/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/070823.mbx T R O U B L E D C O M P A N Y R E P O R T E R Thursday, August 23, 2007, Vol. 11, No. 199 Headlines 155 EAST: Weak Operating Results Cue S&P to Junk Credit Rating ACTION A/C: Case Summary and 19 Largest Unsecured Creditors AGILYSYS INC: Commences "Dutch Auction" Offer for 6 Million Shares AIRPLANES PASS-THROUGH: S&P Junks Rating on Class A-9 Notes ALERIS INT'L: $600 Mil. Exchange Offer of Sr. Notes Expires Today AMBROSE MCMURPHY: Case Summary & 11 Largest Unsecured Creditors ASAT HOLDINGS: Obtains Nasdaq Notice on Below Criteria Securities ATARI INC: Non-Filing of Quarterly Report Cues Delisting Notice AUSTRALIAN FOREST: June 30 Balance Sheet Upside-Down by $11.7 Mil. BALLY TOTAL: Landlords Balk at Amended $292,000,000 DIP Pact BANC OF AMERICA: Fitch Holds "B-" Rating on $4.8MM Class O Certs. BANC OF AMERICA: Fitch Affirms Low-B Ratings on Four Classes BEAR STEARNS: Fitch Holds B- Rating on $3.1 Million Class P Certs. BEAZER HOMES: Files Suit Against Senior Notes' Trustee C AND C PROPERTIES: Has Until Sept. 23 to File Chapter 11 Plan CAPITAL ONE: Halted Loan Operations Cue Moody's to Hold Ratings CAPITAL ONE: Closed Operations Won't Affect Ratings, Fitch Says CATHOLIC CHURCH: Court Denies J. Ryan as San Diego's Advisor CATHOLIC CHURCH: Howrey LLP Okayed as San Diego's Special Counsel CCS MEDICAL: S&P Holds B- Credit Rating and Removes Positive Watch CELSIA TECH: Appoints Joseph Formichelli as CEO Effective Aug. 20 CEPHALON INC: Lack of Investor Interest Cues S&P to Remove Ratings COMM 2005-FL11: Fitch Holds Low-B Ratings on Three Cert. Classes CORNERSTONE-CAMERON: Case Summary and 20 Largest Unsec. Creditors COUNTRYWIDE FINANCIAL: Provides Reassurance to Customers CREDIT SUISSE: Fitch Junks Two Distressed Recovery Ratings CYTOCORE INC: Posts $1 Million Net Loss in Quarter Ended June 30 DLJ COMMERCIAL: Fitch Holds B- Rating on $8.9MM Class B-8 Certs. DUFF WAPINSKI: Case Summary & Largest Unsecured Creditor DURA AUTOMOTIVE: Pacificor Backstop Rights Pact Gets Court Okay DURA AUTO: Summary of Terms of Proposed Stockholders' Agreement EARTHFIRST TECH: Inks Orion Tie-Up to Build New Tire Facilty EARTHFIRST TECH: June 30 Balance Sheet Upside-Down by $3.4 Million EAST VALLEY: S&P Rates $153 Mil. Senior Secured Facility at B+ EDWIN MOLINA: Case Summary & 19 Largest Unsecured Creditors ELEPHANT TALK: June 30 Balance Sheet Upside-Down by $6.6 Million ENHANCED MORTGAGE: Fitch Junks Rating on $30MM Class B Jr. Notes ENHANCED MORTGAGE: Fitch Puts B- Shares Rating Under Neg. Watch FIDELITY NATIONAL: S&P Affirms BB+ Rating on Preferred Stock FINDEX.COM INC: Posts $343,500 Net Loss in Quarter Ended June 30 FULTON STREET: Poor Credit Quality Cues Fitch to Lower Ratings GLOBAL ENTERTAINMENT: Posts $812,176 Net Loss in Second Quarter GLOBAL HOME: Wants Until October 9 to File Chapter 11 Plan GLOBAL HOME: Committee Objects to Exclusivity Extension Plea HELEN WILLIAMS: Case Summary & Six Largest Unsecured Creditors HOLLINGER INC: Bondholders Want Investment Protected ICON HEALTH: Moody's Withdraws "Caa1" Corporate Family Rating INDYMAC BANCORP: Fitch Places Ratings Under Negative Watch INTERSTATE BAKERIES: NCSISA Wants Compensation Liabilities Paid INYX USA: Court Approves Klehr Harrison as Committee's Counsel JP MORGAN: Fitch Affirms Low-B Ratings on Five Cert. Classes JR & AR: Involuntary Chapter 11 Case Summary KENNETH CROSBY: Voluntary Chapter 11 Case Summary KINGSLAND GROUP: Involuntary Chapter 11 Case Summary LANDAMERICA FINANCIAL: S&P Holds BB+ Rating on Subordinated Debt M/I HOMES: Weak Market Cues S&P to Lower Credit Rating to BB- MARCO GUTIERREZ: Case Summary & 19 Largest Unsecured Creditors MAYWOOD CONSOLIDATED: Court Sets Sept. 28 Claims Filing Deadline MEDICAL SOLUTIONS: June 30 Balance Sheet Upside-Down by $2.2 Mil. MEDICOR LTD: Court Okays Greenberg Traurig as Delaware Counsel MERRILL LYNCH: Stable Performance Cues Fitch to Affirm Ratings MILA INC: Judge Steiner Okays Crocker Kuno as Committee's Counsel MUSICLAND HOLDING: Bank Wants Vendors Rule 2019 Statement Filed MUSICLAND HOLDING: LSTA & SIFMA Denounce Wachovia's 2019 Motion NATIONAL BANK: Moody's Affirms "B-" Financial Strength Rating NEW RIVER: Disclosure Statement & Plan Hearing Set for October 1 NEW YORK RACING: Bankruptcy May Continue Until Mid-2008 NOMURA ASSET: Fitch Affirms Low-B Ratings on Two Cert. Classes NOVASTAR ABS: Fitch Cuts Rating on $15.7MM Class D Notes to "BB" OPTIGENEX INC: Posts $740,262 Net Loss in Quarter Ended June 30 ORION 2006-1: Fitch Cuts Rating on $32.5MM Class D Notes to "B+" OSCAR HAMILTON: Case Summary & 19 Largest Unsecured Creditors PACIFIC LUMBER: Scopac Wants Diamond McCarthy as Co-Counsel PACIFIC LUMBER: Gets Open Ended Deadline to Decide on Five Lease PARADIGM MEDICAL: June 30 Balance Sheet Upside-Down by $2.6 Mil. PARMALAT SPA: Sells Spanish Operations to Lacteos Siglo PARMALAT SPA: Boschi Food & Beverage Acquires Business Assets POPULAR INC: Paying $0.16/Share Dividend on October 1 PRC LLC: Moody's Downgrades Corporate Family Rating to B3 QUAKER FABRIC: Organizational Meeting Scheduled on August 28 QUALITY HOME: Case Summary & 79 Largest Unsecured Creditors RANCHER'S BEEF: Files for Bankruptcy; Lays Off Workers RESIDENTIAL CAPITAL: Market Disruption Cues Fitch to Cut Rating REUNION INDUSTRIES: June 30 Balance Sheet Upside-Down by $23 Mil. RINKER BOAT: Moody's Junks Corporate Family Rating ROCKLAND VENDING: Case Summary and 21 Largest Unsecured Creditors SENTINEL MANAGEMENT: Gets Court OK to Disburse Asset Sale Proceeds SMALL WORLD: Has Until September 14 to File Schedules & Statement SOLUTIA INC: Wants Court Approval on Chemical Plant Agreement SOLUTIA INC: Inquip Associates Wants Adequate Protection SPECTRUM BRANDS: Appoints John D. Bowlin as Board Chairman STANDARD MOTOR: Board OKs $3.3MM Stock Repurchase Program Add On STANLEY-MARTIN: S&P Affirms B+ Corporate Credit Rating TELENET GROUP: Moody's Affirms B1 Corporate Family Rating TOLL BROTHERS: S&P Holds "BB+" Rating on $350 Mil. Senior Notes TRIBUNE CO: Shareholders Okay Going-Private Transaction UNITY WIRELESS: Posts $3.3 Million Net Loss in Qtr. Ended June 30 US AIRWAYS: Court Okays Stipulation with United on Code Share Pact US TELEPACIFIC: S&P Holds 'B-' Rating and Revises Outlook to Pos. WHEELING-PITTSBURGH: Secures $350 Mil. Revolving Credit Facility WORLDSPAN LP: Completes $1.4 Billion Sale Deal with Travelport WR GRACE: PI Committee Wants Charter Oak as Financial Advisor YRC WORLDWIDE: Stephen Bruffett Replaces Don Barger as EVP & CFO * Business Bankruptcy Rates Continue to Rise in 2007 * Donlin Recano to Provide Puig Inc. Chapter 11 Bankruptcy News * Mark Redmiles Appointed as EOUST's Deputy Director * Chapter 11 Cases with Assets & Liabilities Below $1,000,000 ********* 155 EAST: Weak Operating Results Cue S&P to Junk Credit Rating -------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on Las Vegas, Nevada-based 155 East Tropicana LLC. The corporate credit rating was lowered to 'CCC+' from 'B-'. The ratings remain on CreditWatch with developing implications, as the potential for a sale of the company remains. "The rating downgrade follows a continuation of weak operating results and our concern that the company will be challenged to meet its obligations if the acquisition by Hedwigs Las Vegas Top Tier LLC fails to close," explained Standard & Poor's credit analyst Guido DeAscanis. During the 12 months ended June 30, 2007, the company generated EBITDA of less than $8 million. As a result, EBITDA coverage of interest expense is below 1x. 155 East Tropicana owns the Hooters Casino Hotel, located on the site of the former Hotel San Remo, which is one-half block from the intersection of Tropicana Avenue and Las Vegas Boulevard, behind the Tropicana Resort & Casino and across from the MGM Grand Hotel & Casino. Following the substantial completion of an approximately $65 million renovation and re-branding, the property opened under the Hooters name on Feb. 2, 2006. While the company successfully met its April 1, 2007 interest payment of $5.7 million on its $130 million senior secured notes due 2012, continued weak operating performance will likely make the near-term time horizon more challenging. At June 30, 2007, 155 East Tropicana had roughly $12 million of availability under its $15 million revolving credit facility due 2009. The next $5.7 million interest payment on its senior secured notes is due on Oct. 1, 2007, and S&P expect this obligation to be met through a combination of internally generated cash and additional borrowings under the revolver. Furthermore, without meaningful growth in cash flow generation, liquidity will likely become constrained as the company continues to rely on debt financing to meet its near- term debt service and capital spending needs. The developing CreditWatch implications suggest that ratings could be affected either positively or negatively, depending on whether a transaction ultimately occurs. In resolving the CreditWatch listing, S&P will continue to monitor developments associated with a potential acquisition of the company. Should 155 East Tropicana's outstanding notes be fully redeemed, S&P would expect to withdraw its ratings on the company. However, in the event that the acquisition does not occur, the ratings could be lowered given heightened concerns about the company's ability to meet its obligations. ACTION A/C: Case Summary and 19 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Action A/C & Heat, Inc. 1688 Southeast Village Green Drive Port St. Lucie, FL 34952 Bankruptcy Case Number: 07-16656 Chapter 11 Petition Date: August 20, 2007 Court: Southern District of Florida (West Palm Beach) Judge: Paul G. Hyman, Jr. Debtor's Counsel: Julianne R. Frank, Esq. 11382 Prosperity Farms Road, Suite 230 Palm Beach Gardens, FL 33410 Tel: (561) 626-4700 Fax: (561) 627-9479 Total Assets: $243,258 Total Debts: $1,268,030 Debtor's 19 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Gemaire Distributors, L.L.C. secured bank loan $212,220 2151 West Hillsboro Boulevard, Suite 400 Deerfield, FL 33442 Pioneer Metals, Inc. wholesale distributor $170,229 P.O. Box 201347 Houston, TX 77216-1347 Lennox wholesale distributor $95,513 4P.O. Box 910549 Dallas, TX 75391-0549 Carrier Florida wholesale distributor $87,927 Suntrust Bank secured bank loan; $73,664 Richmond, VA value of collateral: $65,695 Suntrust Bank secured bank loan; $70,350 value of collateral: $74,227 Trane Equipment wholesale distributor $64,922 Bond Supply wholesale distributor $39,994 Refricenter wholesale distributor $39,943 Noland Company wholesale distributor $36,421 Johnstone Supply wholesale distributor $17,875 Trane Parts wholesale distributor $14,608 Exxon Fleet Services revolving credit card $12,648 Ford Credit secured bank loan; $28,004 value of collateral: $19,860 Suntrust Bank revolving credit card $7,078 Baltimore, MD Blue Cross Blue Shield of health insurance $6,541 Florida William H. Britton, Jr. insider loan to $6,000 business Baker Brothers wholesale distributor $5,175 @Road G.P.S. tracking $5,039 service AGILYSYS INC: Commences "Dutch Auction" Offer for 6 Million Shares ------------------------------------------------------------------ Agilysys Inc. has initiated a "Dutch Auction" tender offer, for up to 6,000,000 Agilysys common shares at a price not less than $16.25 nor greater than $18.50 per share, to the seller in cash, less any applicable withholding taxes and without interest. The closing price of the shares on Aug. 20, 2007, was $15.63 per share. The tender offer will expire at 5:00 pm EDT Wednesday, Sept. 19, 2007, unless extended. The "Dutch Auction" tender offer will allow shareholders to indicate how many shares and at what price within the company's specified range they wish to tender. Based on the number of shares tendered and the price specified by the tendering shareholders, the company will determine the lowest price per share within the range that will enable it to purchase up to 6,000,000 shares, or such lesser number of shares as are properly tendered. The company will not purchase shares below a price stipulated by a shareholder, and in some cases, may actually purchase shares at prices above a shareholder's indication under the terms of the "Dutch Auction." The company intends to repurchase tendered shares using cash on hand. Prior to initiating the tender offer, Agilysys had approximately $250 million of cash on hand and no outstanding debt. If the tender offer is consummated in full at $18.50 per share, the company estimates that it will have approximately $150 million cash on hand and $200 million available for borrowings under its credit facility following the tender offer. Agilysys is confident that the combination of existing cash on hand and the current credit facility provides sufficient financial flexibility to fund both the tender offer and the company's acquisition strategy. In connection with the board of directors' approval of the tender offer, the board also authorized the company to repurchase up to an additional 2,000,000 shares in the open market at an $18.50, price per share at or below the upper price limit of the tender offer, during the one-year period after the expiration of the tender offer, provided that the aggregate purchase price of shares purchased by the company in the tender offer and the open market repurchase does not exceed $150 million. The board determined that authorization of the open market repurchase program affords the company additional flexibility and is in the best interest of the company and its shareholders. The company also intends to continue to pay its $0.03 per share quarterly, or $0.12 per share annual, dividend to shareholders. The timing of the share repurchase and the number of shares to be repurchased will be at the discretion of the company's management, and will depend upon prevailing market conditions and other factors. Due to Securities and Exchange Commission (SEC) rules, the commencement, of the open market repurchase program may not begin until at least 10 days after the termination of the tender offer. The company may terminate or limit the repurchase program at any time. Due to certain financial covenants contained in the company's credit facility, which would likely limit the company's ability to repurchase the full 2,000,000 shares authorized under the repurchase program, the company is seeking an amendment to its credit facility in order to eliminate such limitations. On Jan. 2, 2007, Agilysys disclosed the divestiture of its KeyLink Systems Distribution Business to focus on its IT solutions business. At the same time, the company's board authorized the repurchase of up to 6,000,000 common shares, representing approximately 19% of the company's outstanding common shares, via a self-tender offer as soon as practicable following the close of the sale of KeyLink Systems. The tender offer provides an opportunity for those shareholders who -- based on the changes in the company's strategy -- would like to liquidate all or a portion of their investment in the stock in an orderly fashion. It also provides Agilysys with a tax-efficient mechanism to distribute a portion of the proceeds from the sale of KeyLink Systems to shareholders. Agilysys management and directors have indicated that they will not tender their shares in the tender offer. "The self-tender and supplementary open market authorization is a strong signal from our board and management that we are confident in our strategy to reposition the company and focus on selling IT solutions," Arthur Rhein, chairman, president and chief executive officer, said. "Tendering shareholders will receive an immediate premium to the stock's closing price of $15.63 on August 20, as it stood prior to the tender, and non-tendering shareholders, along with management and directors, will increase their pro rata ownership in the company and our future operations." J.P. Morgan Securities Inc. is acting as the dealer manager for the tender offer. The information agent is Georgeson Inc. and the depositary is National City Bank. The offer to purchase, letter of transmittal and related documents will be mailed to shareholders of record and will also be made available for distribution to beneficial owners of the company's shares. About Agilysys Inc. Headquartered in Mayfield Heights, Ohio, Agilysys Inc. (Nasdaq: AGYS) -- http://www.agilysys.com/-- is one of the distributors and resellers of enterprise computer technology solutions. The company is delivering complex server and storage hardware, software and services to resellers, large and medium-sized corporate customers, well as public-sector clients across a diverse set of industries. In addition, the company provides customer-centric software applications and services focused on the retail and hospitality markets. Agilysys has sales offices throughout the United States and Canada. * * * Standard and Poor's placed Agilysys Inc.'s long term foreign and local issuer credit ratings at "BB-" in October 2004. The ratings still hold to date. AIRPLANES PASS-THROUGH: S&P Junks Rating on Class A-9 Notes ----------------------------------------------------------- Standard & Poor's Ratings Services lowered its rating on the class A-8 notes from Airplanes Pass-Through Trust to 'BB-' from 'A'. At the same time, S&P lowered its rating on the class A-9 notes issued out of the same trust to 'CCC' from 'BB+' and removed it from CreditWatch, where it was placed with negative implications on May 1, 2007. The downgrades reflect the increased risk of obsolescence in the portfolio's aging fleet and higher re-leasing rate risk. High fuel prices and the increased availability of financing for new aircraft deliveries have meant that planes in the APTT portfolio have benefited to a lesser-than-expected degree from the global recovery in aircraft lease rates of the past several years. The collateral pool primarily consists of older aircraft assets that are likely to become economically obsolete earlier than originally anticipated. These planes are less fuel efficient than newer models, a disadvantage that has been substantially magnified by the surge in jet fuel prices since 2004. In addition, the increased availability of credit from operating lessors and other sources for start-up or smaller airlines, including those in developing countries, has allowed them to take delivery of new planes, rather than start out with used aircraft. This premature aging effect may cause future lease rates to decline and further depreciate the fleet value significantly, even in the current strong global aircraft lease market. Furthermore, some lessees have experienced periodic difficulties in meeting maintenance obligations, which has caused the trust to incur substantial maintenance expenses. These factors have reduced cash flows available to pay principal to the class A notes, and S&P believe this trend will continue going forward. Under the APTT priority of payments, the class A-8 notes are repaid before the class A-9 notes, and S&P believe it is unlikely that the class A-9 notes will be fully repaid by the legal final maturity. Standard & Poor's will monitor this transaction for further deterioration and will make additional rating changes as warranted. ALERIS INT'L: $600 Mil. Exchange Offer of Sr. Notes Expires Today ----------------------------------------------------------------- Aleris International Inc. has extended its offer to exchange up to $600 million aggregate principal amount of its 9%/93/4% Senior Notes due 2014, and up to $400 million aggregate principal amount of its 10% Senior Subordinated Notes due 2016 for an equal principal amount of 9%/93/4% Senior Notes due 2014 and 10% Senior Subordinated Notes due 2016, that have been registered under the Securities Act of 1933, as amended. The exchange offer is now scheduled to expire at 12:00 a.m., Eastern Time, today, Aug. 23, 2007, unless further extended by Aleris International Inc. As of 5:00 p.m., Eastern Time, on Aug. 21, 2007, approximately $599.9 million of the outstanding 9%/93/4% Senior Notes and approximately $400 million of the outstanding 10% Senior Subordinated Notes had been tendered in the exchange offer. Requests for a prospectus and a letter of transmittal in connection with the exchange offer for the 9%/93/4% Senior Notes due 2014 or the exchange offer for the 10% Senior Subordinated Notes due 2016 should be directed to the exchange agent, LaSalle Bank National Association, at (312) 904-5527. Headquartered in Beachwood, Ohio, Aleris International Inc. (NYSE: ARS) -- http://www.aleris.com/-- manufactures rolled aluminum products and offers 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 50 production facilities in North America, Europe, South America and Asia, and has approximately 8,500 employees. * * * Standard & Poor's assigned Aleris International Inc. a B+ senior secured first-lien term loan rating and gave the company a '2' recovery rating after the report that the company increased the term loan by $125 million. With the add-on, the total amount of the facility is now $1.23 billion. AMBROSE MCMURPHY: Case Summary & 11 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Ambrose Jeru McMurphy, III 101 Marsbury Lane Cary, NC 27519 Bankruptcy Case No.: 07-01807 Chapter 11 Petition Date: August 21, 2007 Court: Eastern District of North Carolina (Raleigh) Judge: A. Thomas Small Debtor's Counsel: William P. Janvier, Esq. Everett Gaskins Hancock & Stevens, LLP P.O. Box 911 Raleigh, NC 27602 Tel: (919) 755-0025 Fax: (919) 755-0009 Estimated Assets: $100,000 to $1 Million Estimated Debts: $1 Million to $100 Million Debtor's List of its 11 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Hancock Bank Home 2442 Westshore $945,000 2510 14th Street Drive, Biloxi, MS Gulfport, MS 39501 $161,000 Senior Lien: $945,000 Equity Services Home 2442 Westshore $200,000 5711 Six Forks Road Drive, Biloxi, MS Senior Lien: Suite 201 $1,106,000 Raleigh, NC 27609-3888 Bridges Investment Home 2442 Westshore $70,000 Company, Inc. Drive, Biloxi, MS Senior Lien: P.O. Box 16978 $1,306,000 Jackson, MS 39236 Toyota Financial Services $48,013 Lexus Financial Services $34,192 Citi Cards $15,961 Discover Card Services $6,597 Bancorp South Credit Card $4,383 Cross Country Bank $1,442 Home Depot Credit Services $1,003 Advanta Bank Corp. $521 ASAT HOLDINGS: Obtains Nasdaq Notice on Below Criteria Securities ----------------------------------------------------------------- ASAT Holdings Limited has received a letter from the Nasdaq Staff stating that the company's market value of listed securities has been below $35,000,000 as required for continued inclusion by Marketplace Rule 4320(e)(2)(B). Therefore, in accordance with Marketplace Rule 4320(e)(2)(D), the company will be provided 30 calendar days, or until Sept. 14, 2007, to regain compliance. If, at anytime before Sept. 14, 2007, the market value of listed securities of the company's ADSs is $35,000,000 or more for a minimum of 10 consecutive business days, Staff will determine if the company complies with this Rule. If compliance with this Rule cannot be demonstrated by Sept. 14, 2007, Staff will provide written notification that the company's securities will be delisted. At that time, the company may appeal Staff's determination to a Listing Qualifications Panel. The company was also notified by Nasdaq that it does not comply with the minimum stockholders' equity of $2,500,000 or net income from continuing operations of $500,000 in the completed fiscal year or in two of the last three most recently completed fiscal years, which are requirements for continued listing on the Nasdaq Capital Market. Headquartered in Pleasanton, California, ASAT Holdings Limited (Nasdaq: ASTT) -- http://www.asat.com/-- is a provider of semiconductor package design, assembly and test services. With 18 years of experience, the company offers a definitive selection of semiconductor packages and world-class manufacturing lines. ASAT's advanced package portfolio includes standard and high thermal performance ball grid arrays, leadless plastic chip carriers, thin array plastic packages, system-in-package and flip chip. ASAT was the first company to develop moisture sensitive level one capability on standard leaded products. The company has operations in the United States, Asia and Europe. * * * ASAT Holdings Limited's consolidated balance sheet at April 30, 2007, showed $135.1 million in total assets, $217.7 million in total liabilities, and $5.7 million in series A redeemable convertible preferred shares, resulting in a $88.3 million total stockholders' deficit. ATARI INC: Non-Filing of Quarterly Report Cues Delisting Notice --------------------------------------------------------------- Atari Inc. has received a Nasdaq Staff Determination stating that, because it did not file its Quarterly Report on Form 10-Q for the quarter ended June 30, 2007, within the prescribed time period, it is not in compliance with Marketplace Rule 4310(c)(14) and that such deficiency serves as an additional basis for delisting its securities from the Nasdaq Global Market. Receipt of the Determination does not result in immediate delisting of Atari's common stock. Atari has made a request for a hearing with The Nasdaq Listing Qualifications Panel to appeal the Nasdaq Staff's Determination on its delinquency in filing its Annual Report on Form 10-K and has a hearing date of Aug. 30, 2007. The Panel will consider both deficiencies at that time. The hearing request stayed any delisting pending the Panel's decision. Atari has not filed its Form 10-K because it is still determining what, accounting entries need to be made with respect to certain severance matters. Atari cannot determine its first quarter results until the prior year-end results are final. Atari will endeavor to make that determination as quickly as possible and therefore file its Form 10-K prior to the hearing date and its Form 10-Q promptly as possible thereafter. There can be no assurance the Panel will grant Atari's request for continued listing. About Atari Inc. Headquartered in New York City Atari, Inc. (Nasdaq: ATAR) -- http://www.atari.com/-- is a third-party publisher of interactive entertainment software in the U.S that develops interactive games for all platforms. The company's 1,000+ titles include franchises such as The Matrix(TM) (Enter The Matrix and The Matrix: Path of Neo), and Test Drive(R); and mass-market and children's franchises such as Nickelodeon's Blue's Clues(TM) and Dora the Explorer(TM), and Dragon Ball Z(R). Atari Inc. is a majority-owned subsidiary of France-based Infogrames Entertainment SA (Euronext - ISIN: FR-0000052573), an interactive games publisher in Europe. Going Concern Doubt Deloitte & Touche LLP expressed substantial doubt about Atari, Inc.'s ability to continue as a going concern after auditing the Company's financial statements for the for the fiscal years ended March 31, 2006 and 2005. The auditing firm pointed to Atari's significant operating losses and the expiration of its line of credit facility. AUSTRALIAN FOREST: June 30 Balance Sheet Upside-Down by $11.7 Mil. ------------------------------------------------------------------ Australina Forest Industries' consolidated balance sheet at June 30, 2007, showed $20.5 million in total assets and $32.2 million in total liabilities, resulting in an $11.7 million total stockholders' deficit. The company's consolidated balance sheet at June 30, 2007, also showed strained liquidity with $723,014 in total current assets available to pay $26.7 million in total current liabilities. The company reported a net loss of $1.8 million on sales of $1.4 million for the second quarter ended June 30, 2007, compared with a net loss of $609,068 on sales of $4.0 million for the same period ended June 30, 2006. Operating costs for the three-months ended June 30, 2007, aggregated $3.2 million. This includes costs incurred in general and administrative selling of $2.4 million. The company incurred an operating loss of $1.9 million for the quarter ended June 30, 2007, compared with an operationg loss of $732,755 for the same quarter in 2006. Net cash used in operating activities for the six-month period ended June 30, 2007, was $2.9 million. Net cash used in investing activities for the six-month period ended June 30, 2007, was $80,826. Net cash provided by financing activities was $5.0 million for this period. Full-text copies of the company's consolidated financial statements for the quarter ended June 30, 2007, are available for free at http://researcharchives.com/t/s?22d5 Going Concern Doubt Meyler & Company LLC, in Middletown, N.J., expressed substantial doubt about Australian Forest Industries' ability to continue as a going concern after auditing the company's consolidated financial statements as of the years ended Dec. 31, 2006, and 2005. The auditing frim pointed to the company's net loss of $6,232,558 in 2006, stockholders' deficit of $6,834,184 at Dec. 31, 2006, and existing uncertain conditions the company faces relative to its ability to obtain capital and operate successfully. The company incurred a net loss of $4.1 million for the six months ended June 30, 2007, and has a stockholders' deficit of $11.7 million at June 30, 2007. Additionally, during the fourth quarter, the company experienced a severe liquidity problem and was having difficulty obtaining logs to operate its businesses. Currently, management has entered into a processing contract with Weyerhaeuser to process their logs for which the company is receiving a processing fee. On March 24, 2007, the company terminated agreements with each of Simba Mines Inc., and Bongani International Group Limited due to the parties' failure to reach agreement on key terms. As a result of the termination, both the Stock Purchase Agreement and the Share Sale Agreement were mutually terminated by the parties thereto on March 24, 2007. About Australian Forest Headquartered in Port Melbourne, Victoria, Australia, Australian Forest Industries (OTC BB: AUFI.OB) fka. Multi-Tech International Corp. was originally incorporated in the State of Nevada on Sept. 21, 1998 under the name Oleramma Inc. The company operates a pine sawmilling and timber facility at Canberra, which has a capacity to process 200,000 cubic meters of log. This sawmill processed approximately 170,000 cubic meters of log during the year ended Dec. 31, 2006. BALLY TOTAL: Landlords Balk at Amended $292,000,000 DIP Pact ------------------------------------------------------------ Twenty-six landlords that are parties to unexpired leases of non-residential real property with Bally Total Fitness Holding Corporation and its debtor-affiliates, filed objections to the amended proposed debtor-in-possession financing agreement the Debtors entered into with Morgan Stanley Senior Funding Inc. As reported in the Troubled Company Reporter on Aug. 2, 2007, Morgan Stanley agreed to arrange a $292,000,000 DIP facility comprised of a $50,000,000 revolving facility and a $242,000,000 term loan facility, which was later amended. Under the amended DIP agreement, the DIP Lenders would provide the DIP Facility and Exit Facility to the Debtors regardless of whether the Debtors sought or obtained confirmation of their Original Plan or Modified Plan. The Debtors noted that the modifications do not materially alter the treatment of any class of claims or interests in the Plan. The Landlords objected to the Amended DIP Agreement to the extent that the Debtors pledge, grant a security interest or lien on, sell, assign or otherwise transfer the Debtors' interest in the Leases to the DIP Lenders. Most, if not all, of the Objecting Landlords' Leases are leases of premises located in shopping centers, and contain express language prohibiting the granting of liens in, the leasehold interest. Moreover, many of the Objecting Landlords' leases are encumbered by mortgages, which specifically prohibit the Landlord from allowing any encumbrances to be granted upon the various tenant Leases, which are themselves subject to the prior mortgage lien of the Landlords' lender. "Although it is not unusual for lenders to require liens on a debtor's real property leases, these liens are frequently limited to only the proceeds of the debtor's leasehold interests and do not extend to the leaseholds themselves," Kevin M. Newman, Esq., at Menter, Rudin & Trivelpiece PC, in Syracuse, New York, counsel for Objecting Landlord Inland Commercial Property Management, Inc., states. Under Section 365(f)(2) of the Bankruptcy Code, Mr. Newman says, a debtor cannot assign an unexpired lease of nonresidential real property without first proving that the proposed assignee can provide the landlord with adequate assurance of future performance. In the event the Debtors defaulted and the DIP Lenders foreclosed on the Leases, landlords could suffer a de facto assignment of the Leases to a new tenant, without adequate assurance of future performance as required by Section 365(f), contends Mr. Newman. Against this backdrop, the Objecting Landlords ask the Court to modify the description of "Collateral" in the Court's final DIP order, to provide that the Collateral does not include the Debtors' leasehold interests, only the proceeds from the sale, assignment or other disposition of the leasehold interests. The Objecting Landlords are: (1) Fairlane Town Center LLC, (2) Inland Commercial Property Management, Inc., (3) Inland U.S. Management LLC, (4) Centro Property Group, (5) Federal Realty Investment Trust, (6) SVF Kendall Miami LLC, (7) Prudential Insurance Company of America, (8) RREEF USA Funds, (9) Sywest Development, (10) West Valley Properties, Inc., (11) Commercial Realty Enterprises LLC, (12) James Campbell Company, (13) Blackhawk Centercal LLC, (14) Columbia Cascade Plaza LLC, (15) Regency Centers LP, (16) Leo P. Siklar, (17) Libby Siklar, (18) The Morris Rochlin Trust, (19) Westfield LLC, (20) Hawthorne LP, (21) Wheaton Plaza Regional Shopping Center LLP, (22) Simon Property Group, Inc., (23) High Definition Realty LLC, (24) Northlake Festival LLC, (25) Textron Financial Corporation, and (26) The Matton Group Ltd. Based in Chicago, Illinois, Bally Total Fitness Holding Corp. (Pink Sheets: BFTH.PK) -- http://www.ballyfitness.com/-- operates fitness centers in the U.S., with over 375 facilities located in 26 states, Mexico, Canada, Korea, China and the Caribbean under the Bally Total Fitness(R), Bally Sports Clubs(R) and Sports Clubs of Canada (R) brands. Bally Total and its affiliates filed for chapter 11 protection on July 31, 2007 (Bankr. S.D.N.Y. Case No. 07-12396) after obtaining requisite number of votes in favor of their pre-packaged chapter 11 plan. Joseph Furst, III, Esq. at Latham & Watkins, L.L.P. represents the Debtors in their restructuring efforts. As of June 30, 2007, the Debtors had $408,546,205 in total assets and $1,825,941,54627 in total liabilities. No schedule has been set to date for an organizational meeting that would create an Official Committee of Unsecured Creditors. The Court recently held that the meeting of creditors pursuant to Section 341(a) of the Bankruptcy Code will not be convened, and is canceled, if the Debtors' Plan of Reorganization is confirmed on or prior to October 16, 2007. (Bally Total Fitness Bankruptcy News, Issue No. 6; Bankruptcy Creditors' Services Inc. http://bankrupt.com/newsstand/or 215/945-7000). BANC OF AMERICA: Fitch Holds "B-" Rating on $4.8MM Class O Certs. ---------------------------------------------------------------- Fitch Ratings affirmed these classes of Banc of America Commercial Mortgage Corp., series 2004-6, commercial mortgage pass-through certificates: -- $9 million class A-1 at 'AAA'; -- $193.7 million class A-2 at 'AAA'; -- $220.8 million class A-3 at 'AAA'; -- $35.4 million class A-4 at 'AAA'; -- $35.6 million class A-AB at 'AAA'; -- $237.4 million class A-5 at 'AAA'; -- $56.2 million class A-J at 'AAA'; -- Interest-only class XC at 'AAA'; -- Interest-only class XP at 'AAA'; -- $19.1million class B at 'AA'; -- $9.6 million class C at 'AA-'; -- $17.9 million class D at 'A'; -- $9.6 million class E at 'A-'; -- $14.3 million class F at 'BBB+'; -- $9.6 million class G at 'BBB'; -- $13.1 million class H at 'BBB-'; -- $6.0 million class J at 'BB+'; -- $4.8 million class K at 'BB'; -- $4.8 million class L at 'BB-'; -- $3.6 million class M at 'B+'; -- $3.6 million class N at 'B'; -- $4.8 million class O at 'B-' Fitch does not rate the $14.3 million class P. The rating affirmations are the result of stable performance and minimal paydown since issuance. As of the August 2007 remittance report, the transaction has paid down 3.5% to $ 923.3 million from $956.6 million at issuance. There are currently no delinquent or specially serviced loans in this transaction. BANC OF AMERICA: Fitch Affirms Low-B Ratings on Four Classes ------------------------------------------------------------ Fitch affirmed Banc of America Commercial Mortgage Inc., Series 2006-3 as: -- $34.1 million class A-1 at 'AAA'; -- $43.5 million class A-2 at 'AAA'; -- $60 million class A-3 at 'AAA'; -- $1,010.7 million class A-4 at 'AAA'; -- $218.8 million class A-1A at 'AAA'; -- $196.5 million class A-M at 'AAA'; -- $152.3 million class A-J at 'AAA'; -- Interest-only class XW at 'AAA'; -- $41.8 million class B at 'AA'; -- $19.6 million class C at 'AA-'; -- $31.9 million class D at 'A'; -- $17.2 million class E at 'A-'; -- $22.1 million class F at 'BBB+'; -- $17.2 million class G at 'BBB'; -- $22.1 million class H at 'BBB-'; -- $12.3 million class J at 'BB+'; -- $7.4 million class K at 'BB'; -- $7.4 million class L at 'BB-'; -- $2.5 million class M at 'B+'. Fitch does not rate the $7.4 million class N, the $4.9 million class O, and the $27 million class P. The rating affirmations reflect stable performance and minimal paydown of the transaction since issuance. As of the August 2007 distribution date, the pool's aggregate certificate balance has decreased 0.4% to $1.957 billion from $1.965 billion at issuance. There have been no