T R O U B L E D C O M P A N Y R E P O R T E R Thursday, March 6, 2008, Vol. 12, No. 56 Headlines ACA ABS: Eroding Credit Quality Prompts Moody's Rating Downgrades AES CORP: Defaults on Debt Facilities due to Misrepresentation AMBAC FINANCIAL: Investors Dislike Recapitalization; Shares Down AMERICAN NATURAL: June 30 Balance Sheet Upside-Down by $16.2 Mil. ARCA FUNDING: Moody's Junks Rating on $70 Mil. Senior Notes ASAT HOLDINGS: Expects 4% Revenue Growth in 2008 Third Quarter ASSET BACKED: Fitch Puts 'BB+' Rating Under Negative Watch BANC OF AMERICA: S&P Upgrades Ratings on Eight Classes of Certs. BELLACH'S LEATHER: Case Summary & 17 Largest Unsecured Creditors BERRY PLASTICS: B. Scheu Takes Helm at Rigid Closed Top Division BGF INDUSTRIES: Inks $75 Mil. Loan Agreement with Various Lenders BNC MORTGAGE: Fitch Downgrades Ratings on $1.5B Certificates BUILDERS TRANSPORT: Judge Massey Confirms Joint Liquidation Plan CATHOLIC CHURCH: Fairbanks Wants Quarles & Brady as Counsel CATHOLIC CHURCH: Portland Needs No Special Master, Erin Olson Says CDC MORTGAGE: Eroding Credit Support Cues S&P's Rating Downgrades CELL THERAPEUTICS: Issues $51 Mil. of 9% Convertible Senior Notes CHARYS HOLDING: Taps Richards Layton as Bankruptcy Co-Counsel CHRYSLER LLC: Can Have Unlimited Access to Daimler AG's Technology CLAYTON STINE: Voluntary Chapter 11 Case Summary CLEAR CHANNEL: Trial on Sale Funding Dispute Set for April 7 COLLEZIONE EUROPA: Blames Sales Drop to Customers Rhodes, Levitz COMPTON PETROLEUM: Board Checks Review Plans, Strategic Options CONSECO INC: Extends Annual Report Filing Deadline to March 17 COUDERT BROTHERS: Dechert Wants to Dip Hands Into Escrowed Fund COVANTA HOLDING: Earns $72 Million in Quarter Ended December 31 COVENANT CHRISTIAN: Case Summary & 19 Largest Unsecured Creditors DAYTON SUPERIOR: Completes Refinancing of 10-3/4% Sr. Sec. Notes DEERFIELD CAPITAL: S&P Chips Rating to B on Weak Capital Position DELPHI CORP: Gets Exit Financing Proposal from Former Parent GM DIS DIAGNOSTIC: Case Summary & Eight Largest Unsecured Creditors DOV PHARMACEUTICAL: Reduces Monthly Payments and Office Lease Term DRESSER-RAND: Earnings Rise to $44MM in Quarter Ended December 31 ELF SPECIAL: S&P Lifts Rating on $462.5 Mil. Senior Notes to 'B+' ENECO INC: Creditors Want Case Dismissed or Converted to Chapter 7 ENVIRONMENTAL TECTONICS: AMEX Agrees to Review Delisting ENVIROSOLUTIONS HOLDINGS: Moody's Junks Ratings on Risk of Default ENVIROSOLUTIONS: S&P Junks 'B-' Ratings on Covenant Violations EXIDE TECHNOLOGIES: Moody's Sees Positive Outlook for Caa1 Rating FIELDSTONE MORTGAGE: U.S. Trustee Appeals Retention Payments FIRST FRANKLIN: Fitch Rates $13.8MM Class B-4 Certificates BB+ FIRST FRANKLIN: Fitch Lowers Ratings on $7.2 Billion Certificates FOCUS CAPITAL: To Liquidate After Missing Banks' Margin Calls FORTUNOFF: Gets Final OK to USE BoFA's $85 Million DIP Facility FORTUNOFF: Can Use Lenders' Cash Collateral on Final Basis FORTUNOFF: Committee Selects Otterbourg Steindler as Counsel FORTUNOFF: Creditors' Panel Taps Cohen Tauber as Special Counsel FREMONT GENERAL: S&P Slashes Rating to 'CC' on Covenant Default FREMONT INVESTMENT: S&P Removes Company From Select Servicer List GENERAL MOTORS: Offers Additional Exit Financing to Delphi Corp. GENERAL MOTORS: Key Supplier Labor Strike Affects More GM Plants GENESCO INC: Terminates Finish Line-Merger and Settles Dispute GENESCO INC: S&P Holds B+ Rating on Finish Line Merger Termination HOME EQUITY: S&P Ratings on Class B-2 Tumbles to 'D' From 'CCC' IMAGING SPECIALISTS: Case Summary & 20 Largest Unsecured Creditors INDIANTOWN COGENERATION: Fitch Holds 'BB' Rating on $505MM Bonds INDYMAC HOME: Moody's Reviews 19 Tranches' Ratings for Likely Cuts INERGY LP: Buys Retail Division of Farm & Home from Buckeye INERGY LP: Purchase Agreements Will Not Affect S&P's 'BB-' Rating INGEAR CORP: U.S. Trustee Appoints Five-Member Creditors Panel INGEAR CORP: Wants to Hire Perkins Coie as Bankruptcy Counsel INVERNESS MEDICAL: Incurs $12.5 Mil. Net Loss for 2007 Fourth Qtr. INVERNESS MEDICAL: In Talks with Lenders to Amend Matria Deal JD INVESTMENT: Case Summary & 20 Largest Unsecured Creditors JOHNSON ENTERPRISES: Case Summary & Largest Unsecured Creditor JOSEPH MARTINO: Case Summary & Nine Largest Unsecured Creditors JP MORGAN: Fitch Chips Ratings on $1.1 Billion Certificates LEHMAN BROTHERS: Fitch Assigns 'BB' Rating on Two Cert. Classes LEVITT AND SONS: Depositors Panel Wants to Validate Florida Claims LOCHMOOR CLUB: Voluntary Chapter 11 Case Summary LODGENET INTERACTIVE: Inks New Rights Agreement with Computershare LOUISIANA WORSHIP: To Sell Grand Palace Hotel on April 17 MALLIE HUNT ADAMS: Voluntary Chapter 11 Case Summary MATRIA HEALTHCARE: Buyer in Talks to Restructure Acquisition Offer MEDIACOM COMMS: Moody's Holds 'B1' Ratings on High Financial Risk MEDICURE INC: To Dismiss 50 Employees, Consultants Next Month MERRILL LYNCH: S&P Junks Ratings on Two Classes of Certs. MH 7 PROPERTIES: Section 341(a) Meeting Scheduled for March 18 MKW RANCH: Voluntary Chapter 11 Case Summary MORGAN STANLEY: S&P's Junks Rating on Class B-3 Certificates NASDAQ OMX: Inks $2.075 Billion Senior Secured Loan Agreement NASDAQ OMX: Completes Offering of $425 Mil. of Convertible Notes NAVIGATORS CARSON'S: Case Summary & List of Unsecured Creditors NEUMANN HOMES: Clublands Sale Bidding Procedure Approved NEW YORK RACING: Obtains Court Approval to Sell Ancillary Property OSCEOLA RIDGE: Case Summary & 52 Largest Unsecured Creditors OWNIT MORTGAGE: Declining Credit Support Prompts S&P's Rating Cuts PACIFIC LUMBER: Court Approves Panel's Disclosure Statement PACIFIC LUMBER: Court Approves $3 Settlement of Qui Tam Claims PDL BIOPHARMA: Abandons Sale; Plans to Lay Off 260 More Workers PDL BIOPHARMA: Posts $21.1M Loss for Full Year Ended Dec. 31 PERFORMANCE TRANS: Court Approves Protocol to Sell All Assets PERFORMANCE TRANS: Bonus Program for Non-Exec Workers Approved PETRO ACQUISITIONS: Village Pantry Buys AmeriStop Market Stores PFP HOLDINGS: Asks Court to OK Use of Lenders' Cash Collateral PGT INC: Reduces Workforce by 17% as Restructuring Measure PIKE NURSERY: 16 Locations Sold to Armstrong Garden for $5.2 Mil. PIKE NURSERY: Wholesale Inventory and Locations Sold to 3 Buyers PILOT MOUNTAIN: Voluntary Chapter 11 Case Summary PINNACLE ENT: Posts $19 Mil. Net Loss in Quarter Ended December 31 PLAINS EXPLORATION: Sells Oil Interests in Permian and Piceance PMB HYDRA-SCREW: Case Summary & List of 20 Unsecured Creditors QUEBECOR WORLD: WEB Printing Backs Printing Suppliers' Objections QUEBECOR WORLD: Reaches Settlement with Utility Providers QUEBECOR WORLD: Wants Banc of America Aircraft Lease Rejected QUEBECOR WORLD: Flint Group, et al., Balk at $1 Bil. DIP Facility R&B CONSTRUCTION: Sec. 341(a) Creditors' Meeting Set for Mar. 14 RASC SERIES: Class B Certs. Acquire S&P's Junk Rating RED MILE: Simon Price Takes Over as President Effective March 1 RELIANT ENERGY: S&P Upgrades Rating on Debt Facilities to 'BB-' RENAISSANCE HOME: S&P Rating on Class B Tumbles to 'D' From 'CCC' RITCHIE (IRELAND): Court Refuses to Review Case Against Coventry RUSSELL SMITH: Voluntary Chapter 11 Case Summary RYAN'S RIDGE: Case Summary & Four Largest Unsecured Creditors SALOMON BROTHERS: S&P Junks Rating on Class B-2 Certs. From 'BB' SASCO: Fitch Chips Ratings on $3.5 Billion Certificates SATCON TECHNOLOGY: Secures $10 Million Revolving Credit Facility SIMPLON BALLPARK: Voluntary Chapter 11 Case Summary SIRIUS SATELLITE: S&P Puts 'CCC+' Ratings on Developing Watch SIRVA INC: Agrees with Creditors on Prepetition Claims Payment SIRVA INC: Court Approves Hiring of Kirkland & Ellis as Attorney SIRVA INC: Court Approves Motion to Hire E&Y as Accountant SIRVA INC: Court Okays Motion to Reject Devens, Bridgewater Leases SLM CORP: Moody's Pares Preferred Stock Rating to 'Ba1' From Baa3 SMART MODULAR: Completes $20 Million Buyout of Adtron Corporation SOCIETE GENERALE: Fitch Junks Ratings on Six Certificate Classes SOLUTIA INC: Flexsys Unit Raises Prices to Ensure Reinvestment SOLUTIA INC: Settlement Gives GE Betz $255,575 in Allowed Claim SOLUTIA INC: To Issue 7,450,000 Shares For Employee Plans STRADA 315: Seeks Court Nod on Using Law Firm's Cash Collateral STRADA 315: Section 341(a) Creditors' Meeting Set for March 20 STRADA 315: Gets Interim Nod to Employ Genovese Joblove as Counsel SUN COAST: Court Approves $19.8 Mil. Asset Sale to Largo Medical TERAVICTA TECHNOLOGIES: Files Chapter 7, Lays Off 50 Workers THORNBURG MORTGAGE: Fitch Rates $1.983MM Class B5 Certs. 'B' TLC VISION: Completes Amendments to $110 Million Credit Facility TOWERS OF CHANNELSIDE: U.S. Trustee Forms 5-Member Creditors Panel TWEETER HOME: Court Extends Plan-Filing Exclusive Period to June 5 US AIRWAYS: Resolves Dispute with Boston City By Paying $1,880,000 US AIRWAYS: Gets Approval to Modify Agreements with United US AIRWAYS: Employees Wants Management to Address Labor Issues US AIRWAYS: Various Entities Disclose Ownership of Interest UTGR INC: Weak Credit Metrics Spurs S&P's Rating Downgrade to 'B-' VALEANT PHARMA: To Restate Financial Statements Due to Errors VALLEJO CITY: Council Approves Plans to Avoid Bankruptcy VONAGE HOLDINGS: May Modify Terms of $253 Million Convertible Debt WELLS FARGO: Fitch Downgrades Ratings on $536.8MM Certificates WESTWAYS FUNDING: Moody's Reviews Nine Note Ratings for Downgrade XM SATELLITE: S&P Puts 'CCC+' Ratings on CreditWatch Developing ZIFF DAVIS: Files Chapter 11 Protection in New York ZIFF DAVIS: Case Summary & 30 Largest Unsecured Creditors * Moody's Sees Inauspicious Recovery of CDO Performance in 2008 * Moody's Reports on Refunding Risks for Speculative-Grade Issuers * S&P Downgrades 52 Tranches' Ratings From 11 Cash Flows and CDOs * Fitch Believes Airport Credit Quality Will Remain Stable in 2008 * Fitch Says Increase in Loans Drove US CDO Delinquencies Up * February Bankruptcy Filings Rise 28% Compared to Last Year * Beard Group's Cross-Border Insolvencies Audio Primer * Fulbright & Jaworski Selects Eleven Lawyers to Join Partnership * Chapter 11 Cases with Assets & Liabilities Below $1,000,000 ********* ACA ABS: Eroding Credit Quality Prompts Moody's Rating Downgrades ----------------------------------------------------------------- Moody's Investors Service downgraded ratings of seven classes of notes issued by ACA ABS 2007-2, 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: Up to $375,000,000 Class A1 S Variable Funding Senior Secured Floating Rate Notes due July 2045 -- Prior Rating: Baa2, on review for possible downgrade -- Current Rating: B3, on review with future direction uncertain Class Description: $60,000,000 Class A1 M Senior Secured Floating Rate Notes due July 2045 -- Prior Rating: Ba1, on review for possible downgrade -- Current Rating: C Class Description: $150,000,000 Class A1 J Senior Secured Floating Rate Notes due July 2045 -- Prior Rating: Ba2, on review for possible downgrade -- Current Rating: C Class Description: $40,000,000 Class A2 Senior Secured Floating Bate Notes due July 2045 -- Prior Rating: B1, on review for possible downgrade -- Current Rating: C Class Description: $40,000,000 Class A3 Secured Deferrable Interest Floating Rate Notes due July 2045 -- Prior Rating: Caa1, on review for possible downgrade -- Current Rating: C Class Description: $42,000,000 Class B1 Mezzanine Secured Deferrable Interest Floating Rate Notes due July 2045 -- Prior Rating: Caa2, on review for possible downgrade -- Current Rating: C Class Description: $8,000,000 Class B2 Mezzanine Secured Deferrable Interest Floating Rate Notes due July 2045 -- Prior Rating: Ca -- Current Rating: C The rating actions reflect deterioration in the credit quality of the underlying portfolio, as well as the occurrence on Oct. 16, 2007, as reported by the Trustee, of an event of default caused by a failure of the Senior Credit Test to be satisfied, as set forth in Section 5.1(h) of the Indenture dated June 28, 2007. This event of default is still continuing. ACA ABS 2007-2, Ltd. is a collateralized debt obligation backed primarily by a portfolio of RMBS securities. As provided in Article V of the Indenture during the occurrence and continuance of an Event of Default, holders of certain 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 outstanding Class A1S Funded Amount and the principal of the Notes to be immediately due and payable. Furthermore, according to the Trustee, holders of a majority of the Controlling Class have directed the Trustee to direct the disposition 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 timing and outcome of the liquidation. Because of this uncertainty, the ratings assigned to the Class A-1S Notes remain on review for possible further action. AES CORP: Defaults on Debt Facilities due to Misrepresentation -------------------------------------------------------------- The AES Corporation is in default under its senior secured credit facility and its senior unsecured credit facility due to a breach of representation related to its financial statements as set forth in the credit agreements. As a result, $200 million of the debt under the company's senior secured credit facility will be classified as current on the balance sheet as of Dec. 31, 2007. There are no outstanding borrowings under the senior unsecured facility. The company will seek a waiver of these defaults from its lenders under these facilities. The company may not borrow additional funds under either of these facilities until it obtains the waiver. The company would delay the filing of its 2007 Annual Report on Form 10-K with the Securities and Exchange Commission. The company discloses that it is still preparing its financial statements as a result of its efforts to remediate the disclosed material weaknesses. In addition, the company relates that financial statements for the years ended Dec. 31, 2005, and 2006, of the company's independent registered public accounting firm, Deloitte & Touche LLP, could no longer be relied upon. Although the company provides no assurance that it will able to file its 2007 Form 10-K within the 15 calendar day extension period it relates that the Form 10-K will be filed within the extension period. About AES Corporation AES Corporation -- http://www.aes.com/-- a global power company, operates in South America, Europe, Africa, Asia and the Caribbean countries. Generating 44,000 megawatts of electricity through 124 power facilities, the company delivers electricity through 15 distribution companies. AES has been in Eastern Europe for over ten years, since it acquired three power plants in Hungary in 1996. Currently, AES has two distribution companies in Ukraine, which serve 1.2 million customers and generation plants in the Czech Republic and Hungary. AES is also the leading company in biomass conversion in Hungary, generating 37% of the nation's total renewable generation in 2004. * * * As reported in the Troubled Company Reporter on Nov. 21, 2007, the. (AES: B1 Corporate Family Rating) has completed its offer to purchase up to $1.24 billion of outstanding senior notes. While no ratings changed as a result, the LGD point estimate on its senior secured credit facilities were revised to LGD 1, 2%, from LGD 1, 3%, its second priority secured notes to LGD 3, 38% from LGD 3, 41% and its senior unsecured notes to LGD 4, 53% from LGD 4, 57%. AMBAC FINANCIAL: Investors Dislike Recapitalization; Shares Down ---------------------------------------------------------------- Investors are disappointed about Ambac Financial Group Inc.'s plans to receive fresh capital infusion from key banks, as reflected in the dip of Ambac's shares by 19% to $8.70, various reports indicate. Investors apparently are displeased by major banks not helping out Ambac, instead letting the monoline insurer raise capital on its own, Reuters says. As reported in the Troubled Company Reporter on Feb. 25, 2008, Ambac anticipated a proposed $3 billion financing deal offered by various banks. The deal, endorsed and largely drafted by New York insurance regulator, proposed to raise equity of $2.5 billion and issue debt of $500 million. People familiar with the issue told Reuters that it was willing to accept the $3 billion financing from the banks -- until the rating agencies advised against it. "It looks like (banks) had a close look at what was going on at Ambac, and they backed away. Things may be bad there," Reuters quotes investor Peter Kovalski as saying. Out of an issuance of $1 billion of common stock and $500 million of equity units, Ambac found only a $1 billion demand for its shares, a person familiar with the issue told Reuters. As reported in the Troubled Company Reporter on March 5, 2008, Ambac disclosed that it has no intention to split itself into two, opting instead to embrace new capital to preserve its bond insurance business. It rejected a proposal that plans to separate its municipal bond business with its structured finance business. While municipal bonds have retained its triple-A ratings, its structure finance part has not fared so well, receiving low ratings due to the nature of subprime mortgages backing the funds. Ambac plans not to involve itself with structured finance deals for the next six months, noting that it will free up additional capital approximately $600 million. 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 NATURAL: June 30 Balance Sheet Upside-Down by $16.2 Mil. ----------------------------------------------------------------- American Natural Energy Corp.'s consolidated balance sheet at June 30, 2007, showed $6,812,673 in total assets and $23,010,682 in total liabilities, resulting in a $16,198,009 total stockholders' deficit. At June 30, 2007, the company's consolidated financial statements also showed strained liquidity with $2,996,884 in total current assets available to pay $21,265,899 in total current liabilities. The company reported a net loss of $1,448,682 on revenues of $338,490 for the second quarter ended June 30, 2007, compared with a net loss of $1,009,540 on revenues of $415,756 in the same period ended June 30, 2006. Total expenses were $1.8 million for the three months ended June 30, 2007, compared with total expenses of $1.5 million for the three months ended June 30, 2006. Full-text copies of the company's consolidated financial statements for the quarter ended June 30, 2007, are available for free at http://researcharchives.com/t/s?28bb Going Concern Doubt Malone & Bailey PC, in Houston, expressed substantial doubt about American Natural Energy Corp.'s ability to continue as a going concern after auditing the company's consolidated financial statements for the year ended Dec. 31, 2006. The auditing firm reported that the company has incurred substantial losses during 2006, has a working capital deficiency and an accumulated deficit at Dec. 31, 2006, and is in default with respect to certain debenture obligations. About American Natural Based in Tulsa, Oklahoma, American Natural Energy Corporation (TSX Venture: ANR.U) -- http://www.annrg.com/-- was formed in January 2001 to focus on the acquisition, development and exploitation of oil and natural gas reserves. ANEC's objective is to grow an oil and natural gas reserve base through development, exploitation and exploration drilling within the current and future boundaries of its St. Charles Parish, Louisiana properties, including its ExxonMobil Joint Development area. ARCA FUNDING: Moody's Junks Rating on $70 Mil. Senior Notes ----------------------------------------------------------- Moody's Investors Service downgraded ratings of seven classes of notes issued by Arca Funding 2006-II, Ltd. The notes affected by the rating action are: Class Description: $70,000,000 Class II Funded Senior Notes Due 2047 -- Prior Rating: Baa3, on review for possible downgrade -- Current Rating: C Class Description: $56,000,000 Class III Funded Senior Notes Due 2047 -- Prior Rating: Ba1, on review for possible downgrade -- Current Rating: C Class Description: $28,500,000 Class IV-A Funded Mezzanine Deferrable Notes Due 2047 -- Prior Rating: B1, on review for possible downgrade -- Current Rating: C Class Description: $11,000,000 Class IV-B Funded Mezzanine Variable Notes Due 2047 -- Prior Rating: B1, on review for possible downgrade -- Current Rating: C Class Description: $36,500,000 Class V Funded Mezzanine Deferrable Notes Due 2047 -- Prior Rating: Caa2, on review for possible downgrade -- Current Rating: C Class Description: $7,000,000 Class VI Funded Mezzanine Deferrable Notes Due 2047 -- Prior Rating: Caa3, on review for possible downgrade -- Current Rating: C Class Description: $10,000,000 Class VII Funded Mezzanine Deferrable Notes Due 2047 -- 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 Feb. 21, 2008, of an event of default caused by the Class I Par Value Coverage Ratio falling below 100% pursuant Section 5.1(j) of the Indenture dated Dec. 19, 2006. This event of default is still continuing. Arca Funding 2006-II, Ltd. is a collateralized debt obligation backed primarily by a portfolio of Structured Finance securities. As provided in Article V of