TCR_Public/080516.mbx          T R O U B L E D   C O M P A N Y   R E P O R T E R

               Friday, May 16, 2008, Vol. 12, No. 116

                             Headlines

ABOVE THE SMOKE: Voluntary Chapter 11 Case Summary
ABS GLOBAL FINANCE: Fitch Affirms Class E-1 Notes' BB Rating
ACXIOM CORP: Posts $58.2 Million Net Loss in First Quarter 2008
AES CORP: Fitch Rates Senior Unsecured Notes 'BB/RR1'
AES CORP: Moody's Puts B1 Rating on $600MM Senior Unsecured Notes

ALASKA AIR: Moody's Affirms All Ratings; Changes Outlook to Neg.
AMERICAN AXLE: UAW Talks Stall Over Health & Unemployment Benefits
AMERICAN HOME TRUST: S&P's Affirms 'B' Rating on Class M-5 Notes
AMERICAN HOME TRUST: S&P Slashes Rating to 'D' on Cl. II-M-1 Trust
AMP'D MOBILE: Files $90,982 Preference Suit Against LetsTalk.Com

AMP'D MOBILE: Inks Stipulation Rejecting Westside Medical Lease
AMPEX CORP: Judge Sees Appointment of Equity Holders Panel as Moot
ASCALADE COMM: Hong Kong Court OKs ACL's Scheme of Arrangement
ATHERTON & JENNINGS: Case Summary & Three Largest Unsec. Creditors
BEAR STEARNS ABS: Fitch Rates 57 Classes Below Investment Grade

BERRY PLASTICS: Posts $29.3MM Net Loss in Quarter Ended March 29
BLOCKBUSTER INC: Earns $45 Million in Quarter ended April 6
BLUE SKY 2: Case Summary & Two Largest Unsecured Creditors
BLUE WATER: Files Liquidation Analysis Under Chapter 11 Plan
BLUE WATER: Gets Permission to Pay Incentives to Employees

BOISE INC: Moody's Lifts Loan Rtng. to B1; Revises Outlook to Pos.
BUFFETS HOLDINGS: U.S. Trustee Balks at Employees Incentive Plan
BUFFETS HOLDINGS: Court Sets July 21 as Claims Bar Date
BUFFETS HOLDINGS: Wants to Limit Bank's Rights to Value Collateral
BUFFETS HOLDINGS: Wants Court's Okay to Amend Asset Sale Contract

CABLEVISION SYSTEMS: Moody's Rtngs. Unmoved by Pending Acquisition
CAPITAL AUTO: S&P Puts 'BB' Rating on $7.915MM Subordinate Notes
CDC COMMERCIAL: Moody's Holds B3 Rating on $3.187MM Class P Certs.
CENTERSTAGING MUSICAL: Seeks to Hire Lewis Landau as Counsel
CENTERSTAGING MUSICAL: Can Employ Biggs & Co. as Accountant

CENTERSTAGING MUSICAL: U.S. Trustee Forms Three-Member Committee
CHESAPEAKE CORP: Obtains $250MM Replacement Facility from GECC
CHESAPEAKE CORP: In Talks to Amend U.K. Pension Recovery Plan
CHRYSLER LLC: Reaches Tentative Settlements with CAW Officials
CIMAREX ENERGY: S&P Lifts Credit Rating to BB with Stable Outlook

CITIGROUP COMMERCIAL: Moody's Affirms Ba1 Rating on Class L Certs.
CITIGROUP COMMERCIAL: Moody's Cuts Rating to Caa1 on Class O Cert.
CLEAR CHANNEL: Inks Settlement Agreement with CC Media and Lenders
CLFX CORP: Full Payment of Debt Cues Moody's to Withdraw Ratings
COMM 2007-FL14: Stable Performance Cues Moody's to Hold Ratings

CONTINENTAL AIR: Sets Alliance with UAL After Failed Merger
COUNTRY-WIDE INSURANCE: A.M. Best Lifts IC Rating to bb- from b
CSFB MORTGAGE: Moody's Holds Junked Ratings on Two Cert. Classes
CRYOCATH TECHNOLOGIES: March 31 Balance Sheet Upside-Down by $6MM
CSFB MANUFACTURED: S&P Cuts Rating on Class B-1 Certificates to B+

CSMC TRUST: S&P Junks Ratings on Seven Cert. Classes
CY ORIENTAL: Gets Consent from Lender to File Records Until May 31
EINSTEIN NOAH: Inks Interest Rate Swap Deal with Wells Fargo
ENCAP GOLF: Taps Cole Schotz as Bankruptcy Counsel
ENERGY PARTNERS: Posts $2.3 Million Net Loss in 2008 First Quarter

EPICEPT CORP: Faces Nasdaq Delisting on Depressed Securities Value
EPICEPT CORP: Amends Loan & Warrant Pacts with Hercules Technology
FLEETWOOD ENTERPRISES: Sells Property to Finance Bond Redemption
FOOTSTAR INC: Board Intends to Liquidate Company by End of 2008
GENERAL MOTORS: Reaches Tentative Settlements with CAW Officials

GENERAL MOTORS: CAW Balks at Announcement of Windsor Plant Closure
GREAT LAKES: A.M. Best Puts bb- IC Rating Under Positive Review
HAWAIIAN AIRLINES: Settles Litigation Involving Mesa Air Group
HEXION SPECIALTY: March 31 Balance Sheet Upside Down by $1.3 Bil.
IDLEAIRE TECH: Files for Chapter 11 Protection in Delaware

IDLEAIRE TECHNOLOGIES: Wants to Use $8 Million DIP Facility
IDLEAIRE TECHNOLOGIES: Depleting Cash Cues Sale to Investor Group
IDLEAIRE TECHNOLOGIES: To Engage Kurtzman Carson as Claims Agent
IDLEAIRE TECHNOLOGIES: Taps CRG's Stephen Gray as CRO
INTERTAPE POLYMER: Posts $2MM Net Loss in Quarter ended March 31

IRVINE SENSORS: Sells More Than 1% of Shares in Unregistered Deals
JABIL CIRCUIT: Moody's Rtng Unmoved by Planned $150MM Notes Add-On
JETBLUE AIRWAYS: Fitch Cuts Sr. Unsec. Notes' Rating to CCC-/RR6
JOURNAL REGISTER: Posts $72MM Net Loss in Quarter Ended March 30
JOURNAL REGISTER: Moody's Junks Rating on Likely Covenant Breach

JOHN HOWARD: Case Summary & Seven Known Creditors
JOHN DALY: Case Summary & Eight Known Creditors
KENTUCKY DATA: Moody's Holds B1 CF Rating; Changes Outlook to Pos.
LANDING DEVELOPMENT: Section 341(a) Meeting Set for May 20
LEHMAN ABS: S&P Chips 'BB+' Rating on Class M-1 Certs. to 'B-'

LEHMAN BROTHERS TRUST: Moody's Affirms Caa1 Rating on Certificates
LEVITT AND SONS: Administrator Taps Whelchel & Dunlap as Counsel
LEVITT AND SONS: Administrator Wants to Employ VHB as Consultant
LINENS N THINGS: Reports 2008 First Quarter Sales Results
LINENS N THINGS: Wants to Employ Richards Layton as Counsel

LINEN N THINGS: Wants to Employ Gardere as Special Counsel
MCKINNEY ZONE: Voluntary Chapter 11 Case Summary
MERGE HEALTHCARE: Posts $7.8 Million Net Loss in 2008 1st Quarter
MESA AIR: Settles Litigation Involving Hawaiian Airlines
MESA AIR: Won't File March 2008 Quarterly Report on Time

MESABA AVIATION: Andy Roberts Appointed to Lead Company
MESABA AVIATION: Liquidating Trustee Appeals MAC Ruling
MICROMET INC: Posts $5.9 Million Net Loss in 2008 First Quarter
ML-CFC COMMERCIAL: Moody's Holds B3 Rating on $4.603MM Cl. P Trust
MOORE CUSTOM: Case Summary & Four Largest Unsecured Creditors

MORGAN STANLEY: Moody's Holds Low-B Ratings on Four Cert. Classes
MOULDING FX: Voluntary Chapter 11 Case Summary
MTI GLOBAL: Has Until May 31 to Amend Credit Facility with Lender
NEW CENTURY: Claimants Buck Plan; Proponents Push for Confirmation
NEWPAGE CORP: S&P Holds 'B' Rating and Revises Outlook to Positive

NORD RESOURCES: March 31 Balance Sheet Upside-Down by $3 Million
NORTH AMERICAN: S&P Rates $545MM First-Lien Facilities BB+
NORTHWEST AIRLNES: Appoints Andy Roberts to Lead Mesaba
OMNI FINANCIAL: To Delay Filing Quarterly Report on Form 10-Q
PACIFIC LUMBER: Scopac Objects to Marathon/Mendocino, BoNY Plans

PACIFIC LUMBER: Lehman Offers $10-Mil. Loan for Scopac, BoNY Says
PACIFIC LUMBER: Sierra Pacific Willing to Buy Mills, BoNY Says
PARMALAT SPA: 1st Qtr Profit Down on Lesser Legal Settlements
PARMALAT SPA: Provides Updates on Legal Actions Against Citigroup
PENAMISADE LTD: Case Summary & Four Largest Unsecured Creditors

PHLA INC: Case Summary & Five Largest Unsecured Creditors
PILGRIM'S PRIDE: Equity Issuance Won't Affect Moody's Ratings
PROTECTION ONE: POI Acquisition Declares 46.6% Equity Stake
PROTECTION ONE: March 31 Balance Sheet Upside-Down by $45 Million
QIS INC: Case Summary & 20 Largest Unsecured Creditors

RAAC SERIES: S&P Lowers Ratings on Three Certificate Classes
RCS-CHANDLER: Section 341(a) Meeting Slated for May 27
RECKSON OPERATING: Fitch Says Ties To SL Green Factor in Ratings
RELIANT CHANNELVIEW: BoNY Balks at Further Use of Cash Collateral
RESIDENTIAL FUNDING: Moody's Cuts Rating on Cl. M-5 Loan to Ba2

ROADHOUSE GRILL: To Liquidate, End Leases of Restaurants
RUTLAND: Fitch Puts Class B3-LEK Notes' BB Rating on Neg. Watch
SANDRIDGE ENERGY: Prices $750 Million Offering of 8% Senior Notes
SANDRIDGE ENERGY: Moody's Rates Pending $750MM Note B3
SCRIPPS FRENCH: Case Summary & Seven Largest Unsecured Creditors

SENTINEL MANAGEMENT: Files Disclosure Statement in Illinois
SENTINEL MANAGEMENT: U.S. Trustee Amends Creditors' Panel Members
SHARPER IMAGE: Hilco Joint Venture Named Stalking Horse Bidder
SI INTERNATIONAL: S&P Withdraws Ratings at Company's Request
SIX FLAGS: Exchange Notes Offer Cues Moody's to Hold Caa1 Rating

SKYBUS AIRLINES: U.S. Trustee Appoints 5-Member Creditors Panel
SKYBUS AIRLINES: Files Schedules of Assets and Liabilities
SMI NEW HOME: Case Summary & 15 Largest Unsecured Creditors
SUNCREST LLC: Section 341(a) Meeting Scheduled for May 19
SUPERVALU INC: S&P Puts 'BB+' Rating on Existing $4BB Facilities

TRANSMERIDIAN EXPLO: March 31 Balance Sheet Upside-Down by $31MM
TRIAD FINANCIAL: Moody's Junks Ratings on Citigroup Deal Amendment
TROPICANA ENTERTAINMENT: Wants Lazard Freres as Financial Advisor
TROPICANA ENT: Endorses AlixPartners LLP as Restructuring Advisors
TROPICANA ENT: Wants to Hire Ernst & Young as Accounting Advisor

TRUMP ENTERTAINMENT: Harry Hagerty Joins Board of Directors
TW HOTEL: Improving Performance Cues Moody's to Lift Ratings
UAL CORP: Sets Pricing Alliance with Continental Airlines
UAL CORP: Name and Chicago HG Likely to Remain After USAir Merger
US AIRWAYS: Merger Likely to Retain UAL Name and Chicago HG

US SHIPPING: S&P Puts 'B-' Rating Under Neg. Watch on Poor Fin'l
UTSTARCOM INC: Expects Up to $590MM Revenues in 2008 First Quarter
VALERO ENERGY: El Paso Note Assumption Cues S&P to Cut Rating
VICORP RESTAURANTS: Panel Taps FTI Consulting as Financial Advisor
VICORP RESTAURANTS: Taps Morris Nichols as Conflicts Counsel

VICORP RESTAURANTS: Taps Piper Jaffray as Financial Advisor
VISTEON CORP: Appoints Donald Stebbins as Chief Executive Officer
WARNEX INC: March 31 Balance Sheet Upside-Down by C$1.3 Million
WELLMAN INC: Gets Extension on Deadline for Auction Protocol
WELLMAN INC: Wants Court to Extend Deadline to Remove Actions

* Fitch: Most Subprime-Related Bank Losses Are Already Disclosed
* S&P Downgrades Ratings on 169 Classes from 38 RMBS Transactions
* S&P Outlines Events that Could Affect Credit Card ABS Ratings

* BOOK REVIEW: The First Junk Bond: A Story of Corporate
                          Boom and Bust

                             *********

ABOVE THE SMOKE: Voluntary Chapter 11 Case Summary
--------------------------------------------------
Debtor: Above The Smoke
        P.O. Box 771
        Gatlinburg, TN 37738

Bankruptcy Case No.: 08-31972

Chapter 11 Petition Date: May 5, 2008

Court: Eastern District of Tennessee (Knoxville)

Debtor's Counsel: Edward J. Shultz, Esq.
                  Email: eshultz@ayreslaw.com
                  Ayres & Parkey
                  P.O. Box 23380
                  Knoxville, TN 37933
                  Tel: (865) 637-1181

Estimated Assets:        Less than $50,000

Estimated Debts: $1 million to $10 million

The Debtor does not have any creditors who are not insiders.


ABS GLOBAL FINANCE: Fitch Affirms Class E-1 Notes' BB Rating
------------------------------------------------------------
Fitch Ratings has affirmed and removed from Rating Watch Negative
(RWN) the class E-1 notes issued by ABS Global Finance Plc (ABS
Global), Series 2006-1:

   -- Class E-1 (USD2 million) notes affirmed at 'BB'; off RWN

The notes were placed on RWN on November 15, 2007, due to the
level of defaults experienced by the transaction.

According to the April 2008 servicer report, the credit
enhancement of the notes has been reduced to 0.66% from the
original 1% at closing. The notes' credit enhancement comprises
the class F-1 notes and the equity tranche, of which the equity
tranche has been depleted by 0.34% due to defaults.

The affirmation of the notes follows further analysis of the
current portfolio, in particular the obligors with the weakest
credit profile in the securitised asset pool. Fitch believes that
the current levels of credit enhancement are sufficient to protect
the class E-1 noteholders against losses that might arise from
further defaults, based on the different stressed scenarios that
defaults continue to occur until the expected maturity date.

The transaction is currently within its revolving period, during
which principal collections are used to purchase new eligible
receivables. From June 2008, the transaction administrator will
perform principal collection tests for each class of the notes,
which will measure whether underlying assets can generate
sufficient collections to redeem each class of notes at the
expected maturity date in December 2008. The tests will be
repeated every month from June to December 2008. If the principal
collection tests are not met, the revolving period will end and
the principal accumulation period will commence.

ABS Global is a public limited liability company issuing USD
floating-rate notes backed by trade finance loan receivables
originated by branches of Citibank, N.A. (Citibank, rated 'AA-'
(AA minus)/ 'F1+' with a Negative rating Outlook) in Hong Kong,
Singapore and Taiwan.


ACXIOM CORP: Posts $58.2 Million Net Loss in First Quarter 2008
---------------------------------------------------------------
Acxiom Corporation (Nasdaq: ACXM) reported its financial results
for the fourth quarter and fiscal year end ended March 31, 2008.
The company will host an investor day June 17 in New York. Details
will be made available on the Acxiom Web site.

Revenue for the fourth quarter was $349.8 million compared to
$356.4 million in the fourth quarter of fiscal 2007. Operating
loss for the quarter was $76.0 million and loss per diluted share
was $0.76. The results for the quarter include the impact of
$107.2 million of restructuring and other items (of which $104.5
million are included in the loss from operations, with the
remainder included in other expense), which contributed to the
loss by the equivalent of $0.91 per diluted share.

For the 12-month period ended March 31, 2008, revenue totaled
$1.384 billion compared to $1.391 billion in the prior year.
Income from operations for the 12 month period was $40.2 million
compared to $154.1 million a year ago. Loss per diluted share was
$0.10 compared to earnings per diluted share of $0.80 in the prior
year. The loss per diluted share includes the impact of $84.2
million, or the equivalent of $0.70 per diluted share, of expense
from unusual items.

For the first quarter of 2008, the company reported a net loss of
$58.2 million, compared with net income of $5.7 million in the
same period in 2007.  As of March 31, 2008, the company's total
stockholders' equity was $500.5 million.

According to John Meyer, Acxiom Corp. CEO and President, "During
my first 90 days I have focused on meeting our customers and our
people, rationalizing costs and gaining a deeper understanding of
our offerings and value propositions. I have also made a number of
leadership and role changes.

"We are working to develop strategic and operational plans to help
overcome the current challenges we are facing in some industry
sectors and to provide a springboard for growth in future years.
The initial focus will be on our customers and potential
customers, leveraging our capabilities and assets across all
industries we serve, and creating a winning market-facing culture.
We already have a very strong foundation to do that. I believe in
this opportunity now even more than when I was evaluating coming
on board."

            Restatement, Restructuring and Other Items

The Company is restating its financial statements for 2007, 2006,
and prior years to correct its accounting related to accrued
service revenue. The impact of this restatement will be a
reduction in net income of $2.4 million in 2006 and $2.9 million
in 2007. Accrued revenue, which is reflected in accounts
receivable, will be reduced by a total of $52.2 million.

Fourth-quarter loss per diluted share of $.76 includes $107.2
million or the equivalent of $0.91 per share in unusual expenses.

The major components of the restructuring and other items are:

   * Gains, losses and other - $74.5 million composed of:

     -- Restructuring charges - $42.9 million related to
        headcount reduction, real estate closure, contract
        termination;

     -- Closing operations - $13.5 million related to previously
        acquired operations and the flight department;

     -- Asset disposal/impairment - $15.0 million, primarily
        software;

     -- Other – $3.1 million related to legal, international and
        other;

   * IT contract restructuring - $34.0 million reflected as
     increase in cost of services;

   * Loss on investment - $2.7 million reflected in Other, net;

   * Accrued revenue restatement - $.4.0 million increase in
     revenue.

Of the $107.2 million in restructuring and other items,
approximately $59.2 million represents balance sheet assets
written down that do not require cash outlays. Approximately $48.0
million represents estimated cash payments to be made on
obligations primarily related to headcount reductions, real estate
and facilities lease terminations and an aircraft lease
termination. The $48 million includes obligations of approximately
$34 million to be paid in fiscal 2009, with the remainder in
future periods.

Details of Acxiom’s fourth-quarter results include:

   * Revenue of $349.8 million compared to $356.4 million in the
     fourth quarter a year ago;

   * Loss from operations of $76.0 million compared to income
     from operations of $28.4 million in the fourth quarter last
     year;

   * Loss from operations this quarter included $107.2 million of
     restructuring and other items;

   * Loss per diluted share of $0.76 compared to earnings per
     share of $0.07 in the fourth quarter of fiscal 2008;
     included in the loss per share of $0.76 is the negative
     impact of restructuring and other items which was the
     equivalent of $.91 per diluted share;

   * Operating cash flow of $90.5 million compared to
     $76.5 million in the fourth quarter a year ago;

   * Free cash flow available to equity of $14.7 million compared
     to $15.4 million a year ago; free cash flow available to
     equity is a non-GAAP financial measure.

Details of Acxiom’s fiscal year results include:

   * Revenue of $1.38 billion compared to $1.39 billion in the
     prior year;

   * Income from operations of $40.2 million in 2008 compared to
     $154.1 million in fiscal 2007;

   * Loss per diluted share of $0.10 compared to earnings per
     diluted share of $0.80 in fiscal 2007; net restructuring and
     other items for the year were $84.2 million, or the
     equivalent of $0.70 per diluted share; In addition to the
     restructuring and other items in the fourth quarter, the
     company had a benefit of a net gain of $22.9 million
     comprised of:

     -- Gains from a merger termination payment and sale of
        assets of $68.2 million;

     -- Restructuring costs, transaction costs, retirement and
        loss on sale of assets of $30.0 million;

     -- Additional contract impairment in cost of services of
        $10.0 million;

     -- Reduction in revenue related to accrued revenue
        restatement to previous quarters of $5.2 million;

   * Operating cash flow of $300.3 million compared to $260.0
     million in the prior year;

   * Free cash flow available to equity of $77.5 million compared
     to $55.2 million a year ago; free cash flow available to
     equity is a non-GAAP financial measure.

Segment information:

   * Information Services Division: The division develops, sells
     and delivers industry-tailored solutions globally through
     the integration of products, services and consulting.
     Revenue for the quarter was $189.7 million, up 0.8 percent
     from the fourth quarter of the previous year. For the 12
     months ended March 31, 2008, revenue was $741.3 million, up
     1.8 percent from the previous year. Operating income for the
     quarter was $24.1 million, down 7.7 percent from the third
     quarter of the previous year. For the 12 months just ended,
     operating income was $97.2 million, down 22.0 percent from
     the previous 12-month period.

   * Information Products Division: The division develops and
     sells all global data products, including InfoBase-X and
     PersonicX, as well as fraud and risk mitigation products
     sold in the U.S., including InsightIdentify. It focuses on
     product development, product lifecycle management, data
     content management and innovation. Revenue for the quarter
     was $115.2 million, up 5.2 percent from the fourth quarter
     of the previous year. For the 12 months ended March 31,
     2008, revenue was $431.3 million, up 3.8 percent from the
     previous year. Operating income for the quarter was $13.1
     million, up 45.9 percent from the fourth quarter of the
     previous year. For the 12 months just ended, operating
     income was $23.8 million, up 25.7 percent from the previous
     12-month period.

   * Infrastructure Management Division: The division develops
     and delivers information technology products and services
     that improve a company’s ability to manage its information
     technology delivery platform with lower costs and higher
     efficiencies. Such offerings include traditional IT
     outsourcing and transformational solutions such as the
     Acxiom data factory. Revenue for the quarter was $108.2
     million, down 8.8 percent from the fourth quarter of the
     previous year. For the 12 months ended March 31, 2008,
     revenue was $447.5 million, down 6.1 percent from the
     previous year. Operating income for the quarter was $8.3
     million, down 16.1 percent from the fourth quarter of the
     previous year. For the 12 months just ended, operating
     income was $44.3 million, down 10.3 percent from the
     previous 12-month period.

                           Investor Day

The company will be hosting an investor day on June 17 and
providing a forecast for fiscal 2009 at that time. Company
management will also discuss operations and prospects at the
investor day. The event will be held at the NASDAQ facilities in
New York and will be web cast. Further information will be made
available at http://www.acxiom.com/

                      Web Link to Financials

http://www.acxiom.com/FY08_Q4_Financialsis a link to the detailed  
financial information.

                    About Acxiom Corporation

Headquartered in Little Rock, Arkansas, Acxiom Corporation,
(Nasdaq: ACXM) -- http://www.acxiom.com/-- integrates data,  
services and technology to create and deliver customer and
information management solutions for many of the largest, most
respected companies in the world.  The core components of Acxiom's
innovative solutions are Customer Data Integration (CDI)
technology, data, database services, IT outsourcing, consulting
and analytics, and privacy leadership.  Founded in 1969, Acxiom
has locations throughout the United States and Europe, and in
Australia, China and Canada.

                          *     *     *

As reported in the Troubled Company Reporter on Dec. 17, 2007,
Moody's Investors Service confirmed Acxiom's Ba2 corporate family
rating and assigned a negative rating outlook, concluding a review
for possible downgrade initiated on May 17, 2007, following the
company's announcement that it had entered into a definitive
agreement to be acquired by Silver Lake and ValueAct Capital for
$3 billion.


AES CORP: Fitch Rates Senior Unsecured Notes 'BB/RR1'
-----------------------------------------------------
Fitch Ratings has assigned a 'BB/RR1' rating to AES Corporation's
(AES) $600 million issuance of senior unsecured notes maturing
2020. AES' long-term Issuer Default Rating (IDR) is rated 'B+'.
Fitch's rating is based on its expectation that AES will use the
proceeds to pay down higher-cost debt. The Rating Outlook is
Stable.

The ratings of AES reflect the large amount of parent-company
recourse debt, the structural subordination of that debt to
subsidiary debt, and the reliance on distributions from its
subsidiaries for parent company debt service. Offsetting, in part,
the company's financial risk is the solid base of cash flow from
utility businesses and contracted generation as well as the
diversity of cash flow sources. The current Stable Rating Outlook
reflects Fitch's expectation that credit metrics will stay within
parameters for the current rating.

Headquartered in Arlington, Virginia, AES Corporation --
http://www.aes.com/-- a global power company,  
operates in South America, Europe, Africa, Asia and the
Caribbean countries.  Generating 44,000 megawatts of electricity
through 124 power facilities, the company delivers electricity
through 15 distribution companies.  Its consolidated revenues
totaled $13.6 billion during fiscal year 2007.  

AES has been in Eastern Europe for over ten years, since it
acquired three power plants in Hungary in 1996.  Currently, AES
has two distribution companies in Ukraine, which serve 1.2
million customers and generation plants in the Czech Republic
and Hungary.  AES is also the leading company in biomass
conversion in Hungary, generating 37% of the nation's total
renewable generation in 2004.

AES started developing projects in India and Pakistan in 1992 and
entered China's market in 1994.  In 1996, AES joined with Chinese
partners to build Yangcheng, the country's first "coal by wire"
power plant, to help fuel China's rapid economic expansion through
affordable power.  In India, AES successfully participated in the
country's first and only generation privatization.

  
AES CORP: Moody's Puts B1 Rating on $600MM Senior Unsecured Notes
-----------------------------------------------------------------
Moody's Investors Service has assigned a B1 rating to The AES
Corporation's proposed issuance of $600 million senior unsecured
notes due 2020.  In addition, Moody's has affirmed the ratings of
AES, including the company's Corporate Family Rating at B1, its
Probability of Default Rating at B1, its senior secured credit
facilities at Ba1, its second priority senior secured notes at
Ba3, its senior unsecured notes at B1 and its trust preferred
securities at B3.  The rating outlook for AES is stable.

The rating affirmation reflects an expectation that AES will use
the proceeds from the proposed offering to refinance a similar
amount of recourse debt.  The rating affirmation also takes into
account the company's concurrent effort to eliminate the financial
covenants contained in its second priority senior secured notes.

AES's ratings consider the company's high leverage and the
structural subordination of its recourse debt to the significant
level of non-recourse debt in its consolidated capital structure.  
Structural constraints are somewhat mitigated by the
diversification provided by AES's large number of subsidiaries,
their wide geographic distribution and balanced fuel mix, and the
significant proportion of the company's cash flows that are
subject to stable regulation or long-term contracts.

Subsidiary distributions to AES are expected to be approximately
$1.1 billion in 2008, similar to 2007 results.  Recourse debt
however increased approximately 16% or $760 million to
$5.6 billion during 2007 as AES borrowed to finance growth.  This
increase in leverage constrains upward movement in AES's current
rating levels over the near-term.  The commercial operation of
various generating stations currently under construction that are
expected to achieve operation in the 2009/2010 timeframe is
expected to improve the scale of subsidiary distributions and
financial metrics and may be a trigger for upward ratings
pressure.

Ratings affirmed/LGD assessments revised:

The AES Corporation

  -- Corporate Family Rating -- B1
  -- Probability of Default Rating -- B1
  -- Senior secured credit facilities -- Ba1 (LGD1, 5%) from
     (LGD1, 2%)

  -- Second priority senior secured note -- Ba3 (LGD3, 41%) from
     (LGD3, 38%)

  -- Senior unsecured notes -- B1 (LGD4, 56%) from (LGD4, 53%)

AES Trust III

  -- Convertible trust preferred securities -- B3 (LGD6, 95%) from
     (LGD6, 94%)

Rating assigned:

The AES Corporation

  -- $600 million of new senior unsecured notes, B1 (LGD4, 56%)

The AES Corporation is a global power company with generation and
distribution assets in Europe, Asia, Latin America, Africa and the
United States.  Its consolidated revenues totaled $13.6 billion
during fiscal year 2007.


ALASKA AIR: Moody's Affirms All Ratings; Changes Outlook to Neg.
----------------------------------------------------------------
Moody's Investors Service affirmed all debt ratings of Alaska Air
Group and its primary subsidiary Alaska Airlines, Inc. --
corporate family rating of B1.  The outlook has been changed to
negative from stable.

The negative outlook reflects Moody's expectation that Alaska will
record a net loss and negative cash flow from operations in 2008
due to the impact of materially higher fuel costs and weakening
economic conditions which are likely to pressure yields.  Although
the company has fuel hedges that are meaningfully more beneficial
than competitors, Alaska will be challenged to generate positive
cash flow from operations if current fuel prices persist.

Of greatest concern to Moody's is a deteriorating earnings
environment for all airlines, including Alaska, primarily driven
by persistently elevated fuel costs.  Fuel now represents the
largest component of airline's cost structures and expectations
are that even if fuel costs moderate somewhat during the latter
part of the year, the significant losses incurred in the early
part of 2008 will not be offset.  Under these conditions, Alaska's
credit metrics are likely to worsen despite its actions to control
costs which include fuel reduction initiatives such as a new
flight planning system to effect more direct routings, single-
engine taxi procedures, the use of more ground power at airports,
and the installation of winglets which improve fuel efficiency.

While likely to weaken by cash use, Alaska's liquidity profile
remains adequate.  Alaska has a less stressful capital spending
plan this year because the majority of scheduled aircraft
deliveries are financed and Alaska expects to receive financing on
the remaining aircraft.  As well, following the completion of
fleet transition programs at Alaska Airlines and Horizon Air in
2008, capital spending is expected to decline materially in 2009.  
Alaska has modest near term debt maturities of approximately
$100 million annually through 2012.  Although Moody's expects
Alaska to use cash in its operations in 2008, Moody's believe
liquidity will be adequate due to the availability under an
undrawn revolving line of credit.  Moody's notes that Alaska
remains well in compliance with the financial covenants associated
with the revolver.

If Alaska is unable to implement offsetting actions to improve its
operating performance, such as further cost cutting initiatives,
fuel surcharges or fare increases, the ratings could be pressured
down.  Of particular concern to the rating would be any evidence
that sustained cash losses from operations were eroding the
company's liquidity profile ore posing any risk to future covenant
compliance under the bank facility.  Alternatively, the outlook
could be stabilized if fuel prices moderate and Alaska is able to
resume profitable operations and improve its cash flow metrics.

Outlook Actions:

Issuer: Alaska Air Group, Inc.

  -- Outlook, Changed To Negative From Stable

Issuer: Alaska Airlines Inc.

  -- Outlook, Changed To Negative From Stable

Alaska Air Group, headquartered in Seattle, Washington, is a
holding company for two U.S. passenger airlines, Alaska Airlines
Inc. and Horizon Air Industries, Inc.


AMERICAN AXLE: UAW Talks Stall Over Health & Unemployment Benefits
------------------------------------------------------------------
The strike called by the International United Auto Workers union
at American Axle & Mnufacturing Holdings Inc.'s original U.S.
locations continues into its 81th day.  Approximately 3,650
associates are represented by the International UAW at these five
facilities in Michigan and New York.

AAM and the International UAW bargained over the past weekend and
made progress on numerous issues.  There are very few remaining
issues separating the parties from reaching agreement.

Negotiations have stalled since late Sunday over two issues:
healthcare benefits for actively employed associates and
Supplemental Unemployment Benefits.

With respect to active healthcare benefits, the International UAW
would like to continue a comprehensive plan design that would cost
AAM approximately double the rate of its principal UAW-represented
competitor suppliers in the U.S.

SUB is a benefit not typically offered by automotive suppliers.
SUB consists of both direct wage payments and benefit continuation
for associates not working due to layoff.  None of AAM's principal
UAW-represented competitor suppliers have SUB in their labor
agreements negotiated with the International UAW.

SUB is a contract provision that is driving work out of AAM's
original U.S. locations.  Paying associates who are not working is
an uncompetitive burden that AAM cannot bear if it is to compete
successfully in the U.S. market and earn new or replacement
business.

Both of these benefit programs are major cost drivers that must be
addressed in order for AAM to attain a U.S. market competitive
labor agreement for the original U.S. locations.

AAM is not -- and never has been -- an original equipment
manufaturer, the company has indicated.  AAM is a Tier 1, Tier 2
and Tier 3 supplier to the automotive industry.  In addition to
SUB, the International UAW is requesting many other OEM-style
contract provisions for the original U.S. locations.  These
include a $5,000 signing bonus, buy-out incentives up to $140,000
per associate and buydowns that are comparable to agreements
previously reached at Delphi and Magna New Process Gear.

AAM desires to keep work in the original U.S. locations.  AAM is
prepared to invest up to $200 million in these facilities to
support future product program sourcing if a U.S. market
competitive labor agreement is attained with the International
UAW.

The recent and rapidly accelerating deterioration in the domestic
light truck market is having a most severe negative impact on
AAM's U.S. operations.  While this is unfortunate, it is a market
reality that AAM and the International UAW must jointly address.  
AAM stands ready to continue negotiating with the International
UAW to reach an agreement that ends this terribly costly and
disruptive strike so that the original U.S. locations can begin
earning new and replacement business to sustain future operations.  

Headquartered in Detroit, Michigan, American Axle & Manufacturing
Holdings Inc. (NYSE:AXL) -- http://www.aam.com/-- and its
wholly owned subsidiary, American Axle & Manufacturing, Inc.,
manufactures, engineers, designs and validates driveline and
drivetrain systems and related components and modules, chassis
systems and metal-formed products for light trucks, sport utility
vehicles and passenger cars.  In addition to locations in the
United States (in Michigan, New York and Ohio), the company also
has offices or facilities in Brazil, China, Germany, India, Japan,
Luxembourg, Mexico, Poland, South Korea and the United Kingdom.

                            *     *     *

As reported in the Troubled Company Reporter on April 4, 2008,
Moody's Investors Service placed American Axle & Manufacturing
Holdings, Inc.'s Ba3 Corporate Family Rating under review for
downgrade.


AMERICAN HOME TRUST: S&P's Affirms 'B' Rating on Class M-5 Notes
----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its ratings on six
classes of mortgage-backed notes issued by American Home Mortgage
Assets Trust 2007-SD2.
     
As of the April 2008 remittance period, total delinquencies were
87.72% of the current pool balance, while severe delinquencies
were 82.22%.  These levels are down slightly from the March 2008
remittance period, when total delinquencies were 88.13% of the
current pool balance and severe delinquencies were 83.41%.  
Through the April 2008 remittance period, cumulative realized
losses totaled 6.49% of the original pool balance.
     
Despite the level of the delinquency pipeline and the realized
losses this transaction has experienced, which S&P believe are
consistent with the characteristics of the collateral, S&P  
affirmed its ratings on the six outstanding classes because its
analysis indicates that they have adequate credit support
percentages for their current ratings.
     
This deal has a current outstanding pool factor of 79.58% and is
11 months seasoned.  Subordination provides credit support for
this deal.  The pool originally consisted of fixed- and
adjustable-rate mortgage loans, a substantial portion of which are
in bankruptcy, or foreclosure proceedings, or are otherwise
nonperforming.  The mortgage loans are secured by first or second
liens on one- to four-family residential properties, planned unit
developments, condominiums, and manufactured housing.
   

                          Ratings Affirmed

            American Home Mortgage Assets Trust 2007-SD2
                Mortgage-backed notes series 2007-SD2

                    Class                  Rating
                    -----                  ------
                    A                      AAA
                    M-1                    AA
                    M-2                    A
                    M-3                    BBB
                    M-4                    BB
                    M-5                    B


AMERICAN HOME TRUST: S&P Slashes Rating to 'D' on Cl. II-M-1 Trust
------------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on classes
II-A and II-M-1 from American Home Mortgage Investment Trust
2007-A.  S&P downgraded class II-A to 'CCC' from 'AAA' and
downgraded class II-M-1 to 'D' from 'AA'.
     
The downgrades reflect the deteriorating performance of the
collateral pool as monthly net losses continue to significantly
outpace monthly excess interest cash flows, resulting in the
complete write-down of the overcollateralization for loan group
II.  The other subordinate classes from this loan group (classes
II-M-2, II-M-3, II-M-4, II-M-5, and II-M-6) have already
experienced complete write-downs to their principal balances.  
During the March 2008 remittance period, the loan group
experienced a $6,810,484 realized loss, which resulted in the
complete write-down to the principal balances of classes II-M-2,
II-M-3, II-M-4, II-M-5, and II-M-6.  As a result, Standard &
Poor's withdrew its ratings on these classes on May 13, 2008.  

In addition, class II-M-1 experienced a partial write-down to its
principal balance, which caused the class to default.  
Consequently, S&P have lowered the rating on this class to 'D'.  
As of the April 2008 remittance period, cumulative losses for loan
group II, as a percentage of the original pool balance, totaled
21.86%.  Total delinquencies (30-plus days, foreclosures, and
REOs) for the loan group II total 21.26%.
     
Subordination and excess spread provide credit support for the
affected loan group.  The collateral for this loan group primarily
consists of closed-end second-lien, adjustable- and fixed-rate
mortgage loans secured by one- to four-family residential
properties.


                          Ratings Lowered

           American Home Mortgage Investment Trust 2007-A

                                    Rating
                                    ------
                   Class        To          From
                   -----        --          ----
                   II-A         CCC         AAA
                   II-M-1       D           AA


AMP'D MOBILE: Files $90,982 Preference Suit Against LetsTalk.Com
----------------------------------------------------------------
Amp'd Mobile, Inc., filed a complaint against LetsTalk.Com, Inc.,
before the United States Bankruptcy Court in the District of
Delaware, seeking to recover money with respect to certain
transfers.  The Debtor also seeks to avoid those Transfers.

The Debtor relates that it transacted business with LetsTalk.Com,
Inc. prior to the Petition Date.  It caused the transfer of
certain amounts, totaling $90,982, from a bank account owned by
the Debtor to LetsTalk.Com.  Accordingly, the Transfer was a
transfer of an interest of the Debtor in property, Steven M.
Yoder, Esq., at Potter Anderson & Corroon LLP, in Wilmington
Delaware, points out.  

He adds that the Transfer was made to or for the benefit of
LetsTalk.com.  Also, LetsTalk.com's claim against the Debtor for
which the Transfer was made was an antecedent debt.

Mr. Yoder also cites that the Transfer was made on or within 90
days before the Petition Date, of which during that time, the
Debtor was insolvent, as that term is defined in Section 101(32)
of the Bankruptcy Code.  The Debtor's debts exceeded the value of
all of its property, he avers.  

Mr. Yoder adds that the Transfer enabled LetsTalk.com to receive
more than it would receive if:

   (a) the Debtor's case was a case under Chapter 7 of the
       Bankruptcy Code;

   (b) the transfer had not been made; and

   (c) the Transferee received payment of its debt to the extent
       provided by the Bankruptcy Court.

Mr. Yoder informs the Court that on December 18, 2007, the
Debtor, by their counsel, made written demand on LetsTalk.com for
the return of the Transfer.  LetsTalk.com, however, has failed or
refused to return the Transfer.  

Mr. Yoder argues that the Transfers are avoidable under Section
547(b) of the Bankruptcy Code and that the property is
recoverable from the Transferee pursuant to Section 550 of the
Bankruptcy Code.

Accordingly, the Debtor ask the Court to:

   (a) avoid, and allow it, to recover the Transfers;

   (b) to the extent LetsTalk.com holds a claim against the
       Debtor or its bankruptcy estate, disallow that claim
       pursuant to Section 502(d);

   (c) grant it an award of pre-judgment interest on the value of
       the Transfer from the date of its demand letter until the
       entry of judgment;

   (d) award to it costs and disbursement of expenses it incurred
       in relation to the Adversary Proceeding.

                        About Amp'd Mobile

Headquartered in Los Angeles, California, Amp'd Mobile Inc. aka
Amp'D Mobile LLC -- http://www.ampd.com/-- is a mobile virtual  
network operator that provides voice, text and entertainment
content to subscribers who contract for cellular telephone
service. The company filed for chapter 11 protection on June 1,
2007 (Bankr. D. Del. Case No. 07-10739). Steven M. Yoder, Esq.,
Eric M. Sutty, Esq. and Mary E. Augustine, Esq. at The Bayard
Firm, represent the Debtor in its restructuring efforts.  
Attorneys at Otterbourg, Steindler, Houston & Rosen, P.C. and
Klehr, Harrison, Harvey, Branzburg & Ellers, LLP, represent the
Official Committee of Unsecured Creditors.  In its schedules filed
with the Court, the Debtor listed total assets of $47,603,629 and
total debts of $164, 569,842.  The Debtor's exclusive period to
file a plan expired on Sept. 29, 2007.  The Debtor is in the
process of selling various assets. (Amp'd Mobile Bankruptcy News,
Issue No. 25; Bankruptcy Creditors' Services Inc.
http://bankrupt.com/newsstand/or 215/945-7000).


AMP'D MOBILE: Inks Stipulation Rejecting Westside Medical Lease
---------------------------------------------------------------
Amp'd Mobile, Inc., and Westside Medical Park LLC, as landlord,
were parties to a certain lease agreement dated March 5, 2007,
wherein the Debtor leased office and warehouse space consisting
of:

   -- approximately 70,000 rentable square feet of office space
      located at 1933 and 1925 S. Bundy Drive, in Los Angeles,
      California; and

   -- a portion of approximately 15,000 square feet of space at
      1901 S. Bundy Drive, in Los Angeles, California.

In a stipulation approved by the U.S. Bankruptcy Court for the
District of Delaware, the parties agreed that:

   (1) The Lease is rejected effective September 30, 2007.

   (2) Any right to possession of the Premises by or through the
       Debtor, the estate, or anyone claiming any interest in
       the Premises, is terminated and forfeited under applicable
       non-bankruptcy law as of September 30, 2007.

   (3) The Debtor, the estate, and any person or entity claiming
       a right to possession under or through the Debtor or
       otherwise, will immediately quit and deliver possession of
       the Premises to the Landlord or its authorized agent.

   (4) The Premises will immediately be delivered to the Landlord
       and any personal property and furniture, fixtures, and
       equipment remaining in or on the Premises after
       September 30, 2007 is deemed abandoned to the Landlord
       pursuant to Section 554 of the Bankruptcy Code and the
       Landlord will have limited relief from the automatic stay
       imposed by Section 362 solely for the purpose of disposing
       any of the Debtor's personal property remaining in or on
       the Premises after September 30, 2007, as well as any
       interior or exterior signage without any liability to the
       Debtor for violation of the automatic stay.  

       The stay relief will permit the Landlord to serve any
       notice on the Debtor as is required by the law of the
       State of California prior to disposing of any of the
       Debtor's personal property remaining in or on the
       Premises.

   (5) The Landlord will also have relief from the automatic stay
       to set off under Section 553, or otherwise recoup, and
       apply, the Security Deposit of $259,000 against the
       general unsecured portion of any claim that it files in
       the Debtor's bankruptcy case.  Provided however, that
       before recouping or applying the Security Deposit, the
       Landlord will provide the Debtor, the Secured Lender and
       the Official Committee of Unsecured Creditors written
       notice of the intended application, and the Debtor,
       Secured Lender and Committee will have 10 days to object
       in writing to that application.  If any objection is not
       resolved, the parties may seek a resolution of the
       objection from the Court.

   (6) Modification of the automatic stay permits the Landlord to
       issue, file, serve, or record any and all notices as may
       be desirable or necessary under applicable non-bankruptcy
       law in conjunction with the exercise of its rights and
       remedies to recover possession of the Premises, terminate
       the Lease, and to dispose of any personal property
       remaining on the Premises without any liability whatsoever
       to the Debtor or any third party.  The Landlord does not
       have relief from the automatic stay to seek and recover
       any monetary amounts from the Debtor for any reason or to
       pursue any action against the Debtor based on mechanic's
       liens or other liens asserted on the Premises.

   (7) The Landlord will have an allowed $137,410 administrative
       claim under Section 365(d)(3) and Section 503(b)(1) for
       June 2007 rent and related charges, which will be paid
       pari passu with the payment of all other administrative
       claims in the Debtor's bankruptcy proceeding pursuant to a
       confirmed plan of liquidation without further need of the
       Landlord to file an additional administrative expense
       claim or demand for administrative expense payment.

                        About Amp'd Mobile

Headquartered in Los Angeles, California, Amp'd Mobile Inc. aka
Amp'D Mobile LLC -- http://www.ampd.com/-- is a mobile virtual  
network operator that provides voice, text and entertainment
content to subscribers who contract for cellular telephone
service. The company filed for chapter 11 protection on June 1,
2007 (Bankr. D. Del. Case No. 07-10739). Steven M. Yoder, Esq.,
Eric M. Sutty, Esq. and Mary E. Augustine, Esq. at The Bayard
Firm, represent the Debtor in its restructuring efforts.  
Attorneys at Otterbourg, Steindler, Houston & Rosen, P.C. and
Klehr, Harrison, Harvey, Branzburg & Ellers, LLP, represent the
Official Committee of Unsecured Creditors.  In its schedules filed
with the Court, the Debtor listed total assets of $47,603,629 and
total debts of $164, 569,842.  The Debtor's exclusive period to
file a plan expired on Sept. 29, 2007.  The Debtor is in the
process of selling various assets. (Amp'd Mobile Bankruptcy News,
Issue No. 25; Bankruptcy Creditors' Services Inc.
http://bankrupt.com/newsstand/or 215/945-7000).


AMPEX CORP: Judge Sees Appointment of Equity Holders Panel as Moot
------------------------------------------------------------------
The Hon. Arthur Gonzalez of the U.S. Bankruptcy Court for the
Southern District of New York denied a request to immediately
appoint an Official Committee of Equity Holders filed by ValueVest
High Concentration Master Fund Ltd., equity security holder and
party-in-interest of Ampex Corporation and its debtor-affiliates,
Tiffany Kary of Bloomberg News reports.

Ms. Kary quotes Judge Gonzalez as saying that the company is
insolvent and shareholders are not going to get any distribution
in this bankruptcy case.  Judge Gonzalez is convinced that the
company can no longer pay equity holders, she notes.

As reported in the Troubled Company Reporter on May 5, 2008,
ValueVest said the Committee is expected to represent and
prosecute the interest of shareholders and recover certain of
their equity stake in the Debtors.

ValueVest argued that the Debtors are not insolvent and there
is a substantial likelihood of a meaningful distribution to
equity.  The Debtors have at least 393 shareholders with Class A
common stock outstanding as of March 25, 2008, wherein ValueVest
holds 13.4% shares of the Debtors' Class A common stock.

                     About Ampex Corporation

Headquartered in Redwood City, California, Ampex Corporation --
http://www.ampex.com-- designs and manufactures data storage       
products used in defense application to gather images and other
date from aircrafts, satellites and submarines.

The company and six of its affiliates filed for Chapter 11
protection on March 30, 2008 (Bankr. S.D.N.Y. Lead Case No.08-
11094).  Matthew Allen Feldman, Esq., and Rachel C. Strickland,
Esq., at Willkie Farr & Gallagher LLP, represent the Debtors in
their restructuring efforts.  The Debtors selected Epiq Systems
Bankruptcy Solution as claims, noticing and balloting agent.  The
U.S. Trustee for Region 2 appointed five creditors to serve on an
Official Committee of Unsecured Creditors.

When the Debtors filed for protection against their creditors,
they listed total assets of $26,467,000 and total debts of
$133,602,000.  As of Dec. 31, 2007, Ampex reported a balance sheet
data with total assets of $26.46 million, total liabilities of
$133.60 million resulting to a total stockholders' deficit of
$107.13 million.


ASCALADE COMM: Hong Kong Court OKs ACL's Scheme of Arrangement
--------------------------------------------------------------
Ascalade Communications Inc. disclosed that the High Court of Hong
Kong sanctioned the Scheme of Arrangement filed by Ascalade
Communications Limited under Section 166 of the Companies
Ordinance (Chapter 32) of Hong Kong, in connection with the on-
going legal proceedings filed by Ascalade and Ascalade
Technologies Inc. in Canada under the Companies' Creditors
Arrangement Act.

Ascalade Communications Limited is an indirect subsidiary of the
company and is a major operating company in the Ascalade group of
companies.
    
The Scheme of Arrangement was approved at a meeting of the
creditors of ACL held on May 2, 2008.  As an outcome of the court
sanctioning the Scheme, Deloitte & Touche Hong Kong have been
appointed Scheme Administrators and will oversee management in the
orderly wind-up of ACL and sale of the assets located in the
Peoples Republic of China.

In the Scheme, the Administrator has estimated that proven ACL
creditors will potentially receive a dividend of $0.37 for each
dollar filed in a claim, there are certain qualifications and
warnings which are associated with this realization; as ACL
has not yet realized upon its assets and all creditors' claims
have not yet been adjudicated.  It should be noted that the
companies have filed claims against ACL in the Scheme.
    
Subsequent to the sanctioning of the Scheme by the Hong Kong High
Court, the company will commence formal marketing of the
significant assets located in the PRC, namely the factory,
machinery and equipment and raw material inventory.  Progress in
these marketing efforts will be the subject of future updates.
    
Any recovery in the CCAA for creditors and other stakeholders of
the companies, including shareholders, is uncertain and is highly
dependent upon a number of factors, including the recovery from
the sale of the factory, equipment and inventory in the PRC and
the outcome of the Scheme in Hong Kong.
    
In addition, Ascalade is providing this update in accordance with
Ontario Securities Commission Policy 57-603 Defaults by Reporting
Issuers in Complying with Financial Statement Filing Requirements.

In accordance with the OSC Policy, the company confirms that,
except as disclosed in press statements dated April 2, 2008,
April 9, 2008, and April 29, 2008, issued by the company since its
initial default statement dated March 31, 2008:

   (i) there is no material change to the information set out in
       its initial default statement filed pursuant to the OSC
       Policy;

  (ii) there has been no failure by the company to adhere to the
       Alternative Information Guidelines set out in the OSC
       Policy with respect to the financial statement filing
       default; and

(iii) there is no other material information concerning the
       affairs of the company that has not been generally
       disclosed.

                About Ascalade Communications Inc.

Based in Richmond, British Columbia, Ascalade Communications Inc.
(TSE:ACG) -- http://www.ascalade.com/ -- is an innovative product    
company that designs, develops and manufactures digital wireless
and communication products.  The company deliver products by
offering its partners and customers complete vertical integration,
from product design and development to final production.  The
company's products include digital cordless phones, Voice over
Internet Protocol phones, digital wireless baby monitors and
digital wireless conference phones. Ascalade products have been
distributed in more than 35 countries and under 80 regional
brands.  Ascalade also has facilities in Qingyuan, China, Hong
Kong and a sales office in Hertfordshire, United Kingdom.

On April 29, 2008, Jervis Rodrigues, senior vice-president of
Deloitte & Touche Inc., filed separate petitions for protection
under Chapter 15 of the U.S. Bankruptcy Code on behalf of Ascalade
Communications Inc. and its debtor-affiliate (Bankr. N.D. Ill.
Case Nos. 08-10612 and 08-10616).  Jeffrey G. Close, Esq. at
Chapman and Cutler LLP represents the Petitioner in the Chapter 15
case.  Ascalade's financial condition as of September 2007 showed
total assets of $99,630,000 and total debts of $40,410,000.


ATHERTON & JENNINGS: Case Summary & Three Largest Unsec. Creditors
------------------------------------------------------------------
Debtor: Atherton & Jennings 120, LLC
        129 West Third St.
        Tulsa, OK 74103

Bankruptcy Case No.: 08-11031

Chapter 11 Petition Date: May 5, 2008

Court: Northern District of Oklahoma (Tulsa)

Judge: Terrence L. Michael

Debtor's Counsel: Scott P. Kirtley, Esq.
                  Email: skirtleyattorney@riggsabney.com
                  Riggs, Abney, Neal, Turpen, Orbison
                  502 West 6th St.
                  Tulsa, OK 74119-1016
                  Tel: (918) 587-3161
                  http://www.riggsabney.com/

Total Assets: $1,600,751

Total Debts:  $1,545,077

Debtor's Three Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
Internal Revenue Service       penalty for unfiled   $2,089
Ogden, UT 84201-0038           return

Downtown Tulsa Unlimited       fees                  $1,132
321 S. Boston
Tulsa, OK 74103

American Electric Power        utilities             $488
P.O. Box 24421
Canton, OH 44701-4421


BEAR STEARNS ABS: Fitch Rates 57 Classes Below Investment Grade
---------------------------------------------------------------
Fitch Ratings has taken these rating actions on Bear Stearns Asset
Backed Securities mortgage pass-through certificates. Unless
stated otherwise, any bonds that were previously placed on Rating
Watch Negative are now removed. Affirmations total $2.2 billion
and downgrades total $691.9 million. Additionally, $179.5 million
was placed on Rating Watch Negative.

BSABS Trust 2002-2
   -- $22.7 million class A-1 affirmed at 'AAA';
   -- $3.0 million class A-2 affirmed at 'AAA';
   -- $3.7 million class M-1 affirmed at 'AA+';
   -- $3.3 million class M-2 affirmed at 'A+';
   -- $3.9 million class B affirmed at 'BBB';

BSABS Trust 2003-1
   -- $54.3 million class A-1 affirmed at 'AAA';
   -- $7.1 million class A-2 affirmed at 'AAA';
   -- $9.0 million class M-1 affirmed at 'AA';
   -- $8.6 million class M-2 affirmed at 'A';
   -- $6.6 million class B affirmed at 'BBB';

BSABS Trust 2003-2 TOTAL
   -- $24.7 million class A-1 affirmed at 'AAA';
   -- $15.5 million class A-2 affirmed at 'AAA';
   -- $28.6 million class A-3 affirmed at 'AAA';
   -- $10.2 million class M-1 affirmed at 'AA';
   -- $9.1 million class M-2 downgraded to 'BBB+' from 'A';
   -- $8.2 million class B downgraded to 'BB' from 'BBB';

BSABS Trust 2003-3
   -- $39.6 million class A-2 affirmed at 'AAA';
   -- $7.8 million class M-1 affirmed at 'AA';
   -- $7.1 million class M-2 affirmed at 'A';
   -- $4.5 million class B affirmed at 'BBB';

BSABS Trust 2003-SD1
   -- $45.1 million class A affirmed at 'AAA';
   -- $4.7 million class M-1 affirmed at 'AA';
   -- $4.2 million class M-2 affirmed at 'A';
   -- $3.0 million class B affirmed at 'BBB';

BSABS Trust 2003-SD2 TOTAL
   -- $4.7 million class I-A affirmed at 'AAA';
   -- $11.8 million class II-A affirmed at 'AAA';
   -- $6.2 million class III-A affirmed at 'AAA';
   -- $3.6 million class B-1 affirmed at 'AA';
   -- $3.0 million class B-2 affirmed at 'A';
   -- $2.4 million class B-3 affirmed at 'BBB';

BSABS Trust 2003-SD3
   -- $44.0 million class A affirmed at 'AAA';
   -- $5.3 million class M-1 affirmed at 'AA';
   -- $4.5 million class M-2 affirmed at 'A';
   -- $3.6 million class B affirmed at 'BBB';

BSABS Trust 2004-1
   -- $22.9 million class A-2 affirmed at 'AAA';
   -- $17.7 million class M-1 affirmed at 'AA';
   -- $5.5 million class M-2 affirmed at 'AA';
   -- $2.2 million class M-3 affirmed at 'A';
   -- $0.1 million class B-1 affirmed at 'BBB+';
   -- $2.3 million class B-2 rated 'BBB-', placed on Rating Watch
      Negative;

Bear Stearns Asset Backed Securities Trust 2004-2
   -- $10.4 million class A-1 affirmed at 'AAA';
   -- $19.7 million class A-3 affirmed at 'AAA';
   -- $11.5 million class A-5 affirmed at 'AAA';
   -- $11.3 million class M-1 affirmed at 'AA+';
   -- $13.7 million class M-2 affirmed at 'BBB+';
   -- $4.6 million class M-3 downgraded to 'B' from 'BB';
   -- $1.2 million class B downgraded to 'CCC/DR2' from 'B';

BSABS Trust 2004-SD2
   -- $4.4 million class I-A affirmed at 'AAA';
   -- $4.0 million class II-A affirmed at 'AAA';
   -- $10.2 million class III-A affirmed at 'AAA';
   -- $11.1 million class IV-A affirmed at 'AAA';
   -- $4.7 million class B-1 affirmed at 'AA';
   -- $3.9 million class B-2 affirmed at 'A';
   -- $3.3 million class B-3 affirmed at 'BBB';
   -- $2.6 million class B-4 affirmed at 'BB-';
   -- $1.8 million class B-5 affirmed at 'B';

Bear Stearns Asset Backed Securities Trust 2005-1
   -- $4.6 million class A affirmed at 'AAA';
   -- $37.7 million class M1 affirmed at 'AA';
   -- $18.5 million class M2 downgraded to 'BB-' from 'BBB-';
   -- $4.3 million class M3 downgraded to 'B+' from 'BB';
   -- $3.9 million class M4 downgraded to 'B+' from 'BB-';
   -- $3.0 million class M5 affirmed at 'B';
   -- $4.5 million class M6 downgraded to 'C/DR5' from 'CC';
   -- $7.4 million class M7 downgraded to 'C/DR6' from 'CC';

Bear Stearns Asset Backed Securities Trust 2005-2
   -- $7.2 million class A-2 affirmed at 'AAA';
   -- $24.1 million class A-3 affirmed at 'AAA';
   -- $34.0 million class M-1 affirmed at 'AA';
   -- $17.7 million class M-2 affirmed at 'A';
   -- $3.9 million class M-3 affirmed at 'BBB+';
   -- $5.8 million class M-4 affirmed at 'BBB-';
   -- $3.2 million class M-5 downgraded to 'BB' from 'BBB-';
   -- $4.6 million class M-6 downgraded to 'B+' from 'BB';
   -- $10.2 million class M-7 downgraded to 'C/DR5' from 'C';

Bear Stearns Asset Backed Securities Trust 2005-3
   -- $40.5 million class A-1 affirmed at 'AAA';
   -- $23.6 million class A-3 affirmed at 'AAA';
   -- $26.1 million class M-1 affirmed at 'AA';
   -- $14.8 million class M-2 downgraded to 'BBB' from 'A';
   -- $3.4 million class M-3 downgraded to 'BBB-' from 'A-';
   -- $3.0 million class M-4 downgraded to 'BB' from 'BBB+';
   -- $3.4 million class M-5 downgraded to 'BB' from 'BBB';
   -- $2.9 million class M-6 downgraded to 'BB-' from 'BBB-';
   -- $5.3 million class M-7 downgraded to 'B+' from 'BB';

Bear Stearns Asset Backed Securities Trust 2005-SD1 Group 1
   -- $0.0 million class I-A-1 affirmed at 'AAA';
   -- $36.0 million class I-A-2 affirmed at 'AAA';
   -- $53.7 million class I-A-3 rated 'AAA', placed on Rating
      Watch Negative;
   -- $7.6 million class I-M-1 affirmed at 'AA';
   -- $3.8 million class I-M-2 affirmed at 'A';
   -- $2.3 million class I-M-3 downgraded to 'BBB+' from 'A-';
   -- $2.3 million class I-M-4 downgraded to 'BBB' from 'BBB+';
   -- $2.3 million class I-M-5 downgraded to 'BB' from 'BBB';
   -- $2.3 million class I-M-6 downgraded to 'BB-' from 'BBB-';
   -- $2.3 million class I-B downgraded to 'B' from 'BB';

Bear Stearns Asset Backed Securities Trust 2005-SD1 Group 2
   -- $25.3 million class II-A affirmed at 'AAA';
   -- $5.9 million class II-M-1 affirmed at 'AA';
   -- $3.7 million class II-M-2 affirmed at 'A';
   -- $2.5 million class II-M-3 affirmed at 'BBB';
   -- $2.0 million class II-B affirmed at 'BBB-';

Bear Stearns Asset Backed Securities, Inc. 2005-SD2 ARM Loans
   -- $38.1 million class II-A-1 affirmed at 'AAA';
   -- $4.3 million class II-A-2 affirmed at 'AAA';
   -- $11.5 million class II-M-1 affirmed at 'AA';
   -- $5.9 million class II-M-2 downgraded to 'BBB' from 'A';
   -- $5.7 million class II-M-3 downgraded to 'BB' from 'BBB';
   -- $1.1 million class II-B downgraded to 'BB-' from 'BBB-';

Bear Stearns Asset Backed Securities, Inc. 2005-SD2 FRM Loans
   -- $3.7 million class I-A-1 affirmed at 'AAA';
   -- $20.8 million class I-A-2 affirmed at 'AAA';
   -- $61.1 million class I-A-3 affirmed at 'AAA';
   -- $10.2 million class I-M-1 affirmed at 'AA';
   -- $3.4 million class I-M-2 affirmed at 'A';
   -- $2.0 million class I-M-3 affirmed at 'A-';
   -- $2.0 million class I-M-4 downgraded to 'BBB' from 'BBB+';
   -- $2.0 million class I-M-5 downgraded to 'BB' from 'BBB';
   -- $1.0 million class I-M-6 downgraded to 'BB-' from 'BBB-';
   -- $2.9 million class I-B downgraded to 'B+' from 'BB';

Bear Stearns Asset Backed Securities 2005-SD3 I LLC Group 1
   -- $120.4 million class I-A rated 'AAA', placed on Rating
      Watch Negative;
   -- $12.9 million class I-M-1 downgraded to 'A' from 'AA';
   -- $6.6 million class I-M-2 downgraded to 'BBB' from 'A';
   -- $1.8 million class I-M-3 downgraded to 'BBB-' from 'A-';
   -- $1.4 million class I-M-4 downgraded to 'BB+' from 'BBB+';
   -- $1.2 million class I-M-5 downgraded to 'BB' from 'BBB';
   -- $1.2 million class I-M-6 downgraded to 'BB-' from 'BBB-';

Bear Stearns Asset Backed Securities 2005-SD3 I LLC Group 2
   -- $29.7 million class II-A-1 affirmed at 'AAA';
   -- $3.3 million class II-A-2 affirmed at 'AAA';
   -- $7.8 million class II-M-1 affirmed at 'AA';
   -- $3.7 million class II-M-2 affirmed at 'A';
   -- $2.5 million class II-M-3 affirmed at 'BBB';
   -- $0.6 million class II-M-4 affirmed at 'BBB-';
   -- $1.5 million class II-B affirmed at 'BB';

Bear Stearns Asset Backed Securities 2005-SD4 Group I - FRMs
   -- $87.4 million class I-A-1 downgraded to 'AA' from 'AAA';
   -- $36.2 million class I-A-2 downgraded to 'AA' from 'AAA';
   -- $7.6 million class I-PO downgraded to 'AA' from 'AAA';
   -- $0.0 million class I-X affirmed at 'AAA';
   -- $9.0 million class I-B-1 downgraded to 'BBB+' from 'AA';
   -- $3.5 million class I-B-2 downgraded to 'BBB-' from 'A';
   -- $2.0 million class I-B-3 downgraded to 'BB' from 'BBB';
   -- $1.9 million class I-B-4 downgraded to 'B' from 'BB';
   -- $1.1 million class I-B-5 downgraded to 'C/DR6' from 'B';

Bear Stearns Asset Backed Securities 2005-SD4 Group II - ARMs
   -- $55.8 million class II-A-1 affirmed at 'AAA';
   -- $6.2 million class II-A-2 affirmed at 'AAA';
   -- $11.5 million class II-M-1 affirmed at 'AA';
   -- $5.1 million class II-M-2 downgraded to 'BBB-' from 'A';
   -- $2.5 million class II-M-3 downgraded to 'BB' from 'BBB';
   -- $0.9 million class II-M-4 downgraded to 'BB-' from 'BBB-';

Bear Stearns Asset Backed Securities Trust 2006-SD1
   -- $200.4 million class A affirmed at 'AAA';
   -- $16.5 million class M-1 affirmed at 'AA';
   -- $8.9 million class M-2 downgraded to 'BBB' from 'A';
   -- $4.7 million class M-3 downgraded to 'BB' from 'BBB';
   -- $1.8 million class M-4 downgraded to 'BB-' from 'BBB-';

Bear Stearns Asset Backed Securities Trust 2006-SD2 Aggregate
   -- $64.3 million class A-1 affirmed at 'AAA';
   -- $70.6 million class A-2 affirmed at 'AAA';
   -- $56.8 million class A-3 affirmed at 'AAA';
   -- $16.4 million class M-1 affirmed at 'AA';
   -- $8.3 million class M-2 affirmed at 'A';
   -- $5.7 million class M-3 downgraded to 'BB' from 'BBB';
   -- $1.1 million class M-4 downgraded to 'BB-' from 'BBB-';

Bear Stearns Asset Backed Securities Trust 2006-SD3 ARM
   -- $26.2 million class II-1A-1 downgraded to 'A' from 'AAA';
   -- $6.2 million class II-1A-2 downgraded to 'A' from 'AAA';
   -- $23.8 million class II-2A-1 downgraded to 'A' from 'AAA';
   -- $5.6 million class II-2A-2 downgraded to 'A' from 'AAA';
   -- $27.9 million class II-3A-1 downgraded to 'A' from 'AAA';
   -- $7.0 million class II-3A-2 downgraded to 'A' from 'AAA';
   -- $0.0 million class II-X-1 affirmed at 'AAA';
   -- $0.0 million class II-X-2 affirmed at 'AAA';
   -- $10.5 million class II-B-1 downgraded to 'BBB+' from 'AA';
   -- $5.3 million class II-B-2 downgraded to 'BBB-' from 'A';
   -- $2.9 million class II-B-3 downgraded to 'BB' from 'BBB';
   -- $1.9 million class II-B-4 downgraded to 'B' from 'BB';
   -- $1.5 million class II-B-5 downgraded to 'C/DR6' from 'B';

Bear Stearns Asset Backed Securities Trust 2006-SD3 FRM
   -- $39.1 million class I-A-1A downgraded to 'A-' from 'AAA';
   -- $3.3 million class I-A-1B downgraded to 'A-' from 'AAA';
   -- $4.6 million class I-A-1C downgraded to 'A-' from 'AAA';
   -- $24.2 million class I-A-2A downgraded to 'A-' from 'AAA';
   -- $8.0 million class I-A-2B downgraded to 'A-' from 'AAA';
   -- $49.1 million class I-A-3 downgraded to 'A-' from 'AAA';
   -- $1.9 million class I-PO downgraded to 'A-' from 'AAA';
   -- $0.0 million class I-X affirmed at 'AAA';
   -- $8.9 million class I-B-1 downgraded to 'BBB+' from 'AA';
   -- $4.3 million class I-B-2 downgraded to 'BBB-' from 'A';
   -- $2.8 million class I-B-3 downgraded to 'BB' from 'BBB';
   -- $2.7 million class I-B-4 downgraded to 'B' from 'BB';
   -- $2.4 million class I-B-5 downgraded to 'DR' from 'B';

Bear Stearns Asset Backed Securities Trust 2006-SD4
   -- $50.3 million class 1A-1 affirmed at 'AAA';
   -- $18.0 million class 1A-2 affirmed at 'AAA';
   -- $17.5 million class 1A-3 affirmed at 'AAA';
   -- $45.0 million class 2A-1 affirmed at 'AAA';
   -- $7.7 million class 2A-2 affirmed at 'AAA';
   -- $34.4 million class 3A-1 affirmed at 'AAA';
   -- $5.9 million class 3A-2 affirmed at 'AAA';
   -- $14.4 million class B-1 downgraded to 'BBB+' from 'AA';
   -- $6.7 million class B-2 downgraded to 'BBB-' from 'A';
   -- $3.9 million class B-3 downgraded to 'BB' from 'BBB';
   -- $1.8 million class B-4 downgraded to 'B+' from 'BB';
   -- $2.7 million class B-5 downgraded to 'B' from 'B';
   -- $0.0 million class X-2 affirmed at 'AAA';

Bear Stearns Asset Backed Securities Trust 2006-2
   -- $33.9 million class A-1 affirmed at 'AAA';
   -- $34.7 million class A-2 affirmed at 'AAA';
   -- $9.7 million class A-3 affirmed at 'AAA';
   -- $15.6 million class M-1 affirmed at 'AA';
   -- $4.4 million class M-2 affirmed at 'AA-';
   -- $7.8 million class M-3 affirmed at 'A';
   -- $3.5 million class M-4 affirmed at 'A-';
   -- $3.4 million class M-5 affirmed at 'BBB+';
   -- $3.0 million class M-6 affirmed at 'BBB';
   -- $3.0 million class M-7 affirmed at 'BBB-';

Bear Stearns Asset Backed Securities Trust 2007-SD1 ARMs
   -- $42.4 million class II-1A-1 affirmed at 'AAA';
   -- $5.3 million class II-1A-2 affirmed at 'AAA';
   -- $31.9 million class II-2A-1 affirmed at 'AAA';
   -- $4.0 million class II-2A-2 affirmed at 'AAA';
   -- $30.0 million class II-3A-1 affirmed at 'AAA';
   -- $3.8 million class II-3A-2 affirmed at 'AAA';
   -- $7.8 million class II-B-1 downgraded to 'BBB+' from 'AA';
   -- $3.0 million class II-B-2 downgraded to 'BBB-' from 'A';
   -- $2.1 million class II-B-3 downgraded to 'BB' from 'BBB';
   -- $0.9 million class II-B-4 downgraded to 'B+' from 'BB';
   -- $0.7 million class II-B-5 rated 'B', placed on Rating Watch
      Negative;

Bear Stearns Asset Backed Securities Trust 2007-SD1 FRMs
   -- $35.7 million class I-A-1 affirmed at 'AAA';
   -- $23.3 million class I-A-2A affirmed at 'AAA';
   -- $2.5 million class I-A-2B affirmed at 'AAA';
   -- $26.2 million class I-A-3A affirmed at 'AAA';
   -- $2.8 million class I-A-3B affirmed at 'AAA';
   -- $1.7 million class I-PO affirmed at 'AAA';
   -- $0.0 million class I-X affirmed at 'AAA';
   -- $5.3 million class I-B-1 downgraded to 'BBB+' from 'AA';
   -- $3.0 million class I-B-2 downgraded to 'BBB-' from 'A';
   -- $1.9 million class I-B-3 downgraded to 'BB' from 'BBB';
   -- $1.2 million class I-B-4 downgraded to 'B+' from 'BB';
   -- $0.8 million class I-B-5 rated 'B', placed on Rating Watch
      Negative;

Bear Stearns Asset Backed Securities Trust 2007-SD2 FRMS
   -- $30.1 million class I-A-1A affirmed at 'AAA';
   -- $1.6 million class I-A-1B affirmed at 'AAA';
   -- $22.6 million class I-A-2A affirmed at 'AAA';
   -- $1.2 million class I-A-2B affirmed at 'AAA';
   -- $45.1 million class I-A-3A affirmed at 'AAA';
   -- $2.4 million class I-A-3B affirmed at 'AAA';
   -- $1.7 million class I-PO affirmed at 'AAA';
   -- $0.0 million class I-X affirmed at 'AAA';
   -- $8.1 million class I-B-1 downgraded to 'BBB+' from 'AA';
   -- $4.9 million class I-B-2 downgraded to 'BBB-' from 'A';
   -- $2.8 million class I-B-3 downgraded to 'BB' from 'BBB';
   -- $2.4 million class I-B-4 downgraded to 'B+' from 'BB';
   -- $1.5 million class I-B-5 rated 'B', placed on Rating Watch
      Negative.


