T R O U B L E D C O M P A N Y R E P O R T E R Wednesday, May 7, 2008, Vol. 12, No. 108 Headlines AMERICAN HOME: Deadline for Assumed Contract Claims Set for May 7 AMPEX CORP: Wants Court to Deny Committee Access to Information ARVINMERITOR INC: Spins Off Light Vehicle Biz to Shareholders ARVINMERITOR: Light Vehicle's Spinoff Cues Fitch's Negative Watch ARVINMERITOR INC: S&P Holds 'B+' Rating on Light Vehicle Spinoff AVENSYS CORP: Posts $419,824 Net Loss in 2nd Quarter Ended Dec. 31 BCAP LLC: Moody's Cuts 60 Tranches' Ratings From Six Alt-A Deals BGF INDUSTRIES: Sept. 30 Balance Sheet Upside-Down by $28.5 MM BIRCH MOUNTAIN: Amex Sends Notice of Noncompliance on Deficiencies BLAST ENERGY: March 31 Balance Sheet Upside-Down by $3,006,117 BLOUNT INC: S&P's 'BB- Rating Unaffected by Carlton Acquisition BLUE WATER: Shortens Plan Schedule to Meet Customers' Deadline BLUE WATER: Hearing on Case Conversion Set for May 12 BON-TON STORES: Earns $11.6 Million in Fiscal Year Ended Feb. 2 BROOKLYN PSYCHIATRIC: Case Summary & 16 Largest Unsec. Creditors CASH SYSTEMS: Has Until July 31 to Comply with Nasdaq Criteria CEDAR MANAGEMENT: Files For Chapter 11 Protection in California CHARMING SHOPPES: Moody's Withdraws Ratings for Business Reasons CHURCH & DWIGHT: Buys Del Pharma Biz from Coty Inc. at $380 Mil. CHURCH & DWIGHT: Moody's Keeps 'Ba1' Ratings on Del Pharma Deal CHURCH & DWIGHT: Stable Performance Cues S&P to Lift Rating to BB+ CITIGROUP MORTGAGE: Moody's Downgrades Ratings on 45 Tranches CLEBURNE & TM: Voluntary Chapter 11 Case Summary COMPASS MINERALS: Planned Note Redemption Cues S&P's Pos. Watch COUNTRYWIDE FINANCIAL: Fitch Puts All Ratings Under Evolving Watch DELPHI CORP: Plastech Can Return Tooling to Delphi Automotive DELPHI CORP: Court Extends Exclusive Plan-Filing Period to Aug. 31 DELPHI CORP: GM's Charges on Delphi Issues Reach $8.3 Billion DIAMOND GLASS: Can Hire Getzler Henrich as Financial Advisor DIAMOND GLASS: Court Okays NatCity as Investment Banker DR HORTON: Posts $1 Billion Net Loss in Quarter Ended March 31 DURA AUTOMOTIVE: Court Approves Merger with Automotive Aviation DURA AUTOMOTIVE: Wants to Expand Assessment Tech's Scope of Work EDUCATION MANAGEMENT: $22.5MM Add'l Facility Cues S&P to Hold Rtng EOS AIRLINES: Wants to Employ Squire Sanders as Bankruptcy Counsel EVIVA COFFEE: Case Summary & 20 Largest Unsecured Creditors FIRST MARBLEHEAD: To Trim Down Operating Cost in Student Loan Unit FGIC CORP: Negotiates with Potential Investors on Revamp Proposals FORD MOTOR: CAW Union Members Ratify New Labor Agreement FRENCH LICK: Completed Exchange Cues Moody's Rating Lift to 'Caa3' GENERAL MOTORS: Charges on Delphi Corp. Issues Reach $8.3 Billion GENERAL MOTORS: Plastech Inks MOU with GM for Exit Financing GMAC LLC: Home Mortgage Unit Unable to Pay Debts Due June 2008 HEALTH NET: Moody's Reviews 'Ba2' Rating After First Qtr. Results HILEX POLY: Files for Chapter 11 Protection in Delaware HILEX POLY: Case Summary & 20 Largest Unsecured Creditors HOMBANC CORP: Files Joint Chapter 11 Plan of Liquidation HOMEBANC CORP: Classification and Treatment of Claims Under Plan JO-ANN STORES: Moody's Changes Outlook to Positive; Holds Ratings JONES APPAREL: Moody's Reviews 'Ba1' Rating for Possible Cuts JPMORGAN CHASE: S&P Affirms Ratings on 13 Certificate Classes KG LEGACY: Voluntary Chapter 11 Case Summary KIMBALL HILL: Section 341 Meeting of Creditors Slated for June 19 KIMBALL HILL: U.S. Trustee Appoints Seven-Member Creditors Panel KIMBALL HILL: Wants to Hire Kirkland & Ellis as Bankr. Counsel LEHMAN MORTGAGE: Higher Delinquencies Cues Moody's 28 Rating Cuts LINENS N THINGS: Gets Limited Access to Lenders' Cash Collateral LINENS N THINGS: Noteholders Threaten to Challenge DIP Facility LEXINGTON PRECISION: Seven Members Appointed to Creditors' Panel LEXINGTON PRECISION: Court Okays Weil Gotshal as Bankr. Counsel MARATHON HEALTHCARE: Wants to Hire Rogin Nassau as Counsel MASONITE INT'L: Moody's Cuts Debt Ratings on Revenue Contraction MCJUNKIN RED: S&P Assigns 'B+' Corporate Credit Rating MEDIANEWS GROUP: Weak Sales Cues Moody's Corp. Rating Cut to 'B3' MONITOR OIL: Global Maritime & Adshead Sued for Contract Breach MUTUAL SAVINGS: AM Best Lifts Rtng. to B+(Good) From C++(Marginal) NEWFIELD EXPLORATION: Fitch Holds Ratings on $425MM Notes Issuance NEWFIELD EXPLORATION: Moody's Puts 'Ba3' Rating on $600 Mil. Notes NUTRITIONAL SOURCING: Supermercados Buys Assets For $29.5 Million NUTRITIONAL SOURCING: Has Until July 2 to File Chapter 11 Plan NVIDIA CORP: Court Rejects Trustee's Claim for $100 Million OXFORD INDUSTRIES: Moody's Reviews Ratings for Possible Downgrade PACE UNIVERSITY: Moody's Keeps 'Ba1' Ratings on MBIA Insured Bonds PANAVISION INC: Weakening Liquidity Prompts Moody's Rating Reviews PITG GAMING: Moody's Ratings Unmoved by Change on Facility's Terms PITG GAMING: S&P Lifts Ratings After Changes on Proposed Structure PLASTECH ENGINEERED: To Close Shreveport Manufacturing Plant PLASTECH ENGINEERED: Can Return Tooling to Delphi Automotive POLYPORE INT'L: Moody's Lifts Ratings to 'B2' on Reduced Leverage PRC LLC: Files Amended Chapter 11 Plan and Disclosure Statement PRC LLC: Discloses Various Analysis Under Chapter 11 Plan PRC LLC: Verizon and Affiliates Balk at Disclosure Statement PREMAIR INC: Section 341(a) Meeting Slated for Friday PREMAIR INC: Wants to Hire William Tucker as General Counsel R&G FINANCIAL: Fitch Drops Ratings to 'CC' & Ceases Coverage REEDEN CAPITAL: Case Summary & 19 Largest Unsecured Creditors RESIDENTIAL CAPITAL: Unable to Pay Debts Due June 2008 ROCKVILLE CDO: Poor Credit Quality Cues Moody's Rating Downgrades SEE WHY GERARD: Didn't Dispute Court Decision to Dismiss Case SOLAR COSMETICS: Files Chapter 11 Petition; Gets $1.9 Mil. Loan SOLAR COSMETIC: Case Summary & 20 Largest Unsecured Creditors SPRINT NEXTEL: Considers Sale or Spin Off of Nextel Business SPRINT NEXTEL: Nears $12 Billion Joint Venture with Clearwire SUNCREST LLC: Trustee Appoints Seven-Members to Creditors Panel SUNCREST LLC: Committee Panel Wants Plan-Filing Periods Ended TBW MORTGAGE: Moody's Cuts Ratings on 36 Tranches on Delinquencies TLB EQUIPMENT: Case Summary & Four Largest Unsecured Creditors UAL CORP: Lenders Approve Amendment to $1.5BB Credit Facility VALLEJO CITY: Must File for Bankruptcy, City Manager Advises VILLAGE HOTEL: Ritz-Carlton Opposes Conversion or Dismissal Plea WHITING PETROLEUM: $365MM Uinta Deal Won't Affect S&P's BB- Rating WIRELESS PARTNERS: Case Summary & 19 Largest Unsecured Creditors * Fitch Says Health of Vehicle Market Is A Good Indicator of Loss * S&P Says LOC-Backed Debt Became Increasingly Popular in 2007 * Five Bankruptcy Attorneys Join Morrison & Foerster in New York * Reed Smith Names A. Sussman as Corporate & Securities Partner * Upcoming Meetings, Conferences and Seminars ********* AMERICAN HOME: Deadline for Assumed Contract Claims Set for May 7 ----------------------------------------------------------------- The closing of the sale of the mortgage loan servicing business of American Home Mortgage Investment Corp. and its debtor-affiliates to Wilbur L. Ross' AH Mortgage Acquisition Co., Inc., was consummated on April 11, 2008. Pursuant to the parties' Asset Purchase Agreement and the sale order of the U.S. Bankruptcy Court for the District of Delaware, the Debtors assumed and assigned or transferred certain unexpired leases, license agreements and executory contracts to AHM Acquisition. Consequently, the Debtors notified all parties-in-interest that the deadline for filing any claim by a counterparty to an Assumed Contract is on May 7, 2008. As reported by the Troubled Company Reporter on May 5, AH Mortgage Acquisition informed Judge Christopher Sontchi that the closing of the sale of the mortgage loan servicing business of the Debtors has occurred. The Court approved the sale of the mortgage loan servicing business to AHM Acquisition for about $500,000,000, pursuant to an Asset Purchase Agreement, under a two-stage closing process. The Initial Closing occurred on Nov. 16, 2007. Under the APA, the Debtors operated the Servicing Business for the economic benefit and risk of AHM Acquisition pending the final closing. To fund the servicing operations in the interim, the Debtors entered into a $50,000,000 Debtor-in-Possession Loan and Security Agreement, which was later amended to increase the financing commitment to $100,000,000. About American Home Based in Melville, New York, American Home Mortgage Investment Corp. (NYSE: AHM) -- http://www.americanhm.com/-- is a mortgage real estate investment trust engaged in the business of investing in mortgage-backed securities and mortgage loans resulting from the securitization of residential mortgage loans originated and serviced by its subsidiaries. American Home Mortgage and seven affiliates filed for chapter 11 protection on Aug. 6, 2007 (Bankr. D. Del. Case Nos. 07-11047 through 07-11054). James L. Patton, Jr., Esq., Joel A. Waite, Esq., and Pauline K. Morgan, Esq. at Young, Conaway, Stargatt & Taylor LLP represent the Debtors. Epiq Bankruptcy Solutions LLC acts as the Debtors' claims and noticing agent. The Official Committee of Unsecured Creditors selected Hahn & Hessen LLP as its counsel. As of March 31, 2007, American Home Mortgage's balance sheet showed total assets of $20,553,935,000, total liabilities of $19,330,191,000. The U.S. Bankruptcy Court for the District of Delaware extended the exclusive periods for American Home Mortgage Investors Corp. and its debtor-affiliates to file a plan of reorganization through June 2, 2008; and solicit and obtain acceptances for that plan through July 31, 2008. (American Home Bankruptcy News, Issue No. 35; Bankruptcy Creditors' Service, Inc., Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). AMPEX CORP: Wants Court to Deny Committee Access to Information --------------------------------------------------------------- Ampex Corporation and its debtor-affiliates ask the Hon. Arthur J. Gonzalez of the U.S. Bankruptcy Court for the Southern District of New York to prohibit the Official Committee of Unsecured Creditors from accessing confidential and other non-public proprietary information of the Debtors. Rachel C. Strickland, Esq., at Willkie Farr & Gallagher LLP in New York, say the distribution of confidential information -- including compensation levels and other employee information -- to the Committee could have serious harm to the Debtors' estates. The public disclosure of this information may cause other problems for the Debtors, Ms. Strickland adds. A hearing is set for May 20, 2008, at 10:00 a.m., to consider approval of the Debtors' request. The hearing will took place at Courtroom 523, One Bowling Green in New York. Objections, if any, are due May 16, 2008, at 4:00 p.m. About Ampex Headquartered in Redwood City, California, Ampex Corp. -- http://www.ampex.com/-- (Nasdaq:AMPX) is a licensor of visual information technology. The company has two business segments: Recorders segment and Licensing segment. The Recorders segment primarily includes the sale and service of data acquisition and instrumentation recorders (which record data and images rather than computer information), and to a lesser extent mass data storage products. The Licensing segment involves the licensing of intellectual property to manufacturers of consumer digital video products through their corporate licensing division. On March 30, 2008, Ampex Corp. and six affiliates filed for protection under Chapter 11 of the Bankruptcy Code with the U.S. Bankruptcy Court for the Southern District of New York (Case Nos. 08-11094 through 08-11100). Matthew Allen Feldman, Esq., and Rachel C. Strickland, Esq., at Willkie Farr & Gallagher LLP, represents the Debtors in their restructuring efforts. The Debtors have also retained Conway Mackenzie & Dunleavy as their financial advisors. In its schedules of assets and