/raid1/www/Hosts/bankrupt/TCR_Public/080121.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Monday, January 21, 2008, Vol. 12, No. 17
Headlines
9338 1/2 HAZEN: Voluntary Chapter 11 Case Summary
ACXIOM CORPORATION: Names John Meyer as CEO and President
ADAMS SQUARE: Moody's Slashes Ratings on Three Notes to 'C'
ADVANCED MICRO: Posts $1.772 Billion Net Loss in 2007 4th Quarter
AEROSYSTEMS INC: Jetliner Delivery Delays Cue S&P's Neg. Outlook
AIRBORNE HEALTH: S&P Puts B- Corp. Rating Under Negative Watch
ALGOMA STEEL: Moody's Cuts Speculative Grade Liquidity Rating
AMERICAN AXLE: 558 UAW Workers Opt for Buy-Outs
AMORTIZING RESIDENTIAL: Moody's Junks Rating on Class M-3 Trust
AMPEX CORP: Standstill Agreement With Hillside Capital Expires
ASARCO LLC: Wants Plan-Filing Deadline Extended Until April 11
ASCENDIA BRANDS: Closes Refinancing; Gets $26.5 Mil. from Prentice
ASSOCIATED ESTATES: Posts $2.8 Million Net Loss in 2007 3rd Qtr.
ATLAS ENERGY: Reports $250 Million Sale of Senior Unsec. Notes
BANCO INDUSTRIAL: Moody's Holds Ba3 Rating on Currency Deposits
BANK OF NEW YORK: Moody's Keeps B+ Financial Strength Rating
BAYVIEW FINANCIAL: Fitch Cuts Rating on Class B-3 Certs. to BB
BENCHMARK ELECTRONICS: Moody's Retains Ba3 Corp. Family Rating
BEVERLY HILLS: Voluntary Chapter 11 Case Summary
CABELA CREDIT: S&P Puts BB Preliminary Rating on Class D Notes
CARGO CONNECTION: Unit's Lease Termination Eliminates $1 Mil. Debt
CITADEL BROADCASTING: Moody's Keeps Ba3 Corporate Family Rating
CLASS V FUNDING: Poor Credit Quality Cues Moody's Rating Review
CLEAR CHANNEL: Extends Key Dates for Senior Notes Tender Offer
COASTAL BAGELS: Voluntary Chapter 11 Case Summary
CONGOLEUM CORP: Files Amended Chapter 11 Plan of Reorganization
COUNTRYWIDE ALT-A: Fitch Junks Ratings on 22 Transactions
DANIEL MCELHERAN: Case Summary & Ten Largest Unsecured Creditors
DENVER RADIO: Gets Interim OK to Use Lender's Cash Collateral
DENVER RADIO: Inks $5,000,000 DIP Financing Pact With Full Circle
DESTINY HOSPICE: Case Summary & 20 Largest Unsecured Creditors
DOMAIN INC: Files for Chapter 11 Protection in Delaware
DOMAIN INC: Case Summary & 30 Largest Unsecured Creditors
EL RANCHO: Voluntary Chapter 11 Case Summary
FEDDERS CORP: Court Extends Plan Filing Deadline Until February 29
FEDDERS CORP: Completes $7.5 Million Sale of Affiliate's Assets
FIRST NLC: Files for Chapter 11 Protection in West Palm, Florida
FIRST NLC: Case Summary & 20 Largest Unsecured Creditors
FISHER COMMS: Moody's Gives Positive Outlook on Good Operations
GAP INC: Names Sabrina Simmons as Chief Financial Officer
GCI INC: Moody's Puts Ba3 Rating on Review for Likely Downgrade
GENSOLLEN LLC: Voluntary Chapter 11 Case Summary
GLOBAL PAYMENT: Gets Finance Facility from Andre Soussa's Cos.
GLOBECAT LTD: Moody's Attaches Low-B Ratings on Three Note Classes
GOODYEAR TIRE: Holders Can Convert 4% Senior Notes Until March 31
GRANT PRIDECO: Earns $124.2 Million in 2007 Third Quarter
GREY WOLF: Earns $35.6 Million in 2007 Third Quarter
GROMWELL LLC: Voluntary Chapter 11 Case Summary
HARRAH'S ENT: Hamlet Merger Wrap-Up Cues Securities Delisting
HARRAH'S ENT: S&P Cuts Ratings on $47.6 Bil. of Existing Notes
HEALTH MANAGEMENT: Poor Profitability Cues Fitch to Cut Ratings
HOVNANIAN ENT: Moody's Cuts All Ratings on Projected Recession
INDYMAC BANK: Moody's Lowers Long Term Deposit Rating to Ba3
INTERACTIVE SYSTEMS: Net Loss Slides to $2.42MM in Fiscal 2007
INVACARE CORP: President Gerald Blouch Assumes Acting CFO Role
JONES CREEK: Case Summary & 20 Largest Unsecured Creditors
JOSEPH RECKELHOFF: Case Summary & 14 Largest Unsecured Creditors
JPMORGAN CHASE: Moody's Places Financial Strength Rating at B2
LE-NATURE'S INC: Giant Eagle to Re-Open Newly Bought Latrobe Plant
LEHMAN MORTGAGE: Moody's Downgrades Ratings on Four Tranches
LEVITT AND SONS: Lee County Property Bid Deadline is January 28
LIFEPOINT HOSPITALS: Earns $28.2 Million in 2007 Third Quarter
M/I HOMES: Moody's Slashes Ratings; Retains Negative Outlook
MARCAL PAPER: Files Second Amended Disclosure Statement
MARCAL PAPER: Amended Plan Confirmation Hearing Set for Feb. 22
MARCAL PAPER: Court OKs $160 Mil. Assets Sale to NexBank SSB
MARIFDARR INC: Case Summary & Seven Largest Unsecured Creditors
MARK IV: Moody's Holds B3 Corp. Family Rating w/ Negative Outlook
MBIA INSURANCE: Volatile Risks Prompt Moody's Rating Reviews
MERITAGE HOMES: Moody's Downgrades Corp. Family Rating to B1
MERRILL LYNCH: Moody's Lowers Ratings on 19 Tranches
MODERN TECH: Reports Strategies to Increase Shareholder Equity
MQ ASSOCIATES: S&P Withdraws Ratings After Receipt of Consents
NATIONAL COAL: Business Reasons Cue Moody's to Vacate Ratings
NEFF CORP: S&P Changes Outlook to Negative on Market Weakness
NEPHROS INC: Notes Issuance Ups Stockholders' Equity to $10.2 Mil.
OCEANVIEW CBO: Poor Credit Quality Spurs Moody's Ratings Review
OVERSEAS SHIPHOLDING: Earns $26.6 Million in 2007 Third Quarter
OVERSEAS SHIPHOLDING: S&P Chips Rating to 'BB' on Weak Profile
PARMALAT SPA: Creditors Convert Warrants for 61,626 Shares
PARMALAT SPA: Reaches EUR310,000,000 Settlement Pact with Intesa
PATRICIA BARNES: Case Summary & Two Largest Unsecured Creditors
PLASTECH ENGINEERED: S&P Chips Rating to B- on Tight Liquidity
PROPEX INC: Files Chapter 11 Protection; To Continue Operations
PROPEX INC: Case Summary & 30 Largest Unsecured Creditors
PROSPECT MEDICAL: S&P Cuts Rating to B- on Adverse Development
RADIANT ENERGY: Inks Debt-to-Equity Swap With Two Companies
RITCHIE CAPITAL: Court OKs Sale of Two Ireland Units for $452.5MM
ROLAND ROAD: Voluntary Chapter 11 Case Summary
SCAN INTERNATIONAL: Wells Fargo DIP Pact Gets Interim Court Okay
SNOHOMISH COUNTY: S&P Cuts Rating on $14MM Revenue Bonds to BB+
STANDARD PACIFIC: Moody's Cuts Corporate Family Rating to B1
SUN MICROSYSTEMS: Moody's Ba1 Rating Unmoved by MySQL $1BB Deal
SYNIVERSE TECH: Reports 2007 Full Year Preliminary Results
TALON FUNDING: Moody's Cuts Rating on $31.25 Mil. Notes to Ca
TEEKAY CORP: Earns $17 Million in 2007 Third Quarter
TOTAL VEIN: Voluntary Chapter 11 Case Summary
TOUSA INC: S&P Slashes Rating on $200 Million Senior Notes to D
TRAINER WORTHAM: Moody's Reviews B2 Rating on $23 Million Notes
TRIGEM COMPUTER: Representative Files 5th Section 1518(1) Report
TRIGEM COMPUTER: Wants Toshiba's Prepetition Lawsuit Enjoined
TRUEYOU.COM INC: Sept. 29 Balance Sheet Upside-Down by $75.4 Mil.
UAP HOLDING: Paying $0.225/Share Qtrly. Dividend on February 15
VESTA INSURANCE: Florida Select Wants Exclusive Period Extended
VOUGHT AIRCRAFT: S&P Changes Outlook to Negative from Developing
WESTWAYS FUNDING: Moody's Reviews B2 Rating on Class D Notes
WINSTAR COMMUNICATIONS: Lucent Files Reply Brief
* Fitch Says US CMBS Delinquencies Are Likely to Triple
* Fitch Says US Retail Industry Outlook Remains Challenging
* S&P Cuts Ratings on 95 Tranches From 23 Cash Flows and CDOs
* Cozen Forms New Practice Group to Address Credit Market Crisis
* Data Shows Public Bankruptcy Filings Up in 2007
* MBA Reports on 3Q 2007 Mortgage Loan Modification and Repayment
* BOND PRICING: For the Week of Jan. 14 - Jan. 18, 200
*********
9338 1/2 HAZEN: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: 9338 1/2 Hazen Drive, L.L.C.
67 West Dayton Street
Los Angeles, CA 91105
Bankruptcy Case No.: 08-10685
Chapter 11 Petition Date: January 17, 2008
Court: Central District Of California (Los Angeles)
Judge: Samuel L. Bufford
Debtor's Counsel: Evan L. Smith, Esq.
Morris & Smith, Attorneys at Law
150 North Santa Anita Avenue, Suite 750
Arcadia, CA 91006
Tel: (626) 294-0880
Fax: (626) 294-0884
Estimated Assets: $1 Million too $10 Million
Estimated Debts: $1 Million too $10 Million
The Debtor does not have any creditors who are not insiders.
ACXIOM CORPORATION: Names John Meyer as CEO and President
---------------------------------------------------------
Acxiom(R) Corporation's Board of Directors has named John Meyer to
serve as the company's chief executive officer and president.
Mr. Meyer, 51, has been president of the Global Services group of
Alcatel-Lucent since 2003. Prior to joining Lucent, Mr. Meyer
spent almost 20 years in a number of high-profile positions at EDS
that included Chairman of the Europe, Middle East and Africa
Operating Team, President of Diversified Financial Services and
Credit Services Divisions, and CIO for the company's GMAC
business. Mr. Meyer's global, multi-industry experience at EDS
was marked by numerous successes, including doubling revenue in
EMEA from $3.6 billion to $7.2 billion in four years. Before
entering the business world, Mr. Meyer served as a flight
commander and was selected as a captain in the U.S. Air Force.
Michael Durham, Acxiom's non-executive chairman, said the board
unanimously selected Meyer because of his demonstrated strong
leadership skills, his broad experience in the information
technology industry and his history of success in building
shareholder value.
"Since October, the board has been focused on the search for a new
leader in its efforts to return Acxiom to sustained success," Mr.
Durham said. "John commanded our attention because of his strong
execution skills, his ability to lead high-performing teams and
his track record in driving shareholder value. He has
demonstrated these skills at both Alcatel-Lucent and EDS as he ran
businesses that are substantially larger and more complex than
Acxiom. As we learned more about John, we were equally impressed
by his focus on developing internal talent while reaching outside
for new skills. His straightforward style and integrity impressed
us as it has his employees, clients and investors in his previous
roles. John's track record has established him as one of the most
accomplished services leaders in the technology industry."
Mr. Meyer said that "Acxiom's position as the leading provider of
offline and online marketing services is the envy of the market.
Acxiom's proud history of innovation and delivery excellence has
created value for its clients for decades. It is an honor to join
the company and do all I can to build on its successes. I look
forward to working with our associates to create value for our
clients and shareholders."
Mr. Meyer will join Acxiom on February 4. He also will serve as a
member of Acxiom's board of directors. He succeeds Charles
Morgan, a 35-year company veteran who has been Chairman and Chief
Executive Officer since 1975. Morgan, who announced his
retirement in October, will remain a consultant to the company
through 2010.
"John's go-to-market, operational and technology skills in leading
a large services business are impressive," Mr. Morgan said. "I
leave Acxiom in the capable hands of a leader who has a strong
client focus and will continue to bring out the best in the teams
he leads."
Mr. Meyer, his wife Victoria and their three children live in
Dallas, Texas and will be moving to Little Rock, Acxiom's
headquarters, as soon as practical.
Headquartered in Little Rock, Arkansas, Acxiom Corporation,
(Nasdaq: ACXM) -- http://www.acxiom.com/-- designs, builds and
manages marketing solutions across offline and online channels for
many of the largest, most respected companies in the world. The
core components of Acxiom's services include data integration
technology, data and analytics products, database services, IT
outsourcing, consulting and campaign management software. Founded
in 1969, Acxiom has locations throughout the United States and
Europe, and in Australia, China and Canada.
* * *
As reported in the Troubled Company Reporter on Dec. 17, 2007,
Moody's Investors Service confirmed Acxiom's Ba2 corporate family
rating and assigned a negative rating outlook, concluding a review
for possible downgrade initiated on May 17, 2007, following the
company's announcement that it had entered into a definitive
agreement to be acquired by Silver Lake and ValueAct Capital for
$3 billion.
ADAMS SQUARE: Moody's Slashes Ratings on Three Notes to 'C'
-----------------------------------------------------------
Moody's Investors Service downgraded and left on review for
possible downgrade these notes by Adams Square Funding II, Ltd.
1) Class Description: $15,200,000 Class S Floating Rate Notes Due
2014
-- Prior Rating: Aaa, on review for possible downgrade
-- Current Rating: Ba1, on review for possible downgrade
2) Class Description: $600,000,000 Class A1 Floating Rate Notes
Due 2047
-- Prior Rating: Aaa, on review for possible downgrade
-- Current Rating: Ba2, on review for possible downgrade
3) Class Description: $95,000,000 Class A2 Floating Rate Notes Due
2047
-- Prior Rating: Baa2, on review for possible downgrade
-- Current Rating: Caa2, on review for possible downgrade
4) Class Description: $140,000,000 Class A3 Floating Rate Notes
Due 2047
-- Prior Rating: Ba1, on review for possible downgrade
-- Current Rating: Caa3, on review for possible downgrade
5) Class Description: $50,000,000 Class B Deferrable Floating Rate
Notes Due 2047
-- Prior Rating: Ba3, on review for possible downgrade
-- Current Rating: Caa3, on review for possible downgrade
6) Class Description: $10,000,000 Class Q Combination Notes Due
2047
-- Prior Rating: B1, on review for possible downgrade
-- Current Rating: Caa3, on review for possible downgrade
Moody's also downgraded these class of notes:
7) Class Description: $49,000,000 Class C Deferrable Floating Rate
Notes Due 2047
-- Prior Rating: Caa3, on review for possible downgrade
-- Current Rating: C
8) Class Description: $20,000,000 Class D Deferrable Floating Rate
Notes Due 2047
-- Prior Rating: Caa3, on review for possible downgrade
-- Current Rating: C
9) Class Description: $10,000,000 Class E Deferrable Floating Rate
Notes Due 2047
-- Prior Rating: Ca
-- Current Rating: C
According to Moody's, the rating actions are the result of
deterioration in the credit quality of the transaction's
underlying collateral pool, which consists primarily of structured
finance securities.
ADVANCED MICRO: Posts $1.772 Billion Net Loss in 2007 4th Quarter
-----------------------------------------------------------------
Advanced Micro Devices Inc. reported Thursday results of its
fourth quarter and year ended Dec. 29, 2007.
In the fourth quarter of 2007, AMD reported net loss of
$1.772 billion and an operating loss of $1.678 billion. Fourth
quarter net loss included charges of $1.675 billion, of which
$1.669 billion were operating charges. The non-cash portion of
the fourth quarter charges was $1.606 billion.
Fourth quarter 2007 revenue was $1.770 billion, an 8% increase
compared to the third quarter of 2007 and flat compared to the
fourth quarter of 2006.
In the third quarter of 2007, AMD reported revenue of
$1.632 billion, a net loss of $396.0 million, and an operating
loss of $226.0 million. In the fourth quarter of 2006, AMD
reported revenue of $1.773 billion, a net loss $576.0 million, and
an operating loss of $529.0 million.
For the year ended Dec. 29, 2007, AMD achieved revenue of
$6.013 billion, a 6% increase from 2006. The fiscal 2007 net loss
was $3.379 billion. Included in the 2007 net loss were non-cash
charges of $2.007 billion. AMD reported revenue of $5.649 billion
and a net loss of $166.0 million for fiscal 2006.
"We were close to break-even operationally for the quarter,
reducing our fourth quarter non-GAAP operating loss to
$9.0 million. We improved gross margin by three points
sequentially, driven by increased shipments of new products,
higher average selling prices and cost containment actions," said
Robert J. Rivet, AMD's chief financial officer. "We shipped a
record number of microprocessor units in the quarter, including
nearly four hundred thousand quad-core processors."
Fourth quarter 2007 gross margin was 44%, compared to 41% in the
third quarter of 2007 and 36% in the fourth quarter of 2006.
Balance Sheet
At Dec. 29, 2007, the company's consolidated balance sheet showed
$11.550 in total assets, $8.295 billion in total liabilities,
$265.0 million in minority interest in consolidated subsidiaries,
and $2.990 billion in total stockholders' equity.
About Advanced Micro
Headquartered in Sunnyvale, California, Advanced Micro Devices
Inc. (NYSE: AMD) -- http://www.amd.com/-- provides innovative
processing solutions in the computing, graphics and consumer
electronics markets.
* * *
As reported in the Troubled Company Reporter on Aug. 14, 2007,
Standard & Poor's Ratings Services affirmed its B/Negative/--
corporate credit rating on Advanced Micro Devices Inc. At the
same time, S&P assigned its 'B' rating to the company's
$1.5 billion 5.75% senior convertible notes due 2012, and raised
the rating on the company's existing senior unsecured debt to 'B'
from 'B-', because the company no longer has secured debt in its
capital structure.
In addition, Fitch Ratings assigned a 'CCC+/RR6' rating to
Advanced Micro Devices Inc.'s private placement of $1.5 billion
5.75% convertible senior notes due 2012. Fitch also affirmed the
company's Issuer Default Rating at 'B'; and Senior unsecured debt
at 'CCC+/RR6'.
AEROSYSTEMS INC: Jetliner Delivery Delays Cue S&P's Neg. Outlook
----------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on
aerospace supplier Spirit AeroSystems Inc. to negative from
positive. At the same time, Standard & Poor's affirmed its
ratings, including the 'BB' corporate credit rating, on the
company. About $600 million of debt is outstanding.
"The outlook revision reflects the potential for materially
reduced operating cash flow in 2008 as a result of additional
delays announced by Boeing Co. on its new 787 jetliner," said
Standard & Poor's credit analyst Roman Szuper. Although the 787
should be a successful program later this decade and beyond, its
first flight now has been moved to the end of the second quarter
of 2008, from the end of the first quarter, with initial
deliveries to begin in early 2009, rather than late 2008. The
delays will adversely affect working capital and cash flow of most
suppliers, including Spirit. Boeing is in discussions with its
suppliers regarding changes to the contracts, which in many cases
specified that the vendors get paid for their shipments only when
the 787 is certified and delivered to the first customer.
The ratings on Spirit reflect participation in the cyclical and
competitive commercial aerospace industry, reliance on one
customer for about 90% of sales, significant near-term
expenditures related to development of Boeing's 787 aircraft, and
concerns about near-term liquidity. Those factors are offset
somewhat by the company's position as the largest independent
supplier of structures for commercial aircraft, currently strong
market conditions, substantial customer advances to fund most of
the 787 development costs, improving profitability, and a
moderately leveraged capital structure.
Spirit is the former Wichita division of Boeing Commercial
Airplanes that was acquired by Onex Corp., a Canadian private
equity firm, for $920 million in cash in June 2005. The
acquisition was financed with the proceeds from a $700 million
bank term loan and $375 million of cash equity from Onex.
AIRBORNE HEALTH: S&P Puts B- Corp. Rating Under Negative Watch
--------------------------------------------------------------
Standard & Poor's Ratings Services placed its 'B-' corporate
credit rating and all other ratings on Airborne Health Inc. on
CreditWatch with negative implications. This action means that
the ratings could be lowered or maintained following the
completion of Standard & Poor's review. About $154 million total
debt was outstanding at Nov. 30, 2007.
"The CreditWatch placement follows Airborne's weaker-than-expected
operating performance in the recent period, and reflects our
concern that the company may have very tight cushion and may not
be able to meet its financial covenants for the quarter ending
Jan. 31, 2008," said Standard & Poor's credit analyst Bea Chiem.
Bonita Springs, Florida-based Airborne's weak performance is
attributed to unseasonably warm weather during the peak cold
weather season that lowered demand for preventative products.
The company's fiscal year-to-date net revenues and EBITDA through
Nov. 30, 2007, declined 7.7% and 37.8%, respectively, from the
same period in 2006. Year to date, the company incurred higher
sales allowances and general and administrative expenses resulting
in lower operating margins. Total debt leverage (including
preferred stock) increased to nearly 6x, from over 5x at the end
of August 2007.
At present, Airborne's liquidity is adequate, supported by its $23
million in cash at Nov. 30, 2007, and $33.6 million currently.
"However," said Ms. Chiem, "we are concerned about the company's
ability to access its revolver if it does not meet its financial
covenants for the Jan. 31, 2008, quarter-end."
Standard & Poor's will monitor Airborne's operating performance
and ability to meet its financial covenants, and discuss its
financial results and plans with management before resolving the
CreditWatch.
ALGOMA STEEL: Moody's Cuts Speculative Grade Liquidity Rating
-------------------------------------------------------------
Moody's Investors Service affirmed the long-term debt ratings for
Algoma Steel Inc. but lowered its speculative grade liquidity
rating to SGL-4 from SGL-3(B3 CFR) due to concerns about the
company's ability to comply with the financial covenants in its
term loan agreement over the next 12 months.
Algoma's very poor third quarter 2007 results, which resulted in
negative C$37.2 million of as-reported EBITDA, will negatively
impact its maximum leverage ratio and minimum interest coverage
ratio covenants throughout the first half of 2008. In addition,
both financial covenants will steadily tighten over the next 5
quarters, thereby further challenging ongoing covenant compliance.
In order to remain in compliance, Moody's estimates that Algoma's
EBITDA will have to increase by at least 50% over the run rate
from the first half of 2007. This will require Algoma's EBITDA per
ton to rise from around CDN$85/ton to around CDN$115/ton. While
this is possible given recently announced steel industry price
increases of around $100/ton, the industry introduced the price
increases in response to cost increases and, in general, very
little margin improvement is expected.
Algoma, which is not self-sufficient in iron ore and coal, is not
well-positioned in the long term to contain input cost pressures,
although it is possible that the announced price increases will
outpace cost increases in the short term. Nevertheless, Moody's
believes there is a high probability that Algoma will need to seek
covenant waivers or amendments from its term loan lenders. If
Algoma does not maintain compliance, this would result in an event
of default under its other debt, in particular its senior
subordinated notes.
The losses that Algoma experienced in the third quarter were
largely due to the extended downtime taken on its No. 7 Blast
Furnace. The furnace was shutdown for a partial reline in July
2007 and the shutdown lasted 52 days rather than the expected 31
days. As a result of the shutdown, raw steel production was about
55% lower than normal, steel shipments were 436,000 tons, or about
30% lower than in 2Q07 or 3Q06, and Algoma was required to produce
steel from costly purchased slabs and coils, all of which hurt its
sales and costs. As-reported 3Q07 EBITDA was negative
CDN$37.2 million, compared to positive CDN$54 million and
CDN$52 million in 1Q01 and 2Q07, respectively (EBITDA as defined
by the term loan agreement is greater than these reported
figures). Moody's believes that EBITDA in 4Q07 rebounded to Q1
and Q2 levels and that the company will be in compliance with its
term loan financial covenants at Dec. 31, 2007. But, with the
covenants tightening in 2008 (e.g., minimum interest coverage
steps up by 0.25x each quarter and is 3.0x at Dec. 31, 2008),
compliance is uncertain in 2008.
The affirmation of Algoma's ratings and outlook considers a number
of favorable factors that support the ratings and which may make
the lenders amenable to covenant waivers or amendments, if
necessary. These include the one-time nature of the third quarter
losses, the expectation for industry-wide steel price increases in
the first half of 2008, and the fact that Algoma reduced term loan
debt in December by CDN$130 million, using proceeds from the sale
of a 49.9% interest in its 55 megawatt cogeneration power plant.
While it is difficult to predict how lenders will behave in the
current credit environment, Moody's believes that the lenders will
agree to waivers or amendments and, therefore, Moody's is
maintaining its stable outlook for the company. While not
factored into Moody's ratings or outlook, Moody's notes that
Algoma's owner, Essar Steel Holdings Limited, may opt to inject
cash or repay Algoma's debt in order to ensure covenant
compliance.
Moody's previous rating action for Algoma was on June 6, 2007,
when the current long-term debt ratings were assigned, including
the B3 corporate family rating, the B3 senior secured rating and
the Caa1 senior unsecured rating.
Algoma Steel Inc., headquartered in Sault Ste. Marie, Ontario, is
the third largest integrated steel producer in Canada, accounting
for approximately 15% of Canadian raw steel production. About 80%
of Algoma's sales are sheet products, with plate products
accounting for the balance. For the twelve months ended Sept. 30,
2007, Algoma had revenues of CDN$1.75 billion. Algoma's principal
end markets are steel service centers, the automotive industry,
steel fabricators and manufacturers.
AMERICAN AXLE: 558 UAW Workers Opt for Buy-Outs
-----------------------------------------------
American Axle & Manufacturing Holdings Inc. disclosed that 558 UAW
represented associates agreed to participate in AAM's Buffalo
Separation Program, a voluntary separation program that was
offered to approximately 650 UAW represented associates at AAM's
Buffalo Gear, Axle & Linkage facility in Buffalo, New York.
Production at this facility was idled in December 2007.
Under this voluntary separation program, AAM offered a range of
retirement incentives and buy-outs to eligible associates
beginning in September 2007. Associates who retired as part of
this program will retain all vested pension and postretirement
benefits. Associates who accepted a buy-out will retain
vested pension benefits, but forfeited other postretirement
benefits.
On Aug. 14, 2007, AAM estimated that it would incur special
charges of as much as $85 million for the BSP, including pension
and other postretirement benefit curtailments and special
termination benefits.
AAM currently estimates that the total cost of the BSP will
approximate $56 million.
Headquartered in Detroit, Michigan, American Axle & Manufacturing
Holdings, Inc. (NYSE:AXL) -- http://www.aam.com/-- and its wholly
owned subsidiary, American Axle & Manufacturing, Inc.,
manufactures, engineers, designs and validates driveline and
drivetrain systems and related components and modules, chassis
systems and metal-formed products for light trucks, sport utility
vehicles and passenger cars. In addition to locations in the
United States (in Michigan, New York and Ohio), the company also
has offices or facilities in Brazil, China, Germany, India, Japan,
Luxembourg, Mexico, Poland, South Korea and the United Kingdom.
* * *
Moody's Investors Service recently affirmed American Axle &
Manufacturing Holdings Inc.'s Corporate Family rating of Ba3 as
well as the senior unsecured rating of Ba3 to American Axle &
Manufacturing Inc.'s notes and term loan.
AMORTIZING RESIDENTIAL: Moody's Junks Rating on Class M-3 Trust
---------------------------------------------------------------
Moody's Investors Service downgraded Class M-3 issued by
Amortizing Residential Collateral Trust in 2002. The action is
based on the analysis of the credit enhancement provided by
subordination, overcollateralization, excess spread and mortgage
insurance relative to expected losses.
The deal has already stepped down. The small pool factor of less
than 5% combined with a pipeline of loans in foreclosure and REO
has caused protection to the downgraded tranche to be diminished.
As of December 2007, there was $143,158 protection versus a
balance of $3,165,042 in Foreclose and REO. Class M-3 has a
current balance of $125,467 compared to an original balance of
$8,024,000. The transaction is backed by subprime, fixed and
adjustable-rate mortgage loans.
Complete rating actions are:
Issuer: Amortizing Residential Collateral Trust,
Series 2002- BC10
-- Class M-3, current rating B3, downgraded from B3 to C.
AMPEX CORP: Standstill Agreement With Hillside Capital Expires
--------------------------------------------------------------
Ampex Corporation disclosed that its Amended Standstill Agreement
with Hillside Capital Incorporated has been terminated effective
Jan. 14, 2008. Prior to the termination, the company and Hillside
were in the process of negotiating a consensual restructuring of
Ampex's indebtedness to Hillside.
As reported in the Troubled Company Reporter on Nov. 22, 2007,
Ampex Corporation and Hillside Capital have agreed to extend the
standstill agreement until Jan. 15, 2008 in order to afford the
parties additional time to restructure the Hillside Notes
previously issued to fund the company's pension contributions.
To date, such negotiations have been unsuccessful, although
Hillside has expressed its willingness to continue negotiations.
Subsequent to termination of the Amended Standstill Agreement, on
Jan. 15, 2008, Hillside demanded immediate payment of
approximately $1.3 million of outstanding principal due on the
Hillside Notes, and demanded payment of approximately
$1.4 million of accrued interest due on the Hillside Notes within
10 days.
Hillside also reasserted its allegation, disputed by Ampex, that
Ampex has breached its obligations under the Hillside/Ampex-
Sherborne Agreement dated Dec. 1, 1994. During the remainder of
2008, additional payments of principal and interest that are
scheduled to be paid to Hillside are estimated to total
$6.5 million.
If the company fails to pay the $2.7 million of principal and
interest payments that are currently due or to cure the alleged
breach, Hillside would be entitled to accelerate repayment of all
outstanding Hillside Notes and accrued interest, which totaled
$48.7 million at Dec. 31, 2007.
Any acceleration by Hillside would allow holders of the Senior
Notes to accelerate the maturity of those obligations, which
totaled $6.7 million at Dec. 31, 2007. The acceleration of these
debts would require the company to seek protection under federal
bankruptcy laws.
About Ampex Corp.
Headquartered in Redwood City, California, Ampex Corporation
(Nasdaq: AMPX) -- http://www.ampex.com/-- manufactures high
performance data storage products principally used in defense
applications.
Ampex Corporation's consolidated balance sheet at Sept. 30, 2007,
showed $23.3 million in total assets and $123.8 million in total
liabilities, resulting in a $100.5 million total shareholders'
deficit.
Likely Insufficient Financial Resources
Based on its projected operations, the company relates that it
will not have sufficient financial resources or be able to
generate cash flow to service all of its obligations, including
scheduled indebtedness, within the next 12 months and beyond. In
order for the company to remain a going concern it will be
required to substantially modify the repayment terms of its Senior
Notes well as the Hillside Notes.
Alternatively, the company may be required to issue new equity to
holders of all or most of its outstanding debt securities, well as
for debt that will be issued in connection with future pension
plan contributions. Any such issuance of equity for debt would
result in current stockholders' ownership interest being
significantly diluted and potentially cause a substantial decline
in the price of the company's Common Stock. The company cannot
give assurance that it will be successful in restructuring its
indebtedness.
ASARCO LLC: Wants Plan-Filing Deadline Extended Until April 11
--------------------------------------------------------------
Asarco LLC and its debtor-affiliates ask the U.S. Bankruptcy Court
for the Southern District of Texas to further extend:
(i) the exclusive period in which they may file a Chapter 11
plan of reorganization until April 11, 2008, and
(ii) the exclusive period for them to solicit acceptances of
that plan until June 13, 2008.
The Debtors' current exclusive plan filing period will expire on
February 11.
The Debtors assert that extension of their exclusive periods is
warranted. The Debtors need more time to reach a definitive
agreement with two of their largest creditor groups -- the
environmental and asbestos claimants -- on the terms of a
consensual reorganization plan, and the process and procedures
for selecting a Chapter 11 plan sponsor, James R. Prince, Esq.,
at Baker Botts, L.L.P., in Dallas, Texas, tells the Court.
He relates that the Debtors, the Official Committee of Unsecured
Creditors for the Asbestos Subsidiary Debtors, Robert C. Pate,
the Court-appointed future claims representative, and the United
States Department of Justice, have started engaging in mediations
and negotiations in October 2007 regarding the resolution of
environmental and asbestos claims filed against the Debtors.
As of Jan. 18, 2008, the Debtors have concluded environmental
mediation and submitted settlements with respect to 19 out of the
21 environmental sites they own. Mediation on two sites -- the
East Helena and U.S. Section, International Boundary and Water
Commission sites -- will continue until the parties have reached
a settlement, Mr. Prince says.
As for the asbestos claims, Mr. Prince relates that mediation
and presentation of expert reports and evidence are underway.
The Debtors and the asbestos parties are on the process of
entering into a global settlement but that settlement has not
been finalized, he says. Judge Elizabeth Magner, the
Court-appointed asbestos claims mediator, will continue mediation
on the asbestos claims on Jan. 24, 2008.
Mr. Prince adds that the Debtors are finalizing the terms of
several settlement agreements with claimants alleging toxic tort
damages unrelated to asbestos.
He further asserts that the Debtors need the deadline extension
to continue their litigation relating to avoidance action
complaints that if successful, will result in substantial
recovery for the Debtors.
Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/
-- is an integrated copper mining, smelting and refining company.
Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. The
Company filed for chapter 11 protection on Aug. 9, 2005 (Bankr.
S.D. Tex. Case No. 05-21207). James R. Prince, Esq., Jack L.
Kinzie, Esq., and Eric A. Soderlund, Esq., at Baker Botts L.L.P.,
and Nathaniel Peter Holzer, Esq., Shelby A. Jordan, Esq., and
Harlin C. Womble, Esq., at Jordan, Hyden, Womble & Culbreth, P.C.,
represent the Debtor in its restructuring efforts. Lehman
Brothers Inc. provides the ASARCO with financial advisory services
And investment banking services. Paul M. Singer, Esq., James C.
McCarroll, Esq., and Derek J. Baker, Esq., at Reed Smith LLP give
legal advice to the Official Committee of Unsecured Creditors and
David J. Beckman at FTI Consulting, Inc., gives financial advisory
services to the Committee. When the Debtor filed for protection
from its creditors, it listed $600 million in total assets and $1
billion in total debts.
The Debtor has five affiliates that filed for chapter 11
protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521
through 05-20525). They are Lac d'Amiante Du Quebec Ltee, CAPCO
Pipe Company, Inc., Cement Asbestos Products Company, Lake
Asbestos of Quebec, Ltd., and LAQ Canada, Ltd. Details about
their asbestos-driven chapter 11 filings have appeared in the
Troubled Company Reporter since Apr. 18, 2005.
Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle,
Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No. 05-
21346) also filed for chapter 11 protection, and ASARCO has asked
that the three subsidiary cases be jointly administered with its
chapter 11 case. On Oct. 24, 2005, Encycle/Texas' case was
converted to a Chapter 7 liquidation proceeding. The Court
appointed Michael Boudloche as Encycle/Texas, Inc.'s Chapter 7
Trustee. Michael B. Schmidt, Esq., and John Vardeman, Esq., at
Law Offices of Michael B. Schmidt represent the Chapter 7 Trustee.
ASARCO's affiliates, AR Sacaton LLC, Southern Peru Holdings LLC,
and ASARCO Exploration Company Inc., filed for chapter 11
protection on Dec. 12, 2006 (Bankr. S.D. Tex. Case No. 06-20774 to
06-20776).
The Debtors' exclusive period to file a plan expires on Feb. 11,
2008. (ASARCO Bankruptcy News, Issue No. 63; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000).
ASCENDIA BRANDS: Closes Refinancing; Gets $26.5 Mil. from Prentice
------------------------------------------------------------------
Ascendia Brands Inc. disclosed the closing of a recapitalization
of the company and related restructuring of its senior debt
facility.
In the recapitalization, an affiliate of Prentice Capital
Management LP invested $26.5 million in a newly created class of
voting, convertible Series C Preferred Stock. The amount of the
investment includes the conversion of a $2 million unsecured loan
previously provided by an affiliate of Prentice in November 2007.
The effective conversion price of the Series C Preferred Stock is
$0.1236 per share, which represents a discount of 15% off the
average closing price of Ascendia's common stock for the ten
trading days prior to the approval of the transaction by
Ascendia's Board of Directors, which occurred on Dec. 28, 2007.
Ascendia will use the proceeds of the sale to pay down
$1.5 million of its First Lien Term Notes, to pay off the current
balance of $18,403,258 on its revolving credit facility and for
general corporate purposes. The issuance of the Series C
Preferred Stock will trigger the anti-dilution provisions of
certain outstanding warrants and the company's secured convertible
notes.
Holders of the Series C Preferred Stock have the right to appoint
a majority of Ascendia's directors. In connection with the
closing of the transaction, Edward J. Doyle, Kenneth D. Taylor and
Francis G. Ziegler resigned from the Board and the company expects
to announce replacements shortly.
Pact to Restructure Senior Debt
Concurrently with the sale of the Series C Preferred Stock,
Ascendia also entered into an agreement with its senior lenders to
re-structure its First and Second Lien loan facilities.
Under the terms of the restructuring, Ascendia's lenders have
agreed to adjust certain financial covenants through the end of
Ascendia's 2009 fiscal year (ending Feb. 28, 2009), and allow for
the deferral of certain interest payments.
Margins on the senior debt have been increased in consideration of
the financial covenant relief and restructuring and the company
will accrue a fee of up to $2 million to the holders of its Term
Notes A-1.
Move to Delist Shares from AMEX
Ascendia also said that it is notifying the American Stock
Exchange that it will delist from the Exchange and will file a
Form 25 with the Securities and Exchange Commission within 10 days
for the purpose of delisting its Common Stock.
The company is not in compliance with the Exchange's continued
listing standards because its stockholders' equity remains below
the minimum amount required by the Exchange. The company does not
anticipate regaining compliance with this requirement within the
time frame required by the Exchange and accordingly it is
withdrawing its appeal against the current delisting proceeding.
The delisting will become effective 10 days after, and Ascendia
anticipates that its Common Stock will be quoted in the Pink
Sheets. Ascendia will continue to explore other options for the
quotation or listing of its Common Stock.
Steven R. Scheyer, President and Chief Executive Officer of
Ascendia, commented: "We are very pleased to have completed the
recapitalization of the company and the restructuring of our
senior debt. This closing, which is the culmination of several
months work, makes it possible to focus all of the company's
attention on driving sales growth, cost reduction, serving our
customers and delivering value to our shareholders."
Senior Lenders Waive Default
As reported in the Troubled Company Reporter on Jan. 3, 2008,
Ascendia Brands Inc. has reached agreement with its senior lenders
to restructure its $160 million first and second lien debt
facilities. Under the agreement, Ascendia's senior lenders will
waive certain existing covenant defaults and adjust financial
covenant levels from now through the end of Ascendia's fiscal year
ending Feb. 28, 2009.
The TCR reported on Dec. 17, 2007, that Ascendia Brands notified
its senior lenders that it is in default of certain covenants
contained in its first and second lien credit facilities and is
unable to make certain representations and warranties deemed to be
made when drawings are made under its revolving credit facility.
About Ascendia Brands
Headquartered in Hamilton, New Jersey, Ascendia Brands Inc.
-- http://www.ascendiabrands.com/-- is a leader in the value and
premium value segments of the health and beauty care products
sector. In November 2005, Ascendia expanded its range of product
offerings through the acquisition of a series of brands, including
Baby Magic(R), Binaca(R), Mr. Bubble(R) and Ogilvie(R), and in
February 2007 it acquired the Calgon(TM)* and the healing
garden(R) brands. The company operates two manufacturing
facilities, in Binghamton, New York, and Toronto, Canada.
ASSOCIATED ESTATES: Posts $2.8 Million Net Loss in 2007 3rd Qtr.
----------------------------------------------------------------
Associated Estates Realty Corporation reported a net loss of
$2.8 million for the third quarter ended Sept. 30, 2007, compared
with a net loss of $6.7 million for the third quarter ended
Sept. 30, 2006. The third quarter 2006 results included gains
from property sales of approximately $3.4 million and defeasance
and other prepayment costs of $7.5 million.
Funds from operations were $5.0 million for the quarter, compared
with negative FFO of $3.1 million for the third quarter ended
Sept. 30, 2006. FFO adjusted for defeasance and other prepayment
costs for the third quarter 2006 was $4.3 million.
"The 11.5% improvement in FFO as adjusted is a direct result of
the initiatives we have undertaken to improve the operating
performance of our portfolio, lower our interest costs, sell lower
margin assets and buy properties in faster growing markets," said
Jeffrey I. Friedman, chairman, president and chief executive
officer.
Total revenue for the quarter was $39.4 million compared with
$35.2 million for the third quarter of 2006, an increase of 11.9%.
Same Community Portfolio Results
Revenues for the quarter from the company's same community
portfolio were up 3.9%, and total property operating expenses for
the same community portfolio increased 8.1%, resulting in a 0.5%
in net operating income, compared with the third quarter of 2006.
Physical occupancy was 95.7% at the end of the third quarter of
2007 compared with 95.8% at the end of the third quarter of 2006.