delinquent or specially serviced loans since issuance. At issuance, Fitch credit assessed the One Stamford Forum (5%) and FBI Regional Headquarters (4.5%) loans. Both loans continue to maintain their investment grade credit assessments based on stable performance and occupancy levels since issuance. BEAR STEARNS: Fitch Holds B- Rating on $3.1 Million Class P Certs. ------------------------------------------------------------------ Fitch Ratings has upgraded Bear Stearns Commercial Mortgage Securities Inc. commercial mortgage pass-through certificates, series 2004-PWR5, as: -- $29.3 million class B to 'AA+' from 'AA'; -- $9.3 million class C to 'AA' from 'AA-'; -- $20 million class D to 'A+' from 'A'; -- $13 million class E to 'A' from 'A-'. In addition, Fitch affirmed these classes: -- $40.5 million class A-1 at 'AAA'; -- $156 million class A-2 at 'AAA'; -- $134 million class A-3 at 'AAA'; -- $100 million class A-4 at 'AAA'; -- $579.1 million class A-5 at 'AAA'; -- Interest-only class X-1 at 'AAA'; -- Interest-only class X-2 at 'AAA'; -- $15.4 million class F at 'BBB+'; -- $9.3 million class G at 'BBB'; -- $18.5 million class H at 'BBB-'; -- $4.6 million class J at 'BB+'; -- $4.6 million class K at 'BB'; -- $6.2 million class L at 'BB-'; -- $4.6 million class M at 'B+'; -- $4.6 million class N at 'B'; -- $3.1 million class P at 'B-'. Fitch does not rate the $13.9 million class Q certificates. The upgrades reflect defeasance, pay down and stable pool performance since the last review. As of the August 2007 distribution date, the pool has paid down 5.8% to $1.16 billion from $1.23 billion at issuance. To date, five loans (15.6%) have been defeased. There have been no delinquent or specially serviced loans since issuance. Fitch reviewed the performance of the seven remaining credit assessments: Reisterstown Plaza (4.3%), World Apparel Center (3.2%), Fullerton Metrocenter (2.4%), New Castle Marketplace (1.2%), Palmetto Business Park (1.2%), Monticello Mall (1.1%) and New Hampshire Tower (0.9%). Based on their stable performance the loans maintain their investment grade credit assessments. Reisterstown Plaza is a 791,661 square foot mixed-use property consisting of retail and office space in Baltimore, MD. Anchor tenants include Home Depot and Burlington Coat Factory. The property benefits from the experienced sponsorship and management of Inland Western Retail Real Estate Trust, a subsidiary of Inland Group, Inc. Occupancy as of June 30, 2007, has increased to 97.5% from 97.1% at issuance. World Apparel Center is a 1.2 million sf office property located in Midtown Manhattan. Major tenants include Jones Apparel Group, Chase Manhattan and Levi Strauss. The property benefits from the experienced sponsorship of Trizec Properties, Inc., a publicly traded real estate investment trust. Occupancy as of Jan. 31, 2007 is 91% compared to 97.9% at issuance. BEAZER HOMES: Files Suit Against Senior Notes' Trustee ------------------------------------------------------ Beazer Homes USA Inc. disclosed in a regulatory filing with the U.S. Securities and Exchange Commission that on Aug. 21, 2007, it filed an action with the United States District Court in Atlanta, Georgia against U.S. Bank National Association, the trustee under the indentures governing the company's outstanding senior notes. As reported in the Troubled Company Reporter on Aug. 15, 2007, the company said that it will be unable to file its Form 10-Q for the period ended June 30, 2007, by the required deadline. The company disclosed that its Audit Committee is conducting an independent internal investigation of the company's mortgage origination business and related matters. To assist with the investigation, the Audit Committee retained independent legal counsel, who, in turn, retained independent forensic accountants. During the course of the investigation, the company discovered that its former Chief Accounting Officer may have caused reserves and other accrued liabilities, relating primarily to land development costs and costs to complete houses, to have been recorded in prior accounting periods in excess of amounts that would have been appropriate under generally accepted accounting principles. These reserves and other accrued liabilities, if reversed in subsequent accounting periods, could have been used to reduce the company's operating expenses by amounts that would not have been appropriate under generally accepted accounting principles. The company relates that it is seeking, among other relief, a declaration from the court against the trustee that the filing delay does not constitute a default under the applicable indentures and that the delay will not give rise to any right of acceleration on the part of the holders of the senior notes. The company said it has not received a notice of default under any of the indentures. A full-text copy of the complaint may be viewed for free at: http://ResearchArchives.com/t/s?22de About Beazer Homes Headquartered in Atlanta, Beazer Homes USA Inc., (NYSE: BZH) -- http://www.beazer.com/-- is one of the country's ten largest single-family homebuilders with operations in Arizona, California, Colorado, Delaware, Florida, Georgia, Indiana, Kentucky, Maryland, Mississippi, Nevada, New Jersey, New Mexico, New York, North Carolina, Ohio, Pennsylvania, South Carolina, Tennessee, Texas, Virginia and West Virginia and also provides mortgage origination and title services to its homebuyers. * * * As reported in the Troubled Company Reporter on Aug. 21, 2007, Standard & Poor's Ratings Services placed its 'BB-' corporate credit and senior unsecured debt ratings on Beazer Homes on CreditWatch with negative implications. The CreditWatch placements affect roughly $1.5 billion in rated debt securities and follow the company's recent announcement that its third- quarter 10-Q filing (due Aug. 14, 2007) will be delayed. As reported in the Troubled Company Reporter on Aug. 15, 2007, Moody's Investors Service placed all of the ratings of Beazer Homes under review for downgrade, including its Ba2 corporate family rating, Ba2 probability of default rating, and Ba2 (LGD-4, 53%) rating on its senior notes. This action followed the company's announcement that it would be unable to file its fiscal third quarter 10-Q statement in a timely fashion. At the same time, Fitch Ratings downgraded Beazer Homes' Issuer Default Rating to 'BB' from 'BB+' and simultaneously placed its ratings on Rating Watch Negative. C AND C PROPERTIES: Has Until Sept. 23 to File Chapter 11 Plan -------------------------------------------------------------- The Honorable Edward Ellington of the U.S. Bankruptcy Court for the Southern District of Mississippi extended C and C Properties Inc.'s exclusive period to file a Chapter 11 plan of reorganization and disclosure statement until Sept. 23, 2007, The Debtor's exclusive period to file a plan expired on July 23, 2007. The Debtor told the Court that it was not able to complete its proposed plan because of ongoing negotiations with various creditors. Jeffrey K. Tyree, Esq., at Harris Jernigan & Geno, PLLC, assured the Court that the Debtor's request for extension will not result in any undue prejudice to any of its creditors or other party-in- interest. Based in Union, Mississippi, C and C Properties, Inc. develops real estate properties. The company filed for Chapter 11 protection on January 24, 2007 (Bankr. S.D. Miss. Case No. 07-50082). Jeffery Kyle Tyree, Esq. and Melanie T. Vardaman, Esq., at Harris Jernigan & Geno, PPLC, represent the Debtor in its restructuring efforts. No Committee of Unsecured Creditors has been appointed in the Debtor's bankruptcy proceedings. In its schedules filed with the Court, the Debtor disclosed total assets of $12,500,000 and total debts of $10,016,965. CAPITAL ONE: Halted Loan Operations Cue Moody's to Hold Ratings --------------------------------------------------------------- Moody's Investors Service affirmed the ratings of Capital One Financial Corporation and subsidiaries following the company's announcement that it will cease residential mortgage origination operations at its GreenPoint Mortgage subsidiary. The outlook for all ratings remains stable. As part of the closure of the GreenPoint Mortgage subsidiary, Capital One will take an after-tax charge of about $860 million, of which $650 million is non-cash and related to goodwill. While Moody's finds the charge to earnings to be material, the overall impact on the company's tangible capital ratios is manageable. "The Capital One franchise generates considerable earnings from its multiple consumer credit and deposit businesses, which should allow the company's capital metrics to recover relatively quickly," said Moody's Vice President -- Senior Analyst, Curt Beaudouin. Moody's notes that the company's recent purchase of NetSpend, all cash purchase of about $700 million, and the charges discussed above will negatively affect the company's capital ratios in the near-term. In addition, Capital One retains exposure to GreenPoint's mortgage originations through its $2.6 billion held- for-sale portfolio. The majority of this portfolio is committed for sale under forward flow agreements and the company has built reserves for its remaining exposure. Moody's expects any additional valuation adjustments to this portfolio to be manageable. Moody's will continue to monitor the credit quality of Capital One's much larger held-for-investment mortgage portfolio ($12.5 billion), which is primarily comprised of first lien, agency conforming loans. Moody's will also closely monitor COF's capital generation and the replenishment of capital ratios that have been diminished by the mortgage related charge, the NetSpend acquisition, and share repurchase activity. Moody's expectation is that capital ratios will be returned to former levels promptly through the robust capital generation capability of the firm, noting that potential adjustment of the share repurchase program provides additional flexibility in this regard. Capital One's ratings are supported by its diversified revenue base, strong liquidity profile, and experienced management team. Ratings affirmed include these: Capital One Financial Corporation -- Senior UnsecuredA3 Capital One Bank -- Senior UnsecuredA2 -- Long Term DepositsA2 -- Bank Financial StrengthC+ Capital One Financial Corporation, headquartered in McLean, VA, is a bank holding company and the fourth largest U.S. bank credit card issuer. Capital One reported $199 billion in average managed assets (including securitized receivables) at June 30, 2007. CAPITAL ONE: Closed Operations Won't Affect Ratings, Fitch Says --------------------------------------------------------------- Fitch Ratings that Capital One's decision to shut-down mortgage origination operations at GreenPoint Mortgage will not have any near-term impact on COF's ratings. However, Fitch expects that the resolution of the Positive Rating Outlook will be extended beyond 12- to 18-months, in order to fully assess the impact of the North Fork acquisition and the GPM wind-down, as well as the affect market factors will have on credit quality at all business units. COF expects to record after-tax costs of $860 million associated with the closure of GPM in 2007, composed of $650 million in the write-down of goodwill, $100 million in restructuring charges, and $110 million in valuation adjustments related to ongoing operations. While Fitch understands capital ratios will be negatively impacted over the near-term, tangible capital is expected to remain relatively stable. The closure of GPM is not a positive rating factor, but Fitch appreciates management's decision was made in light of its ability to profitably operate in the Alt-A mortgage market over the long- term, given uncertain conditions in the secondary market. Additionally, while Fitch believes GPM has had a good presence in the mortgage market, they do not believe that COF's decision to purchase North Fork Bancorporation was motivated by the acquisition of the GPM subsidiary. Therefore, Fitch did not view GPM operations to be a core operating strength of the company. COF will continue to originate mortgages through non-broker channels at Capital One National Association and Capital One Home Loans. The Positive Rating Outlook continues to reflect benefits expected to be achieved from the company's product and funding diversification, as it integrates its largest acquisition to date. Fitch believes a smooth integration of North Fork combined with stable operating performance in all business segments could support rating momentum. Conversely, ratings could be constrained by significant integration issues, weakening credit quality beyond Fitch's expectations, and/or material deterioration in the U.K. card portfolio. CATHOLIC CHURCH: Court Denies J. Ryan as San Diego's Advisor ------------------------------------------------------------ R. Todd Neilson, the "expert witness" tasked to look into The Roman Catholic Bishop of San Diego's cash management system, delivered the results of his investigation in a 175-page report to the Hon. Louise DeCarl Adler of the U.S. Bankruptcy Court for the Southern District of California on July 30, 2007. The U.S. Bankruptcy Court for the Southern District of California has denied an application filed by The Roman Catholic Bishop of San Diego to engage John E. Ryan, a retired U.S. Bankruptcy judge, to act as an advisor and consultant to the Diocese. "This case already has a substantial number of professionals and former Judge Ryan's addition -- even pro bono -- will only increase costs to this estate by causing multiple conferences with yet another layer of participants," Judge Adler said. According to the Court, all matters on which former Judge Ryan is supposed to "consult" are matters which counsel for the Diocese or the Organization of Parishes are already performing. Prior to Judge Adler's ruling, the Diocese pleaded to the Court to allow it to engage Judge Ryan as its consultant, arguing that the consulting services to be provided are on a pro bono basis, without any fee or charge to the Diocese or the bankruptcy estate, other than reimbursement of ordinary and customary actual out-of- pocket expenses like car mileage, parking, and working lunches and dinners. The Diocese also agreed to hold Judge Ryan harmless from any claims or actions resulting from his performance as consultant, including costs and attorney's fees in defending any resulting litigation. Counsel for the Diocese, Gerald P. Kennedy, Esq., at Procopio, Cory, Hargreaves & Savitch LLP, in San Diego, California, told the Court that the consulting services, which include assisting the Diocese: (a) to understand and carry out its responsibilities as a Chapter 11 Debtor and the orders of the Court; (b) to present, negotiate, and achieve a fair consensual plan with its creditors; (c) in mediation and settlement discussions with the tort claimants to resolve important reorganization issues; (d) in communicating effectively with parishes regarding the reorganization process; and (e) in administrative matters pertaining to the reorganization process, were to be provided on an as needed basis, and only when Judge Ryan is available. The proposed services did not include Judge Ryan making Court appearances or advocating or arguing any position on behalf of the Diocese directly to the Court. The Official Committee of Unsecured Creditors objected to the application arguing that the it is premature in light of the impending expert report, and is unnecessary as the proposed services are redundant of those already provided by the Diocese's team of professionals. There is "something going on here besides the need for another consultant," the Committee stated in its opposition. The Diocese replied that the Committee's objection is based on speculation, is unwarranted and unfounded, and should, therefore, be disregarded by the Court in its entirety. About the San Diego Diocese The Roman Catholic Diocese of San Diego in California -- http://www.diocese-sdiego.org/-- employs approximately 3,000 people in various areas of work. The Diocese filed for Chapter 11 protection just before commencement of the first of court proceedings for 140 sexual abuse lawsuits filed against the Diocese. Authorities of the San Diego Diocese said they were not in favor of litigating their cases. The San Diego Diocese filed for chapter 11 protection on Feb. 27, 2007 (Bankr. S.D. Calif. Case No. 07-00939). Gerald P. Kennedy, Esq., at Procopio, Cory, Hargreaves and Savitch LLP, represents the Diocese. In its schedules of assets and liabilities, the Diocese listed total assets of $152,510,888 and total liabilities of $72,754,092. On March 27, 2007, the Debtor filed its plan and disclosure statement. (Catholic Church Bankruptcy News, Issue No. 99; Bankruptcy Creditors' Service Inc. http://bankrupt.com/newsstand/or 215/945-7000). CATHOLIC CHURCH: Howrey LLP Okayed as San Diego's Special Counsel ----------------------------------------------------------------- The Roman Catholic Bishop of San Diego obtained permission from the U.S. Bankruptcy Court for the Southern District of California to employ Howrey LLP as its special counsel regarding complex insurance coverage matters, nunc pro tunc to July 1, 2007. Msgr. Steven Callahan, the Diocese's vicar general, relates that Howrey LLP has the experience and expertise necessary to provide San Diego representation in the complex insurance coverage issues the Diocese faces. Since the Diocese holds certain insurance policies that provide coverage with respect to clergy abuse claims, it is important for the Diocese to have expert counsel to analyze the Claims as they relate to the insurance coverage. Msgr. Callahan tells the Court that the Diocese wants to employ Howrey LLP and the firm's Patrick J. McDonough, Esq., in particular, because both have been previously employed by the Diocese. Because of the firm's and Mr. McDonough's familiarity with the Diocese's coverage issues, it is most economical to hire them, Msgr. Callahan says. Howrey LLP will be paid previously negotiated rates on hourly basis: Patrick J. McDonough $480 Stephen V. Masterson $470 Douglas W. Gastelum $395 Paralegals $160 to $210 Financial Analysts $130 to $290 The estimated quarterly fees of Howrey LLP is approximately $30,000 for the period from July 1, 2007, through September 30, 2007, Msgr. Callahan says. Howrey LLP will also be paid reimbursement of reasonable and necessary expenses incurred in connection with its representation of the Diocese. Mr. McDonough assures the Court that Howrey LLP does not hold or represent any interest materially adverse to the interest of the bankruptcy estate with respect to insurance coverage matters. About the San Diego Diocese The Roman Catholic Diocese of San Diego in California -- http://www.diocese-sdiego.org/-- employs approximately 3,000 people in various areas of work. The Diocese filed for Chapter 11 protection just before commencement of the first of court proceedings for 140 sexual abuse lawsuits filed against the Diocese. Authorities of the San Diego Diocese said they were not in favor of litigating their cases. The San Diego Diocese filed for chapter 11 protection on Feb. 27, 2007 (Bankr. S.D. Calif. Case No. 07-00939). Gerald P. Kennedy, Esq., at Procopio, Cory, Hargreaves and Savitch LLP, represents the Diocese. In its schedules of assets and liabilities, the Diocese listed total assets of $152,510,888 and total liabilities of $72,754,092. On March 27, 2007, the Debtor filed its plan and disclosure statement. (Catholic Church Bankruptcy News, Issue No. 99; Bankruptcy Creditors' Service Inc. http://bankrupt.com/newsstand/or 215/945-7000). CCS MEDICAL: S&P Holds B- Credit Rating and Removes Positive Watch ------------------------------------------------------------------ Standard & Poor's Rating Services affirmed its 'B-'corporate credit rating on diabetes and chronic care mail-order supplier CCS Medical Inc. In addition, the ratings were removed from CreditWatch, where they were placed with positive implications on May 16, 2007. The outlook is positive. At the same time, Standard & Poor's changed its bank loan ratings on CCS' aggregate $480 million bank financing. Ratings on the $370 million first-lien facilities, consisting of a $50 million revolving credit facility and a $320 million term loan, are raised to 'B+' from 'B-', two notches above the corporate credit rating on CCS, while the recovery rating is changed to '1' from '2', indicating expectations of very high recovery (90%-100%) in the event of a payment default. The $110 million second-lien term loan remains unchanged at 'CCC', two notches below the corporate credit rating on CCS, with a recovery rating of '6', indicating expectations of negligible recovery (0%-10%) in the event of a payment default. The rating action reflects the delay of the Clearwater, Florida- based company's planned $172 million initial public offering, which was expected to be a significant deleveraging event for the company. While the delayed IPO removes the prospect of an immediate reduction of debt, some concern has been alleviated as a result of demonstrated improvements in accounts receivables collections and operating momentum through the first half of 2007. "If the company sustains current momentum while generating further room relative to its financial covenants, or if the company's IPO plans are revived and completed, we could raise the rating," said Standard & Poor's credit analyst Alain Pelanne. CELSIA TECH: Appoints Joseph Formichelli as CEO Effective Aug. 20 ----------------------------------------------------------------- Celsia Technologies has named Joseph Formichelli as the new CEO effective Aug. 20. Mr. Formichelli was appointed by Celisa's board of directors. "Joseph brings to Celsia a proven history of focusing and executing on strategic and tactical programs while improving shareholder value," George Meyer, vice president, Americas and Europe, Celsia Technologies, said. "His leadership skills and extensive industry background will be a great asset to the company. As CEO, Joseph will strengthen Celsia Technologies' position in the electronics cooling market and help guide the company to the next level." "Joe's business acumen combined with his industry savvy and operational background, make him an excellent fit for the Celsia CEO position," Greg Osborn, managing director at Middlebury Securities and Celsia board member, added. "I look forward to Joe leveraging his more than 30 years of technology management and product globalization to drive the commercialization of Celsia's products." During his career, Mr. Formichelli has held senior executive positions in manufacturing, quality assurance, engineering, logistics, supply chain and product management. At IBM, he served as vice president of operations for the IBM PC company and as vice president and general manager responsible for the ThinkPad line of notebook computers. He served as the executive vice president and general manager of Toshiba's computer systems group, where he oversaw the U.S., Latin America, and South America business. During this period, Mr. Formichelli converted Toshiba's computer business from a technology-driven indirect sales organization to one of e-business, customer relations management and direct sales, while revamping its manufacturing operations. "Cooling is one of the single most critical factors in current and emerging electronic designs," Mr. Formichelli, said. "Celsia is meeting the challenge with its innovative NanoSpreader(TM) microfluidic cooling technology, and I look forward to leading the company to further success." Mr. Formichelli replaces Hakan Wretsell as CEO. Celsia Technologies' board also appointed Jorge Fernandez, corporate controller as acting CFO, replacing Michael Karpheden, who has resigned to pursue a career with Business Growth Consultants Inc. About Celsia Technologies Headquartered in Miami, Florida, Celsia Technologies Inc. (OTC BB: CSAT) -- http://www.celsiatechnologies.com/-- is a full solution provider and licensor of thermal management products and technology for the PC, consumer electronics, lighting and display industries. The company is developing and commercializing next-generation cooling solutions built on patented micro thermofluidic technology. Celsia Technologies' extensive intellectual property portfolio includes patents registered in Korea, the U.S., Japan and Taiwan, with patents pending in the EU, Russia, India and in China. Going Concern Doubt PKF, in New York, expressed substantial doubt about Celsia Technologies Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements for the years ended Dec. 31, 2006, and 2005. The auditing firm reported that at Dec. 31, 2006, the company and its subsidiaries have commenced limited revenue producing operations and have an accumulated deficit of $23.7 million. CEPHALON INC: Lack of Investor Interest Cues S&P to Remove Ratings ------------------------------------------------------------------ Standard & Poor's Ratings Services withdrew the ratings on Cephalon Inc. due to lack of investor interest. COMM 2005-FL11: Fitch Holds Low-B Ratings on Three Cert. Classes ---------------------------------------------------------------- Fitch Ratings has upgraded these classes of COMM 2005-FL11 commercial mortgage pass-through certificates: -- $33.3 million class E to 'AAA' from 'AA+'; -- $30.3 million class F to 'AA+' from 'AA'. These classes are affirmed: -- $118.6 million class A-1 at 'AAA'; -- $320.0 million class A-J at 'AAA'; -- $33.3 million class B at 'AAA'; -- $37.8 million class C at 'AAA'; -- $25.7 million class D at 'AAA'; -- $25.7 million class G at 'AA'; -- $22.7 million class H at 'A+'; -- $25.7 million class J at 'A-'; -- $27.2 million class K at 'BBB'; -- $22.7 million class L at 'BBB-'; -- Interest Only classes X-1, X-2-CB, X-2-DB, X-2-SG, X-3-CB, X-3-DB, and X-3-SG at 'AAA'. Classes M-SHI and M-COP have paid in full. Fitch has also affirmed these rake classes in the Whitehall/Starwood Golf Portfolio as: -- $7.2 million class M-GP at 'AA+'; -- $18.8 million class N-GP at 'AA-'; -- $22.2 million class O-GP at 'A+'; -- $28.5 million class P-GP at 'A-'; -- $15.4 million class Q-GP at 'BBB+'; -- $21.1 million class R-GP at 'BBB'; -- $28.6 million class S-GP at 'BBB-'; -- $31.9 million class T-GP at 'BB+'; -- $32.4 million class U-GP at 'BB'; -- $13.4 million class V-GP at 'B+'. The upgrades to classes E and F are based on the increase in credit enhancement levels resulting from the payoff of two loans (8.1%) since Fitch's previous rating action in May 2007. The Long Beach Hilton and the Crescent Office Portfolio loans paid in full in July and August 2007, respectively. Based on year end 2006 financial statements, the Fitch stressed debt service coverage ratio on the trust portion of the Whitehall/Starwood Golf Portfolio loan ($195.1 million) was 3.24 times, up from 3.01x at issuance. When the non-pooled rake portions of that loan are added to the calculation, an additional $219.5 million, the DSCR is 1.53x. The pooled Whitehall/Starwood Golf Portfolio loan now makes up 27% of the transaction. The largest loan, Toys R Us DE Portfolio, makes up 36.7% of the remaining transaction balance. In all, eight of the original 17 loans remain. As of the August 2007 distribution date, 57.1% of the transaction has paid off, with the balance of the transaction at $723.2 million, down from $1.68 billion at issuance. CORNERSTONE-CAMERON: Case Summary and 20 Largest Unsec. Creditors ----------------------------------------------------------------- Debtor: Cornerstone-Cameron & Stonegate, Inc. 14504 Greenview Drive, Suite 510 Laurel, MD 20708-3202 Bankruptcy Case No.: 07-27849 Type of Business: The Debtor is a charitable organization engaged in housing development, construction and management. Chapter 11 Petition Date: August 20, 2007 Court: Western District of Tennessee (Memphis) Judge: David S. Kennedy Debtor's Counsel: Steven N. Douglass, Esq. Harris Shelton Hanover Walsh, P.L.L.C. 2700 One Commerce Square Memphis, TN 38103 Tel: (901) 525-1455 Fax: (901) 526-4084 Estimated Assets: $1 Million to $100 Million Estimated Debts: $1 Million to $100 Million Debtor's 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Street & Sons $24,510 7938 U.S. Highway 70 Memphis, TN 38111 Protective Services Carpet $7,460 Co., Inc. 4599 Damascus Road Memphis, TN 38118 Memphis Light Gas & Water $5,568 P.O. Box 388 Memphis, TN 38145-0388 Mid-South Paving Maintenance $3,000 Callsource $2,929 Consumer Source, Inc. $2,640 Harkavy Shainberg Kaplan & $2,475 Dunstan H.D. Supply Facilities $1,782 Climate Zone Air $1,735 The Carpet Specialist $1,637 Body, Inc. $1,605 Dillard Door & Entrance Control $1,304 Culpepper Plumbing, Inc. $1,276 Mid America Appliance Parts $1,077 Center U.S. Food Service, Inc. $970 All Rite Plumbing Parts, Inc. $844 For Rent Magazine $838 Pro-Comp Services $585 Carpet Savers $540 Heavenly Pools $499 COUNTRYWIDE FINANCIAL: Provides Reassurance to Customers -------------------------------------------------------- Countrywide Financial Corp., through ads released in U.S. newspapers, reassured banking customers that their money was safe and that the "future is bright," the Associated Press reports. The ads, as cited by AP, stated that the bank: * has assets of more than $100 billion, * has investment-grade ratings from three major credit rating agencies; and * credit woes currently hurting its lending business won't affect federally insured deposits. AP relates, citing Countrywide Financial spokesman Daniel Weidman, that the company will do whatever it takes to reassure people that the company is solid. Job Cuts The company also disclosed Monday that it had eliminated around 500 jobs in an effort to weather the problems currently encountered by the home loan industry, AP adds. The job cuts came mainly from its Wholesale Lending Division and its Full Spectrum Lending unit. Revolving Credit Facilities As reported in the Troubled Company Reporter on Aug. 17, 2007, Countrywide Financial Corporation, Countrywide Home Loans, Inc., and Countrywide Bank, N.A., disclosed that they have fully tapped their five unsecured revolving credit facilities as of August 16, drawing around $11.5 billion to provide necessary liquidity after losing access to the commercial paper market. The loan agreements require CFC to maintain Consolidated Net Worth at any of no less than $7,680,000,000 and require CHL to maintain Consolidated Net Worth at any time of no less than $2,400,000,000. Countrywide Bank, which is a federal savings bank, is subject to capital requirements imposed by the Office of Thrift Supervision. Bankruptcy Speculation Kenneth Bruce, a Merrill Lynch & Co. analyst in San Francisco, raised the possibility that Countrywide might need to seek protection from creditors under chapter 11 in a research report entitled "Liquidity is the Achilles heel" distributed to Merrill Lynch clients August 15. "If liquidations occur in a weak market, then it is possible for CFC to go bankrupt," Mr. Bruce wrote. With $216 billion in assets and $202 billion in liabilities, Countrywide would be the largest chapter 11 filing in U.S. history by those measures. About Countrywide Founded in 1969, Countrywide Financial Corporation (NYSE: CFC) -- http://www.countrywide.com/-- is a diversified financial services provider and a member of the S&P 500, Forbes 2000 and Fortune 500. Through its family of companies, Countrywide originates, purchases, securitizes, sells, and services prime and nonprime loans; provides loan closing services such as credit reports, appraisals and flood determinations; offers banking services which include depository and home loan products; conducts fixed income securities underwriting and trading activities; provides property, life and casualty insurance; and manages a captive mortgage reinsurance company. At July 31, 2007, Countrywide employed 61,586 workers, 34,326 of which originate loans. CREDIT SUISSE: Fitch Junks Two Distressed Recovery Ratings ---------------------------------------------------------- Fitch Ratings maintains the long-term credit rating of Credit Suisse First Boston Mortgage Securities 1995-M1 and assigns Distressed Recovery ratings as: -- $1.5 million class F-1 at 'CCC/DR1'; -- $1.2 million class F-2 at 'CCC/DR1'. These classes are affirmed: -- $310,747 class B at 'AAA'; -- $7.8 million class C at 'AAA'; -- $2.8 million class D at 'A'; -- $5.1 million class E at 'B+'. Fitch does not rate the $2,112 class G-1, and G-2 has been reduced to zero balance due to realized losses. Classes A and interest- only A-X have paid in full. The assignments of the DR ratings are due to losses from anticipated unrecoverable interest shortfalls on classes F-1 and F-2. Currently there are no delinquent or specially serviced loans, but five (55%) of the seven loans in the transaction have debt service coverage ratios of less than 1.0 times. The collateral for the pool is multifamily low income housing tax credit properties located in Kentucky (38%), Washington (21%), Georgia (19%), Tennessee (13%), Minnesota (5%) and Arizona (3%). The servicer has reported that the properties have earned their 10-year tax credit annual benefit stream, and are now fulfilling the remaining 5-year compliance period, which is expected to end in 2009. As of the July 2007 distribution date, the transaction has paid down 76% to $18.6 million from $77.9 million at issuance. The transaction's structure is such that realized losses and interest losses are absorbed by classes depending on the originator of the disposed loan, with Dynex originated loans absorbed first by class G-2, then G-1, followed by F-2 and F-1. CBA originated loans first to G-1, then G-2, followed by F-1 and F-2. CYTOCORE INC: Posts $1 Million Net Loss in Quarter Ended June 30 ---------------------------------------------------------------- Cytocore Inc. reported a net loss of $1.0 million for the second quarter ended June 30, 2007, compared with a net loss of $2.5 million for the same period ended June 30, 2006. Revenues for the three months ended June 30, 2007, decreased from $26,000 for the three months ended June 30, 2006 to $18,000, approximately 30%. This decrease was the result of a reduction in revenue from the licensing fees for the slide-based installed systems. The decrease in net loss resulted primarily from the reduction in the non-cash charge to interest expense which represented a significant amount in 2006 and was the result of the beneficial conversion of debt to equity, partially offset by an increase in R&D and SG&A expenses due to the company expanding its operations. The company's consolidated balance sheet at June 30, 2007, showed $3.2 million in total assets, $2.7 million in total liabilities, and $517,000 in total stockholders' deficit. Full-text copies of the company's consolidated financial statements for the quarter ended June 30, 2007, are available for free at http://researcharchives.com/t/s?22d1 Going Concern Doubt Altschuler, Melvoin and Glasser LLP, in Chicago, expressed substantial doubt about Cytocore Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements as of the year ended Dec. 31, 2006. The auditing firm pointed to the company's recurring substantial net losses from operations and net capital deficiency. About Cytocore Inc. CytoCore Inc. (OTC BB: CYCR) -- http://www.cytocoreinc.com/-- is a publicly traded biotechnology company that is developing a proteomic-based method of screening and diagnosis for endometrial and cervical cancer. The company's major product is called the InPath(TM) System and is comprised of four distinct components: the e Collector(TM), protein-based biochemical cocktails and Slide Based Tests, the AIPS(TM) microscope platform, and a drug delivery system for treating cervical lesions. DLJ COMMERCIAL: Fitch Holds B- Rating on $8.9MM Class B-8 Certs. ---------------------------------------------------------------- Fitch Ratings upgraded one class of DLJ Commercial Mortgage Corp.'s commercial mortgage pass-through certificates, series 2000-CF1, as: -- $31 million class B-3 to 'A' from 'A-'. In addition, Fitch affirms these classes: -- $554.5 million class A-1B at 'AAA'; -- Interest-only class S at 'AAA'; -- $44.3 million class A-2 at 'AAA'; -- $37.7 million class A-3 at 'AAA'; -- $13.3 million class A-4 at 'AAA'; -- $31 million class B-1 at 'AAA'; -- $11.1 million class B-2 at 'AAA'; -- $8.9 million class B-4 at 'BBB+'; -- $2.2 million class B-5 at 'BBB'; -- $6.6 million class B-6 at 'BBB-'; -- $8.9 million class B-7 at 'B+'; -- $8.9 million class B-8 at 'B-'. Class A-1A has paid in full. Fitch does not rate the $4.7 million class C certificates. Class D has been reduced to zero due to realized losses. The upgrade reflects increased credit enhancement levels due to the additional defeasance of six loans (6.4%) since Fitch's last rating action. In total, 40 loans (47.6%) have defeased, including the largest loan (6.8%) and five additional top 10 loans (19.1%). As of the August 2007 distribution date, the pool has paid down 13.9% to $763.1 million from $886.2 million at issuance. There is currently one loan (0.1%) in special servicing. The loan is current and pending return to the master servicer. DUFF WAPINSKI: Case Summary & Largest Unsecured Creditor -------------------------------------------------------- Debtor: Duff Wapinski Ranch, LLC 55 Oakwood Drive Palos Park, IL 60464 Bankruptcy Case No.: 07-07412 Chapter 11 Petition Date: August 20, 2007 Court: Middle District of Florida (Ft. Myers) Judge: Alexander L. Paskay Debtor's Counsel: Richard Johnston, Jr., Esq. Kiesel Hughes & Johnston P.O. Box 1000 Fort Myers, FL 33902 Tel: (239) 337-3900 Fax: (239) 337-7968 Total Assets: $4,446,750 Total Debts: $3,900,300 Debtor's List of its Largest Unsecured Creditor: Entity Nature of Claim Claim Amount ------ --------------- ------------ Gary Wapinski Management Fees $78,000 55 Oakwood Drive Palos Park, IL 60464 DURA AUTOMOTIVE: Pacificor Backstop Rights Pact Gets Court Okay --------------------------------------------------------------- Dura Automotive Systems Inc. obtained the U.S. Bankruptcy Court for the District of Delaware's approval of its backstop rights purchase agreement with Pacificor LLC. Pacificor will underwrite 100% of the backstop commitments in connection with the sale of approximately 39.4% to 42.6% of the Reorganized Dura common stock in exchange for a new money investment of between $140,000,000 to $160,000,000. To address the issues raised by the Official Committee of Unsecured Creditors and other parties-in-interest, Dura and Pacificor signed an Amended Backstop Rights Purchase Agreement dated August 13, 2007. The Amended Backstop Agreement generally maintains the terms upon which Dura will pay fees to Pacificor: * a Backstop Commitment Fee equal 4% of the Rights Offering Amount, payable upon consummation of the contemplated Chapter 11 Plan; * an Alternative Transaction Fee equal to 3% of the Maximum Rights Offering Amount if the Debtors pursue an alternative transaction to the Rights Offering or otherwise fail to fulfill certain conditions; and * up to $1,000,000 as reimbursement for reasonable and documented out-of-pocket costs. The conditions for payment of the Alternative Transaction Fee were, however, modified under the Amended Backstop Agreement. The payment of the Expense Reimbursement is also regardless of whether any Alternative Transaction Fee is payable. The Debtors are required to provide the U.S. Trustee a copy of the expense reimbursement documentation submitted by Pacificor. The Amended Backstop Agreement also provides for additional modifications: (1) Terms of Chapter 11 Plan. Pacificor will have the right to terminate the Agreement if the Debtors file, or subseqently modify, a Chapter 11 plan containing terms not acceptable to it. The terms subject to Pacificor's acceptance, however, will be limited to these areas: (a) Exit Facility; (b) Size and composition of the Board of Directors; (c) Exercise Price; (d) New Organizational Documents; (e) Subscription Agreement and related notices and forms; (f) Stockholders' Agreement; (g) Registration Rights Agreement; or (h) Effective Date. The Amended Backstop Agreement excludes the Management Equity Program and Participation in the Rights Equity Offering among the matters subject to Pacificor's scrutiny. (2) Board of Directors. On the Effective Date, there will be seven directors on the Board of Directors of Reorganized DASI. The Board of Directors will be staggered into three classes with terms of three years each, except for the initial terms which will be for one, two and three year: (i) Pacificor's Power to Appoint. On the Effective Date, Pacificor will appoint three directors in its sole discretion provided, however, if Pacificor holds between 20 to 30% of the Company's New Common Stock on the Effective Date, it will have the right to appoint two directors, and if Pacificor holds less than 20% of the Company's New Common Stock on the Effective Date, it will have the right to appoint one director; (ii) Creditors Committee's Power to Appoint. On the Effective Date, the Committee will appoint two directors, both of whom will be Independent Directors. The directors appointed by the Committee on the Effective Date will be reasonably acceptable to Pacificor, provided, however, that in the event the number of directors that Pacificor has the right to appoint is reduced by one or two directors as a result of its ownership of Common Stock, the director or directors will be appointed by the Creditors Committee and no acceptance of Pacificor will be required for the appointment; and (iii) Old DASI Board's Power to Appoint. One director appointed by the Old DASI Board on the Effective Date will be an Independent Director, subject to reasonable approval by the Creditors Committee and the other will be the CEO of Reorganized DASI. (3) Waiver. In the event of that anyone of the conditions to the obligations of Pacificor under the Agreement is not or cannot be satisfied, Pacificor will, within 14 days after being notified thereof in writing by the Debtors or the Creditors Committee, elect either to waive the condition or to terminate the Agreement by providing written notice of its election to the Creditors Committee and to the Debtors. In the event that the Pacificor does not so elect in writing within the 14-day period, it will be conclusively deemed to have waived the condition. A full-text copy of the Amended Backstop Agreement is available for free at http://ResearchArchives.com/t/s?22d8 About DURA Automotive Rochester Hills, Mich.