liabilities filed with the Court, Ampex Corp. disclosed total assets of $9,770,089 and total debts of $82,488,054. The Debtors have nine foreign affiliates that are incorporated in seven countries -- one each in the United Kingdom, Japan, Belgium, Colombia and Brazil and two each in Germany and Mexico. With the exception of the affiliates located in the U.K. and Japan, none of the other foreign affiliates conduct meaningful business activity. As of March 30, 2008, none of the foreign affiliates have commenced insolvency proceedings. ARVINMERITOR INC: Spins Off Light Vehicle Biz to Shareholders ------------------------------------------------------------- The board of directors of ArvinMeritor, Inc. approved a plan to spin off its Light Vehicle Systems business to ArvinMeritor shareholders, with the Commercial Vehicle Systems business remaining with ArvinMeritor. "The plan to separate our two businesses is the result of a comprehensive strategic review to enhance the company's long-term value for our shareholders," Chip McClure, chairman, CEO and president, said. "We are confident that this transaction will not only unlock shareholder value, but will also significantly strengthen the competitive positions of both companies and better align them with their respective customer bases. "Each company will benefit from a greater strategic focus on its core business and growth opportunities as well as from increased recognition in each of its global market segments. In addition, the separate companies will offer more attractive and targeted investment opportunities, with incentives for management and employees that are more closely aligned with company performance and shareholder interests," Mr. McClure continued. The planned spinoff of the LVS business -- to be named Arvin Innovation, Inc. -- would be implemented through a pro rata tax- free dividend to ArvinMeritor shareholders. Upon completion of the spinoff, ArvinMeritor shareholders will own 100% of the common stock of Arvin Innovation. Approval of the spinoff by ArvinMeritor shareholders is not required, and the company expects to complete the spinoff within the next 12 months, contingent upon satisfactory financial and automotive market conditions as well as other customary approvals. "Our decision to spin off the LVS business is part of the company's ongoing corporate transformation -- our 3R strategy to rationalize, refocus and regenerate -- that has been underway for the last three years," Mr. McClure said. "Separating these two businesses and successfully implementing our Performance Plus initiatives are major steps in the transformation to build two stronger, more competitive companies for the future. "Our LVS business group will have the right leadership team, a solid financial structure, market-leading positions in many of its product lines, a well-diversified customer mix and the global reach to grow this new company as a market leader going forward," Mr. McClure concluded. Mr. McClure will remain as ArvinMeritor's chairman, CEO and president. James Marley, currently a board member of ArvinMeritor, will lead Arvin Innovation's board of directors as non-executive chairman. Until the spin is completed, Marley, a retired chairman of the board of AMP Inc., will remain on the ArvinMeritor board. Phil Martens, currently ArvinMeritor's senior vice president and president, Light Vehicle Systems, will become the president and CEO of Arvin Innovation. "As a separate independent unit, Arvin Innovation will be better positioned to drive specific growth initiatives, including improving our customer focus and expanding our global presence," Mr. Martens said. "With increased flexibility as a stand-alone business, Arvin Innovation will have an excellent opportunity to create next-generation systems technology solutions for our customers around the world. In addition, we look forward to the many new and enhanced opportunities the new organization will provide for our worldwide employees." Jim Donlon, executive vice president and CFO of ArvinMeritor will immediately begin supporting ArvinMeritor's LVS business group in the capacity of chief financial officer as it prepares to become an independent company. Upon completion of the spin, he will become executive vice president and CFO of Arvin Innovation. Jay Craig, senior vice president and controller, will replace Donlon as ArvinMeritor's senior vice president and CFO, effective immediately. Rakesh Sachdev, senior vice president of ArvinMeritor and president of Asia Pacific, will become executive vice president, chief administrative officer and managing director of Emerging Markets of the new company, upon the completion of the spin. However, until a successor is named, he will continue to be responsible for ArvinMeritor's Asia Pacific region. When the spinoff is completed, Carsten Reinhardt, senior vice president of ArvinMeritor and president of the company's Commercial Vehicle Systems business, will be named COO for ArvinMeritor. In addition, Mary Lehmann, currently the company's senior vice president, Strategic Initiatives, and Treasurer, will expand her responsibilities to include Information Services, M&A activities, and Investor Relations. Vernon Baker, currently senior vice president and general counsel, with overall legal responsibility for all of ArvinMeritor's global operations and its subsidiaries, and Environmental, Health and Safety, will also assume responsibility for the global Human Resources organization. ArvinMeritor will remain headquartered in Troy, Michigan. Arvin Innovation will be headquartered in Detroit, Michigan, at the current location of the LVS Detroit Technology Center, with other corporate offices located in Europe, Asia Pacific and South America. The spinoff is subject to customary conditions, including final approval by ArvinMeritor's board of directors; completion of all required activities with employee representatives; receipt of applicable consents; effectiveness of a registration statement with the Securities and Exchange Commission; receipt of a tax ruling from the IRS; and the approval of applicable regulatory authorities. ArvinMeritor's common stock will continue to trade on the New York Stock Exchange under the symbol ARM. Management has applied for Arvin Innovation to be listed on the NASDAQ global stock market under the symbol ARVI. Until the spinoff is effective, ArvinMeritor's management intends to recommend that its board continue its current dividend policy. J.P. Morgan Securities Inc. is ArvinMeritor's lead financial advisor for this transaction. UBS Securities is also advising ArvinMeritor on financial matters relating to the transaction. Chadbourne & Parke LLP as well as Miller, Canfield, Paddock and Stone, P.L.C. are acting as ArvinMeritor's legal advisors. Light Vehicle Systems ArvinMeritor's LVS business is a global provider of dynamic motion and control automotive systems and components, with sales of $2.2 billion in 2007 -- $2.0 billion of value-added sales and $200 million of pass-through sales. Of the value-added sales, more than 60% were outside North America. ArvinMeritor's LVS business group is a market leader in many of the product categories it serves, supplying components and integrated systems and modules to the world's leading passenger car and light truck OEMs. The business will have approximately 9,000 employees with 42 facilities in 16 countries. LVS has interests in eight joint ventures (three consolidated and five non-consolidated). About ArvinMeritor Headquartered in Troy, Michigan, ArvinMeritor, Inc. (NYSE: ARM) -- http://www.arvinmeritor.com/-- supplies a broad range of integrated systems, modules and components to the motor vehicle industry. The company serves commercial truck, trailer and specialty original equipment manufacturers and certain aftermarkets, and light vehicle manufacturers. ArvinMeritor employs approximately 19,000 people in 24 countries. ARVINMERITOR: Light Vehicle's Spinoff Cues Fitch's Negative Watch ----------------------------------------------------------------- Fitch has placed the ratings of ArvinMeritor on Rating Watch Negative following the announced spinoff of ArvinMeritor's Light Vehicle Systems group. As information becomes available Fitch will review the details of each entity and resolve the Rating Watch designation. The spinoff will reduce the business diversification of the current consolidated entity, increasing exposure of the remaining Commercial Vehicle Systems business to the cyclical truck market, and increasing exposure of the LVS entity to competitive conditions and individual manufacturers in the automotive market. The benefits of recent restructuring actions have begun to be reflected in financial results, although margins at LVS currently remain at low levels and have been challenging to stabilize. Duplicating corporate functions at the LVS entity concurrent with the spin will also pressure margins. Total liquidity requirements will likely increase from current levels in order to finance working capital requirements, continuing restructuring actions, capital expenditures, and to act as a buffer against cyclical volatility. The combined entity has forecast continued negative cash flow for its current fiscal year, indicating that total debt to be allocated at the time of the spin will be higher than current levels. Existing senior unsecured debt could be pushed farther down the capital structure or face reduced recovery prospects depending on the allocation of debt and new financing arrangements. Fitch has placed these ratings for ARM on Rating Watch Negative: -- Issuer Default Rating 'B'; -- Senior Unsecured 'B/RR4' -- Bank Credit Facility 'BB/RR1'. ARVINMERITOR INC: S&P Holds 'B+' Rating on Light Vehicle Spinoff ---------------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'B+' corporate credit rating and other ratings on ArvinMeritor Inc. The outlook remains negative. "The affirmations follow ArvinMeritor's announcement of its plan to spin off its light vehicle systems business to ArvinMeritor shareholders," said Standard & Poor's credit analyst Lawrence Orlowski. Management expects that the transaction, which is not subject to shareholder approval, will be completed within 12 months. After the spin-off, ARM's primary focus will be trucks and other commercial vehicles. The company supplies drivetrain systems, which include axles and drivelines, braking systems, suspension systems, and ride control products. S&P would continue to characterize the business risk profile as weak. S&P are concerned about how profitability and cash flow will unfold before the legal separation, given uncertainty about production among many automotive and heavy-truck customers. Still, S&P expect the company's financial profile to strengthen in time because of its adequate liquidity. S&P could lower the rating if the downturn in the company's commercial vehicle systems business is much more severe or longer than expected, perhaps because of unexpected economic weakness and worsening negative free cash flow. S&P could revise the outlook to stable if the company seems capable of generating positive cash flow as a result of better operating efficiencies and some end-market improvements. AVENSYS CORP: Posts $419,824 Net Loss in 2nd Quarter Ended Dec. 31 ------------------------------------------------------------------ Avensys Corp. reported a net loss of $419,824 on revenue of $4.3 million for the second quarter ended Dec. 31, 2007, compared with a net loss of $1.5 million on revenue of $4.9 million in the same period ended Dec. 31, 2006. Sales from the Avensys Tech and Avensys Environmental Solutions divisions of Avensys Inc., for the three and six month periods ended Dec. 31, 2007, account for 94.7% and 95.7%, respectively, of the company's net revenues. Revenues for the three month period ended Dec. 31, 2007, decreased