T R O U B L E D C O M P A N Y R E P O R T E R Monday, March 3, 2008, Vol. 12, No. 53 Headlines 44 BRUSHY NECK: Voluntary Chapter 11 Case Summary 1025 ROUTE 17M: Case Summary & Five Largest Unsecured Creditors AAMES MORTGAGE: Adverse Performance Cues S&P's Rating Downgrades AGILYSIS INC: Amends Credit, Inventory Financing Agreements ALION SCIENCE: 10Q Filing Delay Cues S&P's Negative Watch Listing AMBAC FINANCIAL: Moody's Reviews 'Aaa' Rating For Likely Downgrade AMBAC FINANCIAL: CEO Glad with Moody's Comment; to Cut Dividend AMBAC FINANCIAL: Receives Subpoena from Massachusetts AMBAC FINANCIAL: Faces New Competition from Berkshire Unit AMERICAN AXLE: Union Members Rally to Preserve Well-Paying Jobs AMERICAN MEDICAL: Moody's Holds B1 Rating; Gives Negative Outlook AMERICHIP INTERNATIONAL: Completes Acquisition of KSI Machine AMERIMAC PROPERTIES: Case Summary & Largest Unsecured Creditor AMERIQUEST MORTGAGE: Two Classes Get S&P's Junk Ratings ANSLEY PARK: Five Classes of Notes Obtain Moody's Junk Ratings ASSOCIATED MATERIALS: Names Cynthia L. Sobe Vice Pres.-CFO ATLANTIC COAST: Case Summary & 20 Largest Unsecured Creditors AURIGA CDO: Poor Credit Quality Prompts Moody's Rating Downgrades AXCAN INTERMEDIATE: S&P Puts 'BB-' Rating on $518 Mil. Senior Debt AXCAN PHARMA: Canada Industry Regulator OKs $1.3 Bil. Sale to TPG BANC OF AMERICA: Stable Performance Cues Fitch to Affirm Ratings BAPTIST HEALTH: Moody's Puts 'Ba2' Debt Rating on Watchlist BMO FINANCIAL: To Write Down CA$495 Million Over Trusts' Mishap BMO FINANCIAL: Discloses Financial Updates for First Quarter 2008 BMO FINANCIAL: Senior Management Changes to Take Effect March 5 BRETT LONG: Voluntary Chapter 11 Case Summary BRITT METAL: Case Summary & 18 Largest Unsecured Creditors CA INC: Will Pay $0.04 Per Share Dividend on March 28 CABLEVISION SYSTEMS: In Talks with Ticketmaster to Buy AEG Stake CENVEO INC: Expects to File Annual Financial Report on March 13 CENVEO INC: 10K Filing Delay Will Not Affect S&P's 'BB-' Rating CHARYS HOLDING: Asks Court to Extend Schedules Deadline to June 14 CHARYS HOLDING: Taps Weil Gotshal & Manges as Bankruptcy Counsel CHARYS HOLDING: Obtains Authority to Employ KCC as Claims Agent CHASE FUNDING: S&P Chips Rating on Class IM-2 Certificates to 'BB' CHE TAING: Case Summary & 10 Largest Unsecured Creditors CNS RESPONSE: Posts $1,008,800 Net Loss in 1st Qtr. Ended Dec. 31 CONSOL ENERGY: Registers Proposed Exchange Offer for CNX Shares CONSTELLATION BRANDS: Completes $134 Million Sale of Wine Brands COPELAND LUMBER: Shuts Down Operations and Lays Off 17 Workers COTT CORP: In Talks with Wal-Mart on Shelf Space Allocation COTT CORP: Unable to Meet Deadline; Delays Filing of Form 10-K COTT CORP: Moody's Puts 'B1' Rating on Review for Possible Cut COUNTRYWIDE FINANCIAL: BofA Urged to Explain Sambol's Appointment COUNTRYWIDE FINANCIAL: USTP Complains on Alleged Bankruptcy Abuses CROWN HOLDINGS: Discloses Revisions in Tax Valuation Allowance CUNY: Hit with High Interest in Auction Rate Bonds; Mulls Options CYBERCARE INC: Creditors Cry Foul on Disclosure Statement CATHOLIC CHURCH: Davenport and Panel Want Tort Claims Estimated CATHOLIC CHURCH: Davenport's Ex-Priest Jailed for Contempt CATHOLIC CHURCH: Davenport Tells Parishes To Help Pay Settlement DAVID SCHWARTZ: Case Summary & 8 Largest Unsecured Creditors DELTA AIR: Pilots Union Poses Threat to Northwest Tie-Up DELTA FUNDING: S&P Junks Rating on Class M-2 Certificate From 'BB' DOBI MEDICAL: Judge Gambardella Confirms Chapter 11 Plan EMISPHERE TECH: Sells Certain Patents to MannKind for $2.5 Million ENERGAS RESOURCES: Sells Properties in Laurel and Whitley Counties ENERGY PARTNERS: Weak Productivity Cues Moody's Junk Corp. Rating ENERSYS INC: Holders Agree to Sell 5 Million Shares Goldman Sachs ENTRAVISION COMM: Selling Outdoor Advertising Optns. for $100 Mil. FIRST FRANKLIN: S&P Downgrades Ratings on 29 Classes of Certs. FIRST FRANKLIN: Fitch Lowers Ratings on $3.5 Billion Certificates FORD MOTOR: Supplier Navistar Re-Files Breach of Contract Lawsuit FORTUNOFF: 13 Creditors Request the Return of Goods FORTUNOFF: Wants to Close Sale Before Paying Rent to El-Kam FREMONT GENERAL: Audit Completion Delays Annual Report Filing FRESH DEL MONTE: Earns $179.8 Million in Fiscal Year 2007 GENERAL MOTORS: To Idle More Plants As Supplier's UAW Talks Resume GENOIL INC: Appoints David A. Johnson to Board of Directors GENOIL INC: To Conduct $2 Million Private Placement of Units GO LOGISTICS: Case Summary & 15 Largest Unsecured Creditors HANGER ORTHOPEDIC: Expands Presence with Five Medical Unit Buyouts HANLEY WOOD: S&P Changes Outlook to Negative on Weak Operations HE&PG REALTY: Case Summary & 12 Largest Unsecured Creditors HHGREGG INC: Moody's Lifts Corp. Family Rating to 'Ba3' From 'B1' IMPAC MORTGAGE: Board Appoints Todd Taylor as Interim CFO INDEPENDENCE V: Moody's Downgrades Ratings on Weak Credit Quality INSMED INC: Securities Listing Transferred to Nasdaq Capital INTEGRATED HEALTHCARE: Has $47.1 Million Equity Deficit at Dec. 31 INTEGRATED SECURITY: Dec. 31 Balance Sheet Upside-Down by $10.7 M. IAC/INTERACTIVECORP: Unit Teams with Cablevision to Buy AEG Stake INTERSTATE HOTELS: To Correct Errors in Financial Statement ISTAR FINANCIAL: Moody's Confirms Preferred Stock Rating at 'Ba1' JP MORGAN: Fitch Downgrades Ratings on $3.8 Billion Certificates JPMORGAN AUTO: Fitch Affirms 'BB' Rating on Asset-Backed Certs. KEITH SCHEINBLUM: Case Summary & 10 Largest Unsecured Creditors LAMAR ADVERTISING: Inks $100 Mil. Deal to Buy Outdoor Ad Biz LAWRENCE SALANDER: Judge Denies Bid to be Hired in Auction LAZARD LTD: Gets Okay for Additional $100 Mil. Share Repurchase LEVITT AND SONS: 21 Deposit Holders Can File Claims on March 28 LEVITT AND SONS: Wachovia Bank & Debtors Oppose Case Dismissal LEVITT AND SONS: Phillips and Jordan Wants DIP Order Reversed LONGRIDGE ABS: Moody's Junks Rating on $85 Mil. Notes From 'Aaa' M-1 SPC: Moody's Withdraws 'Ba2' Rating on Amendment Execution MARK KIZZIA: Case Summary & 19 Largest Unsecured Creditors MEDIANEWS GROUP: S&P Assigns 'B' Rating on Negative CreditWatch MEDICOR LTD: Mediation with Southwest Receiver Set for March 26 MERIDIAN BAINBRIDGE: Voluntary Chapter 11 Case Summary MEZZ CAP: Fitch Holds 'B' Rating on $3.9 Million Class H Certs. NASDAQ OMX: Names New Board of Directors NATIONAL CITY: Fitch Rates Two Certificate Classes at B NATIONWIDE HEALTH: David Snyder Resigns as VP and Controller NAVISTAR INTERNATIONAL: Re-Files Breach of Contract vs. Ford Motor NEWPARK RESOURCES: Moody's Vacates All Ratings on Business Reasons NORTHWEST AIR: Pilots Union Poses Threat to Delta Air Tie-Up NOTIFY TECH: December 31 Balance Sheet Upside-Down by $1,065,812 NUTRITIONAL SOURCING: Exclusive Plan Filing Period Extended NUTRITIONAL SOURCING: Court Approves Sale Bidding Procedure OMEGA HEALTHCARE: Fitch Withdraws Ratings with Stable Outlook ORBIT BRANDS: Court Dismisses Chapter 11 Bankruptcy Case PACIFIC LUMBER: Bank of New York Files Amended Chapter 11 Plan PACIFIC LUMBER: Various Parties Attack Panel Disclosure Statement PACIFIC LUMBER: BoNY Wants Voting for PALCO Plan Cancelled PACIFIC LUMBER: BofA Blocks Move to Increase SAR Withdrawals Cap PACKAGING CORP: Moody's Upgrades Senior Debt Ratings From 'Ba1' PAINE WEBBER: Moody's Confirms Junk Ratings on Two Cert. Classes PINNACLE WEST: Voluntary Chapter 11 Case Summary PLAINS EXPLORATION: Earnings Down to $80MM in Qtr. Ended Dec. 31 PROPEX INC: Section 341 Meeting of Creditor Scheduled for March 11 PROPEX INC: Wants Court Nod on Sale Procedures of Dalton Property PROPEX INC: Wants Court Nod on Sale Procedures of Dalton Property PROVIDENTIAL HOLDINGS: Inks Business Deal with Russia's CCIC QUIGLEY CO: Judge Allows All Asbestos Claimants to Vote on Plan REAL ESTATE ASSET: Moody's Keeps Low-B Ratings on 6 Cert. Classes RH DONNELLEY: Fitch Not Concerned on "Operating Softness" RORY SCOTT: Case Summary & 12 Largest Unsecured Creditors SAINT VINCENT: Inks Pact with Highland to Extend Lien Period SALANDER-O'REILLY: Judge Denies Owner's Bid to be Hired in Auction SARAH TRICARICO: Case Summary & Three Largest Unsecured Creditors SCHOONER TRUST: Moody's Confirms Low-B Ratings on Six Classes SEARS HOLDINGS: Restoration Deems Merger Proposal Inferior SENTINEL MANAGEMENT: Balks at $6.1 Million in Professionals' Fees SOLUTIA INC: Obtains Court's Nod on Akzo Nobel Settlement Pact SOLUTIA INC: Can Assume Wal-Mart Contracts Under Terms of Plan SOLUTIA INC: Can Pay DTE $773,364 to Cure PrePetition Default SOLUTIA INC: Moody's Designates 'B2' Rating on $400 Mil. Facility SPRINT NEXTEL: Offers New Service Plan Amid Huge 4th Quarter Loss STALLION OILFIELD: Tight Liquidity Prompts S&P's Negative Outlook STRUCTURED ASSET: Moody's Downgrades Ratings on 23 Cert. Classes TAXABLE WORLD: Moody's Downgrades Ratings on Revenue Bonds to Ba1 TRICOM SA: Files for Bankruptcy Protection in New York TRICOM SA: Case Summary & 14 Largest Unsecured Creditors TENET HEALTHCARE: Posts $75 Mil. Net Loss in 2007 Fourth Quarter TOUSA INC: Subsidiary Enters Into Joint Venture with Wells Fargo TOUSA INC: To Sell Note to PRN Real Estate for $13,500,000 TOUSA INC: To Pay $4-Mil. in Deferred Compensation Obligations TOUSA INC: Asks Court to Approve Berkowitz Amended Agreement TOUSA INC: Fitch Withdraws Default and Junk Ratings UNITED SUBCONTRACTORS: Moody's Junks Ratings on Liquidity Concerns UTIX GROUP: Jonathan Adams Steps Down as Board Co-Chairman VIKING DRILLING: Files for Bankruptcy Amid Cost Overruns VIKING DRILLING: Case Summary & 95 Largest Unsecured Creditors WACHOVIA MORTGAGE: Three Classes of Certs. Get S&P's Junk Ratings WASTE SERVICES: Selling Jacksonville Assets to ADS for $58 Mil. WELLMAN INC: U.S. Trustee Sets March 10 Meeting to Form Committees WELLMAN INC: Wants to Employ Lazard Freres as Financial Advisor WELLS FARGO: Fitch Assigns 'B' Rating on $440,000 Class B-5 Certs. * S&P Downgrades 74 Tranches' Ratings From 13 Cash Flows and CDOs * Defaults on Privately Insured Mortgages Rose 31% in January * FTC Chairman Deborah Platt Majoras to Leave FTC in Late March * BOND PRICING: For the Week of Feb. 25 - Feb. 29, 2008 ********* 44 BRUSHY NECK: Voluntary Chapter 11 Case Summary ------------------------------------------------- Debtor: 44 Brushy Neck, Ltd. 100 Mill Road West Hampton Beach, NY 11978 Bankruptcy Case No.: 08-41124 Chapter 11 Petition Date: February 28, 2008 Court: Eastern District of New York (Brooklyn) Debtor's Counsel: Joseph J. Fontanetta, Esq. (jfontesq@verizon.net) 484 West Main Street Babylon, NY 11702 Tel: (631) 661-3540 Fax: (631) 661-2722 Total Assets: $2,200,000 Total Debts: $1,844,848 The Debtor did not file a list of its largest unsecured creditors. 