the Indenture during the occurrence and continuance of an Event of Default, holders of certain parties to the transaction 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 the Controlling Class has directed the Trustee to accelerate the notes and to proceed with the sale and liquidation of the Collateral. The rating downgrades taken reflect the increased expected loss associated with each tranche. Losses are attributed to diminished credit quality on the underlying portfolio. ASAT HOLDINGS: Expects 4% Revenue Growth in 2008 Third Quarter -------------------------------------------------------------- ASAT Holdings Limited expects revenue for the third quarter ended Jan. 31, 2008 of approximately $41.7 million, representing an increase of approximately 4% above second quarter fiscal 2008 revenue of $40.2 million. It is also above the guidance the company provided on Jan. 14, 2008 that said revenue will be in line with the prior quarter. The company's board of directors has approved a compensation award to its acting chief executive in the form of a warrant exercisable for an aggregate of up to 41.8 million ordinary shares at an exercise price of $0.01 per share, subject to certain adjustments. The warrant is exercisable with respect to 20.6 million ordinary shares immediately, with the remainder subject to certain vesting or performance criteria. Headquartered in Pleasanton, California, ASAT Holdings Limited (Nasdaq: ASTT) -- http://www.asat.com/-- is a provider of semiconductor package design, assembly and test services. With 18 years of experience, the company offers a definitive selection of semiconductor packages and world-class manufacturing lines. ASAT's advanced package portfolio includes standard and high thermal performance ball grid arrays, leadless plastic chip carriers, thin array plastic packages, system-in-package and flip chip. ASAT was the first company to develop moisture sensitive level one capability on standard leaded products. The company has operations in the United States, Hong Kong, China and Germany. * * * Standard & Poor's placed ASAT Holdings Limited's long-term foreign and local issuer credit ratings at 'CCC-' in September 2007. The outlook is negative. ASSET BACKED: Fitch Puts 'BB+' Rating Under Negative Watch ---------------------------------------------------------- Fitch Ratings has taken rating actions on two Asset Backed Funding Corp. mortgage pass-through certificate transactions. In one rating action, $1.7 billion was placed on Rating Watch Negative. ABFC 2007-WMC1 -- $615.6 million class A-1A rated 'AAA', placed on Rating Watch Negative; -- $104.0 million class A-1B rated 'AAA', placed on Rating Watch Negative; -- $300.8 million class A-2A rated 'AAA', placed on Rating Watch Negative; -- $74.6 million class A-2B rated 'AAA', placed on Rating Watch Negative; -- $42.6 million class M-1 rated 'AA+', placed on Rating Watch Negative; -- $42.6 million class M-2 rated 'AA', placed on Rating Watch Negative; -- $58.4 million class M-3 rated 'AA-', placed on Rating Watch Negative; -- $36.3 million class M-4 rated 'A+', placed on Rating Watch Negative; -- $36.3 million class M-5 rated 'A', placed on Rating Watch Negative; -- $26.0 million class M-6 rated 'A-', placed on Rating Watch Negative; -- $21.3 million class M-7 rated 'BBB+', placed on Rating Watch Negative; -- $19.7 million class M-8 rated 'BBB', placed on Rating Watch Negative; -- $22.1 million class M-9 rated 'BBB-', placed on Rating Watch Negative; -- $30.8 million class B-1 rated 'BB+', placed on Rating Watch Negative. Deal Summary -- Originators: 100% WMC Mortgage Corp.; -- 60+ day Delinquency: 7.06%; -- Realized Losses to date (% of Original Balance): 0.00%. ABFC 2007-NC1 -- $144.4 million class A-1 rated 'AAA', placed on Rating Watch Negative; -- $58.3 million class A-2 rated 'AAA', placed on Rating Watch Negative; -- $15.2 million class M-1 rated 'AA+', placed on Rating Watch Negative; -- $14.4 million class M-2 rated 'AA', placed on Rating Watch Negative; -- $8.7 million class M-3 rated 'AA-', placed on Rating Watch Negative; -- $7.8 million class M-4 rated 'A+', placed on Rating Watch Negative; -- $8.2 million class M-5 rated 'A', placed on Rating Watch Negative; -- $7.5 million class M-6 rated 'A-', placed on Rating Watch Negative; -- $7.7 million class M-7 rated 'BBB+', placed on Rating Watch Negative; -- $4.7 million class M-8 rated 'BBB', placed on Rating Watch Negative; -- $4.7 million class M-9 rated 'BBB-', placed on Rating Watch Negative. Deal Summary -- Originators: 100% New Century Mortgage Corp.; -- 60+ day Delinquency: 13.91%; -- Realized Losses to date (% of Original Balance): 0.22%. The rating actions are based on changes that Fitch has made to its subprime loss forecasting assumptions. The updated assumptions better capture the deteriorating performance of pools from 2007, 2006 and late 2005 with regard to continued poor loan performance and home price weakness. BANC OF AMERICA: S&P Upgrades Ratings on Eight Classes of Certs. ---------------------------------------------------------------- Standard & Poor's Ratings Services raised its ratings on eight classes of commercial mortgage pass-through certificates from Banc of America Large Loan Inc.'s series 2006-BIX1. Concurrently, S&P affirmed its ratings on the class K and L certificates and removed them from CreditWatch with negative implications, where they were placed on Jan. 31, 2008. In addition, S&P affirmed its ratings on 15 other classes from this series. The upgrades and affirmations reflect increased credit enhancement levels resulting from loan payoffs and follow Standard & Poor's analysis of the remaining loans in the pool. S&P affirmed the ratings on the class K and L certificates and removed them from CreditWatch with negative implications following its analysis of the Bassett Place Mall and Ballantyne Village loans. These loans were transferred to the special servicer in January 2008 and are described in detail below. As of the Feb. 15, 2008, remittance report, the trust collateral consisted of the senior participation interests in 10 floating- rate, interest-only mortgage loans, one floating-rate, interest- only whole-mortgage loan, and two interest-only floating-rate pari passu mortgage loans. All of the loans are indexed to one-month LIBOR. The pool balance has declined 53% to $537.4 million since issuance. All of the remaining loans have maturities in 2008, with extension options remaining. To date, the trust has experienced no losses. The master servicer, Bank of America N.A., has indicated that since the remittance report date, one of the remaining loans, Midtown Centre, with a pooled trust balance of $26.0 million (5%) and a nonpooled balance of $2.0 million, has paid in full. The nonpooled balance provides 100% of the cash flows for the M-MC certificates. The 'CP' and 'CA' raked certificates derive 100% of their cash flows from the CarrAmerica Pool 3 National portfolio and CarrAmerica Pool 2 CAR portfolio loans, respectively. The leverage of both loans decreased following collateral releases since issuance, which contributed to the upgrades of most of the raked certificates. The largest loan in the pool, CarrAmerica Pool 3 National portfolio, has a whole-loan balance of $694.4 million consisting of a $491.8 million senior participation that is split into three pari passu pieces and a $202.6 million junior participation that is held outside the trust. The senior participation is further divided into two portions: a senior pooled component totaling $434.1 million and a subordinate nonpooled component with a balance of $57.7 million. The trust's portion of the pooled balance is $173.6 million (32%), and its portion of the nonpooled balance is $23.1 million, which is raked to the J-CP, K-CP, and L- CP certificates. In addition, the borrower's equity interests in the properties secure a $217.9 million mezzanine loan. The trust balance reflects $431.1 million in paydowns since issuance due to collateral releases. The remaining collateral securing the largest loan includes fee and/or leasehold interests in a portfolio of 23 suburban office properties and a pledge of refinance and sale proceeds on 14 joint venture or wholly owned office properties in various locations. The master servicer reported a debt service coverage of 2.34x for the nine months ended Sept. 30, 2007, and 85% occupancy for the year ended Dec. 31, 2007. Standard & Poor's adjusted net cash flow for the remaining properties has increased 8% since issuance. The loan matures August 2008 and has three one-year extension options remaining. The ninth-largest loan in the pool, CarrAmerica Pool 2 CAR portfolio, has a whole-loan balance of $82.0 million consisting of a $59.2 million senior participation that is split into three pari passu pieces and a $22.8 million junior participation that is held outside the trust. The senior participation is further divided into two portions: a senior pooled component totaling $50.7 million and a subordinate nonpooled component with a balance of $8.5 million. The trust's portion of the pooled balance is $20.3 million (4%), and its portion of the nonpooled balance is $3.4 million, which is raked to the J-CA, K-CA, and L-CA certificates. In addition, the borrower's equity interests in the properties secure a $21.6 million mezzanine loan. The trust balance reflects paydowns of $66.2 million since issuance due to collateral releases. The remaining collateral securing the ninth-largest loan includes fee interests in four suburban office properties in Austin, Texas, and Mountain View and San Mateo, California. The master servicer reported a DSC of 2.13x for the six months ended June 30, 2007, and 89% occupancy for the year ended Dec. 31, 2007. Standard & Poor's adjusted NCF for the remaining properties has decreased 19% since issuance. The loan matures in August 2008 and has three one-year extension options remaining. This resulting valuation decline was offset by the deleveraging of the loan, as releases occurred at a premium to the allocated loan amount ranging from 110% to 115%. Details concerning the two loans with the special servicer are: -- The Bassett Place Mall, the sixth-largest loan in the pool, with a trust balance of $35.0 million (7%) and a whole-loan balance of $60.4 million, was transferred to the special servicer, Bank of America N.A., on Jan. 10, 2008, after it failed to meet its 1.03x DSC hurdle test to extend its Jan. 4, 2008, maturity date. The loan is secured by 507,000 sq. ft. of a 590,100-sq.