For the third quarter, the average net collected rent per unit for
the same community properties increased 3.5% to $817 per month,
compared with the third quarter of 2006. Net collected rent per
unit for the company's same community Midwest portfolio grew 4.1%,
while net collected rent per unit for the company's same community
properties in the Mid-Atlantic/Southeast markets grew 2.0%.
$100 Million Revolver
In April 2007, the company obtained a $100.0 million revolving
credit facility to be used for the refinancing of existing debt,
general corporate purposes, or the acquisition of properties. In
connection with the revolver, the company terminated its
$17.0 million and $14.0 million secured lines of credit. At
Sept. 30, 2007, there were borrowings of $25.0 million
outstanding on the revolver.
Balance Sheet
At Sept. 30, 2007, the company's consolidated balance sheet showed
$706.1 million in total assets, $605.2 million in total
liabilities, $1.8 million in operating partnership minority
interest, and $99.1 million in total shareholders' equity.
Full-text copies of the company's consolidated financial
statements for the quarter ended Sept. 30, 2007, are available for
free at http://researcharchives.com/t/s?272d
About Associated Estates
Based in Richmond Heights, Ohio, Associated Estates Realty
Corporation (NYSE: AEC) -- http://www.aecrealty.com/-- is a real
estate investment trust and is a member of the Russell 2000 Index.
The company directly or indirectly owns, manages or is a joint
venture partner in 98 properties containing a total of 19,909
units located in 10 states.
* * *
Moody's Investor Service placed Associated Estates Realty
Corporation's long term foreign and local issuer credit rating at
'B+' on July 2007. The rating still holds to date with a stable
outlook.
ATLAS ENERGY: Reports $250 Million Sale of Senior Unsec. Notes
--------------------------------------------------------------
Atlas Energy Resources LLC disclosed the sale of $250 million of
senior unsecured notes due in 2018 in a private placement at a
coupon rate of 10.75%.
By using the proceeds of the note offering to reduce the balance
outstanding on its senior secured credit facility, Atlas Energy
will benefit from a reduction of 75 basis points in the interest
rate on the remaining $500 million outstanding on that credit
facility, and will increase the long term availability of funds on
the facility by approximately $174 million.
Additionally, the company has entered into an interest rate swap
contract for $150 million. Atlas Energy will swap the floating
rate incurred on a portion of its existing senior secured credit
facility for a fixed rate of approximately 4.36%, which includes
an initial margin of 1.25% over the three year fixed swap rate of
3.11%.
The interest rate swap contract will mature in January 2011.
Combining the 4.36% interest rate on the new swap and the 10.75%
interest rate on the new senior notes, the company will have fixed
$400 million of its outstanding debt at a weighted average
interest rate of approximately 8.35%.
"We are pleased to have succeeded in effectuating this group of
financings and to have surmounted the present adverse conditions
which have largely paralyzed United States debt markets", Edward
E. Cohen, chairman and chief executive officer of Atlas Energy,"
stated.
About Atlas Energy Resources LLC
Based in Moon Township, Pennsylvania, Atlas Energy Resources LLC
(NYSE: ATN) -- http://www.atlasenergyresources.com/-- focuses on
the development and production of natural gas and, to a lesser
extent, oil principally in the eastern United States. Atlas
Energy sponsors and manages tax advantaged investment
partnerships, in which it co-invests, to finance the exploration
and development of its acreage in the Appalachian Basin and drills
on its own account in the Antrim Shale of Michigan.
* * *
As reported in the Troubled Company Reporter on Jan. 9, 2008,
Standard & Poor's Ratings Services assigned its 'B+' corporate
credit rating to Atlas Energy Resources LLC. The outlook is
stable. At the same time, Standard & Poor's assigned a 'B'
rating to the proposed $400 million senior unsecured notes to be
co-issued by Atlas Energy's subsidiaries, Atlas Energy Operating
Company LLC and Atlas Energy Finance Corp.
BANCO INDUSTRIAL: Moody's Holds Ba3 Rating on Currency Deposits
---------------------------------------------------------------
Moody's Investors Service affirmed the ratings of Banco Industrial
S.A. following the acquisition of Banpais, Honduras' fifth largest
bank, by Bicapital, its parent holding company. The outlook for
the bank financial strength rating was changed to negative.
At the same time, the agency affirmed the stable outlook for the
bank's Baa3 and Prime-3 long and short term global local currency
deposit ratings, which include systemic support considerations for
its local currency obligations. The positive outlook for the Ba3
and Not Prime long and short term foreign currency deposit ratings
was also affirmed, as they remain constrained by the country
ceiling for deposits, which also have a positive outlook.
On Dec. 19, 2007, Grupo Corporacion BI acquired a 90% stake and
controlling interest in Grupo Financiero Banpais, through
Bicapital, the group's Panama-based parent holding company, and
88% owner of Banco Industrial. The Honduran group's main assets
are Banco del Pais, a universal bank, and insurance company
Seguros del Pais. Moody's does not currently rate Banpais.
The rating agency noted that the Banpais acquisition is
Corporacion BI's fourth in the past two years and is a sizable
one, as it is equal to about 18% of the acquiring group's assets.
The Banpais transaction is the group's first major cross border
acquisition and, as such, it may expose the group to increasing
credit and market risk within a less creditworthy and more highly
dollarized country. Moreover, Moody's said, the acquisition
challenges management's cross border expertise.
Moody's noted at the same time that Industrial's financial
performance benefits from its position as the dominant Guatemalan
banking group in terms of loan and deposit market shares, a
growing and increasingly core deposit base, and strong
distribution capabilities. However, the bank is facing intense
competition from a host of international banks that have entered
the region aggressively in recent years. The transaction is
designed as a defensive move to counteract that encroachment as
well as to provide diversification and earnings enhancement
opportunities for the group, said Moody's.
The negative outlook for financial strength however reflects the
aggressive nature of the financing package for the transaction as
well as the group's acquisitive strategy. Though financed through
the holding, the double leverage used to acquire the Honduran
entity raises the question of a potential financial drain on
Industrial's earnings and capital as the main profit and cash flow
generator of the group.
The agency noted that the ratings affirmation is predicated on the
expectation that the double leverage at the holding company will
be eliminated within the next six months through the group's
planned IPO or by other means. It also assumes that the bank's
tier one adjusted capital ratio will be maintained at historical
levels aided by its enhanced profit potential, shareholder
infusions, and a limited upstreaming of dividends to the holding.
Should the group's double leverage not be eliminated on schedule,
however, a negative rating action is likely, said the agency.
Banco Industrial S.A. was the largest bank in Guatemala as of June
30, 2007 with consolidated assets of approximately
$4.5 billion and equity of $373.3 million. As of Sept. 30, 2007,
Banpais had $925 million in assets, $600 million in deposits, and
earnings of approximately $22 million.
These ratings were affirmed for Banco Industrial S.A.:
-- Bank Financial Strength Rating: D, outlook changed to
negative from stable
-- Long Term Global Local Currency Deposits: Baa3, with
stable outlook
-- Short Term Global Local Currency Deposits: Prime-3
-- Long Term Foreign Currency Deposits: Ba3, with positive
outlook
-- Short Term Foreign Currency Deposits: Not Prime
BANK OF NEW YORK: Moody's Keeps B+ Financial Strength Rating
------------------------------------------------------------
Moody's Investors Service affirmed the Aaa deposit and B+
financial strength ratings of The Bank of New York. The rating
agency also affirmed Aa2 senior debt ratings of the parent
company. Moody's comment follows BK's announcement of a CDO
write-down and a charge associated with consolidation of its asset
backed commercial paper conduit. These charges, while sizable,
lowered fourth quarter earnings by roughly 19% as compared with
the prior quarter's results.
In Moody's view, the fourth quarter charges were quite manageable,
largely offset by robust performance in BK's core businesses.
Moreover, depositors and other creditors remain well protected
given BK's impressive franchise in securities servicing and asset
management. BK has the leading worldwide position in securities
servicer, added the rating agency.
The Bank of New York Mellon Corporation, headquartered in New
York, New York, reported $198 billion in total assets as of year-
end 2007.
BAYVIEW FINANCIAL: Fitch Cuts Rating on Class B-3 Certs. to BB
--------------------------------------------------------------
Fitch Ratings took rating actions on these Bayview Financial
mortgage pass-through certificates:
Series 2005-B
-- Class 1-A2 to 1-A4, 1-A6, 2-A2, & 2-A3 affirmed at 'AAA';
-- Class 1-A5 affirmed at 'AAA' and removed from Rating Watch
Negative;
-- Class M-1 affirmed at 'AA';
-- Class M-2 affirmed at 'AA-';
-- Class M-3 affirmed at 'A';
-- Class M-4 affirmed at 'A-';
-- Class B-1 affirmed at 'BBB';
-- Class B-2 affirmed at 'BBB'.
Series 2005-C
-- Class A-1C, A-2, & A-IO affirmed at 'AAA';
-- Class M-1 affirmed at 'AA';
-- Class M-2 affirmed at 'AA-';
-- Class M-3 affirmed at 'A';
-- Class M-4 affirmed at 'A-';
-- Class B-1 affirmed at 'BBB+';
-- Class B-2 affirmed at 'BBB';
-- Class B-3 is rated 'BBB-' and placed on Rating Watch
Negative.
Series 2005-D
-- Class AF-1 to AF-4, A-PO, & A-IO affirmed at 'AAA';
-- Class 1-A5 affirmed at 'AAA' and removed from Rating Watch
Negative;
-- Class M-1 affirmed at 'AA+';
-- Class M-2 affirmed at 'AA';
-- Class M-3 affirmed at 'AA-';
-- Class M-4 affirmed at 'A+';
-- Class M-5 affirmed at 'A';
-- Class M-6 affirmed at 'A-';
-- Class B-1 affirmed at 'BBB+';
-- Class B-2 is rated 'BBB' and placed on Rating Watch
Negative;
-- Class B-3 is downgraded to 'BB' from 'BBB-' and placed on
Rating Watch Negative.
The affirmations, affecting approximately $420.4 million of the
outstanding certificates, reflect a stable relationship between
credit enhancement and expected loss. The downgrades, affecting
approximately $2.4 million of the outstanding certificates, are
taken as a result of deterioration in the relationship between
credit enhancement and future expected losses. The Rating Watch
Negative status affects approximately $7.8 million of the
outstanding certificates.
The negative rating actions on series 2005-D are the result of
losses exceeding excess spread for the past 12 months and, as a
result, eroding the overcollateralization below target. As of the
December 2007 remittance date, the OC is $2.8 million below the
target of $4.9 million. The OC as a percent of the current
balance is 1.48% ($2 million). The delinquency rate as a
percentage of the current pool balance is 10.41%.
All of the mortgage loans in the aforementioned transactions were
either originated or acquired by Bayview Financial Trading Group,
L.P. The mortgage loans consist of fixed- and adjustable-rate,
fully amortizing and balloon loans secured by senior liens on
residential, commercial, multifamily and mixed use properties.
The mortgage loans are generally believed to have been originated
in accordance with underwriting guidelines that are less strict
than Fannie Mae and Freddie Mac guidelines. As a result, the
mortgage loans are likely to experience higher rates of
delinquency, foreclosure and bankruptcy than mortgage loans
underwritten in accordance with higher standards.
Wells Fargo Bank, N.A. (rated 'RMS1' by Fitch), is the master
servicer for the above transactions. M&T Mortgage Corp (rated
'RPS2' by Fitch) and Bayview Loan Servicing, LLC (rated 'RSS2' by
Fitch) currently service all of the mortgage loans.
CE for all of the transactions detailed above consists of
subordination, growing overcollateralization resulting from the
use of accelerated principal payment amounts derived from interest
on the mortgage loans, and a Reserve Fund financed by excess
interest.
The pool factors of the above transactions range from 40% (series
2005-C) to 59% (series 2005-D). The seasoning ranges from 24
months (series 2005-D) to 31 months (series 2005-B). The
cumulative losses range from 0.69% (series 2005-C) to 1.97%
(series 2005-D).
BENCHMARK ELECTRONICS: Moody's Retains Ba3 Corp. Family Rating
--------------------------------------------------------------
Moody's Investors Service assigned a Ba2 (LGD-3, 39%) rating to
Benchmark Electronics, Inc.'s new 5-year $100 million senior
secured revolving credit facility due 2012 and affirmed the
company's Ba3 corporate family rating. The rating outlook is
stable. Proceeds from the new credit facility are intended to be
used for working capital needs and general corporate purposes. It
replaces an unrated $100 million revolver that was set to expire
in January 2008. The new credit facility includes an accordion
feature under which total commitments may be increased by an
additional $100 million.
The rating for the $100 million senior secured revolver reflects
the overall probability of default of the company, to which
Moody's assigns a PDR of Ba3. Under Moody's Loss Given Default
methodology, the new senior secured credit facilities are rated
one notch above the Ba3 CFR given that they receive sufficient
support from the company's senior unsecured non-debt obligations,
which provide debt cushion for any drawings under the secured bank
credit facility.
The credit facility is guaranteed by the borrower's domestic
subsidiaries, and is secured by:
(1) substantially all assets of the borrower, subsidiary
guarantors and the holding company;
(2) 100% of the capital stock of the borrower and domestic
subsidiaries; and
(3) 65% of the voting capital stock of foreign subsidiaries.
The facility contains financial covenants requiring the
maintenance of certain financial ratios (i.e., financial leverage
equal to or less than 2.75x debt to EBITDA, 1.2x minimum fixed
charge coverage and minimum consolidated tangible net worth).
These new ratings were assigned:
-- Probability of Default Rating: Ba3
-- $100 Million Senior Secured Revolving Credit Facility
due 2012: Ba2 (LGD-3, 39%)
These rating was affirmed:
-- Corporate Family Rating: Ba3
Benchmark's Ba3 CFR reflects the company's minimal leverage and
niche position as a Tier 1 electronics manufacturing services
provider of products in the non-consumer computing,
telecommunications and medical devices markets. While Benchmark
has historically generated operating margins in the upper range
for the industry (4-5% range), the company experienced margin
erosion in the third quarter of 2007 due to a decrease in activity
for its largest customer, slower program ramps and softer end-
market demand. The weakness in the most recent quarter
illustrates the volatility inherent within the EMS industry,
exacerbated by client concentration and heightened competition
from industry consolidation (i.e., Flextronics' acquisition of
Solectron). Furthermore, Moody's expects the company to continue
to face pricing pressures from OEM customers as well as from Asian
competitors.
Moody's rating outlook for Benchmark is stable, reflecting the
expectation that:
(1) revenue levels will bounce back in the near term once new
programs begin to ramp up;
(2) bookings levels will remain healthy, which was the case during
the third quarter of 2007 with approximately $100-$125 million of
new bookings; and
(3) Benchmark should continue to be free cash flow positive in
2008.
The stable outlook also reflects Moody's view that it does not
expect Benchmark's credit profile to change significantly over the
intermediate term.
Benchmark Electronics, Inc., headquartered in Angleton, Texas
provides electronic manufacturing services to original equipment
manufacturers of telecommunication equipment, computers and
related products for business enterprises,
video/audio/entertainment products, industrial control equipment,
testing and instrumentation products and medical devices. The
company's revenue and EBITDA for the twelve months ended Sept. 30,
2007 were $2.9 billion and $168 million, respectively.
BEVERLY HILLS: Voluntary Chapter 11 Case Summary
------------------------------------------------
Debtor: Beverly Hills Suites LLC
15 Carriage Road
Great Neck, NY 11021
Bankruptcy Case No.: 08-70217
Chapter 11 Petition Date: January 16, 2008
Court: Eastern District of New York (Central Islip)
Judge: Dorothy Eisenberg
Debtor's Counsel: James O. Guy, Esq.
1-A New Highway
Commack, NY 11725
Tel: (631) 983-4564
Fax: (631) 983-4565
Estimated Assets: $1 Million to $10 Million
Estimated Debts: $1 Million to $10 Million
The Debtor does not have any creditors who are not insiders.
CABELA CREDIT: S&P Puts BB Preliminary Rating on Class D Notes
--------------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary
ratings to Cabela's Credit Card Master Note Trust's
$500 million asset-backed notes series 2008-I.
The preliminary ratings are based on information as of Jan. 17,
2007. Subsequent information may result in the assignment of
final ratings that differ from the preliminary ratings.
The preliminary ratings reflect:
-- The 13.5% credit enhancement for the class A notes;
-- The 6.5% credit enhancement for the class B notes;
-- The 2.25% credit enhancement for the class C notes;
-- A spread account benefiting the class C and D notes funded
by excess cash flow if the quarterly excess spread
percentage is equal to or less than 4.5%;
-- The portfolio's strong historical performance;
-- Structural features, including amortization events, that
trigger the accelerated paydown of the notes and shorten
investors' exposure to losses; and
-- The transaction's sound legal structure.
Preliminary Ratings Assigned
Cabela's Credit Card Master Note Trust
Class Preliminary rating Preliminary amount (mil.)
----- ------------------ -------------------------
A-1 AAA $202.65
A-2 AAA $229.85
B-1 A+ $29.00
B-2 A+ $6.00
C-1 NR $0.00
C-2 BBB $21.25
D BB $11.25
NR - Not rated.
CARGO CONNECTION: Unit's Lease Termination Eliminates $1 Mil. Debt
------------------------------------------------------------------
Cargo Connection Logistics - International Inc., Cargo Connection
Logistics Holding Inc.'s subsidiary, has terminated its lease in
Chicago with Underwing International for its 92,000 sq. ft.
Chicago facility and leased the facility directly from the owner.
As a result, the company has eliminated more than $1 million in
current liabilities.
Cargo Connection guaranteed the obligations of Cargo Connection
Logistics - International under the new lease, and certain
additional credit enhancement was provided.
"As part of our continuing efforts to improve the company's
financial condition and position, we have negotiated a favorable
agreement with all parties involved in the old lease," Cargo
Connection Logistics Holding Inc. CEO, Jesse Dobrinsky, said. "In
connection with Cargo Connection Logistics - International
agreeing to a new ten-year lease, the landlord has forgiven more
than $1 million in liabilities. This new lease allows the company
to continue to operate in its current facility without disruption,
while also allowing us to unwind a previous related party
transaction with Underwing International LLC."
"The management of MP Cargo has witnessed firsthand the positive
developments in our Chicago hub, which has become an increasingly
valuable part of our business," Mr. Dobrinsky said. "In the last
year alone, we have entered into agreements relating to our
Chicago facility with Rexam Beverage Can Company, a subsidiary of
Rexam PLC, to provide just-in-time inventory and warehouse
services, and also with AIT Worldwide Logistics to assist with hub
operations for its domestic ground network."
London-based Rexam PLC is a consumer packing group and a
manufacturer of beverage cans. AIT Worldwide Logistics is a
freight forwarder in the United States.
Cargo also disclosed it had converted an $800,000 short-term
obligation with Emplify HR Services Inc. into a four-year secured
promissory note, which is guaranteed by certain of the company's
subsidiaries. The company said this move will both enhance its
balance sheet and free up additional working capital.
About Cargo Connection
Cargo Connection Logistics Holding Inc., formerly Championlyte
Holdings Inc. (OTC BB: CRGO.OB) -- http://www.cargocon.com/--
provides logistics solutions for partners through its network of
branch locations and independent agents in North America. Its
target base ranges from mid-sized to Fortune 100TM companies. The
company operates through its network of terminals and
transportation services and predominately as a non-asset based
transportation provider of truckload and less-than-truckload
transportation services. The company also provides logistics
services, which include U.S. Customs Bonded warehouse facilities,
container freight station operations, and a General Order
warehouse operation, which the company began to operate in the
latter part of the second quarter of 2006.
Going Concern Doubt
As reported in the Troubled Company Reporter on Sept. 10, 2007,
Friedman LLP in East Hanover, New Jersey, reported several
conditions that raise substantial doubt about the ability of
the company to continue as a going concern after auditing the
company's financial statements at Dec. 31, 2006. The auditing
firm pointed to the company's losses from operations, negative
cash flows from operating activities, negative working capital
and stockholders' deficit.
CITADEL BROADCASTING: Moody's Keeps Ba3 Corporate Family Rating
---------------------------------------------------------------
Moody's Investors Service affirmed Citadel Broadcasting
Corporation's Ba3 Corporate Family Rating and the Ba3 rating on
its senior secured credit facility. The outlook was revised to
negative from stable reflecting the weakness in the operating
performance, of both the acquired ABC Radio business and the
existing Citadel stations, which has resulted in weaker than
expected credit metrics.
Moody's has taken these ratings actions:
Citadel Broadcasting Corporation
-- Corporate family rating: affirmed Ba3
-- Probability-of-default rating: affirmed Ba3
-- $200 million Senior Secured Revolving Credit Facility:
affirmed Ba3 (LGD 3, 43%)
-- $600 million Senior Secured Tranche A Term Loan: affirmed
Ba3 (LGD 3, 43%)
-- $1.535 billion Senior Secured Tranche B Term Loan:
affirmed Ba3 (LGD 3, 43)
-- Speculative grade liquidity assessment: affirmed SGL 1
The rating outlook has been revised to negative from stable.
Citadel's Ba3 corporate family rating and negative outlook reflect
higher than expected debt to EBITDA leverage (in excess of 7.5x as
of 9/30/2007, based on pro-forma EBITDA for the trailing twelve
months then ended and incorporating Moody's standard adjustments),
continued challenges associated with improving the performance of
the acquired ABC Radio Business, weaker station operating
performance in several markets and therefore weaker credit
metrics. The rating also reflects the inherent cyclicality of the
advertising business, cross media-competition faced by radio for
audience and advertising revenue and Moody's belief that radio is
a mature industry with modest growth prospects.
The rating is supported by Citadel's significant geographic,
format and revenue diversification, strong station clusters and
significant scale. Additionally, the rating reflects Moody's
expectation that management will remain committed to debt
reduction over the rating horizon such that the company's leverage
declines to the low 6x range over the next 18 to 24 months. The
outlook could be revised to stable if Citadel were able to improve
its EBITDA margins and free cash flow such that debt to EBITDA
leverage trends below 6.0x.
Citadel Broadcasting Corporation, headquartered in Las Vegas,
Nevada, is a radio broadcaster comprised of 165 FM and 58 AM
stations in more than 50 markets.
CLASS V FUNDING: Poor Credit Quality Cues Moody's Rating Review
---------------------------------------------------------------
Moody's Investors Service placed these notes issued by Class V
Funding IV on review for possible downgrade:
Class Description: $1,400,000,000 Initial Tranche Notional Amount
Credit Default Swap with Attachment Point 30% and Exhaustion Point
100%
-- Prior Rating: Aaa, on review for possible downgrade
-- Current Rating: Ba3, on review for possible downgrade
According to Moody's, the rating actions are the result of
deterioration in the credit quality of the transaction's
underlying collateral pool, which consists primarily of structured
finance securities.
CLEAR CHANNEL: Extends Key Dates for Senior Notes Tender Offer
--------------------------------------------------------------
Clear Channel Communications Inc. has extended these dates,
in connection with its tender offer for its outstanding
7.65% Senior Notes due 2010 (CUSIP No. 184502AK8), and Clear
Channel's subsidiary AMFM Operating Inc.'s tender offer for its
outstanding 8% Senior Notes due 2008 (CUSIP No. 158916AL0):
-- the date on which the pricing for the Notes will be
established from 2:00 p.m. New York City time on Jan. 14,
2008, to 2:00 p.m. New York City time on Feb. 15, 2008;
-- the date on which the tender offers are scheduled to
expire from 8:00 a.m. New York City time on Jan. 16,
2008, to 8:00 a.m. New York City time on Feb. 20, 2008;
and
-- the consent payment deadline for the Notes from 8:00 a.m.
New York City time on Jan. 16, 2008, to 8:00 a.m. New
York City time on Feb. 20, 2008.
Each of the price determination date, the offer expiration date
and the consent payment deadline is subject to extension by Clear
Channel, with respect to the CCU Notes, and AMFM, with respect to
the AMFM Notes, in their sole discretion.
Clear Channel disclosed on Jan. 2, 2008, that it had received,
pursuant to its tender offer and consent solicitation for the CCU
Notes, the requisite consents to adopt the proposed amendments to
the CCU Notes and the indenture governing the CCU Notes applicable
to the CCU Notes, and that AMFM had received, pursuant to its
tender offer and consent solicitation for the AMFM Notes, the
requisite consents to adopt the proposed amendments to the AMFM
Notes and the indenture governing the AMFM Notes.
The Clear Channel tender offer and consent solicitation were made
pursuant to the terms and conditions set forth in the Clear
Channel Offer to Purchase and Consent Solicitation Statement for
the CCU Notes dated Dec. 17, 2007, and the related Letter of
Transmittal and Consent.
Clear Channel has retained Citi to act as the lead dealer manager
for the tender offers and lead solicitation agent for the consent
solicitations and Deutsche Bank Securities Inc. and Morgan Stanley
& Co. Incorporated to act as co-dealer managers for the tender
offers and co-solicitation agents for the consent solicitations.
Questions regarding the transaction should be directed to Citi at
(800) 558-3745 (toll-free) or (212) 723-6106 (collect).
Global Bondholder Services Corporation is the Information Agent
for the tender offers and the consent solicitations. Requests for
documentation should be directed to Global Bondholder Services
Corporation at (212) 430-3774 (for banks and brokers only) or
(866) 924-2200 (for all others toll-free).
The tender offers and consent solicitations for the Notes are
being made in connection with the merger with BT Triple Crown
Merger Co. Inc. The completion of the merger and the related debt
financings are not subject to, or conditioned upon, the completion
of the tender offers or the related consent solicitations or the
adoption of the proposed amendments with respect to the Notes.
The closing of the merger is expected to occur during the first
quarter 2008 and concurrently with the consummation of the merger,
Clear Channel expects to obtain $18.525 billion of new senior
secured credit facilities, to be available to Clear Channel and
certain of its subsidiaries as borrowers, and to issue $2.6
billion of new senior unsecured notes.
Clear Channel and one or more of its subsidiaries would also be
the borrowers under a separate receivables-backed revolving credit
facility with availability of up to $1 billion. The closing of
the merger is subject to the receipt of regulatory approvals and
conditions.
About Clear Channel Communications
Based in San Antonio, Texas, Clear Channel Communications Inc.
(NYSE:CCU) -- http://www.clearchannel.com/-- is a media
and entertainment company specializing in "gone from home"
entertainment and information services for local communities and
premiere opportunities for advertisers. The company's
businesses include radio, television and outdoor displays. Outside
U.S., the company operates in 11 countries -- Norway,
Denmark, the United Kingdom, Singapore, China, the Czech
Republic, Switzerland, the Netherlands, Australia, Mexico and
New Zealand.
* * *
As reported in the Troubled Company Reporter on Dec. 20, 2007,
Moody's Investors Service stated that it will likely downgrade
Clear Channel Communications Inc.'s Corporate Family Rating to B2
when its change of control is completed. On Dec. 17, 2007, Clear
Channel disclosed a tender offer and consent solicitation for its
outstanding 7.65% senior notes due 2010 and its subsidiary, AMFM
Operating Inc. announced a tender offer and consent solicitation
for its 8% senior notes due 2008.
COASTAL BAGELS: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: Coastal Bagels, Inc.
aka Brueggers Bagels
3800 Washington Road, Suite 1207
West Palm Beach, FL 33405
Bankruptcy Case No.: 08-10568
Type of Business: The Debtor, a franchisee of Bruegger's
Enterprises, operates a Bruegger's bakery-cafe.
See http://www.brueggers.com
Chapter 11 Petition Date: January 17, 2008
Court: Southern District of Florida (West Palm Beach)
Judge: Paul G. Hyman, Jr.
Debtor's Counsel: Brian S. Behar, Esq.
Behar, Gutt & Glazer, P.A.
2999 Northeast 191 Street, 5th Floor
Aventura, FL 33180
Tel: (305) 931-3771
Estimated Assets: $1 Million to $10 Million
Estimated Debts: $1 Million to $10 Million
The Debtor did not file a list of its largest unsecured creditors.
CONGOLEUM CORP: Files Amended Chapter 11 Plan of Reorganization
---------------------------------------------------------------
Congoleum Corporation filed its amended Chapter 11 reorganization
plan was filed by the future claimants' representative in its
Chapter 11 proceedings.
The Debtor believes the plan will receive the support of the
Official Bondholders' Committee and the Official Asbestos
Claimants' Committee. A hearing to consider the adequacy of the
disclosure statement describing the plan is scheduled for
Feb. 14, 2008.
If the plan is approved by the court and accepted by the requisite
creditor constituencies, it will permit Congoleum to exit Chapter
11 free of liability for existing or future asbestos claims.
Under the terms of the amended plan, a trust will be created that
assumes the liability for Congoleum's current and future asbestos
claims. That trust will receive the proceeds of various
settlements Congoleum has reached with a number of insurance
carriers, and will be assigned Congoleum's rights under its
remaining policies covering asbestos product liability. The trust
will also receive 50.1% of the newly issued common stock in
reorganized Congoleum when the plan takes effect.
Holders of Congoleum's $100 million in 8.625% senior notes due in
August 2008 will receive on a pro rata basis $80 million in new
9.75% senior secured notes that mature five years from issuance.
The new senior secured notes will be subordinated to the working
capital facility that provides Congoleum's financing upon exiting
reorganization. In addition, holders of the $100 million in
8.625% senior notes due in August 2008 will receive 49.9% of the
common stock in reorganized Congoleum. Congoleum's obligations
for the $100 million in 8.625% senior notes due in August 2008,
including accrued interest -- which amounted to $44.6 million at
Dec. 31, 2007 -- will be satisfied by the new senior secured notes
and the common stock issued when the plan takes effect.
Under the terms of the amended plan, existing Class A and Class B
common shares of Congoleum will be cancelled when the plan takes
effect and holders of those shares, including the current
controlling shareholder American Biltrite will not receive
anything on account of their cancelled shares. Congoleum expects
existing management will continue post-reorganization.
Roger S. Marcus, Chairman of the Board, commented, "We are pleased
that an agreement has been reached that provides a global
settlement and should hopefully permit Congoleum to exit
bankruptcy in 2008. While I am disappointed that the current plan
does not provide the recoveries for bondholders and shareholders
that we had sought in earlier plans, it reflects the economic
reality of what can be done and the hierarchy of recoveries under
the bankruptcy code. The reorganization, with all its attendant
litigation, has been tremendously expensive, and we look forward
to Congoleum emerging from bankruptcy a healthy entity with
adequate resources to provide for its continued viability for its
employees and customers. We believe this will be accomplished by
the plan."
Mr. Marcus continued, "I thank our employees, customers, and
suppliers for their continued support throughout this process, and
look forward to our continuing relationship as Congoleum emerges
from bankruptcy. I am committed to our collective success, and
excited about the future potential of Congoleum without the
distractions we've faced over the last five years. I plan both to
see this company through its bankruptcy and to be a part of its
future growth thereafter."
About Congoleum Corp.
Based in Mercerville, New Jersey, Congoleum Corporation (AMEX:CGM)
-- http://www.congoleum.com/-- manufactures and sells resilient
sheet and tile floor covering products with a wide variety of
product features, designs and colors. The company filed for
chapter 11 protection on Dec. 31, 2003 (Bankr. N.J. Case No.
03-51524) as a means to resolve claims asserted against it related
to the use of asbestos in its products decades ago.
Richard L. Epling, Esq., Robin L. Spear, Esq., and Kerry A.
Brennan, Esq., at Pillsbury Winthrop Shaw Pittman LLP, and Paul S.
Hollander, Esq., and James L. DeLuca, Esq., at Okin, Hollander &
DeLuca, LLP, represent the Debtors. At March 31 2007, Congoleum
reported $180,091,000 in total assets and $226,990,000 in total
liabilities, resulting in a stockholders' deficit $46,899,000.
The Asbestos Claimants' Committee is represented by Peter Van N.
Lockwood, Esq., and Ronald Reinsel, Esq., at Caplin & Drydale,
Chtd. The Bondholders' Committee is represented by Michael S.
Stamer, Esq., and james R. Savin, Esq., at Akin Gump Strauss Hauer
& Feld LLP. Nancy Isaacson, Esq., at Goldstein Isaacson, PC,
represents the Official Committee of Unsecured Creditors.
R. Scott Williams, Esq., of Haskell Slaughter Young & Rediker,
LLC, the Court-appointed Futures Claimants Representative, is
represented by Roger Frankel, Esq., Richard Wyron, Esq., and
Jonathan P. Guy, Esq., at Orrick Herrington & Sutcliffe LLP, and
Stephen B. Ravin, Esq., at Forman Holt Eliades & Ravin LLC.
American Biltrite, Inc. (AMEX: ABL), which owns 55% of Congoleum,
is represented by Matthew Ward, Esq., Mark S. Chehi, Esq.,
Christopher S. Chow, Esq., and Matthew P. Ward, Esq., at Skadden
Arps Slate Meagher & Flom.
COUNTRYWIDE ALT-A: Fitch Junks Ratings on 22 Transactions
---------------------------------------------------------
Fitch Ratings has taken rating actions on these Countrywide Alt-A
transactions:
CWALT 2005-46CB
-- Class A affirmed at 'AAA';
-- Class M affirmed at 'AA';
-- Class B-1 rated 'A', placed on Rating Watch Negative;
-- Class B-2 downgraded to 'BB+' from 'BBB';
-- Class B-3 downgraded to 'B' from 'BB';
-- Class B-4 downgraded to 'C/DR5' from 'B'.
CWALT 2006-HY13 Group 1
-- Class A affirmed at 'AAA';
-- Class I-M affirmed at 'AA';
-- Class I-B-1 downgraded to 'BBB+' from 'A';
-- Class I-B-2 downgraded to 'BB' from 'BBB';
-- Class I-B-3 downgraded to 'C/DR3' from 'BB';
-- Class I-B-4 downgraded to 'C/DR5' from 'B'.
CWALT 2006-HY13 Group 2
-- Class A affirmed at 'AAA';
-- Class II-M affirmed at 'AA';
-- Class II-B-1 rated 'A', placed on Rating Watch Negative;
-- Class II-B-2 downgraded to 'BB' from 'BBB';
-- Class II-B-3 downgraded to 'C/DR4' from 'BB';
-- Class II-B-4 downgraded to 'C/DR5' from 'B'.
CWALT 2007-1T1
-- Class A affirmed at 'AAA';
-- Class M-A affirmed at 'AA+';
-- Class M-1 downgraded to 'AA' from 'AA+';
-- Class M-2 downgraded to 'AA-' from 'AA';
-- Class M-3 downgraded to 'A' from 'AA-';
-- Class M-4 downgraded to BBB+' from 'A+';
-- Class M-5 downgraded to 'BB+' from 'A-';
-- Class B-1 downgraded to 'BB-' from 'BBB+';
-- Class B-2 downgraded to 'C/DR4' from 'BBB';
-- Class B-3 downgraded to 'C/DR4' from 'BB';
-- Class B-4 downgraded to 'C/DR5' from 'B'.
CWALT 2007-3T1
-- Class A affirmed at 'AAA';
-- Class M downgraded to 'A+' from 'AA';
-- Class B-1 downgraded to 'BBB-' from 'A';
-- Class B-2 downgraded to 'B' from 'BBB';
-- Class B-3 downgraded to 'C/DR4' from 'BB';
-- Class B-4 downgraded to 'C/DR5' from 'B'.
CWALT 2007-4CB
-- Class A affirmed at 'AAA';
-- Class M downgraded to 'AA-' from 'AA';
-- Class B-1 downgraded to 'BBB' from 'A';
-- Class B-2 downgraded to 'B' from 'BBB';
-- Class B-3 downgraded to 'C/DR4' from 'BB';
-- Class B-4 downgraded to 'C/DR5' from 'B'.
CWALT 2007-6
-- Class A affirmed at 'AAA';
-- Class M-A affirmed at 'AA+';
-- Class M downgraded to 'AA-' from 'AA';
-- Class B-1 downgraded to 'BBB+' from 'A';
-- Class B-2 downgraded to 'BB' from 'BBB';
-- Class B-3 downgraded to 'C/DR4' from 'BB';
-- Class B-4 downgraded to 'C/DR5' from 'B'.
CWALT 2007-12T1
-- Class A affirmed at 'AAA';
-- Class M-1 affirmed at 'AA';
-- Class M-2 downgraded to 'AA-' from 'AA';
-- Class M-3 downgraded to 'BBB+' from 'A+';
-- Class M-4 downgraded to 'BBB' from 'A';
-- Class M-5 downgraded to 'BBB-' from 'BBB+';
-- Class B-1 downgraded to BB+' from 'BBB+';
-- Class B-2 downgraded to 'BB-' from 'BBB';
-- Class B-3 downgraded to 'C/DR4' from 'BB';
-- Class B-4 downgraded to 'C/DR5' from 'B'.
CWALT 2007-14T2
-- Class A affirmed at 'AAA';
-- Class M downgraded to 'AA-' from 'AA';
-- Class B-1 downgraded to 'BBB+' from 'A';
-- Class B-2 downgraded to 'BB' from 'BBB';
-- Class B-3 downgraded to 'C/DR4' from 'BB';
-- Class B-4 downgraded to 'C/DR5' from 'B'.
CWALT 2007-J1 Group 1
-- Class A affirmed at 'AAA';
-- Class M downgraded to 'A+' from 'AA';
-- Class B-1 downgraded to 'BBB-' from 'A';
-- Class B-2 downgraded to 'B' from 'BBB';
-- Class B-3 downgraded to 'C/DR4' from 'BB';
-- Class B-4 downgraded to 'C/DR5' from 'B'.
CWALT 2007-J2
-- Class A rated 'AAA', placed on Rating Watch Negative;
-- Class M downgraded to 'A+' from 'AA';
-- Class B-1 downgraded to 'BBB-' from 'A';
-- Class B-2 downgraded to 'B' from 'BBB';
-- Class B-3 downgraded to 'C/DR4' from 'BB';
-- Class B-4 downgraded to 'C/DR5' from 'B'.
The affirmations, affecting approximately $5.1 billion of
outstanding certificates, reflect a stable relationship between
credit enhancement and future loss expectations. The downgrades,
affecting approximately $238.1 million in outstanding
certificates, and classes placed on Rating Watch Negative,
affecting approximately $253.9 million of outstanding
certificates, reflect deterioration in the relationship between CE
and loss expectation.
The collateral of the above transactions primarily consists of 30-
and 15-year fixed-rate mortgage loans extended to Alt-A borrowers
and are secured by first liens, primarily on one- to four-family
residential properties. As of the December 2007 distribution
date, the above transactions are seasoned from 7 (series 2007-14T2
Group 3) to 28 (series 2005-46CB) months. The pool factors range
from 77% (series 2005-46CB) to 96% (series 2007-J2). Countrywide
Home Loans Servicing, LP (rated 'RMS2+' by Fitch) is the master
servicer on all of the transactions.
DANIEL MCELHERAN: Case Summary & Ten Largest Unsecured Creditors
----------------------------------------------------------------
Debtors: Daniel D. McElheran
Nita Katrati
3037 Northwest 63 Street
Boca Raton, FL 33496
Bankruptcy Case No.: 08-10494
Chapter 11 Petition Date: January 16, 2008
Court: Southern District of Florida (West Palm Beach)
Judge: Paul G. Hyman Jr.
Debtors' Counsel: Robert C. Furr, Esq.
Furr and Cohen, P.A.
2255 Glades Road, Suite 337W
Boca Raton, FL 33431
Tel: (561) 395-0500
Fax: (561) 338-7532
Total Assets: $5,874,599
Total Debts: $5,127,951
Debtors' list of its Ten Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
U.S. Bank National Association 255 Northeast 3 $445,564
c/o America Servicing Co Avenue, Unit 2204, ($395,000
3476 Stateview Boulevard Delray Beach, FL secured)
Fort Mill, SC 29715 Pineapple Grove
Village Condominium
Unit 2-204, OR Book
19670, Pg 1246,
Public Records Palm
Beach, County
U.S. Bank National Association 250 Northeast 3 $445,188
c/o David Stern, Esq. Avenue, Unit 1318, ($395,000
801 South University Drive #500 Delray Beach, FL secured)
Fort Lauderdale, FL 33324 Pineapple Grove
Village Condominium
Unit 1-318, OR Book
19670, Pg 1246,
Public Records Palm
Beach, County
Washington Mutual 5055 Wiles Road $202,340
P.O. Box 78148 Suite 102, Coconut ($195,000
Phoenix, AZ 85062-8148 Creek, FL Unit 102, secured)
Building 12, Evergreen
Lakes, a condominium
according to the
Declaration recorded in
OR Book 40566
5061 Wiles Road $199,302
Suite 306, Coconut
Creek, FL Unit 306
Amtrust Bank fka Ohio Savings 815 Boynton Beach $142,181
Boulevard Unit 8205 ($135,000
Boynton Beach, FL secured)
Casablanca Isles
Condominium Unit 205
Building 8 Purchased:
6/15/05 foreclosure
lawsuit filed 5
Countrywide Home Loans 302 Meadows Cir, $139,120
Boynton Beach (1$125,00
Meadows on the Green secured)
Condominium Unit 302
Building 3, OR Book
18970, Pg 1595, Public
Records Palm Beach
County
Palm Beach County Tax Collector real property taxes $24,682
Broward County Revenue real property taxes $18,718
Bank of America 2005 Chev Equinox $12,964
VIN #2CNDL13F456207 ($10,000
676, subject to lien secured)
of Bank of America
Casablanca Isles Condo 815 Boynton Beach $2,960
Association Boulevard Unit 8205 ($135,000
secured)
($142,181
senior lien)
815 Boynton Beach $2,960
Boulevard #8205,
Boynton Beach, FL
33437
Boca Raton Community Hospital medical $3,763
DENVER RADIO: Gets Interim OK to Use Lender's Cash Collateral
-------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Colorado gave Denver
Radio Co. LLC and its debtor-affiliates authority to use the cash
collateral securing repayment of their obligations to Guggenheim
Corporate Funding LLC.