1025 ROUTE 17M: Case Summary & Five Largest Unsecured Creditors --------------------------------------------------------------- Debtor: 1025 Route 17M, LLC 10 Lizensk Boulevard, Unit 301 Monroe, NY 10950 Bankruptcy Case No.: 08-35351 Type of Business: The Debtor owns real estate. Chapter 11 Petition Date: February 28, 2008 Court: Southern District of New York (Poughkeepsie) Judge: Cecelia G. Morris Debtor's Counsel: Robert S. Lewis, Esq. (lewlaw1@aol.com) 53 Burd Street Nyack, NY 10960 Tel: (845) 358-7100 Fax: (845) 353-6943 Total Assets: $3,500,000 Total Debts: $3,429,848 Debtor's Five Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Allstate Interiors, Inc. Trade debt $58,160 Welby, Grady & Greenblatt 11 Martine Avenue, 15th Floor White Plains, NY 10606 Paul Neberasky Plumbing & Trade debt $36,041 Heating 1019 Route 17M Monroe, NY 10950 Fabricant & Lippman Trade debt $33,299 One Harriman Square P.O. Box 60 Goshen, NY 10924 Brooker Engineering, PLLC Trade debt $25,648 Landscaping Trade debt $26,700 AAMES MORTGAGE: Adverse Performance Cues S&P's Rating Downgrades ---------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on five classes issued by Aames Mortgage Trust 2001-3 and Aames Mortgage Investment Trust 2004-1 and removed one of the lowered ratings from CreditWatch with negative implications. Concurrently, S&P affirmed its ratings on 21 classes from four Aames transactions. The downgrades reflect continuous adverse pool performance, which has eroded available credit support during recent months. As of the January 2008 remittance report, cumulative losses for series 2001-3 were $12.15 million while serious delinquencies (90-plus days, foreclosures, and REOs) were $2.607 million. For series 2004-1, cumulative losses were $14.9 million, while serious delinquencies were $46.68 million. For both series, losses have outpaced excess interest for eight of the most recent 12 months. Current and projected credit support percentages are sufficient to support the affirmed ratings at their current levels. Overcollateralization, excess spread, and subordination provide credit support for these deals. The underlying collateral originally consisted of subprime fixed- and adjustable-rate first and second liens on owner-occupied one- to four-family residential properties. Rating Lowered and Removed From CreditWatch Negative Aames Mortgage Trust 2001-3 Rating ------ Class To From ----- -- ---- M2 CCC B/Watch Neg Ratings Lowered Aames Mortgage Investment Trust 2004-1 Rating ------ Class To From ----- -- ---- B1A, B1F BB BBB+ B2 B BBB B3 CCC BBB- Ratings Affirmed Aames Mortgage Trust Series Class Rating ------ ----- ------ 2001-1 A-1, A-2 AAA 2001-1 M-1 AA+ 2001-1 M-2 A 2002-2 A-1, A-2 AAA 2002-2 M-1 AA+ 2002-2 M-2 AA 2002-2 M-3 A 2002-2 B BBB 2001-3 A-1, A-IO AAA 2001-3 M-1 AA+ Aames Mortgage Investment Trust 2004-1 Class Rating ----- ------ M2 AA+ M3, M4 AA M5 AA- M6 A+ M7 A M8 A- M9 BBB+ AGILYSIS INC: Amends Credit, Inventory Financing Agreements ----------------------------------------------------------- On Feb. 21, 2008, Agilysys Inc. entered into a Fourth Amendment Agreement to its Credit Agreement, dated Oct. 18, 2005. The Credit Agreement provides for loans and letters of credit aggregating to $200 million, including a $20 million sub-facility for letters of credit issued by LaSalle Bank National Association or one of its affiliates and a $20 million sub-facility for swingline loans, which are short-term loans generally used for working capital requirements. The Fourth Amendment replaced the definitions of Agreement for Inventory Financing, Consolidated Fixed Charges, Consolidated Funded Indebtedness, Excluded Subsidiary, Leverage Ratio, Liquidity Ratio, Material Indebtedness Agreement, and Permitted Foreign Subsidiary Loans and Investments. The Fourth Amendment also provides that the company's Fixed Charge Coverage Ratio cannot be less than 1.20 to 1.00, the company's Leverage Ratio cannot exceed 2.80 to 1.00, and for certain Consolidated Net Worth requirements for the company. For any fiscal quarter in which the Leverage Ratio equals or exceeds 2.00 to 1.00, a Liquidity Ratio of at least 1.00 to 1.00 for such quarter will be applicable as well. Additionally, the Fourth Amendment amended Schedule 3 (Guarantors of Payment) to the Credit Agreement to reflect changes in the company's domestic guarantors of payment. The full text of the Fourth Amendment will be filed as an exhibit to the company's next periodic report in accordance with Item 601 of Regulation S-X which apply to disclosure documents filed with the Securities and Exchange Commission. Agreement for Inventory Financing On Feb. 22, 2008, the company entered into the Fourth Amended and Restated Agreement for Inventory Financing with IBM Credit LLC, a wholly-owned subsidiary of International Business Machines Corporation. In addition to providing the Inventory Financing Agreement, IBM has engaged and may engage as a primary supplier to the company in the ordinary course of business. Under the Inventory Financing Agreement, the company may finance the purchase of products from authorized suppliers up to an aggregate outstanding amount of $145 million. The Lender may, in its sole discretion, temporarily increase the amount of the credit line but in no event shall the amount of the credit line exceed $250 million. No finance charges shall accrue on any outstanding amounts during the free financing period. The Inventory Financing Agreement contains the same affirmative, negative, and financial covenants customary as the Credit Facility. The Inventory Financing Agreement also contains customary representations and warranties. The full text of the Inventory Financing Agreement will be filed as an exhibit to the company's next periodic report in accordance with Item 601 of Regulation S-K. About Agilysys Inc. Based in Mayfield Heights, Ohio, Agilysys Inc. (Nasdaq: AGYS) -- http://www.agilysys.com/-- is one of the distributors and resellers of enterprise computer technology solutions. The company is delivering complex server and storage hardware, software and services to resellers, large and medium-sized corporate customers, well as public-sector clients across a diverse set of industries. In addition, the company provides customer-centric software applications and services focused on the retail and hospitality markets. Agilysys has sales offices throughout the United States and Canada. * * * Standard and Poor's placed Agilysys Inc.'s long-term foreign and local issuer credit ratings at "BB-" in October 2004. The ratings still hold to date. ALION SCIENCE: 10Q Filing Delay Cues S&P's Negative Watch Listing ----------------------------------------------------------------- Standard & Poor's Ratings Services placed its ratings on Alion Science and Technology Corp., including the 'B' corporate credit rating, on CreditWatch with negative implications. The CreditWatch listing follows the company's announcement that it is delaying the filing of its Form 10-Q for the quarter ended Dec. 31, 2007, without providing details related to the delay. Also, in a separate filing, McLean, Virginia-based Alion Science announced the resignation of its chief financial officer. "The CreditWatch listing reflects uncertainty regarding the timing of the company's ability to file its Form 10-Q and our inability to determine the company's operating and financial performances during this period," said Standard & Poor's credit analyst David Tsui. S&P could lower the ratings if the delayed filing triggers any liquidity events. Also, since there is very limited cushion within the current rating, further deterioration in operating performance could lead to a downgrade. If Alion Science files its financial statements without any adverse impact from the late filing and if operating performance is in line with expectations, we would affirm the corporate credit rating with a negative outlook and remove all the ratings from CreditWatch. AMBAC FINANCIAL: Moody's Reviews 'Aaa' Rating For Likely Downgrade ------------------------------------------------------------------ Moody's Investors Service concluded its analysis of the residential mortgage and mortgage-related CDO exposures of Ambac Assurance Corporation, and is continuing a review for possible downgrade that was initiated on Jan. 16, 2008. Based on an updated assessment of Ambac's mortgage risk, Moody's believes that Ambac's capital exceeds the minimum Aaa standard but falls below the Aaa target level. As outlined in Moody's previous communications with the market about such situations, it is its practice to evaluate plans the company is pursuing to close the gap between actual capitalization and target levels, including the certainty of those plans and the timeframe over which they would likely be realized. Ambac is actively pursuing capital strengthening activities that, if successful, are expected to result in the company meeting Moody's current estimate of the Aaa target level. Moody's continuing review will focus on both the further refinement of, and execution of, those capital plans, as well as on substantive changes that Ambac is implementing to its risk and operating strategies going forward. Overview of Rating Approach As outlined in Moody's Rating Methodology for Financial Guarantors, Moody's evaluated Ambac along five key rating factors: 1) franchise value and strategy, 2) insurance portfolio characteristics, 3) capital adequacy, 4) profitability, and 5) financial flexibility. Of these factors, capital adequacy is given particular emphasis. To estimate capital adequacy, Moody's has applied its traditional portfolio risk model for determining stress losses on the non- mortgage related portion of Ambac's insured portfolio, and alternative stress tests for the mortgage and mortgage-related CDO exposure. For mortgage-related exposures, stress losses were estimated using assumptions consistent with a scenario where 2006 subprime first-lien mortgages realize an average of 21% cumulative pool losses, with other vintages and products stressed accordingly. Stress-level losses for RMBS transactions were assessed on a transaction-by-transaction basis, while loss estimates for ABS CDOs were derived using a stochastic simulation model which applied stress to specific underlying collateral tranches within the CDOs. Estimated tranche-level losses were computed based on the structure of those tranches (e.g., attachment and detachment points) and estimates of their performance relative to the average. Losses estimated under the approach described above were present- valued to reflect estimates of the