-ft. regional retail center in El Paso, Texas. The special servicer is currently working out certain terms with the borrower to resolve the default. Standard & Poor's incorporated the borrower's full-year 2007 property financial performance information and occupancy of 93% from the January 2008 rent roll into its analysis to derive a valuation that has declined 7% since issuance. -- Ballantyne Village, the seventh-largest loan in the pool, has a trust balance of $31.5 million (6%) and whole-loan balance of $50.0 million. The loan, secured by a 166,000-sq.-ft. class A lifestyle center in Charlotte, North Carolina, was transferred to the special servicer on Jan. 25, 2008. The loan was transferred after the borrower submitted a request to restructure the loan due to a decline in cash flow resulting from two of the largest tenants not making their rental payments. The borrower has remained current on its debt service payments. Standard & Poor's used the borrower's operating statements for the nine months ended Sept. 30, 2007, and fourth-quarter 2007 budget information, as well as the November 2007 94% occupancy data for the property, to arrive at a valuation that has declined 14% since issuance. Despite the declines, the valuations of the specially serviced assets still support the outstanding ratings. Standard & Poor's will continue to monitor the resolution process to determine if future rating action is warranted. Any workout or special servicing fees will be first absorbed by the junior participation interest. The fourth-largest loan in the pool, Desert Sky Mall, is on the master servicer's watchlist. The loan, secured by 444,600 sq. ft. of an 890,400-sq.-ft. enclosed regional mall in Phoenix, Arizona, has a trust balance of $40.0 million (7%) and a whole-loan balance of $51.5 million. For the year ended Dec. 31, 2007, reported DSC was 2.21x and occupancy was 96%. Standard & Poor's adjusted NCF was comparable to its level at issuance. The master servicer placed this loan on its watchlist because of its March 2008 maturity date. The borrower intends to exercise one of the three one-year extension options. Ratings Raised Banc of America Large Loan Inc. Commercial mortgage pass-through certificates series 2006-BIX1 Rating ------ Class To From Credit enhancement ----- -- ---- ------------------ C AAA AA+ 36.76% D AAA AA 28.87% E AA+ AA- 23.60% J-CP A+ BBB N/A K-CP A- BBB- N/A L-CP BBB BB+ N/A J-CA BBB BBB- N/A K-CA BBB- BB+ N/A Ratings Affirmed and Removed From CreditWatch Negative Banc of America Large Loan Inc. Commercial mortgage pass-through certificates series 2006-BIX1 Rating ------ Class To From Credit enhancement ----- -- ---- ------------------ K BBB BBB/Watch Neg 3.52% L BBB- BBB-/Watch Neg N/A Ratings Affirmed Banc of America Large Loan Inc. Commercial mortgage pass-through certificates series 2006-BIX1 Class Rating Credit enhancement ----- ------ ------------------ A-1 AAA 89.17% A-2 AAA 47.60% B AAA 44.80% F A+ 18.34% G A 13.08% H A- 7.82% J BBB+ 5.72% L-CA BB+ N/A M-MC BB+ N/A X-1A AAA N/A X-1B AAA N/A X-2 AAA N/A X-3 AAA N/A X-4 AAA N/A X-5 AAA N/A N/A Not applicable. BELLACH'S LEATHER: Case Summary & 17 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Bellach's Leather For Living Inc. aka Bellach's Leather Furniture P.O. Box 1336 Belvedere, CA 94920 Bankruptcy Case No.: 08-10362 Chapter 11 Petition Date: March 3, 2008 Court: Northern District of California (Santa Rosa) Judge: Alan Jaroslovsky Debtor's Counsel: David N. Chandler, Esq. Law Offices of David N. Chandler 1747 4th Street Santa Rosa, CA 95404 Tel: (707) 528-4331 DChandler1747@yahoo.com Total Assets: $1,596,000 Total Debts: $4,006,624 Debtor's list of its 17 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Palliser Furniture Corp. $190,803 P.O. Box 277165 Atlanta, GA 30384-7165 American Leather $143,310 4501 Mountain Creek Pkwy. Dallas, TX 75236 Elite Leather Co. $100,548 P.O. Box 30898 Los Angeles, CA 90030-0898 Sofa Art Ltd. $72,560 Calia America LLC $71,914 American Upholstery $13,163 Natuzzi Americas Inc. $58,045 AT&T $46,398 KRON - TV $45,721 Sacramento Bee/Steven Cribb advertising $37,126 San Franciso Chronicle $35,100 Five Star Plaza O6 A, LLC $32,000 Gamma Arredamenti Int'l Spa $19,494 KMAX-TV/Steven Cribb, Atty advertising $17,433 Hubbel & Associates $16,216 Marquis Collection Inc. $11,827 KFOG - FM $10,705 San Jose Mercury News $8,817 Storis Management Systems $13,284 W. Schillig USA $9,351 BERRY PLASTICS: B. Scheu Takes Helm at Rigid Closed Top Division ---------------------------------------------------------------- Berry Plastics Corp. announced on March 3, 2008 an organizational change involving one of its operating segments. Ben Scheu has accepted the role of president of Rigid Closed Top Division. Randy Hobson, who formerly served as president of Rigid Closed Top Division, has assumed the corporate role of executive vice president for Commercial Development. The company did not provide any additional information. About Berry Plastics Headquartered in Evansville, Nebraska, Berry Plastics Corporation -- http://www.berryplastics.com/ -- is a manufacturer and supplier of a diverse mix of rigid plastics packaging products focusing on the open top container, closure, aerosol overcap, drink cup and housewares markets. The company sells a broad product line to over 12,000 customers. Berry Plastics concentrates on manufacturing high quality, value-added products sold to marketers of institutional and consumer products. In 2004, the company created its international division as a separate operating and reporting division to increase sales and improve service to international customers utilizing existing resources. The international segment includes the company's foreign facilities and business from domestic facilities that is shipped or billed to foreign locations. * * * As reported in the Troubled Company Reporter on Feb. 14, 2008, Moody's Investors Service affirmed the B3 Corporate Family Rating of Berry Plastics Corporation and downgraded certain instrument ratings. The outlook is stable. BGF INDUSTRIES: Inks $75 Mil. Loan Agreement with Various Lenders ----------------------------------------------------------------- BGF Industries Inc. entered into a Loan Agreement on Feb. 26, 2008 with various lenders and NATIXIS, acting through its New York office, as administrative agent for itself and on behalf of the Lenders. The Loan Agreement provides for a credit facility of $75.0 million consisting of a $25.0 million revolving credit facility, a $27.5 million term A loan and a $22.5 million term B loan. Proceeds from the Loan Agreement will be used to provide for the working capital needs of the company and to redeem the company's 10 1/4% Senior Subordinated Notes due 2009 on March 27, 2008. No indebtedness is currently outstanding under the Facility. On the Agreement Date, the company issued a redemption notice to the Bank of New York Mellon, as trustee, with respect to the company's election to redeem all outstanding Notes on March 27, 2008. The credit facility is guaranteed by BGF Services Inc., NVH Inc. and Glass Holdings LLC. Additionally, all amounts outstanding under the credit facility and the guarantees thereof are secured by a first lien on substantially all of the assets of the company and the Guarantors. The Loan Agreement contains customary representations and warranties and various affirmative and negative covenants such as limitations on the incurrence of additional debt; limitations on the incurrence of liens; restrictions on investments and acquisitions; restrictions on the sale of assets; restrictions on the payment of dividends or make other distributions; and restrictions on the repurchase or redemption of stock. The Loan Agreement also includes customary events of default, including but not limited to: nonpayment of principal, interest or other fees or amounts; incorrectness of representations and warranties in any material respect; violations of covenants; bankruptcy; material judgment; ERISA events; invalidity of provisions of or liens created under guarantees or security documents; and change of control. A full-text copy of the Loan Agreement is available for free at: http://researcharchives.com/t/s?28bc About BGF Industries Headquartered in Greensboro, North Carolina, BGF Industries Inc., a wholly owned subsidiary of NVH Inc. -- http://www.bgf.com/-- focuses on the production of value-added specialty woven fabrics, non-woven fabrics and parts made from glass, carbon, and aramid yarns. The company's products are a critical component in the production of a variety of electronic, filtration, composite, insulation, protective, construction and commercial products. The company's glass fiber fabrics are used in printed circuit boards, which are integral to virtually all advanced electronic products, including computers and cellular telephones. The company's products are also used to strengthen, insulate and enhance the dimensional stability of hundreds of products that they make for their own customers in various markets, including aerospace, transportation, construction, power generation and oil refining. * * * BGF Industries Inc. still carries Moody's Investors Service's "Caa2" corporate family rating assigned on Nov. 24, 2004. Outlook is Negative. BNC MORTGAGE: Fitch Downgrades Ratings on $1.5B Certificates ------------------------------------------------------------ Fitch Ratings has taken rating actions on BNC mortgage pass- through certificates. Unless stated otherwise, any bonds that were previously placed on Rating Watch Negative are removed. Affirmations total $400.1 million and downgrades total $1.5 billion. Additionally, $469.6 million was placed on Rating Watch Negative. Break Loss percentages and Loss Coverage Ratios for each class are included with the rating actions as: BNC Mortgage Loan Trust, series 2007-1 -- $366.2 million class A1 downgraded to 'BBB' from 'AAA', remains on Rating Watch Negative (BL: 37.76, LCR: 1.24); -- $149.7 million class A2 affirmed at 'AAA', (BL: 70.74, LCR: 2.32); -- $35.3 million class A3 affirmed at 'AAA', (BL: 62.19, LCR: 2.04); -- $73.9 million class A4 downgraded to 'A' from 'AAA', remains on Rating Watch Negative (BL: 44.50, LCR: 1.46); -- $29.6 million class A5 downgraded to 'BBB' from 'AAA', remains on Rating Watch Negative (BL: 37.84, LCR: 1.24); -- $44.9 million class M1 downgraded to 'B' from 'AA+' (BL: 32.47, LCR: 1.07); -- $44.9 million class M2 downgraded to 'CCC' from 'AA' (BL: 27.09, LCR: 0.89); -- $14.7 million class M3 downgraded to 'CCC' from 'AA-' (BL: 25.30, LCR: 0.83); -- $17.1 