BERRY PLASTICS: Posts $29.3MM Net Loss in Quarter Ended March 29
----------------------------------------------------------------
Berry Plastics Corp. reported a net loss of $29.3 million for the
second quarter ended March 29, 2008, compared with a net loss of
$13.6 million in the corresponding period ended March 31, 2007.

Net sales increased 14.0% to $844.3 million for the quarter from
$741.6 million for the prior quarter.  This $102.7 million
increase includes acquisition volume growth of 9.0%.  

Net sales in the rigid open top business increased from
$219.5 million in the prior quarter to $247.9 million in the
quarter.  Base volume growth in the rigid open top business,
excluding net selling price increases, was 5.0% driven primarily
by growth in the company's various container product lines and
thermoformed drink cups.  

Net sales in the rigid closed top business increased from
$155.2 million in the prior quarter to $211.2 million in the
quarter primarily as a result of acquisition volume growth
attributed to Captive and MAC totaling $51.0 million for the
quarter.  

The flexible film business net sales increased from $229.2 million
in the prior quarter to $257.8 million in the quarter.   
Acquisition volume growth attributed to Rollpak was $14.3 million
for the quarter.  Base volume declined, excluding net selling
price increases, by 11.0% for the quarter primarily due to
softness in the housing market and the company's decision to
discontinue historically lower margin business.

Net sales in the tapes/coatings business decreased from
$137.7 million in the prior quarter to $127.4 million in the
quarter primarily driven by softness in the new home construction
and automotive markets partially offset by strong volume growth in
the corrosion protection business.

Gross profit decreased by $9.3 million to $112.4 million for the
quarter from $121.7 million for the prior quarter.  This decrease
is primarily attributed to the timing lag of passing through
increased raw material costs to customers as well as $2.4 million
of purchase accounting inventory adjustments related to the
acquisitions of Captive and MAC partially offset by additional
sales volume and productivity improvements in the flexible films
and tapes/coatings segments as a result of realizing synergies
from the Berry Covalence merger.

Total operating expenses increased to $91.2 million, from
$84.1 million in the prior quarter, primarily as a results of
increases in selling, general and administrative expenses.

Net interest expense increased $8.1 million to $67.2 million for
the quarter from $59.1 million in the prior quarter primarily as a
result of increased borrowings to finance the Captive acquisition.

For the quarter, the company recorded an income tax benefit of
$16.7 million or an effective tax rate of 36.3%, which is a change
of $9.4 million from the income tax benefit of $7.3 million or an
effective tax rate of 34.1% in the prior quarter.

                  26 Weeks Ended March 29, 2008

Net sales increased 11.0% to $1.6 billion billion for the 26 weeks
ended March 29, 2008, from $1.4 billion for the same period ended
March 31, 2007.  This $161.8 million increase includes 6.0%
acquisition related volume growth.  

Gross profit increased by $13.1 million to $221.2 million from
$208.1 million for the 26 weeks ended March 31, 2007.  This
increase is primarily the result of the additional sales volume
and productivity improvements in the flexible films and
tapes/coatings segments as a result of realizing synergies from
the Berry Covalence Merger.  

Selling, general and administrative expenses increased by
$14.0 million to $165.4 million for the 26 weeks ended March 29,
2008, from $151.4 million during the same period of fiscal 2007.  

Restructuring and impairment charges were $5.2 million primarily
as a result of costs incurred associated with the plant
consolidations within the flexible films and tapes/coatings
segments.  Other expenses increased from $7.5 million during the
26 weeks ended March 31, 2007, to $18.9 million for the 26 weeks
ended March 29, 2008, primarily as a result of expenses associated
with the integration of Old Covalence and the corresponding
achievement of synergies.

Net interest expense increased $9.7 million to $128.7 million for
from $119.0 million in the prior 26 week period primarily as a
result of increased borrowings to finance the Captive acquisition.

The company recorded an income tax benefit of $36.4 million or an
effective tax rate of 37.5%, which is a change of $9.6 million
from the income tax benefit of $26.8 million or an effective tax
rate of 36.3% in the prior 26-week period.

Net loss was $60.6 million for the 26 weeks ended March 29, 2008,
compared to a net loss of $44.4 million for the 26 weeks ended
March 31, 2007.

                 Liquidity and Capital Resources

The company's senior secured credit facilities consist of a
$1.2 billion term loan and a $400.0 million asset based revolving
line of credit.  The term loan matures on April 3, 2015, and the
revolving line of credit matures on April 3, 2013.  

At March 29, 2008, the company had unused borrowing capacity of
$243.8 million under the revolving line of credit.  The company
was in compliance with all covenants at March 29, 2008.

At March 29, 2008, the company had outstanding long-term debt of
$3.3 billion, compared to $2.7 billion at Sept. 29, 2007.

                          Balance Sheet

At March 29, 2008, the company's consolidated balance sheet showed
$4.5 billion in total assets, $4.1 billion in total liabilities,
and $380.4 million in total stockholders' equity.

Full-text copies of the company's consolidated financial
statements for the thirteen weeks ended March 29, 2008, are
available for free at http://researcharchives.com/t/s?2c00

                       About Berry Plastics

Headquartered in Evansville, Ind., Berry Plastics Corporation
-- http://www.berryplastics.com/-- is a manufacturer and marketer  
of plastic packaging products.  Berry Plastics products include
open-top and closed top packaging, polyethylene-based plastic
films, industrial tapes, medical specialties, packaging, heat-
shrinkable coatings and specialty laminates.   

                          *     *     *

As reported in the Troubled Company Reporter on April 16, 2008,
Moody's Investors Service affirmed its Caa1 (LGD 4, 63%) rating on
each of the company's $225.0 million senior secured second lien
FRN due 2014 and $525.0 million senior secured lien notes due
2014, and its Caa2 (LGD 5, 85%) rating on the company's
$265.0 million senior subordinated notes due 2016.


BLOCKBUSTER INC: Earns $45 Million in Quarter ended April 6
-----------------------------------------------------------
Blockbuster Inc. reported net income of $45.4 million for the
first quarter ended April 6, 2008, an improvement of $94.4 million
as compared with a net loss of $49.0 million for the first quarter
of 2007.

Total revenues decreased 5.4% to $1.39 billion for the first
quarter of 2008 from $1.47 billion for the first quarter of 2007,
as a result of fewer company-operated stores.  

Domestic same-store revenues increased 2.9% as compared to the
first quarter of 2007, reflecting a 920 basis point improvement
over the first quarter of 2007.  This increase was driven by a
0.4% growth in same-store rental revenues and a 19.7% increase in
same-store merchandise sales.  

International same-store revenues decreased 1.5% from the same
period last year, reflecting a 0.9% increase in same-store rental
revenues and a 4.9% decline in same-store merchandise sales.  
Worldwide same-store revenues grew 1.4% from the same period last
year.

"The significant improvement in our first quarter results
demonstrates the underlying strength of our core rental and
emerging retail business," Jim Keyes, Blockbuster chairman and
CEO, said.  "BLOCKBUSTER Total Access(TM), our subscription rental
offering, is now profitable and positioned for growth."

"Additionally, our stores achieved positive growth in both sales
and margin," Mr. Keyes added.  "We are particularly pleased that
domestic same-store revenues showed an improvement for the first
time in five years primarily as a result of several initiatives we
have put in place, including an increased availability of top new
movies, improved store merchandising and more effective pricing."

"Going forward, we are confident we can continue to grow our core
business, which will enable us to focus on aggressive development
of our digital offerings," Mr. Keyes continued.  "Our ability to
provide convenient access to both physical and electronic media
entertainment will provide Blockbuster a meaningful competitive
advantage and allow us to create enhanced shareholder value over
the long-term."

                Liquidity and Capital Resources

As of April 6, 2008, no balance was outstanding under the
company's revolving credit facility and $406.5 million was
outstanding under the term loan portions of its credit facilities.
The available borrowing capacity under the revolving credit
facility, excluding the $150.0 million reserved for issuance of
letters of credit provided for Viacom Inc. at Viacom's expense,
and $52.7 million reserved to support other letters of credit,
totaled $222.3 million at April 6, 2008.

Net cash flows from financing activities increased $56.9 million
to $9.1 million of cash used for financing activities during the
first quarter of 2008 from $66.0 million of cash used for
financing activities during the first quarter of 2007.  This
change was due to a $56.3 million decrease in net debt repayments.

At April 6, 2008, the company has cash and cash equivalents of
$137.7 million.  Working capital was $77.2 million as compared to
$30.7 million at Jan. 6, 2008.

At April 6, 2008, the company's balance sheet data showed total
assets of $2.6 billion, total liabilities of $1.9 billion and
total shareholders' equity of $706.5 million.

                   About Blockbuster Inc.

Based in Dallas, Texas, Blockbuster Inc. (NYSE: BBI,
BBI.B) -- http://www.blockbuster.com/-- is a leading global         
provider of in-home movie and game entertainment, with over
7,800 stores throughout the Americas, Europe, Asia and
Australia.  The company maintains operations in Brazil, Mexico,
Denmark, Italy, Taiwan, and Australia.

At Jan. 6, 2008, the company's total debt, including capital
lease obligations was US$757.8 million compared with US$984.2
million in Dec. 31, 2006.

                          *     *     *

In December 2007, Fitch Ratings affirmed Blockbuster Inc.'s
long-term Issuer Default Rating at 'CCC' and the senior
subordinated notes at 'CC/RR6'.  The rating outlook is stable.


BLUE SKY 2: Case Summary & Two Largest Unsecured Creditors
----------------------------------------------------------
Debtor: Blue Sky 2, Inc.
        aka Old Barn Restaurant
        8100 S. Parkside
        Burbank, IL 60459

Bankruptcy Case No.: 08-12097

Type of Business: The Debtor owns and operates a restaurant.

Chapter 11 Petition Date: May 13, 2008

Court: Northern District of Illinois (Chicago)

Judge: Eugene R. Wedoff

Debtor's Counsel: Karl L. Halperin, Esq.
                  Rosenfield, Kaplan & Halperin
                  6160 N. Cicero, Ste. 320
                  Chicago, IL 60646
                  Tel: (773) 481-2700

Estimated Assets: $100 million to $500 million

Estimated Debts:  $100 million to $500 million

Debtor's Two Largest Known Creditors:

   Entity                      Claim Amount
   ------                      ------------
Becker Dairy                   unknown
4224 W. Chicago
Chicago, IL 60651

Anmar Foods, Inc.              unknown
2150 W. Carroll Ave.
Chicago, IL 60638


BLUE WATER: Files Liquidation Analysis Under Chapter 11 Plan
------------------------------------------------------------
Blue Water Automotive Systems, Inc., and its debtor affiliates
delivered to the U.S. Bankruptcy Court for the Eastern District of
Michigan a liquidation analysis to assist holders of claims and
interests in determining whether they will recover at least as
much in the going concern Chapter 11 sale as they would recover in
a forced liquidation sale by a Chapter 7 trustee, and subsequently
assist them in determining whether to accept or reject their Joint
Plan of Liquidation.

As reported by the Troubled Company Reporter on May 15, the
Debtors' Liquidation Plan provides for the sale of substantially
all of their assets in a going concern sale pursuant to Chapter 11
rather than liquidating under Chapter 7 of the Bankruptcy Code.

According to John A. Simon, Esq., at Foley & Lardner LLP, in
Wilmington, Delaware, the Debtors' going concern sale under their
Chapter 11 Plan will provide at least as much of a recovery to
holders of Claims or Equity Interests as the holders would
receive in a Chapter 7.  The Chapter 11 sale will be of
substantially all of the Debtors' assets.  The Debtors have
engaged an investment banker to conduct a sale process, in which
the Debtors have invested a substantial amount of time, effort
and resources in extensively marketing substantially all of the
Debtors' assets for a sale.  A sale is expected to close by
June 30, 2008.  The Sale will preserve the goodwill embedded in
the Debtors as a going concern, he says.

In contrast, Mr. Simon says a Chapter 7 liquidation would be a
forced sale, after the Debtors' operations have ceased.  Goodwill
would not be preserved in a Chapter 7 liquidation.  Moreover, it
is unlikely that the assets being sold in the Debtors' current
Chapter 11 sale process would be available to be liquidated by a
Chapter 7 trustee.  Because the Debtors have no equity in their
assets in a forced liquidation, in a Chapter 7 liquidation, the
Debtors' secured creditors would be entitled to lift the
automatic stay to foreclose on their collateral.  Therefore, in a
Chapter 7, the only assets likely to be subject to administration
by the Trustee for the benefit of holders of Claims and Equity
Interests would be the Causes of Action, which will otherwise
become Creditors Trust assets under the Plan.  In addition, in a
Chapter 7 proceeding, the trustee is entitled to a percentage of
the distributions made by the trustee.  The distribution is in
addition to the costs and expenses associated with pursuing the
Causes of Action.  Furthermore, the Chapter 7 trustee's
professionals are entitled to be paid ahead of the Allowed Claims
and Equity Interests against the Debtors.  

Mr. Simon says that the analysis of the Best Interests Test under
Section 1129(a)(7) is based on a number of assumptions, which are
subject to significant business, economic, and competitive
uncertainties and contingencies beyond the control of the Debtors
and their management.  For the purposes of the Liquidation
Analysis, assumptions are based on the forced liquidation value
of the fixed assets as determined by recent appraisals of the
assets.

As to current assets, the Liquidation Analysis assumes estimated
and unaudited book values of the Debtors assets on April 30,
2008.  The analysis is subject to any changes due to the Debtors'
continued operation.  The book values used were obtained from the
Debtors' draft financial statements and accounting records.  The
values have not been subject to review or audit by an independent
accounting firm, Mr. Simon says.

Inventories consist primarily of raw materials, work-in-process,
and finished goods of Blue Water's products.  Inventories do not
include tooling inventory.  Current inventory is estimated to be
approximately $6.5 million.  Inventory aged greater than 90 days
is estimated to be one-third of total inventory and is estimated
to total approximately $2.9 million.  Prepaid items, consisting
of prepaid maintenance contracts and prepaid finance charges
related to prior financings, are estimated to be approximately
$1,800,000.  Prepaid expenses are estimated to be approximately
$3,900,000.  The DIP Credit Facility, as of May 9, 2008, totaled
$28,700,000.

A full-text copy of the Liquidation Analysis is available for
free at http://bankrupt.com/misc/bw_liquidationanalysis.pdf

                Blue Water Automotive Systems, Inc.
                        Balance Sheet
                      As of April 30, 2008

ASSETS:
Working Capital and other assets                                      
   Cash and cash equivalents                          $1,876,913
   Accounts Receivable:
      Trade                                           22,715,018
         Participating Customers                       9,066,573
         Non-participating Customers                  13,648,445
      Tooling                                         15,178,243
                                                     -----------
   Net Accounts Receivable                           $37,893,261
                                                   
   Inventory                                           6,476,052
   Inventory - Aged                                    2,911,202

   Prepaid Items                                       1,801,760

   Other Assets                                   
      Other current and long term assets               3,919,743
      Other Assets                                             -
                                                     -----------
      Total Other Assets                              $3,919,743
                                                     -----------
   Total Working Capital Assets                      $54,878,931
   Equipment Surplus                                           -

   Available to Satisfy the DIP Facility Balance               -
   Less DIP Facility Balance                                   -
   
   Working Capital Assets Available for Liquidation

   Equipment and Real Estate Assets Available
   for Liquidation by the Chapter 7 Trustee

   Other Items
      Chapter 5 Causes of Action                       2,337,987
      Claims Against Sarnautomotive                    1,250,000
      Owned Tooling                                            -

   Estimated Proceeds Available for
   Liquidation by the Chapter 7 Trustee:
     Less costs associated with liquidation
       Chapter 7 Trustee fees                                  -
       Administrative Expenses                                 -
                                                     -----------
    Total costs associated with liquidation                    -

   Net Estimated Proceeds for Liquidation
   by the Chapter 7 Trustee                                    -


                      Liquidation Analysis
         Estimated Recovery Rate and Liquidation Value

                                  Recovery                  Value
                                -----------        ---------------------
                                Low    High           Low        High
                                ---    ----        ---------- ----------
                                 
Working Capital and other assets                                      
   Cash and cash equivalents       100%    100%   $1,876,913 $1,876,913
   Accounts Receivable            
     Trade                 
      Participating Customers        0%     35%            -  3,173,300

      Non-participating Customers   10%     45%    1,346,845  6,141,800
     Tooling                         0%     15%            -  2,276,736
                                                   ---------  ---------
       Net Accounts Receivable                     1,346,845 11,591,836
                                        
   Inventory                        62%     76%    4,036,199  4,907,228
   Inventory Aged                    5%     10%      145,560    291,120

   Prepaid Items                     0%      0%            -          -

   Other Assets                                   
     Other current and long term     0%     17%            -    665,050
     Other Assets                    0%      0%            -          -
                                                   --------- ----------
      Total Other Assets                                   -    665,050
                                                   --------- ----------
   Total Working Capital Assets                    7,423,517 19,332,149
   Equipment Surplus                               5,876,787  5,876,787
                                                   --------- ----------
Available to Satisfy DIP
   Credit Facility Balance                        13,300,304 25,208,935
Less, DIP Credit Facility Balance              (28,690,568)(28,690,568)
                                                  ----------  ----------
Working Capital Assets
Available for Liquidation                                 -           -

Equipment and Real Estate Assets
Available for Liquidation by the
Chapter 7 Trustee                                         -           -

Other Items            
   Chapter 5 Causes of Action        10%     50%     233,799  1,168,994
   Claims Against Sarnautomotive     20%    100%     250,000  1,250,000
   Owned Tooling                      0%      0%           -          -
                                                   --------- ----------

Estimated Proceeds Available                        483,799  2,418,994
for Liquidation by the Chap. 7 Trustee            
   Less costs associated with liquidation        
     Chapter 7 Trustee fees                          (14,514)   (72,570)
     Administrative Expenses                      (4,277,000)(3,207,750)
                                                   --------- ----------
   Total costs associated with liquidation      ($4,291,514)($3,280,320)

Net Estimated Proceeds for Liquidation by   
the Chapter 7 Trustee                                    -           -
                                                   --------- ----------
                                                          0%         0%

                       Liquidation Analysis
                     Estimated Midpoint Value

Assets
Working Capital and other assets                                      
   Cash and cash equivalents                         $1,876,913

   Accounts Receivable
      Trade                 
         Participating Customers                      1,586,650
         Non-participating Customers                  3,753,322
      Tooling                                         1,138,368
                                                     ----------
   Net Accounts Receivable                           $6,478,340
                                                   
   Inventory                                          4,471,714
   Inventory Aged                                       218,340

   Prepaid Items                                              -

   Other Assets                                   
      Other current and long term assets                332,525
      Other Assets                                            -
                                                    -----------
      Total Other Assets                               $332,525
                                                    -----------
   Total Working Capital Assets                     $13,377,833
   Equipment Surplus                                  5,876,787

   Available to Satisfy the DIP Facility Balance     19,254,620
   Less, DIP Credit Facility Balance                (28,690,568)

   Working Capital Assets Available for Liquidation           -
   
   Equipment and Real Estate Assets Available               
   for Liquidation by the Chapter 7 Trustee                   -

   Other Items
      Chapter 5 Causes of Action                        701,396
      Claims Against Sarnautomotive                     750,000
      Owned Tooling                                           -

   Estimated Proceeds Available for
   Liquidation by the Chap. 7 Trustee                 1,451,396
      Less costs associated with liquidation
         Chapter 7 Trustee fees                         (43,542)
         Administrative Expenses                     (3,742,375)
                                                    -----------
    Total costs associated with liquidation                   -
                                                    -----------
   Net Estimated Proceeds for Liquidation                    
   by the Chapter 7 Trustee                                   -

                  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
operations 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 Debtors filed their Liquidation Plan on May 9, 2008.  The
Court will convene a hearing May 23 to consider approval of the
Disclosure Statement explaining the Plan, for voting purposes.  
The Court will hold a hearing June 18, 2008, to consider
confirmation of the Plan.  (Blue Water Automotive Bankruptcy
News, Issue No. 14, Bankruptcy Creditors' Service Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)


BLUE WATER: Gets Permission to Pay Incentives to Employees
----------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Michigan
authorizes Blue Water Automotive Systems, Inc., and its affiliated
debtors to pay incentives to certain critical employees.

The Incentive Payments will be made upon the closing of the sale
of the Debtors' assets, the Critical Employees will be eligible
for $323,577 in aggregate Incentive Payments if they:

   (i) perform their duties in a manner in the judgment of upper
       management of the Debtors; and

  (ii) are in the employ of the Debtors upon the closing of the
       sale.  

The balance of Incentive Payments, aggregating $174,234, will be
paid to the Critical Employees upon the closing of the sale (a)
if there are no defaults under the Accommodation Agreements with
the Major Customers that are not waived; and (b) in proportion to
the Debtors' collection, on a percentage basis, of prepetition,
non-participating customer accounts receivable aged over 60 days.  
If the Non-Participating Customer AR is reduced by 50% upon
closing of the sale of the Debtors' assets, 50% of the Reserve
will be paid to the Employees.

A schedule delineating the methodology is set out by the Court:

Total NP Customers Receivables > 60 days at 5/5/08    $4,078,868
Less cushion/reserve (20%)                              (815,774)
                                                       ---------
  Subtotal NP Customers Receivables                   $3,263,094
                                                       =========

Collection Percentage of NP Customer Receivables> 60 days:

           Percentage         Amount              Bonus
           ----------         ------              -----
              33%           $1,076,821          $57,497
              66%            2,153,642          114,994
             100%            3,263,094          174,234

As previously reported by the Troubled Company Reporter in April,
the Debtors proposed to make incentive payments totaling
US$497,812 to a limited number of critical, non-insider employees.  
The Critical Employees are mid-level employees who are critical to
the day-to-day operations of the Debtors.  The Debtors argued that
the Incentive Payments are necessary to appropriately compensate
the Critical Employees, given the enormous additional burdens
placed on them by these bankruptcy proceedings, and to ensure that
the Employees remain motivated to perform the important tasks
necessary to maintain the value of the Debtors' businesses.

According to the Troubled Company Reporter on May 15, 2008, the
Debtors' counsel, Nicole Y. Lamb-Hale, Esq., at Foley & Lardner,
LLP, in Detroit, Michigan, clarified that the Incentive Payments,
if any, will be paid only upon consummation of a sale of the
Debtors' assets.

                  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
operations 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 Debtors filed their Liquidation Plan on May 9, 2008.  The
Court will convene a hearing May 23 to consider approval of the
Disclosure Statement explaining the Plan, for voting purposes.  
The Court will hold a hearing June 18, 2008, to consider
confirmation of the Plan.  (Blue Water Automotive Bankruptcy
News, Issue No. 14, Bankruptcy Creditors' Service Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)


BOISE INC: Moody's Lifts Loan Rtng. to B1; Revises Outlook to Pos.
------------------------------------------------------------------
Moody's Investors Service changed Boise Inc.'s outlook to stable
from positive and upgraded its second lien term loan to B1 from B2
based on the company's revised capital structure after the
completion of its acquisition of Boise Cascade's Paper and
Packaging & Newsprint segments.  The revision increased term loan
borrowings and introduced a subordinated PIK note into the capital
structure, which improves the relative rating of the second lien
term loan, leading to a one-notch upgrade.  The company's
corporate family rating remains Ba3. All other ratings were
affirmed.

During the shareholder voting process to approve the acquisition,
approximately 30% of the shareholders eligible to vote elected to
convert their shares to cash.  This required the raising of $120
million of debt.  In the Dec. 26, 2007 rating action, Moody's
stated that the positive outlook was based on the transaction
being consummated without any stockholders exercising their
conversion rights and that the company would have approximately
$946 million of outstanding indebtedness.  Moody's also stated
that if a significant number of shareholders decided to exercise
their conversion rights, the outlook might be changed to stable.  
The transaction closed on February 22, 2008 and as of March 31,
2008, the company had approximately $1.1 billion of outstanding
indebtedness due to the lower than anticipated equity
consideration.

The equity shortfall of approximately $120 million was financed by
Boise's issuance of a $59 million subordinated 15.75% related-
party PIK note to Boise Cascade (matures in 2015) and an increase
of $61 million to the second lien term loan.  The introduction of
the loss absorbing PIK note primarily drove the one-notch upgrade
to the second lien term loan, to B1.  Under Moody's loss-given-
default methodology, the expected loss for the second lien term
loan decreased based on the revised capital structure.

Boise's ratings still reflect the reasonable amount of leverage at
transaction close and Moody's expectation of strong and stable
operating performance over the intermediate term.  Moody's
believes that the company's market position as the third largest
producer of uncoated free sheet paper in North America, favorable
industry supply trends from recent consolidation and
rationalization actions, and pricing improvements will allow the
company to generate margins and free cash flow appropriate for a
Ba3 corporate family rating.  The ratings also consider the
challenges of shifting to higher margin specialty products, input
cost pressures, and declining demand in certain of Boise's
products.

Ratings Upgraded:

  -- Second Lien Secured Term Loan, to B1 (LGD5 81%) from B2

Rating Affirmed:

  -- Corporate Family Rating, Ba3

First Lien Secured Revolver, Ba2 (LGD3, 36%)

  -- First Lien Secured Term Loan A, Ba2 (LGD3, 36%)

First Lien Secured Term Loan B, Ba2 (LGD3, 36%)

  -- Speculative Grade Liquidity Rating, SGL-2

The outlook is stable.

Boise Inc., headquartered in Boise, Idaho, is the third largest
North American producer in uncoated free sheet paper and has a
significant presence in the markets for linerboard, corrugated
containers, and specialty and premium paper products.


BUFFETS HOLDINGS: U.S. Trustee Balks at Employees Incentive Plan
----------------------------------------------------------------
Roberta A. DeAngelis, acting United States Trustee for Region 3,
tells the United States Bankruptcy Court for the District of
Delaware, that from the information contained in a motion to
approve an annual incentive plan by Buffets Holdings Inc. and its
debtor-affiliates, approximately 15 of the employees included in
the plan appear to be officers, directors, or persons in control,
and thus insiders within the meaning of Section 101 of the
Bankruptcy Code.

Ms. DeAngelis says she objects to the motion to the extent
that the Debtors assert --  but do not demonstrate -- that the
payments proposed to be made under the Debtors' AIP are ordinary
course transactions not subject to review under Section (503)(c)
of the Bankruptcy Code.

Ms. DeAngelis also objects to the Debtors' assertion that Section
503(c)(3) simply subjects the AIPs to review under the business
judgment rule.

"[T]he Debtors have not demonstrated in the Motion that the
modified 2008 AIP and the new 2009 AIP are ordinary course
transactions," Ms. DeAngelis says.  "[T]he Debtors' assertion
that section 503(c)(3) of the Bankruptcy Code only subjects the
proposed bonus payments to review under the business judgment
rule fails to accord proper meaning to the new limitations
imposed by section 503(c)(3) of the Bankruptcy Code."  

Section 503(c)(3) provides that "notwithstanding Section (b),
there shall neither be allowed nor paid-other transfers or
obligations that are outside the ordinary course of business and
not justified by the facts and circumstances of the case      
including transfers made to, or obligations incurred for the
benefit of, officers, managers, or consultants hired after the
date of the filing of the petition."

The Debtors must demonstrate that the AIPs are necessary to
preserve the value of the Debtors' estates and are "justified by
the facts and circumstances of the case," Ms. DeAngelis asserts.

As reported in the Troubled Company Reporter on May 13, 2008,
the Debtors asked the Court to approve their performance-based
Annual Incentive Plans for fiscal years 2008 and 2009.

To remain competitive, the Debtors, like many large companies,
have traditionally incorporated into their management
compensation system an annual performance-based incentive
component.

The historical targeted incentive programs provided for bonuses
to be paid to the Employees if the Debtors attained 50% of the
Debtors' targeted EBITDA levels, with the bonus amounts
increasing if the Debtors attained 100% of the Debtors' targeted
EBITDA.  These targeted incentive programs were offered to
Employees, in addition to other bonus packages, to provide bonus
compensation.  Prior to the Petition Date, the Board of Directors
implemented precisely this sort of EBITDA-based incentive program
for fiscal year 2008.

           Incentive Compensation for Fiscal Year 2008

In the discretion of the Board of Directors, management Employees
participating in the 2008 AIP would be eligible for incentive
compensation that is linked to the Debtors' aggregate EBITDA
exceeding $80,035,512 for the 2008 fiscal year -- the EBITDA
level for the fiscal year set forth in the Debtors' debtor-in-
possession budget.  This is consistent with the general structure
of incentive bonus plans historically offered to Employees, which
have been based on the Debtors' overall financial performance,
which is primarily focused on EBITDA.

The modified 2008 AIP proposed by the Debtors would provide
Employees with a bonus payment only if the Debtors exceed the
2008 Performance Goal by a minimum of $250,000.  If the EBITDA
for fiscal year 2008 is between $80,285,512 and $81,995,512, a
discretionary pool of bonus funds, up to the maximum amount of
$1,710,000, will be created, plus 10% of any EBITDA growth above
$81,995,512.  

The 2008 Pool would be used to fund incentive payments to the
Employees:

   * 54% of the 2008 Pool to approximately 15 Employees with
     titles of Vice President and above, allocated among the
     Employees based on their 2008 base salary;

   * 36% of the 2008 Pool to approximately 102 Employees who are
     corporate support employees, allocated among the Employees
     based on their 2008 base salary;

   * 10% of the 2008 Pool to be allocated to Employees in the two
     groups disclosed -- excluding the Debtors' chief executive
     officer and chief operating officer -- who have been        
     determined by the Board of Directors to have demonstrated
     exceptional performance in the fiscal year and in assisting
     the Debtors in exceeding the 2008 Performance Goal;
     provided that no individual Employee will receive more than
     $10,000 in compensation on account of this portion of the
     2008 Pool.

If the EBITDA generated by the Debtors' business exceeds the 2008
Performance Goal plus $250,000, but is less than $81,995,512, the
2008 Pool will be reduced dollar for dollar by the amount by
which EBITDA is less than $81,995,512.

           Incentive Compensation for Fiscal Year 2009

In the discretion of the Board of Directors, management
Employees participating in the AIPs would be eligible for
incentive compensation that is linked to EBITDA generated by the
Debtors' business for fiscal year 2009 EBITDA of $90,288,146, the
EBITDA level set forth in the Debtors' DIP budget for the 2009
fiscal year.

The 2009 AIP proposed by the Debtors would provide Employees with
a bonus payment upon the Debtors' exceeding the 2009 Performance
Goal.  If the EBITDA generated by the Debtors' business is
between $90,288,146 and $91,963,146, a discretionary pool of
bonus funds, up to the maximum amount of $1,675,000, will be
created, plus 50% of any EBITDA growth from $91,963,146 to
$92,463,146, plus 20% of any EBITDA growth from $92,463,146 to
$102,900,000.  The 2009 Pool will be used to fund incentive
payments to the Employees:

   * 54% of the 2009 Pool to approximately 15 Employees with
     titles of Vice President and above, allocated among the
     Employees based on their 2009 base salary;

   * 36% of the 2009 Pool to approximately 112 Employees who are
     corporate support employees, allocated among the Employees
     based on their 2009 base salary;

   * 10% of the 2009 Pool to be allocated to Employees in the two
     groups disclosed -- but excluding the Debtors' Chief
     Executive Officer and Chief Operating Officer -- who have
     been determined by the Board of Directors to have
     demonstrated exceptional performance in the fiscal year and
     in assisting the Debtors in exceeding the 2009 Performance
     Goal, provided that no individual Employee will receive
     more than $10,000 in compensation on account of this portion      
     of the 2009 Pool.

If the EBITDA generated by the Debtors' business exceeds the 2009
Performance Goal, but is less than $91,963,146, the 2009 Pool
will be reduced dollar for dollar by the amount by which EBITDA
is less than $91,963,146.

Furthermore, the Debtors would create an additional pool, equal
to 10% of any Fiscal Year 2009 EBITDA growth beyond $102,900,000,
which would be used to fund incentive payments to certain
Employees:

   * 75% of the Supplemental 2009 Pool to approximately 15
     Employees with titles of Vice President and above, allocated
     among the Employees based on their 2009 base salary;

   * 25% of the 2009 Pool to approximately 112 Employees who are
     corporate support employees, allocated among the Employees
     based on their 2009 base salary.

                  Incentive Compensation to COO

The Debtors also seek the court's approval to pay an incentive-
related bonus to Tahoe Joe's vice president and chief operating
officer upon completion of his first year of employment provided
that the COO satisfactorily completes the mutual goals and
objectives established by the Debtors and the COO.  The COO was
hired on November 16, 2007.

The Debtors and the COO agreed that the mutual objective to serve
as a condition precedent to the COO receiving a Personal
Performance Bonus would be a reduction in both the Debtors' food
and labor costs by at least one percent each, which would
correlate to an annual savings of approximately $30,000,000 in
operating costs.  

The maximum Personal Performance Bonus is $120,000. The Debtors
believe that any Personal Performance Bonus for which the COO
would be eligible would be earned postpetition and could
therefore be paid in the ordinary course.

However, the Debtors request confirmation that they Debtors are
authorized, in the sole discretion of the Board of Directors, to
honor and pay the Personal Performance Bonus to the COO as part
of the AIPs.  Since the COO is one of the parties who will share
in the 2008 Pool to be distributed if the Debtors exceed the 2008
Performance Goal, the total amount of bonus compensation to be
paid to the COO on account of the Personal Performance Bonus plus
his portion of the 2008 Pool will not exceed $120,000.

Pauline K. Morgan, Esq., at Young Conaway Stargatt & Taylor LLP,
in Wilmington, Delaware, tells the Court that performance-based
compensation forms an integral part of the total cash
compensation paid by the Debtors to their management team.

Ms. Morgan explains that the annual incentive plans are a
critical component of the Debtors' effort to reorganize their
business.  The annual incentive plan is necessary in order to
appropriately compensate the Debtors' management employees and to
ensure that the employees remain motivated to perform the
important tasks necessary to effect a successful reorganization
of the Debtors' businesses.

                     About Buffets Holdings

Headquartered in Eagan, Minnesota, Buffets Holdings Inc. --
http://www.buffet.com/-- is the parent company of Buffets,
Inc., which operates 626 restaurants in 39 states, comprised of
615 steak-buffet restaurants and eleven Tahoe Joe's Famous
Steakhouse restaurants, and franchises sixteen steak-buffet
restaurants in six states.  The restaurants are principally
operated under the Old Country Buffet, HomeTown Buffet, Ryan's and
Fire Mountain brands.  Buffets, Inc. employs approximately 37,000
team members and serves approximately 200 million customers
annually.

The company and all of its subsidiaries filed Chapter 11
protection on Jan. 22, 2008 (Bankr. D. Del. Case Nos. 08-10141 to
08-10158).  Joseph M. Barry, Esq., and Pauline K. Morgan, Esq., at
Young Conaway Stargatt & Taylor LLP, represent the Debtors in
their restructuring efforts.  The Debtors selected Epiq Bankruptcy
Solutions LLC as claims and balloting agent.  The U.S Trustee for
Region 3 appointed seven creditors to serve on an Official
Committee of Unsecured Creditors.  The Committee selected
Otterbourg Steindler Houston & Rosen PC as counsel.  The Debtors'
balance sheet as of Sept. 19, 2007, showed total assets of
$963,538,000 and total liabilities of $1,156,262,000.

As reported in the Troubled Company Reporter on Feb. 26, 2008,
the Court granted on February 22, 2008, final approval of the
Debtors' debtor-in-possession credit facility, consisting of
$85 million of new funding and $200 million carried over from the
company's prepetition credit facility. (Buffets Holdings
Bankruptcy News, Issue No. 15; Bankruptcy Creditors' Service Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).  


BUFFETS HOLDINGS: Court Sets July 21 as Claims Bar Date
-------------------------------------------------------
The United States Bankruptcy Court fort the District of Delaware
established July 21, 2008, at 4:00 p.m., as the deadline by which
all entities holding prepetition claims against Buffets Holdings
Inc. and its debtor-affiliates, including governmental units, must
file proofs of claim.

As reported in the Troubled Company Reporter on May 13, 2008,
in connection with the Debtors' rejection of executory contracts
or unexpired leases pursuant to Section 365 of the Bankruptcy
Code, the Debtors propose that any person or entity that asserts
a Rejection Damages Claim must file a proof of claim on or before
the later of:

   (a) the Claims Bar Date, or

   (b) 4:00 p.m., Prevailing Eastern Time, on the date that is
       30 days after entry of an order approving the rejection of
       an executory contract or unexpired lease pursuant to which
       the entity asserting the Rejection Damages Claim is a
       party, or

   (c) another date as the Court may fix.

The Debtors proposed that any entity holding an interest in the
Debtors need not file a proof of interest on or before the Claims
Bar Date.  Interest Holders that wish to assert claims against
the Debtors that arise out of or relate to the ownership or
purchase of an Interest, including claims arising out of or
relating to the sale, issuance or distribution of the Interest,
must file proofs of claim on or before the Claims Bar Date.

Any entity asserting Claims against more than one Debtor must
file a separate proof of claim with respect to each Debtor.  In
addition, any entity filing a proof of claim must identify on its
proof of claim form the particular Debtor against which its Claim
is asserted.

Any entity that is required to file a proof of claim in the
Chapter 11 cases pursuant to the Bankruptcy Code, the Bankruptcy
Rules or the Bar Date Order with respect to a particular claim
against the Debtors, but fails to do so by the applicable Bar
Date, should not be treated as a creditor with respect to the
Claim for the purposes of voting on and distribution under any
Chapter 11 plan proposed or confirmed in the Debtors' cases.

The Debtors proposed to serve all known entities holding potential
prepetition claims with: (a) a notice of the Bar Dates, and (b) a
proof of claim form.

The Bar Date Notice states, among other things, that proofs of
claim must be filed with Epiq Bankruptcy Solutions LLC on or
before the applicable Bar Date.  The Debtors propose that
claimants be permitted to submit proofs of claim in person or by
courier service, hand delivery, or mail.  Proofs of claim
submitted by facsimile or e-mail will not be accepted.  Proofs of
claim will be deemed filed when actually received by Epiq.

The Debtors also intended to publish a notice of the Bar Dates
within l0 business days of the date of entry of the order
approving the Claims Bar Date, in either the national edition of
The Wall Street Journal or the national edition of The New York
Times.

Pauline K. Morgan, Esq., at Young Conaway Stargatt & Taylor LLP,
in Wilmington, Delaware, told the Court that the establishment
of the Claims Bar Date is necessary for the Debtors to obtain
complete and accurate information regarding the nature, validity
and  amount of all claims that will be asserted in their Chapter
11 cases.  This will enable the Debtors to fully administer their
estates and to make distributions under any confirmed Chapter 11
plan, she says.

Headquartered in Eagan, Minnesota, Buffets Holdings Inc. --
http://www.buffet.com/-- is the parent company of Buffets,
Inc., which operates 626 restaurants in 39 states, comprised of
615 steak-buffet restaurants and eleven Tahoe Joe's Famous
Steakhouse restaurants, and franchises sixteen steak-buffet
restaurants in six states.  The restaurants are principally
operated under the Old Country Buffet, HomeTown Buffet, Ryan's and
Fire Mountain brands.  Buffets, Inc. employs approximately 37,000
team members and serves approximately 200 million customers
annually.

The company and all of its subsidiaries filed Chapter 11
protection on Jan. 22, 2008 (Bankr. D. Del. Case Nos. 08-10141 to
08-10158).  Joseph M. Barry, Esq., and Pauline K. Morgan, Esq., at
Young Conaway Stargatt & Taylor LLP, represent the Debtors in
their restructuring efforts.  The Debtors selected Epiq Bankruptcy
Solutions LLC as claims and balloting agent.  The U.S Trustee for
Region 3 appointed seven creditors to serve on an Official
Committee of Unsecured Creditors.  The Committee selected
Otterbourg Steindler Houston & Rosen PC as counsel.  The Debtors'
balance sheet as of Sept. 19, 2007, showed total assets of
$963,538,000 and total liabilities of $1,156,262,000.

As reported in the Troubled Company Reporter on Feb. 26, 2008,
the Court granted on February 22, 2008, final approval of the
Debtors' debtor-in-possession credit facility, consisting of
$85 million of new funding and $200 million carried over from the
company's prepetition credit facility. (Buffets Holdings
Bankruptcy News, Issue No. 15; Bankruptcy Creditors' Service Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).   


BUFFETS HOLDINGS: Wants to Limit Bank's Rights to Value Collateral
------------------------------------------------------------------
The Official Committee of Unsecured Creditors of Buffets
Holdings, Inc. and its debtor-affiliates asks the United States
Bankruptcy Court for the District of Delaware to issue an order
limiting the methods that may ultimately be used to value assets
of the Debtors' estates that are encumbered by the prepetition
security interests and liens that secure all obligations that were
owed by the Debtors to Credit Suisse, Cayman Islands Branch and
the Debtors' other prepetition lenders for whom Credit Suisse acts
as agent, as of the Debtors' bankruptcy filing.

Credit Suisse, et al., assert that the liens that secure their
prepetition claims encumber "substantially all" of the Debtors'
prepetition assets and that, as such, the value of their
collateral for purposes of Section 506(a) and (b) of the
Bankruptcy Code should be determined based on the "going concern
value" of the Debtors' entire "enterprise".

The Committee, however, contends that while the value of those
particular assets that are encumbered by Credit Suisse, et al.'s
prepetition liens may indeed be valued individually on a "going
concern" basis, the "going concern" value of any of the Debtors'
assets that are not subject to Credit Suisse and the lenders'
prepetition liens, and the value of any "good will" associated
with the unencumbered assets, must be subtracted from any "going
concern" valuation of the Debtors' entire "enterprise" to
determine the extent to which Credit Suisse, et al.:

   * are "over secured" or "under secured" for purposes of
     Section 506(a), and

   * may recover their contract interest, costs and fees under
     Section 506(b), in addition to the principal amount of their
     prepetition claims.

The unsecured creditors of the Debtors for whom the Committee
acts as fiduciary stand to be directly impacted by the method
ultimately employed to value Credit Suisse, et al.'s collateral
for purposes of Section 506(b), Laura Davis Jones, Esq., at
Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware,
explains.

If Credit Suisse, et al., are allowed to value their collateral
based on a so-called "enterprise" valuation that is not adjusted
for the value of those significant assets of the Debtors that are
not subject to any perfected liens, Credit Suisse and the lenders
may improperly be found to be fully secured under Section 506(b)
and therefore permitted to recover contract interest, fees or
costs in addition to the principal amount of the Debtors'
prepetition indebtedness.

"[T]his outcome could substantially deplete the pool of assets
otherwise available for application to the claims of Debtors'
other creditors," Ms. Jones says.

According to Ms. Jones, the value of the Debtors' assets that are
not encumbered by any of Credit Suisse, et al.'s prepetition
liens comprise a substantial portion of the overall value of the
Debtors' business enterprise that must be adjusted for in any
determination of the aggregate value of Credit Suisse, et al.'s
collateral.

The Committee maintains that absent actual dispositions of Credit
Suisse, et al.'s collateral from which the value of the assets
disposed of can be conclusively established, the value of Credit
Suisse, et al.'s prepetition collateral will be determined in the
Debtors' Chapter 11 cases only by using one or the other of these
two methods:

    (i) by valuing each of the specific assets that comprise
        Credit Suisse, et al.'s' collateral -- tangible and
        intangible -- and determining overall value based on the
        sum total of only those component parts; or

   (ii) by determining the overall "enterprise value" of the
        Debtors' businesses, first by using a recognized
        enterprise valuation method -- like the Discounted Cash
        Flow method, the Guideline Publicly Traded Company
        method, or the Guideline Merged and Acquired Company
        method -- and then by deducting from that computed
        amount: (a) the "going concern" value of those assets of
        the Debtors that are not encumbered by Credit Suisse, et
        al.'s perfected prepetition liens, and (b) a proportional
        amount of the overall "goodwill" value of the Debtors'
        enterprise, as determined by the ratio of the going
        concern value of Debtors' assets not encumbered by
        Credit Suisse, et al.'s prepetition liens to the "going
        concern" value of Debtors' assets that are encumbered by
        Credit Suisse, et al.'s' perfected prepetition liens
        times the value of all "goodwill" as determined at the
        time of valuation.

Headquartered in Eagan, Minnesota, Buffets Holdings Inc. --
http://www.buffet.com/-- is the parent company of Buffets,
Inc., which operates 626 restaurants in 39 states, comprised of
615 steak-buffet restaurants and eleven Tahoe Joe's Famous
Steakhouse restaurants, and franchises sixteen steak-buffet
restaurants in six states.  The restaurants are principally
operated under the Old Country Buffet, HomeTown Buffet, Ryan's and
Fire Mountain brands.  Buffets, Inc. employs approximately 37,000
team members and serves approximately 200 million customers
annually.

The company and all of its subsidiaries filed Chapter 11
protection on Jan. 22, 2008 (Bankr. D. Del. Case Nos. 08-10141 to
08-10158).  Joseph M. Barry, Esq., and Pauline K. Morgan, Esq., at
Young Conaway Stargatt & Taylor LLP, represent the Debtors in
their restructuring efforts.  The Debtors selected Epiq Bankruptcy
Solutions LLC as claims and balloting agent.  The U.S Trustee for
Region 3 appointed seven creditors to serve on an Official
Committee of Unsecured Creditors.  The Committee selected
Otterbourg Steindler Houston & Rosen PC as counsel.  The Debtors'
balance sheet as of Sept. 19, 2007, showed total assets of
$963,538,000 and total liabilities of $1,156,262,000.

As reported in the Troubled Company Reporter on Feb. 26, 2008,
the Court granted on February 22, 2008, final approval of the
Debtors' debtor-in-possession credit facility, consisting of
$85 million of new funding and $200 million carried over from the
company's prepetition credit facility. (Buffets Holdings
Bankruptcy News, Issue No. 15; Bankruptcy Creditors' Service Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).  


BUFFETS HOLDINGS: Wants Court's Okay to Amend Asset Sale Contract
-----------------------------------------------------------------
Buffets Holdings Inc. and its debtor-affiliates seek approval from
the United States Bankruptcy Court for the District of Delaware
to amend a contract for the sale and purchase of real estate
located at 40 Cavalier Blvd., in Florence, Kentucky.  The Debtors
also seek the Court's permission to extend the sale closing date
of the property from May 30, 2008, to July 14, 2008.

According to Pauline K. Morgan, Esq., at Young Conaway Stargatt &
Taylor, LLP, in Wilmington, Delaware, the Debtors seek to amend
the contract because the purchaser -- Value Place Real Estate
Services LLC -- has yet to obtain certain governmental approvals
necessary to begin the construction of a value place hotel on the
property.

In exchange for the Debtors' agreement to the Purchaser's request
to extend the closing date, the Purchaser has agreed to increase
the amount of its earnest deposit under the sale contract by
$5,000, Mr. Morgan says.

The Debtors submit that an extension of the closing date is an
ordinary course transaction for which it does not need court
approval.  However, out of an abundance of caution, the Debtors
ask the Court to approve the extension.

As reported in the Troubled Company Reporter on Feb. 20, 2008,
the Court authorized the Debtors to sell certain properties,
along with their rights, title and interest, free and clear of
encumbrances, pursuant sale contracts with different purchasers

Before the Debtors' bankruptcy filing, they determined that some
of their restaurants were not performing adequately and should be
closed and the underlying properties sold.  Accordingly, the
Debtors retained Huntley Mullaney Spargo & Sullivan LLC to
develop a marketing plan for the Properties.  

After coordinating with local estate brokers, Huntley Mullaney's
efforts resulted in the Debtors executing purchase agreements for
each of the Properties before the Petition Date.

The Properties and their purchasers are:

   Property                        Price   Purchaser
   --------                        -----   ---------
   6633 West Kellogg Drive      $990,000   Meridian Investments
   Wichita, Kansas                         LLC

   1207 South Main Street      2,000,000   Andy Yang, Wan B.
   Sikeston, Missouri                      Liu, Yong Eric Wang

   2623 Wards Road             1,000,000   Lucky Property LLC
   Lynchburg, Virginia

   40 Cavalier Blvd.             995,000   Value Place Real
   Florence, Kentucky.                     Estate Services LLC

The Debtors' proposed counsel, Pauline K. Morgan, Esq., at Young
Conaway Stargatt & Taylor LLP, in Wilmington, Delaware, explains
that the Properties were marketed by skilled brokers; are not
core components of the Debtors' long-range business strategy; and
are an economic burden.

"The elimination of liabilities associated with the Properties,
in addition to the value to be realized by the estates through
the sale of the Properties, is beneficial to the Debtors,
estates, and creditors," Ms. Morgan said.

Ms. Morgan also contended that an auction is not necessary because
it would be costly and impractical given the value to be
received.

"The proposed sales involve Buyers that are ready, willing and
able to close," Ms. Morgan argued.

Ms. Morgan noted that the Properties are clear of all liens;
satisfies Section 363(f) of the Bankruptcy Code; and are being  
sold in "good faith" under Section 363(m).

Additionally, the Debtors sought authorization from the Court to
pay the local brokers their commissions aggregating $209,500.  
Ms. Morgan maintains that the Local Brokers' fee commissions are
well within the range customarily found in similar real estate
transactions.

Headquartered in Eagan, Minnesota, Buffets Holdings Inc. --
http://www.buffet.com/-- is the parent company of Buffets,
Inc., which operates 626 restaurants in 39 states, comprised of
615 steak-buffet restaurants and eleven Tahoe Joe's Famous
Steakhouse restaurants, and franchises sixteen steak-buffet
restaurants in six states.  The restaurants are principally
operated under the Old Country Buffet, HomeTown Buffet, Ryan's and
Fire Mountain brands.  Buffets, Inc. employs approximately 37,000
team members and serves approximately 200 million customers
annually.

The company and all of its subsidiaries filed Chapter 11
protection on Jan. 22, 2008 (Bankr. D. Del. Case Nos. 08-10141 to
08-10158).  Joseph M. Barry, Esq., and Pauline K. Morgan, Esq., at
Young Conaway Stargatt & Taylor LLP, represent the Debtors in
their restructuring efforts.  The Debtors selected Epiq Bankruptcy
Solutions LLC as claims and balloting agent.  The U.S Trustee for
Region 3 appointed seven creditors to serve on an Official
Committee of Unsecured Creditors.  The Committee selected
Otterbourg Steindler Houston & Rosen PC as counsel.  The Debtors'
balance sheet as of Sept. 19, 2007, showed total assets of
$963,538,000 and total liabilities of $1,156,262,000.

As reported in the Troubled Company Reporter on Feb. 26, 2008,
the Court granted on February 22, 2008, final approval of the
Debtors' debtor-in-possession credit facility, consisting of
$85 million of new funding and $200 million carried over from the
company's prepetition credit facility. (Buffets Holdings
Bankruptcy News, Issue No. 15; Bankruptcy Creditors' Service Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).   


CABLEVISION SYSTEMS: Moody's Rtngs. Unmoved by Pending Acquisition
------------------------------------------------------------------
Moody's Investors Service commented that the short-term liquidity
profile for Cablevision Systems Corporation and its wholly-owned
indirect subsidiary Rainbow National Services LLC could be
weakened -- potentially materially -- if the company is unable to
access the capital markets and pre-fund at least some of its near-
term financing needs following a string of recent acquisition-
related announcements and disclosures.  However, because Moody's
believes there is a reasonable chance that Cablevision will be
successful in improving its liquidity, current ratings and
outlooks are not affected by the pending acquisitions.  Both
Cablevision and Rainbow have Ba3 corporate family ratings with
stable outlooks, and SGL-3 and SGL-1 liquidity ratings,
respectively.

On May 12, 2008, Cablevision announced plans to acquire an
approximate 97% interest in Newsday Media Group, a publisher of
the daily newspaper Newsday that serves Long Island and the
broader New York metropolitan area, along with other local
publications in a transaction valued at $650 million.  This
announcement followed the previous week's announcement by Rainbow
Media Holdings LLC, a subsidiary of Cablevision and the parent of
Rainbow, which agreed to acquire Sundance Channel for total
consideration of approximately $500 million.  

Also recently disclosed were an incremental $830 million of
planned capital expenditures (albeit likely to be incurred over a
more extended period) to support the upgrade and refurbishment of
Madison Square Garden and to build out a wireless broadband
network.  In consideration of the company's scheduled debt
maturities and proforma for the reported $650 million bank
financing commitment arranged to support the Newsday acquisition,
current cash balances and projected free cash flow, along with
availability under existing committed lines of credit will likely
not be sufficient to satisfy these capital requirements.

The companies have generally outperformed their peer groups and
are broadly seen to be rounding out their media holdings as much
(if not more) from a defensive perspective as an offensive one.  
As long as the balance sheets remain relatively healthy and
financial flexibility remains intact, Moody's views the ongoing
investment initiatives as credit-neutral (if not favorable).  
Indeed, Moody's expects the modest negative impact of the two
acquisitions on the company's credit metrics will be offset by
opportunities to generate incremental revenue and realize cost
synergies, although these will arguably not likely inure to the
benefit of creditors holding the company's rated debt instruments
given the unrestricted nature of such investments and the tax-
driven structure being effected.

Moody's Senior Vice President Russell Solomon says,
"notwithstanding the potential benefits of adding complementary
media and publishing businesses to the existing asset base and
their relatively modest impact on key credit metrics, the
incremental capital spending requirements exacerbate the company's
refinancing risk, particularly in the context of significantly
large debt repayments already scheduled to occur over the next 12-
to-18 months."

Moody's notes that approximately $635 million and $25 million of
requisite debt repayments are scheduled for the next twelve months
ending 3/31/2009 for Cablevision's CSC Holdings restricted group
and Rainbow, respectively.  And another $1.4 billion comes due
after that in 2009. At 1Q 2008, Cablevision had $399 million of
unrestricted cash, and $1 billion and $300 million, respectively,
of revolving lines of credit at the Cablevision restricted group
and Rainbow, which were both largely unutilized.  Absent a
sufficiently large refinancing, the liquidity profile for both
Cablevision and Rainbow is likely to become strained due to
substantially large utilization of the two committed revolving
lines of credit over the near-term.

Alternatively, if the companies are able to cover their near-term
funding needs by raising new money, as expected, and subsequently
free-up availability under their respective revolvers and
replenish current cash balances that will otherwise likely be
needed to effect the pending acquisitions, then their respective
liquidity positions will indeed remain intact and their SGL and
corporate family ratings will subsequently also likely remain
unchanged.

Headquartered in Bethpage, New York, Cablevision Systems
Corporation is predominantly a domestic cable multiple system
operator serving more than 3 million subscribers in and around the
metropolitan New York area.

Rainbow National Services LLC, headquartered in Jericho, New York,
supplies television programming to cable television and direct
broadcast satellite providers throughout the United States.  The
company predominantly operates three entertainment programming
networks, American Movie Classics, WE: Women's Entertainment, and
The Independent Film Channel.


CAPITAL AUTO: S&P Puts 'BB' Rating on $7.915MM Subordinate Notes
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its ratings to Capital
Auto Receivables Asset Trust 2008-2's $1.575 billion asset-backed
notes series 2008-2.

The ratings reflect:
     -- The credit quality of the underlying pool, which has a
        weighted average FICO score of 717.17 and consists of
        prime automobile loans;

     -- The timely interest and principal payments made under
        stressed cash flow modeling scenarios that are consistent
        with the ratings assigned to each class of notes;

     -- The credit enhancement; and
     -- The sound legal structure.

   
                          Ratings Assigned
           Capital Auto Receivables Asset Trust 2008-2
   
        Class     Rating   Type   Interest rate    Amount
        -----     ------   ----   -------------    ------
        A-1*      A-1+     Senior    Fixed       $285,000,000
        A-2a      AAA      Senior    Fixed       $100,000,000
        A-2b      AAA      Senior    Floating    $400,000,000
        A-3a      AAA      Senior    Fixed       $320,000,000
        A-3b      AAA      Senior    Floating    $200,000,000
        A-4       AAA      Senior    Fixed       $187,002,000
        B**       A        Sub       Fixed        $51,448,000
        C**       BBB      Sub       Fixed        $23,746,000
        D**       BB       Sub       Fixed         $7,915,000
   

* The class A-1 notes were sold in one or more private placements.

** The class B, C, and D notes may be initially retained by the
depositor or sold in one or more private placements.

Sub  -- Subordinate.


CDC COMMERCIAL: Moody's Holds B3 Rating on $3.187MM Class P Certs.
------------------------------------------------------------------
Moody's Investors Service upgraded the ratings of four classes and
affirmed the ratings of 13 classes of CDC Commercial Mortgage
Trust 2002-FX1, Commercial Mortgage Pass-Through Certificates,
Series 2002-FX1 as:

  -- Class A-1, $98,742,740, Fixed, affirmed at Aaa
  -- Class A-2, $304,897,000, Fixed, affirmed at Aaa
  -- Class X-CL, Notional, affirmed at Aaa
  -- Class X-CP, Notional, affirmed at Aaa
  -- Class B, $25,499,000, Fixed, affirmed at Aaa
  -- Class C, $9,562,000, Fixed, affirmed at Aaa
  -- Class D, $20,719,000, Fixed, affirmed at Aaa
  -- Class E, $7,968,000, Fixed, affirmed at Aaa
  -- Class F, $7,969,000, Fixed, upgraded to Aaa from Aa2
  -- Class G, $12,750,000, WAC, upgraded to Aa2 from A1
  -- Class H, $9,562,000, WAC, upgraded to A1 from A3
  -- Class J, $14,344,000, Fixed, upgraded to Baa2 from Baa3
  -- Class K, $12,749,000, Fixed, affirmed at Ba2
  -- Class L, $6,375,000, Fixed, affirmed at Ba3
  -- Class M, $4,781,000, Fixed, affirmed at B1
  -- Class N, $3,985,000, Fixed, affirmed at B2
  -- Class P, $3,187,000, Fixed, affirmed at B3

Moodys is upgrading classes F, G, H and J due to a significant
increase in the percentage of defeased loans as well as increased
credit support.

As of the April 17, 2008 distribution date, the transaction's
aggregate balance has decreased by approximately 12.6% to $557.4
million from $637.5 million at securitization.  The Certificates
are collateralized by 50 mortgage loans ranging in size from less
than 1.0% to 14.8% of the pool, with the top ten loans
representing 63.9% of the pool.  Nineteen loans, representing
60.1% of the pool, have defeased and are collateralized by U.S.
Government securities.  Two loans have been liquidated from the
pool resulting in a realized loss of approximately $838,000.  
There are no loans in special servicing and eleven loans,
representing 10.1% of the pool, are on the master servicer's
watchlist.

Moody's was provided with full year 2006 operating results for
99.6% of the performing loans and full- or partial- year 2007
operating results for 99.6% of the performing loans.  Moody's loan
to value ratio is 84.7%, compared to 84.3% at last review and
compared to 82.3% at securitization.

The top three non-defeased loans represent 19.0% of the pool.  The
largest loan is the Seattle Supermall Loan ($58.3 million -
10.5%), which is secured by a 935,000 square foot retail center
located in Auburn, Washington.  The property is 95.5% occupied,
compared to 89.0% at securitization.  Major tenants include Sam's
Club (16.5% GLA; lease expiration May 2019), Burlington Coat
Factory (9.2% GLA; lease expiration January 2011) and Gart Sports
(8.1% GLA; lease expiration January 2011).  Moody's LTV is 75.7%,
compared 76.2% at last review and 82.4% at securitization.

The second largest loan is the Marriott Islandia Loan
($25.5 million - 4.6%), which is secured by a 278-room full
service hotel located in Islandia (Suffolk County), New York.  
Performance has declined since securitization. Full-year 2007
financials indicate that RevPAR was $91.10, compared to $92.90 at
last review and $107.00 at securitization.  The loan has amortized
by approximately 9.6% since securitization.  The loan is on the
master servicer's watchlist due to low debt service coverage.  
Moody's LTV is 103.5%, compared to 89.3% at last review and 73.8%
at securitization.

The third largest loan is the Grand Avenue Loan ($22.0 million --
4.0%) which is secured by a 100,240 square foot strip retail
center located on Grand Avenue in a mixed-use neighborhood in
Queens, NY.  The center is anchored by a Stop and Shop (47.8% of
the GLA; lease expiring 2022), and twelve in-line tenants.  As of
January 2008, the property was 89.7% occupied, compared to 95.7%
at last review and compared to 100% at securitization.  Moody's
LTV is 86.5%, compared to 84.8% at last review and compared to
87.5% at securitization.  The increase in LTV can be attributed to
the recent jump in the vacancy rate and an increase in operating
expenses.


CENTERSTAGING MUSICAL: Seeks to Hire Lewis Landau as Counsel
------------------------------------------------------------
CenterStaging Musical Productions, Inc. asks the U.S. Bankruptcy
Court for the Central District of California for authority to
employ Lewis R. Landau as its general bankruptcy counsel.

The Debtor says that the general bankruptcy counsel's services are
required to represent the Debtor as a debtor-in-possession in
fulfilling its duties under sections 1106 and 1107 of the U.S.
Bankruptcy Code.  The general bankruptcy counsel's services will
include all legal services required to assist the Debtor in
fulfilling its duties, including all contested matters but
excluding corporate, tax and securities-related services.

The Debtor states that, to the best of its knowledge, Mr. Landau
is a disinterested person as that term is defined under Section
101(14) of the U.S. Bankruptcy Code, and has no interest adverse
to the Debtor, its creditors or the estate.

Mr. Landau's hourly rate is $400 per hour.  His paralegal support
Linda Landau bills at $140 per hour.  Mr. Landau charges for
third-party cost reimbursement and not for office expenses.

The Debtor has paid Mr. Landau $5,000 on Feb. 5, 2008, to commence
legal services.  The source of this payment was the Debtor's
operations.  On March 5, 2008, the Debtor paid Mr. Landau an
additional $25,000 for chapter 11 legal services plus an
additional $10,000 that Mr. Landau immediately transferred to
Biggs & Co. for accounting services.  The direct source of the
second payment was the Debtor, bu the liquidity for such payment
was a concurrent $115,000 loan by Bridgepointe Master Fund, LLC to
the Debtor.  Mr. Landau fully earned $30,000 in fees and costs
prior to the filing of the petition, which amount was applied from
the retainer deposit.  Mr. Landau has waived any excess amount due
from the Debtor for pre-petition work and is not a creditor of the
Debtor.

Headquartered in Burbank, California, CenterStaging Musical
Productions, Inc. -- http://www.centerstaging.com/-- is a    
rehearsal and production services company that provides production
support for most of the live television award shows like the
Academy Awards and the Grammy Awards.  The company also is a
production-support provider for TV shows such as "The Late Show
With David Letterman," "The Tonight Show With Jay Leno" and "Late
Night With Conan O'Brien."  The company filed for Chapter 11
protection on March 10, 2008 (Bankr. C.D. Calif. Case No. 08-
13019).  Lewis R. Landau, Esq., in Calabasas, California,
represents the Debtor.


CENTERSTAGING MUSICAL: Can Employ Biggs & Co. as Accountant
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Central District of California
granted CenterStaging Musical Productions, Inc. permission to
employ Biggs & Co. as accountant.

The Debtor said it requires the services of certified public
accountants experienced in bankruptcy to prepare and file federal
and state tax returns, prepare bankruptcy estate accounting
incident, among other functions.

Biggs & Co. attests that it does not represent or hold any
interest adverse to the Debtor or its estates, and that the firm
is a "disinterested person" as such term is defined in
Section 101(14) of the bankruptcy code.

It is contemplated that Biggs will seek compensation based upon
its normal usual hourly billing rates.

                           Rate Schedule

        Samuel R. Biggs, Partner  
           Regular Work                    $350.00
           Depositions and Court Testimony $400

        Charles E. Kunz, Partner  
           Regular Work                    $275.00
           Depositions and Court Testimony $400

        John E. Sullivan, Partner
           Regular Work                    $275.00
           Depositions and Court Testimony $365

         Samuel Okstad, Partner            $250
         Erin Rose, Manager                $175
         Lisa Nuzzi, Manager               $175
         Manager/Supervisor Accountants    $150.00-225.00
         Senior and Junior Accountants     $95-150.00
         Paraprofessionals                 $50-100.00

There has been no written or oral agreement of employment and/or
compensation between Biggs and Debtor.  However, Biggs received a
pre-petition retainer of $10,000 of which $1,295 was applied
toward fees earned in assisting the Debtor with its bankruptcy
filing.  The $8,705 balance of unearned fess will be held in
Biggs' client trust account as a security deposit toward fees
approved and allowed to be paid subject to approval of the court.

Headquartered in Burbank, California, CenterStaging Musical
Productions, Inc. -- http://www.centerstaging.com/-- is a    
rehearsal and production services company that provides production
support for most of the live television award shows like the
Academy Awards and the Grammy Awards.  The company also is a
production-support provider for TV shows such as "The Late Show
With David Letterman," "The Tonight Show With Jay Leno" and "Late
Night With Conan O'Brien."  The company filed for Chapter 11
protection on March 10, 2008 (Bankr. C.D. Calif. Case No. 08-
13019).  Lewis R. Landau, Esq., in Calabasas, California,
represents the Debtor.


CENTERSTAGING MUSICAL: U.S. Trustee Forms Three-Member Committee
----------------------------------------------------------------
The United States Trustee for Region 16 named three creditors as
members of the Official Committee of Unsecured Creditors in  
CenterStaging Musical Productions, Inc.'s chapter 11 case filed
with the U.S. Bankruptcy Court for the Central District of
California.  The three committee members are:

   1. Jeffrey Sumpter
      c/o Stonefield Josephson, Inc.
      2049 Century Park East, #400
      Los Angeles, CA 90067-9467
      Phone: (3100 453 9400
      Fax: (310) 453-1187

   2. Stanley J. Andrade
      c/o Andrade Architects, Inc.
      2880 S. Coast Highway
      Laguna Beach, CA 92651
      Phone: (949) 715 7474
      Fax: (949) 715-7475

   3. Robert Philpot
      16030 Ventura Blvd. #380
      Encino, CA 91436
      Phone: (818) 905-9500
      Fax: (818) 905-6823

Official creditors' committees have the right to employ legal
and accounting professionals and financial advisors, at the
Debtors' expense.  They may investigate the Debtors' business and
financial affairs.  Importantly, official committees serve as
fiduciaries to the general population of creditors they represent.  
Those committees will also attempt to negotiate the terms of a
consensual Chapter 11 plan -- almost always subject to the terms
of strict confidentiality agreements with the Debtors and other
core parties-in-interest.  If negotiations break down, the
Committee may ask the Bankruptcy Court to replace management with
an independent trustee.  If the Committee concludes reorganization
of the Debtor is impossible, the Committee will urge the
Bankruptcy Court to convert the Chapter 11 cases to a liquidation
proceeding.

               About CenterStaging Musical

Headquartered in Burbank, California, CenterStaging Musical
Productions, Inc. -- http://www.centerstaging.com/-- is a    
rehearsal and production services company that provides production
support for most of the live television award shows like the
Academy Awards and the Grammy Awards.  The company also is a
production-support provider for TV shows such as "The Late Show
With David Letterman," "The Tonight Show With Jay Leno" and "Late
Night With Conan O'Brien."  The company filed for Chapter 11
protection on March 10, 2008 (Bankr. C.D. Calif. Case No. 08-
13019).  Lewis R. Landau, Esq., in Calabasas, California,
represents the Debtor.


CHESAPEAKE CORP: Obtains $250MM Replacement Facility from GECC
--------------------------------------------------------------
Chesapeake Corp. disclosed in its financial report for the first
quarter of 2008 that on May 2, 2008, the company entered into a
commitment letter with GE Commercial Finance Limited and General
Electric Capital Corporation to act as the lead arranger and
underwriter to provide a $250 million senior secured credit
facility to refinance outstanding borrowings under the company's
2004 senior revolving credit facility.

The 2004 senior revolving credit facility, as amended, matures in
February 2009.  The company can borrow up to $250 million under
the 2004 Credit Facility.

Amounts available under the 2004 Credit Facility are limited by
the amount currently borrowed and the amounts of outstanding
letters of credit.  The Credit Facility is collateralized by a
pledge of the inventory, receivables, intangible assets and other
assets of Chesapeake Corporation and certain U.S. subsidiaries,
and is guaranteed by Chesapeake Corporation, each material U.S.
subsidiary and each United Kingdom subsidiary borrower, although
most U.K. subsidiary borrowers only guarantee borrowings made by
U.K. subsidiaries.  Obligations of our U.K. subsidiary borrowers
under the Credit Facility are collateralized by a pledge of the
stock of our material U.K. subsidiaries.  

On March 5, 2008, the company obtained agreement from a majority
of the lenders under the 2004 senior revolving credit facility to
amend the facility.  The amendment affects financial maintenance
covenants in all four quarters of fiscal 2008, providing an
increase in the total leverage ratios and a decrease in the
interest coverage ratios. In addition, interest rates were
increased to 450 basis points over LIBOR and basket limitations
were imposed for acquisitions, dispositions and other
indebtedness, among other changes.  

The amendment also stipulated that in the event that the senior
revolving credit facility was not fully refinanced prior to
March 31, 2008, the company would provide a security interest in
substantially all tangible assets of its European subsidiaries.
Activities are currently underway by the lenders under the senior
revolving credit facility to obtain security interests in certain
of the company's assets, primarily in the U.K. and Ireland.

The company was in compliance with all of its debt covenants as of
the end of the first quarter of fiscal 2008. However, based on
current projections the company may not be in compliance with the
financial covenants under the senior revolving credit facility at
the end of the second quarter of fiscal 2008. The company expects
to avoid compliance issues with these financial covenants by
improving cash flows, reducing outstanding indebtedness, replacing
or amending the senior revolving credit facility or obtaining
waivers from the lenders, but there can be no assurance that these
alternatives will be successfully implemented.

Failure to comply with the financial covenants would be an event
of default under the senior revolving credit facility. If such an
event of default were to occur, the lenders under the senior
revolving credit facility could require immediate payment of all
amounts outstanding under the facility and terminate their
commitments to lend under the facility. Pursuant to cross-default
provisions in many of the instruments that govern the company's
other outstanding indebtedness, immediate payment of much of the
other outstanding indebtedness could be required, all of which
would have a material adverse effect on the business, results of
operations and financial condition.

Outstanding borrowings under the Credit Facility as of March 30,
2008 totaled $185.2 million.

                 $250-Mil. GECC Replacement Loan

The Company and its U.K. subsidiary, Chesapeake plc, entered into
a commitment letter with the GE Entities on May 2, 2008.  The
Facility will consists of a U.K. credit facility in an aggregate
amount up to $235 million and a U.S. credit facility in an
aggregate amount up to $15 million.  

The GE Credit Facilities will refinance and replace the Company's
Credit Facility which matures in February 2009.  The GE Credit
Facilities are expected to include revolving credit and term loans
secured, in the case of the U.K. credit facility, by substantially
all of the assets of Chesapeake plc and its material operating
subsidiaries in the U.K. and the Republic of Ireland and in
addition certain assets of its material operating subsidiaries in
Europe and, in the case of the U.S. credit facility, certain
assets of the Company and substantially all of the assets of
certain of its material U.S. operating subsidiaries.

The commitment letter is subject to a number of conditions that
must be satisfied before the GE Credit Facilities documents are
finalized and the lenders' commitment is funded.  

While the Company anticipates it will close on the refinancing
before the end of June 2008, there can be no assurances that such
closing will occur.

The company believes that the current Credit Facility and the GE
Credit Facilities will give it adequate financial resources to
support the company's anticipated long-term and short-term capital
needs and commitments.

If the Company is unable to refinance the Credit Facility by
February 2009, all amounts outstanding under the Credit Facility
will become payable and, pursuant to cross-default provisions in
many of the instruments that govern the company's other
outstanding indebtedness, immediate payment of much of its other
outstanding indebtedness could be required, all of which would
have a material adverse effect on its business, results of
operations and financial condition.