payout pattern that would emerge, based on the collateral type. For ABS CDOs, consideration was given to specific contractual features within associated CDS contracts. These factors resulted in aggregate present value discounts to principal loss estimates of approximately 8% for RMBS and 22% for ABS CDOs. Non-mortgage risks are discounted within the portfolio model based on estimates of payout patterns as well. In view of the expected correlation between the prospective experience of Ambac and its reinsurers, and given reviews for possible downgrade of RAM Reinsurance Company Ltd. (Aa3) and BluePoint Re Limited (Aa3), Moody's has also, for purposes of estimating capital adequacy, reduced the estimated credit given for reinsurance in the stress case, to 73%, on average, across the portfolio. In comparing estimated stress losses to claims paying resources and associated rating levels, Moody's combines an estimated loss distribution for mortgage risks with one for non-mortgage risks, assuming a correlation between the two that ranges from 90% (for Aaa) down to 30% (for Baa3). Claims paying resources are then compared to the indicated capital need, at the target benchmark (1.3x required capital). Key Rating Factors - Capital Adequacy Based on the risks in Ambac's portfolio, as assessed by Moody's according to the approach outlined above, estimated stress-case losses would approximate $12.1 billion. This compares to Moody's estimate of Ambac's claims paying resources of approximately $13.7 billion, resulting in a total capital ratio of 1.13x, which exceeds the "minimum" Aaa level, but is short of the 1.3x Aaa "target" level by about $2 billion. Moody's further noted that in the most likely or "expected" scenario, Ambac's insured portfolio will incur lifetime losses of approximately $4.2 billion in present value terms, and that Ambac's current claims-paying resources cover this expected loss estimate by about 3.2x. Key Rating Factors - Business and Financial Profile In Moody's opinion, Ambac's significant exposure to mortgage- related risk has had consequences for its business and financial profile beyond the associated impact on capitalization, and affects Moody's opinion about Ambac's other key rating factors. Nonetheless, despite some of the recent challenges faced by the company related to investor confidence, Moody's believes that Ambac is better-positioned relative to certain less-established competitors with respect to business franchise, prospective profitability and financial flexibility. With respect to underwriting and risk management, Moody's believes that Ambac's significant exposure to the mortgage sector is indicative of a risk posture greater than would be consistent with a Aaa rating going forward. The company's participation in several 2007 vintage CDO-squared transactions, in particular, contributed to this view. Moody's expects Ambac to implement significant changes to its underwriting and risk management guidelines to reduce volatility in its insured portfolio, including the exit from certain types of structured finance business, as well as tighter risk controls around the structured finance business the company intends to pursue going forward. In Moody's opinion, it will be critical for the company to focus on reducing single risk concentrations across its portfolio. Moody's also believes that Ambac's non-core asset management activities, including GICs and interest rate and total return swaps, place incremental negative pressure on its ratings. Prospectively, Ambac's profitability is likely to remain below historical levels over the near to intermediate term, particularly given the reduced issuance volumes generally, and investor caution about financial guarantors with mortgage-related exposures. It is uncertain how long this situation will persist. However, some earnings stability is provided by Ambac's large in-force portfolio, which will continue to provide significant premium revenue even if new business production remains sluggish over the near term. The ability of the company to reestablish its strong market position in the US public finance market will take time. In Moody's opinion, however, Ambac's extensive relationships with issuers, as well as its prominent market position, expertise and execution capabilities in several market sectors, provide the company with a good foundation from which to regain market confidence in the US public finance sector. In terms of financial flexibility, Ambac, like other financial guarantors, benefits from its ability to pay claims over an extended period of time, typically scheduled interest and principal at maturity. Moody's has also considered in its rating review the potential for calls on liquidity at Ambac in the context of available resources, including the investment profile of the operating insurance entities and its asset management activities. Ambac's financial leverage profile could increase if incurred losses further erode shareholders' equity. Additional debt in the capital structure would increase leverage and place additional demands on the operating companies to service fixed charges. Here, Moody's believes that holding company liquidity is currently adequate, supported by dividend capacity from Ambac Assurance Corporation and additional debt service coverage available through cash and investments held at the holding company. View on Possible Split of Municipal and Structured Businesses Ambac could elect to pursue public finance and structured finance businesses through distinct legal entities. The ratings appropriate for separate insurers operating under such a strategy would depend on their specific business and financial characteristics, including capitalization and underwriting frameworks. In this scenario, Moody's believes that the structured finance guarantor would be more challenged than its public finance affiliate to maintain a Aaa rating, due to the relatively greater complexity of risks and higher risk concentrations evident in that sector of the market. Those risks are more muted within a single-company structure where more granular and lower-risk public finance exposures provide diversification across risk and time dimensions. Moody's further believes that guarantors splitting their business among distinct legal entities might have a greater incentive to allocate capital in favor of the public sector guarantor, given the somewhat greater importance attached to Aaa ratings by customers in that market. The effect of these structural changes would likely be to reduce the risk of downgrade for the guarantor's insured municipal debt and to increase the risk of downgrade for the insurer's other exposures. Overview of Ambac Ambac Financial Group Inc., headquartered in New York City, is a holding company whose affiliates provide financial guarantees and financial services to clients in both the public and private sectors around the world. For the year ended Dec. 31, 2007, Ambac reported a net loss of approximately $3.3 billion. As of Dec. 31, 2007, Ambac had shareholders' equity of approximately $2.3 billion. AMBAC FINANCIAL: CEO Glad with Moody's Comment; to Cut Dividend --------------------------------------------------------------- Ambac Financial Group, Inc. (NYSE: ABK) (Ambac) commented on a news release by Moody's Investors Service Friday regarding the conclusion of its analysis of the residential mortgage and mortgage-related CDO exposures, in connection with its ongoing review of Ambac's Aaa rating. Moody's announced, in its release, that Ambac's capital "exceeds the 'minimum' Aaa standard, (and that) Ambac is actively pursuing capital strengthening activities that, if successful, are expected to result in the Company meeting Moody's current estimate of the Aaa target level." In completing this phase of its review, Moody's also noted that it "believes Ambac is better-positioned relative to certain less-established competitors with respect to business franchise, prospective profitability and financial flexibility." Michael Callen, Chairman and CEO of Ambac Financial Group, commented that, "We are pleased with this acknowledgment by Moody's of the strength of our capital position and our franchise" and he confirmed that "we are actively pursuing a plan to further augment our capital resources in order to achieve Moody's' Aaa target." Mr. Callen added, "We are undertaking important steps to strengthen our company and support our ratings. Ambac will reduce its quarterly dividend from $0.07 to $0.01 per share and suspend all new structured finance business for the next six months. Suspending structured finance writings for six months is expected to free up approximately $600 million in capital." "In conjunction with this suspension," said Mr. Callen, "we will discontinue writing business in a number of sectors in the global structured finance markets where the risk dynamics are not aligned with our vision of the future of Ambac. Furthermore, we are discontinuing writing new financial services businesses, including investment agreements and swaps, except where we are hedging existing exposures; and we will no longer execute financial guarantees using credit default swaps. These actions will allow us to focus our structured and international businesses on low volatility sectors, where we can generate good risk-adjusted returns." "Finally," he said, "we have implemented changes to our underwriting and risk management guidelines and are reviewing our underwriting criteria, net retention limits and single risk concentrations." Mr. Callen concluded, "We are optimistic about the business opportunities ahead for Ambac, both in municipal finance and in selected structured finance and international markets, when we resume that business. We appreciate the support of our policyholders, shareholders, clients and staff, as well as the many other parties, both public and private, who have provided support throughout this period of examination and business review." About Ambac Financial Based in New York City, Ambac Financial Group, Inc. is a holding company whose affiliates provide financial guarantees and financial services to clients in both the public and private sectors around the world. For the nine months ended Sept. 30, 2007, Ambac reported net income of $26 million. As of Sept. 30, 2007, Ambac had shareholders' equity of approximately $5.65 billion. * * * On Jan. 18, Fitch Ratings downgraded Ambac to double-A after the insurer put off plans to raise equity capital. As reported Troubled Company Reporter on Jan. 17, 2008, Moody's Investors Service placed the Aaa insurance financial strength ratings of Ambac Assurance