million class M4 downgraded to 'CCC' from 'A+' (BL: 23.16, LCR: 0.76); -- $16.6 million class M5 downgraded to 'CC' from 'A' (BL: 20.98, LCR: 0.69); -- $9.8 million class M6 downgraded to 'CC' from 'A-' (BL: 19.58, LCR: 0.64); -- $9.3 million class M7 downgraded to 'CC' from 'BBB+' (BL: 18.03, LCR: 0.59); -- $8.3 million class M8 downgraded to 'CC' from 'BBB' (BL: 16.70, LCR: 0.55); -- $9.3 million class M9 downgraded to 'CC' from 'BBB-' (BL: 15.36, LCR: 0.50); -- $12.2 million class B1 downgraded to 'C' from 'BB+' (BL: 13.43, LCR: 0.44); -- $10.7 million class B2 downgraded to 'C' from 'BB' (BL: 12.04, LCR: 0.40). Deal Summary -- Originators: BNC (100%) -- 60+ day Delinquency: 14.38% -- Realized Losses to date (% of Original Balance): 0.27% -- Expected Remaining Losses (% of Current balance): 30.43% -- Cumulative Expected Losses (% of Original Balance): 27.26% BNC Mortgage Loan Trust, series 2007-2 -- $379.5 million class A1 downgraded to 'A' from 'AAA' (BL: 38.50, LCR: 1.53); -- $215.1 million class A2 affirmed at 'AAA', (BL: 64.27, LCR: 2.56); -- $100.9 million class A3 downgraded to 'AA' from 'AAA' (BL: 44.06, LCR: 1.76); -- $30.8 million class A4 downgraded to 'A' from 'AAA' (BL: 38.46, LCR: 1.53); -- $42.2 million class A5 downgraded to 'A' from 'AAA' (BL: 38.51, LCR: 1.53); -- $50.8 million class M1 downgraded to 'BB' from 'AA+' (BL: 33.47, LCR: 1.33); -- $50.8 million class M2 downgraded to 'B' from 'AA' (BL: 28.35, LCR: 1.13); -- $17.9 million class M3 downgraded to 'B' from 'AA-' (BL: 26.49, LCR: 1.06); -- $21.8 million class M4 downgraded to 'B' from 'A+' (BL: 24.11, LCR: 0.96); -- $17.9 million class M5 downgraded to 'CCC' from 'A' (BL: 22.07, LCR: 0.88); -- $12.3 million class M6 downgraded to 'CCC' from 'A-' (BL: 20.52, LCR: 0.82); -- $11.7 million class M7 downgraded to 'CCC' from 'BBB+' (BL: 18.92, LCR: 0.75); -- $9.5 million class M8 downgraded to 'CC' from 'BBB+' (BL: 17.69, LCR: 0.70); -- $13.4 million class M9 downgraded to 'CC' from 'BBB' (BL: 15.99, LCR: 0.64); -- $17.3 million class B1 downgraded to 'CC' from 'BB+' (BL: 13.83, LCR: 0.55); -- $15.1 million class B2 downgraded to 'C' from 'BB' (BL: 12.25, LCR: 0.49). Deal Summary -- Originators: BNC (100%) -- 60+ day Delinquency: 10.72% -- Realized Losses to date (% of Original Balance): 0.03% -- Expected Remaining Losses (% of Current balance): 25.09% -- Cumulative Expected Losses (% of Original Balance): 23.29% The rating actions are based on changes that Fitch has made to its subprime loss forecasting assumptions. The updated assumptions better capture the deteriorating performance of pools from 2007, 2006 and late 2005 with regard to continued poor loan performance and home price weakness. BUILDERS TRANSPORT: Judge Massey Confirms Joint Liquidation Plan ---------------------------------------------------------------- The Honorable James Massey of United States Bankruptcy Court for the Northern District of Georgia confirmed the Joint Consolidated Chapter 11 Plan of Liquidation dated Nov. 15, 2007, proposed by Builders Transport Inc. and its debtor-affiliates, and the Official Committee of Unsecured Creditors of the Debtors. Overview of the Plan The Plan contemplates the liquidation of substantially all of the Debtors' assets. T. Michael Guthrie has been named disbursing agent under the Plan. He is to liquidate the Debtors' remaining assets, if any, by the effective date of the Plan and distribute the cash and proceeds of those assets to creditors under the terms of the Plan. Mr. Guthrie charges $100 per hour for his services, according to Bloomberg News. As of the effective date of the Plan, the Debtors' estate will be substantively consolidated, such that: a) all intercompany claims are canceled and disallowed and no distributions will be made on account thereof; b) all guarantees of any of the Debtors for the payment, performance, or collection of obligations of the other Debtors are eliminated and canceled, and any claims on account of such guaranties are disallowed; c) any obligation of the Debtors and all guarantees thereof executed by the other Debtors are treated as a single obligation and are deemed a single claim against the consolidated estates; d) all joint obligations of the Debtors, and all multiple claims against such entities on account of such joint obligations, are deemed a single claim against the consolidated estates, and any such multiple claims are disallowed; and e) each claim filed in the bankruptcy cases is deemed filed against the consolidated estates. The Debtors and the Committee expect the Plan to take into effect by March 10, 2008. Treatment of Claims Under the Plan, Administrative Expense Claims, including Professional Fees and Reclamation Claims will be paid in full the amount of the allowed claim, without interest. Priority Tax Claims and Priority Non-Tax Claims will also be paid in full for the amount of the allowed claim, but without interest. Allowed General Unsecured Claims and Bondholders' Claims will be entitled to receive a pro rata share of remaining cash distributions, if any. The estimated pro rata payout is approximately 6/10 of $.01 for every $1.00 of the allowed claim amount. According to the Plan, that amount is based on the Debtors' schedules and claims filed and allowed. A full-text copy of the Joint Consolidated Chapter 11 Plan of Liquidation is available for free at: http://ResearchArchives.com/t/s?28cb A full-text copy of the Disclosure Statement is available for free at: http://ResearchArchives.com/t/s?28cc Headquartered in Columbia, South Carolina, Builders Transport Inc. engages in the truckload carrier industry and transport a wide range of commodities in both intrastate and interstate commerce. The company and six of its affiliates filed for Chapter 11 protection on May 21, 1998 (Bankr. N.D. Ga. Lead Case No 98-68798). Donald L. Rickertsen, Esq., at Holland & Knight, LLP, represents the Debtors in their restructuring efforts. The Debtors selected BMC Group Inc. as their claims and balloting agent. An Official Committee of Unsecured Creditors has been appointed in these cases. Aldo L. LaFiandra, Esq., at Alston & Bird LLP, represents the Committee. When the Debtors filed for protection against their creditors, it listed total assets of $209,329,000 and total liabilities of $235,786,000. CATHOLIC CHURCH: Fairbanks Wants Quarles & Brady as Counsel ----------------------------------------------------------- On behalf of the Catholic Bishop of Northern Alaska, Donald J. Kettler, sole director of the CBNA and bishop of the Diocese of Fairbanks, seeks permission from the United States Bankruptcy Court for the District of Alaska to employ Quarles & Brady LLP as the Diocese's general reorganization and restructuring counsel. Bishop Kettler says Quarles & Brady has extensive experience in representing distressed Catholic dioceses throughout the country, and in negotiating settlements of sexual abuse tort claims, and out-of-court and bankruptcy court supervised restructurings. Susan G. Boswell, Esq., and her team at Quarles & Brady also represented the Diocese of Tucson and The Roman Catholic Bishop of San Diego in their reorganization cases. As lead counsel for Fairbanks, Quarles & Brady will help the Diocese to: (a) negotiate and refine a plan of reorganization, which will be filed soon; (b) select and coordinate experts' efforts that may be employed to ascertain the values of the Diocese's assets, and other analyses; (c) evaluate real and personal property issues, including lien validity and perfection; (d) evaluate and advice on the unique aspects of the bankruptcy case and the laws governing the activities and business of a Roman Catholic diocese; (e) evaluate and prosecute claims that the Diocese should assert; and (f) properly administer the Diocese's assets and estate. Quarles & Brady will be paid based on the firm's standard hourly rates: Susan G. Boswell Senior Attorney $480 Kasey Nye Associate Attorney $300 Lori Winkelman Associate Attorney $300 Jane Friedman Legal Assistant $150 Quarles & Brady will also be reimbursed for reasonable expenses incurred with respect to their services for the bankruptcy case. The Diocese has paid Quarles & Brady a retainer of $160,000, which was in a segregated trust account for prepetition fees and costs. As of the bankruptcy filing, the outstanding amount of the Retainer was $4,176. Ms. Boswell, Esq., a partner at Quarles & Brady, assures Judge MacDonald that the partners, counsel or associates of Quarles & Brady are not creditors or insiders of the Diocese, and that the firm is a "disinterested person" as defined in Section 101(14) of the Bankruptcy Code. About Diocese of Fairbanks The Roman Catholic Diocese of Fairbanks in Alaska, aka Catholic Bishop of Northern Alaska, aka Catholic Diocese of Fairbanks, aka The Diocese of Fairbanks, aka CBNA filed for chapter 11 bankruptcy on March 1, 2008 (Bankr. D. Alaska Case No. 08-00110). Susan G. Boswell, Esq., at Quarles & Brady LLP represents the Debtor in its restructuring efforts. Judge Donald MacDonald IV of the United States Bankruptcy Court for the District of Alaska presides over Fairbanks' Chapter 11 case. When the Debtor filed for bankruptcy, it listed assets between $10 million and $50 million and debts between $1 million and $10 million. (Catholic Church Bankruptcy News, Issue No. 116; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). CATHOLIC CHURCH: Portland Needs No Special Master, Erin Olson Says ------------------------------------------------------------------ Erin K. Olson, Esq., at the Law Office of Erin Olson, P.C., in Portland, Oregon, tells the U.S. Bankruptcy Court for the District of Oregon that the Archdiocese of Portland in Oregon filed a request that largely ignores the procedure to which it stipulated in 2005. She notes that the protective order, which shields the documents of those who have been accused of abusing minors, allows the removal of protection of the Documents unless the Archdiocese asks, and the Court rules, not to release the Documents. The Archdiocese, instead, seeks an entirely new procedure, Ms. Olson relates. If the Court is not inclined to adopt the Archdiocese's proposed new procedure, Ms. Olson asks the Court to consider the Archdiocese's alternative requests. She points out that the request to preserve the status quo of the Protective Order with respect to the Documents, is the only alternative request that actually complies with the terms of the Protective Order. The appointment of a special master is not allowed under Rule 9031 of the Federal