-based DURA Automotive Systems Inc. (Nasdaq: DRRA) -- http://www.DURAauto.com/-- is an independent designer and manufacturer of driver control systems, seating control systems, glass systems, engineered assemblies, structural door modules and exterior trim systems for the global automotive industry. The company is also a supplier of similar products to the recreation vehicle and specialty vehicle industries. DURA sells its automotive products to North American, Japanese and European original equipment manufacturers and other automotive suppliers. The Debtors filed for chapter 11 petition on Oct. 30, 2006 (Bankr. D. Del. Case No. 06-11202). Richard M. Cieri, Esq., Marc Kieselstein, Esq., Roger James Higgins, Esq., and Ryan Blaine Bennett, Esq., of Kirkland & Ellis LLP are lead counsel for the Debtors' bankruptcy proceedings. Mark D. Collins, Esq., Daniel J. DeFranseschi, Esq., and Jason M. Madron, Esq., of Richards Layton & Finger, P.A. Attorneys are the Debtors' co-counsel. Baker & McKenzie acts as the Debtors' special counsel. Togut, Segal & Segal LLP is the Debtors' conflicts counsel. Miller Buckfire & Co., LLC is the Debtors' investment banker. Glass & Associates Inc., gives financial advice to the Debtor. Kurtzman Carson Consultants LLC handles the notice, claims and balloting for the Debtors and Brunswick Group LLC acts as their Corporate Communications Consultants for the Debtors. As of July 2, 2006, the Debtor had $1,993,178,000 in total assets and $1,730,758,000 in total liabilities. The Debtors' exclusive plan-filing period expires on Sept. 30, 2007. (Dura Automotive Bankruptcy News, Issue No. 26 Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). DURA AUTO: Summary of Terms of Proposed Stockholders' Agreement --------------------------------------------------------------- The backstop rights purchase agreement between Dura Automotive Systems Inc. and Pacificor LLC attached a Stockholders' Agreement Term Sheet. TERM DESCRIPTION ---- ----------- Issuer Reorganized Dura Automotive Systems, Inc. Class and Shares of New Common Stock, $0.01 par value, of Amount of Reorganized DASI equal to 100% of the total number Securities of issued and outstanding shares of New Common to be Stock on the Effective Date. The shares of New issued Common Stock issued on the Effective Date will be held and, to the extent permitted, transferred through the Depository Trust Company. Initial Initial Stockholders will be (i) Pacificor, LLC, Stockholders in its capacity as a Senior Noteholder and the Backstop Party; (ii) Senior Noteholders receiving New Common Stock pursuant to the Chapter 11 Plan or the Rights Offering; and (iii) holders of certain Other General Unsecured Claims receiving New Common Stock pursuant to the Chapter 11 Plan. All transferees of the Initial Stockholders will be subject to, and bound by, the terms of the Stockholders Agreement. Holder of All holders of New Common Stock will hold such Record shares through The Depository Trust Company. Dilution All shares of New Common Stock issued on the Effective Date will be subject to dilution by the Management Equity Program. Any shares of New Common Stock issued under the Management Equity Program will be subject to, and bound by, the terms of the Stockholders Agreement. Initial Each Share of New Common Stock will have an initial Share value of $500,000 unless Pacificor consents to a lower value. If the amount of the recovery value on account of an Allowed Claim is less than the Initial Price, or any whole multiple thereof, and recovery on the Allowed Claim in satisfaction thereof is in the form of New Common Stock, then the Allowed Claim holder will receive the number of whole shares of New Common Stock determined by dividing the Allowed Claim by the Initial Share Price plus one fractional share of New Common Stock for the remaining portion of the Allowed Claim. No other fractional shares may exist after the Effective Date. Fees Pacificor will not receive any premium for selling or voting (or refraining from voting) its shares in any transaction, and no management fee, financial advisory or other consulting fees, non-compete fee, closing fee or like compensation will be payable to Pacificor. A copy of the Stockholder's Agreement Term Sheet is available at no charge at http://ResearchArchives.com/t/s?22d7 About DURA Automotive Rochester Hills, Mich.-based DURA Automotive Systems Inc. (Nasdaq: DRRA) -- http://www.DURAauto.com/-- is an independent designer and manufacturer of driver control systems, seating control systems, glass systems, engineered assemblies, structural door modules and exterior trim systems for the global automotive industry. The company is also a supplier of similar products to the recreation vehicle and specialty vehicle industries. DURA sells its automotive products to North American, Japanese and European original equipment manufacturers and other automotive suppliers. The Debtors filed for chapter 11 petition on Oct. 30, 2006 (Bankr. D. Del. Case No. 06-11202). Richard M. Cieri, Esq., Marc Kieselstein, Esq., Roger James Higgins, Esq., and Ryan Blaine Bennett, Esq., of Kirkland & Ellis LLP are lead counsel for the Debtors' bankruptcy proceedings. Mark D. Collins, Esq., Daniel J. DeFranseschi, Esq., and Jason M. Madron, Esq., of Richards Layton & Finger, P.A. Attorneys are the Debtors' co-counsel. Baker & McKenzie acts as the Debtors' special counsel. Togut, Segal & Segal LLP is the Debtors' conflicts counsel. Miller Buckfire & Co., LLC is the Debtors' investment banker. Glass & Associates Inc., gives financial advice to the Debtor. Kurtzman Carson Consultants LLC handles the notice, claims and balloting for the Debtors and Brunswick Group LLC acts as their Corporate Communications Consultants for the Debtors. As of July 2, 2006, the Debtor had $1,993,178,000 in total assets and $1,730,758,000 in total liabilities. The Debtors' exclusive plan-filing period expires on Sept. 30, 2007. (Dura Automotive Bankruptcy News, Issue No. 26 Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). EARTHFIRST TECH: Inks Orion Tie-Up to Build New Tire Facilty ------------------------------------------------------------ EarthFirst Technologies Incorporated has executed an agreement with Orion Industrial Services Corporation to joint venture the final design, construction and commercial roll-out of its next generation tire processing facility, known as the Catalytic Activated Vacuum Distillation Reactor. Under the terms of the Agreement, EarthFirst's WESCO subsidiary will contribute certain intellectual property rights relating to CAVD tire technology, use of the Mobile facility and up to $450,000 cash. Orion contributes certain intellectual property, construction and operational resources plus cash or cash equivalents of up to $850,000. Profits from the venture will be shared equally. "Orion's affiliate has been our CAVD engineering firm for years. We could not ask for a better partner" stated EarthFirst's chief executive officer John Stanton. EarthFirst has expended millions of dollars to perfect the CAVD system. In 2004 a full scale, pilot CAVD Reactor was built in Mobile, Alabama. This reactor named "Green-Go" has operated for over 750 hours and has successfully deconstructed over 1 Million pounds of tire chips into recoverable by-products consisting of carbon black, oil, steel and syngas. Last summer EarthFirst's new management in WESCO evaluated almost two years of data and discovered a previously disregarded carbon product and unused reactor technology. These were pursued with Orion, carbon customers and potential reactor customers and assimilated into an upgraded reactor design that should reliably produce readily saleable, commodity grade by-products. There are two pending patent applications covering WESCO's initial and improved reactor process, technology and design. In customer tests, WESCO's CAVD carbon black has been successfully substituted for Series 700 virgin carbon blacks and the CAVD tire oil has been found to be similar to a #6 Residual Oil. Series 700 carbon black list priced at approximately 71 cents per pound last week according to industry quotes. The nationwide average price of comparable Residual Oil was $1.34 per gallon in June, according to the most recent report released by the US Department of Energy. However, WESCO's CAVD products are something special states Brad Mierau, PhD and WESCO's vice president of operations. "EarthFirst's tire process creates high energy gas and liquid fuels low in toxic polyaromatics, and a carbon black proven to substitute for blacks derived from petroleum. In addition to producing commercially viable products, the recovery of carbon black already present in tires allows for reductions in green- house gas emissions relative to virgin production methods. Rising fuel prices, the energy content of our fuel and the ability to market our CAVD carbon in applications currently dominated by commodity blacks should make the WESCO CAVD process attractive financially and environmentally." Dr. Mierau concluded, "EarthFirst's Green-Go Reactor could lead an industry revolution in handling of the 285,000,000 waste tires generated in the United States annually. Tires should no longer be burned or buried because each tire contains more than 5 pounds of valuable carbon, over 40,000 BTU's of gas and 1.5 gallons of oil. WESCO's CAVD process recovers these by-products using an estimated 5% of the energy while producing only 5% of the CO2 it takes to create virgin carbon black and oil products. Most significantly WESCO's CAVD process has been certified by Oak Ridge National Laboratory as producing virtually no fugitive emissions." Earlier this year, WESCO's reactor and facility in Mobile was granted a full operating air-permit by the Alabama Department of Environmental Management. Orion's John Kateon has been designated as the president and chief executive officer of the WESCO/Orion CAVD tire reactor venture. Kateon and Orion's affiliate have substantial experience conducting engineering projects for major companies like Chevron/Texaco, GE Energy, Shell Oil and Hunt Refining. Mr. Kateon remarked, "This will be a challenge and we all have a lot riding on success. But, I feel WESCO's CAVD will finally deliver as promised. It has been all about EarthFirst's new management on the project following our joint development vision. All the heavy lifting has been done over the last several months. We are building a truly commercial machine to run 24/7 and is designed to make high quality by-products from a waste stream. If we are serious as a Nation about CO2 reduction and going green, there is no better way to dispose of tires." Revamp of the EarthFirst "Green-Go" Reactor in Mobile, Alabama is estimated to begin within 45 days and scheduled for completion by years end. About EarthFirst Technologies Headquartered in Tampa, Florida, EarthFirst Technologies Inc. -- (OTC BB: EFTI) -- http://www.earthfirsttech.com/-- is a specialized holding company engaged in researching, developing and commercializing technologies for the production of alternative fuel sources and the destruction and/or remediation of liquid and solid wastes, and in supplying electrical contracting services to commercial and government customers internationally. Through its subsidiary World Environmental Solutions Company (WESCO), EarthFirst markets solid waste remediation plants utilizing a proprietary Catalytic Activated Distillation (CAVD) process, which is a superior technology developed by EarthFirst to recycle rubber tires and other waste by heating the material without burning it. Through its subsidiary Electric Machinery Enterprises, Inc., the company provides electrical contracting services both as a prime contractor and as a subcontractor, electrical support for industrial and commercial buildings, power generation stations, and water and sewage plants in the US and abroad. Through its subsidiary, SolarDiesel Corporation, the company is primarily focused on facilitating commercial scale production and distribution of biofuels produced from palm oil. Going Concern Doubt As reported in the Troubled Company Reporter on May 24, 2007, Aidman, Piser & Company P.A., in Tampa, Florida, expressed substantial doubt about EarthFirst Technologies Inc.'s ability to continue as a going concern after auditing the company's financial statements as of the years ended Dec. 31, 2006 and 2005. The auditing firm pointed to the company's significant losses and negative operating cash flows during the years ended Dec. 31, 2006, and 2005, working capital deficiency at Dec. 31, 2006, and expectations that additional capital will be required in order to continue operations in 2007. The company continues to experience cash flow difficulties and is delinquent on payment of many of its trade creditors, its secured convertible notes and a $100,000 unsecured note payable. EARTHFIRST TECH: June 30 Balance Sheet Upside-Down by $3.4 Million ------------------------------------------------------------------ EarthFirst Technologies Inc.'s consolidated balance sheet showed $20.6 million in total assets and $24.0 million in total liabilities, resulting in a $3.4 million total stockholders' deficit. The company's consolidated balance sheet at June 30, 2007, also showed strained liquidity with $9.3 million in total current assets available to pay $17.7 million in total current liabilities. The company reported a net loss of $3.1 million and a loss from operations before reorganization item, income taxes and majority and minority interest of $674,376, on revenues of $6.7 million for the second quarter ended June 30, 2007. This compares with a net loss of $1.5 million and a loss from operations before reorganization item, income taxes and majority and minority interest of $1.1 million, on revenues of $12.9 million for the same period ended June 30, 2006. This decrease in revenue relates to smaller jobs being performed during 2007. During 2006, the company had some very large contracts, although they didn't produce large gross margins. The contracts in 2007 are more focused on profitability, and consist of contracts that are smaller in dollars. The decrease in loss from operations before reorganization item, income taxes and majority and minority interest primarily reflects an increase in gross profit and a decrease in SG&A expenses. The increase in net loss primarily reflects a derivative loss of $546,587 in the quarter ended June 30, 2007, versus a derivative gain of $618,868 in the same period in 2006, and an increase in interest expense. These were partly offset by the decrease in loss from operations before reorganization item, income taxes and majority and minority interest. Gross profit for the three month period ending June 30, 2007 increased from $1.7 million to $2.0 million, or approximately 15% when compared to the three month period ending June 30, 2006. Although revenues for the three months ended June 30, 2007, have declined significantly when compared to the three months ended June 30, 2006, the company has improved its gross profit percentages. Selling, general and administrative expenses for the three-month period ending June 30, 2007, decreased by $223,408 from $2.7 million, to $2.5 million in the current period, or a decrease of approximately 8% compared to the three-month period ending June 30, 2006. Loss from operations exclusive of share based compensation would have been $430,810 for the three months June 30, 2007. Derivative gain decreased from a gain of $618,868 for the three month period ended June 30, 2006, to a loss of $546,587 for the three month period ended June 30, 2007. The derivative gain or loss is associated with the company's Laurus credit facility and fluctuations occur normally in the fair value adjustment of the derivatives each reporting period, which result primarily from fluctuations in the company's stock price. Interest expense increased from $904,830 for the three month period ended June 30, 2006, to $1.7 million for the three months ended June 30, 2007. This change in interest expense are primarily due to amortization of the debt discounts associated with the Laurus credit facility, and the reduction in the amount of principal when compared to the prior year. Full-text copies of the company's consolidated financial statements for the quarter ended June 30, 2007, are available for free at http://researcharchives.com/t/s?22d4 Going Concern Doubt As reported in the Troubled Company Reporter on May 24, 2007, Aidman, Piser & Company P.A., in Tampa, Florida, expressed substantial doubt about EarthFirst Technologies Inc.'s ability to continue as a going concern after auditing the company's financial statements as of the years ended Dec. 31, 2006 and 2005. The auditing firm pointed to the company's significant losses and negative operating cash flows during the years ended Dec. 31, 2006, and 2005, working capital deficiency at Dec. 31, 2006, and expectations that additional capital will be required in order to continue operations in 2007. The company continues to experience cash flow difficulties and is delinquent on payment of many of its trade creditors, its secured convertible notes and a $100,000 unsecured note payable. About EarthFirst Technologies Headquartered in Tampa, Florida, EarthFirst Technologies Inc. -- (OTC BB: EFTI) -- http://www.earthfirsttech.com/-- is a specialized holding company engaged in researching, developing and commercializing technologies for the production of alternative fuel sources and the destruction and/or remediation of liquid and solid wastes, and in supplying electrical contracting services to commercial and government customers internationally. EAST VALLEY: S&P Rates $153 Mil. Senior Secured Facility at B+ -------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B+' rating to the East Valley Tourist Development Authority's $153 million senior secured bridge term facility. The Authority is an instrumentality of the California-based Cabazon Band of Mission Indians, through which it operates the Fantasy Springs Resort and Casino near Palm Springs, California. The Authority used proceeds from the term loan principally to repay existing debt obligations of the Tribe. Concurrently, S&P have withdrawn our rating on the formerly proposed $290 million senior secured note offering, as the marketing of this deal has been delayed due to existing conditions in the credit markets. S&P expect that the Authority will return to market with a note offering in the coming weeks on which S&P expect to assign ratings upon reviewing the terms and conditions. S&P affirmed its 'B+' issuer credit rating on the Authority and revised the rating outlook to negative from stable. "The outlook revision reflects our expectation for a meaningful increase in financing costs given existing conditions in the credit markets," explained Standard & Poor's credit analyst Guido DeAscanis. "This is despite the fact that under the bridge facility structure there will be about $75 million less in debt than at peak levels under the previously proposed notes." If the Authority does not complete a refinancing transaction, the terms for the bridge loan include a schedule of step-ups in interest rate spreads, with an initial 100-basis-point step-up in January 2008 and 50-basis-point increases every three months thereafter until reaching a maximum spread of 750 basis points. In the event that the Authority successfully completes a debt financing transaction, from which a portion of proceeds are used to repay the bridge loan facility in full, S&P would expect that interest rates associated with the offering would be meaningfully higher that those which were assumed for the previously proposed note offering. The 'B+' issuer credit rating reflects the Authority's narrow business focus operating in a single market, the existence of well-established competition, and the potential for expanded competition. These factors are tempered by favorable recent operating results and the solid demographics of the market. The Authority's financials will not be publicly available. However, growth has been strong: Fantasy Springs has averaged double-digit growth rates in gaming revenue, gross revenue, and EBITDA during the past several years, although the property's EBITDA base is fairly modest. EBITDA margins compare favorably to Standard & Poor's rated gaming universe and other Native American casinos, in part due to the Tribe's modest revenue share arrangement with California under its compact. During the recent audit of The Authority's financials, two instances of material weakness were identified. S&P have reviewed the underlying circumstances and are comfortable with these issues within the bounds of the current rating. EDWIN MOLINA: Case Summary & 19 Largest Unsecured Creditors ----------------------------------------------------------- Debtors: Edwin D. Torres Molina Ivonne R. Pinol Santana Calle Aldea, Suite 1412 San Juan, PR 00907 Bankruptcy Case No.: 07-04684 Chapter 11 Petition Date: August 21, 2007 Court: District of Puerto Rico (Old San Juan) Debtors' Counsel: Antonio Fiol Matta, Esq. 1561 Avenue Americo Miranda URB Caparra Terrace San Juan, PR 00921 Tel: (787) 792-4368 Fax: (787) 792-4763 Total Assets: $1,824,125 Total Debts: $1,267,513 Debtors' List of its 19 Largest Unsecured Creditors: Entity Claim Amount ------ ------------ Eurobank $25,000 P.O. Box 191009 San Juan, PR 00919-1009 Ivette Alamo Gomez $16,000 p/c LCDO. Carlos J. Rivera Santiago PMB #420 P.O. Box 4960 Caguas, PR 00726-4960 Internal Revenue Service $9,168 Centralized Insolvency Operations P.O. Box 21126 Philadelphia, PR 19114-0326 CRIM $8,411 Departamento De Hacienda $6,807 LVNV Funding LLC $4,988 Banco Popular de PR $4,160 Autoridad de Energia Electrica $3,295 Banco Santander $3,155 Coop. de Ahorro y Credito Zeno Gandia $2,919 Citibank USA NA $2,264 Autoridad de Energia Electrica $1,540 Maria Cabrera Flores $1,500 PEP Boys- Spanish/GEMB $236 Credit Protection $205 Popular Insurance $141 American Express $100 Gatsby $81 JC Penney $38 ELEPHANT TALK: June 30 Balance Sheet Upside-Down by $6.6 Million ---------------------------------------------------------------- Elephant Talk Communications Inc.'s consolidated balance sheet at June 30, 2007, showed $21.6 million in total assets, $27.8 million in total liabilities, and $250,921 in minority interest, resulting in a $6.6 million total stockholders' deficit. The company's consolidated balance sheet at June 30, 2007, also showed strained liquidity with $7.4 million in total current assets available to pay $21.6 million in total current liabilities. The company reported a net loss of $6.2 million of $12.5 million for the second quarter ended June 30, 2007, compared with a net loss of $525,855 for the comparable period in 2006. The company reported revenues of $12.5 million for the three months ended June 30, 2007, compared to $46,613 for the same period in 2006. Revenues for the three months ended June 30, 2007, consisted of $8.6 million primarily from the premium rate services provided by the company's subsidiary Elephant Talk Communication Holding AG to its customers. During the three months ended June 30, 2006, the company recorded revenues by only selling telecommunications products business such as voice and data transmission like IDD, pre-paid calling cards, eTalk and facsimile services provided to retail customers in China, Japan and Hong Kong. The increase in net loss mainly reflects stock compensation expenses of $4.7 million, an increase in SG&A and depreciation and amortization expenses, partly offset by an increase in gross profit as a result of the increase in revenues. In addition, the company recorded income of $153,907 from the operations of abandoned entity in the 2006 quarter that was not replicated in the 2007 quarter. Gross margins for the three months ended June 30, 2007, was $603,132, or 4.8% of revenues as compared to $2,087, or 4.5% of revenues for the same period in 2006. Selling, general and administrative expenses were $1.5 million for the three months ended June 30, 2007, compared to $573,387 for the same period in 2006. SG&A expenses increased during the three months ended June 30, 2007, compared to the same period in 2006, primarily due to the increase in marketing and promotion expenses of the premium rate services offered to the company's subscriber base and other legal and administrative expenses of the newly acquired businesses. During the three months and six months ended June 30, 2007, the company recorded an expense of $4.7 million in stock compensation to officers and directors as sign up bonus for executing employment agreements for a three year term. Depreciation and amortization expense for the three months ended June 30, 2007, increased to $516,859 as compared to $9,415 for the same period in 2006 primarily due to the acquisition of assets by the subsidiaries of the Company in 2007. Interest expense was $193,309 for the three months ended June 30, 2007, compared to $108,271 for the same period in 2006. Interest expense increased due to the company borrowing additional loans from investors and bank. Full-text copies of the company's consolidated financial statements for the quarter ended June 30, 2007, are available for free at http://researcharchives.com/t/s?22d6 Going Concern Doubt As reported in the Troubled Company Reporter on May 2, 2007, Kabani & Company Inc. expressed substantial doubt about the Elephant Talk Communications Inc.'s ability to continue as a going concern after auditing the company's financial statements as of Dec. 31, 2006. The auditing firm pointed to the company's loss of $4,829,665, working capital deficit of $3,181,589, accumulated deficit of $16,962,100, and cash used in operations of $1,330,061. The company has an accumulated deficit of $23,932,141 including a net loss of $7,644,721 for the six months ended June 30, 2007. In addition, the company is in default of making loan payments on its credit facility with a bank in Hong Kong. About Elephant Talk Based in Tsuen Wan, Hong Kong, Elephant Talk Communications Inc. (OTC BB: ETLK) -- http://www.elephanttalk.com/-- offers primarily wholesale international long-distance between North America and Asia through its Hong Kong-based operating subsidiary, Elephant Talk Limited. The facilities-based carrier uses both circuit switched and Internet protocol (IP)-based technology and operates switching facilities in China, Hong Kong, Singapore, and the US. Elephant Talk also offers both prepaid and postpaid calling cards and other value-added services. ENHANCED MORTGAGE: Fitch Junks Rating on $30MM Class B Jr. Notes ---------------------------------------------------------------- Derivative Fitch downgraded one class of notes issued from Enhanced Mortgage-Backed Securities Fund V Ltd. and placed three classes on Rating Watch Negative. The rating actions are: -- $20,000,000 Class A-3 Subordinated Notes 'BBB+', placed on Rating Watch Negative; -- $6,000,000 Class A-4 Junior Subordinated Notes 'BBB', placed on Rating Watch Negative; -- $30,000,000 Class B Junior Subordinated Income Notes downgraded to 'CCC' from 'BB' and placed on Rating Watch Negative. EMBS V is a mortgage market value CDO managed by Babson Capital Management LLC. The structure has subordination tests for the classes A-1, A-2, A-3, and A-4 notes designed to protect senior rated notes from declines in the market value of the portfolio. However, the Classes A-3 and A-4 note triggers are not effective as long as a total note NAV trigger is not hit as well. In the event where the NAV trigger is tripped, the asset manager must sell assets from the portfolio until the class A-3 and A-4 test are passing the predetermined levels. The downgrades of the class B income notes reflect Fitch's opinion that the breach of the EMBS V NAV trigger is imminent and the subsequent deleveraging would realize market value losses to the income notes. The placement on Rating Watch Negative is due to uncertainty in the transaction prices that will be achieved during the anticipated forced sale of assets given the price volatility that even highly rated securities have seen in the current market environment. The rating of the Class B Junior Subordinated Income Notes only reflects the likelihood that investors will receive their stated principal balances upon the legal final maturity date. ENHANCED MORTGAGE: Fitch Puts B- Shares Rating Under Neg. Watch --------------------------------------------------------------- Fitch places one class of notes issued from Enhanced Mortgage- Backed Securities Fund IV Ltd on Rating Watch Negative. These rating actions are effective immediately: -- $30,000,000 Preference Shares 'B-' on Rating Watch Negative. EMBS IV is a mortgage market value CDO managed by Babson Capital Management LLC. The structure has subordination tests for the Class A-1 through A-4 notes, designed to protect senior rated notes from declines in the market value of the portfolio. However, the class A-3 and class A-4 note triggers are not effective as long as a total note NAV trigger is not hit as well. In the event where the NAV trigger is tripped, the asset manager must sell assets from the portfolio until the class A-3 and class A-4 test are passing the predetermined levels. The rating watch negative action of the preference shares reflects Fitch's opinion that the breach of the EMBS IV NAV trigger may occur in the near future and the subsequent deleveraging would realize market value losses to the preference shares. The rating of the Preference Shares only reflects the likelihood that investors will receive interest and/or principal payments in an amount equal to the stated principal balances on or before the legal final maturity date. FIDELITY NATIONAL: S&P Affirms BB+ Rating on Preferred Stock ------------------------------------------------------------ Standard & Poor's Ratings Services revised its outlook on Fidelity National Financial Inc. and FNF's title insurance subsidiaries Alamo Title Insurance Co., Chicago Title Insurance Co., Chicago Title Insurance Co. of OR, Fidelity National Title Insurance Co., Security Union Title Insurance Co., and Ticor Title Insurance Co. to stable from positive. At the same time, Standard & Poor's affirmed its 'BBB' counterparty credit rating on FNF and its 'A' counterparty credit and financial strength ratings on FNF Title. In addition, Standard & Poor's affirmed its 'BBB' senior debt, 'BBB-' subordinated debt, and 'BB+' preferred stock ratings on FNF. "The revised outlook on FNF reflects the prolonged challenging environment for all title insurers," said Standard & Poor's credit analyst James Brender. "Under current conditions, it is no longer appropriate for Standard & Poor's to consider an upgrade of FNF or FNF Title. The revised outlook does not indicate any company- specific concerns, and FNF met the expectations required for consideration of an upgrade." FNF's debt to total capitalization as of June 30, 2007, was 20%, compared with 45% at the end of 2005. This favorable change reflects the spin-off of FNF's 51% stake in Fidelity National Information Services in November 2006. FNF Title continues to generate very strong operating results despite a challenging environment for title insurers. The ratings on FNF Title reflect the group's strong competitive position as one of the largest domestic title insurance groups, effective management of operations during cyclical fluctuations in mortgage market activity, and consistently superior profit margins. Offsetting the company's strengths are the challenging conditions facing the title insurance industry and FNF Title's limited diversification. "FNF Title has a very strong competitive position, and operating performance has been consistently strong," said Mr. Brender. "The group's profitability differentiates it from its peers. Total revenues increased by 169% from 2001 to 2006, and the group has had the highest pretax operating margins every year since at least 2000." Standard & Poor's views the environment for title insurers as challenging. In addition to garnering more attention from regulators, title insurers must contend with a protracted decline in originations. The causes of the decrease are higher interest rates and a pessimistic view of home price appreciation. Despite these conditions, FNF Title's competitive position is expected to remain strong. Standard & Poor's believes FNF Title's operating performance will continue to be superior to its peers. However, results for the rest of 2007 and 2008 will be depressed compared with prior years. FINDEX.COM INC: Posts $343,500 Net Loss in Quarter Ended June 30 ---------------------------------------------------------------- FindEx.com Inc. reported on Aug. 17, 2007, its financial results for the second quarter ended June 30, 2007. The net loss for the three months ended June 30, 2007, was approximately $343,500, a decrease of approximately $1.2 million compared to a net income of approximately $862,000 for the three months ended June 30, 2006. The net loss for the six months ended June 30, 2007 was approximately $349,000, a decline of approximately $324,000 compared to a net loss of approximately $25,000 for the six months ended June 30, 2006. It should be noted that included in the net results for the three and six months ended June 30, 2007, are derivative valuation gains of approximately $27,200 and $53,700, respectively, compared to valuation gains of approximately $1.5 million