filed and the review concludes with no material restatements and no findings of management wrongdoing, the outlook will be revised to positive, reflecting operational improvements and deleveraging. Should there be an extended filing delay in filing or if the review concludes with material restatements, the need for further investigation, or additional involvement of the SEC, the outlook could be revised to negative or the rating could be lowered. The ratings on Amkor reflect challenging industry characteristics, including high operating and financial leverage and highly cyclical and competitive industry conditions. These factors are only partly offset by the company's strong market position and improving operational trends. Amkor is a leading independent provider of outsourced packaging and testing services to semiconductor makers. Based on preliminary results for the June 2006 quarter, sales for the trailing 12 months were $2.5 billion and total lease-adjusted debt was $2.1 billion. ANDREW CORPORATION: Rejects CommScope Acquisition Proposal ---------------------------------------------------------- CommScope, Inc. responded to Andrew Corporation's rejection of its proposal to acquire all of Andrew's outstanding shares for $9.50 per share in cash: "We are disappointed that Andrew has decided to reject our proposal. After careful consideration with our advisors, CommScope has decided not to pursue its proposal to acquire Andrew Corporation at the present time. CommScope's operational excellence and financial discipline has made us a global leader in the 'last mile' of telecommunications. We intend to continue building upon our leadership position and we are confident that CommScope is poised to continue creating value for its stockholders." About CommScope Based in Hickory, North Carolina, CommScope, Inc. (NYSE:CTV) -- http://www.commscope.com/-- designs and manufactures "last mile" cable and connectivity solutions for communication networks. Through its SYSTIMAX(R) Solutions(TM) and Uniprise(R) Solutions brands CommScope is the global leader in structured cabling systems for business enterprise applications. It is also the world's largest manufacturer of coaxial cable for Hybrid Fiber Coaxial applications. Backed by strong research and development, CommScope combines technical expertise and proprietary technology with global manufacturing capability to provide customers with high-performance wired or wireless cabling solutions. About Andrew Corporation Based in Westchester, Illinois, Andrew Corporation (Nasdaq: ANDW) -- http://www.andrew.com/-- designs, manufactures, and delivers innovative and essential equipment and solutions for the global communications infrastructure market. The company serves operators and equipment manufacturers from facilities in 35 countries. The Company is an S&P 500 company founded in 1937. ANDREW CORPORATION: Rejected Bids Prompt S&P's Negative Watch ------------------------------------------------------------- Standard & Poor's Ratings Services revised its CreditWatch implications on Andrew Corp. to negative from developing. The 'BB' corporate credit rating and other ratings on the company were placed on CreditWatch developing on Aug. 7, 2006. The action follows Andrew's announcement that it terminated the existing stock-based offer made by ADC Telecommunications (based on mutual agreement), whose value had declined from $2 billion to $1.3 billion over the last few months. Andrew also rejected the $1.7 billion cash bid made by CommScope Inc. (BB/Watch Neg/--). "At this point, it is uncertain what direction Andrew's management will take but it may potentially include plans to engage in defensive measures," said Standard & Poor's credit analyst Bruce Hyman. CommScope's bid remains outstanding and may be revised or withdrawn. S&P will monitor developments and respond accordingly. ARCAP 2005-RR5: Fitch Affirms Low-B Ratings on Six Class Certs. --------------------------------------------------------------- Fitch affirms these ARCap 2005-RR5 Resecuritization, Inc., commercial mortgage-backed securities pass-through certificates as: -- $26.1 million class A-1 at 'AAA'; -- $26.1 million class A-2 at 'AAA'; -- $26.2 million class A-3 at 'AAA'; -- $21.9 million class B at 'AA'; -- $21.9 million class C at 'A'; -- $3.1 million class D at 'A-'; -- $12.5 million class E at 'BBB+'; -- $9.4 million class F at 'BBB'; -- $9.4 million class G at 'BBB-'; -- $15.7 million class H at 'BB+'; -- $6.3 million class J at 'BB'; -- $9.4 million class K at 'BB-'; -- $9.4 million class L at 'B+'; -- $9.4 million class M at 'B'; -- $9.4 million class N at 'B-'. Fitch does not rate class O and the interest only class X. The rating affirmations are the result of stable credit enhancement and performance of the underlying collateral since issuance. As of the July 2006 distribution date, the transaction has been reduced by 11.5% to $277.3 million from $313.4 million at issuance. The reduction in collateral balance is due to losses which were anticipated at issuance. The certificates are collateralized by all or a portion of 26 classes of 18 separate underlying fixed-rate commercial mortgage- backed securities transactions. The current weighted average rating factor of the underlying bonds is 47.7, corresponding to an average rating of CCC, stable from issuance. The classes' ratings are based on Fitch's actual rating, or on Fitch's internal credit assessment for those classes not rated by Fitch. Delinquencies in the underlying transaction are: * 30 days: 0.2%; * 60 days: 0.04%; * 90+ days: 0.2%; * Foreclosure: 0.1%; and * real estate owned: 0.4%. ASARCO LLC: Wants to File Employment Application Under Seal ----------------------------------------------------------- ASARCO LLC seeks permission from the U.S. Bankruptcy Court for the Southern District of Texas in Corpus Christi to file an application for the employment of certain professionals under seal. ASARCO intends to employ certain professionals to perform due diligence and other related work in connection with a potential asset sale. Tony M. Davis, Esq., at Baker Botts L.L.P., in Houston, Texas, emphasizes that the employment application must be filed under seal to protect ASARCO's competitive position during the diligence process. By maintaining the confidentiality of ASARCO's business strategy, its ability to sell the asset for the maximum possible value will be enhanced, which will further ASARCO's reorganization efforts, Mr. Davis says. ASARCO has disclosed the contents of the Employment Application to counsel for the Official Committee of Unsecured Creditors for ASARCO and the Asbestos Subsidiary Debtors, the Department of Justice, and the Attorney General for the State of Texas, Mr. Davis tells the Court. ASARCO will also serve the Employment Application to the counsel of key constituencies in ASARCO's bankruptcy case. Mr. Davis says these key parties-in-interest must have access to the Employment Application so that they may evaluate the merits of the proposed employment, in connection with their fiduciary duties. Headquartered in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/-- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. The Company filed for chapter 11 protection on Aug. 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207). James R. Prince, Esq., Jack L. Kinzie, Esq., and Eric A. Soderlund, Esq., at Baker Botts L.L.P., and Nathaniel Peter Holzer, Esq., Shelby A. Jordan, Esq., and Harlin C. Womble, Esq., at Jordan, Hyden, Womble & Culbreth, P.C., represent the Debtor in its restructuring efforts. Lehman Brothers Inc. provides the ASARCO with financial advisory services and investment banking services. Paul M. Singer, Esq., James C. McCarroll, Esq., and Derek J. Baker, Esq., at Reed Smith LLP give legal advice to the Official Committee of Unsecured Creditors and David J. Beckman at FTI Consulting, Inc., gives financial advisory services to the Committee. When the Debtor filed for protection from its creditors, it listed $600 million in total assets and $1 billion in total debts. The Debtor has five affiliates that filed for chapter 11 protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521 through 05-20525). They are Lac d'Amiante Du Quebec Ltee, CAPCO Pipe Company, Inc., Cement Asbestos Products Company, Lake Asbestos of Quebec, Ltd., and LAQ Canada, Ltd. Details about their asbestos-driven chapter 11 filings have appeared in the Troubled Company Reporter since Apr. 18, 2005. Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle, Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No. 05-21346) also filed for chapter 11 protection, and ASARCO has asked that the three subsidiary cases be jointly administered with its chapter 11 case. On Oct. 24, 2005, Encycle/Texas' case was converted to a Chapter 7 liquidation proceeding. The Court appointed Michael Boudloche as Encycle/Texas, Inc.'s Chapter 7 Trustee. Michael B. Schmidt, Esq., and John Vardeman, Esq., at Law Offices of Michael B. Schmidt represent the Chapter 7 Trustee. (ASARCO Bankruptcy News, Issue No. 26; Bankruptcy Creditors' Service, Inc., 215/945-7000, http://bankrupt.com/newsstand/) ASARCO LLC: Hires RECON Real Estate as Broker for 3 El Paso Land ---------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of Texas in Corpus Christi authorized ASARCO LLC to employ RECON Real Estate Consultants, Inc., as its broker, for the sale of three tracts of land located in El Paso County, Texas: 1. Tract 1, John Barker Survey #10, containing approximately 125.956 acres; 2. Crazy Cat 1 and 2, containing approximately 42 acres; and 3. a portion of Tract 2A, John Barker Survey #10, containing approximately 246.97 acres and located just South of Executive Center Drive and East of Interstate 10. As reported in the Troubled Company Reporter on July 7, 2006, RECON will receive a commission equal to 4.5% of the gross sales price of the Property as payment for its marketing services to ASARCO. Matt M. Blaugrund, vice president of RECON Real Estate Consultants, assured the Court that his firm does not hold interests adverse to ASARCO and its estate, and is disinterested as that term is defined in Section 101(14) of the Bankruptcy Code. Headquartered in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/-- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. The Company filed for chapter 11 protection on Aug. 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207). James R. Prince, Esq., Jack L. Kinzie, Esq., and Eric A. Soderlund, Esq., at Baker Botts L.L.P., and Nathaniel Peter Holzer, Esq., Shelby A. Jordan, Esq., and Harlin C. Womble, Esq., at Jordan, Hyden, Womble & Culbreth, P.C., represent the Debtor in its restructuring efforts. Lehman Brothers Inc. provides the ASARCO with financial advisory services and investment banking services. Paul M. Singer, Esq., James C. McCarroll, Esq., and Derek J. Baker, Esq., at Reed Smith LLP give legal advice to the Official Committee of Unsecured Creditors and David J. Beckman at FTI Consulting, Inc., gives financial advisory services to the Committee. When the Debtor filed for protection from its creditors, it listed $600 million in total assets and $1 billion in total debts. The Debtor has five affiliates that filed for chapter 11 protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521 through 05-20525). They are Lac d'Amiante Du Quebec Ltee, CAPCO Pipe Company, Inc., Cement Asbestos Products Company, Lake Asbestos of Quebec, Ltd., and LAQ Canada, Ltd. Details about their asbestos-driven chapter 11 filings have appeared in the Troubled Company Reporter since Apr. 18, 2005. Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle, Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No. 05-21346) also filed for chapter 11 protection, and ASARCO has asked that the three subsidiary cases be jointly administered with its chapter 11 case. On Oct. 24, 2005, Encycle/Texas' case was converted to a Chapter 7 liquidation proceeding. The Court appointed Michael Boudloche as Encycle/Texas, Inc.'s Chapter 7 Trustee. Michael B. Schmidt, Esq., and John Vardeman, Esq., at Law Offices of Michael B. Schmidt represent the Chapter 7 Trustee. (ASARCO Bankruptcy News, Issue No. 26; Bankruptcy Creditors' Service, Inc., 215/945-7000, http://bankrupt.com/newsstand/) ASSOCIATED BRANDS: Posts $578,000 Net Loss for Period Ended July 1 ------------------------------------------------------------------ Associated Brands Income Fund reported net loss of $578,000 for the three months ended July 1, 2006, from revenues of $37 million compared to net earnings of $1.2 million for the three months ended July 2, 2005. For the six months ended July 1, 2006, the Fund reported a net loss of $1.7 million from revenues of $73.8 million compared to net earnings of $2.2 million from revenues of $72.2 million for the prior year. The Fund disclosed that continuing its revenue growth momentum experienced in the fourth quarter of 2005 and first quarter of 2006, sales volumes and revenues in the second quarter of 2006 increased by 1% and 2.5% respectively compared to last year's second quarter. For the six months ended July 1, 2006, sales volumes and revenues increased by 2.4% and 2.2% respectively compared to the first six months of 2005. Compared to the first quarter of 2006, revenues in the second quarter rose 1.1%. As a percent of sales, the Fund's gross margins improved 3.3% to 17.2% in the second quarter. The Fund further disclosed, earnings before interest, taxes, depreciation and amortization non-controlling interest and non- recurring expenses or income in the second quarter of 2006 were $1.9 million compared to $2.8 million in the same period last year. For the first six months of 2006, EBITDA was $2.7 million compared to $5.5 million for the same period last year. Continued Default Under Credit Agreement The Fund also disclosed that, it continues to be in default under the credit agreement with its bank and under the exchangeable subordinated debentures of Associated Brands Holdings Limited Partnership, and that its management is working diligently to conclude negotiations with the bank and the debenture holders with respect to the its ongoing credit relationship with the parties. A copy of the Fund's Second Quarter 2006 Consolidated Financial Statements and Management's Discussion and Analysis is available for free at http://ResearchArchives.com/t/s?f8b Associated Brands Income Fund (TSX: ABF.UN) -- http://www.associatedbrands.com-- through its operating subsidiaries, is a North American manufacturer and supplier of private-label dry-blend food products and household products. Associated Brands plans to build unitholder value by leveraging its solid presence in the U.S. private-label market, expanding its product offerings to current and new customers and adding additional contract manufacturing business, and through accretive acquisitions. ATLANTIS PLASTICS: S&P Cuts Ratings and Says Outlook is Negative ---------------------------------------------------------------- Standard & Poor's Ratings Services lowered its corporate credit rating on Atlanta, Georgia-based Atlantis Plastics Inc. to 'B-' from 'B'. S&P also lowered the other ratings on the company. The outlook is negative. "The downgrade reflects challenging industry conditions, which have forestalled the expected trend of improvement to the company's financial profile," said Standard & Poor's credit analyst Robyn Shapiro. Credit statistics have reflected negative cash flow generation that has contributed to a modest increase to debt levels in recent quarters. In addition, S&P believes that raw material costs could increase in the near term and will likely remain volatile for some time. Although the company should continue to be able to pass through much of the increase to its customers, this could become increasingly difficult or could occur with a lag, thereby adding to the risk of further pressure to the company's very limited liquidity. The ratings on Atlantis Plastics reflect a highly leveraged financial risk profile, which overshadows its vulnerable business risk profile in highly competitive, cyclical polyethylene film and injection-molded plastic products, serving mainly industrial customers. With annual revenues of about $440 million, Atlantis Plastics enjoys a competitive position in plastic films -- including stretch films and custom films that represent about 64% of revenues -- stemming from a decent cost structure and effective distribution capabilities. Injection-molded products (about 28% of sales) include components sold to original equipment manufacturers mainly in the home appliance industry, and siding panels for the home building industry and residential replacement market. Profile-extruded products account for 8% of sales and are used in recreational vehicles, mobile homes, and other consumer and commercial products. Atlantis Plastics has meaningful shares in various products, including low-density polyethylene stretch films used for wrapping pallets of industrial and commercial goods for shipping or storage. Still, several competitors have far greater financial resources and there are only moderate barriers to entry. Moreover, the company's plastic films segment has commodity-like characteristics; therefore, sales volumes and operating profits can vary depending upon supply and demand conditions and fluctuations in costs of key raw materials that are derived from oil and natural gas. The company does not have contractual arrangements with customers for a majority of its sales, but it has generally been able to pass through raw material cost increases. BANCORP FINANCIAL: Fitch Withdraws Rating on Class C Notes ---------------------------------------------------------- Fitch Ratings withdraws the rating on this class of notes for Bancorp Financial Services L.L.C., Series 2001-A: -- Class C Notes remain at 'C/DR6' and are withdrawn. In its review of BFS 2001-A, Fitch noted significant undercollateralization due to prior portfolio deterioration from high delinquencies and defaults. Furthermore, the transaction has zero collateral balance outstanding as of May 2006. As a result the transaction is significantly undercollateralized with $1.9 million outstanding in Class C Notes. Fitch does not anticipate any future significant recoveries. Based on this review, Class C notes remain at 'C/DR6' and the rating is withdrawn. BLEECKER STRUCTURED: S&P Cuts Ratings and Removes Negative Watch ---------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on the class A-1 and A-2 notes issued by Bleecker Structured Asset Funding Ltd., a CDO of ABS, to 'B-' and removed them from CreditWatch with negative implications, where they were placed May 19, 2006. The ratings on the class A-1 and A-2 notes were previously lowered Aug. 12, 2004, and Nov. 7, 2005. The lowered ratings reflect a decrease in the credit enhancement available to support the notes as evidenced by decline in the class A overcollateralization ratio to 75.9% in June 2006 from 81.2% in November 2005, even though the notes continue to pay down every payment period and the current balance of notes is 22.80% of its original balance. In addition, the deal continues to be significantly overhedged, which causes a drain on the cash available to pay down the notes. Standard & Poor's notes that when calculating its overcollateralization ratio, Bleecker Structured Asset Funding Ltd. "haircuts" (or reduces the principal value of) a percentage of assets rated below its rating threshold and excludes the balance in the principal cash account. According to the June 27, 2006, trustee report, the overcollateralization ratio included an $11.87 million haircut to the numerator and did not consider the $12.48 million cash balance in the principal collection account. If the haircut and principal cash balance are added to the numerator, the adjusted overcollateralization ratio as of June 2006 is 101.79%; a similar calculation using the November 2005 numbers results in an adjusted overcollateralization ratio of 109.83%, revealing a decline in the support available for the rated notes. Standard & Poor's will continue to monitor the transaction for any credit deterioration in the underlying collateral pool or any losses due to the sale or write-down of the collateral securities that might adversely affect the credit support for the rated notes. Ratings Lowered And Removed Creditwatch Negative Bleecker Structured Asset Funding Ltd. Rating ------ Class To From ----- -- ---- A-1 B- BB+/Watch Neg A-2 B- BB+/Watch Neg Transaction Information Issuer: Bleecker Structured Asset Fund Ltd. Co-issuer: Bleecker CBO Delaware Corp. Current manager: Clinton Group Inc. Underwriter: Prudential Securities Inc. Trustee: JPMorganChase Bank Transaction type: CDO of ABS Tranche Initial Prior Current Information Report Downgrade Action Date (MM/YYYY) 05/2000 11/2005 08/2006 Class A-1 note rating AAA BB+ B- Class A-2 note rating AAA BB+ B- Class A o/c ratio (%) 126.5 81.2 75.9* Class A o/c ratio minimum (%) 106.5 106.50 106.50 Class A-1 note balance ($ mil.) 45.0 13.48 10.26 (i) Class A-2 note balance ($ mil.) 315.0 94.36 71.82 (i) o/c - Overcollateralization. * The current class A o/c ratio was taken from the trustee's monthly report dated June 27, 2006. (i)The class A balances were adjusted for paydowns based on the trustee's note valuation report as of July 3, 2006. Industry Exposure CBO (%) 5.99 CMBS/REIT (%) 19.71 Commercial ABS (%) 47.69 Consumer ABS (%) 2.87 RMBS (%) 23.73 Portfolio Benchmarks Current S&P weighted average rating (excl. defaulted) BB S&P default measure (excl. defaulted) 2.20 S&P variability measure (excl. defaulted) 2.85 S&P correlation measure (excl. defaulted) 1.16 Rated O/C Ratios (ROCs)* Current Class A-1 (%) 100.90 Class A-2 (%) 100.90 * For this transaction and rating, ROC was calculated by dividing the break-even rate by the scenario default rate. BOWNE & CO: Earns $6.5 Million for Quarter Ended June 30 -------------------------------------------------------- Bowne & Co., Inc., reported net income for the quarter ended June 30, 2006 of $6.5 million, compared to net income of $2.4 million for the same period in the prior year. The Company's net income for the six months ended June 30, 2006 was $8 million, versus $5 million in the same period of 2005. The company reported 2006 second quarter earnings from continuing operations of $10.4 million as compared to $5.4 million for the second quarter of 2005. Revenue was $260.3 million in the second quarter of 2006, compared to $197.6 million in the comparable quarter of 2005. For the six months ended June 30, 2006, the Company's income from continuing operations was $11.9 million versus $8.3 million for the same period last year. Revenue for the six months ended June 30, 2006 was $466 million, up 30% from $357.6 million reported in 2005. Cash used in the Company's operations for the quarter ended June 30, 2006 increased $24 million to $56 million, from net cash used in operations of $32 million in 2005. "Our focus on our core businesses resulted in a solid performance this quarter," Philip E. Kucera, chairman and chief executive officer, said. "Overall, revenue growth was impressive, driven by strong organic growth in Financial Print and the revenue generated by the Vestcom business we acquired." David J. Shea, president and chief operating officer, added, "This was a great quarter for Bowne. Financial Print revenue is up in all categories, with transactional revenue reaching its highest level since 2002. Total Financial Print revenue was at its highest level since 2000. Marketing & Business Communications substantially completed the integration of its two businesses ahead of schedule and is well-positioned for the second half of the year." The Company disclosed that, in keeping with its strategy of focusing on its core businesses, it reclassified DecisionQuest and JFS Litigators Notebook(R), which are being held for sale, as discontinued operations. Its 2006 discontinued operations results include a $9.9 million gain on the sale of CaseSoft, a joint venture investment held by DecisionQuest and a $13.3 million goodwill impairment charge related to DecisionQuest. The Company repurchased, from December 2004 through June 30, 2006, 7.6 million shares at an average price per share of $14.75. In 2006 through June 30, it has repurchased 2.4 million shares at an average price per share of $14.51, of which approximately 1.6 million shares were purchased in the second quarter of 2006. As of August 4, 2006, the company had $74.4 million remaining for share repurchases. Based in New York City, Bowne & Co., Inc. (NYSE: BNE) -- http://www.bowne.com/-- is a printing company, which specializes in financial documents such as prospectuses, annual and interim reports, and other paperwork required by the SEC. Bowne also handles electronic filings via the SEC's EDGAR system and provides electronic distribution and high-volume mailing services. The financial printing business accounts for the bulk of the company's sales. Bowne also offers marketing and business communications services and litigation support software. The Company has 3,500 employees in 78 offices around the globe. * * * As reported in the Troubled Company Reporter on Feb. 8, 2006, Moody's Investors Service affirmed the rating on Bowne & Co., Inc.'s $75 million Convertible Subordinated Debentures due 2033 at B2 and affirmed Bowne's Corporate Family Ba3 rating. Moody's changed the outlook to positive from stable. CAL-BAY INT'L: Board to Accelerate Foreign Delisting Program ------------------------------------------------------------ The Board of Directors of Cal-Bay International, Inc. intends to accelerate the delisting of Cal-Bay Securities offerings on Foreign Exchanges. Cal-Bay International reported, on Aug. 10, 2006, its intention to accelerate file applications for revocation of its securities listings and admissions to all foreign exchanges. The removal is expected to be finalized as soon as possible, upon completion of the process for each exchange. Cal-Bay has made this decision on the basis that for some time there has not been a significant institutional shareholder base in the European marketplace. "We feel there is a virtually unlimited opportunity for expansion in North America, and we intend to increase market share and awareness on a regular basis," Roger Pawson, the Company's president, commented. "As a Company we have grown substantially in the last year and a half and have significantly increased our assets, equity and corporate awareness." After the effective date of the delisting it will no longer be possible to trade Cal-Bay stock on International Stock Exchanges. However, ordinary shares will continue to be listed on the OTC Bulletin Board. About Cal-Bay Cal-Bay International, Inc. (OTCBB: CBAY) was originally incorporated in the State of Nevada on Dec. 9, 1998, under the name Var-Jazz Entertainment, Inc. Var-Jazz was organized to engage in the business of music production and sales. Var-Jazz did not succeed in the music business and the board of directors determined it was in the best interest of the Company to seek additional business opportunities. On March 8, 2001, Var-Jazz entered into an Agreement and Plan of Reorganization with Cal-Bay Controls, Inc., whereby Var-Jazz changed its name to Cal-Bay International, Inc., and acquired Cal-Bay Controls, Inc., as a wholly owned subsidiary in exchange for 17,112,000 shares of common stock. Going Concern Doubt Lawrence Scharfman CPA PC expressed substantial doubt about Cal- Bay's ability to continue as a going concern after auditing the Company's financial statements for the years ended Dec. 31, 2005 and 2004. The auditing firm pointed to the Company's need to secure additional working capital for its planned activity and to service its debt. At March 31, 2006, the Company's balance sheet showed $11,975,743 in total assets and $2,472,991 in total liabilities resulting in a stockholders' equity of $9,502,752. CALLA PROPERTIES: Case Summary & Three Largest Unsecured Creditors ------------------------------------------------------------------ Debtor: Calla Properties, Inc. 1830 Hillsdale Avenue, Suite 2 San Jose, California 95124 Bankruptcy Case No.: 06-51527 Type of Business: Chapter 11 Petition Date: August 11, 2006 Court: Northern District of California (San Jose) Judge: Arthur S. Weissbrodt Debtor's Counsel: Basil J. Boutris, Esq. Vaught & Boutris LLP 80 Swan Way, Suite 320 Oakland, California 94621 Tel: (510) 430-1518 Estimated Assets: $10 Million to $50 Million Estimated Debts: $10 Million to $50 Million Debtor's 3 Largest Unsecured Creditors: Entity Claim Amount ------ ------------ Vision Lending & Investments, Inc. $1 215 River Street Santa Cruz, California 95060 Sundean Foundation $1 c/o Law Offices of Reg J. Johnson 236 Los Gatos Boulevard Los Gatos, California 95030 Harry Firestone $1 4201 Ironshoe Drive San Jose, California 95138 CARLTON COVE: Case Summary & 17 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Carlton Cove, Inc. One Carlton Cove Boulevard Huntsville, Alabama 35802 Bankruptcy Case No.: 06-81553 Type of Business: The Debtor offers independent living homes and apartments, assistance with daily living activities, dementia care and skilled nursing care. See http://carltoncove.org/ Chapter 11 Petition Date: August 9, 2006 Court: Northern District of Alabama (Decatur) Judge: Jack Caddell Debtor's Counsel: Robert H. Adams, Esq. Maynard Cooper & Gale PC 1901 Sixth Avenue North 2400 AmSouth/Harbert Plaza Birmingham, Alabama 35203 Tel: (205) 254-1000 Fax: (205) 254-1999 Total Assets: $41,992,164 Total Debts: $78,615,718 Debtor's 17 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Bonds - Series 2001-A4 All real & personal $26,480,000 SunTrust Bank property owned by Attn: Christopher Gehman the Debtor 919 East Main Street 10th Floor Richmond, VA 23219 Bonds - Series 2001-D All real & personal $25,000,000 BNP Paribas property owned by Attn: Brock Harris the Debtor 787 Seventh Avenue New York, NY 10019 Bonds - Series 2001-A1 All real & personal $5,535,000 SunTrust Bank property owned by Attn: Christopher Gehman the Debtor 919 East Main Street 10th Floor Richmond, VA 23219 Bonds - Series 2001-B All real & personal $5,000,000 SunTrust Bank property owned by Attn: Christopher Gehman the Debtor 919 East Main Street 10th Floor Richmond, VA 23219 Bonds - Series 2001-HCD Marketing, $4,100,000 Financing Authority - Development and Carlton Cove Financial Advisory City Hall Services 308 Fountain Circle Huntsville, AL 35804 Bonds - Series 2001-A2 All real & personal $4,010,000 SunTrust Bank property owned by Attn: Christopher Gehman the Debtor 919 East Main Street 10th Floor Richmond, VA 23219 Bonds - Series 2001-THC Work performed as $3,801,473 Financing Authority - general contractor Carlton Cove for construction & City Hall development. 308 Fountain Circle Huntsville, AL 35804 Bonds - Series 2001-A3 All real & personal $2,460,000 SunTrust Bank property owned by Attn: Christopher Gehman the Debtor 919 East Main Street 10th Floor Richmond, VA 23219 Bonds - Series 2001-AP Outstanding Capital $750,000 Financing Authority - Stock of Asbury Carlton Cove Place, Inc. City Hall 308 Fountain Circle Huntsville, AL 35804 Bonds - Series 2001-C All real & personal $670,000 SunTrust Bank property owned by Attn: Christopher Gehman the Debtor 919 East Main Street 10th Floor Richmond, VA 23219 Madison County Tax Assessor Madison County $350,000 100 Northside Square Ad Valorem taxes Huntsville, AL 35801 Mr. & Mrs. James C. Spillman Entrance fee $308,781 12017 Turnmeyer Drive refund Southeast Huntsville, AL 35803 Estate of Melba Ogletree Entrance fee refund $143,280 Antonia Bretch Workers compensation $7,181 claim Mary Willard Medical malpractice $1 claims (CV 2005-1648 in the Circuit Court of Madison County, Alabama) Ronald Pierce Medical malpractice $1 claims (CV 2005-1483 in the Circuit Court of Madison County, Alabama The Haskell Company Early completion $1 bonuses, deferred development fees and incidentals. CARRINGTON MORTGAGE: Fitch Rates $18.3 Million Certificates at BB+ ------------------------------------------------------------------ Fitch rates these $1.6 billion Carrington Mortgage Loan Trust, Series 2006-NC3 as: -- $1.2 billion classes A-1, A-2, A-3 and A-4 'AAA'; -- $90.0 million class M-1 certificates 'AA+'; -- $82.8 million class M-2 certificates 'AA'; -- $24.7 million class M-3 certificates 'AA-'; -- $41.4 million class M-4 certificates 'A+'; -- $30.3 million class M-5 certificates 'A'; -- $23.1 million class M-6 certificates 'A-'; -- $23.1 million class M-7 certificates 'BBB+'; -- $16.7 million class M-8 certificates 'BBB'; -- $21.5 million class M-9 'BBB-'; -- $18.3 million class M10 certificates (privately offered) 'BB+'. The 'AAA' rating on the senior certificates reflects the 25.85% total credit enhancement provided by the 5.65% class M-1, the 5.20% class M-2, the 1.55% class M-3, the 2.60% class M-4, the 1.90% class M-5, the 1.45% class M-6, the 1.45% class M-7, the 1.05% class M-8, the 1.35% class M-9, the 1.15% class M-10 and the 2.50% initial overcollateralization. All certificates have the benefit of monthly excess cash flow to absorb losses. In addition, the ratings reflect the integrity of the transaction's legal structure as well as the primary servicing capabilities of New Century Mortgage Corporation (rated 'RPS3' by Fitch). Wells Fargo Bank, N.A. will act as Trustee. As of the cut-off date, August 1, 2006, the mortgage loans have an aggregate balance of $1,592,991,978. Approximately 21.83% of the mortgage loans are interest only. The weighted average mortgage rate is approximately 8.179% and the weighted average remaining term to maturity is 357 months. The average cut-off date principal balance of the mortgage loans is approximately $215,269. The weighted average original loan-to-value ratio is 80.29% and the weighted average Fair, Isaac & Co. score is 621. The properties are primarily located in California (33.36%), Florida (11.31%) and New York (6.44%). CHARLES RIVER: Earns $25.7 Million in Period Ended July 1 --------------------------------------------------------- Charles River Laboratories International, Inc. reported net income of $25.7 million for the three months ended July 1, 2006, compared to net income of $31.9 million for the three months ended June 25, 2005. The Company reported a net loss of $74.4 million for the six months ended July 1, 2006 versus a $59.5 million net income for the six months ended June 25, 2005. The Company disclosed net sales from continuing operations increased 6.8% in the second quarter of 2006 to $267.9 million from $250.9 million in the second quarter of 2005. For the first six months of 2006, the Company's net sales from continuing operations increased by 6% to $522 million, compared to $492.3 million in the same period in 2005. The negative effect of foreign exchange reduced the Company's six-month growth rate by approximately 1.6%. "We are very pleased with the progress we achieved during the second quarter," said James C. Foster, Chairman, President and Chief Executive Officer. "Exceptional sales growth in the Preclinical Services segment, due in part to new capacity, stable pricing, an optimal study mix and improved operating efficiency, translated into stronger sales and operating income growth for the quarter. In the RMS segment, we saw improvement in Vaccine product sales and another strong quarter for our In Vitro business, however, ongoing cost reductions by several large pharmaceutical customers limited research model sales." Stock Repurchase Program The Company has a stock repurchase authorization, in place from its board of directors, for the purchase of up to $300 million of its common stock. It repurchased a total of approximately 900,000 shares at a cost of $37.5 million through June 5, 2006 stock under the authorization. In the second quarter of 2006, the Company closed the sale of $350 million of Convertible Senior Notes due in 2013. Concurrent with the sale of the notes, it repurchased approximately 3.7 million shares at a cost of $148.9 million. The Company has repurchased a total of approximately 4.6 million shares at a cost of $186.4 million. As of July 1, 2006, the Company had approximately 68.3 million shares of common stock outstanding. The Company further disclosed its intention to implement an accelerated stock repurchase program in the third quarter of 2006, where it expects to repurchase approximately $75 million of common stock leaving a balance of approximately $39 million available for repurchases under the authorization. About Charles River Charles River Laboratories International, Inc. (NYSE: CRL) sells pathogen-free, fertilized chicken eggs to poultry vaccine makers. It also offers contract staffing, preclinical drug candidate testing, and other drug development services. It also markets research models -- rats and mice bred for preclinical experiments, including transgenic "knock out" mice -- to the pharmaceutical and biotech industries. It sells its products in more than 50 countries to drug and biotech companies, hospitals, and government entities. * * * As reported in the Troubled Company Reporter on June 21, 2006 Standard & Poor's Ratings Services assigned its 'BB-' senior unsecured debt rating to Charles River Laboratories International Inc.'s $300 million 2.25% convertible senior notes due 2013. The corporate credit rating is 'BB+' and the rating outlook is positive. CHARTERMAC: Earns $4.2 Million in Second Quarter 2006 ----------------------------------------------------- CharterMac reported financial results for the second quarter and six months ended June 30, 2006. "CharterMac had two significant events occur in the second quarter of 2006, including the launch of our credit intermediation subsidiary, Centerbrook Financial LLC, and the announcement of our pending acquisition of ARCap Investors LLC," said Marc D. Schnitzer, Chief Executive Officer and President of CharterMac. "While both of these events are expected to contribute to Cash Available for Distribution in 2007, there were several significant costs associated with these transactions that impacted our financial results in the second quarter. Importantly, both transactions will result in significant cost savings to the Company going forward, as well as position the Company for stable growth in 2007 and beyond. Our core businesses performed as we had expected in the second quarter, and we believe we are well positioned to have a strong finish to the year." Financial Highlights CharterMac reported total revenues of approximately $79.2 million for the three months ended June 30, 2006. Adjusted to exclude the impact of consolidated partnerships, as discussed on the third page of this press release, total revenues were approximately $86.5 million, which represents an increase of approximately 1.2% as compared to similarly adjusted revenues of approximately $85.5 million for the three months ended June 30, 2005. For the six months ended June 30, 2006, CharterMac's total revenues were approximately $151.4 million. Adjusted to exclude the impact of consolidated partnerships, total adjusted revenues for the six months ended June 30, 2006 were approximately $163.1 million, which represents an increase of approximately 11.3% as compared to similarly adjusted revenues of approximately $146.5 million for the six months ended June 30, 2005. For the three months ended June 30, 2006, CharterMac earned net income of approximately $4.2 million, representing a decrease of 78.2% as compared to approximately $19.4 million for the three months ended June 30, 2005. On a diluted per share basis, net income was $0.05 for the three months ended June 30, 2006, representing a decrease of 84.8% as compared to $0.33 for the three months ended June 30, 2005. A significant portion of the decrease in net income was due to: (i) start-up costs associated with Centerbrook; (ii) restructuring and severance costs associated with the Company's pending acquisition of ARCap and with the transfer of the Company's loan servicing operation to Dallas, Texas. As a result of this transfer, the Company believes that it will save between $2.5 million and $3 million per year in operating costs beginning in 2007; (iii) termination fees paid to third party credit providers, incremental interest costs and the write-off of deferred financing costs associated with the re-securitization of $804 million of CharterMac multifamily revenue bonds by Centerbrook. While there were significant fees associated with the launch of Centerbrook, CharterMac believes that Centerbrook will enable the Company to lower its cost of capital going forward. Specifically, with respect to the initial re-securitization transaction, the Company was paying third party credit providers 47.9 basis points in credit intermediation fees on an annual basis and will now capture 38% of those fees through Centerbrook, resulting in $1.5 million of annual savings; (iv) a decrease in the level of equity invested by our Fund Management business due to the timing of the closing of investment funds; and (v) increased interest expense. For the six months ended June 30, 2006, CharterMac earned net income of approximately $18.9 million, representing a decrease of 44.8% as compared to approximately $34.2 million for the six months ended June 30, 2005. On a diluted per share basis, net income was $0.28 for the six months ended June 30, 2006, representing a decrease of 52.5% as compared to approximately $0.59 for the six months ended June 30, 2005. About CharterMac Based in New York, CharterMac (NYSE: CHC) through its subsidiaries, offers capital solutions to developers and owners of multifamily and commercial real estate throughout the country and quality