                 About Chesapeake Corporation

Headquartered in Richmond, Virginia, Chesapeake Corporation
(NYSE:CSK) -- http://www.cskcorp.com/-- is a supplier of    
specialty paperboard packaging products in Europe and an
international supplier of plastic packaging products to niche
end-use markets.  Chesapeake has 47 locations in France,
Ireland, United Kingdom, North America, China, HongKong, among
others and employs approximately 5,500 people.  

For the quarter ended March 30, 1008, the company reported
$1,225,100,000 in total assets and $948,100,000 in total
liabilities.


CHESAPEAKE CORP: In Talks to Amend U.K. Pension Recovery Plan
-------------------------------------------------------------
Chesapeake Corp. disclosed in its most recent quarterly report
that one of the company's U.K. subsidiaries is party to a recovery
plan for its U.K. pension plan.

The subsidiary is required to make annual cash contributions
to the U.K. Pension Plan in July of each year of at least
GBP6 million above otherwise required levels to achieve a funding
level of 100 percent by July 2014.

The company has received the April 2008 valuation of the U.K.
Pension Plan's assets and liabilities prepared by the actuarial
advisors for the U.K. Pension Plan's Trustee, which included the
actuary's calculation of the additional supplementary contribution
due under the current Recovery Plan in July 2008 to achieve 90
percent funding.  The actuary's report indicates a total plan
funding shortfall (under the terms of the plan on an ongoing
basis) of approximately GBP58.9 million as of April 5, 2008.  A
funding shortfall of that amount will result, under the terms of
the current Recovery Plan, in a July 2008 supplementary
contribution to the U.K. Pension Plan of GBP35.6 million
(including the scheduled annual supplementary payment of
GBP6 million).

In the joint letter to the U.K. Pensions Regulator, management of
the company's U.K. subsidiary stated its concern that the July
2008 additional supplementary contribution under the Recovery Plan
could exceed its then-current estimate of GBP21 million (including
the scheduled annual supplementary payment of GBP6 million), which
it might be unable to pay without breaching certain financial
covenants in the company's Credit Facility or likely to be
included in any refinancing thereof, and that any such breach
would trigger cross-defaults under substantially all of the
company's other debt.

The Trustee for the U.K. Pension Plan stated in the letter, among
other things, that it was committed to working with the subsidiary
to secure funding for the plan in accordance with the statutory
funding objective, while recognizing that maintaining a
financially healthy employer is in the best interests of the U.K.
Pension Plan.  The Trustee acknowledged to the U.K. Pensions
Regulator that the subsidiary will find it difficult to make any
significant cash payment under the Recovery Plan currently, or in
the near future.

               Amendments to Recovery Plan Eyed

The company negotiated with the Trustee regarding possible
amendments to the Recovery Plan which will modify the obligations
with respect to the requirement in the Recovery Plan for
additional supplementary contributions to achieve 90 percent
funding as at April 5, 2008, and still comply with statutory
requirements.  In the course of those negotiations, the company
confirmed to the Trustee that its U.K. subsidiary will be unable
to pay the now-determined July 2008 additional supplementary
contribution of GBP29.6 million (the excess over the July 2008
annual payment of GBp6 million) under the current Recovery Plan
without breaching certain financial covenants in our existing
senior revolving credit facility or likely to be included in any
refinancing thereof, and that any such breach would trigger cross-
defaults under substantially all of the company's other debt.

The company also noted that failure to pay amounts due under the
current Recovery Plan could ultimately result in a winding-up of
the U.K. Pension Plan, triggering a payment required by statute
calculated on a "buy out" basis (estimated to be GBP159.3 million
as of April 2008).  All of the above would have a material adverse
effect on the company's business, results of operations and
financial condition.

The company has reached preliminary agreement with the Trustee on
the principles of amendments to the Recovery Plan which will
reduce the supplemental payment due on or before July 15, 2008 to
GBP6 million, and provide additional assurance of, and security
for, our future funding of the plan.  The company believes the
amounts payable under the proposed amended recovery plan can be
paid without the Company breaching relevant financial covenants.

The company and the Trustee are in the process of finalizing the
terms of the Amended Recovery Plan and will seek any appropriate
approvals required for the Amended Recovery Plan. While there can
be no assurance that the Recovery Plan will be amended and
approved, the company expects to finalize the Amended Recovery
Plan prior to the July 15, 2008 payment date.

                       Credit Facility

The company is a party to a $250 million credit facility, as
amended, which matures in February 2009.  Outstanding borrowings
under the Credit Facility as of March 30, 2008, totaled $185.2
million.

The company was in compliance with all of its debt covenants as of
the end of the first quarter of fiscal 2008. However, based on
current projections the company may not be in compliance with the
financial covenants under the senior revolving credit facility at
the end of the second quarter of fiscal 2008.

On May 2, 2008, the company entered into a commitment letter with
GE Commercial Finance Limited and General Electric Capital
Corporation to act as the lead arranger and underwriter to provide
a $250 million senior secured credit facility to refinance
outstanding borrowings under the company's 2004 senior revolving
credit facility that matures in February 2009.

While the Company anticipates it will close on the refinancing
before the end of June 2008, there can be no assurances that such
closing will occur.

                 About Chesapeake Corporation

Headquartered in Richmond, Virginia, Chesapeake Corporation
(NYSE:CSK) -- http://www.cskcorp.com/-- is a supplier of    
specialty paperboard packaging products in Europe and an
international supplier of plastic packaging products to niche
end-use markets.  Chesapeake has 47 locations in France,
Ireland, United Kingdom, North America, China, HongKong, among
others and employs approximately 5,500 people.  

For the quarter ended March 30, 1008, the company reported
$1,225,100,000 in total assets and $948,100,000 in total
liabilities.


CHRYSLER LLC: Reaches Tentative Settlements with CAW Officials
--------------------------------------------------------------
The Canadian Auto Workers union reached tentative settlements with
both General Motors Corp. and Chrysler LLC that meet the pattern
established with Ford Motor Co.  The CAW represents close to
13,000 GM workers and 8,000 Chrysler workers in Canada.

As reported in the Troubled Company Reporter on May 7, 2008, for
the first time in its history, Ford Motor Company of Canada,
Limited reached a collective bargaining agreement with CAW more
than four months before the current contract expires.  Ford
employees represented by the CAW ratified the new deal in a vote
held May 4, 2008.  The early settlement brings stability to Ford's
operations as it prepares to launch the new Ford Flex crossover
vehicle at the Oakville Assembly Complex, which also builds the
Ford Edge and Lincoln MKX.  Ford disclosed plans to add 500
positions to increase production at the Oakville plant due to high
demand for the Ford Edge and Lincoln MKX, and to prepare for the
start of production of the Ford Flex.

According to a CAW press statement, both settlements were
unanimously endorsed by the CAW/GM and CAW/Chrysler Master
Bargaining committees, respectively and later overwhelmingly
supported by local union leadership.

The three-year agreements resist two-tier wages and provide
productivity and quality bonuses, improved restructuring
incentives, benefit improvements, COLA increases in both second
and third years and improved language on health and safety issues
among other gains.

The union negotiated new product commitments for both Oshawa car
and St. Catharines facilities as well as a strong close-out
agreement for members at the GM Windsor Transmission plant.  
During bargaining the company announced that the Windsor plant
will close in 2010.

The union also extended the operating life of the Chrysler Casting
plant in Etobicoke, Ontario, at least until 2011.

The tentative settlements are subject to ratification by CAW
members.  Ratification meetings will be held at various GM and
Chrysler locations on Friday, May 16 and Saturday, May 17, 2008.  
CAW media advisories will be issued after the ratification votes
are counted at each company providing details of the results.

Ratification meeting dates, times and locations are:

  * CAW General Motors units

    -- Friday, May 16

       1) Local 1973
          Ciociaro Club, Salons A,B,C
          3745 N. Talbot Road
          Windsor, ON
          9:00am

       2) Local 199
          Brock University
          Bob Davis Gym
          500 Glenridge Ave
          St. Catharines, ON
          12:00 noon

       3) Local 222
          General Motors Centre
          99 Athol Street E.,
          Oshawa, ON
          3:00pm

    -- Saturday, May 17

       1) Local 636
          Local 636 Union Hall
          126 Beale Street
          Woodstock, ON
          9:30am

   * CAW Chrysler units

     -- Saturday, May 17

        1) Local 195
           CAW Local 195 Hall
           3400 Somme Avenue
           Windsor, ON
           7:00am, 1:00pm, 3:00pm

        2) Local 1459
           SCA Oplenac
           895 Rangeview Road
           Mississauga, ON
           (S. of Lakeshore, between Cawthra & Dixie)
           8:00am

        3) Local 1498
           CAW Local 444 union hall
           1855 Turner Road
           Windsor, ON
           10:00am

        4) Local 1285
           International Centre, Hall #1
           6900 Airport Road
           (Airport & Derry Road)
           Mississauga, ON
           10:30am

        5) Local 444
           University of Windsor
           401 Sunset Avenue
           St. Denis Hall
           Windsor, ON
           2:00pm

                           About Ford

Headquartered in Dearborn, Michigan, Ford Motor Co. (NYSE: F) --
http://www.ford.com/-- manufactures or distributes automobiles in
200 markets across six continents.  With about 260,000 employees
and about 100 plants worldwide, the company's core and affiliated
automotive brands include Ford, Jaguar, Land Rover, Lincoln,
Mercury, Volvo, Aston Martin, and Mazda.  The company provides
financial services through Ford Motor Credit Company.

The company has operations in Japan in the Asia Pacific region.
In Europe, the company maintains a presence in Sweden, and the
United Kingdom.  The company also distributes its brands in
various Latin American regions, including Argentina and Brazil.

                          About GM

Headquartered in Detroit, Michigan, General Motors Corp. (NYSE:
GM) -- http://www.gm.com/-- was founded in 1908.  GM employs
about 266,000 people around the world and manufactures cars and
trucks in 35 countries.  In 2007, nearly 9.37 million GM cars and
trucks were sold globally under the following brands: Buick,
Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel,
Pontiac, Saab, Saturn, Vauxhall and Wuling.  GM's OnStar
subsidiary is the industry leader in vehicle safety, security and
information services.

                           About Chrysler

Headquartered in Auburn Hills, Michigan, Chrysler LLC --
http://www.chrysler.com/-- a unit of Cerberus Capital
Management LP, produces Chrysler, Jeep(R), Dodge and Mopar(R)
brand vehicles and products.  The company has dealers worldwide,
including Canada, Mexico, U.S., Germany, France, U.K.,
Argentina, Brazil, Venezuela, China, Japan and Australia.

                            *     *     *

As reported in the Troubled Company Reporter on May 9, 2008,
Fitch Ratings downgraded the Issuer Default Rating of Chrysler
LLC to 'B' from 'B+', with a Negative Rating Outlook.  Fitch has
also downgraded the senior secured bank facilities, including
senior secured first-lien bank loan to 'BB/RR1' from 'BB+/RR1';
and senior secured second-lien bank loan to 'CCC+/RR6' from
'BB+/RR1'.  The recovery rating on the second lien was also
downgraded from 'BB+/RR1' to 'CCC+/RR6' based on lower asset value
assumptions and associated recoveries in the event of a stress
scenario.


CIMAREX ENERGY: S&P Lifts Credit Rating to BB with Stable Outlook
-----------------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit and
senior unsecured ratings on Cimarex Energy Co. to 'BB' from 'BB-'.  
S&P maintained the recovery rating on the senior unsecured notes
of '3', indicating the likelihood of meaningful (50%-70%) recovery
in the event of a payment default.  The outlook is stable.

Cimarex had $487 million debt outstanding as of March 31, 2008.
     
"The upgrade reflects Cimarex's commitment to a fairly
conservative financial policy and, in particular, very low debt
leverage to offset its exposure to commodity price swings," said
Standard & Poor's credit analyst Paul Harvey.  "In addition,
Cimarex has successfully integrated its 2005 acquisition of Magnum
Hunter Resources, a concern that weighed on ratings.  Given the
very favorable outlook for hydrocarbon prices over the next 12
months, and increasing production, Cimarex should continue to
generate above-average financial measures for its rating."
     
Mr. Harvey also said, "We could raise the ratings if Cimarex can
maintain its strong financial measures while improving its
business profile.  We could lower the ratings if Cimarex pursues a
more aggressive financial policy and debt leverage exceeds 3.0x to
3.5x debt to EBITDA, considerately more than current levels."


CITIGROUP COMMERCIAL: Moody's Affirms Ba1 Rating on Class L Certs.
------------------------------------------------------------------
Moody's Investors Service upgraded one class and affirmed three
classes of Citigroup Commercial Mortgage Trust 2004-FL1,
Commercial Mortgage Pass-Through Certificates, Series 2004-FL1 as:

  -- Class K, $5,380,894, Floating, upgraded to A1 from Baa1
  -- Class L, $3,069,602, Floating, affirmed at Ba1
  -- Class X-2GMAC, Notional, affirmed at Aaa
  -- Class X-3GMAC-MULTI, Notional, affirmed at Aaa

Moody's is upgrading one class based on increased credit support
due to loan payoffs.

The Certificates are collateralized by two loans. As of the
April 15, 2008 distribution date, the transaction's aggregate
certificate balance has decreased by approximately 98.6% to
$8.5 million from $613.8 million at securitization as a result of
the payoff of 33 loans originally in the pool.

Jamestown Mall ($5.3 million -- 62.9%) is secured by a regional
mall containing 1.0 million square feet (308,000 square feet is
collateral) located in Florissant, Missouri, approximately 15
miles north of St. Louis.  The mall is anchored by Sears, Macy's,
and a J.C. Penney Outlet.  In-line occupancy is approximately 40%
compared to total occupancy of 73.2% at securitization.  The loan
is currently in special servicing.  The mall, which was managed by
General Growth Properties at last review, is now managed by Jones
Lang LaSalle.  The borrower has exercised the second of its two
one-year extension options and the loan matures June 1, 2008.  
Moody's current underlying rating is Ba1 compared to Baa1 at last
review and securitization.

Hensley Distribution Center ($3.1 million -- 37.1%) is secured by
a 125,000 square foot warehouse property located in Tempe,
Arizona.  The property is currently 100% vacant.  The tenant who
occupied the entire property, Hensley & Co. was a wholesaler for
Anheuser-Busch and vacated the property in March 2008 upon their
lease expiration.  The borrower has exercised the second of its
two one-year extension options and the loan matures Jan. 1, 2009.
The senior loan exposure is $25 per square foot. The property is
currently being marketed for sale by CB Richard Ellis with three
potential buyers.  Moody's current underlying rating is Aa2
compared to Baa3 at last review and securitization.


CITIGROUP COMMERCIAL: Moody's Cuts Rating to Caa1 on Class O Cert.
------------------------------------------------------------------
Moody's Investors Service downgraded the ratings of three classes
and affirmed the ratings of 23 classes of Citigroup Commercial
Mortgage Trust, Commercial Mortgage Pass-Through Certificates,
Series 2006-C5 as:

  -- Class A-1, $49,981,330, affirmed at Aaa
  -- Class A-2, $236,789,000, affirmed at Aaa
  -- Class A-3, $93,821,000, affirmed at Aaa
  -- Class A-SB, $92,770,000, affirmed at Aaa
  -- Class A-4, $774,252,000, affirmed at Aaa
  -- Class A-1A, $227,907,476, affirmed at Aaa
  -- Class A-M, $212,378,000, affirmed at Aaa
  -- Class A-J, $172,556,000, affirmed at Aaa
  -- Class XC, Notional, affirmed at Aaa
  -- Class XP, Notional, affirmed at Aaa
  -- Class B, $42,476,000, affirmed at Aa2
  -- Class C, $21,237,000, affirmed at Aa3
  -- Class D, $26,548,000, affirmed at A2
  -- Class E, $29,201,000, affirmed at A3
  -- Class F, $26,548,000, affirmed at Baa1
  -- Class G, $21,237,000, affirmed at Baa2
  -- Class H, $21,238,000, affirmed at Baa3
  -- Class J, $7,964,000, affirmed at Ba1
  -- Class K, $7,964,000, affirmed at Ba2
  -- Class L, $7,964,000, affirmed at Ba3
  -- Class M, $2,655,000, downgraded to B2 from B1
  -- Class N, $7,964,000, downgraded to B3 from B2
  -- Class O, $2,655,000, downgraded to Caa1 from B3
  -- Class AMP-1, $40,000,000, affirmed at Baa1
  -- Class AMP-2, $48,000,000, affirmed at Baa2
  -- Class AMP-3, $27,000,000, affirmed at Baa3

Moody's is downgrading Classes M, N and O due to an overall
decline in pool performance, LTV dispersion and projected losses
from specially serviced loans.

As of the April 17, 2008 distribution date, the transaction's
aggregate certificate balance has decreased by approximately 0.5%
to $2.23 billion from $2.24 billion at securitization.  The
Certificates are collateralized by 208 loans ranging in size from
less than 1.0% to 5.8% of the pool with the top 10 loans
representing 35.1% of the pool.  The pool includes two loans (9.3%
of the pool) with underlying ratings.

The trust has not realized any losses since securitization.
Currently there are five loans, representing 1.7% of the pool, in
special servicing.  Moody's has estimated a total loss of $9.4
million among these five loans.

Thirty-nine loans, representing 11.9% of the pool, are on the
master servicer's watchlist.  The master servicer's watchlist
includes loans which meet certain portfolio review guidelines
established as part of the Commercial Mortgage Securities
Association monthly reporting package.  As part of our ongoing
monitoring of a transaction, Moody's reviews the watchlist to
assess which loans have material issues that could impact
performance.  Not all loans on the watchlist are delinquent or
have significant issues.

Moody's was provided with year-end 2006 or year-end 2007, and
partial year 2007 operating results for 76.8% and 16.2% of the
pool, respectively.  Moody's weighted average loan to value ratio
for the conduit component is 107.0% compared to 104.4% at
securitization.  According to Moody's analysis, 17.8% of the
conduit pool has a LTV in excess of 120.0% compared to 6.7% at
securitization.

The largest loan with an underlying rating is the Tower 67 Loan
($100.0 million -- 4.7%), which is secured by a 449-unit high-rise
multifamily tower built in 1986, located in the Upper West Side
neighborhood of New York, NY.  The property was 95.0% occupied as
of December 2007 compared to 97.1% as of July 2006.  Both rents
and expenses at the property have increased since securitization.  
Moody's current underlying rating is A3, the same as at
securitization.

The second largest loan with an underlying rating is the Ala Moana
Portfolio Loan ($96.0 million -- 4.5%), which is secured by a 2.0
million square foot regional mall and office component. Located in
Honolulu, HI, the mall is dominant within its trade area and is
considered the world's largest open-air shopping center.  The
property recently underwent an expansion to include a 200,000
square foot Nordstrom department store as well as 100,000 square
feet of additional retail space.  The upside potential from the
expansion space, which opened for operation during 1Q2008, was
accounted for at securitization.  Moody's current underlying
rating is A3, the same as at securitization.

The top three conduit loans represent 14.8% of the outstanding
pool balance.  The largest conduit loan is the IRET Portfolio Loan
($122.6 million -- 5.8%), which is secured by nine crossed-
collateralized and cross-defaulted office properties located in
Nebraska (4), Missouri (2), Minnesota (2), and Kansas (1).  The
properties were built between 1982 and 2001 and total 936,720
square feet.  Major tenants at the properties include Applied
Underwriters (Berkshire Hathaway), Unigraphics Solutions, Hewlett
Packard, and Wachovia Insurance Services.  The portfolio occupancy
was 94.1% as of January 2008 compared to 95.7% at securitization.  
Moody's LTV is 110.2%, the same as at securitization.

The second largest conduit loan is the 801 South Figueroa Street
Loan ($120.0 million -- 5.7%), which is secured by a 443,271
square foot Class A office building located in the Los Angeles
CBD.  As of February 2008, the largest tenant (Federal Chubb
Insurance, 25.5% NRA) has vacated their space and thus far, the
borrower has released approximately 25% of that space.  The
property benefits from a strong location in a competitive market,
and will likely not sustain below-market occupancy.  Moody's LTV
is 144.4%, compared to 131.6% at securitization.

The third largest conduit loan is the NNN WellPoint Operations
Center Loan ($70.0 million -- 3.3%), which is secured by a 562,000
square foot Class A office building built in 2000, located in
downtown Indianapolis.  The property is 100% leased to WellPoint,
Inc. (senior unsecured Baa1) through July 2015 with one, five-year
extension option.  The loan matures July 2011.  Moody's LTV is
98.5%, the same as at securitization.


CLEAR CHANNEL: Inks Settlement Agreement with CC Media and Lenders
------------------------------------------------------------------
Clear Channel Communications, Inc., entities sponsored by Bain
Capital Partners, LLC and Thomas H. Lee Partners, L.P., and a bank
syndicate consisting of Citigroup Inc., Deutsche Bank AG, Morgan
Stanley, Credit Suisse Group, Royal Bank of Scotland PLC and
Wachovia Corp., have entered into a settlement agreement in
connection with the lawsuits previously filed in the Supreme Court
of the State of New York and the State Court in Bexar County,
Texas.

Pursuant to the terms of the settlement agreement, the parties
have agreed to enter into a third amendment to the merger
agreement.  Under the terms of the amended merger agreement, as
disclosed in the Troubled Company Reporter on May 14, 2008, Clear
Channel shareholders will receive $36.00 in cash for each share
they own.

As an alternative to receiving the $36.00 per share cash
consideration, Clear Channel's shareholders will again be offered
the opportunity on a purely voluntary basis to exchange some or
all of their shares of Clear Channel common stock on a one-for-one
basis for shares of Class A common stock in CC Media Holdings,
Inc., the new corporation sponsored by the private equity group to
acquire Clear Channel.  In limited circumstances, shareholders
electing to receive some or all cash consideration, on a pro rata
basis, will be issued shares of CC Media Holdings Class A common
stock in exchange for some of their shares of Clear Channel stock,
up to a cap of $1.00 per share.

Shareholders who elected to receive the stock consideration prior
to the special meeting of shareholders held Sept. 25, 2007, will
have their shares of Clear Channel stock returned to them and will
be required to make a new election prior to the new special
shareholders' meeting.  While the merger is expected to close by
the end of the third quarter 2008 pending shareholder approval,
the parties to the settlement agreement have agreed to extend the
outside date for completion of the merger to Dec. 31, 2008.

As part of the settlement agreement, the banks in the syndicate
supporting the transaction have entered into fully-negotiated and
documented definitive agreements to provide long-term financing to
Clear Channel.  The banks, the private equity investors, Clear
Channel, certain shareholders, and Bank of New York (serving as
escrow agent) have entered into an Escrow Agreement pursuant to
which the private equity investors and the banks have agreed to
fund into escrow the total amount of their respective equity and
debt obligations, in a combination of cash and letters of credit,
within ten and seven business days, respectively.  Certain
shareholders also have agreed to deposit into escrow securities of
Clear Channel that these parties have agreed to exchange for Class
A common stock of CC Media Holdings.  Following deposit of funds
and other property into escrow, each party to the merger related
litigation pending in New York and Texas will file all papers
necessary to terminate the litigation, with prejudice.

The board of directors of Clear Channel has unanimously approved
the amended merger agreement and recommends that the shareholders
approve the amended merger agreement and the merger.  The board of
directors of Clear Channel makes no recommendation with respect to
the voluntary stock election or the Class A common stock of the
new corporation.

The total number of Clear Channel shares that may elect to receive
shares in the new corporation will make up 30% of the new
corporation's equity and is expected to be roughly 30 million.  
These shares would have a total value of about $1.1 billion (at
the $36.00 per share cash consideration) and represent
approximately 30% of the outstanding capital stock of the new
corporation immediately following the closing of the merger.  The
terms of the merger agreement, as amended, provide that no
shareholder will be allocated more than 11,111,112 shares
representing an estimated 11% of the outstanding capital stock of
the new corporation immediately following the closing of the
merger.

If Clear Channel shareholders elect to receive more than the
allocated number of shares of the Class A common stock of the new
corporation, then the shares will be allocated to shareholders who
elect to receive them on a pro-rata basis.  Those Clear Channel
shareholders electing to receive shares of the new corporation
will receive $36.00 per share for any such Clear Channel shares
that are not exchanged in this manner.  The election process will
occur in connection with the shareholder vote on the merger, and
will be described fully in an updated proxy statement and
prospectus that will be mailed to Clear Channel shareholders.

The merger agreement, as amended, which will require shareholder
approval, includes provisions limiting the fees payable to the
private equity group in the transaction, and requiring that the
board of directors of the new corporation at all times include at
least two independent directors.

The shares of CC Media Holdings to be issued to Clear Channel
shareholders who elect to receive them in exchange for their
existing shares will be registered with the Securities and
Exchange Commission, but will not be listed on any national
exchange.

Goldman Sachs & Co. served as financial advisor to Clear Channel
on the transaction, and Akin Gump Strauss Hauer & Feld LLP served
as legal advisor to the company.

"We are very pleased to have reached this accord with our sponsors
and the banks funding the transaction," Mark P. Mays, the Chief
Executive Officer of Clear Channel, said.  "This revised agreement
is a win for our shareholders because it provides them with
substantial value and certainty while avoiding the delay and
inherent risks associated with complex litigation.  Our
shareholders will receive a significant premium over recent stock
price levels and can elect to continue to participate in our
future upside.  Importantly, this agreement greatly increases the
certainty that the merger will close because all debt and equity
funds will be deposited in escrow until the transaction closes.

"Clear Channel's business prospects will be enhanced further
through an improved capital structure that includes a lower debt
load.  We appreciate greatly the support of our shareholders as
well as the loyalty and hard work of our dedicated employees over
these many months.  We are eager to begin working with THL and
Bain Capital, the stellar team that will help us to fulfill our
considerable promise."

"We have been extremely pleased by our partnership with the Clear
Channel management team. We believe this agreement, and the
definitive long-term financing package the banks have agreed to
provide, offers clarity and confidence to Clear Channel's
customers, employees and partners," John P. Connaughton, a
Managing Director at Bain Capital, stated.  "We look forward to
supporting the continued global market leadership, growth and
success of the most innovative company in the radio broadcasting
and out-of-home media space."

"We are pleased to arrive at this resolution which enables us to
complete the acquisition of Clear Channel," Scott M. Sperling, Co-
President of THL Partners, said.  "We appreciate that the banks
have provided the company with the robust, long-term financing
that will allow Clear Channel to achieve its outstanding
operational and growth potential.  We would like to thank all of
the stakeholders who worked to achieve this positive outcome, and
we are looking forward to working closely with our investment
partners and with the entire Clear Channel leadership team to
execute on our plans to grow the company to its full potential."

A representative of the bank group, Chad Leat, Chairman of the
Alternative Asset Group at Citi, said: "The Banks are very pleased
to have reached a constructive resolution of the matter.  We look
forward to an expeditious closing of the revised transaction and
want to express our appreciation to all those who contributed to
the solution.  We look forward to participating with our partners
in Clear Channel's continued success."

In connection with its support of a settlement, Highfields Capital
Management LP, which manages funds that beneficially own 7.7% of
Clear Channel's common stock, extended its Voting Agreement with
entities sponsored by the private equity group.  Under the
Agreement, Highfields has agreed to vote in favor of the
transaction and to retain up to $400 million in equity of CC Media
Holdings.  Additionally, the Agreement includes provisions
assuring public shareholders who elect to receive stock in the
surviving entity that they will receive equal treatment to the
private equity investors in dividends and other distributions,
representation on the Board of Directors of the surviving entity
and have certain other rights following completion of the merger.

"As the largest shareholder in Clear Channel, we saw an
opportunity to bring all parties together to remove the risk and
uncertainty of litigation and we are glad that a constructive and
mutually beneficial business solution could be reached, Jonathon
S. Jacobson, Senior Managing Director of Highfields, said.  "We
fully support this revised transaction."

"Clear Channel can now accelerate the initiatives it has underway
to capitalize on the strength of its assets and drive
profitability," Richard L. Grubman, Senior Managing Director of
Highfields, added.  "We look forward to continuing to play a
meaningful role in ensuring the company is positioned to create
substantial long-term value."

Clear Channel will set a record date, time and place for a new
special meeting of shareholders after filing an updated joint
proxy statement or prospectus with the Securities and Exchange
Commission.

Shareholders with questions about the merger or how to vote their
shares should call Clear Channel's proxy solicitor, Innisfree M&A
Incorporated, toll-free at (877) 456-3427.

A full-text copy of the Amended Agreement and Plan of Merger is
available for free at http://ResearchArchives.com/t/s?2c08

                        About Clear Channel

Based in San Antonio, Texas, Clear Channel Communications Inc.
(NYSE:CCU) -- http://www.clearchannel.com/-- is a media
and entertainment company specializing in "gone from home"
entertainment and information services for local communities and
premiere opportunities for advertisers.  The company's
businesses include radio, television and outdoor displays. Outside
U.S., the company operates in 11 countries -- Norway,
Denmark, the United Kingdom, Singapore, China, the Czech
Republic, Switzerland, the Netherlands, Australia, Mexico and
New Zealand.  As of Dec. 31, 2007, it owned 717 core radio
stations, 288 non-core radio stations which are being marketed for
sale and a leading national radio network operating in the United
States.

                            *     *     *

In March 2008, Standard & Poor's Ratings Services said its
ratings on Clear Channel Communications Inc., including the 'B+'
corporate credit rating, remain on CreditWatch with negative
implications.

Fitch Ratings stated that in line with previous guidance, Clear
Channel Communications' 'BB-' Issuer Default Rating and Senior
Unsecured Ratings would remain in place if the going-private
transaction is not completed.

Moody's stated that assuming the transaction is completed as
currently contemplated, Clear Channel will likely be assigned a
Corporate Family Rating of B2 and the rating on the existing
senior notes is likely to be notched down to Caa1 based on their
expected subordination to the new senior secured debt facilities
and the new senior notes.


CLFX CORP: Full Payment of Debt Cues Moody's to Withdraw Ratings
----------------------------------------------------------------
Moody's Investors Service has withdrawn all of its ratings on CLFX
Corporation.  The ratings withdrawal follows the payment in full
of all outstanding senior secured bank debt under the credit
agreement dated as of May 30, 2003, which was terminated.

Ratings withdrawn:

  -- B1 corporate family rating
  -- B1 probability of default rating
  -- Ba3 senior secured term loans
  -- Ba3 senior secured revolver

CLFX Corporation, based in Richmond, Virginia, is a global
manufacturer of flow control products used in oil & gas, power
generation, marine and a variety of other applications.


COMM 2007-FL14: Stable Performance Cues Moody's to Hold Ratings
---------------------------------------------------------------
Moody's Investors Service upgraded three classes, downgraded three
classes and affirmed twenty-two classes of COMM 2007-FL14 as:

  -- Class A, $330,532,177, Floating, affirmed at Aaa
  -- Class A-J, $430,456,000, Floating, affirmed at Aaa
  -- Class B, $49,015,965, Floating, affirmed at Aa1
  -- Class C, $40,366,403, Floating, affirmed at Aa2
  -- Class D, $34,599,850, Floating, affirmed at Aa3
  -- Class E, $34,599,850, Floating, affirmed at A1
  -- Class F, $34,599,850, Floating, affirmed at A2
  -- Class G, $11,533,105, Floating, affirmed at A3
  -- Class H, $11,533,105, Floating, affirmed at Baa1
  -- Class J, $7,208,324, Floating, affirmed at Baa2
  -- Class K, $10,092,069, Floating, affirmed at Baa3
  -- Class GBL1, $15,317,178, Floating, affirmed at Baa2
  -- Class GBL2, $20,103,796, Floating, affirmed at Baa3
  -- Class GBL4, $12,445,207, Floating, affirmed at Ba1
  -- Class PG1, $4,000,000, Floating, affirmed at Baa1
  -- Class PG2, $6,000,000, Floating, affirmed at Baa2
  -- Class PG3, $6,000,000, Floating, affirmed at Baa3
  -- Class PG4, $5,400,000, Floating, affirmed at Ba1
  -- Class AOA1, $12,000,000, Floating, downgraded to Ba2 from
     Baa2

  -- Class AOA2, $11,000,000, Floating, downgraded to Ba3 from
     Baa3

  -- Class AOA4, $15,000,000, Floating, downgraded to B2 from Ba2
  -- Class PH1, $4,444,000, Floating, affirmed at Baa1
  -- Class PH2, $4,000,000, Floating, affirmed at Baa2
  -- Class PH3, $5,000,000, Floating, affirmed at Baa3
  -- Class CA1, $964,900, Floating, upgraded to A2 from Baa2
  -- Class CA2, $578,940, Floating, upgraded to A3 from Baa3
  -- Class CA3, $385,960, Floating, upgraded to Baa1 from Ba1
  -- Class SA1, $7,906,125, Floating, affirmed at Baa3

Moody's is affirming the above pooled classes due to overall
stable or improving property performances of the collateralized
assets associated with the pooled certificates.  Moody's is
upgrading the rake classes backed by the CarrAmerica Portfolio due
to improved property performances and the release of one asset.  
Moody's is downgrading the rake classes backed by 1330 Avenue of
the Americas due to sponsorship concerns as well as a slowdown in
market leasing.

The pooled Certificates are collateralized by eleven senior
mortgage loan participations.  As of the April 15, 2008
distribution date, the transaction's aggregate certificate balance
has decreased by approximately 53.6% to $1.2 billion from
$2.5 billion at securitization.  The significant reduction in the
aggregate balance is primarily caused by the April 2008 repayment
of the Macklowe EOP Manhattan Portfolio Loan (53.2% of the
original pooled trust balance).  The repayment was made on a
modified pro rata basis.

The largest remaining loan, MSREF/Glenborough Portfolio
($343.7 million -- 34.6% of the pooled trust balance) is secured
by sixteen office or mixed use properties located in five states
and totaling approximately 2.8 million square feet.  Four
properties that represented 3.7% of the allocated loan balance at
securitization have been released at no premium.  In aggregate,
net cash flow for the remaining assets has increased 5.7% from
2006 to 2007.  Moody's pooled loan to value ratio is 62.3%, up
slightly from securitization.  Moody's current underlying rating
is A3, the same as securitization.  Additionally, there are junior
trust loans secured by the portfolio which are the rake classes
GBL1, GBL2, GBL3 and GBL4.  Moody's current rating for GBL1, GBL2
and GBL4 are Baa2, Baa3 and Ba1, the same as securitization.
Moody's does not rate rake bond GBL3.

The 1330 Avenue of the Americas Loan ($187.0 million -- 18.8% of
the pooled trust balance) is secured by a 446,250 square foot,
Class A office building located on Sixth Avenue within Midtown
Manhattan.  The sponsor of the loan is Macklowe Properties.  Due
to the anticipated departure of the largest tenant Covington &
Burling (128,575 square feet or 28.8% of the net rentable area)
combined with additional tenant departures, the property's vacancy
rate has increased from 9.7% at securitization to 37.4%.  Net cash
flow has decreased 26.1% from 2006 to 2007.  Due to the current
business and legal issues facing the sponsor and a slowdown in
market leasing, Moody's is lowering the underlying rating of the
loan from A3 at securitization to Baa3.

Moody's pooled LTV has increased from 61.3% at securitization to
67.1%. Additionally, there are junior trust loans secured by the
property which are the rake classes AOA1, AOA2, AOA3 and AOA4.  
Moody's is downgrading the rating for AOA1, AOA2 and AOA4 from
Baa2 to Ba2, Baa3 to Ba3 and Ba2 to B2, respectively.  Moody's
does not rate rake bond AOA3.

The Poughkeepsie Galleria Loan ($121.1 million -- 12.2% of the
pooled trust balance) is secured by a 1.2 million square foot
regional mall located Poughkeepsie, New York.  The mall is
anchored by J.C. Penney, Macy's, Sears, and Target and includes a
16 screen stadium style movie cinema.  The sponsor of the loan is
the Pyramid Companies.  Net cash flow has experienced a slight
decrease of 1.7% 2006 to 2007.  Moody's current underlying rating
is A3, the same as securitization.  Moody's pooled LTV is 60.6%.  
Additionally, there are junior trust loans secured by the property
which are the rake classes PG1, PG2, PG3 and PG4.  Moody's current
rating for PG1, PG2, PG3 and PG4 are Baa1, Baa2, Baa3 and Ba1, the
same as securitization.

The Trizec Portfolio Mortgage Loan ($89.3 million -- 9.0% of the
pooled trust balance) is a pari passu participation in a
$600.0 million whole loan.  The cross-collateralized and cross-
defaulted mortgages consist of land and improvements on 22
separate office buildings totaling 7.9 million square feet.  The
properties are located in the following five metropolitan areas:
Los Angeles, California (10 properties -- 3.2 million square
feet); San Diego, California (3 properties -- 1.4 square feet);
Jersey City, New Jersey (1 property -- 1.1 million square feet);
Washington D.C. (6 properties -- 1.4 million square feet); and
Houston, Texas (2 properties -- 0.8 million square feet).  The
loan sponsors are Brookfield Properties Corporation and Blackstone
Real Estate Partners, L.L.P.  Moody's pooled LTV is 39.8%, the
same as securitization. Moody's current underlying rating is Aaa,
the same as at securitization.

The San Francisco Parc 55 loan ($67.6 million -- 6.8% of the
pooled trust balance) is secured by a 1,009-key, full service
hotel in San Francisco's theatre district near Union Square and
the Moscone Convention Center.  In 2007, a $20.4 million ($20,218
per key) room and meeting facility renovation occurred.  Despite
the renovation interruptions, RevPAR and net cash flow increased
7.3% and 4.6%, respectively from 2006 to 2007.  Moody's current
underlying rating is A3, the same as securitization.  Moody's
pooled LTV is 52.6%.  Additionally, there are junior trust loans
secured by the property which are the rake classes PH1, PH2, and
PH3.  Moody's current rating for PH1, PH2, and PH3 are Baa1, Baa2,
Baa3, the same as securitization.

The Sheraton Austin loan ($29.6 million -- 3.0% of the pooled
trust balance) is secured by a 365-key, full service hotel in
Downtown Austin, Texas.  The hotel was re-flagged as a Sheraton in
2007, departing from the Marriott brand affiliation.  In addition
the property is in the processes of a $16.6 million ($45,517 per
key renovation).  Moody's current underlying rating is A2, the
same as securitization.  Moody's pooled LTV is 51.6%.  
Additionally, there is a junior trust loan secured by the asset
which is the rake class SA1.  Moody's current rating for SA1 is
Baa3, the same as securitization.

The CarrAmerica Portfolio Loan ($11.6 million -- 1.2% of the
pooled trust balance) is secured by two office buildings known as
the Fairchild Research Center with 131,561 square feet located in
Mountain View, California, and an office/R&D complex known as
Sunnyvale Tech Center with 166,250 square feet located in
Sunnyvale, California.  A third property, Highland Corporate Park,
has been released from the security of the loan resulting in a
61.4% decrease in the outstanding loan balance.  Fairchild
Research Center is 100% leased to Nokia through June, 2009.
Sunnyvale Tech Center was 87.4% leased, as of Dec., 2007, compared
to 75.3% at securitization.

Moody's underlying rating for the pooled balance is A1, compared
to Baa1 at securitization.  The LTV for the pooled balance is
56.4%, compared to 61.4% at securitization.  The trust debt is a
50% pari passu interest.  Additionally, there are junior trust
loans secured by the portfolio which are the rake classes CA1,
CA2, and CA3.  Moody's is upgrading the rating for CA1, CA2 and
CA3 from Baa2 to A2, Baa3 to A3 and Ba1 to Baa1, respectively.


CONTINENTAL AIR: Sets Alliance with UAL After Failed Merger
-----------------------------------------------------------
United Airlines and Continental Airlines Inc. are holding talks to
form an alliance that would set pricing and schedules, Mary
Schlangenstein and John Hughes of Bloomberg News says.  The
alliance discussions went underway shortly after the failed merger
talks between the two airlines, Bloomberg said.

An alliance with U.S. antitrust immunity to collaborate on fares
would provide most of the benefits of a merger, at the same time
avoiding regulatory challenges as well as the need to combine
workforces, Bloomberg notes.

"Antitrust immunity is a kind of quasi-merger," James M. Higgins,
analyst at Soleil Securities Corp., told Bloomberg.  "It doesn't
put you through the actual integration, which is where the cost
savings ultimately can come, but which is also risky, especially
now."

"As we've said over the last few weeks, we are examining our
alliance relationships as we think it's important that we be a
major player in one of the three major global airline alliances,"
Bloomberg quotes Mary Clark, a spokeswoman for Continental, as
saying.

The alliance talks are reportedly separate from United's merger
talks with US Airways.

                 Continental Says "No" to Merger

As reported by the Troubled Company Reporter on April 28, 2008,
Continental Airlines Inc.'s Chairman and CEO Larry Kellner and
President Jeff Smisek disclosed to more than 45,000 employees that
the company's Board of Directors unanimously supported the
management's recommendation that, in the current industry
environment, the best course for Continental is not to merge with
another airline at this time.

According to the two executives, the Board very carefully
considered all the risks and benefits of a merger with another
airline, and determined that the risks of a merger at this time
outweigh the potential rewards, as compared to Continental's
prospects on a standalone basis.  The management will, however,
continue to review potential alliances and its membership in
SkyTeam.  Continental is considering alternatives to SkyTeam as
its carefully evaluates which major global alliance will be best
for Continental over the long term.

                          About UAL Corp.

Based in Chicago, Illinois, UAL Corporation (NASDAQ: UAUA)
-- http://www.united.com/-- is the holding company for United
Airlines, Inc.  United Airlines is the world's second largest
air carrier.  The airline flies to Brazil, Korea and Germany.

The company filed for chapter 11 protection on Dec. 9, 2002
(Bankr. N.D. Ill. Case No. 02-48191).  James H.M. Sprayregen,
Esq., Marc Kieselstein, Esq., David R. Seligman, Esq., and
Steven R. Kotarba, Esq., at Kirkland & Ellis, represented the
Debtors in their restructuring efforts.  Fruman Jacobson, Esq.,
at Sonnenschein Nath & Rosenthal LLP represented the Official
Committee of Unsecured Creditors before the Committee was
dissolved when the Debtors emerged from bankruptcy.

Judge Eugene R. Wedoff confirmed the Debtors' Second Amended Plan
on Jan. 20, 2006.  The company emerged from bankruptcy protection
on Feb. 1, 2006.

(United Airlines Bankruptcy News; Bankruptcy Creditors' Service
Inc., http://bankrupt.com/newsstand/or 215/945-7000).

                            *     *     *

As reported in the Troubled Company Reporter on April 24, 2008,
Standard & Poor's Ratings Services said that its ratings and
outlook on UAL Corp., parent of United Air Lines Inc. (both rated
B/Negative/--) are not affected by UAL's report of a heavy
first-quarter loss.  UAL reported a first-quarter $542 million
pretax loss, as much higher fuel prices more than offset increased
revenues.  S&P had revised its rating outlook on both entities to
negative from stable on April 16, 2008.  In that outlook revision,
S&P cited very high fuel prices and the expected effect on UAL
revenues of a weak U.S. economy.

                   About Continental Airlines

Continental Airlines Inc. (NYSE: CAL) -- http://continental.com/    
-- is the world's fifth largest airline.  Continental, together
with Continental Express and Continental Connection, has more than
2,900 daily departures throughout the Americas, Europe and Asia,
serving 144 domestic and 139 international destinations.  More
than 500 additional points are served via SkyTeam alliance
airlines.  With more than 45,000 employees, Continental has hubs
serving New York, Houston, Cleveland and Guam, and together with
Continental Express, carries approximately 69 million passengers
per year.

                          *     *     *

As reported in the Troubled Company Reporter on April 22, 2008,
Standard & Poor's Ratings Services revised its rating outlook on
Continental Airlines Inc. (B/Negative/B-3) to negative from
stable.  S&P also placed its ratings on selected enhanced
equipment trust certificates that are secured by regional jets on
CreditWatch with negative implications.

As reported in the Troubled Company Reporter on Dec. 27, 2007,
Fitch Ratings affirmed Continental Airlines 'B-' issuer default
rating with a stable outlook.


COUNTRY-WIDE INSURANCE: A.M. Best Lifts IC Rating to bb- from b
---------------------------------------------------------------
A.M. Best Co. has upgraded the financial strength rating to B-
(Fair) from C++(Marginal) and issuer credit rating to "bb-" from
"b" of Country-Wide Insurance Company.  The outlook for both
ratings is stable.

The upgrades reflect Country-Wide's strengthened risk-adjusted
capitalization, improved operating performance and extensive local
market expertise in the downstate New York automobile marketplace.  
Recent operating profitability has been attributed to management's
focus on core underwriting results and improved internal controls.  
Specific corrective actions included stringent underwriting,
improved rate adequacy and enhanced claim controls.  Underwriting
performance further benefited from management's increased emphasis
on reserve adequacy and technology advancements.

Offsetting factors include Country-Wide's elevated gross
underwriting leverage measures and dependence on reinsurance for
surplus relief as measured by its reinsurance recoverable balance
and high ceded reinsurance leverage ratio.  Also, unfavorable loss
reserve development trends in prior years dampened underwriting
results and severely weakened risk-adjusted capitalization.  
Country-Wide's business concentration exposes earnings to changes
in the regulatory and legislative environment as well as
competitive market pressures.


CSFB MORTGAGE: Moody's Holds Junked Ratings on Two Cert. Classes
----------------------------------------------------------------
Moody's Investors Service affirmed the ratings of five classes of
Credit Suisse First Boston Mortgage Securities Corp., Commercial
Mortgage Pass-Through Certificates, Series 1997-C2 as:

  -- Class A-X, Notional, affirmed at Aaa
  -- Class D, $38,533,712, affirmed at Aaa
  -- Class E, $25,655,000, affirmed at Aaa
  -- Class H, $29,320,000, affirmed at Caa2
  -- Class I, $14,660,000, affirmed at C

Although the performance of the pool has declined, Moody's is
affirming the investment grade ratings due to the build up in
credit support from loan payoffs and amortization.  Despite the
increase in credit support, Moody's is affirming the below
investment grade ratings due to concerns over potential future
losses.

As of the May 17, 2008 distribution date, the transaction's
aggregate principal balance has decreased by approximately 86.5%
to $197.6 million from $1.5 billion at securitization.  The
Certificates are collateralized by 49 mortgage loans ranging in
size from less than 1.0% to 9.7% of the pool, with the top 10 non-
defeased loans representing 52.4% of the pool.  The pool includes
a credit tenant lease component which represents 43.5% of the
pool.  Four loans, representing 14.1% of the pool, have defeased
and are secured with U.S. Government securities.

Twenty-one loans have been liquidated from the pool resulting in
aggregate realized losses of approximately $39.4 million.
Currently two loans, representing 8.2% of the pool, are in special
servicing.  Moody's has not projected any losses from the
specially serviced loans.  Nine loans, representing 20.0% of the
pool, are on the master servicer's watchlist.  Four of the
watchlisted loans, representing 8.5% of the pool, are on the
watchlist because the respective borrowers were not able to
refinance their loans on their ARD date.  The servicer has
enforced cash management agreements for each of these loans
pursuant to the loan documents and the loans are being monitored
by the special servicer.

Moody's was provided with full and partial year 2007 operating
results for 89.0% and 100.0% of the pool's performing conduit
loans, respectively.  Moody's weighted average loan to value  
ratio is 86.2% compared to 75.1% at Moody's last full review in
June 2006 and 84.6% at securitization.

The top three non-defeased loans represent 22.6% of the
outstanding pool balance.  The largest loan is the 78 Corporate
Center Loan ($19.1 million -- 9.7%), which is secured by a 176,700
square foot office building located in Bedminister Township, New
Jersey.  The property is 100.0% leased to Verizon Wireless
(Moody's senior unsecured rating for parent, Verizon
Communications, Inc., is A3; stable outlook) through November
2021.  The loan benefits from a hyper-amortization schedule and
has amortized 40.1% since securitization.  The loan matures in May
2014. Moody's LTV is 64.5% compared to 73.5% at last review.

The second largest loan is the Kendig Square Shopping Center Loan
($13.3 million -- 6.7%), which is secured by a 260,200 square foot
retail center located in West Lampeter Township (Lancaster
County), Pennsylvania. Major tenants include K-Mart, Eckerd and
Dollar Tree.  The loan matures in November 2011.  Moody's LTV is
74.3% compared to 76.9% at last review.

The third largest loan is the Bannockburn Executive Plaza Loan
($9.2 million -- 4.7%), which is secured by a 132,000 square foot
office building located approximately 30 miles north of Chicago in
Bannockburn, Illinois.  The property was 92.0% leased as of
December 2007.  The loan is on the watchlist due to the upcoming
lease expirations of four tenants which occupy approximately 38.0%
of the premises.  Although the property's performance has improved
since last review, Moody's analysis incorporates a downward
adjustment to reflect the expected decline in occupancy due to
lease expirations.  The loan matures in November 2012.  Moody's
LTV is 85.6% compared to 66.9% at last review.

The CTL component is secured by 35 properties leased to 9 tenants
under bondable triple net leases.  The largest exposures include
CVS Corporation (Moody's senior unsecured rating Baa2, stable
outlook; 30.3% of the CTL component), Kmart Corporation (Moody's
senior unsecured rating of parent, Sears Holdings Company, is Ba1;
stable outlook; 25.4%) and Cobbs Theaters (11.0%).


CRYOCATH TECHNOLOGIES: March 31 Balance Sheet Upside-Down by $6MM
-----------------------------------------------------------------
CryoCath(R) Technologies Inc.'s balance sheet at March 31, 2008,
showed total assets of $36.8 million and total liabilities of
$43.2 million, resulting in a total shareholders' deficit of
roughly $6.4 million.

CryoCath's net loss for the second quarter ended March 31, 2008,
is $6.1 million compared with a net loss of $6.0 million in the
second quarter of fiscal 2007.
    
Working Capital was $8.6 million at March 31, 2008, a decrease of
$4 million from the working capital at Dec. 31, 2007 of
$12.6 million, and a decrease of $9.4 million from the working
capital of $18.0 million at Sept. 30, 2007.

The company's cash, cash equivalents and short-term investments
totaled $10.5 million a decrease of $3.1 million and $13.5 million
over the $13.6 million at Dec. 31, 2007, and the $24.0 million at
Sept. 30, 2007.

The company, as of March 31, 2008, had access to approximately
$15.9 million in cash and borrowing facilities as compared to
$19.4 million at the end of December 2007.

                  About CryoCath Technologies Inc.

Headquartered in Quebec, Canada, CryoCath Technologies Inc.
(TSE:CYT) -- http://www.cryocath.com/-- is a medical technology  
company engaged in creating minimally invasive, catheter
cryotherapy products to treat cardiovascular diseases.  The
Company\u2019s range of catheter and probe designs for the
treatment of achyarrhythmia includes focal catheters (Freezor,
Freezor Xtra and Freezor MAX) and balloon catheter (Arctic Front)
CryoAblation products. Freezor, Freezor Xtra and Freezor MAX
catheters are deflectable and torquable, incorporating three
electrocardiogram rings and a temperature sensor at the tip for
temperature monitoring and control. Arctic Front is a balloon
catheter that has been developed and designed to create lesions
near or in the ostea (openings) of the pulmonary veins to treat
AF.


CSFB MANUFACTURED: S&P Cuts Rating on Class B-1 Certificates to B+
------------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on four
classes of certificates issued from CSFB Manufactured Housing
Pass-Through Certificates series 2001-MH29 and 2002-MH3 and
removed them from CreditWatch with negative implications.  At the
same time, S&P affirmed the ratings on the class A and M-1
certificates from the same transactions.
     
The lowered ratings reflect higher-than-expected cumulative net
losses and the deterioration of credit enhancement caused by the
weak performance trends associated with the underlying pool of
manufactured housing contracts originated by CIT Group/Sales
Financing Inc.
     
As of the April 2008 distribution date, CSFB 2001-MH29 had
experienced current cumulative net losses of 10.41%, with 77
months of performance and a pool factor of 40.08%.  CSFB 2002-MH3
had experienced current cumulative net losses of 8.22%, with 72
months of performance and a pool factor of 46.25%.  As a result of
the higher-than-expected losses, overcollateralization for CSFB
2001-MH29 has been reduced to 1.34% of the initial collateral
balance, which is below the required level of 4%, and
overcollateralization for CSFB 2002-MH3 has been reduced to 1.58%
of the initial collateral balance, which is below the required
level of 7%.
     
S&P believe that because of the higher-than-expected cumulative
net losses, the remaining credit support is no longer sufficient
to maintain the previous ratings on the class M-2 and B-1
certificates.  Standard & Poor's will continue to monitor these
transactions to determine whether further rating actions are
warranted.


      Ratings Lowered and Removed from Creditwatch Negative
    
       CSFB Manufactured Housing Pass-Through Certificates

                                         Rating
                                         ------
         Series         Class          To       From
         ------         -----          --       ----
         2001-MH29      M-2            A-       A/Watch Neg
         2001-MH29      B-1            B+       BBB/Watch Neg
         2002-MH3       M-2            A-       A/Watch Neg
         2002-MH3       B-1            B+       BBB/Watch Neg

                         Ratings Affirmed

        CSFB Manufactured Housing Pass-Through Certificates

               Series         Class          Rating
               ------         -----          ------
               2001-MH29      A              AAA
               2001-MH29      M-1            AA
               2002-MH3       A              AAA
               2002-MH3       M-1            AA


CSMC TRUST: S&P Junks Ratings on Seven Cert. Classes
----------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on all nine
classes of mortgage-backed pass-through certificates issued by
CSMC Mortgage-Backed Trust Series 2006-4.  Concurrently, S&P
placed its 'AAA' ratings on 23 classes on CreditWatch with
negative implications.
     
The lowered ratings reflect our opinion that, given S&P's lifetime
projected losses, projected credit support for the affected
classes is insufficient to support the ratings at their previous
levels.  Standard & Poor's notes that there are two structures in
the transaction, but in this press release S&P address only the
structure containing Alternative-A collateral.
     
To assess the creditworthiness of each class, S&P reviewed the
individual delinquency and loss trends for changes, if any, in
risk characteristics, servicing, and the ability to withstand
additional credit deterioration.  As of the April 25, 2008,
distribution date, severe delinquencies were approximately 13.9%
of the current pool balance.  Cumulative realized losses for this
transaction are 0.40% of the original pool balance.  Class D-B-9
took a $675,796 write-down in the last pay period, which prompted
us to downgrade this class to 'D'.
     
This delinquency and loss trend, together with loan-level risk
characteristics and continuing deterioration in the macroeconomic
outlook, has enabled us to arrive at S&P's lifetime projected
losses.  S&P believe its consideration of expected lifetime losses
has become appropriate as the depth and duration of the housing
downturn continues to increase.  In reviewing this transaction,
S&P employed the surveillance assumptions announced on Jan. 15,
2008, and described in "U.S. RMBS Surveillance, CDO Of ABS
Assumptions Revised Amid Defaults, Negative Housing Outlook,"
published on RatingsDirect.  Consequently, S&P have placed all its
'AAA' ratings on CreditWatch with negative implications and
lowered our ratings on all other certificates from this
transaction.
     
Subordination is the primary source of credit support for this
transaction.  The underlying collateral for this series consists
of fixed-rate U.S. Alt-A mortgage loans that are secured by first
liens on one- to four-family residential properties.
     

                          Ratings Lowered

             CSMC Mortgage-Backed Trust Series 2006-4
            Mortgage-backed pass-through certificates

                                   Rating
                                   ------
                 Class      To                From
                 -----      --                ----
                 D-B-1      B                 AA-
                 D-B-2      CCC               A
                 D-B-3      CC                A-
                 D-B-4      CC                BBB+
                 D-B-5      CC                BBB
                 D-B-6      CC                BBB-
                 D-B-7      CC                BB+
                 D-B-8      CC                BB-
                 D-B-9      D                 B-


              Ratings Placed on Creditwatch Negative

             CSMC Mortgage-Backed Trust Series 2006-4
             Mortgage-backed pass-through certificates

                                   Rating
                                   ------
                 Class      To                From
                 -----      --                ----
                 1-A-1      AAA/Watch Neg     AAA
                 1-A-2      AAA/Watch Neg     AAA
                 1-A-3      AAA/Watch Neg     AAA
                 1-A-4      AAA/Watch Neg     AAA
                 1-A-5      AAA/Watch Neg     AAA
                 1-A-6      AAA/Watch Neg     AAA
                 1-A-7      AAA/Watch Neg     AAA
                 1-A-8      AAA/Watch Neg     AAA
                 1-A-9      AAA/Watch Neg     AAA
                 1-A-10     AAA/Watch Neg     AAA
                 1-A-11     AAA/Watch Neg     AAA
                 1-A-12     AAA/Watch Neg     AAA
                 1-A-13     AAA/Watch Neg     AAA
                 2-A-1      AAA/Watch Neg     AAA
                 3-A-1      AAA/Watch Neg     AAA
                 3-A-2      AAA/Watch Neg     AAA
                 4-A-1      AAA/Watch Neg     AAA
                 8-A-1      AAA/Watch Neg     AAA
                 9-A-1      AAA/Watch Neg     AAA
                 10-A-1     AAA/Watch Neg     AAA
                 10-A-2     AAA/Watch Neg     AAA
                 D-X        AAA/Watch Neg     AAA
                 D-P        AAA/Watch Neg     AAA


CY ORIENTAL: Gets Consent from Lender to File Records Until May 31
------------------------------------------------------------------
CY Oriental Holdings Ltd. obtained consents from Maple Trade
Finance Inc., the company's trade finance lender, to extend filing
of the company's audited financial statements until May 30, 2008.

The company is also in the process of obtaining a similar consent
from its bank lender, HSBC, pursuant to the terms of the company's
lending facilities with these two lenders.

The company disclosed that it is necessary delay the filing to
provide additional time to gather and review documentation
relating to the company's purchase and sales transactions.

The company related that if necessary, it will request additional
consents from these lenders to further extend the filing of the
company's audited financial statements to June 2008.

The company expects that the review will be completed in June 2008
and expects that the audited year end financial statements will be
filed by June 30, 2008.

If the company fail to file the audited year end financial
statements by June 30, 2008, the Canadian Securities Regulators
may impose a cease trade order on all trading of the company's
shares until the financial statements are filed.

Also, the company's interim financial statements for the first
quarter period ended March 31, 2008, are expected to be filed
after the audited year end financial statement are filed and
therefore, such interim financial statements will not be filed by
May 30, 2008.

Additionally, the company disclosed that the company's insiders
are barred from trading CY Oriental shares until the company's
audited financial statements for the fiscal year ended Dec. 31,
2007, are filed, pursuant to the terms of the management cease
trade order issued by the British Columbia Securities Commission.

                  About CY Oriental Holdings Ltd.

CY Oriental Holdings Ltd. -- http://www.cyoriental.com/-- (TSX-V:  
CYO) is a Canadian incorporated, China-based manufacturer and
value-added supplier of apparel and fashion products to leading
international brands and retailers, including department stores.  
CY Oriental owns and operates a manufacturing facility in
Shanghai, China and in the city of Tengzhou, China.  The company's
ready-made products include quality garments, including woven
casual wear, woven formal wear, casual jeanswear and sports
outerwear.


EINSTEIN NOAH: Inks Interest Rate Swap Deal with Wells Fargo
------------------------------------------------------------
Einstein Noah Restaurant Group, Inc., entered into an interest
rate swap with Wells Fargo Foothills, pursuant to an International
Swaps and Derivatives Association Master Agreement in customary
form.  The company entered into the interest rate swap transaction
to mitigate the company's floating rate interest risk on
$60 million of its total outstanding debt under our amended credit
facility dated as of June 28, 2007.  The interest rate swap has an
effective date of Aug. 28, 2008, and a termination date of Aug.
28, 2010.

The company is required to make certain fixed rate payments to the
Bank calculated on an initial notional amount of $60 million, in
exchange for receiving floating payments based on a LIBOR rate for
the same initial $60 million notional amount.  The interest rate
swap transaction effectively fixes the annual interest rate
payable on $60 million of the company's total outstanding debt at
3.52% plus an applicable margin.  Notwithstanding the terms of the
interest rate swap transaction, the company is ultimately
obligated for all amounts due and payable under the credit
facility.  The company may enter into additional swap transactions
in the future from time to time.

Headquartered in Lakewood, Colo., Einstein Noah Restaurant Group
Inc. (Nasdaq: BAGL) -- http://www.einsteinnoah.com/-- operates a   
a retail chain of quick casual restaurants in the United States,
specializing in foods for breakfast and lunch.  The company
operates locations primarily under the Einstein Bros.(R) Bagels
and Noah's New York Bagels(R) brands and primarily franchises
locations under the Manhattan Bage(R) brand.  The company's retail
system consists of more than 600 restaurants, including more than
100 license locations, in 35 states plus the District of Columbia.

At April 1, 2008, the company's consolidated balance sheet showed
$154.1 million in total assets and $183.2 million in total
liabilities, resulting in a $29.1 million total stockholders'
deficit.


ENCAP GOLF: Taps Cole Schotz as Bankruptcy Counsel
--------------------------------------------------
EnCap Golf Holdings LLC and NJM Capital LLC ask the Hon. Novalyn
L. Winfield of the United States Bankruptcy Court for the District
of New Jersey for authority to employ Cole, Schotz, Meisel, Forman
& Leonard, P.A., as their bankruptcy counsel.

Cole Schotz is expected to:

   a) advise the Debtors of their rights, powers, and duties as
      debtors-in-possession in continuing to operate and manage
      their assets;

   b) advise the Debtors concerning, and assisting in the
      negotiation of and documentation of, the use of cash
      collateral and post-petition financing, debt restructuring
      and related transactions;

   c) review the nature and validity of agreements relating to the
      Debtors' business and property and advise the Debtors in
      connection therewith;

   d) review the nature and validity of liens, if any, asserted
      against the Debtors and advise as to the enforceability of
      such liens;

   e) advise the Debtors concerning the actions the Debtors might
      take to collect and recover property for the benefit of
      their estates;

   f) prepare on the Debtors' behalf all necessary and appropriate
      applications, motions, pleadings, orders, notices,
      petitions, schedules, and other documents, and review all
      financial and other reports to be filed in the Debtors'
      Chapter 11 cases;

   g) advise the Debtors concerning, and preparing responses to,
      applications, motions, pleadings, notices, and other papers
      which may be filed in the Debtors' Chapter 11
      cases;

   h) counsel the Debtors in connection with formulation,
      negotiation and promulgation of a plan of reorganization and
      related documents; and

   i) perform all other legal services for and on behalf of the
      Debtors which may be necessary or appropriate in the
      administration of their Chapter 11 cases.

As of the Debtors' bankruptcy filing, the firm has a $500 retainer
and will hold that cash for legal services to be performed during
these Chapter 11 cases.

The firm's professionals current rates are:

      Designations              Hourly Rates
      ------------              ------------
      Members                     $380-$625
      Associates                  $240-$325
      Paralegals                  $145-$215

Michael D. Sirota, Esq., shareholders of the firm, assures the
Court that the firm does not hold any adverse interest in the
Debtors' estate and is a "disinterested person" as defined in
Section 101(14) of the Bankruptcy Code.

Mr. Sirota can be reached at:

      Michael D. Sirota, Esq.
      Shareholders
      Cole, Schotz, Meisel, Forman & Leonard, P.A.
      Court Plaza North, 22 Main Street
      P.O. Box 800
      Hackensack, New Jersey 07602-0800
      Tel: (201) 489-3000
      Fax: (201) 489-1536
      http://www.coleschotz.com/

Headquartered in East Rutherford, New Jersey, EnCap Golf
Holdings, LLC, a subsidiary of Cherokee Investment Partners of
North Carolina, develops closed landfills and other brownfield
properties into golf courses.  The company and its affiliate,
NJM Capital LLC, filed for Chapter 11 protection on May 8, 2008
(Bankr. D. N.J. Lead Case No.08-18581).  When the Debtors filed
for protection against their creditors, they listed asset and
debts between $100 million and $500 million.


ENERGY PARTNERS: Posts $2.3 Million Net Loss in 2008 First Quarter
------------------------------------------------------------------
Energy Partners Ltd. reported last week financial and operational
results for the first quarter ended March 31, 2008.

For the first quarter of 2008, the company reported net income of
$2.3 million, compared to net income for the first quarter of 2007
of $3.7 million.  Revenue for the first quarter of 2008 was
$97.5 million, compared with first quarter 2007 revenues of
$108.5 million.

Discretionary cash flow, which is cash flow from operating
activities before changes in working capital and exploration
expenses, was $55.4 million versus $71.2 million in the first
quarter last year.  Cash flow from operating activities in the
first quarter of 2008 was $62.4 million compared with
$113.8 million in the same quarter a year ago.  The first quarter
of 2007 benefited from higher production volumes, some from
properties that have since been sold, and the settlement of
insurance claims related to Hurricanes Katrina and Rita.

The first quarter of 2008 benefited from strong commodity prices,
including record oil prices, and a pre-tax gain on the sale of two
non-operated Western area properties totaling $7.1 million.  These
benefits were reduced by the previously announced dryhole cost of
$18.2 million for an exploratory well in South Timbalier 46 and a
pre-tax loss on derivative instruments of $8.3 million, of which
$3.1 million was a pre-tax non-cash unrealized loss.

Lease operating expenses and depreciation, depletion, and
amortization were lower than the same period a year ago due mainly
to the sale of substantially all of the company's onshore south
Louisiana assets in June 2007 and lower production volumes.
Additionally, general and administrative expenses substantially
decreased in the first quarter of 2008 due to lower personnel
costs and the absence of financial and legal advisory costs
related to the exploration of strategic alternatives and self
tender offer fees present in the first quarter of 2007.

Production for the first quarter of 2008 averaged 15,799 barrels
of oil equivalent (Boe) per day, versus 25,982 Boe per day in the
first quarter of 2007.  First quarter 2008 production volumes were
down compared to the first quarter of 2007 primarily due to
natural field declines, the sale of substantially all of the  
company's onshore south Louisiana properties in June of 2007 and
minimal contributions from new production within the quarter.

Natural gas production in the first quarter of 2008 averaged
56.2 million cubic feet (Mmcf) per day and oil production averaged
6,432 barrels per day.

Price realizations, all of which are stated before the impact of
derivative instruments, averaged $93.24 per barrel for oil and
$8.38 per thousand cubic feet (Mcf) of natural gas in the first
quarter of 2008, compared to $53.31 per barrel and $7.09 per Mcf
in the first quarter of 2007.

During the quarter, capital expenditures for exploration and
development activities totaled $65.0 million.  As of March 31,
2008, the company had cash on hand of $13.8 million and total debt
of $474.5 million.  This compares to the Dec. 31, 2007 cash
balance of $8.9 million and total debt of $484.5 million.  The
company has completed its semi annual borrowing base
redetermination and, as anticipated, the borrowing base has been
set at $150.0 million, of which $25.0 million is currently drawn.

Richard A. Bachmann, the company's chairman and chief executive
officer, commented, "We are pleased we have made progress towards
meeting our outlined goals this year.  We were able to meet our
production goal in the first quarter despite not yet having
contribution from our deepwater Raton well.  Our exploration
drillwell performance is back in line with our historical success
rate in the mid-seventy percent range, and our development
drillwell program is off to a good start in South Timbalier 26 and
is yielding better than expected results in East Bay.

"I am also pleased to see our overall expenses are trending down
as forecasted, and we are continuing the process to reduce our
cash costs to better match our narrowed focus within our core
Eastern and Central offshore areas."

                          Balance Sheet

At March 31, 2008, the company's consolidated balance sheet showed
$815.7 million in total assets, $709.5 million in total
liabilities, and $106.2 million in total stockholders' equity.

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?2bea

                      About Energy Partners

Founded in 1998, Energy Partners Ltd. (NYSE: EPL) --
http://www.eplweb.com/-- is an independent oil and natural gas  
exploration and production company based in New Orleans,
Louisiana.  The company's operations are focused along the U.S.
Gulf Coast, both onshore in south Louisiana and offshore in the
Gulf of Mexico.

                          *     *     *

As reported in the Troubled Company Reporter on March 4, 2008,
Standard & Poor's Ratings Services said that ratings on Energy
Partners Ltd. (B/Negative/--) would not be immediately affected by
several recent developments.  The company announced $100.0 million
in noncash, pretax impairment charges, largely related to
mechanical failures, early depletion, and production difficulties
in fields located in its Western offshore area.  Its leverage
metrics have weakened year-over-year, with debt per proved barrel
currently above $11 on an adjusted basis.  And it has seen feeble
drilling and reserve replacement results in 2007.

As reported in the Troubled Company Reporter on March 3, 2008,
Moody's Investors Service downgraded Energy Partners Ltd.'s
Corporate Family Rating to Caa1 from B3, its Probability of
Default to Caa1 from B3, and the ratings on its $300.0 million
senior unsecured fixed rate notes and $150.0 million senior
unsecured floating rate notes to Caa2 (LGD 4, 67%) from Caa1
(LGD 4, 65%).  The downgrade reflects EPL's continued weak capital
productivity, especially as evidenced by its 2007 results,
negative sequential quarterly production trends, and continued
high financial leverage.  The rating outlook remains negative.


EPICEPT CORP: Faces Nasdaq Delisting on Depressed Securities Value
------------------------------------------------------------------
EpiCept Corp. was notified by the Nasdaq Listing Qualifications
Department that the Company has not regained compliance with the
continued listing requirements of The Nasdaq Capital Market
because the market value of the company's listed securities fell
below $35,000,000 for ten consecutive trading days (pursuant to
Rule 4310(c)(3)(B) of the Nasdaq Marketplace Rules).  As a result,
its securities are subject to delisting from The Nasdaq Capital
Market.

As reported in the Troubled Company Reporter on April 22, 2008,
the company disclosed that the Nasdaq Listing Qualifications
Department notified EpiCept on April 4, 2008 that it was not in
compliance with the market value requirement.  Pursuant to Nasdaq
Marketplace Rule 4310(c)(8)(C), the company was provided a period
of 30 calendar days, or until May 5, 2008, to regain compliance.

The company intends to request a hearing before a Nasdaq Listing
Qualifications Panel to review this determination.  The company's
securities will remain listed on The Nasdaq Capital Market pending
the Panel's decision.  The company expects the hearing to be held
in approximately 30 to 45 days and the Panel's decision to be
announced within 30 to 45 days after the hearing.  In the event
the company's securities are delisted from The Nasdaq Capital
Market, the company's securities may also be eligible to trade on
the over-the-counter market.

Based in Tarrytown, New York, EpiCept Corporation (NASDAQ:EPCT) --  
http://www.epicept.com/-- is a specialty pharmaceutical company   
focused on the development of pharmaceutical products for the
treatment of cancer and pain.  The company has a portfolio of five
product candidates in active stages of development.  It includes
an oncology product candidate submitted for European registration,
two oncology compounds, a pain product candidate for the treatment
of peripheral neuropathies and another pain product candidate for
the treatment of acute back pain.  The two wholly owned
subsidiaries of the company are Maxim, based in San Diego,
California, and EpiCept GmbH, based in Munich, Germany, which are
engaged in research and development activities.

EpiCept Corp.'s consolidated balance sheet at Dec. 31, 2007,
showed stockholders' deficit of $14.1 million, compared with a
deficit of $9.3 million at Dec. 31, 2006.


EPICEPT CORP: Amends Loan & Warrant Pacts with Hercules Technology
------------------------------------------------------------------
EpiCept Corp. amended its loan, warrant, and deposit control
agreements with Hercules Technology Growth Capital, Inc.

The company agreed with Hercules to maintain, subject to certain
exceptions, a minimum cash balance of $500,000 in the company's
bank accounts that are subject to the security interest maintained
by Hercules under the loan agreement.  The company amended the
Hercules loan agreement to state that by May 19, 2008, the company
shall deliver to Hercules a term sheet or commitment letter from a
third party for a transaction on terms reasonably acceptable to
Hercules which provide gross proceeds to the company of at least
$10,000,000.