Guggenheim claims a security interest in substantially all of the
Debtors' cash. As of the date of bankruptcy, the principal and
accrued interest on account of the indebtedness owing to
Guggenheim is $24,200,000, excluding fees and expenses. The
Debtor says that events of default with respect to the
indebtedness have occurred.
The Debtors are authorized to use the cash collateral in
accordance with a budget, except that the Debtors may collectively
deviate upwards from the expense items in the budget on a line-
item basis up to 10% on a cumulative basis from week to week.
As adequate protection, the Debtors grant Guggenheim a replacement
lien with the same scope and priority as that of their prepetition
asset liens.
The Court will hold a hearing on Jan. 28, 2008, at 1:30 p.m., to
consider final approval of the matter.
Headquartered in Aurora, Colorado, Denver Radio Co., LLC --
http://www.sassymartini.com/-- owns and manages radio stations.
The company and its affiliates filed for Chapter 11 protection on
Dec. 26, 2007 (Bankr. D. Colo. Lead Case No. 07-25039). Michael
J. Pankow, Esq., at Brownstein Hyatt Schreck, P.C., represents the
Debtors in their restructuring efforts. No Official Committee of
Unsecured Creditors has been appointed in this case to date. The
Debtors' schedules of assets and liabilities reflect total assets
of $48,289,050, and total debts of $24,959,175.
DENVER RADIO: Inks $5,000,000 DIP Financing Pact With Full Circle
------------------------------------------------------------
Denver Radio Co. LLC and its debtor-affiliates ask authority from
the U.S. Bankruptcy Court for the District of Colorado to obtain
debtor-in-possession financing from Full Circle Funding L.P.
Full Circle has agreed to fund the Debtors' post-petition
operations up to $5,000,000 secured by a first priority lien on
all of the Debtors' property, pursuant to a signed term sheet.
Denver Radio, the holding company, relates that it intends to
return to profitability by improving their radio signals in the
Denver metropolitan area and by continuing to build their listener
audiences. The Debtors tells the Court that the proposed loan
provides necessary and sufficient funding for the Debtors to
operate in bankruptcy, make important capital expenditures,
increase the value of their assets, and formulate and implement a
reorganization plan that pays all creditors in full.
Headquartered in Aurora, Colorado, Denver Radio Co., LLC --
http://www.sassymartini.com/-- owns and manages radio stations.
The company and its affiliates filed for Chapter 11 protection on
Dec. 26, 2007 (Bankr. D. Colo. Lead Case No. 07-25039). Michael
J. Pankow, Esq., at Brownstein Hyatt Schreck, P.C., represents the
Debtors in their restructuring efforts. No Official Committee of
Unsecured Creditors has been appointed in this case to date. The
Debtors' schedules of assets and liabilities reflect total assets
of $48,289,050, and total debts of $24,959,175.
DESTINY HOSPICE: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Lead Debtor: Destiny Hospice, Palliative Care,
Specialty Services, Inc.
dba Destiny Hospice, Inc.
202 Second Street
Tutwiler, MS 38963
Tel: (662) 345-0077
Bankruptcy Case No.: 08-10160
Type of Business: The Debtor engages in healthcare services.
Chapter 11 Petition Date: January 15, 2008
Court: Northern District of Mississippi (Aberdeen)
Judge: David W. Houston III
Debtors' Counsel: Paul Mathis, Jr., Esq.
Harmon & Davies, P.C.
365 West Reed Road, Suite C
P.O. Box 936
Greenville, MS 38702-0936
Tel: (662) 332-6660
Fax: (662) 332-6668
http://www.bellsouth.net/
Estimated Assets: $100,000 to $1 million
Estimated Debts: $1 million to $100 million
Consolidated Debtors' List of 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Center of Medicare FY-10/2004 government $4,743,750
Palmetto GBA
34650 U.S. Highway 19 North
Suite 202
Palm Harbor, FL 36484-2156
Department of Treasury government $516,438
Internal Revenue Services
Washington, DC 20224
Covenant Bank bank loan $455,931
P.O. Box 550
Clarksdale, MS 38614
Guaranty Bank & Trust bank loan $300,000
Company
Memphis Grizzlies trade debt $61,416
Avritt Medical Equipment trade debt $19,635
Lemic Inc. insurance $19,335
MS State Tax Commission trade debt $8,763
Techinfo Inc. contract $3,348
BMH North Mississippi trade debt $4,589
Northwest Regional Medical trade debt $4,277
Center
AT&T trade debt $4,260
City of Cleveland trade debt $2,371
First Choice Medical Supply trade debt $2,189
Judy G. Noland trade debt $1,977
Universal Hospital Holmes trade debt $1,437
County
Henderson Drug/Home Health trade debt $1,051
Care Medical trade debt $900
A&A Home Health Equipment trade debt $740
DOMAIN INC: Files for Chapter 11 Protection in Delaware
-------------------------------------------------------
Domain, Inc. dba Domain Home Furnishings has filed a voluntary
petition to reorganize under Chapter 11 of the U.S. Bankruptcy
Code in the U.S. Bankruptcy Court, District of Delaware. Under
Chapter 11, Domain will continue to operate its businesses under
Court protection from creditors, while seeking to develop and
implement a reorganization plan.
With the financial pressures associated with operating the
27-store chain, particularly in today's depressed economic and
real estate environment, Domain has experienced reduced sales and
loss of working capital. After careful consideration and a
thorough review of its options, the Company concluded that the
best way for Domain to address these challenges, while continuing
to serve its customers and operate the business, is to seek the
protection of the Bankruptcy Court via a Chapter 11 filing.
Domain's 27 stores in Massachusetts, Connecticut, New Jersey, New
York, Pennsylvania, Maryland and Virginia, as well as its
Distribution Centers, will remain open during the Chapter 11
proceedings. The Company is also actively seeking ways to fulfill
outstanding customer orders during this process.
Domain's board also voted to refocus its management team during
this reorganization phase to enable its leadership to focus on the
current tasks on hand. Judy George, founder and Chief Executive
Officer of Domain, will drive an aggressive fundraising campaign
to seek investors for the company. Tony Castelli, Domain's VP -
Stores & Operations, will assume day-to-day operations
responsibilities during the reorganization process.
According to Judy George, a 30-year home furnishings innovator,
"Domain has been my lifelong passion and I will fight for our
future. I'm taking every possible measure to protect my customers
and employees, who are like family to me. My main role throughout
our reorganization will be to raise the funds needed to allow
Domain to thrive." Ms. George added, "Our team of great
Associates is deeply committed to serving our customers and
working constructively with our vendors to get our operations back
on track. We hope our company will be here for many years to
come, providing the high style, quality home furnishings our
customers have come to expect from Domain."
Chapter 11 filings allow companies to reorganize in response to
situations such as the current economic pressures and are a proven
process that many `brand name' companies have used to gain
breathing room from some financial pressures while working to
strengthen and revitalize their businesses.
Headquartered in Norwood, Massachusetts, Domain Inc. aka Domain
Home Furnishings -- http://www.domain-home.com/-- operates a
chain of 27 home furnishing stores across seven states in the
Northeast and Mid-Atlantic regions of the US, including suburbs of
major metropolitan markets such as Boston, New York, Philadelphia
and Washington, D.C.
DOMAIN INC: Case Summary & 30 Largest Unsecured Creditors
---------------------------------------------------------
Lead Debtor: Domain, Inc.
dba Domain Home
dba Domain Home Furnishings
dba Domain-Home.com
51 Morgan Drive
Norwood, MA 0202
Bankruptcy Case No.: 08-10132
Debtor-affiliates filing separate Chapter 11 petitions:
Entity Case No.
------ --------
Domain Home Holding Co., L.L.C. 08-10133
Type of Business: The Debtors operate a chain of 27 home
furnishing stores across seven states in the
Northeast and Mid-Atlantic regions of the US,
including suburbs of major metropolitan markets
such as Boston, New York, Philadelphia and
Washington, D.C.
See http://www.domain-home.com/
Chapter 11 Petition Date: January 18, 2008
Court: District of Delaware (Delaware)
Judge: Peter J. Walsh
Debtors' Counsel: J. Kate Stickles, Esq.
Mark Minuti, Esq.
Saul Ewing, L.L.P.
222 Delaware Avenue
P.O. BOX 1266
Wilmington, DE 19899-1266
Tel: (302) 421-6873, (302) 421-6840
Fax: (302) 421-5879, (302) 421-5873
Estimated Assets Estimated Debts
---------------- ---------------
Domain, Inc. $10 Million to $10 Million to
$50 Million $50 Million
Domain Home Holding Co., $10 Million to $10 Million to
L.L.C. $50 Million $50 Million
Debtors' Consolidated List of 30 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Paladin Industries, Inc, trade debt $1,101,146
5270 Highway 90 East
Hiddenite, NC 28636
McCreary Modern trade debt $772,230
2654 Highway 321-South
Newton, North Carolina 28658
Key City Furniture trade debt $456,228
1804 River Street
Wilkesboro, NC 28697
Natuzzi trade debt $339,555
130 West Commerce Avenue
High Point, NC 27260
Artistica Metal Designs trade debt $267,437
3200 Golf Course Drive
Ventura, CA 93003
A.G.A. Heartland trade debt $238,241
Southern Furniture trade debt $194,390
Joe Cory Warehouses, Inc. trade debt $193,117
Nourison trade debt $124,757
Escalate Retail trade debt $111,901
Valspar (Guardsman) trade debt $100,267
Concord Litho trade debt $55,715
Tri-River Design & trade debt $54,236
Construction
Casa Fiora trade debt $47,412
Kingshead trade debt $46,825
Vanguard trade debt $45,564
Providence House trade debt $43,799
New York Times trade debt $40,000
Washington Post trade debt $37,890
Curry & Co. trade debt $37,646
Buying and Design trade debt $36,762
Global Views, Inc. trade debt $31,987
Expeditors International, Inc. trade debt $31,309
On Time Express, Inc. trade debt $28,958
Shaw Rugs trade debt $26,152
Old Dominion Freight Line, trade debt $26,016
Inc.
Eastern Accents trade debt $25,080
Trade A.M. trade debt $25,065
Dessau Home trade debt $23,319
Vellum trade debt $22,944
EL RANCHO: Voluntary Chapter 11 Case Summary
--------------------------------------------
Debtor: EL Rancho De Santa Maria, L.L.C.
1235 Shafter Street
San Diego, CA 92106
Bankruptcy Case No.: 08-00276
Chapter 11 Petition Date: January 16, 2008
Court: Southern District of California (San Diego)
Judge: Louise DeCarl Adler
Debtor's Counsel: Michael Lusby, Esq.
2182 El Camino Real, Suite 205
Oceanside, CA 92054
Tel: (760) 967-5989
Fax: (760) 454-4589
Estimated Assets: $1 Million to $10 Million
Estimated Debts: $1 Million to $10 Million
The Debtor did not file a list of its largest unsecured creditors.
FEDDERS CORP: Court Extends Plan Filing Deadline Until February 29
------------------------------------------------------------------
The United States Bankruptcy Court for the District of Delaware
extended Fedders Corporation and its debtors-affiliates' exclusive
periods to:
a) file a Chapter 11 plan until Feb. 29, 2008; and
b) solicit acceptances of that plan until April 29, 2007.
As reported in the Troubled Company Reporter on Dec. 28, 2007,
the Debtors proposed June 17, 2008, as the last day within which
they can file a plan.
In their request, the Debtors told the Court that they need more
time to complete a proposed asset sale process and develop a
confirmable plan, without prejudicing any party in interest.
Based in Liberty Corner, New Jersey, Fedders Corporation --
http://www.fedders.com/-- manufactures and markets air
treatment products, including air conditioners, air cleaners,
dehumidifiers, and humidifiers.
The company filed for Chapter 11 protection on Aug. 22, 2007,
(Bankr. D. Del. Case No. 07-11182). Its debtor-affiliates
filed for separate Chapter 11 cases. Norman L. Pernick, Esq. of
Saul, Ewing, Remick & Saul LLP represents the Debtors in their
restructuring efforts. The Debtors have selected Logan &
Company Inc. as claims and noticing agent. The U.S. Trustee for
region 3 has appointed an Official Committee of Unsecured
Creditors on this case. When the Debtors filed for protection
from its creditors, it listed total assets of US$186,300,000 and
total debts of US$322,000,000.
The company has production facilities in the United States in
Illinois, North Carolina, New Mexico, and Texas and
international production facilities in the Philippines, China
and India.
FEDDERS CORP: Completes $7.5 Million Sale of Affiliate's Assets
---------------------------------------------------------------
Fedders Corporation has completed the sale of its Fedders
Islandaire Inc. subsidiary's assets to Robert E. Hansen, Jr.,
president of Islandaire.
As reported in the Troubled Company Reporter on Jan. 16, 2008,
the Honorable Brendan L. Shannon of the U.S. Bankruptcy
Court for the District of Delaware approved Fedders Corp. and
its debtor-affiliates' proposed bidding procedure for the sale
of substantially all of Fedders Islandaire Inc.'s assets for
$7.5 million.
The Debtors tell the Court that it entered into an asset purchase
agreement dated Dec. 24, 2007, with Robert E. Hansen, Jr., for the
sale of Fedders Islandaire's assets.
About Fedders Corporation
Based in Liberty Corner, New Jersey, Fedders Corporation --
http://www.fedders.com/-- manufactures and markets air
treatment products, including air conditioners, air cleaners,
dehumidifiers, and humidifiers.
The company filed for Chapter 11 protection on Aug. 22, 2007,
(Bankr. D. Del. Case No. 07-11182). Its debtor-affiliates
filed for separate Chapter 11 cases. Norman L. Pernick, Esq.,
Irving E. Walker, Esq., and Adam H. Isenberg, Esq., of Saul,
Ewing, Remick & Saul LLP represents the Debtors in their
restructuring efforts. The Debtors have selected Logan & Company
Inc. as claims and noticing agent. The U.S. Trustee for Region 3
has appointed an Official Committee of Unsecured Creditors in this
case. When the Debtors filed for protection from its creditors,
it listed total assets of $186,300,000 and total debts of
$322,000,000.
The company has production facilities in the United States
in Illinois, North Carolina, New Mexico, and Texas and
international production facilities in the Philippines, China
and India.
FIRST NLC: Files for Chapter 11 Protection in West Palm, Florida
----------------------------------------------------------------
Friedman, Billings, Ramsey Group Inc. has disclosed that First NLC
Financial Services LLC, FBR Group's mortgage origination
subsidiary, has filed for Chapter 11 protection with the U.S.
Bankruptcy Code for the Southern District of Florida, in order to
effectuate an orderly liquidation of FNLC's assets.
As reported in the Troubled Company Reporter on Jan. 15, 2008, FBR
Group announced that it would not close the previously disclosed
recapitalization and sale of FNLC. FBR Group has taken steps to
limit its ongoing exposure to FNLC. In connection with the
expected Chapter 11 filing, FBR Group said that it does not expect
to recover its remaining $12 million investment in FNLC.
Paul Steven Singerman, Esq., at Berger Singerman P.A., serves as
lead bankruptcy counsel to FNLC. Peter Partee of Hunton & Williams
LLP serves as lead counsel to FBR Group in connection with FNLC's
bankruptcy.
About FBR Inc.
Based in Washington, D.C., Friedman, Billings, Ramsey Group, Inc.
(NYSE: FBR) -- http://www.fbr.com/-- provides investment
banking, merger and acquisition advisory services, institutional
brokerage, research, asset management and private wealth services
through majority ownership of FBR Capital Markets Corporation.
FBR Capital Markets focuses capital and financial expertise on
eight industry sectors: consumer, diversified industrials, energy
& natural resources, financial institutions, healthcare,
insurance, real estate, and technology, media & telecom. FBR
Group also invests in mortgage-related assets and merchant banking
opportunities. The company also has offices in Arlington,
Virginia; Boston; Dallas; Houston; Irvine; New York; San
Francisco; London, England; and Sydney, Australia.
FIRST NLC: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------
Lead Debtor: First N.L.C. Financial Services, L.L.C.
4680 Conference Way South
Boca Raton, FL 33431
dba First N.L.C.
dba The Lending Center
dba Florida Mortgage Network
Bankruptcy Case No.: 08-10632
Debtor-affiliates filing separate Chapter 11 petitions:
Entity Case No.
------ --------
N.L.C., Inc. 08-10634
First N.L.C. 08-10635
Type of Business: The Debtor originated, underwrote, and funded
primarily non-prime residential mortgage loans
to borrowers who don't quite meet underwriting
standards. It originated some 70% of its loans
through a wholesale channel of some 5,300
independent brokers in nearly 40 states. Its
remaining loans were originated through a retail
channel of more than 40 branch offices in 17
states. Its correspondent division bought and
serviced nonprime loans. Most of its borrowers
used their loans for home purchases, while some,
some used theirs to consolidate debt or to
refinance existing loans. See
http://www.firstnlc.com
Chapter 11 Petition Date: January 18, 2008
Court: Southern District of Florida (West Palm Beach
Judge: Paul G. Hyman, Jr.
Debtors' Counsel: Arthur J. Spector, Esq.
Berger Singerman, P.A.
350 East Las Olas Boulevard, Suite 1000
Fort Lauderdale, FL 33301
Tel: (954) 525-9900
Fax: (954) 523-2872
First N.L.C. Financial Services, Inc's Financial Condition:
Estimated Assets: $10 Million to $50 Million
Estimated Debts: $50 Million to $100 Million
A. First N.L.C. Financial Services, Inc's 20 Largest Unsecured
Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Goldman Sachs Mortgage Co. reps & warranties $5,027,241
85 Broad Street, 26th Floor claims
New York, NY 10010
H.S.B.C. Mortgage Services Reps $ Warranties $2,956,743
3023 H.S.B.C. Way claims
Fort Mill, SC 29715
Deutsche Bank Securities, Inc. reps & warranties $2,147,494
60 Wail Street, 3rd Floor
New York, NY 10005-2858
U.S. Bank Corporate Trust reps & warranties $1,021,674
Services claim
60 Livingston Avenue
St. Paul, MN 55107
Aurora Loan Services reps & warranties $949,250
10350 Park Meadows Drive, claim
3rd Floor
Littleton, CO 80124
Countrywide Home Loans, Inc. reps & warranties $669,225
8521 Fallbrook Avenue,
Suite WH-51 M
West Falls, CA 91304
D.L.J. Mortgage Capital, Inc. reps & warranties $548,506
Attention: Credit Suisse First claim
Boston, L.L.C.
Eleven Madison Avenue
New York, NY 10010-3629
Stanfield Settlement settlement obligation $539,038
Brigman, Dave severance benefit $386,250
7581 Doubleton Drive
Delray Beach, FL 33484
Raney, Kelvin severance benefit $250,000
6212 Colina Pacifica
San Clemente, CA 92673
M.C.I. trade debt $244,408
Pathman, James M. severance benefit $240,714
S.N.G.C., L.L.C. reps & warranties $235,788
claims
Parkway Properties trade debt $224,390
Chase Home Finance reps & warranties $210,728
Cosentino, Robert G. severance benefit $204,512
Hawkins, Robert B. severance benefit $184,036
Nelson, Mullins, Riley & trade debt $170,837
Scarborough, L.L.C.
Taylor, Scott severance benefit $165,804
G.M.A.C. ResCap reps & warranties $153,000
claim
B. N.L.C., Inc. does not have any creditors who are not insiders.
C. First N.L.C. does not have any creditors who are not insiders.
FISHER COMMS: Moody's Gives Positive Outlook on Good Operations
---------------------------------------------------------------
Moody's Investors Service changed the outlook for Fisher
Communications, Inc. to positive from stable based on stronger
than anticipated operating performance and an expectation of
further margin expansion and overall improvement in financial
metrics driven by core operations. Over the intermediate term and
absent any use of cash outside of current expectations, sustained
improvement in credit metrics and liquidity could result in an
upgrade of the long term ratings. Concurrent with the outlook
change, Moody's also affirmed the B2 corporate family rating and
all other existing ratings, including the SIGIL-2 speculative
grade liquidity rating.
Fisher's B2 corporate family rating continues to reflect lack of
scale, geographic concentration and industry concerns, somewhat
offset by meaningful asset value from both its portfolio of
stations and non-core assets including its ownership of Safeco
Corporation stock and Fisher Plaza. Expectations for continued
positive free cash flow also support the ratings.
Summary of Actions
Fisher Communications, Inc.
-- Outlook, Changed To Positive From Stable
-- Affirmed B2 Corporate Family Rating
-- Affirmed B2 Probability of Default Rating
-- Affirmed B2 rating on Senior Unsecured Bonds, LGD4, 55%
-- Affirmed SGL-2 Speculative Grade Liquidity Rating
Fisher Communications, Inc., headquartered in Seattle, Washington,
operates television and radio broadcasting stations in the western
United States, as well as Fisher Plaza, a mixed use facility
located near downtown Seattle. Its annual revenue is
approximately $160 million.
GAP INC: Names Sabrina Simmons as Chief Financial Officer
---------------------------------------------------------
Gap Inc. disclosed that Sabrina Simmons, the company's executive
vice president of corporate finance and acting chief financial
officer, has been promoted to the position of chief financial
officer, effective immediately. She will continue to report to
Glenn Murphy, Gap Inc.'s chairman and chief executive officer, and
serve on the company's Executive Leadership Team.
"As Sabrina has taken on more responsibility over the years, her
deep knowledge of specialty retail, strong financial acumen and
personal integrity have earned her the respect of those inside and
outside the company," Mr. Murphy said. "After working closely
with Sabrina, it became clear that she has proven herself to be
extremely capable and is the right person to partner with me and
our business leaders to drive our financial priorities."
Ms. Simmons, 44, joined Gap Inc. nearly seven years ago as vice
president and treasurer. Prior to being named the company's
executive vice president and acting chief financial officer in
August 2007, Ms. Simmons served as senior vice president of
corporate finance where she was responsible for all corporate
finance functions including controllership, corporate finance
planning and analysis, investor relations, treasury, tax and risk
management.
"I'm very pleased to have this opportunity to serve as Gap Inc.'s
chief financial officer," Ms. Simmons said. "Gap Inc. maintains a
strong commitment to financial discipline and I look forward to
working with Glenn and our business leaders to develop near- and
long-term strategies to enhance shareholder value."
Before joining Gap Inc., Ms. Simmons held the position of chief
financial officer for Sygen International PLC, a British genetics
company now owned by Genus. She also spent five years at Levi
Strauss & Co., in addition to finance roles at Hewlett Packard and
KPMG.
Ms. Simmons received her B.S. in Finance from the University of
California, Berkeley and her M.B.A. from the University of
California, Los Angeles. She is also a California Certified
Public Accountant.
GCI INC: Moody's Puts Ba3 Rating on Review for Likely Downgrade
---------------------------------------------------------------
Moody's placed the Ba3 Corporate Family rating and B1 Senior
Unsecured rating of GCI Inc. under review for possible downgrade.
The rating action was prompted by the company's recent
announcement that it plans to construct a wireless network
throughout the state of Alaska, funded with debt. Moody's noted
that the increased capital expenditures associated with GCI's
planned wireless network build are occurring at a time when debt
levels are already expected to rise to fund pending acquisitions
and other capital spending initiatives.
In Moody's opinion the combination of these items is likely to
pressure key credit metrics to levels that are inconsistent with
GCI's current rating level. Moody's currently anticipates that
any downgrade of GCI's Corporate Family rating would be limited to
one notch. A two notch downgrade remains possible, however, and
would likely be driven by GCI targeting additional share
repurchases during the next couple of years while it completes its
significant capital spending plans. Moody's also noted that in
the event a downgrade occurs, GCI's senior unsecured rating would
likely be lowered by an additional notch relative to its Corporate
Family rating pursuant to the application of Moody's loss-given-
default methodology.
Downgrades:
Issuer: GCI, Inc.
-- Senior Unsecured Regular Bond/Debenture,
Downgraded to 80%: LGD5 from 74% - LGD5
On Review for Possible Downgrade:
Issuer: GCI, Inc.
-- Probability of Default Rating, Placed on Review for
Possible Downgrade, currently Ba3
-- Corporate Family Rating, Placed on Review for Possible
Downgrade, currently Ba3
-- Senior Unsecured Regular Bond/Debenture, Placed on Review
for Possible Downgrade, currently B1
Outlook Actions:
Issuer: GCI, Inc.
-- Outlook, Changed To Rating Under Review From Stable
The ratings review will focus on:
1) Moody's expectations of GCI's future operating performance in
the context of its new wireless strategy and the potential for
competition to increase within its carrier business,
2) the potential for GCI's capital spending to return to
sustainable levels beyond 2008, enabling the generation of free
cash flow for debt reduction,
3) GCI's funding plans for its capital spending initiatives and
the adequacy of its resulting liquidity profile, and
4) GCI's plans, if any, to return additional capital to
shareholders via continued share repurchases.
GCI, Inc. is a wholly owned subsidiary of General Communications
Inc, an integrated telecommunications provider based in Anchorage,
Alaska.
GENSOLLEN LLC: Voluntary Chapter 11 Case Summary
------------------------------------------------
Debtor: Gensollen, L.L.C.
247 East White Horse Pike
Galloway, NJ 08205
Tel: (609) 652-8250
Bankruptcy Case No.: 08-10782
Type of Business: The Debtor owns and operates a restaurant and a
night club.
Chapter 11 Petition Date: January 17, 2008
Court: District of New Jersey (Camden)
Debtor's Counsel: John J. Hutt, Esq.
508 New Jersey Avenue, Suite 3A
Absecon, NJ 08201
Tel: (609)641-4545
Fax: (609)641-4456
Estimated Assets: $1 Million to $100 Million
Estimated Debts: Unknown
The Debtor did not file a list of its largest unsecured creditors.
GLOBAL PAYMENT: Gets Finance Facility from Andre Soussa's Cos.
--------------------------------------------------------------
Global Payment Technologies Inc. has obtained a finance facility
pursuant to a Secured Term Note through affiliated entities
controlled by Andre Soussa. In addition, they will make an
additional investment in the company in approximately two weeks,
subject to the company's filing of its Annual Report on Form 10-K
for the fiscal year ended Sept. 30, 2007, and other customary
closing conditions.
At the close of the entire transaction, Mr. Soussa and his
affiliates will be the largest shareholders of the company and in
addition, Mr. Soussa will become chairman of the board and chief
executive officer of GPT as part of an overall restructuring of
the company.
At that time he will officially assume the title of chairman and
CEO and in addition, four of the five members of the existing
board of directors will be replaced. Richard Gerzof will remain
as a director but will relinquish his role as chairman and William
McMahon, previously interim president and CEO will remain with the
company as president and chief financial officer.
The agreements provide for the additional investment to be in the
form of a note convertible into a new preferred stock of the
company to be issued to the investors subject to shareholder
approval of an amendment to the company's charter to authorize
such preferred stock.
The preferred stock will provide that the holder will have five
votes per share effectively providing control of the company to
the holders of the preferred stock. In addition, Mr. Soussa
and/or his affiliates will receive warrants to purchase a number
of shares of the common stock of the company such that if
exercised it would constitute a majority of the issued and
outstanding stock of the company.
Andre Soussa is chairman and chief executive officer of Global
Payment Technologies Australia Pty. Ltd, GPT's customer and Asia
Pacific distributor. Mr. Soussa is also chief executive officer
of eCash Pty Ltd, a manufacturer and designer of electronic
payment systems.
"GPT was once known for its innovation and its position at the
forefront of the payment systems market and our goal is to restore
GPT to that position," Mr. Soussa stated. "Our first efforts will
be to implement changes designed to bring GPT to profitability and
we then intend to develop new and pioneering products. We will be
announcing these initiatives over the next few weeks as we work
quickly to stabilize and reinvigorate the business."
About Global Payment
Headquartered in Bohemia, New York, Global Payment Technologies
Inc. (NasdaqCM: GPTX) -- http://www.gptx.com/-- is a designer,
manufacturer, and marketer of automated currency acceptance and
validation systems used to receive and authenticate currencies in
a variety of payment applications worldwide. GPT's proprietary
and patented technologies are among the most advanced in the
industry.
Going Concern Doubt
As of June 30, 2007, the company had $1.2 million outstanding on
the line of credit with Laurus. The company was able to extend
the line of credit with Laurus until November 2007, but the
extension did not provide additional liquidity. The company is in
the process of negotiating a replacement line. If the company
cannot replace its line of credit with Laurus, it may be required
to repay all amounts due to them. The company is developing new
products for its market and will need to obtain additional capital
in order to continue to fund its development costs and capital
expenses related to tooling and marketing. These conditions raise
substantial doubt about the company's ability to continue as a
going concern.
GLOBECAT LTD: Moody's Attaches Low-B Ratings on Three Note Classes
------------------------------------------------------------------
Moody's Investors Service assigned ratings to three classes of
notes issued by GlobeCat Ltd.:
(1) B3 to the $40,000,000 Series USW Class A-1 Principal At-
Risk Variable Rate Notes due Jan. 2, 2013;
(2) B1 to the $20,000,000 Series CAQ Class A-1 Principal At-
Risk Variable Rate Notes due Jan. 2, 2013; and
(3) Ba3 to the $25,000,000 Series LAQ Class A-1 Principal At-
Risk Variable Rate Notes due Dec. 30, 2008.
Moody's rating addresses the ultimate cash receipt of all required
interest and principal payments as provided by the governing
documents, and is based on the expected loss posed to the
noteholders relative to the promise of receiving the present value
of such payments.
The ratings of the Notes are primarily derived from the conclusion
of analyses performed by Moody's of the occurrence probabilities
of earthquakes in California, windstorms in the North Atlantic and
earthquakes in Latin America over the risk period covered, as well
as the amounts lost should such events occur. In addition, the
ratings also consider the credit strength of the swap
counterparty, the credit strength of the sponsor, and the
effectiveness of the documentation in conveying the risks inherent
in the structure.
GOODYEAR TIRE: Holders Can Convert 4% Senior Notes Until March 31
-----------------------------------------------------------------
The Goodyear Tire & Rubber Company's 4% Convertible Senior Notes
due June 15, 2034 are now convertible at the option of the holders
and will remain convertible through March 31, 2008, the last
business day of the current fiscal quarter.
The notes became convertible because the last reported sale price
of the company's common stock for at least 20 trading days during
the 30 consecutive trading-day period ending on Jan. 16, 2008 (the
11th trading day of the current fiscal quarter), was greater than
120% of the conversion price in effect on such day. The notes
have been convertible in previous fiscal quarters.
The company will deliver shares of its common stock or pay cash
upon conversion of any notes surrendered on or prior to March 31,
2008. If shares are delivered, cash will be paid in lieu of
fractional shares only. Issued in July 2004, the notes are
currently convertible at a rate of 83.0703 shares of common stock
per $1,000 principal amount of notes, which is equal to a
conversion price of $12.04 per share.
During the fourth quarter of 2007, Goodyear completed an exchange
offer for outstanding notes for a cash payment and shares of
common stock. As a result, less than $4 million in aggregate
principal amount of notes remain outstanding. If all outstanding
notes are surrendered for conversion, the aggregate number of
shares of common stock issued would be approximately 0.3 million.
The notes could be convertible after March 31, 2008, if the sale
price condition described above is met in any future fiscal
quarter or if any of the other conditions to conversion set forth
in the indenture governing the notes are met.
About Goodyear Tire
Headquartered in Akron, Ohio, The Goodyear Tire & Rubber Company
(NYSE: GT) -- http://www.goodyear.com/-- is the world's largest
tire company. The company manufactures tires, engineered rubber
products and chemicals in more than 90 facilities in 28
countries. Goodyear's operations are located in Argentina,
Austria, Chile, Colombia, France, Italy, Guatemala, Jamaica,
Peru, Russia, among others. Goodyear employs more than 80,000
people worldwide.
* * *
In June 2007, Standard & Poor's Ratings Services raised its
ratings on Goodyear Tire & Rubber Co., including its corporate
credit rating to 'BB-' from 'B+'. The ratings still apply to
date.
GRANT PRIDECO: Earns $124.2 Million in 2007 Third Quarter
---------------------------------------------------------
Grant Prideco Inc. reported net income of $124.2 million on a 20%
increase in revenues to $539.9 million for the third quarter ended
Sept. 30, 2007. These results compare to net income of
$126.5 million, which included a $20.0 million license and royalty
fee on revenues of $451.3 million in 2006's third quarter.
"We are pleased to again report record quarterly revenues and
strong operating income, led by a 43% growth in revenues from our
Drilling Products segment over the same period last year,"
commented Michael McShane, chairman, president and chief executive
officer of Grant Prideco. "Our ReedHycalog segment also reported
strong revenue growth, up 16% over the same period last year.
That growth was led by our Andergauge drilling tool product line,
which was acquired in the fourth quarter of last year, and which
has shown 32% proforma revenue growth since the acquisition."
Consolidated revenues increased by $88.5 million, or 20%, compared
to 2006's third quarter, while consolidated operating income
margins decreased to 29.3% from 35.5% for the same period in 2006.
Excluding the license and royalty fee, operating income margins
decreased as a result of manufacturing inefficiencies and other
expenses related to the consolidation and relocation of four
ReedHycalog facilities to a new headquarters in Conroe, Texas,
totaling approximately $14.0 million.
Interest expense decreased by $1.5 million compared to 2006's
third quarter as a result of capitalizing interest related to
several large capital improvement projects the company has in
progress and other income improved to $935,000 due to interest
earned on the company's cash and investment balances. Equity
income from the company's investment in Voest-Alpine Tubulars
decreased by $2.3 million.
The company's effective tax rate was 29.8% for the third quarter
of 2007, flat with the 29.9% rate for 2006's third quarter and in
line with prior guidance.
Liquidity and Capital Resources
At Sept. 30, 2007, the company had cash and cash equivalents of
$241.0 million, working capital of $974.0 million and unused
borrowing availability of $359.3 million under its credit
facilities, compared to cash of $57.3 million, working capital of
$640.1 million and unused borrowing availability of $306.8 million
at Dec. 31, 2006.
Balance Sheet
At Sept. 30, 2007, the company's consolidated balance sheet showed
$2.34 billion in total assets, $614.7 million in total
liabilities, $18.2 million in minority interests, and
$1.71 billion in total stockholders' equity.
Full-text copies of the company's consolidated financial
statements for the quarter ended Sept. 30, 2007, are available for
free at http://researcharchives.com/t/s?2723
About Grant Prideco
Headquartered in Houston, Texas, Grant Prideco Inc. (NYSE: GRP) --
http://www.grantprideco.com/-- is an oilfield service company
specializing in drill stem technology development and drill pipe
manufacturing, sales and service. The company also provides high-
performance engineered connections and premium tubular products
and services.
* * *
As reported in the Troubled Company Reporter on Dec. 18, 2007,
Moody's Investors Service placed the Ba1 Corporate Family
Rating (and note rating) of Grant Prideco Inc. under review for
possible upgrade.
As reported in the Troubled Company Reporter on Dec. 18, 2007,
Standard & Poor's Ratings Services the 'BB+' corporate credit
rating on Grant Prideco Inc. on CreditWatch with positive
implications.
GREY WOLF: Earns $35.6 Million in 2007 Third Quarter
----------------------------------------------------
Grey Wolf Inc. reported net income of $35.6 million for the three
months ended Sept. 30, 2007, compared with net income of
$55.3 million for the third quarter of 2006.
Revenues for the third quarter of 2007 were $224.0 million
compared with revenues of $242.7 million for the same quarter a
year ago.
For the nine months ended Sept. 30, 2007, Grey Wolf reported net
income of $135.9 million on revenues of $693.5 million, compared
to net income of $167.4 million on revenues of $705.2 million for
the nine months ended Sept. 30, 2006. The 2006 results include a
second quarter after-tax gain related to insurance proceeds of
$2.7 million and a first quarter after-tax gain of $5.9 million
from the sale of five rigs formerly held for refurbishment.
Thomas Richards, chairman, president and chief executive officer
commented, "Grey Wolf continues to generate strong operating
results reflecting the company's strategy of operating premium
equipment, utilizing long-term contracts and performing turnkey
services. While leading edge dayrates have declined from a year
ago, they have been relatively stable over the past several
months.
"However, the influx of newly built drilling rigs into the market
is pressuring Grey Wolf's year-over-year average rig days worked
as well as contract renewal rates. Other contractual areas, such
as mobilization recoveries, are experiencing pricing pressure as
well. Our portfolio of long-term contracts helps to mitigate
these market fluctuations, and we continue to pursue a successful
strategy of owning high-quality rigs and enhancing our fleet under
long-term contracts."
Mr. Richards continued, "Grey Wolf's ability to provide equipment
that addresses the challenges of deep, directional or multi-well
site drilling is critical to meeting our customers' needs in the
most active domestic land drilling markets. The company's fleet
is well suited to these drilling opportunities given the
substantial upgrades completed during the past three years."
Mr. Richards concluded, "Our ultimate goal is to bring value to
our shareholders. Improving our rig fleet in a financially
prudent manner is significant to the long-term success of Grey
Wolf and our shareholders."
The company's earnings before interest expense, taxes,
depreciation and amortization ("EBITDA") totaled $83.7 million in
the third quarter of 2007 compared to $91.7 million for the second
quarter 2007 and $108.9 million for the third quarter 2006.
Capital expenditures totaled $67.3 million in the third quarter of
2007 and $190.1 million for the nine months ended Sept. 30, 2007.
Long-Term Debt
The company's $275.0 million of long-term debt at Sept. 30, 2007,
consists of $150.0 million of 3.75% Contingent Convertible Senior
Notes due 2023 and $125.0 million of Floating Rate Contingent
Convertible Senior Notes due 2024. The company's subsidiary, Grey
Wolf Drilling Company L.P., has a $100.0 million credit facility
with the CIT Group/Business Credit Inc. which expires on Dec. 31,
2008.
Balance Sheet
At Sept. 30, 2007, the company's consolidated balance sheet showed
$1.22 billion in total assets, $561.5 million in total
liabilities, and $657.5 million in total shareholders' equity.
Full-text copies of the company's consolidated financial
statements for the quarter ended Sept. 30, 2007, are available for
free at http://researcharchives.com/t/s?2725
About Grey Wolf
Headquartered in Houston, Texas, Grey Wolf Inc. (AMEX: GW) --
http://www.gwdrilling.com/-- provides turnkey and contract oil
and gas land drilling services in the best natural gas producing
regions in the United States with a current drilling rig fleet of
121, which will increase to 123 with the expected addition of two
new rigs in 2008.
* * *
Grey Wolf still carries Moody's Investors Service Ba3 corporate
family rating which was last placed on July 31, 2006. Outlook is
Stable.
GROMWELL LLC: Voluntary Chapter 11 Case Summary
-----------------------------------------------
Lead Debtor: Gromwell, L.L.C.
15 West 39th Street, 11th Floor
New York, NY 10018
Tel: (212) 972-9300
Bankruptcy Case No.: 08-10116
Debtor-affiliates filing separate Chapter 11 petitions:
Entity Case No.
------ --------
Gromwell Staffing, Inc. 08-10117
The Gromwell Group, Inc. 08-10119
Type of Business: The Debtor is a placement agency in the fashion,
financial and beauty businesses. It also
provides business administration services,
business facilities oversight and management
support services. See http://www.gromwell.com
Chapter 11 Petition Date: January 17, 2008
Court: Southern District of New York (Manhattan)
Judge: Robert E. Gerber
Debtors' 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
Estimated Assets Estimated Debts
---------------- ---------------
Gromwell, L.L.C. $1 Million to $1 Million to
$100 Million $100 Million
Gromwell Staffing, Inc. Less than $100,000 to
$10,000 $1 Million
The Gromwell Group, Inc. Less than $100,000 to
$10,000 $1 Million
The Debtors did not file lists of their largest unsecured
creditors.
HARRAH'S ENT: Hamlet Merger Wrap-Up Cues Securities Delisting
-------------------------------------------------------------
Harrah's Entertainment Inc. notified the New York Stock
Exchange, the Philadelphia Stock Exchange and the Chicago Stock
Exchange of its intent to delist its common stock, par value $0.10
per share, from the Exchanges immediately after the consummation
of the transactions contemplated by the agreement and plan of
merger dated as of Dec. 19, 2006, by and among Harrah's
Entertainment, Hamlet Holdings LLC and Hamlet Merger Inc.
At the effective time of the merger, each issued and outstanding
share of Harrah's common stock, other than shares of Harrah's
common stock owned by Hamlet Holdings LLC, Hamlet Merger Inc. or
any subsidiary of Hamlet Holdings LLC or Harrah's or held in the
treasury of Harrah's, will be canceled and converted into the
right to receive $90 in cash, without interest.
As a result of the merger, Harrah's will cease to be a publicly
traded company. Subject to customary closing conditions, Harrah's
expects to close the transaction on Jan. 28, 2008.
Headquartered in Las Vegas, Nevada, Harrah's Entertainment
Inc.(NYSE: HET) -- http://www.harrahs.com/-- has grown through
development of new properties, expansions and acquisitions, and
now owns or manages casino resorts on four continents and hosts
over 100 million visitors per year. The company's properties
operate under the Harrah's, Caesars and Horseshoe brand names;
Harrah's also owns the London Clubs International family of
casinos and the World Series of Poker. Harrah's also owns the
London Clubs International family of casinos.