investment products to institutional and retail investors. * * * As reported on the Troubled Company Reporter on July 18, 2006, Moody's Investors Service assigned a rating of Ba3 to the $500 million CharterMac guaranteed senior credit facility which the company is issuing to acquire ARCap Investors, LLC, a private real estate finance company specializing in high yield CMBS. In addition, Moody's assigned CharterMac a corporate family rating of Ba3. The outlook is stable. The credit facility consists of a three-year $150 million revolver and a six-year $350 million term loan. CHARTERMAC: Centerbrook Financial Closes $175 Mil. Securitization ----------------------------------------------------------------- Centerbrook Financial LLC completed its second transaction, providing a pool of credit default swaps in connection with the re-securitization of approximately $175 million of CharterMac's existing multifamily revenue bonds. Since launching at the end of June, Centerbrook has provided credit default swaps on over $979 million of CharterMac's bonds. "Centerbrook continues to build its book of business, having completed close to $1 billion of credit default swaps in our first two months of operations," said Robert D. Maum, Chief Executive Officer of Centerbrook. "We are currently working on expanding our credit intermediation capabilities and developing additional products for the affordable multifamily finance industry." About Centerbrook Centerbrook Financial LLC -- http://www.centerbrookfinancial.com/ -- provides credit intermediation products, including credit default swaps, to the affordable housing finance industry. Centerbrook Holdings LLC, which owns all of the equity interests in Centerbrook, is 90% owned by a subsidiary of CharterMac, one of the nation's leading real estate finance companies, and 10% owned by IXIS Capital Markets North America Inc., an affiliate of IXIS Corporate & Investment Bank and a member of Groupe Caisse d'Epargne, one of France's largest banks. About CharterMac Headquartered in New York City, CharterMac (NYSE: CHC) -- http://www.chartermac.com/-- through its subsidiaries, CharterMac is a full-service real estate finance company, with focus on the multifamily industry. CharterMac offers capital solutions to developers and owners of multifamily and commercial real estate throughout the country and quality investment products to institutional and retail investors. * * * As reported in the Troubled Company Reporter on July 18, 2006, Moody's Investors Service assigned a rating of Ba3 to the $500 million CharterMac guaranteed senior credit facility which the company is issuing to acquire ARCap Investors, LLC, a private real estate finance company specializing in high yield CMBS. In addition, Moody's assigned CharterMac a corporate family rating of Ba3. The outlook is stable. The credit facility consists of a three-year $150 million revolver and a six-year $350 million term loan. CHASE COMMERCIAL: Fitch Lifts Low-B Ratings on Four Class Certs. ---------------------------------------------------------------- Fitch upgrades these Chase Commercial Mortgage Securities Corp. commercial mortgage pass-through certificates, series 1999-2, as: -- $27.4 million class E to 'AAA' from 'AA+'; -- $11.7 million class F to 'AA+' from 'AA-'; -- $27.4 million class G to 'A-' from 'BBB+'; -- $7.8 million class H to 'BBB+' from 'BBB' -- $6.8 million class I to 'BBB' from 'BB+'; -- $8.8 million class J to 'BBB-' from 'BB'; -- $6.8 million class K to 'BB- from 'B+'; -- $5.9 million class L to 'B' from 'B-'. In addition, Fitch affirms the following: -- $18.9 million class A-1 at 'AAA'; -- $469.3 million class A-2, at 'AAA'; -- Interest-only class X at 'AAA'; -- $41.1 million class B at 'AAA'; -- $37.2 million class C at 'AAA'; -- $11.7 million class D at 'AAA'. The $13.6 million class M is not rated by Fitch. The rating upgrades reflect the improved credit enhancement levels as a result of loan payoffs, amortization and the additional defeasance of 3 loans (3.8%) since Fitch's last rating action. As of the July 2006 distribution date, the pool's aggregate collateral balance has been reduced approximately 11.3% to $694.6 million from $782.7 million at issuance. Loan modifications on two previously specially serviced loans have caused interest shortfalls on classes L and M. There is currently one (0.5%) loan in special servicing which is real estate owned. The asset is secured by a retail property located in Warr Acres, Oklahoma. The special servicer is in the process of obtaining a broker to list the property for sale. CHENIERE ENERGY: Posts $3.6 Million 2006 Second Quarter Net Loss ---------------------------------------------------------------- Cheniere Energy, Inc. reported a net loss of $3.6 million for the second quarter of 2006, compared to a net loss of $9.7 million during the corresponding period in 2005. The Company disclosed that the major factors contributing to the net loss during the second quarter of 2006 were charges for general and administrative expenses of $12.4 million and interest expense of $11.1 million. The Company also disclosed working capital at June 30, 2006 was $756.1 million, compared with $810.1 million at December 31, 2005. Based in Houston, Texas, Cheniere Energy, Inc., (AMEX:LNG) explores and produces oil. It also develops a liquefied natural gas receiving-terminal business. It operates a seismic database covering about 7,000 sq. mi. It also has a 9% interest in exploration and production affiliate Gryphon Exploration, which explores areas targeted by a seismic data licensed from Fairfield Industries. With proved reserves of 3,021 barrels of oil and 919.1 million cu. ft. of natural gas, it operates along the coast of Louisiana, both onshore and in the shallow waters along the Gulf of Mexico. In 2005, it acquired BPU LNG. * * * Standard & Poor's Ratings Services affirmed its 'B' corporate credit rating on Cheniere Energy Inc. and affirmed its 'BB' rating on the $600 million term B bank loan at Cheniere LNG Holdings LLC, an indirectly owned, 100% subsidiary of Cheniere Energy. The outlook is stable. CHESAPEAKE CORP: S&P Rates $125 Million Credit Facility at BB- -------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BB-' senior secured bank loan and '2' recovery ratings to Chesapeake Corp.'s proposed $125 million revolving credit facility due 2011 and GBP140 million term loan B due 2013, based on preliminary terms and conditions. At the same time, the senior unsecured debt rating was lowered to 'B' from 'B+' because of the increase in priority debt. The company's 'BB-' corporate credit rating and 'B' subordinated debt ratings were affirmed. The outlook is stable. Paperboard and plastics packaging producer Chesapeake, based in Richmond, Virginia, will use the term loan proceeds to refinance about $125 million of borrowings on its existing $250 million revolving credit facility and to redeem its GBP67 million of 10-3/8% senior subordinated notes due 2011 that become callable Nov. 15, 2006. Pro forma for the refinancing, Chesapeake had total debt, adjusted for operating leases and postretirement obligations, of about $550 million as of July 2, 2006, with total debt to last-12-month EBITDA of about 5.2x. This is a very aggressive level of debt leverage, but Standard & Poor's expects this ratio to improve toward the 4x area, an appropriate level for the current ratings, as Chesapeake realizes savings from its two- year cost-reduction program. "We expect Chesapeake's discretionary cash flow to remain weak and financial leverage to remain aggressive, given industry conditions," said Standard & Poor's credit analyst Lisa Wright. "However, these metrics should improve to levels appropriate for the current ratings as the company realizes cost savings from its two-year plan. We could revise the outlook to negative if we come to expect meaningful negative discretionary cash flow in 2007 and beyond, because of weaker industry conditions or cost pressures that may exceed the restructuring benefits, or if the company's debt leverage fails to improve to levels appropriate for the ratings." S&P expects funds from operations to total debt to improve to the 15% area as cost savings are realized. Based on actions taken to date, Chesapeake estimates that it will realize $14 million of annual savings. Given the relatively straightforward nature of its restructuring activities, S&P believes the company is likely to achieve its goal of $25 million of annual savings. CINEMARK INC: Moody's Holds Junk Rating on Senior Unsecured Notes ----------------------------------------------------------------- Moody's Investors Service affirmed the B1 corporate family rating for Cinemark, Inc., in light of the company's announced plans to acquire Century Theatres, Inc. Cinemark's B1 corporate family rating can sustain the less than one turn increase in leverage that Moody's anticipates will result from the proposed transaction. Moody's estimates the acquisition will result in incremental debt of approximately $500 million as well as the assumption of Century's existing debt. Moody's also affirmed all existing Cinemark ratings, and the outlook remains stable. Moody's took these actions: Cinemark, Inc. * Affirmed B1 Corporate Family Rating * Affirmed Caa1 Senior Unsecured Notes Rating Cinemark USA, Inc. * Affirmed Ba3 Senior Secured Bank Credit Facility Rating * Affirmed B3 Senior Subordinate Notes Rating Moody's also affirmed Century's Ba3 corporate family rating and its Ba3 senior secured bank rating. Should the transaction proceed as planned, Moody's will withdraw Century's ratings. Moody's estimates Cinemark leverage pro forma for the transaction will be in the mid 6 times range. The affirmation of the B1 corporate family rating incorporates Moody's analysis of the combined company. The B1 corporate family rating reflects high leverage, sensitivity to product from movie studios, and a weak industry growth profile, offset by expectations for continued positive free cash flow and the advantages of scale and geographic diversity. Modest upside cash flow benefits from increased advertising also support the rating. Cinemark, Inc. operates approximately 300 theaters and 3,300 screens in North America, Latin America, and South America through its Cinemark USA, Inc. and other subsidiaries. One of the largest motion picture exhibitors in North America with annual revenue of approximately $1 billion, the company maintains its headquarters in Plano, Texas. Century Theatres, Inc. operates approximately 80 theaters with 1,000 screens located primarily in the western half of the United States. The company maintains its headquarters in San Rafael, California, and its annual revenue is approximately $500 million. CINEMARK USA: Moody's Holds B3 Rating on Senior Subordinated Notes ------------------------------------------------------------------ Moody's Investors Service affirmed the B1 corporate family rating for Cinemark, Inc., in light of the company's announced plans to acquire Century Theatres, Inc. Cinemark's B1 corporate family rating can sustain the less than one turn increase in leverage that Moody's anticipates will result from the proposed transaction. Moody's estimates the acquisition will result in incremental debt of approximately $500 million as well as the assumption of Century's existing debt. Moody's also affirmed all existing Cinemark ratings, and the outlook remains stable. Moody's took these actions: Cinemark, Inc. * Affirmed B1 Corporate Family Rating * Affirmed Caa1 Senior Unsecured Notes Rating Cinemark USA, Inc. * Affirmed Ba3 Senior Secured Bank Credit Facility Rating * Affirmed B3 Senior Subordinate Notes Rating Moody's also affirmed Century's Ba3 corporate family rating and its Ba3 senior secured bank rating. Should the transaction proceed as planned, Moody's will withdraw Century's ratings. Moody's estimates Cinemark leverage pro forma for the transaction will be in the mid 6 times range. The affirmation of the B1 corporate family rating incorporates Moody's analysis of the combined company. The B1 corporate family rating reflects high leverage, sensitivity to product from movie studios, and a weak industry growth profile, offset by expectations for continued positive free cash flow and the advantages of scale and geographic diversity. Modest upside cash flow benefits from increased advertising also support the rating. Cinemark, Inc. operates approximately 300 theaters and 3,300 screens in North America, Latin America, and South America through its Cinemark USA, Inc. and other subsidiaries. One of the largest motion picture exhibitors in North America with annual revenue of approximately $1 billion, the company maintains its headquarters in Plano, Texas. Century Theatres, Inc. operates approximately 80 theaters with 1,000 screens located primarily in the western half of the United States. The company maintains its headquarters in San Rafael, California, and its annual revenue is approximately $500 million. CITIZENS COMMS: Earns $101 Million in Quarter Ended June 30 ----------------------------------------------------------- For the three months ended June 30, 2006, Citizens Communications Company reported a $101,702,000 net income available to common stockholders out of $506,912,000 in revenues. The Company's balance sheet at June 30, 2006 showed total assets of $6,145,297,000 and total liabilities of $5,220,899,000 resulting to a total stockholders' equity of $924,398,000. A full-text copy of the Company's financial report for the quarter ended June 30, 2006 is available for free at: http://researcharchives.com/t/s?f35 Based in Stamford, Conn., Citizens Communications Corporation (NYSE:CZN) -- http://www.czn.net/-- is a communications company providing services to rural areas and small and medium-sized towns and cities as an incumbent local exchange carrier, or ILEC. The Company offers its ILEC services under the "Frontier" name. * * * In May 2006, Moody's Investors Service placed the debt ratings of Citizens Communications' on review for possible upgrade, reflecting the company's increased commitment to maintain a stable and predictable debt profile. Affected ratings include the Ba3 ratings of the Company's Corporate family rating, Senior unsecured revolving credit facility, and Senior unsecured notes, debentures, bonds. These ratings were placed on review for possible upgrade. CMS ENERGY: Moody's Upgrades Corp. Family & Senior Debt Ratings --------------------------------------------------------------- Moody's Investors Service upgraded the debt ratings of CMS Energy. The ratings upgraded include CMS Energy's Corporate Family Rating to Ba1 from Ba3 and its senior unsecured debt to Ba3 from B1. CMS Energy's SGL-2 rating is unchanged. The outlook is stable. The rating action concludes the review for possible upgrade that was initiated on June 28, 2006. The upgrade of CMS Energy's ratings reflects the improving trend in the company's financial and business risk profile. The upgrade also incorporates the expectation for additional improvement in financial performance over the next several years. For example, the ratio of adjusted funds from operations to debt is expected to improve to about13% over the next three years due to the benefits of higher electric and gas base rates at the regulated utility subsidiary and continued gradual debt reduction at the parent company level. Business risk has been reduced as the company has narrowed the scope of its operations to focus on regulated utility subsidiary Consumers Energy. The recent announcement regarding the sale of the Midland Cogeneration Venture project continues an ongoing trend of divesting or scaling back underperforming and non- regulated assets and is expected to improve earnings and reduce cash flow volatility. With non-regulated assets reduced to about 10% of consolidated assets after the MCV transaction closes, the business risk profile and cash flow of the parent company will mainly reflect the regulated utility operations. The upgrade further recognizes perceived improvements in corporate governance, risk management practices, and liquidity management. The ratings and stable outlook incorporate the expectation that Consumers will benefit from relatively timely recovery of fuel and purchased power costs through the annual power supply cost recovery mechanism, including the recovery of purchased power that is necessary to meet the portion of its load requirements that exceed its internal generation capability. The ratings also incorporate the expectation that the company will receive timely recovery of gas inventory costs in its natural gas distribution business through the annual gas cost recovery mechanism. Based in Jackson, Michigan, CMS Energy Corporation is a diversified energy holding company. Through its regulated utility subsidiary, Consumers Energy, the company provides natural gas and electricity to almost 60% of nearly 10 million customers in Michigan's lower peninsula counties. Upgrades: Issuer: CMS Energy Corporation * Corporate Family Rating, Upgraded to Ba1 from Ba3 * Preferred Stock, Upgraded to B3 from Caa1 * Preferred Stock Shelf, Upgraded to (P)B3 from (P)Caa1 * Senior Secured Bank Credit Facility, Upgraded to Ba2 from Ba3 * Senior Unsecured Conv./Exch. Bond/Debenture, Upgraded to Ba3 from B1 * Senior Unsecured Medium-Term Note Program, Upgraded to Ba3 from B1 * Senior Unsecured Regular Bond/Debenture, Upgraded to Ba3 from B1 * Senior Unsecured Shelf, Upgraded to (P)Ba3 from (P)B1 * Subordinated Conv./Exch. Bond/Debenture, Upgraded to B2 from B3 * Subordinated Shelf, Upgraded to (P)B2 from (P)B3 Issuer: CMS Energy Trust I * Preferred Stock, Upgraded to B2 from B3 * Preferred Stock Shelf, Upgraded to (P)B2 from (P)B3 Issuer: CMS Energy Trust II * Preferred Stock Shelf, Upgraded to (P)B2 from (P)B3 Issuer: CMS Energy Trust III * Preferred Stock Shelf, Upgraded to (P)B2 from (P)B3 Issuer: CMS Energy Trust IV * Preferred Stock Shelf, Upgraded to (P)B2 from (P)B3 Issuer: CMS Energy Trust V * Preferred Stock Shelf, Upgraded to (P)B2 from (P)B3 Outlook Actions: Issuer: CMS Energy Corporation * Outlook, Changed To Stable From Rating Under Review Issuer: CMS Energy Trust I * Outlook, Changed To Stable From Rating Under Review Issuer: CMS Energy Trust II * Outlook, Changed To Stable From Rating Under Review Issuer: CMS Energy Trust III * Outlook, Changed To Stable From Rating Under Review Issuer: CMS Energy Trust IV * Outlook, Changed To Stable From Rating Under Review Issuer: CMS Energy Trust V * Outlook, Changed To Stable From Rating Under Review COEUR D'ALENE: Invests $60 Million on San Bartolome Silver Mine --------------------------------------------------------------- A spokesperson of Coeur D'Alene Mines Corp. told Business News Americas that the firm will invest $60 million in the second half of 2006 on the construction of its $135 million San Bartolome silver mine. As reported in the Troubled Company Reporter-Latin America on July 18, 2006, Coeur said it would start the construction of the mine. The initial phase of the construction would be on a silver-processing plant in Potosi, in the southwest region of Bolivia, which the mines ministry dubs as the "start of the reactivation of the mining sector." Coeur estimated that the project would start producing the projected 8 million ounces of silver per year by the end of 2007, as planned. The Bolivian government said that the San Bartolome mine would increase its assistance to the city's 120,000 residents, as it would process the metals gathered by seven mining companies in Potosi. "In the second half of the year we anticipate spending levels to pick up rapidly to something like $60 million. We have been in the construction phase for some time but it has been at a fairly modest level of activity," BNamericas relates, citing Scott Lamb -- a Coeur spokesperson. Meanwhile, Coeur had disclosed that it successfully restructured a lease contract for one of the San Bartolome properties its leases from Corporacion Minera de Bolivia, Bolivia's state-run mining company, BNamericas notes. Mr. Lamb told BNamericas, "We think [the restructuring] is indicative of our ability to work productively and cooperatively with the government and is part of an ongoing process in which we continue to develop relationships with it." Mr. Lamb said Coeur is "seeing very encouraging signs" from the Bolivian government and has even received assurances on the secure status of San Bartolome, BNamericas notes. Coeur d'Alene Mines Corp. -- http://www.coeur.com/-- is the world's largest primary silver producer, as well as a significant, low-cost producer of gold. The Company has mining interests in Nevada, Idaho, Alaska, Argentina, Chile, Bolivia and Australia. * * * Coeur d'Alene Mines Corporation's $180 Million notes due Jan. 15, 2024, carry Standard & Poors' B- rating. COMM 2004-LNB2: Fitch Holds Low-B Ratings on Six Classes -------------------------------------------------------- Fitch Ratings affirms COMM 2004-LNB2 as: -- $44 million class A-1 at 'AAA'; -- $129.5 million class A-2 at 'AAA'; -- $157.6 million class A-3 at 'AAA'; -- $466.5 million class A-4 at 'AAA'; -- Interest only class X-1 at 'AAA'; -- Interest only class X-2 at 'AAA'; -- $25.3 million class B at 'AA'; -- $9.6 million class C at 'AA-'; -- $19.3 million class D at 'A'; -- $8.4 million class E at 'A-'; -- $9.6 million class F at 'BBB+'; -- $10.8 million class G at 'BBB'; -- $10.8 million class H at 'BBB-'; -- $4.8 million class J at 'BB+'; -- $6.0 million class K at 'BB'; -- $3.6 million class L at 'BB-'; -- $4.8 million class M at 'B+'; -- $2.4 million class N at 'B'; -- $1.2 million class O at 'B-'. Fitch does not rate the $12.6 million class P. The affirmations are the result of minimal paydown since issuance and stable performance. As of the August 2006 distribution date, the pool has paid down 3.74% to $927.1 million from $963.8 million at issuance. In addition, three loans, 4.8% of the pool, have defeased. There are currently two specially serviced loans (1.2%). Both loans are multifamily properties that were significantly impacted by Hurricane Katrina. One of the properties (0.8%), located in New Orleans, Louisiana, was completely destroyed. The borrower is currently in negotiations with the insurance company regarding the insurance coverage and proceeds. The borrower has used proceeds to pay down the debt and keep the loan current; however, if additional proceeds are not received, losses are possible. The other property (0.4%), located in Biloxi, Mississippi, was heavily damaged; however, the borrower is using insurance proceeds to keep the loan current during renovations. Three loans have investment grade credit assessments: Tyson's Corner Center (15.8%), AFR Office Portfolio (8%) and Meadows Mall (5.8%). Based on their stable performance the loans maintain investment grade credit assessments. The Fitch stressed debt service coverage ratio is calculated based on a Fitch adjusted net cash flow and a stressed debt service based on the current loan balance and a hypothetical mortgage constant. Tyson's Corner Center is secured by a 1.6 million square foot (sf) regional mall in McLean, Virginia. There are four pari passu notes, A-1 through A-4. A-1 is included in the trust. For year end (YE) 2005 the Fitch stressed DSCR has increased to 1.82 times (x) from 1.53x at issuance. Occupancy as of YE 2005 has improved to 97.7% from 95.9% at issuance. The AFR office portfolio is secured by 153 properties located across 19 states. The total debt on the portfolio consists of an A-1, A-2, A-3, A-4 and a B-note. The A-3 note is included in the trust. The Fitch stressed DSCR for YE 2005 is 1.58x compared to 1.79x at issuance. Occupancy as of YE 2005 is 85.8% compared to 86.4% at issuance. The Meadows Mall is secured by a 312,210 sf regional mall in Las Vegas, Nevada. The note is split into two equal pari passu pieces with the A-2 piece included in the trust. As of YE 2005 the Fitch stressed DSCR has increased to 1.48x from 1.39x at issuance. Occupancy as of YE 2005 is 93% compared to 96.6% at issuance. COMMSCOPE INC: Backs Out on Proposed Andrew Corp. Acquisition ------------------------------------------------------------- CommScope, Inc. responded to Andrew Corporation's rejection of its proposal to acquire all of Andrew's outstanding shares for $9.50 per share in cash: "We are disappointed that Andrew has decided to reject our proposal. After careful consideration with our advisors, CommScope has decided not to pursue its proposal to acquire Andrew Corporation at the present time. CommScope's operational excellence and financial discipline has made us a global leader in the 'last mile' of telecommunications. We intend to continue building upon our leadership position and we are confident that CommScope is poised to continue creating value for its stockholders." About Andrew Corporation Based in Westchester, Illinois, Andrew Corporation (Nasdaq: ANDW) -- http://www.andrew.com/-- designs, manufactures, and delivers innovative and essential equipment and solutions for the global communications infrastructure market. The company serves operators and equipment manufacturers from facilities in 35 countries. The Company is an S&P 500 company founded in 1937. About CommScope Based in Hickory, North Carolina, CommScope, Inc. (NYSE:CTV) -- http://www.commscope.com/-- designs and manufactures "last mile" cable and connectivity solutions for communication networks. Through its SYSTIMAX(R) Solutions(TM) and Uniprise(R) Solutions brands CommScope is the global leader in structured cabling systems for business enterprise applications. It is also the world's largest manufacturer of coaxial cable for Hybrid Fiber Coaxial applications. Backed by strong research and development, CommScope combines technical expertise and proprietary technology with global manufacturing capability to provide customers with high-performance wired or wireless cabling solutions. * * * As reported in the Troubled Company Reporter on Aug. 10, 2006, Moody's Investors Service placed the ratings of CommScope, Inc. on review for possible downgrade following its report that it placed an all cash bid to acquire Andrew Corporation for $1.7 billion. This bid is a competing offer set to expire Aug. 11, 2006, with a 36% premium to that outstanding by ADC Telecommunications Inc. Moody's estimates that pro forma for the acquisition prior to cost savings from synergies, Commscope's financial leverage as measured by debt to TTM June 2006 EBITDA adjusted for capitalized operating leases would be increased from about 2.2x to more than 5x, which could potentially result in a multiple notch downgrade. Ratings under review for downgrade include the Ba2 corporate family rating and B1 rating of its $250 million senior subordinated note due 2024. As reported in the Troubled Company Reporter on Aug. 9, 2006, Standard & Poor's Ratings Services has placed its 'BB' corporate credit and 'B+' subordinated debt ratings of CommScope Inc. on CreditWatch with negative implications. The action reflects CommScope's offer to acquire Andrew Corp. for $1.7 billion in cash. This offer represents a 36% premium to the existing stock offer for Andrew by unrated Eden Prairie, Minn.-based ADC Telecommunications Inc. CONSTELLATION BRANDS: Moody's Rates $500 Million Sr. Notes at Ba2 ----------------------------------------------------------------- Moody's Investors Service assigned a (P)Ba2 rating to Constellation Brands, Inc.'s new shelf and concurrently, a Ba2 rating to Constellation's new $500 million senior unsecured note, due 2016. Constellation's existing ratings are not affected by these actions, and have been affirmed. The ratings outlook remains negative. The notes will be fully and unconditionally guaranteed by the subsidiaries that are guarantors under Constellation Brands senior bank credit facility. Proceeds from the debt issuance are to be used to reduce a corresponding amount of borrowings under the revolver and permanent reduction in term loans. Moody's assessment of Constellation's liquidity remains unchanged given that free cash flow is expected to be pressured throughout the next twelve months thus offsetting the benefits of the refinancing. Moody's previous rating action on Constellation was the June 15, 2006 rating affirmation and assignment of bank facility ratings Following the Vincor acquisition. Constellation's ratings remain constrained by its aggressive acquisition strategy, which gives rise to considerable integration and event risk and high pro forma financial leverage. Offsetting these risks are Constellation's scale and market diversification, its broad portfolio of brands covering the wine, spirits and imported beer categories at all price points, franchise strength and growth potential, and solid profitability and efficiency. The ratings also consider the company's demonstrated ability to quickly integrate acquisitions, repay debt and restore credit metrics. Leverage improvement following the most recent acquisition will be further delayed due to the company's recently announced restructuring program, which will reduce cash flow due to one time cash charges of approximately $40 million and increased capital spending of approximately $25 million. These projects are expected to reduce net operating expenses by approximately $5 million in fiscal 2008 and by more than $15 million annually beginning in fiscal 2009. Despite the shortfall in expected free cash flow to debt levels, the ratings affirmation reflects Moody's belief that such tightening should be temporary given the longer term benefit of the announced restructuring plan. The negative ratings outlook continues to reflect Moody's concern about Constellation's aggressive acquisition strategy, integration risk, and the resulting pressures on its financial and business profile. Any further deviation from current financial or strategic expectations could result in a downgrade of the ratings. Upward rating movement -- absent an exogenous event -- is unlikely at this time. Stabilization of the outlook could result over time from evidence that the company has successfully integrated Vincor, sufficiently paid down debt and is committed to sustained levels of improved credit metrics. Ratings assigned: Shelf ratings: * Senior unsecured at (P)Ba2 * Subordinated at (P)Ba3 * Preferred stock at (P)B1 * Ba2 for the $500 million senior unsecured debt issuance due 2016 Ratings affirmed: * $3.5 billion secured bank credit facilities consisting of a $1.2 billion Term Loan A due June 2011, a $1.8 billion Term Loan B due June 2013, and a $500 million revolving credit facility due June 2011$3.5 billion senior secured bank facilities; Ba2 * $200 million 8% senior unsecured notes, due 2008, Ba2 * GBP80 million 8.5% senior unsecured notes, due 2009, Ba2 * GBP75 million 8.5% senior unsecured notes, due 2009, Ba2 * $250 million 8.125% senior subordinated notes, due 2012, Ba3 * Ba2 Corporate Family Rating * The SGL-2 Speculative Grade Liquidity rating Headquartered in Fairport, New York, Constellation Brands, Inc. is a leading international producer and marketer of beverage alcohol brands with a broad portfolio across the wine, spirits, and imported beer categories. For the fiscal year ended February 28, 2006, consolidated net revenue was approximately $4.6 billion. Vincor International Inc. is one of the world's top ten wine companies with revenue for the twelve months ended December 31, 2005 exceeding CDN$724 million. CT CDO: Fitch Affirms Low-B Ratings on Six Class Certificates ------------------------------------------------------------- Fitch affirms these CT CDO III Ltd., a collateralized debt obligation as: -- $61.0 million class A-1 at 'AAA'; -- $147.2 million class A-2 at 'AAA'; -- $29.0 million class B at 'AA'; -- $13.7 million class C 'A'; -- $5.1 million class D at 'A-'; -- $6.8 million class E at 'BBB+'; -- $6.8 million class F at 'BBB'; -- $9.8 million class G at 'BBB-'; -- $11.5 million class H at 'BB+'; -- $6.8 million class J at 'BB'; -- $3.8 million class K at 'BB-'; -- $5.1 million class L at 'B+'; -- $5.5 million class M at 'B'; -- $4.3 million class N at 'B-'; Classes O, X and the Preferred Shares class are not rated by Fitch. The affirmations are the result of minimal changes the ratings of the underlying securities, as well as the stable credit enhancement levels. There has been no principal paydown and no losses since issuance. The certificates are collateralized by all or a portion of 23 classes of fixed rate CMBS in 15 separate underlying CMBS transactions. The weighted average rating factor is 19.4 (BB- /B+), stable from issuance. The classes' ratings are based on Fitch's actual rating, or on Fitch's internal credit assessment for those classes not rated by Fitch. Delinquencies in the underlying transactions are: * 30 days (0.1%); * 60 days (0.0%); * 90 days or more (0.3%); * foreclosure (0.4%) and * REO (0.3%). DA VINCI: Voluntary Chapter 11 Case Summary ------------------------------------------- Debtor: Da Vinci Food Service, Inc. 52-C Green Pond Road Rockaway, New Jersey 07866 Bankruptcy Case No.: 06-17380 Chapter 11 Petition Date: August 9, 2006 Court: District of New Jersey (Newark) Debtor's Counsel: John O'Boyle, Esq. Stern, Lavinthal, Frankenberg & Norgaard 184 Grand Avenue Englewood, New Jersey 07631 Tel: (201) 871-1333 Fax: (201) 871-3161 Estimated Assets: Unknown Estimated Debts: Unknown The Debtor did not file a list of its 20 Largest Unsecured Creditors. DELPHI CORP: American Axle CEO Downplays Plan to Buy Delphi Parts ----------------------------------------------------------------- American Axle & Manufacturing Holdings Inc. may be interested in acquiring certain of Delphi Corporation's businesses. Some parts of Delphi would fit with American Axle's business model, Richard Dauch, CEO of American Axle, told the Detroit Free Press before a speech at the Management Briefing Seminars in Traverse City, Michigan. "We could bolt them on to us," Mr. Dauch said, according to Free Press. However, Mr. Dauch refused to elaborate on his interest in the bankrupt auto-parts supplier. Mr. Dauch also said he hopes Delphi reaches a resolution with General Motors Corp. and its unions, Free Press writer Jason Roberson relates. American Axle supplies driveline systems and related powertrain components and chassis modules for light trucks, sport utility vehicles, and passenger cars and crossover vehicles. Both companies were once part of GM. American Axle got separated through an asset purchase while Delphi was spun off. Based in Troy, Mich., Delphi Corporation -- http://www.delphi.com/ -- is the single largest global 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. 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, represents the Official Committee of Unsecured Creditors. As of Aug. 31, 2005, the Debtors' balance sheet showed $17,098,734,530 in total assets and $22,166,280,476 in total debts. (Delphi Bankruptcy News, Issue No. 36; Bankruptcy Creditors' Service, Inc., 215/945-7000, http://bankrupt.com/newsstand/) DELPHI CORP: Hires 290 Temporary Workers for Lockport Plant ----------------------------------------------------------- Delphi Corporation has hired 290 workers for its plant in Lockport, New York, to fill an upcoming void in January, WIVB.com says. More than 1,100 of Delphi's veteran workers who have participated in the attrition program will be leaving by January. The Buffalo News relates that 200 temporary workers started training on July 10, and another 90 started on July 17. The people were referred by existing workers and from the state Labor Department's job pool, says Buffalo News, citing Paul Siejak, president of United Auto Workers Local 686, Unit 1. More temps are likely on the way, Delphi Spokesman Lindsey Williams said, according to Buffalo News. According to WIVB.com, the new hires will be paid about $14 per hour, which is about half of the wage of regular union workers at the plant. "There are a lot of people earning $7-$8 an hour out there -- for these people, it's not a pay cut," Lockport Mayor and retired Delphi worker Michael Tucker told Buffalo News. Based in Troy, Mich., Delphi Corporation -- http://www.delphi.com/ -- is the single largest global 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. 