By June 15, 2008, the company is required to have received at
least $5,000,000 in proceeds from such transaction.  By July 31,
2008, the company is required to have received the remainder of
the proceeds.  Additionally, the company is required to pay
Hercules an amendment fee of $50,000.

The company also amended the Hercules warrant so that the number
of shares of the company's common stock issuable upon exercise of
the warrant, or the warrant shares, would be equal to the quotient
derived by dividing (a) $665,999 by (b) the exercise price.  The
exercise price was amended to be the lesser of (1) $1.46 and (2)
the volume weighted average price for the 10 trading days
immediately prior to May 7, 2008, or the current price, provided
that if a subsequent eligible financing does not occur by June 30,
2008, the exercise price from and after June 30, 2008 shall be the
lesser of (1) the current price and (2) the volume weighted
average price for the 10 trading days immediately prior to June
30, 2008.

If the company participates in a subsequent eligible financing by
issuing any equity securities after May 7, 2008 and before June
30, 2008 in a transaction or series of transactions in which the
company receives proceeds of at least $5,000,000, then at the
option of Hercules, the warrant shares shall be of the type and
series issued in the subsequent eligible financing and shall
include all rights of a holder of such securities, including any
warrants or rights to acquire other securities, and the exercise
price shall be the price per share paid by the purchasers of the
equity securities in subsequent eligible financing.

A full-text copy of the First Amendment to the Loan and Security
Agreement is available for free at
http://ResearchArchives.com/t/s?2c01

A full-text copy of the Second Amendment to the Warrant Agreement
is available for free at http://ResearchArchives.com/t/s?2c02

A full-text copy of the First Amendment to the Deposit Account
Control Agreement is available for free at
http://ResearchArchives.com/t/s?2c03

                     About EpiCept Corporation

Based in Tarrytown, New York, EpiCept Corporation (NASDAQ:EPCT) --  
http://www.epicept.com/-- is a specialty pharmaceutical company   
focused on the development of pharmaceutical products for the
treatment of cancer and pain.  The company has a portfolio of five
product candidates in active stages of development.  It includes
an oncology product candidate submitted for European registration,
two oncology compounds, a pain product candidate for the treatment
of peripheral neuropathies and another pain product candidate for
the treatment of acute back pain.  The two wholly owned
subsidiaries of the company are Maxim, based in San Diego,
California, and EpiCept GmbH, based in Munich, Germany, which are
engaged in research and development activities.

EpiCept Corp.'s consolidated balance sheet at Dec. 31, 2007,
showed stockholders' deficit of $14.1 million, compared with a
deficit of $9.3 million at Dec. 31, 2006.


FLEETWOOD ENTERPRISES: Sells Property to Finance Bond Redemption
----------------------------------------------------------------
Fleetwood Enterprises Inc. sold its property assets in order to
pay off an upcoming bond redemption, The Wall Street Journal
reports.

The company's bondholders will redeem around $100 million in bonds
on Dec. 15, 2008.  Fleetwood needs to finance the redemption and
consequently has sold off its headquarters in Riverside,
California for $23.5 million, relates WSJ.

Additionally, the company is currently surveying its assets for
possible sales, WSJ says.

Aside from asset sales, the company is contemplating on issuing
shares of stock to pay those bonds.  "[W]e are sure we can meet
this requirement, though it sure could have happened at a better
time," WSJ quotes company treasurer Lyle Larkin as saying.

In its financial statements for the fourth quarter and fiscal year
ended April 27, 2008, the company posted $370 million in revenues
for the three months ended April 27, 2008, compared to $488
million in revenues during the same quarter of last year.

According to WSJ, demand for recreational vehicles has fallen as
home values have decreased.  One key factor for this has been the
surging prices of gasoline and fuel, says WSJ, citing Al Koch of
turnaround experts firm AlixPartners.

Based in Riverside, California, Fleetwood Enterprises Inc. --
http://www.fleetwood.com/-- through its subsidiaries, is one of  
North America's largest producers of recreational vehicles and
manufactured homes.  Fleetwood has approximately 9,000 associates
working in facilities strategically located throughout the nation.


FOOTSTAR INC: Board Intends to Liquidate Company by End of 2008
---------------------------------------------------------------
The board of directors of Footstar Inc. and its debtor-affiliates
has decided to liquidate the group of companies by the end of
2008, Footwear News reports.

Pursuant to a liquidation plan, the company will give out cash
distributions to its shareholders coming from current cash and
other proceeds from asset sales, and will submit a dissolution
plan to the shareholders in 2009.  As a prelude to the
liquidation, the company will issue a $1 share distribution to
interest holders on June 3, relates Footwear News.

Based in West Nyack, New York, Footstar Inc. --
http://www.footstar.com/-- retails family and athletic footwear.   
As of August 28, 2004, the company operated 2,373 Meldisco
licensed footwear departments nationwide in Kmart, Rite Aid and
Federated Department Stores.  The company also distributes its own
Thom McAn brand of quality leather footwear through Kmart, Wal-
Mart and Shoe Zone stores.

The company and its debtor-affiliates filed for chapter 11
protection on March 3, 2004 (Bankr. S.D.N.Y. Case No. 04-22350).  
Paul M. Basta, Esq., at Weil Gotshal & Manges represents the
Debtors in their successful restructuring.  When the Debtor filed
for Chapter 11 protection, it listed $762,500,000 in total assets
and $302,200,000 in total debts.

The Court confirmed the Debtors' Amended Joint Plan on Jan. 25,
2006.  The Plan became effective on Feb. 7, 2005.


GENERAL MOTORS: Reaches Tentative Settlements with CAW Officials
----------------------------------------------------------------
The Canadian Auto Workers union reached tentative settlements with
both General Motors Corp. and Chrysler LLC that meet the pattern
established with Ford Motor Co.  The CAW represents close to
13,000 GM workers and 8,000 Chrysler workers in Canada.

As reported in the Troubled Company Reporter on May 7, 2008, for
the first time in its history, Ford Motor Company of Canada,
Limited reached a collective bargaining agreement with CAW more
than four months before the current contract expires.  Ford
employees represented by the CAW ratified the new deal in a vote
held May 4, 2008.  The early settlement brings stability to Ford's
operations as it prepares to launch the new Ford Flex crossover
vehicle at the Oakville Assembly Complex, which also builds the
Ford Edge and Lincoln MKX.  Ford disclosed plans to add 500
positions to increase production at the Oakville plant due to high
demand for the Ford Edge and Lincoln MKX, and to prepare for the
start of production of the Ford Flex.

According to a CAW press statement, both settlements were
unanimously endorsed by the CAW/GM and CAW/Chrysler Master
Bargaining committees, respectively and later overwhelmingly
supported by local union leadership.

The three-year agreements resist two-tier wages and provide
productivity and quality bonuses, improved restructuring
incentives, benefit improvements, COLA increases in both second
and third years and improved language on health and safety issues
among other gains.

The union negotiated new product commitments for both Oshawa car
and St. Catharines facilities as well as a strong close-out
agreement for members at the GM Windsor Transmission plant.  
During bargaining the company announced that the Windsor plant
will close in 2010.

The union also extended the operating life of the Chrysler Casting
plant in Etobicoke, Ontario, at least until 2011.

The tentative settlements are subject to ratification by CAW
members.  Ratification meetings will be held at various GM and
Chrysler locations on Friday, May 16 and Saturday, May 17, 2008.  
CAW media advisories will be issued after the ratification votes
are counted at each company providing details of the results.

Ratification meeting dates, times and locations are:

  * CAW General Motors units

    -- Friday, May 16

       1) Local 1973
          Ciociaro Club, Salons A,B,C
          3745 N. Talbot Road
          Windsor, ON
          9:00am

       2) Local 199
          Brock University
          Bob Davis Gym
          500 Glenridge Ave
          St. Catharines, ON
          12:00 noon

       3) Local 222
          General Motors Centre
          99 Athol Street E.,
          Oshawa, ON
          3:00pm

    -- Saturday, May 17

       1) Local 636
          Local 636 Union Hall
          126 Beale Street
          Woodstock, ON
          9:30am

   * CAW Chrysler units

     -- Saturday, May 17

        1) Local 195
           CAW Local 195 Hall
           3400 Somme Avenue
           Windsor, ON
           7:00am, 1:00pm, 3:00pm

        2) Local 1459
           SCA Oplenac
           895 Rangeview Road
           Mississauga, ON
           (S. of Lakeshore, between Cawthra & Dixie)
           8:00am

        3) Local 1498
           CAW Local 444 union hall
           1855 Turner Road
           Windsor, ON
           10:00am

        4) Local 1285
           International Centre, Hall #1
           6900 Airport Road
           (Airport & Derry Road)
           Mississauga, ON
           10:30am

        5) Local 444
           University of Windsor
           401 Sunset Avenue
           St. Denis Hall
           Windsor, ON
           2:00pm

                           About Ford

Headquartered in Dearborn, Michigan, Ford Motor Co. (NYSE: F) --
http://www.ford.com/-- manufactures or distributes automobiles in
200 markets across six continents.  With about 260,000 employees
and about 100 plants worldwide, the company's core and affiliated
automotive brands include Ford, Jaguar, Land Rover, Lincoln,
Mercury, Volvo, Aston Martin, and Mazda.  The company provides
financial services through Ford Motor Credit Company.

The company has operations in Japan in the Asia Pacific region.
In Europe, the company maintains a presence in Sweden, and the
United Kingdom.  The company also distributes its brands in
various Latin American regions, including Argentina and Brazil.

                       About Chrysler

Headquartered in Auburn Hills, Michigan, Chrysler LLC --
http://www.chrysler.com/-- a unit of Cerberus Capital
Management LP, produces Chrysler, Jeep(R), Dodge and Mopar(R)
brand vehicles and products.  The company has dealers worldwide,
including Canada, Mexico, U.S., Germany, France, U.K.,
Argentina, Brazil, Venezuela, China, Japan and Australia.

                          About GM

Headquartered in Detroit, Michigan, General Motors Corp. (NYSE:
GM) -- http://www.gm.com/-- was founded in 1908.  GM employs
about 266,000 people around the world and manufactures cars and
trucks in 35 countries.  In 2007, nearly 9.37 million GM cars and
trucks were sold globally under the following brands: Buick,
Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel,
Pontiac, Saab, Saturn, Vauxhall and Wuling.  GM's OnStar
subsidiary is the industry leader in vehicle safety, security and
information services.

                           *     *     *

As reported in the Troubled Company Reporter on April 28, 2008,
Standard & Poor's Ratings Services said that its 'B' long-term and
'B-3' short-term corporate credit ratings on General Motors Corp.
remain on CreditWatch with negative implications, where they were
placed March 17, 2008.  The CreditWatch update follows downgrades
of 49%-owned subsidiaries GMAC LLC (B/Negative/C) and Residential
Capital LLC (CCC+/Watch Neg/C).  The rating actions on Residential
Capital LLC and GMAC were triggered by the resignation of the only
independent directors at Residential Capital LLC.


GENERAL MOTORS: CAW Balks at Announcement of Windsor Plant Closure
------------------------------------------------------------------
After General Motors Corp. disclosed that it will close its
Windsor Transmission plant in 2010, eliminating 1,400 jobs,
Canadian Auto Workers President Buzz Hargrove said he is both
frustrated and angered by the news.

"This decision came as an incredible shock," Mr. Hargrove said.  
"It will be devastating to our members, their families and the
community of Windsor."

The Windsor Transmission plant, which manufactures front-wheel-
drive, automatic transmissions and transmission components, is the
last of General Motors' operations in Windsor.  The closure will
mark the first time in decades that the company has not had a
presence in the community.

Mr. Hargrove said provincial politicians have expressed their
concern, but he also blasted the federal government for having
written off the auto industry, particularly Prime Minister Stephen
Harper, Industry Minister Jim Prentice and Finance Minister Jim
Flaherty.

"Until the federal Conservative government addresses the issues of
unfair trade, the ongoing loss of Big Three market share, the high
dollar and provides new investment supports, there will be more
layoffs and more plant closures," Mr. Hargrove said.

The CAW is currently in negotiations with General Motors, with a
final settlement depending largely on the company's commitment to
new products as well as improved pensions and severance packages
for the Windsor workforce.

"Our members have done everything they possibly can to ensure the
survival of the facility," plant chairperson Ken Bruner said.  
"It's up to our federal government to step in and support this
industry and stop unfair trade before it's too late."

Mr. Hargrove says that GM has an obligation to its Windsor
Transmission plant workers, citing consistently high levels of
quality and productivity.

"You simply can't negotiate your way out of scarcity,"  Mr.
Hargrove added.

This news comes just weeks after GM announced it will drop the
second production shift from the truck plant in Oshawa, Ontario,
eliminating close to 1,000 jobs, as reported in the Troubled
Company Reporter on April 30, 2008.

Headquartered in Detroit, Michigan, General Motors Corp. (NYSE:
GM) -- http://www.gm.com/-- was founded in 1908.  GM employs
about 266,000 people around the world and manufactures cars and
trucks in 35 countries.  In 2007, nearly 9.37 million GM cars and
trucks were sold globally under the following brands: Buick,
Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel,
Pontiac, Saab, Saturn, Vauxhall and Wuling.  GM's OnStar
subsidiary is the industry leader in vehicle safety, security and
information services.

                           *     *     *

As reported in the Troubled Company Reporter on April 28, 2008,
Standard & Poor's Ratings Services said that its 'B' long-term and
'B-3' short-term corporate credit ratings on General Motors Corp.
remain on CreditWatch with negative implications, where they were
placed March 17, 2008.  The CreditWatch update follows downgrades
of 49%-owned subsidiaries GMAC LLC (B/Negative/C) and Residential
Capital LLC (CCC+/Watch Neg/C).  The rating actions on Residential
Capital LLC and GMAC were triggered by the resignation of the only
independent directors at Residential Capital LLC.


GREAT LAKES: A.M. Best Puts bb- IC Rating Under Positive Review
---------------------------------------------------------------
A.M. Best Co. has placed the financial strength ratings of B-
(Fair) and issuer credit rating of "bb-" of Great Lakes Casualty
Insurance Company under review with positive implications.

The under review status with positive implications reflects the
effects on GLC's ratings of Main Street America Group's
announcement that a definitive agreement to purchase GLC from its
parent, Newco Financial Holdings, Inc., has been reached.

The ratings will remain under review pending further discussions
with the managements of GLC and MSA on GLC's future role within
MSA, as well as the conclusion of the agreement.  Prior to the
conclusion of the agreement, A.M. Best will continue to monitor
the unfolding situation and react as necessary.

MSA's FSR of A(Excellent) and ICR of "a" are unchanged.


HAWAIIAN AIRLINES: Settles Litigation Involving Mesa Air Group
--------------------------------------------------------------
Hawaiian Airlines reached late in April a settlement of its
lawsuit with Mesa Air Group, Inc., regarding Mesa's misuse of
confidential and proprietary information obtained during
Hawaiian's Chapter 11 plan of reorganization in 2004.

Mesa runs inter-island flight services operated under the go!
brand name.

Under the terms of the settlement and without admitting any
wrongdoing, Mesa will receive $37.5 million from a bond the
Company previously posted with the United States Bankruptcy Court
for the District of Hawaii.  Hawaiian Airlines will be entitled to
the remaining collateral of the Bond totaling $52.5 million.  

Mesa will withdraw its appeal of the $80 million judgment -- plus
interest, attorney's fees and costs -- awarded against Mesa by the
Bankruptcy Court in October 2007.  The cash payment is required to
be made within two business days of approval of a stipulation by
the bankruptcy court that will follow dismissal of the appeals.

The settlement does not restrict in any way go!'s ability to
continue to offer services in the Hawaiian interisland market.

Mark Dunkerley, Hawaiian's President and CEO, said, "This
settlement is the last chapter in the legal dispute over Mesa's
misuse of Hawaiian's confidential information. We were delighted
with the award of damages and this settlement."

On October 30, 2007, the Bankruptcy Court ruled in favor of
Hawaiian, awarding Hawaiian $80 million for damages incurred to
date and ordering that Mesa pay Hawaiian post-judgment interest
and its cost of litigation and reasonable attorneys fees.  In
November 2007, Mesa filed a notice of appeal to the ruling and was
required to post a $90 million bond as security for the judgment,
post judgment interest, and attorney's fees, pending the outcome
of the appeal.

As reported by the Troubled Company Reporter on Feb. 1, 2008, the
Hon. Robert Faris directed Mesa to pay Hawaiian Airlines Inc. $3.9
million for costs of litigation and attorneys' fees the carrier
incurred in their dispute over the misuse of confidential
information to gain an unfair competitive advantage.

The TCR said Nov. 2, 2007, that the $80 million in damages was
awarded to compensate Hawaiian for damages it suffered through
October 2007.  The court did not award damages for any injury
Hawaiian may sustain in the future as a result of Mesa's
misconduct.

                          About Mesa Air

Mesa currently operates 182 aircraft with over 1,000 daily system
departures to 157 cities, 42 states, the District of Columbia,
Canada, the Bahamas and Mexico. Mesa operates as Delta Connection,
US Airways Express and United Express under contractual agreements
with Delta Air Lines, US Airways and United Airlines, and
independently as Mesa Airlines and go!.  In June 2006 Mesa
launched inter-island Hawaiian service as go!  This operation
links Honolulu to the neighbor island airports of Hilo, Kahului,
Kona and Lihue.  The Company, founded by Larry and Janie Risley in
New Mexico in 1982, has approximately 5,000 employees and was
awarded Regional Airline of the Year by Air Transport World
magazine in 1992 and 2005. Mesa is a member of the Regional
Airline Association and Regional Aviation Partners.

                    About Hawaiian Airlines

Hawaiian Airlines, Inc. -- http://www.hawaiianair.com/-- a  
subsidiary of Hawaiian Holdings Inc. (Amex: HA), provides
passenger air service between the U.S. mainland and Hawaii.  The
company also offers nonstop service to Hawaii from more U.S.
gateway cities than any other airline, as well as service to the
Philippines, Australia, American Samoa, and Tahiti.  Hawaiian also
provides approximately 145 daily jet flights among the Hawaiian
Islands.

The company filed a voluntary petition for reorganization under
Chapter 11 of the United States Bankruptcy Code in the U.S.
Bankruptcy Court for the District of Hawaii (Case No. 03-00827) on
March 21, 2003.  Joshua Gotbaum served as the chapter 11 trustee
for Hawaiian Airlines, Inc.  Mr. Gotbaum was represented by Tom E.
Roesser, Esq., and Katherine G. Leonard, Esq., at Carlsmith Ball
LLP and Bruce Bennett, Esq., Sidney P. Levinson, Esq., Joshua D.
Morse, Esq., and John L. Jones, II, Esq., at Hennigan, Bennett &
Dorman LLP. The Bankruptcy Court confirmed the Chapter 11
Trustee's Plan of Reorganization on March 10, 2005.  The Plan took
effect on June 2, 2005.


HEXION SPECIALTY: March 31 Balance Sheet Upside Down by $1.3 Bil.
-----------------------------------------------------------------
Hexion Specialty Chemicals, Inc. reported its results for the
first quarter ended March 31, 2008. Highlights for the first
quarter of 2008 include:

   * Revenues of $1.64 billion in 2008 compared to $1.44 billion
     during the prior year period, an increase of 14 percent.

   * Operating income of $82 million for the first quarter of
     2008 versus $104 million for the comparable prior year
     period.  First quarter 2008 operating income was negatively
     impacted by $17 million in increased raw materials costs and
     $6 million from a Versatic Acids force majeure.

   * Net loss of $6 million for the 2008 quarter versus net
     income of $4 million in the first quarter of 2007.

   * Segment EBITDA (earnings before interest, taxes,
     depreciation and amortization) totaled $154 million in the
     first quarter of 2008 compared to $170 million during the
     prior year period, a 9 percent decrease.

   * Adjusted EBITDA was $678 million for the Last Twelve Month
     (LTM) period ended March 31, 2008.

"Demand for many of our key specialty products increased compared
to 2007 levels," said Craig O. Morrison, Chairman, President and
CEO. "Our strong quarterly sales gains reflect an ongoing focus on
pricing actions to offset rising raw material costs, continued
growth from international markets and our broad product portfolio.
In addition, the forest products business of Arkema GmbH, our most
recent acquisition, also performed well in its first full quarter
of operations within Hexion.

"We are focused on driving year-over-year sales and EBITDA gains.
Our first quarter 2008 Segment EBITDA, however, was negatively
impacted by $17 million in increased raw materials and $6 million
from a Versatic Acids force majeure. We are working diligently to
recover these raw material cost increases. We will continue to
address the challenging North American market conditions through
cost controls, synergy achievement and productivity initiatives,
as well as growing our international business, which represents
approximately 60 percent of our overall sales."

As of March 31, 2008, the company had total assets of $4.2 billion
and total liabilities of $5.5 billion, resulting in a
shareholders' deficit of $1.3 billion.  

                         Synergy Update

As part of its synergy program from the Hexion formation, the
Company achieved $6 million in synergies during the first quarter
of 2008. As of March 31, 2008, Hexion has achieved $126 million in
synergies from its synergy program targeting $175 million in
savings. The Company continues to expect to take all actions for
its synergy program by the end of 2008.

                      Transaction Update

Hexion previously announced in the first quarter of 2008 that both
it and Huntsman Corporation agreed to allow additional time for
the Federal Trade Commission to review the proposed merger of the
two companies. On April 5, 2008, Hexion exercised its option to
extend the Termination Date under the Merger Agreement until July
4, 2008.

"We continue to fully cooperate with regulatory agencies and are
working closely with Huntsman and the agencies in order to obtain
the regulatory approvals required to complete the merger,"
Morrison said.

On July 12, 2007, Hexion entered into a definitive agreement to
acquire Huntsman Corporation in an all-cash transaction valued at
approximately $10.6 billion, including the assumption of debt.
Under the terms of the Merger Agreement, the cash price per share
to be paid by Hexion increases each day from April 5, 2008 through
consummation of the merger at the equivalent of approximately 8%
per annum (less any dividends or distributions declared or made).
The transaction was approved by Huntsman shareholders on October
16, 2007 and is subject to customary closing conditions, including
regulatory approval in the U.S., European Union and several other
countries.

                         Segment Results

Following are net sales and Segment EBITDA by reportable segment
for the first quarter of 2008. Segment EBITDA is defined as EBITDA
adjusted to exclude certain non-cash and non-recurring expenses.
Segment EBITDA is the primary performance measure used by the
Company to evaluate operating results and allocate resources among
segments. Segment EBITDA is also the profitability measure used in
management and executive incentive compensation programs.
Corporate and Other primarily represents certain corporate,
general and administrative expenses that are not allocated to the
segments.
      
(U.S. Dollars in Millions)               (Unaudited)
                                   Three months ended March 31,
                                         2008            2007  
                                   ----------------------------
Net Sales to Unaffiliated Customers
  Epoxy and Phenolic Resins              $639            $567   
  Formaldehyde and Forest Product Resins  554             428   
  Coatings and Inks                       332             343   
  Performance Products                    111             100     
                                   ----------------------------
                                       $1,636          $1,438     
      
Segment EBITDA:     
  Epoxy and Phenolic Resins               $74             $95   
  Formaldehyde and Forest Product Resins   53              44   
  Coatings and Inks                        19              25   
  Performance Products                     21              18   
  Corporate and Other                     (13)            (12)

                          Earnings Call

Hexion Specialty Chemicals, Inc. hosted a teleconference to
discuss First Quarter 2008 results on May 14, 2008.  A replay of
the call will be available for three weeks beginning at 12 p.m.
Eastern Time on May 14, 2008.  The playback can be accessed by
dialing 888-286-8010 (U.S.) and 617-801-6888 (International).  The
passcode is 67271444. A replay also will be available through the
Investor Relations Section of the Company's Web site.

                     About Hexion Specialty

Based in Columbus, Ohio, Hexion Specialty Chemicals Inc. --
http://www.hexionchem.com/-- is a producer of thermosetting   
resins, or thermosets.  Thermosets are a critical ingredient in
virtually all paints, coatings, glues and other adhesives produced
for consumer or industrial uses.   Hexion Specialty Chemicals is
controlled by an affiliate of Apollo Management L.P.


IDLEAIRE TECH: Files for Chapter 11 Protection in Delaware
----------------------------------------------------------
IdleAire Technologies Corp. filed for Chapter 11 protection with
the U.S. Bankruptcy Court for the District of Delaware.

The company expected a net loss of $93 million on $37 million of
total revenues, WVLT-TV reports, citing one of the company's
filings with the U.S. Securities and Exchange Commission.  
Knoxvillebiz.com also relates that the company was restricted in
its borrowing opportunities, and subsequently blamed its
bankruptcy filing on the credit crisis.

"So everything came apart and I don't blame them, but my goodness
it is a tough one," Knoxvillebiz.com quotes company investor David
Coffey as saying.

According to Knoxvillebiz.com, the company hunted for financing
after "market uncertainties" made underwriters withdraw from a
planned IPO.  The company initially had 11 investors, but all of
them declined to give financing.

"Given its inability to raise operating capital, IdleAire's
management has determined in its reasonable business judgment that
it is in the best interests of all stakeholders to commence a
Chapter 11 case," Knoxvillebiz.com says, citing the company's
court filing.

Based in Knoxville, Tennessee, IdleAire Technologies Corp. --
http://www.idleaire.com/-- manufactures and services an advanced  
travel center electrification system providing heating,
ventilation & air conditioning, Internet and other services to
truck drivers parked at rest stops.

The company filed for Chapter 11 protection on May 12, 2008
(Bankr. D. Del. Case No. 08-10960).  Elihu Ezekiel Allinson, III,
Esq., William A. Hazeltine, Esq., and William David Sullivan,
Esq., at Sullivan Hazeltine Allinson LLC, represent the Debtor in
its restructuring efforts.  When the Debtor filed for protection
from its creditors, it listed total assets of $210,879,000 and
total debts of $303,616,000.


IDLEAIRE TECHNOLOGIES: Wants to Use $8 Million DIP Facility
-----------------------------------------------------------
IdleAire Technologies Corp. asked authority from the U.S.
Bankruptcy Court for the District of Delaware to obtain $8 million
in postpetition secured debt on an interim basis.

On behalf of an investor group, Wells Fargo NA, administrative and
collateral agent, agreed to provide the Debtor with up to
$25 million cash advances and other extensions of credit on a
priming senior secured revolving basis pursuant to the terms of a
debtor-in-possession financing agreement.

The DIP facility bears a 15% interest per annum, payable in kind
until maturity, with a 2% upward adjustment in the event of a
default.  The DIP facility matures in the earlier of (i) July 18,
2008, unless extended, (ii) the consummation of an approved sale,
(iii) the effective date of the plan of reorganization, (iv) the
date the total commitment is terminated, (v) the acceptance by the
borrower of offer or bid from a buyer that does not provide for
the actual payment in full of the Debtor's obligations, or (vi)
unless waived by the lenders in their sole discretion.

The Debtor said that the DIP facility should allow the Debtor to
continue its operations but only for the short-term.  A projected
period of continuing operating losses suggests that the only
viable long-term solution -- to preserve the value of its assets,
its 1,200 employees, and its business -- is through a sale
pursuant to Section 363 of the U.S. Bankruptcy Code.

A separate story on the Debtor's motion to sell its assets to an
investor group is in today's copy of the Troubled Company
Reporter.

        Investor Group is Proposed Purchaser and DIP Lender

After unsuccessful efforts to sell assets prior to bankruptcy
filing, the Debtor's board determined that it was best for
creditors if IdleAire files for bankruptcy in order to sell
substantially all of the Debtor's assets to a proposed purchaser.

IdleAire Acquisition Company LLC, the proposed purchaser, is a
Delaware limited liability corporation comprised by various
investors, including Airlie Opportunity Master Fund Ltd., Kenmont
Special Opportunities Master Fund LP, Miesque Fund Limited, SV
Special Situations Master Fund Ltd., Pierce Diversified Trading
Strategy Fund LLC, Whitebox Hedged High Yield Partners LP, Wilfrid
Aubrey Growth Fund LP and Wilfrid Aubrey International Limited.

The proposed purchaser agrees to acquire the Debtor's assets for
$10 million, plus assumption of some liabilities.  The investors
agreed to (i) provide up to $25 million of postpetition financing,
(ii) hold a prepetition claim secured by a lien on all of the
Debtor's assets in the principal amount of $3.7 million, and (iii)
assert a right to direct Wells Fargo, the indenture trustee of 13%
secured discount notes to credit bid up to about $320 million of
the notes.

                          About IdleAire

Knoxville, Tennessee-based IdleAire Technologies Corp. --
http://www.idleaire.com/-- is a privately held corporation  
founded in June 2000.  It manufactures and services an advanced
travel center electrification system providing heating,
ventilation & air conditioning, Internet and other services to
truck drivers parked at rest stops.  The company delivers its
services to long-haul drivers through its patented Advanced Travel
Center Electrification(R) system, or ATE system, comprised of an
in-cab service module connected to an external heating,
ventilation and air conditioning unit, or HVAC unit, mounted on a
truss structure above parking spaces.  It employs about 1,200
people.

The company filed chapter 11 petition on May 12, 2008 (Bankr. D.
Del. Case No. 08-10960).  Judge Kevin Gross presides over the
case.  Elihu Ezekiel Allinson, III, Esq., William A. Hazeltine,
Esq., and William David Sullivan, Esq., at Sullivan Hazeltine
Allinson, LLC represent the Debtor in its restructuring efforts.  
The Debtor asked the Court to hire professionals at Holland &
Knight LLP as its counsels.  As of Dec. 31, 2007, the Debtor had
total assets of $210,879,000 and total debts of $303,616,000.


IDLEAIRE TECHNOLOGIES: Depleting Cash Cues Sale to Investor Group
-----------------------------------------------------------------
IdleAire Technologies Corp. told the U.S. Bankruptcy Court for the
District of Delaware that it is close to exhausting its cash
resources, and needs to sell its assets.  The Debtor added that it
does not believe it will be able to continue its business unless
it receives a cash infusion, which certain members of the majority
secured noteholder group or debtor-in-possession lenders have
agreed to provide pursuant to a postpetition credit agreement.

A separate story on the Debtor's request to use its lenders' DIP
facility is in today's copy of the Troubled Company Reporter.

The Debtor said that the DIP facility should allow the Debtor to
continue its operations but only for the short-term.  A projected
period of continuing operating losses suggests that the only
viable long-term solution -- to preserve the value of its assets,
its 1,200 employees, and its business -- is through a sale
pursuant to Section 363 of the U.S. Bankruptcy Code.

             Marketing Efforts and Proposed Purchaser

The Debtor informed the Court that prior to the bankruptcy filing,
it engaged KPMG Corporate Finance to, among others, identify
prospective funding sources for the Debtor's business.  The
Debtor, through KPMG's assistance, contacted 11 potential funding
sources.  A number of parties executed confidentiality agreements
and were provided private placement memorandum and due diligence
materials.  In the course of discussions with the potential
funding sources, some parties expressed interest in some of the
Debtor's assets.  However, no party offered definitive terms as to
either funding or acquisition.

The Debtor's board determined that it was best for creditors if
IdleAire to file for bankruptcy in order to give effect to the
transaction to sell substantially all of the Debtor's assets to a
proposed purchaser.

IdleAire Acquisition Company LLC, the proposed purchaser, made
clear to the Debtor that it is unwilling to either (i) advance
additional funding or (ii) consummate the transaction contemplated
by the a sale term sheet outside a chapter 11 proceeding due to
numerous uncertainties.  However, the proposed purchaser said it
is willing to act as stalking horse bidder.

IdleAire Acquisition is a Delaware limited liability corporation
comprised by various investors, including Airlie Opportunity
Master Fund Ltd., Kenmont Special Opportunities Master Fund LP,
Miesque Fund Limited, SV Special Situations Master Fund Ltd.,
Pierce Diversified Trading Strategy Fund LLC, Whitebox Hedged High
Yield Partners LP, Wilfrid Aubrey Growth Fund LP and Wilfrid
Aubrey International Limited.

The proposed purchaser agrees to acquire the Debtor's assets for
$10 million, plus assumption of some liabilities.  The investors
agreed to (i) provide up to $25 million of postpetition financing,
(ii) hold a prepetition claim secured by a lien on all of the
Debtor's assets in the principal amount of $3.7 million, and (iii)
assert a right to direct Wells Fargo, the indenture trustee of 13%
secured discount notes to credit bid up to about $320 million of
the notes.

                        Proposed Deadlines

The Debtor proposed that these deadlines be set:

   a. entry of bid procedures order no later than three business
      days following the petition date, or May 15, 2008;

   b. prospective bidder execution of non-disclosure agreements
      within 30 days of the petition date, or June 11, 2008;

   c. submission of overbids within 50 days of the petition date,
      or July 1, 2008;

   d. auction within two days of bid deadline, or July 3, 2008;

   e. sale hearing within two business days of bid deadline, or
      July 8, 2008;

   f. closing of sale no later than July 18, 2008.

                          About IdleAire

Knoxville, Tennessee-based IdleAire Technologies Corp. --
http://www.idleaire.com/-- is a privately held corporation  
founded in June 2000.  It manufactures and services an advanced
travel center electrification system providing heating,
ventilation & air conditioning, Internet and other services to
truck drivers parked at rest stops.  The company delivers its
services to long-haul drivers through its patented Advanced Travel
Center Electrification(R) system, or ATE system, comprised of an
in-cab service module connected to an external heating,
ventilation and air conditioning unit, or HVAC unit, mounted on a
truss structure above parking spaces.  It employs about 1,200
people.

The company filed chapter 11 petition on May 12, 2008 (Bankr. D.
Del. Case No. 08-10960).  Judge Kevin Gross presides over the
case.  Elihu Ezekiel Allinson, III, Esq., William A. Hazeltine,
Esq., and William David Sullivan, Esq., at Sullivan Hazeltine
Allinson, LLC represent the Debtor in its restructuring efforts.  
The Debtor asked the Court to hire professionals at Holland &
Knight LLP as its counsels.  As of Dec. 31, 2007, the Debtor had
total assets of $210,879,000 and total debts of $303,616,000.


IDLEAIRE TECHNOLOGIES: To Engage Kurtzman Carson as Claims Agent
----------------------------------------------------------------
IdleAire Technologies Corp. asked authority from the U.S.
Bankruptcy Court for the District of Delaware to employ Kurtzman
Carson Consultants LLC as its claims, noticing and balloting
agent.

KCC will, on behalf of the Debtor and the Office of the Clerk for
the U.S. Bankruptcy Court, (i) transmit designated and required
notices to appropriate parties, (ii) maintain copies of proofs of
claim and proofs of interest, (iii) maintain the official claims
register, (iv) assist the Debtor with the dissemination of
solicitation materials relating to plan and ballot tabulation, (v)
provide computerized claims, claims objection and balloting
database services, and (vi) provide other relevant administrative
services.

The Debtor said that KCC has a wealth of experience in serving as
claims and notice agent, and is providing and has provided similar
services to chapter 11 debtors, including Charys Holding Company
Inc., Pac-West Telecom Inc., and Matress Gallery.

Basedon KKC Agreement for Services, the Debtor agrees to reimburse
or pay for KKC's incurred costs related to third party items.  
Where the fee for these items is expected to exceed $10,000 in a
single month, an advance payment may be required.  The Debtor
agrees to pay a $50,000 retainer to KKC.  The agent's specific
charges were not disclosed.

The Debtor assured the Court that KCC is a disinterested person
and does not represent any interest to the Debtor's estate.

The firm can be reached at:

   Kurtzman Carson Consultants LLC
   2335 Alaska Avenue
   El Segundo, CA 90245
   Attn: James M. Le
   Tel: (310) 823-9000
   Fax: (310) 823-9133

                          About IdleAire

Knoxville, Tennessee-based IdleAire Technologies Corp. --
http://www.idleaire.com/-- is a privately held corporation  
founded in June 2000.  It manufactures and services an advanced
travel center electrification system providing heating,
ventilation & air conditioning, Internet and other services to
truck drivers parked at rest stops.  The company delivers its
services to long-haul drivers through its patented Advanced Travel
Center Electrification(R) system, or ATE system, comprised of an
in-cab service module connected to an external heating,
ventilation and air conditioning unit, or HVAC unit, mounted on a
truss structure above parking spaces.  It employs about 1,200
people.

The company filed chapter 11 petition on May 12, 2008 (Bankr. D.
Del. Case No. 08-10960).  Judge Kevin Gross presides over the
case.  Elihu Ezekiel Allinson, III, Esq., William A. Hazeltine,
Esq., and William David Sullivan, Esq., at Sullivan Hazeltine
Allinson, LLC represent the Debtor in its restructuring efforts.  
As of Dec. 31, 2007, the Debtor had total assets of $210,879,000
and total debts of $303,616,000.


IDLEAIRE TECHNOLOGIES: Taps CRG's Stephen Gray as CRO
-----------------------------------------------------
IdleAire Technologies Corp. asked authority from the U.S.
Bankruptcy Court for the District of Delaware to employ CRG
Partners Group LLC as crisis manager and Stephen S. Gray as its
chief restructuring officer.

CRG and Mr. Gray are expected to assist the Debtor in its
restructuring efforts, effective as of the bankruptcy filing.

As CRO, Mr. Gray will (i) be responsible for day-to-day management
and operational issues of the Debtor, (ii) will assist in the
evaluation of the Debtor's options for maximizing the value of its
assets, (iii) assist with the formulation, negotiation and
consummation of a possible sale of the Debtor or its assets, and
(iv) assist the Debtor with the formulation, negotiation and
promulgation of a plan of reorganization or liquidation.

As crisis manager, CRG and its employees will provide, among
others, financial and operational analysis of the Debtor's current
and potential profitability, ongoing cash requirements, profit
center distributions and break-even levels.  CRG will also assist
with lender negotiations, and enhancement of liquidity issues.

According to the Debtor, CRG is a nationally recognized turn-
around and crisis management firm with skilled managers and
advisors that provide a comprehensive range of interim management,
consulting and financial advisory services.

The Debtor also said that Mr. Gray has substantial amount of
experience in advising troubled companies regarding operational
and financial issues.  He was the founder of The Recovery Group,
one of CRG's predecessor firms, and has over 30 years working as a
turnaround consultant and crisis manager.

Mr. Gray charges $580 per hour and CRG's other professionals
charge $275 to $550 per hour depending on the level of experience.  
In addition, CRG will bill an administrative fee of 4.5% of its
professional fees.  The Debtor paid CRG $100,000 retainer.

To the best of the Debtor's knowledge, CRG and Mr. Gray are
disinterested persons as that term is defined in the Bankruptcy
Code.

The firm can be reached at:

   CRG Partners Group LLC
   2 Atlantic Ave.
   Boston, MA 02110
   Tel: (617) 482-4242
   http://www.crgpartners.com/

                          About IdleAire

Knoxville, Tennessee-based IdleAire Technologies Corp. --
http://www.idleaire.com/-- is a privately held corporation  
founded in June 2000.  It manufactures and services an advanced
travel center electrification system providing heating,
ventilation & air conditioning, Internet and other services to
truck drivers parked at rest stops.  The company delivers its
services to long-haul drivers through its patented Advanced Travel
Center Electrification(R) system, or ATE system, comprised of an
in-cab service module connected to an external heating,
ventilation and air conditioning unit, or HVAC unit, mounted on a
truss structure above parking spaces.  It employs about 1,200
people.

The company filed chapter 11 petition on May 12, 2008 (Bankr. D.
Del. Case No. 08-10960).  Judge Kevin Gross presides over the
case.  Elihu Ezekiel Allinson, III, Esq., William A. Hazeltine,
Esq., and William David Sullivan, Esq., at Sullivan Hazeltine
Allinson, LLC represent the Debtor in its restructuring efforts.  
As of Dec. 31, 2007, the Debtor had total assets of $210,879,000
and total debts of $303,616,000.


INTERTAPE POLYMER: Posts $2MM Net Loss in Quarter ended March 31
----------------------------------------------------------------
Intertape Polymer Group Inc. reported net loss of $1.9 million for
the first quarter compared to a net loss of $600,000 for the first
quarter of 2007.

Non-recurring items in the first quarter were related to the
refinancing of the existing Senior Secured Credit Facility and
included both the noncash write-off of debt issue expenses of
$3.1 million and the settlement of the interest rate swap
agreements at a cost of $2.9 million.

Cash flow from operations before changes in non-cash working
capital items provided liquidity of $9.5 million for the first
quarter of 2008 compared to $7.8 million for the first quarter of
2007.  The improvement essentially reflects profit improvement,
despite a $2.9 million charge for the settlement of the interest
rate swap agreements.

Changes in non-cash working capital items used $12.3 million for
the first quarter of 2008 compared to using $1.5 million during
the same period in 2007.  The greater cash use in the first
quarter of 2008 results from increases in trade accounts
receivable and inventories and a reduction in accounts payable and
accrued liabilities from year-end levels.

As a result, operating activities used cash of $2.8 million for
the first quarter of 2008 compared to providing liquidity of
$6.3 million for the first quarter of 2007.

At March 31, 2008, the company's balance sheet showed total assets
of $697.2 million, total liabilities of $342.7 million and total
shareholders' equity of $354.5 million.

                   About Intertape Polymer Group

Based in Montreal, Quebec and Sarasota/Bradenton, Florida,
Intertape Polymer Group Inc. (NYSE,ITP; TSX: ITP.TO) --   
http://www.intertapepolymer.com/-- develops and manufactures    
specialized polyolefin plastic and paper-based packaging products
and complementary packaging systems for industrial and retail use.  
The company employs approximately 2,100 employees with operations
in 17 locations, including 13 manufacturing facilities in North
America and one in Europe.

                          *     *     *

As reported in the Troubled Company Reporter on Dec. 26, 2007,
Standard & Poor's Ratings Services raised its rating on
Intertape's senior subordinated notes to 'CCC+' from 'CCC'.


IRVINE SENSORS: Sells More Than 1% of Shares in Unregistered Deals
------------------------------------------------------------------
Irvine Sensors Corporation has issued:

   (i) 100,000 shares of common stock to an accredited
       institutional investor upon such investor's conversion on
       April 30, 2008 of $30,000 of the stated value of the Series
       A-1 10% Cumulative Convertible Preferred Stock of the
       company and

  (ii) 333,333 shares of common stock to the same accredited
       institutional investor upon such investor's conversion on
       May 5, 2008 of $100,000 of the stated value of the Series
       A-1 Stock of the company.

As a result of the conversion on May 5, 2008, the company has
issued more than 1% of its outstanding shares of common stock in
unregistered transactions in the aggregate, according to a
Securities and Exhange Commission filing.

The sales of shares of common stock have been determined to be
exempt from registration under the Securities Act of 1933 in
reliance on Section 4(2) of the Securities Act and Rule 506 of
Regulation D promulgated thereunder, as transactions by an issuer
not involving a public offering.  The investor has represented
that it is an accredited investor, as that term is defined in
Regulation D, and that it has acquired the securities for
investment purposes only and not with a view to or for sale in
connection with any distribution.

Based in Costa Mesa, California, Irvine Sensors Corporation
(Nasdaq: IRSN) -- http://www.irvine-sensors.com/-- is a vision   
systems company engaged in the development and sale of
miniaturized infrared and electro-optical cameras, image
processors and stacked chip assemblies, the manufacture and sale
of optical systems and equipment for military applications through
its Optex subsidiary and research and development related to high
density electronics, miniaturized sensors, optical interconnection
technology, high speed network security, image processing and low-
power analog and mixed-signal integrated circuits for diverse
systems applications.

                           *     *     *

As reported in the Troubled Company Reporter on Jan. 24, 2008,
Grant Thornton LLP expressed substantial doubt about Irvine
Sensors Corp.'s ability to continue as a going concern after
auditing the company's financial statements for the year ended
Sept. 30, 2007.

The auditing firm reported that the company incurred net losses
for the years ended Sept. 30, 2007, Oct. 1, 2006 and Oct. 2, 2005,
respectively, and the company has working capital of only
$1,799,100 at Sept. 30, 2007.


JABIL CIRCUIT: Moody's Rtng Unmoved by Planned $150MM Notes Add-On
------------------------------------------------------------------
Moody's Investors Service commented that Jabil Circuit, Inc.'s Ba1
corporate family and senior unsecured debt ratings, SGL-1
speculative grade liquidity rating and negative outlook would not
be affected by the company's recent announcement that it intends
to offer up to $150 million of add-on 10-year senior notes.  The
terms of the proposed issue will be identical to the company's
$250 million 8.25% senior unsecured notes due 2018 (rated Ba1).

Jabil plans to issue up to $150 million senior unsecured notes as
an add-on to its $250 million senior note issue that was placed in
January 2008.  Jabil expects to use the net add-on proceeds to
replenish cash balances, which were used in conjunction with
proceeds from the $250 million note issue to repay short-term debt
incurred in connection with the purchase of Taiwan Green Point
(Green Point).

While the add-on note issue modestly increases the company's
overall leverage profile, Moody's believes Jabil has capacity at
the current rating level to incur the additional debt.  On a pro
forma basis, Moody's estimates Jabil's debt to EBITDA has
increased to 3.2x from 2.8x as of the twelve months ended February
2008.  The incremental debt combined with expectations of
diminished free cash flow limits financial flexibility and weakly
positions the company in the Ba1 rating category.

Jabil's Ba1 corporate family rating reflects the highly
competitive pricing pressures and inherent volatility that
currently plague the EMS industry, as well as rising capex and
working capital requirements associated with Jabil's transition to
a more vertically integrated business model to compete more
effectively against its competitors.  The rating also reflects the
company's mid-single digit gross margins, ongoing large-scale
restructuring program, exposure to the currently weak consumer
segment, unfavorable product mix and the winding down of legacy
OEM programs, ahead of full ramp-up of higher margin vertical
programs, which are expected to pressure revenue growth rates and
margins.

At the same time, Jabil's CFR is supported by its Tier 1 industry
leadership status and solid market position, benefiting from the
secular OEM outsourcing trend, its global manufacturing footprint
with facilities located near OEM customer sites and its focus on
end-to-end solutions, mechanical engineering, vertical component
production and emerging EMS segments with higher margin/low volume
characteristics.  Consideration is also given to the company's
manufacturing facilities in low labor cost regions as well as its
strong liquidity profile.

The negative outlook reflects Jabil's lower revenue and
profitability outlook stemming from a weaker than expected demand
environment, particularly in the company's consumer electronics
(roughly one-third of revenues) and automotive segments, reduced
cash flow generation prospects over the next several quarters, as
well as continued challenges in the overall EMS space, which has
been impacted by excess capacity, increasing competition, customer
attrition and execution missteps.  The negative outlook also
considers a weaker margin profile in the near-to-intermediate term
led by gross margin decline in the company's consumer division
coupled with the possibility of further restructuring actions that
will depress already thin operating margins; expectations of capex
above historical levels; and integration risks associated with
Green Point.  

Finally, the negative outlook considers the possibility of further
debt-funded acquisitions as the company seeks to advance its
market position against competitors in the EMS space.

Moody's will monitor closely the company's market position,
operating margin trends, working capital metrics and free cash
flow generation and notes that ratings could be downgraded over
the next 6 -- 9 months if the company experiences: (i) material
customer/program losses without offsetting increases in new
customer wins/program ramps; (ii) a continued decline in operating
margins (excluding restructuring/impairment costs and amortization
of intangibles) below 2% over the next 2 - 3 quarters; (iii)
extended weakness in its consumer electronics business resulting
in continued revenue contraction, operating losses or operating
margins below 1% for this segment; (iv) a significant
deterioration in the company's cash position from current levels;
(v) higher than expected restructuring charges; (vi) an inability
to internally fund capex and working capital, resulting in
sustained negative free cash flow; or (vii) a notable increase in
financial leverage, as measured by debt to EBITDA (Moody's
adjusted) above 3.8x.

Jabil's SGL-1 rating reflects its very good liquidity position. As
of Feb. 29, 2008, Jabil maintained roughly $531 million of cash.  
Although free cash flow was negative $228 million for fiscal 2007,
the company generated $328 million of positive free cash flow in
the recent LTM.  Jabil is expected to produce moderate levels free
cash flow in the near term, albeit at lower than expected levels
due to weaker revenue and profitability, and higher capex.  The
company currently has access to an undrawn $800 million revolver.
Including the incremental debt associated with the add-on note
issue, Moody's expects the company to remain in compliance with
its financial covenants.

Jabil Circuit, Inc., headquartered in St. Petersburg, Florida, is
an electronic product solutions company providing comprehensive
electronics design, manufacturing and product management services
to global electronics and technology companies.


JETBLUE AIRWAYS: Fitch Cuts Sr. Unsec. Notes' Rating to CCC-/RR6
----------------------------------------------------------------
Fitch Ratings has downgraded the debt ratings of JetBlue Airways
Corp. (JBLU):

   -- Issuer Default Rating (IDR) to 'B-' from 'B';

   -- Senior unsecured convertible notes to 'CCC-/RR6' from
      'CCC/RR6'.

This action affects approximately $425 million of outstanding
debt. The Rating Outlook for JetBlue is Negative.

Fitch's downgrade follows the dramatic run-up in jet fuel costs
and growing evidence of a softening revenue outlook that will
likely drive larger losses and weakened free cash flow during the
remainder of 2008. Although the $300 million equity investment by
Germany's Deutsche Lufthansa AG helped boost JBLU's liquidity
position in the first quarter, Fitch expects cash balances to
remain under pressure over the next several months as JBLU and the
other U.S. airlines continue to trim unprofitable capacity in the
face of unsustainably high jet fuel prices. While JBLU's fleet
plan flexibility provides some opportunity to manage capacity
growth lower in 2008 and 2009, additional cash-raising options are
limited, and the carrier's liquidity cushion will likely be eroded
somewhat as operating losses continue and debt maturities are met
without the benefit of positive free cash flow.

The 'B-' IDR reflects JBLU's highly leveraged capital structure,
its diminished cash flow generation capacity and its vulnerability
to ongoing fuel and revenue shocks in an industry that remains
unable to recover surging and largely uncontrollable energy costs
through higher fares. Importantly, the rating also captures the
fact that JBLU's current liquidity position is adequate to meet
2008 fixed obligations, but intense fuel cost pressure and
worsening unit revenue comparisons through the year will likely
reduce cash balances by year-end. In addition to scheduled
aircraft-backed debt principal payments this year, JBLU will fund
$175 million in convertible notes that investors can put back to
the company on July 15. Total scheduled debt maturities for the
final three quarters of 2008 are $343 million. Besides the
Lufthansa investment proceeds booked in January, liquidity will be
supplemented by the sale of nine used Airbus A320 aircraft this
year. These sales could generate as much as $100 million in cash
after repayment of associated aircraft debt. All A320 and Embraer
E190 aircraft deliveries for 2008 are financed, and JBLU may be
able to defer some upcoming scheduled deliveries in order to
reduce debt-financed aircraft capital spending while conserving
cash tied to pre-delivery deposits.

Including currently illiquid auction rate securities ($284 million
on the March 31 balance sheet) which may be sold in coming months
if auctions for these securities are successful, JBLU's total cash
balance stood at $1.0 billion at the end of the first quarter.
Supplemental sources of liquidity are constrained, however, and
JBLU has no revolving credit facility in place. Looking ahead to
2009, JBLU faces a more manageable level of scheduled debt
maturities ($159 million). However, adverse fuel and revenue
developments could force JBLU to explore further capital-raising
options-including the sale of its LiveTV in-flight entertainment
subsidiary, monetization of equity in owned A320 aircraft or new
equity capital beyond the $300 million already invested by
Lufthansa.

During first quarter (Q1), JBLU paid $118 million more for fuel
than it did a year ago, and the outlook for Q2 and Q3 (based on
the current forward curve) is discouraging. For each 10-cent move
in the price of jet fuel, JBLU faces approximately $45 million of
annual cost pressure. Using the company's latest guidance of $3.05
per gallon for the full year 2008, therefore, fuel costs alone
would rise by approximately $500 million in 2008 vs. 2007. Through
April 17, JBLU had hedged 46% of expected Q2 fuel consumption
through a combination of heating oil collars (11% of total
consumption with upside protection at $2.19 per gallon) and
heating oil swaps (35% of expected consumption at an average price
of $2.56 per gallon).

Management has again signaled its willingness to slow growth and
trim unprofitable flying in an effort to stem cash outflows. This
follows two years in which capacity growth rates were pulled back
through the sale of used A320s and the deferral of some new
aircraft deliveries. The latest capacity guidance for 2008 calls
for growth of 3% to 5%, down from 6% to 8% before the most recent
spike in fuel costs. To meet this capacity target, JBLU plans to
sell nine used A320 aircraft this year and another one in 2009. In
light of good secondary market demand and positive net cash flow
on each A320 sale, this remains a workable safety valve to manage
available seat mile (ASM) capacity down in a worsening operating
environment. These aircraft sales, together with announced
domestic schedule cuts by other carriers, should support revenue
per ASM performance somewhat later in the year. However, sluggish
U.S. economic growth this year will likely erode air travel demand
further-limiting opportunities to fully cover rising jet fuel
costs through higher fares.

Despite the fact that JBLU has an almost entirely domestic route
network, unit revenue performance in Q1 topped that of the U.S.
legacy carriers by a significant margin. This was due in part to
very weak revenue per ASM performance in Q107 during the storm-
related operational break-down last year. For the remainder of
2008, a continuation of solid unit revenue growth will be required
to offset an expected unit cost increase of 20% to 22% for the
full year (assuming 2008 jet fuel prices of $3.05 per gallon).
Revenue per ASM growth will be supported by industry-wide fare
moves that are boosting yields as load factors and traffic come
under some pressure due to higher fares and slowing U.S. economic
growth. In its April traffic release, JBLU reported a 5.2 point
decline in its monthly load factor, while RASM increased by 3% as
average fares increased on 7% growth in ASM capacity. While summer
bookings appear strong, JBLU and the rest of the industry can
expect to feel intense revenue pressure after August, as seasonal
demand patterns shift. Importantly, this is the point at which
announced domestic capacity reduction throughout the U.S. industry
will begin to take full effect.

A further downgrade into the 'CCC' category could follow if the
sharp deterioration of operating trends seen since the start of
the year continues over the next few months, and if an extension
of tight credit market conditions limits JBLU's ability to raise
capital as cash balances are reduced further in the face of
extreme fuel cost pressure.


JOURNAL REGISTER: Posts $72MM Net Loss in Quarter Ended March 30
----------------------------------------------------------------
Journal Register Company reported a net loss of $72.2 million for
the first quarter ended March 30, 2008, as compared to income from
continuing operations of $1.5 million for the prior year quarter
ended April 1, 2007.

The net loss for the period includes a $95.4 million,
$70.2 million net of tax, non-cash charge for the impairment of
assets.  This charge relates to a write-down of the carrying value
of mastheads and goodwill for the Michigan and New York clusters.

The first quarter of 2007 included a loss from discontinued
operations and a gain on the sales of our New England cluster
properties in February of 2007.  Net income for the 2007 first
quarter was $29.1 million.

Excluding non-cash impairment charges and the other items, the
2008 first quarter loss would have been $2.0 million as compared
to net income from continuing operations of $1.5 million for the
prior year quarter ended April 1, 2007.

       Debt, Interest Expense and other Financial Information

The company again amended its credit facility and covenants to
increase liquidity during these difficult times for the newspaper
industry.  The company's next debt amortization payment is due in
the second quarter of 2009.  The company's effective interest rate
was 7.3% for the first quarter 2008 compared to 7.0% for fourth
quarter and 6.2% for the first quarter of 2007.

The company's capital expenditures were $0.8 million for the first
quarter of 2008.  Those expenditures included production equipment
and spending for technological and online improvements.
Additionally, during the first quarter of 2008, the company sold
its distribution center property in Milford, Connecticut for a
gain of $0.4 million.

                             Liquidity

The company was in compliance with the total leverage financial
covenant contained in the Amended Credit Agreement for the fiscal
quarter ending March 30, 2008, under the terms of the Second
Amendment.  

At March 30, 2008, the company had cash of approximately
$15.9 million and approximately $12.5 million available under the
Amended Credit Agreement.  There can be no assurances that this
will remain sufficient to meet the company's operating needs.

At March 30, 2008, the company's balance sheet showed total assets
of $841.5 million, total liabilities of $828.8 million and total
stockholders" equity of $12.7 million

                  About Journal Register company

Headquartered in Yardley, Pennsylvania, Journal Register company
(NYSE:JRC)-- http://www.journalregister.com-- owns and operates    
27 daily newspapers and 368 non-daily publications as of Dec. 31,
2006.  The company also operates 239 individual websites that are
affiliated with the company's daily newspapers, non-daily
publications and its network of employment websites.  All of the
company's operations are clustered in seven geographic areas:
Greater Philadelphia, Michigan, Connecticut, Greater Cleveland,
New England, and the Capital-Saratoga and Mid-Hudson regions of
New York.  The company owns JobsInTheUS, a network of 19
employment websites and three commercial printing operations.  The
company's total paid circulation is approximately 616,000 daily,
635,000 Sunday and its total non-daily distribution is
approximately 6.4 million.  In February 2007, the company sold two
of its New England Cluster daily community newspapers to Gatehouse
Media.

                           *     *     *

As reported in the Troubled Company Reporter on May 8, 2008,
Standard & Poor's Ratings Services lowered its rating on Journal
Register Co.; the corporate credit rating was lowered to 'CCC'
from 'B-'.  The ratings were removed from CreditWatch, where they
were placed with negative implications on April 7, 2008.  The
rating outlook is negative.


JOURNAL REGISTER: Moody's Junks Rating on Likely Covenant Breach
----------------------------------------------------------------
Moody's Investors Service has downgraded Journal Register
Company's Corporate Family rating to Caa2 from B3, and its
Probability of default rating to Caa3 from Caa1, following
management's disclosure that it is probable that the company will
be in violation of the total leverage financial covenant
calculation under its senior secured credit agreement (as amended)
as of July 23, 2008 unless there is significant improvement in
operating results during the second fiscal quarter or the Company
is successful in obtaining an additional amendment.

Details of the rating actions are:

Ratings downgraded:

  -- $150 million senior secured revolving credit facility due
     2012 -- to Caa2, LGD3, 34% from B3, LGD3, 33%

  -- $543 million senior secured term loan A due 2012 -- to Caa2,
     LGD3, 34% from B3, LGD3, 33%

  -- Corporate Family rating -- to Caa2 from B3
  -- Probability of Default rating -- to Caa3 from Caa1

The outlook remains negative.

The downgrade of the CFR incorporates Moody's view that Journal
Register faces a heightened probability of default following the
release of 1Q08 financial results which reported further top line
deterioration (down 10%), free cash flow losses and management's
disclosure that the company will probably default under its
recently amended (twice) financial covenants as of July 23, 2008.  
Because Journal Register now reports the entire $640 million
balance of its senior secured debt as a current liability, the
company's current liabilities substantially exceed its current
assets, effectively representing an insolvent credit profile.

The continuing negative outlook reflects Moody's concern that
Journal Register will likely default under the terms of its senior
secured loan covenants during 2008 (absent an amendment) and
Moody's view that even if the company receives further covenant
relief, it is not likely to generate sufficient free cash flow to
cover its scheduled 2009 debt repayment obligations (absent a
recapitalization).  Ratings may need to be lowered further if the
company's business operations and liquidity profile continue to
deteriorate and/or an actual payment default and subsequent
restructuring transpires.  Moody's notes that debtholders are
currently protected with only a deminimus equity cushion (based
upon the company's current market value of around $10 million) and
that a sale or liquidation of the company would likely result in
less than full (albeit still above-average, per Moody's estimates)
recovery for secured lenders.

The Caa2 CFR reflects Journal Register's heavy debt burden, its
high financial leverage, the cyclical pressure which continues to
depress the company's advertising revenues (especially in
Michigan) and the competition posed by print and electronic media
in virtually all of Journal Register's markets.  Ratings are
supported by the company's positive LTM free cash flow generation,
the efficiencies provided by its clustering strategy, and by its
geographic diversification.

Journal Register Company is a leading US newspaper publishing
company.  Based in Yardley Pennsylvania, the company recorded
sales of $451 million for the LTM period ended March 31, 2008.


JOHN HOWARD: Case Summary & Seven Known Creditors
-------------------------------------------------
Debtor: John Howard Pontiac-Buick-GMC, Inc.
        185 Wade Street
        Waynesburg, PA 15370

Bankruptcy Case No.: 08-22223

Debtor affiliates filing separate chapter 11 petitions:

      Entity                                     Case No.
      ------                                     --------
      John W. Howard                             08-22224

Type of Business: John Howard Pontiac-Buick-GMC, Inc., is a dealer
                  of new and used cars.  John W. Howard is the
                  president of John Howard Pontiac-Buick-GMC, Inc.

                  John Howard Chrysler Jeep Dodge, Inc., an
                  affiliate of the debtors, filed for chapter 11
                  protection on Feb. 7, 2008 (Bankr. W.D. Pa.
                  Case No. 08-20777).

Chapter 11 Petition Date: April 4, 2008

Court: Western District of Pennsylvania (Pittsburgh)

Judge: Jeffery A. Deller

Debtors' Counsel: Robert O Lampl, Esq.
                  960 Penn Avenue, Suite 1200
                  Pittsburgh, PA 15222
                  Tel: (412) 392-0330
                  Fax: (412) 392-0335

                          Estimated Assets   Estimated Debts
                          ----------------   ---------------
John Howard               $1 million to      $1 million to
Pontiac-Buick-GMC, Inc.   $10 million        $10 million

John W. Howard            $1 million to      $1 million to
                          $10 million        $10 million

A. John Howard Pontiac-Buick-GMC, Inc.'s Three Known Creditors:

   Entity                                    Claim Amount
   ------                                    ------------
Community Bank                                    Unknown
P.O. Box 357
Carmichaels, PA 15320

John W. Howard                                    Unknown
142 Stewart Street
Waynesburg, PA 15370

United Bank                                       Unknown
P.O. Box 2373
Charleston, WV 25326

B. John W. Howard's Four Known Creditors:

   Entity                                    Claim Amount
   ------                                    ------------
Community Bank                                    Unknown
P.O. Box 357
Carmichaels, PA 15320

Countrywide Financial                             Unknown
P.O. Box 660625
Dallas, TX 75266

GMAC                                              Unknown
P.O. Box 9001719
Louisville, KY 40290

United Bank                                       Unknown
P.O. Box 2373
Charleston, WV 25326


JOHN DALY: Case Summary & Eight Known Creditors
-----------------------------------------------
Debtors: John J. Daly and Carmencita Yanga Daly
         1113 Morella Park Drive
         Martinez, CA 94553

Bankruptcy Case No.: 08-41639

Chapter 11 Petition Date: April 6, 2008

Court: Northern District of California (Oakland)

Judge: Edward D. Jellen

Debtors' Counsel: Duane L. Tucker, Esq.
                  Law Offices of Duane L. Tucker
                  27793 Tampa Avenue
                  Hayward, CA 94544
                  Tel: (510) 670-0668

Estimated Assets: $1 million to $10 million

Estimated Debts:  $1 million to $10 million

Debtor's Eight Known Creditors:

   Entity                                      Claim Amount
   ------                                      ------------
California Employment Development Department        Unknown
Bankruptcy Group MIC 92E
P.O. Box 826880
Sacramento, CA 94280-0001

California Franchise Tax Board                      Unknown
Special Procedures Bankruptcy Unit
P.O. Box 2952
Sacramento, CA 95812-2952

EMC Mortgage Corporation                            Unknown
Attn: Bankruptcy Department
P.O. Box 293150
Lewisville, TX 75029-3150

Labor Commissioner                                  Unknown
1515 Clay St., Room 801
Oakland, CA 94612-1463

Mortgage Electronic Registration System             Unknown
Attn: Bankruptcy Department
P.O. Box 293150
Lewisville, TX 75029-3150

State Board of Equalization                         Unknown
Collection Department
P.O. Box 942879
Sacramento, CA 94279-0001

Washington Mutual Bank                              Unknown
Moss Codilis, LLP
Mail Stop: JAXA2035
7255 Baymeadows Way
Jacksonville, FL 32256-6851

Wells Fargo Bank                                    Unknown
P.O. Box 10438
Des Moines IA 50306-0438


KENTUCKY DATA: Moody's Holds B1 CF Rating; Changes Outlook to Pos.
------------------------------------------------------------------
Moody's Investors Service has affirmed the ratings on Kentucky
Data Link, and changed the outlook to positive from stable, based
on the Company's strong operating performance, coupled with
expectations of de-leveraging and continued free cash flow growth
over the forward rating horizon.  Moody's has taken these ratings
actions:

Issuer: Kentucky Data Link, Inc.

  -- Outlook, Changed To Positive From Stable
  -- Corporate family rating -- Affirmed B1
  -- Probability of default rating -- Affirmed B2
  -- US$240M Senior Secured Bank Credit Facility Due 2014,
     Affirmed B1 LGD3 (34%)

  -- US$40M Senior Secured Bank Credit Facility Due 2012, Affirmed
     B1 LGD3 (34%)

The company's credit facilities were put in place to fund the
purchase of Norlight Telecommunications from Journal
Communications and refinance KDL's existing debt in February 2007.  
The positive outlook reflects KDL's performance over the past
year, as it has exceeded Moody's revenue and expense expectations
and has been successful in achieving synergies from the Norlight
acquisition.  

Although KDL spent more than Moody's expected on network
expansion, including acquiring some of McLeod's fiber properties
in the Midwest and building new fiber runs to support access
points for a wireless operator in the Chicago area, Moody's
believes that this forward capex spending will position the
Company to generate healthy free cash flow and continue its
deleveraging program.

The B1 corporate family rating reflects KDL's small size, modest
historical free cash flow, high pro forma leverage, greater
likelihood of increased competition as the company grows, and the
ongoing integration of Norlight within its operations.  The
ratings are supported by KDL's track record of profitability,
which is largely attributed to the company's strong position as
the only alternative to the incumbent ILEC in the 2nd and 3rd tier
markets in the Midwest and the Southeast US.

KDL is a wholesale transport service provider in the Midwest and
the Southeast US.  The company's headquarters are located in
Evansville, Indiana.


LANDING DEVELOPMENT: Section 341(a) Meeting Set for May 20
----------------------------------------------------------
The U.S. Trustee for Region 18 will convene a meeting of creditors
of Landing Development LLC at 1:30 p.m., on May 20, 2008, at UST1,
U.S. Trustee's Office, Room 223 in Portland, Oregon.

This is the first meeting of creditors required under Section
341(a) of the Bankruptcy Code in all bankruptcy cases.

All creditors are invited, but not required, to attend.  This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible office of the
Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.

Milwaukie, Oregon-based Landing Development LLC, aka Volare at
Eagle Landings and aka Marnella Homes, --
http://www.marnellahomes.com/-- is a home builder.  The company,  
together with Tony Marnella Inc. and Anthony Lawrence Marnella,
filed chapter 11 petition on April 14, 2008 (Bankr. D. Ore. Case
Nos. 08-31686, 08-31685 and 08-31688).  Judge Elizabeth L. Perris
presides the case.  Susan S. Ford, Esq., at Sussman Shank LLP
represents the Debtors in their restructuring efforts.  They
listed $10 to $50 million in assets and debts when they filed for
bankruptcy.


LEHMAN ABS: S&P Chips 'BB+' Rating on Class M-1 Certs. to 'B-'
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on eight
classes of senior/subordinate asset-backed certificates from
Lehman ABS Manufactured Housing Contract Trust 2001-B.  The long-
term rating on class A-7 from this transaction was not affected by
these actions because it benefits from an insurance policy issued
by Ambac Assurance Corp.
     
The lowered ratings reflect the deterioration in credit
enhancement resulting from the worse-than-expected performance
trends displayed by the underlying pool of manufactured housing
contracts, which were originated by CIT Group/Sales Financing Inc.
Effective April 1, 2008, Green Tree Servicing LLC is the servicer
on this transaction.
     
As of the April 2008 payment date, this transaction had a pool
factor of 40.33%, and the trust had experienced cumulative net
losses of 14.5% after 78 months of performance.  In addition, 8.4%
of the current pool balance is more than 60 days past due, and
more than 13% of the current pool balance is more than 30 days
past due.  Moreover, the high level of monthly losses and
insufficient excess spread have caused complete principal write-
downs on the class B-2 certificate, and the class B-1 certificate
has been written down to almost half of its original outstanding
principal balance.
     
Standard & Poor's will continue to monitor this transaction to
determine whether further rating actions are warranted.
   

                         Ratings Lowered
    
       Lehman ABS Manufactured Housing Contract Trust 2001-B
   
                                  Rating
                                  ------
                    Class   To              From
                    -----   --              ----
                    A-1     BBB+            A+
                    A-2     BBB+            A+
                    A-3     BBB+            A+
                    A-4     BBB+            A+
                    A-5     BBB+            A+
                    A-6     BBB+            A+
                    M-1     B-              BB+
                    M-2     CCC-            CCC+


LEHMAN BROTHERS TRUST: Moody's Affirms Caa1 Rating on Certificates
------------------------------------------------------------------
Moody's Investors Service upgraded the ratings of four classes and
affirmed the ratings of four classes of Lehman Brothers Floating
Rate Commercial Mortgage Trust 2006-CCL C2, Commercial Mortgage
Pass-Through Certificates, Series 2006-CCL C2 as:

  -- Class X, Notional, affirmed at Aaa
  -- Class X-FLP, Notional, affirmed at Aaa
  -- Class J, $3,241,096, Floating, upgraded to Aaa from A1
  -- Class K, $20,030,000, Floating, upgraded to A3 from Baa3
  -- Class L, $18,920,000, Floating, affirmed at Ba3
  -- Class M, $26,776,000, Floating, affirmed at Caa1
  -- Class GRS $585,489, Floating, upgraded to A1 from Baa1
  -- Class MTH, $25,925, Floating, upgraded to A1 from A3

Moody's is upgrading pooled classes J and K due to increased
credit support from partial property releases.  Moody's is
upgrading non-pooled rake classes GRS and MTH due to decreased
loan leverage from condominium unit releases from the 88 Greenwich
Street and Mandalay on the Hudson Loans, respectively.

The Certificates are collateralized by six senior participation
interests in seven properties.  The loans range in size from 1.0%
to 24.0% of the pool based on current principal balances.  As of
the April 15, 2008 distribution date, the transaction's aggregate
certificate balance had decreased by approximately 92.3% to
$71.8 million from $932.9 million at securitization as the result
of the payoff of ten loans initially in the pool and partial
property releases associated with the remaining six loans.

The trust contains transitional assets that are undergoing
conversion for sale as residential condominiums.  Classes J, K, L
and M are pooled classes. Classes GRS and MTH are non-pooled
classes that depend on the performance of the 88 Greenwich Street
Loan and the Mandalay on the Hudson Loan, respectively.

The 88 Greenwich Street Loan (18.1%) is secured by 457 residential
units and 51,383 square feet of retail space.  The building was
originally constructed as an office building and was converted to
a rental apartment building in 2002.  It is located in New York
City's Financial District.  The conversion is proceeding in line
with the initial business plan.  Units began to close in July,
2007.  To date, 250 units have closed (54.7%) and there are an
additional 29 units (6.3%) under contract.  The average sales
price for these 279 units is $798,820 per unit (approximately
$1,140 per square foot).


LEVITT AND SONS: Administrator Taps Whelchel & Dunlap as Counsel
----------------------------------------------------------------
Soneet R. Kapila, as chief administrator for certain debtors-
affiliates of Levitt and Sons LLC that are borrowers under a DIP
Loan Agreement with Wachovia Bank N.A., seek authority from the
U.S. Bankruptcy Court for the Southern District of Florida to
retain the law firm Whelchel, Dunlap, Jarrard & Walker, LLP, as
its special counsel, nunc pro tunc to April 19, 2008.

Mr. Kapila wants to hire Whelchel & Dunlap to assist him in
carrying out his duties, including representing him in connection
with zoning and local government issues.