by 11.5% over the same period in 2006. Excluding C-Chip non- royalty revenues included in the comparative period, revenues for the three month period ended Dec. 31, 2007, increased by 36.6% and 36.0%, respectively, over the same period in 2006. Gross margin increased to $1.5 million during the three month period ended Dec. 31, 2007, versus gross margin of $918,201 during the same period ended Dec. 31, 2006, mainly as a result of improved margins at Avensys Tech and the new C-Chip business model. Loss from operations decreased to $1.0 million from loss from operations $1.1 million during the three months ended Dec. 31, 2006, mainly due to the increase in gross margin, partly offset by the incredase in total operating expenses. Depreciation and amortization expenses for the three month period ended Dec. 31, 2007, increased by $65,301 over the same period in 2006. Selling, general and administrative expenses for the three month period ended Dec. 31, 2007, increased by $113,682 compared to the same period in 2006. Research and development expenses for the three month period ended Dec. 31, 2007, increased by $331,994 compared with the same period in 2006. The increase is primarily attributable to the expanded roster of research and development projects at ITF Labs. Refundable tax credits for the three month period ended Dec. 31, 2007, increased to $425,422 compared to $164,501 during the same period in 2006. Balance Sheet At Dec. 31, 2007, the company's consolidated balance sheet showed $19.6 million in total assets, $11.2 million in total liabilities, $25,232 in non-controlling interest, and $8.4 million in total stockholders' equity. Full-text copies of the company's consolidated financial statements for the quarter ended Dec. 31, 2007, are available for free at http://researcharchives.com/t/s?2b7d Going Concern Doubt As reported in the Troubled Company Reporter on Oct. 4, 2007, Montreal, Canada-based Raymond Chabot Grant Thornton LLP expressed substantial doubt about Manaris Corp. nka. Avensys Corp.'s ability to continue as a going concern after auditing the company's consolidated financial statements for the year ended June 30, 2007. The auditor pointed to the company's significant losses since inception and reliance on non-operational sources of financing to fund operations. During the three month period ended Dec. 31, 2007, the company used $339,808 of cash to fund operating activities from continuing operations. In comparison, during the three month period ended Dec. 31, 2006, the company used $81,321 of cash to fund operating activities from continuing operations. About Avensys Corp. Headquartered in Montreal, Canada, Avensys Corp. fka. Manaris Corp. (OTC BB: AVNY.OB) -- http://www.avensyscorporation.com/-- operates Avensys Inc., its wholly-owned core subsidiary. Avensys Inc., through its manufacturing division Avensys Technologies, designs, manufactures, distributes, and markets high reliability optical components and modules as well as FBGs for the telecom market and high power devices and sub-assemblies for the industrial market. Avensys Technologies also develops packaged fiber-based sensors. Avensys Environmental Solutions, also a division of Avensys Inc., provides environmental monitoring solutions for air, water and soil in the Canadian marketplace. BCAP LLC: Moody's Cuts 60 Tranches' Ratings From Six Alt-A Deals ---------------------------------------------------------------- Moody's Investors Service downgraded the ratings of 60 tranches from 6 Alt-A transactions issued by BCAP LLC Trust. Thirty tranches remain on review for possible further downgrade. Additionally, 6 tranches were placed on review for possible downgrade. The collateral backing these transactions consists primarily of first-lien, fixed and adjustable-rate, Alt-A mortgage loans. The ratings were downgraded, in general, based on higher than anticipated rates of delinquency, foreclosure, and REO in the underlying collateral relative to credit enhancement levels. The actions are a result of Moody's on-going review process. Complete rating actions are: Issuer: BCAP LLC Trust 2006-AA1 -- Cl. A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. M-1, Downgraded to B3 from Aa1 -- Cl. M-2, Downgraded to B3 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. M-3, Downgraded to B3 from Aa3; Placed Under Review for further Possible Downgrade -- Cl. M-4, Downgraded to B3 from Baa2; Placed Under Review for further Possible Downgrade -- Cl. M-5, Downgraded to Caa1 from Baa3; Placed Under Review for further Possible Downgrade -- Cl. M-6, Downgraded to Ca from Ba1 -- Cl. M-7, Downgraded to Ca from Ba3 -- Cl. M-8, Downgraded to Ca from B3 Issuer: BCAP LLC Trust 2006-AA2 -- Cl. A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. M-1, Downgraded to B2 from Aa1 -- Cl. M-2, Downgraded to B2 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. M-3, Downgraded to B3 from Aa3; Placed Under Review for further Possible Downgrade -- Cl. M-4, Downgraded to B3 from A3; Placed Under Review for further Possible Downgrade -- Cl. M-5, Downgraded to B3 from Baa2; Placed Under Review for further Possible Downgrade -- Cl. M-6, Downgraded to Caa1 from Baa3; Placed Under Review for further Possible Downgrade -- Cl. M-7, Downgraded to Ca from Ba3 -- Cl. M-8, Downgraded to Ca from B3 Issuer: BCAP LLC Trust 2007-AA1 -- Cl. I-A-4, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-M-1, Downgraded to Ba3 from Aa1 -- Cl. I-M-2, Downgraded to B1 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. I-M-3, Downgraded to B2 from Aa3; Placed Under Review for further Possible Downgrade -- Cl. I-M-4, Downgraded to B3 from Baa1; Placed Under Review for further Possible Downgrade -- Cl. I-M-5, Downgraded to B3 from Baa3; Placed Under Review for further Possible Downgrade -- Cl. I-M-6, Downgraded to Ca from Ba1 -- Cl. I-M-7, Downgraded to Ca from Ba3 -- Cl. II-M-1, Downgraded to Baa1 from Aa1 -- Cl. II-M-2, Downgraded to Ba3 from Aa2 -- Cl. II-M-3, Downgraded to B1 from Aa3 -- Cl. II-M-4, Downgraded to B1 from A2; Placed Under Review for further Possible Downgrade -- Cl. II-M-5, Downgraded to B2 from Baa2; Placed Under Review for further Possible Downgrade -- Cl. II-M-6, Downgraded to Ca from Ba2 -- Cl. II-M-7, Downgraded to Ca from B3 Issuer: BCAP LLC Trust 2007-AA2 -- Cl. I-1-A, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-2-A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-M-1, Downgraded to Baa2 from Aa1 -- Cl. I-M-2, Downgraded to B1 from Aa2 -- Cl. I-M-3, Downgraded to B1 from Aa3; Placed Under Review for further Possible Downgrade -- Cl. I-M-4, Downgraded to B2 from A3; Placed Under Review for further Possible Downgrade -- Cl. I-M-5, Downgraded to B3 from Baa2; Placed Under Review for further Possible Downgrade -- Cl. I-M-6, Downgraded to Ca from Ba1 -- Cl. I-M-7, Downgraded to Ca from Ba2 -- Cl. I-M-8, Downgraded to Ca from B3 -- Cl. II-M-1, Downgraded to Baa2 from Aa2 -- Cl. II-B-1, Downgraded to B1 from Baa2; Placed Under Review for further Possible Downgrade -- Cl. II-B-2, Downgraded to B3 from B1; Placed Under Review for further Possible Downgrade -- Cl. II-B-3, Downgraded to Ca from B3 Issuer: BCAP LLC Trust 2007-AA3 -- Cl. II-A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. II-M-1, Downgraded to Ba2 from Aa1 -- Cl. II-M-2, Downgraded to B1 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. II-M-3, Downgraded to B1 from Aa3; Placed Under Review for further Possible Downgrade -- Cl. II-M-4, Downgraded to B1 from A1; Placed Under Review for further Possible Downgrade -- Cl. II-M-5, Downgraded to B2 from A2; Placed Under Review for further Possible Downgrade -- Cl. II-M-6, Downgraded to B2 from A3; Placed Under Review for further Possible Downgrade -- Cl. II-M-7, Downgraded to B3 from Baa1; Placed Under Review for further Possible Downgrade -- Cl. II-M-8, Downgraded to B3 from Baa3; Placed Under Review for further Possible Downgrade -- Cl. II-M-9, Downgraded to Ca from Ba1 Issuer: BCAPB LLC Trust 2007-AB1 -- Cl. M-2, Downgraded to A1 from Aa2 -- Cl. M-3, Downgraded to A3 from Aa3 -- Cl. M-4, Downgraded to Baa2 from A1 -- Cl. M-5, Downgraded to Ba1 from A2 -- Cl. M-6, Downgraded to B1 from A3 -- Cl. M-7, Downgraded to B1 from Baa1; Placed Under Review for further Possible Downgrade -- Cl. M-8, Downgraded to B1 from Baa2; Placed Under Review for further Possible Downgrade -- Cl. M-9, Downgraded to B2 from Baa3; Placed Under Review for further Possible Downgrade BGF INDUSTRIES: Sept. 30 Balance Sheet Upside-Down by $28.5 MM -------------------------------------------------------------- BGF Industries Inc.'s balance sheet at Sept. 30, 2007, showed $85.4 million in total assets, and $113.9 million in total liabilities, resulting in a $28.5 million total stockholders' deficit. The company reported net income of $2.0 million for the third quarter ended Sept. 30, 2007, compared with a net loss of $2.5 million in the same period of 2006. Results for the third quarter ended Sept. 30, 2006, included other income of $1.8 million, or 4.1% of net sales, due to the settlement of a class action lawsuit. Net sales increased $4.1 million, or 9.5%, to $47.8 million in the three months ended Sept. 30, 2007, from $43.7 million in the three months ended Sept. 30, 2006, primarily due to the increase in sales of the company's filtration fabrics and protective fabrics. Selling, general and administrative expenses decreased $200,000 to $2.8 million in the three months ended Sept. 30, 2007, from the three months ended Sept. 30, 2006, due primarily to decreased management fees. Operating income increased $1.3 million to $4.9 million, or 10.3% of net sales, in the three months ended Sept. 30, 2007, from $3.6 million, or 8.2% of net sales, in the three months ended Sept. 30, 2006. Interest expense decreased $100,000 to $2.7 million, or 5.6% of net sales, in the three months ended Sept. 30, 2007, from $2.8 million, or 6.5% of net sales, in the three months ended Sept. 30, 2006. Liquidity and Capital Resources The company's primary sources of liquidity are cash flows from operations and borrowings under its financing arrangements. On June 6, 2003, the company entered into a five year financing arrangement with Wells Fargo Foothill Inc. The WFF loan is guaranteed by the company's parent, NVH Inc., BGF Services Inc. and Glass Holdings LLC. The WFF Loan, as amended, has a maximum revolver credit line of $21.0 million and a term loan of $6.0 million. As of Sept. 30, 2007, amounts outstanding under the WFF Loan totaled $4.8 million which consisted solely of $4.8 million under the term loan. Availability under the revolver at Sept. 30, 2007, and Oct. 29, 2007 was $19.6 million. This availability has been reduced by a reserve to allow for the annual interest payments on the Senior Subordinated Notes. Full-text copies of the company's financial statements for the third quarter ended Sept. 30, 2007, are available for free at: http://researcharchives.com/t/s?2b7f 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. BIRCH MOUNTAIN: Amex Sends Notice of Noncompliance on Deficiencies ------------------------------------------------------------------ Birch Mountain Resources Ltd. reports that on April 29, 2008, it received notice from the American Stock Exchange, Listing Qualifications Department, that the company is below certain of the Exchange's continued listing standards due to deficiencies in its financial condition and operating results under Sections 1003(a)(i), 1003(a)(ii), 1003(a)(iii) and 1003(a)(iv) of the Amex company Guide. To maintain its Amex listing, Birch Mountain will submit a plan to the Exchange by May 29, 2008, documenting the actions it has taken, and will take, to regain compliance with the continued listing standards by Oct. 29, 2009. If the plan is not acceptable to Amex, Birch Mountain will be subject to delisting procedures as set forth