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, represents the Official Committee of Unsecured Creditors. As of Aug. 31, 2005, the Debtors' balance sheet showed $17,098,734,530 in total assets and $22,166,280,476 in total debts. (Delphi Bankruptcy News, Issue No. 36; Bankruptcy Creditors' Service, Inc., 215/945-7000, http://bankrupt.com/newsstand/) DELTA PETROLEUM: S&P Junks Rating on $150 Million Senior Notes -------------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'B-' corporate credit rating on exploration and production company Delta Petroleum Corp. At the same time, Standard & Poor's lowered its rating on the company's $150 million senior notes due 2015 to 'CCC+' from 'B-'. The outlook remains stable. As of June 30, 2006, Denver, Colorado- based Delta had $224 million in debt. The upward revision of the borrowing base on Delta's credit facility to $120 million from $75 million prompted the downgrade of the unsecured notes. Assuming a fully drawn credit facility, Delta's priority debt exceeds 15% of the book value of the company's assets, which is our guideline for lowering a debt class rating by one notch relative to the corporate credit rating. "Delta's business risk profile is vulnerable, reflecting its small reserve base, high cost structure, and an aggressive capital- expense program, as it seeks to diversify away from its Gulf Coast properties," said Standard & Poor's credit analyst Paul Harvey. "At the current rating level, these weaknesses are partially mitigated by Delta's solid reserve life, high operatorship of its properties, and good reserve replacement," said Mr. Harvey. The stable outlook on Delta reflects expectations that the company will continue to improve its liquidity and expand production in the near term. Delta is a small, independent exploration and production company with year-end Dec. 31, 2005 proved reserves of 269 billion cubic feet equivalent. DIVERSIFIED REIT: Fitch Holds Low-B Ratings on Three Class Notes ---------------------------------------------------------------- Fitch Ratings affirms all classes of notes issued by Diversified REIT Trust 1999-1 Ltd./Corp. (DREIT 1999-1). These rating actions are effective immediately: -- $104,075,367 class A-1 at 'AAA'; -- $210,131,833 class A-2 at 'AAA'; -- $31,125,600 class B at 'AAA'; -- $31,125,600 class C at 'AAA'; -- $41,500,800 class D at 'A+'; -- $23,344,200 class E at 'BBB-'; -- $5,187,600 class F at 'BB'; -- $7,781,400 class G at 'BB-'; -- $5,187,600 class H at 'B'; -- Class X (interest only) at 'AAA'. DREIT 1999-1 is a collateralized debt obligation which closed May 26, 1999. DREIT 1999-1 is composed of a static pool of senior unsecured real estate investment trust securities. Fitch has reviewed the credit quality of the individual assets comprising the portfolio. The rating affirmations reflect the continued stable performance of the collateral since closing. The weighted average rating factor has reduced slightly to 6.64 as of Aug. 7, 2006 compared to 6.76 at last rating review. Since the last review, the portfolio assets have experienced a similar amount of credit upgrades as credit downgrades. The weighted average coupon has also remained stable and is currently at 7.36%. The seasoning of the collateral can be illustrated by the declining weighted average life. The WAL of the portfolio declined to 1.65 years as of Aug. 7, 2006 versus 2.51 years at last review. The notes pay principal in sequential order and there are no over- collateralization or interest coverage tests. There are currently no defaulted assets in the portfolio. Fitch will continue to monitor and review this transaction for future rating adjustments. DIVERSIFIED REIT: Fitch Lifts Ratings on $13.64 Mil. Class Notes ---------------------------------------------------------------- Fitch Ratings upgrades six classes and affirms four classes of notes issued by Diversified REIT Trust 2000-1 Ltd./Corp. (DREIT 2000-1). These rating actions are effective immediately: -- $18,300,000 class A-1 'AAA'; -- $145,836,000 class A-2 'AAA'; -- $18,090,000 class B 'AAA'; -- $26,992,000 class C upgrade to 'AAA' from 'AA'; -- $21,249,000 class D upgrade to 'AA-' from 'A'; -- $11,343,000 class E upgrade to 'BBB+' from 'BBB'; -- $4,307,000 class F upgrade to 'BB+' from 'BB'; -- $5,025,000 class G upgrade to 'BB' from 'BB-'; -- $4,308,000 class H upgrade to 'B+' from 'B'; -- class X notes (interest only) 'AAA'. DREIT 2000-1 is a collateralized debt obligation which closed April 13, 2000, composed of a static pool of senior unsecured real estate investment trust securities. The upgrades are driven primarily by the improved credit quality, seasoning of the collateral, and deleveraging of the transaction. Since last review, the percentage of portfolio assets having experienced credit upgrades outweighs the percentage of downgrades. The weighted average rating factor has improved to 5.65 as of August 4, 2006 from 6.14 at last review. The weighted average coupon remains relatively stable at 7.68%. The notes pay principal in sequential order and there are no over- collateralization or interest coverage tests. There are currently no defaulted assets in the portfolio. Fitch will continue to monitor and review this transaction for future rating adjustments. DLJ COMMERCIAL: Fitch Cuts Rating on $9.7 Mil. Certificates to B- ----------------------------------------------------------------- Fitch Ratings downgrades DLJ Commercial Mortgage Corp.'s commercial mortgage pass-through certificates, series 2000-CKP1, as: -- $9.7 million class B-6 to 'B-' from 'B'. Fitch upgrades these classes: -- $58 million class A-3 to 'AAA' from 'A+'; -- $16.1 million class A-4 to 'AAA' from 'A'; -- $16.1 million class B-1 to 'AA' from 'A-'; -- $25.8 million class B-2 to 'A' from 'BBB'; -- $12.9 million class B-3 to 'BBB+' from 'BBB-'. In addition, Fitch affirms: -- $785.7 million class A-1B at 'AAA'; -- Interest-only class S at 'AAA'; -- $51.6 million class A-2 at 'AAA'; -- $33.9 million class B-4 at 'BB+'; -- $17.7 million class B-5 at 'BB'. The $9.7 million class B-7 certificates remain at 'CC/DR4'. The balances of the classes B-8, B-9 and C certificates have been reduced to zero due to realized losses. The rating downgrade is the result of increased Fitch Loans of Concern since the last ratings action. Fitch LOC total 17.7% of the outstanding balance and include the specially serviced assets (3.5%) and loans with low debt service coverage ratios and occupancies. The rating upgrades are the result of increased subordination levels resulting from loan payoffs, amortization, as well as defeasance since Fitch's last rating action. As of the July 2006 distribution date, the pool has paid down 19.8% to $1.03 billion from $1.29 billion at issuance. In addition, 28 loans (20.7%) have defeased, including three of the top 10 loans (8.9%). Five assets (3.5%) are currently in special servicing: one real estate owned (REO) property (0.12%), one loan that is 90 days delinquent (0.48%), and three loans that are current (2.9%). The three current loans (2.9%) are multifamily properties with a total of 732 units in Colorado Springs, Colorado. All three loans are expected to payoff in September 2006. The 90-day delinquent loan (0.48%) is a multifamily property located in Memphis, Tennessee. The special servicer is pursuing foreclosure. The REO asset (0.12%) is a self storage facility located in Hamilton, Ohio. The special servicer is working to stabilize the property and has listed it for sale. Fitch expects losses on the specially serviced loans, however, such losses are expected to be absorbed by the class B-7 certificate. Fitch reviewed the credit assessment of the 437 Madison Avenue loan (8.1%). The 437 Madison Avenue loan is secured by a 782,921- square foot office property in midtown Manhattan. The Fitch stressed DSCR for the loan remains strong at 2.58 times (x) for year-end 2005 compared to 2.01 for YE 2004 and 1.65x at issuance. The property is currently 99.2% occupied. The Fitch stressed DSCR for the loan is calculated using Fitch adjusted net cash flow divided by a Fitch stressed debt service payment. Based on its improved performance, the loan maintains an investment grade credit assessment. DLJ COMMERCIAL: Fitch Holds Low-B Ratings on $20.2 Mil. Certs. -------------------------------------------------------------- Fitch Ratings upgrades these DLJ Commercial Mortgage Corp. mortgage pass-through certificates, series 1999-CG3 as: -- $27.0 million class B-3 certificates to 'A+' from 'A'. In addition, Fitch affirms these classes: -- $14.2 million class A-1A at 'AAA'; -- $509.1 million class A-1B at 'AAA'; -- $17.7 million class A-1C at 'AAA'; -- Interest-only class S at 'AAA'; -- $25.0 million class A-2 at 'AAA'; -- $49.5 million class A-3 at 'AAA'; -- $13.5 million class A-4 at 'AAA'; -- $15.7 million class A-5 at 'AAA'; -- $18.0 million class B-1 at 'AAA'; -- $15.7 million class B-2 at 'AAA'; -- $13.5 million class B-4 at 'BBB+; -- $9.0 million class B-5 at 'BBB-'; -- $11.2 million class B-6 at 'BB'; -- $9.0 million class B-7 at 'B-'. -- $9.0 million class B-8 remains 'CC/DR5'; -- $2.8 million class C remains 'C/DR6'. The upgrade is a result of the additional loan payoffs and scheduled amortization as well as the additional defeasance of four loans (7%) since Fitch's last rating action. Since issuance, 29 loans representing 38.2% of the pool have defeased. As of the July 2006 distribution date, the pool's aggregate certificate balance has been reduced approximately 15.5% to $760.0 million from $899.2 million at issuance. There are currently five loans (2.2%) in special servicing. The largest loan (1.2%) is secured by a 183,849 square foot office property located in Richmond, Virginia. The loan transferred to the special servicer due to monetary default. The borrower has agreed to a deed in lieu of foreclosure, pending a clear environmental report. Based on recent appraisal valuations, losses are expected upon the disposition of this asset. The second largest loan in special servicing (0.6%) is secured by a hotel property located in Indianapolis, Indiana. The property transferred to the special servicer due to imminent default. The Holiday Inn flag expired in September 2005 and the borrower was unable to make the required PIP repairs. The special servicer is proceeding with foreclosure. DPAC TECHNOLOGIES: Posts $296,000 Net Loss in 2006 Second Quarter ----------------------------------------------------------------- DPAC Technologies Corp., reported its results for the second quarter ended June 30, 2006. These results include the combined operations of DPAC Technologies Corp. and QuaTech, Inc. which combined on February 28, 2006. As a result of the merger, QuaTech has become a wholly-owned subsidiary of DPAC. For accounting purposes, the transaction is considered a "reverse merger" under which QuaTech is considered the acquirer of DPAC. Accordingly, the purchase price was allocated among the fair values of the assets and liabilities of DPAC, while the historical results of QuaTech are reflected in the results of the combined company. The results of operations are those of QuaTech prior to the merger date, and combined QuaTech and DPAC after the merger date of February 28, 2006. Second Quarter Operating Results For the second quarter of 2006, net sales were $3.5 million from net sales of $2.6 million in the second quarter of 2005, and up 9% from net sales of $3.2 million in the first quarter of 2006. Net sales related to the Company's Device Connectivity products increased by $200,000 and net sales related to the Company's Device Networking products, including the Airborne(TM) wireless product line, increased by $733,000 over the quarter ended June 30, 2005. The Company reported an operating profit of $97,000 as compared to $302,000 for the second quarter of 2005 and an operating loss of $52,000 for the first quarter of 2006. The Company's net loss for the current year second quarter totaled $296,000 as compared to net income of $92,000 for the prior year's second quarter, and a net loss of $246,000 for the first quarter of 2006. Total operating expenses incurred in the second quarter of 2006 of $1.5 million increased by $600,000 over the previous year period. The increase was the result of incremental costs, primarily personnel related, in Sales & Marketing of $126,000 and R&D of $112,000, incurred to support the Airborne wireless product line; amortization expense of $122,000 for intangible assets acquired in the merger; and an increase in General & Administrative expenses of $254,000. Interest expense of $382,000 for second quarter of 2006 included non-cash charges totaling $219,000, for the amortization of deferred financing costs and the accretion of success fees and discount on the subordinated debt. Additionally, the company recorded a non-cash charge of $163,000 for the accretion of the liability for warrants. Six Months Operating Results Net sales for the first six months of 2006 were $6.7 million, up 47% from net sales of $4.5 million in the same period of 2005. Net sales related to the Company's Device Connectivity products increased $928,000 and net sales related to the Company's Device Networking products, including the Airborne wireless product line, increased by $1.2 million over the six months ended June 30, 2005. The Company reported an operating profit of $45,000 as compared to $335,000 for the 2005 period. The Company's net loss for the current year period totaled $543,000 as compared to net income of $11,000 for the prior year period. Interest expense of $715,000 for the first six months of 2006 included non-cash charges totaling $393,000, for the amortization of deferred financing charges discounts and the accretion of success fees and discount on the subordinated debt. Additionally, the company recorded a non-cash charge of $164,000 for the accretion of the liability for warrants. Balance Sheet Summary At June 30, 2006, the Company had total assets of $13.2 million, including cash and cash equivalents of $28,000. This compares to total assets of $7.6 million at December 31, 2005, which included $11,000 in cash and cash equivalents. As a result of the merger, the Company recorded goodwill and intangible assets of approximately $5.1 million. Going Concern Doubt Moss Adams, LLP, expressed substantial doubt about DPAC Technologies' ability to continue as a going concern after it audited the Company's financial statements for the fiscal year ended Feb. 28, 2005. The auditing firm points to the Company's continuing losses from operations and negative operating cash flow. The Company's former independent auditor, Deloitte & Touche, LLP, had issued a clean and unqualified opinion after auditing the Company's financial statements for the fiscal years ended June 30, 2004 and 2003. About DPAC Technologies DPAC Technologies Corp., fka Dense-Pac Microsystems, Inc. (OTCBB:DPAC) -- http://www.dpactech.com/-- provides wireless connectivity products for industrial, transportation, medical and other commercial applications. The Airborne(TM) wireless Local Area Network Node Module was introduced in September 2003 after an initial year of research and development. The product is designed to enable OEM equipment designers to incorporate 802.11 wireless LAN connectivity into their device, instrument or equipment through the inclusion of the Company's Wireless LAN Node Module in their system design. The Company also sells Airborne(TM) Direct plug-and-play wireless products that add 802.11 wireless connectivity to legacy instruments and equipment that have a pre- existing serial or Ethernet data port. EAGLEPICHER HOLDINGS: Court OKs Adequacy of Environmental Trusts ---------------------------------------------------------------- The Hon. J. Vincent Aug, Jr. of the U.S. Bankruptcy Court for the Southern District of Ohio, Western Division, ruled on the adequacy of EaglePicher Holdings, Inc., and its debtor-affiliates' proposed funding for the Urbana Custodial Trust and Sidney Custodial Trust. Judge Aug found that the Debtors have proposed a plan that complies with statutory requirements and is not forbidden by law. Judge Aug rejected the Environmental Protection Agency's arguments to the contrary. The Debtors own sixteen properties with various environmental problems. Initially, the Debtors proposed to simply abandon these properties as burdensome to the estate. This proposal was met with fierce opposition from federal and state environmental regulatory agencies. The Debtors then proposed to transfer the properties to various Custodial Trusts, with each Custodial Trust being funded to a level acceptable to the appropriate agencies. The parties were able to agree on the amount of funding for all but two sites, one in Urbana, Ohio, and the other in Sidney, Ohio. The Debtors proposed to fund the Urbana Custodial Trust with $45,000 and the Sidney Custodial Trust with $900,000. The EPA proposed an amount of $1,842,720 for the Urbana Custodial Trust and a range of $5,855,256 to $9,330,420 for the Sidney Custodial Trust. Judge Aug said that the Debtors bear the ultimate burden of proof on this issue. As to the specific issue of whether the Custodial Trusts are adequately funded, the parties differ sharply on the legal standard to be applied. The EPA contends that the funding amounts must allow for the Custodial Trustee to bring each site "into compliance" with state and federal laws. The Debtors contended that the EPA must prove that the sites pose an "imminent and identifiable harm to public health and safety." Urbana Site The Urbana site is a 2.86-acre area, which includes a 15,000 square foot U-shaped area surrounding a city water tower. The U-shaped area was initially used as a borrow pit in 1966 for the construction of a porcelain manufacturing facility known as the Chi-Vit facility. From 1966 until 1976, when an off-site disposal area became available, the borrow pit was used for on-site disposal of Chi-Vit's off-spec metal oxides, raw materials, and general rubbish. The site was eventually covered with topsoil. It is now a lawn. A few bare spots in the grass are visible. Although the bare spots are a "red flag" suggesting soil contamination, Gary Vajda, the Debtors' expert, said those bare areas are near the water tower and result from vehicular traffic. John Gulch, the EPA's environmental expert, expressed his concern that the U-shaped disposal site was a known industrial disposal site for 10 years and that there was no specific listing of what went into this site. Michael Starkey, the EPA's groundwater expert, and Mr. Gulch's collective proposal for the Urbana site included: -- a site assessment at a cost of $179,520, -- the removal of hazardous waste, if necessary, at a cost of $1,650,000, and -- closure of the wells at a cost of $13,200. The EPA was very clear that the need for the removal of hazardous waste would be entirely dependent upon the results from a site assessment. On the other hand, Mr. Vajda contended that the removal of the existing groundwater testing wells and a deed restriction to insure the integrity of the soil would cost $45,000. Judge Aug concluded that: -- the Debtors' proposal for the Urbana site will bring the property into compliance with federal and state laws, -- the proposed funding of $45,000 is sufficient to bring the site into compliance with applicable laws, and -- the Debtors have satisfied their burden of proof and have not proposed a plan forbidden by law. Sidney Site The Sidney site is an 11.7-acre parcel consisting of an upper 3-acre sandfill and a lower 9-acre dumping ground which is heavily wooded. The Debtors leased the site for several years before buying the property in 1988. The 3-acre sandfill consists of spent nontoxic foundry sand -- which is not a hazardous substance -- that was deposited by the Debtors from 1986 to 2000 as a byproduct of their nearby aluminum casting operation. The Debtors obtained the necessary regulatory permits from Shelby County, Ohio, for the sandfill and samples of the sand were routinely tested. The Debtors received a "final letter" from the county upon closure of the foundry in 2000. There is no evidence that the sandfill, at any time, was not in compliance with any environmental regulations. The lower nine acres have been used as a general public dump for decades. A 1988 site inspection performed in-house by the Debtors relative to their purchase of the property indicates the presence of general rubbish and industrial garbage. Soil samples taken by the Debtors at the time of the 1988 inspection showed elevated levels of arsenic, lead, and chromium, all of which are defined as hazardous substances. The most disturbing test result showed the presence of 28,000 mg/kg of lead in one sample, which is 70 times the action level for that metal. The Debtors' expert, Gary Vajda, opined that the sandfill posed no environmental problems. He further opined that the 28,000-mg/kg samples were a "clear outlier." He described the lower nine acres as an eyesore that definitely needs to be cleaned up. Mr. Vajda's proposal for the Sidney site includes (a) removal of the debris from the lower nine acres, (b) removal and replacement of 700 square yards of soil, and (c) adding six inches of topsoil and grass seed to the upper 3-acre sandfill. The cost of this remediation work would be $380,000. The remediation would be followed by a site assessment at a cost of $430,000. Including oversight costs and a deed restriction, the total cost of Mr. Vajda's proposal is $900,000. Mr. Vajda's proposal expressly presumes that the results of the site assessment will yield no results that require further action. Mr. Vajda testified that he based his calculations on the expectation that the Sidney property would be brought through Ohio's Voluntary Action Program. Any property that successfully goes through the VAP would be in compliance with Ohio's environmental laws. Mr. Gulch and Mr. Starkey's collective proposal on behalf of the EPA for the Sidney site included: 1) a site assessment at a total cost of $552,000; 2) addition of soil to the 3-acre sandfill at a cost of $275,000 or hazardous waste removal, if necessary, at a cost of $3,750,780; 3) hazardous waste removal of the lower nine acres and replacement of 14,520 square yards of topsoil and grass seed at a cost of $4,174,368; 4) long term (up to 29 years) sampling at a cost of $765,000; and 5) perimeter fencing of the site at a cost of $87,000. The total cost of the EPA's proposal is from $5,855,256 to $9,330,420. Although Mr. Gulch and Mr. Starkey strenuously opined that a site assessment should occur prior to any remediation work, the three experts agreed that this site requires both a site assessment and some type of clean up activity. The three experts also generally agreed as to the scope of the site assessment. The difference stemmed from the scope of the cleanup thought to be required. Judge Aug observed that but for the Debtors' bankruptcy proceedings, the Sidney site wouldn't be receiving any attention. Judge Aug also said that the Sidney site is a contrast of "knowns" and "unknowns". The "known" is that the nine acres have been used by the general public as a dump for decades. The "unknown" is what has been dumped there and by whom. Judge Aug opined that: -- most of the dumped materials on the site are garbage and not hazardous waste, since the site has never been investigated by the Ohio EPA, -- the site is easier to clean up and will not require as much topsoil removal and replacement as estimated by the EPA, -- although the Debtors did not clean the eyesore on their own accord, they would not have purchased the property if they believed they were purchasing nine acres of hazardous waste. To temper his decision, Judge Aug added a 20% contingency to the Debtors' proposed amount. Judge Aug concluded that: -- the Debtors' proposal for the Sidney site with an added 20% contingency fee will bring the property into compliance with federal and state laws, -- the funding of the Sidney Custodial Trust in the increased amount of $1,080,000 is sufficient, and -- with the addition of the contingency fee, the Debtors have satisfied their burden of proof and not proposed a plan forbidden by law. Judge Aug's Memorandum Opinion is published at 2006 WL 2050342. Headquartered in Phoenix, Arizona, EaglePicher Incorporated -- http://www.eaglepicher.com/-- is a diversified manufacturer and marketer of innovative advanced technology and industrial products for space, defense, automotive, filtration, pharmaceutical, environmental and commercial applications worldwide. The company along with its affiliates and parent company, EaglePicher Holdings, Inc., filed for chapter 11 protection on April 11, 2005 (Bankr. S.D. Ohio Case No. 05-12601). Stephen D. Lerner, Esq., at Squire, Sanders & Dempsey L.L.P, represents the Debtors in their restructuring efforts. Houlihan Lokey Howard & Zukin is the Debtors financial advisor. When the Debtors filed for protection from their creditors, they listed $535 million in consolidated assets and $730 in consolidated debts. The Company emerged from chapter 11 on Aug. 1, 2006, under its confirmed chapter 11 plan, and is now principally owned by affiliates of Angelo, Gordon & Company and Tennenbaum Capital Partners. EASYLINK SERVICES: Reports $18.9 Mil. in Revenues for Second Qtr. ----------------------------------------------------------------- EasyLink Services Corporation reported financial results for the second quarter ended June 30, 2006. Revenues for the second quarter of 2006 were $18.9 million as compared to $18.5 million for the first quarter of 2006 and $20.1 million for the second quarter of 2005. Gross margin was 58% in the second quarter of 2006 as compared to 60% in the first quarter of 2006 and 65% in the second quarter of 2005. Net loss was $89,000 or approximately breakeven on a per share basis as compared to a net loss of $376,000 for the first quarter of 2006 and net income of $766,000 for the second quarter of 2005. The 2005 period costs were reduced by $650,000 in credits from the settlement of claims against Verizon Business. The Company further reported that it achieved earnings before interest, taxes, depreciation and amortization of $941,000 in the second quarter of 2006, as compared to EBITDA in the first quarter of 2006 of $762,000 and EBITDA in the second quarter of 2005 of $2.7 million. The Company's cash and cash equivalents balance of $6.3 million at the end of the second quarter increased by $2.2 million from March 31, 2006. During the second quarter the Company raised $5.4 million in an equity financing. $3 million of the proceeds were used to prepay a portion of debt with Wells Fargo as required by our credit agreement with Wells Fargo and the balance of $2.4 million is for working capital purposes. Subsequent to June 30, 2006 the Company entered into a new credit facility with CAPCO Financial Co. a division of Greater Bay Bank and paid off its loan balance with Wells Fargo. This new credit facility has a lower interest rate than the Company's previous credit facility with Wells Fargo and has less restrictive covenants. For the quarter ended June 30, 2006, net cash from operating activities improved to $709,000 from a negative $66,000 for the previous quarter ended March 31, 2006. "Our business fundamentals continued to gain momentum as 2006 progresses," Thomas Murawski, Chairman, President and Chief Executive Officer of EasyLink, said. "The second quarter was an important milestone for us as our first with total company revenue growth versus the previous quarter. We also expect to deliver solid TMS revenue growth in the third quarter as we continue to experience TMS account growth including that from a recently executed software license arrangement completed in the second quarter. "Our team showed tremendous creativity and flexibility during the quarter in landing this major sale with a Fortune 20 company that EasyLink delivered as a software solution rather than as a service. These achievements reflect better execution company- wide, with significant improvements in Transaction Delivery Services revenue retention in the quarter and continued revenue growth in Transaction Management Services. All of these factors point to the fundamental strength of our sales team and our value proposition." Going Concern Doubt As reported in the Troubled Company Reporter on May 16, 2006, Grant Thornton LLP expressed substantial doubt about Easylink's ability to continue as a going concern after it audited the Company's financial statement for the year ended Dec. 31, 2005. The accounting firm pointed to the Company's history of operating losses, accumulated deficit and negative working capital. About Easylink Services Headquartered in Piscataway, New Jersey, Easylink Services Corporation (NASDAQ: EASY) -- http://www.EasyLink.com/-- provides outsourced business process automation services to medium and large enterprises, including 60 of the Fortune 100, to improve productivity and competitiveness by transforming manual and paper- based business processes into efficient electronic business processes. EMCOR GROUP: Earns $16.9 Million in 2006 Second Quarter ------------------------------------------------------- In the second quarter of 2006, EMCOR Group Inc.'s net income increased 112.5% to $16.9 million, from $7.9 million in the second quarter of 2005. The Company's second quarter 2006 revenues totaled $1.22 billion compared to $1.17 billion in the second quarter of 2005, an increase of 4.4%. For the 2006 six-month period, the Company's net income was $23.9 million, an increase of 142.5% over net income of $9.8 million for the first half of 2005. 2006 year-to-date revenues totaled $2.37 billion versus revenues of $2.25 billion in the same period last year, an increase of 5.3%. Commenting on the results, Frank T. MacInnis, EMCOR Group's chairman and chief executive officer, said, "[w]e are very pleased with our strong performance during the second quarter, which built upon the excellent start we had to 2006. Our success was driven by solid performance across all of our businesses, including improved results within our UK and Canadian operations. The second quarter also saw the continued successful growth of our facilities services business, reflecting over 20% revenue growth for both the second quarter and six-month period. Facilities services reported enhanced profitability due to strong market demand and our ability to leverage that business' existing infrastructure." Mr. MacInnis added, "Over the past few years, EMCOR Group has executed on a strategy of reducing our exposure to certain public sector markets and reserving capacity for an expected recovery within the more profitable private and commercial sectors. We have seen this recovery over the past few quarters, and today over half of our contract backlog is represented by the commercial and hospitality sectors, while maintaining strong backlog positions in other attractive sectors of the marketplace. We believe the actions we have taken have resulted in a stronger, better balanced backlog that positions us well for continued performance in the future." EMCOR Group Inc. -- http://www.emcorgroup.com/-- provides mechanical and electrical construction services, energy infrastructure and facilities services. * * * EMCOR Group Inc.'s subordinate debt and long-term corporate family rating carry Moody's Ba3 and Ba1 ratings respectively. The ratings were placed on Oct. 31, 2002 with a stable outlook. In January of the same year, Standard & Poor's placed the Company's long-term local and foreign issuer credit ratings at BB+ with a stable outlook. FRIENDLY ICE CREAM: July 2 Balance Sheet Upside-Down by $139 Mil. ----------------------------------------------------------------- Friendly Ice Cream Corporation's balance sheet at July 2, 2006 showed total assets of $223 million and total liabilities of $362 million resulting in a stockholders' deficit $139 million. At January 1, 2006, the Company's balance sheet showed a stockholders' deficit $142 million. The Company's reported net income in the second quarter of 2006 was $4.7 million, compared to net income of $2.5 million in the same period of 2005. Total revenues for the second quarter of 2005 were $141.5 million, a decrease of $3.6 million as compared to total revenues of $145.1 million for the same period in the prior year. The Company also reported year-to-date, net income of $2.8 million, compared to a net loss of $500,000 for the prior year, and total revenues were $267.2 million, an increase of $400,000 as compared to total revenues of $266.8 million for the prior year. One new company-operated restaurant and one new franchise restaurant were opened during the second quarter of 2006, the Company disclosed, and also, three company-operated restaurants were re-franchised, resulting in a gain on franchise sales of restaurant operations and properties of $1.1 million. The Company also disclosed that, twenty-two company-operated restaurants were remodeled during the second quarter. The Company had 11 restaurants that were reported as "held for sale" as of January 1, 2006, and during the quarter ended July 2, 2006, it sold two of these restaurants. The transactions resulted in gross proceeds of $1.6 million and a net gain on disposal of $1.2 million. Revolving Credit Facility The Company further disclosed that it amended its $35 million Credit Facility with Wells Fargo Foothill to extend the maturity date from June 30, 2007 to June 30, 2010, eliminate the interest coverage requirement and reduce the applicable margin rates by 0.5% to 0.75% to a range of 3.00% to 4.00%. Friendly Ice Cream Corporation (AMEX: FRN) -- http://www.friendlys.com/-- is a vertically integrated restaurant company serving signature sandwiches, entrees and ice cream desserts in a friendly, family environment in 525 company and franchised restaurants throughout the Northeast. The company also manufactures ice cream, which is distributed through more than 4,500 supermarkets and other retail locations. With a 70- year operating history, Friendly's enjoys strong brand recognition and is currently remodeling its restaurants and introducing new products to grow its customer base. * * * As reported in the Troubled Company Reporter on March 24, 2006, Standard & Poor's Ratings Services lowered its corporate credit rating on restaurant operator Friendly Ice Cream Corp. to 'B-' from 'B'. The senior unsecured debt rating was also lowered to 'CCC+' from 'B-'. The outlook is negative. G-FORCE: Fitch Holds Low-B Ratings on Six Class Certificates ------------------------------------------------------------ G-FORCE 2005-RR LLC, series 2005-RR, commercial mortgage-backed securities pass-through certificates are affirmed by Fitch Ratings as: -- $87.9 million class A-1 at 'AAA'; -- $220 million class A-2 at 'AAA'; -- $40.2 million class B at 'AA'; -- $25.1 million class C 'A'; -- $5 million class D at 'A-'; -- $17 million class E at 'BBB+'; -- $8.2 million class F at 'BBB'; -- $10.7 million class G at 'BBB-'; -- $14.5 million class H at 'BB+'; -- $6.3 million class J at 'BB'; -- $5.7 million class K at 'BB-'; -- $7.5 million class L at 'B+'; -- $4.4 million class M at 'B'; -- $5 million class N at 'B-'. Classes O-1 through O-6 are not rated by Fitch. The affirmations are the result of minimal changes to the ratings of the underlying securities, as well as limited paydown of the transaction since issuance. As of the June 2006 distribution date, the transaction has paid down 2.4% since issuance, to $490.8 million from $502.9 million. There have been no losses to the Re REMIC to date. The certificates are collateralized by all or a portion of 42 fixed-rate classes in 16 separate CMBS transactions. The weighted average rating factor is 17.8 ('BB/BB-'), stable from issuance. The classes' ratings are based on Fitch's actual rating, or on Fitch's internal credit assessment for those classes not rated by Fitch. Delinquencies in the underlying transactions are: * 30 days (0.02%); * 60 days (0.0%); * 90 days or more (0.4%); * foreclosure (0.3%); and * REO (0.3%). G-FORCE: Fitch Holds Low-B Ratings on $77.4 Mil. Class Certs. ------------------------------------------------------------- G-FORCE 2005-RR2 LLC, series 2005-RR2, commercial mortgage-backed securities pass-through certificates are affirmed by Fitch Ratings as: -- $59.6 million class A-1 at 'AAA'; -- $150.0 million class A-2 at 'AAA'; -- $250.0 million class A-3FL1 at 'AAA'; -- $50.0 million class A-4A at 'AAA'; -- $58.5 million class A-4B at 'AAA'; -- $64.9 million class B at 'AA'; -- $47.4 million class C 'A'; -- $17.5 million class D at 'A-'; -- $21.2 million class E at 'BBB+'; -- $23.7 million class F at 'BBB'; -- $31.2 million class G at 'BBB-'; -- $20.0 million class H at 'BB+'; -- $12.5 million class J at 'BB'; -- $11.2 million class K at 'BB-'; -- $12.5 million class L at 'B+'; -- $11.2 million class M at 'B'; -- $10.0 million class N at 'B-'; Class O is not rated by Fitch. The affirmations are the result of minimal changes to the ratings to the underlying securities, as well limited paydown of the transaction since issuance. As of the July 2006 distribution date, the transaction has been reduced by 5.7% since issuance to $939.7 million from $996.4 million. Of the reduction, realized losses total 2.6% and repayments total 3.1%. The certificates are collateralized by all or a portion of 147 classes of fixed rate CMBS in 24 separate underlying CMBS transactions. The weighted average rating factor (WARF) is 23.2 ('BB-/B+'), stable from issuance. T he classes' ratings are based on Fitch's actual rating, or on Fitch's internal credit assessment for those classes not rated by Fitch. Delinquencies in the underlying transactions are: * 30 days (0.1%); * 60 days (0.01%); * 90 days or more (0.1%); * foreclosure (0.6%) and * REO (0.2%). GALLERIA INVESTMENTS: Files Disclosure Statement in N.D. Georgia ---------------------------------------------------------------- Galleria Investments, LLC, filed with the U.S. Bankruptcy Court for the Northern District of Georgia a disclosure statement explaining its Chapter 11 Plan of Reorganization. Overview of the Plan The Plan contemplates the sale of the Debtor's property. On July 12, 2006, the Court approved the Debtor's sale of its 15.48-acre property to Hong Duck, LLC, for $20.2 million. The sale proceeds will be used to satisfy Allowed Secured Claims that constitute liens that are valid and enforceable against the property. Any remaining sale proceeds after the satisfaction of all Allowed Secured Claims will be paid into a General Distribution Fund along with any recoveries from causes of action. Funds in the General Distribution Fund will be distributed in accordance with the priorities established under the Bankruptcy Code. Treatment of Claims Under the Debtor's Plan, all Allowed Administrative Claims and Professional Fee Claims will be paid in full. Priority Tax Claims will be paid in full with 6% interest rate accruing from the Effective Date. Georgian Bank's secured claims with a principal amount of $16,530,229 will either be: a) paid in full at the closing of the sale of the property from the sale proceeds, or b) acquired as part of the sale of the property, with the purchaser taking the property subject to the Gregorian Bank lien, which lien will remain in full force and effect as against the property. Allowed Secured Claims of: -- Continental Development Group -- Ordner Construction Co., Inc. -- Betterway Conveyors and Pumps -- Couch Interiors, Inc. -- Pro-Electric Co. -- Storefronts, Inc. -- Three Star Construction Development -- United Design Group -- Vecco, Inc. will be paid in full from the sale proceeds. Creditors holding Allowed General Unsecured Claims will receive, in full satisfaction, release and discharge of and in exchange for their claims, a pro rata share of any cash distribution from the Debtor. All Equity Interests will be cancelled, provided, however that the Interest Holders will be entitled to receive distributions from the Distribution Funds after full payment of all Allowed General Unsecured Claims, with 6% interest rate accruing from and after the Effective Date. Headquartered in Decatur, Georgia, Galleria Investments, LLC, operates a shopping center in Duluth, Georgia. The company filed for chapter 11 protection on Mar. 6, 2006 (Bankr. N.D. Ga. case No. 06-62557). G. Frank Nason, IV, Esq., at Lamberth Cifelli Stokes & Stout, P.A., represents the Debtor in its restructuring efforts. When the Debtor filed for protection from its creditors, it estimated assets and debts between $10 million and $50 million. Galleria Investments has been under state court receivership since Feb. 24, 2006. GENELABS TECHNOLOGIES: Posts $4 Mil. Net Loss in 2nd Quarter 2006 ----------------------------------------------------------------- For the three months ended June 30, 2006, Genelabs Technologies, Inc. reported net loss of $4,297,000 from total revenues of $2,319,000. The Company's balance sheet at June 30, 2006 showed total shareholders' equity of $3,606,000 compared to a $783,000 shareholders' deficit at March 31, 2006. A full-text copy of the Company's financial report for the quarter ended June 30, 2006 is available for free at: http://researcharchives.com/t/s?f34 Going Concern Doubt As reported in the Troubled Company Reporter on May 1, 2006, Ernst & Young LLP expressed substantial doubt about Genelabs Technologies, Inc.'s ability to continue as a going concern after it audited the company's financial statement for the year ended Dec. 31, 2005. The auditing firm pointed to the Company's recurring losses from operations, accumulated deficit and availability of funds for use in operations. About Genelabs Based in Redwood City, California, Genelabs Technologies, Inc. -- http://www.genelabs.com/-- discovers and develops pharmaceutical products. GS MORTGAGE: Fitch Holds B Rating on Class G Certificates --------------------------------------------------------- Fitch Ratings upgrades these GS Mortgage Security Corp. II 1998-GL II commercial mortgage pass-through certificates, as: -- $98.6 million class D to 'AAA' from'AA+'; -- $70.5 million class E to 'AA' from 'A+'. In addition, these classes are affirmed: -- $46.1 million class A-1 at AAA'; -- $694.3 million class A-2 at 'AAA'; -- $91.6 million class B at 'AAA'; -- $84.6 million class C at 'AAA'; -- $63.4 million class F at 'BBB-'; -- $28.2 million class G at 'B'; -- Interest Only class X at 'AAA'. The upgrades are due to the partial defeasance of the Crystal City and Tharaldson A loans, as well as the continued amortization of the ten loans remaining in the transaction. As of the July 13, 2006 distribution date, the pool balance had declined 16.5% to $1.18 billion from $1.41 billion at issuance. As of the July distribution date, 29% of the remaining collateral had defeased, including three whole loans, and 22% of the Crystal City loan, 53% of the Tharaldson A loan, and 1% of the Americold Pool loan. Five loans representing 60% of the transaction are cross- collateralized and cross-defaulted pools. The URS (18%) and Americold (10.6%) collateral consist of pools of cold storage facilities. The year end (YE) 2005 DSCR for the URS loan was 1.62x up from 1.44x at YE 2004, despite a decline in net cash flow (NCF) that was largely due to an increase in freight expenses. The DSCR for the Americold loan at YE 2005 was 1.84x, 23 basis points higher than at issuance. The DSCRs for both the Tharaldson A and B loans, which consist of two pools of limited- service hotels, have improved since issuance, largely due to amortization. The YE 2005 DSCR for the Tharaldson B pool (12.95%) was 1.85x as compared to 1.67x at issuance, and 1.93x for the Tharaldson A pool (12.64%) as compared to 1.66x at issuance. As of YE 2005, the NCF at the Green Acres Mall in Valley Stream, NY had increased 32% since issuance. The DSCR at YE 2005 was 1.92x as compared to 1.36x at issuance. Occupancy at the Valley Stream, NY, mall was 88.5% at YE 2005. The Crystal Gateway (5.77%) collateral now consists of two office buildings in the Arlington, VA Pentagon submarket, and government securities replacing the 1919 South Eads Street office property. The two remaining buildings, representing 78% of the loan, were 100% and 93% occupied at YE 2005, with an adjusted DSCR for those two remaining buildings of 2.04x. While showing improvement in occupancy and Revenue Per Available Room (Rev Par), The Marriott Desert Springs hotel loan (7.38%) continues to perform below expectations at issuance. The YE 2005 NCF was 48% below underwritten NCF at issuance. Nonetheless, RevPar at YE 2005 had improved 9. 