and $872,500, respectively for the three and six months ended June 30, 2006, and non-recurring expenses related to registration rights penalties of approximately $-0- and $49,300, respectively for the three and six months ended June 30, 2006, compared to zero for the same periods of 2007. For the three months ended June 30, 2007, gross revenue was approximately $710,100, a 1% increase of $9,500 compared to gross revenue of approximately $700,600 for the three months ended June 30, 2006. For the six months ended June 30, 2007, gross revenue was approximately $2.0 million, a 5% increase of $97,400 from the gross revenue of approximately $1.9 million for the six months ended June 30, 2006. Gross profit for the second quarter 2007 was 53%, a 96% improvement compared to the 27% gross profit for the second quarter 2006. For the six months ended June 30, 2007, gross profit increased to 56% from 45% for 2006, a 24% improvement. Total operating expenses for the three months ended June 30, 2007, decreased to approximately $693,000, a 13% improvement over the approximately $793,000 for the three months ended June 30, 2006, and decreased to approximately $1.4 million for the six months ended June 30, 2007, a 14% improvement over the approximately $1.6 million for the same period in 2006. Total sales, general and administrative costs were approximately $540,000 or 76% of gross sales and approximately $1.1 million or 54% of gross sales for the three and six months ended June 30, 2007, respectively. These 2007 numbers compare to the approximately $648,000 or 92% of gross sales and approximately $1.3 million or 70% of gross sales for the three and six months ended June 30, 2006. During the first six months of 2007, the company has incurred total software development costs of approximately $191,000, compared to approximately $238,000 for the same period in 2006. Kirk Rowland, FindEx.com's chief financial officer commented, "We were pleased to continue improvements in our gross revenue, gross profit and reduction of our operating expenses. We have continued to be an efficient and productive enterprise and we are projecting operating expenses to remain flat in the third quarters of 2007 before picking up in our busy fourth quarter. Our focus remains to improve top line growth by continuing to introduce new products and platforms, as well as enhancing and upgrading our existing product lines. We believe we remain positioned to ramp revenue in the third and fourth quarters that will bring us back to profitability by year end." At June 30, 2007, the company's consolidated financial statements showed $2.8 million in total assets, $2.6 million in total liabilities, and $213,042 in total stockholders' equity. The company's consolidated balance sheet at June 30, 2007, also showed strained liquidity with $630,853 in total current assets available to pay $2.5 million in total current liabilities. Full-text copies of the company's consolidated financial statements for the quarter ended June 30, 2007, are available for free at http://researcharchives.com/t/s?22cf Going Concern Doubt As of June 30, 2007, the company had a year-to-date net loss of $349,233, and negative working capital of $1.9 million and an accumulated deficit of $7.4 million as of June 30, 2007. Management believes these factors raise substantial doubt as to their ability to continue as a going concern through Dec. 31, 2007, but have taken several actions to mitigate against this risk. These actions include selling some of its intangible assets and pursuing mergers and acquisitions that will provide profitable operations and positive operating cash flow. About FindEx.com Inc. FindEx.com Inc. (OTC BB: FIND.OB) -- http://www.quickverse.com/ -- develops and publishes church and Bible study software products designed to simplify biblical research, streamline church office tasks, provide easy access to Bible-related stories, and enhance the user's understanding of the Bible. The company also publishes a product for the financial and data management of churches and non-profit service organizations. The company's one operating division called The Parsons Church Group was acquired in July 1999 from The Learning Company, a division of Mattel Inc. FindEx.com Inc. is headquartered in Omaha, Nebraska. FULTON STREET: Poor Credit Quality Cues Fitch to Lower Ratings -------------------------------------------------------------- Fitch affirmed two and downgraded four classes of notes issued by Fulton Street CDO, Ltd. and its co-issuer Fulton Street CDO Funding Corp. The rating actions are: -- $159,600,209 class A-1A notes affirm at 'AAA'; -- $131,226,839 class A-1B notes affirm at 'AAA'; -- $34,000,000 class A-2 notes downgrade to 'A+' from 'AA'; -- $9,186,975 class B-1 notes downgrade to 'B-' from 'BBB' and remove from Rating Watch Negative; -- $10,201,164 class B-2 notes downgrade to 'B-' from 'BBB' and remove from Rating Watch Negative; -- $6,282,429 class C notes downgrade to 'C/DR6' from 'B-/DR1' and remove from Rating Watch Negative. Fulton is a collateralized debt obligation that closed March 27, 2002 and is managed by Clinton Group, Inc. Fulton ended its revolving period on April 20, 2006. The collateral supporting the CDO is composed of a diversified portfolio of approximately 41% residential mortgage-backed securities, of which 18% is from the 2005 - 2006 vintage, 8% commercial mortgage-backed securities, 19% asset-backed securities, 16% corporate debt securities, and 16% collateralized debt obligations. The downgrade of the class A-2, B and C notes is the result of continued deterioration of portfolio credit quality. Since the last review 5% of the portfolio has been downgraded increasing the WARF to 16 ('BBB/BBB-') from 15 ('BBB/BBB-'), as of the most recent trustee report dated, July 15, 2007. The class B and C OC tests and the class A1, A2 and B IC tests are failing their covenants. Failure of these coverage tests has led to interest proceeds being diverted from the class C and B notes to cure the failing coverage tests. In addition, all principal proceeds are also being diverted to the class A notes to cure the failing class A-1 and A-2 IC tests. There is currently one defaulted asset amounting to $877,849 of the portfolio as of the most recent trustee report. In Fitch's view the percentage of the portfolio of below investment grade quality is 9%, and of that, 3% is of 'CCC' and below quality. Fulton also has 4% of its portfolio on Rating Watch Negative. The affirmation of the class A-1 notes is due to positive structural features which have caused the senior notes to delever as a result of the diversion of principal and interest proceeds to cure failing coverage tests. The class A-1A notes also benefit from an insurance wrap provided by MBIA (Insurer Financial Strength rated 'AAA' by Fitch). The ratings on the class A-1A, A-1B and A-2 notes address the timely payment of interest and ultimate receipt of principal; the ratings on the class B-1, B-2 and C notes address the ultimate payment of interest and principal. The class A-1A and A-1B notes have a legal final maturity of April 2032; the class A-2, B-1, B- 2, and C notes have a legal final maturity of April 2037. GLOBAL ENTERTAINMENT: Posts $812,176 Net Loss in Second Quarter --------------------------------------------------------------- Global Entertainment Holdings/Equities Inc. reported a net loss of $812,176 for the second quarter ended June 30, 2007, compared with a net loss of $507 for the same period in 2006. At June 30, 2007, the company's consolidated balance sheet showed $61.4 million in total assets, and $3.4 million in total liabilities, resulting in a $58.0 million total stockholders' equity. The company has never generated any revenue from the distribution of its films. The increase in net loss is mainly due to selling, general and administrative expenses which increased to $822,142 during the quarter ended June 30, 2007, compared with SG&A expenses of $507 during the 2006 quarter. Full-text copies of the company's consolidated financial statements fort the quarter ended June 30, 2007, are available for free at http://researcharchives.com/t/s?22d9 Going Concern Doubt Spector and Wong LLP, in Pasadena, California, expressed substantial doubt about Global Entertainment Holdings/Equities Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements for the year ended Dec. 31, 2006. The auditing firm pointed to the company's operating losses of $1,105,375 and $743,019 for the years ended Dec. 31, 2006, and 2005, respectively. Management is attempting to develop sales to cover expenses and obtain an infusion of capital from private investors. About Global Entertainment Based in Miami, Global Entertainment Holdings/Equities Inc. (Other OTC: GAMT.PK) -- http://www.globalentertainmentco.com/-- is engaged in management and production of motion pictures in the United States. Its theatrical movies include its in house production and films acquired from third parties. The company has a library worth approximately $59.8 million in motion picture titles. GLOBAL HOME: Wants Until October 9 to File Chapter 11 Plan ---------------------------------------------------------- Global Home Products LLC and its debtor affiliates ask the U.S. Bankruptcy Court for the District of Delaware to further extend, until Oct. 9, 2007, their exclusive period to file a chapter 11 plan of reorganization. The Debtors also want their exclusive period to solicit acceptances of that plan further extended to Dec. 10, 2007. The Debtors says that despite the fact that their 17 chapter 11 cases have been pending for approximately 16 months, they have made substantial progress which included the sale of their Burnes Group, WearEver and Anchor Hocking assets. The Debtors disclose that they are presently devoting a significant amount of time toward reaching an agreement with key constituencies on the terms of a consensual plan. The Debtors contend that they need the additional time to complete the negotiations and file a plan and disclosure statement. The Court has set a hearing at 10:00 a.m., on August 24, to consider the Debtors' request. Headquartered in Westerville, Ohio, Global Home Products, LLC -- http://www.anchorhocking.com/and http://www.burnesgroup.com/ -- sells houseware and home products and manufactures high quality glass products for consumers and the food services industry. The company also designs and markets photo frames, photo albums and related home decor products. The company and 16 of its affiliates, including Burnes Puerto Rico, Inc., and Mirro Puerto Rico, Inc., filed for Chapter 11 protection on April 10, 2006 (Bankr. D. Del. Case No. 06-10340). Laura Davis Jones, Esq., Bruce Grohsgal, Esq., James E. O'Neill, Esq., and Sandra G.M. Selzer, Esq., at Pachulski, Stang, Ziehl, Young, Jones & Weintraub LLP, represent the Debtors. Kenneth A. Rosen, Esq., Sharon L. Levine, Esq., Bruce Buechler, Esq., and Wojciech F. Jung, Esq., at Lowenstein Sandler, P.C., and David M. Fournier, Esq., and Evelyn L. Meltzer, Esq., at Pepper Hamilton LLP represent the Official Committee of Unsecured Creditors. Huron Consulting Group LLC gives financial advice to the Committee. Schedules filed with the Court showed the Debtors having total assets and debts of more than $100 million. GLOBAL HOME: Committee Objects to Exclusivity Extension Plea ------------------------------------------------------------ The Official Committee of Unsecured Creditors of Global Home Products LLC and its debtor affiliates asks the U.S. Bankruptcy Court for the District of Delaware to deny the Debtors' request for extension of their exclusive periods. The Committee discloses that in their request, the Debtors cited nine factors typically considered by courts in determining whether cause exists to extend the Exclusivity Periods. The Committee however believes that, on balance, these factors weight strongly in favor of denial or conditioning of the Debtors' request. The Committee contends that although the Debtors' cases are relatively large, they are not particularly complex. All of the Debtors' operating assets have been sold through court-approved sales thus there is no more business for the Debtors to operate and they are no longer generating revenues. The Committee relates that there has been little tangible progress toward reorganization. Although the Debtors are correct that certain progress has been made with respect to their negotiations with the Committee and other creditor constituencies concerning a consensual plan for these chapter 11 cases, the Committee submits that these negotiations would come to fruition more quickly if the parties would enter into a term sheet for a plan of reorganization if the Debtors were required to provide the Committee with a draft plan of reorganization and disclosure statement by Aug. 30, 2007. The Committee argues that allowing the Debtors to maintain exclusivity for another two months - 18 months in total - will keep the playing filed tilted in their favor to the detriment of the unsecured creditors who have not received any payment on account of their claims for almost a year and a half. Headquartered in Westerville, Ohio, Global Home Products, LLC -- http://www.anchorhocking.com/and http://www.burnesgroup.com/ -- sells houseware and home products and manufactures high quality glass products for consumers and the food services industry. The company also designs and markets photo frames, photo albums and related home decor products. The company and 16 of its affiliates, including Burnes Puerto Rico, Inc., and Mirro Puerto Rico, Inc., filed for Chapter 11 protection on April 10, 2006 (Bankr. D. Del. Case No. 06-10340). Laura Davis Jones, Esq., Bruce Grohsgal, Esq., James E. O'Neill, Esq., and Sandra G.M. Selzer, Esq., at Pachulski, Stang, Ziehl, Young, Jones & Weintraub LLP, represent the Debtors. Kenneth A. Rosen, Esq., Sharon L. Levine, Esq., Bruce Buechler, Esq., and Wojciech F. Jung, Esq., at Lowenstein Sandler, P.C., and David M. Fournier, Esq., and Evelyn L. Meltzer, Esq., at Pepper Hamilton LLP represent the Official Committee of Unsecured Creditors. Huron Consulting Group LLC gives financial advice to the Committee. Schedules filed with the Court showed the Debtors having total assets and debts of more than $100 million. HELEN WILLIAMS: Case Summary & Six Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Helen Jean Williams 208 Gilbert Drive Opelousas, LA 70570 Bankruptcy Case No.: 07-50996 Chapter 11 Petition Date: August 21, 2007 Court: Western District of Louisiana (Lafayette/Opelousas) Debtor's Counsel: Gerald H. Schiff, Esq. Gordon, Arata, McCollam, Duplantis & Eagan, LLP 400 East Kaliste Saloom Road Suite 4200 Lafayette, LA 70508-8517 Tel: (337) 237-0132 Fax: (337) 237-3451 Estimated Assets: $1 Million to $100 Million Estimated Debts: $50,000 to $100,000 Debtor's List of its Six Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Bank of America Recreational Vehicle $59,546 P.O. Box 538610 Atlanta, GA 30353-8610 Matrix International Loan $20,000 5318 Weslayne Avenue Houston, TX 77005 World Financial Network Purchase Household $594 National Bank Goods P.O. Box 659465 San Antonio, TX 78265-9455 Bedford Fair Lifestyles Purchase Household $350 Goods Macy's Purchase Household $126 Goods Bank of Georgia Purchase Household $114 Goods HOLLINGER INC: Bondholders Want Investment Protected ---------------------------------------------------- Bondholders of Hollinger Inc. ask the U.S. Bankruptcy Court for the District of Delaware for a boost in the collateral that protects their $93 million investment in the company, the Associated Press reports. The bondholders disclose that value of Sun-Times Media Group Inc.'s stock has "dropped precipitously" and it is likely that the company won't make the September 4 interest payment. Sun-Times Media's stock closed at $2.97 on Tuesday, August 21. According to AP, it traded at around $5.5o in June. According to documents filed with the Court, the noteholders want permission to seize the stock if the company is unable to prove that in can cover the $93 million debt. Based in Toronto, Ontario, Hollinger Inc. (TSX: HLG.C)(TSX: HLG.PR.B) -- http://www.hollingerinc.com/-- owns approximately 70.1% voting and 19.7% equity interest in Sun-Times Media Group Inc. (formerly Hollinger International Inc.), a media company with assets which include the Chicago Sun-Times newspaper and Suntimes.com and a number of community newspapers and websites serving communities in the Chicago area. The company, along with two affiliates, 4322525 Canada Inc. and Sugra Limited, filed separate Chapter 15 petitions on Aug. 1, 2007 (Bankr. D. Del. Case Nos. 07-11029 through 07-11031). Hollinger also initiated Court-supervised restructuring under the Companies' Creditors Arrangement Act (Canada) on the same day. Derek C. Abbott, Esq., and Kelly M. Dawson, Esq., at Morris, Nichols, Arsht & Tunnell LLP, represents the Debtors in their U.S. proceedings. ICON HEALTH: Moody's Withdraws "Caa1" Corporate Family Rating ------------------------------------------------------------- Moody's withdrew the ratings of ICON Health & Fitness, Inc. after the company entered into an agreement with a majority of its bondholders to no longer provide public information. ICON filed a Form 15 with the SEC indicating no additional information would be provided until further notice. These ratings have been withdrawn: -- $155 million 11.25% senior subordinated notes due 2012, Caa2 (LGD5, 80%) -- Corporate Family Rating, Caa1 -- Probability of Default Rating, Caa1 Based in Logan, Utah, ICON Health & Fitness, Inc. is one of the largest manufacturers and marketers of home fitness equipment in the United States. INDYMAC BANCORP: Fitch Places Ratings Under Negative Watch ---------------------------------------------------------- On Aug. 16, 2007, Fitch Ratings placed the ratings of Indymac Bancorp Inc. and related subsidiaries on Rating Watch Negative. The action was one of several negative rating actions affecting mortgage-centric companies rated by Fitch. IMB's placement on Watch Negative reflects the unprecedented disruption of the secondary mortgage market, an investor base the company traditional relied on to buy a majority of its mortgage production. IMB has thus far weathered the storm, as short-term secured sources have dried up; the company has systematically reduced reliance on short-term, secured funding by growing deposits and utilizing Federal Home Loan Bank lines. At this point, other than Government Sponsored Enterprises conforming or agency eligible mortgage loans, the market for non-agency loans is severely illiquid. While IMB has been able to sell roughly 70% of its production to the GSEs, this short-term solution is not consistent with the company's strategy of seeking higher spreads from Alt-A products. Historically, IMB had a strong Alt-A market presence and understands that market very well. Fitch believes that IMB can continue to operate by originating and selling conforming production; however, this platform may not be sustainable and could eventually have an impact on performance. Unlike some of its peers which are experiencing liquidity pressure, IMB does not rely heavily on capital markets for funding, and, as a result, was less affected by the recent liquidity squeeze. Also, IMB's business is largely conducted out of Indymac Bank F.S.B and modest holding company leverage. Nonetheless, Fitch believes that other challenges exist such as the ability to execute its strategy amid mortgage market turmoil, absorb higher than expected credit costs and withstand a further decline in California residential real estate prices. Should these challenges manifest quickly and begin to affect performance beyond Fitch's expectations, a ratings downgrade would be likely. Conversely, if the company's seasoned management team and risk management capabilities endure profitability pressures and deteriorating asset quality, the Negative Rating Watch may be resolved without Fitch taking action. Fitch has current ratings as: Indymac Bancorp Inc. -- Long-term Issuer Default Rating 'BBB-'; -- Short-term IDR 'F2'; -- Support floor 'NF'; -- Senior Unsecured Rating 'BBB-'; -- Support Rating '5' (not on Watch Negative) ; -- Individual Rating 'B/C'. Indymac Bank, F.S.B. -- Long-term Issuer Default Rating 'BBB-'; -- Short-term IDR 'F2'; -- Long-term deposits 'BBB'; -- Short-term deposits 'F2'; -- Individual 'B/C'; -- Support Floor '5'; -- Support floor 'NF' (not on Watch Negative). Indymac Capital Trust I -- Trust preferred 'BB+'. INTERSTATE BAKERIES: NCSISA Wants Compensation Liabilities Paid --------------------------------------------------------------- The North Carolina Self-Insurance Security Association relates that Interstate Bakeries Corporation have substantial operations in North Carolina, and have employees engaged in the production, distribution, and retail sale of the its products. Hence, IBC is an "employer" subject to and bound by the North Carolina Workers' Compensation Act, which provides that every employer subject to the Act must secure the payment of its workers' compensation liabilities. The NC Security Association, holder of Claim No. 3260, is an unincorporated, statutory association of North Carolina's self- insured employers created to provide a payment mechanism for the "covered claims" of insolvent member-self-insurer that defaults on its workers' compensation liabilities incurred during its self- insurance period, relates R. Scott Moore, Esq., at Lewis, Rice & Fingersh, L.C., in St. Louis, Missouri. He notes that IBC elected to self-insure its North Carolina workers' compensation liabilities from Nov. 1, 1992, through March 31, 2007. Mr. Moore contends that the termination of the Debtors' self- insurance license has no effect on their obligation to pay their North Carolina workers' compensation liabilities. However, according to the May 30, 2007, loss reserves provided by the Debtors to the NC Security Association, approximately 84% of Debtors' outstanding Compensation Liabilities are postpetition liabilities arising out of postpetition injuries suffered by Debtors' workers. As of their bankruptcy filing, the Debtors' Compensation Liabilities incurred during their Self-Insurance Period are only partially secured by the Travelers Casualty and Surety Company of America Surety Bond No. 30S103730395 for $2,400,000, which is inadequate, Mr. Moore notes. Claim No. 3260 seeks payment for Compensation Liabilities that exceed the partial security. He adds that the Debtors are required to maintain a statutory deposit of at least $4,430,000, which would be equal to 100% of their total undiscounted outstanding claims liability. Pursuant to Section 959(b) of the Judiciary and Judicial Procedures Code and Section 105(a) of the Bankruptcy Code, the NC Security Association asks the United States Bankruptcy Court for the Western District of Missouri to compel the Debtors to submit to the North Carolina Department of Insurance a total statutory deposit of $4,430,000 within 20 days to adequately secure the payment of their Compensation Liabilities. About Interstate Bakeries Headquartered in Kansas City, Missouri, Interstate Bakeries Corporation is a wholesale baker and distributor of fresh-baked bread and sweet goods, under various national brand names, including Wonder(R), Baker's Inn(R), Merita(R), Hostess(R) and Drake's(R). Currently, IBC employs more than 25,000 people and operates 45 bakeries, as well as approximately 800 distribution centers and approximately 800 bakery outlets throughout the country. The company and seven of its debtor-affiliates filed for chapter 11 protection on Sept. 22, 2004 (Bankr. W.D. Mo. Case No. 04-45814). J. Eric Ivester, Esq., and Samuel S. Ory, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP represent the Debtors in their restructuring efforts. When the Debtors filed for protection from their creditors, they listed $1,626,425,000 in total assets and $1,321,713,000 (excluding the $100,000,000 issue of 6.0% senior subordinated convertible notes due August 15, 2014) in total debts. The Debtors' exclusive period to file a chapter 11 plan expires on Oct. 5, 2007. (Interstate Bakeries Bankruptcy News, Issue No. 65; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/ or 215/945-7000). INYX USA: Court Approves Klehr Harrison as Committee's Counsel -------------------------------------------------------------- The Official Committee of Unsecured Creditors of Inyx USA, Ltd. and Exaeris, Inc., obtained permission from the U.S. Bankruptcy Court for the District of Delaware to retain Klehr, Harrison, Harvey, Branzburg & Ellers LLP as its bankruptcy counsel. The Committee, as appointed by the U.S. Trustee for Region 3, is currently composed of Accentia Pharmaceuticals, Ventiv Commercial Services, LLC, and International Union of United Auto Workers. Klehr Harrison, as the Committee's counsel, is expected to: a. assist, advise and represent the Committee in its consultation with the Debtors relative to the administration of the chapter 11 cases; b. assist, advise and represent the Committee in analyzing the Debtors' assets and liabilities, investigating the extent and validity of liens and participating in and reviewing any proposed asset sales or dispositions; c. attend meetings and negotiate with the representatives of the Debtors and secured creditors; d. assist and advise the Committee in its examination and analysis of the conduct of the Debtors' affairs; e. assist the Committee in the review, analysis and negotiation of any plan(s) of reorganization that may be filed and to assist the Committee in the review, analysis and negotiation of the disclosure statement accompanying any plan(s) of reorganization; f. assist the Committee in the review, analysis, and negotiation of any financing or funding agreements; g. take all necessary action to protect and preserve the interests of the Debtors' estates, including, without limitation, the prosecution, and defense, of action on their behalf, negotiations concerning all litigation in which the Debtors are involved, and review and analysis of all claims filed against the Debtors' estates; h. generally prepare and file on behalf of the Committee all necessary motions, applications, answers, orders, reports and papers in support of positions taken by the Committee; i. appear, as appropriate, before the Bankruptcy Court, the Appellate Courts, and other Court in which matters may be heard and to protect the interests of the Committee before these Court ad the U.S. Trustee; and j. perform all other necessary legal services in relation to the Debtors' chapter 11 cases. The Committee discloses that professionals of the firm bill: Hourly Rate ----------- Partners $325 - $600 Associates $205 - $325 Paralegals $120 - $190 The Committee further discloses that the principal attorneys and paralegal at Klehr Harrison designated to represent the Committee and their current hourly rates are: Individual Designation Hourly Rate ---------- ----------- ----------- Joane B. Wills, Esq. Partner $525 Richard M. Beck, Esq. Partner $450 Christopher A. Ward, Esq. Associate $300 Melissa Hughes Paralegal $150 The Committee informs the Court that Klehr Harrison has agreed to a 10% discount on its hourly rates. To the best of the Committee's knowledge, Klehr Harrison does not represent any interest adverse to the Debtors or their estates. About Inyx USA and Exaeris Based in Manati, Puerto Rico, Inyx USA Ltd. operates a pharmaceuticals production center that encompasses five buildings totaling 140,000 square feet and extending over 9.5 acres. Exaeris, Inc., locate din Exton, Pennsylvania, focuses on the strategic commercialization of niche or enhanced pharmaceutical products, marketing and promotion activities. Inyx USA and Exaeris are wholly-owned subsidiaries of Inyx, Inc. (OTC:IYXI) -- http://www.inyxinc.com/-- a specialty pharmaceutical company. Inyx USA and Exaeris filed for chapter 11 protection on July 2, 2007 (Bankr. D. Del. Case Nos. 07-10887 and 07-10888). Anthony M. Saccullo, Esq., at Fox Rothschild, L.L.P., represents the Debtors. When Inyx USA filed for protection from its creditors, it listed estimated assets and debts between $1 million and $100 million. Exaeris estimated its assets were less than $10,000 but debts were between $1 million and $100 million. Stephen S. Gray was appointed as the Chapter 11 Trustee in Inyx USA Ltd.'s bankruptcy proceedings. In Court documents filed by Jack Kachkar, CEO of Inyx, Inc., Inyx USA is indebted to Westernbank Puerto Rico in the approximate amount of $35 million and secured by a first-priority lien in substantially all of Inyx USA's assets. Exaeris has in excess of $5 million in prepetition unsecured obligations outstanding to various creditors. Ashton Pharmaceuticals and Inyx Pharma, the Debtors' UK affiliates, were placed into an involuntary administration on June 29, 2007. Ernst & Young was appointed by the UK court as administrators. JP MORGAN: Fitch Affirms Low-B Ratings on Five Cert. Classes ------------------------------------------------------------ Fitch Ratings has upgraded three classes of JP Morgan Chase Commercial Mortgage Securities Corporation's commercial mortgage pass-through certificates, series 2002-CIBC4 as: -- $24 million class E to 'AA' from 'A+'; -- $12 million class F to 'A' from 'A-'; -- $14 million class G to 'BBB+' from 'BBB'. In addition, Fitch has affirmed these classes: -- $89.5 million class A-2 at 'AAA'; -- $403.2 million class A-3 at 'AAA'; -- Interest-only class X-1 at 'AAA'; -- Interest-only class X-2 at 'AAA'; -- $32 million class B at 'AAA'; -- $34 million class C at 'AAA'; -- $10 million class D at 'AAA'; -- $12 million class H at 'BB+'; -- $4 million class J at 'BB'; -- $6 million class K at 'B+'; -- $8 million class L at 'B'; -- $4 million class M at 'B-'. Fitch does not rate the $5.8 million class NR. Class A-1 has been paid in full. The rating upgrades reflect defeasance and paydown of the pool collateral balance since Fitch's last rating action. As of the August 2007 distribution date the pool has paid down 17.6% to $658.2 million from $798.9 million at issuance. Nineteen loans, 22.2% of the pool, have defeased. There is currently one asset (0.6%) in special servicing, and it is real estate owned. The property is a multi-family building located in Austell, GA. Occupancy was 79% at year end 2006 as a result of the special servicer evicting non-paying tenants. Losses are expected, however, they are anticipated to be fully absorbed by the NR class. Fitch reviewed the credit assessment of the Highland Mall loan (10%). The Highland Mall loan is secured by 487,170 square feet of a regional mall located in Austin, TX. The Fitch stressed DSCR for YE 2006 was 1.45 times, up from 1.42x at YE 2005 and stable with issuance. Occupancy as of YE 2006 was 95% compared to 97.3% at issuance. Due to its stable performance, the loan maintains an investment grade credit assessment. The DSCR for the loan is calculated using borrower provided net cash flow less required reserves divided by debt service payments based on the current balance using a Fitch stressed refinance constant. JR & AR: Involuntary Chapter 11 Case Summary -------------------------------------------- Alleged Debtor: J R & A R Services Inc. 6308 West 89th Street, Suite 260 Los Angeles, CA 90045 Case Number: 07-17214 Involuntary Petition Date: August 20, 2007 Court: Central District Of California (Los Angeles) Judge: Alan M. Ahart Petitioner's Counsel: [not provided] Petitioners Nature of Claim Claim Amount ----------- --------------- ------------ Chris Jordan Secured Promissory $85,000 P.O. Box 7851 Note L.B., CA 90307 KENNETH CROSBY: Voluntary Chapter 11 Case Summary ------------------------------------------------- Debtor: Kenneth James Crosby 308 Maquan Street Hanson, MA 02341 Bankruptcy Case No.: 07-15243 Type of Business: The Debtor filed for Chapter 11 protection on March 21, 2007 (Bankr. D. Mass. Case No. 07-11633). Chapter 11 Petition Date: August 21, 2007 Court: District of Massachusetts (Boston) Judge: Joan N. Feeney Debtor's Counsel: Gary W. Cruickshank, Esq. 21 Custom House Street Suite 920 Boston, MA 02110 Tel: (617) 330-1960 Fax: (617) 330-1970 Estimated Assets: $1 Million to $100 Million Estimated Debts: $1 Million to $100 Million The Debtor did not file a list of its 20 largest unsecured creditors. KINGSLAND GROUP: Involuntary Chapter 11 Case Summary ---------------------------------------------------- Alleged Debtor: The Kingsland Group Inc. 160 East 56th Street, 5th Floor New York, NY 10022 Case Number: 07-12642 Type of Business: The Debtor is a real estate development company. Involuntary Petition Date: August 20, 2007 Court: Southern District of New York (Manhattan) Petitioner's Counsel: Tracy L. Klestadt, Esq. Klestadt & Winters, L.L.P. 292 Madison Avenue, 17th Floor New York, NY 10017-6314 Tel: (212) 972-3000 Fax: (212) 972-2245 Petitioners Nature of Claim Claim Amount ----------- --------------- ------------ Joremi Enterprises, Inc. breach of contract $3,000,000 1775 Broadway, Suite 532 New York, NY 10019 M. Salvioli Trust promissory note and $1,534,159 P.O. Box 7444 unrecorded mortgage Daytona Beach, FL 32116 Larry Frank breach of contract $1,200,000 127 Buckskin Lane Ormond Beach, FL 32174 Louis P. Samuels Revocable breach of contract $1,315,400 Trust 3000 North Atlantic Avenue Daytona Beach, FL 32118 Judith P. Karges breach of contract $1,180,000 2062 South Halifax Drive Daytona Beach, FL 32118 Richard G. Rogers breach of contract $700,000 577 Pelican Bay Drive Daytona Beach, FL 32119 LANDAMERICA FINANCIAL: S&P Holds BB+ Rating on Subordinated Debt ---------------------------------------------------------------- Standard & Poor's Ratings Services revised its outlook on LandAmerica Financial Group Inc. and LFG's title insurance subsidiaries to negative from stable. At the same time, Standard & Poor's affirmed its 'BBB-' counterparty credit rating and senior debt rating on LFG and affirmed its 'A-' counterparty credit and financial strength ratings on LandAmerica. In addition, Standard & Poor's affirmed LFG's preliminary 'BB+' subordinated debt and 'BB' preferred stock ratings. "The revised outlook reflects the challenging environment for all title insurers," explained Standard & Poor's credit analyst James Brender. "We believe mortgage originations will decline steadily between 2006 and 2009." Consequently, operating performance for title insurers will be strained for at least the next six quarters. LandAmerica's adjusted pretax profit margin is unlikely to exceed 5% in 2007 or 2008. The ratings on LandAmerica are based on the group's strong competitive position, strong capitalization of title insurance companies and good operating performance. Offsetting the company's strengths is the challenging environment for the title insurance industry. LandAmerica also has a higher expense ratio than its peers and limited product diversification. LandAmerica has stabilized its strong competitive position. After falling to 18% in 2003 from 22% in 2001, the company's market share recovered to 19% in the first quarter of 2007. The primary drivers of the market share loss were industry consolidation, setbacks in implementing new technology, and the company's lower concentration of revenue in California and Florida. LandAmerica is firmly entrenched as the third-largest title insurer. The group has the best geographic dispersion among the five major title insurance groups with the top five states constituting 49% of its revenue. The decline in mortgage originations and rising claim costs caused significant deterioration in all title insurers' recent operating results. LandAmerica's adjusted title margins for the first half of 2007 were only 4% compared with 12% for 2003. Both components of the combined ratio increased since 2004. However, operating results are consistent with the rating when measured over the mortgage market's full cycle. Standard & Poor's does not expect dramatic changes from increased scrutiny to the title insurance industry, though some deterioration in margin is possible. The intensified monitoring began in early 2005, when California Insurance Commissioner John Garamendi announced that he was investigating captive-reinsurance arrangements between title insurers and lenders, builders, and realtors. These investigations led to a settlement of $7 million with several states. LandAmerica also paid $10 million for a class-action lawsuit settlement related to pricing. LFG has limited product diversification. Statutory guidelines prevent LandAmerica from providing products other than title insurance and escrow services. The holding company has built the infrastructure and product line to create a stream of nonregulated income that is less dependent on mortgage originations, but these units have not fully established their competitive position. In the past three years, LFG has acquired nontitle companies, such as tax services and flood warrants. Since LandAmerica does not own these companies, it will not directly benefit from any earnings they generate, but their growth would improve LFG's financial flexibility and liquidity. These products are related to the housing and mortgage markets. The outlook is negative. If LandAmerica is unable to adjust its cost structure to at least partially offset the anticipated decline in revenue, Standard & Poor's would lower the group's financial strength rating by one notch. Conversely, S&P would revise the outlook to stable if LandAmerica demonstrates it can maintain profit margins in the low to mid single digits in the short term and return to double-digit profit margins when the next cycle's peak occurs. Standard & Poor's expects that LandAmerica will maintain its market position as the third-largest domestic title insurer. Management's primary objective will be to cut costs in its title operations. However, they will devote some resources to building the nontitle segments and pursuing minor acquisitions. M/I HOMES: Weak Market Cues S&P to Lower Credit Rating to BB- ------------------------------------------------------------- Standard & Poor's Ratings Services lowered its corporate credit, senior unsecured debt, and preferred stock ratings on M/I Homes Inc. S&P lowered the corporate and senior unsecured ratings to 'BB-' from 'BB' and lowered the preferred stock rating to 'B-' from 'B'. The outlook remains negative. The rating actions affect $200 million of senior unsecured notes and $100 million of preferred stock. "The rating actions reflect continued weakness in the company's Midwest and Florida housing markets where M/I's operations are concentrated, which is putting greater stress on profitability and interest coverage beyond previous expectations and will weigh on the company's performance over an extended period of time," said credit analyst Tom Taillon. "Credit tightening in the mortgage market, higher-than-expected pricing concessions, and continued inventory overhang are weighing heavily on both M/I's operations and key credit metrics; it is likely that without a modification to the existing credit agreement, the company will violate the existing interest coverage covenant under its credit facility. However, we believe M/I will pursue certain actions to remain in compliance with its debt covenants through 2008 and continue a prudent defensive financial strategy." S&P expect very challenging market conditions to place continued stress on M/I's operations, resulting in reduced profit margins and weak interest coverage. S&P would lower the rating an additional notch if deteriorating market conditions negatively affect M/I's ability to liquidate inventory and generate cash and liquidity becomes further constrained. However, S&P would revise the outlook to stable at the existing rating if the housing market stabilizes and key cash flow coverage metrics improve, and adequate liquidity is maintained. MARCO GUTIERREZ: Case Summary & 19 Largest Unsecured Creditors -------------------------------------------------------------- Debtors: Marco Antonio Gutierrez Jennifer Gutierrez 3985 Bolinas Place Discovery Bay, CA 94514 Tel: (510) 205-0986 Bankruptcy Case No.: 07-42634 Chapter 11 Petition Date: August 20, 2007 Court: Northern District of California (Oakland) Judge: Leslie J. Tchaikovsky Debtors' Counsel: Mufthiha Sabaratnam, Esq. Law Offices of Sabaratnam and Assoc. 