in Section 1010 and part 12 of the company Guide. If the plan is accepted but it is not in compliance with the continued listing standards at the conclusion of the plan period, or if the company does not make progress consistent with the plan during the plan period, the Amex Staff will initiate delisting proceedings as appropriate. About Birch Mountain Headquartered in Calgary, Canada, Birch Mountain Resources Limited (AMEX:BMD) -- http://www.birchmountain.com/-- is in the industrial minerals business producing and selling limestone aggregate products. The company's operations are located north of Fort McMurray, Alberta, where the company holds metallic and industrial mineral rights over a portion of the Athabasca region in the heart of Alberta's expanding oil sands industry. The company operates the Muskeg Valley Quarry, an early production stage limestone quarry that produces limestone aggregate products for sale to customers in the Athabasca oil sands region of north- eastern Alberta. The company is engaged in the regulatory approval process for the Hammerstone Project, which would expand the MVQ and add an integrated limestone processing complex to provide manufactured limestone-based products, such as quicklime, as well as related environmental services, such as spent lime recalcining. BLAST ENERGY: March 31 Balance Sheet Upside-Down by $3,006,117 -------------------------------------------------------------- Blast Energy Inc.'s consolidated balance sheet at March 31, 2008, showed $2,841,638 in total assets and $5,847,755 in total liabilities, resulting in a $3,006,117 total stockholders' deficit. At March 31, 2008, the company's consolidated balance sheet also showed strained liquidity with $1,760,142 in total current assets available to pay $2,502,755 in total current liabilities. The company reported a net loss of $666,284 for the first quarter ended March 31, 2008, compared with a net loss of $3,529,340 in the same period in 2007. Thes decrease in net loss is primarily related to the lower loss from discontinued operations arising from the sale of the company's contract drilling business during 2007 and lower administrative costs. Satellite Communication Services' revenues decreased to $71,652 for the quarter ended March 31, 2008, compared to $162,419 for the quarter ended March 31, 2007. The company attributed the decrease in revenues to the decline in new business and existing customer renewals during the time the company was in Chapter 11. There were no Down-hole Solutions' revenues for the quarters ended March 31, 2008, and March 31, 2007. Selling, general and administrative expenses decreased to $585,947 for the quarter ended March 31, 2008, compared to $1,879,082 for the quarter ended March 31, 2007. Cash Flows from Financing Activities Net cash provided by financing activities was $3,546,530 for the quarter ended March 31, 2008. Net cash provided by financing activities for the quarter ended March 31, 2008, included $4,000,000 from the issuance of convertible preferred stock and $100,000 of borrowings under the company's DIP loan facility offset by $552,570 of payments on short term debt. As reported in the Troubled Company Reporter on April 11, 2008, under the terms of the confirmed plan, Blast raised $4.0 million in cash proceeds from the sale of convertible preferred securities to Clyde Berg and McAfee Capital, two parties related to its largest shareholder, Berg McAfee Companies. The proceeds from the sale of the securities were used to pay 100% of the unsecured creditor claims, all administrative claims, and all statutory priority claims, for a total amount of approximately $2.4 million. The remaining approximately $1.6 million will be used to execute an operational plan, including but not limited to, reinvesting in the Satellite Services and Down-hole Solutions businesses and pursue an emerging Digital Oilfield Services business. Full-text copies of the company's consolidated financial statements for the quarter ended March 31, 2008, are available for free at http://researcharchives.com/t/s?2b80 About Blast Energy Headquartered in Houston, Blast Energy Services Inc. -- http://www.blastenergyservices.com/-- provides contract land drilling services to the energy industry in the United States and Africa. The company also provides satellite services to oil and gas producers, which enables them to monitor and control well head, pipeline, and drilling operations through broadband data and voice services from remote operations where conventional land- based communication networks do not exist. The company and its wholly owned subsidiary Eagle Domestic Drilling Operations LLC, filed for Chapter 11 protection on Jan. 19, 2007 (Bankr. S.D. Tex. Case No. 07-30424 and 07-30426). On Feb. 26, 2008, the Court entered an order confirming the company's Second Amended Plan of Reorganization. This ruling allows the Debtors to emerge from Chapter 11 bankruptcy, which became effective Feb. 27, 2008. BLOUNT INC: S&P's 'BB- Rating Unaffected by Carlton Acquisition --------------------------------------------------------------- Standard & Poor's Ratings Services said that its ratings and outlook on Blount Inc. (BB-/Negative/--) are not affected by the company's announcement that it acquired Carlton Holdings Inc., a saw chain manufacturer based in Oregon, for $63 million. The acquisition bolsters Blount's core Outdoor Products Group operations and further diversifies the company's sales internationally. Despite a weakening U.S. economy, the company continues to meet S&P's expectations, including funds flow to total debt of about 15% and total debt to EBITDA of about 4x. BLUE WATER: Shortens Plan Schedule to Meet Customers' Deadline -------------------------------------------------------------- Blue Water Automotive Systems, Inc. and its affiliated debtors ask the United States Bankruptcy Court Eastern District of Michigan to modify a prior scheduling order to set a disclosure statement hearing at which final approval may be obtained, rather than the preliminary approval process presently established in the Order. The Court has previously set these deadlines for the confirmation of a plan of reorganization and the approval of a disclosure statement explaining the plan: May 23, 2008 -- Deadline for parties to ask the Debtors to include any information in the Disclosure Statement June 11, 2008 -- Deadline for the Debtors to file a combined plan and disclosure statement July 29, 2008 -- Deadline to return ballots on the plan and file objections to final approval of the disclosure statement and responses to confirmation of the plan August 5, 2008 -- Hearing on Disclosure Statement objections and confirmation of the plan The Court also ordered for "preliminary" approval of a disclosure statement, instead of final approval, prior to the period during which the Debtors will be permitted to solicit acceptance or rejection of the plan. Specifically, the Order stated that the Court "will consider whether to grant preliminary approval of the disclosure statement," and that the Court will notify the Debtors' counsel if it determines not to grant preliminary approval of the disclosure statement. Pursuant to Section 1125(b) of the Bankruptcy Code and Rule 3017(a) of the Federal Rule of Bankruptcy Procedure, the Debtors are not permitted to solicit acceptance or rejection of a plan before the disclosure statement is approved by the Court, after notice and a hearing, John A. Simon, Esq., at Foley & Lardner, LLP, in Detroit, Michigan, states. However, pursuant to the Court's Order, the Debtors are required to solicit acceptance or rejection of the Plan without final approval of the disclosure statement. The Debtors ask the Court to set these new deadlines: May 7, 2008 - Deadline for Debtors to file a separate plan and disclosure statement May 21, 2008 - Deadline to file objections to final approval of the disclosure statement May 23, 2008 - Hearing on objections to final approval of the disclosure statement June 10, 2008 - Deadline to return ballots on the plan and file objections to confirmation of the plan June 13, 2008 - Final approval and confirmation of the plan Mr. Simon avers that these shortened timeframes are necessary because the Debtors must meet the deadlines in the Accommodation Agreements to prevent Ford Motor Company, General Motors Corporation and Chrysler LLC -- the Major Customers -- from resourcing and thus preserve their business and the highest value of their assets for a sale. The Financing Period under the Accommodation Agreements will expire no later than June 30, 2008. Mr. Simon relates that the Debtors have obtained 10 expressions of interest or non-binding letters of intent from parties interested in purchasing the Debtors' assets. He says the Debtors expect to have an Asset Purchase Agreement signed by May 28, 2008, and to close a sale of their assets in connection with confirmation of a chapter 11 plan by June 30, 2008, as required under the short time-frame mandated by the Accommodation Agreements. The Debtors also ask the Court to remove the deadline to file motions to value security because these motions will likely be based on the proceeds resulting from the Debtors' sale and thus will likely not be capable of being determined until after the sale. About Blue Water Automotive Blue Water Automotive Systems, Inc. designs and manufactures engineered thermoplastic components and assemblies for the automotive industry. The company's product categories include airflow management, full interior trim/sub-systems, functional plastic components, and value-added assemblies. They are supported by full-service design, program management, manufacturing and tooling capabilities. With more than 1,400 employees, Blue Water operates eight manufacturing and product development facilities and has annual revenues of approximately US$200 million. The company's headquarters and technology center is located in Marysville, Mich. The company has operation in Mexico. In 2005, KPS Special Situations Fund II, L.P., and KPS Special Situations Fund II(A), L.P., acquired Blue Water Automotive through a stock purchase transaction. In 2006, the company acquired the automotive assets and operations of Injectronics, Inc., a manufacturer of thermoplastic injection molded components and assemblies. KPS then set about reorganizing the company. The company implemented a program to improve operating performance and address its liquidity issues. During 2007, the company replaced senior management, closed two facilities, and reduced overhead spending by one third. Blue Water Automotive and four affiliates filed for chapter 11 bankruptcy protection Feb. 12, 2008, before the United States Bankruptcy Court Eastern District of Michigan (Detroit) (Case No. 08-43196). Judy O'Neill, Esq., and Frank DiCastri, Esq., at Foley & Lardner, LLP, serves as the Debtors' bankruptcy counsel. Administar Services Group LLC acts as the Debtors' claims, noticing, and balloting agent. Blue Water's bankruptcy petition lists assets and liabilities each in the range of US$100 million to US$500 million. The hearing on the Debtors' disclosure statement and plan is set for Aug. 5, 2008. (Blue Water Automotive Bankruptcy News, Issue No. 13, Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) BLUE WATER: Hearing on Case Conversion Set for May 12 ----------------------------------------------------- Blue Water Automotive Systems, Inc. and its affiliated debtors and its Official Committee of Unsecured Creditors agree to adjourn the hearing on the panel's request to convert the Debtors' Chapter 11 cases to cases under Chapter 7 of the Bankruptcy Code to May 12, 2008. Objections are due May 9, 2008. The United States Bankruptcy Court Eastern District of Michigan approved the parties' stipulation. As reported in the Troubled Company Reporter on March 31, 2008, the