Corporation and Ambac Assurance UK Limited on review for possible downgrade. In the same rating action, Moody's also placed the ratings of the holding company, Ambac Financial Group, Inc. (senior debt at Aa2), and related financing trusts on review for possible downgrade. Moody's stated that this rating action follows Ambac's announcement of record losses, a capital raising plan, and the retirement of its CEO. AMBAC FINANCIAL: Receives Subpoena from Massachusetts ----------------------------------------------------- Ambac Financial Group, Inc. disclosed in regulatory filings with the Securities and Exchange Commission that it has received various regulatory inquiries and requests for information, including a subpoena duces tecum and interrogatories from the Securities Division of the Office of the Secretary of the Commonwealth of Massachusetts, dated January 18, 2008, that seeks certain information and documents concerning "Massachusetts Public Issuer Bonds." Ambac also disclosed that the company and certain of its present and former officers and directors have been named in lawsuits that allege violations of the federal securities laws or state law. Various putative class action suits alleging violations of the federal securities laws have been filed against the company and certain of its present or former directors and officers. The suits include Reimer v. Ambac Financial Group, Inc., et al. (filed January 16, 2008 in the United States District Court for the Southern District of New York, case No. 08-CV-411), which purports to be brought on behalf of purchasers of Ambac's common stock from October 19, 2005 to November 26, 2007. The suit alleges, among other things, that the defendants issued materially false and misleading statements regarding the company's business and financial results related to guarantees of CDO and MBS transactions. Three other suits, Babic v. Ambac Financial Group Inc. et al. (filed February 7, 2008 in the United States District Court for the Southern District of New York, case No. 08-CV-1273), Parker v. Ambac Financial Group, Inc. et al (filed February 22, 2008 in the United States District Court for the Southern District of New York, case No. 08-CV-1825) and Minneapolis Firefighters' Relief Association v. Ambac Financial Group, Inc. et al. (filed February 26, 2008 in the United States District Court for the Southern District of New York, Case No. 08-CV-1918), make substantially the same allegations as the Reimer action. Various shareholder derivative actions have recently been filed against certain present and former officers and directors of Ambac, and Ambac as a nominal defendant. The suits, which are brought purportedly on behalf of the company, are in many ways similar and allege violations of law for conduct occurring between October 2005 and the present regarding, among other things, the company's guarantees of CDO and MBS transactions and defendants' alleged insider trading on non-public information. About Ambac Financial Based in New York City, Ambac Financial Group, Inc. is a holding company whose affiliates provide financial guarantees and financial services to clients in both the public and private sectors around the world. For the nine months ended Sept. 30, 2007, Ambac reported net income of $26 million. As of Sept. 30, 2007, Ambac had shareholders' equity of approximately $5.65 billion. * * * On Jan. 18, Fitch Ratings downgraded Ambac to double-A after the insurer put off plans to raise equity capital. As reported Troubled Company Reporter on Jan. 17, 2008, Moody's Investors Service placed the Aaa insurance financial strength ratings of Ambac Assurance Corporation and Ambac Assurance UK Limited on review for possible downgrade. In the same rating action, Moody's also placed the ratings of the holding company, Ambac Financial Group, Inc. (senior debt at Aa2), and related financing trusts on review for possible downgrade. Moody's stated that this rating action follows Ambac's announcement of record losses, a capital raising plan, and the retirement of its CEO. AMBAC FINANCIAL: Faces New Competition from Berkshire Unit ---------------------------------------------------------- MBIA Inc., and Ambac Financial Group, the top U.S. bond insurers, face new competition from a unit formed by billionaire Warren Buffett's Berkshire Hathaway Inc., The Wall Street Journal reports. Mr. Buffett launched Berkshire Hathaway Assurance Corp. in December to guarantee municipal bonds. The unit is swiftly building market share. In recent days, ratings firms have bestowed triple-A ratings on municipal bonds insured by the Berkshire venture, months before competitors and some analysts predicted, the report says. On Friday, WSJ relates, Maryland's insurance department granted Berkshire a license to do business in that state. The company already has guaranteed more than 100 municipal-bond offerings, WSJ says. In a separate report, WSJ says investor Wilbur Ross will be putting in $1,000,000,000 in Assured Guaranty Ltd., the country's fifth largest bond insurer. Mr. Ross will get a seat on Assured Guaranty's board, WSJ says. According to WSJ, Assured is seen as having the fewest problems among several bond insurers, and the deal with Mr. Ross is likely to put more pressure on Ambac and MBIA. About Berkshire Hathaway Berkshire Hathaway and its subsidiaries engage in diverse business activities including property and casualty insurance and reinsurance, utilities and energy, finance, manufacturing, retailing and services. Common stock of the company is listed on the New York Stock Exchange, trading symbols BRK.A and BRK.B. About MBIA Headquartered in Armonk, New York, MBIA Inc. (NYSE:MBI) -- http://www.mbia.com-- provides financial guarantee insurance, investment management services, and municipal and other servicesto public finance and structured finance clients on a globalbasis. The company conducts its financial guarantee business through its wholly owned subsidiary, MBIA Insurance Corporation and provides investment management products and financial services through its wholly owned subsidiary MBIA Asset Management, LLC. MBIA manages its activities primarily through two principal business operations: insurance and investment management services. In February 2007, MBIA Corp. formed a new subsidiary, MBIA Mexico, S.A. de C.V. During the year ended Dec. 31, 2006, MBIA discontinued its municipal services operations. These operations included MBIA MuniServices Company. On Dec. 5, 2006, the company completed the sale of MBIA MuniServices Company. As reported in the Troubled Company Reporter on Feb. 28, MBIA retained top-notch triple A ratings from Standard and Poors and Moody's Investors Service. About Ambac Financial Based in New York City, Ambac Financial Group, Inc. is a holding company whose affiliates provide financial guarantees and financial services to clients in both the public and private sectors around the world. For the nine months ended Sept. 30, 2007, Ambac reported net income of $26 million. As of Sept. 30, 2007, Ambac had shareholders' equity of approximately $5.65 billion. * * * On Jan. 18, Fitch Ratings downgraded Ambac to double-A after the insurer put off plans to raise equity capital. As reported Troubled Company Reporter on Jan. 17, 2008, Moody's Investors Service placed the Aaa insurance financial strength ratings of Ambac Assurance Corporation and Ambac Assurance UK Limited on review for possible downgrade. In the same rating action, Moody's also placed the ratings of the holding company, Ambac Financial Group, Inc. (senior debt at Aa2), and related financing trusts on review for possible downgrade. Moody's stated that this rating action follows Ambac's announcement of record losses, a capital raising plan, and the retirement of its CEO. AMERICAN AXLE: Union Members Rally to Preserve Well-Paying Jobs --------------------------------------------------------------- United Auto Workers union members on strike at American Axle & Manufacturing Inc. are fighting to preserve well-paying U.S. manufacturing jobs at the company. "Our union is a responsible organization, and we've worked through complex problems at Chrysler LLC, Ford Motor Co., General Motors Corp., Delphi Corp., Dana Corp. and other companies," UAW President Ron Gettelfinger said. "But negotiations can't be a one-way street." "We have repeatedly proven that we will work with this company, during these negotiations and during previous negotiations," UAW Vice President Jimmy Settles, who directs the union's American Axle Department, said. "The plain fact is, the company has not appropriately responded to our significant and serious proposals, and that's what caused this labor dispute," Erv Heidbrink, president of UAW Local 2093 said, representing some 800 UAW members at American Axle's manufacturing facility in Three Rivers, Michigan. "Nobody likes a strike," Mr. Heidbrink said, "but the company continues to make unreasonable and unnecessary demands which attack our wages, pensions and health care -– and they haven't provided us the information we need to evaluate their proposals. "Our members are getting terrific support from all over the UAW and we're standing strong," Mr. Heidbrink said. "We're ready for serious bargaining at any time, and we want to get this dispute resolved as soon as we can." American Axle was created in 1994 when GM spun off five U.S. plants making axles and drive line components, employing approximately 6,500 UAW members. Since 1994 industry-leading quality and greatly increased productivity in UAW-represented facilities has created significant profits for AAM, leading to expansion of the company to 29 facilities worldwide. But operations at facilities in North America covered by the UAW American Axle master agreement have been reduced, now employing approximately 3,500 workers. 