Whelchel & Dunlap has agreed to be compensated from funds
advanced under the DIP Loan Agreement upon filing fee
applications in accordance with Section 330 of the Bankruptcy
Code and the local rules of the Court.  The firm's hourly rate is
$240.

Whelchel & Dunlap has requested that Mr. Kapila deposit a $3,000
retainer to apply against future statements, Cynthia C. Jackson,
Esq., at Smith Hulsey & Busey, in Jacksonville, Florida, informs
the Court.

William A. Bagwell, a member of Whelchel & Dunlap, assures the
Court that his firm and its individual members do not hold or
represent any interest adverse to the Debtors, their creditors or
estates.

Mr. Bagwell discloses that the firm represents Bob Vass and Sally
Porter in the Debtors' Chapter 11 cases.  Mr. Vass and Ms. Porter
entered into residential purchase agreements with the Wachovia
Debtors prepetition.  The agreements have been rejected by the
Wachovia Debtors and Mr. Vass and Ms. Porter have filed proofs of
claim in the Debtors' bankruptcy cases.

Whelchel is a "disinterested person," as the term is defined in
Section 101(14) of the Bankruptcy Code, Mr. Bagwell asserts.

                      About Levitt and Sons

Based in Fort Lauderdale, Florida, Levitt and Sons LLC --
http://www.levittandsons.com/-- is the homebuilding subsidiary of
Levitt Corporation (NYSE:LEV).  Levitt Corp. --
http://www.levittcorporation.com/-- together with its
subsidiaries, operates as a homebuilding and real estate
development company in the southeastern United States.  The
company operates in two divisions, homebuilding and land.  The
homebuilding division primarily develops single and multi-family
homes for adults and families in Florida, Georgia, Tennessee, and
South Carolina.  The land division engages in the development of
master-planned communities in Florida and South Carolina.

Levitt and Sons LLC and 38 of its homebuilding affiliates filed
for Chapter 11 protection on Nov. 9, 2007 (Bankr. S.D. Fla. Lead
Case No. 07-19845).  Paul Singerman, Esq. and Jordi Guso, Esq., at
Berger Singerman, P.A., represent the Debtors in their
restructuring efforts.  The Debtors chose AP Services, LLC as
their crisis managers, and Kurtzman Carson Consultants, LLC as
their claims and noticing agent.  Levitt Corp., the parent
company, is not included in the bankruptcy filing.

The Debtors' latest consolidated financial condition as of
Sept. 30, 2007 reflect total assets of $900,392,000, and total
liabilities of $780,969,000.  (Levitt and Sons Bankruptcy News,
Issue No. 20; Bankruptcy Creditors' Service Inc.;
http://bankrupt.com/newsstand/or 215/945-7000)


LEVITT AND SONS: Administrator Wants to Employ VHB as Consultant
----------------------------------------------------------------
Soneet R. Kapila, as chief administrator for certain debtors-
affiliates of Levitt and Sons LLC that are borrowers under a DIP
Loan Agreement with Wachovia Bank N.A., seek authority from the
U.S. Bankruptcy Court for the Southern District of Florida to
retain Vanasse Hangen Brustlin, Inc., as an engineering consultant
in the Debtors' Chapter 11 cases, nunc pro tunc to April 8, 2008.

Mr. Kapila seeks to hire VHB to assist him in carrying out his
duties with respect to two of the Wachovia Debtors' residential
communities, Cascades at Sarasota and Rio Mar Sarasota, both
located in Manatee County, Florida.

In connection with the development of Rio Mar Sarasota and
Cascades at Sarasota, the Wachovia Debtors were required by local
governmental authorities to post bonds to provide funding to the
local government in the event they failed to complete or correct
defects in sidewalk, roadway and other improvements, Cynthia C.
Jackson, Esq., at Smith Hulsey & Busey, in Jacksonville, Florida,
relates.

Since the date of bankruptcy, the Wachovia Debtors have been
informed by local government authorities that they were
considering calling the bonds.  VHB served as Project Engineer
regarding the Project Bonds, Ms. Jackson informs the Court.

VHB has been chosen as an engineering consultant because of the
experience of the firm's personnel with the Projects, according
to Ms. Jackson.

VHB will be paid according to its hourly fees and expenses
advanced from funds under the DIP Loan Agreement, in accordance
with the Court's November 14, 2007 Interim Compensation and
Reimbursement Order and local rules of the Court.

The firm estimates that the total cost of its contemplated
services as an engineering consultant will not exceed $20,500.

Steve J. Shroyer, a Florida licensed professional engineer and
senior project manager at VHB, assures the Court that neither he
nor any other employee of his firm has any connection with any
creditors or any other parties-in-interest or their attorneys or
accountants in the Debtors' Chapter 11 cases.

VHB and its individual employees do not hold or represent any
interest adverse to the Debtors, their creditors or estates, Mr.
Shroyer asserts.  The firm and its employees are each a
disinterested person, as the term is defined in Section 101(14)
of the Bankruptcy Code, he attests.

                      About Levitt and Sons

Based in Fort Lauderdale, Florida, Levitt and Sons LLC --
http://www.levittandsons.com/-- is the homebuilding subsidiary of
Levitt Corporation (NYSE:LEV).  Levitt Corp. --
http://www.levittcorporation.com/-- together with its
subsidiaries, operates as a homebuilding and real estate
development company in the southeastern United States.  The
company operates in two divisions, homebuilding and land.  The
homebuilding division primarily develops single and multi-family
homes for adults and families in Florida, Georgia, Tennessee, and
South Carolina.  The land division engages in the development of
master-planned communities in Florida and South Carolina.

Levitt and Sons LLC and 38 of its homebuilding affiliates filed
for Chapter 11 protection on Nov. 9, 2007 (Bankr. S.D. Fla. Lead
Case No. 07-19845).  Paul Singerman, Esq. and Jordi Guso, Esq., at
Berger Singerman, P.A., represent the Debtors in their
restructuring efforts.  The Debtors chose AP Services, LLC as
their crisis managers, and Kurtzman Carson Consultants, LLC as
their claims and noticing agent.  Levitt Corp., the parent
company, is not included in the bankruptcy filing.

The Debtors' latest consolidated financial condition as of
Sept. 30, 2007 reflect total assets of $900,392,000, and total
liabilities of $780,969,000.  (Levitt and Sons Bankruptcy News,
Issue No. 20; Bankruptcy Creditors' Service Inc.;
http://bankrupt.com/newsstand/or 215/945-7000)


LINENS N THINGS: Reports 2008 First Quarter Sales Results
---------------------------------------------------------
Linens Holding Co., reported its sales results for the first
quarter ended March 29, 2008.  The Company reported total net
sales of $566.9 million for the quarter, a 0.8% decrease over the
same period in 2007.  This decrease in net sales resulted from a
comparable store sales decline of 5.7% for the quarter, partially
offset by the opening of new stores.

Due to its recent Chapter 11 bankruptcy filing, the Company
requires additional time to complete the preparation of its
consolidated financial statements for the first quarter of 2008.  
The delay is necessary in part because, in connection with the
Company's bankruptcy filing, the Company is performing an
impairment analysis related to certain of its tangible and
intangible assets, which is not yet complete.  As a result, the
Company has not finalized its quarterly financial statements on
its customary schedule and will not file its Form 10-Q with the
Securities and Exchange Commission today.  The Company intends to
finalize the financial statements and file the report as soon as
reasonably practicable.  In addition, due to these factors, the
Company will not hold a first quarter 2008 investor earnings
conference call.

The Company ended the quarter with an asset-based revolver balance
of $349.1 million (excluding outstanding letters of credit
totaling $61.8 million), cash on hand of $8.3 million and excess
availability under its revolving credit facility of $116.1
million.  The Company disclosed in its recent Chapter 11
bankruptcy filing that an aggregate amount of $369.3 million was
outstanding under the revolver as of the date of the filing, May
2, 2008.  This balance excludes outstanding letters of credit
totaling $61.1 million.  At the same time, the Company had total
liquidity of $95.3 million, consisting of excess availability
under its revolving credit facility of $77.9 million and
available cash of $17.4 million.  As of the close of business on
May 11, 2008, the Company had total liquidity in excess of $100
million.

During the first quarter of 2008, the Company opened seven stores
and closed three stores as compared with opening two stores and
closing zero stores during the first quarter of 2007.  Store
square footage increased 2.9% to 19.5 million at March 29,
2008 compared with 19.0 million at March 31, 2007.

Linens 'n Things, with 2007 sales of approximately $2.8 billion,
is one of the leading, national large format retailers of home
textiles, housewares and home accessories.  As of March 29, 2008,
Linens 'n Things operated 593 stores in 47 states and seven
provinces across the United States and Canada.  More information
about Linens 'n Things can be found online at http://www.lnt.com/

                 Linens 'N Things Delays Filing
                  1st Quarter Results with SEC

Linens Holding Co., Linens 'n Things, Inc., and Linens 'n Things
Center, Inc., informed the Securities and Exchange Commission they
are "not in a position" where they will be able to file their
Quarterly Report on Form 10-Q for the 13-week period ended
March 29, 2008, in a timely manner.

The Linens 'n Things Entities pointed to their Chapter 11 filing
as the principal reason for the delay.  The cited that, as a
result of their bankruptcy filing, they are performing an
impairment analysis related to certain of their tangible and
intangible assets, which analysis is not yet complete.

Francis M. Rowan, senior vice president and chief financial
officer, said Linens 'n Things requires additional time to
complete its consolidated financial statements and management's
discussion and analysis of financial condition and results of
operations.

According to Mr. Rowan, the company intends to file the Report as
soon as reasonably practicable.

                     About Linens 'N Things

Clifton, New Jersey-based Linens Holding Co., which does business
through its operating subsidiary Linens 'N Things Inc. --
http://www.lnt.com/-- is the second largest specialty retailer of       
home textiles, housewares and home accessories in North America
operating 589 stores in 47 U.S. states and seven Canadian
provinces as of December 29, 2007.  The company is a destination
retailer, offering one of the broadest and deepest selections of
high quality brand-name well as private label home furnishings
merchandise in the industry.

Linens 'N Things and 11 affiliates filed separate voluntary
petitions under Chapter 11 of the United States Bankruptcy Code in
the United States Bankruptcy Court for the District of Delaware on
May 2, 2008 (Lead Case No. 08-10832).  The Canadian operations are
not included in the filings.

Linens 'N Things has secured a $700 million debtor-in-possession
financing from General Electric Capital Corp.  The company plans
to be out of chapter 11 by the end of the year, on this timetable:

    09/14/2008 DIP Facility Deadline for Filing a Chapter 11 Plan

    10/14/2008 DIP Facility Deadline for Disclosure Statement
               Approval

    11/18/2008 DIP Facility Deadline for Soliciting Votes on Plan

    11/28/2008 DIP Facility Deadline for Entry of a Confirmation
               Order

Linens 'N Things is represented by Richards, Layton & Finger,
P.A., and Morgan, Lewis & Bockius LLP.  Conway, Del Genio, Gries &
Co., LLC will serve as the retailer's restructuring advisor until
substantial consummation of a chapter 11 plan.  Conway Del Genio's
Michael F. Gries acts as the Debtors' chief restructuring officer
and interim CEO.  Kurtzman Carson Consultants LLC acts as the
Debtors' claims agent.

A Noteholder Committee has been formed and is represented by
Kasowitz, Benson, Torres & Friedman LLP, and Pachulski Stang Ziehl
& Jones.

(Linens 'n Things Bankruptcy News, Issue No. 5, Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or      
215/945-7000)7


LINENS N THINGS: Wants to Employ Richards Layton as Counsel
-----------------------------------------------------------
Linens 'n Things and its debtor-affiliates seek the authority of
the United States Bankruptcy Court for the District of Delaware to
employ Richards, Layton & Finger, P.A., as counsel, nunc pro tunc
to their bankruptcy filing date.

Francis M. Rowan, the Debtors' senior vice president and chief
financial officer, says that Richards Layton has extensive
experience and knowledge in business reorganizations and
liquidations.  The Debtors believe that Richards Layton is well
qualified to represent them in a most efficient and timely
manner.

As counsel, Richards Layton will:

   (a) advise the Debtors of their rights, powers and duties
       as debtors and debtors-in-possession;

   (b) protect and preserve the Debtors' bankruptcy estates, by
       prosecuting actions on their behalf, and negotiating
       disputes, in which the Debtors are involved;

   (c) prepare all necessary motions, applications, and reports
       in connection with the administration of the estates; and

   (d) perform all other necessary legal services in connection
       with the cankruptcy cases.

Richards Layton will be paid in its standard hourly rates:

              Mark D. Collins         $560
              John H. Knight          $490
              Michael J. Merchant     $420
              Jason M. Madron         $305
              Christopher M. Sarnis   $235
              L. Katherine Good       $235
              Aja McDowell            $175

The Debtors will also reimburse Richards Layton with its
reasonable out-of-pocket expenses.

Richards Layton has rendered legal services to the Debtors prior
to the Petition Date in connection with the preparation of, and
commencement of the Chapter 11 cases.  The firm received a total
retainer of $350,000 for prepetition services and related
expenses.  A portion of the payment has been applied to
outstanding balances existing as of the Petition Date.

The Debtors propose that the retainer paid to Richards Layton
that was not expended for prepetition services and disbursements,
be treated as an evergreen retainer paid in contemplation of
services to be rendered pursuant to this application.  The
Debtors also propose that the amounts be held by the firm as
security throughout the bankruptcy cases until its fees and
expenses are awarded by final order, and are then payable.

Mark D. Collins, Esq., a director at Richards Layton, assures the
Court that the firm is a "disinterested person" as that term is
defined in Section 101(14) of the Bankruptcy Code.

                     About Linens 'N Things

Clifton, New Jersey-based Linens Holding Co., which does business
through its operating subsidiary Linens 'N Things Inc. --
http://www.lnt.com/-- is the second largest specialty retailer of       
home textiles, housewares and home accessories in North America
operating 589 stores in 47 U.S. states and seven Canadian
provinces as of December 29, 2007.  The company is a destination
retailer, offering one of the broadest and deepest selections of
high quality brand-name well as private label home furnishings
merchandise in the industry.

Linens 'N Things and 11 affiliates filed separate voluntary
petitions under Chapter 11 of the United States Bankruptcy Code in
the United States Bankruptcy Court for the District of Delaware on
May 2, 2008 (Lead Case No. 08-10832).  The Canadian operations are
not included in the filings.

Linens 'N Things has secured a $700 million debtor-in-possession
financing from General Electric Capital Corp.  The company plans
to be out of chapter 11 by the end of the year, on this timetable:

    09/14/2008 DIP Facility Deadline for Filing a Chapter 11 Plan

    10/14/2008 DIP Facility Deadline for Disclosure Statement
               Approval

    11/18/2008 DIP Facility Deadline for Soliciting Votes on Plan

    11/28/2008 DIP Facility Deadline for Entry of a Confirmation
               Order

Linens 'N Things is represented by Richards, Layton & Finger,
P.A., and Morgan, Lewis & Bockius LLP.  Conway, Del Genio, Gries &
Co., LLC will serve as the retailer's restructuring advisor until
substantial consummation of a chapter 11 plan.  Conway Del Genio's
Michael F. Gries acts as the Debtors' chief restructuring officer
and interim CEO.  Kurtzman Carson Consultants LLC acts as the
Debtors' claims agent.

A Noteholder Committee has been formed and is represented by
Kasowitz, Benson, Torres & Friedman LLP, and Pachulski Stang Ziehl
& Jones.

(Linens 'n Things Bankruptcy News, Issue No. 4, Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or      
215/945-7000)


LINEN N THINGS: Wants to Employ Gardere as Special Counsel
----------------------------------------------------------
Linens 'n Things and its debtor-affiliates seek the authority of
the United States Bankruptcy Court for the District of Delaware to
employ Gardere Wynne Sewell LLP as their special counsel in their
Chapter 11 Cases, nunc pro tunc to their bankruptcy filing date.

Gardere Wynne has represented the Debtors before the Petition
Date in connection with numerous areas and legal issues,
including the Debtors' prepetition efforts to avoid a Chapter 11
filing, preparation for the commencement of their Bankruptcy
Cases.

Gardere will work closely with the Debtors' proposed counsel,
Richards, Layton & Finger, P.A., to ensure that the tasks
discretely related to the bankruptcy process are appropriately
handled by Richards Layton.  Morgan, Lewis & Bockius LLP has also
been engaged as special counsel in connection with financing
matters, real estate matters and matters pertaining to the
Debtors' Canadian subsidiaries.

The Debtors say they require various counsel so that they will be
able to effect their reorganization proceedings with optimal
efficiency because their Bankruptcy Cases are complex and
involves a multi-level debt structure and almost 600 retail
stores throughout the United States of America and Canada.

Gardere has represented the Debtors prepetition in connection
with these areas and issues:

     (i) general corporate;

    (ii) securities matters, including SEC filings;

   (iii) real estate;

    (iv) tax;

     (v) intellectual property;

    (vi) labor, employment and employment benefits;

   (vii) general litigation;

  (viii) regulatory issues;

    (ix) licensing, insurance, transportation and vendor issues;

     (x) negotiation of credit agreements;

    (xi) statutory compliance counseling;

   (xii) resolution of issues related to the Debtors' lease
         portfolio and Canadian subsidiaries; and

  (xiii) various other matters applicable to the Canadian
         subsidiaries.

Gardere will continue to provide legal advice to the Debtors
during the course of their Chapter 11 cases.

The Debtors will compensate Gardere in accordance with the firm's
customary hourly rates:

         Professional              Hourly Rate
         ------------              -----------
         Partners                 $390 to $750
         Associates               $210 to $450
         Paraprofessionals         $90 to $210

The Debtors will also reimburse Gardere for all reasonable out-
of-pocket expenses incurred relating directly to work performed
for the Debtors.

Francis M. Rowan, senior vice president and chief financial
officer of the Debtors, discloses that the Debtors paid Gardere
$625,000, as a retainer fee before the Petition Date.  The
Debtors paid Gardere $3,797,752 in the 12-month period ended
April 30, 2008, for legal services rendered to the Debtors during
the period.  As of the Petition Date, the Debtors do not owe
Gardere for legal services rendered or expenses provided before
the Petition Date.

                     Gardere Not Disinterested

Ronald M. Gaswirth, a partner at Gardere, assures the Court that
the firm does not represent any interest materially adverse to
the Debtors, their creditors and the United States Trustee or any
other party in interest.  

Section 327(a) of the Bankruptcy Code provides that the debtor
may employ attorneys and other professionals, provided that they
do not hold an interest adverse to the estate, and they are
disinterested persons.  

According to Mr. Rowan, Gardere has served as the Debtors'
outside general counsel for over two years.  The Linens Companies
do not have an integral legal department and, accordingly,
Gardere lawyers have become intimately familiar with the
operations of the Debtors and have been involved in the
negotiation and implementation of a myriad of contracts and other
business functions throughout the Debtors' organization.  The
Linens Companies have invested millions of dollars in the
services Gardere has provided, and Gardere has established a
significant knowledge base regarding the Linens Companies, which
can neither practically no economically be transferred to
alternative counsel at a time when the Linens Companies most
require knowledgeable advice and counseling.  

The Debtors admit that Gardere, however, is precluded from
applying for employment under Section 327(a) due to the sole fact
that one of its partners, Ron Gaswirth, served in the very
ministerial role of secretary to the Debtors prior to the
bankruptcy filing.  Mr. Gaswirth was at all times a full partner
at Gardere during his tenure as Secretary, received no salary or
other compensation as Secretary, yet took notes at quarterly
meetings of the Debtors' Board of Directors in furtherance of
Gardere's responsibilities as counsel to the Linens Companies.  
Unfortunately Mr. Gaswirth cannot technically qualify under the
disinterestedness test.  Despite the lack of statutory mandate,
apparently Mr. Gaswirth's lack of disinterestedness is deemed
impugned to the entire firm of Gardere, the Debtors relate.

Accordingly, the Debtors say they are compelled to apply to the
Court for the employment of Gardere under Section 327(e) of the
Bankruptcy Code.  

Section 327(e) provides the debtor may employ for a specified
special purpose, other than to represent it in conducting the
case, an attorney that has represented the debtor, if in the best
interest of the estate, and if the attorney does not represent or
hold any interest adverse to the debtor or the estate with
respect to the matter on which the attorney is to be employed.

Mr. Rowan acknowledges that normally, general bankruptcy counsel
employed under Section 327(a) would merely call upon special
counsel with particular areas of expertise for assistance and
information about these legal areas of the law when necessary.  
Due to the extensive knowledge of Gardere, the Debtors request
that bankruptcy attorneys at Gardere continue to interact with
attorneys in the appropriate specialty areas of practice at
Gardere to assist Richards Layton in "obtaining" the appropriate
legal information and thereby more efficiently handing a project
and assisting Richards Layton as Section 327(a) bankruptcy
counsel.

                     About Linens 'N Things

Clifton, New Jersey-based Linens Holding Co., which does business
through its operating subsidiary Linens 'N Things Inc. --
http://www.lnt.com/-- is the second largest specialty retailer of       
home textiles, housewares and home accessories in North America
operating 589 stores in 47 U.S. states and seven Canadian
provinces as of December 29, 2007.  The company is a destination
retailer, offering one of the broadest and deepest selections of
high quality brand-name well as private label home furnishings
merchandise in the industry.

Linens 'N Things and 11 affiliates filed separate voluntary
petitions under Chapter 11 of the United States Bankruptcy Code in
the United States Bankruptcy Court for the District of Delaware on
May 2, 2008 (Lead Case No. 08-10832).  The Canadian operations are
not included in the filings.

Linens 'N Things has secured a $700 million debtor-in-possession
financing from General Electric Capital Corp.  The company plans
to be out of chapter 11 by the end of the year, on this timetable:

    09/14/2008 DIP Facility Deadline for Filing a Chapter 11 Plan

    10/14/2008 DIP Facility Deadline for Disclosure Statement
               Approval

    11/18/2008 DIP Facility Deadline for Soliciting Votes on Plan

    11/28/2008 DIP Facility Deadline for Entry of a Confirmation
               Order

Linens 'N Things is represented by Richards, Layton & Finger,
P.A., and Morgan, Lewis & Bockius LLP.  Conway, Del Genio, Gries &
Co., LLC will serve as the retailer's restructuring advisor until
substantial consummation of a chapter 11 plan.  Conway Del Genio's
Michael F. Gries acts as the Debtors' chief restructuring officer
and interim CEO.  Kurtzman Carson Consultants LLC acts as the
Debtors' claims agent.

A Noteholder Committee has been formed and is represented by
Kasowitz, Benson, Torres & Friedman LLP, and Pachulski Stang Ziehl
& Jones.

(Linens 'n Things Bankruptcy News, Issue No. 5, Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or      
215/945-7000)7


MCKINNEY ZONE: Voluntary Chapter 11 Case Summary
------------------------------------------------
Debtor: McKinney Zone, LP
        448 North Custer Rd.
        McKinney, TX 75071

Bankruptcy Case No.: 08-41186

Chapter 11 Petition Date: May 5, 2008

Court: Eastern District of Texas (Sherman)

Debtor's Counsel: Robert T. DeMarco, Esq.
                  Email: bob@bankruptcytx.com
                  Boyd Veigel, P.C.
                  218 E. Lousiana, P.O. Box 1179
                  McKinney, TX 75070
                  Tel: (972) 562-9700
                  Fax: (972) 208-4603

Estimated Assets: $1 million to $10 million

Estimated Debts:  $1 million to $10 million

The Debtor did not file a list of its largest unsecured creditors.


MERGE HEALTHCARE: Posts $7.8 Million Net Loss in 2008 1st Quarter
-----------------------------------------------------------------
Merge Healthcare Incorporated reported on Monday financial results
for the first quarter ended March 31, 2008.

The net loss for the first quarter of 2008 totaled $7.8 million,
compared to a net loss of $9.7 million in the first quarter of
2007 and a net loss of $9.6 million in the fourth quarter of 2007.
The net loss in the fourth quarter of 2007 also includes a
$1.2 million charge for the write-down to the estimated fair
market value of an investment in the equity of a privately held
customer of Cedara Software.

For the first quarter ended March 31, 2008, revenue totaled
$13.7 million, compared to $15.9 million in the first quarter
ended March 31, 2007 and $15.6 million in the fourth quarter ended
Dec. 31, 2007.

Operating loss for the first quarter ended March 31, 2008, was
$8.4 million, compared to an operating loss of $10.2 million in
the first quarter ended March 31, 2007, and $8.5 million in the
fourth quarter ended Dec. 31, 2007.

Contributing to the operating loss for the first quarter of 2008
was a charge of $1.4 million for costs, primarily severance costs,
incurred in connection with the reduction in force that was
announced and implemented on Feb. 14, 2008, and $300,000 in
additional severance costs for the former president of the
company's EMEA business unit, partially offset by $1.1 million in
reimbursement from the company's primary insurance carrier for
legal fees incurred in connection with Merge's class action
litigation.

Contributing to the operating loss for the first quarter of 2007
was a restructuring charge of $800,000 in connection with the
rightsizing initiative announced in November of 2006.  

The adjusted operating loss for the first quarter of 2008 was
$4.0 million compared to adjusted operating losses of $4.2 million
in the first quarter of 2007 and the fourth quarter of 2007.

The non-GAAP adjusted operating income (loss) excludes the impact
of stock option expense under SFAS 123(R), depreciation and
amortization expense, non-recurring legal and accounting costs,
various lawsuits and the pursuit of strategic options, reduction
in force and duplication of effort costs.

                     Going Concern Disclaimer

As reported in the Troubled Company Reporter on April 29, 2008,
KPMG LLP in Chicago expressed substantial doubt about Merge
Healthcare Incorporated's ability to continue as a going concern
after auditing the company's consolidated financial statements for
the year ended Dec. 31, 2007.  The auditing firm pointed to the
company's recurring losses from operations and negative cash
flows.

The company says it has generated losses from operations over the
past nine consecutive quarters and the company currently has no
credit facility.  As a result, the company is currently completely
dependent on available cash and operating cash flow to meet its
capital needs.  

                       Possible Bankruptcy

If adequate funds are not available or are not available on
acceptable terms, the company will likely not be able to fund its
new teleradiology business, take advantage of unanticipated
opportunities, develop or enhance services or products, respond to
competitive pressures, or continue as a going concern beyond
June 30, 2008, and may have to seek bankruptcy protection.
    
                      About Merge Healthcare

Merge Healthcare Inc. (Nasdaq: MRGE; TSX: MRG) --
http://www.merge.com/-- is a developer of medical imaging and  
clinical software applications and developmental tools.  The
company develops medical imaging software solutions that support
end-to-end business and clinical workflow for radiology department
and specialty practices, imaging centers and hospitals.


MESA AIR: Settles Litigation Involving Hawaiian Airlines
--------------------------------------------------------
Hawaiian Airlines reached late in April a settlement of its
lawsuit with Mesa Air Group, Inc., regarding Mesa's misuse of
confidential and proprietary information obtained during
Hawaiian's Chapter 11 plan of reorganization in 2004.

Mesa runs inter-island flight services operated under the go!
brand name.

Under the terms of the settlement and without admitting any
wrongdoing, Mesa will receive $37.5 million from a bond the
Company previously posted with the United States Bankruptcy Court
for the District of Hawaii.  Hawaiian Airlines will be entitled to
the remaining collateral of the Bond totaling $52.5 million.  

Mesa will withdraw its appeal of the $80 million judgment -- plus
interest, attorney's fees and costs -- awarded against Mesa by the
Bankruptcy Court in October 2007.  The cash payment is required to
be made within two business days of approval of a stipulation by
the bankruptcy court that will follow dismissal of the appeals.

The settlement does not restrict in any way go!'s ability to
continue to offer services in the Hawaiian interisland market.

Mark Dunkerley, Hawaiian's President and CEO, said, "This
settlement is the last chapter in the legal dispute over Mesa's
misuse of Hawaiian's confidential information. We were delighted
with the award of damages and this settlement."

On October 30, 2007, the Bankruptcy Court ruled in favor of
Hawaiian, awarding Hawaiian $80 million for damages incurred to
date and ordering that Mesa pay Hawaiian post-judgment interest
and its cost of litigation and reasonable attorneys fees.  In
November 2007, Mesa filed a notice of appeal to the ruling and was
required to post a $90 million bond as security for the judgment,
post judgment interest, and attorney's fees, pending the outcome
of the appeal.

As reported by the Troubled Company Reporter on Feb. 1, 2008, the
Hon. Robert Faris directed Mesa to pay Hawaiian Airlines Inc. $3.9
million for costs of litigation and attorneys' fees the carrier
incurred in their dispute over the misuse of confidential
information to gain an unfair competitive advantage.

The TCR said Nov. 2, 2007, that the $80 million in damages was
awarded to compensate Hawaiian for damages it suffered through
October 2007.  The court did not award damages for any injury
Hawaiian may sustain in the future as a result of Mesa's
misconduct.

                    About Hawaiian Airlines

Hawaiian Airlines, Inc. -- http://www.hawaiianair.com/-- a  
subsidiary of Hawaiian Holdings Inc. (Amex: HA), provides
passenger air service between the U.S. mainland and Hawaii.  The
company also offers nonstop service to Hawaii from more U.S.
gateway cities than any other airline, as well as service to the
Philippines, Australia, American Samoa, and Tahiti.  Hawaiian also
provides approximately 145 daily jet flights among the Hawaiian
Islands.

The company filed a voluntary petition for reorganization under
Chapter 11 of the United States Bankruptcy Code in the U.S.
Bankruptcy Court for the District of Hawaii (Case No. 03-00827) on
March 21, 2003.  Joshua Gotbaum served as the chapter 11 trustee
for Hawaiian Airlines, Inc.  Mr. Gotbaum was represented by Tom E.
Roesser, Esq., and Katherine G. Leonard, Esq., at Carlsmith Ball
LLP and Bruce Bennett, Esq., Sidney P. Levinson, Esq., Joshua D.
Morse, Esq., and John L. Jones, II, Esq., at Hennigan, Bennett &
Dorman LLP. The Bankruptcy Court confirmed the Chapter 11
Trustee's Plan of Reorganization on March 10, 2005.  The Plan took
effect on June 2, 2005.

                          About Mesa Air

Mesa currently operates 182 aircraft with over 1,000 daily system
departures to 157 cities, 42 states, the District of Columbia,
Canada, the Bahamas and Mexico. Mesa operates as Delta Connection,
US Airways Express and United Express under contractual agreements
with Delta Air Lines, US Airways and United Airlines, and
independently as Mesa Airlines and go!.  In June 2006 Mesa
launched inter-island Hawaiian service as go!  This operation
links Honolulu to the neighbor island airports of Hilo, Kahului,
Kona and Lihue.  The Company, founded by Larry and Janie Risley in
New Mexico in 1982, has approximately 5,000 employees and was
awarded Regional Airline of the Year by Air Transport World
magazine in 1992 and 2005. Mesa is a member of the Regional
Airline Association and Regional Aviation Partners.

On May 14, 2008, Air Midwest, Inc., a wholly owned subsidiary of
Mesa Air, unveiled plans to discontinue all operations by June 30
including its current scheduled services, citing record-high fuel
prices, insufficient demand and a difficult operating environment
as the main factors in its decision.


MESA AIR: Won't File March 2008 Quarterly Report on Time
--------------------------------------------------------
Mesa Air Group, Inc., won't be able to file its quarterly
financial report for the period ended March 31, 2008, on time.

In a filing with the Securities and Exchange Commission, Brian S.
Gillman, Mesa Air's Executive Vice President, General Counsel and
Secretary, explains that certain information required in Mesa
Air's Quarterly Report on Form 10-Q for the quarter ended December
31, 2007, necessary for an accurate and full completion of the
March 31 report could not be provided within the proscribed time
period without unreasonable effort or expense.

Mesa Air expects to report a profit in the current quarter versus
the comparable quarter of prior fiscal year due to certain
nonrecurring charges, according to Mr. Gillman.

Mesa currently operates 182 aircraft with over 1,000 daily system
departures to 157 cities, 42 states, the District of Columbia,
Canada, the Bahamas and Mexico. Mesa operates as Delta Connection,
US Airways Express and United Express under contractual agreements
with Delta Air Lines, US Airways and United Airlines, and
independently as Mesa Airlines and go!.  In June 2006 Mesa
launched inter-island Hawaiian service as go!  This operation
links Honolulu to the neighbor island airports of Hilo, Kahului,
Kona and Lihue.  The Company, founded by Larry and Janie Risley in
New Mexico in 1982, has approximately 5,000 employees and was
awarded Regional Airline of the Year by Air Transport World
magazine in 1992 and 2005. Mesa is a member of the Regional
Airline Association and Regional Aviation Partners.

On May 14, 2008, Air Midwest, Inc., a wholly owned subsidiary of
Mesa Air, unveiled plans to discontinue all operations by June 30
including its current scheduled services, citing record-high fuel
prices, insufficient demand and a difficult operating environment
as the main factors in its decision.

MESABA AVIATION: Andy Roberts Appointed to Lead Company
-------------------------------------------------------
Andy Roberts, executive vice president for operations of
Northwest Airlines Corporation, will manage Mesaba Aviation, Inc.
starting June 16, 2008, The Associated Press reports.

News of Mr. Roberts' appointment came after Northwest issued a
statement disclosing that Neal Cohen, executive vice president -
strategy, international and CEO regional airlines, will leave the
Company effective June 16, 2008.

Mr. Cohen returned to Northwest in May 2005 as executive vice
president and chief financial officer.  He played a vital role in
leading the Company's restructuring efforts and upon Northwests
emergence from bankruptcy, in June 2007, Cohen was promoted to
his current position.

Northwest Airlines' President and Chief Executive Officer, Doug
Steenland, said, "Neal made tremendous contributions during a
critical time for Northwest Airlines.  His leadership throughout
the restructuring process positioned the Company well during an
extremely tumultuous period in the industry.  We're grateful that
Neal returned to the airline to help guide Northwest through the
restructuring process and we wish him the very best in his future
endeavors."

Discussing his departure, Mr. Cohen said, "Over the past three
years, we have worked collaboratively to reposition Northwest and
secure its future for the long-term.  Having successfully
completed the restructuring process, and with the impending
merger with Delta, I'm excited about the opportunity to pursue
business interests outside of the airline industry that I put on
hold when I returned to Northwest.  I'm confident that the
airline will continue to be an industry leader and am proud to
have been a part of its success."

Neal Cohen, 48, was executive vice president of finance and chief
financial officer for US Airways from April 2002 to April 2004.
Prior to US Airways, Cohen served as chief financial officer for
various service and financial organizations.  He spent nine years
with Northwest, from 1991 to 2000, where he held a number of
senior positions including senior vice president and treasurer.
Prior to joining Northwest, he spent seven years at General
Motors' Treasurers office in New York.

                    About Northwest Airlines

Northwest Airlines Corp. (NYSE: NWA) -- http://www.nwa.com/--   
is the world's fourth largest airline with hubs at Detroit,
Minneapolis/St. Paul, Memphis, Tokyo and Amsterdam, and about
1,400 daily departures.  Northwest is a member of SkyTeam, an
airline alliance that offers customers one of the world's most
extensive global networks.  Northwest and its travel partners
serve more than 1000 cities in excess of 160 countries on six
continents.  Northwest and its travel partners serve more than
1000 cities in excess of 160 countries on six continents,
including Italy, Spain, Japan, China, Venezuela and Argentina.

The company and 12 affiliates filed for chapter 11 protection on
Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17930).  Bruce
R. Zirinsky, Esq., and Gregory M. Petrick, Esq., at Cadwalader,
Wickersham & Taft LLP in New York, and Mark C. Ellenberg, Esq.,
at Cadwalader, Wickersham & Taft LLP in Washington represent the
Debtors in their restructuring efforts.  The Official Committee
of Unsecured Creditors has retained Akin Gump Strauss Hauer &
Feld LLP as its bankruptcy counsel in the Debtors' chapter 11
cases.

When the Debtors filed for bankruptcy, they listed $14.4 billion
in total assets and $17.9 billion in total debts.  On Jan. 12,
2007 the Debtors filed with the Court their Chapter 11 Plan.  On
Feb. 15, 2007, they Debtors filed an Amended Plan & Disclosure
Statement.  The Court approved the adequacy of the Debtors'
Disclosure Statement on March 26, 2007.  On May 21, 2007, the
Court confirmed the Debtors' Plan.  The Plan took effect May 31,
2007.  (Northwest Airlines Bankruptcy News, Issue No. 92;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).   

                         *     *     *

As reported in the Troubled Company Reporter on April 17, 2008,
Moody's Investors Service placed the debt ratings of Delta Air
Lines, Inc. ("Delta", corporate family at B2) and Northwest
Airlines Corporation ("Northwest", corporate family rating at B1)
on review for possible downgrade.  The review was prompted by the
announcement that the two airlines have agreed to combine in an
all-stock transaction with a combined enterprise value of
approximately $18 billion.

Fitch Ratings has affirmed the debt ratings of Delta Air Lines,
Inc. following the announcement that Delta has agreed to merge
with Northwest Airlines Corp., subject to approval by the two
airlines' shareholders and the U.S. Department of Justice.  
Delta's ratings were affirmed as: Issuer Default Rating at 'B';
First-lien senior secured credit facilities at 'BB/RR1'; Second-
lien secured credit facility (Term Loan B) at 'B/RR4'.

The issue ratings apply to $2.5 billion of committed credit
facilities.  The Rating Outlook for Delta has been revised to
Negative from Stable.

Standard & Poor's Ratings Services placed its ratings, including
the 'B+' long-term corporate credit rating, on Northwest Airlines
Corp. on CreditWatch with negative implications, following
announcement of a merger agreement with Delta Air Lines Inc.
(B/Watch Pos/--).  The CreditWatch listing affects enhanced
equipment trust certificates with various ratings, excepting those
that are insured by a bond insurer.  S&P's listing of Northwest
ratings on CreditWatch with negative implications and those of
Delta on CreditWatch with positive implications implies that S&P
foresee a corporate credit rating of either 'B' or 'B+' for the
combined entity.

                    About Mesaba Aviation

Based in Eagan, Minnesota, Mesaba Aviation Inc., dba Mesaba
Airlines -- http://www.mesaba.com/-- operates as a Northwest  
Airlink affiliate under code-sharing agreements with Northwest
Airlines(OTC:NWACQ.PK).  The company filed for chapter 11
protection on Oct. 13, 2005 (Bankr. D. Minn. Case No. 05-39258).  
Michael L. Meyer, Esq., at Ravich Meyer Kirkman McGrath & Nauman
PA, represented the Debtor in its restructuring efforts.  Craig D.
Hansen, Esq., at Squire Sanders & Dempsey, L.L.P., represented the
Official Committee of Unsecured Creditors.  When the Debtor filed
for protection from its creditors, it listed total assets of
$108,540,000 and total debts of $87,000,000.  The U.S. Bankruptcy
Court for the District of Minnesota confirmed Mesaba's Modified
Plan of Reorganization on April 9, 2007.  Mesaba exited bankruptcy
on April 24, 2007, and was later acquired by Northwest Airlines
from MAIR Holdings Inc.  (Mesaba Bankruptcy News, Issue No. 54;
Bankruptcy Creditors' Service Inc.; http://bankrupt.com/newsstand/
or 215/945-7000)


MESABA AVIATION: Liquidating Trustee Appeals MAC Ruling
-------------------------------------------------------
Odyssey Capital Group, LLC, as the liquidating trustee for Mesaba
Aviation, Inc.'s modified Plan of Reorganization, asks the United
States District Court for the District of Minnesota to determine
whether the U.S. Bankruptcy Court for the District of Minnesota
erred in:

  (a) granting Metropolitan Airports Commission's motion for
      summary judgment;

  (b) denying the Trustee's cross-motion for summary judgment;

  (c) excluding from evidence the opinions of Trustee's expert
      witness, Jeffrey A. Johnson of Integra Realty Resources,
      regarding:

      * the fair market value of the Hangar and the MN Airlines
        Lease; and

      * the appropriate discount rate to be used in calculating
        present value pursuant to the Bankruptcy Court's order
        granting MAC's Motion in Limine on February 12, 2008.

          Bankruptcy Court Ruling Must be Reversed

The Liquidating Trustee asks the District Court to (i) reverse
the Bankruptcy Court's order; (ii) disallow Claim No. 958 in its
entirety; and (iii) direct MAC to repay all amounts paid by the
Trustee on account of Claim 958.

Mark L. Meyer, Esq., at Ravich Meyer Kirkman McGrath Nauman &
Tansey, in Minneapolis, Minnesota, contends that:

  -- MAC is not entitled to the presumption of validity under
     the Bankruptcy Code;

  -- MAC failed to properly calculate its damages; and

  -- MAC's asserted damages are speculative, remote and
     based on incomplete evidence.

As previously reported, the Debtor rejected an airport hangar
lease with MAC, as the lessor, with 20 years remaining on the
term of the lease.  The Debtor originally agreed to lease the
hangar at $1,328,686 plus annual costs of approximately $240,000.

MAC filed Claim No. 958 for $3,249,233, asserting damages
resulting from the Debtor's rejection of the Lease.

The Liquidating Trustee objected to the Claim because MAC has
identified one or more tenants to whom it will re-let some or all
of the property, and MAC has otherwise failed to mitigate its
damages.

MAC contended that it has already mitigated its damages by
entering into a new lease with Sun Country Airlines and that it
incurred damages amounting to $27,980,490 before entering into
the New Lease.  MAC secured the New Lease in less than one year
after the Debtor rejected their Lease.  The New Lease has a
10-year initial term from 2008 to 2017, and a 10-year tenant
renewal option for years 2018-2027.

Mr. Meyer relates that the dispute focuses primarily on whether,
in applying Minnesota law's measure of the damages, the hangar
subject to the Lease has any rental value during the Option
Period.  MAC argues that it deserves to collect all lease
payments due under the Mesaba Lease during the Option Period.

The Liquidating Trustee wanted Mr. Johnson to provide expert
opinion on the fair market value of the hangar.

However, MAC asked the Bankruptcy Court to exclude Mr. Johnson's
opinion as support to the Liquidating Trustee's objection arguing
that Mr. Johnson has not conducted any discovery before the
deadline to do so.  The Liquidating Trustee told the Bankruptcy
Court that the deadline is impracticable in the matter under
Federal Rules of Civil Procedure.  The two parties made their
requests "in limine" or immediately before the start of a
hearing.  Consequently, the Bankruptcy Court excluded Mr. Johnson
from testifying as to the rental value of the hangar and the
appropriate discount factor to be used in determining the present
value of MAC's damages.

In addition, each of MAC and the Liquidating Trustee asked the
Bankruptcy Court to enter summary judgment against the other.  
The Bankruptcy Court granted MAC's request for summary judgment.

Mr. Meyer contends that the Bankruptcy Court erroneously
determined that the New Lease was not evidence of the Hangar's
Rental Value and that the hypothetical risk that the property may
not be leased in the Option Period rendered the Hangar valueless
during the Option Period.  He asserts that the only competent
evidence of the Rental Value of the Hangar is the New Lease,
which resulted from an arm's-length negotiation.

MAC's Claim No. 958 is defective on its face because MAC failed
to properly calculate damages according to Minnesota law,
Mr. Meyer says.  MAC must prove that it sustained recoverable
damages.

According to Mr. Meyer, while it is conceivable that the Hangar
could sit empty for a decade, it is not a credible position in
light of the undisputed facts in the record and is not the
standard under Minnesota law.

Minnesota law on lease damages requires deducting Rental Value of
the Hanger, not merely the rent contracted to be paid.  The
Hangar itself has a clear Rental Value evidenced by the Sun
Country Lease, Mr. Meyer relates.

MAC will be better off with the Sun Country Lease than with the
Mesaba Lease,  Mr. Meyer says.  If Sun Country will exercise its
Option, MAC will receive not less than $2,000,000, in percentage
rent, he says.

According to Mr. Meyer, Mr. Johnson stated clearly in his
deposition that the best evidence of Rental Value or future
rental stream of the Hangar, as opposed to the present discounted
value of that Rental Value, is the rent negotiated in the Sun
Country Lease.  

The Bankruptcy Court erred in concluding that there was "no
information disclosed" at the Johnson Deposition, Mr. Meyer
maintains.  Mr. Johnson's testimony regarding evidence of the
Rental Value of the Hangar should be admitted as evidence, he
adds.

              MAC Asserts Ruling Should be Upheld

The Metropolitan Airports Commission asserts that the Bankruptcy
Court's decision granting summary judgment against Odyssey
Capital Group, LLC, the liquidating trustee for Mesaba Aviation,
Inc.'s modified Plan of Reorganization, should be upheld.

Connie A. Lahn, Esq., at Fafinski Mark & Johnson, P.A., in Eden
Prairie, Minnesota, asserts that a decision by a lower court to
exclude expert testimony due to a failure to comply with
discovery deadlines is only reversed if there was a gross abuse
of discretion resulting in fundamental unfairness.

Ms. Lahn contends that MAC's claim is undisputed because:

  -- the Liquidating Trustee failed to produce evidence
     disputing it;

  -- MAC mitigated its damages; and

  -- MAC properly calculated its damages.

Mesaba's rejection of the Lease constitutes a breach, Ms. Lahn
asserts.  The breach resulted in damages incurred by MAC for
$27,980,490 in unpaid rent due under the remaining term.

According to Ms. Lahn, MAC experienced many difficulties in
finding a new tenant for the Hangar.  The Hangar was custom-
designed by Mesaba for its own needs, it is smaller than the
average hangars at the Minneapolis-St. Paul International
Airport, or MSP, and is not large enough to accommodate the
commercial aircraft regularly flown at MSP.  The only carriers
that could use the Hangar were: Northwest Airlines, Sun Country
Airlines, and Champion Air.  However, the Hangar is too small for
the large commercial aircraft used by these carriers, Ms. Lahn
relates.

MAC must limit the use of hangars at MSP for aviation-related
activities, pursuant to a bond financing obtained by MAC to
finance construction of the Hangar, Ms. Lahn says.  There are
also security concerns that limit the types of tenants that can
operate at MSP.

Ms. Lahn relates that MAC directly contacted every party that
realistically could be a tenant for the Hangar.  MN Airlines,
doing business as Sun Country Airlines, is an affiliate of
Petters Aviation, and was the only carrier who expressed any
interest in the Hangar.

Ms. Lahn asserts that neither MN Airlines nor MAC knows whether
MN Airlines will exercise its option to renew the lease.  The
option has no value to MAC because MAC has no power to exercise
the option.  MAC is still liable to make the Bond payments if the
option is not exercised.  An unoccupied hangar has no value to
MAC, she says.

If MN Airlines does not exercise the option, it is uncertain
whether MAC will be able to re-lease the Hangar to another
tenant, or for what price, Ms. Lahn contends.  

"The airline industry is extremely volatile," Ms. Lahn reminds
the Court.  "MAC does not know what will happen in this industry
in 10 years.  In the last 10 years, virtually every major tenant
at MSP has filed for bankruptcy.  Fuel costs are at an all-time
high, negatively impacting the industry, and most of MAC's
hangar space is currently underutilized because of these changing
conditions."

Ms. Lahn further points out that the Liquidating Trustee did not
describe the substance of Mr. Johnson's expert opinions, nor did
it describe the basis for his opinions.  As a result, MAC had no
idea, at the close of discovery, what Mr. Johnson's expert
opinion would be, she says.

                    About Mesaba Aviation

Based in Eagan, Minnesota, Mesaba Aviation Inc., dba Mesaba
Airlines -- http://www.mesaba.com/-- operates as a Northwest  
Airlink affiliate under code-sharing agreements with Northwest
Airlines(OTC:NWACQ.PK).  The company filed for chapter 11
protection on Oct. 13, 2005 (Bankr. D. Minn. Case No. 05-39258).  
Michael L. Meyer, Esq., at Ravich Meyer Kirkman McGrath & Nauman
PA, represented the Debtor in its restructuring efforts.  Craig D.
Hansen, Esq., at Squire Sanders & Dempsey, L.L.P., represented the
Official Committee of Unsecured Creditors.  When the Debtor filed
for protection from its creditors, it listed total assets of
$108,540,000 and total debts of $87,000,000.  The U.S. Bankruptcy
Court for the District of Minnesota confirmed Mesaba's Modified
Plan of Reorganization on April 9, 2007.  Mesaba exited bankruptcy
on April 24, 2007, and was later acquired by Northwest Airlines
from MAIR Holdings Inc.  (Mesaba Bankruptcy News, Issue No. 54;
Bankruptcy Creditors' Service Inc.; http://bankrupt.com/newsstand/
or 215/945-7000)


MICROMET INC: Posts $5.9 Million Net Loss in 2008 First Quarter
---------------------------------------------------------------
Micromet Inc. reported a net loss of $5.9 million for the three
months ended March 31, 2008, compared to a net loss of
$7.6 million for the same period in 2007.

For the three months ended March 31, 2008, Micromet recognized
total revenues of $5.9 million, compared to $2.8 million for the
same period in 2007.  Total operating expenses were $13.3 million
for the three months ended March 31, 2008, compared to
$10.3 million for the same period in 2007.  

Micromet's cash and cash equivalents were $27.7 million as of
March 31, 2008.  Net cash provided by operating activities was
$364,000 for the quarter ended March 31, 2008, compared to
$7.9 million used in operating activities for the same period in
2007.

                          Balance Sheet

At March 31, 2008, the company's consolidated balance sheet showed
$53.2 million in total assets, $33.4 million in total liabilities,
and $19.8 million in total stockholders' equity.

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?2bf0

                          Going Concern

The company disclosed in its Form 10-Q for the first quarter of
2008, that as of March 31, 2008, the company had an accumulated
deficit of $170.8 million, and its expects to continue to incur
substantial, and possibly increasing, operating losses for the
next several years.  The company says that these conditions create
substantial doubt about the company's ability to continue as a
going concern.

                       About Micromet Inc.

Micromet Inc. (Nasdaq: MITI) -- http://www.micromet-inc.com/-- is  
a biopharmaceutical company developing novel, proprietary
antibodies for the treatment of cancer, inflammation and
autoimmune diseases.  Four of its antibodies are currently in
clinical trials, while the remainder of the product pipeline is in
preclinical development.


ML-CFC COMMERCIAL: Moody's Holds B3 Rating on $4.603MM Cl. P Trust
------------------------------------------------------------------
Moody's Investors Service affirmed the ratings of 22 classes of
ML-CFC Commercial Mortgage Securities Trust, Series 2006-2 as:

  -- Class A-1, $39,050,605, affirmed at Aaa
  -- Class A-2, $88,159,000, affirmed at Aaa
  -- Class A-3, $54,481,000, affirmed at Aaa
  -- Class A-SB, $91,905,000, affirmed at Aaa
  -- Class A-4, $734,750,000, affirmed at Aaa
  -- Class A-1A, $263,114,771, affirmed at Aaa
  -- Class A-M, $184,145,000, affirmed at Aaa
  -- Class A-J, $130,108,000, affirmed at Aaa
  -- Class X, Notional, affirmed at Aaa
  -- Class B, $36,829,000, affirmed at Aa2
  -- Class C, $16,113,000, affirmed at Aa3
  -- Class D, $32,225,000, affirmed at A2
  -- Class E, $18,415,000, affirmed at A3
  -- Class F, $29,923,000, affirmed at Baa1
  -- Class G, $18,415,000, affirmed at Baa2
  -- Class H, $20,716,000, affirmed at Baa3
  -- Class J, $9,207,000, affirmed at Ba1
  -- Class K, $4,604,000, affirmed at Ba2
  -- Class L, $6,905,000, affirmed at Ba3
  -- Class M, $2,302,000, affirmed at B1
  -- Class N, $4,604,000, affirmed at B2
  -- Class P, $4,603,000, affirmed at B3

Moody's is affirming the transaction due to overall stable pool
performance.

As of the April 14, 2008 distribution date, the transactions
aggregate certificate balance has decreased by approximately 1.0%
to $1.80 billion from $1.82 billion at securitization.  The
certificates are collateralized by 191 loans ranging in size from
less than 1.0% to 9.9% of the pool with the top 10 loans
representing 32.3% of the pool.  The pool includes one loan (9.9%
of the pool) with an underlying rating.

Moody's was provided year-end 2006 and 2007 operating results for
86.5% and 59.3% of the pool, respectively.  Moody's weighted
average loan to vale ratio for the conduit component in 102.3%
compared to 101.3% at securitization.

The trust has not realized any losses since securitization.
Currently there is one loan representing less than 1.0% of the
pool in special servicing.  Moody's is not currently estimating a
loss at this time.  Twenty-two loans, representing 5.8% of the
pool, are on the master servicer's watchlist.  The master
servicer's watchlist includes loans which meet certain portfolio
review guidelines established as part of the Commercial Mortgage
Securities Association monthly reporting package.  As part of
Moody's ongoing monitoring of a transaction, Moody's reviews the
watchlist to assess which loans have material that could impact
performance.  Not all loans on the watchlist are delinquent or
have significant issues.

The loan with an underlying rating is the 100 Summer Street Loan
($180.0 million -- 9.9%), which is secured by a 1.1 million square
foot class A office building located in downtown Boston,
Massachusetts.  The property was approximately 100% occupied as of
December 2007 compared with 97.4% at securitization.  Major
tenants include Fidelity Properties, Lexington Insurance Company,
and Nixon Peabody, which together lease 53.6% of the property.  
Moody's current underlying rating is Baa2, compared to Baa3 at
securitization.

The top three conduit loans represent 12.6% of the outstanding
pool balance.  The largest conduit loan is the Penn Mutual Towers
and Washington Square Garage Loan ($102.8 million -- 5.6%), which
is secured by a 853,840 square foot Class A property located in
downtown Philadelphia, Pennsylvania.  The property was
approximately 98% occupied as of January 2008 compared with 95.2%
at securitization.  The loan matures in April 2016.  Moody's LTV
is 108.2%, the same as at securitization.

The second largest conduit loan is the 200 Paul Loan ($80.3
million -- 4.4%), which is secured by a 527,680 square foot
telecommunications building located in close proximity to the main
fiber optic line that serves San Francisco, California.  The loan
matures in October 2015.  Moody's LTV is 93.5%, compared to 94.3%
at securitization.

The third largest conduit loan is the CNL-Cirrus MOB Portfolio III
Loan ($47.2 million -- 2.6%), which is secured by five medical
office properties located in two states and totaling 269,707
square feet.  The properties were approximately 88.9% occupied as
of December 2007 compared with 91.5% at securitization.  The loan
matures in April 2016.  Moody's LTV is 99.7%, compared to 104.0%
at securitization.


MOORE CUSTOM: Case Summary & Four Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Moore Custom Homes, Ltd.
        3301 Merrimack
        Flower Mound, TX 75022

Bankruptcy Case No.: 08-41170

Chapter 11 Petition Date: May 5, 2008

Court: Eastern District of Texas (Sherman)

Debtor's Counsel: Roy G. Morris, Esq.
                  Email: rmorris@morris-law.com
                  The Morris Legal Group
                  610 Parker Square
                  Flower Mound, TX 75028
                  Tel: (972) 539-0090
                  Fax: (972) 539-1464

Total Assets: $3,350,000

Total Debts:  $2,390,500

Debtor's Four Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
Chase Bank                     Line of Credit        $75,000
P.O. Box 78039
Phoenix, AZ 85062

Denton County Tax Assessor     Taxes                 $38,000
Attn: Steve Mossman
P.O. Box 90223
Denton, TX 76202

Roy G. Morris                  Attorney Fees         $14,000
610 Parker Square
Flower Mound, TX 75028

Chase Bank                     Credit Card           $10,500


MORGAN STANLEY: Moody's Holds Low-B Ratings on Four Cert. Classes
-----------------------------------------------------------------
Moody's Investors Service upgraded the ratings of five classes and
affirmed the ratings of 11 classes of Morgan Stanley Dean Witter
Capital I Trust 2002-HQ, Commercial Mortgage Pass-Through
Certificates, Series 2002-HQ as:

  -- Class A-2, $9,848,806, affirmed at Aaa
  -- Class A-3, $363,674,000, affirmed at Aaa
  -- Class X-1, Notional, affirmed at Aaa
  -- Class X-2, Notional, affirmed at Aaa
  -- Class B, $32,781,000, affirmed at Aaa
  -- Class C, $29,608,000, affirmed at Aaa
  -- Class D, $7,402,000, affirmed at Aaa
  -- Class E, $10,574,000, upgraded to Aaa from Aa1
  -- Class F, $8,460,000, upgraded to Aaa from Aa2
  -- Class G, $8,459,000, upgraded to Aa2 from A1
  -- Class H, $14,804,000, upgraded to Baa1 from Baa2
  -- Class J, $6,345,000, upgraded to Baa3 from Ba1
  -- Class K, $6,344,000, affirmed at Ba2
  -- Class L, $8,460,000, affirmed at B1
  -- Class M, $6,344,000, affirmed at B2
  -- Class N, $2,115,000, affirmed at B3

Moody's is upgrading Classes E, F, G, H and J due to increases in
credit support, defeasance and overall improved pool performance.

As of the April 15th 2008 distribution date, the transaction's
aggregate certificate balance has decreased by approximately 37.8%
to $525.8 million from $846.0 million at securitization.  The
Certificates are collateralized by 64 mortgage loans ranging in
size from less than 1.0% to 23.1% of the pool, with the top 10
non-defeased loans representing 47.6% of the pool.  The pool's
largest loan has an underlying rating. Sixteen loans, representing
25.3% of the pool, have defeased and are secured by U.S.
Government securities.

The pool has not experienced any realized losses. Currently one
loan, representing 1.7% of the pool, is in special servicing.
Moody's is estimating a $1.0 million loss from this specially
serviced loan.  Ten loans, representing 12.8% of the pool, are on
the master servicer's watchlist.  The master servicer's watchlist
includes loans which meet certain portfolio review guidelines
established as part of the Commercial Mortgage Securities
Association monthly reporting package.  As part of our ongoing
monitoring of a transaction, Moody's reviews the watchlist to
assess which loans have material issues that could impact
performance.  Not all loans on the watchlist are delinquent or
have significant issues.

Moody's was provided with full-year 2006 and partial-year 2007
operating results for 98.0% and 95.0% of the pool, respectively.  
Moody's loan to value ratio for the conduit component, excluding
the defeased loans, is 82.8% compared to 85.9% at Moody's last
full review in March 2007 and 85.8% at securitization.

The loan with an underlying rating is the Woodfield Mall Loan
($121.5 million -- 23.1%), which represents a participation
interest in a $242.9 million first mortgage loan.  The loan is
secured by the borrower's interest in a 2.2 million square foot
super regional shopping center located 25 miles northwest of
downtown Chicago in Schaumburg, Illinois.  As of July 2007, in-
line occupancy was 96.0% compared to 99.1% at last review.  The
borrower is a joint venture between the California Public
Employees' Retirement System and General Motors Pension Trust.  
The property is also encumbered by a $40.2 million B Note, which
is held outside the trust.  Moody's current underlying rating is
Aaa, the same as at last review.

The top three conduit loans represent 14.5% of the outstanding
pool balance.  The largest conduit loan is the CBL Portfolio Loan
($36.4 million - 6.9%), which is secured by three shadow anchored
retail properties totaling 617,000 square feet.  The properties
are Willowbrook Plaza (Houston, Texas); Massard Crossing (Fort
Smith, Arkansas); and Pemberton Plaza (Vicksburg, Mississippi).  
As of December 2007, the portfolio was 91.0% occupied compared to
93.0% at last review.  Performance has declined since last review
based on decreased revenues and increased expenses.  Moody's LTV
is 88.2% compared to 86.1% at last review.

The second largest conduit loan is the Denver West Village Loan
($22.4 million - 4.3%), which is secured by a 310,000 square foot
power center located in Lakewood, Colorado.  The center is
anchored by United Artists Theaters, Ultimate Electronics and Bed
Bath & Beyond.  The center was 94.1% occupied as of June 2007, the
same as at last review.  The loan is on the master servicer's
watchlist due to a debt service coverage ratio below 1.20. Moody's
LTV is 98.6% compared to 98.2% at last review.

The third largest conduit loan is the Enterprise Center Loan
($17.4 million - 3.3%), which is secured by an 189,000 square foot
office building located in Chantilly, Virginia.  The property was
78.3% occupied as of December 2007 compared to 80.0% at last
review and 100.0% at securitization.  The largest tenant is the
International Bank for Reconstruction and Development, occupying
29.0% of the premises through January 2013.  The loan is on the
master servicer's watchlist due to a debt service coverage ratio
below 1.20. Moody's LTV is 98.7%, essentially the same as at last
review.


MOULDING FX: Voluntary Chapter 11 Case Summary
----------------------------------------------
Debtor: Moulding FX, LC
        P.O. Box 27834
        Salt Lake City, UT 84127-0834

Bankruptcy Case No.: 08-22905

Type of Business: The Debtor provides moulding services.

Chapter 11 Petition Date: May 5, 2008

Court: District of Utah (Salt Lake City)

Debtor's Counsel: Andres' Diaz, Esq.
                  Email: courtmail@adexpresslaw.com
                  1 On 1 Legal Services
                  307 West 200 S., Ste. 3004
                  Salt Lake City, UT 84101
                  Tel: (801) 596-1661
                  Fax: (801) 359-6803

Estimated Assets:   $500,000 to $1 million

Estimated Debts: $1 million to $10 million

The Debtor did not file a list of its largest unsecured creditors.


MTI GLOBAL: Has Until May 31 to Amend Credit Facility with Lender
-----------------------------------------------------------------
MTI Global Inc. is subject to an amended forbearance agreement
with its principal lender, a Canadian chartered bank dated
Feb. 22, 2008, pursuant to which the company has until May 31,
2008, to amend its credit facilities with the Bank.

The agreement also commits the company to raise sufficient capital
to repay the term loan then outstanding and meet its other
liquidity needs.  Pursuant to the amended forbearance agreement,
the company did not achieve its March 31, 2008, earnings before
interest, taxes and depreciation covenant and a general covenant.

The Bank has agreed to a continued forbearance of the defaults
while the company proceeds to satisfy the terms of the amended
forbearance agreement.

The company is proceeding through a process to meet the
requirements of the amended forbearance agreement.  As part of
this process the company has signed a non-binding agreement with a
private capital source for $7.0 million of mezzanine financing
subject to the completion of due diligence and documentation.
These funds will be utilized to repay the term bank loan, for
restructuring, and for other corporate initiatives.

The company reported net loss of $914,000, a decline from a net
income of $7,000 for the same period last year.

Subsequent to quarter end these restructuring initiatives were
disclosed:

   -- The Buchanan, Virginia plant will be closed and the
      operations will be moved to the two remaining U.S. silicone   
      operations facilities in Milton, Florida and Richmond,
      Virginia during the second half of 2008.

   -- The Polyfab Aerospace plant in Mississauga, Ontario will be
      closed and the transfer of production to Mexico completed by
      the end of May 2008.

At March 31, 2008, the company's balance sheet showed total assets
of C$61.2 million, total liabilities of C$22.4 million and total
shareholders' equity of C$38.8 million  

                        About MTI Global

Headquartered in Mississauga, Ontario, MTI Global Inc. (TSX: MTI)
-- http://www.mtiglobalinc.com/-- designs, develops and
manufactures custom-engineered products using silicone and other
cellular materials.  The company serves a variety of specialty
markets focused on three main product categories: Silicone,
Aerospace and Fabricated Products.  MTI's Canadian manufacturing
operations are located in Mississauga, Ontario, with international
manufacturing operations located in Richmond and Buchanan,
Virginia; Pensacola, Florida; Bremen, Germany; and a contract
manufacturer venture in Ensenada, Mexico.  The company also has
sales operations in England and Sweden, and an engineering support
centre in Brazil.


NEW CENTURY: Claimants Buck Plan; Proponents Push for Confirmation
------------------------------------------------------------------
The First Amended Joint Chapter 11 Plan of Liquidation prepared
by New Century Financial Corp. and its debtor-affiliates, and the
Official Committee of Unsecured Creditors cannot be confirmed
under Section 1129(a) of the Bankruptcy Code, since it violates
Section 1123(a)(4) by providing a greater distribution to the
Master Repurchase Agreement Creditors, said Gregory J. Schroeder,
Michelle Parker, Martin Warren, Steve Holland, Nabile Bawa and the
Ad Hoc Committee of Beneficiaries of the New Century Financial
Corporation Deferred Compensation Plan and Supplemental Executive
Retirement/Savings Plan, in a post-hearing brief.

Judge Kevin Carey of the U.S. Bankruptcy Court for the District of
Delaware had allowed the parties to make post-hearing submissions
supporting or objecting to the confirmation of the Plan.

Under the Plan, the MRA Creditors are included in the Class of
Other Unsecured Creditors of NCFC -- Class HC3b, while their
claims are enhanced by factor of 30%.  The Plan Proponents had
explained that the disparate treatment for the class members was
because the MRAs had multiple claims against multiple debtors, as
did some other groups of creditors, and the discrimination was
justified because it was necessary to offset other adjustments.

On behalf of the Beneficiaries, Joseph H. Hurston, Esq., at
Stevens & Lee PC, in Wilmington, Delaware, says that the Plan
Proponents' justifications cannot support the intra-class
discrimination since it clearly violates Section 1123(a)(4).

The Beneficiaries add the Plan Proponents failed to satisfy
Section 1129(a)(7) because they did not prove that each member of
the dissenting class of New Century Financial Corp. unsecured
creditors will receive as much under the Plan as they would in a
Chapter 7 case.

Mr. Hurston also notes that the Holdco/Opco Model as specified in
the Plan involved substantive consolidation of all the holding
companies, as well as all the operating companies, as separate
groups.  According to Mr. Hurston, the Debtors' cases could not
support substantive consolidation under rigorous tests, citing in
re Owens Corning, 419 F.3d 195, 211 (3rd Cir. 2005).  The Plan
embodies substantive consolidation when the cases could not be
substantively consolidated.  In addition, the Plan required
adjusting compromises to mitigate the harm caused by substantive
consolidation.

Pursuant to Owens Corning's case and the Court's rulings therein,
Mr. Hurston contends that substantive consolidation with
compensating adjustments, as embodied in the Plan, is not
permitted.

           Plan Proponents Say Plan Should Be Confirmed

The Creditors Committee and the Debtors state the Amended Plan
provides a more efficient vehicle to accomplish the goal of
liquidating the Debtors' estates and distributing proceeds to
creditors, than a conversion to Chapter 7, and recoveries to
creditors will likely exceed than if the cases are converted.  
They note that no Plan Proponent will receive any special benefit
under the Plan.

The Debtors' counsel, Christopher M. Samis, Esq., at Richards,
Layton & Finger, P.A., in Wilmington, Delaware, asserts the Plan
is feasible, and the Debtors will have sufficient liquidity to
consummate the Plan.  The Plan should be confirmed, he contends.

The Plan Proponents note that they have dealt with the major
issues raised by the Deferred Compensation Claimants in their  
prehearing brief and in closing argument made on April 25, 2008.

Nonetheless, they reiterate that the Beneficiaries badly misstate
the Plan in their argument that the Beneficiaries will receive
inferior and different treatment compared to that of the MRA
Claimants.

The Plan Proponents maintain that the Plan provides the same
treatment for each claim in Class HC3b, and assert that the
Beneficiaries have misstated the Plan in their arguments.  They
state that every creditor in Class HC3b will receive equal
treatment -- its pro rata share of the litigation proceeds and
net distributable assets.  They point out that no claim in that
class is inflated.

The Plan Proponents aver that the Plan is a full and fair
resolution of the complex legal and factual issues in the
Debtors' Chapter 11 cases.  The Plan satisfies the standards of
the Bankruptcy Code is is supported by the creditor body, and
thus, should be confirmed, they assert.

                          *     *     *

In their summary of the evidentiary record supporting the Plan's
confirmation, the Plan Proponents addressed the "few limited
issues" they did not have an opportunity to address orally at the
April 25 hearing.

Among other things, the Plan Proponents presented facts
concerning uncertainties as to which Debtor owns the interests in
the Carrington Investments, totaling approximately $49,500,000,
the Rabbi Trust, the tax refunds, and certain servicing rights
that have been sold to Carrington Management LLC.

The Debtors represent that the money held in the Rabbi Trust was
funded by New Century Mortgage Corp.  NCMC also funded the
Carrington Investment.  NCFC, once the parent corporation prior
to October 2004, is now known as New Century TRS Holdings.
In addition to the Carrington Interests and the Rabbi Trust,
there are also certain intercompany claims including a
$240,600,000 NCMC net receivable from TRS Holdings, as well as
litigation proceeds.  

According to Mr. Samis, the controversy whether which Debtor
owned the assets contributed to the decision to pool assets for
the purposes of distributions under the Plan.  Further, the Plan
provides that the Litigation Proceeds will be shared among the
Debtors so that all creditors will benefit to a varying degree.  
The Tax Refunds will be attributed to NCMC based on the Debtors'
accounting, and which Debtor paid taxes and generated losses.  
The intercompany claims are dealt with through Determined
Distribution Amounts, settling complex intercompany and
intercreditor issues.

The Plan Proponents also set evidence concerning the Multi-Debtor
Claim Protocol and the EPD/Breach Claim Protocol, as well as the
joint administrative expense share set forth in the Plan.

A full-text copy of the Summary of the Evidentiary Record
Supporting the Plan is available at no charge at:

              http://ResearchArchives.com/t/s?2c05

                        About New Century

Founded in 1995, Irvine, Calif.-based New Century Financial
Corporation (NYSE: NEW) -- http://www.ncen.com/-- is a real    
estate investment trust, providing mortgage products to borrowers
nationwide through its operating subsidiaries, New Century
Mortgage Corporation and Home123 Corporation.  The company offers
a broad range of mortgage products designed to meet the needs of
all borrowers.

The company and its debtor-affiliates filed for Chapter 11
protection on April 2, 2007 (Bankr. D. Del. Lead Case No.
07-10416).  Suzzanne Uhland, Esq., Austin K. Barron, Esq., and
Ana Acevedo, Esq., at O'Melveny & Myers LLP, and Mark D. Collins,
Esq., Michael J. Merchant, Esq., and Jason M. Madron, Esq., at
Richards, Layton & Finger, P.A., represent the Debtors.  The
Official Committee of Unsecured Creditors selected Hahn & Hessen
as its bankruptcy counsel and Blank Rome LLP as its co-counsel.
When the Debtors filed for bankruptcy, they listed total assets
of $36,276,815 and total debts of $102,503,950.  The Debtors'
exclusive period to file a plan expired on Jan. 28, 2008. (New
Century Bankruptcy News, Issue No. 40; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).


NEWPAGE CORP: S&P Holds 'B' Rating and Revises Outlook to Positive
------------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on NewPage
Corp. to positive from stable.  S&P affirmed the 'B' corporate
credit rating and all other ratings on the Miamisburg, Ohio-based
coated-paper manufacturer.
     
"The outlook revision reflects our assessment that NewPage's
credit measures will strengthen over the next several quarters
because of improving operating performance," said Standard &
Poor's credit analyst Andy Sookram.  "Substantially higher prices
and benefits from cost-savings programs are helping to offset
higher input costs. As a result, we expect the company to generate
significant free cash flow, which will be used to reduce debt
balances that were increased to fund the acquisition of Stora Enso
Oyj's North American paper manufacturing operations in December
2007."
     
NewPage recently announced plans for an IPO of its common stock
during the second half of 2008.  It expects to use the proceeds to
reduce about $370 million in holding company debt.  As a result,
consolidated credit measures could improve further and be more
consistent with a higher rating.

"We expect the operating margin to increase to 15% and debt to
EBITDA ratio to improve to around 5.5x over the next several
quarters," Mr. Sookram said.  "We would consider an upgrade if the
company reduces debt and maintains the total debt to EBITDA ratio
below 5x as a result of improved operating performance and debt
reduction.  Alternatively, if market conditions deteriorate
because of a general economic slowdown, if cost savings and
synergies are delayed because of integration issues, or if debt
reduction takes longer than expected, we could revise the outlook
to stable."