Committee batted for the conversion of Blue Water's cases based on its apprehensions that the Debtors would only incur more debts if they continue operations, further diminishing recovery by creditors. Ford Motor Company, one of Blue Water Automotive Systems, Inc.'s key customers, asserted that conversion of the Chapter 11 cases to Chapter 7 is not in the best interest of creditors and the estates, the TCR reported April 25. "As several courts have emphasized, short term operating losses are not unusual during the first few months of a Chapter 11 case and they certainly do not provide a basis for the drastic remedy of conversion. The Debtor's rehabilitation is not a hopeless and unrealistic prospect as it will have positive EBITDA of US$11 million in 2008," asserted Ford's counsel, Timothy A. Fusco, Esq., at Miller, Canfield, Paddock and Stone, PLC, in Detroit, Michigan. Blue Water Automotive Systems, Inc. designs and manufactures engineered thermoplastic components and assemblies for the automotive industry. The company's product categories include airflow management, full interior trim/sub-systems, functional plastic components, and value-added assemblies. They are supported by full-service design, program management, manufacturing and tooling capabilities. With more than 1,400 employees, Blue Water operates eight manufacturing and product development facilities and has annual revenues of approximately US$200 million. The company's headquarters and technology center is located in Marysville, Mich. The company has operation in Mexico. In 2005, KPS Special Situations Fund II, L.P., and KPS Special Situations Fund II(A), L.P., acquired Blue Water Automotive through a stock purchase transaction. In 2006, the company acquired the automotive assets and operations of Injectronics, Inc., a manufacturer of thermoplastic injection molded components and assemblies. KPS then set about reorganizing the company. The company implemented a program to improve operating performance and address its liquidity issues. During 2007, the company replaced senior management, closed two facilities, and reduced overhead spending by one third. Blue Water Automotive and four affiliates filed for chapter 11 bankruptcy protection Feb. 12, 2008, before the United States Bankruptcy Court Eastern District of Michigan (Detroit) (Case No. 08-43196). Judy O'Neill, Esq., and Frank DiCastri, Esq., at Foley & Lardner, LLP, serves as the Debtors' bankruptcy counsel. Administar Services Group LLC acts as the Debtors' claims, noticing, and balloting agent. Blue Water's bankruptcy petition lists assets and liabilities each in the range of US$100 million to US$500 million. The hearing on the Debtors' disclosure statement and plan is set for Aug. 5, 2008. (Blue Water Automotive Bankruptcy News, Issue No. 13, Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) BON-TON STORES: Earns $11.6 Million in Fiscal Year Ended Feb. 2 --------------------------------------------------------------- The Bon-Ton Stores Inc. reported net income of $11.6 million for the fifty-two week period ended Feb. 2, 2008, compared to net income of $46.9 million in the fifty-three week period of fiscal 2006. Net income in fiscal 2007 was negatively impacted by an asset impairment charge of $4.1 million on a pre-tax basis related to the reduction in the estimated net realizable value of certain store properties and a reduction in the value of two private label brand names. Net income in fiscal 2006 was negatively impacted by $2.9 million of charges for an impaired store property and a reduction in the value of duplicate information systems software. Total sales were relatively unchanged at $3.4 billion for the fifty-two week period of fiscal 2007, compared with $3.4 billion for the prior year period, which consisted of fifty-three weeks. Other income in the fifty-two week period of fiscal 2007 increased to $101.7 million, compared to $93.5 million in the fifty-three week prior year period, primarily due to the inclusion of thirteen weeks of Carson's (the Northern Department Store Group acquired from Saks Incorporated effective March 5, 2006) operations in the first quarter of fiscal 2007, as compared to eight weeks of Carson's operations in the first quarter of fiscal 2006, and an increase in the program revenue received under the Credit Card Program Agreement (CCPA) with HSBC. Gross margin dollars in 2007 decreased $27.7 million compared to 2006. The decrease in gross margin dollars primarily reflects the reduced sales volume attributable to a comparable store sales decrease of 6.5% and a decrease in the gross margin rate. Selling, general and administrative expense increased $9.3 million compared to 2006. The principal factors in the increase in SG&A expense were the inclusion of five incremental weeks of Carson's operations in the first quarter of 2007 as compared to the first quarter of 2006 and increases in those costs affected by normal inflationary adjustments. Depreciation and amortization expense and amortization of lease- related interests increased $19.2 million, to $126.1 million, in 2007 from $106.9 million in 2006, primarily the result of including thirteen weeks of Carson's operations in the first quarter of 2007 as compared to eight weeks of Carson's operations in the first quarter of 2006 as well as the increased expense associated with asset additions. Income from operations in 2007 was $125.7 million, or 3.7% of net sales, as compared to $173.7 million, or 5.2% of net sales, in 2006. Net interest expense in 2007 was $108.2 million, or 3.2% of net sales, as compared to $107.1 million, or 3.2% of net sales, in 2006. The $1.0 million increase is principally due to the net additional weeks of interest expense on debt incurred in connection with the acquisition of Carson's compared to interest expense in the prior year, partially offset by a prior year charge of $6.8 million for the write-off of fees associated with a bridge facility and the early extinguishment of previous debt. Liquidity and Capital Resources Prior to March 6, 2006, the company's primary sources of working capital were cash flows from operations and borrowings under its revolving credit facility. On March 6, 2006, to finance the acquisition of Carson's and the related payoff of its previous revolving credit facility, the company entered into a new Senior Secured Credit Facility that provides for up to $1.0 billion in borrowings, issued $510.0 million in senior unsecured notes and entered into a new mortgage loan facility in the aggregate principal amount of $260.0 million. As of Feb. 2, 2008, the company had borrowings of $310.8 million, with $351.0 million of borrowing availability and letter-of-credit commitments of $14.0 million under its Senior Secured Credit Facility. Capital expenditures for 2007 totaled $109.7 million, compared with $95.2 million for 2006. The company anticipates that cash flows from operations, supplemented by borrowings under the Senior Secured Credit Facility, will be sufficient to satisfy operating cash requirements for at least the next twelve months. Balance Sheet At Feb. 2, 2008, the company's consolidated balance sheet showed $2.1 billion in total assets, $1.7 billion in total liabilities, and $363.1 million in total stockholders' equity. Full-text copies of the company's consolidated financial statements for the year ended Feb. 2, 2008, are available for free at http://researcharchives.com/t/s?2b88 About The Bon-Ton Stores York, Pennsylvania-based The Bon Ton Stores Inc. (Nasdaq: BONT) -- http://www.bonton.com/-- operates 280 department stores, which includes eleven furniture galleries, in 23 states in the Northeast, Midwest and upper Great Plains under the Bon-Ton, Bergner's, Boston Store, Carson Pirie Scott, Elder-Beerman, Herberger's and Younkers nameplates and, under the Parisian nameplate, three stores in the Detroit, Michigan area. The stores offer a broad assortment of brand-name fashion apparel and accessories for women, men and children, as well as cosmetics and home furnishings. * * * As reported in the Troubled Company Reporter on March 17, 2008, Fitch Ratings affirmed The Bon-Ton Stores, Inc.'s 'B' issuer default rating. The rating outlook has been revised to negative from stable. As reported in the Troubled Company Reporter on Feb. 13, 2008, Moody's Investors Service downgraded the corporate family rating of Bon-Ton Stores Inc. to B2 from B1, downgraded the probability of default rating to B2 from B1, and downgraded the rating on the $510 million senior unsecured notes to Caa1 (LGD 5, 78%) from B3 (LGD 5, 83%). The company's speculative grade liquidity rating of SGL-3 was affirmed. The outlook on all ratings is stable. BROOKLYN PSYCHIATRIC: Case Summary & 16 Largest Unsec. Creditors ---------------------------------------------------------------- Debtor: Brooklyn Psychiatric Centers, Inc. dba Brooklyn Care Works 189 Montague St. Brooklyn, NY 11201 Bankruptcy Case No.: 08-42658 Type of Business: The Debtor treats individuals and families who suffer emotional distress. Its 100 mental health professionals conduct more than 60,000 sessions annually at five community-based mental health clinics in Bushwick, Canarsie, Flatbush-Sheepshead Bay, Williamsburg- Greenpoint, and downtown Brooklyn; an outpatient drug and alcohol treatment program for individuals with co-existing mental health issues and chemical addictions; on-site programs in the public schools; a prevention program serving at-risk children and their families; senior programs, and a specialized mental health program. See http://www.brooklyncareworks.org/ Chapter 11 Petition Date: April 30, 2008 Court: Eastern District of New York (Brooklyn) Judge: Jerome Feller Debtor's Counsel: Gary C. Fischoff, Esq. Email: gcf@title11.net Steinberg, Fineo, Berger & Fischoff 40 Crossways Park Dr. Woodbury, NY 11797 Tel: (516) 747-1136 Estimated Assets: $1 million to $10 million Estimated Debts: $1 million to $10 million Debtor's 16 Largest Unsecured Creditors: Entity Claim Amount ------ ------------ Seedco Financial Services, $500,000 Inc. 915 Broadway 17th Flr. New York, NY 10010 1199SEIU United Heathcare $165,462 Workers East Levy Ratner PC 80 Eighth Ave. New York, NY 10011 Bank of America NA $115,817 Attn: Capital Mgmt. Markets Svc. Grp. 555 SW Flower St. 6th Flr. Los Angeles, CA 90071 Healthnet of New York $107,914 Peter Moschovitis $85,028 Rockaway Parkway Assoc. $72,860 The Vantage Consulting Group, $68,750 Inc. Kazlow and Kazlow $59,628 Mirram Global, LLC $32,500 Joseph P. Day Realty Corp. $29,912 44 Court Street LLC $25,818 JPMorgan Chase Bank NA $18,822 Family Services Network of NY $17,100 Con Edison $14,087 RSM McGladrey $13,346 Brown McMahon & Weinraub, LLC $12,000 CASH SYSTEMS: Has Until July 31 to Comply with Nasdaq Criteria -------------------------------------------------------------- Cash Systems Inc. received a letter from The NASDAQ Stock Market indicating that the company failed to comply with the minimum bid price requirement for continued listing set forth in Marketplace Rule 4450(a)(5) because the bid price of its common stock closed under $1.00 for the last 30 consecutive business days. The company also obtained a letter from NASDAQ, indicating that the company's common stock has not maintained a minimum market value of publicly held shares of $15 million as required for continued listing by Marketplace Rule 4450(b)(3). The NASDAQ letters have no effect on the listing of the company's common stock at this time. In accordance with NASDAQ Marketplace Rule 4450(e)(2), the company will be provided 180 calendar days, or until Oct. 28, 2008, to regain compliance with the minimum bid price requirement. To regain compliance with this requirement, the closing bid price of the company's common stock must remain at or above $1.00 per share for a minimum of 10 consecutive business days on or before