6% over the previous year, with gains in occupancy and rental rates being offset by increased expenses. The loan is not considered an investment grade loan. HEALTHTRONICS INC: Loan Paydown Prompts S&P to Hold BB- Rating -------------------------------------------------------------- Standard & Poor's Ratings Services affirmed its ratings on Austin, Texas-based urology services and medical device manufacturer HealthTronics Inc., fka Prime Medical Services Inc. The corporate credit rating was affirmed at 'BB-' and the rating outlook is stable. The affirmation follows the paydown of the company's term loan B with proceeds from the sale of its specialty vehicles business. Though 2006 second-quarter performance was slightly weaker than the 2005 comparable period (revenues from continuing operations declined by over 3%), HealthTronics new CEO is reorganizing the company to focus on cost cutting and strategic expansion opportunities. "While the company currently has negligible debt, we anticipate that some portion of future acquisitions will be debt financed," noted Standard & Poor's credit analyst Cheryl Richer. The rating on HealthTronics reflects the company's narrow business focus, vulnerability to third-party reimbursement rates, and significant minority interest payments. The rating also reflects the company's mature lithotripsy operations and acquisition-based growth strategy. These challenges are mitigated by HealthTronics' market leadership in the lithotripsy medical segment, its efforts to leverage off its physician-partner base to expand its product portfolio, and its historically moderate financial policies. HIGHWOODS PROPERTIES: Credit Facility Upsized to $450 Million ------------------------------------------------------------- Highwoods Properties, Inc., reported that its $350 million, three- year unsecured revolving credit facility, which was initially obtained from Bank of America, N.A in May 2006, was syndicated with a group of 15 banks and upsized to $450 million. As reported in the Troubled Company Reporter on May 8, 2006, the new facility replaced the Company's previous $250 million unsecured revolving credit facility that was scheduled to expire in July 2006. "We are very pleased with the strong support that these banks have shown in Highwoods and in our business model, which has allowed us to recast and upsize our credit facility by $100 million" Ed Fritsch, President and Chief Executive Officer of Highwoods Properties, said. "This increase in the size of the facility provides additional financial flexibility for us as we execute on our Strategic Plan, which includes a growing development pipeline that is currently $361 million." The revolving credit facility is initially scheduled to mature on May 1, 2009. Assuming no default exists, the Company has the option to extend the maturity date by one additional year and, at any time prior to May 1, 2008, may request up to $50 million of additional borrowing availability. There is currently $285 million outstanding under the revolving credit facility. The new credit facility is being led by Bank of America, N.A. as Administrative Agent with Banc of America Securities LLC as Sole Lead Arranger and Sole Book Manager, and includes Wells Fargo Bank as Syndication Agent and Branch Banking & Trust Co. and Wachovia Bank as Co-Documentation Agents; Emigrant Bank, Eurohypo AG and PNC Bank are Co-Agents. Other lenders include: AmSouth Bank, Chevy Chase Bank, Comerica Bank, First Horizon Bank, RBC Centura Bank, Regions Bank, Union Bank of California N.A., and US Bank. About Highwoods Properties Based in Raleigh, North Carolina, Highwoods Properties, Inc. (NYSE: HIW) -- http://www.highwoods.com/-- a member of the S&P MidCap 400 Index, is a fully integrated, self-administered real estate investment trust that provides leasing, management, development, construction and other customer-related services for its properties and for third parties. As of March 31, 2005, the company owned or had an interest in 504 in-service office, industrial and retail properties encompassing approximately 39.5 million square feet. Highwoods also owns 1,115 acres of development land. Highwoods' properties and development land are located in Florida, Georgia, Iowa, Kansas, Maryland, Missouri, North Carolina, South Carolina, Tennessee and Virginia. * * * Highwoods Properties, Inc.'s 7.5% Senior Notes due 2018 carry Moody's Investors Service's Ba1 rating. HOWARD HUH: Case Summary & Largest Unsecured Creditor ----------------------------------------------------- Debtor: Howard Huh aka Hyun Huh dba Beverly Hot Springs dba Beverly Springs Medical Center dba Beverly Springs Acupuncture Clinic 647 Wilcox Apt 2F Los Angeles, California 90004 Bankruptcy Case No.: 06-13682 Chapter 11 Petition Date: August 8, 2006 Court: Central District of California (Los Angeles) Judge: Alan M. Ahart Debtor's Counsel: Jaenam J. Coe, Esq. Law Offices of Jaenam Coe 3530 Willshire Boulevard, Suite 1200 Los Angeles, California 90010 Tel: (213) 389-1400 Fax: 213-387-8778 Estimated Assets: $1 Million to $10 Million Estimated Debts: $1 Million to $10 Million Debtor's Largest Unsecured Creditor: Entity Nature of Claim Claim Amount ------ --------------- ------------ Yang Cha Kim Partnership Dispute Unknown 308 North Oxford Los Angeles, California 90008 ICOS CORP: June 30 Balance Sheet Upside-Down by $35.9 Million ------------------------------------------------------------- ICOS Corporation's balance sheet at June 30, 2006 showed total stockholders' deficit of $35,919,000 resulting from total assets of $266,135,000 and total liabilities of $302,054,000. For the three months ended June 30, 2006, the Company reported net income of $6,075,000 from total revenue of $18,548,000. A full-text copy of the Company's financial report for the quarter ended June 30, 2006 is available for free at: http://researcharchives.com/t/s?f39 About ICOS Corp Headquartered in Bothell, Washington, ICOS Corp., is a biotechnology company developing treatments for erectile dysfunction, benign prostatic hyperplasia, pulmonary arterial hypertension, cancer and inflammatory diseases. IMMUNE RESPONSE: Raises $9.9 Mil. from First Tranche of Warrants ---------------------------------------------------------------- The Immune Response Corporation raised $9.9 million in gross proceeds from investors exercising 495,552,100 warrants from the first tranche warrants that were issued in the Company's March 2006 private placement financing. The total gross proceeds include an investment of $250,000 by Qubit, LLC, an affiliate of the Company's largest stockholder and director, Kevin Kimberlin, to exercise 12,500,000 warrants that were issued in conjunction with a February 2006 transaction related to the March 2006 financing. As reported in the Troubled Company Reporter on July 6, 2006, in the March financing, the Company issued $8 million of secured notes convertible into 400,000,000 shares of common stock at $0.02 per share, accruing interest at 8% per year and maturing on Jan. 1, 2008. Investors also received warrants to purchase an aggregate of 1,200,000,000 shares of common stock at $0.02 per share. The warrants were divided into two 600,000,000, warrant tranches, each generating a potential $12 million in gross proceeds. The second tranche of warrants (600,000,000) will become exercisable Oct. 16, 2006, and will expire on Nov. 30, 2006. If fully exercised, the second tranche would generate an additional $12 million in gross proceeds for the Company. Of the $8 million of secured notes, the holders have to date converted approximately $1.7 million into common stock. The Registration Statement for the resale of common stock underlying the convertible notes and warrants issued in the Company's March 2006 private placement financing was declared effective June 13, 2006 by the Securities and Exchange Commission. "We are gratified that investors participating in the private financing showed support for the Company by exercising their warrants," said Michael K. Green, Chief Operating Officer and Chief Financial Officer. "This funding will allow the Company to continue moving forward on schedule and initiate Phase II clinical trials for multiple sclerosis this fall. The funding also allows us to continue our enrollment and initiation of Phase II clinical trials of our investigational HIV products. We are very pleased with the progress of our Phase II trials, financing strategies and the positive developments at our vaccine manufacturing facility in King of Prussia, Pennsylvania." About Immune Response Headquartered in Carlsbad, California, The Immune Response Corporation (OTCBB:IMNR) -- http://www.imnr.com/-- is an immuno-pharmaceutical company focused on developing products to treat autoimmune and infectious diseases. The Company's lead immune-based therapeutic product candidates are NeuroVax(TM) for the treatment of multiple sclerosis (MS) and IR103 for the treatment of Human Immunodeficiency Virus (HIV) infection. Both of these therapies are in Phase II clinical development and are designed to stimulate pathogen-specific immune responses aimed at slowing or halting the rate of disease progression. Going Concern Doubt As reported in the Troubled Company Reporter on June 8, 2006, Levitz, Zacks & Ciceric expressed substantial doubt about The Immune Response's ability to continue as a going concern after auditing the company's financial statements for the years ended Dec. 31, 2005 and 2004. The auditing firm pointed to the Company's stockholders' deficit and comprehensive loss for each of the years in the two-year period ended Dec. 31, 2005. The Company incurred $6.5 million of net income for the three months ended March 31, 2006. At March 31, 2006, the Company's balance sheet showed $9.9 million in total assets and $144.7 million in total liabilities, resulting in a $134.7 million equity deficit. IMPERIAL PETROLEUM: Closes $13.6MM Asset Sale to Whittier Energy ---------------------------------------------------------------- Imperial Petroleum, Inc., closed the sale of certain assets to Whittier Energy Company and Premier Natural Resources LP. Proceeds from the sale of $13.6 million, will be used to pay down the Company's senior debt. The Company retained $1.8 million of the assets previously included in the sale and anticipates a subsequently closing by the buyers on a portion of those assets. "Our asset sale is the key first step in re-structuring the Company's senior debt and positioning it for future growth," Jeffrey T. Wilson, President of Imperial said of the sale. "Our shareholders approved the reverse split of common stock and new capitalization of the Company in connection with the approval of the sale and as a result, the Company will be able to complete the previously announced financing in the coming weeks. With the return of production now from our South Louisiana properties, we can focus our efforts on developing our other assets, including our New Albany shale drilling project in the Illinois Basin." Headquartered in Evansville, Indiana, Imperial Petroleum, Inc., (OTCBB:IPTM) is an oil and natural gas exploration and production company. At Jan. 31, 2006, the Company's balance sheet showed a stockholders' deficit of $3,352,586, compared to a deficit of $2,198,762 at July 31, 2005. INCO LTD: Gets CDN$86 Per Share All-Cash Buy Offer from CVRD ------------------------------------------------------------ Companhia Vale do Rio Doce intends to make an all-cash offer to acquire all of the outstanding common shares of Inco Limited at a price of CDN$86 in cash per Inco common share. The combination of CVRD and Inco will create one of the three largest diversified mining companies in the world, with leading global market positions in iron ore, pellets, nickel, bauxite, alumina, manganese and ferroalloys, and an exciting world-class pipeline of projects, supported by a large-scale, long-life and low-cost asset portfolio. CVRD's all-cash offer of CDN$86 per share will allow Inco shareholders to realize upfront in cash Inco's profitable growth potential without incurring the risk of that such potential will not be realized. The acquisition will be financed through a two-year committed bridge loan facility provided by four large first-tier banks: Credit Suisse, UBS, ABN AMRO and Santander. CVRD expects to take out the bridge facility with a long-term capital package within 18 months after the closing of the proposed transaction. CVRD remains firmly committed to maintaining its investment-grade rating. CVRD will retain financial flexibility after the transaction and will seek to obtain future upgrades in its current ratings, continuing to pursue the minimization of the cost of capital. Full details of the offer will be included in the formal offer and take-over bid circular documents to be publicly filed and subsequently mailed to Inco's security holders. CVRD is formally requesting a list of Inco's shareholders and expects to mail the take-over bid and circular documents to Inco's shareholders as soon as possible following receipt of the shareholder list. CVRD expects to formally commence its offer by newspaper advertisement today, Aug. 14, 2006. The offer will be open for acceptance for 45 days following its formal commencement and no Inco common shares will be taken up and paid for pursuant to the offer unless, at such date, each of the conditions of the offer is satisfied or waived. Completion of the offer will be subject to a sufficient number of shares being tendered to the offer such that CVRD would own at least 66-2/3% of Inco's common shares, on a fully diluted basis, following completion of the offer. The offer will be also conditional upon the receipt of all necessary regulatory approvals, the absence of litigation, no material adverse change at Inco and other customary conditions. "This is an exciting opportunity for CVRD," CVRD Chief Executive Officer, Roger Agnelli said. "The operations of the two companies are complementary and the combination will enhance our capabilities to benefit from the fast changing global landscape in the metals and mining industry. For Inco shareholders, our all- cash offer provides a very attractive opportunity to realize substantial gains with no exposure to market risks". Strategic Alignment and Expected Benefits The offer is consistent with CVRD's long-term corporate strategy and with its non-ferrous metals business strategy. It is a new step in our strategy of developing, operating and maximizing the performance of large-scale, long-life and low-cost assets. The proposed transaction enhances its options to further generate the increase in production capacity needed to meet the demand for minerals and metals of high growth markets over time. The proposed transaction will bring a better diversification to CVRD's activities by products, markets and geographic asset base contributing to reducing our business and financial risks. About CVRD Headquartered in Rio de Janeiro, Brazil, Companhia Vale do Rio Doce -- http://www.cvrd.com.br/-- engages primarily in mining and logistics businesses. It engages in iron ore mining, pellet production, manganese ore mining, and ferroalloy production, as well as in the production of nonferrous minerals, such as kaolin, potash, copper, and gold. About Inco Ltd. Headquartered in Sudbury, Ontario, Inco Limited (TSX, NYSE:N) -- http://www.inco.com/-- produces nickel, which is used primarily for manufacturing stainless steel and batteries. Inco also mines and processes copper, gold, cobalt, and platinum group metals. It makes nickel battery materials and nickel foams, flakes, and powders for use in catalysts, electronics, and paints. Sulphuric acid and liquid sulphur dioxide are produced as byproducts. The company's primary mining and processing operations are in Canada, Indonesia, and the U.K. * * * Inco Limited's 3-1/2% Subordinated Convertible Debentures due 2052 carry Moody's Investors Service's Ba1 rating. INFORMATION ARCHITECTS: Acquires Xtreme Outdoor Network ------------------------------------------------------- Information Architects have completed the acquisition of the Xtreme Outdoor Network, LLC. The Agreement provided that, in exchange for all shares of XON, the Company will issue 1,000,000 of its common shares to XON. The Company will also fund the operational cash needs of XON at closing or upon funding of the Company, in the sum of $1 million to be deposited in the account of XON. Todd K. Morgan, chief executive officer of the Company, stated, "This is a strategic acquisition which enables IA to position ClearCast Communications IPTV portal as the leader in outdoor entertainment. We are excited to have the ability to focus on such a tremendous market," Jon Grinter, the Company's president, said, "Information Architects will pull resources from other areas of operation by offering financial services for XON through an affinity membership card. I feel very good about this acquisition because many opportunities exist that will drive the cooperation of different operating units within this company. The market that XON will target is huge and we have the right tools and technology to control a significant part of that market," A full text-copy of the Asset Acquisition Agreement, is available for free at http://ResearchArchives.com/t/s?f8c About Xtreme Outdoor Xtreme Outdoor Network, Inc., -- http://www.xontv.net/-- utilizes streaming and web mall technology in providing content, products and services to outdoor sportspersons and outdoor enthusiasts. This represents a population of over 82 million people in the United States alone, which spent over $108 billion in recent years on equipment, travel, lodging and outdoor-related supplies. XON is currently in development of the Xtreme Outdoor Network Channel, a television channel to be distributed initially through an Internet Channel and followed by a Dish channel with simulcast over the Internet. The IPTV channel will be launched by August 31, 2006 exclusively on ClearCast Communications IPTV portal. About Information Architects Headquartered in Ft. Lauderdale, Florida, Information Architects Corporation (OTCBB: IACH) -- http://www.ia.com/-- provides employment screening and background investigations software application. At March 31, 2006, the Company's balance sheet showed $1,767,509 in total assets and $5,454,923 in total liabilities, resulting in a $3,687,414 stockholders' deficit. INFOUSA INC: To Acquire Opinion Research for $134.3 Million ----------------------------------------------------------- infoUSA Inc. entered into a definitive merger agreement under which it will acquire Opinion Research Corporation for $12 per share in cash. The total transaction value including the assumption of debt is approximately $134.3 million. infoUSA will finance the transaction with cash on hand at the time of closing and borrowings under its existing credit facility. infoUSA expects that the acquisition of Opinion Research Corporation will be accretive to its earnings in fiscal 2007. The transaction, which is expected to close in the fourth quarter of 2006, is subject to customary closing conditions and the approval of Opinion Research Corporation shareholders. Opinion Research Corporation will remain headquartered in Princeton, New Jersey and will continue to operate independently as part of infoUSA. "This is a compelling transaction that fits well with our strategic plan to leverage our existing capabilities and expand our presence in the market research sector," Vin Gupta, Chairman and CEO of infoUSA, stated. "The services provided and clients served by Opinion Research Corporation are highly complementary to infoUSA's services and we expect that this transaction will create significant value for infoUSA shareholders. The transaction will allow our Donnelley Group to offer market research services to its customers and the Opinion Research Corporation team to offer databases and database services to its clients. The acquisition of Opinion Research Corporation is a significant step in infoUSA's plan to become a diversified marketing services provider to the corporate and public sectors. infoUSA pioneered the concept of multi-channel marketing in its marketplace, and with annual revenue of approximately $600 million following the close of the transaction, infoUSA will have additional scale and resources to continue leading the industry forward." "This transaction delivers outstanding value for our shareholders and we look forward to joining the infoUSA family of businesses," said John Short, Chairman and CEO of Opinion Research Corporation. "infoUSA is a recognized global leader in sales and marketing solutions and we are confident that Opinion Research Corporation can make a meaningful contribution to infoUSA's continuing growth and success." infoUSA's financial advisors with respect to this transaction are DeSilva & Phillips LLC and McColl Partners, LLC, and its legal advisor is Robins, Kaplan, Miller & Ciresi L.L.P. Opinion Research Corporation's financial advisor with respect to this transaction is WWC Capital Group, LLC and its legal advisor is Wolf, Block, Schorr and Solis-Cohen LLP. About Opinion Research Based in Princeton, New Jersey, Opinion Research Corporation (Nasdaq: ORCI) -- http://www.opinionresearch.com/-- provides commercial market research, health and demographic research for government agencies, information services and consulting. Founded in 1938, the Company has built an international organization to support market intelligence in both public and commercial markets. About infoUSA Headquartered in Omaha, Nebraska, infoUSA Inc. (NASDAQ: IUSA) -- http://www.infoUSA.com/-- provides business and consumer information products, database marketing services, data processing services and sales and marketing solutions. Founded in 1972, infoUSA owns a proprietary database of 250 million consumers and 14 million businesses under one roof. * * * As reported in the Troubled Company Reporter on March 13, 2006, Standard & Poor's Ratings Services assigned its 'BB' bank loan rating and a recovery rating of '3' to infoUSA Inc.'s $275 million senior secured credit facility. At the same time, S&P affirmed the Company's 'BB' corporate credit rating. S&P said the outlook is stable. INTEGRATED ALARM: Posts $6.4 Mil. Net Loss in 2006 Second Quarter ----------------------------------------------------------------- Integrated Alarm Services Group, Inc., reported its results for the second quarter of fiscal 2006 ending June 30, 2006. Revenue for the second quarter of 2006 was $23 million down 7% over the same period in 2005 and down 5% from the first quarter of 2006. The net loss for the second quarter ending June 30, 2006 was $6.4 million compared to a net loss of $6.3 million in the second quarter of 2005, and a net loss of $3.4 million in the first quarter of 2006. Revenue for the first half of fiscal 2006 ending June 30, 2006 was $47.2 million down 4% from the same period in 2005. The net loss for the first half of 2006 was $9.9 million compared to a loss of $8.9 million for the first half of fiscal 2005. "The second quarter of 2006 witnessed a major transition for our Company" Charles May, acting President and Chief Executive Officer, said. "During the quarter new executive leadership was put in place and significant change occurred at the Board of Director level. John Mabry was elected Chairman of the Board of Directors, Jason Mudrick, portfolio manager of Contrarian Capital; joined our Board and two founders of IASG resigned from the Board. It is the objective of the Board and the management team to effectively serve our customers, efficiently manage our business activities and build shareholder value." "We made operating progress in the second quarter, however results continue to be unacceptable," May continued. Second quarter 2006 aggregate attrition was 12 percent, up from the first quarter but down significantly from second half of 2005. Second quarter 2006 operating expenses declined five percent, or $1.4 million, from the year earlier period. Earnings before interest, taxes, depreciation and amortization, EBITDA, for in the second quarter was the same in both 2006 and 2005 at $5.5 million. Finally, as the second quarter drew to a close we sold alarm contract assets generating recurring monthly revenue, RMR, of approximately $210,000 in the mountain states of Colorado, Idaho and Utah. The sale of these non-strategic assets generated consideration of $7.3 million." At June 30, 2006, the Company had $17.6 million in cash, $16.3 million of secured notes receivable from dealers and stockholders' equity of $110.4 million. The Company had $125.5 million of debt and capital leases at June 30, 2006 and ended the second quarter of 2006 with a net debt to equity ratio of 0.97 to 1. The Company had no outstanding balance on the $30 million senior credit facility at June 30, 2006. About Integrated Alarm Services Integrated Alarm Services Group -- http://www.iasg.us/-- provides total integrated solutions to independent security alarm dealers located throughout the United States to assist them in serving the residential and commercial security alarm market. IASG's services include alarm contract financing including the purchase of dealer alarm contracts for its own portfolio and providing loans to dealers collateralized by alarm contracts. IASG, with 5,000 independent dealer relationships, is also the largest wholesale provider of alarm contract monitoring and servicing. * * * As reported on the Troubled Company Reporter on April 28, 2006, Standard & Poor's Ratings Services placed its 'B' corporate credit and 'B-' senior secured second-lien debt ratings on Albany, New York-based Integrated Alarm Services Group Inc. on CreditWatch with negative implications. INTELSAT LTD: KPMG Replaces Deloitte as Independent Accountant -------------------------------------------------------------- The Audit Committee of the Board of Directors of Intelsat, Ltd., disclosed that KPMG LLP will replace Deloitte & Touche LLP, as the independent registered public accounting firm for Intelsat Holding Corporation and Intelsat Corporation, for the year ending December 31, 2006. Deloitte was notified of the decision on August 3, 2006. The Company disclosed that, Deloitte's reports on the consolidated financial statements of Intelsat Holding Corporation and Intelsat Corporation as of and for the years ended December 31, 2005 and 2004 did not contain any adverse opinion or disclaimer of opinion and were not qualified or modified as to uncertainty, audit scope, or accounting principles. The Company further said that during the fiscal years ended December 31, 2005 and 2004 and through August 3, 2006, there were no disagreements with Deloitte on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure. Intelsat, Ltd. - http://www.intelsat.com/-- offers telephony, corporate network, video and Internet solutions around the globe via capacity on 25 geosynchronous satellites in prime orbital locations. Customers in approximately 200 countries rely on Intelsat's global satellite, teleport and fiber network for high- quality connections, global reach and reliability. * * * As reported in the Troubled Company Reporter on June 19, 2006, Fitch upgraded the Issuer Default Rating for Intelsat to 'B' from 'B-' pro forma for its pending acquisition of PanAmSat. The ratings were also removed from Rating Watch Negative, where they had originally been placed on Aug. 30, 2005. Fitch said the Rating Outlook is Stable. As reported in the Troubled Company Reporter on June 13, 2006, Moody's Investors Service affirmed the B2 corporate family rating of Intelsat, Ltd., and downgraded the corporate family rating of PanAmSat Corporation to B2, given the greater clarity regarding the final capital structure and the near-term completion of the PanAmSat acquisition by Intelsat. IPCS INC: Units Obtain Court Victory against Sprint Nextel ---------------------------------------------------------- Vice Chancellor Donald F. Parsons, Jr., issued his decision with respect to the claims of iPCS, Inc.'s subsidiaries -- Horizon Personal Communications, Inc. and Bright Personal Communications Services, LLC -- against Sprint Nextel in the Court of Chancery of the State of Delaware. Horizon and Bright together manage a territory with 7.2 million licensed pops in parts of Indiana, Ohio, Tennessee, Pennsylvania and New York. The Court ruled, on Aug. 4, 2006, that Horizon/Bright is entitled to a permanent injunction against Sprint Nextel because Horizon/Bright "will suffer irreparable harm if Sprint Nextel proceeds as it wishes in the Horizon/Bright territory." Tim Yager, the Company's president and chief executive officer, stated that "the ruling is an important and significant victory in our dispute with Sprint Nextel arising out of Sprint's merger with Nextel, particularly as it relates to our exclusive rights to the Sprint brand and marks." Mr. Yager noted that the Court's decision protects and reinforces Horizon/Bright's rights in these significant ways: -- Horizon/Bright are entitled to a permanent injunction preventing Sprint Nextel from proceeding with its proposed use of the Sprint brand and marks to re-brand Nextel stores and to promote and sell Nextel products and services in the Horizon/Bright territory. -- Horizon/Bright effectively have an exclusive right to use the Sprint brand and marks in their Service Areas to offer Sprint PCS Products and Services. -- Sprint Nextel cannot offer Sprint PCS Products and Services in the Nextel stores located in the Horizon/Bright territory, as Horizon/Bright are the exclusive providers of Sprint PCS Products and Services in their territories. -- Sprint Nextel may not use Horizon/Bright confidential information to compete with Horizon/Bright. Sprint Nextel committed to additional measures to ensure that Horizon/Bright confidential information is protected, including measures with respect to customer information, network performance data, billing information, business forecasts, and marketing and advertising campaign materials. As a result of the trial, Horizon/Bright successfully obtained open-court commitments that Sprint Nextel will not take certain specific actions in the Horizon/Bright territory -- including with respect to dual-mode phones, early termination fees, national business account representatives and bill inserts. The Court stated that it "accepts Sprint Nextel's unqualified representations as binding on them for as long as the Management Agreement remains in effect." Specifically: -- Sprint Nextel committed that any dual-mode phones offered by Sprint Nextel will direct voice and data traffic to the CDMA network and not the iDEN network. -- Sprint Nextel committed that it will not waive early termination fees for customers switching from Horizon/Bright to Sprint Nextel iDEN service. -- Sprint Nextel committed that its national business account representatives will offer either CDMA or iDEN products and services, not both, in the Horizon/Bright territory and the representatives will not share customer information with each other. -- Sprint Nextel committed that it will not use bill inserts to entice Horizon/Bright customers to become Sprint Nextel iDEN customers. In reliance on these commitments, the Court did not issue a ruling as to these matters at this time. However, the Court noted that if Sprint Nextel does engage in any of these actions, the Court could promptly entertain a request for appropriate relief. The Company is optimistic that, so long as Sprint Nextel abides by its commitments, these measures will help protect the Company from unbalanced competition with Nextel products in its territory in violation of our agreements with Sprint. The Company plans to carefully monitor Sprint Nextel's compliance with these commitments and with the order that the Court will be issuing shortly to implement its ruling. In granting the Horizon/Bright request for a permanent injunction, the Court ruled that Horizon/Bright "will suffer irreparable harm if, in the Horizon/Bright territory, Sprint Nextel offers iDEN products and services using the same brand and marks as Horizon/Bright and re-brands the legacy Nextel stores with the new Sprint logo." Accordingly, the Court's issuance of a permanent injunction prevents Sprint Nextel from proceeding with its planned re-branding strategy in the Horizon/Bright territory. Although the Court stated that Sprint Nextel may engage in some limited re-branding of its stores -- such as to reflect the fact that Sprint Nextel are one company -- it "must do so in a way that does not create a likelihood of confusion in the minds of consumers as to the sponsor of the store or which products and services are available in it." Mr. Yager stated that "we are pleased that the Delaware judge agreed that Sprint Nextel's plans would breach our agreements with them and that he will be issuing a permanent injunction over Sprint Nextel's future use of its brand, marks and logo in the Horizon/Bright territory. The ruling provides a level of certainty so we can continue to execute on our business plan." He continued by stating that "the ruling is a successful first step in our litigation to protect our exclusivity and other contract rights in light of the merger between Sprint and Nextel. We are completing the post-trial briefing in iPCS's pending case in Illinois state court and look forward to another favorable ruling later this year." Pursuant to its terms, the Forbearance Agreement between Horizon/Bright and Sprint Nextel expired upon the issuance of the Court's ruling. A full-text copy of the Delaware Opinion is available for free at: http://ResearchArchives.com/t/s?f71 About iPCS, Inc. Headquartered in Schaumburg, Illinois, iPCS, Inc. (Nasdaq: IPCS) -- http://www.ipcswirelessinc.com/-- is the Sprint PCS Affiliate of Sprint Nextel with the exclusive right to sell wireless mobility communications network products and services under the Sprint brand in 80 markets including markets in Illinois, Michigan, Pennsylvania, Indiana, Iowa, Ohio and Tennessee. The territory includes key markets such as Grand Rapids (MI), Fort Wayne (IN), Tri-Cities (TN), Scranton (PA), Saginaw-Bay City (MI) and Quad Cities (IA/IL). * * * As reported in the Troubled Company Reporter on March 29, 2006, Standard & Poor's Ratings Services raised its ratings on Schaumburg, Illinois-based iPCS Inc., including the corporate credit rating, which was raised to 'B-' from 'CCC+'; and the senior unsecured debt rating, which was raised to 'B-' from 'CCC'. The outlook is stable. Debt outstanding at Dec. 31, 2005, totaled approximately $304 million. ITRON INC: Inks Pact with Gaylon to Sell Spokane Valley Facility ---------------------------------------------------------------- Itron, Inc., signed an agreement with Gaylon Patterson, to sell its 141,000 square foot headquarters facility in Spokane Valley, Washington for a price ranging between $9.2 million and $9.5 million. The agreement, the Company disclosed, includes real and personal property and assignment of an existing lease of a portion of the premises to a tenant. The sale is expected to close in the fourth quarter of 2006. The Company will move to its new headquarters facility in Liberty Lake, Washington during September 2006. Headquartered in Spokane, Washington, Itron, Inc. (NASDAQ: ITRI) -- http://www.itron.com/-- provides critical source of knowledge to the global energy and water industries. Nearly 3,000 utilities worldwide rely on Itron technology to deliver the knowledge they require to optimize the delivery and use of energy and water. Itron delivers value to its clients by providing solutions for meter data collection, energy information management, demand side management and response, load forecasting, analysis and consulting services, transmission and distribution system design and optimization, Web-based workforce automation, C&I customer care, enterprise and residential energy management. * * * Itron, Inc.'s 7-3/4% Convertible Senior Subordinated Notes due 2012 carry Moody's Investor Service's B2 rating and Standard & Poor's Rating Services' B rating. JAMES RIVER: Poor Performance Prompts S&P to Junk Rating -------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings, including lowering its corporate credit to 'CCC+' from 'B-' on Richmond, Virginia-based James River Coal Co., following the company's earnings release of weaker-than-expected financial performance and S&P's concerns about liquidity. The outlook is negative. "The downgrade reflects James River's revision of its 2006 and 2007 guidance that incorporated lower expected volumes and higher costs," said Standard & Poor's credit analyst Dominick D'Ascoli. The company said that its lower production guidance reflects the idling of higher-cost operations due to a period of softening coal prices. Indeed, Central Appalachian spot coal prices have materially declined recently to less than $50 per ton from more than $60 per ton earlier in 2006. In addition, James River is experiencing raw-material cost inflation and lower productivity, which are negatively affecting its costs and squeezing its margins. "We are also concerned that liquidity could prove insufficient in 2007 should the company realize prices lower than current spot market prices on its uncommitted production for 2006 and 2007," Mr. D'Ascoli said. "In addition, pressure from aggressive shareholders and the exploration of strategic alternatives to maximize shareholder value are likely to be additional distractions to management. We could lower the ratings if we come to expect liquidity below $10 million, cost increases beyond current company guidance, production declines, or a softening of spot coal prices. We could revise the outlook to positive if we come to expect positive free cash flow over the next couple of years and financial performance becomes less volatile." Richmond, Virginia-based James River is a relatively small coal producer; about three-quarters of its production is in the difficult operating environment of Central Appalachia. JERNBERG INDUSTRIES: PAC Entitled to Escrowed Insurance Premium --------------------------------------------------------------- The Honorable John H. Squires of the U.S. Bankruptcy Court for the Northern District of Illinois lifted the automatic stay allowing Premium Assignment Corporation to collect unearned insurance premiums being held in escrow by Richard J. Mason, the chapter 7 trustee appointed in JII Liquidating, Inc., fka Jernberg Industries, Inc.'s bankruptcy cases. PAC is a corporation in the business of financing the purchase of insurance policy premiums. PAC pays its customers' annual insurance premiums and PAC's customers, in turn, repay those funds with interest in monthly installments. Jernberg, formerly in the business of producing automotive parts, purchased three insurance policies from Thilman and Fillippini, L.L.C., an insurance agent. On March 23, 2005, PAC entered into a premium financing agreement with Jernberg. Pursuant to the Finance Agreement, PAC financed $271,803.65. PAC was to be repaid the principal plus a $6,520.05 finance charge over a period of ten months at the rate of $27,832.37 per month. On Oct. 4, 2005, PAC filed a motion to lift the automatic stay because Jernberg was in default under the Finance Agreement for failure to make the Sept. 18, 2005, payment and all subsequent payments. As of October 2005, Jernberg owed PAC $114,112.72. PAC maintains that as of June 29, 2005, the date Jernberg filed for bankruptcy, the total prepaid but unearned premiums under the Insurance Policies (which constitute PAC's security for Jernberg's debt under the Finance Agreement), total approximately $184,502. PAC contends that because the premiums are earned at the rate of $788 per day and PAC's collateral diminishes at that rate, as of Oct. 13, 2005, its collateral diminished in value to $100,924. Trustee's Objections The Trustee maintains that in order to be exempt from Article 9 of the Uniform Commercial Code, the transaction must constitute either: (1) a transfer of an interest in an insurance policy; or (2) an assignment of a claim under a policy of insurance. According to the Trustee, the Finance Agreement did not involve either type of transaction, and, therefore, it is governed by the UCC. The Trustee argues that the Finance Agreement is nothing more than a contract that is insufficient to create a security agreement. The Trustee contends that under Illinois law, in order to create a security interest in property, there must be a debt due and a separate, written grant of a security interest to secure payment of that debt. The Trustee acknowledges that there was debt due, but argues that PAC does not have a separate, written security agreement. According to the Trustee, PAC was required to file a UCC-1 financing statement to perfect its security interest in the unearned premiums. It is undisputed that PAC didn't file a UCC-1. The Trustee argues that PAC's "secret lien" in the unearned premiums should be invalidated and the Court should find that PAC does not have an interest in the unearned premiums superior to the Trustee and other Jernberg creditors. The Trustee also argues that PAC failed to comply with Illinois law that governs the formation of valid premium finance agreements. Specifically, the Trustee says that PAC failed to set forth the complete and correct insurance policy numbers and letters anywhere in the Finance Agreement. According to the Trustee, the Finance Agreement is invalid under Illinois law because PAC lacks an effective assignment of Jernberg's right to unearned premiums and any purported priority in the unearned premiums granted by law is vitiated. Finally, the Trustee argues that because the Insurance Policies prohibit assignment, absent prior written consent of the Insurers, PAC's failure to obtain their written consent renders its attempted assignment invalid. Court Rulings Rejecting the Trustee's arguments, Judge Squires held that: (1) secured transactions provisions of Illinois' version of the UCC don't apply to transaction in which the Debtors granted PAC a security interest in unearned premiums; (2) PAC did not have to file or record a financing statement to perfect its security interest in the insurance policies and unearned premiums; (3) PAC had a valid security interest in the unearned premiums; (4) the premium finance agreement substantially conformed to Illinois' statutory requirements for these agreements; (5) minor scrivener's errors in the insurance policy numbers listed in the premium finance agreement did not render the agreement ineffective; (6) PAC's security interest in the unearned premiums and its right to cancel the insurance policies were enforceable notwithstanding the Debtor's bankruptcy filing; and (7) the policies' anti-assignment clauses did not apply to PAC's statutory right to return the unearned premiums following policy cancellation. John Collen, Esq., at Duane Morris LLP, represented PAC in this matter. Headquartered in Chicago, Illinois, Jernberg Industries, Inc. (nka JII Liquidating, Inc.) was a press forging company that manufactured formed and machined products. The Company and its debtor-affiliates filed for chapter 11 protection on June 29, 2005 (Bankr. N.D. Ill. Case No. 05-25909). Jerry L. Switzer, Jr., Esq., at Jenner & Block LLP represented the Debtors. When the Debtors filed for protection from their creditors, they estimated assets and debts of $50 million to $100 million. The chapter 11 case was converted to a chapter 7 liquidation proceeding on Oct. 10, 2005, after KPS Special Situations Fund II completed the acquisition of substantially all of the company's assets. Michael M. Schmahl, Esq., and Patricia Smoots, Esq., at McGuireWoods LLP, and represent Richard J. Mason, who serves as the Chapter 7 Trustee. MACH ONE: Fitch Ups Rating on $8.8 Mil. Class K Certs. to BB+ ------------------------------------------------------------- Fitch upgrades these MACH ONE 2004-1 LLC, series 2004-1, commercial mortgage-backed securities pass-through certificates as: -- $51.5 million class B to 'AAA' from 'AA'; -- $10.5 million class C to 'AAA' from 'AA-'; -- $28.1 million class D to 'AA' from 'A'; -- $7.2 million class E to 'AA-' from 'A-'; -- $17.7 million class F to 'A' from 'BBB+'; -- $15.3 million class G to 'A-' from 'BBB'; -- $14.5 