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. * * * As reported in the Troubled Company Reporter on Feb. 28, 2008, Standard & Poor's Ratings Services said that its ratings on American Axle and Manufacturing Holdings Inc. (BB/Negative/--) are not immediately affected by reports that the UAW elected to conduct a work stoppage at the expiration of its four-year master labor agreement with American Axle. As reported in the Troubled Company Reporter on Nov. 27, 2007, Moody's Investors Service affirmed American Axle & Manufacturing Holdings, Inc.'s Corporate Family rating of Ba3 as well its senior unsecured rating of Ba3 to American Axle & Manufacturing Inc.'s notes and term loan. At the same time, the rating agency revised the rating outlook to stable from negative and renewed the Speculative Grade Liquidity rating of SGL-1. AMERICAN MEDICAL: Moody's Holds B1 Rating; Gives Negative Outlook ----------------------------------------------------------------- Moody's Investors Service affirmed the B1 corporate family and probability of default rating of American Medical Systems Holdings, Inc.'s but changed the outlook to negative from stable. Concurrently, Moody's downgraded the company's liquidity rating to SGL 3 from SGL 2. Notwithstanding improved performance in the fourth quarter of 2007, the change in outlook to negative reflects underperformance in recent quarters and weaker than anticipated credit metrics, as well as senior management uncertainties following the resignation of the former Chief Executive Officer in January 2008. The negative ratings outlook also reflects minimal tolerance to absorb adverse fluctuations within the current rating category, the ongoing potential for execution risk, as well as Moody's expectation of limited cushions under the company's revised financial covenants. The SGL-3 Speculative Grade Liquidity rating reflects Moody's expectation of adequate near term liquidity. Moody's expectation is that internally generated cash flow, along with cash on hand, should be sufficient to fund the company's ongoing operational needs, capital expenditures and modest mandatory debt amortization over the next four quarters. The ratings are constrained by high ongoing financial leverage following the 2006 debt-financed acquisition of Laserscope, the absence of scale relative to larger competitors and the company's acquisitive growth strategy. The ratings benefit from organic double digit growth rates in revenue across most product lines and relatively low maintenance capital expenditures, which give rise to substantively positive free cash flow generation in relation to debt levels. Also, despite continuing integration challenges and increased sales and marketing costs with respect to Laserscope, the potential for incremental savings in raw materials and manufacturing efficiencies remains. Moody's affirmed these ratings: -- Corporate Family Rating, rated B1; -- Probability of Default Rating, rated B1; -- $65 million senior secured revolver due 2012, rated Ba2 (LGD2, 21%); -- $314 million senior secured term loan B due 2012, rated Ba2 (LGD2, 21%); -- $374 million convertible senior subordinated notes due 2036, rated B3 (LGD5, 77%); The ratings outlook is negative. Moody's also downgraded the Speculative Grade Liquidity Rating to SGL 3 from SGL 2. American Medical Systems Inc., headquartered in Minnetonka, Minnesota, develops and delivers innovative medical solutions to target patients and physicians (primarily urologists, gynecologists, urogynecologists and colorectal surgeons) treating men's and women's pelvic health conditions. For fiscal 2007, the company reported sales of approximately $464 million. AMERICHIP INTERNATIONAL: Completes Acquisition of KSI Machine ------------------------------------------------------------- AmeriChip International Inc. completed on Feb. 15, 2007 the purchase of all the issued and outstanding common stock of KSI Machine and Engineering Inc. of Clinton Township, Michigan, pursuant to the terms and condition of a letter of intent signed Dec. 7, 2004. KSI suplies machining large industrial castings and molds for the automotive and aerospace industries utilizing state of the art CNC machinery. The stock purchase was for an aggregate consideration of $3.2 million. During the year ended Nov. 30, 2004, the company paid a deposit of $50,000. On Dec. 7, 2004, the company paid an additional $100,000. On Oct. 6, 2005, the company paid an additional $30,000. On Nov. 7, 2005, the company paid an additional $20,000. The company has re-financed the equipment owned by KSI through People's State Bank in the amount $1,600,000 and the Small Business Administration in the amount of $1,280,000 for an aggregate $2,880,000. About AmeriChip International Based in Clinton Township, Michigan, AmeriChip International Inc. (OTC BB: ACHI.OB) -- http://www.americhiplacc.com/-- holds a patented technology known as Laser Assisted Chip Control, which can be used to re-engineer the manufacturing process for industrial metal machining applications. Going Concern Disclaimer Jewett, Schwartz, Wolfe & Associates, in Hollywood, Florida, expressed substantial doubt about Americhip International Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements for the year ended Nov. 30, 2007. The auditing firm pointed to the company's recurring losses from operations. AMERIMAC PROPERTIES: Case Summary & Largest Unsecured Creditor -------------------------------------------------------------- Debtor: Amerimac Properties, L.L.C. 287 So. Indiana Avenue Englewood, FL 34223 Bankruptcy Case No.: 08-02568 Chapter 11 Petition Date: February 28, 2008 Court: Middle District of Florida (Tampa) Judge: Michael G. Williamson Debtor's Counsel: L. Murray Fitzhugh, Esq. (lmurrayfitzhugh@yahoo.com) 2167 S Tamiami Trail Venice, FL 34293 Tel: (941) 493-6577 Total Assets: $1,600,000 Total Debts: $730,000 Debtor's Largest Unsecured Creditor: Entity Nature of Claim Claim Amount ------ --------------- ------------ Jovan Ignatovski loan with $115,000 Attention: Gregg Horowitz repayment from the P.O. Box 2927 sale of property Sarasota, FL 34230 described in Schedule A AMERIQUEST MORTGAGE: Two Classes Get S&P's Junk Ratings ------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on three classes of asset-backed pass-through certificates from Ameriquest Mortgage Securities Inc.'s series 2002-AR1. Concurrently, S&P affirmed its rating on class M-1. The downgrades reflect recent collateral performance that has continuously eroded available credit support. As of the January 2008 remittance period, cumulative losses on series 2002-AR1 were 1.73% of the original principal balance. Serious delinquencies (90-plus days, foreclosures, and REOs) were $5.081 million, about three times the current overcollateralization (O/C), which is substantially below its $2.7 million target. Realized losses have outpaced average excess interest for nine of the 12 most recent months. S&P affirmed its rating on class M-1 because current and projected credit support percentages are sufficient for the current rating level. O/C, excess spread, and subordination provide credit enhancement for this transaction. At issuance, the collateral backing the deal consisted of subprime, fixed- and adjustable-rate, fully amortizing first-lien mortgage loans secured by one- to four- family residential properties. Ratings Lowered Ameriquest Mortgage Securities Inc. series 2002-AR1 Rating ------ Class To From ----- -- ---- M-2 BBB A M-3 CCC B M-4 CCC B Rating Affirmed Ameriquest Mortgage Securities Inc. series 2002-AR1 Class Rating ----- ------ M-1 AAA ANSLEY PARK: Five Classes of Notes Obtain Moody's Junk Ratings -------------------------------------------------------------- Moody's Investors Service downgraded ratings of six classes of notes issued by Ansley Park ABS CDO, Ltd., and left on review for possible further rating action the rating of one of these classes of notes. The notes affected by this rating action are: Class Description: $11,150,000 Class X Senior Secured Notes Due 2046 -- Prior Rating: Aaa, on review for possible downgrade -- Current Rating: C Class Description: $450,000,000 Class A-1 Senior Secured Floating Rate Notes Due 2046 -- Prior Rating: Baa1, on review for possible downgrade -- Current Rating: B3, on review with future direction uncertain Class Description: $98,000,000 Class A-2 Senior Secured Floating Rate Notes Due 2046 -- Prior Rating: Caa1, on review for possible downgrade -- Current Rating: C Class Description: $27,500,000 Class B Senior Secured Floating Rate Notes Due 2046 -- Prior Rating: Caa2, on review for possible downgrade -- Current Rating: C Class Description: $9,000,000 Class C Secured Floating Rate Deferrable Notes Due 2046 -- Prior Rating: Ca -- Current Rating: C Class Description: $8,000,000 Class D Secured Floating Rate Deferrable Notes Due 2046 -- Prior Rating: Ca -- Current Rating: C The rating actions reflect deterioration in the credit quality of the underlying portfolio, as well as the occurrence as reported by the Trustee on Nov. 6, 2007, of an event of default caused by a failure of the ratio, calculated by dividing the Net Outstanding Portfolio Collateral Balance by the Aggregate Outstanding Amount of the Class A Notes, to equal or exceed 100%, pursuant to Section 5.01(i) of the Indenture dated Dec. 20, 2006. This event of default is still continuing. Ansley Park ABS CDO, Ltd. is a collateralized debt obligation backed primarily by a portfolio of RMBS securities and CDO securities. As provided in Section 5 of the Indenture during the occurrence and continuance of an Event of Default, holders of Notes may be entitled to direct the Trustee to take particular actions with respect to the Collateral Debt Securities and the Notes. In this regard the Trustee reports that a majority of the Controlling Class has declared the aggregate outstanding amount of the Notes and, with respect to the Class X Notes, the redemption price to be immediately due and payable, together with all of the accrued and unpaid interest thereon, and to terminate the Reinvestment Period. Furthermore, according to the Trustee, a majority of the Controlling Class has directed the sale and liquidation of the Collateral in accordance with relevant provisions of the transaction documents. The rating downgrades taken reflect the increased expected loss associated with each tranche. Losses are attributed to diminished credit quality on the underlying portfolio. The severity of losses of certain tranches may be different, however, depending on the outcome of the liquidation. Because of this uncertainty, the ratings assigned to the Class A-1 Notes remain on review for possible further action. Moody's explained that the rating of the Class X Notes is downgraded to "C" from "Aaa, on review for possible downgrade", because this class becomes subordinate to the Class A-1 Notes in the liquidation Priority of payments. Moody's does not anticipate that upon a liquidation holders of the Class X Notes will receive any distribution of liquidation proceeds. ASSOCIATED MATERIALS: Names Cynthia L. Sobe Vice Pres.