Oct. 28, 2008. In accordance with NASDAQ Marketplace Rule 4450(e)(1), the company will be provided 90 calendar days, or until July 31, 2008, to regain compliance with the minimum market value of publicly held shares. To regain compliance with this requirement, the company's minimum market value of publicly held shares must trade at $15 million or more for ten consecutive trading days before July 31, 2008. If the company not be able to demonstrate compliance with Marketplace Rule 4450(e)(1) by July 31, 2008, or with Marketplace Rule 4450(a)(5) by Oct. 28, 2008, the NASDAQ staff will provide written notification that the company's common stock will be delisted. At that time, the company may appeal the staff's determination to delist its common stock to a Listing Qualifications Panel. Alternatively, the company could apply to transfer its common stock to The NASDAQ Capital Market if it satisfies all requirements, other than the minimum closing bid price requirement, for initial inclusion set forth in Marketplace Rule 4310(c). If an application is approved and the company otherwise maintains compliance with the listing requirements for The NASDAQ Capital Market, the company would be afforded an additional 180 calendar days to regain compliance with the minimum closing bid price requirement while listed on The NASDAQ Capital Market. About Cash Systems Inc. Based in Las Vegas, Nevada, Cash Systems Inc. (NASDAQ:CKNN) -- http://www.cashsystemsinc.com/-- is a provider of cash-access and related services to the retail and gaming industries. Cash Systems' products include its proprietary cash advance systems, ATMs and check cashing solutions. The company has additional offices in San Diego and Minneapolis. * * * As reported in the Troubled Company Reporter on April 29, 2008, Virchow Krause & Company LLP, in Minneapolis, raised substantial doubt on the ability of Cash Systems Inc., to continue as a going concern after auditing the company's consolidated financial statements for the years ended Dec. 31, 2007, and 2006. The auditing firm pointed to the company's recurring operating losses, negative cash flows from operations, negative working capital and accumulated deficit. Additionally, holders of notes have an option to put $12.1 million in outstanding notes to the company in October 2008. Virchow Krause also said that the company did not maintain, in all material respects, effective internal control over financial reporting as of Dec. 31, 2007. CEDAR MANAGEMENT: Files For Chapter 11 Protection in California --------------------------------------------------------------- Cedar Management LLC aka Cedar Signature Home files for relief under Chapter 11 of the Bankruptcy Code from its creditors, Tiffany Kary of Bloomberg News reports. Cedar Management owes $13.7 million to Keybank National Association, $10.4 million to Redwood Mortgage Investors VII and $8.2 million to Preferred Bank, Ms. Kary says. Cedar Management listed assets of at least $10 million and debts between $50 million to $100 million, she adds. Headquartered in Santa Monica, California, Cedar Management LLC aka Cedar Signature Home develops real estate. It also develops condominiums and townhomes near Santa Monica Beach. CHARMING SHOPPES: Moody's Withdraws Ratings for Business Reasons ---------------------------------------------------------------- These ratings of Charming Shoppes, Inc. have been withdrawn: -- The B2 Corporate Family rating; -- The B2 Probability of Default Rating. Moody's has withdrawn these ratings for business reasons. Moody's added that the ratings were withdrawn because this issuer has no rated debt outstanding. CHURCH & DWIGHT: Buys Del Pharma Biz from Coty Inc. at $380 Mil. ---------------------------------------------------------------- Church & Dwight Co. Inc. signed a definitive agreement to acquire the Del Pharmaceuticals Inc. business for $380 million in cash from Coty Inc. The transaction, which is subject to regulatory approval and other customary conditions, is expected to close in July 2008. Del Pharmaceuticals' net sales in the fiscal year ended Dec. 31, 2007 were approximately $100 million. Over three quarters of those sales were from the Orajel(R) brand, the premium-priced #1 brand in the fast-growing oral analgesic category, with remaining sales from a variety of other OTC brands. Church & Dwight's 2007 net sales of $2.2 billion include a premium oral care business led by the Arm & Hammer toothpaste and SpinBrush brands. According to the company, adding the Orajel brand will immediately increase the gross margin for the company and will complement the strategy of building scale in core categories. The brand will be integrated into the company's existing oral care business. "Orajel is a great addition to our existing portfolio and provides access to a fast-growing segment of the attractive premium oral care category," James R. Craigie, chairman and chief executive officer, said. "Orajel also brings to our company a powerful franchise that has developed great consumer loyalty." "This transaction is consistent with our growth strategy of strengthening our businesses by adding #1 or #2 brands in areas of high growth potential with gross margins that are accretive to the overall company," Mr. Craigie added. "It was important for Coty to identify the most suitable purchaser who will provide the best opportunity to grow this portfolio," Bernd Beetz, chief executive officer of Coty Inc., said. "While these pharmaceutical brands are highly respected, we remain focused on building and strengthening our core beauty business comprised of fragrance, color cosmetics, skin care and toiletries." Church & Dwight expects to combine operations which will result in additional cost synergies of over $10 million a year by the end of 2009. The Orajel products are expected to be integrated into existing Church & Dwight manufacturing facilities by the end of 2009. The transaction is structured as an asset purchase resulting in a cash tax benefit from intangibles amortization with a net present value of $90 million. The company will finance the acquisition with an addition to its bank credit facility combined with available cash and existing lines of credit. The acquisition is expected to have a neutral impact on 2008 earnings per share due primarily to one-time integration costs and the step-up of inventory. "We expect it to be accretive in 2009 and contribute meaningfully to earnings and free cash flow," Mr. Craigie concluded. "We also remain comfortable with our previously announced objective of achieving $2.77 in earnings per share for 2008, including any impact from the acquisition." About Church & Dwight Headquartered in Princeton, New Jersey, Church & Dwight Co. Inc. (NYSE: CHD) -- http://www.churchdwight.com/-- manufactures and markets a wide range of personal care, household and specialty products, under the Arm & Hammer brand name and other well-known trademarks. CHURCH & DWIGHT: Moody's Keeps 'Ba1' Ratings on Del Pharma Deal --------------------------------------------------------------- Moody's Investors Service affirmed Church & Dwight Company Inc.'s Ba1 corporate family and probability of default ratings following the proposed debt financing of the company's acquisition of the assets of Del Pharmaceuticals (primarily the Orajel brand of products) for $380 million. In addition, Moody's assigned a Baa3 to the company's $100 million revolving credit facility and affirmed the Baa3 senior secured bank rating and Ba2 senior subordinated note rating. The rating on the company's senior convertible debenture was lowered to Ba2 from Ba1 as a result of the increase in its subordination to the senior secured debt used to finance the transaction. The rating outlook remains stable. Ratings affirmed include These: -- Corporate family rating at Ba1; -- Probability of default rating at Ba1; -- $641 million senior secured term loan A facility, affirmed at Baa3 (LGD-2, 29%); -- $250 million senior subordinated notes, affirmed at Ba2 (LGD-5, 87%); Rating assigned: -- $100 million senior secured revolving credit facility, Baa3 (LGD-2, 29%) Rating downgraded includes These: -- $100 million convertible senior debentures to Ba2 (LGD-4, 69%) from Ba1 (LGD-4, 56%); -- Outlook is stable. Church & Dwight's Ba1 corporate family rating continues to reflect the company's strong operating performance and proven ability to efficiently integrate new acquisitions as well as its strong credit metrics, particularly for the Ba1 rating category. The company's liquidity remains very good following the acquisition supported by its improving free cash flow and interest coverage. According to Christina Padgett, Senior Vice President, "Church & Dwight's current acquisition fits well with the company's portfolio of branded consumer products and is likely to contribute to margin expansion. Importantly, the company's conservative credit metrics allow for meaningful flexibility within the rating category despite a mostly debt-financed acquisition." Constraints on the rating include the company's modest size relative to many of its competitors, its speculative grade oriented capital structure, particularly the high proportion of secured debt, the intense competition prevalent in the consumer space and ongoing event risk given the focus on acquisitions. Church & Dwight Company Inc., based in Princeton, New Jersey, is a leading marketer and manufacturer of a broad portfolio of household and personal care consumer products, historically under the Arm and Hammer brand name, and is also the world's leading sodium bicarbonate producer. Total revenues for the last twelve months ended December 2007 were approximately $2.2 billion. CHURCH & DWIGHT: Stable Performance Cues S&P to Lift Rating to BB+ ------------------------------------------------------------------ Standard & Poor's Ratings Services raised its corporate credit rating on Church & Dwight Co. Inc. to 'BB+' from 'BB', and assigned a 'BBB' senior secured debt and '1' recovery rating to the company's planned up to $250 million term loan A facility. In addition, Standard & Poor's raised all of its existing issue- level ratings on the company by one notch, and removed the existing ratings from CreditWatch, where they were placed with positive implication on April 1, 2008. The outlook is stable. "The upgrade is based on Church & Dwight's stable operating performance in recent years and its successful track record of managing its acquisitive growth strategy to leverage levels consistent with the revised rating," said Standard & Poor's credit analyst Patrick Jeffrey. Standard & Poor's expects Church & Dwight's planned acquisition of the over-the-counter pharmaceutical business (Orajel) from Coty Inc. (unrated) for $380 million to result in pro forma debt leverage of less than 3x, and expects this transaction to be funded primarily with the new term loan maturing in 2012. "The company's good free cash flow generation provides flexibility to delever and help fund future acquisitions," said Mr. Jeffrey. The rating on Princeton, New Jersey-based Church & Dwight reflects the company's participation in the highly competitive personal care segment of the consumer products industry, its lack of geographic diversity, and its somewhat aggressive acquisition strategy. This is mitigated to an extent by its established consumer brands, stable operating performance, good free cash flow generation, and moderately leveraged balance sheet. CITIGROUP MORTGAGE: Moody's Downgrades Ratings on 45 Tranches ------------------------------------------------------------- Moody's Investors Service has downgraded the ratings of 45 tranches from 13 Alt-A transactions issued by Citigroup Mortgage Loan Trust. Seventeen tranches remain on review for possible further downgrade. Additionally, 27 tranches were placed on review for possible downgrade. The collateral backing these transactions consists primarily of first-lien, fixed and adjustable-rate, Alt-A mortgage loans. The ratings were downgraded, in general, based on higher than anticipated rates of delinquency, foreclosure, and REO in the underlying collateral relative to credit enhancement levels. The actions are a result of Moody's on-going review process. Complete rating actions are: Issuer: Citigroup Mortgage Loan Trust Inc. 2005-7 -- Cl. 1-A1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. 