million class H to 'BBB' from 'BBB-'; -- $17.7 million class J to 'BBB-' from 'BB+'; -- $8.8 million class K to 'BB+' from 'BB'; These classes are affirmed: -- $92.3 million class A-1 at 'AAA'; -- $152 million class A-2 at 'AAA'; -- $146.8 million class A-3 at 'AAA'; -- Notional class X at 'AAA'; -- $8 million class L at 'BB-'; -- $8.8 million class M at 'B+'; -- $6.4 million class N at 'B'; -- $6.4 million class O at 'B-'; Fitch does not rate classes P-1 through P-6. The rating upgrades are the result of positive ratings migration of the underlying CMBS securities and collateral paydown since issuance. As of the July 2006 distribution date, the transaction has paid down 1.2% to $635.6 million from $643.3 million at issuance. There have been no realized losses to date. The certificates are collateralized by all or a portion of 59 classes of fixed-rate commercial mortgage-backed securities in 40 separate transactions. The current weighted average rating factor of the underlying bonds is 8.23 compared to 11.17 at Fitch's last rating action and 13.22 at issuance. The current WARF corresponds to an average rating of 'BBB-/BB+', an improvement from BB+/BB at issuance. The classes' ratings are based on Fitch's actual rating, or on Fitch's internal credit assessment for those classes not rated by Fitch. Delinquencies in the underlying transaction are: * 30 days: 0.2%; * 60 days: 0.1%; * 90+ days: 0.5%; * Foreclosure: 0.4%; and * real estate owned: 0.9%. MAIN LINE: Case Summary & 11 Largest Unsecured Creditors -------------------------------------------------------- Debtor: Main Line Realty Group, LLC 154 Cooper Road, Suite 203 West Berlin, New Jersey 08091 Bankruptcy Case No.: 06-17394 Chapter 11 Petition Date: August 9, 2006 Court: District of New Jersey (Camden) Debtor's Counsel: Barry W. Frost, Esq. Teich Groh 691 State Highway 33 Trenton, New Jersey 08619-4407 Tel: (609) 890-1500 Fax: (609) 890-6961 Total Assets: $4,822,665 Total Debts: $5,375,627 Debtor's 11 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Main Line Realty Inc. - Plans $1,711,007 c/o Kenneth DiLullo 27110 East Inspiration Drive Pioneer, CA 95666 Lineliv LP $1,401,960 c/o Steven Angstreich, Esq. Levy Angstreich Ten Melrose Avenue Cherry Hill, New Jersey 08003 Steliga Homes & Steliga $743,685 Related Entities 154 Cooper Road, Suite 203 West Berlin, NJ 08091 Estate of H.C. DiLullo $468,980 c/o Kenneth DiLullo 27110 East Inspiration Drive Pioneer, CA 95666 Naram Group LP $459,000 230 Cooper Road West Berlin, NJ 08091 Pinedge Development $150,000 Lineliv LP $130,000 Land & Ground Realty LLC $125,000 J.S. Consultant $87,000 Igor Sturm, Esq. Legal fees $58,500 J. Eric Kishbaugh, Esq. Legal fees $40,495 MARSH SUPERMARKETS: Earns $1.12 Mil. for First Fiscal Quarter 2007 ------------------------------------------------------------------ Marsh Supermarkets, Inc.'s net income for the first quarter of fiscal 2007, which ended June 24, 2006, was $1.12 million compared to net income of $674,000 for the first quarter of fiscal 2006. Operating income for the 2007 quarter was $7,098,000, which represented an increase of $1,709,000 or 31.7% over the fiscal 2006 quarter. "We are pleased to report a profit after three consecutive quarters of losses," Don E. Marsh, chairman and chief executive officer, said. "Our focus on controlling expenses helped to moderate the negative pressure on revenue caused by the effects of competition and the uncertainty in the marketplace regarding the outcome of the sale of the Company." For the first quarter of fiscal 2007, the Company disclosed total revenues of $401.6 million as compared to $409.8 million for the first quarter of fiscal 2006. The Company also disclosed that, as part of its ongoing efforts to reduce expenses and to improve its financial condition, it closed the Marsh supermarket located in Naperville, Illinois on July 22, 2006 and expects to incur accounting charges of approximately $5 million in the second quarter of fiscal 2007. Headquartered in Indianapolis, Indiana, Marsh Supermarkets, Inc. (Nasdaq: MARSA & MARSB) -- http://www.marsh.net/-- is a regional supermarket chain with stores primarily in Indiana and western Ohio, operating 69 Marsh(R) supermarkets, 38 LoBill(R) Food stores, eight O'Malias(R) Food Markets, 154 Village Pantry(R) convenience stores, and two Arthur's Fresh Market(R) stores. The Company also operates Crystal Food Services(SM) which provides upscale catering, cafeteria management, office coffee, coffee roasting, vending and concessions, and Primo Banquet Catering and Conference Centers; Floral Fashions(R), McNamara(R) Florist and Enflora(R) -- Flowers for Business. * * * As reported in the Troubled Company Reporter on May 8, 2006, Moody's Investors Service placed the ratings of Marsh Supermarkets, Inc., including the B3 Corporate Family Rating and Caa2 rating of 8.875% Senior Subordinated Notes due 2007 on review-direction uncertain. As reported in the Troubled Company Reporter on April 25, 2006, Standard & Poor's Ratings Services held its 'B-' corporate credit and 'CCC' subordinated debt ratings on Marsh Supermarkets Inc. on CreditWatch with developing implications. MORGAN STANLEY: Fitch Holds Low-B Ratings on Six Class Certs. ------------------------------------------------------------- Fitch Ratings upgrades these Morgan Stanley Capital I Trust, series 2004-RR2, commercial mortgage-backed securities pass- through certificates as: -- $30.2 million class B to 'AAA' from 'AA'; -- $15.1 million class C to 'A+' from 'A'; -- $5.3 million class D to 'A' from 'A-'; -- $12.2 million class E to 'BBB+' from 'BBB'; -- $3.3 million class F to 'BBB' from 'BBB-'. Fitch also affirms these classes: -- $90.6 million class A-1 'AAA'; -- $109.1 million class A-2 'AAA'; -- $Notional class X 'AAA'; -- $6.9 million class G 'BB+'; -- $3.7 million class H 'BB'; -- $2.5 million class J 'BB-'; -- $2.5 million class K 'B+'; -- $2.5 million class L 'B'; -- $1.6 class M at 'B-'. Classes N-1 through N-5 are not rated by Fitch. The rating upgrades reflect increased subordination levels as well as positive migration of the underlying CMBS securities. As of the July 2006 distribution date, the transaction has paid down 7.2% to $302.7 million from $326.1 million at issuance. The certificates are collateralized by all or a portion of 34 fixed-rate commercial mortgage-backed securities from 25 separate transactions. Five classes of the underlying securities have paid in full since issuance. The current weighted average rating factor of the underlying bonds is 12.02, corresponding to an average rating of 'BB+/BB', compared to 12.36 at issuance. The classes' ratings are based on Fitch's actual rating, or on Fitch's internal credit assessment for those classes not rated by Fitch. Delinquencies in the underlying transaction are: * 30 days: 0.2%; * 60 days: 0.2%; * 90+ days: 0.5%; * Foreclosure: 0.2%; and * real estate owned: 1%. MORGAN STANLEY: Fitch Affirms Low-B Ratings on Six Class Certs. --------------------------------------------------------------- Fitch affirms these Morgan Stanley Capital I Inc., Series 2005- RR6, commercial mortgage-backed securities pass-through certificates as: -- $87 million class A-1 'AAA'; -- $85.5 million class A-2FX 'AAA'; -- $80 million class A-2FL 'AAA'; -- $110.6 million class A-3FX 'AAA'; -- $60 million class A-3FL 'AAA'; -- Interest only class X 'AAA'; -- $50.1 million class A-J 'AAA'; -- $27.5 million class B 'AA'; -- $14.1 million class C 'A'; -- $2.1 million class D 'A-'; -- $8.5 million class E 'BBB+'; -- $4.2 million class F 'BBB'; -- $6.4 million class G 'BBB-'; -- $7.1 million class H 'BB+'; -- $2.8 million class J 'BB'; -- $2.8 million class K 'BB-'; -- $1.4 million class L 'B+'; -- $2.1 million class M 'B'; -- $1.4 million class N 'B-'. Fitch does not rate classes O-1 through O-6. The affirmations are the result of minimal changes to the ratings of the underlying securities, as well as the stable credit enhancement levels. There has been no principal paydown since issuance. The certificates are collateralized by all or a portion of 84 classes of fixed rate CMBS in 55 separate underlying CMBS transactions. The weighted average rating factor is 6.6 ('BBB/BBB-'), stable from issuance. The classes' ratings are based on Fitch's actual rating, or on Fitch's internal credit assessment for those classes not rated by Fitch. Delinquencies in the underlying transactions are: * 30 days (0.2%); * 60 days (0.1%); * 90 days or more (0.5%); * foreclosure (1.2%) and * REO (0.4%). NBTY INC: S&P Upgrades Bank Loan Rating to BB+ ---------------------------------------------- Standard & Poor's Ratings Services raised its bank loan rating for Bohemia, New York-based NBTY Inc., to 'BB+' from 'BB', and raised the recovery rating to '1' from '2'. At the same time, Standard & Poor's revised its outlook to stable from negative and affirmed the 'BB' corporate credit rating and all other ratings on NBTY. The '1' recovery rating indicates the expectation of a full recovery of principal in the event of a default. Approximately $227.4 million of total debt was outstanding at June 30, 2006. "The higher ratings reflect the expectation of lenders' full recovery of principal on the company's $160.4 million senior secured credit facility in a simulated payment default scenario because of a meaningful level of bank debt repayment over the past year," said Standard & Poor's credit analyst Alison Sullivan. "The outlook revision reflects the company's improved financial profile and credit measures resulting from reduced debt levels." NBTY repaid $207 million of debt in the first nine months of fiscal 2006 and an additional $10 million in July. The company is expected at minimum to maintain these lower debt levels and may further reduce leverage as a result of its continuing efforts to lower inventories and improve working capital. NBTY is a vertically integrated vitamin, mineral, and supplement manufacturer and marketer, with a strong retail presence in the U.K. S&P expects that continued promotional activity to capture market share will suppress material margin improvement through fiscal 2006. However, S&P expects margins to stabilize at the current levels over the near term and do not expect any further margin erosion. "In the event that the company's financial policy becomes more aggressive, or margins are further depressed, we could revise the outlook to negative," Ms. Sullivan said. NEWPARK RESOURCES: Moody's Rates New $150 Million Sr. Loan at B2 ---------------------------------------------------------------- Moody's Investors Service assigned a B2 rating to Newpark Resources, Inc.'s new $150 million five-year senior secured term loan facility. At the same time, Moody's affirmed Newpark's B1 Corporate Family Rating and B3 senior subordinated note rating. The rating outlook remains negative pending the filing of its financial statements for the last five fiscal years, as well as for the fiscal quarters within 2004 and 2005. Proceeds from the new term loan are being used to refinance Newpark's $125 million 8.625% senior subordinated notes and repay other debt. Moody's will withdraw the rating on the subordinated notes upon their redemption. The company's delay in filing its financial statements has resulted in it violating the financial reporting covenants under both its senior subordinated notes and its bank credit facility. On July 20, 2006, the company received a notice of default from more than 25% of the holders of its subordinated notes. Under the terms of the indenture, the company has 30 days to cure the default or risk having the notes accelerated. The company has received an extension of its financial statement delivery requirements from the lenders under its bank credit facility. Newpark is restating its financial statements for the last five fiscal years, as well as for the fiscal quarters within 2004 and 2005, due to accounting irregularities. The accounting irregularities, which were uncovered as part of routine internal audit procedures and prompted an internal investigation commissioned by the Audit Committee, primarily relate to the processing and payment of invoices by Soloco Texas, LP, one of the Newpark's subsidiaries in its mat and integrated services segment. The Audit Committee also commissioned an internal investigation into improper stock option granting practices, which uncovered findings of improper practices. The company estimates the impact of the restatement will impact pretax income by approximately $12 million. The company found cause for the termination of the CFO and the former CEO, who was at the time the chairman and CEO of Newpark Environmental Water Services, LLC, and an officer of Soloco Texas, LP, due to their responsibility for many of the actions uncovered. In addition, Newpark's COO resigned; however, the resignation appears unrelated to the investigation. On July 7, 2006 Moody's downgraded Newpark's Corporate Family Rating to B1 from Ba3 and the rating on the company's senior subordinated notes to B3 from B2 reflecting Moody's concern that the restatements stem from weak corporate governance and internal controls, uncertainty regarding the integrity of Newpark's financial information, the expectation that the restatements and the disruption at the senior management level have and will continue to create significant management distractions, the heightened risk of potential costly litigation and fines, and increased risk that the company's reputation and relationship with its customers could be impaired. While Moody's views favorably the company's willingness to take quick, strong action in response to the accounting irregularities and notes that the financial impact of the restatements appears modest, these factors were unable to offset the risks associated with a weak governance and internal control environment at the higher rating category. Prior to the rating action, Moody's had a negative rating outlook on the company, which had reflected both the company's announcement that it was conducting an internal investigation regarding accounting irregularities and Moody's concern that Newpark's margins and returns have been lower than its similarly rated peers. The negative outlook reflects Moody's concern that the time to complete the restatements could be considerable. In addition, with any such investigation, the possibility remains that additional issues and concerns will be identified, which could expand the investigation's original scope. Should the delay in completing the financial statements become extended materially beyond September, 2006 and if Moody's determines that it lacks sufficient financial information to appropriately monitor the company's credit, the ratings could be withdrawn. If further material accounting irregularities are uncovered, the company faces material fines and legal liabilities, or the company fails to continue receiving support form its lender group the ratings may either be placed on review for possible downgrade or downgraded. The outlook could move to stable if the company is able to file its restated financial statements with the SEC in the near-term and it becomes current on its quarterly financial statement filings. However, the rating and outlook would be subject to a full review of the company and the audited financial statements, including an assessment of Newpark's credit profile, particularly in respect to its margins and returns. Newpark's B1 Corporate Family Rating reflects the company's relatively small scale; the inherent volatility of the oilfield services sector and the sensitivity of the company's drilling fluids business to the level of drilling activity; its continued, albeit improving, geographic concentration in the mature US Gulf Coast market; the highly competitive nature of the oilfield service industry; the risk of changes in the oilfield waste regulatory environment and potential environmental liability exposure; and the challenges management faces to in order to improve both its profitability and its governance and internal control environment. The B1 rating is supported by the company's product diversification across drilling fluids, E&P waste treatment, and mat sales and rentals; its sound and growing market position in drilling fluids; expected continued strong demand for oilfield services over the near-term; the company's substantial knowledge and operating experience in the oilfield waste disposal business; and the company's improved financial leverage profile. The new term loan is notched down one notch from the Corporate Family Rating level given that it does not have a first security interest in all of the assets of the company. The term loan lenders will have a first lien on all long-term assets and a second lien position on inventory and receivables assets behind the senior secured revolving credit facility, which the company plans to upsize to $90 million. While Moody's ascribes some value to the term loan's first lien collateral pool, we believe there is considerable uncertainty regarding future valuations. Moody's views the collateral pool to be illiquid, which, in the event of distress, could significantly impact valuations. Moody's do not attribute much value to the second lien position on inventory and receivables as the first lien holders will be able to block the second lien lenders from exercising remedies for 180 days in a default scenario, the second lien lenders will not object to the value of the first lien claims, and the revolver could be further upsized. The term loan facility is guaranteed by Newpark's existing and future domestic subsidiaries. The term loan facility will have minimal amortization but is expected to have a cash sweep mechanism that would require a portion of free cash flow to be applied toward debt reduction, and sets mandatory pre-payments with proceeds from capital markets financings and asset sales. Financial covenants under the facility are expected to include a leverage ratio and interest coverage ratio. Newpark Resources, Inc. is headquartered in Metarie, Louisiana. NORD RESOURCES: Gets Maturity Extension on $4.9 Mil. Secured Loan ----------------------------------------------------------------- Nord Resources Corporation, Auramet Trading, LLC, and Nedbank Limited, agreed to extend the maturity date under the Amended and Restated Promissory Note pursuant to a letter agreement dated August 8, 2006. The maturity is extended to the earlier of: (a) September 30, 2006; and (b) the closing of a registered equity offering by the Company which raises not less than $20,000,000. The Amended and Restated Promissory Note was to have matured on August 15, 2006. All other terms of the secured loan remain in full force and effect. Accordingly, the Company continues to be obligated to make interest-only payments to Nedbank, at an interest rate of 10% per annum, payable monthly. The interest rate would increase to 13% in the event of a default by the Company. Promissory Note On May 31, 2006, Auramet Trading, acting through Nedbank Limited, advanced an additional $ million loan to the Company. This amount was added to the outstanding principal under the then existing secured loan from Nedbank to the Company in the original principal amount of $3.9 million. Auramet had participated in the original loan through the contribution of a then outstanding loan from Auramet to the Corporation in the amount of $1 million, dated October 17, 2005. Upon closing of the additional $1 million advance, the Company executed and delivered, among other things, an Amended and Restated Secured Promissory Note dated May 31, 2006, payable to Nedbank in the principal amount of $4.9 Million. A copy of the extension agreement is available for free at: http://ResearchArchives.com/t/s?f8d About Nord Resources Headquartered in Dragoon, Arizona, Nord Resources Corporation -- http://www.nordresources.com/-- is a natural resource company focused on near-term copper production from its Johnson Camp Mine and the exploration for copper, gold and silver at its properties in Arizona and New Mexico. The Company also owns approximately 4.4 million shares of Allied Gold Limited, an Australian company. In addition, the Company maintains a small net profits interest in Sierra Rutile Limited, a Sierra Leone, West African company that controls the world's highest-grade natural rutile deposit. * * * Mayer Hoffman McCann PC expressed substantial doubt about Nord's ability to continue as a going concern after it audited the Company's financial statements for the years ended Dec. 31, 2005 and 2004. The auditing firm pointed to the Company's significant operating losses. Nord incurred a $3,084,166 net loss for the year ended Dec. 31, 2005, in contrast to a $864,357 net loss in the prior year. NORTHSHORE ASSET: Furniture & Antique Auction Tomorrow, Aug. 15 --------------------------------------------------------------- Eliot B. Millman Co. Auctioneers LLC, hired by Arthur Steinberg, the court-appointed Receiver for Northshore Asset Management, LLC, and its debtor-affiliates, will auction the contents of a mansion located at 229 Stanwich Road in Greenwich, Conn., at 11:30 a.m. on Tuesday, August 15, 2006. The sale includes: Antique and Fine Furniture: -- a 1901 Mason Hamlin parlor grand piano; -- a country Hepplewhite cherry side board; -- leather club chairs and a tufted ottoman; -- a large Mill House Regency yew wood breakfront; -- a cranberry mohair sofa; -- a down tapestry sofa and side chair; -- a burlwood folding game table; -- a tilt-top mahogany pie crust table; -- a walnut pedestal table with mahogany inlay; -- a drop leaf table; -- a leather side chair; -- an English yew wood leather-top partners' desk; Rugs: -- a 14' x 20' hand-made Indian rug; -- a 9' x 12' Sino Persian rug; -- a 7' x 7' Yalamah Persian rug; -- a 6' x 9' Kilim rug; Other Antiques: -- a carved wood rocking horse; -- an antique clock; -- a marble statue; -- framed art and paintings; and -- decorative accessories. Headquartered in Chicago, Illinois, Northshore Asset Management LLC provides investment management services to private equity and hedge funds and sophisticated investors. On Feb. 15, 2005, Northshore, NSCT LLC and Saldutti Capital Management, LP, filed for chapter 11 protection (Bankr. N.D. Ill. Case Nos. 05-04950, 05-04958 and 05-04959). On February 16, 2005, the U.S. District Court for the Southern District of New York appointed Arthur Steinberg as receiver. On March 29, 2005, the Honorable Pamela S. Hollis in Chicago ordered the transfer of the Debtors' chapter 11 cases to the U.S. Bankruptcy Court for the Southern District of New York (Bankr. Case Nos. 05-12797 through 05-12799), and the U.S. District Court for the Southern District of New York withdrew the reference of those cases from the bankruptcy court to consolidate all proceedings in one forum. Jon C. Vigano, Esq., Patricia J. Fokuo, Esq., at Schiff Hardin LLP represents the Debtors. When the Debtors filed for protection from their creditors, they estimated assets and debts ranging from $10 million to $50 million. Arthur Steinberg, Esq., at Kaye Scholer LLP, serves as the Receiver. Additional information about this proceeding is available on-line at http://www.northshoreupdate.com/ NORTHWESTERN CORP: Posts $2.4 Mil. Net Loss in 2nd Quarter 2006 --------------------------------------------------------------- For the three months ended June 30, 2006, Northwestern Corp. reported net loss of $2,446,000 from operating revenues of $232,186,000. The Company's balance sheet at June 30, 2006 showed strained liquidity with $234,104,000 in total current assets and $363,289,000 in total current liabilities. At June 30, 2006, the Company had total assets of $2,329,847,000, total liabilities of $1,590,055,000 and total shareholders' equity of $739,792,000. A full-text copy of the Company's financial report for the quarter ended June 30, 2006 is available for free at: http://researcharchives.com/t/s?f36 About NorthWestern Energy Headquartered in Sioux Falls, South Dakota, NorthWestern Energy (NASDAQ:NWEC) -- http://www.northwesternenergy.com/-- provides electricity and natural gas in the Upper Midwest and Northwest, serving approximately 628,500 customers in Montana, South Dakota and Nebraska. * * * As reported in the Troubled Company Reporter on Apr. 28, 2006, Standard & Poor's Ratings Services revised its CreditWatch implications on the 'BB+' corporate credit rating on electric and gas utility NorthWestern Corp. to negative from developing following the announcement that Babcock & Brown Infrastructure Ltd. will acquire NorthWestern for $2.2 billion. The ratings were originally placed on CreditWatch developing on Dec. 6, 2005, after Black Hills Corp. offered to acquire NorthWestern. NRG ENERGY: Two Subsidiaries Commence $500 Million Stock Purchase ----------------------------------------------------------------- NRG Energy, Inc., disclosed that two of its wholly owned subsidiaries, NRG Common Stock Finance I, LLC, and NRG Common Stock Finance II, LLC, will use up to $500 million to purchase shares of the Company's common stock in the open market or in privately negotiated transactions. The reference period is expected to be complete when the subsidiaries have paid an aggregate of $500 million in connection with the purchases. CSF I and CSF II will make purchases of the Company's common stock during the reference period using an equity contribution from the Company, which is expected to be approximately $166 million in the aggregate, together with up to $84 million funded through the issuance of preferred equity and up to $250 million funded through the issuance of debt from units of Credit Suisse. Neither the debt of nor the preferred equity interests in the subsidiaries will be recourse to the Company or its restricted subsidiaries and the debt will be secured by shares of the Company's common stock purchased during the reference period. The agreements specify that purchases shall be made under the program at the sole discretion of the Company. The Company further disclosed that, the transactions with CSF I will have a term of approximately two years and the transactions with CSF II will have a term of approximately three years. At maturity, each subsidiary will be obligated to repay all amounts due under the notes and preferred units and the affiliate of Credit Suisse will have the right to exchange the preferred units and notes they purchased for an additional payment equal to the excess of the market value of the Company's common stock owned by such subsidiary over a threshold amount. NRG Energy, Inc. (NYSE: NRG) -- http://www.nrgenergy.com/-- presently owns and operates a diverse portfolio of power- generating facilities, primarily in Texas and the Northeast, South Central and Western regions of the United States. Its operations include baseload, intermediate, peaking, and cogeneration facilities, thermal energy production and energy resource recovery facilities. NRG also has ownership interests in generating facilities in Australia and Germany. ODYSSEY RE HOLDINGS: Earns $202 Million in Quarter Ended June 30 ---------------------------------------------------------------- Odyssey Re Holdings Corp. reported net income available to common shareholders of $202.4 million for the quarter ended June 30, 2006, compared to $51.1 million for the quarter ended June 30, 2005. Net income available to common shareholders for the six months ended June 30, 2006 was $361.8 million, compared to $82.6 million for the comparable period of 2005. Total shareholders' equity was $1.83 billion at June 30, 2006, an increase of $208.5 million compared to total shareholders' equity of $1.62 billion at Dec. 31, 2005. Commenting on the second quarter, Andrew A. Barnard, the Company's president and chief executive officer, stated, "We achieved the highest level of earnings this quarter in our history as we continued to benefit from solid underwriting and investment performance. Book value per share has increased 13.6% to date in 2006, allowing us to continue the momentum in compounding book value by 15% over the long term." Odyssey Re Holdings Corp. is an underwriter of property and casualty treaty and facultative reinsurance, as well as specialty insurance. OdysseyRe operates through its subsidiaries, Odyssey America Reinsurance Corporation, Hudson Insurance Company, Hudson Specialty Insurance Company, Clearwater Insurance Company, Newline Underwriting Management Limited and Newline Insurance Company Limited. The Company underwrites through offices in the United States, London, Paris, Singapore, Toronto and Latin America. Odyssey Re Holdings Corp. is listed on the New York Stock Exchange under the symbol ORH. * * * Odyssey Re Holdings Corp.'s preferred stock rating carries Ba2 from Moody's and BB from Fitch. The Company's senior unsecured debt and long-term issuer default ratings also carry BB+ from Fitch. Moody's placed its rating on Oct. 12, 2005 with a stable outlook. Fitch placed its ratings on March 23, 2006. ON SEMICONDUCTOR: Earns $67.5 Million in Second Quarter of 2006 --------------------------------------------------------------- For the second quarter of 2006, ON Semiconductor Corp. reported net income of $67.5 million compared to net income of $40.4 million the first quarter of 2006. The Company's total revenues for the second quarter of 2006 is $375.3 million, an increase of 12 percent from the first quarter 2006 total revenues. Commenting on the results, Keith Jackson, ON Semiconductor's president and chief executive officer, said, "The second quarter was another strong quarter for ON Semiconductor. Our improving mix, new product introductions and cost competitive manufacturing capabilities helped drive record quarterly gross margin percentage, net income and earnings per share. "During the second quarter we also grew cash and cash equivalents by approximately $43 million to a record high balance of approximately $295 million. Going forward, we look to continue our success and have focused the company on accelerating the growth of our power solutions portfolio," Mr. Jackson added. "As part of this effort, beginning in the third quarter, we have re- aligned the company into four market-based divisions, the Digital and Consumer Products Group, the Computing Products Group, the Automotive and Power Regulation Group and the Standard Products Group. We believe this new organizational structure will enable ON Semiconductor to continue to expand its development of innovative power solutions for customers in these key markets." About ON Semiconductor ON Semiconductor -- http://www.onsemi.com/-- supplies power solutions to engineers, purchasing professionals, distributors and contract manufacturers in the computer, cell phone, portable devices, automotive and industrial markets. * * * ON Semiconductor Corp.'s bank loan debt and long-term corporate family rating carry Moody's B2 ratings. The ratings were placed on Dec. 15, 2005 with a positive outlook. In June of the same year, Standard & Poor's placed the Company's long-term local and foreign issuer credit ratings at B+ with a stable outlook. ORION HEALTHCORP: Posts $480,000 Net Loss in 2006 Second Quarter ---------------------------------------------------------------- Orion HealthCorp, Inc. (AMEX: ONH) reported financial results for the second quarter and six months ended June 30, 2006. "We continue to make progress on a number of fronts. During the second quarter, we were EBITDA positive, demonstrating that our cost controls and consolidation efforts are producing the desired results" Terrence L. Bauer, chief executive officer of Orion HealthCorp, said. "Also, we are hard at work executing our business plan that, in addition to reducing costs, includes strategic growth initiatives. We have identified several acquisition candidates that we believe would complement our existing revenue cycle management business and are discussing potential transactions. Halfway through 2006, we believe we are well-positioned with positive momentum for the remainder of the year." The results for the three months and six months ended June 30, 2006 and 2005, respectively, include the consolidated results of Orion HealthCorp, with two of its business units: Integrated Physician Solutions, Inc., and Medical Billing Services, Inc. The surgery center business operated under the name "SurgiCare" is reported as discontinued operations for the three months and six months ended June 30, 2006 and 2005. For the three months ended June 30, 2006, net operating revenues were $6.9 million compared with $7.7 million for the same period in the prior year. Loss from continuing operations was $481,000 for the second quarter of 2006 compared with a loss from continuing operations of $7.8 million including a charge for impairment of intangible assets and goodwill of $6.4 million, for the prior year period. Net loss, including income from discontinued operations of $968, was $480,000 for the second quarter of 2006 compared with a net loss, including a loss from discontinued operations of $540,000, of $8.3 million for the quarter ended June 30, 2005. Earnings before interest, taxes, depreciation and amortization totaled $54,000 for the second quarter of 2006. For the six months ended June 30, 2006, net operating revenues were $14.1 million compared with $15.3 million for the same period in the prior year. Loss from continuing operations was $285,000 for the first six months of 2006 compared with a loss from continuing operations of $9.2 million including the aforementioned charge for impairment of intangible assets and goodwill, for the same period in 2005. Net income, including income from discontinued operations of $576,000, was $291,000 for the first half of 2006 compared with a net loss, including a loss from discontinued operations of $821,000, of $10 million for the first half of 2005. EBITDA totaled $116,000 for the first six months of 2006 compared with an EBITDA loss of $946,000 for the prior year period. About Orion HealthCorp Orion HealthCorp, Inc. -- http://www.orionhealthcorp.com/-- is a healthcare services organization resulting from a recent combination of four different operating companies. The Company provides complementary business services to physicians through three business units: SurgiCare, Inc., serving the freestanding ambulatory surgery center market; Integrated Physician Solutions, Inc., providing business services to pediatric practices and technology solutions to general and specialized medical practices; and Medical Billing Services, Inc., providing physician billing and collection services and practice management solutions to hospital-based physicians. The core competency of the Company is its long-term experience and success in working with and creating value for physicians. Going Concern Doubt UHY Mann Frankfort Stein and Lipp CPAs, LLP, in Houston, Texas, raised substantial doubt about Orion HealthCorp's ability to continue as a going concern after auditing the Company's consolidated financial statements for the year ended Dec. 31, 2005. The auditor pointed to the Company's recurring losses from operations and negative cash flows. OVERSEAS SHIPHOLDING: Discloses Partnership with TransCanada ------------------------------------------------------------ Overseas Shipholding Group, Inc. disclosed a strategic partnership agreement with TransCanada CNG Technologies Ltd, a subsidiary of TransCanada Corporation. Under the agreement, the Company will own and operate a new type of tanker vessel, capable of moving large quantities of compressed natural gas using TransCanada's patented technology for the design, construction and operation of Gas Transport Modules for the transportation of CNG from stranded gas fields throughout the world. Morten Arntzen, president and chief executive officer, said, "We are very excited about working with TransCanada on both the development of these unique gas carriers and the projects for which they are intended. As the world seeks alternative energy resources and fuel substitutions, this proprietary technology is a real breakthrough for facilitating the recovery of natural gas from fields that were once not cost effective to reach." Mr. Arntzen continued, "Combining TransCanada's unique technology with OSG's in-depth knowledge of marine transportation and vessel construction, will enable our respective companies to be the first to develop an efficient and commercially viable CNG vessel." About TransCanada TransCanada (NYSE, TSX: TRP) is a leader in the responsible development and reliable operation of North American energy infrastructure. TransCanada's network of more than 41,000 kilometres (25,600 miles) of wholly owned pipeline transports the majority of Western Canada's natural gas production to key Canadian and U.S. markets. A growing independent power producer, TransCanada owns, or has interests in, approximately 6,700 megawatts of power generation in Canada and the United States. About OSG Overseas Shipholding Group, Inc. (NYSE:OSG) -- http://www.osg.com/-- is one of the largest publicly traded tanker companies in the world with an owned, operated and newbuild fleet of 117 vessels, aggregating 13.0 million dwt and 865,000 cbm, as of June 30, 2006. As a market leader in global energy transportation services for crude oil and petroleum products in the U.S. and International Flag markets, the Company is committed to setting high standards of excellence for its quality, safety and environmental programs. OSG is recognized as one of the world's most customer-focused marine transportation companies, with offices in New York, Athens, London, Newcastle and Singapore. * * * As reported in the Troubled Company Reporter on Aug. 9, 2006, Moody's Investors Service affirmed the debt ratings of Overseas Shipholding Group, Inc.'s Senior Unsecured at Ba1. The outlook has been changed to stable from negative. PARMALAT: Parma Court Approves Boschi's Composition of Creditors ---------------------------------------------------------------- The Court of Parma entered an order validating the Composition with Creditors proposed by the Extraordinary Commissioner of Boschi Luigi e Figli S.p.A. in Extraordinary Administration pursuant to art. 4 bis of Law No. 166 of July 5, 2004, and Legislative Decree No 119 of May 3, 2004, as amended. Due to the validation of the Composition with Creditors, Boschi Luigi e Figli S.p.A. is no longer considered insolvent and will be included in the area of consolidation of the Parmalat Group starting from the third quarter 2006. Headquartered in Wallington, New Jersey, Parmalat USA Corporation -- http://www.parmalatusa.com/-- generates more than 7 billion euros in annual revenue. The Parmalat Group's 40-some brand product line includes milk, yogurt, cheese, butter, cakes and cookies, breads, pizza, snack foods and vegetable sauces, soups and juices and employs over 36,000 workers in 139 plants located in 31 countries on six continents. The Company filed for chapter 11 protection on February 24, 2004 (Bankr. S.D.N.Y. Case No. 04-11139). Gary Holtzer, Esq., and Marcia L. Goldstein, Esq., at Weil Gotshal & Manges LLP, represent the Debtors. When the U.S. Debtors filed for bankruptcy protection, they reported more than $200 million in assets and debts. The U.S. Debtors emerged from bankruptcy on April 13, 2005. (Parmalat Bankruptcy News, Issue No. 75; Bankruptcy Creditors' Service, Inc., 215/945-7000, http://bankrupt.com/newsstand/) PARMALAT: Court Allows Investors to File Third Amended Complaint ---------------------------------------------------------------- The U.S. District Court for the Southern District of New York allowed the class plaintiffs of the "Parmalat Securities Litigation" to file a Third Amended Complaint, which includes [the new] Parmalat SpA among the defendants. Said class action is pending now for over two years in front of the District Court. The judge has denied certification in his July 21, 2006 ruling. Other defendants in the class action are Deloitte & Touche (and, as an individual, Mr. James Copeland), Grant Thornton, Citigroup (including Buconero, Vialattea, Eureka Securitization), Bank of America, Credit Suisse, Banca Nazionale del Lavoro, Banca Intesa, Morgan Stanley, the law offices of Pavia Ansaldo and of Zini Associates, and number of individuals. Defendants may conduct discovery with respect to class certification until Sept. 21, 2006. A full-text copy of the District Court Order is available for free at http://researcharchives.com/t/s?f6c About Parmalat Headquartered in Wallington, New Jersey, Parmalat USA Corporation -- http://www.parmalatusa.com/-- generates more than 7 billion euros in annual revenue. The Parmalat Group's 40-some brand product line includes milk, yogurt, cheese, butter, cakes and cookies, breads, pizza, snack foods and vegetable sauces, soups and juices and employs over 36,000 workers in 139 plants located in 31 countries on six continents. The Company filed for chapter 11 protection on February 24, 2004 (Bankr. S.D.N.Y. Case No. 04-11139). Gary Holtzer, Esq., and Marcia L. Goldstein, Esq., at Weil Gotshal & Manges LLP, represent the Debtors. When the U.S. Debtors filed for bankruptcy protection, they reported more than $200 million in assets and debts. The U.S. Debtors emerged from bankruptcy on April 13, 2005. (Parmalat Bankruptcy News, Issue No. 75; Bankruptcy Creditors' Service, Inc., 215/945-7000, http://bankrupt.com/newsstand/) PAXAR CORP: Earns $14.6 Million in Second Quarter of 2006 --------------------------------------------------------- Paxar Corporation reported net income of $14.6 million for the second quarter of 2006, compared to net income of $14.4 million, for the second quarter of 2005. The Company's sales for the second quarter of 2006 is $233.3 million, compared with sales