/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/080609.mbx T R O U B L E D C O M P A N Y R E P O R T E R Monday, June 9, 2008, Vol. 12, No. 136 Headlines 9632 PARTNERS: Voluntary Chapter 11 Case Summary ACCREDITED HOME: Owner Acquires Bear Stearns Mortgage Assets ADVOCAT INC: Shareholders Spurn Suggestion to Liquidate Company AEGIS MORTGAGE: Seeks to Extend Removal Deadline to August 11 AIRGAS INC: Moody's Assigns Ba2 Rating to $350MM Sub. Notes ALBERT DAVIS: Case Summary & 8 Largest Unsecured Creditors ALLEGHENY ENERGY: S&P Lifts Sr. Unsecured Ratings to BBB- from BB+ ALLEN SYSTEMS: S&P Puts Rating on Neg. Watch on Disclosure Delay ALLEN-VANGUARD: Moody's Assigns SGL-3 Liquidity Rating ALLTEL CORP: Proposed Verizon Buyout Cues Fitch to Put Neg. Watch ALLTEL CORP: Verizon-Vodafone Purchase Deal Cues S&P's Pos. Watch AMBAC FINANCIAL: Disappointed Over S&P's Rating Actions AMBAC FINANCIAL: S&P Cuts Ratings on Ambac Assurance-Backed Issues AMERICAN IRONHORSE: Court OKs AIH Acquisition's $8MM Bid AMERICAN NATURAL: Malone & Bailey Expresses Going Concern Doubt AMORTIZING RESIDENTIAL: Fitch Takes Various Certs. Rating Actions AMRESCO RESIDENTIAL: Fitch Takes Rating Actions on 13 Certificates ASARCO LLC: Examiner Wants to Retain Warner Stevens ASARCO LLC: Wants to Expand Keegan's Insurance Coverage Services ASARCO LLC: Employees Given Until July 26 to File Severance Claims AVANI INT'L: Posts $109,795 Net Loss in 2008 First Quarter ASSET BACK: Fitch Holds Junked Ratings on Two Certificate Classes AXESSTEL INC: Earns $256,658 in 2008 First Quarter Ended March 30 BEAR STEARNS: Mortgage Biz Sold to LoneStar for Undisclosed Price BGF INDUSTRIES: Moody's Withdraws Junk Ratings BLACK GAMING: S&P Places 'B-' Rating Under Negative CreditWatch BLOUNT FAMILY: Case Summary & 19 Largest Unsecured Creditors BLUE SKY: Case Summary & 11 Largest Unsecured Creditors BRIGHTON LLC: Case Summary & 6 Largest Unsecured Creditors C-BASS: Fitch Chips Ratings on Two Certificate Classes to BB CALIFORNIA CONDOMINIUMS: Involuntary Chapter 11 Case Summary CALPINE CORP: Names Zamier Rauf as Interim Chief Fin'l Officer CHENIERE ENERGY: Jonathan Gross Resigns as Senior Vice President CIFG GUARANTY: S&P Cuts Financial Strength Rating to A- from A+ CITIZENS REPUBLIC: Fitch Expects to Rate Stock Issuance 'BB+ COHR HOLDINGS: Loss of Largest Customer Cues Moody's to Junk CFR COSINE COMMS: Earns $52,000 in 2008 First Quarter Ended March 31 COUDERT BROS: Disclosure Statement Needs More Changes, Court Says COUNTRYWIDE FINANCIAL: Gets "Blackout" Notice from 401(k) Trustee CRT LAND: Case Summary & Three Largest Unsecured Creditors CUMULUS MEDIA: High Debt Leverage Cues Moody's to Cut Ratings CUSTOM ENGINEERED: Case Summary & 19 Largest Unsecured Creditors DECODE GENETICS: Stockholders Approve Equity Incentive Plan DEN-MARK CONSTRUCTION: Cash Collateral Hearing to Continue June 26 DEN-MARK CONSTRUCTION: Stock DIP Fund Hearing to Continue June 26 EAGLE INVESTMENTS: Files Voluntary Chapter 11 Case Summary ESMARK INC: Says Reports on Failure to Refinance Debt Are False ESMARK INC: Severstal Waives Essar Steel Deal, Says Offer is Valid ESPLANADE LLC: Secured Parties to Hold Auction on June 16 ETRICITY: Three Texas Electricity Retailers Close After Default EVERGREEN INT'L: Moody's Junks Corp. Family Rating; Outlook Neg. FGIC: Projected CDO Losses Cue S&P's Negative Watch FORTUNE AT HIALEAH: Case Summary & 32 Largest Unsecured Creditors FREMONT GENERAL: Fitch Withdraws Default Rating FREMONT HOME: Fitch Affirms 'BB-' Rating on Class M-4 Certificates GAP INC: May 2008 Sales Decrease 8% at $1.09 Billion GE CAPITAL: Fitch Downgrades Ratings on Nine Certificate Classes GENERAL ENVIRONMENTAL: Has $342,826 Equity Deficit at March 31 GLOBAL REALTY: Meyler & Co Expresses Going Concern Doubt GMAC LLC: S&P's Rating Unaffected by Refinancing Implementation GOODY'S FAMILY: Clothing Stores Operator Might File for Bankruptcy GP INVESTMENTS: Fitch Upgrades Foreign ID Rating to B+ from B GREEKTOWN CASINO: Court Gives Interim Nod on Cash Collateral Use GSV INC: Earns $216,677 in 2008 First Quarter Ended March 31 HOME INTERIORS: Boulder Approved as Business Consultant and CRO HOVNANIAN ENTERPRISES: Completes $600 Mil. Notes Offering IBIS TECHNOLOGY: KPMG LLP Expresses Going Concern Doubt IDEARC INC: Appoints Scott Klein as Chief Executive Officer IMPERIAL INDUSTRIES: Posts $1,955,000 Net Loss in 2008 1st Quarter ISCO INTERNATIONAL: Names Gary Berger as New Financial Chief JEFFERSON COUNTY: Hires Merrill Lynch as Adviser on Debt Talks JEVIC TRANSPORTATION: U.S. Trustee Forms 3-Member Creditors Panel JEWETT TUCKER: Case Summary & Six Largest Unsecured Creditors JOEY STEINFELDT: Case Summary & 20 Largest Unsecured Creditors JULIETTE MYUNG LEE: Case Summary & 12 Largest Unsecured Creditors LANDSOURCE COMMUNITIES: Files for Chapter 11 in Wilmington LEELAND STATION: Voluntary Chapter 11 Case Summary LEINER HEALTH: Sale Lambasted; Can Not Assign Pacts, Gov't Says LEVEL 3: Completes $129MM Advertising Distribution Business Sale LEXINGTON PRECISION: Malin Bergquist Raises Going Concern Doubt LIBERTY TAX: Is Neutral to Peachtree's Unsolicited Tender Offer LIQUIDATION WORLD: Weighing Strategic Options to Increase Value LLOYD HUNTER: Case Summary & 4 Largest Unsecured Creditors LONEWA BAPTIST: Voluntary Chapter 11 Case Summary LUBBOCK MEDICAL: Investor Group to Announce Buyout Plans Today LUBBOCK MEDICAL: Gets Okay to Use Cash Collateral Until June 18 MAHONING COUNTY: S&P Lowers Bond Rating to B+ from BB MAJESKY AUTOMOTIVE: Case Summary & 20 Largest Unsecured Creditors MBIA INSURANCE: S&P Chips 10 Ratings to AA; Puts Under Neg. Watch MCGEEHAN CONSTRUCTION: Voluntary Chapter 11 Case Summary MEDIACOM COMMS: Units Ink New $350 Million Term Loan Agreement MOSHE KIPERSZTOK: Voluntary Chapter 11 Case Summary LUNA HEALTH: Case Summary & 20 Largest Unsecured Creditors MERRILL LYNCH MORTGAGE: S&P Junks Rating on Class G Certificates MIRABILIS VENTURES: Case Summary & 23 Largest Unsecured Creditors NATIONAL CITY: Agreement with OCC Confirms Federal Probation NATIONAL POWER: Texas Electricity Retailers Close After Default NEOMAGIC CORP: Has Until December 1 to Comply with Nasdaq Criteria NETWURX INC: Case Summary & 60 Largest Unsecured Creditors NORTHPOINT VILLAGE: Case Summary & 4 Largest Unsecured Creditors OAKS GROUP: Case Summary & 20 Largest Unsecured Creditors OTAY VALLEY: Case Summary & 6 Largest Unsecured Creditors PACIFIC FIRST: Case Summary & 2 Largest Unsecured Creditors PACIFIC LUMBER: Judge Schmidt to Confirm Marathon/Mendocino Plan PACIFIC LUMBER: BoNY Submits Post-Trial Brief on Impairment Issues PATIENT SAFETY: Closes $2.4 Million in Equity Financing PENTON BUSINESS: Continued Weakness Cues Moody's to Cut CFR to B3 PERKINS & MARIE: S&P Holds 'B-' Rating and Revises Outlook to Neg. PRE-BUY ELECTRIC: Texas Electricity Retailers Close After Default PURADYN FILTER: March 31 Balance Sheet Upside-Down by $5,239,339 PURCHASE POINT: March 31 Balance Sheet Upside-Down by $1,913,361 REFCO INC: Former CEO Bennett in Talks with Investor-Plaintiffs RESIDENTIAL CAPITAL: $8.6 Billion Old Notes Tendered RESIDENTIAL CAPITAL: Fitch Puts 'D' Ratings After Debt Exchange RESIDENTIAL FUNDING: Fitch Trims Ratings on 10 Cert. Classes RHAPSODY ACQUISITION: BDO Seidman Expresses Going Concern Doubt RIGALI SECURITY: Foreclosure Sale of Assets Set for Wednesday RUFFIN ROAD: Voluntary Chapter 11 Case Summary SAND HILL CAPITAL: Files for Chapter 7; Founder Goes Bankrupt Too SAXON MORTGAGE: Fitch Chips Ratings on Seven Certificate Classes SOUTHERN UNION: Fitch Cuts Preferred Stock Rating to BB+ from BBB- ST. STEPHEN: Voluntary Chapter 11 Case Summary SCHOEN INVESTMENTS: Case Summary & 5 Largest Unsecured Creditors SHELLS SEAFOOD: Earns $119,588 in 2008 1st Quarter Ended March 30 SIMON WORLDWIDE: March 31 Balance Sheet Upside-Down by $17,031,000 SOUTHLAND TERRACE: Voluntary Chapter 11 Case Summary SPAP-2005: Voluntary Chapter 11 Case Summary STEVEN PATHMAN: Case Summary & 20 Largest Unsecured Creditors STURGIS IRON: Sells Assets to SDI Sub for $41,000,000 SURE ELECTRIC: Voluntary Chapter 11 Case Summary TALBOTS INC: Cuts 9% of Workforce Slashing $14 Million on Costs TETRAGENEX PHARMA: Sherb & Co. Expresses Going Concern Doubt TOUSA INC: Court Okays Robert Charles as Committee's Advisors TOUSA INC: DIP Termination Date Extended Until June 11 TOUSA INC: Wants to Broaden Services of Auditor Ernst & Young TRIPLE CROWN: March 31 Balance Sheet Upside-Down by $58.6 Million TROPICANA ENTERTAINMENT: Court Final OKs $67 Million DIP Financing TROPICANA ENT: Obtains Final OK to Access LandCo's Cash Collateral TROPICANA ENT: Court OKs Access to OpCo Lenders' Cash Collateral TROPICANA ENTERTAINMENT: Sets up New Board to Restructure Business TS PRINTING: Voluntary Chapter 11 Case Summary TUCSON ELECTRIC: S&P Revises Outlook to Positive from Stable UBS AG: Will Exit Municipal Bond Business and Eliminate 280 Jobs VONAGE HOLDINGS: Settles Patent-Infringement Suit by Web Telephony WACHOVIA BANK: S&P Puts Five Low-B Ratings Under Negative Watch WELLMAN INC: Lenders Further Defer Deadline for Bid Protocol OK WILLIAM DEL BIAGGIO: Files for Chapter 11 Amid Loan Fraud Charges XERIUM TECHNOLOGIES: Moody's Affirms Caa1 Corp. Family Rating ZACHARIA LAMAR: Case Summary & 20 Largest Unsecured Creditors * S&P Cuts Ratings on 76 Classes of Certs. from 17 US ALT-A RMBS * BOND PRICING: For the Week of June 2 to June 7, 2008 ********* 9632 PARTNERS: Voluntary Chapter 11 Case Summary ------------------------------------------------ Debtor: 9632 Partners