Rules of Bankruptcy Procedure, Ms. Olson asserts. There is no basis or authority for having a district court judge decide an issue arising under terms of the Protective Order issued in a core bankruptcy proceeding, she continues. Ms. Olson says that the Archdiocese's real goal is apparent from a clause buried in its request to appoint a special master -- it wants to prevent the Documents' disclosure, and to ensure that there is no possibility of future disclosure. Accordingly, Ms. Olson asks the Court to deny the Archdiocese's request, which seeks relief from the terms of the Protective Order. She also asks Judge Perris to set a briefing schedule, and set an evidentiary hearing, at which parties-in-interest can make their bests cases for releasing the Documents or maintaining their confidentiality. Portland Case Reopened As reported in the Troubled Company Reporter on Feb. 29, 2008, the Hon. Elizabeth L. Perris reopened the bankruptcy case of the Archdiocese of Portland in Oregon for further administration. Ms. Olson previously asked the Court to reopen the case to resolve certain issues, including her request to unseal, and file in redacted form, the documents and accompanying exhibits filed as Docket Nos. 4765 and 4766 in the bankruptcy case. Fathers Joseph Bacelleri, Donald Durand, Maurice Grammond, Gary Jacobson, Rocco Perrone, Michael W. Sprauer, Ronald Warren, and Chester Wrzaszczak objected to the reopening of the case. They complained that the case has been completed, claims have been settled and closed, and that the matter should be at an end. Alternatively, the priests asked the Court to refer the disclosure issues to mediators, Judge Velure and Judge Hogan, for mediation and arbitration, as has been previously agreed upon by the Archdiocese and certain of the claimants' counsel. About Archdiocese of Portland The Archdiocese of Portland in Oregon filed for chapter 11 protection (Bankr. Ore. Case No. 04-37154) on July 6, 2004. Thomas W. Stilley, Esq., and William N. Stiles, Esq., at Sussman Shank LLP, represent the Portland Archdiocese in its restructuring efforts. Albert N. Kennedy, Esq., at Tonkon Torp, LLP, represents the Official Tort Claimants Committee in Portland, and scores of abuse victims are represented by other lawyers. David A. Foraker serves as the Future Claimants Representative appointed in the Archdiocese of Portland's Chapter 11 case. In its Schedules of Assets and Liabilities filed with the Court on July 30, 2004, the Portland Archdiocese reports $19,251,558 in assets and $373,015,566 in liabilities. The Court approved the Debtor's disclosure statement explaining its Second Amended Joint Plan of Reorganization on Feb. 27, 2007. On April 17, 2007, the Court confirmed Portland's 3rd Amended Plan. On Sept. 28, 2007, the Court entered a final decree closing Portland's case. The case was subsequently reopened at Ms. Olson's request of further case administration. (Catholic Church Bankruptcy News, Issue No. 116; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). CDC MORTGAGE: Eroding Credit Support Cues S&P's Rating Downgrades ----------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on six classes of mortgage pass-through certificates from CDC Mortgage Capital Trust 2003-HE2. The lowered ratings reflect the deterioration of available credit support for this transaction in combination with projected credit support percentages--based on the amount of loans in the delinquency pipeline-that are insufficient to maintain the ratings at their previous levels. Based on the current collateral performance of this transaction, S&P projects future credit enhancement will be significantly lower than the original credit support for the previous ratings. The failure of excess interest to cover monthly losses has resulted in the complete erosion of overcollateralization (O/C) for this transaction. This O/C deficiency caused principal write- downs to both class B-3 and B-2, which prompted us to downgrade them to 'D'. As of the Feb. 25, 2008, remittance date, cumulative losses for this transaction were 1.94% of the original pool balance. Total delinquencies and severe delinquencies (90-plus days, foreclosures, and REOs) were 33.53% and 24.86% of the current pool balance, respectively. A combination of subordination, excess interest, and O/C (prior to its complete erosion) provide credit enhancement for this transaction. The collateral supporting this series consists of a subprime pool of fixed- and adjustable-rate mortgage loans secured by first liens on one- to four-family residential properties. Ratings Lowered CDC Mortgage Capital Trust 2003-HE2 Mortgage pass-through certificates Rating ------ Class To From ----- -- ---- M-1 AA AA+ M-2 BB A M-3 CCC BBB B-1 CCC BB B-2 D B B-3 D CCC CELL THERAPEUTICS: Issues $51 Mil. of 9% Convertible Senior Notes ----------------------------------------------------------------- Cell Therapeutics Inc. will issue approximately $51.7 million of new 9% Convertible Senior Notes due 2012 and warrants to purchase 7,326,950 shares of common stock, no par value. The warrants will have an exercise price of $1.41 per share, which is equal to 110% of the closing bid price as reported by Nasdaq. The Notes bear interest at 9% per annum and are convertible at any time for shares of CTI common stock at the rate of 709.22 shares per $1,000 principal amount of Notes, which is equivalent to an initial conversion price of approximately $1.41 per share, which is equal to 110% of the closing bid price as reported by Nasdaq. The Notes feature a make-whole provision upon conversion entitling the holder to $270 per $1,000 principal amount of Notes, less any interest paid before conversion. An amount equal to the make- whole payment amount for such notes, or $13.9 million, shall be held in escrow for one year. The Notes will rank equal in right of payment with all existing and future senior indebtedness of CTI, including the company's 6.75% Convertible Senior Notes due 2010, 7.5% Convertible Senior Notes due 2011, 5.75% Convertible Senior Notes due 2011, and rank senior in right of payment to the company's outstanding 5.75% Senior Subordinated Notes due 2008, 5.75% Subordinated Notes due 2008 and 4% Convertible Senior Subordinated Notes due 2010. CTI also disclosed that a substantial number of existing holders of the company's Series A 3% Convertible Preferred Stock, Series B 3% Convertible Preferred Stock, Series C 3% Convertible Preferred Stock and Series D 7% Convertible Preferred Stock have converted their shares of Preferred Stock into common stock in accordance with the respective provisions of the company's Amended and Restated Articles of Incorporation, induced by an aggregate cash payment by CTI to such holders of approximately $16.2 million. Approximately $13.1 million of stated value of Preferred Stock remains outstanding. Rodman & Renshaw, LLC, a subsidiary of Rodman & Renshaw Capital Group Inc. acted as the exclusive placement agent for the offering. A prospectus supplement relating to the Convertible Notes to be issued in the offering may be obtained directly from Cell Therapeutics Inc., 501 Elliott Avenue West, Suite 400, Seattle, Washington. About Cell Therapeutics Inc. Based in Seattle, Cell Therapeutics Inc. (NasdaqGM: CTIC) -- http://cticseattle.com/-- is a biopharmaceutical company committed to developing an integrated portfolio of oncology products aimed at making cancer more treatable. At Sept. 30, 2007, the company's balance sheet showed total assets of $84.95 million and total liabilities of $204.29 million, resulting to a total shareholders' deficit of $119.34 million. CHARYS HOLDING: Taps Richards Layton as Bankruptcy Co-Counsel ------------------------------------------------------------- Charys Holding Company Inc. and Crochet & Borel Services Inc. ask the United States Bankrupty Court for the District of Delaware for authority to employ Richards, Layton & Finger P.A. as their bankruptcy co-counsle, nunc pro tunc to Feb. 14, 2008. As the Debtors' co-counsel, RL&F will: a) advise the Debtors of their rights, powers and duties as debtors and debtors in possession; b) take all necessary action to protect and preserve the Debtors' estates, including the prosecution of actions on the Debtors' behalf, the defense of any actions in which the Debtors are involved, and the preparation of objections to claims filed against the Debtors' estates; c) prepare on behalf of the Debtors all necessary motions, applications, answers, orders, reports and papers in connection with the administration of the Debtors' estates; and d) perform all other necessary legal services in connection with the Chapter 11 cases. Mark D. Collins, Esq., a director of RL&F, assures the Court that the firm does not hold any interest adverse to the Debtors or their estates, and that the firm is a "disinterested person" as such term is defined under Sec. 101(14) of the Bankruptcy Code. Prior to bankruptcy filing, the Debtors paid RL&F a total retainer of $75,000 in connection with the Debtors' Chapter 11 filing. A portion of this payment has been applied to outstanding balances as of the petition date. As compensation for their services, RL&F's professionals bill: Professional Hourly Rate ------------ ----------- Mark D. Collins Esq. $560 Paul N. Heath, Esq. $400 Chun I. Jang, Esq. $260 Barbara J. Witters $175 Mr. Collins can be reached at: Mark D. Collins, Esq. Richards, Layton & Finger P.A. One Rodney Square 920 North King Street Wilmington, DE 19801 Tel: (302) 651-7531 Fax: (302) 498-7531 email: Collins@rlf.com About Charys Holding Headquartered in Atlanta, Georgia, Charys Holding Co., Inc., -- http://www.charys.com/-- provide remediation & reconstruction and wireless communications & data infrastructure. The company and its Crochet & Borel Services, Inc. subsidiary filed for Chapter 11 protection on Feb. 14, 2008 (Bankr. Del. Case No.08-10289). Chun I. Jang, Esq., Mark D. Collins, Esq., and Paul Noble Heath, Esq., at Richards, Layton & Finger, P.A., represent the Debtors in their restructuring efforts. No Official Committee of Unsecured Creditors has been appointed in these cases to date. When the Debtors filed for protection against their creditors, it listed total assets of $245,000,000 and total debts of $255,000,000. CHRYSLER LLC: Can Have Unlimited Access to Daimler AG's Technology ------------------------------------------------------------------ Daimler AG granted Chrysler LLC a no-frills access to its advanced technology, Mike Spector of The Wall Street Journal reports. Chrysler can use