-CFO ---------------------------------------------------------- Associated Materials appointed Cynthia L. Sobe to serve as its vice president—chief financial officer, treasurer and secretary. Ms. Sobe will also hold this office for Associated Materials Holdings LLC, the company's direct parent company, and for AMH Holdings LLC and AMH Holdings II Inc., the company's indirect parent companies. Ms. Sobe has been with the company since 2001 having served as vice president—corporate controller until October 2005 and most recently as vice president—finance. Ms. Sobe has also been serving as the company's interim chief financial officer since September 2007. About Associated Materials Based in Cuyahoga Falls, Ohio, Associated Materials LLC fka. Associated Materials Inc. -- http://www.associatedmaterials.com/ -- is a manufacturer of exterior residential building products, which are distributed through company-owned distribution centers and independent distributors across North America. AMI produces a broad range of vinyl windows, vinyl siding, aluminum trim coil, aluminum and steel siding and accessories, as well as vinyl fencing and railing. AMI is a privately held, wholly-owned subsidiary of Associated Materials Holdings Inc., which is a wholly-owned subsidiary of AMH, which is a wholly-owned subsidiary of AMH II, which is controlled by affiliates of Investcorp S.A. and Harvest Partners Inc. * * * Associated Materials still carries Moody's Investors Service 'Ba3' Bank Loan Debt and 'B3' Subordinated Debt ratings assigned on Sept. 22, 2006. Outlook is stable. ATLANTIC COAST: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Atlantic Coast Packaging, LLC fka East Coast Packaging LLC 2715 North 7th Street Harrisburg, PA 17110 Bankruptcy Case No.: 08-00600 Type of Business: The Debtor provides contract packaging services. See http://www.fdapackaging.com/. Chapter 11 Petition Date: February 26, 2008 Court: Middle District of Pennsylvania (Harrisburg) Judge: Mary D. France Debtor's Counsel: Steven D. Usdin, Esq. Cohen Seglias Pallas Greenhall & Furman 30 South 17th Street 19th Floor Philadelphia, PA 19103 Tel: (215) 564-1700 Fax: (215) 564-3066 susdin@cohenseglias.com Estimated Assets: $500,000 to $1 million Estimated Debts: $1 million to $10 million Debtor's list of its 20 Largest Unsecured Creditors: Entity Claim Amount ------ ------------ JFC Temps, Inc $432,983 1520 Market Street Camp Hill, PA 17011 Overlord Partners LLC $149,700 5905 Ramsgate Road Bethesda, MD 20816 Unistaff $115,112 4724 Chestnut Street Philadelphia, PA 19139 BrickForce Staffing Inc. $93,931 Shadow Canyon $85,000 Packaging Films & Equipment $51,005 HRom International $50,977 Mr. Brian McHugh $46,000 Performance Personnel $26,500 Juno Services $21,754 Boles Metzger Brosius & Ritter PC $19,521 Wix Wenger & Weidner $17,518 Forklifts, Inc $16,127 Aetna USHealthcare $15,760 Cohen, Seglias, Pallas, Greenhall & Furm $14,614 The Jay Group, Inc. $10,787 Rapid Pallet Incorporated $8,589 Scott Edmonds $8,105 Xpedx $7,973 Bortek $6,876 AURIGA CDO: Poor Credit Quality Prompts Moody's Rating Downgrades ----------------------------------------------------------------- Moody's Investors Service downgraded ratings of nine classes of notes issued by Auriga CDO Ltd., and left on review for possible further downgrade the ratings of three of these classes. The notes affected by this rating action are: Class Description: $975,000,000 Class A-1 First Priority Senior Secured Floating Rate Notes due January 2047 -- Prior Rating: Aaa, on review for possible downgrade -- Current Rating: Ba1, on review for possible downgrade Class Description: $97,500,000 Class A-2A Second Priority Senior Secured Floating Rate Notes due January 2047 -- Prior Rating: A2, on review for possible downgrade -- Current Rating: Caa3, on review for possible downgrade Class Description: $48,000,000 Class A-2B Third Priority Senior Secured Floating Rate Notes due January 2047 -- Prior Rating: A3, on review for possible downgrade -- Current Rating: Caa3, on review for possible downgrade Class Description: $64,500,000 Class B Fourth Priority Senior Secured Floating Rate Notes due January 2047 -- Prior Rating: Baa2, on review for possible downgrade -- Current Rating: Ca Class Description: $63,000,000 Class C Fifth Priority Senior Secured Floating Rate Notes due January 2047 -- Prior Rating: Baa3, on review for possible downgrade -- Current Rating: C Class Description: $48,000,000 Class D Sixth Priority Mezzanine Secured Deferrable Floating Rate Notes due January 2047 -- Prior Rating: Ba2, on review for possible downgrade -- Current Rating: C Class Description: $42,000,000 Class E Seventh Priority Mezzanine Secured Deferrable Floating Rate Notes due January 2047 -- Prior Rating: Ba3, on review for possible downgrade -- Current Rating: C Class Description: $51,000,000 Class F Eighth Priority Mezzanine Secured Deferrable Floating Rate Notes due January 2047 -- Prior Rating: Caa2, on review for possible downgrade -- Current Rating: C Class Description: $28,500,000 Class G Ninth Priority Mezzanine Secured Deferrable Floating Rate Notes due January 2047 -- Prior Rating: Ca -- Current Rating: C The rating downgrade actions reflect deterioration in the credit quality of the underlying portfolio, as well as the occurrence as reported by the Issuer on Feb. 13, 2008, of an event of default described in Section 5.1(j) of the Indenture dated Dec. 20, 2006. Auriga CDO Ltd. is a collateralized debt obligation backed primarily by a portfolio of RMBS securities and CDO securities. Recent ratings downgrades on the underlying portfolio caused ratings-based haircuts to affect the calculation of overcollateralization. Thus, the Event of Default described in Section 5.1(j) of the Indenture occurred. As provided in Article V of the Indenture during the occurrence and continuance of an Event of Default, holders of Notes may be entitled to direct the Trustee to take particular actions with respect to the Collateral Debt Securities and the Notes. In this regard, Moody's has received notice from the Trustee that it, at the direction of a majority of the Controlling Class, has declared the principal of and accrued and unpaid interest on all of the Notes to be immediately due and payable. The rating downgrades taken reflect the increased expected loss associated with each tranche. Losses are attributed to diminished credit quality on the underlying portfolio. The severity of losses of certain tranches may be different, however, depending on the timing and choice of post-event of default remedy to be pursued by the Controlling Class. Because of this uncertainty, the ratings assigned to Class A-1 Notes, Class A-2A Notes and Class A-2B Notes remain on review for possible further action. AXCAN INTERMEDIATE: S&P Puts 'BB-' Rating on $518 Mil. Senior Debt ------------------------------------------------------------------ Standard & Poor's Ratings Services assigned its 'BB-' senior secured debt rating and '2' recovery rating to Axcan Intermediate Holdings Inc.'s (a wholly owned subsidiary of Quebec, Canada-based specialty pharmaceutical company Axcan Pharma Inc.) $518 million senior secured debt. The secured financing consists of a $175 million term loan A facility due 2014, a $115 million revolving credit facility due 2014, and $228 million in senior secured notes due 2015. The senior secured facilities and notes are rated 'BB-' (one notch higher than the 'B+' corporate credit rating on Axcan), with a recovery rating of '2', indicating the expectation for substantial (70%-90%) recovery in the event of a payment default. In addition, S&P assigned its 'B-' rating to Axcan's $235 million senior unsecured notes maturing in 2016. This debt structure replaces the original structure that was rated on Jan. 24, 2008. The corporate credit rating on Axcan is 'B+', and the outlook is stable. "The rating reflects the company's limited size and scale, high initial debt leverage, and susceptibility to generic competition," said Standard & Poor's credit analyst Arthur Wong. "The company's niche position in gastroenterology, relatively diverse product portfolio, and high margins partially offset these concerns." Ratings List Axcan Pharma Inc. Corporate Credit Rating B+/Stable/-- Ratings Assigned Axcan Intermediate Holdings Inc. Senior Unsecured B- Senior Secured BB- Recovery Rating 2 AXCAN PHARMA: Canada Industry Regulator OKs $1.3 Bil. Sale to TPG ----------------------------------------------------------------- Axcan Pharma Inc. disclosed that the Federal Minister of Industry, under the Investment Canada Act, has approved the proposed acquisition by an affiliate of TPG Capital of all outstanding common shares of Axcan Pharma Inc. through a plan of arrangement, as likely to be of net benefit to Canada. Axcan has previously received clearance under the Competition Act (Canada) and the requisite waiting period under the Hart-Scott- Rodino Antitrust Improvements Act of 1976 has expired; accordingly, Axcan received all regulatory approvals necessary to consummate the proposed acquisition. As reported in the Troubled Company Reporter on Jan 28, 2008, the company entered into an agreement for Axcan to be acquired by TPG Capital and its affiliates in an all-cash transaction with a total value of approximately $1.3 billion. About TPG Capital Based in Fort Worth, Texas, TPG Capital -- http://www.tpg.com/-- is a leading private investment firm founded in 1992, with more than $35 billion of assets under management and offices in San Francisco, London, Hong Kong, New York, Minneapolis, Fort Worth, Melbourne, Menlo Park, Moscow, Mumbai, Beijing, Shanghai, Singapore and Tokyo. TPG has extensive experience with global public and private investments executed through leveraged buyouts, recapitalizations, spinouts, joint ventures and restructurings. About Axcan Pharma Based in Mont Saint-Halaire, Quebec, Axcan Pharma Inc. (TSX: AXP)(NASDAQ: AXCA) -- http://www.axcan.com -- is a specialty pharmaceutical company focused on gastroenterology. The company develops and markets a broad line of prescription products to treat a range of gastrointestinal diseases and disorders such as inflammatory bowel disease, irritable bowel syndrome, cholestatic liver diseases and complications related to pancreatic insufficiency. * * * As reported in the Troubled Company Reporter on Jan. 28, 2008, Standard & Poor's Ratings Services assigned its 'B+' corporate credit rating to Axcan Pharma Inc. BANC OF AMERICA: Stable Performance Cues Fitch to Affirm Ratings ---------------------------------------------------------------- Fitch Ratings has affirmed Banc of America Commercial Mortgage Securities, Inc.'s mortgage pass-through certificates, series 2007-1, as: -- $51.8 million class A-1 at 'AAA'; -- $293 million class A-2 at 'AAA'; -- $444 million class A-3 at 'AAA'; -- $68.5 million class A-AB at 'AAA'; -- $698.7 million class A-4 at 'AAA'; -- $640.2 million class A-1A at 'AAA'; -- Interest-only class XW at 'AAA'; -- $214.5 