1300 Clay Street, Suite 600 Oakland, CA 94612 Tel: (510) 464-8000 Total Assets: $6,509,200 Total Debts: $6,023,238 Debtors' List of its 19 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Internal Revenue Service $194,562 1301 Clay Street Oakland, CA 94612 Washington Mutual Bank 2nd Mortgage $152,000 P.O. Box 78065 Secured: Phoenix, AZ 85062-8065 $600,000 Unsecured: $152,000 Tulare County Recorder Judgment $98,701 County Civic Center Visalia, CA 93291 Sacramento County Recorder $98,701 Contra Costa City Recorder Judgment $46,147 Antioch Schools FCU Auto Loan $41,166 Jonshon, Morgan & White Office Rent $29,409 Madera County Recorder Judgment $27,432 Contra Costa City Recorder Judgment $26,797 Antioch Community Credit Union $85,069 Secured: $70,000 Unsecured: $15,069 Sallie Mae $13,790 Washington Mutual Bank Mortgage Loan $607,385 Secured: $600,000 Unsecured: $7,385 Chase Bank/Legal Department Judgment $60,049 PG&E Utilities $3,825 RMS Telephone $2,343 Credit Collection Services $2,010 Bank of America Credit Card $1,932 Antioch Schools FCU 2002 BMW 745 $32,858 Secured: $32,000 Unsecured: $858 Delta Municipal Court Judgment $800 MAYWOOD CONSOLIDATED: Court Sets Sept. 28 Claims Filing Deadline ---------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York established Sept. 28, 2007, as the deadline for all persons or entities owed money by Maywood Consolidated Properties Inc. and its debtor-affiliates to file their proofs of claims. Proofs of claims must be received no later than 5:00 pm, Eastern Time, on the bar date by the United States Bankruptcy Court for the Southern District of New York, at Room 534, One Bowling Green, in New York City. Headquartered in New York City, Maywood Consolidated Properties Inc. acquires, owns, operates and develops real property. The company and its affiliates filed for chapter 11 protection on February 19, 2005 (Bankr. S.D.N.Y. Case No. 05-10986). Wayne M. Greenwald, Esq. at Wayne M. Greenwald, P.C. serves as the Debtors' counsel. Maywood Consolidated Properties did not list total assets but reported total debts of $4,338,004 when it sought protection from its creditors. MEDICAL SOLUTIONS: June 30 Balance Sheet Upside-Down by $2.2 Mil. ----------------------------------------------------------------- Medical Solutions Management Inc.'s consolidated balance sheet at June 30, 2007, showed $3.1 million in total assets and $5.3 million in total liabilities, resulting in a $2.2 million total stockholders' deficit. The compay's consolidated balance sheet at June 30, 2007, also showed strained liquidity with $3.0 million in total current assets available to pay $5.3 million in total current liabilities. The company reported a net loss of $11.3 million and an operating loss of $1.0 million, on total revenue of $784,185 for the second quarter ended June 30, 2007, compared with a net loss of $1.6 million and an operating loss of $806,739, on total revenue of $253,502 for the same period ended July 1, 2006. Revenue increased in the three months ended June 30, 2007, primarily due to the increase in the number of clinics under agreement with the company from 18 in the second quarter of 2006 to 46 in the second quarter of 2007. The decrease in operating loss during the quarter ended June 30, 2007, is principally due to an increase in gross profit as a result of the increase in total revenue, partly offset by an increase in selling, general and administrative expenses incurred to continue to grow revenue and support operations. Interest expense was $259,778 including aggregate amortization of discount of $177,602 on the convertible note payable issued to Vicis on June 28, 2006, and the convertible note payable issued to Vicis and Apogee on April 17, 2007. This compares withe interest expense of $791,972 for the same period ended July 1, 2006. The significant increase in net loss for the three months ended June 30, 2007, was primarily attributable to non-cash charges of approximately $10.0 million for the estimated fair value of warrants to purchase an aggregate of 3,213,000 shares of the company's stock at $1.00 per share, issued pursuant to an amended Guarantee Fee, Reimbursement and Indemnification Agreement, in connection to the company's increase in its Revolving Line of Credit Agreement with Sovereign Bank from $1,500,000 to $3,000,000. Full-text copies of the company's consolidated financial statements for the the quarter ended June 30, 2007, are available for free at http://researcharchives.com/t/s?22ce Going Concern Doubt Michael F. Cronin, CPA, in Rochester, New York, expressed substantial doubt about Medical Solutions Management Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements as of the year ended Dec. 31, 2006. Mr Cronin reported that the company's losses have resulted in an accumulated deficit of $4.7 million as of Dec. 31, 2006, and 2006 operating activities consumed $2.9 million in cash. The company's losses have resulted in an accumulated deficit of approximately $37.2 million as of June 30, 2007. Operating activities consumed approximately $3.6 million in cash in the six months ended June 30, 2007. In addition, the company has negative working capital of approximately $2.3 million as of June 30, 2007. About Medical Solutions Headquartered in Marlborough, Massachusetts, Medical Solutions Management Inc. (OTC BB: MSMT.OB) -- through its wholly-owned subsidary and operating company OrthoSupply Management Inc., is a provider of orthopedic and podiatric durable medical equipment, specializing in the provision of products and services using the company's turnkey program. Through this turnkey program, the company enables orthopedic and podiatric practices to dispense an array of durable medical equipment directly to their patients during office visits. The system, which is transportable to other types of medical practices, also provides billing and collection services, inventory management and insurance verifications. MEDICOR LTD: Court Okays Greenberg Traurig as Delaware Counsel -------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware gave Medicor Ltd. and its debtor-affiliates' authority to employ Greenberg Traurig, LLP as their Delaware counsel. As the Debtors' local counsel, Greenberg Traurig is expected to: (a) provide legal advice with respect to the Debtors' powers and duties as debtors and debtors-in-possession in the continued management and operation of their business and properties; (b) negotiate, drat and pursue confirmation o any plan o reorganization and approval of any accompanying disclosure statement; (c) prepare on behalf of the Debtors all motions, applications, answers, orders, reports and papers and other legal papers necessary to the administration of the estates; (d) appear in Court and protect the interests of the Debtors' estates before the Courts; (e) assist with any disposition of the Debtors' assets, by sale or otherwise; (f) attend all meetings and negotiate with representative of creditors, the U.S. Trustee, and other parties-in-interest; and (g) perform all other legal services or, and provide all other necessary legal advice to, the Debtors' as may be necessary and proper in their cases. The Debtors discloses that pricipal attorneys and paralegals who will represent the Debtors and their hourly rates are: Victoria W. Counihan, Esq. $475 Diane E. Vuocolo, Esq. $425 Dennis A. Meloro, Esq. $360 Elizabeth Thomas $190 To the best of the Debtors' knowledge, the firm does not represent any interest adverse to them or their estates. Headquartered in North Las Vegas, Nevada, MediCor Ltd. -- http://www.medicorltd.com/-- acquires, develops, manufactures and markets products primarily for aesthetic, plastic and reconstructive surgery and dermatology markets. The company and seven of its affiliates filed for chapter 11 protection on June 29, 2007 (Bankr. D. Del. Case No. 07-10877) to effectuate the orderly marketing and sale of their business. Kenneth A. Rosen, Esq., Jeffrey D. Prol, Esq., and Jeffrey A. Kramer, Esq., at Lowenstein Sandler PC represent the Debtors in their restructuring efforts. Dennis A. Meloro, Esq., and Victoria Watson Counihan, Esq., at Greenberg Traurig, LLP, acts as the Debtors' Delaware counsel. The Debtors engaged Alvarez & Marsal North America LLC as their restructuring advisor. David W. Carickhoff, Jr., Esq., and Jason W. Staib, Esq., at Blank Rome LLP serve as the Official Committee of Unsecured Creditor's counsel. In its schedules of assets and debts filed with the Court, Medicor disclosed total assets of $96,553,019, and total debts of $158,137,507. The Debtors' exclusive period to file a chapter 11 plan expires on Oct. 27, 2007. MERRILL LYNCH: Stable Performance Cues Fitch to Affirm Ratings -------------------------------------------------------------- Fitch Ratings affirms Merrill Lynch Mortgage Trust 2005-CIP1, commercial mortgage pass-through certificates as: -- $57.9 million class A-1 at 'AAA'; -- $533.8 million class A-2 at 'AAA'; -- $157.9 million class A-3A at 'AAA'; -- $50.0 million class A-3B at 'AAA'; -- $108.0 million class A-SB at 'AAA'; -- $510.3 million class A-4 at 'AAA'; -- $205.6 million class AM at 'AAA'; -- $138.8 million class AJ at 'AAA'; -- Interest-only class XC at 'AAA'; -- Interest-only class XP at 'AAA'; -- $43.7 million class B at 'AA'; -- $17.9 million class C at 'AA-'; -- $38.5 million class D at 'A'; -- $25.7 million class E at 'A-'; -- $33.4 million class F at 'BBB+'; -- $20.5 million class G at 'BBB'; -- $25.7 million class H at 'BBB-'; -- $10.2 million class J at 'BB+'; -- $5.1 million class K at 'BB'; -- $7.7 million class L at 'BB-'; -- $7.7 million class M at 'B+'; -- $5.1 million class N at 'B'; -- $5.1 million class P at 'B-'; -- $25.7 million class Q at 'NR'. The $25.7 million class Q certificate is non-rated by Fitch. The rating affirmations reflect the minimal reduction of the pool collateral balance and stable performance since issuance. The pool has paid down 1.06%, to $2.03 billion from $2.05 billion at issuance as of the August 2007 distribution date. There are currently no delinquent or specially serviced loans. Three loans, Financial Square (6.4%), The Westchester (4.9%), and E Walk on the new 42nd Street (3.8%) maintain investment grade credit assessments, based on stable performance and improved occupancy since issuance. Financial Square is a 1,030,053 square foot class A office property in New York City. Year-end 2006 occupancy improved to 92.3% compared to 70% at issuance. The Westchester, a 831,841 sf retail property in White Plains, New York and is anchored by Nordstrom and Neiman Marcus. Occupancy has improved to 98% as of YE 2006 compared to 96.3% at issuance. E Walk on the New 42nd Street, a 177,394 sf anchored retail strip in the Times Square section of New York City. The property is anchored by Loew's Theatres and has Chevys, Viacom, and BB King Blues Club as major tenants. Occupancy has increased to 99.7% as of YE 2006 from 96% at issuance. MILA INC: Judge Steiner Okays Crocker Kuno as Committee's Counsel ----------------------------------------------------------------- The Hon. Samuel J. Steiner of the U.S. Bankruptcy Court for the Western District of Washington gave the Official Committee of Unsecured Creditors of MILA Inc. permission to retain Crocker Kuno Ostrovsky LLC as its bankruptcy counsel. The Committee, appointed by the U.S. Trustee for Region 18 on July 20, 2007, is composed of Navigant Capital Advisors, DLJ Mortgage Capital Inc./Credit Suisse First Boston Mortgage Capital, LLLC, and Risk Management CitiMortgage, Inc. As the Committee's counsel, Crocker Kuno is expected to: a. give the Committee legal advices with respect to its powers, duties and responsibilities in the Debtor's chapter 11 case; b. assist the Committee in the investigation of the acts, conduct, assets, liabilities and financial condition of the Debtor and its principals, the operation of the Debtor's business and the desirability of the continuation of the business, and any other matters relevant to the case or formulation of a plan of reorganization; c. assist the Committee in negotiations with the Debtor and in the formulation of a plan of liquidation; and d. perform other legal services as may be required and in the best interest of unsecured creditors. The Committee discloses that professionals of the firm bill: Designation Hourly Rate ----------- ----------- Partners $295 - $350 Associates $210 - $260 Paralegal $140 Bankruptcy Assistant $85 To the best of the Committee's knowledge, the firm is a "disinterested person" as defined in Section 101(14) of the Bankruptcy Code. About MILA Inc. Based in Mountlake Terrace, Washington, M.I.L.A. Inc., dba Mortgage Investment Lending Associates -- http://www.mila.com/-- is an e-commerce mortgage solutions provider who utilizes AccessPoint, a proprietary e-commerce portal, to help mortgage brokers, realtors and bankers fulfill customized residential home loans. The company filed for Chapter 11 protection on July 2, 2007 (Bankr. W.D. Wash. Case No. 07-13059). Christine M. Tobin, Esq. and James L. Day, Esq., at Bush, Strout, & Kornfeld, represent the Debtor in its restructuring efforts. The Court appointed Geoffrey Groshong as chapter 11 trustee on July 6, 2007. Mr. Groshong is represented by David W. Hercher, Esq., at Miller Nash LLP. When the Debtor filed for protection from its creditors, it listed total assets of $7,886,962, and total liabilities of $174,730,413. The Debtor's exclusive period to file a chapter 11 plan expires on Oct. 30, 2007. MUSICLAND HOLDING: Bank Wants Vendors Rule 2019 Statement Filed --------------------------------------------------------------- Wachovia Bank, National Association, asks the U.S. Bankruptcy Court for the Southern District of New York to compel the Informal Committee of Secured Trade Vendors of Musicland Holding Corp. and its debtor-affiliates' to file a verified statement pursuant to Rule 2019 of the Federal Rules of Bankruptcy Procedures. Wachovia complains that the Informal Committee has never fully complied with the Rule 2019 disclosure requirements even if its multiple counsel has filed separate Rule 2019 statements. Wachovia explains that the Informal Committee's composition has changed significantly. The Committee admittedly represents the collective interests of a changing group currently comprising at least seven different creditors and has held itself out as a "committee" throughout the bankruptcy proceedings, Wachovia relates. The Committee, therefore, must comply with the clear and unambiguous requirements of Rule 2019(a), Wachovia asserts. Wachovia further reminds the Court that Rule 2019(a) requires "a committee representing more than one creditor" to file a verified statement setting forth the name and address of each creditor; the nature and amount of the claim or interest; the time when each creditor acquired the interest; the amount paid by each creditor for that interest; and any sale or other disposition of the interest. Rule 2019(a) also requires the disclosure of any instrument empowering a committee to act on behalf of its members and the prompt filing of a supplemental statement reporting "any material changes in the facts" underlying a filed statement. Wachovia also notes that the Bankruptcy Court for the Southern District of New York has required an ad hoc committee of equity security holders in In re Northwest Airlines Corp., 363 B.R. 701 (Bankr. S.D.N.Y. 2007). Wachovia tells Judge Bernstein that the Informal Committee was originally composed of a group of trade vendors who supplied audio and video related products to the Debtors under a security agreement. In late June 2006, certain trade members apparently sold their interests to various funds that have never disclosed the amount each Fund paid for its interest. The Informal Committee has continued to appear in the Debtors' cases, replaced Morgan Lewis & Bockius LLP as the panel's counsel, and retained Paul Weiss Rifkind Wharton & Garrison as its new counsel. Wachovia, together with Harris N.A., is the target of a lawsuit commenced by the Informal Committee in January 2007 for breach of contract, tortious interference with contractual relations, conversion, and unjust enrichment, based on a $25,000,000 term loan Harris made to Musicland in the fall of 2005, which was paid in full in December 2005. The lawsuit was initially filed before the U.S. District Court for the Southern District of New York, and was later dismissed and re-filed in the Bankruptcy Court. According to papers filed in Bankruptcy Court, the plaintiffs in the Complaint are Buena Vista Home Entertainment, Inc., Cargill Financial Services International, Inc., Hain Capital Group, LLC, Paramount Pictures Corporation, Twentieth Century Fox Home Entertainment LLC, UBS Willow Fund, LLC, and Varde Investment Partners, L.P. The Hon. Stuart Bernstein of the U.S. Bankruptcy Court for the Southern District of New York adjourns the hearing to consider confirmation of Musicland Holding Corp. and its debtor-affiliates' Second Amended Joint Plan of Liquidation to Sept. 27, 2007, Andrea L. Johnson, Esq., at Kirkland & Ellis LLP, in New York, notifies all interested parties. About Musicland Headquartered in New York, New York, Musicland Holding Corp., is a specialty retailer of music, movies and entertainment-related products. The Debtor and 14 of its affiliates filed for chapter 11 protection on Jan. 12, 2006 (Bankr. S.D.N.Y. Lead Case No. 06-10064). James H.M. Sprayregen, Esq., at Kirkland & Ellis, represents the Debtors in their restructuring efforts. Mark T. Power, Esq., at Hahn & Hessen LLP, represents the Official Committee of Unsecured Creditors. At March 31, 2007, the Debtors disclosed $20,121,000 in total assets and $321,546,000 in total liabilities. On May 12, 2006, the Debtors filed their Joint Plan of Liquidation with the Court. On Sept. 14, 2006, they filed an amended Plan and a Second Amended Plan on Oct. 13, 2006. The Court approved the adequacy of the Amended Disclosure Statement on Oct. 13, 2006. (Musicland Bankruptcy News, Issue No. 36; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) MUSICLAND HOLDING: LSTA & SIFMA Denounce Wachovia's 2019 Motion --------------------------------------------------------------- The Loan Syndications and Trading Association and the Securities Industry and Financial Markets Association ask the U.S. Bankruptcy Court for the Southern District of New York for leave, as amici curiae, to file an opposition to Wachovia Bank's request to compel the Informal Committee of Secured Trade Vendors of Musicland Holding Corp. and its debtor-affiliates' to file a Rule 2019 Verified Statement disclosing the nature and the amount of the Informal Committee members' claims. Andrew N. Goldman, Esq., at Wilmer Cutler Pickering Hale and Dorr LLP in New York, asserts that the 2019 Motion will have detrimental impacts on the liquidity of the active and vibrant trading markets as well as the willingness and ability of many stakeholders to participate in future chapter 11 cases. Wachovia's 2019 Motion goes beyond the practical and seeks public disclosure of a market participant's most confidential and proprietary information like the price at which the institution purchased or sold its claims. The LSTA and SIFMA intend to file an Amicus Brief and make oral argument with respect to Section 1109(b) of the Bankruptcy Code. Alternatively, the LSTA and SIFMA ask for leave to file the Amicus Brief and make oral arguments pursuant to Bankruptcy Rule 2018, which provides that "after hearing on such notice as the court directs and for cause shown, the court may permit any interested entity to intervene . . . with respect to any specified matter," and the Court's broad equitable powers under Section 105 of the Bankruptcy Code. In their Amicus Brief, the LSTA and SIFMA assert that requiring members of Informal Committee to make Rule 2019 disclosures will reveal not only their holdings but the prices at which these entities purchased their securities. This will compromise the Debtors' negotiating process vital to the restructuring. The LSTA and SIFMA also point out that Rule 2019 does not apply to informal groups like the Informal Committee because they do not act as fiduciaries. Mr. Goldman argues that Wachovia's point lack merit. No legitimate purpose is served by requiring the Informal Committee to tell the world the dates and prices at which each member acquired its position. About LSTA The Loan Syndications and Trading Association is the trade association for all segments of the floating rate corporate loan market. With more than 220 members, including broker-dealers, commercial banks, investment banks, mutual funds, merchant banks, and other major financial organizations worldwide, the LSTA seeks to foster the development of policies and market practices designed to promote just and equitable marketplace principles and to encourage cooperation and coordination with firms facilitating transactions in loans and related claims. About SIFMA The Securities Industry and Financial Markets Association is the organization formed from the 2006 merger of the Bond Market Association and the Securities Industry Association. SIFMA brings together the shared interests of more than 650 securities firms, banks, and asset managers active in U.S. and foreign markets. The SIFMA's mission is to promote policies and practices that work to expand and perfect markets, foster the development of new products and services, and create efficiencies for member firms, while preserving and enhancing the public's trust and confidence in the markets and the industry. About Musicland Headquartered in New York, New York, Musicland Holding Corp., is a specialty retailer of music, movies and entertainment-related products. The Debtor and 14 of its affiliates filed for chapter 11 protection on Jan. 12, 2006 (Bankr. S.D.N.Y. Lead Case No. 06-10064). James H.M. Sprayregen, Esq., at Kirkland & Ellis, represents the Debtors in their restructuring efforts. Mark T. Power, Esq., at Hahn & Hessen LLP, represents the Official Committee of Unsecured Creditors. At March 31, 2007, the Debtors disclosed $20,121,000 in total assets and $321,546,000 in total liabilities. On May 12, 2006, the Debtors filed their Joint Plan of Liquidation with the Court. On Sept. 14, 2006, they filed an amended Plan and a Second Amended Plan on Oct. 13, 2006. The Court approved the adequacy of the Amended Disclosure Statement on Oct. 13, 2006. (Musicland Bankruptcy News, Issue No. 36; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) NATIONAL BANK: Moody's Affirms "B-" Financial Strength Rating ------------------------------------------------------------- Moody's Investors Service affirmed the ratings and outlook of National Bank of Canada (bank financial strength rating at B-, long-term deposits at Aa2). The rating action follows NBC's announcement that the bank would acquire CDN$2 billion of non-bank administered, asset-backed commercial paper held in mutual funds and pooled funds of subsidiaries of the bank, as well as ABCP held by other of the bank's investing clients. Moody's affirmed NBC's ratings because any losses accruing to the bank as a result of bringing this exposure on-balance-sheet are very likely to be well-below one-year's pre-tax, pre-provision earnings. Moreover, Moody's does not expect the impact of any such loss on the bank's capital ratios will be material. In affirming NBC's ratings, Moody's raised two concerns. First, by acquiring CDN$2 billion in assets whose value could deteriorate measurably in the months ahead, NBC could sustain a deterioration in earnings, efficiency, and capital ratios just prior to a negative turn in the credit cycle, leaving the bank's financial strength more susceptible to other stresses. Second, allowing its proprietary mutual funds to build sizable concentrations in the non-bank administered, ABCP asset class raises concerns with NBC's enterprise risk management, which Moody's has historically viewed as quite strong. Moody's noted that NBC's ratings could ultimately be downgraded if the losses related to the ABCP exposure meaningfully exceed two- quarter's earnings and if Moody's determines that these or other events expose weaknesses in the bank's risk management practices not presently incorporated in NBC's bank financial strength rating. National Bank of Canada, headquartered in Montreal, Quebec, Canada, reported total assets of about CDN$137 billion, and total common equity of CDN$4.6 billion as of April 30, 2007. NEW RIVER: Disclosure Statement & Plan Hearing Set for October 1 ---------------------------------------------------------------- The United States Bankruptcy Court for the Southern District of Florida will convene a hearing on Oct. 1, 2007, at 1:30 p.m., to consider approval of New River Dry Dock Inc. and it's debtor- affiliates' Disclosure Statement, as well as confirmation of the Debtors' Chapter 11 Plan of Liquidation. Under the Plan, Mary Wickman will serve as the Debtor's plan administrator. Ms. Wickman is expected to hold, liquidate, collect and distribute the Debtor's assets to its creditors. On April 25, 2007, the Court approved the sale of the Debtor's drydock property to SKID LLC and SKID-SPVEC LLC for $12,250,000. The Debtor said that it paid $10,749,934 for it's secured debt and $28,894 for taxes. The Debtor has approximately $749,934 in excess sale proceeds, which will be used to fund, in part, the Plan. Treatment of Claims Under the Plan, Administrative Claims will be paid 100% without interest on the effective date. Priority Claims will also be paid in full in cash from the available funds by Ms. Wickman on the distribution date. General Unsecured Claims will be paid on a pro rata basis, including interest rate at 8% per annum. The Debtor tells the Court that the unsecured creditors holds $2,7000,208, of which $1,166,180 are insider claims. Holders of Equity Interests will be paid after all valid claims have been paid in full and holders will retain their equity. A full-text copy of the New River's Disclosure Statement and Plan of Liquidation is available for a fee at: http://www.researcharchives.com/bin/download?id=070822032518 Headquartered in Fort Lauderdale, Florida, New River Dry Dock, Inc., filed for chapter 11 protection on July 18, 2006 (Bankr. S.D. Fla. Case No. 06-13274). James H. Fierberg, Esq., at Berger Singerman, P.A., represents the Debtor in its restructuring efforts. Mindy A. Mora, Esq., at Bilzin Sumberg Baena Price & Axelrod LLP represents the Official Committee of Unsecured Creditors. When the Debtor filed for protection from its creditors, it estimated assets between $10 million and $50 million and its debts between $1 million to $10 million. NEW YORK RACING: Bankruptcy May Continue Until Mid-2008 ------------------------------------------------------- The New York Racing Association's bankruptcy case may continue until mid-2008 even if it manages to retain the franchise to run the Saratoga Race Course, Belmont Park, and Aqueduct, Paul Post of the Associated Press reports citing NYRA President Charles Hayward. This, according to Mr. Hayward, is due to the fact that it would take that long to work out a chapter 11 plan of reorganization and have it confirmed by the bankruptcy court. Franchise Issue The Debtor's franchise to conduct racing and operating pari-mutual wagering on its racetracks is scheduled to expire on Dec. 31, 2007. According to Mr. Post, the Debtor alleges that top officials, including former Governor George Pataki, were the cause of the operators downfall in their bid to get control of the three racetracks. The report further relates that Governor Eliot Spitzer is currently reviewing updated business plans from NYRA, Excelsior Racing Associates, Empire Racing Associates and Capital Play Inc. Governor Spitzer intends to recommend a franchisee by Sept. 4, 2007 but his choice however, will still need approval from state lawmakers. Racing Law According to Mr. Hayward, AP reports, the current racing law has to be rewritten in order for whoever becomes the franchise owner to retain earnings. Under the law, Mr. Hayward says, NYRA is not allowed to retain its earnings and thus also led to its poor financial condition. About New York Racing Based in Jamaica, New York, The New York Racing Association Inc. aka NYRA -- http://www.nyra.com/-- operates racing tracks in Aqueduct, Belmont Park and Saratoga. The company filed for chapter 11 protection on Nov. 2, 2006 (Bankr. S.D.N.Y. Case No. 06-12618). Brian S. Rosen, Esq., at Weil, Gotshal & Manges LLP, Henry C. Collins, Esq., at Cooper, Erving & Savage LLP, and Irena M. Goldstein, Esq., at Dewey Ballantine LLP represent the Debtor in its restructuring efforts. Jeffrey S. Stein of The Garden City Group Inc. serves as the Debtor's claims and noticing agent. Edward M. Fox, Esq., Eric T. Moser, Esq., Jeffrey N. Rich, Esq., at Kirkpatrick & Lockhart Preston Gates Ellis LLP, represent the Official Committee of Unsecured Creditors. When the Debtor sought protection from its creditors, it listed more than $100 million in total assets and total debts. The Debtor's exclusive period to file a chapter 11 plan expires on Nov. 15, 2007. NOMURA ASSET: Fitch Affirms Low-B Ratings on Two Cert. Classes -------------------------------------------------------------- Fitch Ratings upgraded Nomura Asset Securities Corp.'s commercial mortgage pass-through certificates, series 1998-D6, as: -- $37.2 million class B-2 to 'A+' from 'A-'; and -- $37.2 million class B-3 to 'BBB+' from 'BBB'. In addition, Fitch affirms these classes: -- $1.6 billion class A-1B at 'AAA'; -- $382.7 million class A-1C at 'AAA'; -- Interest-only class PS-1 at 'AAA'; -- $223.4 million class A-2 at 'AAA'; -- $204.8 million class A-3 at 'AAA'; -- $167.5 million class A-4 at 'AAA'; -- $55.8 million class A-5 at 'AAA'; -- $18.6 million class B-5 at 'B'; and -- $27.9 million class B-6 at 'B-'. Class A-1A has paid in full. Fitch does not rate the interest-only class A-CS1, $158.2 million class B-1, the $65.2 million class B-4, the $15.8 million class B- 7, or the and $339 B-7H certificates. The upgrades are attributable to the additional defeasance of 10% and paydown of 4.6% of the transaction since Fitch's last rating action. Ninety one loans (40.8%) have fully defeased since issuance, including the second largest loan in the pool, Park LaBrea (4.3%). In addition, two loans are partially defeased (0.33%). As of the August 2007 distribution date, the pool has paid down 19.0% to $3.0 billion from $3.72 billion at issuance. There is currently one asset in special servicing. The specially serviced asset is a 58,317 square foot retail shopping center in Maryville, TN. The center is Real Estate Owned and is under contract for sale. The asset was originally secured by three properties, the other two have been sold. There are expected losses, which will be fully absorbed by the non-rated B-7 and B-7H classes. The transaction includes six credit assessed loans. Three of them are fully defeased; The Bristol French Quarter (3.9%), Summerfield Suites / Innkeepers (1.1%), and Westin Casaurina Resort (0.5%). Fitch reviewed servicer-provided financial statements and other performance information for the remaining non-defeased credit assessed loans: Fox Plaza (5.2%), Westminster / Burnham-Pacific (4.1%), and Morris Corporate Center (1.1%). The debt service coverage ratios for the loans are calculated based on a Fitch adjusted net cash flow and a stressed debt service based on the current loan balances and a hypothetical mortgage constant. All of the remaining non-defeased credit assessed loans are considered investment grade. The Fox Plaza loan (5.2%), the largest loan in the pool, is collateralized by a 710,767 square foot office building in Century City, CA. Occupancy had decreased to 87.3% as of May 2007 compared to 91.0% at issuance. The Westminster / Burnham-Pacific pool (3.9%) is collateralized by 18 cross-collateralized and cross-defaulted anchored community shopping centers located throughout California. At issuance, the collateral consisted of 19 centers, but one center was released from the trust in 2004. The Fitch-stressed DSCR for Year-End 2006 was 2.33x, compared to 1.61x at issuance. The Morris Corporate Center loan (1.1%) is collateralized by two multi-tenant suburban office buildings with 521,700 sf located in Parsippany, NJ. The YE 2006 Fitch-stressed DSCR was 2.07x compared to 1.83x at issuance. Occupancy as of July 2007 had decreased to 77.1% from 81.7% at issuance. NOVASTAR ABS: Fitch Cuts Rating on $15.7MM Class D Notes to "BB" ---------------------------------------------------------------- Fitch affirmed one class and downgraded four classes of notes issued by NovaStar ABS CDO I, Ltd and NovaStar ABS CDO I, Inc co- issuer. The rating actions are: -- $243,700,000 class A-1 notes affirmed at 'AAA'; -- $34,900,000 class A-2 notes downgraded to 'AA' from 'AAA' and place on Rating Watch Negative; -- $28,500,000 class B notes downgraded to 'A+' from 'AA' and place on Rating Watch Negative; -- $24,400,000 class C notes downgraded to 'BBB' from 'A' and place on Rating Watch Negative; -- $15,700,000 class D notes downgraded to 'BB' from 'BBB' and remain on Negative Rating Watch. NovaStar I is a collateralized debt obligation that closed Feb. 8, 2007, and is managed by NovaStar Asset Management Company. The collateral supporting the CDO is composed of a portfolio of nearly 100% subprime residential mortgage-backed securities, issued between 2005 and 2007. The downgrade of the class A-2, B, C and D notes is the result of continued deterioration of portfolio credit quality. The WARF has increased to 7.38, as of the most recent trustee report dated Aug. 2, 2007, from 6.20 when the transaction went effective on May 9th, 2007. Currently, 17.6% of the portfolio is on Rating Watch Negative and in Fitch's view 35.3% of the portfolio is below investment grade quality, including approximately 7.7% 'CCC' or lower credit quality. It is Fitch's view that based on the collateral composition of the portfolio and the percentage of bonds on rating watch negative the downgrades to the notes reflect the risk inherent in the underlying portfolio. The class A-2, B and C notes have been placed on Rating Watch Negative and the class D notes remain on Rating Watch Negative due to exposure to 2005, 2006 and 2007 RMBS subprime collateral, currently experiencing high default and delinquency rates, of which a substantial percentage have not been reviewed by any agency. Fitch expects to resolve the Rating Watch status on these notes as the expected performance of these bonds is more apparent. The ratings on the class A-1, A-2 and B notes address the timely payment of interest and ultimate receipt of principal; the ratings on the class B-1, B-2 and C notes address the ultimate payment of interest and principal. All classes of notes have a legal final maturity of Feb 2047. OPTIGENEX INC: Posts $740,262 Net Loss in Quarter Ended June 30 --------------------------------------------------------------- Optigenex Inc.'s consolidated balance sheet at June 30, 2007, showed $2.5 million in total assets and $9.0 million in total liabilities, resulting in a $6.5 million total stockholders' deficit. The company reported a net loss of $740,262 for the second quarter ended June 30, 2007, compared with a net loss of $1.3 million for the same period last year. Net sales for the quarter ended June 30, 2007, were $92,136 compared to net sales of $85,178 for the quarter ended June 30, 2006, an increase of $6,958 or 8.2%. Full-text copies of the company's consolidated financial statements for the quarter ended June 30, 2007, are available for free at http://researcharchives.com/t/s?22d0 