* * *
As reported in Troubled Company Reporter on Jan. 17, 2008, Moody's
Investor Service assigned a B2 corporate family rating and
speculative grade liquidity rating of SGL-3 to Harrah's
Entertainment Inc. Moody's also assigned ratings to the
after new debt to be issued by Harrah's Operating Company,
Inc.: senior secured guaranteed bank revolving credit
facility at Ba2, senior secured guaranteed term loans at Ba2, and
senior unsecured guaranteed notes at B3. HOC is a whollyowned
direct subsidiary of HET. The rating outlook is stable.
HARRAH'S ENT: S&P Cuts Ratings on $47.6 Bil. of Existing Notes
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on Las
Vegas-based Harrah's Entertainment Inc. and its wholly owned
subsidiary, Harrah's Operating Co. Inc. The corporate credit
rating on each entity was lowered to 'B+' from 'BB'. In addition,
S&P's senior unsecured and subordinated debt ratings on
approximately $4.6 billion of existing notes, which will be rolled
over as part of the transaction, were both lowered to 'B-', from
'BB' and 'B+', respectively. The ratings were removed from
CreditWatch, where they were placed with negative implications on
Oct. 2, 2006. The rating outlook is stable. S&P's ratings on
the remaining existing debt, which totals nearly $7.6 billion,
will remain on CreditWatch. These issues will be refinanced with
proceeds from proposed new debt, and the ratings will be withdrawn
upon the close of the transaction.
At the same time, Standard & Poor's assigned ratings to HOC's
proposed $9.25 billion senior secured bank facility, consisting of
a $2 billion revolving credit facility due 2014 and a
$7.25 billion term loan due 2015. The facility was rated 'BB'
(two notches higher than the 'B+' corporate credit rating) with a
recovery rating of '1', indicating the expectation for very
high (90% to 100%) recovery in the event of a payment default.
Standard & Poor's also assigned its 'B-' rating (two notches lower
than the corporate credit rating) to HOC's proposed $6.775 billion
senior unsecured notes offering, which will consist of
$5.275 billion of cash pay notes due 2016 and $1.5 billion of
toggle notes due 2018. Although both the currently existing
senior unsecured and subordinated notes issues are structurally
subordinated to the proposed new senior notes, all debt issues are
rated 'B-'. This is because, when comparing the proposed level of
senior secured debt in the capital structure to Harrah's adjusted
tangible assets, the level exceeds S&P's threshold of 30%,
resulting in all other debt being rated two notches below the
corporate credit rating. The 30% threshold is surpassed whether
the calculation is performed only at HOC, or on a consolidated
basis.
The corporate credit rating downgrade reflects S&P's expectation
for substantially weaker credit metrics following the completion
of the proposed acquisition of Harrah's by Apollo Management LP
and Texas Pacific Group (TPG) for approximately $31.2 billion,
including the assumption of a portion of existing debt, fees, and
expenses. Furthermore, given the importance of capital spending
in the gaming industry, S&P believes that Harrah's business risk
profile is slightly weakened by the limitations on both free cash
flow generation and financial flexibility imposed by its post-LBO
capital structure. Proceeds from the proposed debt offerings,
along with up to $6.5 billion of CMBS financing, $4.6 billion of
rollover debt, and $6.1 billion of new equity (consisting of
$4.1 billion of common equity and $2 billion of PIK preferred
equity), will be used to fund the transaction.
The current 'B+' rating reflects Harrah's high debt leverage and
S&P's expectation that the company will not generate positive free
operating cash flow over the next few years, given a relatively
aggressive pipeline of development activities and heightened debt
service obligations. Still, the company maintains a strong
business profile, with a well-diversified and good-quality
portfolio of assets, a solid brand identity, and an effective
customer loyalty program.
HEALTH MANAGEMENT: Poor Profitability Cues Fitch to Cut Ratings
---------------------------------------------------------------
Fitch Ratings downgraded Health Management Associates Inc.'s
ratings as:
-- Issuer Default Rating to 'B+' from 'BB-';
-- Subordinated convertible notes to 'B-/RR6' from 'B+'.
In addition, Fitch has assigned these Recovery Ratings:
-- Secured bank facility to 'BB/RR2' from 'BB';
-- Senior secured notes to 'BB/RR2' from 'BB'.
The Outlook is Stable.
The rating action reflects HMA's deteriorating profitability and
growing concern regarding HMA's ability to organically reduce debt
over the next few years. In January 2007 HMA paid a debt-funded
special one-time dividend of $10 per share (for a total of
approximately $2.4 billion). Since then, HMA has experienced
declining profitability and cash flows which have led to debt
reduction below expectations. At the same time, HMA has
encountered growing industry pressures, particularly rising bad
debt and weak volume growth.
Rising bad debt expense has significantly affected HMA's
profitability over the last year. During this time, HMA changed
its bad debt accounting methodology such that it now reserves for
bad debts at 12% of revenues versus historical averages near 7.5%-
9% . Fitch notes that total uncompensated care has also increased
during this time frame, although to a lesser extent, as HMA has
decreased its charity care. At the same time, HMA continues to
experience weak same-store admissions growth. Although there may
be some moderation in these trends, Fitch believes HMA will
continue to be pressured by these issues in the near future.
In addition to industry challenges, HMA's ratings reflect the
company's significant debt and leverage. At Sept. 30, 2007, HMA
had approximately $3.8 billion in debt outstanding with leverage
of 5.18 times for the last 12 months ended Sept. 30, 2007. Fitch
believes that HMA will focus on deleveraging over the next few
years. Accordingly, Fitch expects HMA to become less acquisitive
and to manage capital expenditures. In addition, HMA may also
pursue asset divestitures to fund further debt reduction.
Although debt levels are high, Fitch believes HMA has ample
liquidity to fund business needs. Liquidity is provided by cash
flow from operations ($324 million for the LTM ended Sept. 30,
2007), cash on hand ($114.6 million at Sept. 30, 2007) and the
company's $500 million senior secured revolver expiring 2013
($463.4 million available at Sept. 30, 2007).
Finally, Fitch notes that HMA's 1.50% convertible senior
subordinated notes due 2023 have a put option on Aug. 1, 2008.
Fitch expects HMA will need to refinance the obligation or make a
concession to the noteholders similar to the incremental put
payment of 2.875% per annum made as a result of the last put
option on Aug. 1, 2006. As a result, HMA may experience
incremental interest expense in 2008.
HOVNANIAN ENT: Moody's Cuts All Ratings on Projected Recession
--------------------------------------------------------------
Moody's Investors Service lowered all of the ratings of K.
Hovnanian Enterprises, Inc., including its corporate family rating
to B2 from Ba3, ratings on the senior notes to B2 from Ba3,
ratings on the subordinated notes to Caa1 from B2, and rating on
the preferred stock to Caa2 from B2. The ratings remain on review
for possible further downgrade, continuing the review process that
was initiated on Dec. 19, 2007.
The downgrades reflect Moody's expectation that for fiscal 2008,
the company's operating and credit metrics will continue to
deteriorate, declining to levels more commensurate with the mid-B
ratings category. In particular, Moody's projects the company's
fiscal 2008 operating earnings before impairments and option
abandonments to be negative, interest coverage to be below 0.5
times, and debt leverage to be well above 60%.
The review will focus on Hovnanian's ability to obtain long-term
covenant relief, not just for its tripping of certain covenants in
its fourth fiscal quarter ended Oct. 31, 2007 but, more
importantly, for the continued pressures it will face in the
coming year on the covenants pertaining to interest coverage,
minimum tangible net worth, and debt leverage.
Going forward, the ratings could be taken off review for downgrade
if the company is successful in obtaining substantial covenant
relief.
The outlook could be changed to stable if:
(i) Hovnanian were to begin generating significant amounts of
positive cash flow and
(ii) if the company were to reduce its debt leverage to 55% and
rebuild its interest coverage protection.
The ratings could be lowered further if:
(i) the company does not receive the required amendments from its
bank group or if the permitted headroom were very narrow;
(ii) the company's cash flow were again to turn negative on a
trailing twelve month basis;
(iii) the company makes significant share repurchases; and/or
(iv) the company's debt leverage were to increase above 75%.
These rating actions were taken:
-- Corporate family rating lowered to B2 from Ba3;
-- Probability of default rating lowered to B2 from Ba3;
-- Senior notes ratings lowered to B2 (LGD-3, 45%) from Ba3
(LGD-3, 46%);
-- Senior subordinated notes ratings lowered to Caa1
(LGD-6, 92%) from B2 (LGD-6, 91%);
Preferred stock rating lowered to Caa2 (LGD-6, 96%) from B2 (LGD-
6, 96%). The notching on the preferred stock has been widened to
reflect the recently missed dividend payment and the likelihood
that this situation will persist throughout 2008.
Established in 1959 and headquartered in Red Bank, New Jersey,
Hovnanian Enterprises, Inc. designs, constructs and markets
single-family detached homes and attached condominium apartments
and townhouses. Homebuilding revenues and consolidated net income
(before preferred dividends) for fiscal 2007 were $4.7 billion and
-$627 million, respectively.
INDYMAC BANK: Moody's Lowers Long Term Deposit Rating to Ba3
------------------------------------------------------------
Moody's downgraded Indymac Bank F.S.B.'s bank financial strength
rating to D- from D+ and its long-term deposit rating to Ba3 from
Ba1. Indymac Bancorp, Inc.'s issuer rating was downgraded to B1
from Ba2. This concludes the review that was initiated on
Nov. 29, 2007.
Moody's said that the downgrade reflects the rating agency's
concern that Indymac's capital could be significantly impaired and
franchise has experienced impairment. Indymac's loan portfolios
have exhibited significant deterioration and Moody's expects
Indymac to report losses for several quarters due to higher
provisioning and mortgage asset write-downs. These losses could
be at a level that impairs capital.
Regarding franchise impairment, Moody's said that the current
market distribution has required Indymac to shift its origination
channel, product mix, and secondary marketing strategies.
"Indymac is at a distinct disadvantage to its branch-banking
competitors who have much more robust retail origination channels,
balance sheet capacity to hold non-agency loans and low cost
deposit funding," said Moody's Vice-President Craig Emrick. "We
expect Indymac to lose market share and struggle to be cost
competitive as an agency only originator in 2008," continued Mr.
Emrick.
Moody's noted that the thrift has had stable liquidity through the
recent market events by focusing its funding on deposits and
Federal Home Loan Bank advances. Indymac's current short term
wholesale funding is less than its unutilized capacity at the
FHLB. Moody's does not see any liquidity issues at the holding
company.
An upgrade to the rating is unlikely over the medium term.
Stabilization of the rating at its current levels would require a
plateauing of asset quality deterioration, maintenance of current
capital levels and two quarters of consistent profitability.
A downgrade to the rating would result from asset quality
deterioration at an accelerated rate, a view that capital levels
could fall below well-capitalized minimums or a disruption in
deposit taking activities.
Downgrades:
Issuer: Indymac Bancorp. Inc.
-- Issuer Rating, Downgraded to B1 from Ba2
Issuer: Indymac Bank, F.S.B.
-- Bank Financial Strength Rating, Downgraded to D- from D+
-- Issuer Rating, Downgraded to Ba3 from Ba1
-- OSO Senior Unsecured OSO Rating, Downgraded to Ba3 from
Ba1
-- Preferred Stock Preferred Stock, Downgraded to B2 from Ba3
-- Senior Unsecured Deposit Rating, Downgraded to Ba3 from
Ba1
Outlook Actions:
Issuer: Indymac Bancorp. Inc.
-- Outlook, Changed To Negative From Rating Under Review
Issuer: Indymac Bank, F.S.B.
-- Outlook, Changed To Negative From Rating Under Review
Indymac Bancorp, Inc. is a residential mortgage originator and
servicer located in Pasadena, CA. At Sept. 30, 2007 Indymac
reported assets of $33.7 billion.
INTERACTIVE SYSTEMS: Net Loss Slides to $2.42MM in Fiscal 2007
--------------------------------------------------------------
Interactive Systems Worldwide Inc. reported $2.42 million net loss
for fiscal year ended Sept. 30, 2007, compared with $4.72 million
net loss during fiscal 2006 . This decrease of 49% in the net
loss applicable to common stock in fiscal 2007 is due to lower
expenses and increased revenue and other income.
During Fiscal 2007, ISWI achieved an important milestone, the
launch in the UK of the company's enhanced, fully-integrated
version of the SportXction(R) System with Sportingbet and
Ladbrokes. The system is operated by Global Interactive Gaming
Ltd., the company's UK subsidiary.
"We are very pleased with the wagering volume from our operations
in the UK," Bernard Albanese, ISWI's chief executive officer,
said. "Since our launch approximately one year ago, the wagering
volume handled by the system has steadily increased. The size of
this increase in one year demonstrates the appeal of the product
and should help us to secure additional business worldwide. The
Company is in discussions with several major European bookmakers,
and we are hopeful that the continued interest in the types of
wagering offered by this unique system will result in the securing
of one or more additional partners."
Management's immediate priority is to address the company's
liquidity issues. ISWI anticipates that its existing resources
will be adequate to fund its capital and operating requirements
only through January 2008 unless it is able to raise additional
capital or execute a strategic transaction. Management is hopeful
that it can address the company's immediate cash needs, providing
the company more time to effect a longer-term solution.
As of Sept. 30, 2007, the company had liquid resources totaling
$284,000 which consisted of cash.
At Sept. 30, 2007, the company's balance sheet showed total assets
of $901,000, total liabilities of $835,000 and total stockholder's
equity of $66,000.
The company's balance sheet also showed strained liquidity with
total current assets of $473,000 available to pay total current
liabilities of $835,000.
Going Concern Doubt
Eisner LLP, in New York City raised substantial doubt about
Interactive Systems Worldwide Inc.'s ability to continue as a
going concern after auditing the financial statements of
Interactive Systems Worldwide Inc. and subsidiaries for periods
ended Sept. 30, 2007 and 2006. The auditors pointed to the
company's incurred net losses of $2.18 million in 2007 and
$4.45 million in 2006, and a working capital deficiency.
In addition, the company requires additional financing to meet its
forecasted cash requirements during fiscal 2008.
About Interactive Systems
Headquartered in West Paterson, N.J., Interactive Systems
Worldwide Inc. (OTC BB: ISWI.OB) has designed, developed and
patented a proprietary software system, the SportXction System,
which enables play-by-play wagering during the course of live
sporting events. ISWI, through its wholly owned subsidiary Global
Interactive Gaming (GIG), operates the SportXction(R) System in
the U.K., in conjunction with established media and traditional
wagering partners. The system can accept wagers from the
Internet, handheld wireless devices, interactive televisions, and
standalone kiosks. The system can be used for any live broadcast
event worldwide.
INVACARE CORP: President Gerald Blouch Assumes Acting CFO Role
--------------------------------------------------------------
Gregory Thompson, Invacare Corporation's chief financial officer,
has informed the company of his decision to leave the company for
another opportunity. Mr. Thompson has agreed to continue on in
his current capacity through March 1, at which time Gerald Blouch,
president and chief operating officer, will assume the additional
responsibilities as acting chief financial officer.
Mr. Blouch joined Invacare in 1990 as chief financial officer. He
became chief operating officer in 1993 and later was named
president as well. Beginning immediately, Invacare will undertake
a search for candidates to assume the role of chief financial
officer on a permanent basis.
"We wish Greg well and thank him for his contributions to the
success of our company," A. Malachi Mixon, III, chairman and chief
executive officer of Invacare Corporation, said. "We are sure he
will be successful in his new endeavor."
About Invacare Corp.
Headquartered in Elyria, Ohio, Invacare Corporation (NYSE: IVC) --
http://www.invacare.com/-- manufactures and distributes
innovative home and long-term care medical products. The company
has 5,700 associates and markets its products in 80 countries
around the world.
* * *
Moody's Investor Service placed Invacare Corporation's long term
corporate family and probability of default ratings at 'B1' in
January 2007. The ratings still hold to date with a stable
outlook.
JONES CREEK: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: Jones Creek Golf Club & Performance Center, LLC
777 Jones Creek Drive
Evans, GA 30809
Tel: (706) 860-4228
Bankruptcy Case No.: 08-10072
Type of Business: The Debtor is a golf destination site.
See: http://www.jonescreekgolfclub.com/
Chapter 11 Petition Date: January 16, 2008
Court: Southern District of Georgia (Augusta)
Judge: John S. Dalis
Debtors' Counsel: Natashia M. Bush, Esq.
Natashia M. Bush, PC
P.O. Box 204229
Augusta, GA 30917
Tel: (706) 922-5966
Fax: (706) 922-5967
http://www.mycsralawyer.com/
Total Assets: $5,700,000
Total Debts: $4,700,000
Consolidated Debtors' List of 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Textron Financial value of security: $50,000
40 Westminister Street $50,000
Providence, RI 02903
Club Car value of security: $50,000
4152 Washington Road $25,000
Augusta, GA 30907
Taylor Made $3,000
5545 Fermi Court
Carlsbad, CA 800-888-2582
Georgia Power $3,000
Southern AG & Turf Supply $2,500
Lowe's $2,000
Knology $1,000
Foot Joy $1,000
Callaway $1,500
Pima Direct $1,200
Titlest $1,000
Sysco $1,000
Adidas $1,000
Crescent Software $500
AT&T/Bellsouth Regional $500
Bankruptcy Court
Coca-Cola $500
M.L. Wilson $500
Polo $500
U.S. Foodservice $100
Georgia Bank and Trust $1
JOSEPH RECKELHOFF: Case Summary & 14 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Joseph Francis Reckelhoff
551 Montgomery Drive
Westfield, IN 46074
Bankruptcy Case No.: 08-00409
Chapter 11 Petition Date: January 16, 2008
Court: Southern District of Indiana (Indianapolis)
Judge: Basil H. Lorch III
Debtor's Counsel: Edward B. Hopper, II, Esq.
Stewart & Irwin PC
251 East Ohio Street Suite 1100
Indianapolis, IN 46204
Tel: (317) 639-5454
Total Assets: $253,000
Total Debts: $5,800,033
Debtor's list of its 14 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Community Bank Kensington $998,785
830 Logan Street Carriage Homes
Noblesville, IN 46060 personal loan
guarantee
construction loan $940,926
First Indiana Bank Kensington $934,953
P.O. Box 44220 Carriage Homes,LLC
Indianapolis, IN 46244,4220 personal loan
guarantees
Homes by Reckelhoff $462,144
Corp. personal loan
guarantee
personal loan $248,750
guarantee
National City Bank Kensington Carriage $788,000
P.O. Box 1821 Homes, LLC
Dayton, OH 45482-0440 personal loan
guarantees
C&R Custom Homes $512,000
personal loan
guarantees
American Express Business Credit Card $108,298
C&R Custom Homes $24,977
business credit card
National City Bank - personal credit card $50,000
Pennsylvania
Capital One Business credit card $48,162
ICC Floors Business debt $36,865
National City - Kentucky Business credit card $33,576
GMAC Mortgage Location: 551 $32,900
Montgomery Drive, ($189,000
Westfield IN secured)
3 bedroom, 2.5 baths, ($176,000
2 story, 2 car senior lien)
garage, 2300 sq.ft.
purchase date 2006
purchase price $219,00
84 Lumber Business transactions $30,596
Regions Commercial Loan Business credit card $29,130
National City Bank - Ohio Student loan for son $29,000
Joshua Reckelhoff
State Farm Insurance Business debt $28,213
Citibank Rockhouse International $24,200
business credit card
JPMORGAN CHASE: Moody's Places Financial Strength Rating at B2
--------------------------------------------------------------
Moody's Investors Service commented that it had already
incorporated in its rating analysis the possibility that JPMorgan
Chase's 4Q07 net income could be hurt by a poor result in its
Investment Bank and continued high loan-loss provisions in its
Retail Financial Services group. JPMorgan Chase's reported net
profit was $3 billion in 4Q07. Moody's rates JPM B+ for financial
strength and Aaa for deposits. The holding company's senior debt
is rated Aa2. The rating outlook is stable.
Moody's said that its major concern for JPM is the possible credit
cost related to JPM's $94.8 billion home-equity exposure and JPM's
$15.5 billion subprime exposure. "What gives us comfort is that
JPM has high capital ratios allowing it to take sizable charges
and still be well capitalized", said Moody's Senior Vice
President, Sean Jones.
Moody's said that JPM's Investment Bank reported modest quarterly
earnings due to marks taken against an array of asset classes
including collateralized-debt-obligations, and non-subprime
securitized products. Moody's has monitored JPM's gross
exposures, and it believes that these troubled balances have been
reduced to relatively modest net positions. An area of increased
focus is the effectiveness of JPM's credit hedge against its
$15.5 billion commercial-mortgage-back-securities portfolio.
Moody's said that although JPM faces challenging times in some of
its other businesses including its sizable credit-card operations,
its overall business diversity supports its ability to generate
capital.
JPMorgan Chase is headquartered in New York City, New York, and
its reported assets as of December 31st were $1.6 trillion.
LE-NATURE'S INC: Giant Eagle to Re-Open Newly Bought Latrobe Plant
------------------------------------------------------------------
Giant Eagle Inc. said last week that it intends to re-open a
bottling and water purification facility it bought from Le-
Nature's Inc., Tim Schooley writes for Pittsburgh Business Times.
As reported in the Troubled Company Reporter on Sept. 20, 2007,
R. Todd Neilson, the chapter 11 trustee overseeing Le-Nature's
Inc.'s estates, has asked the Hon. M. Bruce McCullough of the U.S.
Bankruptcy Court for the Western District of Pennsylvania to
approve a sale of the Debtors' Latrobe plant to Giant Eagle.
Under a settlement agreement, Cadbury Schweppes PLC will complete
its acquisition of the facility for $19 million. Cadbury
Schweppes will then resell it to Giant Eagle at the same price.
Under the agreement, Giant Eagle will forfeit its $2 million
deposit and pay Mr. Neilson $2.25 million to be used to
distributed to creditors.
The facility located in Latrobe, Pennsylvania, now named as
Chestnut Ridge Beverage Co., has began production of bottled
water, teas and sodas under the Giant Eagle Brand, Business Times
says. In addition, Chestnut Ridge is currenlty looking for other
production opportunities besides the Giant Eagle brand, Business
Times relates.
Dan Shapira, Esq., counsel to Giant Eagle, said that with Chestnut
Ridge in operation, Latrobe community will have additional
employment opportunities, Business Times reports. Chestnut Ridge
intends to employ about 50 workers and may further increase its
work force as demand increases, Business Times adds, citing
Charley Price, president of operation.
About Le-Nature's Inc.
Headquartered in Latrobe, Pennsylvania, Le-Nature's Inc. --
http://www.le-natures.com/-- makes bottled waters, teas, juices
and nutritional drinks. Its brands include Kettle Brewed Ice
Teas, Dazzler fruit juice drinks and lemonade, and AquaAde
vitamin-enriched water.
Four unsecured creditors of Le-Nature's filed an involuntary
chapter 7 petition against the company on Nov. 1, 2006 (Bankr.
W.D. Pa. Case No. 06-25454). On Nov. 6, 2006, two of Le-Nature's
subsidiaries, Le-Nature's Holdings Inc., and Tea Systems
International Inc., filed voluntary petitions for relief under
chapter 11 of the Bankruptcy Code. Judge McCullough converted Le
Nature's Inc.'s case to a chapter 11 proceeding. The Debtors'
cases are jointly administered. The Debtors' schedules filed with
the Court showed $40 million in total assets and $450 million in
total liabilities.
Douglas Anthony Campbell, Esq., Ronald B. Roteman, Esq., and
Stanley Edward Levine, Esq., at Campbell & Levine, LLC, represents
the Debtors in their restructuring efforts. The Court appointed
R. Todd Neilson as Chapter 11 Trustee. Dean Z. Ziehl, Esq.,
Richard M. Pachulski, Esq., Stan Goldich, Esq., Ilan D. Scharf,
Esq., and Debra Grassgreen, Esq., at Pachulski, Stang, Ziehl,
Young, Jones & Weintraub LLP, represent the Chapter 11 Trustee.
David K. Rudov, Esq., at Rudov & Stein, and S. Jason Teele, Esq.,
and Thomas A. Pitta, Esq. at Lowenstein Sandler PC, represent the
Official Committee of Unsecured Creditors. Edward S. Weisfelner,
Esq., Robert J. Stark, Esq., and Andrew Dash, Esq., at Brown
Rudnick Berlack Israels LLP, and James G. McLean, Esq., at Manion
McDonough & Lucas represent the Ad Hoc Committee of Secured
Lenders. Thomas Moers Mayer, Esq., and Matthew J. Williams, Esq.
at Kramer Levin Naftalis & Frankel LLP, represent the Ad Hoc
Committee of Senior Subordinated Noteholders.
LEHMAN MORTGAGE: Moody's Downgrades Ratings on Four Tranches
------------------------------------------------------------
Moody's Investors Service downgraded the ratings of four tranches
Lehman Mortgage Trust 2007-5. The collateral backing these
classes consists of primarily first lien, fixed rate, Alt-A
mortgage loans.
The ratings were downgraded and placed under review for downgrade
based on higher than anticipated rates of delinquency in the
underlying collateral relative to credit enhancement levels. In
its re-rating Moody's has also applied its published methodology
updates to the non delinquent portion of the transactions.
Complete list of rating actions:
Issuer: Lehman Mortgage Trust 2007-5
-- Cl. 2B2, Downgraded to Baa2, previously A2,
-- Cl. 2B3, Downgraded to Ba2, previously Baa2,
-- Cl. 2B4, Downgraded to B2, previously Ba2,
-- Cl. 2B5, Downgraded to Caa1, previously B2.
LEVITT AND SONS: Lee County Property Bid Deadline is January 28
---------------------------------------------------------------
The Honorable Raymond B. Ray of the U.S. Bankruptcy Court for the
Southern District of Florida disclosed that the deadline for
parties to submit a bid on Levitt and Sons of Lee County, LLC's
real property, which is up for sale, will be on Jan. 28, 2008, at
5:00 p.m.
An auction to sell the property will be conducted on
Jan. 30, 2008, at 10:00 a.m. at the offices of:
Berger Singerman, P.A.
350 East Las Olas Boulevard
Suite 1000
Fort Lauderdale, FL 33301
Additionally, the Court disclosed that a hearing to confirm the
auction will be held before Judge Ray on Jan. 31, 2008, at
11:00 a.m., Courtroom 308, 299 East Broward Boulevard, in Fort
Lauderdale, Florida.
About Levitt and Sons
Based in Fort Lauderdale, Florida, Levitt and Sons LLC --
http://www.levittandsons.com/-- is the homebuilding subsidiary of
Levitt Corporation (NYSE:LEV). Levitt Corp. --
http://www.levittcorporation.com/-- together with its
subsidiaries, operates as a homebuilding and real estate
development company in the southeastern United States. The
company operates in two divisions, homebuilding and land. The
homebuilding division primarily develops single and multi-family
homes for adults and families in Florida, Georgia, Tennessee, and
South Carolina. The land division engages in the development of
master-planned communities in Florida and South Carolina.
Levitt and Sons LLC and 38 of its homebuilding affiliates filed
for Chapter 11 protection on Nov. 9, 2007 (Bankr. S.D. Fla. Lead
Case No. 07-19845). Paul Singerman, Esq. and Jordi Guso, Esq., at
Berger Singerman, P.A., represent the Debtors in their
restructuring efforts. The Debtors chose AP Services, LLC as
their crisis managers, and Kurtzman Carson Consultants, LLC as
their claims and noticing agent. Levitt Corp., the parent
company, is not included in the bankruptcy filing.
The Debtors' latest consolidated financial condition as of
Sept. 30, 2007 reflect total assets of $900,392,000, and total
liabilities of $780,969,000. (Levitt and Sons Bankruptcy News,
Issue No. 9; Bankruptcy Creditors' Service Inc.;
http://bankrupt.com/newsstand/or 215/945-7000)
The Debtors' exclusive plan filing period expires on March 8,
2008.
LIFEPOINT HOSPITALS: Earns $28.2 Million in 2007 Third Quarter
--------------------------------------------------------------
LifePoint Hospitals Inc. reported net income of $28.2 million for
the third quarter ended Sept. 30, 2007, compared with net income
of $34.9 million for the same period in 2006.
For the third quarter ended Sept. 30, 2007, revenues from
continuing operations were $656.2 million, up 4.6% from
$627.3 million for the same period a year ago. Income from
continuing operations for the quarter decreased 6.9% to
$31.6 million, compared with income from continuing operations for
the third quarter of 2006 of $34.0 million.
For the nine months ended Sept. 30, 2007, revenues from continuing
operations were $1.97 billion, up 11.5% from $1.77 billion for the
same nine-month period in 2006. Income from continuing operations
for the nine months ended Sept. 30, 2007, decreased 10.8% to
$94.9 million, compared with income from continuing operations for
the nine months ended Sept. 30, 2006, of $106.4 million. Net
income for the nine months ended Sept. 30, 2007, decreased 33.8%
to $71.4 million, compared with net income for the same nine-month
period in 2006 of $107.8 million.
In commenting on the results, William F. Carpenter III, president
and chief executive officer of LifePoint Hospitals, said, "We are
making progress in addressing industry challenges by implementing
our strategic plan. Our intense, company-wide focus on growing
market share and managing costs is bearing fruit. In addition,
the contribution of physicians on staff and continuing recruitment
efforts are adding value in our hospital communities. We are
succeeding because of energized employees who understand their
mission, have years of operating experience and a track record for
improving shareholder value. We remain excited about the
remainder of the year and look forward to 2008 with confidence in
our strategy and thepeople who will execute it."
Total Debt/Leverage
At Sept. 30, 2007, total debt of the company stood at
$1.52 billion, a decrease of $151.4 million compared to total debt
of $1.67 billion at Dec. 31, 2006. Total debt-to-total
capitalization was $49.4% at Sept. 30, 2007, versus $53.5% at
Dec. 31, 2006. The company uses leverage to make financing
decisions.
Balance Sheet
At Sept. 30, 2007, the company's consolidated balance sheet showed
$3.63 billion in total assets, $2.06 billion in total liabilities,
$15.7 million in minority interests in equity of consolidated
entities, and $1.55 billion in total stockholders' equity.
Full-text copies of the company's consolidated financial
statements for the quarter ended Sept. 30, 2007, are available for
free at -- http://researcharchives.com/--
About LifePoint Hospitals Inc.
Based in Brentwood, Tennessee, LifePoint Hospitals Inc. (NASDAQ:
LPNT) -- http://www.lifepointhospitals.com/-- is a hospital
company that provides healthcare services in non-urban communities
in 18 states. Of the company's 49 hospitals, 44 are in
communities where LifePoint Hospitals is the sole community
hospital provider. LifePoint Hospitals' non-urban operating
strategy offers continued operational improvement by focusing on
its five core values: delivering compassionate, high quality
patient care; supporting physicians; creating an outstanding
environment for employees; providing unmatched community value;
and ensuring fiscal responsibility. LifePoint Hospitals is
affiliated with approximately 21,000 employees.
* * *
Moody's Investor Services placed LifePoint Hospitals Inc.'s
probability of default rating at 'Ba3' in September 2006 and its
bank loan debt rating at 'Ba2' in May 2007. The ratings still
hold to date with a stable outlook.
M/I HOMES: Moody's Slashes Ratings; Retains Negative Outlook
------------------------------------------------------------
Moody's Investors Service lowered the ratings of M/I Homes, Inc.,
including its corporate family rating to B1 from Ba3 and senior
unsecured notes to B1 from Ba3. The ratings outlook remains
negative.
The downgrade was prompted by:
(i) Moody's expectations that the company's pre-impairment
operating earnings will be negative in 2008;
(ii) the possibility that the company may have to seek further
covenant relief from its bank group in 2008; and
(iii) the company's large exposure to particularly weak markets
that may inhibit the company's actual inventory reduction
capability going forward.
The negative outlook reflects Moody's expectation that the
homebuilding market will continue to deteriorate in 2008, thus
making the company's operating and credit metrics likely to weaken
further. The outlook also takes into consideration that M/I Homes
derives a significant proportion of its revenues and operating
income from markets in Florida and the Midwest that are continuing
to undergo a considerable correction.
The ratings acknowledge the company's historically conservative
and disciplined growth strategy and moderate debt leverage.
Going forward, the company's outlook and ratings could stabilize
if the headroom under the bank credit facility's covenants,
particularly interest coverage, were to widen significantly and
the company were to become even more strongly cash flow positive
on an LTM basis.
The ratings could be reduced again if any of these were to occur:
(i) the company turns cash flow negative on an LTM basis; (
ii) the company were to face problems with amending its covenants
if it becomes necessary; and/or
(iii) debt leverage exceeds 60% for longer than a brief period of
time.
These rating actions were taken:
-- Corporate family rating downgraded to B1 from Ba3;
-- Probability of default rating downgraded to B1 from Ba3;
-- Senior unsecured debt ratings downgraded to B1
(LGD4, 51%) from Ba3 (LGD4, 56%);
-- Preferred stock downgraded to B3 (LGD6, 94%) from B2
(LGD6, 94%)
Headquartered in Columbus, Ohio and begun in 1976, M/I Homes, Inc.
sells homes under the trade names M/I Homes and Showcase Homes,
with homebuilding operations located in Columbus and Cincinnati,
Ohio; Indianapolis, Indiana; Tampa and Orlando, Florida; Charlotte
and Raleigh, North Carolina; and the Virginia and Maryland suburbs
of Washington, D.C. Homebuilding revenues and consolidated net
income (before preferred dividends) for the trailing twelve months
ended Sept. 30, 2007 were $1.2 billion and -$71 million,
respectively.
MARCAL PAPER: Files Second Amended Disclosure Statement
-------------------------------------------------------
Marcal Paper Mills Inc. delivered a Second Amended Disclosure
Statement dated Jan. 10, 2008, describing its Second Amended
Chapter 11 Plan of Reorganization to the United States Bankruptcy
Court for the District of New Jersey.
Overview of the Plan
The amended Plan provides for the sale of substantially all of the
Debtor's assets to a designee of NexBank SSB as agent under the
second lien loan agreement.
On Oct. 2, 2007, the Debtor gave notice that it was going to sell
its assets. In November 2007, as reported in the Troubled Company
Reporter, the Debtor's proposed bidding procedure was approved by
the Court, in which NexBank offered $121.6 million for the assets,
which includes a credit bid of $35 million and $6 million cash.
The plan also provides for the disposition of any remaining assets
for distribution by the liquidating trustee under the liquidating
trust agreement, and the distribution of net proceeds to holders
of allowed claims consistent with the priority provisions of the
Bankruptcy Code.
The Plan does not contemplate for the continuation of the Debtor's
business after the consumation of the proposed sale.
Treatment of Claims
Under the Plan, these claims are unimpaired and will be paid in
full:
-- administrative expense claims;
-- reclamation claims;
-- postpetition administrative trade claims;
-- priority tax claims;
-- other priority claims; and
-- other secured claims.
Holders of prepetiton second lien secured lender claims, totaling
between $64,000 and $65,000, will be satisfied, if the proposed
purchaser became the prevailing bidder. If not, cash portion of
the purchase price allocable to outstanding allowed obligations
under the prepetition second lien secured loan under to the
prevailing bidder's assets purchase agreement and in accordance
with the requirements of the bidding procedures will be paid to
the agent under the prepetition second lien secured loan at the
closing of any sale approved by the Court.
General Unsecured claims, totaling between $71,000 and $1,100,000,
will be entitled to receive a pro rata share of the net assets of
the liquidation trust.
Holders of equity interests will not receive any distribution of
property and all equity interests will be cancelled on the
effective date of the Plan.
About Marcal Paper Mills
Based in Elmwood Park, New Jersey, Marcal Paper Mills Inc.
-- http://www.marcalpaper.com/-- is a privately-held, fourth
generation family business. Founded in 1932, it employs over 900
people in its Elmwood Park, New Jersey and Chicago, Illinois
manufacturing operations. The company produces over
160,000 tons of finished paper products, including bath tissue,
kitchen towels, napkins and facial tissue, distributed to retail
outlets for home consumption and to distributors for away-from-
home use in hotels, restaurants, hospitals, offices and factories.
The Debtor filed for chapter 11 protection on Nov. 30, 2006
(Bankr. D. N.J. Case No. 06-21886). Gerald H. Gline, Esq., and
Michael D. Sirota, Esq., at Cole, Schotz, Meisel, Forman &
Leonard P.A. represent the Debtor. The Debtor selected Logan and
Company Inc. as noticing and claims agent. Kenneth Rosen, Esq.,
and Mary E. Seymour, Esq., at Lowenstein Sandler PC represent the
Official Committee of Unsecured Creditors. In its schedules filed
with the Court, the Debtor disclosed total assets of $178,626,436
and total debts of $178,890,725.
MARCAL PAPER: Amended Plan Confirmation Hearing Set for Feb. 22
---------------------------------------------------------------
The Honorable Morris Stern of the United States Bankruptcy
Court for the New Jersey set Feb. 22, 2008, at 10:00 a.m., as the
hearing to consider approval of the adequacy of Marcal Paper Mills
Inc.'s Second Amended Disclosure Statement explaining its Second
Amended Chapter 11 Plan of Reorganization.
Objection to the Disclosure Statement approval must be filed on or
before Feb. 13, 2008.
Based in Elmwood Park, New Jersey, Marcal Paper Mills Inc.
-- http://www.marcalpaper.com/-- is a privately-held, fourth
generation family business. Founded in 1932, it employs over 900
people in its Elmwood Park, New Jersey and Chicago, Illinois
manufacturing operations. The company produces over
160,000 tons of finished paper products, including bath tissue,
kitchen towels, napkins and facial tissue, distributed to retail
outlets for home consumption and to distributors for away-from-
home use in hotels, restaurants, hospitals, offices and factories.
The Debtor filed for chapter 11 protection on Nov. 30, 2006
(Bankr. D. N.J. Case No. 06-21886). Gerald H. Gline, Esq., and
Michael D. Sirota, Esq., at Cole, Schotz, Meisel, Forman &
Leonard P.A. represent the Debtor. The Debtor selected Logan and
Company Inc. as noticing and claims agent. Kenneth Rosen, Esq.,
and Mary E. Seymour, Esq., at Lowenstein Sandler PC represent the
Official Committee of Unsecured Creditors. In its schedules filed
with the Court, the Debtor disclosed total assets of $178,626,436
and total debts of $178,890,725.
MARCAL PAPER: Court OKs $160 Mil. Assets Sale to NexBank SSB
------------------------------------------------------------
The U.S. Bankruptcy Court for the District of New Jersey has
approved the sale of substantially all of the Marcal Paper Mills
Inc.'s assets to an affiliate of NexBank SSB, as agent under the
second lien loan agreement, for the aggregate total consideration
of approximately $160 million.
Under the terms of the parties' asset purchase agreement, NexBank
will form Marcal Paper Mills Inc. LLC, as the purchaser and holder
of substantially all of the company's assets free and clear of any
interests, claims, encumbrances and liens.
The purchaser has reached agreement with the United Steel
Workers on a new collective bargaining agreement and has agreed to
pay all of the vendor's claims incurred during the bankruptcy
proceeding and honor all customer obligations.
The Court-approved sale enables Marcal to emerge from bankruptcy
as a new, vibrant, ongoing concern.
About Marcal Paper Mills
Based in Elmwood Park, New Jersey, Marcal Paper Mills Inc.
-- http://www.marcalpaper.com/-- is a privately-held, fourth
generation family business. Founded in 1932, it employs over 900
people in its Elmwood Park, New Jersey and Chicago, Illinois
manufacturing operations. The company produces over
160,000 tons of finished paper products, including bath tissue,
kitchen towels, napkins and facial tissue, distributed to retail
outlets for home consumption and to distributors for away-from-
home use in hotels, restaurants, hospitals, offices and factories.
The Debtor filed for chapter 11 protection on Nov. 30, 2006
(Bankr. D. N.J. Case No. 06-21886). Gerald H. Gline, Esq., and
Michael D. Sirota, Esq., at Cole, Schotz, Meisel, Forman &
Leonard P.A. represent the Debtor. Kenneth Rosen, Esq., and Mary
E. Seymour, Esq., at Lowenstein Sandler PC represent the Official
Committee of Unsecured Creditors. In its schedules filed with the
Court, the Debtor disclosed total assets of $178,626,436 and total
debts of $178,890,725
MARIFDARR INC: Case Summary & Seven Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Marifdarr, Inc.
dba Gold Inn
808 West Grantham Street
Goldsboro, NC 27530
Bankruptcy Case No.: 08-00339
Chapter 11 Petition Date: January 17, 2008
Court: Eastern District of North Carolina (Wilson)
Debtor's Counsel: Jason L. Hendren, Esq.
Brady, Nordgren, Morton & Malone, PLLC
2301 Sugar Bush Road, Suite 450
Raleigh, NC 27612
Tel: (919) 782-3500
Fax: (919) 573-1430
Total Assets: $1,963,770
Total Debts: $1,143,131
Debtor's list of its Seven Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
NC Department of Revenue Service Ad Valorem taxes $27,485
Attn: Managing Agent
2995 Radio Station Road
Greenville, NC 27834
Bank of America Trade debt $5,800
Attn: Managing Agent
P.O. Box 15710
Wilmington, DE 19886-5710
American Express Business Card Trade debt $5,596
Attn: Managing Agent
P.O. Box 1270
Newark, NJ 07101-1270
Citi Financial Retail Services Trade debt $2,850
AT&T Advertising $1,400
Internal Revenue Services Potential tax liability Unknown
NC Department of Revenue - NC Potential tax liability Unknown
MARK IV: Moody's Holds B3 Corp. Family Rating w/ Negative Outlook
-----------------------------------------------------------------
Moody's Investors Service confirmed the ratings of Mark IV
Industries:
-- Corporate Family, B3;
-- senior secured first lien facilities, B2; and
-- senior secured second lien term loan, Caa2.