NORD RESOURCES: March 31 Balance Sheet Upside-Down by $3 Million
----------------------------------------------------------------
Nord Resources Corporation's balance sheet at March 31, 2008,
showed total assets of $ 29.2 million and total liabilities of
$32.3 million, resulting in a total shareholders' deficit of
roughly $3.1 million.

The company incurred net loss of $675,000 for the first quarter
ended March 31, 2008, was compared with a net loss of $55,000 in
the comparable period in 2007.

"This was a significant period for Nord Resources in that we
achieved commercial copper production from residual leaching of
the existing ore heaps at the Johnson Camp Mine on Feb. 1, 2008,"
John Perry, president and chief executive officer, said.  "Our
plan, as disclosed on Feb. 21, 2008, is to complete reactivation
this year and to reach full copper production from new ore in
early spring 2009."

                 Liquidity and Financial Resources

The company's cash flows from operating activities during the
three months ended March 31, 2008, and 2007 were negative $532,132
and negative $114,079.

As of March 31, 2008, Nord Resources had drawn down $12 million of
the $25 million secured term-loan credit facility arranged in
June 2007 with Nedbank Limited.  The company believes that the
remaining $13 million available under the credit facility, funds
from the special warrant financing completed in June 2007, and
funds generated from operations will be sufficient to meet the
capital requirements to reactivate the Johnson Camp Mine.
    
                     About Nord Resources

Based in Tucson, Ariz., Nord Resources Corporation (Pink Sheets:
NRDS) -- http://www.nordresources.com/ -- is an emerging copper
producer, which controls a 100% interest in the Johnson Camp SX-EW
copper project in Arizona.  Nord's near term objective is to
resume mining and leaching operations at the Johnson Camp mine,
which has been on care and maintenance status since August 2003.
Nord has decided to proceed with its mine plan bases on an updated
feasibility study that was completed in October 2005, subject to
raising sufficient financing.

                       Going Concern Doubt

On March 26, 2008, Mayer Hoffman McCann PC, in Denver, Colorado,
expressed substantial doubt about Nord Resources Corporation's
ability to continue as a going concern after auditing the
company's consolidated financial statements as of the years ended
Dec. 31, 2007, and 2006.  The auditing firm company reported that
the company incurred a net loss of $2.5 million and $6.2 million
during the years ended Dec. 31, 2007, and 2006.  

The company's continuation as a going concern is dependent upon
its ability to generate sufficient cash flow to meet the company's
obligations on a timely basis, to produce copper at a level where
it can become profitable, to pay off existing debt and provide
sufficient funds for general corporate purposes.


NORTH AMERICAN: S&P Rates $545MM First-Lien Facilities BB+
----------------------------------------------------------
Standard & Poor's Ratings Services assigned its proposed 'BB+'
rating and '1' recovery rating to North American Energy Alliance
LLC's $545 million first-lien facilities, indicating the
expectation for very high (90% to 100%) recovery in the event of a
payment default.
     
At the same time, Standard & Poor's assigned its 'BB-' rating and
'4' recovery rating to NAEA's $325 million bridge loan, indicating
the expectation of average (30%-50%) recovery in the event of a
payment default.  The outlook is stable.
     
Proceeds from the issues will be combined with $815 million of
equity and used to acquire Consolidated Edison Development's
generation portfolio of six projects totaling 1,706 MW located in
ISO-NE and PJM.  The total cash consideration is $1.477 billion
($866/kw), translating to a debt-to-capital ratio of roughly 54%
(all facilities fully drawn plus $64.1 million of acquired debt).
The debt amount is $547/kW.


NORTHWEST AIRLNES: Appoints Andy Roberts to Lead Mesaba
-------------------------------------------------------
Andy Roberts, executive vice president for operations of
Northwest Airlines Corporation, will manage Mesaba Aviation, Inc.
starting June 16, 2008, The Associated Press reports.

News of Mr. Roberts' appointment came after Northwest issued a
statement disclosing that Neal Cohen, executive vice president -
strategy, international and CEO regional airlines, will leave the
Company effective June 16, 2008.

Mr. Cohen returned to Northwest in May 2005 as executive vice
president and chief financial officer.  He played a vital role in
leading the Company's restructuring efforts and upon Northwests
emergence from bankruptcy, in June 2007, Cohen was promoted to
his current position.

Northwest Airlines' President and Chief Executive Officer, Doug
Steenland, said, "Neal made tremendous contributions during a
critical time for Northwest Airlines.  His leadership throughout
the restructuring process positioned the Company well during an
extremely tumultuous period in the industry.  We're grateful that
Neal returned to the airline to help guide Northwest through the
restructuring process and we wish him the very best in his future
endeavors."

Discussing his departure, Mr. Cohen said, "Over the past three
years, we have worked collaboratively to reposition Northwest and
secure its future for the long-term.  Having successfully
completed the restructuring process, and with the impending
merger with Delta, I'm excited about the opportunity to pursue
business interests outside of the airline industry that I put on
hold when I returned to Northwest.  I'm confident that the
airline will continue to be an industry leader and am proud to
have been a part of its success."

Neal Cohen, 48, was executive vice president of finance and chief
financial officer for US Airways from April 2002 to April 2004.
Prior to US Airways, Cohen served as chief financial officer for
various service and financial organizations.  He spent nine years
with Northwest, from 1991 to 2000, where he held a number of
senior positions including senior vice president and treasurer.
Prior to joining Northwest, he spent seven years at General
Motors' Treasurers office in New York.

                    About Mesaba Aviation

Based in Eagan, Minnesota, Mesaba Aviation Inc., dba Mesaba
Airlines -- http://www.mesaba.com/-- operates as a Northwest  
Airlink affiliate under code-sharing agreements with Northwest
Airlines(OTC:NWACQ.PK).  The company filed for chapter 11
protection on Oct. 13, 2005 (Bankr. D. Minn. Case No. 05-39258).  
Michael L. Meyer, Esq., at Ravich Meyer Kirkman McGrath & Nauman
PA, represented the Debtor in its restructuring efforts.  Craig D.
Hansen, Esq., at Squire Sanders & Dempsey, L.L.P., represented the
Official Committee of Unsecured Creditors.  When the Debtor filed
for protection from its creditors, it listed total assets of
$108,540,000 and total debts of $87,000,000.  The U.S. Bankruptcy
Court for the District of Minnesota confirmed Mesaba's Modified
Plan of Reorganization on April 9, 2007.  Mesaba exited bankruptcy
on April 24, 2007, and was later acquired by Northwest Airlines
from MAIR Holdings Inc.  (Mesaba Bankruptcy News, Issue No. 54;
Bankruptcy Creditors' Service Inc.; http://bankrupt.com/newsstand/
or 215/945-7000)

                    About Northwest Airlines

Northwest Airlines Corp. (NYSE: NWA) -- http://www.nwa.com/--   
is the world's fourth largest airline with hubs at Detroit,
Minneapolis/St. Paul, Memphis, Tokyo and Amsterdam, and about
1,400 daily departures.  Northwest is a member of SkyTeam, an
airline alliance that offers customers one of the world's most
extensive global networks.  Northwest and its travel partners
serve more than 1000 cities in excess of 160 countries on six
continents.  Northwest and its travel partners serve more than
1000 cities in excess of 160 countries on six continents,
including Italy, Spain, Japan, China, Venezuela and Argentina.

The company and 12 affiliates filed for chapter 11 protection on
Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17930).  Bruce
R. Zirinsky, Esq., and Gregory M. Petrick, Esq., at Cadwalader,
Wickersham & Taft LLP in New York, and Mark C. Ellenberg, Esq.,
at Cadwalader, Wickersham & Taft LLP in Washington represent the
Debtors in their restructuring efforts.  The Official Committee
of Unsecured Creditors has retained Akin Gump Strauss Hauer &
Feld LLP as its bankruptcy counsel in the Debtors' chapter 11
cases.

When the Debtors filed for bankruptcy, they listed $14.4 billion
in total assets and $17.9 billion in total debts.  On Jan. 12,
2007 the Debtors filed with the Court their Chapter 11 Plan.  On
Feb. 15, 2007, they Debtors filed an Amended Plan & Disclosure
Statement.  The Court approved the adequacy of the Debtors'
Disclosure Statement on March 26, 2007.  On May 21, 2007, the
Court confirmed the Debtors' Plan.  The Plan took effect May 31,
2007.  (Northwest Airlines Bankruptcy News, Issue No. 92;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).   

                         *     *     *

As reported in the Troubled Company Reporter on April 17, 2008,
Moody's Investors Service placed the debt ratings of Delta Air
Lines, Inc. ("Delta", corporate family at B2) and Northwest
Airlines Corporation ("Northwest", corporate family rating at B1)
on review for possible downgrade.  The review was prompted by the
announcement that the two airlines have agreed to combine in an
all-stock transaction with a combined enterprise value of
approximately $18 billion.

Fitch Ratings has affirmed the debt ratings of Delta Air Lines,
Inc. following the announcement that Delta has agreed to merge
with Northwest Airlines Corp., subject to approval by the two
airlines' shareholders and the U.S. Department of Justice.  
Delta's ratings were affirmed as: Issuer Default Rating at 'B';
First-lien senior secured credit facilities at 'BB/RR1'; Second-
lien secured credit facility (Term Loan B) at 'B/RR4'.

The issue ratings apply to $2.5 billion of committed credit
facilities.  The Rating Outlook for Delta has been revised to
Negative from Stable.

Standard & Poor's Ratings Services placed its ratings, including
the 'B+' long-term corporate credit rating, on Northwest Airlines
Corp. on CreditWatch with negative implications, following
announcement of a merger agreement with Delta Air Lines Inc.
(B/Watch Pos/--).  The CreditWatch listing affects enhanced
equipment trust certificates with various ratings, excepting those
that are insured by a bond insurer.  S&P's listing of Northwest
ratings on CreditWatch with negative implications and those of
Delta on CreditWatch with positive implications implies that S&P
foresee a corporate credit rating of either 'B' or 'B+' for the
combined entity.


OMNI FINANCIAL: To Delay Filing Quarterly Report on Form 10-Q
-------------------------------------------------------------
Omni Financial Services, Inc. (NASDAQ: OFSI), the bank holding
company for Omni National Bank, said that it will delay filing its
Quarterly Report on Form 10-Q for the quarter ended March 31, 2008
because completion of the audit and financial statements for the
year ended December 31, 2007 is subject to resolution of issues
relating to certain valuation assertions in such financial
statements. The ultimate resolution of these issues will also
impact the financial results for the quarter ended March 31, 2008.

The primary issue relates to documentation supporting valuation
assertions of other real estate owned (OREO) held by the Company.
The OREO was acquired through foreclosure of properties that
collateralized loans in the Community Development Lending
Division. The Company is working with its independent registered
public accounting firm to resolve these issues but the timing of
the resolution is currently unknown. These valuation assertions
materially affect OREO and the provision for and the allowance for
loan and lease losses, which in turn impacts both earnings and
capital. Therefore, the Company cannot reliably quantify the
results of operations for 2007.

Although the Company cannot quantify the results of operations, it
expects to report a substantial loss for the year ended December
31, 2007. The loss relates to a significant increase in the
provision for loan and lease losses; a decrease in net interest
income resulting from an increase in non-performing loans;
expenses for adjustments to the carrying value of OREO in certain
markets; a $4.7 million goodwill impairment charge resulting from
the decline in the market value of the Company's stock as of
December 31, 2007; recognition of a $550,000 "other than
temporary" impairment of Federal Home Loan Mortgage preferred
investment securities; and a charge of $450,000 related to a
retirement agreement with a former executive officer.

The Company expects to report a loss for the quarter ended
March 31, 2008, as the number of non-performing loans and OREO
foreclosures in the Company's portfolio has continued to increase
due to the current liquidity crisis and tightening of the credit
and lending markets that commenced during the latter stages of
2007 and has continued to date in 2008. The increase in non-
performing assets has resulted in a reduction of interest income
and reversal of accrued interest on loans now classified as non-
performing loans.

                           About Omni

Omni Financial Services, Inc. -- http://www.onb.com/-- is a bank  
holding company headquartered in Atlanta, Georgia. Omni Financial
Services, Inc. provides a full range of banking and related
services through its wholly owned subsidiary, Omni National Bank,
a national bank headquartered in Atlanta, Georgia. Omni has one
full service banking location in Atlanta, one in Dalton, Georgia,
four in North Carolina, one in Chicago, Illinois, one in Dallas,
Texas, one in Houston, Texas and one in Tampa, Florida. In
addition, Omni has loan production offices in Charlotte, North
Carolina, Birmingham, Alabama, and Philadelphia, Pennsylvania.
Omni provides traditional lending and deposit gathering
capabilities, as well as a broad array of financial products and
services, including specialized services such as community
redevelopment lending, small business lending and equipment
leasing, warehouse lending, and asset-based lending. Omni
Financial Services, Inc.'s common stock is traded on the NASDAQ
Global Market under the ticker symbol "OFSI."


PACIFIC LUMBER: Scopac Objects to Marathon/Mendocino, BoNY Plans
----------------------------------------------------------------
"Scotia Pacific Company, LLC, as debtor-in-possession, is the only
party bound by a fiduciary duty to obtain an objective assessment
of its estate's value," Aaron G. York, Esq., at Gibson, Dunn &
Crutcher LLP, in  Dallas, Texas, told the Hon. Richard Schmidt  of
the U.S. Bankruptcy Court for the Southern District of Texas.  
Thus, under that mandate, Scopac obtained independent expertise
and presented highly credible evidence that its assets are
sufficiently valuable to pay all the Scopac creditors in full, and
even make a return to equity, Mr. York related.

In connection with this, Mr. York told the Court that evidence
of value remains relevant to the analysis of how the Plans of
Reorganization proposed by The Bank of New York Trust Company,
N.A., as Indenture Trustee for the Timber Notes on one side, and
Marathon Structured Finance Fund L.P. and Mendocino Redwood
Company, LLC on the other, treat Scopac's estate.

The valuation evidence demonstrates that whereas Scopac based its
full payment plan on its experts' value opinions, the proponents
of the Marathon/Mendocino Plan and the BoNY Plan based their
valuations on a desired outcome, Mr. York pointed out.  He noted
that the Marathon/Mendocino Plan proves the point most
dramatically, because it bases its attempt to cash out the
Noteholders for approximately 60 cents on the dollar on a
carefully crafted valuation that is approximately half that of
Scopac's independent experts.

The Noteholders themselves have been inconsistent as to value, Mr.
York contended.  Eight months ago, before the proponents of the
Marathon/Mendocino Plan threatened to cash out the Noteholders,
the Noteholders' valuation was significantly lower.  Now, the
Noteholders have changed experts and have a new, much
higher valuation, but not high enough to provide value to any
constituency other than the Noteholders, but sufficiently in
excess of the Marathon/Mendocino Plan proponents' valuation to
argue against a judicially-determined cash out, Mr. York said.

"The bottom line is that valuation is crucial to resolving the
Scopac case, and that a mechanism must be found within the
confines of the Bankruptcy Code to deal with this issue in the
context of a confirmable plan," Mr. York told Judge Schmidt.

         Scopac's Objections to Marathon/Mendocino Plan

Scopac argues that the Marathon/Mendocino Plan discriminates
unfairly, is not fair and equitable to dissenting classes, and is
unconfirmable as a matter of law.  Among other things, Mr. York
pointed out that the Marathon/Mendocino Plan:

   -- appears to wipe out Scopac's administrative priority claims
      against the estate of The Pacific Lumber Company.  These
      claims must be paid in cash in full on the effective date
      of the Marathon/Mendocino Plan in order for the it to be
      confirmed;

   -- discriminates unfairly against Class 9 Scopac General
      Unsecured Claims and Class 11 Non-Debtor Affiliate Claims
      by paying a materially lower recovery to them than it pays
      to another class with the same priority, Class 8 Scopac
      Trade Claims;

   -- is not fair and equitable with respect to Class 6 Scopac
      Timber Note Secured Claims because, although it effectively
      contemplates a sale of Scopac's assets to Newco, it does
      not permit the Noteholders to credit bid any amount;

   -- is not fair and equitable to Class 6 because it strips the
      Noteholders' liens and cashes them out at what the
      Marathon/Mendocino Plan Proponents hope will be a
      judicially-determined depressed value, thereby depriving
      the Noteholders of the benefit of their bargain; and

   -- violates Sections 1129(a)(I), 1123(b), 363(b) and
      1129(a)(3) of the Bankruptcy Code because it constitutes a
      forced sale of the Debtors' assets to Newco and Townco,
      which will be 100% owned by Mendocino or Marathon, without
      subjecting the assets to any market valuation process and
      for far less than fair and reasonable value.

"The only way to resolve the valuation issue in the context of a
confirmable plan is by a true market test, through an auction in
which credit bidding is conditioned to avoid chilling the bidding
process while still protecting the Noteholders' position," Mr.
York explained.  

              Court Should Limit BoNY's Credit Bid

The BoNY Plan proposes to auction the Scopac timberlands.  The
essential problem, however, is that BoNY has retained the
apparently unfettered right to credit bid under the BoNY Plan, Mr.
York pointed out.  "This will chill competitive bidding, as Mr.
Cherner, the Vice President of Scotia Redwood Foundation, himself
testified," he says.

Although Mr. Cherner and BoNY tried to assure the Court that the
Noteholders intend to have a competitive auction, the Court need
not -- and should not -- take them at their word, Mr. York
asserted.  

Instead, the Court should use its power under Section 363(k) of
the Bankruptcy Code to cap BoNY's right to credit bid
at $603 million, Scopac urges.  Furthermore, Scopac adds, the
Court should specify that BoNY's bid must include sufficient cash
to pay Administrative Claims, Priority Claims and to fund a $1.45
million distribution to General Unsecured Creditors under the
BoNY Plan, in the event that BoNY submits a credit bid.

Failure to limit BoNY's credit bid will create a sale
environment that will generate less than fair and reasonable
value for Scopac's assets, Mr. York told Judge Schmidt.

Against this backdrop, Scopac asks the Court to:

   (1) decline confirmation of the Marathon/Mendocino Plan;

   (2) cap BoNY's ability to credit bid at $603 million; and

   (3) specify that BoNY's bid, like all other bidders,
       must include sufficient cash to pay Administrative
       Claims, Priority Claims and to fund a $1.45 million
       distribution to General Unsecured Creditors.

                     About Pacific Lumber

Based in Oakland, California, The Pacific Lumber Company --
http://www.palco.com/-- and its subsidiaries operate in several
principal areas of the forest products industry, including the
growing and harvesting of redwood and Douglas-fir timber, the
milling of logs into lumber and the manufacture of lumber into a
variety of finished products.

Scotia Pacific Company LLC, Scotia Development LLC, Britt Lumber
Co., Inc., Salmon Creek LLC and Scotia Inn Inc. are wholly owned
subsidiaries of Pacific Lumber.

Scotia Pacific, Pacific Lumber's largest operating subsidiary, was
established in 1993, in conjunction with a securitization
transaction pursuant to which the vast majority of Pacific
Lumber's timberlands were transferred to Scotia Pacific, and
Scotia Pacific issued Timber Collateralized Notes secured by
substantially all of Scotia Pacific's assets, including the
timberlands.

Pacific Lumber, Scotia Pacific, and four other subsidiaries filed
for chapter 11 protection on Jan. 18, 2007 (Bankr. S.D. Tex. Case
Nos. 07-20027 through 07-20032).  Jack L. Kinzie, Esq., at Baker
Botts LLP, is Pacific Lumber's lead counsel.  Nathaniel Peter
Holzer, Esq., Harlin C. Womble, Jr., Esq., and Shelby A. Jordan,
Esq., at Jordan Hyden Womble Culbreth & Holzer PC, is Pacific
Lumber's co-counsel.  Kathryn A. Coleman, Esq., and Eric J.
Fromme, Esq., at Gibson, Dunn & Crutcher LLP, acts as Scotia
Pacific's lead counsel.   Kyung S. Lee, Esq., Esq., at Diamond
McCarthy LLP is Scotia Pacific's co-counsel, replacing Porter &
Hedges LLP.  John D. Fiero, Esq., at Pachulski Stang Ziehl & Jones
LLP, represents the Official Committee of Unsecured Creditors.

When Pacific Lumber filed for protection from its creditors, it
listed estimated assets and debts of more than $100 million.
Scotia Pacific listed total assets of $932,000,000 and total debts
of $765,978,335.

The Debtors filed their Joint Plan of Reorganization on Sept. 30,
2007, which was amended on Dec. 20, 2007.  Four other parties-in-
interest have filed competing plans for the Debtors -- The Bank of
New York Trust Company, N.A., as Indenture Trustee for the Timber
Notes; the Official Committee of Unsecured Creditors; Marathon
Structured Finance Fund L.P, the Debtors' DIP Lender and Agent
under the DIP Credit Facility; and the Heartlands Commission,
which represents the tribal members of the Bear River Band of
Rohnerville Rancheria and PALCO employees.

The Debtors' exclusive plan filing period expired on Feb. 29,
2008.  (Scotia/Pacific Lumber Bankruptcy News;
http://bankrupt.com/newsstand/or 215/945-7000).  


PACIFIC LUMBER: Lehman Offers $10-Mil. Loan for Scopac, BoNY Says
-----------------------------------------------------------------
The Bank of New York Trust Company, N.A., as Indenture Trustee
for the Timber Notes, notified the Court on May 12, 2008, that
Lehman Commercial Paper Inc. has made an offer to extend up to
$10 million in financing to the Plan Agent to fund Scotia Pacific
Company LLC's operations and administrative costs during the
post-confirmation, pre-sale period as contemplated in BoNY's
Modified First Amended Plan of Reorganization.

BoNY has elected former California Governor Pete Wilson to serve
as Plan Agent.

Representing BoNY, Zack A. Clement, Esq., at Fulbright &
Jaworski LLP, in Houston, Texas, states that although the
evidence adduced at the confirmation hearing on the Debtors'
Chapter 11 cases demonstrated (i) that Scopac has sufficient cash
to operate during the post-confirmation, pre-sale period, and
(ii) that the Plan Agent has the power to borrow additional funds
to the extent necessary, BoNY filed the Notice to add additional
certainty to the Plan Agent's ability to obtain the "gap period"
loan.

The Lehman DIP Loan provides additional proof of the feasibility
of the BoNY Plan, which will expose Scopac's assets to the market
and will result in the highest and best return to the Scopac
estate and its creditors, Mr. Clement states.

A full-text copy of the Lehman Term Sheet is available for free
at http://bankrupt.com/misc/PALCO_LehmanTermSheet.pdf

                     About Pacific Lumber

Based in Oakland, California, The Pacific Lumber Company --
http://www.palco.com/-- and its subsidiaries operate in several
principal areas of the forest products industry, including the
growing and harvesting of redwood and Douglas-fir timber, the
milling of logs into lumber and the manufacture of lumber into a
variety of finished products.

Scotia Pacific Company LLC, Scotia Development LLC, Britt Lumber
Co., Inc., Salmon Creek LLC and Scotia Inn Inc. are wholly owned
subsidiaries of Pacific Lumber.

Scotia Pacific, Pacific Lumber's largest operating subsidiary, was
established in 1993, in conjunction with a securitization
transaction pursuant to which the vast majority of Pacific
Lumber's timberlands were transferred to Scotia Pacific, and
Scotia Pacific issued Timber Collateralized Notes secured by
substantially all of Scotia Pacific's assets, including the
timberlands.

Pacific Lumber, Scotia Pacific, and four other subsidiaries filed
for chapter 11 protection on Jan. 18, 2007 (Bankr. S.D. Tex. Case
Nos. 07-20027 through 07-20032).  Jack L. Kinzie, Esq., at Baker
Botts LLP, is Pacific Lumber's lead counsel.  Nathaniel Peter
Holzer, Esq., Harlin C. Womble, Jr., Esq., and Shelby A. Jordan,
Esq., at Jordan Hyden Womble Culbreth & Holzer PC, is Pacific
Lumber's co-counsel.  Kathryn A. Coleman, Esq., and Eric J.
Fromme, Esq., at Gibson, Dunn & Crutcher LLP, acts as Scotia
Pacific's lead counsel.   Kyung S. Lee, Esq., Esq., at Diamond
McCarthy LLP is Scotia Pacific's co-counsel, replacing Porter &
Hedges LLP.  John D. Fiero, Esq., at Pachulski Stang Ziehl & Jones
LLP, represents the Official Committee of Unsecured Creditors.

When Pacific Lumber filed for protection from its creditors, it
listed estimated assets and debts of more than $100 million.
Scotia Pacific listed total assets of $932,000,000 and total debts
of $765,978,335.

The Debtors filed their Joint Plan of Reorganization on Sept. 30,
2007, which was amended on Dec. 20, 2007.  Four other parties-in-
interest have filed competing plans for the Debtors -- The Bank of
New York Trust Company, N.A., as Indenture Trustee for the Timber
Notes; the Official Committee of Unsecured Creditors; Marathon
Structured Finance Fund L.P, the Debtors' DIP Lender and Agent
under the DIP Credit Facility; and the Heartlands Commission,
which represents the tribal members of the Bear River Band of
Rohnerville Rancheria and PALCO employees.

The Debtors' exclusive plan filing period expired on Feb. 29,
2008.  (Scotia/Pacific Lumber Bankruptcy News;
http://bankrupt.com/newsstand/or 215/945-7000).  


PACIFIC LUMBER: Sierra Pacific Willing to Buy Mills, BoNY Says
--------------------------------------------------------------
The Bank of New York Trust Company, N.A., as Indenture Trustee
for the Timber Notes, notified the Court on May 12, 2008, that
Sierra Pacific Industries has made an offer to the Pacific Lumber
Company as "Chapter 11 debtor-in-possession, or a trustee
appointed under either Chapter 11 or Chapter 7" to buy the PALCO
mill, the related cogeneration plant, and related working capital
for roughly $45 million.

Representing BoNY, Zack A. Clement, Esq., at Fulbright &
Jaworski LLP, in Houston, Texas, relates that in a term sheet
outlining the purchase proposal, Sierra Pacific commits to make
major capital expenditures to enhance the performance of the
existing Scotia Mill and to construct and reconstruct the
facility so that it will:

   (a) feature separate small log and large log mills designed to
       cut redwood, Douglas fir, and whitewoods;

   (b) be capable of handling larger logs; and

   (c) by drawing logs from the entire region in addition to  
       logs from Scotia Pacific Company LLC, be capable of
       producing more output volume of lumber, thereby creating
       numerous additional jobs in the town of Scotia.

Marathon Structured Finance Fund L.P's security interest in the
town of Scotia, which was proposed to be abandoned to Marathon
under the Marathon/Mendocino Plan, will be enhanced in value by
the increased mill operations and employment in Scotia that will
result from the consummation of the transactions contemplated by
the Sierra Pacific Term Sheet, Mr. Clement avers.

A full-text copy of the Sierra Pacific Term Sheet is available
for free at:

   http://bankrupt.com/misc/PALCO_SierraPacificTermSheet.pdf

                     About Pacific Lumber

Based in Oakland, California, The Pacific Lumber Company --
http://www.palco.com/-- and its subsidiaries operate in several
principal areas of the forest products industry, including the
growing and harvesting of redwood and Douglas-fir timber, the
milling of logs into lumber and the manufacture of lumber into a
variety of finished products.

Scotia Pacific Company LLC, Scotia Development LLC, Britt Lumber
Co., Inc., Salmon Creek LLC and Scotia Inn Inc. are wholly owned
subsidiaries of Pacific Lumber.

Scotia Pacific, Pacific Lumber's largest operating subsidiary, was
established in 1993, in conjunction with a securitization
transaction pursuant to which the vast majority of Pacific
Lumber's timberlands were transferred to Scotia Pacific, and
Scotia Pacific issued Timber Collateralized Notes secured by
substantially all of Scotia Pacific's assets, including the
timberlands.

Pacific Lumber, Scotia Pacific, and four other subsidiaries filed
for chapter 11 protection on Jan. 18, 2007 (Bankr. S.D. Tex. Case
Nos. 07-20027 through 07-20032).  Jack L. Kinzie, Esq., at Baker
Botts LLP, is Pacific Lumber's lead counsel.  Nathaniel Peter
Holzer, Esq., Harlin C. Womble, Jr., Esq., and Shelby A. Jordan,
Esq., at Jordan Hyden Womble Culbreth & Holzer PC, is Pacific
Lumber's co-counsel.  Kathryn A. Coleman, Esq., and Eric J.
Fromme, Esq., at Gibson, Dunn & Crutcher LLP, acts as Scotia
Pacific's lead counsel.   Kyung S. Lee, Esq., Esq., at Diamond
McCarthy LLP is Scotia Pacific's co-counsel, replacing Porter &
Hedges LLP.  John D. Fiero, Esq., at Pachulski Stang Ziehl & Jones
LLP, represents the Official Committee of Unsecured Creditors.

When Pacific Lumber filed for protection from its creditors, it
listed estimated assets and debts of more than $100 million.
Scotia Pacific listed total assets of $932,000,000 and total debts
of $765,978,335.

The Debtors filed their Joint Plan of Reorganization on Sept. 30,
2007, which was amended on Dec. 20, 2007.  Four other parties-in-
interest have filed competing plans for the Debtors -- The Bank of
New York Trust Company, N.A., as Indenture Trustee for the Timber
Notes; the Official Committee of Unsecured Creditors; Marathon
Structured Finance Fund L.P, the Debtors' DIP Lender and Agent
under the DIP Credit Facility; and the Heartlands Commission,
which represents the tribal members of the Bear River Band of
Rohnerville Rancheria and PALCO employees.

The Debtors' exclusive plan filing period expired on Feb. 29,
2008.  (Scotia/Pacific Lumber Bankruptcy News;
http://bankrupt.com/newsstand/or 215/945-7000).  


PARMALAT SPA: 1st Qtr Profit Down on Lesser Legal Settlements
-------------------------------------------------------------
Parmalat S.p.A. said its net profit fell to EUR90,200,000, or
$140,000,000, in the first quarter of 2008 from a restated
EUR110,300,000, a year earlier.  

The figure missed the EUR103,900,000 median estimate of three
analysts surveyed by Bloomberg News.

Parmalat attributed its first quarter profit decline to lesser
collections from legal settlements, as well as higher milk costs.  

The settlements with the banks and auditors, in connection with
its bankruptcy, dropped by about a third from a year earlier,  
Sara Gay Forden of Bloomberg News notes.  

"The first quarter is typically weak, but the first few months of
this year were particularly weak due to the increase in the cost
of raw materials," Enrico Bondi, Parmalat's chief executive
officer, said in a conference call, according to the report.

Parmalat executives plan to spend more on marketing and product
innovation, in order to reach the low end of the range forecast.  
Citing turbulent market conditions, they said they expect the
company's EBITDA to increase 7 percent this year, to
EUR390,000,000.  Parmalat also cited "strong competitive
pressure" from retailers who are pushing their house brands and
currency fluctuations.

Parmalat shares held a closing price of EUR1.9225 on May 14 at
the Milan Online Stock Market.  As of March 28, 2008, about
1,667,496,728 shares of Parmalat were issued and outstanding.

Shareholders of Parmalat who hold more than 2% of ordinary
capital as of February 29 are:

                                          No. of Shares   Stake
                                          -------------   -----
    JP Morgan Chase & Co. Corporation       49,997,275   3.010%
    Societe Generale Asset Mgt. UK Ltd      48,540,624   2.922%
    Capital Research and Management         46,641,900   2.808%
    Fir Tree, Inc.                          43,753,261   2.634%
    Intesa San Paolo Group                  40,274,358   2.424%
    Deutsche Bank AG                        33,924,745   2.042%
                                           -----------  -------
          Total                            263,132,163  15.840%

Parmalat's shares have slid 18 percent this year, cutting
Parmalat's market value to EUR3,640,000,000, Bloomberg notes.

                      About Parmalat

Headquartered in Milan, Italy, Parmalat S.p.A.
-- http://www.parmalat.net/-- sells nameplate milk products
that can be stored at room temperature for months.  It also has
about 40 brand product lines, which include yogurt, cheese,
butter, cakes and cookies, breads, pizza, snack foods and
vegetable sauces, soups and juices.

The company's U.S. operations filed for chapter 11 protection on
Feb. 24, 2004 (Bankr. S.D.N.Y. Case No. 04-11139).  Gary
Holtzer, Esq., and Marcia L. Goldstein, Esq., at Weil Gotshal &
Manges LLP, represent the Debtors.  When the U.S. Debtors filed
for bankruptcy protection, they reported more than
US$200 million in assets and debts.  The U.S. Debtors emerged
from bankruptcy on April 13, 2005.

Parmalat S.p.A. and its Italian affiliates filed separate
petitions for Extraordinary Administration before the Italian
Ministry of Productive Activities and the Civil and Criminal
District Court of the City of Parma, Italy on Dec. 24, 2003.
Dr. Enrico Bondi was appointed Extraordinary Commissioner in
each of the cases.

On June 22, 2004, Dr. Bondi filed a Sec. 304 Petition, Case No.
04-14268, in the United States Bankruptcy Court for the Southern
District of New York.

Three Cayman Islands-based special-purpose vehicles created by
Parmalat were placed under separate winding up petitions before
the Grand Court of the Cayman Islands in January 2004.  Gordon I.
MacRae and James Cleaver of Kroll (Cayman) Ltd. serve as
liquidators in the cases of Dairy Holdings Ltd., Parmalat Capital
Finance Ltd., and Food Holdings Ltd.  On Jan. 20, 2004, the
Liquidators filed Sec. 304 petitions, Case No. 04-10362, in the
United States Bankruptcy Court for the Southern District of New
York on behalf of Parmalat Finance, et al.  Gregory M. Petrick,
Esq., at Cadwalader, Wickersham & Taft LLP, and Richard I. Janvey,
Esq., at Janvey, Gordon, Herlands Randolph, represent the Finance
Companies in the Sec. 304 case.

The Honorable Robert D. Drain presides over the Parmalat Debtors'
U.S. cases.  On June 21, 2007, the U.S. Court granted Parmalat
permanent injunction.


PARMALAT SPA: Provides Updates on Legal Actions Against Citigroup
-----------------------------------------------------------------
Parmalat S.p.A. has said its actions against Citigroup Inc. are
underway.  In view of the ongoing proceedings, Parmalat believes
any comment to be inappropriate.

Parmalat SpA noted that Citigroup is currently involved in three
proceedings:

   (1) a committal to trial in Parma, Italy, for its alleged
       co-liability in the fraudulent bankruptcy at Parmalat;

   (2) another criminal proceeding in Milan, Italy, for alleged
       market rigging; and

   (3) in a further trial for damages before the New Jersey
       Court.

According to Nicola Palmieri, Esq., Parmalat legal counsel, the
trial against Citigroup at the Bergen County Superior Court in
New Jersey might last five or six weeks, Sara Gay Forden of
Bloomberg News reported.  The length of the trial will mean a
significant increase in legal costs, Mr. Palmieri had said
without elaborating.

No settlement talks are under way with Citigroup, Mr. Palmieri
told Bloomberg News, and lawsuits are progressing against Bank of
America Corp., Grant Thornton LLP, and Italian banks who were
Parmalat's former lenders.

Sources close to Citigroup also told Thomson Financial News
reports that the bank is not holding talks with Parmalat to settle
its U.S. civil case or with Italian investigators for plea-bargain
agreements.  According to Thomson Financial News, analysts have
speculated that Parmalat and Citigroup could reach a settlement
during a civil trial in New Jersey.

Citigroup is facing a US$2.2 billion in damages in New Jersey
and has counter-sued Parmalat for US$699 million.  Citigroup
executives, meanwhile, are facing criminal charges in Milan and
Parma, Italy.

The bank has been denying the charges.

Separately, Judge Eleonora Fiengo of a court in Parma, Italy,
denied a request by Parmalat founder Calisto Tanzi's lawyers to
unite all trials connected to the financial collapse of Parmalat
S.p.A., Colleen Barry writes for The Associated Press.

Giampiero Biancolella, counsel for Mr. Tanzi, argued that
combining the Parma trials will allow an efficient defense of
his client, noting that many strands in the cases overlap, AP
reports.

Judge Fiengo refused the request, ruling that keeping the trials
separate would hasten smaller cases without hindering the
defense, AP relates.

The judge however combined two of the trials -- the main trial
accusing Mr. Tanzi and 22 others of fraudulent bankruptcy will
now include the founder's former lawyer Michele Ributti, who is
charged of misappropriating Parmalat funds.

Judge Fiengo kept these trials separate:

    * relating to the failure of the Parmatour travel firm;

    * relating to Parmalat's purchase of mineral water-firm
      Ciappazzi; and

    * relating funds availed from Emilia Romagna Factoring.

The court will resume trials June 4, 2008, AP relates.  The
court will decide the same day whether to combine to the main
proceedings the trial relating to Parmalat's  acquisition of
Eurolat.

Paola Cagossi, a lawyer representing more than 1,000 Parmalat
investors, told AP that maintain several trials would give small
shareholders a better chance of winning damages.

                      About Parmalat

Headquartered in Milan, Italy, Parmalat S.p.A.
-- http://www.parmalat.net/-- sells nameplate milk products
that can be stored at room temperature for months.  It also has
about 40 brand product lines, which include yogurt, cheese,
butter, cakes and cookies, breads, pizza, snack foods and
vegetable sauces, soups and juices.

The company's U.S. operations filed for chapter 11 protection on
Feb. 24, 2004 (Bankr. S.D.N.Y. Case No. 04-11139).  Gary
Holtzer, Esq., and Marcia L. Goldstein, Esq., at Weil Gotshal &
Manges LLP, represent the Debtors.  When the U.S. Debtors filed
for bankruptcy protection, they reported more than
US$200 million in assets and debts.  The U.S. Debtors emerged
from bankruptcy on April 13, 2005.

Parmalat S.p.A. and its Italian affiliates filed separate
petitions for Extraordinary Administration before the Italian
Ministry of Productive Activities and the Civil and Criminal
District Court of the City of Parma, Italy on Dec. 24, 2003.
Dr. Enrico Bondi was appointed Extraordinary Commissioner in
each of the cases.

On June 22, 2004, Dr. Bondi filed a Sec. 304 Petition, Case No.
04-14268, in the United States Bankruptcy Court for the Southern
District of New York.

Three Cayman Islands-based special-purpose vehicles created by
Parmalat were placed under separate winding up petitions before
the Grand Court of the Cayman Islands in January 2004.  Gordon I.
MacRae and James Cleaver of Kroll (Cayman) Ltd. serve as
liquidators in the cases of Dairy Holdings Ltd., Parmalat Capital
Finance Ltd., and Food Holdings Ltd.  On Jan. 20, 2004, the
Liquidators filed Sec. 304 petitions, Case No. 04-10362, in the
United States Bankruptcy Court for the Southern District of New
York on behalf of Parmalat Finance, et al.  Gregory M. Petrick,
Esq., at Cadwalader, Wickersham & Taft LLP, and Richard I. Janvey,
Esq., at Janvey, Gordon, Herlands Randolph, represent the Finance
Companies in the Sec. 304 case.

The Honorable Robert D. Drain presides over the Parmalat Debtors'
U.S. cases.  On June 21, 2007, the U.S. Court granted Parmalat
permanent injunction.


PENAMISADE LTD: Case Summary & Four Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Penamisade, Ltd.
        dba North Star Crossing Shopping Center
        6905 Echo Canyon Drive
        McKinney, TX 75070

Bankruptcy Case No.: 08-41176

Chapter 11 Petition Date: May 5, 2008

Court: Eastern District of Texas (Sherman)

Debtor's Counsel: Michelle E. Shriro, Esq.
                  Email: mshriro@singerlevick.com
                  Singer & Levick, P.C.
                  16200 Addison Rd., Ste. 140
                  Addison, TX 75001
                  Tel: (972) 380-5533
                  Fax: (972) 380-5748

Estimated Assets: $1 million to $10 million

Estimated Debts:  $1 million to $10 million

Debtor's Four Largest Unsecured Creditors:

   Entity                      Claim Amount
   ------                      ------------
Action Services                Unknown
P.O. Box 850
Rockwall, TX 75087-0850

City of Garland                Unknown
P.O. Box 461508
Garland, TX 75046-1508

Garland Heating & Air          Unknown
Conditioning Co.
2113 South Garland Rd.
Garland, TX 75040

TXU Energy                     Unknown


PHLA INC: Case Summary & Five Largest Unsecured Creditors
---------------------------------------------------------
Debtor: PHLA, Inc.
        dba Lakeway Quick Lube and Oil
        1103 RR 620 S.
        Austin, TX 78734

Bankruptcy Case No.: 08-10841

Chapter 11 Petition Date: May 5, 2008

Court: Western District of Texas (Austin)

Judge: Craig A. Gargotta

Debtor's Counsel: Stephen W. Sather, Esq.
                  Email: ssather@bnpclaw.com
                  Barron & Newburger, P.C.
                  1212 Guadalupe, Ste. 104
                  Austin, TX 78701
                  Tel: (512) 476-9103, 220 (ext.)
                  Fax: (512) 476-9253
                  http://www.bnpclaw.com/

Estimated Assets: $1 million to $10 million

Estimated Debts:     $500,000 to $1 million

Debtor's Five Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
Jolink, Gray                   Attorney Fees         $11,158
4131 Spicewood Springs, #C-8
Austin, TX 78759

Ward, Donna                    Loan                  $10,000
9120 CR 1405
Athens, TX 75751

Citi Bank                      Credit Card           $7,299
701 E. 60th St. N.
Sioux Falls, SD 57117

Discover                       Credit Card           $3,500

Byrd, Jim                      Judgment              $985


PILGRIM'S PRIDE: Equity Issuance Won't Affect Moody's Ratings
-------------------------------------------------------------
Moody's Investors Service stated that Pilgrim's Pride
Corporation's recent common equity issuance, while positive for
the company's liquidity, has not at this point had an impact on
its ratings or on Moody's ongoing review of those ratings for
possible downgrade that began on April 16, 2008.

Pilgrim's Pride sold 7.5 million common shares for net proceeds of
approximately $177 million.  Net proceeds will be applied to debt
reduction and for general corporate purposes.  Should all net
proceeds be allocated to debt reduction, outstanding reported
debt, over $1.63 billion at March 29, 2008, would fall by less
than 11%.  However, a potential debt reduction of that magnitude
would improve the company's financial flexibility, especially if
applied to outstandings under Pilgrim's Pride's revolving credit
facilities.  

At May 2, 2008, prior to the equity issuance, the company had
unused availability of only $328.5 million under three revolving
commitments aggregating $902.1 million.  Ample committed
availability is especially crucial when margins are under
pressure, as they are now for Pilgrim's Pride.  For the second
fiscal quarter ended March 29, 2008, the company reported an
operating loss of $143.6 million, after restructuring charges of
approximately $5.7 million.  Feed grain costs in fiscal 2008, now
expected to be $800 million higher than in the prior year, are
unlikely to be fully offset by price increases and/or cost cuts,
in Moody's view.

Moody's notes that Pilgrim's Pride recently obtained an amendment
to its financial covenants through the end of fiscal 2009, another
positive action in terms of financial flexibility.

Headquartered in Pittsburg, Texas, Pilgrim's Pride Corporation is
the world's largest chicken company.  Sales for the twelve months
ended March 29, 2008 were approximately $8.47 billion.  The
company's corporate family rating is Ba3, and its ratings are
under review for possible downgrade.


PROTECTION ONE: POI Acquisition Declares 46.6% Equity Stake
-----------------------------------------------------------
POI Acquisition LLC discloses that it owns 11,803,887 shares in
Protection One Inc. common stock, representing 46.6% interest of
common stock outstanding.

In addition, Monarch Alternative Capital LP beneficially owns
5,901,942 shares of Protection One common stock.  The shares
represent 23.3% of the 25,306,913 shares of common stock
outstanding as of March 10, 2008.  Monarch Master Funding Ltd.
directly beneficially owns 5,333,333 shares of Protection One
common stock, which represent 21.1% of the outstanding shares of
common stock.

Headquartered in Lawrence, Kansas, Protection One Inc.
(NASDAQ:PONE) -- http://www.ProtectionOne.com/-- is a vertically   
integrated national providers of sales, installation, monitoring,
and maintenance of electronic security systems to homes and
businesses.  Network Multifamily, Protection One's wholly owned
subsidiary, is a security provider to the multifamily housing
market.  The company also owns the provider of wholesale
monitoring services, the combined operations of CMS and Criticom
International.


PROTECTION ONE: March 31 Balance Sheet Upside-Down by $45 Million
-----------------------------------------------------------------
Protection One Inc. reported on Monday its unaudited financial
results for the first quarter ended March 31, 2008 on Monday.  

At March 31, 2008, the company's consolidated balance sheet showed
$655.0 million in total assets and $700.2 million in total
liabilities, resulting in a $45.2 million total stockholders'
deficit.

Total revenue in the first quarter of 2008 increased by 33.3% to
$91.6 million, largely due to the company's merger with Integrated
Alarm Services Group Inc. (IASG) on April 2, 2007.  

As a result of the increased debt assumed in connection with the
merger and the fair valuation of customer and dealer accounts
acquired in the merger, interest expense and non-cash amortization
increased by 27.0% and 84.4%, respectively.  The retirement of the
company's Senior Subordinated Notes with the proceeds from the
$110.3 million unsecured term Loan on March 14th resulted in a
$12.8 million loss on retirement of debt.  The impact of these
items was largely responsible for the increase in the company's
net loss to $23.1 million, from $5.3 million in 2007.

The company's adjusted EBITDA in the first quarter of 2008
increased 32.4% to $26.8 million compared to $20.2 million in the
same period of 2007.  Total company recurring monthly revenue
(RMR) as of March 31, 2008, was $26.6 million, up from
$20.1 million as of March 31, 2007, due to contributions from the
merger.

Richard Ginsburg, Protection One's president and chief executive
officer, commented, "Operationally, we accomplished a great deal
in the first quarter.  As a result of significant efforts, we have
largely completed our program to address the cellular industry's
movement to digital technology.  In addition, our Retail segment
delivered another quarter of exceptional growth in RMR additions,
notwithstanding the generally uncertain economic conditions.  

"Retail additions increased 12.7% compared to additions in the
first quarter of 2007 of which commercial additions, our principal
area of focus, increased 26.0% with a slight benefit from the
merger.  Our Multifamily segment also contributed additions
growth, and our Wholesale business' RMR at the end of the quarter
was up 3.5% from year end."

Ginsburg continued, "In the middle of the first quarter, we
launched a new marketing program, from which we expect to see
benefits in the current quarter and going forward.  Of the
national monitoring providers, we were first to market with an
interactive service under the e-SecureSM product name, and we
expect our enhanced targeting and service bundles based on e-
Secure to deliver improved residential and commercial average
revenue per unit.  Finally, we continued our efforts to build our
national accounts program, capitalizing on our national footprint
and expertise in this area."

Ginsburg closed, "With respect to cancels, we are seeing
indications that attrition in the IASG portfolio has stabilized
and expect a decrease in the second quarter.  We will continue to
focus on reducing attrition and operating costs in order to drive
improvement in adjusted EBITDA.  We were also very pleased to have
been the only monitored security provider recently named by
Forbes.com as one of "America's Most Trustworthy Companies," and
we will strive to continually operate in a manner to be deserving
of such recognition, demonstrating a strong commitment to
integrity and service throughout our organization."

                             Net Debt

The company's cash and equivalents as of March 31, 2008, were
$33.5 million compared to $41.0 million at Dec. 31, 2007, with the
decrease primarily due to cash payments in connection with the
redemption of the Senior Subordinated Notes.

The company's total debt and capital leases, excluding debt
discounts and premiums, as of March 31, 2008, was $525.1 million,
compared to $526.0 million as of Dec. 31, 2007.  The company
borrowed approximately $110.3 million under the new Unsecured Term
Loan facility to redeem all of the Senior Subordinated Notes.  A
loss of $12.8 million was recorded in connection with the
retirement of the Senior Subordinated Notes, which consisted of
the write-off of unamortized discount, a make-whole payment, and
termination fees.

The company recently entered into interest rate swaps on
$150.0 million and $100.0 million tranches of its Senior Secured
Term loan fixing LIBOR at 3.19% and 3.15%, respectively, for
approximately 30 months.  With the execution of these hedges,
$365.3 million, or approximately 70%, of the company's debt
carries a fixed interest rate.  At current LIBOR, the company's
annualized cash interest expense is approximately $48.0 million.

Net debt as of March 31, 2008, was $491.6 million compared to
$485.0 million at Dec. 31, 2007.  While not included in net debt,
the company also has notes receivable due from its Wholesale
dealers of approximately $5.7 million as of March 31, 2008.

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?2bf8

                       About Protection One

Headquartered in Lawrence, Kan., Protection One Inc. (Nasdaq:
PONE) -- http://www.ProtectionOne.com/-- is a vertically  
integrated national provider of sales, installation, monitoring,
and maintenance of electronic security systems to homes and
businesses.  Network Multifamily, Protection One's wholly owned
subsidiary, is the largest security provider to the multifamily
housing market.  The company also owns the nation's largest
provider of wholesale monitoring services, the combined operations
of CMS and Criticom International.


QIS INC: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------
Debtor: Q.I.S., Inc.
        aka Quality Industrial Services, Inc.
        27481 Beverly Rd.
        Romulus, MI 48174

Bankruptcy Case No.: 08-50993

Type of Business: The Debtor provides inspection, sorting, rework,
                  warehousing, transportation, Level 1 & 2
                  containment assistance, kitting, packaging,
                  sequencing and light assembly.  See
                  http://www.qis9002.com/

Chapter 11 Petition Date: May 5, 2008

Court: Eastern District of Michigan (Detroit)

Judge: Walter Shapero

Debtor's Counsel: Jayson Ruff, Esq.
                  Email: jruff@mcdonaldhopkins.com
                  Thomas K. Lindahl, Esq.
                  Email: tlindahl@mcdonaldhopkins.com
                  39533 Woodward Ave., Ste. 318
                  Bloomfield Hills, MI 48304
                  Tel: (248) 646-5070

Estimated Assets: $1 million to $10 million

Estimated Debts:  $1 million to $10 million

Debtor's 20 Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
Kotz, Sangster, Wysocki & Berg professional services $232,179
400 Renaissance Ctr.,
Ste. 3400
Detroit, MI 48243-1602

Job 1 USA                      trade                 $200,667
A/R Dept.
P.O. Box 635417
Cincinnati, OH 45263-5417

Ohio Commerce Center           trade                 $126,769
SDS 12-2113 P.O. Box 86
Minneapolis, MN 55486-2113

Mancan, Inc.                   trade                 $87,775

Qualified Staffing             trade                 $84,067

Ambassador Personnel           trade                 $82,695

McNish Group                   professional services $55,643

Arcadia                        trade                 $48,000

Centerpoint Properties         trade                 $44,903

Ben Muller Reality             trade                 $38,458

Dominion East Ohio                                   $36,724

Verizon                        trade                 $34,295

Qwest                          trade                 $33,573

Express Services, Inc.         trade                 $32,873

(Verizon) Goodman Factors,     trade                 $32,557

The Callos Cos.                trade                 $32,210

Forge                          trade                 $29,561

Innovative Computer Systems    trade                 $24,207

Global Office Solutions        trade                 $24,122

StaffStore Enterprises, Inc.   trade                 $22,019


RAAC SERIES: S&P Lowers Ratings on Three Certificate Classes
------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on three
classes of mortgage asset-backed pass-through certificates from
RAAC Series 2006-SP1 Trust.  At the same time, S&P affirmed its
ratings on the remaining five classes from this transaction.
     
As of the April 2008 remittance period, total delinquencies were
40.98% of the current pool balance, up from 16.61% one year ago,
while severe delinquencies were 33.78%, up from 11.32% a year ago.  
Cumulative realized losses to date are 2.82% of the original pool
balance.
     
As highlighted by the delinquency and loss trends, the downgrades
reflect the adverse performance of the collateral pools.  Monthly
net losses continue to outpace monthly excess interest cash flows,
thereby compromising overcollateralization and resulting in
weakened credit support.  Specifically, monthly net losses have
exceeded excess interest in nine out of the 12 past months, or
approximately 75% of the time.  Moreover, as of the April 2008
remittance period, O/C was approximately $10,334,557, below its
target of $12,699,584, resulting in a deficiency of approximately
$2,365,026.
     
Despite the performance of the aforementioned classes, S&P's
analysis indicates that the remaining classes from this
transaction have adequate credit support.  As a result, the
affirmations reflect loss coverage percentages that S&P believe
are sufficient to maintain the current ratings.
     
The deal's outstanding pool factor is currently 51.72%, and the
deal is 25 months seasoned.  Subordination, O/C, and excess
interest cash flows provide credit support for this deal.  The
pool originally consisted of 30-year, fixed- and adjustable-rate
mortgage loans secured by first or second liens on one- to four-
family residential properties.


                         Ratings Lowered

                    RAAC Series 2006-SP1 Trust
          Mortgage asset-backed pass-through certificates

                                   Rating
                                   ------
                  Class      To              From
                  -----      --              ----
                  M-3        BB              A                
                  M-4        B               A-
                  M-5        B-              BBB+
      
                        Ratings Affirmed

                   RAAC Series 2006-SP1 Trust
          Mortgage asset-backed pass-through certificates
  
                     Class            Rating
                     -----            ------
                     A-1              AAA
                     A-2              AAA
                     A-3              AAA
                     M-1              AA+
                     M-2              AA-


RCS-CHANDLER: Section 341(a) Meeting Slated for May 27
------------------------------------------------------
The U.S. Trustee for Region 14 will convene a meeting of creditors
of RCS-Chandler LLC at 4:30 p.m., on May 27, 2008, at the U.S.
Trustee Meeting Room, 230 North First Avenue, Suite 102 in
Phoenix, Arizona.

This is the first meeting of creditors required under Section
341(a) of the Bankruptcy Code in all bankruptcy cases.

All creditors are invited, but not required, to attend.  This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible office of the
Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.

Phoenix, Arizona-based RCS-Chandler LLC sought protection under
chapter 11 on April 11, 2008 (Bankr. D. Ariz. Case No. 08-04021).  
Sarah Sharer Curley presides the case.  Michael R. Walker, Esq.,
at Schian Walker P.L.C.  When the Debtor filed for bankruptcy, it
listed assets and debts between $50 million and $100 million.


RECKSON OPERATING: Fitch Says Ties To SL Green Factor in Ratings
----------------------------------------------------------------
Reckson Operating Partnership, L.P.'s (ROP) ratings are based on
the consolidated profile of its parent, SL Green, according to the
latest credit analysis update by Fitch Ratings.

On a standalone basis, ROP has relatively low leverage and strong
coverage metrics and a largely unencumbered stabilized portfolio.
However, the absence of formal ring-fencing agreements between ROP
and SL Green and Fitch's view of SL Green's credit characteristics
are drivers behind Fitch's views of ROP.

On April 14, 2008, Fitch Ratings affirmed and removed ROP from
Rating Watch Negative. Fitch's latest credit analysis update on
ROP, which provides more detail supporting Fitch's ratings, is
available on the Fitch Ratings Web site at
http://www.fitchratings.com/

Fitch's currently rates ROP:

   -- IDR 'BB+';
   -- Senior unsecured notes 'BB+';
   -- Senior unsecured convertible notes 'BB+';
   -- Rating Outlook Stable.

Primary credit strengths include :

   -- ROP's diversified tenant base with no tenant contributing
      more than 7.3% of base rent;

   -- ROP's strong unencumbered asset and debt-service coverage
      of 2.9x and 2.5x, respectively;

   -- Manageable debt maturity schedule.

Primary credit concerns include the following:

   -- Reckson Operating Partnership is not a ring-fenced
      subsidiary;

   -- Considerable geographic concentration, with all of the
      assets located in the New York tri-state area, half of
      which are located within Manhattan.


RELIANT CHANNELVIEW: BoNY Balks at Further Use of Cash Collateral
-----------------------------------------------------------------
The Bank of New York told the The U.S. Bankruptcy Court for the
District of Delaware that it objects to the motion filed by
Reliant Energy Channelview L.P. and its debtor-affiliates seeking
an extension of a cash collateral order unless a short extension
is conditioned upon the lenders' receipt of appropriate adequate
protection.  BoNY is an administrative agent to the Debtors'
lenders under a credit agreement dated Dec. 15, 1999.

The Court entered on May 2, 2008, a second agreed order related to
the Debtors' request to use lenders' cash collateral.

The Court had allowed the Debtors to use cash collateral of not
less than $4 million until yesterday, May 15, 2008.

BoNY said that the lenders are, by significant margin, the largest
creditors of the Debtors with an aggregate outstanding principal
of about $342 million under the credit agreement.  The debt under
the credit agreement is secured by, among others, a lien on
substantially all of the Debtors' assets.

On Feb. 26, 2008, the Debtors filed a motion to approve the sale
of assets to Kelson Energy IV LLC for an estimated price of $468
million.  Following an auction on April 7, 2008, the Debtors
determined to instead sell the assets to GIM Cogeneration
Channelview LLC for $500 million, plus cash on hand at the time of
closing.  According to BoNY, both the sale transactions
contemplated a sale absent assumption and assignment of a second
amended and restated cash flow participation agreement for the
Channelview Plant Project, dated Dec. 15, 1999 between Channelview
and Equistar Chemicals LP.

On April 9, 2008, the Court held that the project could not be
excluded from the sale transaction.

A dispute between the Debtors, its parent company Reliant Energy
Inc. and Equistar was placed under mediation on May 12, 2008.

On May 2, the existing cash collateral order expired.  In order to
permit the Court time to order mediation, the lenders agreed to a
short extension so that the Debtors' cash collateral motion could
be heard Wednesday, May 14, 2008.  As of yesterday, the lenders'
agreement to permit the Debtors to use cash collateral expired.  

In addition, the appointment of a chapter 11 trustee is an event
of default under the existing cash collateral order and allows the
lenders to terminate the Debtors' use of cash collateral.

                 About Reliant Energy Channelview

Based in Houston, Reliant Energy Channelview L.P. --
http://www.reliant.com/-- owns a power plant located near     
Houston, and is an indirect wholly owned subsidiary of Reliant
Energy Inc.

The company and its three affiliates, Reliant Energy Channelview
(Texas) LLC, Reliant Energy Channelview (Delaware) LLC, and
Reliant Energy Services Channelview LLC filed for chapter 11
protection on Aug. 20, 2007 (Bankr. D. Del. Lead Case No.
07-11160).  Jason M. Madron, Esq., Lee E. Kaufman, Esq., Mark D.
Collins, Esq., Paul Noble Heath, Esq., Richards, Robert J. Stearn
Jr., Esq., at Layton & Finger P.A., and Timothy P. Cairns,
Pachulski Stang Ziehl & Jones represent the Debtors.  The U.S.
Trustee for Region 3 appointed an Official Committee of Unsecured
Creditors in the Debtors' cases. David B. Stratton, Esq., and
Evelyn J. Meltzer, Esq., at Pepper Hamiltion LLP, represent the
Committee.  When the Debtors filed for protection from their
creditors, they listed total assets of $362,000,000 and total
debts of $342,000,000.


RESIDENTIAL FUNDING: Moody's Cuts Rating on Cl. M-5 Loan to Ba2
---------------------------------------------------------------
Moody's Investors Service has downgraded the ratings of three
tranches issued in two transactions securitized by RFC.  The
underlying collateral consists of fixed-rate mortgage and
adjustable-rate mortgage loans acquired by Residential Funding
Corporation under their Home Solution Program.  The program was
established for first-lien mortgage loans with high loan-to-value
ratios of up to 107%.

The deals being reviewed have experienced increased severities
over time, which have increased losses through delinquent loan
liquidations.  Timing of losses coupled with the passing of
stepdown triggers for RAMP 2004-RZ3 have caused the protection
available to the subordinated bonds to be diminished.

Complete rating actions are:

Issuer: RAMP Series 2004-RZ1 Trust

  -- Cl. M-4, downgraded from Baa2 to Ba1
  -- Cl. M-5, downgraded from Baa3 to Ba2

Issuer: RAMP Series 2004-RZ3 Trust

  -- Cl. M-I-4, downgraded from Baa2 to Ba1


ROADHOUSE GRILL: To Liquidate, End Leases of Restaurants
--------------------------------------------------------
The Hon. Paul Hyman of the U.S. Bankruptcy Court in West Palm
Beach, Florida, converted the Chapter 11 bankruptcy cases of
Roadhouse Grill Inc. and R.H.G. Acquisition Corporation to Chapter
7 liquidation proceedings, Dawn McCarty of Bloomberg News reports.

According to Bloomberg, the Court allows the Debtors to liquidate
their assets because it could not sustain business operations when
it failed to obtain at least $1.3 million in financing from MCF
Development LLC to cure defaults on the remaining leased stores.

The Debtors say in court filings they decided to end the leases of
their 20 remaining restaurant locations, Mrs. McCarty relates.

                      About Roadhouse Grill

Headquartered in Palm Beach, Florida, Roadhouse Grill, Inc. --
http://www.roadhousegrill.com/-- owned 57 restaurants and
franchised 12 branches to five other companies.  The company and
its affiliate, R.H.G. Acquisition Corp., filed for chapter 11
protection on Oct. 8, 2007 (Bankr. S.D. Fla. Case Nos. 07-18410
and 07-18414).  Paul J. Battista, Esq., at Kelley & Fulton P.A.,
represents the Debtors.  The U.S. Trustee for Region 21 appointed
nine creditors to serve on an Official Committee of Unsecured
Creditors.  Paul J. Battista, Esq., at Genovese, Joblove and
Battista, P.A., represents the Committee in these cases.  

According to the Debtors' schedules, it listed total assets of
$5,209,124 and total liabilities of $21,671,484.


RUTLAND: Fitch Puts Class B3-LEK Notes' BB Rating on Neg. Watch
---------------------------------------------------------------
Fitch Ratings has placed these classes of Rutland Rated
Investments Sedona 2005-1 (Sedona 2005-1) notes on Rating Watch
Negative:

   -- USD20,000,000 class A-3F secured limited recourse
      fixed-rate credit linked notes due 2010, rated 'BBB',
      Rating Watch Negative.

   -- USD2,000,000 class A3-LK secured limited recourse
      floating-rate credit linked notes due 2010, rated 'BBB',
      Rating Watch Negative.

   -- USD60,000,000 class B3-LEK secured limited recourse
      floating-rate credit linked notes due 2010, rated 'BB',
      Rating Watch Negative.

The Rating Watch Negative placements reflect Fitch's view on the
credit risk of the rated notes following the release of its new
Corporate CDO rating criteria.

Key drivers of this transaction's credit risk include:

   -- Portfolio credit risk deteriorating to an average portfolio
      quality of 'BBB-' compared to 'BBB'/'BBB-' in June 2007,
      with 23.0% of the portfolio rated below investment grade.

   -- Portfolio migration risk with 14.0% of the portfolio on
      Rating Watch Negative and 18.0% of the portfolio with a
      Negative Outlook.

   -- Industry concentration of 42.0% in the three largest, made
      up of 25.0% in banking & finance, 9.0% in retail (general)
      and 8.0% in telecommunications.

Given Fitch's view of concentration and the current credit quality
of the portfolio, the credit enhancement levels of 3.1% for
classes A-3F and A3-LK, and 2.4% for class B3-LEK are not
sufficient to justify the current ratings of these notes.

Resolution of the Negative Watch status will incorporate any
changes made to the portfolio or the transaction along with
additional portfolio migration. If there are no significant
changes prior to the resolution of the Watch status, classes
A3-F, A3-LK and B3-LEK will likely be downgraded to the 'B'
category or lower.

Sedona 2005-1 is a synthetic collateralized debt obligation (CDO)
referencing a static portfolio of primarily investment grade
corporate obligations. At close, proceeds from the issuance of the
notes were used to collateralize credit default swaps (CDS)
between the issuer and Bear Stearns Credit Products Inc., the CDS
counterparty (guaranteed by Bear Stearns Companies, rated 'F2/A-',
Rating Watch Positive) and further guaranteed by JPMorgan Chase &
Co., rated 'F1+/AA-' by Fitch.


SANDRIDGE ENERGY: Prices $750 Million Offering of 8% Senior Notes
-----------------------------------------------------------------
SandRidge Energy Inc. priced its private placement offering of
$750 million of 8% Senior Notes due June 1, 2018.

Proceeds of the offering, which is expected to settle and close on
May 20, 2008, subject to customary closing conditions, are will be
used to repay the outstanding borrowings under its senior
revolving credit facility and to fund its capital expenditure
program focused on the West Texas Overthrust.

The company plans to offer and issue the notes only to qualified
institutional buyers pursuant to Rule 144A under the Securities
Act and to persons outside the United States pursuant to
Regulation S.

Oklahoma City-based SandRidge SandRidge Energy Inc. (NYSE: SD) --
http://www.sandridgeenergy.com/-- is an independent natural gas  
and oil company with its principal focus on exploration,
development and production activities.  The company also owns and
operates drilling rigs and a related oil field services company
operating under the name Lariat Services Inc.; gas gathering,
marketing and processing facilities, and, through its wholly owned
subsidiary PetroSource Energy Company, carbon dioxide treating and
transportation facilities and tertiary oil recovery operations.
The company is focused on exploration and exploitation of its
significant holdings in West Texas that it refers to as the West
Texas Overthrust, a natural gas prone geological region that
includes the Pinon Field, and its South Sabino and Big Canyon.  

                           *     *     *

As reported in the Troubled Company Reporter on May 14, 2008,
Standard & Poor's Ratings Services assigned its 'B-' rating to
SandRidge Energy Inc.'s (B/Positive/--) proposed $500 million in
senior unsecured notes, with a recovery rating of '5', indicating
S&P's expectation of modest (10%-30%) recovery in the event of a
payment default.  At the same time, S&P affirmed SandRidge's 'B'
corporate credit rating and lowered the issue rating on the
company's $1 billion in existing senior unsecured notes to 'B-'
from 'B' and revised the recovery rating to '5' from '3'.


SANDRIDGE ENERGY: Moody's Rates Pending $750MM Note B3
------------------------------------------------------
Moody's assigned a B3 rating to SandRidge Energy, Inc.'s pending
$750 million senior unsecured note offering.  Moody's affirmed
SD's B2 corporate family rating, B2 probability of default rating,
and B3 senior unsecured rating but changed the point estimate from
LGD4-63% to LGD5-70%.  The rating outlook remains stable.  The
change in the LGD point estimate reflects both the growth in
expected senior secured bank revolver debt in the capital
structure and a larger borrowing base amount, expected to be
$1.050 billion after the note offering.  The prior $700 million
borrowing base had been increased to $1.2 billion in April 2008
and will be reduced to $1.050 billion with the note offering.

Note proceeds will be used to repay approximately $420 million
currently outstanding borrowings under the secured revolver and
pre-fund capital spending.  After the offering, SD would have
roughly $330 million of cash and $1.050 billion of available
secured revolver borrowing capacity.

SD's current ratings and outlook incorporate high leverage
relative to SD's peers, its high outspending of cash flow, and a
risk of substantial capital dissipation if its large exploration
and development program disappoints.

However, the ratings also consider strong front-end equity funding
underpinning SD's aggressive exploration and development drilling
program, strong drilling results in the established Pinon Field,
accelerating production rates, promising results in SD's
exploration acreage to the east along the West Texas Overthrust
Trend, sufficient liquidity to fund the $1.5 billion 2008 capital
program, substantial reduction in current and forecasted net debt
per unit of production due to accelerating production, and roughly
flat net debt leverage on proven developed reserves and fully
loaded leverage on total proven reserves.

Moody's will continue to monitor the success of the company's
drilling program throughout 2008 to determine the extent to which
quarterly production increases are commensurate with the level of
offset additional debt as reflected by the debt/production metric.  
Production is accelerating and debt per unit of production ahs
been declining.  Production averaged 29,320 boe/day (176
mmcfe/day) in 2007, 36,990 boe/day (222 mmcfe/day) in fourth
quarter 2007, 41,833 boe/day (251 mmcfe/day) in first quarter 2008
and, as estimated by Moody's, significantly higher in May 2008.

The ratings are restrained by very high leverage, which leaves
little room if the drilling program underperforms.  SD's ratings
are restrained by high leverage on proven developed reserves,
production and cash flow, and on total proven reserves (debt plus
FAS 69 capex divided by total proven reserves).  Cash flow after
capital spending will be negative well into 2009.  The core credit
issue remains the scale and productivity of drilling activity that
SD can mount and sustain at its core remote Pinon Field in the
West Texas Overthrust play.  SD needs to continually boost
production and reserves relative to debt to establish momentum for
a higher rating.

Pro-forma Gross Debt / PD reserves would be in the $17/PD boe
range on March 31, 2008 PD reserves but Net Debt/ PD reserves of
$13.08/PD boe is only slightly higher than year-end 2007's level
of $12.80/PD boe.  Leverage on PD reserves may rise during 2008 as
SD mounts major front-end spending in advance of establishing
commensurate reserve bookings by year-end 2008.  Pro-forma net
leverage per unit of current daily production would be $33,516/boe
of daily production, down from $37,959 on fourth quarter 2007
production.

With estimated 2008 cash flow of $600 million, over $100 million
of expected asset sale proceeds, and budgeted capital spending of
$600 million, SD will substantially outspend 2008 cash flow.  The
shortfall will be funded with over $300 million in net cash note
proceeds remaining after repaying existing revolver debt and
secured revolver borrowings.

SandRidge Energy, Inc. is headquartered in Oklahoma City,
Oklahoma.


SCRIPPS FRENCH: Case Summary & Seven Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Scripps French Valley Commercial, LLC
        484 Prospect St.
        La Jolla, CA 92037

Bankruptcy Case No.: 08-04070

Chapter 11 Petition Date: May 14, 2008

Court: Southern District of California (San Diego)

Debtor's Counsel: Bruce A. Wilson, Esq.
                  2031 Fort Stockton Dr.
                  San Diego, CA 92103
                  Tel: (619) 497-0627
                  Fax: (619) 497-0628
                  Email: Brucewils@aol.com

Estimated Assets: $10 million to $50 million

Estimated Debts:   $1 million to $10 million

Debtor's Seven Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
Cox, Castle & Nicholson, LLP   Legal services        $109,409
Attn: Adam B. Weissburg
19800 MacArthur Blvd.,
Ste. 500
Irvine, CA 92612
Tel: (949) 476-2111

Developers Research            Consulting services   $90,144
Attn: Scot Oldham
2151 Michelson Dr., Ste. 190
Irvine, CA 92612
Tel: (949) 861-3300

Scripps Investments & Loans,   Services              $24,180
Inc.
484 Prospect St.
La Jolla, CA 92037
Tel: (858) 866-6300

FCI Lender Services, Inc.      Foreclosure services  $20,016

Lavine, Lofgren, Morris &      Legal Services        $5,000

Solomon Ward Seidenwurm &      Legal Services        $698
Smith, LLP

John Condas                    Services              $154


SENTINEL MANAGEMENT: Files Disclosure Statement in Illinois
-----------------------------------------------------------
Sentinel Management Group Inc. together with the Official
Committee of Unsecured Creditors and the appointed Chapter 11
Trustee Frederick J. Grede, as co-proponents, delivered to the
Hon. John H. Squires of the U.S. Bankruptcy Court for the Northern
District of Illinois a Disclosure Statement dated May 13, 2008,
explaining their Chapter 11 Plan of Liquidation.

                      Overview of the Plan

The Plan contemplates the liquidation of the Debtor's property
and distribution of any recoveries to its creditors.  The Plan
provides for the transfer of all asset of the Debtor's into the
liquidation trust.  A liquidation trustee will be appointed to
implement and administer the Plan.

On the effective date, the liquidation trustee will maintain a
reserve for the payment of Bank of New York's disputed secured
claim.  Money will be set aside from the cash on hand equal to the
full amount stated on the proof of claim filed by BoNY on the
Plan's effective date.