Ltd. 7500 Bellaire Boulevard, Suite 201 Houston, TX 77036 Bankruptcy Case No.: 08-60048 Chapter 11 Petition Date: June 3, 2008 Court: Southern District of Texas (Victoria) Debtor's Counsel: Gregg K. Saxe, Esq. Attorney at Law 10101 Southwest Freeway Suite 101 Houston, TX 77074 Tel: (713) 995-5733 Fax: (713) 995-5122 E-mail: gsaxe@sbcglobal.net Estimated Assets: $1 million to $10 million Total Debts: $2,540,000 The Debtor did not file a list of its 20 Largest Unsecured Creditors. ACCREDITED HOME: Owner Acquires Bear Stearns Mortgage Assets ------------------------------------------------------------ Lone Star Funds has acquired "certain operating assets" from Bear Stearns Cos.' residential mortgage unit -- Bear Stearns Residential Mortgage Corp. -- for an undisclosed sum, various reports say. By Jody Shenn According to Bloomberg News, Lone Star spokesman Ed Trissel confirmed the transaction in an e-mailed statement May 30, 2008. Mr. Trissel said the fund manager also purchased the rights to other assets, the report says. Lone Star bought subprime lender Accredited Home Lenders Holding Co. for about $296,000,000 in October, Bloomberg says. About Lone Star Funds Lone Star Funds -- http://www.lonestarfunds.com/-- is a U.S. private equity firm. Since 1995, the principals of Lone Star have organized private equity funds totaling more than $13.3 billion to invest globally in corporate secured and unsecured debt instruments, real estate related assets and select corporate opportunities. About Bear Stearns New York City-based The Bear Stearns Companies Inc. (NYSE: BSC) -- http://www.bearstearns.com/-- is a leading financial services firm serving governments, corporations, institutions and individuals worldwide. The company's core business lines include institutional equities, fixed income, investment banking, global clearing services, asset management, and private client services. The company has approximately 14,000 employees worldwide. As reported by the Troubled Company Reporter, Bear Stearns stockholders approved the investment bank's merger with JPMorgan Chase & Co. at a Special Meeting of Stockholders held May 29, 2008. Approximately 84% of shares voted were in favor of the merger, representing a substantial majority of Bear Stearns' outstanding common stock. The Wall Street Journal reports that the value of the transaction is about $1.4 billion, a large difference from the $25 billion market capitalization value in early 2007 before its defeat. Upon completion of the merger, each outstanding share of common stock of Bear Stearns will be converted into the right to receive 0.21753 shares of JPMorgan Chase common stock and Bear Stearns will become a direct subsidiary of JPMorgan Chase. * * * As reported in the Troubled Company Reporter on Dec. 28, 2007, Fitch Ratings' affirmed its Negative Outlook for The Bear Stearns Companies Inc. following the announcement of the company's fiscal year earnings for 2007. On Nov. 14, 2007, Fitch affirmed Bear Stearns' long-term credit ratings, along with its subsidiaries. Fitch also downgraded the short-term rating to 'F1' from 'F1+', and Individual rating to 'B/C' from 'B'. About Accredited Home Headquartered in San Diego, California, Accredited Home Lenders Holding Co. (NASDAQ:LEND) -- http://www.accredhome.com/-- is a mortgage company operating throughout the U.S. and in Canada. Founded in 1990, the company originates, finances, securitizes, services, and sells non-prime mortgage loans secured by residential real estate. ADVOCAT INC: Shareholders Spurn Suggestion to Liquidate Company --------------------------------------------------------------- Advocat Inc.'s shareholders shot down a proposal that would have directed the company's board to pursue a sale or liquidation of the long-term care company, the Nashville Business Journal reports. In a press statement, the company stated that the proposal by shareholder Bristol Capital Advisors LLC received about 14% of shareholder votes cast. The report, citing the Securities and Exchange Commission filings, states that Bristol Capital owns about 5%, or 294,834 shares, of outstanding Advocat stock. Nashville Business relates that Bristol first bought a stake in the company in 2006, and has repeatedly urged company officials to explore a sale or liquidation of the company's assets. Bristol manager Paul Kessler criticized the company's governance and recommended the board make several changes to enhance shareholder value, Nashville Business adds. In a statement, Advocat Inc. also reported the official voting results from its Annual Meeting of Shareholders held on June 3, 2008. Advocat's board nominees received more than 95% of the votes cast for the election of directors at the company's annual meeting. Accordingly, Wallace E. Olson was reelected to the board of directors and Chad A. McCurdy, an appointed director, was elected by the shareholders to serve a three year term. Shareholders also approved the 2008 Stock Purchase Plan for Key Personnel with 82% of the votes cast in favor of the plan. The company disclosed that the time period to appeal the West Virginia Certificate of Need has ended and no appeal was filed. The company entered into an option agreement to purchase certain assets of a skilled nursing facility in West Virginia and applied to state regulatory authorities to allow the company to operate the facility and construct a 90 bed replacement facility. This application was approved in February 2008, subject to rights of appeal by contesting parties. About Advocat Inc. Headquartered in Brentwood, Tennessee, Advocat Inc. (NASDAQ: AVCA) -- http://www.irinfo.com/avc-- provides long term care services to patients in 50 skilled nursing centers containing 5,773 licensed nursing beds in the Southeast and Southwest. AEGIS MORTGAGE: Seeks to Extend Removal Deadline to August 11 ------------------------------------------------------------- Aegis Mortgage Corp. and its debtor-affiliates ask the U.S. Bankruptcy Court for the District of Delaware to extend the time by which they may file notices of removal with respect to civil actions pending between bankruptcy filing and Aug. 11, 2008. The Debtors believe it is prudent to seek an extension of the period to file notices of removal in order to protect its right to remove the Actions. Laura Jones, Esq., at Pachulski Stang Ziehl & Jones LLP, tells the Court that currently the Debtors are occupied with the development and negotiation of a plan in their Chapter 11 cases. She adds the Debtors have not had an opportunity to fully review Actions to determine whether there are any that may need to be removed. Ms. Jones says the requested extension will afford the Debtors the opportunity necessary to make fully-informed decisions concerning removal of any Action and will assure that the Debtors do not forfeit valuable rights under Section 1452 of the Judiciary and Judicial Procedures Code. Further, the rights of the Debtors' adversaries will not be prejudiced by an extension because any party to an Action that is removed may seek to have it remanded to the state court pursuant to Section 1452(b) of the Federal Rules of Bankruptcy Procedure. The Court will convene a hearing on June 16, 2008, at 10:30 a.m., to consider the Debtors' request. Headquartered in Houston, Texas, Aegis Mortgage Corporation -- http://www.aegismtg.com/-- offers a variety of mortgage loan products to brokers through its subsidiaries. The company together with 10 affiliates filed for chapter 11 protection on Aug. 13, 2007 (Bankr. D. Del. Case No. 07-11119). Curtis A. Hehn, Esq., James E. O'Neill, Esq., Laura Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachulski, Stang, Ziehl, & Jones, L.L.P., serve as counsel to the Debtors. The Official Committee of Unsecured Creditors is represented by Landis Rath & Cobb LLP. In schedules filed with the Court, Aegis disclosed total assets of $138,265,342 and total debts of $4,125,470. (Aegis Bankruptcy News, Issue No. 22; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). AIRGAS INC: Moody's Assigns Ba2 Rating to $350MM Sub. Notes ----------------------------------------------------------- Moody's Investors Service assigned a Ba2 rating to the $350 million guaranteed subordinated notes of Airgas Inc due 2018 and affirmed its other ratings (Corporate Family Rating of Ba1). The company's rating outlook is positive. Proceeds from the offering will be used to repay outstanding balances under the company's existing revolving credit facility and improve liquidity. Airgas' Ba1 Corporate Family Rating (CFR) reflects the company's leading market share in packaged gases, solid financial metrics, the relative stability of the industrial gas business due to a diverse customer base, and the expectation that the majority of free cash flow will be utilized to support additional acquisitions or repay debt. The company's ratings are tempered by management's tendency toward pursuing additional acquisitions, at the expense of debt reduction. However, Airgas has long track record of successfully integrating packaged gas acquisitions, expanding into related markets and repaying debt before pursuing another large transaction. The pace of acquisitions over the past two years, costing roughly $1.2 billion, has been the largest in the company's history. Despite this aggressive growth, the company was able to return margins to near investment grade levels very quickly. Moody's believes that this increases the likelihood that Airgas' financial metrics could rise to levels that would support a sustainable