Going Concern Doubt Goldstein Golub Kessler LLP, in New York, expressed substantial doubt about Optigenex Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements for the years ended Dec. 31, 2006, and 2005. The auditing firm pointed to the company's recurring losses from operations and stockholders deficiency. For the six months ended June 30, 2007, the company had a net loss of $1.6 million and had a stockholders' deficit of $6.5 million at June 30, 2007. About Optigenex Inc. Optigenex Inc. (OTC BB: OPGX.OB) supplies bulk material and finished products featuring its patented and wholly natural compound AC-11(R) a core ingredient to wholesale distributors, skin care and nutraceutical marketing companies. In addition, the company licenses its technology and trademark to third party marketers and manufacturers of skin care and nutraceutical products. ORION 2006-1: Fitch Cuts Rating on $32.5MM Class D Notes to "B+" ---------------------------------------------------------------- Fitch downgraded four classes of notes issued by Orion 2006-1 CDO, Ltd. These rating actions are the result of Fitch's review process and are effective immediately: -- $98,500,000 class A notes downgraded to 'AA' from 'AAA'; -- $81,000,000 class B notes downgraded to 'A-' from 'AA'; -- $77,000,000 class C notes downgraded to 'BB' from 'A', removed from Rating Watch Negative; -- $32,544,000 class D notes downgraded to 'B+' from 'BBB', removed from Rating Watch Negative. Orion 2006-1 is a collateralized debt obligation that closed on May 26, 2006 and is managed by NIBC Credit Management, Inc which operates under the fund management arm of NIBC Bank N.V. Fitch is monitoring the effect the acquisition of NIBC Holding NV by Kaupthing Bank hf. will have on the CDO platform managed by NIBC CMI. Orion 2006-1 remains in the reinvestment period until December 2010. Included in this review, Fitch discussed the current state of the portfolio with the asset manager. Additionally Fitch conducted cash flow modeling utilizing various default timing and interest rate scenarios to measure the breakeven default rates going forward relative to the minimum cumulative default rates required for the rated liabilities. Fitch's rating actions reflect the significant collateral deterioration within the portfolio, specifically subprime residential mortgage-backed securities, which comprise approximately 92.87% of the underlying assets. The entire portion of Orion 2006-1's exposure to subprime RMBS consists of 2005, 2006 and 2007 vintages, which are experiencing higher levels of delinquencies and defaults. Further, Orion 2006-1's portfolio contains a sizeable exposure (16.2%) to subprime closed-end second lien RMBS assets, including under-performing 2006 vintage subprime CES RMBS bonds. Reflective of the portfolio's credit quality decline is the Fitch Weighted Average Rating Factor which as of the July 27, 2007 trustee report has increased to 7.47 ('BBB- '/'BB+') as compared to 5.3 ('BBB'/'BBB-') as of August 27, 2006, the first trustee report available. The current WARF value violates its corresponding covenant of 7.26 ('BBB-'/'BB+'). The majority of downgrades in the underlying portfolio took place in the last three months and were the result of credit deterioration in subprime RMBS; downgrades have continued since the July 27 trustee report. Currently 11% of the portfolio is on Rating Watch Negative and in Fitch's opinion 15% is of below investment grade quality, of which 8% is of 'CCC' or lower quality. The credit deterioration in the portfolio has increased the risk profile of all classes of notes. This rating analysis also incorporated Fitch's revised methodology for rating structured finance CDOs. The ratings of the class A and B notes address the likelihood that investors will receive full and timely payments of interest, as per the governing documents, as well as the aggregate outstanding amount of principal by the stated maturity date. The ratings of the class C notes and D notes address the likelihood that investors will receive ultimate and compensating interest payments, as per the governing documents, as well as the aggregate outstanding amount of principal by the stated maturity date. A portion of the notes will be issued subsequent to close as the asset manager ramps-up the collateral portfolio. OSCAR HAMILTON: Case Summary & 19 Largest Unsecured Creditors ------------------------------------------------------------- Debtors: Oscar Hamilton Margaret Hamilton 2722 Cypress Grove Road Grand Ridge, FL 32442 Bankruptcy Case No.: 07-50281 Chapter 11 Petition Date: August 21, 2007 Court: Northern District of Florida (Panama City) Debtors' Counsel: Charles M. Wynn, Esq. Charles M. Wynn Law Offices, P.A. P.O. Box 146 Marianna, FL 32447 Tel: (850) 526-3520 Fax: (850) 526-5210 Total Assets: $422,091 Total Debts: $4,502,371 Debtors' List of its 19 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ W.D. Windgate 250 acres with $1,254,619 Georgia Farm Services, LLC homestead P.O. Box 529 Leesburg, GA 31763 Byrd Smalley Evans & Adams Cooperative Debt $977,025 P.O. Box 2179 Decatur, AL 35602 Superior Bank Farming Loan $615,115 126 North Broadway Sylacauga, AL 35150 UAP Distribution Inc. Final Judgment $314,871 Special Reg. Assets Manager 7251 West 4th Street Greeley, CO 80634 Superior Bank Farming Loan $277,524 Operations Center Birmingham, AL 35203 Green Tree Servicing L 2000 Triple Wide $92,297 Mobile Home Agricredit Acceptance KMC 3376 6-row $39,110 Combine Amadas 6 row stak $14,913 puller adna KMC 11 Shank v-kipper Early Tractor Co. Inc. Final Judgment $35,600 C.C. Bodiford Land Rent $26,000 Sangaree Oil Final Judgment $22,827 Armtech Insurance Service Rain Year Ins. $22,797 Wachovia Bank Check Overdraft $18,000 Stafford $17,681 Nichols Tractor Co. Various Charges $15,753 Swearingen - Lord Equip. Co. Final Judgment $11,578 Merchants Ad. Collection Med - $10,785 Flowers Hospital Focus Credit Union Line of Credit $10,052 AMEX Credit Card $9,313 Judkins, Simpson & High American Growers Ins. $7,370 PACIFIC LUMBER: Scopac Wants Diamond McCarthy as Co-Counsel ----------------------------------------------------------- Frank Shaw Bacik, vice president and general counsel of Scotia Pacific Company LLC, relates that the Debtor is currently represented in its Chapter 11 case by Gibson, Dunn & Crutcher LLP and Porter & Hedges, L.L.P. To increase efficiencies in its bankruptcy case, Scopac intends to maximize its reliance on Texas counsel going forward. As part of this process, Scopac seeks to hire Diamond McCarthy, LLP, as bankruptcy counsel to replace Porter & Hedges. Mr. Bacik relates that since July 17, 2007, Diamond McCarthy has worked extensively with Scopac, Gibson Dunn, and Porter & Hedges to familiarize itself with Scopac, Scopac's business, and the issues in Scopac's Chapter 11 case. Pursuant to Sections 327(a) and 328(a) of the Bankruptcy Code, Scopac seeks the U.S. Bankruptcy Court for the Southern District of Texas' permission to employ Diamond McCarthy as its bankruptcy counsel effective as of Aug. 1, 2007. Scopac has selected Diamond McCarthy as its counsel because of the firm's extensive experience and knowledge and its established reputation in corporate reorganizations and debt restructurings under Chapter 11, according to Mr. Bacik. Scopac believes that Diamond McCarthy is highly qualified and uniquely able to represent its interests in the bankruptcy case. Mr. Bacik relates that Diamond McCarthy and Gibson Dunn will coordinate their areas of responsibility, as directed by Scopac, to minimize duplication of effort and maximize efficiency, while at the same time coordinating their efforts to ensure consistency and to implement common strategies and objectives. As Scopac's co-counsel, Diamond McCarthy will: (a) advise Scopac of its rights, powers and duties as a debtor-in-possession continuing to manage its properties; (b) review the nature and validity of claims asserted against the Scopac's property and advise Scopac concerning the enforceability of those claims; (c) prepare on Scopac's behalf all necessary and appropriate applications, motions, pleadings, draft orders, notices, schedules, and other documents and review all financial and other reports to be filed in the Chapter 11 case; (d) advise Scopac concerning responses to, applications, motions, complaints, pleadings, notices, and other papers that may be filed and served in the Chapter 11 case; (e) counsel Scopac in connection with the formulation, negotiation, and promulgation of a plan of reorganization and related documents; (f) perform other legal services for and on Scopac's behalf, which may be necessary or appropriate in the administration of the Chapter 11 case and Scopac's business; and (g) work with other professionals retained by the Debtors and other parties-in-interest in the bankruptcy cases to attempt approval of a plan of reorganization for Scopac. The Debtor will pay Diamond McCarthy according to the firm's customary hourly rates: Professional Hourly Rate ------------ ----------- Partners and counsel $300 - $600 Associates $195 - $270 Paralegals $145 - $170 The Diamond McCarthy attorneys and paraprofessionals who will primarily be providing services to Scopac in connection with its bankruptcy case are: Professional Hourly Rate ------------ ----------- Kyung S. Lee, Esq. $465 Wendy K. Laubach, Esq. $390 Steve Loden, Esq. $315 Christopher D. Johnson, Esq. $300 Jason Rudd, Esq. $300 Erin Jones, Esq. $255 Reda Dennis, Esq. $210 Tracy Markovich $155 Scopac will also reimburse Diamond McCarthy for any necessary out- of-pocket expenses the firm incurs in rendering the contemplated services. Kyung S. Lee, a partner at Diamond McCarthy, assures the Court that his firm does not represent or hold any interest adverse to Scopac, its estate, creditors, or equity security holders in the matters on which the firm is to be engaged, and is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code and as is required for employment under Section 327(a) of the Bankruptcy Code. About Pacific Lumber Headquartered in Oakland, California, The Pacific Lumber Company -- http://www.palco.com/-- and its subsidiaries operate in several principal areas of the forest products industry, including the growing and harvesting of redwood and Douglas-fir timber, the milling of logs into lumber and the manufacture of lumber into a variety of finished products. Scotia Pacific Company LLC, Scotia Development LLC, Britt Lumber Co., Inc., Salmon Creek LLC and Scotia Inn Inc. are wholly owned subsidiaries of Pacific Lumber. Scotia Pacific, Pacific Lumber's largest operating subsidiary, was established in 1993, in conjunction with a securitization transaction pursuant to which the vast majority of Pacific Lumber's timberlands were transferred to Scotia Pacific, and Scotia Pacific issued Timber Collateralized Notes secured by substantially all of Scotia Pacific's assets, including the timberlands. Pacific Lumber, Scotia Pacific, and four other subsidiaries filed for chapter 11 protection on Jan. 18, 2007 (Bankr. S.D. Tex. Case Nos. 07-20027 through 07-20032). Jack L. Kinzie, Esq., at Baker Botts LLP, is Pacific Lumber's lead counsel. Nathaniel Peter Holzer, Esq., Harlin C. Womble, Jr., Esq., and Shelby A. Jordan, Esq., at Jordan Hyden Womble Culbreth & Holzer PC, is Pacific Lumber's co-counsel. Kathryn A. Coleman, Esq., and Eric J. Fromme, Esq., at Gibson, Dunn & Crutcher LLP, acts as Scotia Pacific's lead counsel. John F. Higgins, Esq., and James Matthew Vaughn, Esq., at Porter & Hedges LLP, is Scotia Pacific's co- counsel. When Pacific Lumber filed for protection from its creditors, it listed estimated assets and debts of more than $100 million. Scotia Pacific listed total assets of $932,000,000 and total debts of $765,978,335. The Debtors' exclusive period to file a chapter 11 plan expires on Sept. 18, 2007, as extended. The Debtors' exclusive period to solicit acceptances of that plan expires on Nov. 19, 2007. (Scotia/Pacific Lumber Bankruptcy News, Issue No. 24, http://bankrupt.com/newsstand/or 215/945-7000). PACIFIC LUMBER: Gets Open Ended Deadline to Decide on Five Lease ---------------------------------------------------------------- The Hon. Judge Richard S. Schmidt of the U.S. Bankruptcy Court for the Southern District of Texas extends the time by which Pacific Lumber Company and its debtor-affiliates must assume, assume and assign, or reject their five unexpired real property leases until the entry of an order confirming a plan of reorganization regarding the Debtors' bankruptcy cases. Jack L. Kinzie, Esq., at Baker Botts L.L.P., in Dallas, Texas, relates that the Debtors are parties to five leases, which govern their interests in non-residential real properties located in Humboldt County, California, and cover a wide range of uses and properties. The Leases are: 1. Montoya Substation Use Agreement. A Use Agreement under which The Pacific Lumber Company is the lessee, pertaining to an energy substation in Humboldt County, California, used by PALCO for the provision of utility services for the town of Scotia, California. The current monthly rent under the Use Agreement is $278, and the Agreement will expire on December 31, 2025. 2. Mad River Industrial Complex. A lease of commercial real property in Arcata, California, used for lumber re-manufacturing and storage purposes. The current monthly rent under the Arcata Lease is $7,858, and the Lease will expire on January 31, 2011. 3. Christie Sublease. A lease of a sawmill and manufacturing plant in Humboldt County under which Debtor Britt Lumber Co., Inc. is a sub-lessee. The Humboldt Sawmill Lease will expire on September 30, 2046, and provides for a $153 monthly rent. 4. Master Lease Agreement. A master lease pertaining to various commercial premises under which Debtor Scotia Pacific Company, LLC, is the lessor and PALCO is the lessee. Pursuant to the lease agreement, PALCO subleases premises to third parties and pays Scopac, on a semi-annual basis, 80% of the rent while retaining the remaining 20%. The Master Lease will expire on July 20, 2028. 5. Scopac Office Lease. A lease under which PALCO leases commercial premises located in Scotia to Scopac for a $18,659 monthly rent. The Lease will expire on October 31, 2008. Mr. Kinzie informs the Court that the Debtors: -- have timely made all postpetition rental or similar payments to the lessors under the Leases; -- have timely performed their postpetition payment obligations as required by Section 365(d)(3); and -- fully intend to continue to comply with their future postpetition payment obligations. With respect to all of the Leases, each of the landlords has provided its written consent to extend the Debtors' time to assume or reject the Leases, Mr. Kinzie tells Judge Schmidt. The landlord for the Mad River Industrial Complex's consent, however, is subject to the condition that the order extending the time to assume or reject provide that in the event Britt subsequently seeks to reject the lease, Britt provide the landlord with at least 90 days' prior notice to the effective date of any rejection. "It would not benefit the Debtors or their estates to make a decision to assume or reject the Leases at this point in their cases, unnecessarily exposing the estates to administrative expenses, especially given that no decision is required in light of the landlords' consent," Mr. Kinzie contends. About Pacific Lumber Headquartered in Oakland, California, The Pacific Lumber Company -- http://www.palco.com/-- and its subsidiaries operate in several principal areas of the forest products industry, including the growing and harvesting of redwood and Douglas-fir timber, the milling of logs into lumber and the manufacture of lumber into a variety of finished products. Scotia Pacific Company LLC, Scotia Development LLC, Britt Lumber Co., Inc., Salmon Creek LLC and Scotia Inn Inc. are wholly owned subsidiaries of Pacific Lumber. Scotia Pacific, Pacific Lumber's largest operating subsidiary, was established in 1993, in conjunction with a securitization transaction pursuant to which the vast majority of Pacific Lumber's timberlands were transferred to Scotia Pacific, and Scotia Pacific issued Timber Collateralized Notes secured by substantially all of Scotia Pacific's assets, including the timberlands. Pacific Lumber, Scotia Pacific, and four other subsidiaries filed for chapter 11 protection on Jan. 18, 2007 (Bankr. S.D. Tex. Case Nos. 07-20027 through 07-20032). Jack L. Kinzie, Esq., at Baker Botts LLP, is Pacific Lumber's lead counsel. Nathaniel Peter Holzer, Esq., Harlin C. Womble, Jr., Esq., and Shelby A. Jordan, Esq., at Jordan Hyden Womble Culbreth & Holzer PC, is Pacific Lumber's co-counsel. Kathryn A. Coleman, Esq., and Eric J. Fromme, Esq., at Gibson, Dunn & Crutcher LLP, acts as Scotia Pacific's lead counsel. John F. Higgins, Esq., and James Matthew Vaughn, Esq., at Porter & Hedges LLP, is Scotia Pacific's co- counsel. When Pacific Lumber filed for protection from its creditors, it listed estimated assets and debts of more than $100 million. Scotia Pacific listed total assets of $932,000,000 and total debts of $765,978,335. The Debtors' exclusive period to file a chapter 11 plan expires on Sept. 18, 2007, as extended. The Debtors' exclusive period to solicit acceptances of that plan expires on Nov. 19, 2007. (Scotia/Pacific Lumber Bankruptcy News, Issue No. 24, http://bankrupt.com/newsstand/or 215/945-7000). PARADIGM MEDICAL: June 30 Balance Sheet Upside-Down by $2.6 Mil. ---------------------------------------------------------------- Paradigm Medical Industries Inc.'s consolidated balance sheet at June 30, 2007, showed $2.3 million in total assets and $4.9 million in total liabilities, resulting in a $2.6 million total stockholders' deficit. The company reported a net loss of $1.5 million and an operating loss of $483,000 for the second quarter ended June 30, 2007, compared with a net loss of $755,000 and an operating loss of $201,000 for the same period last year. Net sales for the three months ended June 30, 2007, decreased by $458,000, or 64%, to 260,000 as compared to $718,000 for the same period of 2006. This reduction in sales was primarily due to reduced sales of the P40, P45 and P60 UBM Ultrasound Biomicroscopes and the LD 400 Perimeters. The increase in operating loss is mainly attributable to the decrease in sales and an increase in total operating expenses. The increase in net loss primarily reflects the increase in operating loss and an increase of $509,000 in financing costs. Full-text copies of the company's consolidated financial statements for the quarter ended June 30, 2007, are available for free at http://researcharchives.com/t/s?22d2 Going Concern Doubt Chisholm, Bierwolf & Nilson LLC, in Bountiful, Utah, expresssed substantial doubt about Paradigm Medical Industries Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements as of Dec. 31, 2006. The auditing frim pointed to the company's working capital deficit and recurring operating losses. About Paradigm Medical Headquartered in Salt Lake City, Paradigm Medical Industries Inc. (OTC BB: PMED.OB) -- http://www.paradigm-medical.com/-- currently develops, manufactures and markets high-tech, proprietary diagnostic equipment and consumable products for the medical industry. PARMALAT SPA: Sells Spanish Operations to Lacteos Siglo ------------------------------------------------------- Parmalat S.p.A. disclosed in a press release that it has executed an agreement selling all of the Spanish operations to Lacteos Siglo XXI s.l. (Group Nueva Rumasa) for about EUR188,000,000, following the signing of the sale and purchase agreement in May 2007 and the obtainment of the clearance from the Spanish Antitrust Authority in June 2007. Based in Milan, Italy, Parmalat S.p.A. -- http://www.parmalat.net/ -- sells nameplate milk products that can be stored at room temperature for months. It also has about 40 brand product lines, which include yogurt, cheese, butter, cakes and cookies, breads, pizza, snack foods and vegetable sauces, soups and juices. The Company's U.S. operations filed for chapter 11 protection on Feb. 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 or bankruptcy protection, they reported more than US$200 million in assets and debts. The U.S. Debtors emerged from bankruptcy on April 13, 2005. Parmalat S.p.A. and its Italian affiliates filed separate petitions for Extraordinary Administration before the Italian Ministry of Productive Activities and the Civil and Criminal District Court of the City of Parma, Italy on Dec. 24, 2003. Dr. Enrico Bondi was appointed Extraordinary Commissioner in each of the cases. The Parma Court has declared the units insolvent. On June 22, 2004, Dr. Bondi filed a Sec. 304 Petition, Case No. 04-14268, in the United States Bankruptcy Court for the Southern District of New York. Parmalat has three financing arms: Dairy Holdings Ltd., Parmalat Capital Finance Ltd., and Food Holdings Ltd. Dairy Holdings and Food Holdings are Cayman Island special-purpose vehicles established by Parmalat S.p.A. The Finance Companies are under separate winding up petitions before the Grand Court of the Cayman Islands. Gordon I. MacRae and James Cleaver of Kroll (Cayman) Ltd. serve as Joint Provisional Liquidators in the cases. On Jan. 20, 2004, the Liquidators filed Sec. 304 petition, Case No. 04-10362, in the United States Bankruptcy Court for the Southern District of New York. In May 2006, the Cayman Island Court appointed Messrs. MacRae and Cleaver as Joint Official Liquidators. Gregory M. Petrick, Esq., at Cadwalader, Wickersham & Taft LLP, and Richard I. Janvey, Esq., at Janvey, Gordon, Herlands Randolph, represent the Finance Companies in the Sec. 304 case. The Honorable Robert D. Drain presides over the Parmalat Debtors' U.S. cases. (Parmalat Lumber Bankruptcy News, Issue No. 90; http://bankrupt.com/newsstand/or 215/945-7000). PARMALAT SPA: Boschi Food & Beverage Acquires Business Assets ------------------------------------------------------------- Boschi Luigi & Figli S.p.A., a subsidiary of Parmalat S.p.A., has executed the transfer of all of its business assets to Boschi Food & Beverage S.p.A., following the receipt of the approval of certain Antitrust authorities, according to Parmalat's company statement. Boschi Luigi operates in the production, transformation and manufacturing of tomato-based products, fruit juices and tea-based beverages. Following the execution of the sale agreement, Boschi Luigi has collected the entire consideration for the transaction equal to EUR30,180,000, the company press release discloses. Simultaneously with the sale of those assets, Parmalat discloses in a separate press release that its Pomi, Pomito and Pais brands have been sold to Boschi Food & Beverage, for approximately EUR2,320,000. Boschi Food & Beverage S.p.A., is a recently constituted company owned by Consorzio Interregionale Ortofrutticolo and Consorzio Casalasco. Based in Milan, Italy, Parmalat S.p.A. -- http://www.parmalat.net/ -- sells nameplate milk products that can be stored at room temperature for months. It also has about 40 brand product lines, which include yogurt, cheese, butter, cakes and cookies, breads, pizza, snack foods and vegetable sauces, soups and juices. The Company's U.S. operations filed for chapter 11 protection on Feb. 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 or bankruptcy protection, they reported more than US$200 million in assets and debts. The U.S. Debtors emerged from bankruptcy on April 13, 2005. Parmalat S.p.A. and its Italian affiliates filed separate petitions for Extraordinary Administration before the Italian Ministry of Productive Activities and the Civil and Criminal District Court of the City of Parma, Italy on Dec. 24, 2003. Dr. Enrico Bondi was appointed Extraordinary Commissioner in each of the cases. The Parma Court has declared the units insolvent. On June 22, 2004, Dr. Bondi filed a Sec. 304 Petition, Case No. 04-14268, in the United States Bankruptcy Court for the Southern District of New York. Parmalat has three financing arms: Dairy Holdings Ltd., Parmalat Capital Finance Ltd., and Food Holdings Ltd. Dairy Holdings and Food Holdings are Cayman Island special-purpose vehicles established by Parmalat S.p.A. The Finance Companies are under separate winding up petitions before the Grand Court of the Cayman Islands. Gordon I. MacRae and James Cleaver of Kroll (Cayman) Ltd. serve as Joint Provisional Liquidators in the cases. On Jan. 20, 2004, the Liquidators filed Sec. 304 petition, Case No. 04-10362, in the United States Bankruptcy Court for the Southern District of New York. In May 2006, the Cayman Island Court appointed Messrs. MacRae and Cleaver as Joint Official Liquidators. Gregory M. Petrick, Esq., at Cadwalader, Wickersham & Taft LLP, and Richard I. Janvey, Esq., at Janvey, Gordon, Herlands Randolph, represent the Finance Companies in the Sec. 304 case. The Honorable Robert D. Drain presides over the Parmalat Debtors' U.S. cases. (Parmalat Lumber Bankruptcy News, Issue No. 90; http://bankrupt.com/newsstand/or 215/945-7000). POPULAR INC: Paying $0.16/Share Dividend on October 1 ----------------------------------------------------- The board of directors of Popular Inc. declared on Aug. 15, 2007, a cash dividend of $0.16 per common share. The dividend is payable on Oct. 1, 2007, to the stockholders of record as of Sept. 14, 2007. Headquartered in Puerto Rico, Popular Inc. (Nasdaq: BPOP) is a full service financial institution with operations in Puerto Rico, the United States, the Caribbean and Latin America. With over 300 branches and offices, the company offers retail and commercial banking services through its franchise, Banco Popular de Puerto Rico, well as auto and equipment leasing and financing, mortgage loans, consumer lending, investment banking, broker/dealer and insurance services through specialized subsidiaries. In the United States, the company has established a community banking franchise providing a broad range of financial services and products to the communities it serves. * * * AS reported in the Troubled Company Reporter on May 9, 2007, Fitch Ratings has downgraded Individual rating of Popular Inc. to 'B/C' from 'B'. PRC LLC: Moody's Downgrades Corporate Family Rating to B3 --------------------------------------------------------- Moody's Investors Service downgraded PRC's corporate family rating to B3 from B2, affirmed the company's bank facility ratings, and placed these ratings under review for possible downgrade. The downgrade of the corporate family rating to B3 reflects the company's weaker than anticipated profitability, which is primarily the result of poor start-up execution on one of its new major contracts. The B3 rating incorporates PRC's negative net return on assets and high financial leverage as measured by adjusted debt to EBITDA and free cash flow to adjusted debt for the twelve months ended June 2007, relative to services industry peers. The company currently maintains weak liquidity. The company has cash balances of about $9 million as of June 2007 and after reinvesting internally generated cash flow to support new contract awards, PRC has minimal free cash flow, calculated as operating cash flow less capital expenditures. The company has adequate liquidity through external sources, which include its $20 million first lien revolver and a delayed draw first lien capital expenditures facility of $25 million. As of June 2007, both facilities remained undrawn. Moody's believes that unless operating performance improves, the company will potentially need to utilize its revolving credit facility to fund working capital and capital expenditures. Although the company is currently in compliance with financial covenants of its credit facilities, the company will be challenged to remain in compliance for the next twelve months, absent resolution of the financial detriment of its one large problem contract or cash infusion from its private equity sponsor. The company's private equity sponsor, Diamond Castle, has the option to invest cash common equity for up to two out of four consecutive quarters in order to allow the company to remain in compliance with its financial covenants. The intention to do this by the equity sponsors provides some support to the company's covenant compliance in the near term. The review will focus on the company's prospects to improve poor contract execution and financial performance, and the amount of additional equity invested by Diamond Castle in the business. Ratings downgraded and placed under review for further downgrade: -- Corporate Family Rating -- B3 -- Probability of Default Rating -- B3 Ratings affirmed and placed under review for downgrade: -- $20 million first lien revolving credit facility -- B1, LGD-3, 31% -- $25 million first lien delayed draw capex term loan -- B1, LGD-3, 31% -- $115 million first lien term loan -- B1, LGD-3, 31% -- $67 million second lien term loan -- Caa1, LGD-5, 77% Headquartered in Plantation, Florida, PRC, LLC provides outsourced customer care and sales and marketing business process outsourcing services. On Nov. 29, 2006, private equity firm Diamond Castle Holdings and members of PRC's management team acquired PRC from its former parent, IAC/InterActiveCorp. QUAKER FABRIC: Organizational Meeting Scheduled on August 28 ------------------------------------------------------------ The U.S. Trustee for Region 3 will hold an organizational meeting to appoint an official committee of unsecured creditors in Quaker Fabric Corporation and Quaker Fabric Corporation of Fall River's chapter 11 cases at 10:00 a.m., on Aug. 28, 2007, at Room 5209, J. Caleb Boggs Federal Building, 844 North King Street, in Wilmington, Delaware. The sole purpose of the meeting will be to form a committee or committees of unsecured creditors in the Debtors' cases. The meeting is not the meeting of creditors pursuant to Section 341 of the Bankruptcy Code. However, a representative of the Debtor will attend and provide background information regarding the cases. Creditors interested in serving on a Committee should complete and return to the U.S. Trustee a statement indicating their willingness to serve on an official committee. Official creditors' committees, constituted under Section 1102 of the Bankruptcy Code, ordinarily consist of the seven largest creditors who are willing to serve on a committee. In some Chapter 11 cases, the U.S. Trustee is persuaded to appoint multiple creditors' committees. Official creditors' committees have the right to employ legal and accounting professionals and financial advisors, at the Debtors' expense. They may investigate the Debtors' business and financial affairs. Importantly, official committees serve as fiduciaries to the general population of creditors they represent. Those committees will also attempt to negotiate the terms of a consensual Chapter 11 plan -- almost always subject to the terms of strict confidentiality agreements with the Debtors and other core parties-in-interest. If negotiations break down, the Committee may ask the Bankruptcy Court to replace management with an independent trustee. If the Committee concludes that the reorganization of the Debtors is impossible, the Committee will urge the Bankruptcy Court to convert the Chapter 11 cases to a liquidation proceeding. Based in Fall River, Mass., Quaker Fabric Corp. (NASDAQ: QFAB) -- http://www.quakerfabric.com/-- designs, manufactures, and markets woven upholstery fabrics primarily for residential furniture manufacturers and jobbers. It also develops and manufactures specialty yarns, including chenille, taslan, and spun products for use in the production of its fabrics, as well as for sale to distributors of craft yarns, and manufacturers of home furnishings and other products. The company is one of the largest producers of Jacquard upholstery fabrics. Quaker Fabric sells its products through sales representatives and independent commissioned sales agents in the United States, Canada, Mexico, and internationally. The company and its affiliate, Quaker Fabric Corporation of Fall River, filed for chapter 11 protection on Aug. 16, 2007 (Bankr. D. Del. Case No. 07-11146). Joel A. Waite, Esq., at Young, Conaway, Stargatt & Taylor LLP represents the Debtors. The Debtors' balance sheet at June 2, 2007 disclosed total assets of $155,243,945 and total debts of S$60,407,158. QUALITY HOME: Case Summary & 79 Largest Unsecured Creditors ----------------------------------------------------------- Lead Debtor: Quality Home Loans dba Clear Credit Capital dba Last Chance Home Loans dba Last Option Lending dba Q.H.L. Investments 27001 West Agoura Road, 3rd Floor Agoura Hills, CA 91301 Tel: (888) 845-8888 Bankruptcy Case No.: 07-13006 Debtor-affiliates filing separate Chapter 11 petitions: Entity Case No. ------ -------- California T.D. Investments, L.L.C. 07-13003 Golden State T.D. Investments, L.L.C. 07-13004 Q.H.L. Holdings Fund Ten, L.L.C. 07-13005 Type of business: The Debtors are equity lenders. See http://www.qualityhomeloans.com Chapter 11 Petition Date: August 21, 2007 Court: Central District Of California (San Fernando Valley) Debtors' Counsel: Mike D. Neue, Esq. Irell & Manella, L.L.P. 840 Newport Center Drive, Suite 400 Newport Beach, CA 92660 Tel: (949) 760-0991 Fax: (949) 760-5200 Estimated Assets Estimated Debts ---------------- --------------- Quality Home Loans $1 Million to More than $100 Million $100 Million California T.D. Investments, $1 Million to $100,000 to L.L.C. $100 Million $1 Million Golden State T.D. Investments $1 Million to $100,000 to L.L.C. $100 Million $1 Million Q.H.L. Holdings Fund Ten, $1 Million to $1 Million to L.L.C. $100 Million $100 Million A. Quality Home Loans's 19 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ California T.D. $11,100,000 c/o Q.H.L. 27001 West Agora Road Agora Hills, CA 91301 Keller Tel: (954) 924-3417 private loan $503,176 First California Bank bank loan $352,468 Attention: Corporate Officer P.O. Box 6017 Camarillo, CA 93011-6017 Milligan private loan $70,000 Clear Capital.com trade debt $51,595 D.D.I. Leasing trade debt $47,294 Manifest Funding Services trade debt $44,310 G.E. Vendor Financial Services trade debt $42,873 A.E.L. Financial trade debt $47,578 Dell Computer trade debt $21,838 National City Technology trade debt $16,736 Finance Zone Funding trade debt $15,917 L.S.I. Tax Service trade debt $14,365 C.B.C. Innovis trade debt $9,705 Joe Swears trade debt $8,600 Franzen and Salzano trade debt $7,512 Staple Business Advantage trade debt $6,984 Streamline Office Services trade debt $6,295 Melissa Data Corp. trade debt $5,888 B. California TD Investments, LLC's 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Andrew S. Berwick, III investor $818,672 Separate Property Trust Chelham Way Santa Barbara, CA 93108 Gary Fasola investor $420,000 4240 Lost Hills Road, Suite 2903 Calabasas, CA 91301 Kenton J. Hallberg and Millie investor $326,500 Hallberg 11160 South 625 Road Stockton, MO 65785 Sam Gerard investor $300,000 P.O. Box 4308 Santa Barbara, CA 93140 Richard Barnes investor $300,000 P.O. Box 5198 Ventura, CA 93005 Floyd R. Lindquist and Marian investor $245,500 E. Lindquist, Trustees George Thompson investor $241,167 Robert W. Uhl and investor $200,000 Nancy L. Uhl Sylvia Barnes investor $200,000 Aaron Fabbian and Bridget investor $150,000 Fabbian Revocable Living Trust of investor $100,866 Russell Earl Shiek, dtd. Merrell Properties, L.L.C. investor $100,000 Raznick Trust of 1980 investor $100,000 Nicholas Torok & Kay S. Torok investor $100,000 Allen L. Lee and Janet Y. Lee investor $100,000 The Exemption Trust of the investor $100,000 Herman Family Trust The Survivor's Trust of the investor $100,000 Herman Family Trust Kenneth Lindquist and Karen investor $70,000 Lindquist Shirley D. Milligan Trust investor $55,000 Joan M. Lindquist investor $50,296 C. Golden State TD Investments, LLC's 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Patrick H. Leicester investor $2,500,000 4089 Mayfield Street Newbury Park, CA 91320 Edward M. Welsh Family Trust investor $1,000,000 1725 Avenida De Aprisa Camarillo, CA 93010 John Shutt investor $700,000 513 Calle Converse Camarillo, CA 93010 Will H. and Nancy D. Steele investor $600,000 J.T.W.R.O.S. P.O. Box 1595 Montgomery, TX 77356 The Anthony and Maria Dal investor $600,000 Bello Family Trust, Dtd. 10/8/86 510 Alston Road Santa Barbara, CA 93108 Julie Ann Levy investor $542,276 410 Willard Road Santa Paula, CA 93060 Shigeyasu Steve Hiraiwa and investor $500,000 Chihisa Hiraiwa 32024 Pacifica Drive Palos Verdes, CA 90275 Aaron Fabbian and Bridget investor $493,760 Fabbian 1351 South La Luna Avenue Ojai, CA 93023 Gary Fasola investor $450,000 4240 Lost Hills Road, Suite 2903 Calabasas, CA 91301 Marc Sobel T.T.E.E. investor $350,000 P.O. Box 403 Bass Lake, CA 93604 Ojai Oil Company investor $350,000 Attention: Douglass Off 760 Paseo Camarillo, Suite 400 Camarillo, CA 93010 Lincoln Trust Company, investor $324,772 T.T.E.E. F.B.O. John C. Keller 3200 North Ocean Drive, Suite 205 Hollywood, FL 33019 Jose S. Escamilla and Maria investor $323,201 J. Escamilla 120 Magnolia Avenue Oxnard, CA 93030 Kathleen Craig or Ray Craig investor $250,000 847 Tamlei Avenue Thousand Oaks, A 91362 Jon and Ellen Pelzer Common investor $250,000 Property 85 Old Shore Road, Suite 200 Port Washington, NY 11050 Elena Karalius investor $225,000 Alan Koichi Yoshida investor $217,890 Richard Barnes investor $200,000 The Survivor's Trust of the investor $200,000 Herman Family Trust Fiserv-Iss F.B.O. Patrick investor $200,000 Leicester Defined Benefit Plan D. Q.H.L. Holdings Fund Ten, LLC's 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Shirley D. Milligan, Trustee investor $507,001 P.O. Box 2061 Ventura, CA 93002 Robert L. Milligan and $393,588 Krystal L. Milligan 6591 Swan Street Ventura, CA 93003 Roy Lee Stone $625,678 777 North Olive Street Ventura, CA 93003 Rosalie Volan, T.T.E.E. $480,158 6110 Village 6 Camarillo, CA 93012 N.F.S./F.M.T.C. F.B.O. $346,594 Donald R. Hays, I.R.A. 18635 Brasilia Drive Northridge, CA 91326 Shigeyasu Steve Hiraiwa $500,000 and Chihisa Hiraiwa 32024 Pacifica Drive Palos Verdes, CA 90275 Taylor Charitable Remainder $400,000 Unitrust c/o Robert Taylor 13721 Glen Oaks Boulevard Sylmar, CA 91342 S.