The outlook is negative.
The ratings reflect Mark IV's successful amendment to its bank
credit facilities which provide, among other things, additional
covenant cushion over the remaining term of the credit facilities.
Subsequent to the amendment, Mark IV completed a transaction with
an affiliate of Sun Capital Partners (Sun Capital) whereby Sun
Capital purchased 100% of the equity ownership of Mark IV. In
connection with the transaction, the company used a combination of
equity contribution and cash on hand to pay down its term loans by
$75 million. While the transaction results in modest debt
reduction, this benefit is offset by increased interest costs
associated with the amendment. Moody's believes the B3 rating is
more consistent with the company's credit metrics, ongoing pricing
pressures in the company's transportation segment, production
pressures in the automotive segment, and the company's historical
underperformance to expectations. Sun Capital may provide a fresh
focus and some operational opportunities through leveraging the
affiliation with Sun Capital's other investments.
Mark IV is expected to have adequate liquidity, particularly given
its amended covenants, recently approved in connection with the
Sun Capital transaction. Free cash flow will be limited due to
the company's high interest costs, restructuring initiatives, and
ongoing pension funding requirements. As of Nov. 30, 2007, there
was approximately $46.8 million outstanding (including letters of
credit) under the $150 million revolving credit and $57 million of
cash on hand. The funded amount of the revolver is expected to
reduce to nominal amounts over the coming months, due to expected
working capital reductions and paydowns as part of the Sun Capital
transaction. Covenant level adjustments as part of the Sun
Capital transaction are expected to provide access to most of the
revolver over the near term. For the LTM period ended Nov. 30,
2007, the company's EBIT/interest coverage approximated 1.1x.
The negative outlook continues to reflect Moody's concern over
operating pressures faced by Mark IV over the near term. These
challenges include pricing pressures in the transportation
segment, the effectiveness of restructuring actions by Mark IV's
new owners, the timing of a recovery in the commercial vehicle
market, and ongoing operating pressures in the North American
automotive industry.
These ratings were confirmed:
Mark IV Industries, Inc.
-- B3 Corporate Family Rating;
-- B3 Probability of Default Rating;
Dayco Products, LLC
-- B2 (LGD3 33%) for the senior secured credit facilities to
consisting of:
- $150 million US/European revolving credit facility due
2010 (up to $50 million-equivalent to be available in
Euros); and a
- $654 million (remaining balance) 7-year US term loan B
due 2011;
-- Caa2 (LGD5, 86%) for the $150 million senior secured
second lien term loan due 2011;
Dayco Europe SrL
-- B2 (LGD3 33%) for the $48 million (remaining balance)
equivalent Euro denominated European term loan A due 2010.
The last rating action was on Dec. 11 , 2007 when the ratings were
lowered.
Future events that have the potential to drive Mark IV's outlook
or ratings higher include: consistent free cash flow generation,
reduced leverage resulting in EBIT/Interest coverage being
sustained at or above 1.2x or leverage approaching 5.5x.
Future events that have the potential to drive Mark IV's ratings
lower include: margin declines across the company's product
segments, and deterioration in liquidity. Consideration for a
lower rating could arise if any combination of these factors
results in leverage of approaching 7.0x or EBIT/ interest coverage
below 1.0x.
Mark IV Industries is a diversified manufacturer of engineered
systems and components utilizing radio frequency identification,
information display system, mechanical power transmission, air
admission, and other technologies that serve industrial,
transportation and automotive markets. Mark IV manages and
reports its operations into two categories:
Industrial/Distribution and Automotive OEM. Annual revenues
approximate $1.3 billion.
MBIA INSURANCE: Volatile Risks Prompt Moody's Rating Reviews
------------------------------------------------------------
Moody's Investors Service placed the Aaa insurance financial
strength ratings of MBIA Insurance Corporation and its affiliated
insurance operating companies on review for possible downgrade.
In the same rating action, Moody's also placed the surplus note
rating of MBIA Insurance Corporation (Aa2-rated) and the ratings
of the holding company, MBIA, Inc. (senior debt at Aa3), on review
for possible downgrade. This rating action reflects Moody's
growing concern about the potential volatility in ultimate
performance of mortgage and mortgage-related CDO risks, and the
corresponding implications for MBIA's risk-adjusted capital
adequacy. Prior to this rating action, the rating outlook for
MBIA was negative.
As a result of this review, the Moody's-rated securities that are
"wrapped" or guaranteed by MBIA are also placed under review for
possible downgrade, except those with higher public underlying
ratings.
According to Stanislas Rouyer, a Moody's Senior Vice President,
"The review of MBIA's ratings will reassess the firm's risk and
capital positions, in light of the prospect for worsening
performance in the mortgage market and the inherent volatility in
RMBS and ABS CDO exposures."
Moody's review will also consider the potential future demand for
financial guaranty insurance, not just in the structured finance
area where transaction volumes are expected to be depressed for
some time to come, but also in all other markets where the
guarantors are active.
These ratings have been placed on review for possible downgrade:
-- MBIA Insurance Corporation: insurance financial strength
at Aaa, and surplus notes at Aa2;
-- MBIA Insurance Corporation of Illinois: insurance
financial strength at Aaa;
-- Capital Markets Assurance Corporation: insurance financial
strength at Aaa;
-- MBIA UK Insurance Limited: insurance financial strength at
Aaa;
-- MBIA Assurance S.A.: insurance financial strength at Aaa;
-- MBIA Mexico S.A. de C.V.'s: insurance financial strength
at Aaa (the firm's Aaa.mx - national scale rating - is
affirmed);
-- MBIA Inc.: senior unsecured debt at Aa3, provisional
senior debt a (P) Aa3, subordinated debt at (P) A1, and
provisional preferred stock at (P) A2;
-- North Castle Custodial Trusts I-VIII: contingent capital
securities at Aa3;
The most recent rating action on MBIA occurred on Jan. 9, 2008,
when Moody's assigned a Aa2 rating to the $1 billion surplus note
issued by MBIA Insurance Corporation and downgraded the senior
unsecured ratings of parent company MBIA Inc. by one notch to Aa3.
Established in 1974, MBIA provides financial guarantees to issuers
in the municipal and structured finance markets in the United
States, as well as internationally. MBIA also offers various
complementary services, such as investment management and
municipal investment contracts.
MERITAGE HOMES: Moody's Downgrades Corp. Family Rating to B1
------------------------------------------------------------
Moody's lowered the ratings of Meritage Homes Corporation,
including its corporate family rating to B1 from Ba3, and its
senior unsecured notes rating to B1 from Ba3. The ratings outlook
is negative.
The downgrades were prompted by:
(i) the company's inability to turn cash flow positive on a
trailing twelve month basis through actual inventory reduction for
the trailing 12-month period ended Sept. 30, 2007;
(ii) Moody's expectation that covenant compliance will be
challenging and that the company may have to seek further relief
from its bank group in 2008; and
(iii) Moody's expectation that Meritage will generate pre-
impairment losses throughout 2008.
The ratings are supported by the longer-term strength of
Meritage's markets (Arizona, Texas, and California, Las Vegas,
Nevada and Florida), its relatively low owned land supply, and the
lack of any near-term debt maturities.
The negative outlook reflects Moody's expectation that Meritage's
credit metrics will continue to erode as the homebuilding industry
conditions are expected to be challenging throughout 2008, with
any recovery in 2009 likely to be sluggish.
Going forward, the ratings outlook could stabilize if the company
were to begin to generate substantial cash flow and use the cash
to augment liquidity and/or pay down debt.
The company's ratings could come under pressure if the company
were to have difficulty receiving further covenant relief, if
needed; if Moody's were to project the company to continue to
generate negative cash flow on a trailing twelve month basis
throughout 2008; or if debt leverage were to exceed 60% on a
sustained basis (as of Sept. 30, 2007, Meritage Homes' lease
adjusted debt leverage was approximately 53%).
These rating actions were taken:
-- Corporate family rating downgraded to B1 from Ba3;
-- Probability of default rating downgraded to B1 from Ba3;
-- Senior unsecured debt ratings downgraded to B1 (LGD4, 53%)
from Ba3 (LGD4, 53%).
Meritage Homes Corporation is the 13th largest homebuilder in the
U.S., primarily building attached and detached single-family homes
in 14 metropolitan areas in Arizona, Texas, California, Nevada,
Colorado, and Florida. Formerly known as Meritage Corporation,
the company was founded in 1985 and is headquartered in
Scottsdale, Arizona. Homebuilding revenues and consolidated net
income for the trailing twelve month period ended Sept. 30, 2007
were approximately $2.5 billion and ($151) million, respectively.
MERRILL LYNCH: Moody's Lowers Ratings on 19 Tranches
----------------------------------------------------
Moody's Investors Service downgraded the ratings of 19 tranches
and has placed under review for possible downgrade the ratings of
23 tranches from 4 deals issued by Merrill Lynch in 2007. The
collateral backing these classes consists of primariy first lien,
fixed and adjustable-rate, Alt-A mortgage loans.
The ratings were downgraded and placed under review for downgrade
based on higher than anticipated rates of delinquency,
foreclosure, and REO in the underlying collateral relative to
credit enhancement levels. In its re-rating, Moody's has also
applied its published methodology updates to the non delinquent
portion of the transactions.
Complete list of rating actions:
Issuer: Merrill Lynch Alternative Note Asset Trust, Series 2007-A1
-- Cl. A-1, Currently Aaa on review for possible downgrade,
-- Cl. A-2D, Currently Aaa on review for possible downgrade,
-- Cl. A-3, Currently Aaa on review for possible downgrade,
-- Cl. M-1, Currently Aa1 on review for possible downgrade,
-- Cl. M-2, Currently Aa2 on review for possible downgrade,
-- Cl. M-3, Currently Aa3 on review for possible downgrade,
-- Cl. M-4, Downgraded to Baa3, previously A1,
-- Cl. M-5, Downgraded to Ba2, previously A2,
-- Cl. M-6, Downgraded to Ba3, previously A3,
-- Cl. B-1, Downgraded to Caa1, previously Baa1,
-- Cl. B-2, Downgraded to Caa2, previously Baa2,
-- Cl. B-3, Downgraded to Ca, previously Baa3.
Issuer: Merrill Lynch Alternative Note Asset Trust, Series 2007-A2
-- Cl. A-1, Currently Aaa on review for possible downgrade,
-- Cl. A-2A, Currently Aaa on review for possible downgrade,
-- Cl. A-2B, Currently Aaa on review for possible downgrade,
-- Cl. A-3D, Currently Aaa on review for possible downgrade,
-- Cl. M-1, Currently Aa1 on review for possible downgrade,
-- Cl. M-2, Currently Aa2 on review for possible downgrade,
-- Cl. M-3, Currently Aa3 on review for possible downgrade,
-- Cl. M-4, Downgraded to Ba1, previously A1,
-- Cl. M-5, Downgraded to Ba3, previously A2,
-- Cl. M-6, Downgraded to B3 on review for possible further
downgrade, previously A3,
-- Cl. B-1, Downgraded to Caa1, previously Baa1,
-- Cl. B-2, Downgraded to Caa2, previously Baa2,
-- Cl. B-3, Downgraded to Ca, previously Baa3.
Issuer: Merrill Lynch Alternative Note Asset Trust, Series 2007-A3
-- Cl. A-1, Currently Aaa on review for possible downgrade,
-- Cl. A-2D, Currently Aaa on review for possible downgrade,
-- Cl. M-1, Currently Aa1 on review for possible downgrade,
-- Cl. M-2, Currently Aa1 on review for possible downgrade,
-- Cl. M-3, Currently Aa2 on review for possible downgrade,
-- Cl. M-4, Currently Aa3 on review for possible downgrade,
-- Cl. M-5, Downgraded to Ba2, previously A1,
-- Cl. M-6, Downgraded to B1, previously A2,
-- Cl. B-1, Downgraded to Caa2, previously Baa1,
-- Cl. B-2, Downgraded to Caa3, previously Baa1,
-- Cl. B-3, Downgraded to Ca, previously Baa3.
Issuer: Merrill Lynch Mortgage Investors Trust 2007-AF1
-- Cl. AV-2, Currently Aaa on review for possible downgrade,
-- Cl. MV-1, Currently Aa2 on review for possible downgrade,
-- Cl. MV-2, Downgraded to B1, previously A2,
-- Cl. MV-3, Downgraded to Caa2, previously Baa2,
-- Cl. 1AF-3, Currently Aaa on review for possible downgrade,
-- Cl. 1AF-9, Currently Aaa on review for possible downgrade.
MODERN TECH: Reports Strategies to Increase Shareholder Equity
--------------------------------------------------------------
Modern Technology Corp. disclosed its plan to increase shareholder
equity and create frequent dividends of both cash and stock.
During 2007, the company completed its planned divestiture of all
negative cash-flow operations and thereby eliminated the prior
levels of required cash to sustain these operations. The company
has re-aligned itself to require minimal cash and also position
itself to yield maximum cash for its stockholders.
For 2008, the company has embarked on a new strategy to achieve
its prior stated goals of stockholder equity appreciation and
dividends.
The new strategy requires a smaller operational footprint and less
cash to sustain operations and is anticipated to provide
a significantly higher internal rate of return for the company and
its stockholders.
The company will purchase 'bad debt' in the form of convertible
debentures from various institutional investors. These debt
instruments represent assets to the company and future cash-flows
from the sales of securities acquired from these convertible debt
instruments.
The company will also obtain a majority ownership position in the
debtor public company in order to execute a 'turn around' strategy
and subsequently execute a 'spin off' transaction and retain a
minority equity position.
This strategy is intended to create a continuously growing asset
base for the company well as cash-flows derived from both the sale
of stock obtained from the convertible debentures and the sale of
stock retained by the company as part of the spin-off transaction.
The company plans to execute two or more such transactions per
year. Each transaction may add $1 million to $5 million in asset
value to the company's balance sheet. As these convertible
debenture assets are liquidated, the cash yield is greater than
the value of the convertible debenture itself at 'face value'.
About Modern Technology Corp.
Headquartered in Oxford, Massachusetts, Modern Technology Corp.
(Pink Sheets: MODC)-- http://www.moderntechnologycorp.com/-- is a
diversified technology development and acquisition company that
builds revenues through continuous growth, strategic acquisitions,
and commercialization of nascent technology. MODC improves
operating efficiencies through the elimination of cost
redundancies and realized synergy between subsidiaries.
Going Concern Doubt
The company said it has doubts about its ability to continue as a
going concern considering its significant losses, negative cash
flows from operations, and accumulated deficits for the periods
ending March 31, 2007.
In addition, the company will need to fulfill working capital
requirements through the sale of stock and/or the issuance of
debt.
MQ ASSOCIATES: S&P Withdraws Ratings After Receipt of Consents
--------------------------------------------------------------
Standard & Poor's Ratings Services withdrawn its 'B-' issuer
credit rating on MQ Associates and 'CCC' rating on its
$136 million (face value at maturity) 12.25% senior discount notes
per the company's receipt of the requisite consents related to the
outstanding tender offer.
The 'B-' rating on wholly owned operating subsidiary MedQuest Inc.
and the 'CCC' subordinated debt remain on CreditWatch with
positive implications, where they were placed on Aug. 14, 2007,
after the company's agreement to merge with Novant Health, a not-
for-profit integrated health care system in North and South
Carolina; the transaction closed on Nov. 12, 2007.
On Jan. 15, 2008, MedQuest announced that it will redeem its $180
million 11.875% senior subordinated notes due 2012 for a cash
redemption price of 105.938% of the outstanding principal amount.
At Jan. 15, 2008, $177.2 million of notes were outstanding. If
successful, all ratings for MedQuest will be withdrawn. If the
debt remains outstanding, S&P will determine whether the credit
has improved as a result of new ownership.
Ratings List
MQ Associates Inc.
Ratings Withdrawn To From
-- ----
Corporate credit rating NR B-/Watch Pos/--
12.25% sr discount notes NR CCC/Watch Pos
NATIONAL COAL: Business Reasons Cue Moody's to Vacate Ratings
-------------------------------------------------------------
Moody's Investors Service has withdrawn all of its ratings for
National Coal Corporation, including the Ca (LGD4, 55%) rating on
National Coal's senior secured notes, as well as its Ca Corporate
Family Rating and SGL-4 Speculative Grade Liquidity rating. The
ratings were withdrawn for business reasons.
NEFF CORP: S&P Changes Outlook to Negative on Market Weakness
-------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on Neff
Corp. to negative from stable as a result of persistent weakness
in some of Neff's end markets that have been affected by the
residential housing slump.
Neff Corp. continues to carry Standard and Poor's long term
foreign and local issuer credit rating at 'B+'.
"With anemic prospects for residential housing in Neff's key
markets, particularly its home state of Florida and southern
California, the likelihood of reduced operating cash flow and the
inherent implications for not meeting expected leverage reduction
could lead to a downgrade in the near term," said
Standard & Poor's credit analyst John Sico. All ratings are
affirmed.
The ratings on Miami-based equipment rental company Neff Corp.
reflect the industry's highly competitive and cyclical nature as
well as Neff's aggressive financial policy. Private equity
sponsor Lightyear Capital LLC purchased Neff in a transaction
valued at about $900 million, excluding fees, in May 2007. Neff
operates mainly in the Sun Belt through 66 locations and
focuses on earth-moving equipment.
S&P could lower the ratings if leverage continues to be higher
than what S&P expect as weakness in Neff's end markets persists.
Neff operates in certain markets that have been affected by the
housing crisis. Furthermore, this may affect the light commercial
markets, erode EBITDA even more than expected, and delay any
reduction in leverage as the company enters a flat to declining
phase of the industry cycle. Additionally, the company would
also risk a negative rating action if it were to pursue a more
aggressive financial policy, specifically acquisitions or payment
of dividends.
NEPHROS INC: Notes Issuance Ups Stockholders' Equity to $10.2 Mil.
------------------------------------------------------------------
Nephros Inc. disclosed that as a result of the issuance of notes
in the third quarter of 2007, representing an aggregate principal
amount of $18 million, and the subsequent conversion of those
notes into equity on Nov. 14, 2007, the stockholders' equity of
the company increased to $10.2 million.
As a result, notwithstanding the company's anticipated loss during
the fourth quarter of 2007, the company's stockholders' equity, at
Dec. 31, 2007, is anticipated to be well in excess of the
$6 million required by the continued listing standards of the
American Stock Exchange.
Previously, the company was notified by the AMEX in July 2006 that
the company was not in compliance with the AMEX's continued
listing standards with respect to stockholders' equity. The AMEX
rules require that issuers with net losses in their five recent
fiscal years have stockholders' equity of at least $6 million.
The company incurred net losses in each of its five recent fiscal
years.
The company submitted a business plan in August 2006 to advise the
AMEX of the steps the company had taken, and planned to take, to
regain compliance with the applicable listing standards.
About Nephros Inc.
Headquartered in New York, Nephros Inc. (Amex: NEP) --
http://www.nephros.com/-- is a medical device company developing
and marketing products designed to improve the quality of life for
the End-Stage Renal Disease patient, while addressing the critical
financial and clinical needs of the care provider. Nephros also
markets a line of water filtration products, the Dual Stage
Ultrafilter. With an initial focus on health care, the DSU is in
a pilot-use program at a major U.S. medical center and has been
selected for further development by the U.S. Marine Corps.
Going Concern Doubt
Deloitte & Touche LLP expressed substantial doubt about Nephros
Inc.'s ability to continue as a going concern after auditing the
company's financial statements for the years ended Dec. 31, 2006,
and 2005. The auditing firm pointed to the company's recurring
losses and difficulty in generating sufficient cash flow to meet
its obligations and sustain its operations.
As reported in the Troubled Company Reporter on Dec. 11, 2007,
Nephros Inc.'s consolidated balance sheet at Sept. 30, 2007,
showed $14.2 million in total assets and $19.8 million in total
liabilities, resulting in a $5.6 million total shareholders'
deficit.
The company reported a net loss of $1.5 million for the third
quarter ended Sept. 30, 2007, compared with a net loss of
$1.9 million in the third quarter of 2006.
OCEANVIEW CBO: Poor Credit Quality Spurs Moody's Ratings Review
---------------------------------------------------------------
Moody's Investors Service placed these notes issued by Oceanview
CBO I, Ltd. on review for possible downgrade:
Class Description: Class A-1B Floating Rate Notes due June 2032
-- Prior Rating: Aaa
-- Current Rating: Aaa, on review for possible downgrade
Class Description: $12,500,000 Combination Securities
-- Prior Rating: Aaa
-- Current Rating: Aaa, on review for possible downgrade
In addition, Moody's also downgraded and left on review for
possible downgrade these notes:
Class Description: Class A-2 Floating Rate Notes due June 2037
-- Prior Rating: A3
-- Current Rating: Ba3, on review for possible downgrade
Moody's also downgraded these notes:
Class Description: Class B-F Fixed Rate Notes due June 2037
-- Prior Rating: Caa3
-- Current Rating: C
Class Description: Class B-V Floating Rate Notes due June 2037
-- Prior Rating: Caa3
-- Current Rating: C
According to Moody's, the rating actions are the result of
deterioration in the credit quality of the transaction's
underlying collateral pool, which consists primarily of structured
finance securities.
OVERSEAS SHIPHOLDING: Earns $26.6 Million in 2007 Third Quarter
---------------------------------------------------------------
Overseas Shipholding Group Inc. reported net income of
$26.6 million on shipping revenues of $277.2 million for third
quarter ended Sept. 30, 2007, versus net income of $90.8 million
on shipping revenues of $265.9 million in the comparable period in
2006. Net income in the current quarter benefited from a gain on
vessel sales and sale of securities of $1.5 million compared with
gains on vessel sales and sale of securities of $15.8 million in
the same period a year ago.
For the quarter ended Sept. 30, 2007, Time Charter Equivalent
revenues were $254.0 million, a slight decline from $254.8 million
for the same period of 2006. The decrease reflects a decline in
average daily TCE rates earned for VLCCs, Aframaxes and Handysize
Product Carriers. EBITDA for the quarter decreased 32% to
$92.8 million from $135.6 million in the comparable period of
2006.
Time charter equivalent revenues, which represents shipping
revenues less voyage expenses, is a non-GAAP measure used by the
shipping industy to compare revenue generated from a voyage
charter to revenue generated from a time charter.
For the first nine months ended Sept. 30, 2007, the company
reported a 5% increase in TCE revenues to $787.5 million from
$751.2 million in the comparable period of 2006. EBITDA for the
first nine months of 2007 decreased 9% to $387.4 million from
$424.8 million in the first nine months of 2006. Net income
declined 32% to $190.3 million for the first nine months of 2007
compared with $279.4 million in the comparable period of 2006.
The first nine months of 2007 benefited from gains on vessel sales
and sale of securities of $48.4 million, compared with
$21.1 million in the comparable period of 2006.
Morten Arntzen, president and chief executive officer of OSG
remarked, "During a challenging third quarter, we focused on
executing our balanced growth strategy. Notable achievements were
a 22% quarter-over-quarter rise of Product Carrier TCE revenues
resulting from the increase and diversification of ships in that
fleet and optimizing the mix of spot and time charters."
Income from vessel operations was $33.9 million in the third
quarter of 2007, a 62% decrease from $88.9 million in the same
period a year earlier. For the quarter ended Sept. 30, 2007,
total operating expenses increased 38%, or $66.4 million, to
$243.3 million from $176.9 million in the corresponding quarter in
2006. The increase in operating expenses was principally a result
of the inclusion of the Maritrans and the Heidmar Lightering
acquisitions and an increase in chartered-in tonnage. Total
operating expenses in the third quarter 2006 included
$27.0 million related to a reserve taken for the U.S. Department
of Justice investigation, which was settled on Dec. 19, 2006, and
paid in 2007.
Liquidity, including undrawn bank facilities, was more than
$1.6 billion. Total long-term debt as of Sept. 30, 2007, was
$1.7 billion compared with $1.3 billion at Dec. 31, 2006.
Balance Sheet
At Sept. 30, 2007, the company's consolidated balance sheet showed
$4.17 billion in total assets, $2.34 billion in total liabilities,
and $1.83 billion in total stockholders' equity.
Full-text copies of the company's consolidated financial
statements for the quarter ended Sept. 30, 2007, are available for
free at http://researcharchives.com/t/s?2720
About Overseas Shipholding
Overseas Shipholding Group Inc. (NYSE: OSG) -- http://www.osg.com/
-- is a tanker company that offers global energy transportation
services for crude oil and petroleum products in the U.S. and
International Flag markets. OSG is headquartered in New York
City.
As of Sept. 30, 2007, OSG's owned or operated fleet totaled 107
International Flag and U.S. Flag vessels compared with 91 at
Sept. 30, 2006. Fifty-three percent, or 57 vessels, were owned as
of Sept. 30, 2007, with the remaining vessels bareboat or time
chartered-in. OSG's newbuild program of chartered-in and owned
vessels totaled 42 and spanned all lines of business.
* * *
As reported in the Troubled Company Reporter on Nov. 2, 2007,
Standard & Poor's Ratings Services placed its ratings, including
its 'BB+' corporate credit rating, on Overseas Shipholding Group
Inc. on CreditWatch with negative implications.
OVERSEAS SHIPHOLDING: S&P Chips Rating to 'BB' on Weak Profile
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Overseas Shipholding Group Inc. to 'BB' from 'BB+'. At
the same time, S&P lowered the senior unsecured debt
ratings to 'BB', the same as the new corporate credit rating, from
'BB+'. All ratings were removed from CreditWatch, where they were
placed with negative implications on Oct. 31, 2007. The outlook
is now stable.
"The downgrade reflects the company's weakened financial profile
following acquisitions, share buybacks, higher dividends, and
recently reduced earnings," said Standard & Poor's credit analyst
Funmi Afonja. Positive credit factors include satisfactory
liquidity and a well-established market position in the ocean
transportation of crude oil and petroleum products.
The New York City-based shipping company had about $3.3 billion of
lease-adjusted debt outstanding at Sept. 30, 2007. OSG's financial
profile has deteriorated over the past year. Adjusted (for
operating leases) Sept. 30, 2007, trailing 12-month EBITDA
interest coverage weakened to 2.9x from 5.0x in the year-earlier
period. At the same time, net (of $542 million in cash) debt to
EBITDA weakened to about 5x from 3x in the prior-year period. The
weakening credit metrics over the past year were the result of the
company's financial choices, which resulted in material increases
in debt. Its Sept. 30, 2007, net debt to capital increased to
about 53% from 40% a year earlier. Ratings incorporate an
expectation that leverage will likely stay at elevated levels,
with some fluctuation, over the next couple of years, depending on
the timing of significant capital outlays related to the new
vessel deliveries.
OSG's well-established market position in the ocean transportation
of crude oil and petroleum products should help the company
maintain a credit profile consistent with the rating. An outlook
revision to negative, while not anticipated, is possible if tanker
rates drop significantly and for a sustained period, resulting in
meaningful deterioration in the company's cash generation and
financial profile, or if the company adopts a more aggressive
financial policy. S&P considers an outlook revision to positive
less likely.
PARMALAT SPA: Creditors Convert Warrants for 61,626 Shares
----------------------------------------------------------
Parmalat S.p.A. communicates that, following the allocation of
shares to creditors of the Parmalat Group, the subscribed and
fully paid up share capital has now been increased by 301,768
euros to 1,652,419,845 euros from 1,652,118,077 euros. The share
capital increase is due to the exercise of 61,626 warrants and to
the assignation of 240,142 shares.
[The latest status of the share allotment is]:
* Number 33,811,508 shares representing approximately 2.0%
of the share capital are still in a deposit account c/o
Parmalat S.p.A., of which:
-- 13,476,689 or 0.8% of the share capital, registered in
the name of individually identified commercial
creditors, are still deposited in the intermediary
account of Parmalat S.p.A. centrally managed by Monte
Titoli (compared with 13,481,713 shares as at
November 27, 2007);
-- 20,454,819 or 1.2% of the share capital registered in
the name of the Foundation, called Fondazione Creditori
Parmalat, of which:
(i) 120,000 shares representing the initial share
capital of Parmalat S.p.A. (unchanged);
(ii) 20,334,819 or 1.2% of the share capital that
pertain to currently undisclosed creditors
(compared with 20,585,048 shares as at
November 27, 2007).
About Parmalat S.p.A.
Headquartered 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
for bankruptcy protection, they reported more than $200 million in
assets and debts. The U.S. Debtors emerged from bankruptcy on
April 13, 2005.
Parmalat 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. On June 21, 2007, the U.S. Court Granted
Parmalat Permanent Injunction.
(Parmalat Bankruptcy News, Issue No. 96; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).
PARMALAT SPA: Reaches EUR310,000,000 Settlement Pact with Intesa
----------------------------------------------------------------
Parmalat S.p.A. and Intesa Sanpaolo S.p.A. communicate that
agreement has been reached which settles all reciprocal claims
that led to litigation arising from operations in the period
preceding the insolvency declaration of the Parmalat Group. The
settlement brings all pending revocatory and damages actions and
all reciprocal claims eventually to be filed to an end. Intesa
Sanpaolo Group will pay a total amount of EUR310,000,000.
Furthermore, Parmalat S.p.A. communicates that an agreement has
been reached with Cassa di Risparmio di Parma e Piacenza S.p.A.
which settles all reciprocal claims with the companies under
extraordinary administration procedures and Parmalat on one hand,
and Cariparma on the other hand, with withdrawal of all pending or
possible revocatory and damages actions with payment by Cariparma
of a total amount of EUR83,000,000.
Within the same framework an agreement has been reached for the
settlement of the revocatory actions against Biverbanca S.p.A.,
with withdrawal of all actions and payment of a total amount of
EUR3,000,000.
Similar settlements have been reached between the Intesa Sanpaolo
Group and Cariparma on one side and the Commissioner of the
Extraordinary Administration of the Parmatour Group and of Parma
Associazione Calcio and of the other companies of the former
Parmalat Group still in Extraordinary Administration on the other
side. These agreements establish the withdrawal of all the
pending and potential actions by the Extraordinary Commissioner
and:
* The payment by the Intesa Sanpaolo Group of an amount of
EUR12,500,000 to the Parmatour Group under Extraordinary
Administration and the payment of an amount of
EUR2,500,000 to Parma Associazione Calcio under
Extraordinary Administration and the payment of a total
amount of EUR2,000,000 to the other companies under
Extraordinary Administration;
* The payment by Cariparma of an amount of EUR2,500,000 to
the Parmatour Group under Extraordinary Administration and
the payment of an amount of EUR2,500,000 to Parma
Associazione Calcio under Extraordinary Administration and
the payment of a total amount of EUR2,000,000 to the other
companies under Extraordinary Administration;
Parmalat and Intesa Sanpaolo and the Extraordinary Commissioner
express their satisfaction on the settlement.
About Parmalat S.p.A.
Headquartered 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
for bankruptcy protection, they reported more than $200 million in
assets and debts. The U.S. Debtors emerged from bankruptcy on
April 13, 2005.
Parmalat 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. On June 21, 2007, the U.S. Court Granted
Parmalat Permanent Injunction.
(Parmalat Bankruptcy News, Issue No. 96; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).
PATRICIA BARNES: Case Summary & Two Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Patricia Barnes
950 Mason Street, Apartment 214
San Francisco, CA 94108
Tel:(209) 482-7498
Bankruptcy Case No.: 08-30065
Chapter 11 Petition Date: January 16, 2008
Court: Northern District of California (San Francisco)
Judge: Thomas E. Carlson
Debtor's Counsel: K. Keith McAllister, Esq.
Law Offices of K. Keith McAllister
P.O. Box 864
Tiburon, CA 94920
Tel: (415)435-2338
Estimated Assets: $1 Million to $10 Million
Estimated Debts: $1 Million to $10 Million
Debtor's list of its Two Largest Unsecured Creditors:
Entity Claim Amount
------ ------------
Braaksma Construction $600,060
1140 Centre Drive, Unit W
City of Industry, CA 91789
BMC West Corporation $101,361
4237 Murphy Road
Medesto, CA 95358
PLASTECH ENGINEERED: S&P Chips Rating to B- on Tight Liquidity
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on
privately held Plastech Engineered Products Inc., including the
corporate credit rating, which was lowered to 'B-' from 'B+'.
The ratings remain on CreditWatch with negative implications,
where they were placed on Dec. 6, 2007.
"The downgrade reflects the company's very tight liquidity and our
expectation that its credit protection measures will remain under
pressure in the near term because of weak production volumes,
adverse product mix, and challenges in reducing costs," said
Standard & Poor's credit analyst Nancy Messer.
Total balance-sheet debt was $488 million at Sept. 30, 2007.
Dearborn, Michigan-based Plastech is a manufacturer of automotive
parts, primarily injection-molded plastic components for vehicle
interiors.
S&P will closely monitor the situation, and S&P expects to resolve
the CreditWatch listing after evaluating actions that management
may undertake to bolster liquidity. S&P could lower the ratings
further if S&P concludes that near-term liquidity will become
further constrained.
PROPEX INC: Files Chapter 11 Protection; To Continue Operations
---------------------------------------------------------------
Propex Inc. said Friday that it has filed for protection under
Chapter 11 of the U.S. Bankruptcy Code in order to right-size its
balance sheet. The company will continue to operate its
facilities and offices in the ordinary course of business while it
restructures. Additionally, Propex has arranged a $60 million
credit facility for which it will be seeking Court approval. This
will provide the company with immediate and sufficient liquidity
to operate its business on an ongoing basis.
The company also filed for Bankruptcy Court approval of various
First-Day Motions designed to ensure continuation of its ordinary
business operations. Specifically, Propex requested and expects
that the Court will approve the company's new financing to
continue all operations in the normal course, including
maintaining payroll and employee benefits; all deliveries to
customers; and fulfillment of obligations to critical suppliers.
The company anticipates its First-Day Motions to be approved in
the coming days.
"Today's steps are part of an important process to strengthen
Propex," said Joe Dana, President of Propex Inc. "We believe the
financial reorganization will allow us to implement a
restructuring plan that will lower our debt levels and expand our
market leadership in key sectors from a position of financial
strength."
The new financing will provide $60 million in immediate liquidity.
With this cash infusion, the company can focus on servicing its
customers and improving operations. Upon completion, the Chapter
11 restructuring is expected to reduce debt and create additional
cash flow that otherwise would be earmarked for debt service.
"During the past year, our entire industry has been hit hard by
the general economic decline led by the deteriorating housing
market plus the escalating cost of raw materials. I am pleased we
now have a way forward and appreciate the support of our valued
customers, suppliers, lenders and employees," said Mr. Dana.
The filing impacts Propex's U.S. operations only and does not
impact the company's Latin American and European operations.
The company will provide updates regarding ongoing operations
plans as they become available.
Covenant Default
As reported in the Troubled Company Reporter on Jan.10, 2008,
Propex, at Sept. 30, 2007, said it was not in compliance with the
two leverage ratio covenants under the Second Amendment to a
Credit Agreement dated Jan. 26, 2007. The company is currently in
default under the Credit Agreement and in negotiations with its
lenders in order to resolve the issue of non-compliance. As of
Sept. 30, 2007, the company had $230.6 million of borrowings
outstanding under the Credit Agreement.
About Propex Inc.
Propex Inc. -- http://www.propexinc.com/-- manufactures primary
and secondary carpet backing. The company also manufactures and
markets woven and non-woven polypropylene fabrics and fibers used
in geosynthetic and a variety of other industrial applications.
The company disclosed a net loss of $60.7 million in three months
ended Sept. 30, 2007, compared to a net loss of $6.5 million in
the same period in 2006. At Sept. 30, 2007, the company's balance
sheet showed total assets of $585.7 million and total liabilities
of $527.4 million, resulting in a $58.3 million stockholders'
equity.
* * *
As reported in the Troubled Company Reporter on Jan. 16, 2008,
Moody's Investors Service downgraded its debt ratings of Propex,
Inc.: corporate family and probability of default, each to Caa2
from Caa1, senior secured first lien to B3 from B2 and senior
unsecured to Caa3 from Caa2. Moody's also placed these ratings on
review for further downgrade because of the continuing non-
compliance with the leverage covenants of the senior secured bank
credit facility and the uncertainty of how Propex will resolve
this Event of Default under the Credit Agreement. The speculative
grade liquidity rating is unchanged at SGL-4.
PROPEX INC: Case Summary & 30 Largest Unsecured Creditors
---------------------------------------------------------
Lead Debtor: Propex, Inc.
6025 Lee Highway, Suite 425
Chattanooga, TN 37421
aka Propex Fabrics, Inc.
aka Propex Geosolutions Corporation
aka SI Geosolutions Exchange, L.L.C.
aka SI Concrete Exchange, L.L.C.
aka SI Concrete Holdings, L.L.C.
Bankruptcy Case No.: 08-10249
Debtor-affiliates filing separate Chapter 11 petitions:
Entity Case No.
------ --------
Propex Holdings, Inc. 08-10250
Propex Concrete Systems Corp. 08-10252
Propex Fabrics International Holdings I, 08-10253
Inc.
Propex Fabrics International Holdings II, 08-10254
Inc.
Type of Business: The Debtor produces geosynthetic, concrete,
furnishing and industrial fabrics and fiber. It
creator the following brands: Pyramat,
Actionbac, Fibermesh, Duon and CURV. See
http://www.propexinc.com/
Chapter 11 Petition Date: January 18, 2008
Court: Eastern District of Tennessee (Chattanooga)
Judge: John C. Cook
Debtor's Counsel: Edward L. Ripley, Esq.
Henry J. Kaim, Esq.
Mark W. Wege, Esq.
King & Spalding
1100 Louisiana, Suite 4000
Houston, TX 77002
Tel: (713) 751-3200
--and--
Shelley D. Rucker, Esq.
Miller & Martin, L.L.P.
Volunteer Building, Suite 1000
832 Georgia Avenue
Chattanooga, TN 37402-2289
Tel: (423) 756-6600
Consolidated Financial Condition as September 30, 2007:
Total Assets: $585,700,000
Total Debts: $527,400,000
Consolidated List of Debtors' 30 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
B.P. Amoco Chemical Holding note $31,258,333
Co.
Attention: Mike Kapelinski
4010 Winfield Road
Warrenville, IL 60666
Tel: (630) 821-3130
S.S.B.&T. Co. bond holder $30,294,000
Attention: Paul Desharnais
1776 Heritage Drive
North Quincy, MA 02171
Tel: (617) 985-2880
Fax: (617) 537-6608
Bear Stearn bond holder $23,916,000
Attention: Vincent Marzella
One Metrotech Center North,
4th Floor
Brooklyn, NY 11201-3862
Morgan Stanley bond holder $13,500,000
Attention: Michelle Ford
901 South Bond Street,
6th Floor
Baltimore, MD 21231
Tel: (410) 563-7074
Fax: (410) 534-1420
First Clear bond holder $10,349,000
Attention: Heidi Richnafsky
10700 Wheat First Drive,
Suite WS 1023
Glen Allen, VA 23060
Tel: (804) 398-4931
Raymond bond holder $8,072,000
Attention: Mike Dillard
880 Carilion Parkway
P.O. Box 12749
St. Petersberg, FL 33716
Tel: (727) 567-3206
Fax: (727) 567-8837
J.P. Morgan Chase Bank, N.A. bond holder $7,848,000
Attention: Sanjay Ghuliani
Wing B, Mindspace, Malad West
Floor 6
Mumbai, India 400 064
Tel: (469) 477-2140
Fax: (912) 2665069745
Mitsub U.F.J. bond holder $7,450,000
Attention: Richard Wenshoski
420 Fifth Avenue, 6th Floor
New York, NY 10018
Tel: (212) 307-3461
Northern Trust bond holder $5,900,000
Attention: Robert Valentin
801 South Canal Street
Chicago, IL 60607
Tel: (312) 557-8666
Goldman bond holder $5,870,000
Attention: Gloria
30 Hudson Street
Jersey City, NJ 07302
Tel: (212) 902-1973
Fax: (212) 428-1521
Nat City B bond holder $5,842,000
Attention: Halle Staskey
4100 West 150th Street
Cleveland, OH 44135
Tel: (216) 257-4546
Fax: (216) 257-5941
Pershing Securities Corp. bond holder $5,051,000
Attention: Al Hernandez
1 Pershing Plaza
Jersey City, NJ 07399
Tel: (201) 413-3090
Fax: (201) 413-5263
Bank of New York bond holder $4,786,000
Attention: Mitchel Sobel
One Wall Street, 6th Floor
New York, NY 10286
Tel: (212) 635-6206
Fax: (212) 635-6224
Total Petrochemicals, Inc. trade debt $3,552,739
Atlanta, GA 31193-2437
Tel: (972) 801-2616
Fax: (713) 483-5291
Charles Schwab bond holder $3,585,000
Attention: Ronnie Fuiava
211 Main Street
San Francisco, CA 94105
Tel: (631) 254-7618
Fax: (631) 254-7400
Wells Bank, N.A. bond holder $2,118,000
Attention: Lacey Peterson
733 Marquette Avenue, M.A.C.
N9306-057 5th Floor
Minneapolis, MN 55479
Tel: (612) 316-3447
Fax: (612) 667-1947
Wells, L.L.C. bond holder $2,073,000
Attention: Margaret Klasen
625 Marquette Avenue,
13th Floor
Minneapolis, MN 55402-2308
Tel: (612) 336-7994
Fax: (612) 336-7814
N.F.S., L.L.C. bond holder $1,979,000
Attention: Lou Trezza
200 Liberty Street
New York, NY 10281
Tel: (212) 335-5807
Fax: (508) 624-5114
Brown Brothers bond holder $1,400,000
Attention: Jennifer Payea
525 Washington Boulevard
Jersey City, NJ 07302
Tel: (201) 418-5877
G.S.E. Lining Technology, Inc. trade debt $1,368,548
19103 Gundle Road
Houston, TX 77073
Tel: (281) 443-8564
Fax: (281) 230-8663
Superior Yarn Technology trade debt $1,336,178
400 Cross Plains Industrial
Boulevard
Dalton, GA 30719
Tel: (706) 272-7286
Fax: (706) 272-0492
Sterne, A.G. bond holder $1,316,000
Attention: Maribeth Williams
813 Shades Creek Parkway,
Suite 100-B
Birmingham, AL 35242
Tel: (205) 414-3205
Fax: (205) 414-7237
Wells Fargo bond holder $1,250,000
Attention: Patrick Giardano
1445 Ross Avenue, 2nd Floor
Dallas, TX 75202
Tel: (214) 740-1573
Fax: (214) 777-4086
Custodial Trustee bond holder $1,094,000
Attention: Dawn Elke
101 Carnegie Center
Princeton, NJ 08540
Tel: (609) 951-2321
Fax: (609) 951-2327
5th-3rd Bank bond holder $1,000,000
Attention: Lance Wells
5001 Kingsley Drive
Mail Drop 1MOB2D
Cincinnati, OH 45227
Tel: (513) 358-9798
Fax: (513) 358-8637
Citibank bond holder $905,000
Attention: Carolyn Trebus
3800 Citibank Center B3-12
Tampa, FL 33610
Tel: (813) 604-1130
Fax: (813) 604-1966
Techmer, P.M., L.L.C. $789,276
P.O. Box 535064
Atlanta, GA 30353-5064
Tel: (865) 457-6700
Fax: (865) 457-5227
Fibervisions bond holder $738,655
Department at 40206
Atlanta, GA 31192-0206
Fax: (770) 784-7137
Naue G.M.B.H. & Co. K.G. $197,226
Gewerbestrasse 2
32339 Espelkamp-Fiestel
Tel: 49 (0) 57 43 / 41-0
Fax: 49 (0) 57 43 / 41-240
Monahan S.F.I., L.L.C. $163,112
P.O. Box 250
Arcola, IL 61910
PROSPECT MEDICAL: S&P Cuts Rating to B- on Adverse Development
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered its counterparty credit
rating on Prospect Medical Holdings Inc. to 'B-' from 'B+' and
placed it on CreditWatch with negative implications.