1-A2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. 1-A3, Placed on Review for Possible Downgrade, currently Aaa -- Cl. 1-A4, Placed on Review for Possible Downgrade, currently Aaa -- Cl. 1-AIO1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. 1-AIO2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. 1-B1, Downgraded to Ba1 from Aa2 -- Cl. 1-B2, Downgraded to B3 from A2; Placed Under Review for further Possible Downgrade -- Cl. 1-B3, Downgraded to Caa1 from Baa2; Placed Under Review for further Possible Downgrade Issuer: Citigroup Mortgage Loan Trust Series 2005-8 -- Cl. II-B1, Downgraded to A2 from Aa2 -- Cl. II-B2, Downgraded to Ba3 from A2 -- Cl. II-B3, Downgraded to B2 from Baa3; Placed Under Review for further Possible Downgrade Issuer: Citigroup Mortgage Loan Trust Series 2005-10 -- Cl. I-A12B, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-A34B, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-A5B, Placed on Review for Possible Downgrade, currently Aaa -- Cl. I-B1, Downgraded to Baa3 from Aa2 -- Cl. I-B2, Downgraded to B2 from A3; Placed Under Review for further Possible Downgrade -- Cl. I-B3, Downgraded to Caa1 from Ba2; Placed Under Review for further Possible Downgrade Issuer: Citigroup Mortgage Loan Trust, Series 2005-WF2 -- Cl. MF-1, Downgraded to Aa3 from Aa2 -- Cl. MF-2, Downgraded to Baa1 from A2 -- Cl. MF-3, Downgraded to B3 from Baa2 -- Cl. MF-4, Downgraded to B3 from Baa3; Placed Under Review for further Possible Downgrade -- Cl. MV-5, Downgraded to Baa2 from Baa1 -- Cl. MV-6, Downgraded to Caa1 from Baa2; Placed Under Review for further Possible Downgrade -- Cl. MV-7, Downgraded to Ca from Ba1 Issuer: Citigroup Mortgage Loan Trust 2006-4 -- Cl. B1, Downgraded to A1 from Aa2 -- Cl. B2, Downgraded to Ba2 from A2 -- Cl. B3, Downgraded to B1 from Baa3; Placed Under Review for further Possible Downgrade Issuer: Citigroup Mortgage Loan Trust 2006-AR3 -- Cl. 2-A12B, Placed on Review for Possible Downgrade, currently Aa1 -- Cl. 2-1AX, Placed on Review for Possible Downgrade, currently Aaa -- Cl. 2-2AX, Placed on Review for Possible Downgrade, currently Aaa -- Cl. 2-A34B, Placed on Review for Possible Downgrade, currently Aa1 Issuer: Citigroup Mortgage Loan Trust 2006-AR6 -- Cl. 2-A4, Placed on Review for Possible Downgrade, currently Aaa -- Cl. 2-M1, Downgraded to B2 from Aa2 -- Cl. 2-M2, Downgraded to B3 from Baa1; Placed Under Review for further Possible Downgrade -- Cl. 2-M3, Downgraded to Caa1 from Ba1; Placed Under Review for further Possible Downgrade -- Cl. 2-M4, Downgraded to Ca from Ba3 Issuer: Citigroup Mortgage Loan Trust 2006-FX1 -- Cl. M-2, Downgraded to Baa2 from A2 -- Cl. M-3, Downgraded to B2 from Baa2; Placed Under Review for further Possible Downgrade -- Cl. M-4, Downgraded to Ca from Ba1 Issuer: Citigroup Mortgage Loan Trust Inc. 2006-WF1 -- Cl. M-1, Downgraded to Baa1 from Aa2 -- Cl. M-2, Downgraded to B2 from Baa1; Placed Under Review for further Possible Downgrade -- Cl. M-3, Downgraded to Ca from Ba2 -- Cl. M-4, Downgraded to Ca from B1 -- Cl. M-5, Downgraded to Ca from Caa2 Issuer: Citigroup Mortgage Loan Trust Inc. 2006-WF2 -- Cl. M-1, Downgraded to Baa2 from Aa2 -- Cl. M-2, Downgraded to B2 from Baa1; Placed Under Review for further Possible Downgrade -- Cl. M-3, Downgraded to Ca from Ba1 -- Cl. M-4, Downgraded to Ca from B3 -- Cl. M-5, Downgraded to Ca from Caa3 Issuer: Citigroup Mortgage Loan Trust 2007-AR1 -- Cl. A1, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. M1, Downgraded to B3 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. M2, Downgraded to Ca from B1 Issuer: Citigroup Mortgage Loan Trust 2007-AR7 -- Cl. 3IO, Placed on Review for Possible Downgrade, currently Aaa -- Cl. 4IO, Placed on Review for Possible Downgrade, currently Aaa -- Cl. B1, Downgraded to B3 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. B2, Downgraded to Ca from B3 -- Cl. B3, Downgraded to Ca from Caa3 Issuer: Citigroup Mortgage Loan Trust 2007-OPX1 -- Cl. A-1A, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-1B, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-2, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-3A, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-3B, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-4A, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-4B, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-5A, Placed on Review for Possible Downgrade, currently Aaa -- Cl. A-5B, Placed on Review for Possible Downgrade, currently Aaa -- Cl. M-1, Downgraded to Ba1 from Aa2; Placed Under Review for further Possible Downgrade -- Cl. M-2, Downgraded to B3 from Baa2; Placed Under Review for further Possible Downgrade -- Cl. M-3, Downgraded to Ca from Ba3 -- Cl. M-4, Downgraded to Ca from B1 CLEBURNE & TM: Voluntary Chapter 11 Case Summary ------------------------------------------------ Lead Debtor: Cleburne & TM, L.P. 2911 E. Division St. Ste. 411 Arlington, TX 76011 Bankruptcy Case No.: 08-32193 Debtor-affiliates filing separate Chapter 11 petitions: Entity Case No. ------ -------- 65 Acres, L.P. 08-32186 IE 30, Inc. 08-32195 Corpus Sunrise Mall, L.P. 08-32196 Six Flags Mall, L.P. 08-32201 Arlington & TM, L.P. 08-32203 Lone Star Plaza 08-32205 Chapter 11 Petition Date: May 5, 2008 Court: Northern District of Texas (Dallas) Debtors' Counsel: Joyce W. Lindauer, Esq. Email: courts@joycelindauer.com 8140 Walnut Hill Lane, Ste. 301 Dallas, TX 75231 Tel: (972) 503-4033 Fax: (972) 503-4034 -- and -- Arthur I. Ungerman, Esq. Email: arthur@arthurungerman.com One Glen Lakes Tower 8140 Walnut Hill Ln., No. 301 Dallas, TX 75231 Tel: (972) 239-9055 Fax: (972) 239-9886 Estimated Assets: $10 million to $50 million Estimated Debts: $1 million to $10 million The Debtors did not file lists of their largest unsecured creditors. COMPASS MINERALS: Planned Note Redemption Cues S&P's Pos. Watch --------------------------------------------------------------- Standard & Poor's Ratings Services placed its ratings, including its 'BB-' corporate credit rating, on Overland Park, Kansas-based Compass Minerals International Inc. on CreditWatch with positive implications. "The CreditWatch listing followed the company's announcement that it plans to redeem $70 million of 12% senior subordinated notes due 2013 with existing sources of liquidity, thus lowering the company's overall borrowing costs," said Standard & Poor's credit analyst Anna Alemani. "The CreditWatch listing also reflects the company's continued good operating performance and prospects for sustained profitability and cash flow in the near term." As of March 31, 2008, and pro forma for the announced debt reduction, Compass Minerals' adjusted debt to EBITDA is 2.5x, while funds from operation to total debt is 28%, measures that S&P consider to be good for the current rating. "In resolving the CreditWatch listing, we will meet with management and review both its near- and intermediate-term business and financial strategies," Ms. Alemani said. "If, as a result, we were to raise the rating, we would limit it to one notch." COUNTRYWIDE FINANCIAL: Fitch Puts All Ratings Under Evolving Watch ------------------------------------------------------------------ Fitch Ratings has placed all ratings of Countrywide Financial Corporation on Rating Watch Evolving, removing them from Rating Watch Positive. The Rating Watch Evolving reflects further disclosure surrounding Bank of America's treatment of CFC debt following the acquisition. While Fitch continues to believe that BAC's acquisition of CFC will likely close, the rating action considers uncertainty over the transaction's final structure. As disclosed in BAC's amended S-4 filed on May 1, 2008, BAC left open the possibility that any remaining CFC debt could remain obligations of CFC and not BAC. Further, BAC made no assurances that such debt would be redeemed, assumed or guaranteed. Any structure that does not result in full BAC support of CFC could result in some or all CFC ratings being notched below those of BAC, with the potential for significant notching, including CFC debt being downgraded below its current level. Conversely, depending upon the ultimate structure, some or all of CFC's ratings could be equalized with BAC ratings. (BAC rated 'AA/F1+', Rating Watch Negative by Fitch.) CFC's ratings had been on Rating Watch Positive pending the acquisition of CFC by BAC, announced in January 2008. Since that time, BAC has repeatedly indicated its expectation that the transaction will be completed and Fitch continues to believe that the probability that the transaction is completed remains extremely high. However, BAC has been unusually silent regarding the ultimate structure of the transaction CFC's results have deteriorated further as the residential mortgage sector continues to weaken. First quarter results produced a net loss of $983 million, more than double the loss recorded in the final quarter of 2007. CFC recorded sharply higher loan loss provisions, increased provisions for representations and warranty claims, increased provisions for captive mortgage insurance claims, and a high, albeit reduced, level of impairment of retained interests. Given CFC's operating difficulties and the stressed environment, CFC's ratings would be likely be downgraded absent the capital and liquidity support already provided by BAC, and more likely still if the merger is not consummated. These ratings have been removed from Rating Watch Positive to Rating Watch Evolving Countrywide Financial Corp. -- Long-term Issuer Default Rating 'BBB-'; -- Short-term IDR 'F3'; -- Individual 'C/D'; -- Senior debt 'BBB-'; -- Subordinated 'BB+; -- Commercial paper 'F3'; -- Support '5'; -- Support floor 'NF'. Countrywide Bank FSB -- Long-term IDR 'BBB-'; -- Short-term IDR 'F3'; -- Individual 'C/D'; -- Senior debt 'BBB-'; -- Long-term deposits 'BBB-'; -- Short-term deposits 'F3'; -- Short-term debt 'F3'; -- Support '5'; -- Support floor 'NF'. Countrywide Home Loans, Inc. -- Long-term IDR 'BBB-'; -- Short-term IDR 'F3'; -- Senior debt 'BBB-'; -- Commercial paper 'F3'. Countrywide Capital I, III, IV, V -- Trust preferred 'BB'. DELPHI CORP: Plastech Can Return Tooling to Delphi Automotive ------------------------------------------------------------- Plastech Engineered Products Inc. and its debtor-affiliates obtained permission from the U.S. Bankruptcy Court for the Eastern District of Michigan to return certain tooling equipment to Delphi Automotive Systems LLC. As reported in the Troubled Company Reporter on April 21, 2008, the Debtors sought authority specifically to: (a) surrender certain tooling owned by Delphi Automotive Systems, LLC, that is in the Debtors' possession; and (b) sell to Delphi certain de minimis finished goods inventory made with the Delphi tooling for $4,671, free and clear of liens. The Debtors also asked the Court to lift the automatic stay to effectuate the release of tooling and the sale of the de minimis inventory to Delphi. The Debtors currently are in possession of certain tooling which is fully paid for and is owned by Delphi at a plant in Croswell, Michigan, that was used to make service parts for Delphi's Powertrain Division that are no longer in production. The Debtors informed that the Inventory represents idle assets that are of little or no use or value to the Debtors' estates or restructuring efforts, as the Inventory consists of service