&E. Phillips Living Trust $500,000 c/o Samuel Philips 6110 Village 6 Camarillo, CA 93012 The Huber Family Trust, Dtd. $1,100,000 3/16/89 c/o John and Elizabeth Huber 20538 Toluca Avenue Torrance, CA 90503 Ronald Misrach $650,000 15432 Gault Street Van Nuys, CA 91406 Robert Shaw and $962,560 Connie Shaw 2431 Greenfield Avenue Clovis, CA 93611 Edward M. Welsh Family $1,000,000 Trust 1725 Avenida De Aprisa Camarillo, CA 93010 Tina Coffelt Living Trust $1,010,556 1219 Village View Road Encinitas, CA 92024 George Steve Krisan $323,200 2135 Mandan Place Simi Valley, CA 93065 Joseph Karalius $500,000 132 Maple Road Newbury Park, CA 91320 Johnny and Sylvia Giannetto $375,000 J.T.W.R.O.S. 1336 Shore Bird Lane Carlsbad, CA 92011 Robert L. Diamond $332,367 781 Camino Santos Reyes Thousand Oaks, CA 91360 Jaimes Paul Wondra $2,400,478 152 Silas Avenue Newbury Park, CA 91320 Security Mutual Properties, $400,000 Inc. Retirement Trust c/o Jerry and Barbara Myers 2200 Pebble Beach Trail Oxnard, CA 93036 Kadoch Family Trust $400,000 c/o Jack and Miriam Kadoch 80598 Avenida San Felipe Indio, CA 92203 RANCHER'S BEEF: Files for Bankruptcy; Lays Off Workers ------------------------------------------------------ Hundreds of staff at a meat processing plant have been laid off due to Rancher's Beef Ltd.'s bankruptcy filing, Tarina White of the Calgary Sun reports. The company's closure is seen as a blow to Canada's beef industry which is still reeling from the effects of the 2003 "Mad Cow" crisis, the report discloses citing Canada Beef Exports president Ted Haney. Citing Cor Van Raay, a southern Alberta feedlot operator, the report relates that the company never recovered from a bad financial start. Due to changes in the funding formula, loan guarantees promised by the federal government fell short by around $10 million, added Mr. Raay. This, the company had to use part of the processing plant's operating budget to cover the shortage and finish the construction. The plant, according to the report, was expected to process 800 cattle on a daily basis but operators could only afford to process 400. Art Price, Rancher's Beef chairman, couldn't be reached for comment, the report adds. Rancher's Beef Ltd. -- http://www.ranchersbeef.ca/-- is a Canadian owned and operated meat processing facility. As a limited partnership, Rancher's Beef is comprised of approximately 50 unit holders involved in all levels of the beef industry. RESIDENTIAL CAPITAL: Market Disruption Cues Fitch to Cut Rating --------------------------------------------------------------- Following Fitch's rating actions on Aug. 16, 2007 relating to U.S. residential mortgage companies, Fitch issued a release to further detail the actions on Residential Capital LLC. Fitch downgraded ResCap's Issuer Default Rating to 'BB+' from 'BBB' and placed it on Rating Watch Negative. Prior to the downgrade, Fitch had changed ResCap's Outlook to Negative reflecting the challenging market conditions and deteriorating operating performance of the company. Approximately $17.8 billion of debt was affected by the action. The downgrade and placement on Rating Watch Negative primarily reflects the severe disruption in the capital markets, which has reduced liquidity for mortgage-centric companies. The reduction in primary liquidity has caused ResCap to rely on alternative committed sources of funding and change its business mix toward less-risky conforming mortgages. While Fitch's actions mainly reflect the market disruption, Fitch has been concerned with the company's weak operating performance, which has been noticeably worse than peer companies. ResCap has been taking remedial actions such as increasing provisions, reducing expenses and reducing nonprime and warehouse lending exposures. Fitch believes that market illiquidity for non-conforming mortgages will cause ResCap to further alter its loan origination volumes and types toward lower-yielding conforming and less risky mortgages. While this reduces the company's credit risk and funding needs, it will likely diminish the company's already strained earnings potential going forward. Further, based on stressed industry conditions, Fitch believes ResCap is exposed to further writedowns of mortgage-related assets. In Fitch's view, ResCap has good capital levels, although the likelihood and magnitude of any impairments are not known at this time. The resolution of the Rating Watch will follow developments in the residential mortgage market over the next few quarters. Fitch will evaluate the impact the market dislocation has on ResCap's operating performance, liquidity, and capital levels. Residential Capital LLC ratings, all on Rating Watch Negative -- L-T Issuer Default Rating 'BB+'; -- S-T IDR 'B'; -- Senior unsecured debt 'BB+' ; -- Subordinated debt 'BB-'. REUNION INDUSTRIES: June 30 Balance Sheet Upside-Down by $23 Mil. ----------------------------------------------------------------- Reunion Industries Inc.'s consolidated balance sheet at June 30, 2007, showed $50.3 million in total assets, $73.0 million in total liabilities, and $385,000 in minority interests, resulting in a $23.1 million total stockholders' deficit. At June 30, 2007, the company's consolidated balance sheet also showed strained liquidity with $29.6 million in total current assets available to pay $69.4 million in total current liabilities. The company reported net income of $679,000 and an operating profit of $48,000, on sales of $7.0 million for the second quarter ended June 30, 2007, compared with net income of $3.3 million and an operating loss of $64,000, on sales of $6.5 million for the comparable period a year ago. Net sales for the second quarter of 2007 were up 8.3% from the same quarter of 2006, reflecting a slight increase in cylinder sales and a 20% increase in grating sales. The swing to an operating profit in the second quarter ended June 30, 2007, is mainly due to a decrease in selling, general and administrative expenses. The decrease in net income primarily reflects the gain on debt extinguishments of $4.0 million in the prior period quarter, partly offset by an increase of $1.2 million in income from the discontinued pressure vessel operations. Selling, general and administrative (SGA) expenses for the second quarter of 2007 were $1.2 million, down $102,000 from the expenses for the second quarter of 2006. This decrease in expense reflects a decrease in SGA expenses in the cylinder segment and at corporate offset somewhat by an increase in marketing expense in the grating business in connection with the increase in sales in that segment. As a percentage of sales, SGA expenses decreased to 17.7% for the second quarter of 2007 from 20.1% for the second quarter of 2006. There was a $4.0 million gain on debt extinguishment in the second quarter of 2006 related to the final settlement of the SFSC $4.29 million judgment and all accrued interest. There was no such gain in the comparable period in 2007. Interest expense for the second quarter of 2007 was $1.9 million compared to $2.0 million for the second quarter of 2006. Full-text copies of the company's consoldiated financial statements for the quarter ended June 30, 2007, are available for free at http://researcharchives.com/t/s?22d3 Default on 13% Senior Notes The 13% restructured Senior Notes and accumulated interest, which totaled $30.8 million at Dec. 31, 2006, became due and payable on Jan. 3, 2007. The company did not make such payment and thus continued to be in default under the Indenture under which the Senior Notes were issued. However, under an Intercreditor and Subordination Agreement entered into in December 2003 among Wachovia Bank, the holders of the Senior Notes and certain other lenders, the Senior Note holders cannot commence any action to enforce their liens on any collateral for a 180 day period beginning after the date of receipt by Wachovia, the senior secured lender, of a written notice from the Senior Note holders informing Wachovia of its demand for payment. On Feb. 2, 2007, Wachovia received written notice of such demand for payment. The standstill period thus expired as of Aug. 2, 2007. As of June 30, 2007, the total amount due and payable on the 13% Senior Notes, including accumulated interest, was $35.0 million. Going Concern Doubt As reported in the Troubled Company Reporter on April 17, 2007, Mahoney Cohen & Company, in New York, expressed substantial doubt about Reunion Industries Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements as of the years ended Dec. 31, 2006, and 2005. The auditing firm reported that at Dec. 31, 2006, the company has a deficiency in working capital of $39.3 million, a loss from continuing operations of $2.9 million before gain on debt extinguishment, and a stockholders' deficit of $23 million. At June 30, 2007, the company has a deficiency in working capital of $39.8 million, a loss from continuing operations for the first six months of 2007 of $4.1 million and a deficiency in assets of $23.1 million. Additionally, at June 30,2007, the company was in default on substantially all of its debt. About Reunion Industries Headquartered in Pittsburgh, Pennsylvania, Reunion Industries Inc. (AMEX: RUN) -- http://www.reunionindustries.com/-- owns and operates industrial manufacturing operations that design and manufacture engineered, high-quality products for specific customer requirements, such as hydraulic and pneumatic cylinders and metal bar grating. Prior to 2007, the company's continuing operations' products also included large-diameter seamless pressure vessels. Such pressure vessel business was reclassified to discontinued operations effective Jan. 1, 2007. RINKER BOAT: Moody's Junks Corporate Family Rating -------------------------------------------------- Moody's Investors Service downgraded the ratings of Rinker Boat Company based on its continuing moderating operating performance as a result of the worse than anticipated downturn in the marine industry and violation of financial covenants in the LTM ended June 2007. At the same time, Moody's placed Rinker's ratings on review for possible further downgrade pending completion of an amendment to revise the covenants under its bank credit facilities. "The downgrade reflects our concerns that the company's modest operating performance will linger as the marine industry cyclical downturn continues." said Kevin Cassidy, Vice President/Senior Credit Officer at Moody's Investors Service. Mr. Cassidy further noted that "the downgrade incorporates the company's inability to comply with certain financial covenants, which were amended in August 2006." He also stated that "while the company is currently generating modest operating cash flow, its liquidity could deteriorate rapidly if demand further moderates and the company does not succeed in amending the covenants and loses access to its revolver." The review for possible further downgrade reflects the uncertainty of the company being able to amend the credit facility on acceptable terms in the current credit market environment. The review will focus on the company's alternative sources of liquidity in the event it is not able to amend the credit facility. These ratings/assessments were downgraded: -- Corporate family rating to Caa1 from B3; -- Probability of default rating at Caa1 from B3; -- Senior Secured Term Loan to B3 (LGD 3, 40%) from B2 (LGD 3, 40%); -- Revolving Credit Facility to B3 (LGD 3, 40%) from B2 (LGD 3, 40%) Rinker Boat Company's is headquartered in Syracuse, Indiana. ROCKLAND VENDING: Case Summary and 21 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: Rockland Vending Corporation 1 Sanford Avenue Chester, NY 10918 Bankruptcy Case No.: 07-36261 Type of Business: The Debtor manufactures vending machines. Chapter 11 Petition Date: August 20, 2007 Court: Southern District of New York (Poughkeepsie) Judge: Cecelia G. Morris Debtor's Counsel: Thomas Genova, Esq. Genova & Malin Hampton Business Center 1136 Route 9 Wappingers Falls, NY 12590 Tel: (845) 298-1600 Fax: (845) 298-1265 Total Assets: $576,106 Total Debts: $1,323,716 Debtor's 21 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Vistar/Visa $110,436 71 Walsh Drive Parsippany, NJ 07054-5850 V.M.E. Distributor $92,838 6010 North Bailey Avenue, Suite 5 Amherst, NY 14226 Coca-Cola Co. $30,801 P.O. Box 802575 Chicago, IL 60680-2575 Pepsi-Cola Bottling $22,566 Co. Teich, Beim & Moro, P.C. $16,900 Leisure Time $16,000 Blue Flame Propane $10,397 Sultana Distribution $9,216 Services, Inc. Citibank A Advantage $6,961 Chet's Garage $6,647 Pepsi-Cola Bottling $22,566 S.P. Beverage $5,897 Merchantile-Self $5,858 Insurance Trust Eden's Snacks, L.L.C. $5,792 Alarm Specialist $5,489 Oxford Health Plans $3,350 Vendors Exchange International $3,195 Hanover Insurance $2,661 Snapple Dist. $2,276 American Express $1,808 Interstate Waste Services $1,800 SENTINEL MANAGEMENT: Gets Court OK to Disburse Asset Sale Proceeds ------------------------------------------------------------------ Sentinel Management Group Inc. obtained authority from the U.S. Bankruptcy Court for the Northern District of Illinois to disburse most of the $312 million it received from an asset sale, Tiffany Kary of Bloomberg News reports. According to the report, the Honorable John H. Squires said Sentinel can immediately pay its clients money from last week's sale to hedge fund firm Citadel Investment Group LLC. Bloomberg relates that Sentinel was barred Aug. 17 by a different federal judge from disbursing the proceeds after clients sued, accusing it of selling assets at a discount. Separately, on Tuesday, The Wall Street Journal reported that the Securities and Exchange Commission filed civil fraud charges against Sentinel alleging that the company suffered losses for several months because of "undisclosed use of leverage, commingling and misappropriation of clients' securities." A person familiar with the investigation told WSJ that the complaint, filed Monday in U.S. District Court in Chicago, claims Sentinel's woes are a case of fraud disguised as a casualty of the markets. A lawyer for Sentinel declined to comment on the issue, WSJ said. Based in Northbrook, Illinois, Sentinel Management Group Inc. -- http://www.sentinelmgi.com/-- is a full service firm offering a variety of security solutions. The company filed a chapter 11 petition on August 17, 2007 (Bankr. N.D. Ill. Case No. 07-14987). The Debtor selected Ronald Barliant, Esq., at Goldberg, Kohn, Bell & Black Rosenbloom & Moritz, Ltd. as its counsel. When the Debtor sought bankruptcy protection, it listed assets and debts of more than $100 million. SMALL WORLD: Has Until September 14 to File Schedules & Statement ----------------------------------------------------------------- The Hon. Alan M. Ahart of the United States Bankruptcy Court for the Central District of California gave Small World Toys until Sept. 14, 2007, to file its Schedules of Assets and Debts and Statement of Financial Affairs. The Debtor relates that since filing for bankruptcy, its key personnel and bankruptcy counsel have been working diligently to maintain and conduct its business as orderly and efficiently as possible. The Debtor further relates that it also has to address chapter 11 transition issues, issues which are mostly unfamiliar to the Debtor. The Debtor says that it needs the additional time to analyze and compile the information needed to complete its schedules and statements. Headquartered in Culver City, California, Small World Toys -- http://www.smallworldtoys.com/-- develops, manufactures, markets, and distributes education developmental toys. The company's proprietary brands feature toys for children 10 years old and below. The company filed for chapter 11 protection on Aug. 2, 2007 (Bankr. C.D. Calif. Case No. 07-16606). Ron Bender, Esq., at Levene, Neale, Bender, Rankin & Brill, L.L.P., represents the Debtor in its restructuring efforts. When the Debtor filed for protection from its creditors, it listed estimated assets and debts between $1 million and $10 million. SOLUTIA INC: Wants Court Approval on Chemical Plant Agreement ------------------------------------------------------------- Solutia Inc. relates that it manufactured a family of chlorobenzene-based derivatives at their W.G. Krummich plant and their Anniston, Alabama plant, which accounted for approximately 2% of its consolidated revenues. Chlorobenzenes are chemical intermediates used to produce polymers and polymer additives, rubber chemicals, agricultural products, pharmaceuticals and other industrial chemicals. Solutia shut down its production of chlorobenzene during 2003 and 2004, as it became unprofitable due to foreign competition. As a result, the equipment used became and is idle. Since the production shutdown, Solutia engaged in discussions with multiple parties regarding the sale of the idle Chlorobenzene Equipment. Management determined that a certain purchaser provided the most attractive opportunity, which included not just the highest price for the Chlorobenzene Equipment, but also benefits associated with a continued business relationship. The Purchaser approached Solutia in early 2007, seeking a company with expertise in chemical plant operations to partner with to manufacture a certain chemical. The Purchaser determined it could convert manufacturing assets used to produce Chlorobenzene into facilities to manufacture alternative chemicals. Jonathan S. Henes, Esq., at Kirkland & Ellis LLP, in New York, informs the U.S. Bankruptcy Court for the Southern District of New York that Solutia had intended to dismantle and dispose of the idle Chlorobenzene Equipment at Krummich for scrap value. He states that the Purchaser's offer presented a unique opportunity for Solutia to not only maximize value through the sale of its equipment, but also enter into a relationship with the Purchaser, whereby Solutia would: * operate the Purchaser's production facility at Krummich; * provide other services to the Purchaser; and * have the potential to enter into similar transactions at some of Solutia's other facilities -- the Arrangement. Solutia and the Purchaser engaged in arm's-length negotiations regarding the sale of the Chlorobenzene Equipment and a potential manufacturing arrangement. The negotiations resulted in Solutia and the Purchaser entering into the Agreements, which govern the development, ownership and operation of a production facility to be located at Krummich, as well as the potential production at some of Solutia's other facilities. The terms of the Agreements, include: * The Chlorobenzene Equipment, including all applicable buildings, structures, pipelines, instruments and foundations, will be sold to the Purchaser for $2,000,000; * The Purchaser is authorized to begin converting and upgrading the Chlorobenzene Equipment at Krummich. In exchange, the Purchaser will pay Solutia a fully non- refundable prepaid rights access fee of $8,000,000. Once production standards have been met at Krummich, the Purchaser will pay Solutia a production fee based upon the volume of chemical produced at Krummich and sold by the Purchaser. The Production Fee will be paid on a monthly basis for each year of the term of a lease and operating agreement; * Under the terms of the Lease and Operating Agreement, Solutia will lease certain land within Krummich to the Purchaser and will provide the Purchaser with additional access rights and other easements with respect to certain portions of Krummich. In addition, Solutia will perform and supply certain services utilized in chemical production and the operation of Krummich to the Purchaser, who will pay all the costs related to the services. The Purchaser will also pay Solutia on a monthly basis a pre- tax return on the net capital employed by Solutia in providing the services; and an operations management payment. The initial term of the Lease and Operating Agreement will be 10 years and, thereafter, will continue for an indefinite period until terminated by Solutia or the Purchaser on at least 24 months prior written notice; * Under the terms of the "Enhanced Services Agreement," Solutia will provide consulting services to the Purchaser, for the Purchaser's manufacturing process. The consulting services may include site project management, process consulting, logistics and purchasing expertise, process automation and business plan development. The initial term of the Enhanced Services Agreement will be three years and it will automatically renew for successive one year terms unless terminated by Solutia or the Purchaser with written notice. The Purchaser will pay Solutia consulting fees; and * The "Master Development Agreement" addresses Solutia and the Purchaser's desire to further explore and implement the establishment of chemical manufacturing operations on additional Solutia sites. If certain established production targets at Krummich are reached, Solutia may make some of its other sites available to the Purchaser for the development, ownership and operation of additional facilities pursuant to similar arrangements. Each new site must be authorized by a separate development authorization executed by Solutia and the Purchaser. While entry into each of the Agreements to effectuate the Arrangement could constitute transactions in the ordinary course of Solutia's business, due to the overall scope of the Arrangement, and out of an abundance of caution, Solutia seeks the Court's authority to implement the Arrangement. About Solutia Inc. Headquartered in St. Louis, Missouri, Solutia Inc. (OTCBB:SOLUQ) -- http://www.solutia.com/-- and its subsidiaries, engage in the manufacture and sale of chemical-based materials, which are used in consumer and industrial applications worldwide. The company and 15 debtor-affiliates filed for chapter 11 protection on Dec. 17, 2003 (Bankr. S.D.N.Y. Case No. 03-17949). When the Debtors filed for protection from their creditors, they listed $2,854,000,000 in assets and $3,223,000,000 in debts. Solutia is represented by Allen E. Grimes, III, Esq., at Dinsmore & Shohl, LLP and Conor D. Reilly, Esq., at Gibson, Dunn & Crutcher, LLP. Trumbull Group LLC is the Debtor's claims and noticing agent. Daniel H. Golden, Esq., Ira S. Dizengoff, Esq., and Russel J. Reid, Esq., at Akin Gump Strauss Hauer & Feld LLP represent the Official Committee of Unsecured Creditors, and Derron S. Slonecker at Houlihan Lokey Howard & Zukin Capital provides the Creditors' Committee with financial advice. On Feb. 14, 2006, the Debtors filed their Reorganization Plan & Disclosure Statement. On May 15, 2007, they filed an Amended Reorganization Plan and on July 9, 2007, filed a 2nd Amended Reorganization Plan. The Disclosure Statement hearing began on July 10, 2007. The Debtors have asked the Court to extend their exclusive plan filing period to Dec. 31, 2007. (Solutia Bankruptcy News, Issue No. 96; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). SOLUTIA INC: Inquip Associates Wants Adequate Protection -------------------------------------------------------- Inquip Associates Inc. tells the U.S. Bankruptcy Court for the Southern District of New York that Solutia Inc. proposes to enter into a manufacturing agreement with a certain purchaser, which would result in the immediate sale of the equipment Solutia used in its Chlorobenzene production located at W.G. Krummich plant in Sauget, Illinois, to the Purchaser and the manufacturing of a chemical at the Krummich Plant; a lease of a portion of the Krummich Plant to the Purchaser -- the Sale and Lease Agreement; and the potential future production of certain chemicals with the Purchaser at other Solutia facilities -- the Arrangement. Inquip is the holder of a claim in the stipulated amount of $1,477,626 that is secured by the real estate owned by Solutia, which includes the Krummich Plant. Edward A. Smith, Esq., at Venable LLP, in New York, says that Inquip has not consented to the Sale and Lease Agreement, which proposes the sale and lease of a portion of its collateral and the use of the proceeds thereof that are its cash collateral without provision of adequate protection of Inquip's secured claim, as required under Section 361 of the Bankruptcy Code. Inquip asks the Court to require that, as adequate protection, proceeds from the Sale and Lease Agreement of not less than $2,000,000 be held by Solutia in a separate segregated and identifiable account subject to Inquip's lien claim to pay Inquip's secured claim with interest. Headquartered in St. Louis, Missouri, Solutia Inc. (OTCBB:SOLUQ) -- http://www.solutia.com/-- and its subsidiaries, engage in the manufacture and sale of chemical-based materials, which are used in consumer and industrial applications worldwide. The company and 15 debtor-affiliates filed for chapter 11 protection on Dec. 17, 2003 (Bankr. S.D.N.Y. Case No. 03-17949). When the Debtors filed for protection from their creditors, they listed $2,854,000,000 in assets and $3,223,000,000 in debts. Solutia is represented by Allen E. Grimes, III, Esq., at Dinsmore & Shohl, LLP and Conor D. Reilly, Esq., at Gibson, Dunn & Crutcher, LLP. Trumbull Group LLC is the Debtor's claims and noticing agent. Daniel H. Golden, Esq., Ira S. Dizengoff, Esq., and Russel J. Reid, Esq., at Akin Gump Strauss Hauer & Feld LLP represent the Official Committee of Unsecured Creditors, and Derron S. Slonecker at Houlihan Lokey Howard & Zukin Capital provides the Creditors' Committee with financial advice. On Feb. 14, 2006, the Debtors filed their Reorganization Plan & Disclosure Statement. On May 15, 2007, they filed an Amended Reorganization Plan and on July 9, 2007, filed a 2nd Amended Reorganization Plan. The Disclosure Statement hearing began on July 10, 2007. The Debtors have asked the Court to extend their exclusive plan filing period to Dec. 31, 2007. (Solutia Bankruptcy News, Issue No. 96; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). SPECTRUM BRANDS: Appoints John D. Bowlin as Board Chairman ---------------------------------------------------------- Spectrum Brands Inc. has appointed John D. Bowlin as chairman of the board. Mr. Bowlin replaces David A. Jones, who is resigning his position as a director after serving as chairman of the board since 1996, and as chief executive officer from 1996 until May 23, 2007. Mr. Bowlin has been a director of Spectrum Brands since May 2004, and is a member of the audit committee and the nominating and corporate governance committee. "The other board members and I congratulate John on his appointment," Kent Hussey, chief executive officer of Spectrum Brands, said. "We appreciate his continued service to the company and believe Spectrum will benefit significantly from his leadership and extensive experience at some of the world's largest consumer products companies as we continue to make progress on our strategy to improve operational performance while reducing our leverage and interest burden. I look forward to working closely with him as Spectrum addresses the challenges and opportunities ahead." "Dave Jones' entrepreneurial leadership and guidance over the past eleven years have been a driving force behind the growth of Spectrum Brands into the world-class consumer products company that it is today, Mr. Hussey continued. "On behalf of the entire board and the employees and customers at Spectrum, we thank him for his leadership and contributions as chairman and CEO and wish him well in his future endeavors." Mr. Bowlin has over 30 years of managerial and operational experience in the consumer products industry. Recently, he was president and chief executive officer of SABMiller PLC from 2002 to 2003. Prior to that, he held several senior executive positions at Phillip Morris Companies Inc., including serving as chief executive officer of Miller Brewing Company from 1999 to 2002, president and chief executive officer of Kraft Foods International from 1996 to 1999 and as Kraft North America's president and chief operating officer from 1994 to 1996, and president of Oscar Meyer Food Corporation from 1991 to 1993. He held various positions at General Foods Corporation. In addition to his role at Spectrum Brands, Mr. Bowlin currently serves as a board member at a number of privately-held companies. About Spectrum Brands Inc. Headquartered in Atlanta, Georgia, Spectrum Brands Inc. (NYSE: SPC) -- http://www.spectrumbrands.com/-- is a consumer products company and a supplier of batteries and portable lighting, lawn and garden care products, specialty pet supplies, shaving and grooming and personal care products, and household insecticides. Spectrum Brands' products are sold by the world's top 25 retailers and are available in more than one million stores in 120 countries around the world. The company has manufacturing and distribution facilities in China, Australia and New Zealand, and sales offices in Melbourne, Shanghai, and Singapore. The company has approximately 8,400 employees worldwide. * * * Moody's Investor Services placed Caa1 on Spectrum Brands Inc.'s long term corporate family rating and probability of default on March 2007. The outlook is stable. Standard and Poor's assigned CCC+ on its long term foreign and local issuer credit on Feb 2007. The outlook is negative. STANDARD MOTOR: Board OKs $3.3MM Stock Repurchase Program Add On ---------------------------------------------------------------- Standard Motor Products Inc.'s board of directors has authorized a $3.3 million increase in the company's stock repurchase program. The program is in addition to the company's existing stock repurchase program, under which the company repurchased approximately $1.7 million of stock. Any repurchased shares will be held as treasury stock and will be available for general corporate purposes, including funding existing stock plans. The amount and timing of the repurchases will depend upon market conditions. "At current market levels, we believe our stock represents an attractive investment opportunity, and our repurchase program reflects our ongoing commitment to enhance shareholder value." Lawrence I. Sills, Standard Motor Products' chairman and chief executive officer, stated. In addition, the company has appointed Pamela Forbes Lieberman as an independent director to the company's board of directors, effective Aug. 15, 2007. Ms. Lieberman will serve on each of the committees of the board of directors. Ms. Lieberman, 53, served as the president and chief executive officer of True Value Corporation and is a Certified Public Accountant. "We are very pleased to welcome Pamela to our board," Mr. Sills stated. "We believe that based on her business background and leadership skills, she will be a valuable asset to our organization, and we look forward to her contributions to our company." About Standard Motor Headquartered in Long Island City, New York, Standard Motor Products Inc. (NYSE: SMP) -- http://smpcorp.com/-- manufactures and distributes replacement parts for motor vehicles in the automotive aftermarket industry. The company supplies Engine Management and Temperature Control parts for motor vehicles - domestic and imported, new as well as older vehicles. Parts are sold throughout the U.S., Canada, Central and South America, Europe and Asia, by traditional warehouse distributors and auto parts stores, as well as major retail stores. Standard Motor Products Inc has more than 20 factories and distribution centers throughout the U.S., Puerto Rico, Canada, Europe and the Far East. * * * As reported in the Troubled Company Reporter on July 26, 2007, Standard & Poor's Ratings Services revised its outlook on Standard Motor Products Inc. to positive from negative. The ratings including the 'B-' corporate credit rating, were affirmed. STANLEY-MARTIN: S&P Affirms B+ Corporate Credit Rating ------------------------------------------------------ Standard & Poor's Ratings Services affirmed its 'B+' corporate credit ratings on Stanley-Martin Communities LLC and its subsidiary, Stanley-Martin Financing Corp., as well as its 'B-' rating on Stanley-Martin Communities LLC's senior subordinated debt. The outlook is stable. "The ratings reflect Stanley-Martin's comparatively small and geographically concentrated market position in the still soft Washington, D.C., market, an aggressively leveraged balance sheet, and uncertainty regarding whether an opportunistic growth posture at this point in the cycle will prove successful," said credit analyst Elizabeth Campbell. "These weaknesses are somewhat mitigated by a 40-year operating history within a homebuilding market that, though currently soft and experiencing price corrections, continues to exhibit favorable longer-term fundamentals." Standard & Poor's expects Stanley-Martin to continue to pursue a measured operating strategy, which should generate adequate liquidity in the near term. If the company's community openings that are planned for the next couple of quarters fall significantly short of sales expectations, or if the company's leverage rises further, S&P would revise the outlook to negative. TELENET GROUP: Moody's Affirms B1 Corporate Family Rating --------------------------------------------------------- Moody's Investors Service affirmed a B1 corporate family rating of Telenet Group Holding N.V. following the company's announced recapitalisation. Concurrently, Moody's assigned a B1 rating to the senior secured bank facility in the amount of EUR2.3 billion. The proceeds of the facility will be largely used to refinance Telenet's existing bonds and the senior secured bank facility as well as to make a shareholder distribution. Moody's will withdraw the bond ratings upon their redemption. In line with Moody's practice under its Loss Given Default methodology, Moody's has also amended the expected family recovery to 65% given that the group is now operating with a first-lien bank debt capital structure resulting in the assignment of probability of default rating of B2/LD, one notch below the B1 corporate family rating. The affirmation of the corporate family rating reflects Moody's earlier expectations that Telenet was likely to change its credit profile alongside with a contemplated at that time change in its ownership. Following the re-capitalisation, the company will be leveraged at about 5.3x Debt to EBITDA including its clientele and annuity obligations. Moody's notes that the terms and conditions of the bank facility do not include these obligations in the leverage definition for covenant compliant purposes of the covenant calculation. The affirmation of the corporate family rating also takes into account the company's strong operating performance; elimination of event risk previously associated with a change in the ownership and increased visibility regarding Telenet's financial policies in the near term. Moody's understands that the company earmarked EUR160 million out of the facility proceeds for potential acquisitions. In the event the company does not consummate any acquisitions, these funds will likely be redeployed towards shareholder distributions. The B1 rating on the senior secured facility (LGD-3, 37.8%) reflects its security package over the borrower's shares, Telenet BidCo NV - an intermediate holding company, and certain intercompany loans. The facility rating at the level of the corporate family rating reflects the limited amount of junior obligations in the company's debt capital structure. The facility consist of Tranche A of EUR425 million, Tranche B of EUR1.3 billion and a seven-year revolving facility of EUR175 million. The stable outlook on the rating reflects Moody's expectations that Telenet will continue to achieve robust operational results. However, Moody's notes that Telenet is likely to be free cash flow negative in 2007 due to substantial foreign exchange losses associated with the planned redemption of its US dollar denominated bonds and the close out of its hedging contracts. What Could Change the Rating -- Up Strong operational and financial performance in conjunction with de-leveraging below 5x Debt to EBITDA on a sustainable basis; visibility regarding medium to long term financial policies and shareholder distributions though Moody's expects the company to manage its leverage towards the guideline metrics for the rating category. What Could Change the Rating - Down A deterioration of the company's operations as a result of intense competition leading to erosion of margins and cash flows on an extended basis; a change to financial policy employing a substantially higher leverage than the current levels with leverage trending towards 6x Debt to EBITDA. Telenet, located in Flanders, is the largest cable operator in Belgium. For the first six months in 2007, the company generated EUR456.7 million in revenue with a 48% reported EBITDA margin. TOLL BROTHERS: S&P Holds "BB+" Rating on $350 Mil. Senior Notes --------------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'BBB-' corporate credit rating on Toll Brothers Inc. and its subsidiaries. At the same time, S&P affirmed its 'BBB-' rating on roughly $1.1 billion of senior unsecured notes issued by Toll Brothers Finance Corp. and S&P's 'BB+' rating on $350 million of senior subordinated notes issued by Toll Corp. The outlook is stable. "Although operating trends have been weak through this cyclical downturn, the ratings on Toll remain supported by sector-leading profit margins, a conservatively leveraged financial profile, and very good liquidity," said credit analyst James Fielding. "These strengths are tempered by deteriorating EBITDA-based credit metrics, as Toll's earnings have been negatively affected by sharply lower sales volume." The stable outlook reflects Toll's above-average profit margins, which should provide capacity to increase incentives to sell homes, if necessary. Positive ratings momentum is clearly precluded at this time