"We took this rating action because of Prospect Medical's adverse
business development," explained Standard & Poor's credit analyst
Joseph Marinucci. "The company's fiscal-year 2007 pro forma cash
flow will likely be materially lower than it had planned because
of lower revenue stemming from member attrition, a higher claim
trend due to increased utilization of specialty services, and
modestly higher administrative expenses."
S&P attributes the shortfall to margin compression in Prospect's
core business lines. S&P further believes that margin pressure is
likely to persist into the first quarter of 2008. In addition,
Prospect Holdings has delayed the filing of its 10-K for fiscal
2007 in connection with a review and potential restatement of
financial results for Alta Healthcare System, which it acquired in
August 2007.
In connection with these developments, S&P believes the company
could breach its financial covenants, which in turn could result
in the immediate termination of its $10 million revolver and cause
its credit agreement loan balance (about $150 million as of
Sept. 30, 2007) to become payable immediately. This would create
a significant liquidity problem for the company if the lending
group does not elect to waive its enforcement rights.
Standard & Poor's expects to conduct follow-up discussions with
Prospect's management team during the first quarter of 2008 in
connection with the above referenced. Thereafter, S&P could
affirm the rating or lower by one or more notches, and S&P could
assign a stable or negative outlook.
RADIANT ENERGY: Inks Debt-to-Equity Swap With Two Companies
-----------------------------------------------------------
Radiant Energy Corporation has entered into Creditor Settlement
Agreements with 954740 Ontario Limited and with Hara Enterprises
Limited for the settlement of certain short-term and secured loans
with an aggregate principal balance of $2,445,000 and the
forgiveness of accrued interest equal to $344,692 in return for
18,111,111 common shares of the company. The completion of the
settlement of these loans is conditional on acceptance of the TSX
Venture Exchange.
954740 Ontario Limited is a corporation controlled by John Marsh,
an insider to the company, and Hara Enterprises Limited is a
corporation control by Gregory O'Hara, an insider to the company.
Over the past eighteen months the company's financial goal has
been to reduce debt. From June 2006 to the present and prior to
theses transaction, the consolidated debt decreased from
$17 million to $9.2 million.
The settlement of the loans between Radiant and it's subsidiaries
is a significant step in accomplishing the company's financial
goals. The company anticipates closing this transaction
immediately after receipt of the acceptance of the TSX Venture
Exchange which is expected by Jan. 31, 2008.
Settlement of Short-term Loans
The aggregate principal amount of the Short-term Loans between REC
and 954740 and Hara is $445,000 and the accrued interest is
$49,598. Each of 954740 and Hara has signed Creditor Settlement
Agreements to settle the principal amount of the debt for the
issuance of 3,296,296 common shares, representing $0.135 per
common share. Each of 954740 and Hara has also agreed to forgive
payment of the accrued interest.
Settlement of the Secured Loans with RAS Europe
The aggregate principal amount of the Secured Loans between RAS
Europe, a subsidiary of REC, and 954740 and Hara is $2,000,000 and
the accrued interest is $295,094. Each of 954740 and Hara has
signed Creditor Settlement Agreements to settle the principal
amount of debt for the issuance of 14,814,815 common shares,
representing $0.135 per common share. The two creditors also
agreed to forgive payment of the accrued interest.
Related Party Transactions
Each of John Marsh and Gregory O'Hara are insiders of the company
under Canadian securities laws and the settlement of the debt for
shares is considered to be a related partly transaction under
Canadian securities laws. The company has determined that it is
exempt under the Ontario Securities Commission Rule 61-501 from
the requirements to obtain a formal valuation and minority
approval for this settlement of debt.
Upon completion of the settlement of the debt for shares of the
company, John Marsh and Gregory O'Hara will beneficially own and
control 41,723,973 shares of the company, representing 24.3% and
30,102,334 shares of the company, representing 19%, of the issued
and outstanding shares of the company, including convertible
securities.
The board of directors first determined that all three members of
the board are independent of the transaction. The board reviewed
recent market prices for Radiant shares and determined that the
effective conversion price taking into account the forgiveness of
accrued interest was approximately $0.155 per share, representing
a 3.3% premium to the closing price of the common shares on
Jan. 14, 2008, the day prior to the execution of the Creditor
Settlement Agreements.
The board unanimously approved the settlement of the debt for
shares of the company. The board considered the significant
reduction of debt the transactions represent, the improvement of
the financial condition of the company and the corresponding
decrease in the shareholders' deficit and concluded the
transaction to be fair for all shareholders and in the best
interests of the company.
About Radiant Energy
Based in Port Colborne, Ontario, Radiant Energy Corp. (TSX: RDT) -
- http://www.radiantenergycorp.com/-- through its wholly owned
subsidiary Radiant Aviation Services developed and sells the only
infrared alternative to traditional glycol-based aircraft deicing.
Its fully patented InfraTek(R) systems are approved for use by the
FAA. Before the introduction of InfraTek, spraying with glycol
was the only feasible method to satisfy FAA safety guidelines for
ensuring that aircraft are properly deiced before take-off.
At July 31, 2007, the company's balance sheet showed total assets
of $2.64 million, and total liabilities of $9.55 million,
resulting to a shareholders' deficit of $6.90 million.
RITCHIE CAPITAL: Court OKs Sale of Two Ireland Units for $452.5MM
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
approved a sale of the assets of Ritchie Capital Management
Ltd.'s bankrupt units, Ritchie Risk-Linked Strategies Trading
(Ireland) Ltd. and Ritchie Risk-Linked Strategies Trading
(Ireland) II, Ltd., various reports say.
Nutmeg Life Settlement Trust, an affiliate of Bear Stearns Co.
will buy 182 polices from the Debtors for $56.5 million while ABN
Amro NV will buy 891 policies for $396 million, a total of
$452.5 million, reports relate, citing Bradley Geer at Houlihan
Lockey Howard & Zukin, which marketed the life insurance assets.
In addition, the Court also gave Ritchie Ireland I and II
additional three months or until April 15, 2008, to file their
plan of liquidation, reports reveal.
About Ritchie Risk-Linked
Based in Dublin, Ireland, Ritchie Risk-Linked Strategies Trading
(Ireland) Ltd. and Ritchie Risk-Linked Strategies Trading
(Ireland) II Ltd. -- http://www.ritchiecapital.com/-- are Dublin-
based funds of hedge fund group Ritchie Capital Management. The
Debtors were formed as special purpose vehicles to invest in life
insurance policies in the life settlement market.
The Debtors filed for Chapter 11 protection on June 20, 2007
(Bankr. S.D.N.Y. Case Nos. 07-11906 and 07-11907). Allison H.
Weiss, Esq., David D. Cleary, Esq., and Lewis S. Rosenbloom, Esq.,
at LeBoeuf, Lamb, Greene & MacRae, LLP represent the Debtors in
their restructuring efforts. No Official Committee of Unsecured
Creditors has been appointed to date. When the Debtors filed for
bankruptcy, they listed estimated assets and debts of more than
$100 million. The Debtors' exclusive period to file a Chapter 11
plan expires on April 15, 2008.
About Ritchie Capital
Headquartered in Lisle, Illinois, Ritchie Capital Management
Ltd. - http://www.ritchiecapital.com/-- is a private asset
management firm founded in 1997 by former college football
linebacker Thane Ritchie. The company has offices in New York
and Menlo Park, California.
ROLAND ROAD: Voluntary Chapter 11 Case Summary
----------------------------------------------
Debtor: Roland Road Properties, L.L.C.
P.O. Box 1988
Cordova, TN 38088-1988
Bankruptcy Case No.: 08-20580
Chapter 11 Petition Date: January 17, 2008
Court: Western District of Tennessee (Memphis)
Judge: Jennie D. Latta
Debtor's Counsel: John E. Dunlap, Esq.
1433 Poplar Avenue
Memphis, TN 38104
Tel: (901) 276-3334
Total Assets: $3,600,000
Total Debts: $1,381,634
The Debtor does not have any creditors who are not insiders.
SCAN INTERNATIONAL: Wells Fargo DIP Pact Gets Interim Court Okay
----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Maryland gave
interim authority to S.C.A.N. International Inc. to obtain debtor-
in-possession financing from Wells Fargo Business Credit through
their pre-bankruptcy financing agreement.
Pursuant to a credit and security agreement between the Debtor and
Wells Fargo, the Debtor granted the lender a first lien and
security interest in its assets, which assets consist primarily of
furniture inventory. Under the agreement, Wells Fargo made cash
advances to the Debtor for use in the Debtor's business operations
based upon the value of the Debtor's inventory.
The prepetition financing agreements provide the Debtor with a
revolving line of credit based upon the Debtor's eligible
inventory and subject to certain formulas, with a maximum
borrowing authority of $4,000,000. Prior to bankruptcy filing,
the Debtor was authorized to borrow approximately 52.8% of the
cost of its unsold inventory, and 72% of the cost of inventory
which had been sold but not yet delivered to the customer, less a
reserve of 67% of deposits received from customers for merchandise
which has not yet been delivered to the customer. Under this
scheme, the Debtor owed Wells Fargo approximately $920,000 under
the agreement.
Wells Fargo has agreed to waive the customer deposit reserve
requirement under the agreement, which will result in the Debtor
initially having borrowing availability of approximately
$1,700,000, enabling the Debtor to borrow an additional
approximately $750,000. Upon commencement of the financing, Wells
Fargo will receive a facility fee of 5% or $50,000. Additionally,
the Debtor's borrowings will bear interest at the prime rate plus
5%.
The Debtor says that the financing arrangement will provide it
with working capital to fund its operations and prevent
irreparable harm to its business.
Based in Columbia, Maryland, S.C.A.N. International Inc. aka
S.C.A.N. Contemporary Furniture -- http://www.scanfurniture.com/-
- sells furniture. It filed for Chapter 11 protection on
Dec. 26, 2007 (Bankr. D. M.D. Case No. 07-23153). Stephen F.
Fruin, Esq., at Whiteford, Taylor & Preston LLP, represents the
Debtor in its restructuring efforts. An Official Committee of
Unsecured Creditors has been appointed in the Debtor's case. When
the Debtor filed for protection from its creditors, it listed
estimated assets and debts between $1 million and $100 million.
SNOHOMISH COUNTY: S&P Cuts Rating on $14MM Revenue Bonds to BB+
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating to 'BB+'
from 'BBB-' on Snohomish County Public Hospital District No. 2,
Washington's $14 million hospital revenue bonds, issued for
Stevens Healthcare. Although Stevens has demonstrated operational
improvement in fiscal 2006 (year end Dec. 31) and for the 10
months ended Oct. 31, 2007, Stevens' balance sheet continues to
reflect low liquidity and high leverage despite low levels of
capital spent on maintenance and improvement of plant and
equipment which raised average age of plant to a high 13 years.
While Stevens benefits from ongoing tax support from Snohomish
County ('AA' GO rating) and a diminishing level of revenue debt,
there is very little flexibility without issuing either more
revenue or tax-supported debt. Maximum annual debt service
coverage on the non-tax-supported debt is already low. The
outlook is stable.
"While management has reduced operating losses, the district has
limited cash reserves and high leverage that leaves little room
for more revenue debt," said Standard & Poor's credit analyst
Keith Dickinson. "The average age of plant continues to climb and
stands at 13.4 years, and low levels of capital expenditures have
been a constant issue, reaching only 41% of depreciation in fiscal
2006."
In fiscal 2006, the net operating loss decreased to $3.8 million
from $5.8 million for fiscal 2005. For the unaudited 10 months of
fiscal 2007, operating losses stood at $2.9 million. The improved
operations are the result of a turnaround plan concluded in 2006
that focused on revenue cycle improvements, productivity
management, and non-labor cost reduction, among other items.
Unrestricted cash and investments increased to $14.3 million at
year-end 2006, up from $11.7 million at year-end 2005, but
returned to just $11.8 million for the 10-month interim period.
As a result, Steven's cash-to-revenue debt ratio for the year to
date is 80.7%, down from 137.1% at 2006. Days' cash on hand
remains weak at 29 and 37 days, respectively, for the interim
period and fiscal 2006, despite very limited capital spending over
the past three years. Capital expenditures have averaged only 44%
of depreciation expense over the past three fiscal years. MADS
coverage, calculated for the series 1995 revenue debt and capital
leases (excluding the GO and limited-tax GO debt service and
interest expense, along with the GO and limited-tax GO tax
levies), was low at 1.5x in fiscal 2006 and the interim period,
improved however from 0.9x in fiscal 2005.
Stevens Healthcare is a Washington municipal corporation, Public
Hospital District No. 2 of Snohomish County, that operates a 156-
staffed-bed hospital in Edmonds, 14 miles north of Seattle.
Stevens also operates a retail pharmacy and three primary-care
clinics in the surrounding areas. Stevens provides services in
general medical and surgical care, intensive care, obstetrics,
pediatric, emergency, orthopedics, cardiac care, diabetes care,
oncology, radiology, rehabilitation, and mental health and has a
designated Level IV trauma center.
STANDARD PACIFIC: Moody's Cuts Corporate Family Rating to B1
------------------------------------------------------------
Moody's lowered the ratings of Standard Pacific Corp., including
its corporate family rating to B1 from Ba3, its senior unsecured
notes to B1 from Ba3, and its senior subordinated notes to B3 from
B2. The ratings outlook is negative.
The downgrades were prompted by:
(i) Standard Pacific's inability to keep debt leverage within
the 45-55% range;
(ii) the possibility that the company may have to seek further
covenant relief from its bank group following potential fourth
quarter impairments and FAS 109 adjustments;
(iii) Moody's expectation that the interest coverage ratio (as
defined by the banks) will fall below 1.5x in 2008; and
(iv) the possibility that Standard Pacific may have to contribute
additional equity to its joint venture partnerships in 2008.
The ratings acknowledge that:
(i) while the company, like many of its peers, has turned cash
flow positive on a trailing twelve month basis, it has
accomplished this, unlike most of its peers, largely through
actual inventory reduction rather than from one-time sources; and
(ii) the company's cash flow generation has continued to exceed
projections -- both those of the company and of Moody's -- and is
now among the more robust in the homebuilding industry.
The negative outlook reflects Moody's expectation that Standard
Pacific's credit metrics will continue to erode as homebuilding
industry conditions are expected to be challenging throughout
2008, with any recovery in 2009 likely to be sluggish.
Going forward, the ratings outlook could stabilize if the company
were to continue to expand its positive cash flow generation and
use the cash to augment liquidity and pay down debt.
The company's ratings could come under pressure if the company
were to have difficulty receiving further covenant relief, if
needed; if cash flow on a trailing twelve month basis were to turn
negative; or if debt leverage were to exceed 60% on a sustained
basis.
These rating actions were taken:
-- Corporate family rating downgraded to B1 from Ba3;
-- Probability of default rating downgraded to B1 from Ba3;
-- Senior unsecured debt ratings downgraded to B1 (LGD3, 48%)
from Ba3 (LGD3, 48%);
-- Senior subordinated debt ratings downgraded to B3
(LGD6, 94%) from B2 (LGD6, 94%).
Headquartered in Irvine, California and begun in 1966, Standard
Pacific Corp. constructs and sells single-family attached and
detached homes, with homebuilding operations located in
California, Texas, Arizona, Colorado, Florida, North and South
Carolina, and Nevada. Homebuilding revenues and net income
(including all charges) for the trailing twelve month period ended
Sept. 30, 2007 were approximately $3.3 billion and $(425) million,
respectively.
SUN MICROSYSTEMS: Moody's Ba1 Rating Unmoved by MySQL $1BB Deal
---------------------------------------------------------------
Moody's commented that Sun Microsystems, Inc.'s Ba1 corporate
family and unsecured debt rating with a stable outlook would not
be affected by the company's recent announcement that it has
entered into a definitive agreement to acquire MySQL AB for
approximately $1 billion. MySQL is a privately-held developer of
high performance open-source database software experiencing fast
growth in the $15 billion relational database management systems
market. Moody's believes the high purchase price is mitigated by
the strategic nature of the acquisition and long-term growth
opportunities in the RDBMS market, which is growing roughly at 14%
per annum. Having assembled nearly all of the elements for its
web-based platform strategy, the MySQL acquisition is consistent
with Sun's solutions-based operating model of selling a broader,
more integrated comprehensive offering of storage, servers,
software and services based on open architecture standards.
Sun expects to:
-- migrate its customers to MySQL's technology to deepen
existing relationships;
-- provide MySQL with access to its global infrastructure,
channels and OEM partnerships to accelerate the growth of
MySQL's mission critical deployment of applications for
large-scale customers; and
-- further exploit the secular shift in computing from
desktop to web-based platforms through up-sell and cross-
sell opportunities.
Given MySQL's small relative size, Moody's does not expect it to
be a major contributor to Sun's operating earnings over the near
term. However, Sun's strong liquidity profile, improved credit
protection measures and enhanced operating profile can absorb an
acquisition of this size.
"This pending transaction reflects Sun's historical penchant to
achieve growth through external means, which is currently factored
into the Ba1 CFR. Despite potential revenue synergies, access to
new untapped markets and cross-selling opportunities, Moody's
believes that Sun's acquisition strategy poses challenges for the
company to successfully integrate technologies and operations as
the company seeks to expand its business model into the software
space. Moody's expects Sun will continue to make selective
acquisitions to extend the reach of its products among software
developers and corporate customers, and strengthen its position as
a platform provider for the Web-based economy", stated Moody's
Vice President-Senior Analyst, Gregory Fraser.
Despite market share growth, improvements in profitability and
margins, and higher levels of free cash flow in Sun's recent past,
the Ba1 rating reflects the company's aggressive acquisition
strategy to grow beyond its core business. Sun has stated in its
public statements that it intends to be a consolidator in the IT
industry. The company has had an active acquisition program to
acquire small, emerging technology companies whose growth is
restrained by resources, distribution and infrastructure that can
benefit from Sun's global sales force and services organization.
The rating is constrained at Ba1, reflecting the ongoing
transition of the company's operating model away from a direct
product sale to a cross-product selling approach, which blends
hardware, software, and services into a single offering. Though
the solutions based sales approach focuses on the value
proposition of the bundled sale rather than individual pricing of
each component, by adapting to a strategy of selling lower priced
servers in order to obtain longer term service revenue streams,
the company is likely to witness operating margin pressure on the
hardware component of the overall solution sale, while potentially
generating future higher margin revenue streams. Moody's is also
concerned about the sustainability of this operating model given
that Sun's market share continues to be eclipsed by stronger
rivals such as IBM and HP.
Moody's expects that if the acquisition is consummated as
proposed, Sun would fund the transaction with approximately $800
million in cash and assume $200 million in MySQL options. The
company expects the transaction to close in the third or fourth
quarter of Sun's fiscal 2008 subject to regulatory approvals.
Moody's also expects that following the closing of the proposed
transaction, Sun will maintain moderate share purchase activity.
Sun's liquidity position is strong, with roughly $5 billion in
cash and marketable securities. Balance sheet debt totals
$1.27 billion, comprised of a $550 million note maturing in August
2009, a $350 million convertible due 2012, a $350 million
convertible due 2014 and $21 million in interest rate swaps. The
company also maintains full access to $391 million of uncommitted
credit lines. Moody's notes that further cash usage for material
acquisitions or stock purchases would likely have a negative
impact on the company's liquidity profile and potential credit
rating.
Sun Microsystems, Inc., based in Santa Clara, California, is a
leading worldwide provider of computer network systems and
solutions for enterprise customers. Revenue and EBITDA for the
twelve months ended Sept. 30, 2007 were $13.9 billion and
$1.8 billion, respectively.
SYNIVERSE TECH: Reports 2007 Full Year Preliminary Results
----------------------------------------------------------
Syniverse Technologies Inc. reported its preliminary results for
the year ended Dec. 31, 2007. Based on current unaudited
information, Syniverse currently expects to report:
* Net revenues of between $369 millionn - US$371 million,
compared to net revenues of $328.9 million for 2006.
* Adjusted EBITDA of between $154 million - $156 million,
compared to Adjusted EBITDA of $127.7 million in 2006.
* Cash Net Income, a non-GAAP measure of profitability, of
between $74 million - $75.3 million, compared to cash net
income of $57.3 million in 2006.
Syniverse expected its results to show continued strong growth
in technology interoperability, driven by continued growth in
data-related products as well as roaming and clearing services.
Gross margins and Adjusted EBITDA margins are both expected to
increase, reflecting growing revenues together with continued
cost management. Syniverse's recent acquisition of BSG
Wireless was not included in its operating results during 2007,
but will be included in its balance sheet.
"2007 was a strong year for Syniverse," said Tony Holcombe,
President and CEO of Syniverse. "This is a result of continued
strong data results and Syniverse's ongoing global expansion.
Our recent acquisition of BSG Wireless enhances our global
presence while providing significant efficiency savings and an
important financial clearinghouse service."
Outlook
The company is providing the following outlook for 2008:
Net Revenues $425 million - $440 million
Adjusted EBITDA $190 million - $200 million
Cash Net Income $85 million - $90 million
Additionally, the company expects to generate operating free
cash flow in excess of $100 million in 2008.
Syniverse has not yet finalized its financial statement close
process for the year ended Dec. 31, 2007. As it completes this
process, Syniverse may identify items that would require the
company to make adjustments to its preliminary operating
results. Additionally, the financial information in this press
release is not a comprehensive statement of our financial
results for the year ended Dec. 31, 2007 and should therefore be
considered together with our full results of operations when
published.
About Syniverse
Syniverse Technologies Inc. in Tampa, Florida (NYSE: SVR)
-- http://www.syniverse.com/-- provides technology services for
wireless telecommunications companies. Its integrated suite of
services include technology interoperability services, which
enable the invoicing and settlement of domestic and
international wireless roaming telephone calls and wireless data
events; SMS and MMS routing and translation services between
carriers; and interactive video and mobile broadband solutions,
prepaid applications, and roaming services. Celebrating its
20th anniversary in 2007, Syniverse has offices in major cities
around the globe. Syniverse is ISO 9001:2000 certified and TL
9000 approved, adhering to the principles of customer focus and
quality improvement practices. The company has offices in the
Netherlands, Brazil and China.
* * *
Standard & Poor's Ratings Services affirmed its 'BB-' corporate
credit rating, along with its stable outlook, and its 'B' senior
subordinated debt rating on Syniverse Technologies Inc on June
2007. At the same time, Standard & Poor's assigned its 'BB' bank
loan rating and '2' recovery rating to Syniverse's proposed
$489 million senior secured bank facility.
TALON FUNDING: Moody's Cuts Rating on $31.25 Mil. Notes to Ca
-------------------------------------------------------------
Moody's Investors Service placed these notes issued by Talon
Funding I, Ltd. on review for possible downgrade:
Class Description: $402,500,000 Class A Floating Rate Senior
Secured Notes due June 5, 2035
-- Prior Rating: Baa3
-- Current Rating: Baa3, on review for possible downgrade
In addition Moody's also downgraded these notes:
Class Description: $31,250,000 Class B Floating Rate Senior
Secured Notes due June 5, 2035
-- Prior Rating: Caa3
-- Current Rating: Ca
Class Description: $31,000,000 Class Cl Floating Rate Senior
Secured Notes due June 5, 2035
-- Prior Rating: Ca
-- Current Rating: C
Class Description: $14,000,000 Class C2 Fixed Rate Senior Secured
Notes due June 5, 2035
-- Prior Rating: Ca
-- Current Rating: C
According to Moody's, the rating actions are the result of
deterioration in the credit quality of the transaction's
underlying collateral pool, which consists primarily of structured
finance securities.
TEEKAY CORP: Earns $17 Million in 2007 Third Quarter
----------------------------------------------------
Teekay Corporation reported net income of $17.0 million on
revenues of $606.8 million for the quarter ended Sept. 30, 2007,
compared to net income of $79.8 million on revenues of
$477.7 million for the quarter ended Sept. 30, 2006.
Net revenues for the third quarter of 2007 increased to
$462.3 million from $344.3 million for the same period in 2006,
and income from vessel operations decreased to $80.6 million from
$105.0 million. Net revenues, defined as revenues less voyage
expenses, is a non-GAAP financial measure used by certain
investors to measure the financial performance of shipping
companies.
Net income for the nine months ended Sept. 30, 2007 was
$171.8 million, $201.9 million for the same period last year. Net
revenues for the nine months ended Sept. 30, 2007, increased to
$1.4 billion from $1.0 billion for the same period in 2006, and
income from vessel operations increased to $323.7 million from
$316.7 million.
Share Repurchase Program
Since Aug. 1, 2007, the company has repurchased 978,400 shares of
its common stock at an average price of $54.80 per share,
resulting in $44.3 million remaining under the existing share
repurchase authorization. As at Sept. 30, 2007, the company had
73.3 million common shares issued and outstanding.
OMI Acquisition Update
On Aug. 1, 2007, most of the assets from the joint acquisition of
OMI Corporation were divided equally between Teekay and A/S
Dampskibsselskabet (Torm). Through this acquisition, Teekay
acquired seven Suezmax tankers, four Medium Range product tankers
and four Handysize product tankers. Teekay also assumed OMI's in-
charters of a further six Suezmax tankers and OMI's third party
asset management business, the Gemini pool. Teekay and Torm will
continue to hold two Medium Range product tankers jointly in OMI,
as well as two Handysize product tanker newbuildings scheduled to
deliver in 2009. The parties intend to divide these remaining
assets equally in due course.
Teekay has consolidated the results of the vessels it acquired
from OMI effective Aug. 1, 2007. For the period of July 1 to
July 31, 2007, OMI's results were accounted for using the equity
method of accounting.
At Sept. 30, 2007, the company had total liquidity of $1.9 billion
(excluding debt related to capital commitments), comprised of
$297 million in cash and cash equivalents and $1.6 billion in
undrawn credit facilities.
Balance Sheet
At Sept. 30, 2007, the company's consolidated balance sheet showed
$9.63 billion in total assets, $6.43 billion in total liabilities,
$513.6 million in minority interest, and $2.68 billion in total
stockholders' equity.
About Teekay Corp.
Headquartered in Nassau, Bahamas, Teekay Corporation (NYSE: TK) --
http://www.teekay.com/-- transports more than 10 percent of the
world's seaborne oil, has built a significant presence in the
liquefied natural gas shipping sector through its publicly-listed
subsidiary, Teekay LNG Partners L.P. (NYSE: TGP), and is further
growing its operations in the offshore production, storage and
transportation sector through its publicly-listed subsidiaries,
Teekay Offshore Partners L.P. (NYSE: TOO) and Teekay Petrojarl ASA
(OSE: TPO). With a fleet of over 185 vessels, offices in 17
countries and 6,300 seagoing and shore-based employees, Teekay
provides a comprehensive set of marine services to the world's
leading oil and gas companies, helping them seamlessly link their
upstream energy production to their downstream processing
operations.
* * *
As reported in the Troubled Company Reporter on Dec. 26, 2007,
Moody's Investors Service affirmed its debt ratings of Teekay
Corporation -- Corporate Family of Ba2, senior unsecured of Ba3
and speculative grade liquidity rating of SGL-2. The rating
outlook was changed to stable from negative.
TOTAL VEIN: Voluntary Chapter 11 Case Summary
---------------------------------------------
Debtor: Total Vein Solutions, L.L.C.
901 Yale Street
Houston, TX 77008
Bankruptcy Case No.: 08-30203
Type of Business: The Debtor markets a line of venous surgery
packs, laser fibers, access devices and surgical
supplies. See http://www.totalvein.com
Chapter 11 Petition Date: January 17, 2008
Court: Southern District of Texas (Houston)
Judge: Jeff Bohm
Debtor's Counsel: Richard L Fuqua, II, Esq.
Fuqua & Keim
2777 Allen Parkway, Suite 480
Houston, TX 77019
Tel: (713) 960-0277
Total Assets: $1,489,669
Total Debts: $242,414
The Debtor did not file a list of its largest unsecured creditors.
TOUSA INC: S&P Slashes Rating on $200 Million Senior Notes to D
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on TOUSA
Inc.'s $200 million 7.5% senior subordinated notes to 'D' from 'C'
after the company announced that it had failed to make
scheduled interest payments on this debt obligation.
Concurrently, S&P affirmed all other ratings assigned to the
company. However, if TOUSA does not make delinquent interest
payments on a previous default by Jan. 30, 2008, other debt
obligations of the company could become due and payable
immediately. S&P does not believe TOUSA has the liquidity
necessary to satisfy all of its debt obligations in this scenario.
TOUSA previously announced that it had amended its first-lien term
loan and revolving credit agreements. The amendments extend
through Feb. 1, 2008, and include a requirement that TOUSA operate
under a cash flow budget that does not provide for payments on its
long-term debt.
Hollywood, Florida-based TOUSA is a midsize regional homebuilder
that has faltered due to a highly leveraged balance sheet and
heavy concentration in Florida and other oversupplied housing
markets. TOUSA is considering several restructuring options,
including a Chapter 11 bankruptcy filing.
Rating Lowered
TOUSA Inc.
Rating
------
To From
-- ----
$200 million 7.5% senior sub notes due 2015 D C
Ratings Affirmed
TOUSA Inc.
Rating
------
$250 million 8.25% senior notes
due 2011 C
$125 million 7.5% senior sub notes
due 2011 C
$200 million senior secd 1st-lien
term loan CC (Recovery rtg: 2)
$300 million senior secd 2nd-lien
term loan C (Recovery rtg: 6)
Other Outstanding Ratings
TOUSA Inc.
Rating
------
Corporate credit D/--/--
$300 million 9% senior notes due 2010 D
$185 million 10.375% senior sub notes due 2012 D
TRAINER WORTHAM: Moody's Reviews B2 Rating on $23 Million Notes
---------------------------------------------------------------
Moody's Investors Service placed these notes issued by Trainer
Wortham First Republic CBO II, Limited on review for possible
downgrade:
Class Description: $295,000,000 Class A-1L Floating Rate Notes Due
2037
-- Prior Rating: Aa2
-- Current Rating: Aa2, on review for possible downgrade
In addition Moody's also downgraded and left on review for
possible downgrade these notes:
Class Description: $23,000,000 Class A-2L Floating Rate Notes Due
2037
-- Prior Rating: Baa3
-- Current Rating: B2, on review for possible downgrade
According to Moody's, the rating actions are the result of
deterioration in the credit quality of the transaction's
underlying collateral pool, which consists primarily of structured
finance securities.
TRIGEM COMPUTER: Representative Files 5th Section 1518(1) Report
----------------------------------------------------------------
Charles D. Axelrod, Esq., at Stutman, Treister & Glatt P.C., in
Los Angeles, California, on behalf of Il-Hwan Park, the foreign
representative for TriGem Computer, Inc., delivered to the U.S.
Bankruptcy Court for the Central District of California a fifth
status report pursuant to Section 1518(1) of Chapter 15 of the
Bankruptcy Code on December 26, 2007.
Mr. Axelrod relates that on October 4, 2007, parties-in-interest
in TriGem's bankruptcy proceeding before the Suwon District
Court, Bankruptcy Division, in the Republic of Korea, approved by
the required votes a final amendment to TriGem's amended plan of
reorganization, which incorporated the terms of the Second M&A
Tender.
The Korea Bankruptcy Court subsequently confirmed TriGem's final
amended plan. TriGem's reorganization plan calls for the sale of
the company's assets through a merger and acquisition type
transaction.
Individual shareholders of TriGem have filed an appeal with
respect to the Korea Bankruptcy Court's confirmation order. The
shareholders were not pleased with the reduction of TriGem's
capital as contemplated by the final amended plan, Mr. Axelrod
says.
Mr. Axelrod says that in December 2007, TriGem settled with the
the individual shareholders and they eventually withdrew their
appeal.
Since no injunctive relief was sought in connection with the
individual shareholders' appeal, all actions scheduled to take in
the Foreign Proceeding will still occur, except for the issuance
of a final decree by the Korea Bankruptcy Court. TriGem's
corporate reorganization proceedings in Korea may close in late
2007 or early 2008, according to Mr. Axelrod.
Mr. Axelrod also reports that Mr. Park will commence an adversary
proceeding to permanently enjoin the prepetition litigation that
was pending against TriGem Computer at the time of the
commencement of TriGem's Chapter 15 case.
When the adversary proceeding has been concluded, Mr. Park will
then address the propriety of closing TriGem's Chapter 15
proceeding, relates Mr. Axelrod.
The corporate reorganization proceeding of TriGem was recognized
as a foreign main bankruptcy proceeding under Chapter 15 of the
U.S. Bankruptcy Code as ordered by the U.S. Bankruptcy Court for
the Central District Of California on December 7, 2005.
A full-text copy of TriGem's status report dated Dec. 26, 2007, is
available at no charge at:
http://chapter15.com/c15_files/20080103/0019StatusReportNo5.ppdf
About TriGem Computer
Headquartered in Ansan City, Kyunggi-Do, Korea, TriGem Computer
Inc. -- http://www.trigem.com/-- manufactures desktop PCs,
notebook PCs, LCD monitors, printers, scanners, other computer
peripherals, and PIDs and supplies over four million PCs a year
to clients all over the world. Il-Hwan Park, the Foreign
Representative, filed a chapter 15 petition on Nov. 3, 2005
(Bankr. C.D. Calif. Case No. 05-50052). Charles D. Axelrod,
Esq., at Stutman Treister & Glatt, P.C., represents the Foreign
Representative in the United States.
TriGem America Corporation, an affiliate of the Debtor, filed
for chapter 11 protection on June 3, 2005 (Bankr. C.D. Calif.
Case No. 05-13972). TriGem Texas, Inc., another affiliate of
the Debtor, also filed for chapter 11 protection on June 8,
2005 (Bankr. C.D. Calif. Case No. 05-14047).
On Sept. 13, 2007, TriGem filed Draft Plan Amendments in Korea and
on September 20 filed a Final Plan Amendment. The Korean Court
confirmed Trigem's Amended Plan on Oct. 4, 2007. (TriGem
Bankruptcy News, Issue No. 13 Bankruptcy Creditors' Service, Inc.,
215/945-7000).
TRIGEM COMPUTER: Wants Toshiba's Prepetition Lawsuit Enjoined
-------------------------------------------------------------
TriGem Computer, Inc., asks the U.S. Bankruptcy Court for the
Central District of California to permanently enjoin the
continuation of a prepetition lawsuit commenced by Toshiba
Corporation, David Packard and John E. Cock against the Korean PC
maker in the U.S. District Court for the Central District of
California.
In the alternative, TriGem suggests that the Bankruptcy Court
allow its bankruptcy case under Chapter 15 of the U.S. Bankruptcy
Code, to remain open in perpetuity so that the automatic stay
will continue and obviate the need to permanently enjoin the
continuation of Toshiba, et al.'s litigation.
Toshiba is a company based in Japan, while Mr. Packard resides in
Vidor, Texas. Mr. Hock lives in Round Rock, Texas.
Toshiba et al.'s lawsuit was automatically stayed upon TriGem's
Chapter 15 bankruptcy filing on November 3, 2005.
On December 8, 2005, Judge Thomas Donovan approved TriGem's
request to recognize its corporate reorganization proceedings
before the Suwon District Court, Bankruptcy Division, in the
Republic of Korea, as a foreign main proceeding under Chapter 15.
Toshiba filed a proof of claim against TriGem in the CRA case
that was subsequently disallowed by the Korean Bankruptcy Court.
Messrs. Packard and Hock did not file a proof of claim in the CRA
Case.
Toshiba then filed a notice of appearance and request for notice
in TriGem's Chapter 15 case. The notice required with respect to
the deadline to file claims in the CRA Case was duly given.
Charles D. Axelrod, Esq., at Stutman, Treister & Glatt, P.C., in
Los Angeles, California, on behalf of Il-Hwan Park, the foreign
representative for TriGem, says TriGem's plan of reorganization
has been accepted by creditors and confirmed by the Korean
Bankruptcy Court.
It is anticipated that TriGem's CRA Case will be closed either in
late 2007 or early 2008, and TriGem may file a request to close
its Chapter 15 case once the CRA case is closed, according to
Mr. Axelrod.
Toshiba and Messrs. Packard and Hock will neither receive nor
retain any claim against or interest in TriGem under the
confirmed plan in the CRA Case. Under Korean Law, the Plaintiffs
have no enforceable claim against or interest in TriGem.
Mr. Axelrod notes that the automatic stay against the
continuation of the Plaintiffs' litigation against TriGem will
terminate when TriGem's Chapter 15 case is closed. Under Section
1521 of Chapter 15 of the Bankruptcy Code, the Bankruptcy Court
has the power to permanently enjoin the continuation of the
Plaintiffs' litigation, Mr. Axelrod argues.
An injunction is sought to enforce TriGem's confirmed plan in the
CRA Case and to enforce the disallowance of the Plaintiffs'
prepetition claims in the CRA Case, in order to obviate any
attempt by Toshiba et al., from recovering the disallowed claims
in TriGem's Chapter 15 case, Mr. Axelrod says.
Mr. Axelrod explains that substantial precedent exists for
granting comity to the bankruptcy laws of South Korea since
federal courts in the United States have recognized that fairness
and due process consistent with that practiced in the U.S. is
practiced in the courts of South Korea.
In addition, the only way to assure that the alleged claims of
the Plaintiffs against TriGem are consistently settled is to have
a single court to make the determination and that determination
has already been made in the CRA Case, Mr. Axelrod contends.
About TriGem Computer
Headquartered in Ansan City, Kyunggi-Do, Korea, TriGem Computer
Inc. -- http://www.trigem.com/-- manufactures desktop PCs,
notebook PCs, LCD monitors, printers, scanners, other computer
peripherals, and PIDs and supplies over four million PCs a year
to clients all over the world. Il-Hwan Park, the Foreign
Representative, filed a chapter 15 petition on Nov. 3, 2005
(Bankr. C.D. Calif. Case No. 05-50052). Charles D. Axelrod,
Esq., at Stutman Treister & Glatt, P.C., represents the Foreign
Representative in the United States.
TriGem America Corporation, an affiliate of the Debtor, filed
for chapter 11 protection on June 3, 2005 (Bankr. C.D. Calif.
Case No. 05-13972). TriGem Texas, Inc., another affiliate of
the Debtor, also filed for chapter 11 protection on June 8,
2005 (Bankr. C.D. Calif. Case No. 05-14047).
On Sept. 13, 2007, TriGem filed Draft Plan Amendments in Korea and
on September 20 filed a Final Plan Amendment. The Korean Court
confirmed Trigem's Amended Plan on Oct. 4, 2007. (TriGem
Bankruptcy News, Issue No. 13 Bankruptcy Creditors' Service, Inc.,
215/945-7000).
TRUEYOU.COM INC: Sept. 29 Balance Sheet Upside-Down by $75.4 Mil.
-----------------------------------------------------------------
TrueYou.Com Inc.'s consolidated balance sheet at Sept. 29, 2007,
showed $11.0 million in total assets and $86.4 million in total
liabilities, resulting in a $75.4 million total stockholders'
deficit.
The company's consolidated balance sheet at Sept. 29, 2007, also
showed strained liquidity with $9.7 million in total current
assets available to pay $15.0 million in total current
liabilities.