million class A-MFX at 'AAA'; -- $259.5 million class A-J at 'AAA'; -- $27.5 million class B at 'AA+'; -- $100 million class A-MFL at 'AAA'; -- $35.4 million class C at 'AA'; -- $27.5 million class D at 'AA-'; -- $39.3 million class E at 'A'; -- $39.3 million class F at 'A-'; -- $35.4 million class G at 'BBB+'; -- $35.4 million class H at 'BBB'; -- $39.3 million class J at 'BBB-'; -- $7.9 million class K at 'BB+'; -- $11.8 million class L at 'BB'; -- $7.9 million class M at 'BB-'; -- $3.9 million class N at 'B+'; -- $7.9 million class O at 'B'; -- $11.8 million class P at 'B-'. Fitch does not rate the $39.3 million class Q. The affirmations are the result of stable performance since issuance in February 2007. As of the February 2008 distribution date, the pool's certificate balance has decreased 0.2% to $3.14 billion from $3.15 billion at issuance. There have been no delinquencies since issuance. Ninety-seven loans (87.4%) are interest-only or partial interest-only. Loan maturities range from 2011 to 2021 with 50.8% of the pool scheduled to mature in 2017. The Inland Bradley cross-collateralized portfolio (5.9%) maintains its investment-grade shadow rating. Reported weighted average occupancy as of September 2007 was 100% with a debt service coverage ratio of 2 times. The largest loan (8.6%) is a pari-passu note collateralized by a portfolio of eight office properties in Falls Church, Virginia. The weighted average occupancy as of September 2007 is 96.9% compared to 97.1% at issuance and 88.6% market occupancy. Although 85% of the leases expire during the first five years of the loan, the property has experienced historically high retention rates and continues to out perform the market. The second largest loan (7%) is secured by a mixed-use campus located in Westlake, Texas. The property includes over 2 million square feet of office and retail space and 198 hotel rooms. Reported weighted average occupancy at issuance was 94.6%. BAPTIST HEALTH: Moody's Puts 'Ba2' Debt Rating on Watchlist ----------------------------------------------------------- Moody's Investors Service placed on Watchlist for uncertain direction Baptist Health System of East Tennessee Obligated Group's Ba2 rating assigned to $193 million of outstanding debt issued by the Health, Educational and Housing Facilities Board of the County of Knox, Tennessee. The negative pressures affecting the rating center around the deteriorating financial performance and financial position of BHSET. The positive factors for the rating center around the recent merger with Catholic Healthcare Partners, the anticipated redemption of the Series 1996 bonds in March, and the potential for future financial support from CHP and operational improvement as a result of the merger. Operating performance continued to decline in the first four months of fiscal year 2008 (October), resulting in an operating loss of $15.2 million (-18.8% margin) and negative operating cash flow of $4.8 million (-5.9% margin). Liquidity remains very weak with under 40 days cash on hand, and the cash-to-debt ratio remains weak at less than 15%. BHSET merged with St. Mary's Health System, part of A1-rated CHP, in January 2008, making the merged organization the second largest provider in the market. As a result, a new parent organization is overseeing all metro Knoxville operations. New strategic plans are under development. As a first step, the $58 million of outstanding Series 1996 bonds are scheduled to be called in March 2008. Further strategic initiatives have yet to be finalized. Rated Debt (debt outstanding as of June 30, 2007) -- Series 1996 ($58.1 million outstanding), the bonds maturing in 2007 and 2008 are insured by Ambac whose current financial strength rating is Aaa on watch for possible downgrade, the bonds maturing in 2011 and 2017 are insured by Connie Lee whose insurance policy on this transaction has not been rated; -- Series 2002 ($135.0 million outstanding) BMO FINANCIAL: To Write Down CA$495 Million Over Trusts' Mishap --------------------------------------------------------------- BMO Financial Group, dba Bank of Montreal, will make a CA$495 million writedown on two asset-backed commercial-paper due to increasing woes in Canada's securities market. Apex & Sitka Trusts As of Feb. 19, 2008, BMO was continuing its discussions with a number of counterparties on restructuring alternatives for Apex and Sitka Trusts. The conduit's underlying positions are super senior positions with exposures to high quality diversified corporate debt through collateralized debt obligations. The ratings on these positions continue to be rated AAA, although they are under review. Charges taken in BMO's fourth quarter 2007 and first quarter 2008 in connection with Apex and Sitka Trusts total CA$210 million, leaving BMO with a net position of CA$495 million. The charges that BMO has taken reflect its expectations with respect to the probability of Apex and Sitka Trusts being restructured. As of Feb. 19, 2008, BMO asserted that if Apex and Sitka is not restructured, it expects to incur an additional charge that would approximate its remaining net investment of CA$495 million pre- tax. If BMO determines it is in its interest to do so, it may provide additional support to Apex and Sitka Trusts. Apex/Sitka Missed Restructuring Deadline Several reports said that BMO missed a deadline of the restructuring of two trusts, Apex and Sitka. The report notes that BMO had previously indicated the writing down of its entire holding in both trusts unless both trusts can solve their financial issues through restructuring. Capital analyst at BMO, Ian de Verteuil, revealed that at least 50% of Apex Trust's assets are notes issued by Sitka Trust, Reuters says. Caldwell Securities portfolio manager John Kinsey commented that he is discouraged by the news about BMO, which Mr. Kinsey called "a conservative, well-managed squeaky-clean bank." The Bank of Montreal is considered as Canada's most conservative bank. Standstill Agreement The reports say that BMO's restructuring plan involving several billions of dollars worth of frozen non-bank ABCP is also under threat due to the crisis in the financial market. RBC Capital Markets analyst Andre-Philippe Hardy told Financial Post about bigger threats to the success of a restructuring because of wider credit spreads. A standstill agreement among a group of Canadian banks, under which the banks won't require putting up security to obligations, expired a week ago, reports reveal. The group, headed by Purdy Crawford, Esq., in Toronto, aims at the restructuring of $33 billion worth of Canadian ABCP sold by non-bank dealers, Bloomberg News says. However, Ricardo Pascoe of the National Bank of Canada, a member of the group, told reporters that the standstill agreement still holds and added that "all parties are fully engaged; there has been no break of the standstill [agreement]." Mr. Pascoe assured that "a successful conclusion" will soon be reached, Bloomberg relates. Mr. Hardy, according to Financial Post, expressed that the banks' fading support for the restructuring is the reason why no extension to the standstill agreement has been disclosed. He added that "deterioration in the market . . . could derail the restructuring," Financial Post reports. Markit, market information provider in the U.K., that the value of credit swaps, including frozen ABCP, is now at its lowest level in more than five years, Financial Post notes. Based on the report, banks will temporarily allow weekly extension to the standstill agreement. DBRS Cuts Ratings on Apex and Sitka On Feb. 28, 2008, rating agency DBRS downgraded Apex and Sitka to R-5, its lowest short-term debt rating, and CCC, its fourth-lowest speculative long-term rating. The negative rating action followed the bank's disclosure that Apex failed to find buyers for all of its notes that came due. DBRS said a default by Apex would result in a default by Sitka. The rating downgrade exposes the bank to further losses, in addition to its previously announced CA$130 million writedown on its investment in the trusts. BMO is due to report its first-quarter 2008 financial results on Tuesday. During the fourth quarter ended Oct. 31, 2007, the company had a net income of $452 million, down $244 million or 35%, from the same quarter a year ago. Net income for the fiscal year 2007 was $2,131 million, down $532 million, or 20%, for the fiscal year 2006. S&P Ratings Unaffected By Likely Write-Offs On Feb. 28, 2008, Standard & Poor's Ratings Services said its ratings on the Bank of Montreal (BMO; A +/Stable/A-1) and its subsidiaries remain unchanged following reports that the bank could face up to CA$495 million in additional write-offs related to two of its asset-backed commercial paper trusts that it sponsors. According to S&P, the problems surrounding Apex and Sitka are just part of the bad news BMO has been facing in a tough capital markets environment. Although the prospect of yet another substantial write-off early in the reporting season is clearly a disappointing start to fiscal 2008, and although the bank's bottom line results will suffer, BMO's financial position is strong enough to manage the additional burden without any ratings impact. S&P said that the ratings reflect its expectation of a continued difficult operating environment, including uncertainties in capital markets, domestic competitive challenges, and reduced operating margins. Four Ratings Agencies Confirm Ratings On Feb. 19, 2008, DBRS (AA), Fitch (AA-), Moody's (Aa1), and Standard & Poor's (A+) affirmed their ratings on Bank of Montreal, BMO said. The rating outlook is stable for all ratings. BMO Financial Group disclosed certain matters relating to its first quarter earnings which will be released on March 4, 2008, and to the Links and Parkland Structured Investment Vehicles, and certain senior management changes. About BMO Financial Group Established in 1817 as Bank of Montreal, BMO Financial Group (TSX, NYSE: BMO) -- http://www2.bmo.com/-- is a diversified financial services organization. With total assets of $367 billion at Oct. 31, 2007, and almost 36,000 full-time employees worldwide, BMO serves a broad range of personal, commercial, corporate and institutional customers. BMO FINANCIAL: Discloses Financial Updates for First Quarter 2008 ----------------------------------------------------------------- BMO Financial Group, dba Bank of Montreal, disclosed charges to first quarter earnings and provided further clarity around certain off-balance sheet vehicles managed by BMO Financial Group. BMO will hold an annual meeting of its shareholders March 