the technology in order to pursue and enhance fuel-economy and mileage on its products, says WSJ, citing Chrysler vice chairman Jim Press at a Geneva auto convention. Chrysler previously streamlined its production by rejecting the "car cloning" practice, and instead will focus on selling its remaining, unique car models. As reported in the Troubled Company Reporter on Feb. 27, 2008, the company's streamlining measures came after it lost its tooling battle with Plastech Engineered Products Inc. The U.S. Bankruptcy Court for the Eastern District of Michigan denied the company's request to pull out tooling equipment from Plastech's plants. About Chrysler LLC Based in Auburn Hills, Michigan, Chrysler LLC -- http://www.chrysler.com/-- a unit of Cerberus Capital Management LP, produces Chrysler, Jeep(R), Dodge and Mopar(R) brand vehicles and products. The company has dealers worldwide, including Canada, Mexico, U.S., Germany, France, U.K., Argentina, Brazil, Venezuela, China, Japan and Australia. * * * As reported in the Troubled Company Reporter on Nov. 12, 2007, Standard & Poor's Ratings Services affirmed its 'B' corporate credit rating on Chrysler LLC and DaimlerChrysler Financial Services Americas LLC and removed it from CreditWatch with positive implications, where it was placed Sept. 26, 2007. S&P said the outlook is negative. CLAYTON STINE: Voluntary Chapter 11 Case Summary ------------------------------------------------ Debtor: Clayton M. Stine 10143 Gravel Hill Road Bangor, PA 18013 Bankruptcy Case No.: 08-20435 Chapter 11 Petition Date: March 3, 2008 Court: Eastern District of Pennsylvania (Reading) Debtor's Counsel: David F. Dunn, Esq. David Dunn Law Offices PC 21 South 9th Street Allentown, PA 18102 Tel: (610) 439-1500 dunncourtpapers@choiceonemail.com Estimated Assets: $500,001 to $1 million Estimated Debts: $1,000,001 to $10 million The Debtor did not file its list of largest unsecured creditors. CLEAR CHANNEL: Trial on Sale Funding Dispute Set for April 7 ------------------------------------------------------------ The Hon. Leo Strine of the Chancery Court of Delaware will hold an April 7, 2008 a hearing to determine if Wachovia Corp. should be compelled to extend financing to Providence Equity Partners Inc. for the purchase of Clear Channel Communications Inc.'s television stations, The Wall Street Journal and Reuters relate. As reported in the Troubled Company Reporter on Feb. 19, 2008, Clear Channel filed a lawsuit on Feb. 15, 2008, against Providence Equity to compel the private equity firm to complete its acquisition of Clear Channel's Television Group. The TV Group has 56 television stations, including 18 digital multicast stations, located in 24 markets across the United States. Providence disclosed in November 2007 that it had reservations about the transaction, which it entered with Clear Channel in April 2007. $1.3 Billion Sale Approved by FCC As reported in the TCR on Dec. 5, 2007, Clear Channel received approval from the Federal Communications Commission to sell 35 television stations to Newport Television LLC, a private equity firm controlled by Providence, for $1.3 billion. In its order, the FCC denied a petition filed by Buckley Broadcasting of Monterey, seeking reconsideration of the 2002 Commission decision granting applications to transfer control of the Ackerley Group Inc. to Clear Channel. However, the FCC approval comes with certain conditions that must be met by Newport in six months, including divesting TV stations in nine markets where it is in violation with FCC ownership rules. Companies must comply with the numerical ownership limits of the FCC local television ownership rule. The nine market areas are Bakersfield, San Francisco, Santa Barbara, Fresno and Monterey in California; Salt Lake City; Albany, New York; Jacksonville, Florida, and San Antonio, Texas. Clear Channel then cut its selling price to $1.1 billion. Wachovia Wants to Get Out Wachovia Corp.'s lawsuit filed on Feb. 22, 2008, with the North Carolina Superior Court could thwart a sale deal between Clear Channel and Providence. Wachovia filed for a declaratory judgment to liberate itself from funding the sale after the parties amended the terms of the transaction, dropping the price to $1.1 billion. Wachovia, which agreed in April to finance $500 million of the deal, contends that the revision of the original transaction terms nullified its financing commitment, the TCR said on Feb. 27, 2008. Newport Strikes Back Providence previously said it may try to renegotiate the purchase price, and should the deal fails, a $45 million break-up fee would have to be paid. Newport then filed a countersuit against Wachovia in a Delaware Court, demanding payment of break-up fee plus costs unless Wachovia extends the needed fund. Providence demanded that the lenders be held to the terms of the deal it had rejected. About Clear Channel 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 Jan. 30, 2008, Standard & Poor's Ratings Services said its ratings on Clear Channel Communications, including the 'B+' corporate credit rating, remain on CreditWatch with negative implications. S&P originally placed them on CreditWatch on Oct. 26, 2006, following the company's announcement that it was exploring strategic alternatives to enhance shareholder value. COLLEZIONE EUROPA: Blames Sales Drop to Customers Rhodes, Levitz ---------------------------------------------------------------- The bankruptcies of two of Collezione Europa USA, Inc.'s biggest retail customers contributed to the sharp fall in sales of the company in the past three years, the company revealed in court filings, according to Larry Thomas and Jay McIntosh of Furniture Today. The company said its sales declined from about $120 million in 2004 to $74 million in 2007 partly due to the failures of Atlanta- based Rhodes Furniture and New York-based Levitz Furniture Inc. It took a $3 million credit loss when it lost Levitz as customer in November. Collezione said it had a net loss of about $7 million last year and that its lender has declared it in default of a covenant on its revolving credit loan. Collezione has asked for permission to pay wages, bills and other expenses to continue to operate the business. A hearing on the motions is set for Wednesday. "In addition to the loss of the customer and repeat business, Collezione was forced to take delivery of canceled purchase orders and store those goods in its warehouse," said Paul Frankel, vice president of Collezione Europa, in a declaration to the bankruptcy court. The company said it needs time to reduce inventory and overhead expenses to return to profitability. The company's bankruptcy petition showed that it owes $3,743,709 to B&L Industries, Inc. of Fort Lauderdale, Fla. Collezione's two affiliated companies, Kelly Road Warehouse, LLC, and 145 Cedar Lane Associates, LLC, also filed for bankruptcy. Rhodes, Inc. and two of its debtor-affiliates filed for chapter 11 protection on Nov. 4, 2004. Levitz Furniture Inc., nka PVLTZ Inc. is a specialty retailer of furniture, bedding and home furnishings in the United States. Levitz Furniture Inc. and 11 affiliates filed for chapter 11 on Sept. 5, 1997. In December 2000, the Court confirmed the Debtors' Plan and Levitz emerged from chapter 11 on February 2001. Levitz Home Furnishings Inc. was created as the new holding company as a result of the emergence. Levitz Home Furnishings and 12 affiliates filed for chapter 11 protection on Oct. 11, 2005. PLVTZ, dba Levitz Furniture, continued to face decline in financial performance since December 2005. Liquidity issues and the inability to obtain additional capital prompted PLVTZ to seek protection under chapter 11 on Nov. 8, 2007. About Collezione Europa USA, Inc Based in Englewood, N.J., Collezione Europa USA, Inc. -- http://www.czeusa.com/-- was founded in 1984. Since the inception of the company, the sole focus has been imports from different parts of the world . The Company presently imports from the Philippines, China, Taiwan and Mexico. Collezione Europa maintains an inventory of more than 250,000 items. The Company operates a 450,000 square foot warehouse in Claremont, North Carolina. In July 2005 Collezione established a new showroom at the Las Vegas World Market Center, Las Vegas. The Company also has a showroom in High Point, North Carolina. The company and two of its subsidiaries filed for bankruptcy protection on Feb. 29, 2008 (Bankr. D.N.J., Case No. 08-13599). Sam Della Fera, Esq. at Trenk, DiPasquale, Webster, Della Fera & Sodono represents the Debtors in their restructuring efforts. When the company filed for bankruptcy petition, it listed assets of $10 million to $50 million and debts of $10 million to $50 million. COMPTON PETROLEUM: Board Checks Review Plans, Strategic Options --------------------------------------------------------------- Compton Petroleum Corporation's board of directors has determined to conduct a formal review of the company's business plans and strategic alternatives for enhancing shareholder value, in recognition of certain matters raised by Centennial Energy Partners LLC, a significant shareholder of Compton. This will include, among other things, exploring potential asset divestments, equity alternatives, strategic alliances, joint venture opportunities, mergers, or a corporate transaction. The board has appointed a special committee of its independent directors to conduct the review. The special committee is comprised of Mel F. Belich, chairman of the board, and J. Stephens Allan, Irvine J. Koop, John W. Preston, Jeffrey T. Smith and John A. Thomson. The board has also appointed Tristone Capital Inc. and UBS Securities Canada Inc. as independent financial advisors to assist the company in the conduct of this review. With the natural gas prices and the potential inherent in Compton's natural gas resource plays, the company's plans to realize on this potential are expected to deliver shareholder value. The special committee is undertaking the review to determine whether other alternatives might result in superior value for shareholders. The company cautions shareholders that there is no assurance that the review will result in any specific transaction and no timetable has been set for its completion. The company also disclosed that Mr. Peter Seldin, managing member of Centennial Energy Partners LLC, has been appointed to the board and the special committee. About Compton Petroleum Based in Calgary, Alberta, Compton Petroleum Corporation (TSX: CMT)(NYSE:CMZ) -- http://www.comptonpetroleum.com/-- is