of $214.5 million for the second quarter of 2005. Six Months 2006 Results For the first six months of 2006, the Company reported sales of $432.9 million compared with sales of $401.7 million for the first six months of 2005. Net income of $19.8 million was reported for the first six months of 2006, versus net income of $19.7 million for the first six months of 2005. Commenting on the results, Rob van der Merwe, the Company's president and chief executive officer, said, "Our strong second quarter growth was a continuation of demand for our merchandising and supply chain solutions globally, and I am pleased to report excellent continuing organic growth throughout the first half of 2006. I am also pleased with the underlying strength of volumes flowing through our businesses and regions as well as progress made to realign our resources to better service our customers." Mr. van der Merwe continued, "During the second quarter we made good progress in the realignment of apparel identification production in our European operations and initiated further steps to shift US-based apparel capacity offshore. This program will continue throughout the balance of the year and into the latter part of 2007, resulting in Paxar being better able to support its customers, globally. Due to progress made in executing the initial phase of our global realignment plan, as anticipated, we incurred some up-front costs, which along with costs associated with the rapid expansion in our Asia Pacific operations, negatively impacted reported margins in the quarter. We also experienced lower margins on certain new products which are in their initial ramp-up phase." Paxar Corporation -- http://www.paxar.com/-- provides identification solutions to the retail and apparel industry, worldwide. * * * Paxar Corp.'s senior unsecured debt carries Moody's B1 rating. Moody's placed the rating on Dec. 23, 1996. PEOPLE'S CHOICE: Fitch Rates $19.06 Million Class Certs. at BB+ --------------------------------------------------------------- Fitch rates these People's Choice Mortgage Pass-Through Certificates, Series 2006-1, as: -- $788.99 million classes 1A1 through 1A4, 2A1 and 2A2 'AAA'; -- $36.62 million class M1 'AA+'; -- $33.60 million class M2 'AA'; -- $20.06 million class M3 'AA-' -- $18.06 million class M4 'A+'; -- $16.55 million class M5 'A'; -- $15.55 million class M6 'A-'; -- $14.55 million class M7 'BBB+'; -- $12.54 million class M8 'BBB'; -- $6.52 million class M9 'BBB'; -- $12.04 million class M10 'BBB-'; -- $9.03 million class B1 'BBB-'; -- $19.06 million class B2 'BB+'. The 'AAA' rating on the senior certificates reflects the 24.15% total credit enhancement provided by the 3.65% class M1, the 3.35% class M2, the 2.00% class M3, the 1.80% class M4, the 1.65% class M5, the 1.55% class M6, the 1.45% class M7, the 1.25% class M8, the 0.65% class M9, the 1.20% class M10, the 0.90% class B1, the 1.90% class B2 and the growing overcollateralization (OC) amount of 2.80%. All certificates have the benefit of monthly excess cash flow to absorb losses. In addition, the ratings reflect the integrity of the transaction's legal structure as well as the capabilities of Wells Fargo Bank, National Association as Master Servicer and EMC Mortgage Corporation as Servicer. HSBC Bank USA, National Association will act as Trustee. The collateral pool consists of 4,456 fixed-rate and adjustable- rate mortgage loans with and initial aggregate principal balance of approximately $1,003,167,728 secured by first and second liens. As of the cut-off-date, the weighted average combined loan-to- value ratio (CLTV) of the collateral pool was 82.27% and the weighted average credit score was 650. The average balance was $225,127 and the pool had a weighted average interest rate of 8.169%. The weighted average original term to maturity was 355 months. California (31.81%), Florida (15.35%), and New York (9.49%) comprise the top three state concentrations. PICTURESQUE LLC: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Picturesque, L.L.C. dba Simply Artrageous aka Artrageous Home Decor 5900 North Granite Reef Road, #200 Scottsdale, Arizona 85250 Bankruptcy Case No.: 06-02461 Type of Business: The Debtor specializes in carrying of art images to decorate walls with, including oils, prints, giclees, tapestries, lithographs, originals, photographs and posters. In addition, the Debtor carries mirrors, wall clocks, sculptures, lamps, accent furniture, unique fountains, and beautiful custom aquariums. See http://shop.simplyartrageous.com/ Chapter 11 Petition Date: August 8, 2006 Court: District of Arizona (Phoenix) Judge: Eileen W. Hollowell Debtor's Counsel: Dale C. Schian, Esq. Mark C. Hudson, Esq. Michael P. Thieme, Esq. Schian Walker P.L.C. 3550 North Central Avenue #1500 Phoenix, Arizona 5012-2188 Tel: (602) 285-4550 Fax: (602) 297-9633 Estimated Assets: $1 Million to $10 Million Estimated Debts: $1 Million to $10 Million Debtor's 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Art Connection Trade Debt $213,980 2860 Centerport Circle Pompano Beach, FL 33064 Amy Waite/John Doucet Promissory Note $200,000 11 White Oak Lane Quakerhill, CT 06375 Uma Aggarwal Promissory Note $100,000 9792 Old Warson Road Ladue, MO 63124 Global Link Logistics Trade Debt $84,706 ITCube, L.L.C. Trade Debt $78,149 Sklar Peppler Trade Debt $74,396 Arizona Republic Advertising $73,872 Customer Account Services Southern Furniture Co. Trade Debt $63,341 Picture Galleries Trade Debt $44,376 A-America Furniture Co. Trade Debt $41,968 Ariel of France Trade Debt $38,310 Regency House Inc. Trade Debt $34,338 Cristo Rey Trade Debt $25,280 Deljou Art Group Trade Debt $20,527 Phillips Collection Trade Debt $18,532 John Richard Trade Debt $18,065 Cities West Publishing Advertising $17,738 Howard Miller Trade Debt $16,488 Denver Newspaper Agency Advertising $14,677 Stylecraft Home Collection Trade Debt $14,592 PRESCIENT APPLIED: Stockholders Gives Nod on TAK Settlement Pact ---------------------------------------------------------------- Holders of Prescient Applied Intelligence, Inc.'s Series E Convertible Preferred Stock approved a settlement agreement with TAK Investments, LLC and one of its affiliates concerning an ongoing dispute with respect to Prescient's outsourcing agreement with TAK. As reported in the Troubled Company Reporter on Aug. 3, 2006, the Company entered into a settlement agreement with Tak Investments, and an affiliate that provides: -- Termination of the outsourcing agreement; -- Cancellation of TAK's equity securities in Prescient -- A mutual general release by TAK and Prescient of all claims against each other; -- A three year secured approximately $2.6 million promissory note issued by Prescient to TAK that bears interest at the prime rate plus 2%, which is payable at a rate of $30,000 per month with the remaining amount due at the end of the three year period; -- A warrant issued to TAK to purchase 1,000,000 shares of Common Stock in Prescient at an exercise price equal to the closing share price of Prescient's common stock on the day immediately preceding the date of the grant plus 10%. The warrant expires on December 31, 2006. About Prescient Based in West Chester, Pa., Prescient Applied Intelligence, Inc. (OTCBB:PPID) -- http://www.prescient.com/-- provides supply chain and advanced commerce solutions for retailers and suppliers. founded in 1985, Prescient's solutions capture information at the point of sale, provide greater visibility into real-time demand and turn data into actionable information across the entire supply chain. Going Concern Doubt Amper, Politziner & Mattia P.C. expressed substantial doubt Prescient's ability to continue as a going concern after it audited the Company's financial statements for the years ended Dec. 31, 2005. The auditing firm pointed to the Company's recurring losses from operations and resulting dependence upon access to additional external financing. PROGRESS RAIL: Notes Redemption Prompts S&P to Withdraw Ratings --------------------------------------------------------------- Standard & Poor's Ratings Services withdrew its ratings on Progress Rail Services Holdings Corp., PRSC Acquisition Corp., and PMRC Acquisition Co., including its 'B+' corporate credit rating. The ratings were removed from CreditWatch, where they were originally placed with positive implications on March 22, 2006. The ratings withdrawal follows the redemption of the remaining $77 million (out of an original $200 million par value) of the company's 7.75% senior unsecured notes. The debt redemption was undertaken as part of the acquisition of the company by Caterpillar Inc. (A/Stable/A-1). PSS WORLD: Good Performance Prompts S&P to Upgrade Ratings ---------------------------------------------------------- Standard & Poor's Ratings Services raised its ratings on Jacksonville, Florida-based PSS World Medical Inc. The corporate credit rating was raised to 'BB' from 'BB-'. The rating outlook is stable. "The rating upgrade reflects the company's successful restructuring efforts, which have contributed to profitability growth; its relatively conservative growth strategy; and an improved financial risk profile since we revised the rating outlook to positive from stable in December 2003," said Standard & Poor's credit analyst Jesse Juliano. The rating on PSS reflects the company's narrow operating focus as a niche distributor of medical products to alternate-site health care providers and the current weakness in its elder care business. Partially offsetting these concerns are PSS's leading position in its niche markets, its successful restructuring efforts, identifiable opportunities for sales growth and improved profitability, and its significant supplier and client diversity. Financial metrics are strong for the rating category, and are robust relative to Standard & Poor's medians for the 'BB' rating category. EBITDA interest coverage is expected to be more than 10x (versus the 3.5x median), total lease-adjusted debt to EBITDA is expected to be around 2.0x (versus the 3.5x median), and funds from operations to lease-adjusted debt is expected to be more than 40% (versus the 22.4% median). PSS's financial risk profile provides some flexibility for unforeseen operating shortfalls, moderate-size acquisitions to seize growth opportunities, or share repurchase activity. QUANTA CAPITAL: In Talks with Lenders to Amended Credit Facility ---------------------------------------------------------------- Quanta Capital Holdings Ltd. continues to work with its lenders regarding an amendment to its credit facility and an extension to its waiver period, which expired Aug. 11, 2006. On June 7, 2006, A.M. Best Co. downgraded the financial strength ratings to B from B++ and the issuer credit ratings to bb from bbb for the insurance/reinsurance subsidiaries of Quanta Capital Holdings Ltd. These rating actions apply to Quanta Reinsurance Ltd., its subsidiaries and Quanta Europe Ltd. A.M. Best also downgraded Quanta's ICR to b from bb and the securities rating to ccc from b+ for its $75 million 10.25% Series A non-cumulative perpetual preferred shares. All ratings have been removed from under review with negative implications and assigned a negative outlook. Subsequently, all ratings of Quanta will be withdrawn and the FSRs will be assigned a rating of NR-4 in response to management's request that Quanta be removed from A.M. Best's interactive rating process. The company disclosed that the A.M. Best rating action triggered a default under Quanta's credit facility. About the Company Headquartered in Hamilton, Bermuda, Quanta Capital Holdings Ltd. (NASDAQ: QNTA) -- http://www.quantaholdings.com/-- operates its Lloyd's syndicate in London and its environmental consulting business through Environmental Strategies Consulting (ESC) in the United States. The Company is in the process of running off its remaining business lines. The Company maintains offices in Bermuda, the United Kingdom, Ireland and the United States. QUIGLEY COMPANY: Plan Misses 75% 524(g) Acceptance Requirement -------------------------------------------------------------- Quigley Company, Inc., failed to obtain acceptance of its Third Amended Plan of Reorganization from 75% of the holders of asbestos-related personal injury claims who voted to accept or reject the company's plan. That 75% acceptance rate is required to confirm a chapter 11 plan centered around a trust formed under 11 U.S.C. Sec. 524(g) to future resolution of asbestos-related claims. Quigley's Plan, as reported in the Troubled Company Reporter, proposes to resolve all liability for all Asbestos PI Claims by channeling them to an Asbestos PI Trust to be established on the effective date. The Honorable Stuart M. Bernstein has called off a previously scheduled confirmation hearing to let the parties regroup and figure out how to move forward. Headquartered in Manhattan, Quigley Company, Inc., is a subsidiary of Pfizer, Inc., which used to produce and market a broad range of refractories and related products to customers in the iron, steel, glass and other industries. The Company filed for chapter 11 protection on Sept. 3, 2004 (Bankr. S.D.N.Y. Case No. 04-15739) to resolve legacy asbestos-related liability. Michael L. Cook, Esq., Lawrence V. Gelber, Esq., and Jessica L. Fainman, Esq., at Schulte Roth & Zabel LLP, represent the Company in its restructuring efforts. Albert Togut, Esq., at Togut Segal & Segal serves as the Futures Representative. Elihu Inselbuchm Esq., at Caplin & Drysdale, Chartered, represents the Official Committee of Unsecured Creditors. When the Debtor filed for protection from its creditors, it listed $155,187,000 in total assets and $141,933,000 in total debts. REFCO INC: Davidson Kempner Offering to Buy Refco Capital Claims ---------------------------------------------------------------- Davidson Kempner Capital Management LLC is offering to buy: * scheduled and undisputed Securities Customer Claims (as that term is defined in the RCM Settlement Agreement) against Refco Capital Markets, LTD, at a rate of 65 cents-on-the- dollar; and * scheduled and undisputed FX/Unsecured Claims (as that term is defined in the RCM Settlement Agreement) against Refco Capital Markets, LTD, at a rate of 25 cents-on-the-dollar. This offer is valid through August 21, 2006, contingent on due diligence, the price is subject to change based on events in the bankruptcy and day-to-day news in the industry, and other strings are attached. For additional information, contact: Aileen M. Watson Davidson Kempner Capital Management LLC 65 East 55th Street, 19th Floor New York, New York 10022 Telephone (212) 446-4065 Facsimile (646) 924-0465 About Refco Inc. Based in New York, Refco Inc. -- http://www.refco.com/-- is a diversified financial services organization with operations in 14 countries and an extensive global institutional and retail client base. Refco's worldwide subsidiaries are members of principal U.S. and international exchanges, and are among the most active members of futures exchanges in Chicago, New York, London and Singapore. In addition to its futures brokerage activities, Refco is a major broker of cash market products, including foreign exchange, foreign exchange options, government securities, domestic and international equities, emerging market debt, and OTC financial and commodity products. Refco is one of the largest global clearing firms for derivatives. The Company and 23 of its affiliates filed for chapter 11 protection on Oct. 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006). J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Luc A. Despins, Esq., at Milbank, Tweed, Hadley & McCloy LLP, represents the Official Committee of Unsecured Creditors. Refco reported $16.5 billion in assets and $16.8 billion in debts to the Bankruptcy Court on the first day of its chapter 11 cases. Refco LLC, an affiliate, filed for chapter 7 protection on Nov. 25, 2005 (Bankr. S.D.N.Y. Case No. 05-60134). Refco, LLC, is a regulated commodity futures company that has businesses in the United States, London, Asia and Canada. Refco, LLC, filed for bankruptcy protection in order to consummate the sale of substantially all of its assets to Man Financial Inc., a wholly owned subsidiary of Man Group plc. Albert Togut, the chapter 7 trustee, is represented by Togut, Segal & Segal LLP. On April 13, 2006, the Court appointed Marc S. Kirschner as Refco Capital Markets Ltd.'s chapter 11 trustee. Mr. Kirschner is represented by Bingham McCutchen LLP. RCM is Refco's operating subsidiary based in Bermuda. Three more affiliates of Refco, Westminster-Refco Management LLC, Refco Managed Futures LLC, and Lind-Waldock Securities LLC, filed for chapter 11 protection on June 6, 2006 (Bankr. S.D.N.Y. Case Nos. 06-11260 through 06-11262). RENT-A-CENTER INC: To Acquire Rent-Way for $567 Million ------------------------------------------------------- Rent-A-Center, Inc., entered into a definitive agreement pursuant to which it will acquire Rent-Way, Inc.'s common stock for $10.65 per share, in cash. The agreement also provides that each holder of options of Rent- Way will receive an amount equal to the difference between $10.65 and the exercise price of the option. The transaction is valued at approximately $567 million, which includes the acquisition of all outstanding common stock and options, net debt and other liabilities of Rent-Way, as well as the redemption of all outstanding convertible preferred stock. "We are very excited about this transaction with Rent-Way," commented Mark E. Speese, the Company's Chairman of the Board and Chief Executive Officer. "Bill Morgenstern and his management team have built a successful rent-to-own operation as demonstrated by the fact that Rent-Way has accomplished eleven positive same store sales quarters out of the last twelve. "Given our track record of successfully integrating acquisitions and implementing our proven business model, we believe that this transaction will create additional value for our stockholders. Giving effect to Rent-Way's forecasted 2006 EBITDA of approximately $60 million and the full realization of cost savings through leveraging our existing infrastructure and scale, pro-forma EBITDA of $85 million should be achieved, with further growth continuing from the execution of our business model. In fact, we believe we will be able to build on Rent-Way's success as evidenced by our 2003 acquisition of 295 Rent-Way stores. With our national brand and advertising driving customer traffic and our broad selection of high quality, brand-name merchandise, we believe we can grow both revenue and store operating income to nearly comparable results to our core stores," continued Mr. Speese. "Furthermore, we expect to realize these cost savings in advertising, merchandise purchases and general and administrative expenses. As a result, following an initial six- month transition period and the realization of cost savings in the last half of the year, we believe the transaction will be accretive to our 2007 diluted earnings per share by approximately one to two cents, accelerating in 2008 and 2009 to approximately $0.20 and $0.35 diluted earnings per share, respectively. I want to point out that our diluted earnings per share accretion of approximately one to two cents in 2007 and approximately $0.20 in 2008 is after the negative impact of approximately $0.11 and $0.06 diluted earnings per share, respectively, due to the amortization of intangible assets related to the customer and non-compete agreements. These are assets we must record and amortize in connection with the acquisition, but they roll off quickly resulting in higher levels of accretion in the future," Mr. Speese said. "I have known Mark Speese for many years and believe he and his strong management team have a vision for Rent-A-Center that our team can embrace," Mr. William Morgenstern, Chairman of the Board of Rent-Way stated. "We believe that our customers will be well served by this transaction and that it will provide additional growth opportunities for our nearly 4,000 talented associates. "As a co-founder of Rent-Way 25 years ago, I have great pride in our collective accomplishments over the years achieved by the dedication and commitment of the fine Rent-Way team which have now culminated with the sale of our business to a first-class industry leader," Mr. Morgenstern added. Rent-A-Center intends to fund the acquisition primarily with an increase in its senior credit facility. The acquisition, which is expected to be completed in the fourth quarter of 2006, is conditioned upon customary closing conditions for a transaction of this nature, including the receipt of requisite regulatory approval and approval of Rent-Way's shareholders. In connection with this transaction, Rent-A-Center was advised by Bear, Stearns & Co. Inc. and Rent-Way was advised by Citigroup Global Markets Inc. About Rent-Way Headquartered in Erie, Pennsylvania, Rent-Way Inc. (NYSE: RWY) -- http://www.rentway.com/-- offers quality, brand name home entertainment equipment, furniture, computers, major appliances and jewelry at 784 rental-purchase stores in 34 states. Established in 1981, the Company employs 4,000 associates. About Rent-A-Center Based in Plano, Texas, Rent-A-Center, Inc. (Nasdaq:RCII) -- http://www.rentacenter.com/-- operates the largest chain of consumer rent-to-own stores in the U.S. with 2,751 company operated stores located in the U.S., Canada, and Puerto Rico. The company also franchises 297 rent-to-own stores that operate under the "ColorTyme" and "Rent-A-Center" banners. * * * As reported in the Troubled Company Reporter on Aug. 10, 2006, Standard & Poor's Ratings Services placed its debt ratings, including its 'BB+' corporate credit rating, on Plano, Texas-based Rent-A-Center Inc. on CreditWatch with negative implications. At the same time, Standard & Poor's placed its ratings, including the 'B+' corporate credit rating, on Erie, Pennsylvania-based Rent-Way Inc. on CreditWatch with positive implications. As reported in the Troubled Company Reporter on June 23, 2006, Moody's Investors Service assigned a Ba2 rating to the bank loan of Rent-A-Center, Inc., and affirmed the Ba2 corporate family as well as the senior subordinated note issue at Ba3. The continuation of the positive outlook reflected Moody's opinion that ratings could be upgraded over the medium-term once the company establishes a lengthier track record of sales improvement and Moody's becomes more comfortable with the company's financial policy. RENT-WAY INC: Sells Assets to Rent-A-Center for $567 Million ------------------------------------------------------------ Rent-A-Center, Inc., entered into a definitive agreement pursuant to which it will acquire Rent-Way, Inc.'s common stock for $10.65 per share, in cash. The agreement also provides that each holder of options of Rent- Way will receive an amount equal to the difference between $10.65 and the exercise price of the option. The transaction is valued at approximately $567 million, which includes the acquisition of all outstanding common stock and options, net debt and other liabilities of Rent-Way, as well as the redemption of all outstanding convertible preferred stock. "We are very excited about this transaction with Rent-Way," commented Mark E. Speese, the Company's Chairman of the Board and Chief Executive Officer. "Bill Morgenstern and his management team have built a successful rent-to-own operation as demonstrated by the fact that Rent-Way has accomplished eleven positive same store sales quarters out of the last twelve. "Given our track record of successfully integrating acquisitions and implementing our proven business model, we believe that this transaction will create additional value for our stockholders. Giving effect to Rent-Way's forecasted 2006 EBITDA of approximately $60 million and the full realization of cost savings through leveraging our existing infrastructure and scale, pro-forma EBITDA of $85 million should be achieved, with further growth continuing from the execution of our business model. In fact, we believe we will be able to build on Rent-Way's success as evidenced by our 2003 acquisition of 295 Rent-Way stores. With our national brand and advertising driving customer traffic and our broad selection of high quality, brand-name merchandise, we believe we can grow both revenue and store operating income to nearly comparable results to our core stores," continued Mr. Speese. "Furthermore, we expect to realize these cost savings in advertising, merchandise purchases and general and administrative expenses. As a result, following an initial six- month transition period and the realization of cost savings in the last half of the year, we believe the transaction will be accretive to our 2007 diluted earnings per share by approximately one to two cents, accelerating in 2008 and 2009 to approximately $0.20 and $0.35 diluted earnings per share, respectively. I want to point out that our diluted earnings per share accretion of approximately one to two cents in 2007 and approximately $0.20 in 2008 is after the negative impact of approximately $0.11 and $0.06 diluted earnings per share, respectively, due to the amortization of intangible assets related to the customer and non-compete agreements. These are assets we must record and amortize in connection with the acquisition, but they roll off quickly resulting in higher levels of accretion in the future," Mr. Speese said. "I have known Mark Speese for many years and believe he and his strong management team have a vision for Rent-A-Center that our team can embrace," Mr. William Morgenstern, Chairman of the Board of Rent-Way stated. "We believe that our customers will be well served by this transaction and that it will provide additional growth opportunities for our nearly 4,000 talented associates. "As a co-founder of Rent-Way 25 years ago, I have great pride in our collective accomplishments over the years achieved by the dedication and commitment of the fine Rent-Way team which have now culminated with the sale of our business to a first-class industry leader," Mr. Morgenstern added. Rent-A-Center intends to fund the acquisition primarily with an increase in its senior credit facility. The acquisition, which is expected to be completed in the fourth quarter of 2006, is conditioned upon customary closing conditions for a transaction of this nature, including the receipt of requisite regulatory approval and approval of Rent-Way's shareholders. In connection with this transaction, Rent-A-Center was advised by Bear, Stearns & Co. Inc. and Rent-Way was advised by Citigroup Global Markets Inc. About Rent-A-Center Based in Plano, Texas, Rent-A-Center, Inc. (Nasdaq:RCII) -- http://www.rentacenter.com/-- operates the largest chain of consumer rent-to-own stores in the U.S. with 2,751 company operated stores located in the U.S., Canada, and Puerto Rico. The company also franchises 297 rent-to-own stores that operate under the "ColorTyme" and "Rent-A-Center" banners. About Rent-Way Headquartered in Erie, Pennsylvania, Rent-Way Inc. (NYSE: RWY) -- http://www.rentway.com/-- offers quality, brand name home entertainment equipment, furniture, computers, major appliances and jewelry at 784 rental-purchase stores in 34 states. Established in 1981, the Company employs 4,000 associates. * * * As reported in the Troubled Company Reporter on Aug. 10, 2006, Moody's Investors Service placed all ratings of Rent-Way, Inc., under review for possible upgrade. The review is prompted by the announcement that Rent-A-Center, Inc. intends to acquire complete ownership of Rent-Way. Moody's notes that the rated senior secured notes are redeemable at any time at the option of the company. The ratings are placed under review for possible upgrade include: $205 million 11.875% second-lien secured note issue of B3, and corporate family rating of B3. RICHARD INFARINATO: Case Summary & 16 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: Richard Infarinato 50 Calumet Street Rochester, New York 14610 Bankruptcy Case No.: 06-21441 Chapter 11 Petition Date: August 9, 2006 Court: Western District of New York (Rochester) Debtor's Counsel: Michael H. Arnold, Esq. Place & Arnold 27 Pleasant Street Fairport, New York 14450 Tel: (585) 425-1060 Total Assets: $3,913,802 Total Debts: $1,128,084 Debtor's 16 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Bank of America Consumer purchase $37,661 P.O. Box 1758 Newark, NJ 07101 American Express Consumer purchase $24,432 P.O. Box 360002 Ft. Lauderdale, FL 33336-0002 Bank of America Consumer purchase $17,079 P.O. Box 1758 Newark, NJ 07101-1758 Chase Bank One Visa Consumer purchase $15,926 American Express Consumer purchase $15,801 Key Bank Consumer purchase $14,873 Chase Bank One Visa Consumer purchase $13,371 Chase Bank One Visa Consumer purchase $13,320 Chase Bank One Visa Line of credit $10,485 National CityBank Consumer purchase $9,806 Bank of America Line of credit $9,318 Capital One Consumer purchase $8,896 HSBC Bank Consumer purchase $8,461 HSBC Bank Line of credit $8,183 AT&T Universal Line of credit $3,650 Key Bank Overdarft line of $450 Credit RIGEL CORPORATION: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Rigel Corporation 1530 West 10th Place Tempe, Arizona 85281 Bankruptcy Case No.: 06-02480 Type of Business: The Debtor is a Krispy Kreme franchisee. The Debtor also operates Godfather's Pizza, KFC and Bruegger's Bagels' franchises. Vincent J. Morrissey, the Debtor's president and CEO, filed for chapter 11 protection on July 26, 2006 (Bankr. D. Ariz. Case No. 06-02282). Chapter 11 Petition Date: August 9, 2006 Court: District of Arizona (Phoenix) Judge: Redfield T. Baum Sr. Debtor's Counsel: Michael W. Carmel, Esq. Michael W. Carmel, Ltd. 80 East Columbus Avenue Phoenix, Arizona 85012-4965 Tel: (602) 264-4965 Fax: (602) 277-0144 Estimated Assets: $10 Million to $50 Million Estimated Debts: $10 Million to $50 Million Debtor's 17 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Mid City Bank Bank Loan $3,472,818 304 42nd Street Omaha, NE 68131 Krispy Kreme Trade $2,144,602 Doughnut Corp P.O. Box 752046 Charlotte, NC Krispy Kreme - Roy Franchise $1,382,231 P.O. Box 752046 Charlotte, NC Don O'Toole Real Estate Debt $463,280 2102 South Yellow Wood Mesa, AZ 85212 Arizona Dept. of Revenue Trade $338,257 P.O. Box 29010 Phoenix, AZ 85038-9010 Penske Trade $215,726 The Hartford Insurance $110,704 Envirosure Solutions, LLC Trade $70,267 Levine Investment, LP Leases $61,667 Maricopa County Treasurer Taxes $54,289 Western Paper Trade $52,191 Debelis Corporation Trade $43,200 Bernalillo County Taxes $34,914 Treasurer Silverstone Group Insurance $33,394 Prudential Overall Supply Trade $27,601 Coyotes Hockey Marketing $25,200 SRP Utilities $24,706 Viacom Sports Marketing $22,700 MCI Utilities $21,219 Logo Apparel Trade $20,812 RIVIERA HOLDINGS: IGE Proposal Cues S&P to Hold Developing Watch ---------------------------------------------------------------- Standard & Poor's Ratings Services said that its ratings on Riviera Holdings Corp., including its 'B' corporate credit rating, remain on CreditWatch with developing implications where they were placed on March 23, 2006, after the company's announcement that it had resumed previously initiated discussions with a certain investor group regarding its possible acquisition of Riviera. The Las Vegas-based casino owner and operator subsequently entered into a definitive agreement with this investor group whereby all outstanding shares other than the shares held by Riviera's Chief Executive Officer, William Westerman, would be acquired at a price of $17 per share in cash or $427 million, including the assumption of roughly $215 million in outstanding debt. Mr. Westerman had agreed to vote in favor of the acquisition and sell his shares to the investor group at $15 per share in cash. On Aug. 8, 2006 -- the day shareholders met to vote on the merger agreement -- Riviera announced that it received an unsolicited, competing takeover proposal from International Gaming & Entertainment LLC to acquire the company for $20 per share or $464 million, including the assumption of debt. While IGE has committed to a certain equity capital, the company does not yet have a financing commitment. The proposal, however, is not be subject to a financing contingency. The shareholder vote has been postponed until Aug. 29, 2006, while management determines if the new offer is credible. ROYAL GROUP: Shareholders OKs $1.7 Billion Georgia Gulf Buy Offer ----------------------------------------------------------------- Shareholders of Royal Group Technologies Limited overwhelmingly approved the plan of arrangement with Georgia Gulf Corporation, whereby Georgia Gulf offered CDN$13 per share in cash for all of the outstanding shares of Royal Group. Over 99% of the votes cast were voted in favor of the plan of arrangement. Closing of the transaction remains targeted for September 2006. As reported in the Troubled Company Reporter on July 6, 2006, the Board of Directors of Royal Group recommended that shareholders approve a CDN$13 all cash transaction to be implemented by way of a plan of arrangement. The Company entered into an agreement with Georgia Gulf pursuant to which it will acquire all of the common shares of Royal Group at a price of CDN$13 per share, subject to, among other conditions, approval by shareholders of Royal Group at a special meeting of shareholders. The total value of the transaction, including debt, is CDN$1.7 billion (approximately $1.5 billion). About Georgia Gulf Headquartered in Atlanta, Georgia, Georgia Gulf Corporation (NYSE: GGC) -- http://www.ggc.com/-- manufactures and markets two integrated product lines, chlorovinyls and aromatics. Georgia Gulf's chlorovinyls products include chlorine, caustic soda, vinyl chloride monomer and vinyl resins and compounds. Georgia Gulf's primary aromatic products include cumene, phenol and acetone. About Royal Group Headquartered in Ontario, Canada, Royal Group Technologies Limited (TSX & NYSE: RYG) -- http://www.royalgrouptech.com-- produces innovative, attractive, durable, and low-maintenance home improvement and building products, which are primarily utilized in both the renovation and new construction sectors of the North American construction industry. The Company has manufacturing operations located throughout North America in order to provide industry-leading service to its extensive customer network. * * * As reported in the Troubled Company Reporter on June 14, 2006, Standard & Poor's Ratings Services said its 'BB' long-term corporate credit and senior unsecured debt ratings on Woodbridge, Ontario-based Royal Group Technologies Ltd. will remain on CreditWatch with negative implications, where they were placed March 16, 2006. The continued CreditWatch follows Georgia Gulf Corp.'s (BB+/Watch Neg/--) takeover proposal for CDN$1.7 billion, including CDN$491 million of assumed net debt. SATELITES MEXICANOS: Files for Chapter 11 Protection in New York ---------------------------------------------------------------- Satelites Mexicanos, S.A. de C.V., filed for Chapter 11 Reorganization with the U.S. Bankruptcy Court for the Southern District of New York on Aug. 11, 2006. Contemporaneous with the filing of its chapter 11 petition, the Debtor filed a motion to dismiss the Section 304 Case it commenced on Aug. 4, 2005. The preliminary injunction issued by the Court pursuant to the Section 304 petition terminates today. Satmex's Chapter 11 filing is part of a Restructuring Agreement with major creditors and equity constituencies that provides for a global restructuring of its Senior Secured Notes, Existing Bonds and Interests, through the filing and approval of a Plan under Mexico's "concurso mercantil" reorganization proceeding and the confirmation of a Chapter 11 plan in the U.S. Bankruptcy Court. The Debtor and: * Servicios Corporativos Satelitales, S.A. de C.V.; * Loral Skynet Corporation; * Principia, S.A. de C.V.; * certain holders of the Debtor's Senior Secured Notes; and * certain holders of the Debtor's Existing Bonds executed the terms of this consensual Restructuring Agreement on March 31, 2006. As of its bankruptcy filing, the Debtor's principal indebtedness includes: -- approximately $320,000,000 in principal amount of 10-1/8% Unsecured Senior Notes due Nov. 1, 2004, pursuant to a February 1998 indenture with The Bank of New York, as Indenture Trustee; and -- approximately $203,400,000 in principal amount of Senior Secured Notes due June 30, 2004, pursuant to the March 1998 indenture with Citibank, N.A., as Indenture Trustee. The Senior Secured Notes are secured by first priority liens against, and a security interest in substantially all of Satmex's assets. Satmex's Woes The telecommunications sector's sharp downturn in the early 2001, resulted in the cancellation of existing contracts and a decrease in revenues earned by the Debtor. The Debtor ceased making interest payments on its Existing Bonds beginning Aug. 1, 2003, and failed to pay the principal amount of the Existing Bonds that came due upon maturity on Nov. 1, 2004. The Senior Secured Notes matured on June 30, 2004, and the Debtor also did not make the required principal payment. The default of Servicios -- Satmex's immediate parent company -- on the $125.1 million promissory note referred to as the "menoscabo" on September 2003 also constituted a default under the indentures governing the Senior Secured Notes and Existing Bonds. The Debtor realized that a financial restructuring was imperative due to liquidity constraints and defaults under the Existing Bond Indenture and the Existing Note Indenture. During the latter part of 2003, it commenced negotiations with advisors for certain holders of Existing Bonds and advisors for certain holders of Senior Secured Notes in an effort to restructure its existing indebtedness and obtain financing to complete the launch of Satmex 6. In December 2004, the Debtor's negotiations with the Ad Hoc Committees resulted in a proposed term sheet outlining the terms of a plan of reorganization to restructure Satmex's debt obligations. The Debtor, however, was unable to garner the necessary support for the proposed term sheet from the Mexican Government in its capacity as, among other things, regulator and shareholder of Satmex. Due the breakdown in the negotiation process, certain holders of the Existing Bonds and the Senior Secured Notes filed an involuntary chapter 11 petition against the Debtor on May 25, 2005. The Debtor says that as a continuation of the effort to restructure its outstanding indebtedness, it filed a voluntary petition for a Mexican reorganization, known as a concurso mercantile, on June 29, 2005. The case was assigned to the Second Federal District Court for Civil Matters for the Federal District in Mexico City. The Mexican Court, on June 30, 2005, admitted the Debtor's petition to commence the Concurso Proceeding and ordered the Instituto Federal de Especialistas de Concursos Mercantiles to appoint an independent auditor called the "Visitador" to determine if Satmex satisfied the requirements to be a debtor under the Ley de Concursos Mercantiles of Mexico. The Mexican Bankruptcy Court also entered an order: (i) staying any foreclosure proceeding against the rights and assets of the Debtor, (ii) prohibiting the Debtor from disposing or encumbering its main properties or assets, and (iii) prohibiting the Debtor from transferring its valuables or funds to third parties. During this period, the Debtor continued negotiations with its creditors in an attempt to: (i) resolve the involuntary chapter 11 on a consensual basis in the near term; and (ii) come to agreement on global restructuring issues, particularly with respect to the Senior Secured Notes and the Existing Bonds. In July 2005, the Debtor reached an agreement with the Petitioning Creditors, which provided that, among other things, that the Petitioning Creditors would consent to the: (a) dismissal of the involuntary chapter 11 case, (b) commencement of a case under Section 304 of the Bankruptcy Code ancillary to the Concurso Proceeding, and (c) entry of a preliminary injunction in connection with the 304 Case against, among other things, any actions against the Debtor or its assets. On Sept. 7, 2005, the Mexican Bankruptcy Court declared Satmex in "concurso mercantil" under the LCM and on Oct. 11, 2005, the Mexican Bankruptcy Court appointed Thomas Stanley Heather Rodriguez as conciliador in the Concurso Proceeding. The Debtor subsequently filed its or Concurso Plan with the Mexican Bankruptcy Court which details the terms and framework of the restructuring agreed upon by the Debtor and its creditors and equity holders. That Plan also provides for final implementation of the Debtor's restructuring through a plan confirmed in a case commenced under chapter 11 of the Bankruptcy Code. The Mexican Bankruptcy Court approved the Concurso Plan on July 17, 2006. About Satmex Satelites Mexicanos, S.A. de C.V., provides fixed satellite services in Mexico. Satmex provides transponder capacity via its satellites to customers for distribution of network and cable television programming, direct-to-home television service, on-site transmission of live news reports, sporting events and other video feeds. Satmex also provides satellite transmission capacity to telecommunications service providers for public telephone networks in Mexico and elsewhere and to corporate customers for their private business networks with data, voice and video applications. Satmex also provides the government of the United Mexican States with approximately 7% of its satellite capacity for national security and public purposes without charge, under the terms of the Orbital Concessions. The