by extremely competitive conditions in most of the nation's housing markets, and S&P would revise its outlook to negative, or lower its ratings, if market conditions worsen and Toll is unable to continue to generate operating profits and free cash flow. This scenario would become increasingly likely if the current volatility in the jumbo loan market extends and materially restricts customers' ability to finance Toll's luxury homes. TRIBUNE CO: Shareholders Okay Going-Private Transaction ------------------------------------------------------- Tribune Company shareholders have approved the merger agreement entered into in connection with the company's going-private transaction. At the company's special shareholders meeting in Chicago, approximately 97% of the shares voted were cast in favor of the merger. The number of shares voted in favor of the merger represented approximately 65% of the total shares outstanding and entitled to vote at the meeting. "We're pleased that Tribune shareholders recognize the value of this transaction and have voted overwhelmingly to approve it," Dennis FitzSimons, Tribune chairman, president and chief executive officer, said. "With financing fully committed, we anticipate closing the transaction in the fourth quarter, after FCC approval and satisfaction of the other closing conditions." "I believe Tribune Company is reasserting itself as a national leader in news generation and distribution," Sam Zell said. "Despite the recent upheaval in the credit markets, my view of the company as an investment has not changed." Headquartered in Chicago, Tribune Company (NYSE: TRB) -- http://www.tribune.com/-- is one of the country's top media companies, operating businesses in publishing, interactive and broadcasting. It reaches more than 80% of U.S. households and is the only media organization with newspapers, television stations and websites in the nation's top three markets. In publishing, Tribune's leading daily newspapers include the Los Angeles Times, Chicago Tribune, Newsday (Long Island, NY), The Sun (Baltimore), South Florida Sun-Sentinel, Orlando Sentinel and Hartford Courant. The company's broadcasting group operates 23 television stations, Superstation WGN on national cable, Chicago's WGN-AM and the Chicago Cubs baseball team. * * * Moody's Investor Services placed Ba3 on Tribune Company's long term family rating and probability of default on April 2007. Standard and Poor's rated B+ its long term foreign and local issuer credit on July 2007. UNITY WIRELESS: Posts $3.3 Million Net Loss in Qtr. Ended June 30 ----------------------------------------------------------------- Unity Wireless Corp. reported a net loss of $3.3 million on sales of $2.6 million for the second quarter ended June 30, 2007, compared with a net loss of $1.2 million on sales of $2.0 million for the comparable period a year ago. Unity Wireless chief executive officer, Ilan Kenig commented, "Unity demonstrated growth for the last two years in a row. In 2005 we achieved sales of $4.9 million. Last year we saw almost 50% growth to $7.3 million. In the first half of 2007, we are now at $4.8 million. Although revenue growth is consistent, and we are now penetrating tier-one players and participate in major long term projects with world leaders in the cellular industry, last year's merger activity has not yet delivered the multiples of revenue that we initially had hoped for, making it unlikely that we will meet the original growth targets within the anticipated time frames. Some of this can be attributed to the short term effects of consolidation and the realignment of our manufacturing chain, while another portion is due to project deployment cycles among our client base." The increase in net loss was primarily the result of the increase in amortization of intangible assets and the additional research and development expenses relating to the acquired companies. Research and development expenses for the three-month period ended June 30, 2007, were $1.3 million, an increase of $842,252 or 169.89%, from $495,749 for the three-month period ended June 30, 2006. This increase was primarily the result of the additional research and development expenses from the three acquired companies (Avantry, Celerica, & Celletra) which were not part of the group as of the last period, and incurring additional R&D expenses in order to develop and fulfill requirements for specific equipment orders in both India and Russia. Depreciation and amortization expenses for the three-month period ended June 30, 2007, were $847,014, an increase of $757,028, from $89,986 for the three-month period ended June 30, 2006. This increase was primarily the result of the amortization of the intangible assets recorded relating to the acquired companies in 2006. During the three-month period ended June 30, 2007, the company recorded $738,910 as the amortization of the intangibles. Interest expense for the three-month period ended June 30, 2007, increased by $74,692 to $190,545 from $115,853 for the three-month period ended June 30, 2006. This increase was primarily the result of the increase in interest expense from the issuance of convertible debentures in February and December of 2006. Accretion of interest and loss on debt settlement for the three- month period ended June 30, 2007, was $74,925, a decrease of $25,010, compared to $99,935 for the three-month period ended June 30, 2006. This decrease was primarily the result of the debt modifications of the convertible notes issued in August 2004, February 2005 and February 2006 which resulted in losses on debt settlements recorded in 2006. The company recorded an amortization of the premium on the convertible notes for $76,716 against the accretion of interest in the three-month period ended June 30, 2007. At June 30, 2007, the company's consolidated financial statements showed $21.4 million in total assets, $19.6 million in total liabilities, and $1.8 million in total stockholders' equity. The company's consolidated balance sheet at June 30, 2007, also showed strained liquidity with $6.3 million in total current assets available to pay $14.6 million in total current liabilities. Full-text copies of the company's consolidated financial statements for the quarter ended June 30, 2007, are available for free at http://researcharchives.com/t/s?22da Going Concern Doubt KPMG LLP, in Vancouver, Canada, expressed substantial doubt about Unity Wireless Corp.'s ability to continue as a going concern after auditing the company's consolidated financial statements for the years ended Dec. 31, 2006, and 2005. The auditing firm pointed to the company's recurring losses from operations. About Unity Wireless Headquartered in Burnaby, British Columbia, Canada, Unity Wireless Corp. (OTC BB: UTYW.OB) -- http://unitywireless.com/ -- provides wireless coverage enhancement solutions for cellular operators and custom subsystems for network infrastructure manufacturers. US AIRWAYS: Court Okays Stipulation with United on Code Share Pact ------------------------------------------------------------------ In accordance with Sections 1.44 and 9.6(b) of the Joint Plan of Reorganization and with the consent of the Post-Effective Date Committee, the U.S. Bankruptcy Court for the Eastern District of Virginia extended Reorganized U.S. Airways and affiliates' deadline to object to administrative claims to Oct. 31, 2007. Reorganized U.S. Airways Inc. and United Air Lines Inc. are continuing their discussions regarding modifications to, and assumption of, the Code Share and Regulatory Cooperation Agreement and the Star Alliance Participation Agreement. In a stipulation approved by the Court, the Reorganized Debtors and United agree that: (i) the hearing on the Reorganized Debtors' request to assume the Agreements is continued to October 18, 2007 at 9:30 a.m.; (ii) the deadline for the Reorganized Debtors to assume or reject the Agreements is extended through and including the October Hearing Date; and (iii) the time periods referenced in a letter agreement dated September 14, 2005, is extended to the October Hearing Date. Based in Tempe, Arizona, US Airways Group Inc.'s (NYSE: LCC) - http://www.usairways.com/-- primary business activity is the ownership of the common stock of US Airways, Inc., Allegheny Airlines, Inc., Piedmont Airlines, Inc., PSA Airlines, Inc., MidAtlantic Airways, Inc., US Airways Leasing and Sales, Inc., Material Services Company, Inc., and Airways Assurance Limited, LLC. Under a Chapter 11 plan declared effective on March 31, 2003, USAir emerged from bankruptcy with the Retirement Systems of Alabama taking a 40% equity stake in the deleveraged carrier in exchange for $240 million infusion of new capital. US Airways and its subsidiaries filed another chapter 11 petition on Sept. 12, 2004 (Bankr. E.D. Va. Case No. 04-13820). Brian P. Leitch, Esq., Daniel M. Lewis, Esq., and Michael J. Canning, Esq., at Arnold & Porter LLP, and Lawrence E. Rifken, Esq., and Douglas M. Foley, Esq., at McGuireWoods LLP, represent the Debtors in their restructuring efforts. In the Company's second bankruptcy filing, it lists $8,805,972,000 in total assets and $8,702,437,000 in total debts. The Debtors' Chapter 11 plan for its second bankruptcy filing became effective on Sept. 27, 2005. The Debtors completed their merger with America West on the same date. (US Airways Bankruptcy News, Issue No. 147 Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). * * * As reported in the Troubled Company Reporter on March 13, 2007, Standard & Poor's Ratings Services assigned its 'B' rating to US Airways Group Inc.'s $1.6 billion secured credit facility due 2014, currently being syndicated. US TELEPACIFIC: S&P Holds 'B-' Rating and Revises Outlook to Pos. ----------------------------------------------------------------- Standard & Poor's Ratings Services revised its outlook on Los Angeles-based U.S. TelePacific Holdings Corp. to positive from stable. At the same time, S&P affirmed all ratings on TelePacific, a competitive local exchange carrier, including the 'B-' corporate credit rating. "The outlook revision on TelePacific reflects improved operating and financial performance since the acquisitions of MPower Communications and Arrival Communications last year," said Standard & Poor's credit analyst Allyn Arden. The purchase of MPower, in particular, eliminated a major CLEC competitor, giving TelePacific almost half the CLEC lines in its markets in generally underserved areas. During this time period, TelePacific's EBITDA margins have expanded to 21% from around 15% from the realization of about $30 million of operating synergies. S&P expect these trends to continue over the next couple of years, resulting in modest discretionary cash flow generation and leverage lower than the current 6.9x, adjusted for operating leases and including 100% debt-like treatment of the company's preferred stock. Total debt as of June 30, 2007, was about $583 million on an operating lease-adjusted basis and including the current balance of the preferred stock. The ratings reflect a vulnerable business risk profile stemming from significant competition from larger, better-capitalized incumbent telecom operators, the lack of any sustainable competitive advantages, low barriers to entry, market concentration, and a highly leveraged financial profile. Tempering factors include meaningful synergies from recent acquisitions, operating in fast growing markets in California, where CLEC competition is less prevalent, low churn, and expectations for positive discretionary cash flow in 2008. WHEELING-PITTSBURGH: Secures $350 Mil. Revolving Credit Facility ---------------------------------------------------------------- Wheeling-Pittsburgh Corporation has reached an agreement in principle with its lead banks on the terms of a $350 million revolving credit facility to replace its current $225 million facility, and a new $135 million term loan to replace its existing government guaranteed term loan. Wheeling-Pittsburgh expects to close on the new credit facilities prior to its pending combination with Esmark Incorporated. Wheeling-Pittsburgh's intention to refinance and the receipt of a proposal from its lead banks were announced during the company's Aug. 10, 2007, second quarter earnings call. "Upon completion, this interim financing package would enhance the company's near term liquidity by allowing greater access to the company's working capital collateral and would eliminate the financial covenant contained in the existing term loan," James P. Bouchard, chairman and CEO of Wheeling-Pitt stated. "This agreement in principle represents an important next step to facilitate the merger with Esmark. Many people have contributed over the years to this great company, and we wish to thank the Emergency Steel Loan Guarantee board and senators Rockefeller and Byrd. They saved this company in 2003. We also want to thank governors Manchin and Strickland, Leo Girard and the United Steelworkers. Their unflagging support has provided the path forward to accomplish the planned combination of Wheeling- Pittsburgh and Esmark." Details of the financings are being finalized and are subject to change until final documentation is executed and customary closing conditions. Based in Wheeling, West Virginia, Wheeling-Pittsburgh Corp. (NasdaqGM: WPSC) -- http://www.wpsc.com/-- is a steel company engaged in the making, processing and fabrication of steel and steel products using both integrated and electric arc furnace technology. The company manufactures and sells hot rolled, cold rolled, galvanized, pre-painted and tin mill sheet products. The company also produces a variety of steel products including roll formed corrugated roofing, roof deck, floor deck, bridgeform and other products used by the construction, highway and agricultural markets. Going Concern Doubt PricewaterhouseCoopers LLP, in Pittsburgh, expressed substantial doubt about Wheeling Pittsburgh Corp.'s ability to continue as a going concern on Aug. 9, 2007, in its report on the consolidated financial statements included it the company's 10K/A for the year ended Dec. 31, 2006. The auditing firm reported that the company has suffered losses from operations and had negative operating cash flows in the first half of 2007. WORLDSPAN LP: Completes $1.4 Billion Sale Deal with Travelport -------------------------------------------------------------- Travelport Limited, the parent company of the Travelport group of companies, has completed its $1.4 billion acquisition of Worldspan L.P. The deal is expected to improve Travelport's networks of travel brands, content and service offerings while enabling it to succeed in an competitive industry. "With an expanded global footprint and proven track record of customer service and technology leadership, our global team will work to meet the evolving needs of our customers as a more effective and efficient travel distribution provider in a rapidly changing industry," Jeff Clarke, president and CEO of Travelport and chairman of Orbitz Worldwide, said. "We will be working on enhancements and operational efficiencies including systems integrity, fare accuracy, and ease-of-use that capitalize on the GDS knowledge and experience of Galileo and Worldspan." "Galileo will be enhanced by Worldspan's online distribution technology platform, while Worldspan will benefit from Galileo's expanded supplier base and expansive content," Gordon Wilson, president and CEO of the Travelport GDS division, said. "The complementary strengths of both companies will bring improved offerings for our agency and supplier customers, and we are particularly excited about the technology innovations and breadth of services we will be able to bring our suppliers and subscribers in the future." The Travelport GDS division comprises the Galileo and Worldspan businesses; Shepherd Systems, an expert in the field of providing business and marketing intelligence to the travel industry; AiRes, the next generation server based internal airline IT product suite and Thor, a provider of distribution and marketing services to travel-related companies. About Travelport Limited Travelport operates Travelport GDS, comprised of Galileo and Worldspan, and GTA, a wholesaler of travel content. In addition, it also owns a controlling interest in Orbitz Worldwide, an online travel company. Travelport has approximately 6000 employees and now operates in 145 countries. Travelport is a private company owned by The Blackstone Group of New York, Technology Crossover Ventures of Palo Alto, California and One Equity Partners of New York. About Worldspan L.P. Headquartered in Atlanta, Georgia, Worldspan L.P. - http://www.worldspan.com/-- is into travel technology services for travel suppliers, travel agencies, e-commerce sites and corporations worldwide. Worldspan provides comprehensive electronic data services linking thousands of travel suppliers around the world to a customer base. * * * As reported in the Troubled Company Reporter on March 28, 2007, Standard & Poor's Ratings Services affirmed its ratings, including the 'B' corporate credit rating, on Worldspan L.P., following the downgrade of its intended merger partner, Travelport LLC, to 'B' from 'B+'. Moody's Investor Services placed Caa1 on senior subordinate rating. WR GRACE: PI Committee Wants Charter Oak as Financial Advisor ------------------------------------------------------------- The Official Committee of Asbestos Personal Injury Claimants of W.R. Grace & Co. and its debtor-affiliates has retained L. Tersigni Consulting, P.C., as its financial advisor since 2001. In May 2007, Mr. Tersigni died. After Mr. Tersigni's death, Elihu Inselbuch, Esq., at Caplin & Drysdale Chartered, in New York, lead counsel for the PI Committee, discovered that, in fee applications filed in the bankruptcy courts, Mr. Tersigni had arbitrarily increased time entries submitted by its employees. Because of this discovery, the PI Committee withdrew pending applications filed by L. Tersigni and saw to it that no further payments were to be made to the firm. The PI Committee also terminated its engagement of L. Tersigni. Mr. Inselbuch tells the U.S. Bankruptcy Court for the District of Delaware that Bradley Rapp, James Sinclair, and Robert Lindsay, all former senior professionals at L. Tersigni, have offered financial advisory services to the PI Committee through a new firm, Charter Oak Financial Consultants, LLC. The PI Committee believes that hiring Charter Oak will allow them to retain the benefit of Messrs. Rapp, Sinclair, and Lindsay's knowledge of issues and information significant to the case while avoiding delays that would be incurred if the PI Committee were forced to find and hire another firm. Thus, the PI Committee seeks the Court's authority to retain Charter Oaks as its financial advisor, nunc pro tunc to July 30, 2007. As financial advisor, Charter Oak will: (a) oversee the PI Committee's fulfillment of its responsibilities by monitoring the financial affairs of the Debtor's and their affiliates and subsidiaries; (b) interpret and analyze financial materials, including accounting, tax, statistical, financial and economic data, regarding the Debtors; (c) analyze and advice the PI Committee regarding accounting, financial, valuation, and related issue that may arise in the course of the proceeding; (d) assist the PI Committee's co-counsel in the evaluation and preparation of avoidance power claims and any other potential litigation, as requested; (e) analyze and advice regarding settlement negotiations and any potential plan of reorganization; and (f) testify as an expert on financial matters, if requested. Charter Oak will be paid for its services based on the firm's hourly billing rates: Professional Hourly Rate ------------ ----------- Senior Managing Directors $535 Director $500 Analyst $200 The PI Committee believes that Charter Oak is "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. About W.R. Grace Headquartered in Columbia, Md., W.R. Grace & Co. (NYSE:GRA) -- http://www.grace.com/-- supplies catalysts and silica products, especially construction chemicals and building materials, and container products globally. The Company and its debtor-affiliates filed for chapter 11 protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139). James H.M. Sprayregen, Esq., at Kirkland & Ellis, and Laura Davis Jones, Esq., at Pachulski, Stang, Ziehl, Young, Jones & Weintraub, P.C., represent the Debtors in their restructuring efforts. The Debtors hired Blackstone Group, L.P., for financial advice. PricewaterhouseCoopers LLP is the Debtors' accountant. Stroock & Stroock & Lavan LLP represent the Official Committee of Unsecured Creditors. The Creditors Committee tapped Capstone Corporate Recovery LLC for financial advice. David T. Austern, the legal representative of future asbestos personal injury claimants, is represented by Orrick Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA. Anderson Kill & Olick, P.C., represent the Official Committee of Asbestos Personal Injury Claimants. The Asbestos Committee of Property Damage Claimants tapped Martin W. Dies, III, Esq., at Dies & Hile L.L.P., and C. Alan Runyan, Esq., at Speights & Runyan,to represent it. Lexecon, LLP, provided asbestos claims consulting services to the Official Committee of Equity Security Holders. The Debtors' filed their Chapter 11 Plan and Disclosure Statement on Nov. 13, 2004. On Jan. 13, 2005, they filed an Amended Plan and Disclosure Statement. The hearing to consider the adequacy of the Debtors' Disclosure Statement began on Jan. 21, 2005. The Debtors' exclusive period to file a chapter 11 plan expired on July 23, 2007. At Dec. 31, 2006, the W.R. Grace's balance sheet showed total assets of $3,620,400,000 and total debts of $4,189,100,000. (W.R. Grace Bankruptcy News, Issue No. 136; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). YRC WORLDWIDE: Stephen Bruffett Replaces Don Barger as EVP & CFO ---------------------------------------------------------------- YRC Worldwide Inc. has named Stephen Bruffett to succeed Don Barger as executive vice president and chief financial officer effective Sept. 1, 2007. Mr. Barger will be retiring and to ensure a smooth transition will stay on in an advisory capacity over the next few months. "Steve is uniquely qualified to fill this position," Bill Zollars, chairman, president and ceo of YRC Worldwide, said. "He has held numerous corporate finance positions and was instrumental in helping develop and support our China strategy. He also has gained operating experience at Yellow Transportation." Mr. Bruffett, currently senior vice president sales and marketing for YRC National Transportation, has been with the organization since 1998. He has an undergraduate degree in Finance from the University of Arkansas and an MBA from the University of Texas. "I would personally like to thank Don for his numerous contributions as our chief financial officer over the past 6 years," Mr. Zollars stated. "Under his leadership, he has managed our financial plan to successfully close two acquisitions that tripled the size of our company, and to support our expansion into China. Don has effectively managed our relationships with our investor community and has developed our financial talent base. He has been a great asset to YRC Worldwide and has done an excellent job in leading our finance organization and our company to position us for futuresuccess as the leader in global transportation and logistics services." Based in Overland Park, Kansas, YRC Worldwide Inc. (Nasdaq: YRCW) fka Yellow Roadway Corp. -- http://www.yrcw.com/-- is a transportation service providers in the world, is the holding company for a portfolio of brands including Yellow Transportation, Roadway, Reimer Express, Meridian IQ, New Penn, USF Holland, USF Reddaway, and USF Glen Moore. The enterprise provides transportation services, transportation management solutions and logistics management. The portfolio of brands represents a comprehensive array of services for the shipment of industrial, commercial and retail goods domestically and internationally. YRC Worldwide employs approximately 66,000 people. * * * Moody's Investor Services placed Ba1 on YRC Worldwide Inc.'s long term corporate family rating and probability of default on Sept. 2006. The outlook is stable. * Business Bankruptcy Rates Continue to Rise in 2007 ---------------------------------------------------- The number of United States business bankruptcies continues to rise in 2007, as the second quarter filings showed yet another dramatic increase in the number of businesses seeking protection from creditors. The increase continues to reflect the business insolvency forecast produced by leading accounts receivable insurer Euler Hermes ACI earlier this year. According to the U.S. Bankruptcy Courts, 6,705 businesses declared bankruptcy in the second quarter of 2007. This number shows a series of upward trends, including: * A 7% increase over the first quarter of 2007 * A 38% year-over-year increase from the second quarter of 2006 * A 45% increase for the first half of 2007 in comparison to the first half of 2006 "Businesses today are facing serious headwinds, including a slowing economy and an increase in the cost of doing business," Euler Hermes ACI Chief Economist Daniel C. North said, who earlier this year forecasted a 51% increase in business bankruptcies for 2007. Mr. North has said that the three most serious issues remain the effects of increased energy, raw material, and labor costs; the effects of monetary policy tightening by the Federal Reserve in 2004-2006; and the "decimated" housing market and its effects on consumers and businesses. The housing market's recent effects on the financial markets have brought the seriousness of the situation to light, but North has been tracking -- and predicting -- the economic impact for nearly a year. "What first tipped me off was when median prices on existing homes fell for 10 consecutive months on a year-over-year basis, which is an unprecedented event since house prices almost never fall; they have never fallen for more than two months in a row in the 38 years that records have been kept," he said. "This is an obvious sign of a rapidly deflating asset bubble, the effects of which will continue to be felt for some time to come." According to the Euler Hermes business failures forecast, a return to 30,000 business bankruptcies is expected in 2007. This follows a spectacular, but one-off, reduction in business failures in 2006, when the number of corporate insolvencies dropped by 50% due to a 2005 change in U.S. bankruptcy legislation. North said the disappearance of the impact of the change in legislation, coupled with the slowing economy and reduced profits, with bring the bankruptcy numbers to "more normal levels." With business bankruptcy levels increasing, business leaders will need to be more vigilant regarding their B-to-B accounts receivable by utilizing accounts receivable management products and services, such as trade credit insurance and third-party commercial collections. About Euler Hermes Headquartered in Owings Mills, MD, Euler Hermes ACI -- http://www.eulerhermes.com/usa-- is North America's oldest and largest provider of trade credit insurance and accounts receivable management solutions and is the U.S. subsidiary of the Euler Hermes Group. The company protects and insures more than $150 billion in U.S. trade transactions annually. It also provides a suite of receivables management services that includes commercial third party collections, receivables management outsourcing, and international collections. Euler Hermes is the leader in credit insurance and bonding and guarantees. The company offers services for the management of customer receivables and posted a consolidated turnover of 2.01 billion euros in 2006. Euler Hermes, a subsidiary of AGF and a member of Allianz, is listed on Euronext Paris. Standard & Poor's rates the group and its principal credit insurance subsidiaries AA-. * Donlin Recano to Provide Puig Inc. Chapter 11 Bankruptcy News --------------------------------------------------------------- Donlin Recano and Company Inc. will provide web-based information services to creditors in the bankruptcy case of Puig Inc. Puig Inc. and its debtor-affiliates filed for Chapter 11 bankruptcy protection on May 29, 2007, in the United States Bankruptcy Court of the Southern District of Florida. Donlin Recano has been retained by the court as the Communications Agent for the Official Committee of Unsecured Creditors in the case. The firm will establish and maintain the information Website for the case, which is designed to assist creditors in their understanding of the bankruptcy process. Peter D. Russin, Esq., of Meland Russin and Budwick P.A., is representing the Committee of Unsecured Creditors in the case. The site provides easy access to general case information, case highlights, creditor questions and answers, case dockets, links to other case sites and the ability to ask a question of the Committee's attorneys. "The Web is now the best way for creditors to have easy access to case information and be able to find what they need in a fast and uncomplicated way" Managing Director at Donlin Recano, Scott Y. Stuart, Esq., said. "We're committed to making the interface as simple and straight forward for them as possible." About Puig Inc. Puig Inc. in Hialeah, Florida, and its debtor-affiliates are engaged in the condo conversion business. Historically, the Debtors have purchased multi-family residential complexes, remodeled the units, converted the projects to condominium ownership and resold the units at retail. The Debtors filed for a chapter 11 protection on May 29, 2007 (Bankr. S.D. Fla. Case No. 07-14026). Jordi Guso, Esq., at Berger Singerman, P.A. represents the Debtors in its restructuring efforts. When the Debtors sought protection from its creditors, they listed total assets and total debts between $1 Million to $100 Million. About Donlin Recano Headquartered in New York City, Donlin Recano -- http://www.donlinrecano.com/-- is a claims management company that has served over 200 national clients across a broad range of industries and business sectors. Working with counsel, turnaround advisors and the affected company, Donlin Recano helps organize and guide Chapter 11 clients through administrative bankruptcy tasks, including provision of Web site-accessible information, formation of professional call centers, management of claims, balloting, distribution and other administrative services. The company also provides Web based information services for creditors committees as required by The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005. * Mark Redmiles Appointed as EOUST's Deputy Director ---------------------------------------------------- Mark A. Redmiles has been appointed as Deputy Director of the Executive Office for United States Trustees, effective Aug. 19, 2007, Clifford J. White III, Director of the Executive Office for United States Trustees disclosed in an EOUST press release . Mr. Redmiles has served since December 2004 as Chief of the U.S. Trustee Program's Civil Enforcement Unit, which employs civil law remedies to protect against abuse of the bankruptcy system by debtors, creditors, attorneys, bankruptcy petition preparers, and others. Mr. Redmiles guided the Program's implementation of the civil enforcement provisions in the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA), and served as a Program representative to the U.S. Judicial Conference's Advisory Committee on Bankruptcy Rules, assisting in the development of new bankruptcy rules and forms. He also frequently represents the Program as a panel member at national bankruptcy conferences and seminars. Mr. Redmiles joined the Program in February 2002, after spending more than 11 years in private practice in Denver, specializing in bankruptcy law and litigation. He received his law degree from Duke University School of Law in Durham, N.C. The U.S. Trustee Program is the component of the Justice Department that protects the integrity of the bankruptcy system by overseeing case administration and litigating to enforce the bankruptcy laws. The Program has 21 regions and 95 field offices, as well as an Executive Office in Washington, D.C. * Chapter 11 Cases with Assets & Liabilities Below $1,000,000 ------------------------------------------------------------- Recent Chapter 11 cases filed with assets and liabilities below $1,000,000: In Re Sunnyside Holdings, L.L.C. Bankr. D. Ariz. Case No. 07-01530 Chapter 11 Petition filed August 15, 2007 See http://bankrupt.com/misc/azb07-01530.pdf In Re Balboa Threadworks, Inc. Bankr. C.D. Calif. Case No. 07-14823 Chapter 11 Petition filed August 15, 2007 See http://bankrupt.com/misc/cacb07-14823.pdf In Re I.C.M. Holdings II, L.L.C. Bankr. M.D. Fla. Case No. 07-07220 Chapter 11 Petition filed August 15, 2007 See http://bankrupt.com/misc/flmb07-07220.pdf In Re Peralta Food Corp. Bankr. S.D. Fla. Case No. 07-16508 Chapter 11 Petition filed August 15, 2007 See http://bankrupt.com/misc/flsb07-16508.pdf In Re J.&I., L.L.C. Bankr. S.D. N.Y. Case No. 07-12598 Chapter 11 Petition filed August 15, 2007 See http://bankrupt.com/misc/nysb07-12598.pdf In Re Sports Medicine Concepts, Inc. Bankr. W.D. N.Y. Case No. 07-22067 Chapter 11 Petition filed August 15, 2007 See http://bankrupt.com/misc/nywb07-22067.pdf In Re M.B. Liquidators, Inc. Bankr. S.D. Ohio Case No. 07-56389 Chapter 11 Petition filed August 15, 2007 See http://bankrupt.com/misc/ohsb07-56389.pdf In Re Agapao Flowers & Gifts, Inc. Bankr. M.D. Penn. No. 07-02520 Chapter 11 Petition filed August 15, 2007 See http://bankrupt.com/misc/pamb07-02520.pdf In Re Jerry Woods Revocable Living Trust Bankr. C.D. Calif. Case No. 07-12502 Chapter 11 Petition filed August 15, 2007 Filed as Pro Se In Re Houston Club Company, Inc. Bankr. S.D. Tex. Case No. 07-35584 Chapter 11 Petition filed August 15, 2007 Filed as Pro Se In Re Stonecrest Family Dentistry, L.L.C. Bankr. N.D. Ga. Case No. 07-73178 Chapter 11 Petition filed August 16, 2007 See http://bankrupt.com/misc/ganb07-73178.pdf In Re Scroggins Nursing & Home Services, Inc. Bankr. S.D. Ind. Case No. 07-91699 Chapter 11 Petition filed August 16, 2007 See http://bankrupt.com/misc/insb07-91699.pdf In Re Wanca Corporation Bankr. D. P.R. Case No. 07-04606 Chapter 11 Petition filed August 16, 2007 See http://bankrupt.com/misc/prb07-04606.pdf In Re Precision Automated Machining, Inc. Bankr. D. Colo. Case No. 07-19162 Chapter 11 Petition filed August 17, 2007 See http://bankrupt.com/misc/cob07-19162.pdf In Re Centers for Long Term, Centers for Long Term Care of Bonner Springs, Inc. Bankr. D. Nev. Case No. 07-15125 Chapter 11 Petition filed August 17, 2007 See http://bankrupt.com/misc/nvb07-15125.pdf In Re Pierce Realty Corporation Bankr. S.D. Ohio Case No. 07-13888 Chapter 11 Petition filed August 17, 2007 See http://bankrupt.com/misc/ohsb07-13888.pdf In Re Donna Jean Wyatt Bankr. E.D. Calif. Case No. 07-12554 Chapter 11 Petition filed August 17, 2007 Filed as Pro Se In Re S.B.W. Management Group, L.L.C. Bankr. E.D. Ark. Case No. 07-14466 Chapter 11 Petition filed August 17, 2007 Filed as Pro Se In Re Tanglewood Church of Christ, Inc. Bankr. W.D. Tenn. Case No. 07-27802 Chapter 11 Petition filed August 17, 2007 See http://bankrupt.com/misc/tnwb07-27802.pdf In Re Our Back Yard, L.L.C. Bankr. N.D. Ala. Case No. 07-82145 Chapter 11 Petition filed August 20, 2007 See http://bankrupt.com/misc/alnb07-82145.pdf In Re Fairfax Collective, Inc. Bankr. C.D. Calif. Case No. 07-17209 Chapter 11 Petition filed August 20, 2007 See http://bankrupt.com/misc/cacb07-17209.pdf In Re Always P.K. Inc. Bankr. E.D. N.Y. Case No. 07-73198 Chapter 11 Petition filed August 20, 2007 See http://bankrupt.com/misc/nyeb07-73198.pdf In Re George C. Scott, III Bankr. D. Mass. Case No. 07-15215 Chapter 11 Petition filed August 20, 2007 Filed as Pro Se In Re Michael P. Vanhall Bankr. D. Ariz. Case No. 07-01563 Chapter 11 Petition filed August 20, 2007 Filed as Pro Se In Re The Comdo Group, L.L.C. Bankr. E.D. Tenn. Case No. 07-32665 Chapter 11 Petition filed August 20, 2007 Filed as Pro Se In Re Next Level Properties, L.L.C. Bankr. D. Ariz. Case No. 07-01573 Chapter 11 Petition filed August 20, 2007 Filed as Pro Se In Re Gary Michael Johnson Bankr. D. Utah Case No. 07-23845 Chapter 11 Petition filed August 20, 2007 See http://bankrupt.com/misc/utb07-23845.pdf In Re Johnson Production Services, Inc. Bankr. D. Utah Case No. 07-23846 Chapter 11 Petition filed August 20, 2007 See http://bankrupt.com/misc/utb07-23846.pdf In Re J.P.S. Rents, Inc. Bankr. D. Utah Case No. 07-23847 Chapter 11 Petition filed August 20, 2007 See http://bankrupt.com/misc/utb07-23847.pdf In Re Kermit Douglas Brooms Bankr. N.D. Calif. Case No. 07-52524 Chapter 11 Petition filed August 21, 2007 Filed as Pro Se In Re Remember When Diner, Inc. Bankr. D. N.H. Case No. 07-11735 Chapter 11 Petition filed August 15, 2020 See http://bankrupt.com/misc/nhb07-11735.pdf ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers' public debt and equity securities about which we report. Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than $3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. A list of Meetings, Conferences and Seminars appears in each Wednesday's edition of the TCR. Submissions about insolvency- related conferences are encouraged. Send announcements to 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, Shimero R. Jainga, Ronald C. Sy, Joel Anthony G. Lopez, Cecil R. Villacampa, Jason A. Nieva, Melanie C. Pador, Ludivino Q. Climaco, Jr., Loyda I. Nartatez, Tara Marie A. Martin, John Paul C. Canonigo, Sheena R. Jusay, and Peter A. Chapman, Editors. Copyright 2007. All rights reserved. ISSN: 1520-9474. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR subscription rate is $775 for 6 months delivered via e- mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Christopher Beard at 240/629-3300. *** End of Transmission ***