                Treatment of Claims and Interests

Under the Plan, holders of these claims are expected to get 100%
including:

   i) administrative claims, totaling $7,000,000;
  ii) secured claims of BoNY, totaling $312,247,000;
iii) other priority claims; and
  iv) priority tax claims.

In addition, holders of secured claims will either receive cash or
collateral securing their allowed secured claim in an amount equal
to that claim.

Each holder of Customer Claim, totaling roughly $1,220,320,123
of which $427,678,307 is attributable to Citadel-Beneficiary
customers, will receive a pro rata distribution of customer
property.  Holder are expected to recover between 35% to 71%.  On
the contrary, Citadel-Beneficiary will not get any distributions
until all other customers receive the same percentage recovery
distribution as the Citadel-Beneficiary Customers including
interest pursuant to the Plan.

Allowed General Unsecured creditors, totaling $10,000,000, will
also receive a pro rata distribution of cash and cash proceeds of
all property not allocated for payment of allowed claims in other
classes.

These creditors will not get any distribution on account of their
claims including:

   i) subordinated claims, totaling $6,088,895 and
  ii) equity interest.

A full-text copy of the Disclosure Statement is available for free
at http://ResearchArchives.com/t/s?2bf2

A full-text copy of the Chapter 11 Plan of Liquidation is
available for free at http://ResearchArchives.com/t/s?2bf3

                    About Sentinel Management

Based in Northbrook, Illinois, Sentinel Management Group Inc. --
http://www.sentinelmgi.com/-- is a full service firm offering a
variety of security solutions. The company filed a voluntary
chapter 11 petition on Aug. 17, 2007 (Bankr. N.D. Ill. Case No.
07-14987).  Ronald Barliant, Esq., Randall Klein, Esq., and
Kathryn A. Pamenter, Esq., at Goldberg, Kohn, Bell & Black
Rosenbloom & Moritz, Ltd. represent the Debtor.  Quinn, Emanuel
Urquhart Oliver & Hedges, LLP, represent the Official Committee
of Unsecured Creditors.  DLA Piper US LLP represents as the
Committee's co-counsel.  When the Debtor sought bankruptcy
protection, it listed assets and debts of more than $100 million.

On Aug. 28, 2007, the Court approved Frederick Grede as the
Debtor's Chapter 11 Trustee.  Mr. Grede selected Catherine L.
Steege, Esq., Christine L. Childers, Esq., and Vincent E. Lazar,
Esq., at Jenner & Block LLP as his counsels.

As reported in the Troubled Company Reporter on Dec. 19, 2007,
the Court extended, until June 13, 2008, the Debtor's exclusive
periods to file a Chapter 11 plan of reorganization and disclosure
statement.


SENTINEL MANAGEMENT: U.S. Trustee Amends Creditors' Panel Members
-----------------------------------------------------------------
The U.S. Trustee for Region 11 amended the members of the Official
Committee of Unsecured Creditors of Sentinel Management Group Inc.
following the resignation of FC Stone LLC in the committee.

The creditors committee's current members are:

   a) Discus Master Ltd.
      ATTN: Philippe Jordan
      CraigMuir Chambers
      P.O. Box 71
      Road Town, Tortola
      British Virgin Islands

   b) Jump Trading
      ATTN: William DiSomma
      600 W. Chicago Avenue #825
      Chicago, Illinois 60610

   c) Penson GHCO
      ATTN: Carl Gilmore
      600 W. Chicago Avenue, Suite 775
      Chicago, Illinois 60610

   d) Rotchford Barker
      ATTN: Rotchford Barker
      40 County Road 2AC
      P.O. Box 2080
      Cody, Wyoming 82414

   e) JEM Commodity Relative Value Fund LP
      ATTN: John Moody
      28 S.W. 1ST Avenue, Suite 420
      Portland, Oregon 97201

   f) Vision Financial Markets LLC
      ATTN: Michael Doherty
      4 High Ridge Park Suite 100  
      Stamford, Connecticut 06905           

   g) BC Capital Fund A, LLC
      ATTN: Timothy Currie
      2813 Northwood Circle
      Corning, New York 14830

   h) Kottke Associates LLC
      ATTN: Carmen Soldato
      141 W. Jackson, Suite 1220
      Chicago, Illinois 60604

Official creditors' committees have the right to employ legal and
accounting professionals and financial advisors, at the Debtors'
expense.  They may investigate the Debtors' business and financial
affairs.  Importantly, official committees serve as fiduciaries to
the general population of creditors they represent.  Those
committees will also attempt to negotiate the terms of a
consensual Chapter 11 plan -- almost always subject to the terms
of strict confidentiality agreements with the Debtors and other
core parties-in-interest.  If negotiations break down, the
Committee may ask the Bankruptcy Court to replace management with
an independent trustee.  If the Committee concludes reorganization
of the Debtor is impossible, the Committee will urge the
Bankruptcy Court to convert the Chapter 11 cases to a liquidation
proceeding.

                    About Sentinel Management

Based in Northbrook, Illinois, Sentinel Management Group Inc. --
http://www.sentinelmgi.com/-- is a full service firm offering a
variety of security solutions. The company filed a voluntary
chapter 11 petition on Aug. 17, 2007 (Bankr. N.D. Ill. Case No.
07-14987).  Ronald Barliant, Esq., Randall Klein, Esq., and
Kathryn A. Pamenter, Esq., at Goldberg, Kohn, Bell & Black
Rosenbloom & Moritz, Ltd. represent the Debtor.  Quinn, Emanuel
Urquhart Oliver & Hedges, LLP, represent the Official Committee
of Unsecured Creditors.  DLA Piper US LLP represents as the
Committee's co-counsel.  When the Debtor sought bankruptcy
protection, it listed assets and debts of more than $100 million.

On Aug. 28, 2007, the Court approved Frederick Grede as the
Debtor's Chapter 11 Trustee.  Mr. Grede selected Catherine L.
Steege, Esq., Christine L. Childers, Esq., and Vincent E. Lazar,
Esq., at Jenner & Block LLP as his counsels.

As reported in the Troubled Company Reporter on Dec. 19, 2007,
the Court extended, until June 13, 2008, the Debtor's exclusive
periods to file a Chapter 11 plan of reorganization and disclosure
statement.


SHARPER IMAGE: Hilco Joint Venture Named Stalking Horse Bidder
--------------------------------------------------------------
A joint venture led by Hilco Consumer Capital, L.P., and GB
Brands, LLC, in partnership with Windsong Brands, LLC and Crystal
Capital, was approved by the U.S. Bankruptcy Court for the
District of Delaware as the stalking horse bidder for certain
assets of The Sharper Image Corporation.

HCC and GBB have developed a global licensing strategy for
wholesale, retail, direct-to-retail, e-commerce and catalog
businesses which will exploit The Sharper Image's heritage of
quality, excitement, innovation and fun.

During its 32-year history, The Sharper Image has developed one of
America's most widely recognized and positively perceived consumer
brands. HCC and GBB recognize The Sharper Image's blend of upscale
specialty positioning, iconic stature, outstanding consumer
recognition and appeal across a wide demographic.

Jamie Salter, CEO of HCC, commented, "The Sharper Image's brand
versatility encompasses a vast array of products which
demonstrates the powerful and consistent brand attributes of
quality, excitement, innovation and fun." He added, "Whether it is
electronics, housewares, health and fitness or unique gifts in
personal care or travel, The Sharper Image brand delivers on all
of the brand's attributes."

Stephen Miller of GBB continued, "GBB envisions this to be a
terrific opportunity to transform a tier-one, iconic American
brand into a global, multi-channel platform of diverse and unique
consumer products using leading technologies and trend-setting
innovations. This reflects the core transformational competencies
of the joint venture partners and we look forward to working with
new licensees to grow the brand worldwide and in multiple
categories."

The joint venture will partner with a number of global
institutions in the ongoing development of The Sharper Image
brand.

                    About Hilco Consumer Capital

Hilco Consumer Capital -- http://www.hilcocc.com/-- is a private  
equity firm that makes strategic investments in consumer lifestyle
brands through acquisitions of North American manufacturers,
wholesalers, intellectual property and retailers. HCC investments
range from $25 million to $250 million.  Current portfolio brands
and companies include Caribbean Joe(R: 75.02, +0.71, +0.95%),
Ellen Tracy, Halston(R: 75.02, +0.71, +0.95%), Tommy Armour
Golf(R: 75.02, +0.71, +0.95%), RAM Golf(R: 75.02, +0.71, +0.95%),
and Bombay Brands, LLC. HCC is a unit of The Hilco Organization, a
Chicago-based, international provider of diversified financial and
operational services, including business asset valuations, asset
acquisition and disposition services, M&A services and retail
consulting.

                       About GB Brands, LLC

GB Brands, LLC is a member of the Gordon Brothers Group family of
companies. GB Brands LLC purchases, sells, and licenses brands and
other intellectual property. Founded in 1903, Gordon Brothers
Group -- http://www.GordonBrothers.com/-- is a global advisory,  
restructuring and investment firm specializing in retail and
consumer products, industrial and real estate sectors. Gordon
Brothers Group maximizes value for both healthy and distressed
companies by purchasing or selling all categories of assets,
appraising assets, providing debt financing, making private equity
investments, and operating businesses for extended periods. Gordon
Brothers Group conducts over $40 billion in annual transactions
and appraisals.

Its private equity fund, 1903 Equity Fund, holds majority or
minority positions in a portfolio of companies including Como Fred
David, Clair de Lune, Deb Shops, Dollarama, Grafton-Fraser, Laura
Secord, Things Remembered and Toys R Us.

                    About Windsong Brands LLC

Windsong Brands, LLC -- http://www.windsongbrands.com/-- is a  
private equity firm that focuses on investments in leading middle
market consumer companies that own strong recognizable brands. The
team has a diverse background of consumer expertise that assists
and guides company management to unlock the true potential of
their brand. Windsong Brands makes majority and minority
investments in both public and private companies. Investments and
portfolio brand companies include Ellen Tracy, Caribbean Joe,
Joe's Jeans, Field & Stream, Como Sport, and Alerion Aviation.

                      About Crystal Capital

Established by a team of experienced financial professionals,
Crystal Capital is an investment firm that provides capital for
middle market companies across all industries. The founding
principals each have over 25 years of experience and have provided
in excess of $15 billion in creative capital commitments for
buyouts, recapitalizations, refinancings and growth opportunities.

                       About Sharper Image

Based in San Francisco, California, Sharper Image Corp. --
http://www.sharperimage.com/-- is a multi-channel specialty
retailer.  It operates in three principal selling channels: the
Sharper Image specialty stores throughout the U.S., the Sharper
Image catalog and the Internet.  The company has operations in
Australia, Brazil and Mexico.  In addition, through its Brand
Licensing Division, it is also licensing the Sharper Image brand
to select third parties to allow them to sell Sharper Image
branded products in other channels of distribution.  

The company filed for Chapter 11 protection on Feb. 19, 2008
(Bankr. D.D., Case No. 08-10322).  Steven K. Kortanek, Esq. at
Womble, Carlyle, Sandridge & Rice, P.L.L.C. represents the Debtor
in its restructuring efforts.  An Official Committee of
UnsecuredCreditors has been appointed in the case.  When the
Debtor filed for bankruptcy, it listed total assets of
US$251,500,000 and total debts of US$199,000,000.  (Sharper Image
Bankruptcy News; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)


SI INTERNATIONAL: S&P Withdraws Ratings at Company's Request
------------------------------------------------------------
Standard & Poor's Ratings Services withdrew its ratings, including
the 'B+' corporate credit rating, on Reston, Virginia-based SI
International Inc. at the company's request.


SIX FLAGS: Exchange Notes Offer Cues Moody's to Hold Caa1 Rating
----------------------------------------------------------------
Moody's Investors Service affirmed Six Flags, Inc.'s Caa1
Corporate Family rating, downgraded Six Flags' Probability of
Default Rating to Ca from Caa1 and downgraded the ratings on Six
Flags' 2013 and 2014 notes to Caa3 from Caa1.  Moody's also
assigned a Caa2 rating and LGD4-59% assessment to Six Flags
Operations, Inc.'s proposed $400 million of senior unsecured
exchange notes maturing in 2016.

The rating actions follow Six Flags' announced offer to exchange
its notes due in 2010 (at 90% of the original principal amount if
tendered by the Early Tender Date) and in 2013 and 2014 (at 70% of
the original principal amount if tendered by the Early Tender
Date), in some combination although not fully, for the $400
million of proposed notes.  The exchange involves no significant
net cash proceeds to Six Flags or bondholders and is scheduled to
expire on June 11, 2008.  The rating actions are detailed as:

Assignments:

Issuer: Six Flags Operations, Inc.

  -- Senior Unsecured Regular Bond/Debenture
     (2016 Exchange Notes), Assigned Caa2, LGD4-59%

Downgrades:

Issuer: Six Flags Inc.

  -- Probability of Default Rating, Downgraded to Ca from Caa1
  -- Senior Unsecured Notes due 2013 and 2014, Downgraded to Caa3,
     LGD3-30% from Caa2, LGD5-76%

LGD Updates:

Issuer: Six Flags Theme Parks Inc.

  -- Senior Secured Bank Credit Facility, Changed to B1, LGD2-20%
     from B1, LGD2-19%

Issuer: Six Flags Inc.

  -- Senior Unsecured Notes due 2010, Changed to Caa2, LGD2-10%
     from Caa2, LGD5-76%

On Review for Possible Downgrade:

Issuer: Six Flags Inc.

  -- Senior Unsecured Notes due 2010, currently Caa2, LGD2-10%

Outlook Actions:

Issuer: Six Flags Inc.

  -- Outlook, Changed To Ratings Under Review (2010 Notes only)
     from Negative

Issuer: Six Flags Operations, Inc.

  -- Outlook, Changed To Negative

The proposed $400 million of exchange notes will be guaranteed by
Six Flags, Inc. and will be structurally senior with respect to
the wholly-owned parks to the existing $1.4 billion of senior
unsecured notes and $288 million of mandatory redeemable preferred
stock issued by Six Flags, Inc.  The SFO exchange notes and Six
Flags, Inc. notes have the same senior unsecured claim on the
Texas and Georgia partnership park interests.  

The exchange notes are effectively and structurally subordinate to
the $1.1 billion senior secured credit facility issued by Six
Flags Theme Parks, Inc. with respect to the wholly-owned parks.  
SFO is a subsidiary of Six Flags, Inc. and an intermediate holding
company of SFTP.  Moody's estimates there is minimal room under
the proposed 6.5x debt incurrence test (based on the Leverage
Ratio, as defined, for SFO and its subsidiaries) in the exchange
notes for incremental debt at SFO or SFTP absent an improvement in
operating performance at the wholly-owned parks.  In addition, the
exchange notes have a change of control put right at 101% of par.

Moody's believes the exchange offer reduces the near term
potential for a payment default on the non-exchanged securities
(however, Moody's will classify the exchange as a default due to
the distressed nature of the same), but it does not materially
alter the credit profile reflected in the Caa1 CFR.  The exchange
offer alleviates some of the refinancing risk associated with the
looming $280 million February 2010 bond maturity, but will likely
affect the company's cash interest requirements only moderately
(could increase or decrease depending on the mix of bonds
tendered) and does not improve the company's weak cash flow
generation or materially reduce the very high leverage.  The
exchange offer also does not address the August 2009 PIERS
redemption date, although the company's negative equity position
may preclude a redemption of the PIERS under Delaware law.

The current ratings on the 2010, 2013 and 2014 notes will remain
in place until the exchange offer closes and are based on Moody's
estimate of the expected near term loss on the original principal
in the exchange offer given the likelihood of the transaction
closing as outlined in the company's May 14, 2008 press release.   
As noted, Moody's expects to characterize the proposed transaction
as a distressed exchange and will change the PDR to Caa1/LD if the
exchange offer closes, and then back to Caa1 approximately three
days thereafter.  Moody's expects the ratings on any 2010, 2013
and 2014 notes that remain outstanding following the exchange
offer to be Caa3 with a LGD5-85% assessment, although the LGD
point estimates could change slightly depending on the mix of
bonds exchanged.  The current Caa2 rating on the 2010 notes
remains on review for downgrade based on the expectation that the
rating will be lowered to Caa3 upon closing of the exchange offer.

The B1 rating and LGD2-20% assessment on SFTP's credit facility,
the Caa2 rating and LGD4-59% assessment on the proposed
$400 million exchange notes, and the Caa3 rating and LGD6-98%
assessment on the PIERS reflect the probability of a subsequent
default on the non-exchanged securities and the projected loss
given default of these securities, the latter of which is governed
by Moody's loss given default methodology and the anticipated debt
mix upon completion of the proposed exchange offer.  Accordingly,
Moody's anticipates the ratings and LGD assessments for these
specific instruments will not change if the exchange offer is
closed.  The LGD point estimates on the credit facility were
updated to reflect the change in expected debt mix.

Six Flags' Caa1 CFR continues to reflect uneven and weak operating
performance resulting from shifts in strategy for the portfolio of
regional theme parks, consistently negative free cash flow
generation and very high leverage and financial risk.  Debt-to-
EBITDA (14.6x for FY 2007 incorporating Moody's standard
adjustments) has increased in the last few years, notwithstanding
significant asset sales, and is at a level Moody's views as
unsustainable.  Moody's expects the rating outlook will be
negative upon completion of the exchange offer.

Six Flags, headquartered in New York City, is a regional theme
park company that operates 21 parks spread across North America.  
The park portfolio includes 19 wholly-owned facilities (including
parks near New York City, Chicago and Los Angeles) as well as two
parks - Six Flags over Texas and Six Flags over Georgia - in which
Six Flags owns partial interests (currently less than 50%) but
consolidates due to significant operational control and residual
economic interest.  Annual revenue approximates $970 million.


SKYBUS AIRLINES: U.S. Trustee Appoints 5-Member Creditors Panel
---------------------------------------------------------------
The United States Trustee for Region 3 appoined five members to
the Official Committee of Unsecured Creditors in the chapter 11
case of Skybus Airlines, Inc.:

   1. Sourcespeed LLC
      Attn: Geoffrey Alan Wolfe
      420 Wolfe Street
      Alexandria, VA 22314
      Tel: (703) 201-3593
      Fax: (928) 447-0807

   2. Port City Air, Inc.
      Attn: Michael A. Holmes
      104 Grafton Drive
      Portsmouth, NH 03801
      Tel: (430) 430-1111
      Fax: (603) 430-1199

   3. World Fuel Services Inc.
      Attn: Richard V. Mellone
      9800 NW 41 st Street, Suite 400
      Miami, FL 33178
      Tel: (305) 428-8085
      Fax: 305-392-5601

   4. Wells Fargo Bank Northwest, N.A.
      Attn: Russell Hettinger, Vice President
      100 NE 3rd Ave., Suite 800
      Fort Lauderdale, FL 33301
      Tel: (954) 760-7777
      Fax: 954-760-7716

   5. Airbus North America Customer Services, Inc.
      Attn: Boris Sakrauski
      198 Van Buren Street, Suite 300
      Herndon, VA 20170
      Tel: (703) 834-3400
      Fax: 703-834-3340

William K. Harrington, Esq., represents the U.S. Trustee in the
Debtor's case.

                    About Skybus Airlines

Headquartered in Columbus, Ohio, Skybus Airlines, Inc., --
http://www.skybus.com/-- operates a domestic airline and had
destinations in 15 cities in the United States.  On April 4, 2008,
it ceased its flights opeartions and grounded all of its
acircrafts.  The company filed for Chapter 11 protection on April
5, 2008 (Bankr. D. Del. Case No.08-10637).   Adam G. Landis, Esq.,
and Matthew B. McGuire, Esq., at Landis Rath & Cobb LLP, represent
the Debtor in its restructuring efforts.  The U.S. Trustee for
Region 3 appointed an Official Committee of Unsecured Creditors in
this case.  David B. Stratton, Esq., at Pepper Hamilton LLP,
represents the Committee.  When the Debtor filed for protection
against its creditors, it listed assets between $100 million and
$500 million and debts between $10 million and $100 million.


SKYBUS AIRLINES: Files Schedules of Assets and Liabilities
----------------------------------------------------------
Skybus Airlines, Inc., delivered to the United States Bankruptcy
Court for the District of Delaware its schedules of assets and
liabilities disclosing:

   Name of Schedule                   Assets        Liabilities
   ----------------                -----------      -----------
   A. Real Property                         $0
   B. Personal Property           $121,344,036
   C. Property Claimed
      as Exempt
   D. Creditors Holding                             $52,380,791
      Secured Claims
   E. Creditors Holding                             $32,031,996
      Unsecured Priority
      Claims
   F. Creditors Holding                             $18,863,541
      Unsecured Nonpriority
      Claims
                                   ------------   -------------
      TOTAL                        $121,344,036    $103,276,329

                    About Skybus Airlines

Headquartered in Columbus, Ohio, Skybus Airlines, Inc. --
http://www.skybus.com/-- operates a domestic airline and had
destinations in 15 cities in the United States.  On April 4, 2008,
it ceased its flights opeartions and grounded all of its
acircrafts.  The company filed for Chapter 11 protection on April
5, 2008 (Bankr. D. Del. Case No.08-10637).   Adam G. Landis, Esq.,
and Matthew B. McGuire, Esq., at Landis Rath & Cobb LLP, represent
the Debtor in its restructuring efforts.  The U.S. Trustee for
Region 3 appointed an Official Committee of Unsecured Creditors in
this case.  David B. Stratton, Esq., at Pepper Hamilton LLP,
represents the Committee.


SMI NEW HOME: Case Summary & 15 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: SMI New Home Solutions, LLC
        P.O. Box 139
        Union, KY 41091

Bankruptcy Case No.: 08-20895

Type of Business: The Debtor builds homes.  See
                  http://www.sminewhomesolutions.com/

Chapter 11 Petition Date: May 5, 2008

Court: Eastern District of Kentucky (Covington)

Debtor's Counsel: Stuart P. Brown, Esq.
                  Email: sbrown@ortlaw.com
                  O'Hara Ruberg Taylor Sloan & Sergen
                  25 Crestview Hills Mall Rd., Ste. 201
                  P.O. Box 17411
                  Crestview Hills, KY 41017
                  Tel: (859) 331-2000
                  Fax: (859) 578-3365

Estimated Assets: $1 million to $10 million

Estimated Debts:  $1 million to $10 million

Debtor's 15 Largest Unsecured Creditors:

   Entity                      Nature of Claim       Claim Amount
   ------                      ---------------       ------------
Contract Lumber                                      $102,045
3245 Hazelton-Etna Rd.
Pataskala, OH 43062

Chase Cardmember Service       Business credit card  $77,539
P.O. Box 15292
Wilmington, DE 19886

NuWay Drywall Co.              HT043                 $4,920
150 Washington Ave.
Bellevue, KY 41073

                               CC017                 $4,899

                               BL013                 $4,581

J-Mar Concrete                 (HT 32) Lot 32 HT     $6,789
                               (Foundation poured);
                               value of security:
                               $86,462; value of
                               senior lien: $95,417

J-Mar Concrete                 BL011                 $6,139

Pacific Life                   IRA Match             $12,562

McSwain Carpets, Inc.          C017                  $7,369

                               HT043                 $4,760

Kentucky Farm Bureau Insurance                       $9,972
Co.

Central Light                  SB 1, BL 11, BL 13,   $8,423
                               BL 9, BL 47, CC 17,
                               HT 43, HT 20, WW
                               36, WW 38, SC 303

84 Lumber Co.                  CC 017                $7,758

Carl Domaschko Excavation      HT 032, BL 5, CC      $7,319
                               17, SC 303, HT 32,  
                               SB 1, BL 5

Joe Lay & Sons Plumbing        HT043                 $6,066

Wood, Herron & Evans                                 $5,710

Ikon Office Solutions                                $5,473

R.O. Why!Marketing                                   $5,000


SUNCREST LLC: Section 341(a) Meeting Scheduled for May 19
---------------------------------------------------------
The U.S. Trustee for Region 18 will convene a meeting of creditors
of SunCrest LLC, fka DAE/Westbrook LLC, at 9:30 a.m., on May 19,
2008, at The City Library, 210 East 400 South, Auditorium, in Salt
Lake City, Utah.

This is the first meeting of creditors required under Section
341(a) of the Bankruptcy Code in all bankruptcy cases.

All creditors are invited, but not required, to attend.  This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible office of the
Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.

Based in Draper, Utah, SunCrest, L.L.C. fka DAE/Westbrook LLC --
http://www.suncrest.com-- develops master planned community    
located in the Traverse Ridge in Draper in both Salt Lake and Utah
Counties.  At present, approximately 2,452 homes sites remain  
available out of 3,903 sites.  The company holds a majority of the
representative positioms with the SunCrest Home Owners
Association. The company has spent at least $102 million on land
development in the aggregate, pursuant to court documents.

The Debtor filed chapter 11 protection on April 11, 2008 (Bankr.
D. Utah Case No. 08-22302) with Judge William T. Thurman
presiding.  John E. Mitchell, Esq., P. Beth Lloyd, Esq., and
William L. Wallander, Esq., at Vinson & Elkins L.L.P., represent
the Debtor.  The Debtor listed total assets of $54,057,922 and
total liabilities of $55,329,651.


SUPERVALU INC: S&P Puts 'BB+' Rating on Existing $4BB Facilities
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its issue-level and
recovery ratings on SUPERVALU INC.'s existing $4.0 billion senior
secured credit facilities.  The credit facilities are rated 'BB+',
with a recovery rating of '1', indicating S&P's expectation for
very high (90% to 100%) recovery in the event of a payment
default.

At the same time, Standard & Poor's affirmed its 'BB-' corporate
credit rating on SUPERVALU. The outlook is positive.
     
SUPERVALU's $4.0 billion credit facilities, which consist of a
$2.0 billion revolving credit facility, a $750 million term loan
A, and a $1.25 billion term loan B, were issued in June 2006.  
Proceeds from the term loans A and B were used to partially fund
SUPERVALU's acquisition of Albertson's Inc. in mid-2006.
     
"The rating on Minneapolis-based SUPERVALU reflects the company's
participation in the highly competitive supermarket industry, its
limited free operating cash flow given its sizable capital
expenditure needs, its leveraged balance sheet, and its older
acquired store base compared with large industry peers," said
Standard & Poor's credit analyst Diane Shand.  "The company's
large scale, good market positions, broad geographic reach, and
format diversity partially mitigate those weaknesses."
     
SUPERVALU's $44 billion in annual revenues rank it in second place
among traditional supermarkets, behind Kroger Co.'s roughly
$70 billion in the fiscal year ended February 2008.  The
supermarket industry remains highly competitive, with many
alternative food retailers such as supercenters, wholesale clubs,
convenience stores, and drugstores expanding their grocery
offerings over the years.


TRANSMERIDIAN EXPLO: March 31 Balance Sheet Upside-Down by $31MM
----------------------------------------------------------------
Transmeridian Exploration Inc.'s consolidated balance sheet at
March 31, 2008, showed $402.2 million in total assets,
$341.2 million in total liabilities, and $92.5 million in
redeemable convertible preferred stock, resulting in a
$31.5 million total stockholders' deficit.

At March 31, 2008, the company's consolidated balance sheet also
showed strained liquidity with $6.0 million in total current
assets available to pay $62.2 million in total current
liabilities.

The company reported a net loss of $10.9 million on oil sales of
$15.3 million for the first quarter ended March 31, 2008, compared
with a net loss of $15.5 million on oil sales of $7.1 million in
the corresponding period a year ago.

Net revenues for the three months ended March 31, 2008, increased
approximately 113.0%, over the comparable period of 2007 although
the total volumes sold decreased.  This is due primarily to the
higher average price per bbl and the mix of export and domestic
sales.  For the three months ended March 31, 2008, the company  
sold 221,355 bbls at an average price of $72.25 per bbl.  

In the first quarter of 2007, the company sold 130,180 bbls in the
export market at an average price of $31.22 per bbl and 136,258
bbls in the domestic market at an average price of $25.30 per bbl.
In April 2007, the company began export pipeline sales which have
allowed the company to receive a higher price per bbl as compared
to export sales via rail where the purchaser is responsible for
transportation costs, thus resulting in a higher discount from
quoted crude oil prices.  

Additionally, crude oil prices on the quoted global exchanges were
significantly higher on average in the first quarter of 2008 as
compared to the first quarter of 2007.

The average number of producing wells increased from 10.4 wells in
the first quarter of 2007 to 12.3 wells in the first quarter of
2008.  Average daily production, however, decreased, due primarily
to the lack of acid stimulation on newly completed wells, deferred
workovers on existing wells and the delay of a pressure
maintenance project because of a lack of sufficient operating
funds, which has not allowed wells to flow at their optimal
levels.

The company recognizes revenue from the sale of oil when the
purchaser takes physical delivery of the oil.  As of March 31,
2008, the company had 18,817 bbls of oil in inventory that had not
yet been sold, as compared to 59,373 bbls as of Dec. 31, 2007.

Total operating costs and expenses increased to $15.5 million from
$13.7 million during the three months ended March 31, 2007,
primarily due to higher operating and admistrative expense in
Kazakhstan, primarily as a result of a reduction of inventory
between periods.  

In addition, for the three months ended March 31, 2008,  
transportation and storage costs were $1.5 million, or $6.72 per
bbl, as compared to $1.1 million, or $3.58 per bbl, for the first
quarter of 2007.  The increase is due to the increase of export
pipeline sales in the first quarter of 2008 for which the company  
incurs pipeline charges on the crude oil transported to the
applicable ports of loading.

                         Interest Expense

Interest expense, net of capitalized interest of $181,000, was
$10.6 million for the three month period ended March 31, 2008, as
compared to interest expense of $9.0 million, net of $1.8 million
of capitalized interest, for the three month period ended
March  31, 2007.  This increase is primarily due to the decrease
in the amount of interest capitalized in the first quarter of 2008
as compared to the same quarter of 2007.  

Capitalized interest decreased in the first quarter of 2008
primarily due to decreased drilling activity and the commissioning
of the company's central production facility and related equipment
and the connection to the regional pipeline system in the second
half of 2007.

                 Liquidity and Capital Resources

The company is currently carrying out a limited workover program
in the South Alibek Field (the Field) to clean out paraffin
deposits in wells and install continuous gas lift equipment in
selected wells.  At current production levels of approximately
2,100 bopd, and at the prices the company currently receives,
management believes it will be able to generate sufficient cash
flow to cover operating costs, overhead and scheduled interest
payments on its debt.

The company utilized much of its excess liquidity during the
period in 2007 when the Field was shut-in to fund operating costs,
overhead, scheduled interest payments and necessary capital
expenditures.  As a result, the company does not currently have
the necessary resources to allow for continued drilling of
exploration and development wells and to meet other working
capital obligations.  

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?2bf1

                       Going Concern Doubt

UHY LLP in Houston raised substantial doubt on Transmeridian's
ability 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 negative working capital, stockholders' deficit, and
operating losses since its inception.

The company had a net working capital deficit of approximately
$56.2 million and a stockholders' deficit of approximately
$31.5 million at March 31, 2008.  Approximately 89.0% of the
company's accounts payable at March 31, 2008, have been
outstanding more than 120 days.  

                 About Transmeridian Exploration

Based in Houston, Transmeridian Exploration Inc. (AMEX: TMY) --
http://www.tmei.com/ -- is an independent energy company  
established to acquire and develop oil reserves in the Caspian Sea
region of the former Soviet Union.  The company's primary oil and
gas property is the South Alibek Field in the Republic of
Kazakhstan covered by License 1557 and the related exploration and
production contracts with the government of Kazakhstan.


TRIAD FINANCIAL: Moody's Junks Ratings on Citigroup Deal Amendment
------------------------------------------------------------------
Moody's Investors Service downgraded the ratings of Triad
Financial Corp. and placed the ratings on review for possible
further downgrade.

The rating action is precipitated by Triad's 8-K filing that,
pursuant to an amendment to the company's Warehouse Lending
Agreement with Citigroup, this facility will cease to be available
to the company to fund new originations as of June 30, 2008
(original maturity date of the facility was April 29, 2009).  In
the 8-K filing Triad also announced that three directors, each of
whom had been appointed to the board by the Goldman Sachs
investors, had resigned.

The Citigroup facility is one of two warehouse facilities
maintained by Triad, the other being a $500 million facility from
Barclays Bank that matures in January 2009.  However, in the same
8-K filing, Triad calls into question its ability to borrow under
the Barclay's facility.  In Moody's view, these developments
represent a material impairment of the company's liquidity and
financial flexibility.  The inability to access funding for new
originations would also severely damage Triad's franchise.  During
its review, Moody's will evaluate a variety of factors, including
the prospects for arranging replacement financing on a timely
basis, the terms and conditions of such financing, and the
potential effects of these developments on the company's
operations and franchise.

These ratings were downgraded:

  -- Corporate Family Rating, to Caa1 from B2
  -- Senior Unsecured Debt, to Caa2 from B3

Based in Huntington Beach, California, Triad is an auto finance
company that operates primarily in the sub-prime segment of the
market.  The company had $3.9 billion in managed receivables as of
Dec. 31, 2007.


TROPICANA ENTERTAINMENT: Wants Lazard Freres as Financial Advisor
-----------------------------------------------------------------
Tropicana Entertainment LLC and its debtor-affiliates seek
authority from the U.S. Bankruptcy Court for the District of
Delaware to employ Lazard Freres & Co. LLC as their investment
banker and financial advisors in connection with the prosecution
of their Chapter 11 cases and all related matters.

The Debtors tell the Court that they need Lazard to provide them
advice on their restructuring activities.  The Debtors selected
Lazard because of the firm's extensive experience and excellent
reputation in providing financial advisory and investment banking
services in complex Chapter 11 cases.

Before the bankruptcy filing, the Debtors engaged Lazard to
provide general investment banking and financial advice in
connection with their attempts to complete a strategic
restructuring and to prepare for the commencement of their
Chapter 11 Cases.

Lazard will:

   a. review and analyze the Debtors' business, operations, and
      financial projections;

   b. evaluate the Debtors' potential debt capacity light of its
      projected cash flows;

   c. assist in determining a capital structure for the Debtors;

   d. assist in determining a range of estimated values for the
      Debtors on a going concern basis;

   e. advise the Debtors on tactics and strategies for
      negotiating with the stakeholders;

   f. render financial advice to the Debtors and participate in
      meetings or negotiations with the Stakeholders, rating
      agencies or other appropriate parties in connection with
      any Restructuring;

   g. advise the Debtors on the timing, nature, and terms of new
      securities, other consideration or other inducements to be
      offered pursuant to the Restructuring;

   h. advise and assist the Debtors in evaluating potential
      financing transactions by the Debtors, and, subject to
      Lazard's agreement so to act, and, if requested by Lazard,
      to execution of appropriate agreements, on behalf of the  
      Debtors, contacting potential sources of capital as the
      Debtors may designate and assist the Debtors in
      implementing the Financing;

   i. assist the Debtors in preparing documentation within
      Lazard's area of expertise that is required in connection
      with the Restructuring;

   j. subject to the mutual agreement of the Debtors and Lazard,
      assist the Debtors in identifying and evaluating candidates
      for a potential sale transaction, advise the Debtors in
      connection with negotiations and aid in the consummation
      of a Sale Transaction;

   k. attend meetings of the Debtors' Board of Directors and its
      committees with respect to matters on which Lazard has been
      engaged to advise the Debtors; and

   l. provide testimony, as necessary, with respect to matters on
      which Lazard has been engaged to advise the Debtors in any
      proceeding before any bankruptcy court.

In addition, Lazard will provide any additional investment
banking and financial advisory services in connection with the
engagement as the Debtors may reasonably request from time to
time.

                           Lazard's Fees

In exchange for the contemplated services, Lazard will be
entitled to monthly and transaction fees.

   A. Monthly Fee

      Lazard will receive a monthly fee of $75,000 payable on
      execution of its engagement letter with the Debtors and on
      the first day of each month thereafter until the earlier of
      the completion of the Restructuring or the termination of
      Lazard's engagement pursuant to the Engagement Letter;
      provided, that, if that the Debtors file for protection
      under bankruptcy law, each Monthly Fee payable after the
      date of the filing will be increased to $150,000.

      All Monthly Fees paid in respect of the first six months of
      the engagement will be credited, without duplication,
      against any Restructuring Fee, Sale Transaction Fee,
      Minority Sale Transaction Fee, or Financing Fee payable;
      provided, that, in the event of a Chapter 11 filing, the
      credit will only apply to the extent that the fees are
      approved in their entirety by the Bankruptcy Court, if
      applicable.

   B. Transaction Fees

      A fee equal to 0.75% of the aggregate face value of the
      Existing Obligations involved in a Restructuring will be
      payable to Lazard upon the consummation of a Restructuring
      involving the Debtors' bank debt, bond debt, and other on
      and off balance sheet indebtedness, ; provided, however,
      that if the Restructuring is to be completed through a
      "pre-packaged" or "pre-arranged" plan of reorganization,
      the Restructuring Fee will be earned and will be payable
      upon the earlier of (i) execution of definitive agreements
      with respect to the plan and (ii) delivery of binding
      consents to the plan by a sufficient number of creditors or
      bondholders, as the case may be, to bind the creditors or
      bondholders, as the case may be to the plan.  In the event
      Lazard is paid a fee in connection with a "pre-packaged" or
      "pre-arranged" plan and the plan is not consummated, Lazard
      will return the fee to the Debtors.

      In the event that the Debtors and Lazard mutually agree
      that Lazard will provide advice and assistance in
      connection with a possible Sale Transaction, then:

         (i) if, whether in connection with the consummation of a
             Restructuring or otherwise, the Debtors consummate a
             Sale Transaction incorporating all or a majority of
             the assets or all or a majority or controlling
             interest in the equity securities of the Debtors,
             Lazard will be paid a fee equal to the greater of
             (A) the fee calculated based on the Aggregate
             Consideration as set forth in a schedule attached
             to the Engagement Letter or (B) the Restructuring
             Fee;

        (ii) if, whether in connection with the consummation of a
             Restructuring or otherwise, the Debtors consummate
             any Sale Transaction not covered by clause (i)
             above, the Debtors will pay Lazard a fee based on
             a calculated Aggregate Consideration;

       (iii) any Sale Transaction Fee or Minority Sale
             Transaction Fee will be payable upon consummation of
             the applicable Sale Transaction.

      A fee, payable upon consummation of a Financing, equal to
      the amount set forth in another schedule to the Engagement
      Letter, one-half of any Financing Fee paid in respect of a
      Financing consummated in connection with a Restructuring of
      the Existing Obligations will be credited against any
      Restructuring Fee subsequently payable in respect of the
      Restructuring.  However, all Financing Fees paid in respect
      of a Financing solely involving Senior Secured Debt and
      consummated in connection with a Restructuring of the
      Existing Obligations will be credited against any
      Restructuring Fee subsequently payable in respect of the
      Restructuring.

      If Lazard provides services to the Debtors for which a fee
      is not provided, the services will, except insofar as they
      are the subject of a separate agreement, be treated as
      falling within the scope of the Engagement Letter, and the
      Debtors and Lazard will agree upon a fee for the services
      based on good faith negotiations.

      Lazard may be entitled to more than one of the fees.

Lazard's actual and necessary expenses related to the
contemplated services will also be reimbursed.

The Debtors relate that before the bankruptcy filing, they paid
$243,158 in full payment of monthly fees and expenses
reimbursement to Lazard for invoices billed through April 2008.  
They also paid Lazard $838,716 for the Financing Fee associated
with the pending DIP financing and for a retainer relating to the
firm's monthly fees and expense reimbursement incurred since the
last periodic invoice.  

Any portion of the payment not used to pay and reimburse Lazard
for its fees and expenses will be detailed in Lazard's first
interim fee application, and that portion will be credited towards
Lazard's fees and expenses as allowed by the Court.

The Debtors have also agreed to provide customary and reasonable
indemnification protection to Lazard.

Daniel M. Aronson, managing director of Lazard, assures the Court
that his firm is a "disinterested person" as the phrase is
defined in Section 101(14) of the Bankruptcy Code.

                About Tropicana Entertainment

Based in Crestview Hills, Kentucky, Tropicana Entertainment LLC --
http://www.tropicanacasinos.com/-- is an indirect subsidiary of   
Tropicana Casinos and Resorts. The company is one of the largest
privately-held gaming entertainment providers in the United
States. Tropicana Entertainment owns eleven casino properties in
eight distinct gaming markets with premier properties in Las
Vegas, Nevada and Atlantic City, New Jersey.

Tropicana Entertainment LLC filed for Chapter 11 protection on
May 5, 2008, (Bankr. D. Del. Case No. 08-10856) Its debtor-
affiliates filed for separate Chapter 11 petitions but with no
case numbers assigned yet. Kirkland & Ellis LLP and Mark D.
Collins, Esq. at Richards Layton & Finger represent the Debtors in
their restructuring efforts. Their notice, claims, and balloting
agent is Kurtzman Carson Consultants LLC. The Debtors'
consolidated financial condition as of Feb. 29, 2008, showed
$2,845,847,596 in total assets and $2,429,890,642 in total debts.

(Tropicana Bankruptcy News, Issue No. 4; Bankruptcy Creditors'
Service Inc., http://bankrupt.com/newsstand/or 215/945-7000)


TROPICANA ENT: Endorses AlixPartners LLP as Restructuring Advisors
------------------------------------------------------------------
Tropicana Entertainment LLC and its debtor-affiliates seek
permission from the U.S. Bankruptcy Court for the District of
Delaware to employ AlixPartners LLP as their restructuring
advisors.

The Debtors inform the Court that they require AlixPartners'
experience in providing excellent restructuring advisory services
in large Chapter 11 cases.

AlixPartners will:

   a. assist in developing and monitoring performance of the
      Debtors' business plan and related analyses and
      alternatives;

   b. assist the Debtors and their management in developing and
      monitoring a short-term cash flow which is l3-week cash
      receipts and disbursements forecasting tool and related
      methodologies, and to assist with planning for alternatives
      as requested by the Debtors;

   c. assist the Debtors' management in complying with certain
      bankruptcy administration requirements including, but not
      limited to, filing of schedules and statements; developing
      and producing monthly operating reports; developing a
      database of claims and liabilities as of the filing date;
      and other mutually agreed upon tasks;

   d. assist the Debtors and their management team in
      coordinating and managing the communications and due
      diligence requests with the various constituents during the
      pendency of the Debtors' Chapter II Cases;

   e. assist the Debtors in attempting to meet various current or
      potential compliance obligations, including requirements
      relating to financing agreements, bankruptcy court
      reporting requirements and gaming industry requirements;

   f. assist in obtaining and presenting information required by
      parties in interest in the Debtors' bankruptcy process,
      including official committees appointed by the Court and
      the Court itself;

   g. assist the Debtors with the appropriate entity segregation
      and of reporting for parent and subsidiary entities;

   h. assist, as requested, in tasks like reconciling, managing,
      and negotiating claims, determining preferences, and
      collection of same and similar administrative matters;
      and  

   i. assist with other matters as may be requested that fall
      within AlixPartners' expertise and that are mutually
      agreeable.

AlixPartners' services will be paid in accordance with its
customary hourly rates:

     Professional                  Hourly Rate
     ------------                  -----------
     Managing Directors            $650 to $850
     Directors                     $485 to $650
     Vice Presidents               $335 to $480
     Associates                    $250 to $340
     Analysts                      $225 to $250
     Paraprofessionals             $170 to $200

AlixPartners will also be reimbursed for actual and reasonable
out-of-pocket expenses incurred in connection with the Debtors'
Chapter 11 Cases.

The Debtors paid $303,909 to AlixPartners for services rendered in
preparation of filing their Chapter 11 cases.  The Debtors also
advanced $200,000 to AlixPartners to be applied against fees and
expenses.

John Castellano, a managing partner of AlixPartners, assures the
Court that his firm is a "disinterested person" as the phrase is
defined in Section 10(14) of the Bankruptcy Code.

                About Tropicana Entertainment

Based in Crestview Hills, Kentucky, Tropicana Entertainment LLC --
http://www.tropicanacasinos.com/-- is an indirect subsidiary of   
Tropicana Casinos and Resorts. The company is one of the largest
privately-held gaming entertainment providers in the United
States. Tropicana Entertainment owns eleven casino properties in
eight distinct gaming markets with premier properties in Las
Vegas, Nevada and Atlantic City, New Jersey.

Tropicana Entertainment LLC filed for Chapter 11 protection on
May 5, 2008, (Bankr. D. Del. Case No. 08-10856) Its debtor-
affiliates filed for separate Chapter 11 petitions but with no
case numbers assigned yet. Kirkland & Ellis LLP and Mark D.
Collins, Esq. at Richards Layton & Finger represent the Debtors in
their restructuring efforts. Their financial advisor is Lazard
Ltd. Their notice, claims, and balloting agent is Kurtzman Carson
Consultants LLC.  The Debtors' consolidated financial condition as
of Feb. 29, 2008, showed $2,845,847,596 in total assets and
$2,429,890,642 in total debts.

(Tropicana Bankruptcy News, Issue No. 4; Bankruptcy Creditors'
Service Inc., http://bankrupt.com/newsstand/or 215/945-7000)


TROPICANA ENT: Wants to Hire Ernst & Young as Accounting Advisor
----------------------------------------------------------------
Tropicana Entertainment LLC and its debtor-affiliates seek
permission from the U.S. Bankruptcy Court for the District of
Delaware to employ Ernst & Young LLP as their independent auditor
and accounting advisor in connection with their Chapter 11 cases.

The Debtors relate that they selected Ernst & Young because it is
familiar with their business and financial affairs and because
the firm has extensive experience in and an excellent reputation
for providing high quality auditing and accounting advisory
services to large and complex companies, including debtors and
creditors in bankruptcy reorganization.

The Debtors previously employed Ernst & Young to provide audit
and accounting services.

Ernst & Young will:

   a. conduct annual audit of the consolidated financial
      statements of Tropicana Entertainment, LLC, Columbia
      Properties Vicksburg, LLC, JMBS Casino LLC, and CP Laughlin
      Realty, LLC, for the years ended December 31, 2007 and
      December 31, 2008;

   b. conduct SAS 100 review of Tropicana II Entertainment, LLC,
      Columbia Properties Vickburg, LLC, JMBS Casino LLC, and CP
      Laughlin Realty, LLC;

   c. conduct annual audit of the financial statements of
      Tropicana Las Vegas Resort and Casino, LLC, Aztar Indiana
      Gaming Company, LLC, Greenville Riverboat, LLC, and
      Greenville Riverboat, LLC, and Sargasso Corporation for the
      year ended December 31, 2007;

   d. conduct an annual audit of the financial statements of
      Tropicana Las Vegas Resort and Casino, LLC, Greenville
      Riverboat, LLC, and Sargasso Corporation for the year ended
      December 31, 2008;

   e. conduct audits of any entities as a result of sales
      agreements;

   f. conduct annual audit of the historical basis financial
      statements of Adamar of New Jersey, Inc., for the year
      ended December 31, 2007.

   g. conduct research and consult with management regarding
      financial accounting and reporting matters;

   h. prepare management letter;

   i. conduct audit of and report on the financial statements and
      supplemental schedule of the Aztar Corporation 401(k) Plan,
      for the year ended December 31, 2007, which is to be
      included in the Plan's Form 5500 filing with the Department
      of Labor's Employee Benefits Security Administration; and

   j. conduct various agreed upon procedures under Indiana,
      Nevada, New Jersey, Louisiana, and Mississippi gaming
      regulations, including internal control, audit, and testing
      procedures.

Ernst & Young will be paid for the contemplated services in
accordance with its customary hourly rates:

     Professional                        Hourly Rate
     ------------                        -----------
     National Partner                        $700
     Partner                                 $525
     Executive Director                      $475
     Senior Manager                          $455
     Manager                                 $335
     Senior                                  $210
     Staff                                   $160
     Senior Client Serving Associate         $140

The Debtors will reimburse Ernst & Young for actual expenses
incurred in considering or responding to discovery requests or
participating as a witness in any proceeding with regard to the
audit and accounting advisory services; and reasonable and
customary out-of-pocket expenses.

Steven Beinlich, partner at Ernst & Young, assures the Court that
his firm is a "disinterested person" as the phrase is defined
under Section 10(14) of the Bankruptcy Code.

                About Tropicana Entertainment

Based in Crestview Hills, Kentucky, Tropicana Entertainment LLC --
http://www.tropicanacasinos.com/-- is an indirect subsidiary of   
Tropicana Casinos and Resorts. The company is one of the largest
privately-held gaming entertainment providers in the United
States. Tropicana Entertainment owns eleven casino properties in
eight distinct gaming markets with premier properties in Las
Vegas, Nevada and Atlantic City, New Jersey.

Tropicana Entertainment LLC filed for Chapter 11 protection on
May 5, 2008, (Bankr. D. Del. Case No. 08-10856) Its debtor-
affiliates filed for separate Chapter 11 petitions but with no
case numbers assigned yet. Kirkland & Ellis LLP and Mark D.
Collins, Esq. at Richards Layton & Finger represent the Debtors in
their restructuring efforts.  Their financial advisor is Lazard
Ltd. Their notice, claims, and balloting agent is Kurtzman Carson
Consultants LLC.  The Debtors' consolidated financial condition as
of Feb. 29, 2008, showed $2,845,847,596 in total assets and
$2,429,890,642 in total debts.

(Tropicana Bankruptcy News, Issue No. 4; Bankruptcy Creditors'
Service Inc., http://bankrupt.com/newsstand/or 215/945-7000)


TRUMP ENTERTAINMENT: Harry Hagerty Joins Board of Directors
-----------------------------------------------------------
Harry C. Hagerty has been appointed to Trump Entertainment
Resorts, Inc.'s Board of Directors.

Mr. Hagerty brings to the Board senior level financial and
operational experience at significant corporations, including the
financial and gaming industries.  Most recently, Mr. Hagerty was
Executive Vice President and Chief Financial Officer of Global
Cash Access Holdings, Inc. Prior to that position, he served as
Executive Vice President and Chief Financial Officer of Caesars
Entertainment, Inc.  Mr. Hagerty has also served as Managing
Director of Investment Banking at both BancBoston Robertson
Stephens, Inc. and Deutsche Morgan Grenfell, Inc.

Mr. Hagerty, 47, will serve on the Audit Committee of the Board.
His appointment will be effective upon receipt of required
regulatory approval, and expires at the company's 2010 annual
meeting of stockholders.

Based in Atlantic City, New Jersey, Trump Entertainment Resorts
Inc. (NASDAQ:TRMP) -- http://www.trump.com-- owns and operates
three casino hotel properties: Trump Taj Mahal Casino Resort,
Trump Plaza Hotel and Casino and Trump Marina Hotel Casino.  Trump
Entertainment conducts gaming activities and provides customers
with casino resort and entertainment experiences.  The company is
the successor to Trump Hotels & Casino Resorts Inc. and its
subsidiaries.  During the year ended Dec. 31, 2006 the company
focused on property and operational changes.  It commenced the
first phase of its renovation capital program and began
construction of a 786-room hotel tower at the Trump Taj Mahal.

                         *     *     *

As reported in the Troubled Company Reporter on April 16, 2008,
Moody's Investors Service downgraded Trump Entertainment Resort
Holdings, Inc.'s probability of default rating to Caa1 from B3.   
The company's B3 corporate family rating and Caa1 8.5% senior
secured second lien notes, however, were confirmed.  Concurrently,
TER's speculative grade liquidity rating was raised to SGL-3 from
SGL-4, and a negative ratings outlook was assigned.  This rating
action ends the review process which began on Dec. 17, 2007.


TW HOTEL: Improving Performance Cues Moody's to Lift Ratings
------------------------------------------------------------
Moody's Investors Service upgraded twelve classes, and affirmed
two classes of TW Hotel Funding 2005-LUX as:

  -- Class A1, $108,137,045, Floating, affirmed at Aaa
  -- Class A2, $36,045,682, Floating, affirmed at Aaa
  -- Class B, $18,002,568, Floating, upgraded to Aaa from Aa1
  -- Class C, $21,002,996, Floating, upgraded to Aaa from Aa2
  -- Class D, $10,298,766, Floating, upgraded to Aa1 from Aa3
  -- Class E, $13,785,750, Floating, upgraded to Aa2 from A1
  -- Class F, $14,029,028, Floating, upgraded to Aa3 from A2
  -- Class G, $10,298,766, Floating, upgraded to A1 from A3
  -- Class H, $20,273,162, Floating, upgraded to A2 from Baa1
  -- Class J, $15,731,974, Floating, upgraded to A3 from Baa2
  -- Class K, $21,895,015, Floating, upgraded to Baa1 from Baa3
  -- Class L, $14,596,677, Floating, upgraded to Baa2 from Ba1
  -- Class M, $24,165,609, Floating, upgraded to Baa3 from Ba2
  -- Class N, $16,380,715, Floating, upgraded to Ba1 from Ba3

Moody's is affirming and upgrading the above pooled classes due to
overall improving property performances, release of a property and
value appreciation.

The pooled Certificates are collateralized by a single loan
secured by four properties.  As of the April 15, 2008 distribution
date, the transaction's aggregate certificate balance has
decreased by approximately 19% to $345 million from $425 million
at securitization.  The significant reduction in the aggregate
balance is primarily caused by the April 2007 release of the Kona
Village Resort (13% of the original pooled trust balance)
property.  The repayment was made on a modified pro rata basis.   
Moody's current underlying rating is Ba1 versus Ba3 at
securitization.  Moody's pooled LTV is 66%.

All of the assets in the pool were in various stages of renovation
when they were securitized.  The stabilization process post-
securitization meets Moody's original expectations, and the
release of Kona Village Resort, a highly transitional asset in
nature, benefited the pool.  Furthermore, all of the hotels in the
pool have irreplaceable location, and locations with high barriers
to entry.


UAL CORP: Sets Pricing Alliance with Continental Airlines
---------------------------------------------------------
United Airlines and Continental Airlines Inc. are holding talks to
form an alliance that would set pricing and schedules, Mary
Schlangenstein and John Hughes of Bloomberg News says.  The
alliance discussions went underway shortly after the failed merger
talks between the two airlines, Bloomberg said.

An alliance with U.S. antitrust immunity to collaborate on fares
would provide most of the benefits of a merger, at the same time
avoiding regulatory challenges as well as the need to combine
workforces, Bloomberg notes.

"Antitrust immunity is a kind of quasi-merger," James M. Higgins,
analyst at Soleil Securities Corp., told Bloomberg.  "It doesn't
put you through the actual integration, which is where the cost
savings ultimately can come, but which is also risky, especially
now."

"As we've said over the last few weeks, we are examining our
alliance relationships as we think it's important that we be a
major player in one of the three major global airline alliances,"
Bloomberg quotes Mary Clark, a spokeswoman for Continental, as
saying.

The alliance talks are reportedly separate from United's merger
talks with US Airways.

                 Continental Says "No" to Merger

As reported by the Troubled Company Reporter on April 28, 2008,
Continental Airlines Inc.'s Chairman and CEO Larry Kellner and
President Jeff Smisek disclosed to more than 45,000 employees that
the company's Board of Directors unanimously supported the
management's recommendation that, in the current industry
environment, the best course for Continental is not to merge with
another airline at this time.

According to the two executives, the Board very carefully
considered all the risks and benefits of a merger with another
airline, and determined that the risks of a merger at this time
outweigh the potential rewards, as compared to Continental's
prospects on a standalone basis.  The management will, however,
continue to review potential alliances and its membership in
SkyTeam.  Continental is considering alternatives to SkyTeam as
its carefully evaluates which major global alliance will be best
for Continental over the long term.

                   About Continental Airlines

Continental Airlines Inc. (NYSE: CAL) -- http://continental.com/    
-- is the world's fifth largest airline.  Continental, together
with Continental Express and Continental Connection, has more than
2,900 daily departures throughout the Americas, Europe and Asia,
serving 144 domestic and 139 international destinations.  More
than 500 additional points are served via SkyTeam alliance
airlines.  With more than 45,000 employees, Continental has hubs
serving New York, Houston, Cleveland and Guam, and together with
Continental Express, carries approximately 69 million passengers
per year.

                          *     *     *

As reported in the Troubled Company Reporter on April 22, 2008,
Standard & Poor's Ratings Services revised its rating outlook on
Continental Airlines Inc. (B/Negative/B-3) to negative from
stable.  S&P also placed its ratings on selected enhanced
equipment trust certificates that are secured by regional jets on
CreditWatch with negative implications.

As reported in the Troubled Company Reporter on Dec. 27, 2007,
Fitch Ratings affirmed Continental Airlines 'B-' issuer default
rating with a stable outlook.

                          About UAL Corp.

Based in Chicago, Illinois, UAL Corporation (NASDAQ: UAUA)
-- http://www.united.com/-- is the holding company for United
Airlines, Inc.  United Airlines is the world's second largest
air carrier.  The airline flies to Brazil, Korea and Germany.

The company filed for chapter 11 protection on Dec. 9, 2002
(Bankr. N.D. Ill. Case No. 02-48191).  James H.M. Sprayregen,
Esq., Marc Kieselstein, Esq., David R. Seligman, Esq., and
Steven R. Kotarba, Esq., at Kirkland & Ellis, represented the
Debtors in their restructuring efforts.  Fruman Jacobson, Esq.,
at Sonnenschein Nath & Rosenthal LLP represented the Official
Committee of Unsecured Creditors before the Committee was
dissolved when the Debtors emerged from bankruptcy.

Judge Eugene R. Wedoff confirmed the Debtors' Second Amended Plan
on Jan. 20, 2006.  The company emerged from bankruptcy protection
on Feb. 1, 2006.

(United Airlines Bankruptcy News; Bankruptcy Creditors' Service
Inc., http://bankrupt.com/newsstand/or 215/945-7000).

                            *     *     *

As reported in the Troubled Company Reporter on April 24, 2008,
Standard & Poor's Ratings Services said that its ratings and
outlook on UAL Corp., parent of United Air Lines Inc. (both rated
B/Negative/--) are not affected by UAL's report of a heavy
first-quarter loss.  UAL reported a first-quarter $542 million
pretax loss, as much higher fuel prices more than offset increased
revenues.  S&P had revised its rating outlook on both entities to
negative from stable on April 16, 2008.  In that outlook revision,
S&P cited very high fuel prices and the expected effect on UAL
revenues of a weak U.S. economy.


UAL CORP: Name and Chicago HG Likely to Remain After USAir Merger
-----------------------------------------------------------------
United Airlines Inc., and US Airways Group, Inc. are about to
consolidate, Julie Johnsson of the Chicago Tribune reports.  

The paper, citing a person familiar with the deal, discloses that
the merged company will likely be headquartered in Chicago,
United's base.  However, United's executives are expected to step
aside and let US Airways' CEO Doug Parker and president Scott
Kirby lead the combined carrier, Ms. Johnsson says.

If the merger goes through, public relations and branding experts
believe that United's name would most likely be retained since it
is more established and has a better reputation, Mike Sunnucks of
the Phoenix Business Journal reports.

"United Airlines is larger, and its brand is older and more
established.  It carries longevity and credibility that may
resonate more broadly, particularly in hub markets like
Washington, and Chicago," said Steve Carr, a principal of
Phoenix-based public relations firm, Kur Carr Group Inc.,   
reports Mr. Sunnucks.

Several parties made statements regarding the merger talks,
including Captain Steve Wallach, Chairman of the United Master
Executive Council of the Air Line Pilots Association, and the
Association of Flight Attendants-CWA Master Executive Council
presidents at America West, US Airways and United.

              ALPA Says Merger Should be Last Resort

"We are aware of continued speculation in the media of a possible
merger between United Airlines and US Airways and have serious
concerns that the highly-touted financial benefits to be derived
from such a merger are unlikely to be achieved because these
benefits are based on assumptions that have no basis in reality,"  
Mr. Wallach said.  "We therefore believe that a merger with US
Airways should be a last resort and not a first choice for
United."

"First, much of the financial benefit of a merger occurs because
the merged carrier takes traffic away from other carriers. . . .  
Second, much of the anticipated costs savings from a merger are
expected to come from an 'optimization of the fleet' and the
integration of operations. . . .  Third, the transaction is touted
as providing significant cash to the merged carrier.  However, we
are concerned that continued high fuel costs and the significant
integration costs incurred in a merger could deplete cash reserves
before the benefits of the transaction are realized sometime in
the future."

"We continue to believe that the 'execution risks' are far
greater than assumed.  America West and US Airways have been
unable to integrate after two and a half years, and there is no
solution in sight.  In fact, labor conditions at US Airways have
worsened.  If United and US Airways were to merge, there could
not be any integration of operations until ALPA is recertified
following a new election, and this could take at least a year.
Once recertified, integration of the pilot seniority lists and
negotiation of a new agreement will take at a minimum one and a
half to two years and conceivably as long as four.  Following
integration, full fleet optimization likely will take an
additional one to two years.  In other words, the merger could
take as long as six to seven years, and under the best of
circumstances, at least four years to complete. During this
interim period there would be minimal, if any, cost savings and
financial benefits to the merged entity.

"We also believe that it is unrealistic to assume that the merger
will receive Department of Justice approval. . . .  Moreover, we
believe there [is] a number of operational issues at United that
need to be addressed, and that it is a mistake to sit idly by
waiting for a merger to bail us out. . . .  We also find it
difficult to understand why United is the only carrier in the
industry with no aircraft on order or on option. All these issues
require immediate attention.

". . . .  We are proud to be United pilots and want to do all that
we can to help our airline retain its stature and leadership
position in the industry."

           AFA Says Flight Attendants Should be Supported

Representing more than 21,000 flight attendants, the Association
of Flight Attendants-CWA Master Executive Council presidents --
Greg Davidowitch at United, Mike Flores at US Airways, and Gary
Richardson at America West -- had this to say regarding the
"failed actions of the current management at each airline and the
dangers of multiplying those failures by forcing them under one
roof":

"Labor relations at our carriers is at an all-time low.  US
Airways CEO Doug Parker has failed for almost three years to
negotiate a combined contract with the flight attendants at
America West and US Airways.  While executives have repeatedly
awarded themselves millions in salary and bonuses, America West
and US Airways flight attendants have not received raises or
improvements in working conditions for nearly five years."

"The track record of United Airlines executives is no better.
. . .  These staffing cuts and scheduling practices provide no
benefit and only wreak havoc on passengers' travel experience."

"In order for such an inherently risky and complex business
transaction to be successful, there must be an underlying
rationale and an accord with flight attendants.  To date there is
no evidence of either.  If current management at these companies
expects cooperation in any consolidation scenario, they must
address the needs of flight attendants.

"The problems at our airlines can and should be fixed.  Flight
attendants continue to struggle under the draconian cuts of
bankruptcy and deserve decent wages and work conditions.  Only
when the needs of the employees are met will US Airways and
United Airlines have a chance at being airlines where people want
to work and passengers want to fly.

"In order for any merger to be successful, it will need to have
the support of flight attendants.  We encourage our respective
management teams to first address the problems that have created
this adversarial labor environment before contemplating any kind
of consolidation scenario.  Unless immediate focus is placed on
the outstanding road blocks to success at each of our airlines,
flight attendant issues will become real and significant
obstacles in the path of any merger."

                         About US Airways

Based in Tempe, Arizona, US Airways Group Inc.'s (NYSE: LCC) -
http://www.usairways.com/-- primary business activity is the
ownership of the common stock of US Airways, Inc., Allegheny
Airlines, Inc., Piedmont Airlines, Inc., PSA Airlines, Inc.,
MidAtlantic Airways, Inc., US Airways Leasing and Sales, Inc.,
Material Services Company, Inc., and Airways Assurance Limited,
LLC.

Under a Chapter 11 plan declared effective on March 31, 2003,
USAir emerged from bankruptcy with the Retirement Systems of
Alabama taking a 40% equity stake in the deleveraged carrier in
exchange for $240 million infusion of new capital.

US Airways and its subsidiaries filed another chapter 11 petition
on Sept. 12, 2004 (Bankr. E.D. Va. Case No. 04-13820).  Brian P.
Leitch, Esq., Daniel M. Lewis, Esq., and Michael J. Canning, Esq.,
at Arnold & Porter LLP, and Lawrence E. Rifken, Esq., and Douglas
M. Foley, Esq., at McGuireWoods LLP, represent the Debtors in
their restructuring efforts.  In the Company's second bankruptcy
filing, it lists $8,805,972,000 in total assets and $8,702,437,000
in total debts.

The Debtors' Chapter 11 plan for its second bankruptcy filing
became effective on Sept. 27, 2005.  The Debtors completed their
merger with America West on the same date.  (US Airways Bankruptcy
News, Issue No. 158; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).

                          *     *     *

As reported in the Troubled Company Reporter on March 26, 2008,
Standard & Poor's Ratings Services revised its outlook on US
Airways Group Inc. to stable from positive.  S&P has affirmed all
ratings, including the 'B-' long-term corporate credit rating.

The TCR reported on April 17, 2008, that Fitch Ratings has
affirmed the debt ratings of US Airways Group, Inc. as: Issuer
Default Rating at 'B-'; Secured term loan rating at 'BB-/RR1'; and
Senior unsecured rating at 'CCC/RR6'.  Fitch's ratings apply to
approximately $1.7 billion in outstanding debt.  The Rating
Outlook has been revised to Stable from Positive.

                          About UAL Corp.

Based in Chicago, Illinois, UAL Corporation (NASDAQ: UAUA)
-- http://www.united.com/-- is the holding company for United
Airlines, Inc.  United Airlines is the world's second largest
air carrier.  The airline flies to Brazil, Korea and Germany.

The company filed for chapter 11 protection on Dec. 9, 2002
(Bankr. N.D. Ill. Case No. 02-48191).  James H.M. Sprayregen,
Esq., Marc Kieselstein, Esq., David R. Seligman, Esq., and
Steven R. Kotarba, Esq., at Kirkland & Ellis, represented the
Debtors in their restructuring efforts.  Fruman Jacobson, Esq.,
at Sonnenschein Nath & Rosenthal LLP represented the Official
Committee of Unsecured Creditors before the Committee was
dissolved when the Debtors emerged from bankruptcy.

Judge Eugene R. Wedoff confirmed the Debtors' Second Amended Plan
on Jan. 20, 2006.  The company emerged from bankruptcy protection
on Feb. 1, 2006.

(United Airlines Bankruptcy News; Bankruptcy Creditors' Service
Inc., http://bankrupt.com/newsstand/or 215/945-7000).

                            *     *     *

As reported in the Troubled Company Reporter on April 24, 2008,
Standard & Poor's Ratings Services said that its ratings and
outlook on UAL Corp., parent of United Air Lines Inc. (both rated
B/Negative/--) are not affected by UAL's report of a heavy
first-quarter loss.  UAL reported a first-quarter $542 million
pretax loss, as much higher fuel prices more than offset increased
revenues.  S&P had revised its rating outlook on both entities to
negative from stable on April 16, 2008.  In that outlook revision,
S&P cited very high fuel prices and the expected effect on UAL
revenues of a weak U.S. economy.


US AIRWAYS: Merger Likely to Retain UAL Name and Chicago HG
-----------------------------------------------------------
United Airlines Inc., and US Airways Group, Inc. are about to
consolidate, Julie Johnsson of the Chicago Tribune reports.  

The paper, citing a person familiar with the deal, discloses that
the merged company will likely be headquartered in Chicago,
United's base.  However, United's executives are expected to step
aside and let US Airways' CEO Doug Parker and president Scott
Kirby lead the combined carrier, Ms. Johnsson says.

If the merger goes through, public relations and branding experts
believe that United's name would most likely be retained since it
is more established and has a better reputation, Mike Sunnucks of
the Phoenix Business Journal reports.

"United Airlines is larger, and its brand is older and more
established.  It carries longevity and credibility that may
resonate more broadly, particularly in hub markets like
Washington, and Chicago," said Steve Carr, a principal of
Phoenix-based public relations firm, Kur Carr Group Inc.,   
reports Mr. Sunnucks.

Several parties made statements regarding the merger talks,
including Captain Steve Wallach, Chairman of the United Master
Executive Council of the Air Line Pilots Association, and the
Association of Flight Attendants-CWA Master Executive Council
presidents at America West, US Airways and United.

              ALPA Says Merger Should be Last Resort

"We are aware of continued speculation in the media of a possible
merger between United Airlines and US Airways and have serious
concerns that the highly-touted financial benefits to be derived
from such a merger are unlikely to be achieved because these
benefits are based on assumptions that have no basis in reality,"  
Mr. Wallach said.  "We therefore believe that a merger with US
Airways should be a last resort and not a first choice for
United."

"First, much of the financial benefit of a merger occurs because
the merged carrier takes traffic away from other carriers. . . .  
Second, much of the anticipated costs savings from a merger are
expected to come from an 'optimization of the fleet' and the
integration of operations. . . .  Third, the transaction is touted
as providing significant cash to the merged carrier.  However, we
are concerned that continued high fuel costs and the significant
integration costs incurred in a merger could deplete cash reserves
before the benefits of the transaction are realized sometime in
the future."

"We continue to believe that the 'execution risks' are far
greater than assumed.  America West and US Airways have been
unable to integrate after two and a half years, and there is no
solution in sight.  In fact, labor conditions at US Airways have
worsened.  If United and US Airways were to merge, there could
not be any integration of operations until ALPA is recertified
following a new election, and this could take at least a year.
Once recertified, integration of the pilot seniority lists and
negotiation of a new agreement will take at a minimum one and a
half to two years and conceivably as long as four.  Following
integration, full fleet optimization likely will take an
additional one to two years.  In other words, the merger could
take as long as six to seven years, and under the best of
circumstances, at least four years to complete. During this
interim period there would be minimal, if any, cost savings and
financial benefits to the merged entity.

"We also believe that it is unrealistic to assume that the merger
will receive Department of Justice approval. . . .  Moreover, we
believe there [is] a number of operational issues at United that
need to be addressed, and that it is a mistake to sit idly by
waiting for a merger to bail us out. . . .  We also find it
difficult to understand why United is the only carrier in the
industry with no aircraft on order or on option. All these issues
require immediate attention.

". . . .  We are proud to be United pilots and want to do all that
we can to help our airline retain its stature and leadership
position in the industry."

           AFA Says Flight Attendants Should be Supported

Representing more than 21,000 flight attendants, the Association
of Flight Attendants-CWA Master Executive Council presidents --
Greg Davidowitch at United, Mike Flores at US Airways, and Gary
Richardson at America West -- had this to say regarding the
"failed actions of the current management at each airline and the
dangers of multiplying those failures by forcing them under one
roof":

"Labor relations at our carriers is at an all-time low.  US
Airways CEO Doug Parker has failed for almost three years to
negotiate a combined contract with the flight attendants at
America West and US Airways.  While executives have repeatedly
awarded themselves millions in salary and bonuses, America West
and US Airways flight attendants have not received raises or
improvements in working conditions for nearly five years."

"The track record of United Airlines executives is no better. . .
.  These staffing cuts and scheduling practices provide no benefit
and only wreak havoc on passengers' travel experience."

"In order for such an inherently risky and complex business
transaction to be successful, there must be an underlying
rationale and an accord with flight attendants.  To date there is
no evidence of either.  If current management at these companies
expects cooperation in any consolidation scenario, they must
address the needs of flight attendants.

"The problems at our airlines can and should be fixed.  Flight
attendants continue to struggle under the draconian cuts of
bankruptcy and deserve decent wages and work conditions.  Only
when the needs of the employees are met will US Airways and
United Airlines have a chance at being airlines where people want
to work and passengers want to fly.

"In order for any merger to be successful, it will need to have
the support of flight attendants.  We encourage our respective
management teams to first address the problems that have created
this adversarial labor environment before contemplating any kind
of consolidation scenario.  Unless immediate focus is placed on
the outstanding road blocks to success at each of our airlines,
flight attendant issues will become real and significant
obstacles in the path of any merger."

                          About UAL Corp.