Debtor filed for chapter 11 petition on August 11, 2006 (Bankr. S.D.N.Y. Case No. 06-11868). Luc A. Despins, Esq., at Milbank, Tweed Hadley & McCloy LLP represents the Debtor in the U.S. Bankruptcy proceedings. Attorneys from Galicia y Robles, S.C., and Quijano Cortina Lopez y de la Torre give legal advice in the Debtor's Mexican Bankrutpcy proceedings. UBS Securities LLC and Valor Consultores, S.A. de C.V., give financial advice to the Debtor. Steven Scheinman, Esq., Michael S. Stamer, Esq., and Shuba Satyaprasad, Esq., at Akin Gump Strauss Hauer & Feld LLP give legal advice to the Ad Hoc Existing Bondholders' Committee. Dennis Jenkins, Esq., and George W. Shuster, Jr., Esq., at Wilmer Cutler Pickering Hale and Dorr LLP give legal advice to Ad Hoc Senior Secured Noteholders' Committee. As of July 24, 2006, the Debtor has $905,953,928 in total assets and $743,473,721 in total liabilities. On May 25, 2005, certain holders of Satmex's Existing Bonds and Senior Secured Notes filed an involuntary chapter 11 petition against the Company (Bankr. S.D.N.Y. Case No. 05-13862). On June 29, 2005, Satmex filed a voluntary petition for a Mexican reorganization, known as a Concurso Mercantil, which was assigned to the Second Federal District Court for Civil Matters for the Federal District in Mexico City. On August 4, 2005, Satmex filed a petition, pursuant to Section 304 of the Bankruptcy Code to commence a case ancillary to the Concurso Proceeding and a motion for injunctive relief seeking, among other things, to enjoin actions against Satmex or its assets (Bankr. S.D.N.Y. Case No. 05-16103). Satmex's affiliates, Loral Space & Communications Ltd., and affiliates, filed for chapter 11 protection on July 15, 2003 (Bankr. S.D.N.Y. Case Nos. 03-41710). The Court confirmed Loral's plan on August 1, 2005. SATELITES MEXICANOS: Case Summary & 9 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: Satelites Mexicanos, S.A. de C.V. Rodolfo Gaona #86 Col. Lomas de Sotelo Mexico D.F. 11200 Mexico Bankruptcy Case No.: 06-11868 Type of Business: Satmex is the leading provider of fixed satellite services in Mexico. Satmex provides transponder capacity via its satellites to customers for distribution of network and cable television programming, direct-to-home television service, on-site transmission of live news reports, sporting events and other video feeds. Satmex also provides satellite transmission capacity to telecommunications service providers for public telephone networks in Mexico and elsewhere and to corporate customers for their private business networks with data, voice and video applications. Satmex markets the use of satellite transmission capacity for new applications, such as Internet via satellite. Satmex also provides the government of the United Mexican States with approximately 7% of its satellite capacity for national security and public purposes without charge, under the terms of the Orbital Concessions. Satmex is the largest provider of satellite services to the Mexican Government and these services are crucial to the Mexican Government's national security and defense operations. On May 25, 2005, certain holders of Satmex's Existing Bonds and Senior Secured Notes filed an involuntary chapter 11 petition against the Company (Bankr. S.D.N.Y. Case No. 05-13862). On June 29, 2005, Satmex filed a voluntary petition for a Mexican reorganization, known as a concurso mercantile, which was assigned to the Second Federal District Court for Civil Matters for the Federal District in Mexico City. On June 30, 2005, the Mexican Bankruptcy Court admitted Satmex's petition to commence the Concurso Proceeding and ordered the Instituto Federal de Especialistas de Concursos Mercantiles to appoint an independent auditor called the "Visitador" to determine if Satmex satisfied the requirements to be a debtor under the Ley de Concursos Mercantiles of Mexico. On August 4, 2005, Satmex filed a petition, pursuant to section 304 of the Bankruptcy Code to commence a case ancillary to the Concurso Proceeding and a motion for injunctive relief seeking, among other things, to enjoin actions against Satmex or its assets (Bankr. S.D.N.Y. Case No. 05-16103). Satmex's affiliates, Loral Space & Communications Ltd., and affiliates, filed for chapter 11 protection on July 15, 2003 (Bankr. S.D.N.Y. Case Nos. 03-41710). Chapter 11 Petition Date: August 11, 2006 Court: Southern District of New York (Manhattan) Judge: Robert D. Drain Debtor's Counsel: Luc A. Despins, Esq. Milbank, Tweed Hadley & McCloy LLP One Chase Manhattan Plaza New York, NY 10005 Tel: (212) 530-5000 Fax: (212) 530-5219 Debtor's Mexican Counsel: Galicia y Robles, S.C. -- and -- Quijano Cortina Lopez y de la Torre Debtor's Financial Advisor: UBS Securities LLC -- and -- Valor Consultores, S.A. de C.V. Debtor's Auditor: Deloitte & Touche Debtor's Claims, Noticing, and Balloting Agent: Kurtzman Carson Consultants LLC Ad Hoc Existing Bondholders' Committee's Counsel: Steven Scheinman, Esq. Michael S. Stamer, Esq. Shuba Satyaprasad, Esq. Akin Gump Strauss Hauer & Feld LLP 590 Madison Avenue New York, NY 10022 Ad Hoc Senior Secured Noteholders' Committee Counsel: Dennis Jenkins, Esq. George W. Shuster, Jr., Esq. Wilmer Cutler Pickering Hale and Dorr LLP 60 State Street Boston, MA 02109 Financial Condition as of July 24, 2006: Total Assets: $905,953,928 Total Debts: $743,473,721 Debtor's 9 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ The Bank of New York 10-1/8% Unsecured $413,774,527 (as indenture trustee for Senior Notes the Existing Bonds) 101 Barclay Street Floor 21 West, New York, NY 10286 Attn: Ming J. Shiang Assistant Vice President Tel: (212) 815-7181 Castalia Communications Trade $549,306 Corporation 1532 Dunwoody Village Parkway Suite 205 Atlanta, GA 30338 Attn: Luis Torres-Bohl President Tel: (770) 396-7850 Fax: (770) 396-3464 Xeipn Canal 11/Canal 11 Trade $250,602 Prolongacion de Carpio 475 Mexico D.F. 11340 Attn: Julio Di-Bella Roldan Director Tel: +52 (55) 5356-1111 Fax: +52 (55) 5341-2043 Corporacion Ecuatoriana de Trade $191,659 Television, S.A./ECUAVISA Cerro Del Carmen S/N Casilla Postal 10992 Guayaquil, Ecuador 10992 Attn: Xavier Alvarado Robles President Tel: + 593 (4) 256 2444 Fax: + 593 (4) 256 6219 ACS Global TV C.V. Trade $146,610 Latinoamerica TV Calle Enriqueta Compte Y Rique 1276 Montevideo, Uruguay 11800 Attn: Atanasio Aguirre Lussich Tel: +598 (2) 208-3363 int 323/214 Fax: +598 (2) 208-3363 int 200 Nexus International Trade $114,030 Broadcasting, Inc. Colorvision 2140 South Dixie Highway, Suite 207 Miami, FL 33133 Attn: Cesar Mazzotta Managing Director Tel: (305) 398-8812 Fax: (305) 358-8525 Television Trade $75,179 Metropolitanacanal 22 Atletas 2, Edif. Pedro Infante Mexico D.F. 04220 Attn: Hector Abadie Vazquez Tel: +52 (55) 5549-6298 +52 (55) 5549-6888 Fax: +52 (55) 5544-4843 Massachusetts Institute of Service provider $39,916 Technology/M.I.T. Provision 244 Wood Street, Room S3-219 Lexington, MA 02420 Attn: David L Briggs Director Cooperative Research -- and -- Gail A Powderly, C.P. Technology & Contracts Office, Lincoln Laboratory Tel: (781) 981-7087 Fax: (781) 981-1494 Medio Entertainment, S.A. Trade $26,042 de C.V. CBTV Michoacan Agustin Melgar 325-101 Morelia/Michoacan 58260 Mexico Attn: Isllali Belmonte Rosales Tel: +52 (443) 314-3515 Fax: +52 (443) 315-6883 SATELITES MEXICANOS: Files Plan and Disclosure Statement in NY -------------------------------------------------------------- Satelites Mexicanos, S.A. de C.V., submitted its Chapter 11 Plan of Reorganization and accompanying Disclosure Statement to the U.S. Bankruptcy Court for the Southern District of New York on Aug. 11, 2006. The Chapter 11 Plan provides, among other things, for an equitable distribution of the value of, and ownership interests in, Satmex's business to parties in interest. The Chapter 11 Plan permits Satmex to emerge from chapter 11 substantially deleveraged, enabling the Company to operate as an economically viable competitor and leader in the fixed satellite services industry. Implementation of the Chapter 11 Plan is anticipated to result in a reduction of Satmex's outstanding indebtedness primarily through the restructuring of secured and unsecured debt as well as the conversion of a portion of the Debtor's unsecured debt securities to equity in the reorganized company. Under the Chapter 11 Plan, allowed administrative expense claims, federal, state and local tax claims, other priority claims, other general unsecured claims and secured claims are unimpaired. As of its bankruptcy filing, the Debtor's principal indebtedness includes: -- approximately $320,000,000 in principal amount of 10-1/8% Unsecured Senior Notes due Nov. 1, 2004, pursuant to a February 1998 indenture with The Bank of New York, as Indenture Trustee; and -- approximately $203,400,000 in principal amount of Senior Secured Notes due June 30, 2004, pursuant to the March 1998 indenture with Citibank, N.A., as Indenture Trustee. The claims of holders of the Senior Secured Notes will be converted into $234,400,000 of senior secured notes, to be issued by Satmex on the Effective Date. The claims of holders of the Existing Bonds will be converted into: (i) $140,000,000 of second priority senior secured notes, to be issued by Satmex on the Effective Date; and (ii) interests in a trust formed to hold the new common stock to be issued by Satmex on the Effective Date under the Chapter 11 Plan to the holders of the Existing Bonds consisting of shares of the series B common stock of reorganized Satmex and shares of series N common stock of reorganized Satmex that represent 78% of the total equity economic interests and 43% of the total equity voting rights of reorganized Satmex on a fully diluted basis. Principia, S.A. de C.V. and Loral Skynet Corporation, as holders of Satmex's Existing Preferred Stock, will receive, on the Effective Date, shares of New Series B Common Stock and the New Series N Common Stock to be distributed so that: (i) Principia will receive interests in the Equity Trust representing 0.67% of the total equity economic interests and 0.67% of the total equity voting rights of reorganized Satmex on a fully diluted basis; and (ii) Loral will receive interests in the Equity Trust representing 1.33% of the total equity economic interests and 1.33% of the total equity voting rights of reorganized Satmex on a fully diluted basis. In addition, Loral and its affiliates will receive certain other concessions from Satmex in return for their participation in Satmex's restructuring, including, without limitation: (i) the grant to certain affiliates of Loral of a "usufructo" under Mexican law in certain transponders on Satmex 5 and Satmex 6; (ii) a right of first offer with respect to the construction of Satmex's next satellite, and (iii) the assumption pursuant to Section 365 of the Bankruptcy Code by Satmex of that certain global settlement agreement And related agreements between Satmex and certain affiliates of Loral. The Government of United Mexican States and Servicios Corporativos Satelitales, S.A. de C.V., as holders of Satmex's Existing Common Stock, will receive, on the Effective Date, shares of the series A common stock of reorganized Satmex and of the New Series N Common Stock, to be apportioned as: - the Mexican Government will receive interests in the Equity Trust representing 4% of the total equity economic interests and 10% of the total equity voting rights of reorganized Satmex on a fully diluted basis; and - Servicios will receive interests in the Equity Trust representing 16% of the total equity economic interests and 45% of the total equity voting rights of reorganized Satmex on a fully diluted basis. A copy of Satmex's Chapter 11 Plan of Reorganization is available for a fee at: http://www.researcharchives.com/bin/download?id=060813215708 A copy of the Disclosure Statement explaining the Chapter 11 plan is available for a fee at: http://www.researcharchives.com/bin/download?id=060813215920 About Satmex Satelites Mexicanos, S.A. de C.V., provides fixed satellite services in Mexico. Satmex provides transponder capacity via its satellites to customers for distribution of network and cable television programming, direct-to-home television service, on-site transmission of live news reports, sporting events and other video feeds. Satmex also provides satellite transmission capacity to telecommunications service providers for public telephone networks in Mexico and elsewhere and to corporate customers for their private business networks with data, voice and video applications. Satmex also provides the government of the United Mexican States with approximately 7% of its satellite capacity for national security and public purposes without charge, under the terms of the Orbital Concessions. The Debtor filed for chapter 11 petition on August 11, 2006 (Bankr. S.D.N.Y. Case No. 06-11868). Luc A. Despins, Esq., at Milbank, Tweed Hadley & McCloy LLP represents the Debtor in the U.S. Bankruptcy proceedings. Attorneys from Galicia y Robles, S.C., and Quijano Cortina Lopez y de la Torre give legal advice in the Debtor's Mexican Bankrutpcy proceedings. UBS Securities LLC and Valor Consultores, S.A. de C.V., give financial advice to the Debtor. Steven Scheinman, Esq., Michael S. Stamer, Esq., and Shuba Satyaprasad, Esq., at Akin Gump Strauss Hauer & Feld LLP give legal advice to the Ad Hoc Existing Bondholders' Committee. Dennis Jenkins, Esq., and George W. Shuster, Jr., Esq., at Wilmer Cutler Pickering Hale and Dorr LLP give legal advice to Ad Hoc Senior Secured Noteholders' Committee. As of July 24, 2006, the Debtor has $905,953,928 in total assets and $743,473,721 in total liabilities. On May 25, 2005, certain holders of Satmex's Existing Bonds and Senior Secured Notes filed an involuntary chapter 11 petition against the Company (Bankr. S.D.N.Y. Case No. 05-13862). On June 29, 2005, Satmex filed a voluntary petition for a Mexican reorganization, known as a Concurso Mercantil, which was assigned to the Second Federal District Court for Civil Matters for the Federal District in Mexico City. On August 4, 2005, Satmex filed a petition, pursuant to Section 304 of the Bankruptcy Code to commence a case ancillary to the Concurso Proceeding and a motion for injunctive relief seeking, among other things, to enjoin actions against Satmex or its assets (Bankr. S.D.N.Y. Case No. 05-16103). Satmex's affiliates, Loral Space & Communications Ltd., and affiliates, filed for chapter 11 protection on July 15, 2003 (Bankr. S.D.N.Y. Case Nos. 03-41710). The Court confirmed Loral's plan on August 1, 2005. SEAGATE TECHNOLOGY: Board Okays $2.5 Billion Stock Repurchase ------------------------------------------------------------- Seagate Technology's Board of Directors has authorized the repurchase up to $2.5 billion of its outstanding shares of common stock over the next 24 months. The program, the Company disclosed, reinforces its ongoing commitment to enhance shareholder value in which, during fiscal year 2006, it returned over $500 million to its shareholders through stock repurchases and quarterly dividends. The new repurchase program represents approximately 20% of the company's capitalization. As of July 28, 2006, the Company had approximately 576 million shares of stock outstanding. The Company also disclosed, it expects to fund the stock repurchase through a combination of cash on hand, future cash flow from operations and potential alternative sources of financing. Headquartered in Scotts Valley, California, Seagate Technology (NYSE: STX) -- http://www.seagate.com/-- is the worldwide leader in the design, manufacturing and marketing of hard disc drives, providing products for a wide-range of Enterprise, Desktop, Mobile Computing, and Consumer Electronics applications. Seagate's business model leverages technology leadership and world-class manufacturing to deliver industry-leading innovation and quality to its global customers, and to be the low cost producer in all markets in which it participates. The company is committed to providing award-winning products, customer support and reliability to meet the world's growing demand for information storage. * * * Moody's confirmed Seagate's Corporate Family Rating of Ba1 and upgraded ratings of Seagate's $400 million senior notes 8%, due 2009 to Ba1, Maxtor's remaining $135 million of the $230 million 6.8% convertible senior notes, due 2010 to Ba1 from B2 and Maxtor Corporation's $60 million 5-3/4% convertible subordinated debentures, due 2012 to Ba2 from Caa1. The rating outlook is stable. SECURE COMPUTING: Moody's Rates Proposed $110 Mil. Loans at B2 -------------------------------------------------------------- Moody's Investors Service assigned a B2 Corporate Family Rating and B2 ratings to Secure Computing Corporation's proposed $20 million senior secured Revolving Credit Facility and $90 million senior secured Term Loan. Proceeds of the loans will be used to purchase CipherTrust and for general corporate purposes. Moody's also assigned a SGL-2 speculative grade liquidity rating. The outlook is stable. * Corporate family rating -- B2 * $20 million first lien senior secured revolving credit facility -- B2 * $90 million first lien senior secured term loan -- B2 * Speculative Grade Liquidity Rating -- SGL-2 The outlook is stable The B2 corporate family rating for Secure Computing reflects the company's moderately high leverage post closing at 3.7x LTM pro forma EBITDA, the strength of competition from larger equipment makers such as Cisco, Juniper, and Nokia, the rapidly evolving nature of the security software business and recent softness in revenues at Secure Computing relating to the CyberGuard acquisition. The rating also reflects the market strength of Secure Computing within their core product lines as well as a leading market position of CipherTrust's messaging security suite. The SGL-2 rating reflects the company's moderate liquidity though at close cash balance will be modest. The company is expected to generate positive free cash flow on a quarterly basis over the next 12 months. However, there is a possibility that it may have to tap into its liquidity facility given the modest cash balance. The stable outlook incorporates continued growth at CipherTrust and a modest recovery from Secure Computing product lines. The ratings and outlook assume the security software and appliance industry will continue to evolve but that Secure Computing will maintain its strong niche position. The ratings could move up if their market share strengthens accompanied by sustained organic revenue and EBITDA growth and a meaningful decrease in leverage levels. The ratings could move down if the Company's core product revenues continue to decline or if the company makes a large debt financed acquisition. Secure Computing is a provider of enterprise security products. The Company is headquartered in San Jose, California. SECURE COMPUTING: S&P Rates Proposed $110 Million Loan at B ----------------------------------------------------------- Standard & Poor's Rating Services assigned its 'B' corporate credit rating to San Jose, California-based Secure Computing Corp. The outlook is positive. At the same time, S&P assigned a 'B' rating with a recovery rating of '2' to the company's proposed first-lien loan of $110 million (consisting of a term B loan of $90 million and an undrawn revolving credit facility of $20 million). The recovery rating on the first-lien loan indicates expectations for substantial recovery (80% to 100%) of principal in the event of a payment default. Proceeds of the facility, including $90 million in first-lien term loan, as well as a $10 million "earn-in" Seller's Note, in conjunction with $103 million of existing cash and $79 million in equity, will be used to fund the acquisition of Cipher Trust, which makes software aimed at securing the e-mail messaging market. The acquisition will total about $274 million. "The rating on Secure Computing reflects the company's rapid growth, narrow business profile, secondary market positions, acquisition integration risks, and high leverage," said Standard & Poor's credit Stephanie Crane. "These factors are partially offset by relatively high barriers to entry, recurring revenues based on a maintenance stream, and a market that has strong growth potential." Secure Computing provides software solutions and appliances that enable secure Internet usage at the enterprise level, providing enterprise-based clients with protection against corruption by viruses, identity theft, or bandwidth "clog" caused by spam. The acquisition of Cipher Trust provides Secure Computing with software and appliances aimed at the e-mail messaging market, which complements Secure Computing's overall product offering. It also expands the client base with the addition of 2,500 enterprise customers with a need for these products. Secure Computing's software and appliances protect the enterprise at two levels: * between the Internet and network by providing the firewall and identity tokens; and * also between the application and the Internet, by providing software aimed at e-mail messaging and web solutions. The positive outlook reflects financial leverage that provides a modest cushion for the rating over the course of the integration of the Cyber Guard and the Cipher Trust acquisitions. An upgrade of the rating could come from improved financial leverage, driven by stronger-than-expected profitability due to a successful integration process or quicker-than-expected development and adoption of new products. On the other hand, the outlook could be revised to stable as a result of rising leverage from current levels stemming from lower-than-expected profitability arising from integration issues. SENIOR HOUSING: Earns $12.6 Million in Quarter Ended June 30 ------------------------------------------------------------ Senior Housing Properties Trust reports net income of $12,686,000 for the three months ended June 30, 2006 from total revenues of $41,276,000. The Company's balance sheet at June 30, 2006 showed total assets of $1,490,557,000, total liabilities of $588,733,000 and total shareholders' equity of $901,824,000. A full-text copy of the Company's financial report for the quarter ended June 30, 2006 is available for free at: http://researcharchives.com/t/s?f38 Senior Housing Properties Trust is a real estate investment trust, or REIT, investing in senior housing properties, including apartment buildings for aged residents, independent living properties, assisted living facilities and nursing homes. As of Dec. 31, 2005, the Company owned 188 properties located in 32 states with a book value of $1.7 billion before depreciation. * * * In June 2005, Fitch Ratings affirmed the 'BB+' senior unsecured debt rating of Senior Housing Properties Trust. Fitch also affirmed the 'BB-' rating of trust preferred securities issued by SNH Capital Trust I, a wholly owned financing subsidiary of SNH. The outlook was stable. SFG LP: Case Summary & 40 Largest Unsecured Creditors ----------------------------------------------------- Lead Debtor: SFG, LP 6801 Jefferson Northeast Suite 500 Albuquerque, New Mexico 87109 Tel: (505) 855-9500 Bankruptcy Case No.: 06-11207 Debtor-affiliates filing separate chapter 11 petitions on August 7, 2006: Entity Case No. ------ -------- Sandia Food Group Inc. 06-11212 Debtor-affiliates filing separate chapter 11 petitions on August 8, 2006: Entity Case No. ------ -------- Sandia Food Group El Paso Operating 1 Ltd. 06-11222 SFG NEEP GP, Inc. 06-11223 SFG NEEP, Ltd. 06-11224 Type of Business: The Debtors operate an Italian restaurant. See http://www.sandiafood.com/ Chapter 11 Petition Date: August 4, 2006 Court: Western District of Texas (Austin) Judge: Frank R. Monroe Debtors' Counsel: Patricia Baron Tomasco, Esq. Brown McCarroll, L.L.P. 111 Congress Avenue, Suite 1215 Austin, Texas 78701 Tel: (512) 479-5456 Fax: (512) 479-1155 Estimated Assets Estimated Debts ---------------- --------------- SFG, LP $10 Million to $10 Million to $50 Million $50 Million Sandia Food Group Inc. $10 Million to $10 Million to $50 Million $50 Million Sandia Food Group El Paso $100,000 to $500,000 to Operating 1 Ltd. $500,000 $1 Million SFG NEEP GP, Inc. $100,000 to $500,000 to $500,000 $1 Million SFG NEEP, Ltd. $100,000 to $500,000 to $500,000 $1 Million A. 20 Largest Unsecured Creditors of: -- SFG, LP -- Sandia Food Group Inc. Entity Nature of Claim Claim Amount ------ --------------- ------------ Kona Restaurant Group, Inc. Royalties $1,781,000 7500 Rialto Boulevard Suite 250 Austin, TX 78735 Zanios Foods, Inc. Trade debt $350,000 P.O. Box 27730 Albuquerque, NM 87125-7730 Firemans Fund Insurance Co. Commercial Insurance $122,251 Cashier 8th Floor MZX80832172 1999 Bryan Street Dallas, TX 75201 Krass Monroe PA Professional fees $119,906 8000 Norman Center Drive Suite 1000 Minneapolis, MN 55437 RSM McGladrey Professional fees $77,000 3600 American Boulevard West 3rd Floor Bloomington, MN 55431 Sun Valley Distribution Inc. Trade $56,619 Delta Marketing, Inc. Trade $45,270 Brown & McCarroll LP Professional fees $41,068 Encore Trade debt $30,627 NCA Architecture Trade debt $27,798 Neon Express Trade debt $24,913 Colormark Trade debt $24,504 Clear Channel Outdoor Trade debt $15,960 Ecolab Pest Elimination Trade debt $14,281 Holiday Inn Ocotillo Trade debt $13,881 Greenville Antiques Trade debt $13,776 Smith Engineering Trade debt $12,817 Unifirst Corporation Trade debt $12,192 Holiday Inn Express Chandler Trade debt $10,970 Martinez Brothers Trade debt $10,400 Landscaping B. 20 Largest Unsecured Creditors of: -- Sandia Food Group El Paso Operating 1 Ltd. -- SFG NEEP GP, Inc. -- SFG NEEP, Ltd. Entity Nature of Claim Claim Amount ------ --------------- ------------ Kona Restaurant Group, Inc. Royalties $1,781,000 7500 Rialto Boulevard Suite 250 Austin, TX 78735 Zanios Foods, Inc. Trade debt $350,000 P.O. Box 27730 Albuquerque, NM 87125-7730 Firemans Fund Insurance Co. Commercial Insurance $122,251 Cashier 8th Floor MZX80832172 1999 Bryan Street Dallas, TX 75201 Krass Monroe PA Professional fees $119,906 8000 Norman Center Drive Suite 1000 Minneapolis, MN 55437 RSM McGladrey Professional fees $77,000 3600 American Boulevard West 3rd Floor Bloomington, MN 55431 Bill & Pennyann Lothriner Promissory note $74,214 Sun Valley Distribution Inc. Trade $56,619 Delta Marketing, Inc. Trade $45,270 Encore Trade debt $30,627 NCA Architecture Trade debt $27,798 Neon Express Trade debt $24,913 Colormark Trade debt $24,504 Clear Channel Outdoor Trade debt $15,960 Ecolab Pest Elimination Trade debt $14,281 Holiday Inn Ocotillo Trade debt $13,881 Greenville Antiques Trade debt $13,776 Smith Engineering Trade debt $12,817 Unifirst Corporation Trade debt $12,192 Holiday Inn Express Chandler Trade debt $10,970 Martinez Brothers Trade debt $10,400 Landscaping SMITHFIELD FOODS: S&P Places BB+ Rating on Negative Watch --------------------------------------------------------- Standard & Poor's Ratings Services placed its 'BB+' corporate credit rating and other ratings for Smithfield Foods Inc. on CreditWatch with negative implications. Smithfield, Virginia-based Smithfield Foods has approximately $1.7 billion of rated debt outstanding. The CreditWatch placement follows the announcement that Groupe Smithfield S.L., the company's 50/50 joint venture with Oaktree Capital Management LLC (which acquired Sara Lee Corp.'s European meats business for $575 million), was temporarily operating under a 90-day EUR328,977,325 unsecured credit facility (about $421 million) that is guaranteed by Smithfield Foods. Groupe Smithfield expects to replace this interim financing with a standalone, nonrecourse permanent financing credit facility in the next 60 days. "If such nonrecourse financing should occur, we would likely affirm our ratings on Smithfield Foods and remove them from CreditWatch," said Standard & Poor's credit analyst Jayne Ross. "However, if Groupe Smithfield does not obtain permanent nonrecourse financing, or if there is any type of guarantee from Smithfield Foods, we would review the ratings for a possible downgrade. We will continue to monitor the situation." TANGER FACTORY: Unit Prices $130 Mil. Exchangeable Notes Offering ----------------------------------------------------------------- Tanger Properties Limited Partnership, the subsidiary of Tanger Factory Outlet Centers, Inc., priced its offering of exchangeable senior notes due 2026. TPLP is selling $130 million aggregate principal amount of the notes with a coupon of 3.75%. The notes will be exchangeable into Tanger Factory Outlet Centers, Inc. common shares at an initial exchange ratio, subject to adjustment, of 27.6856 shares per $1,000 principal amount of notes (or an initial exchange price of $36.1198 per common share). Up to an additional $19.5 million principal amount of notes may be issued pursuant to the underwriters' 30 day over-allotment option. The offering is expected to close on Aug. 16, 2006. The notes will be senior unsecured obligations of TPLP and will be guaranteed by Tanger Factory Outlet Centers, Inc. on a senior unsecured basis. TPLP intends to use the net proceeds from the offering to repay certain mortgage debt outstanding including associated prepayment charges, unsecured revolving lines of credit and other variable rate debt. Any remaining proceeds will be used to make investments in additional properties or development of existing properties and for general corporate purposes. The notes may be exchanged at the option of holders at any time on or after Aug. 18, 2011, and prior thereto only upon the occurrence of specified events. Upon exchange, TPLP will pay cash in an amount equal to the lesser of the exchange value and the aggregate principal amount of the notes to be exchanged, and, at the option of Tanger Factory Outlet Centers, Inc., company common shares, cash, or a combination thereof for any excess, at the applicable exchange rate. The notes will be redeemable at par at the option of TPLP on or after Aug. 18, 2011, and noteholders may require TPLP to repurchase the notes on Aug. 18, 2011, Aug. 15, 2016, or Aug. 15, 2021 at par plus any accrued and unpaid interest up to, but excluding, the repurchase date. Citigroup Global Markets Inc. and Banc of America Securities LLC are acting as joint bookrunning managers. Headquarteres in Greensboro, North Carolina, Tanger Factory Outlet Centers, Inc. (NYSE: SKT) -- http://www.tangeroutlet.com/-- is a fully integrated, self-administered and self-managed publicly traded REIT. The Company presently owns 29 centers in 21 states coast to coast, totaling 8 million square feet of gross leasable area. Tanger also manages for a fee and owns a 50% interest in one center containing 402,000 square feet and manages for a fee three centers totaling 293,000 square feet. * * * Moody's Investors Service assigned a Ba1 rating on Tanger Factory's Preferred Stock in June 2005. TENET HEALTHCARE: Posts $398 Million Net Loss in 2006 Second Qtr. ----------------------------------------------------------------- Tenet Healthcare Corporation reported a net loss of $398 million for its second quarter ended June 30, 2006. This compares to a net loss of $33 million in the second quarter of 2005. The net loss for the second quarter of 2006 includes a loss from continuing operations of $447 million compared to a loss of $9 million in the second quarter of 2005. The loss from continuing operations in the second quarter of 2006 included litigation and investigation costs of $0.98 per share. Income from discontinued operations in the second quarter of 2006 was $49 million compared to a loss of $24 million in the second quarter of 2005. "Strong pricing and cost control more than offset continued weakness in admissions and increases in bad debt during the second quarter, which enabled us to exceed our expectations for the quarter," said Trevor Fetter, Tenet's president and chief executive officer. "We also succeeded in the second quarter in settling the most significant of the major legal issues facing the Company, and, most importantly, we continued to make progress and receive recognition for further improvements in clinical quality and service. We believe the Company is now well positioned to grow." Continuing Operations The loss from continuing operations for the second quarter of 2006 was $447 million including these items: (1) litigation and investigation costs of $728 million pre-tax, $460 million after-tax before the impact of the valuation allowance including a pre-tax charge of $711 million for a settlement with the Department of Justice; (2) impairment and restructuring charges, net of insurance recoveries, of $27 million pre-tax, $27 million after-tax before the impact of the valuation allowance; (3) hurricane insurance recoveries, net of costs of $13 million pre-tax, $8 million after-tax before the impact of the valuation allowance; (4) favorable net adjustments for prior year cost reports and prior year cost report valuation allowances, primarily related to Medicare and Medicaid, of $4 million pre-tax, $3 million after-tax before the impact of the valuation allowance; (5) an unfavorable, non-cash adjustment to increase the company's total valuation allowance for deferred tax assets related to continuing operations of $2 million; and (6) a favorable non-cash adjustment to reduce tax exposure reserves of $7 million. In addition, the Company incurred stock compensation expense, included in salaries, wages and benefits, of $11 million pre-tax, $7 million after-tax in the second quarter of 2006 as compared to $13 million pre-tax, $8 million after-tax in the second quarter of 2005. Adjusted EBITDA in the second quarter of 2006 was $209 million producing a margin of 9.5 percent an increase of $56 million from adjusted EBITDA of $153 million in the second quarter of 2005, and an increase of 240 basis points from the adjusted EBITDA margin of 7.1 percent in the second quarter of 2005. A reconciliation of adjusted EBITDA to net loss is set forth at the end of this release. About Tenet Healthcare Based in Dallas, Texas Tenet Healthcare Corporation (NYSE: THC) -- http://www.tenethealth.com/-- through its subsidiaries, owns and operates acute care hospitals and related health care services. Tenet's hospitals aim to provide the best possible care to every patient who comes through their doors, with a clear focus on quality and service. * * * As reported in the Troubled Company Reporter on July 4, 2006, In light of the announcement of the settlement of investigations being conducted by the Department of Justice and a number of State Attorneys into Medicare outlier payments, Fitch Ratings affirmed 'B-' issuer default rating and 'B-/RR4' senior unsecured debt recovery rating for Tenet Healthcare Corp., with a Negative Rating Outlook. THE PANTRY: Earns $20.3 Million in Third Quarter Ended June 29 -------------------------------------------------------------- For the third fiscal quarter ended June 29, 2006, The Pantry Inc. reported net income of $20.3 million, a 22.2% increase compared to $16.6 million a year ago. The Company's total revenues for the quarter were approximately $1.6 billion, up 41.0% from the corresponding period last year. Commenting on the results, Peter J. Sodini, the Company's chairman and chief executive officer, said, "These record results reflect our continued solid execution of the basics at the store level, the impact of successful acquisitions over the past year, and a favorable industry environment in the gasoline business. We are particularly pleased with the strong 5.8% increase in comparable store merchandise sales and the 17.3% increase in overall merchandise gross profits. Our results continue to benefit from the rebranding of most of our stores under the Kangaroo Express(SM) banner over the last few years, the ongoing fine- tuning of our merchandise offerings to meet consumers' convenience needs, and our focus on higher-margin opportunities in food service and private label products." Nine Months 2006 Results For the first nine months of fiscal 2006, the Company's net income was $62.5 million, compared with $32.4 million in the corresponding period last year. EBITDA for the first nine months of fiscal 2006 was $204.1 million, up 44.6% from a year ago. About The Pantry Headquartered in Sanford, North Carolina, The Pantry, Inc. operates convenience store chains in the southeastern United States. As of June 29, 2006, the Company operated 1,499 stores in eleven states under select banners including Kangaroo Express(SM), its primary operating banner. * * * In May 2006, Standard & Poor's Ratings Services raised its corporate credit rating on The Pantry Inc. to 'BB-' from 'B+'. At the same time, the bank loan rating was raised to 'BB' from 'BB-', with the recovery rating unchanged at '1', indicating expectations for full recovery of principal in the event of a default. The subordinated debt rating was also raised to 'B' from 'B-'. The outlook was stable. THERMADYNE HOLDINGS: Posts $31 Mil. Net Loss in Year Ended Dec. 31 ------------------------------------------------------------------ For the year ended Dec. 31, 2005, Thermadyne Holdings Corporation reported net loss of $31,361,000 from net sales of $468,616,000. At Dec. 31, 2005, the Company has total assets of $576,468,000, total liabilities of $4452,515,000 and total shareholders' equity of $123,953,000. A full-text copy of the Company's financial report for the year ended Dec. 31, 2005 is available for free at: http://researcharchives.com/t/s?f56 About Thermadyne Based in St. Louis, Missouri, Thermadyne Holdings Corporation (Pink Sheets: THMD) -- http://www.Thermadyne.com/-- markets cutting and welding products and accessories under a variety of brand names including Victor(R), Tweco(R), Arcair(R), Thermal Dynamics(R), Thermal Arc(R), Stoody(R), and Cigweld(R). Its common shares trade under the symbol THMD.PK. * * * Moody's Investors Service downgraded Thermadyne Holdings Corp.'s corporate family rating from B2 to Caa1 as well as the Company's rating on its $175 million 9.25% senior subordinated notes due 2014 to Caa2 from Caa1. The outlook was changed to negative. Moody's did not rate Thermadyne's senior secured debt. Standard & Poor's Ratings Services also lowered its ratings on Thermadyne Holdings Corp., including its corporate credit rating to 'CCC' from 'B-'. The outlook on the St. Louis, Missouri-based welding products manufacturer remains negative. U.S. STEEL: Earns $404 Million in Second Quater of 2006 ------------------------------------------------------- United States Steel Corporation reported a net income of $404 million, second quarter 2006, compared to first quarter 2006 net income of $256 million and second quarter 2005 net income of $249 million "Solid demand in our key end markets, outstanding operating performance, strong shipments and firming prices, particularly in spot markets, resulted in an excellent second quarter with earnings significantly higher than both the previous quarter and the same quarter last year," Commenting on results, U. S. Steel Chairman and CEO John P. Surma said. "We operated at high rates of production capability in the U.S. and Europe, reflecting an outstanding performance by our people and the benefits of our recent capital programs." The company reported second quarter 2006 income from operations of $514 million, compared with income from operations of $369 million in the first quarter of 2006 and $421 million in the second quarter of 2005. The income tax provision in the second quarter of 2006 included a favorable adjustment of $15 million, or 12 cents per diluted share, related to the 2005 estimated tax accrual. During the second quarter of 2006, our 7% Series B Mandatory Convertible Preferred Shares automatically converted into common stock, increasing our common stock outstanding by approximately 16 million shares. The Company repurchased 1.9 million shares of common stock for $117 million during the second quarter, bringing the total shares repurchased to 7.7 million for $371 million since our repurchase program was authorized in July 2005. Reportable Segments and Other Businesses Management believes segment income from operations is a key measure in evaluating company performance. U. S. Steel's reportable segments and Other Businesses reported segment income from operations of $579 million in the second quarter of 2006, compared with $429 million in the first quarter of 2006 and $495 million in the second quarter of 2005. The increase in second quarter 2006 Flat-rolled income from operations compared to the first quarter mainly resulted from higher average realized prices and shipment volumes. Costs remained in line with first quarter levels as lower energy and outage costs were offset by higher raw material and profit-based costs. The improvement in European operating results was due primarily to higher prices and record shipments. Tubular operating results remained strong, but declined as expected from the first quarter due to scheduled maintenance outages, which were completed as planned. Outlook "We expect continued strong operating results for our three reportable segments in the third quarter of 2006," Commenting on U. S. Steel's outlook, Surma said. "Healthy steel consumption levels are expected during the quarter along with further increases in flat-rolled prices in the U.S. and in Europe." For Flat-rolled, the Company expects increased third quarter 2006 average realized prices, partially offset by increased costs for raw materials and outages, and shipments are expected to be comparable to second quarter levels. Third quarter average realized prices are also expected to improve for U. S. Steel Europe, partially offset by higher costs, primarily for raw materials. Shipments are expected to remain at second quarter levels. In Serbia, the Company is currently involved in discussions with our employees, unions and government agencies regarding a workforce reduction plan that may be initiated as early as the third quarter. Shipments and average realized prices for the Tubular segment in the third quarter of 2006 are expected to be in line with second quarter levels, and costs are expected to improve due mainly to lower outage costs. About the Company U.S. Steel (NYSE: X) -- http://www.ussteel.com/-- through its domestic operations, is engaged in the production, sale and transportation of steel mill products, coke, and iron- bearing taconite pellets; the management of mineral resources; real estate development; and engineering and consulting services and, through its European operations, which include U. S. Steel Kosice, located in Slovakia, and U. S. Steel Balkan located in Serbia, in the production and sale of steel mill products. Certain business activities are conducted through joint ventures and partially owned companies. United States Steel Corporation is a Delaware corporation. * * * As reported on the Troubled Company Reporter on July 31, 2006, Standard & Poor's Ratings Services placed its ratings, including its 'BB' corporate credit rating, on Pittsburgh, Pennsylvania- based United States Steel Corp. on CreditWatch with positive implications. As reported on the Troubled Company Repoter on March, 23, 2006, Moody's Investors Service upgraded the ratings for United States Steel Corporation, raising the company's corporate family rating to Ba1 from Ba2. In a related rating action, Moody's affirmed US Steel's SGL-1 speculative grade liquidity rating. The upgrade reflects the company's significantly strengthened operating margins and coverage ratios, its improved capital structure, and its greater geographic diversification. As a result, Moody's views the company as better placed to cope with the inherent cyclicality of its markets and the high operating leverage of its asset base. The rating outlook is stable. UTILITY CRAFT: Creditors Meeting Scheduled for August 22 -------------------------------------------------------- A meeting of Utility Craft Inc.'s creditors is set at 10:00 a.m., on August 22, 2006, at the Creditors Meeting Room, First Floor, 101 South Edgeworth Street in Greensboro, North Carolina. 