The company reported a net loss of $3.9 million on revenues of
$2.0 million for the first quarter ended Sept. 29, 2007, compared
with net income of $23.7 million on revenues of $904,0000 ended
Sept. 30, 2006.
All revenues during the two quarters were derived from the U.S.
The increase in revenue was primarily due to sales to Home
Shopping Network, which was added as a customer with the signing
of a marketing agreement on April 2, 2007.
In the first quarter ended Sept. 30, 2006, the company recorded an
unrealized gain on convertible securities of approximately
$40.5 million. This compares with an unrealized loss on
convertible securities of $472,000 for the three months ended
Sept. 30, 2007.
Results for the first quarter of 2006 also included a loss of
$6.6 million from the discontinued operations of the company's
spa/salons which were sold to GK Acquisition LLC, an unaffiliated
third party on May 7, 2007.
Full-text copies of the company's consolidated financial
statements for the quarter ended Sept. 29, 2007, are available for
free at http://researcharchives.com/t/s?2722
Going Concern Doubt
As reported in the Troubled Company Reporter on Nov. 26, 2007,
Edison, N.J.-based Amper, Politziner & Mattia, PC, expressed
substantial doubt about TrueYou.Com Inc.'s ability to
continue as a going concern after auditing the company's
consolidated financial statements for the year ended June 30,
2007.
The auditing firm pointed to the company's operating losses and
negative cash flows from operations since inception, and working
capital deficit.
About TrueYou.Com Inc.
Headquartered in New York TrueYou.Com Inc., (Other OTC: TUYU.PK)
develops over-the-counter skin care line of products, called
Cosmedicine, in the United States. The company retails its skin
care products through a strategic alliance with Sephora USA Inc.,
as well as at exclusive stores, such as Home Shopping Network and
JCPenney, and their respective Web sites.
UAP HOLDING: Paying $0.225/Share Qtrly. Dividend on February 15
---------------------------------------------------------------
UAP Holding Corp.'s board of directors declared a quarterly
dividend payment, at the rate of $0.225 per share, payable on
Feb. 15, 2008, to stockholders of record as of the close of
business on Feb. 1, 2008.
Headquartered in Greeley, Colorado, UAP Holdings Corp.
(NASDAQ:UAPH) -- http://www.uap.com/-- is the holding company of
United Agri Products Inc., an independent distributor of
agricultural and non-crop products in the United States and
Canada. United Agri Products Inc. markets products, including
chemicals, fertilizer, and seed to farmers, commercial growers,
and regional dealers. United Agri Products also provides an array
of value-added services, including crop management, biotechnology
advisory services, custom fertilizer blending, seed treatment,
inventory management, and custom applications of crop inputs.
United Agri Products maintains a network of approximately 370
distribution and storage facilities and three formulation plants,
located in crop-producing areas throughout the United States and
Canada.
* * *
As reported in the Troubled Company Reporter on Jan. 16, 2008,
Standard & Poor's Ratings Services said that the recent
statements by Agrium Inc. of potential delays in closing its UAP
Holding Corp. acquisition will not affect the 'BB-/Watch Positive'
ratings on Agrium.
VESTA INSURANCE: Florida Select Wants Exclusive Period Extended
---------------------------------------------------------------
Florida Select Insurance Agency, Inc., asks the U.S. Bankruptcy
Court for the Northern District of Alabama to extend its exclusive
period within which to solicit acceptances of its plan of
liquidation though May 19, 2008.
The Debtor's current Exclusive Solicitation Period will expire on
February 18, 2008.
The Debtor seeks an extension of its Exclusive Solicitation
Period to provide each creditor sufficient time to analyze and
determine whether or not to accept or negotiate changes in the
Plan, Rufus T. Dorsey, Esq., at Parker, Hudson, Rainer & Dobbs
LLP, in Atlanta, Georgia, tells the Court.
Mr. Dorsey relates that the Debtor has spent a significant amount
of time to resolve the claim disputes of its affiliates and the
funds in its possession before the filing its Disclosure
Statement with the Court. Absent an extension, he says, the
Debtor's creditors will not have ample time to analyze whether or
not to accept the Plan.
Furthermore, the requested extension is needed because the Debtor
is part of a complex insurance network where many of its
affiliates have filed bankruptcy or been placed in receiverships,
Mr. Dorsey adds. The Debtor's bankruptcy case involves
substantial number of claims, general managing agreements, and
tax-sharing agreements between the Debtor and its affiliates.
Until these intercompany disputes are resolved, no distribution
of the Debtor's assets can be made, he explains.
Mr. Dorsey assures the Court that the Debtor has sufficient
liquidity to pay its postpetition debts as they come due. Hence,
an extension of the Exclusivity Solicitation Period will not
jeopardize the rights of the Debtor's postpetition creditors, he
maintains.
According to Mr. Dorsey, the Debtors intend to dedicate
significant time to continue its discussions with two of its
largest creditors, Barger & Wollen, LLP, and Franchise Tax Board.
Under the circumstances, the Debtors assert that its extension
request ensures that its exclusivity is preserved while it
attempts to resolve these claim disputes and determine the amount
of assets for distribution.
Mr. Dorsey emphasizes that the Debtors' requested extension will
not prejudice the legitimate interests of any of its creditors
but will facilitate the development of a consensual Liquidation
Plan.
"[The] Debtor is not seeking [the] extension . . . as a
negotiation tactic or as a means of maintaining leverage over any
group of creditors whose interests may be harmed . . . but merely
to give itself sufficient time to seek acceptances of the Plan
[to] maximize the value of the estate, and to give creditors
sufficient time to consider the Plan," Mr. Dorsey maintains.
About Vesta Insurance
Headquartered in Birmingham, Alabama, Vesta Insurance Group, Inc.
(Other OTC: VTAI.PK) -- http://www.vesta.com/-- is a holding
company for a group of insurance companies that primarily offer
property insurance in targeted states.
Wyatt R. Haskell, Luther S. Pate, UV, and Costa Brava Partnership
III, L.P., filed an involuntary chapter 7 petition against the
company on July 18, 2006 (Bankr. N.D. Ala. Case No. 06-02517).
The case was converted to a voluntary chapter 11 case on Aug. 8,
2006 (Bankr. N.D. Ala. Case No. 06-02517). Eric W. Anderson,
Esq., at Parker Hudson Rainer & Dobbs, LLP, represents the Debtor.
R. Scott Williams, Esq., at Haskell Slaughter Young & Rediker,
LLC, represents the petitioning creditors. In its schedules of
assets and liabilities, Vesta listed $14,919,938 in total assets
and $214,278,847 in total liabilities.
J. Gordon Gaines Inc. is a Vesta Insurance-owned unit that
manages the company's numerous insurance subsidiaries and employs
the headquarters workers. The company filed for chapter 11
protection on Aug. 7, 2006 (Bankr. N.D. Ala. Case No. 06-02808).
Eric W. Anderson, Esq., at Parker Hudson Rainer & Dobbs, LLP,
represent the Debtor in its restructuring efforts. In its
schedules of assets and liabilities, Gaines listed $19,818,094 in
total assets and $16,046,237 in total liabilities.
On Aug. 1, 2006, the District Court of Travis County, Texas
entered an order appointing the Texas Commissioner of Insurance
as Liquidator of Vesta Insurance's Texas-domiciled subsidiaries:
Vesta Fire Insurance Corporation; The Shelby Insurance Company;
Shelby Casualty Insurance Corporation; Texas Select Lloyds
Insurance Company; and Select Insurance Services, Inc.
On Oct. 11, 2006, both Vesta and Gaines filed separate Plans of
Liquidation and Disclosure Statements. They filed an amended Plan
on Nov. 7, 2006, and a Second Amended Plan on Nov. 10, 2006. The
Court approved the Disclosure Statements of Vesta and Gaines on
Nov. 10, 2006. On Dec. 22, 2006, the Court confirmed the Third
Amended Plans of Vesta and Gaines.
Florida Select Insurance Agency Inc., an affiliate, filed for
chapter 11 protection on April 24, 2007 (Bankr. N.D. Ala. Case No.
07-01849). Rufus Dorsey, IV, Esq., at Parker Hudson Rainer &
Dobbs LLP, represents Florida Select. FSIA's exclusive period to
file a plan of reorganization expired Dec. 20, 2007. (Vesta
Bankruptcy News, Issue No. 31; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000)
VOUGHT AIRCRAFT: S&P Changes Outlook to Negative from Developing
----------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on
aerospace supplier Vought Aircraft Industries Inc. to negative
from developing. At the same time, Standard & Poor's affirmed its
ratings, including the 'B-' corporate credit rating, on the
company. Vought has about $685 million of debt outstanding.
"The outlook revision reflects heightened liquidity concerns as a
result of the additional delays announced by Boeing Co.
(A+/Stable/A-1) on its new 787 jetliner," said Standard & Poor's
credit analyst Roman Szuper.
Although the 787 should be a successful program later this decade
and beyond, its first flight has now been moved to the end of the
second quarter of 2008 from the end of the first quarter, with
initial deliveries scheduled to begin in early 2009 rather than
late 2008. The delays will adversely affect
the working capital and cash flow of most suppliers, including
Vought. Boeing is in discussions with its suppliers regarding
changes to the contracts, which in many cases specified that the
vendors would get paid for their shipments only when the 787 is
certified and delivered to the first customer.
Mr. Szuper noted, "The ratings on Vought reflect a highly
leveraged financial profile, stemming from high debt levels and
prior losses, the large up-front costs and long, uncertain payback
period associated with investing in new programs, limited program
diversity, and exposure to the cyclical and
competitive commercial aircraft industry. These factors are
offset somewhat by the company's major market position, its
strategic importance to Boeing, and the strength of the commercial
aerospace market at the current time."
WESTWAYS FUNDING: Moody's Reviews B2 Rating on Class D Notes
------------------------------------------------------------
Moody's Investors Service has taken action on five classes of
notes issued by Westways Funding XI, Ltd., a Market Value CDO
issuer:
(1) $31,500,000 Class B Floating Rate Senior Subordinate Notes
Due 2013;
-- Prior Rating: Aa2 on review for possible downgrade
-- Current Rating: A2 on review for possible downgrade
(2) $21,500,000 Class LB Subordinate Loan Interests Due
2013;
-- Prior Rating: Aa2 on review for possible downgrade
-- Current Rating: A2 on review for possible downgrade
(3) $31,500,000 Class C Floating Rate Subordinate Notes Due
2013;
-- Prior Rating: A2 on review for possible downgrade
-- Current Rating: Baa2 on review for possible downgrade
(4) $8,500,000 Class LC Subordinate Loan Interests Due 2013;
-- Prior Rating: A2 on review for possible downgrade
-- Current Rating: Baa2 on review for possible downgrade
(5) $31,500,000 Class D Floating Rate Junior Subordinate Notes
Due 2013
-- Prior Rating: Ba2 on review for possible downgrade
-- Current Rating: B2 on review for possible downgrade
Moody's noted that while the underlying assets are composed of
agency and non-agency Aaa-rated mortgage backed securities, the
unprecedented illiquidity in the market for mortgage-backed
securities has created a high level of uncertainty around the
valuation of the assets. As evidenced by recent market events,
Moody's has observed wider discrepancies than before between
realized prices for these assets and their marked-to-market
values.
WINSTAR COMMUNICATIONS: Lucent Files Reply Brief
------------------------------------------------
On behalf of Lucent Technologies, Inc., Craig Goldblatt, Esq., at
Wilmer Cutler Pickering Hale and Dorr, LLP, Washington D.C.,
tells the U.S. Court of Appeals for the Third Circuit that Lucent
was not an insider, pointing out that it did not exercise actual
managerial control of Winstar Communications, Inc.
As reported in the Troubled Company Reporter on Dec. 17, 2007,
Stephen M. Rathkopf, Esq., at Herrick Feinstein LLP in New York,
on behalf of Christine C. Shubert, the Chapter 7 Trustee for
Winstar, told the Appellate Court that Lucent was Winstar's
"strategic partner" -- turnkey builder of Winstar's network,
primary vendor, supplier, subcontractor and financier, all rolled
into one. Evidence at trial established, and the United States
District Court for the District of Delaware found, that Lucent was
not simply enforcing its legitimate contractual rights, Mr.
Rathkopf said. Thus, Mr. Rathkopf argued, the District Court's
decision should be affirmed.
Mr. Goldblatt howevers says that, Christine C. Shubert, the
Chapter 7 Trustee of Winstar, "supplies no workable guidepost for
determining when the rough-and-tumble dealings of self-interested
commercial actors cross the line into 'too much' influence.
Instead, she blithely asserts that this line-drawing can be left
to 'the capabilities of the courts.'"
According to Mr. Goldblatt, the Chapter 7 Trustee is trying to
paint Lucent as a bad actor.
To the extent Lucent accounted improperly for its transactions,
the remedy lies in the securities laws, not in the Bankruptcy
Code, Mr. Goldblatt tells the Third Circuit, noting that Lucent
had reported its questionable accounting to the Securities and
Exchange Commission and paid a substantial fine.
Mr. Golblatt also argues that Winstar's $188,180,000 payment to
Lucent was already "earmarked" as Siemens and Winstar have agreed
that the proceeds from the $200,000,000 Siemens loan would be
paid to Lucent.
Mr. Goldblatt also notes that the Chapter 7 Trustee stipulated
that Winstar's December 7, 2000 payment to Lucent "represented a
payment of the . . . net proceeds of the Siemens loan" minus a
set-off. The Winstar Trustee is attempting to wriggle out of
that stipulation, he says.
Mr. Golblatt says the transfer did not diminish the Winstar
estate. Moreover, Lucent, he says, did not waive the earmarking
provision.
Lucent provided $90,700,000 in new value to the Winstar estate,
Mr. Golblatt contends. Lucent, he says, provided $28,400,000 in
unsecured new value for equipment and related services as well as
$62,300,000 in unsecured new value under the parties' second
credit agreement.
Lucent's loan was unsecured, according to Mr. Goldblatt.
Lucent also asked the Third Circuit to reverse the Bankruptcy
Court's final judgment for Winstar on the Winstar Wireless
subcontract. The subcontract wasn't modified and any attempted
modification would be ineffective because of a clause requiring
that any modifications to be in writing, Mr. Goldblatt explains.
According to Mr. Goldblatt, the Chapter 7 Trustee claims that the
parties abandoned the terms of the Subcontract and that Lucent
agreed instead to write Winstar Wireless a blank check, paying
for whatever work Wireless in its sole discretion chose to do.
That claim is both wholly implausible on its face and
inconsistent with the strict rules for contractual modification
established by New York law, Mr. Goldblatt notes. While Lucent
had previously paid Wireless invoices without insisting on
adherence to every condition in the contract, Lucent made clear
that it would require adherence after September 2000, he
explains.
"It is a basic tenet of contract law that a landlord who permits
a tenant to make a late payment in January and February may still
insist on timely payment in March. That simple principle is
controlling here," Mr. Goldblatt says.
Mr. Goldblatt also tells the Third Circuit that Lucent's conduct
did not merit equitable subordination.
Even if equitable subordination were appropriate, equitable
subordination is remedial, not penal, and should be applied only
to the extent necessary to offset specific harm suffered by
creditors on account of the inequitable conduct, according to Mr.
Goldblatt. He points out that the Bankruptcy Court failed to
heed this standard.
Mr. Goldblatt explains that Lucent's claim had two parts:
1. Lucent had an unsecured claim for the $800,000,000 in loans
to Winstar, plus additional goods and services it provided
on credit; and
2. Lucent had a secured claim for the value of the equipment
and other collateral held by the special-purpose borrowers
-- which the parties stipulated was roughly $21,000,000.
The Bankruptcy Court not only subordinated Lucent's entire
unsecured claim, providing that it would recover nothing on that
claim, but also transferred the value of Lucent's lien to the
estate, depriving Lucent of the $21,000,000 in collateral, Mr.
Goldblatt says.
In subordinating Lucent's claim, the Bankruptcy Court relied on
Winstar's purchases of unneeded Lucent equipment. But Winstar
never paid for most of that equipment.
"Simply subordinating the portion of Lucent's unsecured claim
arising out of the sale of unneeded equipment (ensuring that
Lucent would never recover anything on account of that sale)
would remedy any harm to the estate from Lucent's claim for such
unpaid-for equipment. In order to justify any further remedy,
such as the bankruptcy court's decision to transfer Lucent's
lien to the estate, it would be necessary to quantify how much
unneeded equipment the estate in fact paid for. The bankruptcy
court did nothing of the sort," Mr. Goldblatt says.
A full-text copy of Lucent's Reply Brief is available at no
charge at http://bankrupt.com/misc/Lucentreplybrief.pdf
About Winstar Communications
Based in New York, New York, Winstar Communications, Inc.,
provides broadband services to business customers. The company
and its debtor-affiliates filed for chapter 11 protection on
April 18, 2001 (Bankr. D. Del. Case Nos. 01-01430 through
01-01462). The Debtors obtained the court's approval converting
their case to a chapter 7 liquidation proceeding in Jan. 24, 2002.
Christine C. Shubert serves as the Debtors' chapter 7 trustee.
The chapter 7 trustee is represented by Fox Rothschild LLP and
Kaye Scholer LLP. When the Debtors filed for bankruptcy, they
listed $4,975,437,068 in total assets and $4,994,467,530 in total
debts. (Winstar Bankruptcy News, Issue No. 83; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)
* Fitch Says US CMBS Delinquencies Are Likely to Triple
-------------------------------------------------------
After closing 2007 at a low (0.28%), U.S. CMBS delinquencies are
likely to double, and perhaps even triple, by the end of 2008,
according to Fitch Ratings latest U.S. CMBS loan delinquency
index.
Such an increase, if it takes place, would put CMBS delinquencies
close to or slightly above the annual average default rate of 79
basis points. 'Additional economic stress to property cash flows,
declining defeasance volume, balloon defaults and the decrease in
new origination volume is likely to contribute to the increase in
Fitch's loan delinquency index,' said Director Michelle Bayard.
A look at Fitch's 2007 monthly index led to an overall fall of
nine bps to 0.28%, the year ending low, from 0.37%, the high in
January 2007. The January high point was followed by a six-month
consecutive decline in the index. Delinquencies ticked up
slightly until November when it climbed three bps in one month.
The multifamily sector ended 2007 with $427.8 million more in
delinquent loans. In December 2007, there were 145 multifamily
loans with aggregate proceeds of $871.2 million compared to 99
loans comprising $443.5 million in January 2007.
The rising multifamily delinquencies were concentrated by
geography. As of December 2007, the states with the highest
concentrations were Texas (49.5%), Michigan (9.9%), and Tennessee
(9.9%). Texas in particular exhibited a dramatic increase in
November 2007 with an additional $308.9 million in delinquent
multifamily loans, although most of this increase was attributed
to one sponsor MBS Cos. The defaulted loans of this sponsor were
also a large contributor to the three bps increase in November.
The delinquent multifamily loans were also highly concentrated by
recent vintage. As of December 2007, the vintages with the
highest concentrations were 2006 (21.9%), 2004 (17.5%), and 2005
(16.1%). These three recent vintages accounted for 55.4% of all
delinquent multifamily loans.
The top three vintages for all property types at the end of 2007
were 1998, 2005, and 2006 compared to 1999, 1998, and 2000 in
January 2007. The delinquencies in deals securitized in 1998
reflect typical default patterns. However, the delinquencies in
2005 and 2006 occurred earlier than expected. These were a
combination of the MBS loans as well as a spike in small balance
multifamily loans. As of December 2007, there were 31 delinquent
loans comprising $233.4 million within 2005 transactions. There
were 52 delinquent loans comprising
$221.1 million within 2006 transactions.
Fitch maintains a parallel loan delinquency index that tracks only
loans within seasoned transactions - those that have been
securitized for at least one year. In 2007, the seasoned LDI
decreased by 15 bps from 0.50% to 0.35%, which is largely due to
the increased balance of Fitch-rated seasoned transactions, which
rose by $137.5 billion (48.5%). Typically, the addition of newly
seasoned deals results in downward pressure on the seasoned loan
delinquency index because the deals have no delinquent loans.
However, six transactions (all securitized in 2006) comprising
$11.8 billion which became seasoned in December 2007 already had
16 delinquent loans with combined balances of $97.1 million.
The LDI tracks delinquent loans in all CMBS transactions rated by
Fitch. As of December 2007, the Fitch-rated universe comprised
480 transactions with aggregate loan balances of $556.9 billion.
Fitch defines as delinquent those loans that are at least 60 days
late, REO, in foreclosure, or non-performing matured. Fitch
tracks ten categories of commercial property types: Office,
Retail, Hotel, Multifamily, Industrial, Health Care, Self Storage,
Manufactured Housing, Mixed-Use, and Other.
* Fitch Says US Retail Industry Outlook Remains Challenging
-----------------------------------------------------------
Following the 2007 holiday season, the outlook for the U.S. retail
industry remains challenging with comparable store sales growth
expected to be weaker in 2008 compared to 2007, according to a
Fitch Ratings report.
A combination of high energy and commodity costs and weak housing
and credit markets pressured consumers during the 2007 holiday
period, with comparable store sales of 2.2% in 2007, versus 2.8%
in 2006. As a result, Fitch is cautious about Q4/07 operating
margins for retailers, particularly for those that entered the
holiday season with excess inventories. The combination of
pressured revenues, promotional activity, and higher
energy/commodity costs will strain operating profit margins.
As the challenges facing consumers are unlikely to abate in the
1H/08, consumers at all but the highest income levels are expected
to moderate discretionary spending. The retail segments most
affected will likely be home and apparel related while more staple
retail segments, such as supermarkets and drug stores, are
expected to show relative strength.
'The differences between strong and weak retailers will become
more evident as the year progresses,' said Karen Ghaffari,
Managing Director, Fitch Ratings. 'Competition will remain
intense, especially in regions where the housing and jobs downturn
is most severe.'
Fitch's report 'The Retail Register' reflects Fitch's current
industry outlook for 2008, and provides updated commentary on the
overall retail industry, as well as specific analysis on
individual retail segments, historical financial and same store
sales figures, and other key data points.
Fitch expects U.S. retail industry ratings to be generally stable
in 2008. Despite weakening credit market conditions, which will
likely remain at least through 1H/08, the U.S. retail industry has
ample overall liquidity to meet debt maturities. In 2008,
refinancing activity is expected to be below the $10.8 billion of
debt maturities.
* S&P Cuts Ratings on 95 Tranches From 23 Cash Flows and CDOs
-------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on 95
tranches from 23 U.S. cash flow and hybrid collateralized debt
obligation transactions and placed its ratings on 14 other
tranches on CreditWatch with negative implications. The
downgraded tranches have a total issuance amount of
$4.752 billion.
All of the downgraded tranches come from mezzanine structured
finance CDO of asset-backed securities, high-grade SF CDO of ABS,
or CDO of CDO transactions collateralized either directly or
indirectly by U.S. residential mortgage-backed securities. The
ratings on 37 of the downgraded tranches remain on CreditWatch
with negative implications, indicating a significant likelihood of
further downgrades.
To date, including the CDO tranches listed below and including
actions on both publicly and confidentially rated tranches, S&P
has lowered its ratings on 1,383 tranches from 422 U.S. cash flow,
hybrid, and synthetic CDO transactions as a result of stress in
the U.S. residential mortgage market and credit deterioration of
U.S. RMBS. In addition, 841 ratings from 196
transactions are currently on CreditWatch negative for the same
reasons. In all, the affected tranches represent an issuance
amount of $98.256 billion.
Standard & Poor's will continue to monitor the CDO transactions it
rates and take rating actions, including CreditWatch placements,
when appropriate. Additionally, Standard & Poor's will continue
to review its current criteria assumptions in light of the recent
performance of U.S. RMBS assets and CDOs.
Rating and Creditwatch Actions
Rating
------
Transaction Class To From
----------- ----- -- ----
ACA ABS 2006-2 Ltd. A1LA BB+/Watch Neg AAA/Watch Neg
ACA ABS 2006-2 Ltd. A1LB CC A+/Watch Neg
ACA ABS 2006-2 Ltd. A2L CC BBB-/Watch Neg
ACA ABS 2006-2 Ltd. A3L CC BB-/Watch Neg
ACA ABS 2006-2 Ltd. B1L CC CCC/Watch Neg
Belle Haven ABS CDO Ltd. A1J AA+ AAA/Watch Neg
Belle Haven ABS CDO Ltd. A2 B+ AA/Watch Neg
Belle Haven ABS CDO Ltd. A3 CC A-/Watch Neg
Belle Haven ABS CDO Ltd. Com sec AAA AAA/Watch Neg
Belle Haven ABS CDO Ltd. Sub nts CC BBB-/Watch Neg
Buckingham CDO III Ltd. A ST AAA/Watch Neg A-1+
Buckingham CDO III Ltd. B AAA/Watch Neg AAA
Buckingham CDO III Ltd. C AA/Watch Neg AA
Buckingham CDO III Ltd. D BBB/Watch Neg A/Watch Neg
Buckingham CDO III Ltd. E CC BBB/Watch Neg
Buckingham CDO III Ltd. Income
nts CC BB+/Watch Neg
Citation High Grade ABS
CDO I Ltd A-2 AA+/Watch Neg AAA/Watch Neg
Citation High Grade ABS
CDO I Ltd B-1 A+/Watch Neg AA/Watch Neg
Citation High Grade ABS
CDO I Ltd B-2 BBB+/Watch Neg AA-/Watch Neg
Citation High Grade ABS
CDO I Ltd C BBB-/Watch Neg A/Watch Neg
Citation High Grade ABS
CDO I Ltd D CC BBB/Watch Neg
Diversey Harbor ABS CDO
Ltd. A-2 AA+/Watch Neg AAA/Watch Neg
Diversey Harbor ABS CDO
Ltd. A-3 CCC-/Watch Neg AAA/Watch Neg
Diversey Harbor ABS CDO
Ltd. A-4 CC AA/Watch Neg
Diversey Harbor ABS CDO
Ltd. B CC A/Watch Neg
Diversey Harbor ABS CDO
Ltd. C CC BBB/Watch Neg
Gemstone CDO V Ltd. A-2 AAA/Watch Neg AAA
Gemstone CDO V Ltd. A-3 AA+/Watch Neg AAA/Watch Neg
Gemstone CDO V Ltd. A-4 AA+ /Watch Neg AAA/Watch Neg
Gemstone CDO V Ltd. B BBB+/Watch Neg AA/Watch Neg
Gemstone CDO V Ltd. C BB+/Watch Neg A/Watch Neg
Gemstone CDO V Ltd. D CC BBB/Watch Neg
Gemstone CDO V Ltd. E CC BB/Watch Neg
Independence VI CDO Ltd. A2 AA+ AAA/Watch Neg
Independence VI CDO Ltd. B A+ AA/Watch Neg
Independence VI CDO Ltd. C BBB+ A/Watch Neg
Independence VI CDO Ltd. D BBB- BBB/Watch Neg
Independence VI CDO Ltd E BB+ BBB-/Watch Neg
Lancer Funding Ltd. A1J AA/Watch Neg AAA/Watch Neg
Lancer Funding Ltd. A1S2 AAA/Watch Neg AAA
Lancer Funding Ltd. A2 A+ /Watch Neg AA/Watch Neg
Lancer Funding Ltd. A3 BB+/Watch Neg A/Watch Neg
Lancer Funding Ltd. B CC BBB/Watch Neg
McKinley Funding III Ltd. A-1 AAA/Watch Neg AAA
McKinley Funding III Ltd. A-2 A+/Watch Neg AAA/Watch Neg
McKinley Funding III Ltd. B-1 CCC+/Watch Neg AA/Watch Neg
McKinley Funding III Ltd B-2 CC AA-/Watch Neg
McKinley Funding III Ltd. C CC A/Watch Neg
Mercury CDO II Ltd. B A+ AA-
Mercury CDO II Ltd. C BBB A
Mercury CDO II Ltd. D CCC- BBB/Watch Neg
MKP CBO IV Ltd. B A+ AA/Watch Neg
MKP CBO IV Ltd. C BBB- BBB/Watch Neg
Nautilus RMBS CDO IV Ltd B-F BB+ BBB/Watch Neg
Nautilus RMBS CDO IV Ltd. B-V BB+ BBB/Watch Neg
Nautilus RMBS CDO IV Ltd. C-F CCC- BB/Watch Neg
Nautilus RMBS CDO IV Ltd. C-V CCC- BB/Watch Neg
Orion 2006-1 Ltd. A A/Watch Neg AAA/Watch Neg
Orion 2006-1 Ltd. B BBB+/Watch Neg AA/Watch Neg
Orion 2006-1 Ltd. C CCC+/Watch Neg A/Watch Neg
Orion 2006-1 Ltd. D CC BBB/Watch Neg
Pinnacle Peak CDO I Ltd A1M AAA/Watch Neg AAA
Pinnacle Peak CDO I Ltd A1Q AAA/Watch Neg AAA
Pinnacle Peak CDO I Ltd A2 AAA/Watch Neg AAA
Pinnacle Peak CDO I Ltd. A3 BBB+/Watch Neg AAA/Watch Neg
Pinnacle Peak CDO I Ltd. A4 B/Watch Neg AA/Watch Neg
Pinnacle Peak CDO I Ltd. B CC A+/Watch Neg
Pinnacle Peak CDO I Ltd. C CC A-/Watch Neg
River North CDO Ltd. C A A/Watch Neg
River North CDO Ltd. D-1 BBB- BBB/Watch Neg
River North CDO Ltd. D-2 BBB- BBB/Watch Neg
Rockbound CDO I Ltd. A-1J BBB- AAA/Watch Neg
Rockbound CDO I Ltd. A-1S
fund AA- AAA
Saturn Ventures 2005-1
Ltd. A-2 AA+ AAA
Saturn Ventures 2005-1
Ltd. A-3 BBB- AA/Watch Neg
Saturn Ventures 2005-1
Ltd. B B A-/Watch Neg
Saturn Ventures 2005-1
Ltd. C CC BBB/Watch Neg
Scorpius CDO Ltd. A-1 AAA/Watch Neg AAA
Scorpius CDO Ltd. A-2A A+/Watch Neg AAA/Watch Neg
Scorpius CDO Ltd. A-2B BBB+/Watch Neg AAA/Watch Neg
Scorpius CDO Ltd. B BBB/Watch Neg AA/Watch Neg
Scorpius CDO Ltd. C BB+/Watch Neg AA-/Watch Neg
Scorpius CDO Ltd. D BB/Watch Neg A/Watch Neg
Scorpius CDO Ltd. E CCC+/Watch Neg A-/Watch Neg
Scorpius CDO Ltd. F CC BBB/Watch Neg
Scorpius CDO Ltd. G CC BBB-/Watch Neg
Sharps CDO I Ltd. A-1 AA+ AAA
Sharps CDO I Ltd. A-2 AA+ AAA/Watch Neg
Sharps CDO I Ltd. B A+ AA/Watch Neg
Sharps CDO I Ltd. C BBB- A/Watch Neg
Sharps CDO I Ltd. D CCC+ BBB/Watch Neg
Sharps CDO I Ltd. E CC BB/Watch Neg
Sorin CDO V Ltd. A2 AA AA/Watch Neg
Sorin CDO V Ltd. A3 A- A/Watch Neg
Sorin CDO V Ltd. B BBB- BBB/Watch Neg
Sorin CDO V Ltd. C BB- BB/Watch Neg
Tazlina Funding CDO I
Ltd. D BB+ BBB/Watch Neg
West Trade Funding CDO I
Ltd. A-1 AAA/Watch Neg AAA
West Trade Funding CDO I
Ltd. A-2 AA+/Watch Neg AAA
West Trade Funding CDO I
Ltd. B A+/Watch Neg AA
West Trade Funding CDO I
Ltd. C BBB+/Watch Ne A/Watch Neg
West Trade Funding CDO I
Ltd. D BB+/Watch Neg BBB/Watch Neg
West Trade Funding CDO I
Ltd. E CCC+/Watch Neg BB+/Watch Neg
West Trade Funding II
CDO Ltd. A-1 AAA/Watch Neg AAA
West Trade Funding II
CDO Ltd. A-2 AAA/Watch Neg AAA
West Trade Funding II
CDO Ltd. A-3 AAA/Watch Neg AAA
West Trade Funding II
CDO Ltd. A-4 A+/Watch Neg AAA/Watch Neg
West Trade Funding II
CDO Ltd. B BBB/Watch Neg AA/Watch Neg
West Trade Funding II
CDO Ltd. C BB+/Watch Neg AA-/Watch Neg
West Trade Funding II
CDO Ltd. D CCC+/Watch Neg A/Watch Neg
West Trade Funding II
CDO Ltd. E CC BBB/Watch Neg
West Trade Funding II
CDO Ltd. F CC BB+/Watch Neg
Other Outstanding Ratings
Transaction Class Rating
----------- ----- ------
Belle Haven ABS CDO Ltd. A1SB-1 AAA
Belle Haven ABS CDO Ltd. A1ST AAA
Citation High Grade ABS CDO I Ltd. A-1 AAA
Diversey Harbor ABS CDO Ltd. A-1M AAA
Diversey Harbor ABS CDO Ltd. A-1Q AAA
Gemstone CDO V Ltd. A-1 AAA
Independence VI CDO Ltd. A1 AAA
Lancer Funding Ltd. A1S1 AAA
Mercury CDO II Ltd. A-1 AAA
Mercury CDO II Ltd. A-2 AAA
MKP CBO IV Ltd. A-1 AAA
MKP CBO IV Ltd. A-2 AAA
Nautilus RMBS CDO IV Ltd. A-1J AAA
Nautilus RMBS CDO IV Ltd. A-1S AAA
Nautilus RMBS CDO IV Ltd. A-2 AA
Nautilus RMBS CDO IV Ltd. A-3 A
River North CDO Ltd. A-1 AAA
River North CDO Ltd. A-2 AAA
River North CDO Ltd. B AA
Saturn Ventures 2005-1 Ltd. A-1 AAA
Sorin CDO V Ltd. A1J AAA
Sorin CDO V Ltd. A1S AAA
Tazlina Funding CDO I Ltd. A-1 AAA
Tazlina Funding CDO I Ltd. A-2 AAA
Tazlina Funding CDO I Ltd. B AA
Tazlina Funding CDO I Ltd. C A
* Cozen Forms New Practice Group to Address Credit Market Crisis
----------------------------------------------------------------
Cozen O'Connor has created a new Subprime Credit Markets Practice
Group, bringing a focused offering of integrated legal services to
a market that continues to feel the sting from this global shake-
up.
The unique, multi-disciplinary group of attorneys -- with
expertise in securities and financial services litigation,
securities and real estate law, structured finance, insurance
coverage, bankruptcy and restructuring, and white collar defense -
- will work closely with clients to create effective and
individualized solutions to these challenges, says the firm.
"Like many companies, our clients are affected by the collapse of
the subprime market, and they regularly seek our advice and
representation on a wide range issues related to those events,"
said Thomas A. Decker, President and CEO of Cozen O'Connor. "This
new, focused practice group allows us to draw upon our wealth of
expertise in different disciplines and serve our clients in an
integrated and coordinated fashion."
"The fallout from the current credit crisis will have a very long
tail," continued Decker. "It will touch many different types of
companies, including commercial and consumer lenders, securities
issuers and underwriters, hedge, mutual and other funds, insurers,
investment advisers, and institutional investors. Litigation of
many kinds will result, in addition to restructurings, government
and internal investigations, and new transactions." He added, "We
are a firm that moves quickly as a unit to respond properly to our
clients' needs."
Disciplines of the Subprime Credit Markets Practice Group
1) Litigation
The firm has gained a national reputation representing clients in
a broad spectrum of business and commercial litigation matters in
state and federal trial and before appellate courts and numerous
administrative agencies in jurisdictions throughout the United
States, Canada, South America, Europe, Africa, the Middle East,
and Asia. Due to the firm's wide-range of experience, excellent
reputation, trial advocacy skills, and record of success, it has a
diverse roster of clients who rely on the firm to aggressively
represent them in their high-stakes litigation. Cozen O'Connor
attorneys work closely with clients to implement an innovative,
cost-effective, and, most importantly, successful resolution of
each case.
2) Securities and Financial Services Litigation
The attorneys in Cozen O'Connor's securities and financial
services litigation practice fully understand the threat and
disruption that securities litigation, investor disputes,
regulatory enforcement and similar matters represent to any
business, private or public. These attorneys already represent
clients in litigation related to the subprime mortgage market,
including well-publicized litigation involving certain bond funds
of a leading institutional money manager. The firm's clients
include public and private companies, mutual funds, investment
banks, investment advisers, broker-dealers, and their directors,
executives and trustees. The group regularly handles litigation
under the various securities laws, derivative litigation against
directors and officers, broker-dealer litigation, and mergers and
acquisitions litigation. In addition to appearing in court, the
firm's attorneys appear before regulatory agencies and securities
exchanges, perform internal investigations, and advise management
and boards of directors.
3) Real Estate and Structured Finance
Cozen O'Connor attorneys have expertise in lender, investor and
borrower representations, commercial lending, lease finance,
capital markets transactions, structured finance, project finance,
and debtor-in-possession financings. Its client base is broad and
includes commercial and residential developers, real estate
investment trusts, banks and other lending institutions, brokers,
dealers and investors. The firm also represent entities in
connection with structured and derivative products and in public
finance, including structuring and documenting primary offerings;
counseling issuers and other participants in both the primary and
secondary public markets; and representing bondholders, bond
trustees, bond insurers and borrowers in restructuring or
resolving troubled transactions.
4) Bankruptcy and Restructuring
The firm's bankruptcy, insolvency and restructuring practice
represents clients in a broad range of commercial litigation and
transactional matters, with emphasis in domestic and international
insolvency, creditors' rights, bankruptcy, out-of-court
restructurings, and reorganization. It actively represent
corporate debtors, secured and unsecured creditors, creditors'
committees, trustees, foreign representatives, landlords,
equipment lessors, insurance companies, lenders, and investors in
large Chapter 11 cases throughout the United States. Recognizing
that the adversarial and competitive business environment requires
increasingly creative strategies to avert serious financial
difficulties, members of Cozen O'Connor's Bankruptcy and
Restructuring group are also often called upon to act as key
advisors in the structuring of business and real estate
transactions.
5) Insurance Coverage
Cozen O'Connor has long been regarded as the premier insurance
coverage firm in the United States. The firm focuses on providing
its insurance company clients with objective interpretation of a
wide variety of insurance contracts in the context of legally and
technically complex factual scenarios. It provide our clients
with sound and sophisticated advice on the rights and obligations
of the respective parties to insurance contracts and assist them
in resolving claims in accordance with the contract provisions and
the law. In the event coverage litigation ensues, the firm
vigorously defends its clients' positions. The firm is uniquely
positioned to provide up-to-date coverage advice in multiple
jurisdictions quickly and efficiently. When its clients need
urgent assistance in handling coverage issues in catastrophic or
developing loss situations, Cozen O'Connor is able to call on
lawyers experienced in nearly every U.S. and foreign jurisdiction
to provide solid advice on claims investigation, handling and
coverage specific to the implicated jurisdictions. Cozen O'Connor
maintains an extensive database of multi-jurisdictional case law
on a wide variety of coverage and claims handling issues so that
it can quickly provide critical advice.
6) White Collar Defense
The attorneys in Cozen O'Connor's white collar and complex
criminal defense practice combine vast legal experience and
uncompromising determination to achieve its clients' goals. The
firm's attorneys are recognized leaders in the criminal defense
bar who have each handled high-profile cases for prominent
clients. It prides itself in offering aggressive representation
and a personal approach to solving the most difficult legal
problems. Cozen O'Connor attorneys provide individual and
corporate clients with the best defense available, not only in
criminal jury trials and appeals, but also in all matters
involving state and federal criminal law, including corporate
compliance, securities laws, banking regulations and internal
corporate investigations.
About Cozen O'Connor
A first generation firm founded in 1970, Cozen O'Connor --
http://www.cozen.com/-- has grown from its initial complement of
four attorneys practicing in Philadelphia to 500 attorneys
practicing in 21 national offices and two international offices in
London, England and Toronto, Canada. Ranked among the 100 largest
law firms in the United States, Cozen O'Connor offers legal
services in dozens of practice areas to various corporations and
organizations throughout the world, serving business, insurance,
and private clients.
Due to Cozen O'Connor's excellent reputation for trial advocacy
skills, the firm began acquiring a diverse roster of clients who
relied on its attorneys for their business litigation. At
present, the firm represents clients in a broad spectrum of
general and commercial litigation matters in local, state, and
federal jurisdictions in the United States, as well as Canada,
South America, Europe, Africa, the Middle East, and Asia. Cozen
O'Connor's experienced trial attorneys have litigated cases on
behalf of individuals and business entities in virtually every
industry, and many have tried multimillion-dollar cases to
verdict. The firm has a reputation as one of the most skillful
and resourceful trial law firms in the nation with more than 50
percent of the firm's attorneys having personally tried cases to
verdict in excess of $100,000.
Through focused practice expansion, the firm built a strong
business law practice concentrated in the mid-Atlantic region of
the country. With the resources of a large law firm and the vigor
of a first-generation business, today nearly 50 percent of Cozen
O'Connor's business is non-insurance related, and more than 100 of
the firm's attorneys currently practice in business law. The firm
serves national and international business communities,
representing a broad array of business enterprises, generally in
the range of $5 million to $500 million in annual revenues.
* Data Shows Public Bankruptcy Filings Up in 2007
-------------------------------------------------
BankruptcyData.com, a Boston-based website that tracks business
bankruptcies, recently released data showing a rise in 2007
company bankruptcy filings from 66 to 78 filings last year.
Nevertheless, the survey indicates that the number of filings in
2007 was the fifth lowest since 1980.