4, 2008. Asset Valuations at Quarter End BMO Financial Group said it expects first quarter results for the three months ended Jan. 31, 2008, to include: -- charges in BMO Capital Markets for certain trading activities and valuation adjustments of approximately CA$490 million pre-tax (CA$325 million after tax). The charges relate to: i. Certain transactions previously hedged with ACA Financial Guaranty Corporation, a monoline insurer, about $160 million pre-tax. BMO has liquidated these positions and has no further exposure to ACA or transactions that were hedged with ACA. ii. Trading and structured credit-related positions, preferred shares, third party Canadian conduits and other mark to market losses, about CA$175 million pre-tax. iii. BMO's investment in Apex/Sitka Trust, approximately $130 million pre-tax. This is in addition to the $80 million charge taken in Q4, 2007. Apex/Sitka Trust is a structured finance vehicle to which BMO has not provided backup liquidity. iv. Capital notes in the Links Finance Corporation and Parkland Finance Corporation SIVs, approximately CA$25 million pre-tax. BMO's remaining capital notes are valued at approximately CA$30 million. -- an increase to the general allowance for credit losses to reflect portfolio growth and risk migration, approximately CA$60 million pre-tax (CA$40 million after tax). These items will lower earnings per share in the first quarter by about 70 Canadian cents. BMO's Tier 1 Capital Ratio remains strong and was 9.51% as at Oct. 31, 2007 under the Basel I methodology. BMO is in the process of completing its review and final first quarter closing procedures. Accordingly, the financial information is based on current estimates and is subject to change. BMO will release its first quarter 2008 results on March 4, 2008. Structured Investment Vehicles BMO also disclosed a proposal to provide senior ranked support for the funding of Links Finance Corporation and Parkland Finance Corporation. Execution of the definitive agreement to provide support will depend on a number of factors, including approvals of the terms by the SIV boards. BMO liquidity facilities will backstop the repayment of senior note obligations to facilitate SIVs access to further senior funding, provide the SIVs with supplemental funding, and permit the SIVs to continue the strategy of selling assets in an orderly manner. Since July 31, 2007, the assets in Links have been reduced from $23.4 billion to $12.3 billion and the assets in Parkland have been reduced from EUR3.4 billion to EUR1.2 billion, in both cases net of cash. This reduction principally reflects progress to date in the strategy to reduce the size of the SIVs. BMO said given current market conditions, it is proposing these liquidity facilities to facilitate the continued orderly management of the SIVs, while balancing the interests of its shareholders, clients and debt holders. The proposed liquidity facilities, which include previous financial support provided by BMO, will be capped at a maximum of approximately $11 billion related to Links and EUR1.2 billion for Parkland. Given the terms and conditions of the proposed liquidity facilities and the maturity profile of the senior notes, the amount to be drawn is expected to be approximately one half of the amount of the maximum amount of the facilities. The strength of BMO's financial position as well as the quality of the SIVs' assets allows BMO to extend this support without any material adverse impact on its financial position: -- Risk of loss of these proposed facilities is low: i. The asset quality of the SIVs is high; over 90% of assets are rated AA or better by Moody's and over 80% by Standard & Poor's. Certain of these ratings are on watch. There is minimal exposure to U.S. sub-prime mortgages. ii. Capital note holders will continue to bear the economic risk from actual losses up to the full amount of their investment. BMO is not providing any protection from the economic risk to capital note holders, now or in the future. The net asset values of the capital notes as at February 12th are about $877 million for Links and about EUR146 million for Parkland. iii. The risk of loss for BMO under the proposed arrangement is considered low given the high asset quality and the fact that the advances under the liquidity facilities will rank ahead of the subordinate capital note holders. -- The impact on Tier 1 Capital is not material. -- The amount of these liquidity facilities represents approximately 3% of BMO's total assets at Oct. 31, 2007. -- Asset sales and maturities and the maturity profile of the senior notes reduce the size of the expected funding to a level significantly below the full amount of the liquidity facilities. About BMO Financial Group Established in 1817 as Bank of Montreal, BMO Financial Group (TSX, NYSE: BMO) -- http://www2.bmo.com/-- is a diversified financial services organization. With total assets of $367 billion at Oct. 31, 2007, and almost 36,000 full-time employees worldwide, BMO serves a broad range of personal, commercial, corporate and institutional customers. BMO FINANCIAL: Senior Management Changes to Take Effect March 5 --------------------------------------------------------------- BMO Financial Group, dba Bank of Montreal, said it would be implementing a number of senior management changes reflecting its ongoing succession plans. All the changes are effective from March 5, 2008, one day after its annual meeting of shareholders. Thomas E. Flynn is appointed Chief Risk Officer, BMO Financial Group, taking over from Robert L. McGlashan who announced his intention to retire late last year. Mr. Flynn has served as Interim Chief Financial Officer since October 2007. Prior to that, he was Executive Vice-President, Finance and Treasurer. He joined the Company in 1992 and went on to serve in a number of senior roles within the BMO Capital Markets business, including serving as Head of the Financial Services Corporate and Investment Banking Group. He will report to Bill Downe, President and Chief Executive Officer of BMO Financial Group. Russel C. Robertson joins BMO Financial Group as Interim Chief Financial Officer from Deloitte and Touche LLP in Toronto where he has served as Vice-Chairman since 2002. Mr. Robertson began his career in 1969 with Arthur Andersen LLP in Toronto and held a number of increasingly senior roles in that company including Canadian Managing Partner. He is an experienced audit partner with extensive financial services experience. Most recently at Deloitte and Touche he has been lead client service partner for BMO Financial Group. In his new role, he will also report to Mr. Downe. Thomas V. Milroy is appointed Chief Executive Officer of BMO Capital Markets succeeding Yvan Bourdeau. Mr. Milroy has been Co- President of BMO Capital Markets for the past two years. He joined BMO in 1994 and has held increasingly senior roles within BMO Capital Markets. He will report to Mr. Downe. In his new role, Mr. Bourdeau will become Vice-Chair BMO Capital Markets with accountability for account coverage, while continuing to focus on the execution of the company's China/international objectives. He has been with the company since 1972 and served in numerous key positions across the bank. Concurrent with these changes, Eric Tripp, who also served as Co- President of BMO Capital Markets, will assume the new position of President, BMO Capital Markets. He will report to Tom Milroy. Mr. Tripp joined BMO in 1994 and since then has held increasingly responsible positions within the company. Commenting on these appointments, Mr. Downe said: "In line with our ongoing succession plans, these changes maintain our strong leadership team and position us well for the future as we push ahead with our aggressive agenda. "[Thomas] Flynn's experience in our Capital Markets business and senior finance roles has made him well suited to lead the Risk function as we move ahead with plans to enhance all aspects of our Risk Management. I welcome Russel Robertson to his interim role within BMO as Karen Maidment continues with her health treatment. He is a respected and experienced executive who knows our Company and the financial services industry well and can hit the ground running as CFO. [Thomas] Milroy has demonstrated that he has the experience and vision to lead BMO Capital Markets and he will be ably supported by Eric Tripp with whom he has partnered so well in the past. Yvan Bourdeau has served BMO with distinction in his long career and will continue to do so as Vice-Chair. Finally, I thank [Robert] McGlashan for his 35 years of dedicated service to BMO and wish him well for his upcoming retirement." About BMO Financial Group Established in 1817 as Bank of Montreal, BMO Financial Group (TSX, NYSE: BMO) -- http://www2.bmo.com/-- is a diversified financial services organization. With total assets of $367 billion at Oct. 31, 2007, and almost 36,000 full-time employees worldwide, BMO serves a broad range of personal, commercial, corporate and institutional customers. BRETT LONG: Voluntary Chapter 11 Case Summary --------------------------------------------- Debtor: Brett J. Long 4325 West Dickman Road Battle Creek, MI 49037 Bankruptcy Case No.: 08-01654 Chapter 11 Petition Date: February 28, 2008 Court: Western District of Michigan (Grand Rapids) Debtor's Counsel: Kerry D. Hettinger, Esq. (khett57@hotmail.com) Hettinger & Hettinger, P.C. 200 Admiral Avenue Portage, MI 49002-3503 Tel: (269) 344-1100 Estimated Assets: $500,000 to $1 million Estimated Debts: $1 million to $10 million The Debtor did not file a list of its largest unsecured creditors. BRITT METAL: Case Summary & 18 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Britt Metal Processing, Inc. 15800 Northwest 49th Avenue Miami Gardens, FL 33014 Bankruptcy Case No.: 08-12166 Type of Business: The Debtor manufactures aircraft parts. Chapter 11 Petition Date: February 26, 2008 Court: Southern District of Florida (Miami) Debtor's Counsel: D. Jean Ryan, Esq. Ryan & Dunn, P.A. P.O. Box 561507 Miami, FL 33256 Tel: (305) 275-2733 ryandunncourtmail@ryan-dunn.com Estimated Assets: $1 million to $10 million Estimated Debts: $1 million to $10 million Debtor's list of its 18 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Miami Dade Tax Collector Real Estate $101,000 P.O. Box 025218 Property Tax Miami, FL 33102-5218 Tangible Taxes $16,000 Tabas, Joel Esq. Litigation Support $49,426 Tabas, Freedman & Soloff 25 Southeast 2 Avenue, Suite 919 Miami, FL 33131-1538 Jacobson Sobol Mossele Collections Attorney $20,533 P.O. Box 19359 Plantation, FL 33318-0359 Morrison, Brown, Argiz Litigation Sup