parts that are no longer in production. The Debtors have determined in their sound business judgment that the sale of the Inventory to Delphi is the most efficient way to convert idle assets of de minimis value into cash. The Debtors believe that the sale of the inventory to Delphi is commercially reasonable in light of the assets being sold and as a result, the value of the proceeds from the sale fairly reflects the value of the Inventory sold. The Debtors proposed that any party with a lien on the Inventory be given a corresponding security interest in the proceeds of the sale. In light of these, the requirements of Section 363(f) of the Bankruptcy Code would be satisfied for any proposed sales free and clear of liens, the Debtors said. Moreover, because the Debtors have no further need for the Delphi Tooling, the Debtors believe that the automatic stay should be lifted pursuant to Section 362(d) of the Bankruptcy Code to allow Delphi to take possession of the Delphi Tooling and to deem the applicable purchase orders between Delphi and the Debtors terminated upon the return of the Delphi Tooling and payment for the Inventory. About Plastech Engineered Based in Dearborn, Michigan, Plastech Engineered Products, Inc. -- http://www.plastecheng.com/-- is full-service automotive supplier of interior, exterior and underhood components. It designs and manufactures blow-molded and injection-molded plastic products primarily for the automotive industry. Plastech's products include automotive interior trim, underhood components, bumper and other exterior components, and cockpit modules. Plastech's major customers are General Motors, Ford Motor Company, and Toyota, as well as Johnson Controls, Inc. Plastech is a privately held company and is the largest family- owned company in the state of Michigan. The company is certified as a Minority Business Enterprise by the state of Michigan. Plastech maintains more than 35 manufacturing facilities in the midwestern and southern United States. The company's products are sold through an in-house sales force. The company and eight of its affiliates filed for Chapter 11 protection on Feb. 1, 2008 (Bankr. E.D. Mich. Lead Case No. 08- 42417). Gregg M. Galardi, Esq., at Skadden Arps Slate Meagher & Flom LLP, and Deborah L. Fish, Esq., at Allard & Fish, P.C., represent the Debtors in their restructuring efforts. The Debtors chose Jones Day as their special corporate and litigation counsel. Lazard Freres & Co. LLC serves as the Debtors' investment bankers, while Conway, MacKenzie & Dunleavy provide financial advisory services. The Debtors also employed Donlin, Recano & Company as their claims and noticing agent. An Official Committee of Unsecured Creditors has been appointed in the Debtors' cases. As of Dec. 31, 2006, the company's books and records reflected assets totaling $729,000,000 and total liabilities of $695,000,000. (Plastech Bankruptcy News, Issue No. 19; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/ or 215/945-7000) About Delphi Corp. Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ) -- http://www.delphi.com/-- is the single supplier of vehicle electronics, transportation components, integrated systems and modules, and other electronic technology. The company's technology and products are present in more than 75 million vehicles on the road worldwide. Delphi has regional headquarters in Japan, Brazil and France. The company filed for Chapter 11 protection on Oct. 8, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP, represents the Official Committee of Unsecured Creditors. As of March 31, 2007, the Debtors' balance sheet showed $11,446,000,000 in total assets and $23,851,000,000 in total debts. The Court approved Delphi's First Amended Joint Disclosure Statement and related solicitation procedures for the solicitation of votes on the First Amended Plan on Dec. 20, 2007. The Court confirmed the Debtors' First Amended Plan on Jan. 25, 2008. DELPHI CORP: Court Extends Exclusive Plan-Filing Period to Aug. 31 ------------------------------------------------------------------ The U.S. Bankruptcy Court for the Southern District of New York extended Delphi Corp. and its debtor-affiliates' exclusive periods to file a plan of reorganization until 30 days after substantial consummation of the confirmed First Amended Joint Plan of Reorganization or any modified Plan, and their exclusive periods to solicit acceptances of that Plan until 90 days after substantial consummation of the First Amended Plan or modified Plan. The Court ruled that: (i) the Debtors' exclusive period under Section 1121(d) of the Bankruptcy Code for filing a plan of reorganization, as between the Debtors and the Official Committee of Unsecured Creditors and the Official Committee of Equity Security Holders is extended through and including August 31, 2008. (ii) The Debtors' exclusive period under Section 1121(d) for soliciting acceptance of a plan of reorganization, as between the Debtors and the Statutory Committees, is extended through and including October 31, 2008. As reported in the Troubled Company Reporter on April 17, 2008, out of an abundance of caution and to ensure clarity with their stakeholders, including their customers and supplies, the Debtors sought an extension of the Exclusive Periods to prevent any lapse in exclusivity, John Wm. Butler, Jr., Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, in Chicago, Illinois, clarified. A further extension of the Exclusive Periods, Mr. Butler said, is justified by the significant progress the Debtors have made toward emerging from Chapter 11. After obtaining confirmation of the First Amended Plan, the Debtors secured exit financing and met all other conditions to the effectiveness of the Plan and Investment Agreement and were prepared to emerge from Chapter 11. The Debtors' efforts to emerge from Chapter 11, however, were affected by severe dislocations in the capital markets that began late in the second quarter of 2007 and that have continued through the present, according to Mr. Butler. Although the Debtors eventually obtained the exit financing required by the First Amended Plan, the turbulence in the capital markets was a principal cause of the delay in the Debtors' emergence from Chapter 11 before the end of 2007, he maintained. Moreover, the decision by Appaloosa Management L.P. and the other Plan Investors to not honor their commitments in the parties' New Equity Purchase and Commitment Agreement prevented the Debtors from emerging on April 4, 2008. Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ) -- http://www.delphi.com/-- is the single supplier of vehicle electronics, transportation components, integrated systems and modules, and other electronic technology. The company's technology and products are present in more than 75 million vehicles on the road worldwide. Delphi has regional headquarters in Japan, Brazil and France. The company filed for Chapter 11 protection on Oct. 8, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP, represents the Official Committee of Unsecured Creditors. As of March 31, 2007, the Debtors' balance sheet showed $11,446,000,000 in total assets and $23,851,000,000 in total debts. The Court approved Delphi's First Amended Joint Disclosure Statement and related solicitation procedures for the solicitation of votes on the First Amended Plan on Dec. 20, 2007. The Court confirmed the Debtors' First Amended Plan on Jan. 25, 2008. (Delphi Bankruptcy News, Issue No. 127; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) DELPHI CORP: GM's Charges on Delphi Issues Reach $8.3 Billion ------------------------------------------------------------- General Motors Corp. said that during the first quarter of 2008, it took a non-cash charge of $731,000,000 to increase its liability for estimated net costs associated with its support of Delphi Corp.'s bankruptcy and restructuring efforts. "This charge primarily results from updated estimates reflecting uncertainty around the nature, value and timing of GM's recoveries," GM said. Delphi was scheduled to emerge from bankruptcy in mid-April but obtained problems with its exit equity financing from Appaloosa Management, PC, thus affecting the timing of GM's recoveries from Delphi. General Motors has now recorded charges totaling $8,300,000,000 in connection with Delphi-related issues, Reuters reports. GM has recently agreed to advance Delphi $650,000,000 in 2008 in anticipation of settlement agreements between the companies that would have been paid to the supplier had Delphi emerged from court protection as expected in April. General Motors also recorded a $1,450,000,000 non-cash partial impairment charge for its equity investment in its finance unit GMAC LLC for the first quarter of 2008. General Motors reported net losses of $3,251,000,000 on $42,700,000,000 of revenues for the first quarter. GM said its results were marked by improved adjusted automotive operating performance, rapid growth in emerging markets, continued cost performance in North America operations and liquidity of nearly $24,000,000,000, despite the impact of the American Axle strike and weakness in the U.S. auto industry. Bloomberg News said the loss was smaller than analysts estimated, causing GM shares to gain 9.4% in the New York Stock Exchange. GM's loss excluding costs for Delphi and the GMAC was $350,000,000, or 62 cents a share, beating the $1.52 average estimate of 13 analysts surveyed by Bloomberg. GM said that in light of the current state of the U.S. economy and automotive industry, it has revised its 2008 U.S. industry seasonally adjusted annual rate outlook to the mid to high 15 million unit range, down from the low 16 million unit range. As a result of the anticipated softer automotive industry, GM announced earlier this week that it will eliminate a shift of production at four assembly plants: Janesville, Wisconsin; Pontiac and Flint, Michigan; and Oshawa, Ontario. Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ) -- http://www.delphi.com/-- is the single supplier of vehicle electronics, transportation components, integrated systems and modules, and other electronic technology. The company's technology and products are present in more than 75 million vehicles on the road worldwide. Delphi has regional headquarters in Japan, Brazil and France. The company filed for Chapter 11 protection on Oct. 8, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP, represents the Official Committee of Unsecured Creditors. As of March 31, 2007, the Debtors' balance sheet showed $11,446,000,000 in total assets and $23,851,000,000 in total debts. The Court approved Delphi's First Amended Joint Disclosure Statement and related solicitation procedures for the solicitation of votes on the First Amended Plan on Dec. 20, 2007. The Court confirmed the Debtors' First Amended Plan on Jan. 25, 2008. (Delphi Bankruptcy News, Issue No. 127; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) DIAMOND GLASS: Can Hire Getzler Henrich as Financial Advisor ------------------------------------------------------------ Diamond Glass Inc. and DT Subsidiary Corp. obtained permission from the U.S. Bankruptcy Court for the District of Delaware to employ Getzler Henrich & Associates LLC as their management consultant and financial advisor, nunc pro tunc to April 1, 2008. Getzler Henrich is expected to assist the Debtors' management in the development of its restructuring options, determination of the Debtors' cash requirements, and in the bankruptcy process to minimize costs associated with the Chapter 11 filing. William H. Henrich, a vice chairman at Getzler Henrich, told the Court that the firm's professionals bill at these hourly rates: Principal & Managing Director $395 - $525 Director & Specialist $335 - $475 Associate $235 - $335 Mr. Henrich assured the Court that the firm is disinterested as <