engaged in the exploration, development, and production of natural gas, natural gas liquids, and crude oil in the Western Canada Sedimentary Basin. The company is a wholly-owed subsidiary of Compton Petroleum Acquisition Limited. * * * Petroleum Corporation continues to carry Moody's Investors Service's 'B1' corporate family rating and 'B2' senior unsecured note rating, which was placed in July 2007. CONSECO INC: Extends Annual Report Filing Deadline to March 17 -------------------------------------------------------------- Conseco Inc. extended the due date of its Annual Report on Form 10-K to March 17, 2008. In a Form 12b-25 filing, the company said it has not yet finalized its Dec. 31, 2007, financial statements and is completing several items, including its analysis to determine the possible need to increase the deferred income tax asset valuation allowance. Conseco estimated that its net income or loss for the three months ended Dec. 31, 2007, will be approximately breakeven, including estimated net realized investment losses, after related amortization and taxes, of $25 million, but before any adjustments which may result from finalizing the incomplete items. The company also reported that it has been consulting with the staff of the Securities and Exchange Commission's Office of the Chief Accountant regarding its accounting policy for long-term care premium rate increases as described in the Summary of Significant Accounting Policies in its 2006 Form 10-K. On Feb. 28, 2008, the SEC Staff informed Conseco of their view that the use of a method which prospectively changes reserve assumptions for long-term care policies based solely on changes in premium rates is not consistent with the guidance of Statement of Financial Accounting Standards No. 60, "Accounting and Reporting by Insurance Enterprises." The company is evaluating the SEC Staff's view and has reflected the estimated effect in the estimated net income or loss. As a result of these developments, the company will report results for the fourth quarter of 2007 before the market opens on Monday, March 17. About Conseco Inc. Headquartered in Carmel, Indiana, Conseco Inc. (NYSE: CNO) -- http://www.conseco.com/-- is the holding company for a group of insurance companies operating throughout the United States that develop, market and administer supplemental health insurance, annuity, individual life insurance and other insurance products. The company became the successor to Conseco Inc. (Old Conseco), in connection with its bankruptcy reorganization. CNO focuses on serving the senior and middle-income markets. The company sells its products through three distribution channels: career agents, professional independent producers and direct marketing. CNO operates through its segments, which includes Bankers Life, Conseco Insurance Group, Colonial Penn, other business in run-off and corporate operations. * * * As reported in the Troubled Company Reporter on Dec. 28, 2007, Fitch Ratings downgraded the Issuer Default Rating, senior debt, preferred stock, and insurer financial strength ratings of Conseco Inc. and its subsidiaries. The preferred stock rating is being withdrawn as there are no current outstanding issues and no plans for issuance. The rating action affects approximately $1.2 billion in outstanding debt. The outlook remains negative. COUDERT BROTHERS: Dechert Wants to Dip Hands Into Escrowed Fund --------------------------------------------------------------- Dechert LLP asks the U.S. Bankruptcy Court for the Southern District of New York to draw amounts from an escrow account under an employee transition agreement with Coudert Brothers LLP. Prior to the date of bankruptcy, Dechert, the Debtor, and its non- debtor affiliate Coudert Freres, were parties to certain agreements relating to the withdrawal and transition of Coudert's lawyers to Dechert. Pursuant to the agreement, Dechert's Paris office agreed to assume all obligations of Coudert accruing after October 2005 with respect to remuneration and benefits of the Coudert Paris's employees, and agreed to be solely responsible for any costs and expenses in connection with the termination of any such employees. Under the transition agreement, the Debtor was obligated, prior to the date of bankruptcy, to fund $500,000 into an interest-bearing escrow account held by Dechert, with the funds used to cover "restructuring costs" and with accrued interest expressly inuring to Dechert's benefit. The Debtor funded $382,631 of this obligation, which funds have been and are held by Dechert in a segregated escrow account. The severance obligations that Dechert incurred significantly exceeded the amount presently contained in the escrow account, and Dechert timely provided notice to the Debtor of such shortfall, as well as a subsequent request to counsel to the Debtor for an agreement to permit application of the amounts held in the escrow account to the obligations incurred by Dechert. Dechert continues to hold the escrow account currently containing $406,523, which includes $23,891 in accrued interest. Accordingly, pursuant to Sections 362(d) and 553 of the U.S. Bankruptcy Code, Dechert seeks authority from the Court to effectuate a setoff of the funds held in the escrow account against amounts due under the agreements. Dechert argues that -- because it has a valid right of setoff under the Bankruptcy Code and applicable New York law -- cause therefore exists for relief from the automatic stay. The Court should allow Dechert to release the funds currently held in the escrow account so that they can be applied to cover the "restructuring costs," as provided for in the agreements, Dechert says. About Coudert Brothers Coudert Brothers LLP was an international law firm specializing in complex cross border transactions and dispute resolution. The firm had operations in Australia and China. The Debtor filed for Chapter 11 protection on Sept. 22, 2006 (Bankr. S.D.N.Y. Case No. 06-12226). John E. Jureller, Jr., Esq., and Tracy L. Klestadt, Esq., at Klestadt & Winters LLP, represent the Debtor in its restructuring efforts. Kurtzman Carson Consultants LLC serves as the Debtor's claims and noticing agent. Brian F. Moore, Esq., and David J. Adler, Esq., at McCarter & English LLP, represent the Official Committee Of Unsecured Creditors. In its schedules of assets and debts, Coudert listed total assets of $29,968,033 and total debts of $18,261,380. COVANTA HOLDING: Earns $72 Million in Quarter Ended December 31 --------------------------------------------------------------- Covanta Holding Corporation reported financial results for the three and twelve months ended Dec. 31, 2007. For the three months ended Dec. 31, 2007, net income was $72 million, up from $12 million in the prior year comparative period. This increase was impacted by lower interest expense, resulting from the recapitalization completed in early 2007, and a lower effective tax rate, driven by the release of a valuation allowance. Cash flow provided by operating activities was $98 million in the fourth quarter. For the twelve months ended Dec. 31, 2007, net income grew 23% to $131 million, up from $106 million in 2006. This increase was impacted by lower interest expense and a lower effective tax rate. Operating cash flow was $358 million for the year. The company incurred $86 million of capital expenditures in 2007, which included $18 million related to the SEMASS fire, $12 million of capital improvements at facilities acquired during the year, and $55 million primarily to maintain existing facilities. In addition, the company repaid $164 million of project debt and invested $110 million in acquisitions and $11 million in equity interests. In total, the company reinvested all of its operating cash flow back into the business. Liquidity and Capital Resources As of Dec. 31, 2007, the company has available credit for liquidity of $268.8 million under the revolving loan facility and unrestricted cash of $149.4 million. The company was in compliance, As of Dec. 31, 2007, with the covenants under the credit facilities. At Dec. 31, 2007, the company's balance sheet total assets of $4.36 billion, total liabilities of $3.34 billion and total shareholders' equity of $1.02 billion. "2007 was a milestone year for Covanta, as we made significant progress towards our strategic goals," Anthony Orlando, president and chief executive officer of Covanta. "We recapitalized our balance sheet to provide the financial flexibility to seize growth opportunities, successfully integrated several acquisitions to complement our domestic fleet, and we established platforms to expand our energy-from-waste business in Europe and China. In addition, we extended our track record of consistent operational performance, safely converting 15 million tons of waste into clean, renewable energy for our clients, while again generating strong financial results within or above our guidance ranges." About Covanta Holding Corp. Headquartered in Fairfield, New Jersey, Covanta Holding Corp. -- http://www.covantaenergy.com/-- is a publicly traded holding company whose subsidiaries develop, own or operate power generation facilities and water and wastewater facilities in the United States and abroad. Covanta has operations in the Philippines, China, Costa Rica, India, and Bangladesh. * * * Covanta Holding Corp. continues to carry Standard & Poor's Ratings Services' 'BB-' long term foreign and local issuer credit ratings, which were place in January 2007. COVENANT CHRISTIAN: Case Summary & 19 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: Covenant Christian Ministries, Inc. P.O. Box 4065 Marietta, GA 30061 Bankruptcy Case No.: 08-64095 Type of Business: The Debtor is a religious organization. Chapter 11 Petition Date: March 3, 2008 Court: Northern District of Georgia (Atlanta) Judge: James Massey Debtor's Counsel: Leon S. Jones, Esq. Jones & Walden, LLC 21 Eighth Street, Northeast Atlanta, GA 30309 Tel: (404) 564-9300 Fax: (404) 564-9301 E-mail: ljones@joneswalden.com Estimated Assets: $1 million to $ 10 million Estimated Debts: $1 million to $ 10 million Debtor's list of its 19 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Internal Revenue Service Government Agency $98,454 P.O. Box 21126 941 Taxes owed Philadelphia, PA 19114-0326 Jenkins & Olson, P.C. Legal fees $96,765 15 South Public Square Cartesville, GA 30120 Georgia Department of Revenue Government Agency $66,659 Taxpayer Services Division State Employee P.O. Box 105499 taxes owed Atlanta, GA 30348-5499 Kaiser Permanente &nb