investment grade profile within the next year (25% Retained Cash Flow/Debt and 8% Free Cash Flow/Debt, including Moody's standard adjustments). The positive outlook reflects Moody's expectation that Airgas will be able to generate over $100 million of free cash flow and strengthen other financial metrics to levels that could potentially support a higher rating, despite further weakness in the US economy and the precipitous increase in energy and fuel costs. Airgas has been able to keep margins relatively constant over the past year by increasing gas prices and adding surcharges to fully offset rising costs. In fiscal 2009, Moody's expects Airgas' EBITDA to be above $700-740 million due to the full year impact of recently acquired businesses, on-going synergies from acquisitions over the past two years and continued growth, albeit modest, in its existing operations. The Ba2 rating on the subordinated notes reflects their position in the capital structure relative to roughly $1 billion (assuming that the company issues $350 million of subordinated notes) of unsecured bank debt. Rating assigned: Airgas Inc. -- $350 million Guaranteed Subordinated Notes due 2018 at Ba2 (LGD5, 89%) Ratings affirmed: Airgas Inc. -- Corporate Family Rating at Ba1 -- Probability of Default Rating at Ba1 -- $150 million Guaranteed Subordinated Notes due 2014 at Ba2 (LGD5, 89%) Airgas Inc., headquartered in Radnor, PA, is the largest independent distributor of industrial, medical and specialty gases and related equipment in North America. Airgas reported $4 billion in sales for its fiscal year ending March 31, 2008. ALBERT DAVIS: Case Summary & 8 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Albert Davis 14813 South Kilpatrick Midlotian, IL 60445 Bankruptcy Case No.: 08-13529 Chapter 11 Petition Date: May 29, 2008 Court: Northern District of Illinois (Chicago) Judge: Bruce W. Black Debtors' Counsel: Karen J. Porter, Esq. Porter Law Network 11 East Adams St., Ste. 906 Chicago, IL 60603 Tel: (312) 675-0665 Fax: (312) 893-7370 E-mail: kjplawnet@aol.com Estimated assets: $1 million to $100 million Estimated debts: $50,000 to $$100,000 A copy of the Debtor's petition and a list of its eight largest unsecured creditors are available at no charge at http://bankrupt.com/misc/ilnb08-13529.pdf ALLEGHENY ENERGY: S&P Lifts Sr. Unsecured Ratings to BBB- from BB+ ------------------------------------------------------------------ Standard & Poor's Ratings Services raised its senior unsecured ratings on energy supply company Allegheny Energy Supply Co. LLC to 'BBB-' from 'BB+' to reflect its claim to the asset base that is no longer significantly disadvantaged with respect to secured debt at the company, resulting in the elimination of the one-notch differential between the corporate credit rating and the unsecured debt rating. At the same time, Standard & Poor's affirmed the 'BBB-' corporate credit rating on Allegheny Supply. The affirmation follows the conclusion of our annual review. The outlook is stable. While Allegheny Supply had almost $2.0 billion of debt as of March 31, 2008, parent Allegheny Energy Inc.'s consolidated debt was $4.0 billion as of March 31, 2008. The ratings reflect the consolidated credit quality of parent Allegheny Energy Inc. The ratings on Allegheny reflect cash flow stability of utility subsidiaries, Monongahela Power Co., West Penn Power Co., and Potomac Edison Co., and the higher business risk of unregulated generation subsidiary, Allegheny Supply, which currently has strong cash flow due to sound structural fundamentals. Allegheny's consolidated credit quality reflects a strong business risk profile and an aggressive financial risk profile. ALLEN SYSTEMS: S&P Puts Rating on Neg. Watch on Disclosure Delay ---------------------------------------------------------------- Standard & Poor's Ratings Services placed its 'B' corporate credit and bank loan ratings on Naples, Florida-based Allen Systems Group Inc. on CreditWatch with negative implications. The CreditWatch listing follows the company's failure to meet the deadline to make its audited 2007 annual and unaudited March- quarter financial statements available to lenders. S&P will continue to monitor management's progress toward meeting its financial disclosure requirements. "If ASG maintains its operating and leverage trends and has no material restatements or reclassifications, we would expect to affirm our ratings and assign a stable outlook," said Standard & Poor's credit analyst Joseph Spence. ALLEN-VANGUARD: Moody's Assigns SGL-3 Liquidity Rating ------------------------------------------------------ Moody's Investors Service assigned an SGL-3 Speculative Grade Liquidity Rating to Allen-Vanguard Corporation, reflecting Moody's opinion that AVC's liquidity profile is adequate. The rating assignment provides greater clarity around Moody's view of AVC's liquidity profile incorporated into the recent assignment of B1 corporate family and senior secured and B2 probability of default ratings to AVC. Assignments: Issuer: Allen-Vanguard Corporation * Speculative Grade Liquidity Rating, Assigned SGL-3 AVC's SGL-3 rating reflects its nominal cash balances, access to an unused $50 million revolver and Moody's expectation that AVC's annual free cash flow should remain in excess of scheduled debt maturities. The rating also recognizes a modest degree of tightness to covenants and revolver availability that could develop should new revenue opportunities take longer than expected to materialize or should lengthy delays in Government orders occur. Headquartered in Ottawa, Canada, Allen-Vanguard Corporation is a defense contractor. Revenues during the 12 months ending March 31, 2008 were C$294 million. ALLTEL CORP: Proposed Verizon Buyout Cues Fitch to Put Neg. Watch ----------------------------------------------------------------- Fitch Ratings has placed the Issuer Default Rating and outstanding debt ratings of Verizon Communications, Inc. ratings and subsidiaries on Rating Watch Negative as: -- Long-term IDR 'A+'; -- Senior unsecured debt 'A+'; -- $6 billion bank facility 'A+'. Fitch has also affirmed Verizon's short-term ratings: -- Short-term IDR 'F1'; -- Commercial paper 'F1'. Fitch has also placed Alltel Corp. and subsidiaries on Rating Watch Positive: Alltel Corp. -- IDR 'B'; -- Senior unsecured credit facility 'CCC+/RR6'; -- Senior unsecured debt 'CCC+/RR6'. The actions reflect Verizon's proposed acquisition of Alltel for an aggregate consideration of $28.1 billion, reflecting equity consideration of $5.9 billion and net debt of $22.2 billion expected at the time of the close of the transaction. In evaluating the final ratings, Fitch will review the proposed terms of the transaction, the expected capital structure of Verizon, expectations for the combined company's future financial performance, and prospective credit metrics. Fitch will also include an evaluation of the proposed synergies in the transaction. Fitch believes, pending final review of the transaction, that a downgrade would be limited to one notch, if necessary. Fitch notes that Verizon's current ratings are supported by the continued strong growth at Verizon Wireless of revenue, EBITDA and free cash flow. In 2007, VZW produced 47% and 57% of Verizon's consolidated revenues and EBITDA, respectively, a proportion that will increase materially following continued growth in 2008 and through the Alltel acquisition in late 2008 or early 2009. VZW's revenues and EBITDA have been growing above the industry average as it continues to take an above average proportion of retail postpaid subscribers added by the nationwide operators with the gains attributable to its strong brand, network quality and extensive distribution network. Although there is pressure on voice service revenues per customer, wireless data revenue growth has been more than offsetting the declines. Fitch believes growth prospects for data service revenues are good as lower price points are implemented, data-capable handsets are more widely deployed, and as new applications become available. At March 31, 2008, Verizon had $35.8 billion in debt outstanding. At the end of March 2008, Verizon had approximately $2 billion in CP and $1.7 billion in long-term debt maturing within one year. Fitch expects Verizon to maintain aggregate CP balances within a level fully backed by a $6 billion credit facility, which expires in September 2009. The credit facility has no ratings triggers or other restrictive covenants, such as leverage or interest coverage tests. For the twelve months ending March 31, 2008, free cash flow after dividends and capital spending was approximately $4.2 billion, and at March 31, 2008, Verizon had approximately $5.5 billion in cash. Fitch has placed these Verizon subsidiary ratings on Rating Watch Negative: GTE Corp. NYNEX Corp. Verizon Delaware Verizon California Verizon Florida Verizon Maryland Verizon New England Verizon New Jersey Verizon New York Verizon North Verizon Northwest Verizon Pennsylvania Verizon Virginia Verizon West Virginia -- IDR 'A+'; -- Senior unsecured 'A+'. GTE Southwest -- IDR 'A+'; -- First mortgage bonds 'A+'. Verizon Global Funding -- Senior unsecured 'A+'. Additionally, Fitch has placed he following Alltel subsidiary on Rating Watch Positive: Alltel Communications Inc. -- IDR 'B'; -- Senior secured bank credit facility 'BB/RR1'; -- Senior unsecured debt 'B/RR4'. Fitch has also withdrawn the following ratings as the following debt is no longer outstanding: Verizon South -- IDR 'A+'; -- Senior unsecured 