The total pre-petition assets of publicly-traded companies in
bankruptcy increased in 2007 to $70,525,653,392 in comparison to
$22,257,549,333 in 2006. Although significant in comparison to
2006, the five largest filings were all in the mortgage and
banking industry.
Public Companies and Assets Filing for Bankruptcy 1980-2007
(Assets in millions)
Year Filings Assets Year Filings Assets
---- ------- ------ ---- ------- ------
1980 62 1,671 1995 85 23,107
1981 74 4,703 1996 86 14,201
1982 84 9,103 1997 83 17,247
1983 89 12,523 1998 122 29,195
1984 121 6,530 1999 145 58,760
1985 149 5,831 2000 179 98,763
1986 149 13,033 2001 263 256,294
1987 112 41,503 2002 220 394,300
1988 122 43,488 2003 172 98,262
1989 135 71,371 2004 92 47,676
1990 115 82,781 2005 86 133,843
1991 123 93,624 2006 66 22,257
1992 91 64,226 2007 78 70,525
1993 86 18,745
1994 70 8,337
Additionally, the PACER Service Center, the Federal Judiciary's
centralized registration, billing and technical support center for
electronic access to U.S. District, Bankruptcy and Appellate court
records, reported that for the twelve-month period ending
September 2007, the total number of all -- both public and private
-- business bankruptcy filings through Sept. 30, 2007 was 25,925
versus 27,333 for the same twelve-month period ending
Sept. 30, 2006.
"While the number of publicly-traded bankruptcies in 2007 remained
relatively low by historical standards," according to George
Putnam, III of New Generation Research, "we expect that number to
rise significantly in 2008. There has been a huge amount of
corporate debt issued over the last several years, much of it
predicated on assumptions of continued economic growth and
abundant liquidity. The liquidity picture has changed
dramatically over the last half of 2007, which by itself should
lead to a substantial increase in defaults and bankruptcies. If
the economy weakens as well, that will boost the default rate even
further."
Date of
Company Filing Total Assets
--------------------------- ---------- ----------------
New Century Financial Corp. 04/02/07 $26,147,090,000
American Home Mortgage 08/06/07 $18,828,985,000
Investment Corp.
HomeBanc Corp. 08/09/07 $6,822,664,000
Delta Financial Corp. 12/17/07 $6,589,127,000
NetBank, Inc. 09/28/07 $4,771,619,000
Movie Gallery, Inc. 10/16/07 $1,385,128,000
Remy International, Inc. 10/08/07 $871,175,000
Pope & Talbot, Inc. 11/19/07 $662,019,000
InSight Health Services 05/29/07 $408,204,000
Holdings Corp.
Bally Total Fitness 07/31/07 $396,771,000
Holding Corp.
The largest filing of 2007 made it into the 10 largest
bankruptcies of all time. New Century Financial is the largest
filing since Calpine Corporation filed in December of 2005.
Date of
Company Filing Total Assets
--------------------------- ---------- ----------------
Worldcom, Inc. 07/21/02 $103,914,000,000
Enron Corporation 12/02/01 $63,392,000,000
Conseco, Inc. 12/18/02 $61,392,000,000
Texaco, Inc. 04/12/87 $35,892,000,000
Refco Inc. 10/17/05 $33,333,172,000
Global Crossing Ltd. 01/28/02 $30,185,000,000
Pacific Gas and Electric Co. 04/06/01 $29,770,000,000
Calpine Corporation 12/20/05 $27,216,088,000
New Century Financial Corp. 04/02/07 $26,147,090,000
UAL Corp. 12/09/02 $25,197,000,000
About BankruptcyData.com
BankruptcyData.com, a division of New Generation Research, Inc. --
http://www.BankruptcyData.com/-- provides news, financial
history, creditor information, reorganization details and more for
over 2,600 publicly-traded companies that have filed for
bankruptcy protection dating back to 1980. The extensive
database, which tracks all publicly-traded bankruptcies, can be
searched by assets, industry, filing date or company name.
BankruptcyData.com also provides instant access to information on
thousands of private business bankruptcy filings from federal
bankruptcy districts. Currently there are over 400,000 business
bankruptcies in the database.
* MBA Reports on 3Q 2007 Mortgage Loan Modification and Repayment
-----------------------------------------------------------------
The mortgage industry modified an estimated 54,000 loans and
established formal repayment plans with another 183,000 borrowers
during the third quarter of 2007, according to a report issued
today by the Mortgage Bankers Association.
By comparison, foreclosure actions were started on approximately
384,000 loans, but of those foreclosures, 63% were cases where the
borrower did not live in the home, the borrower did not respond to
repeated attempts by the lender to contact them, or where the
borrower failed to perform on a repayment plan or loan
modification that was already in place.
"The mortgage industry took major steps during the third quarter
to help those borrowers who could be helped," said Jay Brinkmann,
MBA's Vice President of Research. The numbers of loan
modifications, negotiated repayment plans established, and other
actions to help borrowers are large and compare favorably with the
number of foreclosure actions started, particularly when those
foreclosures are adjusted to remove the borrowers who clearly
could not be helped."
"It is likely that the number of loan modifications for subprime
ARMs will continue to grow through the outreach efforts of the
industry." Mr. Brinkmann continued, "Particularly through the
HopeNOW Alliance that includes counselors, mortgage market
participants and mortgage servicers working together to try and
help avoid foreclosures whenever possible. The U.S. Treasury
Department has played a crucial role in bringing the lending
community together to develop approaches to deal with the current
problems."
For subprime ARM loans there were approximately 13,000 loan
modifications and 90,000 repayment plans established in the third
quarter. For borrowers with subprime fixed-rated loans, loan
servicers instituted 15,000 loan modifications and 30,000
repayment plans.
The report found that while approximately 166,000 foreclosure
actions were started on subprime ARM loans during the third
quarter, approximately 18% of those were on investor-owned
properties, and in 21% of the cases the borrower either could not
be located or would not respond to repeated attempts by the
lenders to contact them. Subprime ARM borrowers who already had a
repayment plan or loan modification in place but were unable to
avoid default anyway accounted for 40% of the subprime ARM
foreclosures.
The MBA report is based on responses from mortgage servicers
covering about 33 million mortgage loans, or approximately 62
percent of the loans outstanding. The numbers are grossed up to
reflect the partial coverage of the market.
While investor-owned properties accounted for 18% of foreclosure
starts for subprime ARM loans in the third quarter, they accounted
for 28% of subprime fixed-rate foreclosure starts, 18% of prime
ARM foreclosure starts and 14 percent of prime fixed-rate
foreclosure starts. In California, the state showing the fastest
increase in foreclosures started, investor-owned properties
accounted for 19% of subprime ARM foreclosure starts and 20% of
subprime fixed-rate foreclosure starts. In Florida, the other
state seeing a rapid increase in foreclosures, investors accounted
for 21% of subprime ARM foreclosures and 27% of subprime fixed-
rate foreclosures.
Cases where the borrower could not be located or would not respond
to attempts by the mortgage servicer to contact them accounted for
21% of subprime ARM foreclosure starts, 21% of subprime fixed-rate
foreclosure starts, 17% of prime ARM foreclosure starts and 33% of
prime fixed-rate foreclosures started.
About Mortgage Bankers Association
The Mortgage Bankers Association --
http://www.mortgagebankers.org/-- is the national association
representing the real estate finance industry, an industry that
employs more than 500,000 people in virtually every community in
the country. Headquartered in Washington, D.C., the association
works to ensure the continued strength of the nation\u2019s
residential and commercial real estate markets; to expand
homeownership and extend access to affordable housing to all
Americans. MBA promotes fair and ethical lending practices and
fosters professional excellence among real estate finance
employees through a wide range of educational programs and a
variety of publications. Its membership of over 3,000 companies
includes all elements of real estate finance: mortgage companies,
mortgage brokers, commercial banks, thrifts, Wall Street conduits,
life insurance companies and others in the mortgage lending field.
* BOND PRICING: For the Week of Jan. 14 - Jan. 18, 2008
-------------------------------------------------------
Issuer Coupon Maturity Price
------ ------ -------- -----
Acme Metals Inc 12.500% 08/01/02 0
Albertson's Inc 6.520% 04/10/28 74
Albertson's Inc 6.530% 04/10/28 74
Albertson's Inc 6.560% 07/26/27 75
Albertson's Inc 6.570% 02/23/28 74
Albertson's Inc 6.630% 06/02/28 75
Aleris Intl Inc 10.0005 12/15/16 70
Alesco Financial 7.625% 05/15/27 69
Allegiance Tel 12.875% 05/15/08 1
Alltel Corp 6.800% 05/01/29 69
Alltel Corp 7.875% 07/01/32 68
Ambac Inc 6.150% 02/15/37 75
Ambassadors Intl 3.750% 04/15/27 71
AMD 6.000% 05/01/15 69
AMD 6.000% 05/01/15 69
AMD 6.000% 05/01/15 67
Amer & Forgn Pwr 5.000% 03/01/30 59
Amer Pad & Paper 13.000% 11/15/05 0
Americredit Corp 0.750% 09/15/11 71
Americredit Corp 2.125% 09/15/13 63
Americredit Corp 2.125% 09/15/13 65
Amer Color Graph 10.000% 06/15/10 54
Ames True Temper 10.000% 07/15/12 55
Antigenics 5.250% 02/01/25 62
Arvinmeritor Inc 4.000% 02/15/27 71
Arvinmeritor Inc 4.000% 02/15/27 72
Ashton Woods USA 9.500% 10/01/15 50
At Home Corp 4.750% 12/15/06 0
Ata Holdings 12.125% 06/15/10 0
Atherogenics Inc 1.500% 02/01/12 8
Atlantic Coast 6.000% 02/15/34 2
Bank New England 8.750% 04/01/99 8
Bank New England 9.500% 02/15/96 14
Bank New England 9.875% 09/15/99 9
Bankunited Cap 3.125% 03/01/34 63
BBN Corp 6.000% 04/01/12 0
Bearingpoint Inc 2.500% 12/15/24 59
Bearingpoint Inc 2.750% 12/15/24 57
Beazer Homes USA 4.625% 06/15/24 70
Beazer Homes USA 6.500% 11/15/13 72
Beazer Homes USA 6.875% 07/15/15 71
Beazer Homes USA 8.125% 06/15/16 74
Bon-Ton Stores 10.250% 03/15/14 73
Borden Inc 7.875% 02/15/23 69
Bowater Inc 6.500% 06/15/13 73
Bowater Inc 9.375% 12/15/21 72
Broder Bros Co 11.250% 10/15/10 72
Budget Group Inc 9.125% 04/01/06 0
Buffet Inc 12.500% 11/01/14 31
Builders Transport 6.500% 05/01/11 0
Burlington North 3.200% 01/01/45 55
Calpine Gener Co 11.500% 04/01/11 17
Capital 1 IV 6.745 02/17/37 70
Capmark Finl Grp 5.875% 05/10/12 74
Cell Genesys Inc 3.125% 11/01/11 74
Central Tractor 10.625% 04/01/07 0
Charming Shoppes 1.125% 05/11/14 71
Charter Comm Inc 6.500% 10/01/27 59
Charter Comm Hld 10.000% 05/15/11 73
CIH 9.920% 04/01/14 59
CIH 10.000% 05/15/14 59
CIH 11.125% 01/15/14 60
CIT Group Inc 6.100% 03/15/67 73
Claire's Stores 9.250% 06/01/15 67
Claire's Stores 10.500% 06/01/17 53
Clear Channel 4.900% 05/15/15 74
Clear Channel 5.500% 09/15/14 73
Clear Channel 5.500% 12/15/16 69
Clear Channel 7.250% 10/15/27 73
CMP Susquehanna 9.875% 05/15/14 71
Collins & Aikman 10.750% 12/31/11 0
Columbia/HCA 7.500% 11/15/95 74
Complete Mgmt 8.000% 08/15/03 0
Complete Mgmt 8.000% 12/15/03 0
Compucredit 3.625% 05/30/25 46
CompuCredit 5.875% 11/30/35 43
Conexant Systems 4.000% 03/01/26 74
Constar Intl 11.000% 12/01/12 75
Cooper-Standard 8.375% 12/15/14 74
Countrywide Cap 8.050% 06/15/27 55
Countrywide Finl 4.500% 06/15/10 72
Countrywide Finl 5.250% 05/11/20 72
Countrywide Finl 5.250% 05/27/20 72
Countrywide Finl 5.750% 01/24/31 73
Countrywide Finl 5.800% 06/07/12 72
Countrywide Finl 5.800% 01/27/31 73
Countrywide Finl 6.000% 03/16/26 73
Countrywide Finl 6.000% 11/14/35 74
Countrywide Finl 6.000% 12/14/35 73
Countrywide Finl 6.000% 02/08/36 73
Countrywide Finl 6.250% 05/15/16 57
Countrywide Home 4.000% 03/22/11 72
Countrywide Home 4.125% 09/15/09 72
Countrywide Home 5.625% 07/15/09 75
Countrywide Home 6.000% 05/16/23 74
Countrywide Home 6.000% 07/23/29 74
Crown Cork & Seal 8.125% 06/15/16 73
Custom Food Prod 8.000% 02/01/07 0
Dana Corp 5.850% 01/15/15 72
Dana Corp 6.500% 03/15/08 70
Dana Corp 6.500% 03/01/09 69
Dana Corp 7.000% 03/15/28 72
Dana Corp 7.000% 03/01/29 72
Dana Corp 9.000% 08/15/11 67
Decode Genetics 3.500% 04/15/11 68
Decode Genetics 3.500% 04/15/11 64
Delta Air Lines 8.000% 12/01/15 61
Delta Mills Inc 9.625% 09/01/07 15
Delphi Corp 6.197 11/15/33 35
Delphi Corp 6.500% 08/15/13 59
Delphi Corp 8.250% 10/15/33 38
Dura Operating 8.625% 04/15/12 10
Dura Operating 9.000% 05/01/09 0
E*trade Finl 7.375% 09/15/13 73
E*trade Finl 7.8755 12/01/15 72
Empire Gas Corp 9.000% 12/31/07 0
Encysive Pharma 2.500% 03/15/12 50
Epix Medical Inc 3.000% 06/15/24 68
Equistar Chemica 7.550% 02/15/26 75
Exodus Comm Inc 4.750% 07/15/08 0
Exodus Comm Inc 11.625% 07/15/10 0
Falcon Products 11.375% 06/15/09 0
Fedders North Am 9.875% 03/01/14 7
Finova Group 7.500% 11/15/09 16
Finlay Fine Jwly 8.375% 06/01/12 56
First Data Corp 4.850% 10/01/14 71
Ford Motor Cred 5.650% 01/21/14 73
Ford Motor Cred 5.750% 01/21/14 72
Ford Motor Cred 5.750% 02/20/14 73
Ford Motor Cred 5.750% 02/20/14 71
Ford Motor Cred 5.900% 02/20/14 74
Ford Motor Cred 6.000% 03/20/14 72
Ford Motor Cred 6.000% 03/20/14 74
Ford Motor Cred 6.000% 03/20/14 74
Ford Motor Cred 6.000% 03/20/14 74
Ford Motor Cred 6.000% 11/20/14 70
Ford Motor Cred 6.000% 11/20/14 72
Ford Motor Cred 6.000% 11/20/14 70
Ford Motor Cred 6.000% 01/20/15 69
Ford Motor Cred 6.000% 02/20/15 72
Ford Motor Cred 6.050% 02/20/14 73
Ford Motor Cred 6.050% 04/21/14 72
Ford Motor Cred 6.050% 12/22/14 70
Ford Motor Cred 6.050% 12/22/14 72
Ford Motor Cred 6.050% 12/22/14 70
Ford Motor Cred 6.050% 02/20/15 72
Ford Motor Cred 6.100% 02/20/15 71
Ford Motor Cred 6.150% 12/22/14 71
Ford Motor Cred 6.200% 04/21/14 73
Ford Motor Cred 6.200% 03/20/15 72
Ford Motor Cred 6.250% 04/21/14 73
Ford Motor Cred 6.250% 01/20/15 70
Ford Motor Cred 6.250% 03/20/15 74
Ford Motor Cred 6.300% 05/20/14 75
Ford Motor Cred 6.300% 05/20/14 73
Ford Motor Cred 6.500% 02/20/15 74
Ford Motor Cred 6.500% 03/20/15 73
Ford Motor Cred 6.650% 06/20/14 75
Ford Motor Cred 6.800% 06/20/14 75
Ford Motor Cred 6.800% 03/20/15 73
Ford Motor Cred 6.850% 05/20/14 74
Ford Motor Cred 7.250% 07/20/17 74
Ford Motor Cred 7.250% 07/20/17 71
Ford Motor Cred 7.350% 09/15/15 75
Ford Motor Cred 7.500% 08/20/32 72
Ford Motor Co 6.375% 02/01/29 65
Ford Motor Co 6.500% 08/01/18 72
Ford Motor Co 6.625% 02/15/28 65
Ford Motor Co 6.625% 10/01/28 66
Ford Motor Co 7.125% 11/15/25 66
Ford Motor Co 7.400% 11/01/46 68
Ford Motor Co 7.450% 07/16/31 73
Ford Motor Co 7.500% 08/01/26 70
Ford Motor Co 7.700% 05/15/97 67
Ford Motor Co 7.750% 06/15/43 68
Franklin Bank 4.000% 05/01/27 69
Freescale Semico 10.125% 12/15/16 73
Frontier Airline 5.000% 12/15/25 73
General Motors 6.750% 05/01/28 65
General Motors 7.375% 05/23/48 65
General Motors 7.400% 09/01/25 71
General Motors 8.100% 06/15/24 73
Georgia Gulf Crp 10.750% 10/15/16 75
GMAC 5.250% 01/15/14 69
GMAC 5.350% 01/15/14 71
GMAC 5.700% 06/15/13 73
GMAC 5.700% 10/15/13 74
GMAC 5.700% 12/15/13 70
GMAC 5.750% 01/15/14 71
GMAC 5.850% 05/15/13 75
GMAC 5.850% 06/15/13 75
GMAC 5.850% 06/15/13 73
GMAC 5.850% 06/15/13 73
GMAC 5.900% 12/15/13 72
GMAC 5.900% 01/15/19 63
GMAC 5.900% 01/15/19 68
GMAC 5.900% 02/15/19 61
GMAC 5.900% 10/15/19 60
GMAC 6.000% 02/15/19 66
GMAC 6.000% 02/15/19 64
GMAC 6.000% 02/15/19 65
GMAC 6.000% 03/15/19 66
GMAC 6.000% 03/15/19 74
GMAC 6.000% 03/15/19 61
GMAC 6.000% 03/15/19 66
GMAC 6.000% 03/15/19 62
GMAC 6.000% 04/15/19 64
GMAC 6.000% 09/15/19 64
GMAC 6.000% 09/15/19 60
GMAC 6.050% 08/15/19 61
GMAC 6.050% 08/15/19 60
GMAC 6.050% 10/15/19 61
GMAC 6.100% 09/15/19 61
GMAC 6.125% 10/15/19 61
GMAC 6.150% 12/15/13 74
GMAC 6.150% 08/15/19 63
GMAC 6.150% 09/15/19 64
GMAC 6.150% 10/15/19 67
GMAC 6.200% 11/15/13 75
GMAC 6.200% 04/15/19 64
GMAC 6.250% 07/15/19 73
GMAC 6.250% 12/15/18 68
GMAC 6.250% 01/15/19 65
GMAC 6.250% 04/15/19 62
GMAC 6.250% 05/15/19 65
GMAC 6.250% 07/15/19 62
GMAC 6.300% 10/15/13 74
GMAC 6.300% 08/15/19 64
GMAC 6.300% 08/15/19 69
GMAC 6.350% 04/15/19 65
GMAC 6.350% 07/15/19 64
GMAC 6.350% 07/15/19 63
GMAC 6.400% 12/15/18 63
GMAC 6.400% 11/15/19 64
GMAC 6.400% 11/15/19 65
GMAC 6.500% 06/15/18 64
GMAC 6.500% 11/15/19 68
GMAC 6.500% 12/15/19 66
GMAC 6.500% 12/15/18 69
GMAC 6.500% 05/15/19 69
GMAC 6.500% 01/15/20 65
GMAC 6.500% 02/15/20 64
GMAC 6.550% 12/15/19 65
GMAC 6.600% 08/15/16 70
GMAC 6.600% 05/15/18 67
GMAC 6.600% 06/15/19 66
GMAC 6.600% 06/15/19 64
GMAC 6.650% 06/15/18 66
GMAC 6.650% 10/15/18 67
GMAC 6.650% 10/15/18 71
GMAC 6.650% 02/15/20 64
GMAC 6.700% 05/15/14 75
GMAC 6.700% 05/15/14 73
GMAC 6.700% 06/15/18 68
GMAC 6.700% 06/15/18 68
GMAC 6.700% 11/15/18 66
GMAC 6.700% 06/15/19 66
GMAC 6.700% 12/15/19 66
GMAC 6.750% 07/15/16 70
GMAC 6.750% 08/15/16 71
GMAC 6.750% 09/15/16 71
GMAC 6.750% 06/15/17 73
GMAC 6.750% 03/15/18 66
GMAC 6.750% 07/15/18 68
GMAC 6.750% 09/15/18 66
GMAC 6.750% 10/15/18 66
GMAC 6.750% 11/15/18 68
GMAC 6.750% 05/15/19 69
GMAC 6.750% 05/15/19 67
GMAC 6.750% 06/15/19 70
GMAC 6.750% 06/15/19 67
GMAC 6.750% 03/15/20 75
GMAC 6.800% 09/15/18 65
GMAC 6.800% 10/15/18 66
GMAC 6.850% 05/15/18 75
GMAC 6.875% 08/15/16 70
GMAC 6.875% 07/15/18 69
GMAC 6.900% 06/15/17 69
GMAC 6.900% 07/15/18 71
GMAC 6.900% 08/15/18 72
GMAC 6.950% 06/15/17 73
GMAC 7.000% 06/15/17 68
GMAC 7.000% 07/15/17 69
GMAC 7.000% 02/15/18 66
GMAC 7.000% 02/15/18 69
GMAC 7.000% 02/15/18 69
GMAC 7.000% 03/15/18 70
GMAC 7.000% 05/15/18 72
GMAC 7.000% 08/15/18 69
GMAC 7.000% 09/15/18 70
GMAC 7.000% 02/15/21 65
GMAC 7.000% 09/15/21 67
GMAC 7.000% 09/15/21 68
GMAC 7.000% 06/15/22 66
GMAC 7.000% 11/15/23 69
GMAC 7.000% 11/15/24 66
GMAC 7.000% 11/15/24 67
GMAC 7.000% 11/15/24 66
GMAC 7.050% 03/15/18 69
GMAC 7.050% 03/15/18 70
GMAC 7.050% 04/15/18 69
GMAC 7.125% 10/15/17 71
GMAC 7.150% 09/15/18 68
GMAC 7.150% 01/15/25 67
GMAC 7.150% 03/15/25 70
GMAC 7.200% 10/15/17 71
GMAC 7.200% 10/15/17 71
GMAC 7.250% 09/15/17 74
GMAC 7.250% 09/15/17 72
GMAC 7.250% 09/15/17 72
GMAC 7.250% 09/15/17 72
GMAC 7.250% 01/15/18 73
GMAC 7.250% 04/15/18 70
GMAC 7.250% 04/15/18 72
GMAC 7.250% 08/15/18 71
GMAC 7.250% 09/15/18 70
GMAC 7.250% 01/15/25 68
GMAC 7.250% 02/15/25 70
GMAC 7.250% 03/15/25 68
GMAC 7.300% 12/15/17 72
GMAC 7.300% 01/15/18 72
GMAC 7.300% 01/15/18 72
GMAC 7.375% 11/15/16 74
GMAC 7.375% 04/15/18 70
GMAC 7.400% 12/15/17 71
GMAC 7.500% 11/15/16 75
GMAC 7.500% 08/15/17 72
GMAC 7.500% 11/15/17 71
GMAC 7.500% 03/15/25 74
GMAC 7.750% 10/15/17 74
GMAC 8.000% 10/15/17 75
GMAC 8.000% 11/15/17 74
Greenbrier Cos 2.375% 05/15/26 66
Gulf Mobile Ohio 5.000% 12/01/56 73
Gulf States STL 13.500% 04/15/03 0
Harrahs Oper Co 5.625% 06/01/15 73
Harrahs Oper Co 5.750% 10/01/17 69
Harrahs Oper Co 6.500% 06/01/16 74
Headwaters Inc 2.500% 02/01/14 74
Headwaters Inc 2.500% 02/01/14 73
Hercules Inc 6.500% 06/30/29 74
Herbst Gaming 7.000% 11/15/14 59
Herbst Gaming 8.125% 06/01/12 64
Hills Stores Co 12.500% 07/01/03 0
Hilton Hotels 7.500% 12/15/17 74
Hines Nurseries 10.250% 10/01/11 75
HNG Internorth 9.625% 03/15/06 19
Huntington Natl 5.375% 02/28/19 74
Ikon Office 6.750% 12/01/25 74
Interdent Svc 10.750% 12/15/11 70
Ion Media 11.000% 07/31/13 55
Iridium LLC/CAP 10.875% 07/15/05 1
Iridium LLC/CAP 11.250% 07/15/05 2
Iridium LLC/CAP 13.000% 07/15/05 1
Iridium LLC/CAP 14.000% 07/15/05 1
JP Morgan Chase 12.000% 07/31/08 62
K Hovnanian Entr 6.250% 01/15/15 68
K Hovnanian Entr 6.250% 01/15/16 67
K Hovnanian Entr 6.375% 12/15/14 68
K Hovnanian Entr 6.500% 01/15/14 70
K Hovnanian Entr 7.500% 05/15/16 68
K Hovnanian Entr 7.750% 05/15/13 55
K Hovnanian Entr 8.000% 04/01/12 71
K Hovnanian Entr 8.625% 01/15/17 72
K Hovnanian Entr 8.875% 04/01/12 57
K Mart Funding 8.800% 07/01/10 9
Kaiser Aluminum 9.875% 02/15/02 0
Kaiser Aluminum 12.750% 02/01/03 4
Keystone Auto Op 9.750% 11/01/13 65
Kimball Hill Inc 10.500% 12/15/12 32
Kmart Corp 8.540% 01/02/15 0
Kmart Corp 9.350% 01/02/20 5
Kmart Corp 9.780% 01/05/20 0
Knight Ridder 4.625% 11/01/14 75
Knight Ridder 5.750% 09/01/17 73
Knight Ridder 6.875% 03/15/29 69
Kulicke & Soffa 0.875% 06/01/12 72
Lehman Bros Holding 9.500% 05/01/08 75
Leiner Health 11.000% 06/01/12 65
Lennar Corp 5.500% 09/01/14 75
Lennar Corp 5.6005 05/31/15 75
Lennar Corp 6.500% 04/15/16 75
Liberty Media 3.250% 03/15/31 74
Liberty Media 3.750% 02/15/30 57
Liberty Media 4.000% 11/15/29 63
Lifecare Holding 9.250% 08/15/13 65
LTV Corp 8.200% 09/15/07 0
Magna Entertainm 7.250% 12/15/09 72
Majestic Star 9.750% 01/15/11 69
Masonite Corp 11.000% 04/06/15 74
MBIA Inc 5.700% 12/01/34 66
McSaver Financl 7.400% 02/15/02 0
McSaver Financl 7.875% 08/01/03 1
MediaNews Group 6.375% 04/01/14 62
Meritage Corp 7.000% 05/01/14 72
Meritage Homes 6.250% 03/15/15 69
Metaldyne Corp 11.000% 06/15/12 60
Micron Tech 1.875% 06/01/14 74
Millenium Amer 7.625% 11/15/26 75
Morris Publish 7.000% 08/01/13 72
Movie Gallery 11.000% 05/01/12 29
Mrs Fileds 9.000% 03/15/11 74
Muzak LLC 9.875% 03/15/09 53
Natl Steel Corp 8.375% 08/01/06 0
Neff Corp 10.000% 06/01/15 54
New Orl Grt N RR 5.000% 07/01/32 60
New Plan Excel 5.250% 09/15/15 75
New Plan Realty 6.900% 02/15/28 41
New Plan Realty 7.680% 11/02/26 41
North Atl Trading 9.250% 03/01/12 71
Northern Pacific RY 3.000% 01/01/47 51
Northern Pacific RY 3.000% 01/01/47 51
Northwest Steel & Wire 9.500% 06/15/01 0
NTK Holdings Inc 10.750% 03/01/14 58
Nutritional Src 10.125% 08/01/09 2
Nuveen Invest 5.500% 09/15/15 69
Oakwood Homes 8.125% 03/01/19 0
Ocwen Financial 3.250% 08/01/24 72
Omnicare Inc 3.250% 12/15/35 73
Oscient Pharma 3.500% 04/15/11 44
Outback Steakhse 10.0005 06/15/15 66
Outboard Marine 7.000% 07/01/02 0
Outboard Marine 9.125% 04/15/17 7
Pac-West Telecom 13.500% 02/01/09 4
Pac-West Telecom 13.500% 02/01/09 1
Palm Harbor 3.250% 05/15/24 72
Pegasus Satellite 12.375% 08/01/08 0
Phar-Mor Inc 11.720% 12/31/49 0
Phelps Dodge 6.125% 03/15/34 72
Piedmont Aviat 10.250% 01/15/49 0
Pierre Foods Inc 9.875% 07/15/12 70
Pixelworks Inc 1.750% 05/15/24 71
Ply Gem Indust 9.000% 02/15/12 72
Pope & Talbot 8.375% 06/01/13 17
Pope & Talbot 8.375% 06/01/13 19
Portola Packagin 8.250% 02/01/12 74
Powerwave Tech 1.875% 11/15/24 69
Powerwave Tech 3.875% 10/01/27 67
Primus Telecom 3.750% 09/15/10 59
Primus Telecom 8.000% 01/15/14 55
Propex Fabrics 10.000% 12/01/12 40
PSInet Inc 10.000% 02/15/05 0
PSInet Inc 10.500% 12/01/06 0
Pulte Homes Inc 6.000% 02/15/35 74
Pulte Homes Inc 6.375% 05/15/33 75
Radnor Holdings 11.000% 03/15/10 0
Railworks Corp 11.500% 04/15/09 0
Rait Financial 6.875% 04/15/27 65
Rayovac Corp 8.500% 10/01/13 65
Read-Rite Corp 6.500% 09/01/04 0
Realogy Corp 12.375% 04/15/15 75
Realogy Corp 12.375% 04/15/15 61
Restaurant Co 10.000% 10/01/13 71
Residential Cap 6.000% 02/22/11 61
Residentail Cap 6.375% 06/30/10 66
Residential Cap 6.500% 06/01/12 63
Residential Cap 6.500% 04/17/13 61
Residential Cap 6.875% 06/30/15 60
RF Micro Devices 1.000% 04/15/14 71
RF Micro Devices 1.000% 04/15/09 1
Rite Aid Corp. 6.875% 08/15/13 70
Rite Aid Corp. 7.700% 02/15/27 67
RJ Tower Corp. 12.000% 06/01/13 4
S3 Inc 5.750% 10/01/03 0
ServiceMaster Co 7.100% 03/01/18 67
ServiceMaster Co 7.250% 03/01/38 70
ServiceMaster Co 7.450% 08/15/27 72
Six Flags Inc 4.500% 05/15/15 71
Six Flags Inc 9.625% 06/01/14 74
SLM Corp 4.700% 12/15/28 69
SLM Corp 4.800% 12/15/28 61
SLM Corp 5.000% 06/15/19 73
SLM Corp 5.000% 06/15/19 71
SLM Corp 5.000% 09/15/20 68
SLM Corp 5.000% 12/15/28 71
SLM Corp 5.050% 03/15/23 73
SLM Corp 5.190% 04/24/19 73
SLM Corp 5.200% 03/15/28 65
SLM Corp 5.250% 03/15/28 75
SLM Corp 5.250% 12/15/28 61
SLM Corp 5.350% 06/15/28 69
SLM Corp 5.400% 03/15/23 66
SLM Corp 5.400% 03/15/28 70
SLM Corp 5.400% 06/15/30 67
SLM Corp 5.450% 06/15/28 72
SLM Corp 5.450% 06/15/28 64
SLM Corp 5.500% 03/15/19 73
SLM Corp 5.500% 06/15/29 72
SLM Corp 5.500% 06/15/29 64
SLM Corp 5.500% 06/15/29 66
SLM Corp 5.500% 06/15/29 64
SLM Corp 5.500% 03/15/30 66
SLM Corp 5.500% 06/15/30 65
SLM Corp 5.500% 06/15/30 66
SLM Corp 5.500% 06/15/30 68
SLM Corp 5.500% 06/15/30 64
SLM Corp 5.500% 12/15/30 69
SLM Corp 5.550% 06/15/25 71
SLM Corp 5.550% 06/15/28 72
SLM Corp 5.550% 03/15/29 74
SLM Corp 5.600% 03/15/22 72
SLM Corp 5.600% 12/15/28 71
SLM Corp 5.600% 03/15/29 63
SLM Corp 5.600% 03/15/29 70
SLM Corp 5.600% 06/15/29 66
SLM Corp 5.600% 12/15/29 66
SLM Corp 5.600% 12/15/29 68
SLM Corp 5.625% 01/25/25 71
SLM Corp 5.650% 06/15/22 72
SLM Corp 5.650% 06/15/22 72
SLM Corp 5.650% 03/15/29 63
SLM Corp 5.650% 03/15/29 75
SLM Corp 5.650% 03/15/29 70
SLM Corp 5.650% 12/15/29 71
SLM Corp 5.650% 12/15/29 67
SLM Corp 5.650% 12/15/29 68
SLM Corp 5.650% 03/15/30 66
SLM Corp 5.650% 09/15/30 74
SLM Corp 5.650% 03/15/32 71
SLM Corp 5.700% 03/15/29 64
SLM Corp 5.700% 03/15/29 67
SLM Corp 5.700% 03/15/29 65
SLM Corp 5.700% 03/15/29 68
SLM Corp 5.700% 12/15/29 75
SLM Corp 5.700% 03/15/30 66
SLM Corp 5.700% 03/15/32 72
SLM Corp 5.750% 03/15/29 70
SLM Corp 5.750% 03/15/29 73
SLM Corp 5.750% 03/15/29 67
SLM Corp 5.750% 06/15/29 71
SLM Corp 5.750% 09/15/29 67
SLM Corp 5.750% 12/15/29 68
SLM Corp 5.750% 12/15/29 68
SLM Corp 5.750% 12/15/29 67
SLM Corp 5.750% 12/15/29 66
SLM Corp 5.750% 03/15/30 65
SLM Corp 5.750% 03/15/30 68
SLM Corp 5.750% 06/15/32 72
SLM Corp 5.750% 06/15/32 72
SLM Corp 5.800% 12/15/29 70
SLM Corp 5.800% 03/15/32 72
SLM Corp 5.800% 03/15/32 72
SLM Corp 5.800% 03/15/32 68
SLM Corp 5.850% 09/15/29 72
SLM Corp 5.850% 09/15/29 67
SLM Corp 5.850% 12/15/31 70
SLM Corp 5.850% 03/15/32 73
SLM Corp 5.850% 03/15/32 73
SLM Corp 5.850% 03/15/32 73
SLM Corp 5.850% 06/15/32 73
SLM Corp 5.850% 06/15/32 73
SLM Corp 6.000% 06/15/26 74
SLM Corp 6.000% 06/15/26 69
SLM Corp 6.000% 12/15/26 73
SLM Corp 6.000% 12/15/26 75
SLM Corp 6.000% 03/15/27 73
SLM Corp 6.000% 12/15/28 70
SLM Corp 6.000% 12/15/28 75
SLM Corp 6.000% 03/15/29 70
SLM Corp 6.000% 06/15/29 70
SLM Corp 6.000% 06/15/29 75
SLM Corp 6.000% 06/15/29 70
SLM Corp 6.000% 09/15/29 71
SLM Corp 6.000% 09/15/29 73
SLM Corp 6.000% 09/15/29 71
SLM Corp 6.000% 06/15/31 68
SLM Corp 6.000% 12/15/31 61
SLM Corp 6.000% 12/15/31 67
SLM Corp 6.000% 03/15/37 73
SLM Corp 6.000% 03/15/37 73
SLM Corp 6.000% 03/15/37 73
SLM Corp 6.050% 12/15/26 72
SLM Corp 6.050% 12/15/31 72
SLM Corp 6.100% 09/15/31 75
SLM Corp 6.100% 12/15/31 69
SLM Corp 6.150% 09/15/29 71
SLM Corp 6.200% 09/15/26 75
SLM Corp 6.200% 12/15/31 69
SLM Corp 6.250% 06/15/29 71
SLM Corp 6.250% 06/15/29 70
SLM Corp 6.250% 06/15/29 71
SLM Corp 6.250% 09/15/29 70
SLM Corp 6.250% 09/15/29 73
SLM Corp 6.300% 09/15/31 74
SLM Corp 6.350% 06/15/31 74
SLM Corp 6.400% 09/15/31 72
SLM Corp 6.450% 09/15/31 70
SLM Corp 6.500% 09/15/31 72
Spacehab Inc 5.500% 10/15/10 50
Spansion Llc 2.250% 06/15/16 53
Special Devises 11.375% 12/15/08 66
Spectrum Brands 7.375% 02/01/15 73
Standard Pac Corp 6.000% 10/01/12 61
Standard Pac corp 6.250% 04/01/14 65
Standard Pacific 6.500% 08/15/10 67
Standard Pac Corp 6.875% 05/15/11 67
Standard Pacific 7.000% 08/15/15 66
Standard Pac corp 7.750% 03/15/13 66
Standard Pacific 9.250% 04/15/12 46
Stanley-Martin 9.750% 08/15/15 65
Station Casinos 6.500% 02/01/14 74
Station Casinos 6.625% 03/15/18 69
Station Casinos 6.875% 03/01/16 72
Tech Olympic 8.250% 04/01/11 42
Tekni-Plex Inc 12.750% 06/15/10 69
Teligent Inc 11.500% 12/01/07 0
Tenet Healthcare 6.875% 11/15/31 74
Times Mirror Co 6.610% 09/15/27 56
Times Mirror Co 7.250% 03/01/13 69
Times Mirror Co 7.250% 11/15/96 52
Times Mirror-New 7.500% 07/01/23 59
Tom's Foods Inc 10.500% 11/01/04 1
Tops Appliance 6.500% 11/30/03 0
Tousa Inc 7.500% 03/15/11 8
Tousa Inc 7.500% 01/15/15 8
Tousa Inc 9.000% 07/01/10 43
Tousa Inc 9.000% 07/01/10 42
Tousa Inc 10.375% 07/01/12 8
Toys R Us 7.375% 10/15/18 71
Trans Mfg Oper 11.250% 05/01/09 60
TransTexas Gas 15.000% 03/15/05 0
Tribune Co 4.875% 08/15/10 68
Tribune Co 5.250% 08/15/15 56
Trism Inc 12.000% 02/15/05 0
True Temper 8.375% 09/15/11 61
Trump Entertnmnt 8.5005 06/01/15 71
TXU Corp 6.500% 11/15/24 73
TXU Corp 6.550% 11/15/34 72
Unifi Inc 11.500% 05/15/14 74
United Air Lines 9.210% 01/21/17 0
United Air Lines 9.300% 03/22/08 50
United Air Lines 10.850% 02/19/15 31
Universal Standard 8.250% 02/01/06 0
US Air Inc. 10.250% 01/15/49 0
US Air Inc. 10.300% 07/15/49 0
US Air Inc. 10.550% 01/15/49 0
US Air Inc. 10.550% 01/15/49 0
US Air Inc. 10.700% 01/01/49 0
US Air Inc. 10.700% 01/15/49 0
US Air Inc. 10.750% 01/15/49 0
US Air Inc. 10.800% 01/01/49 0
US Air Inc. 10.800% 01/01/49 0
US Air Inc. 10.800% 01/01/49 0
US Air Inc. 10.900% 01/01/49 0
US Air Inc. 10.900% 01/01/49 0
Vertis Inc 10.875% 06/15/09 61
Vesta Insur Grp 8.750% 07/15/25 2
Vicorp Restaurant 10.500% 04/15/11 64
Vion Pharm Inc 7.750% 02/15/12 67
Visteon Corp 7.000% 03/10/14 74
Wachovia Corp 9.250% 04/10/08 41
Wachovia Corp 12.500% 03/05/08 43
Washington Mutual Pfd 6.534% 03/29/49 59
Washington Mutual Pfd 6.895% 06/29/49 60
WCI Communities 4.000% 08/05/23 70
WCI Communities 6.625% 03/15/15 50
WCI Communities 7.875% 10/01/13 54
WCI Communities 9.125% 05/01/12 56
Werner Holdings 10.000% 11/15/07 0
Westpoint Steven 7.875% 06/15/05 0
William Lyon 7.500% 02/15/14 59
William Lyon 7.625% 12/15/12 62
William Lyon 10.750% 04/01/13 61
Wimar Op LLC/Fin 9.625% 12/15/14 62
Winstar Comm Inc 12.500% 04/15/08 0
Winstar Comm Inc 12.750% 04/15/10 0
Winstar Comm 14.000% 10/15/05 0
Wornick Co 10.875% 07/15/11 64
Young Broadcasting 8.750% 01/15/14 71
Ziff Davis Media 12.000% 08/12/09 22
*********
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, Philline P. Reluya, Joseph Medel C.
Martirez, and Peter A. Chapman, Editors.
Copyright 2008. All rights reserved. ISSN: 1520-9474.
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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.
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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 ***