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 High Point, North Carolina, Utility Craft, Inc., dba Wood Armfield Furniture, specializes in manufacturing high quality furniture and accessories. The Company filed for chapter 11 protection on July 20, 2006 (Bankr. M.D. N.C. Case No. 06- 10816). Christine L. Myatt, Esq., and J. David Yarbrough, Jr., Esq., at Nexsen Pruet Adams Kleemeier, PLLC, represent the Debtor. When the Debtor filed for protection from its creditors, it estimated assets between $1 million and $10 million and debts between $10 million and $50 million. VESTA INSURANCE: First Meeting of Creditors Slated for Sept. 12 --------------------------------------------------------------- The Bankruptcy Administrator for the District of Alabama will convene a meeting of Vesta Insurance Group, Inc.'s and J. Gordon Gaines' unsecured creditors at 1:30 p.m. on Sept. 12, 2006, at the Robert S. Vance Federal Building, Room 127, at 1800 5th Avenue in Birmingham, Alabama. This is the first meeting of creditors required under Sec. 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 Debtors under oath about the company's financial affairs and operations that would be of interest to the general body of creditors. About Vesta Insurance Headquartered in Birmingham, Alabama, Vesta Insurance Group, Inc. (Other OTC: VTAI.PK) -- http://www.vesta.com/-- is a holding company for a group of insurance companies that primarily offer property insurance in targeted states. Wyatt R. Haskell, Luther S. Pate, UV, and Costa Brava Partnership III, L.P., filed an involuntary chapter 7 petition against the Company on July 18, 2006 (Bankr. N.D. Ala. Case No. 06-02517). The case was converted to a voluntary chapter 11 case on Aug. 8, 2006 (Bankr. N.D. Ala. Case No. 06-02517). Eric W. Anderson, Esq., at Parker Hudson Rainer & Dobbs, LLP, represents the Debtor. R. Scott Williams, Esq., at Haskell Slaughter Young & Rediker, LLC, represents the petitioning creditors. At Dec. 31, 2004, Vesta Insurance's balance sheet showed $1,764,247,000 in total assets and $1,810,022,000 in total liabilities resulting in a $45,775,000 stockholders' deficit. On Aug. 1, 2006, the District Court of Travis County, Texas entered the Order appointing the Texas Commissioner of Insurance as Liquidator of Vesta Insurance's Texas-domiciled subsidiaries: Vesta Fire Insurance Corporation; The Shelby Insurance Company; Shelby Casualty Insurance Corporation; Texas Select Lloyds Insurance Company; and Select Insurance Services, Inc. (Vesta Bankruptcy News, Issue No. 1; Bankruptcy Creditors' Service, Inc., 215/945-7000, http://bankrupt.com/newsstand/). VESTA INSURANCE: John Centineo Asks Tex. Dist. Court to Lift Stay ----------------------------------------------------------------- John Centineo asks the Texas District Court to lift the stay to allow him to proceed with production in order to determine if the stay is applicable to a case pending in the 334th Judicial District Court of Harris County, Texas. Mr. Centineo is a defendant in a lawsuit filed by Romeo Montalvo and Margaret Montalvo on June 17, 2003. The Montalvos accused Mr. Centineo of slander. Mr. Centineo counter sued for breach of contract. The Montalvos initially disclosed that there is no insurance to afford defense and indemnity for the cause of action filed by Mr. Centineo. On July 14, 2006, Judge McCally of the 334th Judicial District Court was presented a Notice of Appointment of Rehabilitation and Automatic Stay by counsel for the Montalvos. Judge McCally granted a stay of the entire case that involves 10 other parties and did so without any motion for a stay being presented, Mr. Centineo says. According to Mr. Centineo, the Montalvos are misrepresenting true facts to Judge McCally. Mr. Centineo points out, among others, that: -- the Montalvos have not presented any evidence demonstrating their insured-insurer relationship with Texas Select Lloyds Insurance; -- he has never filed a claim with Texas Select Lloyds Insurance; and -- the Montalvos have failed to produce evidence that reflects they have insurance coverage with Texas Select Lloyds Insurance that would respond to the issues before the 334th Judicial District Court. Mr. Centineo relates that the Montalvos now have three pending causes of action against them -- breach of contract, invasion of privacy, and public disclosure of private facts. Mr. Centineo notes that the Montalvos could be requesting protection because of the injunction for something that they are not afforded that protection because they do not have coverage under their policy. "If there is insurance coverage." Mr. Centineo contends that he has been severely prejudiced by the Montalvos' deceit. "The Notice [of] Appointment of Rehabilitator and Automatic Stay should have absolutely no meaning in the case before Judge McCally until the Montalvos produce evidence to show they are insured with Texas Select Lloyds Insurance and that Texas Select Lloyds Insurance is affording defense and indemnity for all causes of action filed against them by Mr. Centineo." About Vesta Insurance Headquartered in Birmingham, Alabama, Vesta Insurance Group, Inc. (Other OTC: VTAI.PK) -- http://www.vesta.com/-- is a holding company for a group of insurance companies that primarily offer property insurance in targeted states. Wyatt R. Haskell, Luther S. Pate, UV, and Costa Brava Partnership III, L.P., filed an involuntary chapter 7 petition against the Company on July 18, 2006 (Bankr. N.D. Ala. Case No. 06-02517). The case was converted to a voluntary chapter 11 case on Aug. 8, 2006 (Bankr. N.D. Ala. Case No. 06-02517). Eric W. Anderson, Esq., at Parker Hudson Rainer & Dobbs, LLP, represents the Debtor. R. Scott Williams, Esq., at Haskell Slaughter Young & Rediker, LLC, represents the petitioning creditors. At Dec. 31, 2004, Vesta Insurance's balance sheet showed $1,764,247,000 in total assets and $1,810,022,000 in total liabilities resulting in a $45,775,000 stockholders' deficit. On Aug. 1, 2006, the District Court of Travis County, Texas entered the Order appointing the Texas Commissioner of Insurance as Liquidator of Vesta Insurance's Texas-domiciled subsidiaries: Vesta Fire Insurance Corporation; The Shelby Insurance Company; Shelby Casualty Insurance Corporation; Texas Select Lloyds Insurance Company; and Select Insurance Services, Inc. (Vesta Bankruptcy News, Issue No. 1; Bankruptcy Creditors' Service, Inc., 215/945-7000, http://bankrupt.com/newsstand/). WARNACO GROUP: Financial Restatement Prompts S&P's Stable Outlook ----------------------------------------------------------------- Standard & Poor's Ratings Services revised its outlook on The Warnaco Group Inc.'s ratings to stable from positive. At the same time, the ratings on Warnaco were affirmed, including its 'BB-' corporate credit rating. Total debt outstanding at April 1, 2006, was about $431 million. "The outlook revision follows the company's announcement that it will restate its financial statements for the fiscal year ended December 2005 and the first quarter of 2006 ended April 1, 2006, as a result of certain irregularities and errors related to its accounting for returns and vendor allowances at its Chaps menswear division," said Standard & Poor's credit analyst Susan H. Ding. The financial impact of these restatements will not significantly affect credit protection measures. However, the company needs to restate its financial statements due to accounting irregularities and an error related to the company's SAP implementation in its swimwear division. These items will result in reported material weaknesses for its financial statements. In addition, Warnaco needs to seek waivers for certain technical defaults under its credit agreement. The ratings on New York-based Warnaco reflect its participation in a highly competitive and promotional retail environment, its concentration in the slower-growing department store channel, and its exposure to fashion risk in some of its business segments. The ratings also incorporate the operating risk associated with reinvigorating the company's various product offerings and the integration risk related to the company's acquisition of the Calvin Klein businesses in Europe and Asia. Furthermore, the ratings reflect Warnaco's positive operating momentum and its well-recognized brand names. Warnaco manufactures and markets men's and women's intimate apparel, underwear, and sportswear (including jeans, khakis, and swimwear). Products are sold under owned and licensed names such as Olga, Warner's, Anne Cole, Ocean Pacific, Speedo, Chaps, and Calvin Klein, among others. Some of Warnaco's core products are characterized by relatively stable demand. S&P expects Warnaco to maintain credit measures that are stronger than the medians for the current rating, given the company's business challenges. Still, if the company can improve and sustain financial results in the intermediate term, including reducing debt leverage, the outlook may be revised back to positive. However, if the company is not able to sustain its operating momentum and engages in share repurchases or additional acquisitions, or if the company faces integration problems, or if further restatements or adjustments are found upon the completion of the internal accounting investigation, the ratings and outlook would be reviewed. WEIGHT WATCHERS: Moody's Rates $850 Million Sr. Sec. Loan at Ba1 ---------------------------------------------------------------- Moody's Investors Service assigned a Ba1 rating to the $850 million senior secured credit facility of Weight Watchers International, Inc. and affirmed the Ba1 Corporate Family Rating. The ratings outlook remains stable. The $850 million credit facility consists of a $350 million term loan A and a $500 million revolving credit facility. Proceeds from the term loan A and $127 million of revolver borrowings were used to repay borrowings under Weight Watchers' previous credit facility. The Ba1 corporate family and credit facility ratings benefit from strong credit metrics, impressive operating margins, a leading market position and growing obesity rates worldwide. The ratings are primarily constrained by uncertainty related to the firm's target capital structure and expected financial policies, lack of product diversification and threats from competitive products. Moody's took these rating actions: * Assigned Ba1 rating to the $500 million senior secured revolving credit facility due 2011 * Assigned Ba1 rating to the $350 million senior secured term loan facility due 2011 * Withdrew $350 million secured revolving credit facility due 2009, rated Ba1 * Withdrew $294 million senior secured term loan B due 2010, rated Ba1 * Affirmed the Ba1 Corporate Family Rating The stable ratings outlook anticipates moderate revenue growth and stable operating margins. Cash flows from operation are expected to be utilized primarily to fund dividends, share repurchases, required debt amortization and franchisee acquisitions. The rating outlook could be changed to positive if Moody's believes that Weight Watchers': (1) is committed to maintaining a capital structure consistent with an investment grade profile and (2) can maintain or grow its business despite threats from competitive products such as new diet plans and weight loss drugs. Moody's notes that Weight Watchers implemented a $70 million annual dividend in 2006 and has aggressively repurchased company common stock over the last two years. The most likely trigger for a ratings downgrade is a significant increase in leverage due to a recapitalization or repurchase of a significant block of shares held by Artal Luxemborg. A moderate weakening in financial performance would probably not create downward pressure on the ratings due to company's strong credit metrics and cash flow generation. Over the longer term, the outlook or ratings could come under pressure if attendance levels and operating margins decline for an extended period of time and result in a significant reduction in free cash flow. Headquartered in Woodbury, New York, Weight Watchers is a leading global provider of weight management services, operating in 30 countries through a network of company owned and franchised operations. Revenues for the year ended December 31, 2005 were about $1.2 billion. WENDY'S INT'L: Posts $29 Million Net Loss in 2nd Quarter of 2006 ---------------------------------------------------------------- Wendy's International Inc. reported net loss of $29.1 million from total revenues of $1.0 billion for the second quarter of 2006. The Company's net loss for the quarter compares with the second quarter 2005 net income of $70.8 million. Commenting on the results, Kerrii Anderson, the Company's interim chief executive officer and president, said, "[o]ur reported second-quarter results for the overall company were lower than expected, primarily due to factors unrelated to the performance of our core Wendy's and Tim Hortons(R) businesses. Excluding charges and costs for our restructuring initiatives, our core Wendy's(R) business is improving." "During the second quarter Wendy's produced the strongest same- store sales gains in the last seven quarters and food costs are improving. Wendy's July same-store sales trends are even stronger and are running about 3.5%. Our leadership team, operators and franchisees are excited about the turnaround of our business, and we are optimistic that our momentum will continue into the third quarter. We have a strong lineup of new and promotional products in the pipeline," Mr. Anderson added. Wendy's International Inc. -- http://www.wendys-invest.com/-- is a restaurant operating and franchising company with more than 9,900 total restaurants and quality brands, including Wendy's Old Fashioned Hamburgers(R) and Baja Fresh Mexican Grill. The Company also has investments in three additional quality brands - Tim Hortons, Cafe Express and Pasta Pomodoro(R). * * * As reported in the Troubled Company Reporter on July 3, 2006, Standard & Poor's Ratings Services lowered its corporate credit and senior unsecured debt ratings on Wendy's International Inc. to 'BB+' from 'BBB-'. At the same time, the short-term rating was lowered to 'B-1' from 'A-3'. The outlook was negative. WILLIAMS COMPANIES: Posts $76 Mil. Net Loss in 2nd Quarter 2006 --------------------------------------------------------------- For the three months ended June 30, 2006, The Williams Companies, Inc. reported net loss of $76.0 million from total revenues of $2,715.1 million. At June 30, 2006, the Company has total assets of $25,617.2 million, total liabilities of 19,734.9 million and total stockholders' equity of $5,882.3 million. A full-text copy of the Company's financial report for the quarter ended June 30, 2006 is available for free at: http://researcharchives.com/t/s?f37 Headquartered in Tulsa, Oklahoma, Williams Companies, Inc. (NYSE:WMB) -- http://www.williams.com/-- through its subsidiaries, primarily finds, produces, gathers, processes and transports natural gas. The company also manages a wholesale power business. Williams' operations are concentrated in the Pacific Northwest, Rocky Mountains, Gulf Coast, Southern California and Eastern Seaboard. * * * As reported in the Troubled Company Reporter on June 9, 2006, Moody's Investors Service upgraded The Williams Companies, Inc.'s long-term debt ratings to Ba2, Corporate Family Rating to Ba2 from Ba3 and senior unsecured debt to Ba2 from B1. The outlook was stable. WINN-DIXIE: Wants to Assume 21 Employment-Related Contracts ----------------------------------------------------------- Winn-Dixie Stores, Inc., and its debtor-affiliates ask the U.S. Bankruptcy Court for the Middle District of Florida to allow them to assume 21 prepetition employment-related contracts as of the effective date of their proposed plan of reorganization. The Debtors clarify that the assumption is conditioned on their plan being declared effective. To the extent that there has been a default under the Contracts, the Debtors agree to pay cure amounts and provide adequate assurance to the counterparties before assuming the Contracts. The Debtors also ask the Court to fix the costs of assumption of the Contracts at these cure amounts: Non-Debtor Debtors' Counterparty Cure Amount ------------ ----------- Kwentoh, Emeka I. $22,250 Barton, Joel 0 Baxley, William R. 0 Cavin, Margaret M. 0 Chisholm, Paul M. 0 Doss, Gary W. 0 Gore, Curtis M. 0 Gue, George T. Jr. 0 Hanley, Dennis 0 Matta, Mark 0 Mitchell, Mary 0 Moore, Dwight A. Jr. 0 Opasinski, John 0 Seeley, Jim 0 Sheehan, John 0 Strother, Justin D. 0 Thatcher, James H. 0 Timbrook, Stanley R. Jr. 0 Tulko, Robert 0 Wong, Roy 0 Zahra, E. Ellis Jr. 0 Counterparties who dispute the proposed cure amounts must file their objection with the Court before Aug. 17, 2006. Headquartered in Jacksonville, Florida, Winn-Dixie Stores, Inc. -- http://www.winn-dixie.com/-- is one of the nation's largest food retailers. The Company operates stores across the Southeastern United States and in the Bahamas and employs approximately 90,000 people. The Company, along with 23 of its U.S. subsidiaries, filed for chapter 11 protection on Feb. 21, 2005 (Bankr. S.D.N.Y. Case No. 05-11063, transferred Apr. 14, 2005, to Bankr. M.D. Fla. Case Nos. 05-03817 through 05-03840). D.J. Baker, Esq., at Skadden Arps Slate Meagher & Flom LLP, and Sarah Robinson Borders, Esq., and Brian C. Walsh, Esq., at King & Spalding LLP, represent the Debtors in their restructuring efforts. Paul P. Huffard at The Blackstone Group, LP, gives financial advisory services to the Debtors. Dennis F. Dunne, Esq., at Milbank, Tweed, Hadley & McCloy, LLP, and John B. Macdonald, Esq., at Akerman Senterfitt give legal advice to the Official Committee of Unsecured Creditors. Houlihan Lokey & Zukin Capital gives financial advisory services to the Committee. When the Debtors filed for protection from their creditors, they listed $2,235,557,000 in total assets and $1,870,785,000 in total debts. (Winn-Dixie Bankruptcy News, Issue No. 48; Bankruptcy Creditors' Service, Inc., 215/945-7000, http://bankrupt.com/newsstand/). WINN-DIXIE: Wants to Reject 98 Employment-Related Contracts ----------------------------------------------------------- Winn-Dixie Stores, Inc., and its debtor-affiliates seek authority from the U.S. Bankruptcy Court for the Middle District of Florida to reject prepetition contracts of former and current employees, effective immediately. A list of the 48 Former Employee Contracts and 50 Current Employee Contracts for rejection is available free of charge at http://ResearchArchives.com/t/s?f86 The offer letters, retention agreements, and other contracts of former employees are not necessary to the Debtors' ongoing businesses, D.J. Baker, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, in New York, relates. Mr. Baker clarifies that current employees who are counterparties to Current Employee Contracts are not going to be terminated and their employment status will not be affected. Rather, the rejection of their contracts is being sought as a necessary step toward the Debtors' reorganization. "Many of the contracts of current employees include provisions that are inconsistent with rights granted under Court orders and with the terms of the Plan of Reorganization. It is solely to avoid inconsistent obligations that the Debtors are seeking to reject the Current Employee Contracts," Mr. Baker explains. If the parties of the Contracts assert rejection damages, the Debtors ask the Court to establish the rejection damages deadline to be 30 days after the Court grants their request. Headquartered in Jacksonville, Florida, Winn-Dixie Stores, Inc. -- http://www.winn-dixie.com/-- is one of the nation's largest food retailers. The Company operates stores across the Southeastern United States and in the Bahamas and employs approximately 90,000 people. The Company, along with 23 of its U.S. subsidiaries, filed for chapter 11 protection on Feb. 21, 2005 (Bankr. S.D.N.Y. Case No. 05-11063, transferred Apr. 14, 2005, to Bankr. M.D. Fla. Case Nos. 05-03817 through 05-03840). D.J. Baker, Esq., at Skadden Arps Slate Meagher & Flom LLP, and Sarah Robinson Borders, Esq., and Brian C. Walsh, Esq., at King & Spalding LLP, represent the Debtors in their restructuring efforts. Paul P. Huffard at The Blackstone Group, LP, gives financial advisory services to the Debtors. Dennis F. Dunne, Esq., at Milbank, Tweed, Hadley & McCloy, LLP, and John B. Macdonald, Esq., at Akerman Senterfitt give legal advice to the Official Committee of Unsecured Creditors. Houlihan Lokey & Zukin Capital gives financial advisory services to the Committee. When the Debtors filed for protection from their creditors, they listed $2,235,557,000 in total assets and $1,870,785,000 in total debts. (Winn-Dixie Bankruptcy News, Issue No. 48; Bankruptcy Creditors' Service, Inc., 215/945-7000, http://bankrupt.com/newsstand/). WORLDCLASS PROCESSING: Confirmed Plan Bars Allegations Against CIT ------------------------------------------------------------------ The Hon. Judith K. Fitzgerald of the U.S. Bankruptcy Court for the Western District of Pennsylvania issued a memorandum opinion explaining her findings of fact and conclusions of law after the U.S. District Court for the Western District of Pennsylvania remanded proceedings in connection with the Bankruptcy Court's decision to dismiss WorldClass Processing, Inc.'s adversary proceeding against CIT Lending Services Corporation and an objection to the lender's proof of claim. In its 2003 lawsuit and claim objection, WorldClass alleged: * interference with business; * breach of duty of good faith and fair dealing; * breach of fiduciary duty; * fraudulent representations and negligent misrepresentations; and * inequitable conduct. CIT, fka Newcourt Commercial Finance Corporation and AT&T Commercial Finance Corporation, on behalf of the successor to AT&T Capital Corporation and CIT Corporation, moved to dismiss the amended complaint. In her February 10, 2005 decision, Judge Fitzgerald dismissed: a) the lawsuit based on events occurring before and after Nov. 7, 1995, based on a prior state court order, and b) the Debtor's objection to CIT's proof of claim. The Debtor appealed. The District Court remanded on the basis that the Bankruptcy Court did not: a) "explicitly identify the standard of review or burdens applied to" the matter before the Court or b) set forth elements or law defining the causes of action or applicable preclusion principles. Bankruptcy Court's Findings The Debtor asserted that CIT received more payments during the bankruptcy case than it was entitled to and it was undersecured prepetition. Judge Fitzgerald says that's not true. CIT was not undersecured and that was the basis for the chapter 11 Plan provisions providing for full payment of CIT's claims and the Financing Order dated Feb. 11, 1999. Judge Fitzgerald says that the doctrine of res judicata -- the Debtor's confirmed plan in this case -- binds every entity that holds a claim or interest and precludes parties from raising claims or issues that could or should have been raised prior to confirmation. Judge Fitzgerald rejected the Debtor's assertion of a preference cause of action because under Rule 7001 of the Federal Rules of Bankruptcy Procedure, a preference action must be commenced by an adversary complaint. Preference claims can't be raised and addressed in a motion for summary judgment or a claim objection. Moreover, the Parties' stipulation that CIT received no payments from the Debtor within the 90-day prepetition period defeated the Debtor's claim to avoid allegedly preferential prepetition transfer. The Debtor's contention that CIT was an insider due to its ownership of the Debtor's stock, and thus was subject to the one- year look-back period for preference avoidance claims was time barred since no preference avoidance action was ever commenced and the period to do so has long expired, Judge Fitzgerald says. Furthermore, the Debtor argued that CIT was in control at all relevant times, in the sense of operating the Debtor or dictating its operations was barred by the Bankruptcy Court. This argument has been adjudicated against the Debtor in state-court litigation. Judge Fitzgerald applied the Rooker-Feldman doctrine, which requires the Bankruptcy Court to give the same preclusive effect to a state court ruling that another court of the state would give. Judge Fitzgerald observes that the Debtor has already argued its breach of fiduciary duty and other allegations before the Hon. Joseph M. James of the Court of Common Pleas, in Allegheny County, Pennsylvania, Civil Division, and lost. Judge Fitzgerald won't revisit those claims. Bankruptcy Court's Ruling In a decision published at 2006 WL 1997466, Judge Fitzgerald held that: 1) the confirmed plan had res judicata effect barring the Debtor's subsequent assertion that CIT was undersecured as of the Debtor's chapter 11 filing; 2) the stipulation that CIT received no payments during preference period defeated the Debtor's preference avoidance claim; 3) the Rooker-Feldman doctrine bars the Debtor's argument, in connection with claims for alleged preferential transfers and breach of fiduciary duty, that CIT was in control of the debtor; and 4) the debtor failed to establish that CIT was overpaid. Judge Fitzgerald explained that CIT's position and her conclusion in her prior Memorandum Opinion are supported by the terms of the Debtor's confirmed Plan. Judge Fitzgerald cited that the confirmed Plan provides that: * all of CIT's rights with respect to the financing order and its prepetition credit agreement and other agreements remain in effect; and * CIT must be paid in full before any payments are made to any other creditors. In this litigation (Adv. Pro. No. 00-02672), David Bruce Salzman, Esq., and Robert O. Lampl, Esq., at Campbell & Levine, LLC, represented the Debtor, and George E. Yokitis, Esq., in Pittsburgh, Pennsylvania, represented CIT. Headquartered in Ambridge, Pennsylvania, WorldClass Processing, Inc., is a toll processor of hot rolled coils of carbon and stainless sheet steel. The Company filed for chapter 11 protection on Dec. 18, 1998 (Bankr. W.D. Penn. Case No. 98-29986). * Sheppard Mullin Hires Daniel Yannuzzi as Member ------------------------------------------------- Daniel N. Yannuzzi has joined the Del Mar Heights office of Sheppard, Mullin, Richter & Hampton LLP. Most recently with Morrison & Foerster in San Diego, Mr. Yannuzzi joins as a member of the Intellectual Property practice group. Mr. Yannuzzi has experience in all areas of intellectual property law with an emphasis in patent litigation, licensing and transactional matters, and portfolio development. He provides counsel to clients in a wide range of high technology fields, including computer architecture, electronic circuits, optics, data coding, medical devices, business methods, semiconductor processes, wireless communications, network technologies, computer graphics and computer software. "We are very pleased to welcome Dan to the Del Mar Heights office," Guy Halgren, chairman of the firm, commented. "He is an excellent fit with the office's successful, fast-growing IP group in Del Mar, which has expanded from one to ten attorneys in two years." "Dan is a great addition to the firm's IP group, which now includes over forty attorneys," Gary Clark, chair of the firm's Intellectual Property practice group, commented. "He brings an extensive background in technology-related IP, from both private practice and in-house experience." Mr. Yannuzzi is the latest addition to the firm's burgeoning San Diego IP practice. Last month, Michael Eisenberg joined the Del Mar Heights office from Fulwider Patton in Los Angeles. Also of related note, IP partner Amar Thakur was recently named a "Top San Diego County Attorney/IP Litigation" by The Daily Transcript. Previously, Mr. Yannuzzi served as Vice President of Worldwide Legal Affairs and Assistant Corporate Secretary to Skyworks Solutions, Inc., and as Vice President and Chief Intellectual Property Counsel for Conexant Systems, Inc. Additionally, he has served as primary outside patent counsel to numerous electronics, software, telecommunications and medical device companies. Mr. Yannuzzi received a J.D. from University of Maryland School of Law in 1993, a master's degree from Johns Hopkins University in 1986 and a bachelor's degree from the University of Delaware in 1982. About Sheppard, Mullin, Richter & Hampton LLP Founded in 1927, Sheppard, Mullin, Richter & Hampton LLP -- http://www.sheppardmullin.com/-- is a full service AmLaw 100 firm with more than 480 attorneys in nine offices located throughout California and in New York and Washington, D.C. The firm's California offices are located in Los Angeles, San Francisco, Santa Barbara, Century City, Orange County, Del Mar Heights and San Diego. Sheppard Mullin provides legal expertise and counsel to U.S. and international clients in a wide range of practice areas, including Antitrust, Corporate and Securities; Entertainment, Media and Communications; Finance and Bankruptcy; Government Contracts; Intellectual Property; Labor and Employment; Litigation; Real Estate/Land Use; Tax/Employee Benefits/Trusts & Estates; and White Collar Defense. * BOND PRICING: For the week of August 7 - August 11, 2006 ---------------------------------------------------------- Issuer Coupon Maturity Price ------ ------ -------- ----- ABC Rail Product 10.500% 01/15/04 1 ABC Rail Product 10.500% 12/31/04 1 Adelphia Comm. 3.250% 05/01/21 1 Adelphia Comm. 6.000% 02/15/06 0 Adelphia Comm. 7.500% 01/15/04 55 Adelphia Comm. 7.750% 01/15/09 58 Adelphia Comm. 7.875% 05/01/09 58 Adelphia Comm. 8.125% 07/15/03 44 Adelphia Comm. 8.375% 02/01/08 59 Adelphia Comm. 9.250% 10/01/02 55 Adelphia Comm. 9.375% 11/15/09 60 Adelphia Comm. 9.500% 02/15/04 54 Adelphia Comm. 9.875% 03/01/05 55 Adelphia Comm. 9.875% 03/01/07 59 Adelphia Comm. 10.250% 06/15/11 61 Adelphia Comm. 10.250% 11/01/06 57 Adelphia Comm. 10.500% 07/15/04 59 Adelphia Comm. 10.875% 10/01/10 58 Albertson's Inc 6.520% 04/10/28 75 Allegiance Tel. 11.750% 02/15/08 47 Allegiance Tel. 12.875% 05/15/08 44 Amer & Forgn Pwr 5.000% 03/01/30 66 Amer Color Graph 10.000% 06/15/10 73 Ames Dept. Stores 10.000% 04/15/06 0 Antigenics 5.250% 02/01/25 64 Anvil Knitwear 10.875% 03/15/07 57 Armstrong World 6.350% 08/15/03 68 Armstrong World 6.500% 08/15/05 68 Armstrong World 7.450% 05/15/29 68 Armstrong World 9.000% 06/15/04 69 At Home Corp. 0.525% 12/28/18 2 At Home Corp. 4.750% 12/15/06 0 ATA Holdings 12.125% 06/15/10 2 Autocam Corp. 10.875% 06/15/14 61 Bank New England 8.750% 04/01/99 5 Bank New England 9.500% 02/15/96 10 BBN Corp 6.000% 04/01/12 0 Big V Supermarkets 11.000% 02/15/04 0 Budget Group Inc 9.125% 04/01/06 0 Burlington North 3.200% 01/01/45 55 Calpine Corp 4.000% 12/26/06 25 Calpine Corp 4.750% 11/15/23 48 Calpine Corp 6.000% 09/30/14 38 Calpine Corp 7.625% 04/15/06 73 Calpine Corp 7.750% 04/15/09 73 Calpine Corp 7.750% 06/01/15 37 Calpine Corp 7.875% 04/01/08 73 Calpine Corp 8.500% 02/15/11 49 Calpine Corp 8.625% 08/15/10 49 Calpine Corp 8.750% 07/15/07 69 Calpine Corp 10.500% 05/15/06 70 Cell Therapeutic 5.750% 06/15/08 58 Charter Comm Hld 10.000% 05/15/11 68 Charter Comm Hld 11.125% 01/15/11 71 CIH 9.920% 04/01/14 63 CIH 10.000% 05/15/14 63 CIH 11.125% 01/15/14 66 Collins & Aikman 10.750% 12/31/11 10 Color Tile Inc 10.750% 12/15/01 0 Columbia/HCA 7.050% 12/01/27 71 Columbia/HCA 7.500% 11/15/95 69 Comcast Corp 2.000% 10/15/29 39 Cooper Standard 8.375% 12/15/14 75 Cray Research 6.125% 02/01/11 12 Curagen Corp 4.000% 02/15/11 75 Dal-Dflt09/05 9.000% 05/15/16 25 Dana Corp 5.850% 01/15/15 74 Decode Genetics 3.500% 04/15/11 72 Delco Remy Intl 9.375% 04/15/12 60 Delco Remy Intl 11.000% 05/01/09 63 Delphi Trust II 6.197% 11/15/33 64 Delta Air Lines 2.875% 02/18/24 25 Delta Air Lines 7.541% 10/11/11 38 Delta Air Lines 7.700% 12/15/05 22 Delta Air Lines 7.900% 12/15/09 25 Delta Air Lines 8.000% 06/03/23 25 Delta Air Lines 8.270% 09/23/07 75 Delta Air Lines 8.300% 12/15/29 25 Delta Air Lines 8.540% 01/02/07 73 Delta Air Lines 9.200% 09/23/14 73 Delta Air Lines 9.250% 03/15/22 25 Delta Air Lines 9.375% 09/11/07 63 Delta Air Lines 9.480% 06/05/06 58 Delta Air Lines 9.750% 05/15/21 27 Delta Air Lines 9.875% 04/30/08 68 Delta Air Lines 10.000% 06/01/11 58 Delta Air Lines 10.000% 06/05/13 74 Delta Air Lines 10.000% 08/15/08 24 Delta Air Lines 10.060% 01/02/16 73 Delta Air Lines 10.125% 05/15/10 25 Delta Air Lines 10.375% 02/01/11 25 Delta Air Lines 10.375% 12/15/22 24 Delta Air Lines 10.500% 04/30/16 69 Deutsche Bank NY 8.500% 11/15/16 67 Dov Pharmaceutic 2.500% 01/15/25 58 Dura Operating 9.000% 05/01/09 25 Dura Operating 9.000% 05/01/09 29 Eagle-Picher Inc 9.750% 09/01/13 72 Encysive Pharmac 2.500% 03/15/12 73 Epix Medical Inc. 3.000% 06/15/24 70 Fedders North AM 9.875% 03/01/14 70 Federal-Mogul Co. 7.375% 01/15/06 55 Federal-Mogul Co. 7.500% 01/15/09 57 Federal-Mogul Co. 8.160% 03/06/03 51 Federal-Mogul Co. 8.370% 11/15/01 53 Federal-Mogul Co. 8.800% 04/15/07 56 Finova Group 7.500% 11/15/09 30 Ford Motor Co 6.500% 08/01/18 74 Ford Motor Co 6.625% 02/15/28 73 Ford Motor Co 7.125% 11/15/25 73 Ford Motor Co 7.400% 11/01/46 72 Ford Motor Co 7.500% 08/01/26 73 Ford Motor Co 7.700% 05/15/97 69 Ford Motor Co 7.750% 06/15/43 74 Ford Motor Cred 6.150% 12/22/14 72 Ford Motor Cred 6.200% 03/20/15 75 Ford Motor Cred 6.550% 07/21/14 75 Gateway Inc. 2.000% 12/31/11 73 GB Property Fndg 11.000% 09/29/05 51 Graftech Intl 1.625% 01/15/24 72 Gulf Mobile Ohio 5.000% 12/01/56 73 HNG Internorth 9.625% 03/15/06 36 Inland Fiber 9.625% 11/15/07 60 Insight Health 9.875% 11/01/11 49 Iridium LLC/CAP 10.875% 07/15/05 27 Iridium LLC/CAP 11.250% 07/15/05 26 Iridium LLC/CAP 13.000% 07/15/05 26 Iridium LLC/CAP 14.000% 07/15/05 25 Isolagen Inc. 3.500% 11/01/24 74 K&F Industries 9.625% 12/15/10 70 Kaiser Aluminum 9.875% 02/15/02 49 Kaiser Aluminum 10.875% 10/15/06 58 Kaiser Aluminum 12.750% 02/01/03 12 Kellstrom Inds 5.500% 06/15/03 0 Kitty Hawk Inc 9.950% 11/15/04 2 Kmart Corp 8.540% 01/02/15 23 Kmart Funding 8.800% 07/01/10 30 Liberty Media 3.750% 02/15/30 58 Liberty Media 4.000% 11/15/29 64 Macsaver Financl 7.600% 08/01/07 3 Merisant Co 9.500% 07/15/13 67 Merrill Lynch 10.000% 08/15/12 72 MHS Holdings Co 16.875% 09/22/04 0 Missouri Pac RR 5.000% 01/01/45 75 Movie Gallery 11.000% 05/01/12 70 MSX Int'l Inc. 11.375% 01/15/08 66 Muzak LLC 9.875% 03/15/09 55 New Orl Grt N RR 5.000% 07/01/32 66 Northern Pacific RY 3.000% 01/01/47 55 Northern Pacific RY 3.000% 01/01/47 55 Northwest Airlines 6.625% 05/15/23 45 Northwest Airlines 7.248% 01/02/12 21 Northwest Airlines 7.625% 11/15/23 46 Northwest Airlines 7.875% 03/15/08 47 Northwest Airlines 8.700% 03/15/07 47 Northwest Airlines 8.875% 06/01/06 46 Northwest Airlines 9.179% 04/01/10 22 Northwest Airlines 9.875% 03/15/07 49 Northwest Airlines 10.000% 02/01/09 48 Northwest Stl&Wir 9.500% 06/15/01 0 NTK Holdings Inc 10.750% 03/01/14 69 NWA Trust 11.300% 12/21/12 72 Oakwood Homes 8.125% 03/01/09 7 Oscient Pharm 3.500% 04/15/11 69 Osu-Dflt10/05 13.375% 10/15/09 0 Outboard Marine 7.000% 07/01/02 0 Outboard Marine 10.750% 06/01/08 4 Overstock.com 3.750% 12/01/11 73 Owens Corning 7.000% 03/15/09 59 Owens Corning 7.500% 05/01/05 59 Owens Corning 7.500% 08/01/18 58 Owens Corning 7.700% 05/01/08 59 Owens-Corning Fiber 9.375% 06/01/12 75 PCA LLC/PCA Fin 11.875% 08/01/09 21 Pegasus Satellite 9.625% 10/15/49 11 Pegasus Satellite 9.750% 12/01/06 12 Pegasus Satellite 12.375% 08/01/06 9 Pegasus Satellite 12.500% 08/01/07 12 Piedmont Aviat 10.250% 01/15/49 1 Pixelworks Inc 1.750% 05/15/24 70 Pliant Corp 13.000% 06/01/10 43 Pliant Corp 13.000% 06/01/10 45 Polaroid Corp. 6.750% 01/15/02 0 Polaroid Corp. 7.250% 01/15/07 0 Polaroid Corp. 11.500% 02/15/06 0 Primus Telecom 3.750% 09/15/10 50 Primus Telecom 8.000% 01/15/14 61 Primus Telecom 12.750% 10/15/09 73 PSINET Inc 10.500% 12/01/06 0 Radnor Holdings 11.000% 03/15/10 32 Railworks Corp 11.500% 04/15/09 0 Read-Rite Corp. 6.500% 09/01/04 18 RJ Tower Corp. 12.000% 06/01/13 53 Rotech Healthcare 9.500% 04/01/12 64 Salton Inc 12.250% 04/15/08 74 Startec Global 12.000% 05/15/08 0 Tekni-Plex Inc. 12.750% 06/15/10 70 Tom's Foods Inc 10.500% 11/01/04 9 Toys R Us 7.375% 10/15/18 70 Tribune Co 2.000% 05/15/29 65 Triton Pcs Inc. 8.750% 11/15/11 74 Triton Pcs Inc. 9.375% 02/01/11 73 Twin Labs Inc. 10.250% 05/15/06 2 United Air Lines 7.270% 01/30/13 56 United Air Lines 7.870% 01/30/19 54 United Air Lines 9.020% 04/19/12 58 United Air Lines 9.350% 04/07/16 30 United Air Lines 9.560% 10/19/18 58 United Air Lines 10.020% 03/22/14 45 United Air Lines 10.125% 03/22/15 50 United Homes Inc 11.000% 03/15/05 0 US Air Inc. 10.250% 01/15/49 5 US Air Inc. 10.250% 01/15/49 11 US Air Inc. 10.300% 07/15/49 6 US Air Inc. 10.550% 01/15/49 45 US Air Inc. 10.680% 06/27/08 2 US Air Inc. 10.700% 01/01/49 22 US Air Inc. 10.700% 01/15/49 23 US Air Inc. 10.700% 01/15/49 44 US Air Inc. 10.700% 01/15/49 45 US Air Inc. 10.700% 01/15/49 45 US Air Inc. 10.700% 01/15/49 45 US Air Inc. 10.750% 01/01/49 0 US Air Inc. 10.750% 01/15/49 25 US Leasing Intl 6.000% 09/06/11 75 Venture Holdings 9.500% 07/01/05 1 Venture Holdings 11.000% 06/01/07 1 Vesta Insurance Group 8.750% 07/15/25 15 Werner Holdings 10.000% 11/15/07 28 Westpoint Steven 7.875% 06/15/05 0 Westpoint Steven 7.875% 06/15/08 0 Wheeling-Pitt St 6.000% 08/01/10 69 Winsloew Furniture 12.750% 08/15/07 26 Winstar Comm 14.000% 10/15/05 0 World Access Inc. 13.250% 01/15/08 4 Xerox Corp. 0.570% 04/21/18 34 Ziff Davis Media 12.000% 07/15/10 40 ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers' public debt and equity securities about which we report. Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than $3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. A list of Meetings, Conferences and Seminars appears in each Wednesday's edition of the TCR. Submissions about insolvency- related conferences are encouraged. Send announcements to conferences@bankrupt.com/ On Thursdays, the TCR delivers a list of recently filed chapter 11 cases involving less than $1,000,000 in assets and liabilities delivered to nation's bankruptcy courts. The list includes links to freely downloadable images of these small-dollar petitions in Acrobat PDF format. Each Friday's edition of the TCR includes a review about a book of interest to troubled company professionals. All titles are available at your local bookstore or through Amazon.com. Go to http://www.bankrupt.com/books/to order any title today. Monthly Operating Reports are summarized in every Saturday edition of the TCR. For copies of court documents filed in the District of Delaware, please contact Vito at Parcels, Inc., at 302-658-9911. For bankruptcy documents filed in cases pending outside the District of Delaware, contact Ken Troubh at Nationwide Research & Consulting at 207/791-2852. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter is a daily newsletter co-published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland, USA. Marie Therese V. Profetana, Robert Max Victor M. Quiblat II, Shimero R. Jainga, Joel Anthony G. Lopez, Emi Rose S.R. Parcon, Rizande B. Delos Santos, Cherry A. Soriano-Baaclo, Christian Q. Salta, Jason A. Nieva, Lucilo M. Pinili, Jr., Tara Marie A. Martin and Peter A. Chapman, Editors. Copyright 2006. 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 $725 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 ***