Based in Chicago, Illinois, UAL Corporation (NASDAQ: UAUA)
-- http://www.united.com/-- is the holding company for United
Airlines, Inc.  United Airlines is the world's second largest
air carrier.  The airline flies to Brazil, Korea and Germany.

The company filed for chapter 11 protection on Dec. 9, 2002
(Bankr. N.D. Ill. Case No. 02-48191).  James H.M. Sprayregen,
Esq., Marc Kieselstein, Esq., David R. Seligman, Esq., and
Steven R. Kotarba, Esq., at Kirkland & Ellis, represented the
Debtors in their restructuring efforts.  Fruman Jacobson, Esq.,
at Sonnenschein Nath & Rosenthal LLP represented the Official
Committee of Unsecured Creditors before the Committee was
dissolved when the Debtors emerged from bankruptcy.

Judge Eugene R. Wedoff confirmed the Debtors' Second Amended Plan
on Jan. 20, 2006.  The company emerged from bankruptcy protection
on Feb. 1, 2006.

(United Airlines Bankruptcy News; Bankruptcy Creditors' Service
Inc., http://bankrupt.com/newsstand/or 215/945-7000).

                            *     *     *

As reported in the Troubled Company Reporter on April 24, 2008,
Standard & Poor's Ratings Services said that its ratings and
outlook on UAL Corp., parent of United Air Lines Inc. (both rated
B/Negative/--) are not affected by UAL's report of a heavy
first-quarter loss.  UAL reported a first-quarter $542 million
pretax loss, as much higher fuel prices more than offset increased
revenues.  S&P had revised its rating outlook on both entities to
negative from stable on April 16, 2008.  In that outlook revision,
S&P cited very high fuel prices and the expected effect on UAL
revenues of a weak U.S. economy.

                         About US Airways

Based in Tempe, Arizona, US Airways Group Inc.'s (NYSE: LCC) -
http://www.usairways.com/-- primary business activity is the
ownership of the common stock of US Airways, Inc., Allegheny
Airlines, Inc., Piedmont Airlines, Inc., PSA Airlines, Inc.,
MidAtlantic Airways, Inc., US Airways Leasing and Sales, Inc.,
Material Services Company, Inc., and Airways Assurance Limited,
LLC.

Under a Chapter 11 plan declared effective on March 31, 2003,
USAir emerged from bankruptcy with the Retirement Systems of
Alabama taking a 40% equity stake in the deleveraged carrier in
exchange for $240 million infusion of new capital.

US Airways and its subsidiaries filed another chapter 11 petition
on Sept. 12, 2004 (Bankr. E.D. Va. Case No. 04-13820).  Brian P.
Leitch, Esq., Daniel M. Lewis, Esq., and Michael J. Canning, Esq.,
at Arnold & Porter LLP, and Lawrence E. Rifken, Esq., and Douglas
M. Foley, Esq., at McGuireWoods LLP, represent the Debtors in
their restructuring efforts.  In the Company's second bankruptcy
filing, it lists $8,805,972,000 in total assets and $8,702,437,000
in total debts.

The Debtors' Chapter 11 plan for its second bankruptcy filing
became effective on Sept. 27, 2005.  The Debtors completed their
merger with America West on the same date.  (US Airways Bankruptcy
News, Issue No. 158; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).

                          *     *     *

As reported in the Troubled Company Reporter on March 26, 2008,
Standard & Poor's Ratings Services revised its outlook on US
Airways Group Inc. to stable from positive.  S&P has affirmed all
ratings, including the 'B-' long-term corporate credit rating.

The TCR reported on April 17, 2008, that Fitch Ratings has
affirmed the debt ratings of US Airways Group, Inc. as: Issuer
Default Rating at 'B-'; Secured term loan rating at 'BB-/RR1'; and
Senior unsecured rating at 'CCC/RR6'.  Fitch's ratings apply to
approximately $1.7 billion in outstanding debt.  The Rating
Outlook has been revised to Stable from Positive.


US SHIPPING: S&P Puts 'B-' Rating Under Neg. Watch on Poor Fin'l
----------------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings, including
its 'B-' corporate credit rating, on U.S. Shipping Partners L.P.
on CreditWatch with negative implications.
      
"The CreditWatch placement reflects the company's worse-than-
expected near-term operating outlook, a deteriorating financial
profile, increasing liquidity constraints, and the possibility of
a financial covenant breach over the next several months," said
Standard & Poor's credit analyst Funmi Afonja.  The CreditWatch
also reflects S&P's expectations of continued earnings and cash
flow pressures because of rising fuel prices and increased
exposure to the volatile spot market due to the expiration of
time-charter contracts in recent months.  The Edison, New Jersey-
based shipping company has about $463 million of lease-adjusted
debt.
     
U.S. Shipping's near-term operating outlook is worse-than-
expected.  The company has stated that it is possible that it
could fall out of compliance with certain financial covenants
relating to leverage, fixed-charge, and interest coverage at the
end of the second quarter of 2008, and likely that it will fall
out of compliance with these same covenants by the end of the
third quarter of 2008.  The company has retained financial
advisers to assist in exploring strategic alternatives, including
the possible sale of the business or the sale of new equity, and
other ways to increase liquidity and strengthen the financial
resources of the company.
     
Current ratings on U.S. Shipping reflect the tanker company's
limited free cash flow after partnership distributions; a very
aggressive financial policy; participation in the competitive and
capital-intensive shipping industry; and the modest size of its
fleet of older vessels.  These vessels, which face increasing
competitive pressures from newer vessels, will be phased out over
time because of a legislative mandate that all tankers that
transport oil into U.S. ports be double-hulled by 2015. U.S.
Shipping has placed an order for several new articulated tug
barges, one of which has already been delivered, to replace
existing capacity.  

In addition to the new ATB program, U.S. Shipping created a joint
venture (USS Products Investor LLC) to finance the construction of
nine double-hulled product tankers by NASSCO, a subsidiary of
General Dynamics Corp. U.S. Shipping has the right to buy the new
product tankers from the joint venture as they are built, with the
first delivery expected in the second quarter  of 2009.  Until its
fleet is replaced, U.S. Shipping is likely to face increased
competitive pressures from newer vessels in the marketplace.  
Earnings pressures are further exacerbated by higher labor costs
from recently renegotiated collective bargaining agreements with
its unions.
     
Standard & Poor's will assess the company's operating prospects,
covenant compliance, liquidity, and the decision the company
reaches in exploring its strategic alternatives in resolving the
CreditWatch.  S&P could lower ratings if the company breaches its
financial covenants, if liquidity constraints increase, or if
operating performance further deteriorates.


UTSTARCOM INC: Expects Up to $590MM Revenues in 2008 First Quarter
------------------------------------------------------------------
UTStarcom Inc. disclosed Tuesday preliminary results for its
fiscal first quarter ended March 31, 2008.

The company said that its first quarter revenues are now expected
to be in the range of $580 million to $590 million, compared with
the initial guidance of $500 million to $520 million.  This, the
company says, is attributable to better than expected performance
from the its Personal Communications Division as well as from the
company's core business units.

Revenue in the first quarter of 2007 was $475.9 million.  Gross
margins are now expected to be in the range of 15% to 16% compared
to the initial guidance of approximately 13%.  Gross margins in
the first quarter of 2007 were 15.8%.  The first quarter operating
expenses are now expected to be in the range of $120 million to
$125 million, compared to the initial guidance of $115 million to
$120 million.  The company says that the higher than expected
operating expenses are in part due to unanticipated professional
services expenses.  Operating expenses were $127.5 million in the
first quarter of 2007.

As of March 31, 2008, the company had cash, cash equivalents and
short-term investments of approximately $305.0 million, compared
to $503.0 million as of Dec. 31, 2007.  The debt balance as of
March 31, 2008, was approximately $36.0 million, compared to
$323.0 million as of Dec. 31, 2007.  During the quarter, the
company repaid $289.5 million of convertible notes, including
accrued interest.  The company also benefited from strong cash
flow from operations generated primarily by management of working
capital.

Certain significant items in the first quarter include:

  -- $49.0 million in gains on sale of investments including the
     Gemdale Corporation investment

  -- A net $9.0 million tax benefit primarily due to a change in    
     withholding tax laws in China

"Since announcing our new corporate strategy in September 2007, we
have made a good deal of progress," said Peter Blackmore,  
UTStarcom's president and chief operating officer.  "These
preliminary results reflect that progress, plus we benefited from
some positive one time factors.  There is still a lot of work to
do in our turnaround, but we are on track with where we expected
to be.

The company did not disclose estimated net income or loss.

                       About UTStarcom Inc.

UTStarcom Inc. -- http://www.utstar.com/-- (Nasdaq: UTSI)    
provides IP-based, end-to-end networking solutions and
international service and support.  The company develops,
manufactures and markets its broadband, wireless, and terminal
solutions to network operators in both emerging and established
telecommunications markets worldwide.  UTStarcom was founded in
1991 and is headquartered in Alameda, California.  The company has
research and development centers in the USA, Canada, China, Korea
and India.

As of Dec. 31, 2007, the company's consolidated balance sheet
showed $2.0 billion in total assets, $1.4 billion in total
liabilities, $3.7 million in minority interest in consolidated
subsidiaries, and $618.0 million in total stockholders' equity.

                          *     *     *

As reported in the Troubled Company Reporter on March 31, 2008,
PricewaterhouseCoopers LLP, in San Jose, Calif., expressed
substantial doubt about UTStarcom Inc.'s ability to continue as a
going concern after auditing the company's consolidated financial
statements for the year ended Dec. 31, 2007.  The auditing firm
pointed to the company's recurring net losses, negative cash flows
from and significant debt obligations.


VALERO ENERGY: El Paso Note Assumption Cues S&P to Cut Rating
-------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on the
$15 million unsecured notes due 2012 of Valero Energy Corp.
(BBB/Stable/--) to 'BB-' from 'BBB', reflecting the assumption of
the notes by El Paso Corp. (BB/Positive/--).

Ratings List

Rating Lowered

                                To                  From
                                --                  ----
Valero Energy Corp.
Senior unsecured
  US$15 mil due 2012            BB-                 BBB


VICORP RESTAURANTS: Panel Taps FTI Consulting as Financial Advisor
------------------------------------------------------------------
The Official Committee of Unsecured Creditors in VICORP
Restaurants Inc. and VI Acquisition Corp.'s Chapter 11 cases asks
authority from the U.S. Bankruptcy Court for the District of
Delaware to employ FTI Consulting Inc. as its financial advisor.

FTI Consulting will, among others, render assistance to the
Committee in the review of financial related disclosures required
by the Court, information and analysis regarding the Debtors'
financing, and financial data distributed by the Debtors to
creditors and other parties-in-interest.

Steven Simms, a senior managing director at FTI Consulting, tells
the Court that FTI will seek compensation for $125,000 per month
for the first six months, $100,000 per month for the following 3
months, and $75,000 for after each consecutive month.

In addition, Mr. Simms tells the Court that the firm expects to
receive a completion fee ranging from $350,000 to $500,000.

Mr. Simms assures the Court that the firm does not represent any
interest adverse to the Debtors' estates.

                     About VICORP Restaurants

Based in Denver, Colorado, VICORP Restaurants Inc. --
http://www.vicorpinc.com/-- operates two restaurant concepts      
under proven and well-recognized brands, Village Inn and Bakers
Square.  Founded in 1958, VICORP has 343 restaurants in 25 states,
consisting of 250 company-operated restaurants and 93 franchised
restaurants.  Known for its strong breakfast heritage, Village Inn
has been serving its signature breakfast items like one-of-a-kind
skillet dishes and made-from-scratch pancakes for 50 years. In
addition, Village Inn offers traditional American fare for lunch
and dinner.

The company and its affiliates filed for Chapter 11 protection on
April 3, 2008 (Bankr. D. Del. Lead Case No. 08-10623).  Donna L.
Culver, Esq., at Morris Nichols Arsht & Tunnell, and Kimberly
Ellen Connolly Lawson, Esq., Kurt F. Gwynne, Esq., and Richard A.
Robinson, Esq., at Reed Smith LLP, represents the Debtors in their
restructuring efforts.  The Debtors chose Wells Fargo Trumbull as
their claims, noticing, and balloting agent.

The U.S. Trustee for Region 3, appointed seven members to the
Official Committee of Unsecured Creditors in the Debtors' cases.

When the Debtors filed for protection from their creditors they
listed estimated assets and debts of $100 million to $500 million.


VICORP RESTAURANTS: Taps Morris Nichols as Conflicts Counsel
------------------------------------------------------------
VICORP Restaurants Inc. and VI Acquisition Corp. ask authority
from the U.S. Bankruptcy Court for the District of Delaware to
employ Morris Nichols Arsht and Tunnell LLP as their conflicts
counsel, nunc pro tunc to April 3, 2008.

Morris Nichols will, among others, perform all necessary services
as the conflicts counsel, including representing the Debtors and
providing them with advice, and take all necessary actions to
preserve the Debtors estates.

Derek C. Abbott, Esq., a partner at Morris Nichols, tells the
Court that the firm's professionals bill these hourly rates:

      Partners              $425 - $675
      Associates            $220 - $400
      Paraprofessionals     $180 - $195
      Case Clerks              $120

Mr. Abbott assures the Court that the firm is disinterested as
that term is defined in Section 101(14) of the U.S. Bankruptcy
Code.

                     About VICORP Restaurants

Based in Denver, Colorado, VICORP Restaurants Inc. --
http://www.vicorpinc.com/-- operates two restaurant concepts      
under proven and well-recognized brands, Village Inn and Bakers
Square.  Founded in 1958, VICORP has 343 restaurants in 25 states,
consisting of 250 company-operated restaurants and 93 franchised
restaurants.  Known for its strong breakfast heritage, Village Inn
has been serving its signature breakfast items like one-of-a-kind
skillet dishes and made-from-scratch pancakes for 50 years. In
addition, Village Inn offers traditional American fare for lunch
and dinner.

The company and its affiliates filed for Chapter 11 protection on
April 3, 2008 (Bankr. D. Del. Lead Case No. 08-10623).  Donna L.
Culver, Esq., at Morris Nichols Arsht & Tunnell, and Kimberly
Ellen Connolly Lawson, Esq., Kurt F. Gwynne, Esq., and Richard A.
Robinson, Esq., at Reed Smith LLP, represents the Debtors in their
restructuring efforts.  The Debtors chose Wells Fargo Trumbull as
their claims, noticing, and balloting agent.

The U.S. Trustee for Region 3, appointed seven members to the
Official Committee of Unsecured Creditors in the Debtors' cases.

When the Debtors filed for protection from their creditors they
listed estimated assets and debts of $100 million to $500 million.


VICORP RESTAURANTS: Taps Piper Jaffray as Financial Advisor
-----------------------------------------------------------
VICORP Restaurants Inc. and VI Acquisition Corp. ask authority
from the U.S. Bankruptcy Court for the District of Delaware to
employ Piper Jaffray & Co. as their financial advisor, nunc pro
tunc to April 3, 2008.

Piper Jaffray will, among others, evaluate the Debtors potential
debt capacity in light of existing and prospective cash flows, and
provide assistance to the Debtors regarding marketing processes,
lease sales, and negotiating transactions.

The firm has agreed to receive from the Debtors:

   a) a monthly fee of $100,000;

   b) a cash fee of 1% of the aggregate principal amount of the
      Debtors' credit facilities, which includes their prepetition
      indebtedness;

   c) a financing fee equal to 1% of the aggregate amount of new
      monies provided to the Debtors which exceed $50 million; and

   d) an M&A transaction fee equal to 1% of the transaction value
      paid by a third party.

The Debtors assure the Court that the firm is disinterested as
that term is defined in Section 101(14) of the U.S. Bankruptcy
Code.

                     About VICORP Restaurants

Based in Denver, Colorado, VICORP Restaurants Inc. --
http://www.vicorpinc.com/-- operates two restaurant concepts      
under proven and well-recognized brands, Village Inn and Bakers
Square.  Founded in 1958, VICORP has 343 restaurants in 25 states,
consisting of 250 company-operated restaurants and 93 franchised
restaurants.  Known for its strong breakfast heritage, Village Inn
has been serving its signature breakfast items like one-of-a-kind
skillet dishes and made-from-scratch pancakes for 50 years. In
addition, Village Inn offers traditional American fare for lunch
and dinner.

The company and its affiliates filed for Chapter 11 protection on
April 3, 2008 (Bankr. D. Del. Lead Case No. 08-10623).  Donna L.
Culver, Esq., at Morris Nichols Arsht & Tunnell, and Kimberly
Ellen Connolly Lawson, Esq., Kurt F. Gwynne, Esq., and Richard A.
Robinson, Esq., at Reed Smith LLP, represents the Debtors in their
restructuring efforts.  The Debtors chose Wells Fargo Trumbull as
their claims, noticing, and balloting agent.

The U.S. Trustee for Region 3, appointed seven members to the
Official Committee of Unsecured Creditors in the Debtors' cases.

When the Debtors filed for protection from their creditors they
listed estimated assets and debts of $100 million to $500 million.


VISTEON CORP: Appoints Donald Stebbins as Chief Executive Officer
-----------------------------------------------------------------
The board of directors of Visteon Corporation elected Donald J.
Stebbins as president and chief executive officer, effective
June 1, 2008.  Mr. Stebbins, who was president and chief operating
officer, succeeds Michael F. Johnston in the CEO role.  Mr.
Johnston will continue as executive chairman of the global
automotive supplier.

Mr. Stebbins, 50, has been president and COO since joining Visteon
in 2005, following 13 years in senior leadership positions with
Lear Corp.  Expanding Mr. Stebbins' leadership role is a timely
and logical step in Visteon's long-term executive succession
planning process, according to Mr. Johnston.

"The three-year plan that we launched in 2006 is successfully
positioning Visteon for sustainable success," Mr. Johnston said.  
"As we approach the conclusion of this phase of our
transformation, it's a logical time for Don to assume a greater
role in steering the organization into the future."

As CEO, Mr. Stebbins will lead the development and execution of
Visteon's long-term strategy while continuing to oversee the
company's global operations, sales, manufacturing, product
development, research and development, and customer relations.  
Mr. Stebbins has more than 20 years of leadership experience and a
solid history of performance in managing a global manufacturing
business.  He has served on Visteon's board of directors since
December 2006.

Mr. Johnston, 60, has been chairman and CEO since June 1, 2005.  
He joined Visteon in September 2000 as chief operating officer and
president, and has held the CEO post since June 2004.  Mr.
Johnston has guided Visteon from a North America-focused parts
supplier that was heavily dependent on one automaker, to a global
engineering and manufacturing company with a focused product
portfolio and a diversified customer and geographic base.  As
executive chairman, Mr. Johnston will concentrate on ensuring
company policies and investments align with corporate strategy,
interfacing with the board of directors, and fostering
relationships with key customers and financial stakeholders.

In expanding Mr. Stebbins' responsibilities, Visteon's board cited
his global and financial experience and his success restructuring,
improving and growing Visteon's operations in a challenging market
environment.  "Don's appointment as CEO underscores his proven
leadership and core strengths in global operations and finance,
which have resulted in a more competitive cost structure and
expanded capabilities in fast-growing markets such as the Asia
Pacific region," Mr. Johnston said.

Along with leading Visteon's long-term strategy, Stebbins said his
immediate priorities include successfully completing the remaining
restructuring actions identified in Visteon's three-year plan;
continuing to improve quality, employee safety and efficiency; and
generating profitable new business wins in Visteon's core product
areas.

"We have a tremendously talented and experienced leadership team,"
Mr. Stebbins said.  "Their abilities and energy, coupled with the
strong working relationship that Mike and I have developed, give
me every confidence that Visteon will continue taking positive
steps and delivering on our commitments."

Reporting to Mr. Stebbins will be William G. Quigley III,
executive vice president and chief financial officer; John
Donofrio, senior vice president and general counsel; Robert
Pallash, senior vice president and president, global customer
group; Dorothy L. Stephenson, senior vice president, human
resources; the vice presidents of the three major product groups:
Joy Greenway – climate, Terry Gohl – interiors and lighting, and
Steve Meszaros – electronics; Asaf Farashuddin, vice president,
strategy; Jim Sistek, vice president, information technology; and
Julie Fream, vice president, North American customer group and
global communications.

Mr. Stebbins joined Visteon from Lear Corp., where he was
president and chief operating officer of Lear's operations in
Europe, Asia and Africa.  Previously, he was president and COO of
Lear's operations in the Americas.  Mr. Stebbins joined Lear in
1992 as vice president and treasurer.  He held various financial
positions of increasing responsibility with Lear, including a 1997
promotion to senior vice president and chief financial officer.  
Previously, he held positions at Bankers Trust Company and
Citibank.

Mr. Stebbins holds a bachelor's degree in finance from Miami
University in Oxford, Ohio, where he is also a member of its
Business Advisory Council.  He holds a master's degree in business
administration from the University of Michigan.  He has served on
Visteon's board of directors since December 2006.  Additionally,
he is a member of the board of directors of WABCO Holdings Inc.

Based in Van Buren Township, Michigan, Visteon Corp. (NYSE: VC) --
http://www.visteon.com/-- is a global automotive supplier that       
designs, engineers and manufactures innovative climate, interior,
electronic, and lighting products for vehicle manufacturers, and
also provides a range of products and services to aftermarket
customers.  The company's other corporate offices are in Shanghai,
China; and Kerpen, Germany.  The company has facilities in 26
countries and employs approximately 43,000 people.

Visteon Corporation's balance sheet at March 31, 2008, showed
total assets of $7.2 billion and total liabilities of $7.3 billion
resulting in a total shareholders' deficit of about $136 million.

                           *     *     *

To date, Visteon Corp. holds Moody's Investors Service's Caa2
senior unsecured debt rating, and Fitch Ratings Services' CC
senior unsecured debt rating and CCC long-term issuer default
rating.


WARNEX INC: March 31 Balance Sheet Upside-Down by C$1.3 Million
---------------------------------------------------------------
Warnex Inc. announced on Tuesday its financial results for the
first quarter ended March 31, 2008.

At March 31, 2008, the company's interim consolidated balance
sheet showed C$16.5 million in total assets and C$17.8 million in
total liabilities, resulting in a C$1.3 million total
shareholders' deficit.

The company's interim consolidated balance sheet at March 31,
2008, also showed strained liquidity with C$7.7 million in total
current assets available to pay C$17.7 million total current
liabilities.  

The company reported a net loss of C$286,322 for the three months
ended March 31, 2008, versus a net loss of C$920,907 in the
comparable period a year ago.  For the three-month period ended
March 31, 2008, the net loss from continuing operations amounted
to C$286,322, versus a net loss from continuing operations of
C$383,115 in the comparable period in 2007.

Revenue from continuing operations for the first quarter ended
March 31, 2008, was C$6.1 million, similar to last year's revenue
of C$6.2 million in the first quarter.  

"We are pleased to have delivered solid first quarter results
following the completion of our transition to a company focused on
laboratory services," said Mark Busgang, president and chief
executive officer of Warnex.  

"With the announced agreements in principle for the restructuring
of our debentures and our financing agreement with Desjardins, we
are executing our strategy to reduce our debentures by
C$5.0 million and improve our balance sheet in order to better
position us for future growth opportunities.  We have also
concluded our corporate restructuring and implemented various cost
cuts as we move towards becoming a profitable CRO."

Earnings before interest, taxes, depreciation and amortization
(EBITDA) from continuing operations for the quarter amounted to
C$474,649 versus C$666,670 for the same quarter a year ago.  Total
EBITDA including discontinued operations was C$474,649 for the
quarter compared with C$155,449 in the corresponding quarter in
2007.

Financial expenses decreased by C$163,736, from C$527,761 in the
first quarter of 2007 to C$364,025 in the first quarter of 2008,
mainly due to less interest following repayments made on the long
term debt and debentures.

As of March 31, 2008, the company had C$1.8 million in cash and
working capital deficiency of C$10.0 million since the long term
debentures mature on June 25, 2008, and July 9, 2008.  The
debenture holders have agreed to restructure the debt as announced
on March 19, 2008.

                        About Warnex Inc.

Warnex Inc. (TSX: WNX) -- http://www.warnex.ca/-- provides   
laboratory services to the pharmaceutical and healthcare sectors.
Warnex's analytical services division provides pharmaceutical and
biotechnology companies with a variety of quality control
services, including traditional chemistry, chromatography,
microbiology, method development and validation, and stability
studies.  

Warnex's bioanalytical services division specializes in
bioequivalence and bioavailability studies for clinical trials.
Warnex's medical laboratories division focuses on genetic and
biochemical testing for the healthcare industry and has extensive
expertise in genetic testing for human identification, molecular
diagnostics, and pharmacogenetics.


WELLMAN INC: Gets Extension on Deadline for Auction Protocol
------------------------------------------------------------
Wellman, Inc., ands its debtor-affiliates said that their debtor-
in-possession lenders have granted a one-week extension on its
deadline to have a sale bidding procedures approved by the U.S.
Bankruptcy Court for the Southern District of New York.

As reported in the Troubled Company Reporter on April 11, 2008,
the Court approved the $225,000,000 of DIP Financing from a group
of lenders; Deutsche Bank Securities Inc., as lead arranger and
bookrunner; Deutsche Bank Trust Company Americas, as
administrative agent; JPMorgan Chase Bank, N.A., as syndication
agent; and General Electric Capital Corp., LaSalle Business
Credit, LLC, and Wachovia Finance Corp., as co-documentation
agents.  The Credit Agreement dated Feb. 26, 2008, required the
Debtors to:

   (i) obtain within 90 days after the Petition Date an order
       from the Bankruptcy Court (a) approving bidding
       procedures, (b) scheduling bidding deadline, auction date
       and sale hearing date, and (c) establishing procedures
       under Sections 364 and 365 of the Bankruptcy Code for the
       Wellman Sale and the assignment and assumption of certain
       contracts related thereto;

  (ii) obtain an order approving the Wellman Sale by July 31,
       2008; and

(iii) close the sale within 15 days of the later of (i) the
       entry of the Sale Order, and, if a stay of the order is
       pending, the date the order becomes final and
       non-appealable, if during the time of the stay, a bond has
       been issued.

Wellman says that, in consultation with its stakeholders, it is
evaluating offers and restructuring alternatives, including a
plan of reorganization, in an effort to maximize the value of
Wellman's business on a going concern basis.  "In order to allow
us to maximize value for all of our stakeholders, the DIP lenders
have agreed to provide us additional time to continue discussions
with interested parties."  With the extension, the deadline to
obtain Court-approval of the bidding procedures is extended from
May 22 to May 29.

The letter agreement, which provides for the extension, does not
not amend the other events of default under the Credit Agreement.
Hence, the July 31 deadline to obtain Court approval of the Sale
remains in place.

Headquartered in Fort Mill, South Carolina, Wellman Inc. --
http://www.wellmaninc.com/-- manufactures and markets
packaging and engineering resins used in food and beverage
packaging, apparel, home furnishings and automobiles.  They
manufacture resins and polyester staple fiber a three major
production facilities.

The company and its debtor-affiliates filed for Chapter 11
protection on Feb. 22, 2008 (Bankr. S.D. N.Y. Case No. 08-10595).   
Jonathan S. Henes, Esq., at Kirkland & Ellis, LLP, in New York
City, represents the Debtors.

Wellman Inc., in its bankruptcy petition, listed total assets
of $124,277,177 and total liabilities of $600,084,885, as of
Dec. 31, 2007, on a stand-alone basis.  Debtor-affiliate ALG,
Inc., listed assets between $500 million and $1 billion on a
stand-alone basis at the time of the bankruptcy filing.  
Debtor-affiliates Fiber Industries Inc., Prince Inc., and
Wellman of Mississippi Inc., listed assets between $100 million
and $500 million at the time of their bankruptcy filings.

On a consolidated basis, Wellman Inc., and its debtor-affiliates
listed $498,867,323 in assets and $684,221,655 in liabilities as
of Jan. 31, 2008.

(Wellman Bankruptcy News, Issue No. 12; Bankruptcy Creditors'
Service Inc., http://bankrupt.com/newsstand/or 215/945-7000)  


WELLMAN INC: Wants Court to Extend Deadline to Remove Actions
-------------------------------------------------------------
Wellman Inc. and its debtor-affiliates ask the U.S. Bankruptcy
Court for the Southern District of New York to extend the period
within which they may remove actions, through and including the
later of:

   (a) Aug. 25, 2008,

   (b) 30 days after an order terminating the automatic stay with
       respect to the particular action sought to be removed, or

   (c) with respect to Postpetition Actions, the time periods
       under Rule 9027(a)(3).

The Debtors believe that the proposed extension of the removal
period will provide them with additional time to allow them to
consider, and make decisions concerning, the removal of the
Actions.  Unless the requested extension is granted, the Debtors
contend that they will not have sufficient time to consider
adequately if removal of any of Actions is necessary.

Mr. Henes assures the Court that the rights of any party to the
Actions will not be prejudiced by the requested extension because
those Actions will not be proceeding in their respective courts
even absent the requested extension.  Moreover, if the Debtors
seek to remove any Action pursuant to Bankruptcy Rule 9027, any
party to the litigation can seek to have that Action remanded.

The Court will convene a hearing on May 20, 2008, at 12:00 p.m.,
to consider the Debtors' request.

Rule 9027(a)(2) of the Federal Rules of Bankruptcy Procedure
provides that if a claim or cause of action in a civil action is
pending when a case under the Bankruptcy Code is commenced, a
notice of removal may be filed in the bankruptcy court only
within:

   (a) 90 days after the order for relief in the case,

   (b) 30 days after entry of an order terminating a stay under
       Section 362 of the Bankruptcy Code, or

   (c) 30 days after a trustee qualifies in the Chapter 11 case,
       but not later than 180 days after the order for relief.

Bankruptcy Rule 9006 permits the Court to extend the period
provided by Rule 9027, provided that a request for extension is
made before the applicable deadline.

With respect to postpetition actions, Bankruptcy Rule 9027(a)(3)
provides for removal only within the shorter of:

   (i) 30 days after receipt, through service or otherwise, of a
       copy of the initial pleading detailing the claim or cause
       of action sought to be removed, or

  (ii) 30 days after receipt of the summons if the initial
       pleading has been filed with the Court but not served with
       the summons.

Jonathan S. Henes, Esq., at Kirkland & Ellis LLP, in New York,
tells the Court that the Debtors are a party to numerous lawsuits
pending in various state and federal courts, and are represented
by many different law firms in each of those lawsuits.
Moreover, additional actions may be filed against the Debtors.

Mr. Henes relates that since the Petition Date, the Debtors and
their professionals have been focusing on:

   (a) preparing and filing their schedules of assets and
       liabilities and statements of financial affairs,which is a
       time-consuming undertaking given the Debtors' size,
       complexity, and limited personnel;

   (b) responding to the Official Committee of Unsecured
       Creditors' numerous due diligence requests from the
       Debtors' stakeholders;

   (c) obtaining final approval of the Debtors' postpetition
       financing arrangement and stabilizing their business
       operations; and

   (e) conducting a marketing process to test the viability of
       selling substantially all of the Debtors' assets.

As a result, the Debtors have not been in a position to undertake
a thorough analysis of the Actions and develop a strategy with
respect to whether they should remove certain Actions, asserts
Mr. Henes.

Headquartered in Fort Mill, South Carolina, Wellman Inc. --
http://www.wellmaninc.com/-- manufactures and markets
packaging         
and engineering resins used in food and beverage packaging,
apparel, home furnishings and automobiles.  They manufacture
resins and polyester staple fiber a three major production
facilities.

The company and its debtor-affiliates filed for Chapter 11
protection on Feb. 22, 2008 (Bankr. S.D. N.Y. Case No. 08-10595).   
Jonathan S. Henes, Esq., at Kirkland & Ellis, LLP, in New York
City, represents the Debtors.

Wellman Inc., in its bankruptcy petition, listed total assets
of $124,277,177 and total liabilities of $600,084,885, as of
Dec. 31, 2007, on a stand-alone basis.  Debtor-affiliate ALG,
Inc., listed assets between $500 million and $1 billion on a
stand-alone basis at the time of the bankruptcy filing.  
Debtor-affiliates Fiber Industries Inc., Prince Inc., and
Wellman of Mississippi Inc., listed assets between $100 million
and $500 million at the time of their bankruptcy filings.

On a consolidated basis, Wellman Inc., and its debtor-affiliates
listed $498,867,323 in assets and $684,221,655 in liabilities as
of Jan. 31, 2008.

(Wellman Bankruptcy News, Issue No. 12; Bankruptcy Creditors'
Service Inc., http://bankrupt.com/newsstand/or 215/945-7000)


* Fitch: Most Subprime-Related Bank Losses Are Already Disclosed
----------------------------------------------------------------
Fitch Ratings says global banks have already written down more
than 80% of their losses from subprime mortgage assets. In a
special report published today, the agency estimates total market
losses from subprime mortgage assets at USD400 billion, though
estimates may be as high as USD550 billion, depending on the
method of calculation used.  Approximately 50% of these losses,
USD200 billion to USD275 billion, are held by banks, with the
remainder held by financial guarantors, insurance companies, asset
managers and hedge funds.

As of May 2008, Fitch estimates disclosed losses by banks on
subprime residential mortgage-backed securities (RMBS) or
collateralised debt obligations referencing mortgage-backed
securities (ABS-CDOs) to be USD165 billion, or 83% of the banks'
portion of the losses.

"Subprime mortgage-related losses for the total market vary
considerably depending on the methodology used," says Krishnan
Ramadurai, Managing Director in Fitch's Financial Institutions
Group. "Given the problems associated with methods of calculation
based on ABX and TABX indices, we believe that Fitch's internal
loss estimate of USD400 billion is a more appropriate reflection
of losses though they are also sensitive to assumptions made on
underlying loss rates."

"To the extent that institutions have effectively hedged their
exposures with financially sound counterparties, these loss
figures may be over-estimated," says Gerry Rawcliffe, Managing
Director and Group Credit Officer for Fitch's Financial
Institutions Group. "Nevertheless, for those institutions that did
not hedge a sufficient portion of their super-senior exposures,
mark-to-market losses on these residual exposures have been so
large that their capital ratios have come under acute stress."

The subprime market originated as much as USD1.4trn of loans in
the last three years, Fitch estimates.

The report "Subprime Mortgage-Related Losses - A Moving Target" is
available on the agency's subscription at
http://www.fitchresearch.com/


* S&P Downgrades Ratings on 169 Classes from 38 RMBS Transactions
-----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on 169
classes from 38 residential mortgage-backed securities
transactions backed by U.S. subprime mortgage loan collateral
issued in 2007.  At the same time, S&P removed 142 of the lowered
ratings from CreditWatch with negative implications.  In addition,
S&P affirmed its ratings on 229 classes from 55 RMBS transactions
backed by U.S. subprime loans and removed them from CreditWatch
negative.
     
The downgrades reflect our opinion that projected credit support
for the affected classes is insufficient to maintain the previous
ratings, given S&P's current projected losses.  As announced in
"Projected Losses For U.S. Subprime RMBS Issued In 2006 And First-
Half 2007 As Of April 24, 2008," published April 24, 2008, on
RatingsDirect, S&P calculated its projected deal-specific losses
by reviewing the individual loan-level characteristics and most
recent performance data, as described in "S&P Revises Projected
Losses For U.S. Subprime RMBS Transactions Issued In First-Half
2007," which S&P published April 24, 2008, on RatingsDirect.  Due
to current market conditions, S&P are assuming that it will take
approximately 15 months to liquidate loans in foreclosure and
approximately eight months to liquidate loans categorized as
real estate owned.  In addition, S&P are assuming a loss severity
of approximately 45% for U.S. subprime RMBS transactions issued in
2007.
     
The lowered ratings reflect S&P's assessment of credit support
under three constant prepayment rate scenarios.  The first
scenario utilizes the lower of the lifetime or 12-month CPR, while
the second utilizes a 6% CPR, which is very slow by historical
standards.  The third scenario uses a prepayment rate that is
equal to two times the lower of the lifetime or 12-month CPR.  S&P
incorporated a third CPR scenario into our cash flow analysis
to account for potential increases in prepayments, which may occur
from normal increases typically found in the seasoning of pools
combined with a chance that governmental proposals, if adopted,
may lead to increased CPRs.  

S&P assumed a constant default rate for each pool.  Because the
analysis focused on each individual class with varying maturities,
prepayment scenarios may cause an individual class or the
transaction itself to prepay in full before it incurs the entire
loss projection.  Slower prepayment assumptions lengthen the
average life of the mortgage pool, which increases the likelihood
that total projected losses will be realized.  The longer a class
remains outstanding, however, the more excess spread it generates.
     
Standard & Poor's has updated its projected excess spread to
account for the recent cuts in U.S. interest rates.  Standard &
Poor's recently announced that it will discount a portion of
excess spread to account for potential interest rate modifications
in an upwardly sloping mortgage rate environment.  An interest
rate modification may extend the initial fixed-rate period of a
mortgage loan to five years from two and three years.  The
reduction in interest rates has effectively extended the initial
interest rates beyond the interest rate reset period.  As a result
of the reduction in excess spread, many loan modifications may no
longer be needed.  Standard & Poor's has updated its assumptions
on excess spread to reflect the current environment.
     
To assess the creditworthiness of each class, S&P reviewed the
individual delinquency and loss trends of each transaction for
changes, if any, in risk characteristics, servicing, and the
ability to withstand additional credit deterioration.  For
mortgage pools that are continuing to show increasing
delinquencies, S&P increased its cash flow stresses to account for
potential increases in monthly losses.  

In order to maintain a rating higher than 'B', a class had to
absorb losses in excess of the base case assumption S&P assumed in
its analysis.  For example, a class may have to withstand 115% of
its base case loss assumption in order to maintain a 'BB' rating,
while a different class may have to withstand 125% of its base
case loss assumption to maintain a 'BBB' rating.  Each class that
has an affirmed 'AAA' rating can withstand approximately 150% of
our base case loss assumptions under our analysis, subject to
individual caps assumed on specific transactions.  S&P determined
the caps by limiting the amount of remaining defaults to 90% of
the current pool balances.
     
A combination of subordination, excess spread, and
overcollateralization provide credit support for the affected
transactions.  The underlying collateral for these deals consists
of fixed- and adjustable-rate U.S. subprime mortgage loans that
are secured by first and second liens on one- to four-family
residential properties.
     
To date, including the classes listed below and actions on both
publicly and confidentially rated classes, S&P have resolved the
CreditWatch placements of the ratings on 2,836 classes from 475
U.S. RMBS subprime transactions from the 2006 and 2007 vintages.  
Currently, S&P's ratings on 320 classes from 53 U.S. subprime RMBS
transactions from the 2006 and 2007 vintages are on CreditWatch
negative.

                         Ratings Lowered

    Ace Securities Corp Home Equity Loan Trust Series 2007-HE4
                         Series 2007-HE4

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           M-7        00442LAM1     CC             CCC
           M-8        00442LAN9     CC             CCC
           M-9        00442LAP4     CC             CCC

   ACE Securities Corp. Home Equity Loan Trust, Series 2007-HE5
                         Series 2007-HE5

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           M-8        000797AN0     CC             CCC
           M-9        000797AP5     CC             CCC

Asset Backed Securities Corporation Home Equity Loan Trust Series
                   AMQ 2007-HE2 Series 2007-HE2

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           M9         04544TAP6     CC             CCC

                  BNC Mortgage Loan Trust 2007-3
                           Series 2007-3

                                         Rating
                                         ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           B2         05568QAT2     CC             CCC

                      GSAMP Trust 2007-NC1
                        Series 2007-NC1

                                         Rating
                                         ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           B-2        3622MGAU2     CC             CCC

                   Home Equity Asset Trust 2007-1
                            Series 2007-1

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           B-1        43710LAP9     CC             CCC
           B-2        43710LAQ7     CC             CCC
           B-3        43710LAR5     CC             CCC

               Lehman ABS Mortgage Loan Trust 2007-1
                          Series 2007-1

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           M10        52521MAQ5     CC             CCC
           M11        52521MAR3     CC             CCC

            MASTR Asset Backed Securities Trust 2007-HE1
                          Series 2007-HE1

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         ---            ----
           M-12       576457AR6     CC             CCC

  Merrill Lynch First Franklin Mortgage Loan Trust, Series 2007-4
                           Series 2007-4

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           B3         59025CAS9     CC             CCC

         Morgan Stanley ABS Capital I Inc. Trust 2007-NC2
                          Series 2007-NC2

                                         Rating
                                         ------
          Class      CUSIP         To             From
          -----      -----         --             ----
          B-3        61753NAQ3     CC             CCC

             Natixis Real Estate Capital Trust 2007-HE2
                          Series 2007-HE2

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           B-2        638728AM7     CC             CCC
           B-3        638728AN5     CC             CCC
           B-4        638728AP0     CC             CCC

Nomura Home Equity Loan, Inc. Home Equity Loan Trust Series 2007-3
                         Series 2007-3

                                         Rating
                                         ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           M-8        65537NAN4     CC             CCC
           M-9        65537NAP9     CC             CCC

               Option One Mortgage Loan Trust 2007-4
                          Series 2007-4

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           M-9        68403FAP1     CC             CCC

              Option One Mortgage Loan Trust 2007-CP1
                         Series 2007-CP1

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           M-8        68402YAM8     CC             CCC
           M-9        68402YAN6     CC             CCC

      Securitized Asset Backed Receivables LLC Trust 2007-BR2
                         Series 2007-BR2

                                         Rating
                                         ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           B-3        81378PAL2     CC             CCC

               Soundview Home Loan Trust 2007-OPT1
                         Series 2007-OPT1

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           M-10       83612TAQ5     CC             CCC

    Structured Asset Securities Corporation Mortgage Loan Trust
                     2007-BC3 Series 2007-BC3

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           B2         86363WAZ2     CC             CCC

       Ratings Lowered and Removed from Creditwatch Negative

     Ace Securities Corp Home Equity Loan Trust Series 2007-HE4
                         Series 2007-HE4

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           A-1        00442LAA7     BBB            AAA/Watch Neg
           A-2C       00442LAD1     A              AAA/Watch Neg
           A-2D       00442LAE9     BBB            AAA/Watch Neg
           M-1        00442LAF6     BB             AA+/Watch Neg
           M-2        00442LAG4     B+             AA+/Watch Neg
           M-3        00442LAH2     B              AA+/Watch Neg
           M-4        00442LAJ8     B-             AA/Watch Neg

  ACE Securities Corp. Home Equity Loan Trust, Series 2007-ASAP2
                        Series 2007-ASAP2

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           M-1        00442UAF6     BBB            AA+/Watch Neg
           M-2        00442UAG4     BB             AA+/Watch Neg
           M-3        00442UAH2     B+             AA/Watch Neg
           M-4        00442UAJ8     B              AA/Watch Neg
           M-5        00442UAK5     B-             AA-/Watch Neg

   ACE Securities Corp. Home Equity Loan Trust, Series 2007-HE5
                         Series 2007-HE5

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           A-1        000797AA8     BB             AAA/Watch Neg
           A-2C       000797AD2     A              AAA/Watch Neg
           A-2D       000797AE0     BB             AAA/Watch Neg
           M-1        000797AF7     B+             AA+/Watch Neg
           M-2        000797AG5     B              AA/Watch Neg
           M-3        000797AH3     B-             AA/Watch Neg

    Asset Backed Securities Corporation Home Equity Loan
Trust,               
                        Series AMQ 2007-HE2
                          Series 2007-HE2

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           A1         04544TAA9     BBB            AAA/Watch Neg
           A4         04544TAD3     AA             AAA/Watch Neg
           A5         04544TAE1     BBB            AAA/Watch Neg
           M1         04544TAF8     B              AA+/Watch Neg
           M2         04544TAG6     B-             AA/Watch Neg

                   BNC Mortgage Loan Trust 2007-2
                            Series 2007-2

                                         Rating
                                         ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           M2         05569QAG9     BBB            AA/Watch Neg

                  BNC Mortgage Loan Trust 2007-3
                           Series 2007-3

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           M1         05568QAF2     BBB            AA+/Watch Neg
           M2         05568QAG0     B              AA/Watch Neg
           M3         05568QAH8     B-             B/Watch Neg

                     C-Bass 2007-CB5 Trust
                       Series 2007-CB5

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           M-2        12464YAE9     A              AA/Watch Neg
           M-3        12464YAF6     BB             AA-/Watch Neg

              Citigroup Mortgage Loan Trust 2007-AHL3
                         Series 2007-AHL3

                                         Rating
                                         ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           M-1        17312GAD3     AA             AA+/Watch Neg
           M-2        17312GAE1     BBB            AA/Watch Neg
           M-3        17312GAF8     BB             AA-/Watch Neg

              Citigroup Mortgage Loan Trust 2007-AMC4
                         Series 2007-AMC4

                                         Rating
                                         ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           M-2        17313BAG6     BBB            AA/Watch Neg

           CWABS Asset-Backed Certificates Trust 2007-1
                         Series 2007-1

                                         Rating
                                         ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           M-2        23245CAG5     A              AA/Watch Neg

           CWABS Asset-Backed Certificates Trust 2007-BC2
                          Series 2007-BC2

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           M-2        12669QAG4     A              AA/Watch Neg

             Equifirst Loan Securitization Trust 2007-1
                           Series 2007-1

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           M-2        29445UAE5     A              AA/Watch Neg
           M-3        29445UAF2     BBB            AA-/Watch Neg

                       GSAMP Trust 2007-NC1
                         Series 2007-NC1

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           M-1        3622MGAF5     BBB            A+/Watch Neg

                  Home Equity Asset Trust 2007-1
                           Series 2007-1

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           1-A-1      43710LAA2     A              AAA/Watch Neg
           2-A-3      43710LAD6     AA             AAA/Watch Neg
           2-A-4      43710LAE4     A              AAA/Watch Neg
           M-1        43710LAF1     BB             AA+/Watch Neg
           M-2        43710LAG9     B              AA+/Watch Neg
           M-3        43710LAH7     B-             AA-/Watch Neg

                  Home Equity Asset Trust 2007-3
                            Series 2007-3

                                         Rating
                                         ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           M-2        43710TAG2     AA             AA+/Watch Neg
           M-3        43710TAH0     A              AA+/Watch Neg
           M-4        43710TAJ6     BBB            AA/Watch Neg

        HSI Asset Securitization Corporation Trust 2007-HE2
                        Series 2007-HE2

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           M-1        40430RAF3     AA             AA+/Watch Neg
           M-2        40430RAG1     BBB            AA/Watch Neg
           M-4        40430RAJ5     B              BB/Watch Neg
           M-5        40430RAK2     B-             B/Watch Neg

         HSI Asset Securitization Corporation Trust 2007-NC1
                          Series 2007-NC1

                                           Rating  
                                           ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            A-3        40430TAC6     A              AAA/Watch Neg
            A-4        40430TAD4     BBB            AAA/Watch Neg
            M-1        40430TAE2     BB             AA+/Watch Neg
            M-2        40430TAF9     B+             AA+/Watch Neg
            M-3        40430TAG7     B              AA/Watch Neg
            M-4        40430TAH5     B-             AA/Watch Neg

            JPMorgan Mortgage Acquisition Trust 2007-CH3
                          Series 2007-CH3

                                           Rating
                                           ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            M-2        46630XAH1     BBB            AA/Watch Neg

              Lehman ABS Mortgage Loan Trust 2007-1
                          Series 2007-1

                                          Rating
                                          ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            1-A1       52521MAA0     BBB            AAA/Watch Neg
            2-A3       52521MAD4     AA             AAA/Watch Neg
            2-A4       52521MAE2     BBB            AAA/Watch Neg
            M1         52521MAF9     B+             AA+/Watch Neg
            M2         52521MAG7     B              AA/Watch Neg

            MASTR Asset Backed Securities Trust 2007-HE1
                           Series 2007-HE1

                                         Rating
                                         ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           M-2        576457AF2     BBB            AA/Watch Neg

Merrill Lynch First Franklin Mortgage Loan Trust, Series 2007-2
                          Series 2007-2

                              Rating
            Class      CUSIP         To             From
            -----      -----         --             ----
            A-1        59024QAA8     A              AAA/Watch Neg
            A-2C       59024QAD2     A              AAA/Watch Neg
            A-2D       59024QAE0     A              AAA/Watch Neg
            M-1        59024QAF7     BB             AA+/Watch Neg
            M-2        59024QAG5     B+             AA/Watch Neg

  Merrill Lynch First Franklin Mortgage Loan Trust, Series 2007-4
                         Series 2007-4

                                          Rating
                                          ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            1-A        59025CAA8     BBB            AAA/Watch Neg
            2-A3       59025CAD2     A+             AAA/Watch Neg
            2-A4       59025CAE0     BBB            AAA/Watch Neg
            1-M1       59025CAF7     BB             AA+/Watch Neg
            2-M1       59025CAG5     BB             AA+/Watch Neg
            1-M2       59025CAH3     B+             AA/Watch Neg
            2-M2       59025CAJ9     B+             AA/Watch Neg

      Merrill Lynch Mortgage Investors Trust, Series 2007-MLN1
                         Series 2007-MLN1

                                         Rating
                                         ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           M-2        59024UAG6     A              AA/Watch Neg

         Morgan Stanley ABS Capital I Inc. Trust 2007-HE5
                         Series 2007-HE5

                                          Rating
                                          ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            A-1        61753KAA4     AA             AAA/Watch Neg
            A-2d       61753KAE6     AA             AAA/Watch Neg
            M-1        61753KAF3     A              AA+/Watch Neg
            M-2        61753KAG1     BB             AA/Watch Neg
            M-3        61753KAH9     B+             BB/Watch Neg

          Morgan Stanley ABS Capital I Inc. Trust 2007-NC2
                         Series 2007-NC2

                                         Rating
                                         ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           A-2d       61753NAF7     AA             AAA/Watch Neg
           M-1        61753NAG5     BB             AA+/Watch Neg
           M-2        61753NAH3     B              AA/Watch Neg

             Natixis Real Estate Capital Trust 2007-HE2
                           Series 2007-HE2

                                         Rating
                                         ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           A-2        638728AB1     AA             AAA/Watch Neg
           A-3        638728AC9     BBB            AAA/Watch Neg
           A-4        638728AD7     BB             AAA/Watch Neg
           M-1        638728AE5     B              AA+/Watch Neg
           M-2        638728AF2     B-             AA-/Watch Neg

Nomura Home Equity Loan, Inc. Home Equity Loan Trust Series 2007-3
                          Series 2007-3

                                           Rating
                                           ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            I-A-1      65537NAA2     BBB            AAA/Watch Neg
            II-A-3     65537NAD6     BBB            AAA/Watch Neg
            II-A-4     65537NAE4     BBB            AAA/Watch Neg
            M-1        65537NAF1     BB             AA+/Watch Neg
            M-2        65537NAG9     B+             AA+/Watch Neg
            M-3        65537NAH7     B              AA/Watch Neg
            M-4        65537NAJ3     B-             AA-/Watch Neg

               Option One Mortgage Loan Trust 2007-4
                            Series 2007-4

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           I-A-1      68403FAA4     A              AAA/Watch Neg
           II-A-3     68403FAD8     AA             AAA/Watch Neg
           II-A-4     68403FAE6     A              AAA/Watch Neg
           M-1        68403FAF3     BB             AA+/Watch Neg
           M-2        68403FAG1     B              AA/Watch Neg

              Option One Mortgage Loan Trust 2007-CP1
                         Series 2007-CP1

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           M-1        68402YAE6     BBB            AA+/Watch Neg
           M-2        68402YAF3     BB             AA-/Watch Neg

                    RAMP Series 2007-RS2 Trust
                         Series 2007-RS2

                                          Rating
                                          ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            A-2        75157DAB0     AA             AAA/Watch Neg
            A-3        75157DAC8     A              AAA/Watch Neg
            M-1        75157DAD6     BB             AA+/Watch Neg
            M-2        75157DAE4     B+             AA/Watch Neg
            M-3        75157DAF1     B              AA-/Watch Neg

                     RASC Series 2007-KS2 Trust
                          Series 2007-KS2

                                          Rating
                                          ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            M-1        74924WAF4     A              AA+/Watch Neg
            M-2        74924WAG2     B              AA/Watch Neg

      Securitized Asset Backed Receivables LLC Trust 2007-BR2
                          Series 2007-BR2

                                         Rating
                                         ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           A-1        81378PAA6     BBB            AAA/Watch Neg
           A-2        81378PAB4     BBB            AAA/Watch Neg
           M-1        81378PAC2     B+             AA+/Watch Neg
           M-2        81378PAD0     B              AA/Watch Neg
           M-3        81378PAE8     B-             AA/Watch Neg

               SG Mortgage Securities Trust 2007-NC1
                           Series 2007-NC1

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           A-1        78420RAA6     AA             AAA/Watch Neg
           A-2        78420RAB4     AA             AAA/Watch Neg
           M-1        78420RAC2     BB             AA+/Watch Neg
           M-2        78420RAD0     B+             AA/Watch Neg
           M-3        78420RAE8     B              AA/Watch Neg
           M-4        78420RAF5     B-             B/Watch Neg

                Soundview Home Loan Trust 2007-OPT1
                         Series 2007-OPT1

                                           Rating
                                           ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            I-A-1      83612TAA0     AA             AAA/Watch Neg
            II-A-4     83612TAE2     AA             AAA/Watch Neg
            M-1        83612TAF9     BBB            AA+/Watch Neg
            M-2        83612TAG7     B+             AA/Watch Neg
            M-3        83612TAH5     B              AA-/Watch Neg

    Structured Asset Securities Corporation Mortgage Loan Trust
                             2007-BC3
                          Series 2007-BC3

                                          Rating
                                          ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            1-A4       86363WAD1     AA             AAA/Watch Neg
            2-A4       86363WAH2     AA             AAA/Watch Neg
            1-M1       86363WAJ8     BB             AA+/Watch Neg
            2-M1       86363WAK5     BB             AA+/Watch Neg
            1-M2       86363WAL3     B              AA/Watch Neg
            2-M2       86363WAM1     B              AA/Watch Neg

    Structured Asset Securities Corporation Mortgage Loan Trust
                               2007-EQ1
                           Series 2007-EQ1

                                           Rating
                                           ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            A1         86363HAA0     A              AAA/Watch Neg
            A4         86363HAD4     AA             AAA/Watch Neg
            A5         86363HAE2     A              AAA/Watch Neg
            M1         86363HAF9     BB             AA+/Watch Neg
            M2         86363HAG7     B+             AA/Watch Neg

    Structured Asset Securities Corporation Mortgage Loan Trust
                              2007-TC1
                          Series 2007-TC1

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           M1         86364GAC7     A+             AA+/Watch Neg
           M2         86364GAD5     BBB            AA-/Watch Neg

        WaMu Asset Backed Certificates Series 2007-HE3 Trust
                           Series 2007-HE3

                                           Rating
                                           ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            M-1        93364EAG9     BBB            AA+/Watch Neg
            M-2        93364EAH7     BB             AA/Watch Neg

       Ratings Affirmed and Removed from Creditwatch Negative

     Ace Securities Corp Home Equity Loan Trust Series 2007-HE4
                          Series 2007-HE4

                                           Rating
                                           ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            A-2A       00442LAB5     AAA            AAA/Watch Neg
            A-2B       00442LAC3     AAA            AAA/Watch Neg

  ACE Securities Corp. Home Equity Loan Trust, Series 2007-ASAP2
                          Series 2007-ASAP2

                                           Rating
                                           ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            A-1        00442UAA7     AAA            AAA/Watch Neg
            A-2A       00442UAB5     AAA            AAA/Watch Neg
            A-2B       00442UAC3     AAA            AAA/Watch Neg
            A-2C       00442UAD1     AAA            AAA/Watch Neg
            A-2D       00442UAE9     AAA            AAA/Watch Neg

   ACE Securities Corp. Home Equity Loan Trust, Series 2007-HE5
                         Series 2007-HE5

                                         Rating
                                         ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           A-2A       000797AB6     AAA            AAA/Watch Neg
           A-2B       000797AC4     AAA            AAA/Watch Neg

Asset Backed Securities Corporation Home Equity Loan Trust, Series      
                          AMQ 2007-HE2
                         Series 2007-HE2

                                        Rating
                                        ------
          Class      CUSIP         To             From
          -----      -----         --             ----
          A2         04544TAB7     AAA            AAA/Watch Neg
          A3         04544TAC5     AAA            AAA/Watch Neg

       Bear Stearns Asset Backed Securities I Trust 2007-HE5
                         Series 2007-HE5

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           M-1        073859AG5     AA+            AA+/Watch Neg
           M-2        073859AH3     AA             AA/Watch Neg

                  BNC Mortgage Loan Trust 2007-2
                          Series 2007-2

                                         Rating
                                         ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           A1         05569QAA2     AAA            AAA/Watch Neg
           A2         05569QAB0     AAA            AAA/Watch Neg
           A3         05569QAC8     AAA            AAA/Watch Neg
           A4         05569QAD6     AAA            AAA/Watch Neg
           A5         05569QAE4     AAA            AAA/Watch Neg
           M1         05569QAF1     AA+            AA+/Watch Neg
           M3         05569QAH7     B              B/Watch Neg

                  BNC Mortgage Loan Trust 2007-3
                           Series 2007-3

                                          Rating
                                          ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            A1         05568QAA3     AAA            AAA/Watch Neg
            A2         05568QAB1     AAA            AAA/Watch Neg
            A3         05568QAC9     AAA            AAA/Watch Neg
            A4         05568QAD7     AAA            AAA/Watch Neg
            A5         05568QAE5     AAA            AAA/Watch Neg

                        C-Bass 2007-CB5 Trust
                           Series 2007-CB5

                                         Rating
                                         ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           A-1        12464YAA7     AAA            AAA/Watch Neg
           A-2        12464YAB5     AAA            AAA/Watch Neg
           A-3        12464YAC3     AAA            AAA/Watch Neg
           M-1        12464YAD1     AA+            AA+/Watch Neg

  C-BASS Mortgage Loan Asset-Backed Certificates Series 2007-SP2
                          Series 2007-SP2

                                          Rating
                                          ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            M-1        1248MHAD4     AA+            AA+/Watch Neg
            M-2        1248MHAE2     AA+            AA+/Watch Neg
            M-3        1248MHAF9     AA+            AA+/Watch Neg
            M-4        1248MHAG7     AA             AA/Watch Neg
            M-5        1248MHAH5     AA-            AA-/Watch Neg

              Citigroup Mortgage Loan Trust 2007-AHL3
                          Series 2007-AHL3

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           A-1        17312GAS0     AAA            AAA/Watch Neg
           A-2        17312GAT8     AAA            AAA/Watch Neg
           A-3A       17312GAA9     AAA            AAA/Watch Neg
           A-3B       17312GAB7     AAA            AAA/Watch Neg
           A-3C       17312GAC5     AAA            AAA/Watch Neg
           M-4        17312GAG6     B              B/Watch Neg

              Citigroup Mortgage Loan Trust 2007-AMC3
                          Series 2007-AMC3

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           M-1        17312EAF3     AA+            AA+/Watch Neg
           M-2        17312EAG1     AA             AA/Watch Neg

              Citigroup Mortgage Loan Trust 2007-AMC4
                          Series 2007-AMC4

                                           Rating
                                           ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            A-1        17313BAA9     AAA            AAA/Watch Neg
            A-2A       17313BAB7     AAA            AAA/Watch Neg
            A-2B       17313BAC5     AAA            AAA/Watch Neg
            A-2C       17313BAD3     AAA            AAA/Watch Neg
            A-2D       17313BAE1     AAA            AAA/Watch Neg
            M-1        17313BAF8     AA+            AA+/Watch Neg
            M-3        17313BAH4     B              B/Watch Neg

              Citigroup Mortgage Loan Trust 2007-WFHE1
                          Series 2007-WFHE1

                                           Rating
                                           ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            M-1        17311CAD3     AA+            AA+/Watch Neg
            M-2        17311CAE1     AA             AA/Watch Neg

             Citigroup Mortgage Loan Trust 2007-WFHE3
                         Series 2007-WFHE3

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           M-1        17313CAD1     AA+            AA+/Watch Neg
           M-2        17313CAE9     AA             AA/Watch Neg

           CWABS Asset Backed Certificates Trust 2007-10
                           Series 2007-10

                                          Rating
                                          ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            1-M-1      23246BAL5     AA+            AA+/Watch Neg
            2-M-1      23246BAM3     AA+            AA+/Watch Neg
            1-M-2      23246BAN1     AA             AA/Watch Neg
            2-M-2      23246BAP6     AA             AA/Watch Neg
            1-M-3      23246BAQ4     B              B/Watch Neg
            2-M-3      23246BAR2     B              B/Watch Neg

          CWABS Asset-Backed Certificates Series 2007-11
                           Series 2007-11

                                         Rating
                                         ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           1-M-3      23247LAJ7     B              B/Watch Neg
           2-M-3      23247LAK4     B              B/Watch Neg
           1-M-2      23247LAG3     AA             AA/Watch Neg
           2-M-2      23247LAH1     AA             AA/Watch Neg

           CWABS Asset-Backed Certificates Trust 2007-1
                            Series 2007-1

                                          Rating
                                          ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            M-1        23245CAF7     AA+            AA+/Watch Neg
            M-3        23245CAH3     B              B/Watch Neg

            CWABS Asset-Backed Certificates Trust 2007-7
                            Series 2007-7

                                           Rating
                                           ------
             Class      CUSIP         To             From
             -----      -----         --             ----
             M-1        12669VAF5     AA+            AA+/Watch Neg
             M-2        12669VAG3     AA             AA/Watch Neg

            CWABS Asset-Backed Certificates Trust 2007-8
                             Series 2007-8

                                          Rating
                                          ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            M-1        12669WAG1     AA+            AA+/Watch Neg
            M-2        12669WAH9     AA             AA/Watch Neg

           CWABS Asset-Backed Certificates Trust 2007-BC2
                           Series 2007-BC2

                                           Rating
                                           ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            M-1        12669QAF6     AA+            AA+/Watch Neg
            M-3        12669QAH2     B              B/Watch Neg

           CWABS Asset-Backed Certificates Trust 2007-BC3
                             Series 2007-BC3

                                          Rating
                                          ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            M-1        23246LAF6     AA+            AA+/Watch Neg
            M-2        23246LAG4     AA             AA/Watch Neg

             Equifirst Loan Securitization Trust 2007-1
                             Series 2007-1

                                         Rating
                                         ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           A-2A       29445UAA3     AAA            AAA/Watch Neg
           A-2B       29445UAB1     AAA            AAA/Watch Neg
           A-2C       29445UAC9     AAA            AAA/Watch Neg
           M-1        29445UAD7     AA+            AA+/Watch Neg

        Fieldstone Mortgage Investment Trust, Series 2007-1
                           Series 2007-1

                                          Rating
                                          ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            M1         31659YAE4     AA+            AA+/Watch Neg
            M2         31659YAF1     AA             AA/Watch Neg
            M3         31659YAG9     AA             AA/Watch Neg

                       First NLC Trust 2007-1
                            Series 2007-1

                                          Rating
                                          ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            A-1        32115BAA8     AAA            AAA/Watch Neg
            A-2        32115BAB6     AAA            AAA/Watch Neg
            A-3        32115BAC4     AAA            AAA/Watch Neg
            A-4        32115BAD2     AAA            AAA/Watch Neg
            M-1        32115BAE0     AA+            AA+/Watch Neg
            M-2        32115BAF7     AA             AA/Watch Neg
            M-3        32115BAG5     AA             AA/Watch Neg

                       GSAMP Trust 2007-FM2
                         Series 2007-FM2

                                          Rating
                                          ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            M-1        3622MHAF3     AA+            AA+/Watch Neg
            M-2        3622MHAG1     AA             AA/Watch Neg

                       GSAMP Trust 2007-HE1
                          Series 2007-HE1

                                          Rating
                                          ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            M-1        3622MDAF2     AA+            AA+/Watch Neg
            M-2        3622MDAG0     AA             AA/Watch Neg
            M-3        3622MDAH8     BBB            BBB/Watch Neg
            M-4        3622MDAJ4     B              B/Watch Neg

                        GSAMP Trust 2007-HE2
                           Series 2007-HE2

                                          Rating
                                          ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            M-1        362440AF6     AA+            AA+/Watch Neg
            M-2        362440AG4     AA             AA/Watch Neg
            M-3        362440AH2     AA-            AA-/Watch Neg

                       GSAMP Trust 2007-NC1
                          Series 2007-NC1

                                          Rating
                                          ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            A-1        3622MGAA6     AAA            AAA/Watch Neg
            A-2A       3622MGAB4     AAA            AAA/Watch Neg
            A-2B       3622MGAC2     AAA            AAA/Watch Neg
            A-2C       3622MGAD0     AA             AA/Watch Neg
            A-2D       3622MGAE8     AA             AA/Watch Neg
            R          3622MGAQ1     AAA            AAA/Watch Neg
            RC         3622MGAR9     AAA            AAA/Watch Neg
            RX         3622MGAS7     AAA            AAA/Watch Neg
            M-2        3622MGAG3     B              B/Watch Neg

                   Home Equity Asset Trust 2007-1
                             Series 2007-1

                                          Rating
                                          ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            2-A-1      43710LAB0     AAA            AAA/Watch Neg
            2-A-2      43710LAC8     AAA            AAA/Watch Neg
            R          43710LAS3     AAA            AAA/Watch Neg
            P          43710LAT1     AAA            AAA/Watch Neg

                  Home Equity Asset Trust 2007-3
                            Series 2007-3

                                         Rating
                                         ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           1-A-1      43710TAA5     AAA            AAA/Watch Neg
           2-A-1      43710TAB3     AAA            AAA/Watch Neg
           2-A-2      43710TAC1     AAA            AAA/Watch Neg
           2-A-3      43710TAD9     AAA            AAA/Watch Neg
           R          43710TAR8     AAA            AAA/Watch Neg
           P          43710TAS6     AAA            AAA/Watch Neg
           M-1        43710TAF4     AA+            AA+/Watch Neg
           M-5        43710TAK3     BB             BB/Watch Neg
           2-A-4      43710TAE7     AAA            AAA/Watch Neg

        HSI Asset Securitization Corporation Trust 2007-HE2
                          Series 2007-HE2

                                          Rating
                                          ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            I-A        40430RAA4     AAA            AAA/Watch Neg
            II-A-1     40430RAB2     AAA            AAA/Watch Neg
            II-A-2     40430RAC0     AAA            AAA/Watch Neg
            II-A-3     40430RAD8     AAA            AAA/Watch Neg
            II-A-4     40430RAE6     AAA            AAA/Watch Neg
            M-3        40430RAH9     BB             BB/Watch Neg

        HSI Asset Securitization Corporation Trust 2007-NC1
                          Series 2007-NC1

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           A-1        40430TAA0     AAA            AAA/Watch Neg
           A-2        40430TAB8     AAA            AAA/Watch Neg

            JPMorgan Mortgage Acquisition Trust 2007-CH3
                            Series 2007-CH3

                                          Rating
                                          ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            A-1A       46630XAA6     AAA            AAA/Watch Neg
            A-1B       46630XAB4     AAA            AAA/Watch Neg
            A-2        46630XAC2     AAA            AAA/Watch Neg
            A-3        46630XAD0     AAA            AAA/Watch Neg
            A-4        46630XAE8     AAA            AAA/Watch Neg
            A-5        46630XAF5     AAA            AAA/Watch Neg
            M-1        46630XAG3     AA+            AA+/Watch Neg
            M-3        46630XAJ7     B              B/Watch Neg

              Lehman ABS Mortgage Loan Trust 2007-1
                           Series 2007-1

                                           Rating
                                           ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            2-A1       52521MAB8     AAA            AAA/Watch Neg
            2-A2       52521MAC6     AAA            AAA/Watch Neg

            MASTR Asset Backed Securities Trust 2007-HE1
                         Series 2007-HE1

                                          Rating
                                          ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            A-1        576457AA3     AAA            AAA/Watch Neg
            A-2        576457AB1     AAA            AAA/Watch Neg
            A-3        576457AC9     AAA            AAA/Watch Neg
            A-4        576457AD7     AAA            AAA/Watch Neg
            M-1        576457AE5     AA+            AA+/Watch Neg
            M-3        576457AG0     BB             BB/Watch Neg
            M-4        576457AH8     B              B/Watch Neg

  Merrill Lynch First Franklin Mortgage Loan Trust, Series 2007-2
                            Series 2007-2

                                           Rating
                                           ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            A-2A       59024QAB6     AAA            AAA/Watch Neg
            A-2B       59024QAC4     AAA            AAA/Watch Neg
            R          59024QAS9     AAA            AAA/Watch Neg
            M-3        59024QAH3     B              B/Watch Neg

  Merrill Lynch First Franklin Mortgage Loan Trust, Series 2007-4
                           Series 2007-4

                                           Rating
                                           ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            2-A1       59025CAB6     AAA            AAA/Watch Neg
            2-A2       59025CAC4     AAA            AAA/Watch Neg
            R          59025CAV2     AAA            AAA/Watch Neg
            1-M3       59025CAK6     B              B/Watch Neg
            2-M3       59025CAL4     B              B/Watch Neg

     Merrill Lynch Mortgage Investors Trust, Series 2007-MLN1
                         Series 2007-MLN1

                                         Rating
                                         ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           A-1        59024UAA9     AAA            AAA/Watch Neg
           A-2A       59024UAB7     AAA            AAA/Watch Neg
           A-2B       59024UAC5     AAA            AAA/Watch Neg
           A-2C       59024UAD3     AAA            AAA/Watch Neg
           A-2D       59024UAE1     AAA            AAA/Watch Neg
           M-1        59024UAF8     AA+            AA+/Watch Neg

          Morgan Stanley ABS Capital I Inc. Trust 2007-HE5
                          Series 2007-HE5

                                         Rating
                                         ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           A-2a       61753KAB2     AAA            AAA/Watch Neg
           A-2b       61753KAC0     AAA            AAA/Watch Neg
           A-2c       61753KAD8     AAA            AAA/Watch Neg
           M-4        61753KAJ5     B              B/Watch Neg

          Morgan Stanley ABS Capital I Inc. Trust 2007-NC2
                          Series 2007-NC2

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           A-1        61753NAA8     AAA            AAA/Watch Neg
           A-2fpt     61753NAB6     AAA            AAA/Watch Neg
           A-2a       61753NAC4     AAA            AAA/Watch Neg
           A-2b       61753NAD2     AAA            AAA/Watch Neg
           A-2c       61753NAE0     AAA            AAA/Watch Neg

              Nationstar Home Equity Loan Trust 2007-B
                            Series 2007-B

                                           Rating
                                           ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            1-AV-1     63860LAA8     AAA            AAA/Watch Neg
            2-AV-1     63860LAB6     AAA            AAA/Watch Neg
            2-AV-2     63860LAC4     AAA            AAA/Watch Neg
            2-AV-3     63860LAD2     AAA            AAA/Watch Neg
            2-AV-4     63860LAE0     AAA            AAA/Watch Neg
            M-1        63860LAF7     AA+            AA+/Watch Neg
            M-2        63860LAG5     AA             AA/Watch Neg
            M-3        63860LAH3     AA-            AA-/Watch Neg

            Natixis Real Estate Capital Trust 2007-HE2
                          Series 2007-HE2

                                          Rating
                                          ------
           Class      CUSIP         To             From
           -----      -----         --             ----
           A-1        638728AA3     AAA            AAA/Watch Neg

Nomura Home Equity Loan, Inc. Home Equity Loan Trust Series 2007-3
                           Series 2007-3

                                           Rating
                                           ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            II-A-1     65537NAB0     AAA            AAA/Watch Neg
            II-A-2     65537NAC8     AAA            AAA/Watch Neg

               Option One Mortgage Loan Trust 2007-4
                           Series 2007-4

                                          Rating
                                          ------
            Class      CUSIP         To             From
            -----      -----         --             ----
            II-A-1     68403FAB2     AAA            AAA/Watch Neg
            II-A-2     68403FAC0     AAA            AAA/Watch Neg

              Option One Mortgage Loan Trust 2007-CP1
                           Series 2007-CP1

                                          Rating
                                          ------
            Class      CUSIP         To             From
            -----      -----         --             ----
          &n