'A+'. Alltel Corp. -- Senior unsecured credit facility 'CCC+/RR6'. Alltel Ohio -- IDR 'B'; -- Senior unsecured notes due 2010 'B/RR4'. ALLTEL CORP: Verizon-Vodafone Purchase Deal Cues S&P's Pos. Watch ----------------------------------------------------------------- Standard & Poor's Ratings Services placed its ratings on Little Rock, Arkansas-based wireless provider ALLTEL Corp., including the 'B+' corporate credit rating, on CreditWatch with positive implications. This action follows the announcement that Verizon Wireless, a joint venture of Verizon Communications (A/Negative/A-1) and Vodafone (A-/Stable/--), has agreed to purchase ALLTEL for approximately $28.1 billion in cash and assumed debt. S&P expect the acquisition to close by year-end following the receipt of regulatory approvals. ALLTEL has more than 13 million subscribers in 34 states. Debt outstanding for ALLTEL totaled about $23.6 billion at March 31, 2008. "We will review Verizon's plans for any potential refinancing of ALLTEL's existing debt and withdraw the ratings on those issues at that time," said Standard & Poor's credit analyst Susan Madison. We will also determine the rating for any ALLTEL debt that remains outstanding following the close of the transaction. "Remaining debt is likely to be rated at, or close to, the rating on Verizon Communications," added Ms. Madison. AMBAC FINANCIAL: Disappointed Over S&P's Rating Actions ------------------------------------------------------- Ambac Financial Group Inc. said in a statement responding to the rating actions by Standard & Poor's Rating Services that it is disappointed by the actions taken by S&P. As reported by the Troubled Company Reporter on June 6, 2008, S&P lowered its financial strength ratings on Ambac Assurance Corp. and MBIA Insurance Corp. to 'AA' from 'AAA' and placed the ratings on CreditWatch with negative implications. The ratings on the holding companies, Ambac Financial Group and MBIA Inc., have also been lowered to 'A' and 'A-' from 'AA' and 'AA-', respectively, and placed on CreditWatch with negative implications. Ambac Financial, noted in its response that less than three months ago, S&P affirmed its AAA rating and removed Ambac from Credit Watch Negative, citing its successful capital raise and moratorium on new structured finance business production. At that time, Ambac had claims paying ability greater than $700 million in excess of S&P's stated requirements. In the statement, Ambac said that S&P informed them that it is no longer basing its rating on claims paying ability, but rather on the diminished flow of new public finance and structured finance business the company is experiencing. Michael Callen, chairman and CEO of Ambac, commented: "We believe there would be strong demand for a stable AAA financial guarantor focused solely on guaranteeing the obligations of both municipal and global public finance. We also believe that, based on its proposed capitalization and business plan, the new Connie Lee will receive regulatory approval and will attract stable AAA ratings. Ambac remains committed to working closely with S&P and other rating agencies not only to further explain the details of our insured portfolio and the results of our active portfolio remediation efforts, but also to explore all strategic options available to us." About Ambac Financial Based in New York City, Ambac Financial Group, Inc. is a holding company that provides financial guarantees and financial services to clients in both the public and private sectors around the world through its principal operating subsidiary, Ambac Assurance Corporation. As an alternative to financial guarantee insurance credit protection is provided by Ambac Credit Products, a subsidiary of Ambac Assurance, in credit derivative format. * * * As reported in the Troubled Company Reporter on March 7, 2008, Moody's Investors Service said in a news statement that Ambac Financial Group Inc., if successful with its equity offering of $1.5 billion, will likely retain its "Aaa" rating. Moody's said that it will evaluate Ambacs ability to raise capital at reasonable terms as an indication of the companys financial flexibility and overall level of support from investors. In Moody's view, Ambacs new equity and equity linked capital through a public offering represents an important component of its overall plan to strengthen the credit profile of its financial guaranty insurance subsidiary, Ambac Assurance Corporation. On Jan. 18, Fitch Ratings downgraded Ambac to double-A after the insurer put off plans to raise equity capital. Moody's, the TCR said Jan. 17, 2008, placed the Aaa insurance financial strength ratings of Ambac Assurance Corporation and Ambac Assurance UK Limited on review for possible downgrade. In the same rating action, Moody's also placed the ratings of the holding company, Ambac Financial Group, Inc. (senior debt at Aa2), and related financing trusts on review for possible downgrade. Moody's stated that this rating action follows Ambacs announcement of record losses, a capital raising plan, and the retirement of its CEO. AMBAC FINANCIAL: S&P Cuts Ratings on Ambac Assurance-Backed Issues ------------------------------------------------------------------ Standard & Poor's Ratings Services lowered its standard long-term ratings on 20 Ambac Assurance Corp.-backed issues listed below to 'AA' from 'AAA' and placed them on CreditWatch with negative implications. At the same time, Standard & Poor's lowered its underlying ratings on seven Ambac Assurance Corp.-backed issues listed below to 'AA' from 'AAA' and placed them on CreditWatch with negative implications. These actions follow Standard & Poor's downgrade of Ambac Assurance Corp. to 'AA' from 'AAA' and placement on CreditWatch with negative implications. Nineteen of the issues receive partial support in the form of guaranteed investment contracts or investment agreements from Ambac Assurance Corp. One issue, Illinois Housing Development Authority receives support from Ambac under a surety bond. If the trustee does not receive payment from the borrower the trustee would request payment from IHDA. Should such payment not be made, the trustee is then instructed to file a notice of claim under the Ambac surety bond. Seven issues where the SPUR was placed on CreditWatch with negative implications have bond insurance with Financial Security Assurance Inc. The standard long-term rating will continue to be 'AAA'. Standard & Poor's examined all local housing bond issues with partial credit support from Ambac, taking several factors into consideration. Some issues are not affected because their current ratings can still be supported by credit supports from Ambac, and other factors. For local issuers, which represent the majority of the affected ratings, Standard & Poor's looked at the reliance upon the insurer's credit support. The CreditWatch placements reflect the issue's reliance upon return of principal and investment earnings to meet bond payment obligations. Issue Description * Athens Housing Authority, GA, Multifamily Housing Revenue Bonds (Bethel Church Homes Apts Project), series 2001 * Atlanta Housing Authority, GA, Ginnie Mae Collateralized Multifamily Housing Revenue Bonds (Village at Castleberry Hill Project), series 1999 * Bountiful, UT, Ginnie Mae Collateralized mortgage revenue bonds (Paragon Assisted Living Inc. Project), series 1998 * Chicago, IL, Multifamily Housing Revenue Bonds (Archer Courts Apts), series 1999A * Florida Housing Finance Corp., Housing Revenue Bonds (Mallards Landing Apts), series 2002 C-1 * Florida Housing Finance Corp., Housing Revenue Bonds (Mallards Landing Apts), series 2002 C-2 * Hawaii Housing Community Development Corp., Multifamily Housing Revenue Bonds (Sunset Villas Apts), series 2001A * Hillsborough County Housing Finance Authority, FL, Multifamily Housing Revenue Bonds (Mariner's Cove Apts), series 2002A * Hillsborough County Housing Finance Authority, FL, Multifamily Housing Revenue Bonds (Mariner's Cove Apts), taxable series 2002B * Illinois Housing Development Authority Multifamily Bonds (Turnberry Village II Apts), series 2003 * Miami-Dade County Housing Finance Authority, FL, Multifamily Revenue Bonds (Baywinds Apts), series 2002-1A * Nevada Housing Division, Multi-unit Housing Revenue Bonds (Boulder Creek Project), series 1998A * Nevada Housing Division, Multi-unit Housing Revenue Bonds (Boulder Creek Project), series 1998B * New York State Dormitory Authority, FHA Insured Mortgage Hospital Revenue Bonds (St. Luke's-Roosevelt Hospital Center), series 2000A * Palm Beach County Housing Finance Authority, FL, Multifamily Housing Revenue Bonds (Indian Trace Apts), series 2002A & taxable series 2002B * Raleigh Housing Authority, NC, Ginnie Mae Collateralized Multifamily Revenue Bonds (Overlooke at Simms Creek Apts Project), series 2001 * San Francisco City & County Redevelopment Agency, CA, Multifamily Housing Revenue Bonds (Ginnie Mae Collateralized - 1045 Mission Apts), series 1998C & taxable 1998D * St. Johns County Housing Finance Authority, FL, Multifamily Mortgage Revenue Bonds (Whispering Woods Apts), series 2002 * St. Louis County Industrial Development Authority, MO, Multifamily Housing Bonds (Ginnie Mae Collateralized - Hanley Crossings L.P. Project), series 2000 * Wilson County Health & Educational Facilities, TN, (Douglas Co, Inc.) Multifamily Housing Revenue Refunding Bonds (Ginnie Mae Collateralized Mortgage Loan - Saddlebrook Apts), series 2003 AMERICAN IRONHORSE: Court OKs AIH Acquisition's $8MM Bid -------------------------------------------------------- The United States Bankruptcy Court for the Northern District of Texas approved AIH Acquisition L.L.C.'s stalking-horse bid for substantially all the assets of American IronHorse Motorcycle Company Inc. The debtor supported AIH Acquisition's stalking- horse bid of more than $8 million. The transaction closed on June 4, 2008. AIH Acquisition is a Rocky Mountain Choppers affiliate. Scott Meyers, president and CEO of AIH Acquisition L.L.C., and an American IronHorse dealer in Montana and Minnesota, expressed his enthusiasm for the transaction. "This marks an exciting new beginning for American IronHorse; we will build on the company's achievements to make a superior brand even greater," Mr. Meyers said. Mr. Meyers explained that the success of American IronHorse depends on the loyalty of its family of dealers, customers, and suppliers. "I personally have spoken with dealers, suppliers, and customers across the country during the past several weeks, and their support has been nothing short of remarkable," he said. "It is the confidence they have in American IronHorse that reinforced my own commitment to help American IronHorse emerge from bankruptcy -and to do so as a stronger, leaner company that anticipates the needs and responds to the demands of its customers and dealers." Mr. Meyers has 30 years of operational experience as a senior officer of several Fortune 1000 companies in the defense industry and other sectors. He and his family will be moving to Fort Worth, where he will assume responsibility for running the company. "Along with investing capital in IronHorse, I am investing in the employees of the company and in the Fort Worth community, which will remain our headquarters location," Mr. Meyers added. "The best way to demonstrate my dedication to IronHorse is to work alongside our employees. And the best way I know how to do that is to be in our manufacturing facility and on the road meeting with dealers, suppliers, and IronHorse owners." About Rocky Mountain Choppers and Blackwater Choppers Rocky Mountain Choppers and Blackwater Choppers are dealers of high-end motorcycle brands, including American IronHorse. Rocky Mountain Choppers is located in Gallatin Gateway, Montana. Blackwater Choppers is located in Osseo, Minnesota. About American IronHorse Motorcycle Company Inc. Based in Fort Worth, Texas, American IronHorse Motorcycle Company, Inc., designs, manufactures, and markets custom v-twin motorcycles. AIH markets its motorcycles through a national network of more than 100 dealers and is actively pursuing international sales in Canada and the United Kingdom. On March 25, 2008, American IronHorse consented to the move by a group of creditors to place the company under chapter 11 bankruptcy protection before the United States Bankruptcy Court for the Northern District of Texas, Fort Worth Division. On the same day, the Bankruptcy Court entered an order for relief under Chapter 11 of the U.S. Bankruptcy Code. Three creditors -- AG Nichlos, Jr., William E. Buford and Jim Graham -- filed the involuntary petition against the company on Feb. 29, 2008. The petitioners are owed $120,000 by the company. The petitioner's counsel is Troy D. Philips, Esq., at Glast, Phillips & Murray, PC, in Dallas, Texas. Vincent P. Slusher, Esq., at Beirne Maynard & Parsons, LLP, represents the Debtor. AMERICAN NATURAL: Malone & Bailey Expresses Going Concern Doubt --------------------------------------------------------------- Houston-based Malone & Bailey, PC, raised substantial doubt on the ability of American Natural Energy Corporation to continue as a going concern after it audited the company's financial statements for the year ended Dec. 31, 2007. The auditor reported that the company has incurred substantial losses during 2007 and 2006, has a working capital deficiency and an accumulated deficit at December 31, 2007 and is in default with respect to certain debenture obligations. The management related that the company has no current borrowing capacity with any lender, has sustained substantial losses in 2007 and 2006, totaling up to $3.2 and $2.5 million, respectively, has a working capital deficiency and an accumulated deficit at December 31, 2007 and 2006, and is in default of the payment terms of its 8% convertible secured debentures. The company also has a need for substantial funds to develop its oil and gas properties and repay borrowings as well as to meet its other current liabilities. Certain covenants included in the 8% convertible secured debentures limit the amount of additional indebtedness the company can incur to $2 million. As of May 19, 2008, the Debentures have not been repaid or refinanced and are in default. It is management's intention to raise additional debt or equity financing to either repay or refinance these debentures and to fund its operations and capital expenditures. Failure to obtain additional financing can be expected to adversely affect the company's ability to pay its obligations, further the development of its properties, including the ExxonMobil Corp. area of mutual interest, grow revenues, oil and gas reserves and achieve and maintain a significant level of revenues, cash flows, and profitability 8% Convertible secured debentures On Oct. 21, 2003 and Oct. 31, 2003, the company completed financing transactions of $11.695 million and $305,000, respectively, by issuing Convertible Secured Debentures. The Debentures were repayable on Sept. 30, 2005, with interest payable quarterly commencing Dec. 31, 2003, at 8% per annum. At the dates of issuance, the outstanding principal of the Debentures was convertible by the holders into common shares of the company at any time prior to maturity at a conversion price of $0.45 per share, subject to anti-dilution adjustment, and the Debentures are redeemable by the company at any time after Oct. 1, 2004, if the weighted average price per share on the TSX Venture Exchange for a 20 consecutive trading day period prior to the date notice of redemption is given has exceeded 166-2/3% of the conversion price. During the third quarter of 2004, the company completed a Rights Offering. The anti-dilution adjustment provisions contained in the Debenture Agreement changed the conversion price of the debentures from $0.45 to $0.43 per share and as a result, changed the related Beneficial Conversion Feature by $858,000. The change in the Beneficial Conversion Feature caused the effective rate of the debentures to increase from 55% to 62%. In June 2005, the Debentures were amended with approval by approximately 86% of the Debenture holders. The amendments extended the maturity date of the Debentures by one year to Sept. 30, 2006, reduced through the maturity date of the Debentures the per share price at which the principal of the Debentures could be converted into shares of Common Stock to $0.15 per share, and provided for the partial release of the lien collateralizing the Debentures in the event a third party entered into an agreement with the company pursuant to which the third party is granted the right to drill one or more wells on company properties and commenced that drilling activity. On June 23, 2005, stockholders of the company voted to amend the Certificate of Incorporation to increase the number of shares of Common Stock of the company from 100 million to 250 million and adjust par value from $0.01 to $0.001 per share. This increase in authorized shares, along with the approval of the TSX Venture Exchange to the transactions, provided final approval of the Debenture amendments. Under the amendments, 72,166,667 shares were issuable upon full conversion of the Debentures at the reduced conversion price; however the conversion rights expired on September 29, 2006 and were not renewed. The amendments to the Debentures resulted in the extinguishment of debt and recognition of a loss of $1,147,000. As a result, these Debentures were recorded at their fair market value on June 23, 2005 reflecting the present value of future cash flows and the option value of the underlying convertible shares. The company failed to meet any of the interest payments due quarterly from June 30, 2006, through May 19, 2008, on its outstanding Debentures. In addition, the company failed to repay or redeem the Debentures by the due date of Sept. 30, 2006. As of May 19, 2008, the Debentures are still outstanding. Accordingly, pursuant to the Indenture governing the Debentures, an Event of Default resulting from the company's failure to timely pay interest due on June 30, 2006, occurred and is continuing at this time. The Debentures are collateralized by substantially all of the company's assets. The principal amount of the Debentures outstanding at December 31, 2007 was $10,825,000 and accrued and unpaid interest at that date amounts to $1,515,000. Subsequent to June 30, 2006, through May 19, 2008, neither the Trustee nor the requisite holders of principal amount of Debentures have declared the Debentures to be immediately due and payable and the company remains in default under the interest and repayment terms of its Debentures. During 2007, Dune Energy acquired from the Debenture holders $4,895,000 principal amount of Debentures, bringing Dune Energy's total holdings of the company's Debentures outstanding to $7,895,000 principal amount as of Dec. 31, 2007. Financials The company posted a net loss of $3,229,046 on total revenues of $1,352,889 for the year ended Dec. 31, 2007, as compared with a net loss of $2,451,509 on total revenues of $1,783,208 in the prior year. At Dec. 31, 2007, the company's balance sheet showed $3,626,468 in total assets and $20,117,890 in total liabilities, resulting in $16,491,422 stockholders' deficit. The company's consolidated balance sheet at Dec. 31, 2007, also showed strained liquidity with $274,467in total current assets available to pay $18,364,780 in total current liabilities. A full-text copy of the company's 2007 annual report is available for free at: http://ResearchArchives.com/t/s?2d29 About American Natural Based in Tulsa, Oklahoma, American Natural Energy Corporation (TSX Venture: ANR.U) -- http://www.annrg.com/--was formed in January 2001 to focus on the acquisition, development and exploitation of oil and natural gas reserves. ANEC's objective is to grow an oil and natural gas reserve base through development, exploitation and exploration drilling within the current and future boundaries of its St. Charles Parish, Louisiana properties, including its ExxonMobil Joint Development area. AMORTIZING RESIDENTIAL: Fitch Takes Various Certs. Rating Actions ----------------------------------------------------------------- Fitch Ratings has taken rating actions on the Amortizing Residential Collateral, Lehman HEL, and Structured Asset Securities Corporation mortgage pass-through certificates listed below. Unless stated otherwise, any bonds that were previously placed on Rating Watch Negative are removed. ARC Trust 2001-BC5 -- A1 downgraded to 'AA' from 'AAA'; -- A-IO affirmed at 'AAA'; -- M1 downgraded to 'CC/DR3' from CCC/DR2'; -- M2 revised to 'C/DR6' from 'C/DR5'; Deal Summary -- 60+ day Delinquency: 41.90% -- Realized Losses to date (% of Original Balance): 2.43% ARC Trust 2001-BC6 -- A affirmed at 'AAA'; -- M-1 affirmed at 'B'; -- M-2 downgraded to 'C/DR5' from 'B-/DR1'; Deal Summary -- 60+ day Delinquency: 37.38% -- Realized Losses to date (% of Original Balance): 2.61% ARC Trust 2002-BC1 -- A affirmed at 'AAA'; -- M-1 downgraded to 'BB+' from 'A-'; -- M-2 downgraded to 'B+' from 'BB+'; -- B downgraded to 'B+' from 'BB+'; Deal Summary -- 60+ day Delinquency: 35.99% -- Realized Losses to date (% of Original Balance): 2.10% ARC Trust 2002-BC3 -- A affirmed at 'AAA'; -- M1 downgraded to 'A-' from 'AA'; -- M2 downgraded to 'B' from 'BBB'; -- B-1 downgraded to 'C/DR6' from 'BB+'; Deal Summary -- 60+ day Delinquency: 27.53% -- Realized Losses to date (% of Original Balance): 1.58% ARC Trust 2002-BC5 -- M1 affirmed at 'AA'; -- M2 affirmed at 'A'; -- M3 downgraded to 'BB+' from 'BBB'; Deal Summary -- 60+ day Delinquency: 25.75% -- Realized Losses to date (% of Original Balance): 2.42% ARC Trust 2002-BC6 Total -- A1 affirmed at 'AAA'; -- A2 affirmed at 'AAA'; -- A4 affirmed at 'AAA'; -- A-IO affirmed at 'AAA'; -- M1 downgraded to 'A-' from 'AA-'; -- M2 affirmed at 'B'; -- M3 downgraded to 'C/DR6' from 'CC/DR3'; -- B revised to 'C/DR6' from 'C/DR5'; Deal Summary -- 60+ day Delinquency: 33.90% -- Realized Losses to date (% of Original Balance): 2.35% ARC Trust 2002-BC7 TOTAL -- A-1 affirmed at 'AAA'; -- A-IO affirmed at 'AAA'; -- A-SIO affirmed at 'AAA'; -- M-1 downgraded to 'A-' from 'A'; -- M-2 downgraded to 'BBB' from 'BBB+'; -- M-3 downgraded to 'BB' from 'BBB'; -- M-4 downgraded to 'B+' from 'BB+'; -- M-5 downgraded to 'B+' from 'BB'; -- M-6 downgraded to 'B' from 'BB-'; -- B-1 downgraded to 'C/DR6' from 'B'; -- B-2 downgraded to 'C/DR6' from 'B'; -- B-3 downgraded to 'C/DR6' from 'B'; Deal Summary -- 60+ day Delinquency: 42.85% -- Realized Losses to date (% of Original Balance): 2.67% ARC Trust 2002-BC8 TOTAL -- A-1 affirmed at 'AAA'; -- A-3 affirmed at 'AAA'; -- A-IO affirmed at 'AAA'; -- A-SIO affirmed at 'AAA'; -- M-1 downgraded to 'A' from 'AA'; -- M-2 downgraded to 'BB+' from 'BBB+'; -- M-3 downgraded to 'B' from 'BB'; -- M-4 downgraded to 'C/DR5' from 'BB-'; Deal Summary -- 60+ day Delinquency: 31.80% -- Realized Losses to date (% of Original Balance): 2.09% ARC Trust 2002-BC9 TOTAL -- M1 downgraded to 'A' from 'AA'; -- M2 downgraded to 'BB' from 'A'; -- M3 downgraded to 'C/DR5' from 'BBB-'; -- M4 downgraded to 'C/DR6' from 'B+'; -- B downgraded to 'C/DR6' from 'B'; Deal Summary -- 60+ day Delinquency: 37.37% -- Realized Losses to date (% of Original Balance): 2.11% ARC Trust 2002-BC10 Total -- M2 revised to 'C/DR6' from 'C/DR4'; -- M3 remains at 'C/DR6'; Deal Summary -- 60+ day Delinquency: 32.28% -- Realized Losses to date (% of Original Balance): 1.97% Lehman HEL Trust 1998-1 -- A-1 affirmed at 'AAA'; -- M-1 affirmed at 'CCC/DR2'; -- M-2 remains at 'C/DR6'; Deal Summary -- 60+ day Delinquency: 4.91% -- Realized Losses to date (% of Original Balance): 3.21% Lehman HEL Trust 1998-2 -- A-2 affirmed at 'AAA'; -- M-1 affirmed at 'AA+'; -- M-2 affirmed at 'AA-'; -- B affirmed at 'A'; Deal Summary -- 60+ day Delinquency: 28.38% -- Realized Losses to date (% of Original Balance): 3.18% SASCO 1998-2 -- A affirmed at 'AAA'; -- M-1 affirmed at 'AA'; Deal Summary -- 60+ day Delinquency: 32.11% -- Realized Losses to date (% of Original Balance): 4.25% SASCO 1998-3 -- M1 affirmed at 'AA'; Deal Summary -- 60+ day Delinquency: 38.61% -- Realized Losses to date (% of Original Balance): 3.30% SASCO 1998-8 -- A-3 affirmed at 'AAA'; -- M-1 affirmed at 'A-'; -- M-2 affirmed at 'BBB-'; Deal Summary -60+ day Delinquency: 35.16% -- Realized Losses to date (% of Original Balance): 4.20% SASCO 1999-SP1 POOLS 1,2 & 3 -- A1 affirmed at 'AAA'; -- A2 affirmed at 'AAA'; -- M1 affirmed at 'AA'; -- M2 affirmed at 'A'; -- B affirmed at 'BB+'; Deal Summary -- 60+ day Delinquency: 31.53% -- Realized Losses to date (% of Original Balance): 8.80% SASCO Series 2002-BC1 -- M2 affirmed at 'BBB+'; -- M3 revised to 'CC/DR4' from 'CC/DR2'; Deal Summary -- 60+ day Delinquency: 39.54% -- Realized Losses to date (% of Original Balance): 3.83% SASCO Series 2002-HF2 -- M1 affirmed at 'AAA'; -- M2 affirmed at 'AA-'; -- M3 affirmed at 'BBB-'; -- B1 downgraded to 'B' from 'BB'; -- B2 revised to 'C/DR6' from C/DR4'; Deal Summary -- 60+ day Delinquency: 37.93% -- Realized Losses to date (% of Original Balance): 6.37% AMRESCO RESIDENTIAL: Fitch Takes Rating Actions on 13 Certificates ------------------------------------------------------------------ Fitch Ratings has taken rating actions on 13 AMRESCO Residential Securities Corporation mortgage pass-through certificates. Unless stated otherwise, any bonds that were previously placed on Rating Watch Negative are now removed. AMRESCO 1997-1 Group 1 -- Class A-7 affirmed at 'AAA'; -- Class A-8 affirmed at 'AAA'; -- Class M1-F affirmed at 'AA+'; -- Class M2-F affirmed at 'A+'; Deal Summary -- 60+ day Delinquency: 13.63% -- Realized Losses to date (% of Original Balance): 4.22% AMRESCO 1997-1 Group 2 -- Class M-1A affirmed at 'AAA'; Deal Summary -- 60+ day Delinquency: 70.79% -- Realized Losses to date (% of Original Balance): 4.90% AMRESCO 1997-2 Group 1 -- Class A-7 affirmed at 'AAA'; -- Class A-8 affirmed at 'AAA'; -- Class M-1F affirmed at 'AA+'; -- Class M-2F affirmed at 'A+'; Deal Summary -- 60+ day Delinquency: 28.86% -- Realized Losses to date (% of Original Balance): 5.27% AMRESCO 1997-2 Group 2 -- Class M-1A affirmed at 'AA+'; Deal Summary -- 60+ day Delinquency: 9.52% -- Realized Losses to date (% of Original Balance): 5.12% AMRESCO 1997-3 Group 1 -- Class A-8 affirmed at 'AAA'; -- Class A-9 affirmed at 'AAA'; -- Class M1F downgraded to 'BBB+' from 'AA'; -- Class M2F downgraded to 'BB' from 'BBB'; -- Class B1F downgraded to 'C/DR6' from 'CC/DR4'; -- Class B2F remains at 'C/DR6'; Deal Summary -- 60+ day Delinquency: 33.06% -- Realized Losses to date (% of Original Balance): 6.11% AMRESCO 1997-3 Group 2 -- Class M1A affirmed at 'AA'; Deal Summary -- 60+ day Delinquency: 39.25% -- Realized Losses to date (% of Original Balance): 4.72% AMRESCO 1998-1 Group 1 -- Class A-5 affirmed at 'AAA'; -- Class A-6 affirmed at 'AAA'; -- Class M1-F downgraded to 'A' from 'AA'; -- Class M2-F downgraded to 'BB+' from 'BBB'; -- Class B1-F remains at 'CCC/DR2'; Deal Summary -- 60+ day Delinquency: 26.75% -- Realized Losses to date (% of Original Balance): 9.38% AMRESCO 1998-1 Group 2 -- Class M1-A affirmed at 'AA'; Deal Summary -- 60+ day Delinquency: 28.35% -- Realized Losses to date (% of Original Balance): 7.63% AMRESCO 1998-2 Group 1 -- Class A-5 affirmed at 'AAA'; -- Class A-6 affirmed at 'AAA'; -- Class M1F downgraded to 'A+' from 'AA'; -- Class M2F downgraded to 'BBB' from 'A'; -- Class B1F downgraded to 'BB' from 'BBB'; Deal Summary -- 60+ day Delinquency: 30.43% -- Realized Losses to date (% of Original Balance): 6.14% AMRESCO 1998-2 Group 2 -- Class M1A affirmed at 'AA'; -- Class M2A affirmed at 'A'; Deal Summary -- 60+ day Delinquency: 35.17% -- Realized Losses to date (% of Original Balance): 5.43% AMRESCO 1998-3 Group 1 -- Class A-5 affirmed at 'AAA'; -- Class A-6 affirmed at 'AAA'; -- Class B1F revised to 'C/DR5' from C/DR4'; Deal Summary -- 60+ day Delinquency: 24.56% -- Realized Losses to date (% of Original Balance): 7.13% AMRESCO 1998-3 Group 2 -- Class A-7 affirmed at 'AAA'; -- Class M1A affirmed at 'AA'; -- Class M2A affirmed at 'A'; -- Class B1A affirmed at 'BBB'; Deal Summary -- 60+ day Delinquency: 36.94% -- Realized Losses to date (% of Original Balance): 5.96% AMRESCO 1999-1 -- Class A affirmed at 'AAA'; -- Class M-1 downgraded to 'BBB+' from 'A+'; -- Class M-2 downgraded to 'BB' from 'BBB'; -- Class B revised to 'C/DR5' from C/DR4'; Deal Summary -- 60+ day Delinquency: 40.62% -- Realized Losses to date (% of Original Balance): 11.53% ASARCO LLC: Examiner Wants to Retain Warner Stevens --------------------------------------------------- Michael D. Warner, the examiner appointed by the U.S. Trustee in relation to ASARCO LLC and its debtor-affiliates' Chapter 11 cases, sought and obtained the Court's authority to retain Warner Stevens, L.L.P., as its counsel. According to the Examiner, the employment of a counsel is needed to effectively and efficiently perform his duties required of the Examiner and to utilize his Examiner's time. Mr. Warner adds that the Examiner also requires the assistance of a counsel to engage in confidential conversations with various parties-in- interest regarding the Plan Sponsor Selection process. For their services, Warner Stevens will be paid based on its current hourly rates: Professional Hourly Rates ------------ ------------ Partners $375 to $475 Associates $240 to $350 Paralegals $125 Two Warner Stevens professionals will take the lead role in providing legal advise to the Examiner: David T. Cohen $450 per hour Kerri Labrada $125 per hour Warner Stevens will not charge the Examiner for telephone and fax charges, in-house photocopying or postage. Warner Stevens will also not charge the Examiner or the Debtors' estates for travel time unless its professionals are performing billable services for the Examiner during those travels. David T. Cohen, Esq., a partner at Warner Stevens, L.L.P., assures the Court that his firm does not represent any interest adverse to the Debtors or their estates, and is a disinterested person as defined in Section 101(14) of the Bankruptcy Code. Its employment satisfies the requirements of disinterestedness of Section 327, Mr. Cohen says. The Examiner, pursuant to Section 101(14), discloses that: (a) Contrarian Funds, LLC, is a transferee of claims in the Debtors' Chapter 11 cases. Contrarian was a client of Warner Stevens in matters wholly unrelated to the Debtors and the Debtors' Chapter 11 cases, which matters were concluded prior to Mr. Warner's appointment as examiner for the Debtors' Chapter 11 cases; (b) ASM Capital, L.P., a transferee of claims in the Debtors' chapter 11 cases, is a client of Warner Stevens in matters wholly unrelated to the Debtors and their Chapter 11 cases. Warner Stevens does not and will not represent ASM in the Debtors' chapter 11 cases; and (c) The law firm of Gordon Mott and Davis P.C., formerly known as Gordon and Mott, P.C., and its partner H. Christopher Mott are counsel for the city of El Paso in the Debtors' Chapter 11 cases. Warner Stevens represents Harrel L. Davis, III, a partner of Gordon Mott, in his capacity as Chapter 7 Trustee In re One Travel Holdings, Inc. et al, Case No. 06-70085 currently pending in the U.S. Bankruptcy Court for the Western District of Texas. Mr. Warner does not believe that there is any connection between the OneTravel Chapter 7 case the Debtors' Chapter 11 cases. About ASARCO Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/ -- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. The Company filed for chapter 11 protection on Aug. 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207). James R. Prince, Esq., Jack L. Kinzie, Esq., and Eric A. Soderlund, Esq., at Baker Botts L.L.P., and Nathaniel Peter Holzer, Esq., Shelby A. Jordan, Esq., and Harlin C. Womble, Esq., at Jordan, Hyden, Womble & Culbreth, P.C., represent the Debtor in its restructuring efforts. Lehman Brothers Inc. provides ASARCO with financial advisory services And investment banking services. Paul M. Singer, Esq., James C. McCarroll, Esq., and Derek J. Baker, Esq., at Reed Smith LLP give legal advice to the Official Committee of Unsecured Creditors and David J. Beckman at FTI Consulting, Inc., gives financial advisory services to the Committee. When the Debtor filed for protection from its creditors, it listed $600 million in total assets and $1 billion in total debts. The Debtor has five affiliates that filed for chapter 11 protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521 through 05-20525). They are Lac d'Amiante Du Quebec Ltee, CAPCO Pipe Company, Inc., Cement Asbestos Products Company, Lake Asbestos of Quebec, Ltd., and LAQ Canada, Ltd. Details about their asbestos-driven chapter 11 filings have appeared in the Troubled Company Reporter since April 18, 2005. Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle, Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No. 05- 21346) also filed for chapter 11 protection, and ASARCO has asked that the three subsidiary cases be jointly administered with its chapter 11 case. On Oct. 24, 2005, Encycle/Texas' case was converted to a Chapter 7 liquidation proceeding. The Court appointed Michael Boudloche as Encycle/Texas, Inc.'s Chapter 7 Trustee. Michael B. Schmidt, Esq., and John Vardeman, Esq., at Law Offices of Michael B. Schmidt represent the Chapter 7 Trustee. ASARCO's affiliates, AR Sacaton LLC, Southern Peru Holdings LLC, and ASARCO Exploration Company Inc., filed for Chapter 11 protection on Dec. 12, 2006 (Bankr. S.D. Tex. Case No. 06-20774 to 06-20776). ASARCO and its debtor affiliates are scheduled to file a plan of reorganization on June 10, 2008. (ASARCO Bankruptcy News, Issue No. 73; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). ASARCO LLC: Wants to Expand Keegan's Insurance Coverage Services ---------------------------------------------------------------- ASARCO LLC and its debtor-affiliates seek authority from the U.S. Bankruptcy Court for the Southern District of Texas to further expand the scope of employment of Keegan, Linscott & Kenon, P.C., to include professional consulting services in connection with pending insurance coverage actions. Luckey R. McDowell, Esq., at Baker Botts L.L.P., in Dallas, Texas, tells the Court that ASARCO believes that Keegan is well- positioned to provide professional consulting services in connection with pending insurance coverage action in light of: -- the substantial accounting services Keegan performed for ASARCO before and during its bankruptcy case; -- Keegan's familiarity with the Debtors' financial situation; -- Keegan's services to the Debtors in claims reconciliation analysis; and -- Keegan's knowledge of the Debtors' businesses and creditors and the Material Inventory Management System that ASARCO uses. For services related to the insurance coverage litigation, ASARCO will pay Keegan $75 to $250 per hour depending on the individual who performs the service. ASARCO will also reimburse Keegan for actual costs and expenses incurred in connection with its pending insurance coverage services. Keegan's director, Christopher Linscott, assures the Court that his firm does not have any interest adverse to the Debtors or their bankruptcy estates. Mr. Linscott declares further that Keegan is a "disinterested person" as the term is defined in Section 101(14) of the U.S. Bankruptcy Code, as modified by Section 1107(b). About ASARCO Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/ -- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. The Company filed for chapter 11 protection on Aug. 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207). James R. Prince, Esq., Jack L. Kinzie, Esq., and Eric A. Soderlund, Esq., at Baker Botts L.L.P., and Nathaniel Peter Holzer, Esq., Shelby A. Jordan, Esq., and Harlin C. Womble, Esq., at Jordan, Hyden, Womble & Culbreth, P.C., represent the Debtor in its restructuring efforts. Lehman Brothers Inc. provides ASARCO with financial advisory services And investment banking services. Paul M. Singer, Esq., James C. McCarroll, Esq., and Derek J. Baker, Esq., at Reed Smith LLP give legal advice to the Official Committee of Unsecured Creditors and David J. Beckman at FTI Consulting, Inc., gives financial advisory services to the Committee. When the Debtor filed for protection from its creditors, it listed $600 million in total assets and $1 billion in total debts. The Debtor has five affiliates that filed for chapter 11 protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521 through 05-20525). They are Lac d'Amiante Du Quebec Ltee, CAPCO Pipe Company, Inc., Cement Asbestos Products Company, Lake Asbestos of Quebec, Ltd., and LAQ Canada, Ltd. Details about their asbestos-driven chapter 11 filings have appeared in the Troubled Company Reporter since April 18, 2005. Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle, Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No. 05- 21346) also filed for chapter 11 protection, and ASARCO has asked that the three subsidiary cases be jointly administered with its chapter 11 case. On Oct. 24, 2005, Encycle/Texas' case was converted to a Chapter 7 liquidation proceeding. The Court appointed Michael Boudloche as Encycle/Texas, Inc.'s Chapter 7 Trustee. Michael B. Schmidt, Esq., and John Vardeman, Esq., at Law Offices of Michael B. Schmidt represent the Chapter 7 Trustee. ASARCO's affiliates, AR Sacaton LLC, Southern Peru Holdings LLC, and ASARCO Exploration Company Inc., filed for Chapter 11 protection on Dec. 12, 2006 (Bankr. S.D. Tex. Case No. 06-20774 to 06-20776). ASARCO and its debtor affiliates are scheduled to file a plan of reorganization on June 10, 2008. (ASARCO Bankruptcy News, Issue No. 73; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). ASARCO LLC: Employees Given Until July 26 to File Severance Claims ------------------------------------------------------------------ ASARCO LLC and its debtor-affiliates are giving entities or individuals who have a claim against or are owed money by a Debtors related to a 2003 Severance Pay Plan or the Grupo Service Credit Representation until July 26, 2008, to file a proof of claim. ASARCO LLC notified the Court that on April 2, 2008, it terminated the "Severance Pay Plan for Salaried Employees of ASARCO Incorporated as Amended through March 31, 2003" retroactive to August 31, 2007. ASARCO believes that Claims may have arisen prior to or as a result of the termination of the 2003 Severance Pay Plan. Prior to the date of bankruptcy, Grupo Mexico S.A. de C.V., and its affiliates, including Servicios de Apoyo Administrativo, S.A. de C.V., may have asked some of their employees to transfer to Asarco Incorporated, predecessor in interest of ASARCO LLC. The Debtors told the Court that some of those employees assert that, to induce them to transfer employment, Grupo promised that Asarco Inc. would honor their seniority with Grupo for all purposes including with respect to crediting their years of service for purposes of the "Retirement Benefit Plan For Salaried Employees of Asarco Incorporated - Amended and Restated Effective as of July 1, 2002." About ASARCO Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/ -- is an integrated copper mining, smelting and refining company. Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. The Company filed for chapter 11 protection on Aug. 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207). James R. Prince, Esq., Jack L. Kinzie, Esq., and Eric A. Soderlund, Esq., at Baker Botts L.L.P., and Nathaniel Peter Holzer, Esq., Shelby A. Jordan, Esq., and Harlin C. Womble, Esq., at Jordan, Hyden, Womble & Culbreth, P.C., represent the Debtor in its restructuring efforts. Lehman Brothers Inc. provides ASARCO with financial advisory services And investment banking services. Paul M. Singer, Esq., James C. McCarroll, Esq., and Derek J. Baker, Esq., at Reed Smith LLP give legal advice to the Official Committee of Unsecured Creditors and David J. Beckman at FTI Consulting, Inc., gives financial advisory services to the Committee. When the Debtor filed for protection from its creditors, it listed $600 million in total assets and $1 billion in total debts. The Debtor has five affiliates that filed for chapter 11 protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521 through 05-20525). They are Lac d'Amiante Du Quebec Ltee, CAPCO Pipe Company, Inc., Cement Asbestos Products Company, Lake Asbestos of Quebec, Ltd., and LAQ Canada, Ltd. Details about their asbestos-driven chapter 11 filings have appeared in the Troubled Company Reporter since April 18, 2005. Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle, Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No. 05- 21346) also filed for chapter 11 protection, and ASARCO has asked that the three subsidiary cases be jointly administered with its chapter 11 case. On Oct. 24, 2005, Encycle/Texas' case was converted to a Chapter 7 liquidation proceeding. The Court appointed Michael Boudloche as Encycle/Texas, Inc.'s Chapter 7 Trustee. Michael B. Schmidt, Esq., and John Vardeman, Esq., at Law Offices of Michael B. Schmidt represent the Chapter 7 Trustee. ASARCO's affiliates, AR Sacaton LLC, Southern Peru Holdings LLC, and ASARCO Exploration Company Inc., filed for Chapter 11 protection on Dec. 12, 2006 (Bankr. S.D. Tex. Case No. 06-20774 to 06-20776). ASARCO and its debtor affiliates are scheduled to file a plan of reorganization on June 10, 2008. (ASARCO Bankruptcy News, Issue No. 73; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). AVANI INT'L: Posts $109,795 Net Loss in 2008 First Quarter ---------------------------------------------------------- Avani International Group Inc. reported a net loss of $109,759 for the first quarter ended March 31, 2008, compared with a net loss of $70,318 for the same period ended March 31, 2007. At March 31, 2008, the company's consolidated balance sheet showed $1,143,492 in total assets, $1,104,325 in total liabilities, and $39,167 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?2d75 Going Concern Doubt Jeffrey Tsang & Co., in Hong Kong, expressed substantial doubt about Avani International Group Inc.'s ability to continue as a going concern after auditing the 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. About Avani International Based in West Vancouver, B.C. , Canada, Avani International Group Inc. (OTC: AVIT) is seeking a joint venture partner or licensee in the Far East, mainly Malaysia, for the purpose of re-commencing operations utilizing the company's oxygenated equipment. Under this arrangement, the company expects that its licensee or joint venture partner will engage in the actual manufacture and sale of its oxygenated product, subject to the payment of a yet to be determined royalty to the company. As of Dec. 31, 2007, the company had not entered into any binding arrangements regarding its proposed joint venture or licensee arrangements. The company previously constructed a bottling facility and engaged in the business of bottling and distributing a bottled water product under the trade name Avani Water, which is oxygen enriched, purified bottled water produced from technology developed by the company. ASSET BACK: Fitch Holds Junked Ratings on Two Certificate Classes ----------------------------------------------------------------- Fitch Ratings has taken rating actions on Asset Back Funding Corp. Unless stated otherwise, any bonds that were previously placed on Rating Watch Negative are removed. Series Trust 2001-AQ1 -- A6 affirmed at 'AAA'; -- A7 affirmed at 'AAA'; -- M-1 affirmed at 'AA'; -- M-2 affirmed at 'BB'; -- B affirmed at 'CC/DR2'. Deal Summary -- Originators: Ameriquest Mortgage Company -- 60+ day Delinquency: 15.27% -- Realized Losses to date (% of Original Balance): 2.92% Series 2002-SB1 -- AII-1 affirmed at 'AAA'; -- M-1 downgraded to 'A' from 'AA'; -- M-2 downgraded to 'B' from 'BBB'; -- M-3 downgraded to 'C/DR5' from 'B-', Deal Summary -- Originators: Superior Federal Bank, FSB -- 60+ day Delinquency: 30.4% -- Realized Losses to date (% of Original Balance): 6.67% Series 2002-NC1 -- M-1 downgraded to 'A' from 'AA'; -- M-2 downgraded to 'BB' from 'BBB+'; -- M-3 downgraded to 'C/DR6' from 'B'; -- M-4 affirmed at 'C/DR6'; Deal Summary -- Originators: New Century Mortgage Corporation -- 60+ day Delinquency: 37.06% -- Realized Losses to date (% of Original Balance): 2.25% Series 2002-OPT1 -- M-1 downgraded to 'AA-' from 'AA+'; -- M-2 downgraded to 'A' from 'AA'; -- M-3 downgraded to 'BBB' from 'A+'; -- M-4 downgraded to 'BB+' from 'A-'; -- M-5 downgraded to 'BB' from 'BBB+' Deal Summary -- Originators: Option One Mortgage Corporation -- 60+ day Delinquency: 32.35% -- Realized Losses to date (% of Original Balance): 1.77% Series 2002-WF1 -- M-1 affirmed at 'AA'; -- M-2 affirmed at 'A'; -- M-3 affirmed at 'BBB-'; -- B affirmed at 'B+', Deal Summary -- Originators: Wells Fargo Home Mortgage, Inc. -- 60+ day Delinquency: 27.91% -- Realized Losses to date (% of Original Balance): 1.91% Series 2002-WF2 -- A-2 affirmed at 'AAA'; -- M-1 affirmed at 'AAA'; -- M-2 affirmed at 'A+'; -- M-3 affirmed at 'BBB', Deal Summary -- Originators: Wells Fargo Home Mortgage, Inc. -- 60+ day Delinquency: 16.68% -- Realized Losses to date (% of Original Balance): 1.38% AXESSTEL INC: Earns $256,658 in 2008 First Quarter Ended March 30 ----------------------------------------------------------------- Axesstel Inc. reported net income of $256,658, on revenues of $24,636,937, for the first quarter ended March 31, 2008, compared with a net loss of $1,248,935, on revenues of $25,189,776, for the same period ended April 1, 2007. For the first quarter of 2008, cost of goods sold was $18,034,479 compared to $20,618,273 for the first quarter of 2007, a decrease of 13%. This decrease to cost of goods sold is largely attributable to the favorable product mix of data product revenue over the comparative periods. Cost of materials declined on a per unit basis in 2008 as the company was able to re-engineer its products to take advantage of cost efficient alternate parts, and reduce prices with the company's suppliers. For the first quarter of 2008, interest and other expense was $568,631 compared to $50,868 for the first quarter of 2007. At March 30, 2008, the company's consolidated balance sheet showed $36,630,589 in total assets, $35,212,160 in total liabilities, and $1,418,429 in total stockholders' equity. Balance Sheet The company's consolidated balance sheet at March 31, 2008, also showed strained liquidity with $32,919,891 in total current assets available to pay $35,212,160 in total current liabilities. 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?2d65 Going Concern Doubt As reported in the Troubled Company Reporter on April 18, 2008, Gumbiner Savett Inc., in Santa Monica, Calif., expressed substantial doubt about Axesstel 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 reported that the company has incurred substantial recurring losses from operations, the company's current liabilities exceed its current assets, and the company may not have sufficient working capital or outside financing available to meet its planned operating activities over the next twelve months. About Axesstel Headquartered in San Diego, Calif., Axesstel Inc. (AMEX: AFT) -- http://www.axesstel.com/-- designs and develops fixed wireless voice and broadband data products. Axesstels product portfolio includes wireless web computers, broadband modems, 3G gateways, voice/data terminals, fixed wireless desktop phones and public call office phones for access to online computing, high-speed data and voice calling services. Axesstel has a research and development center in Seoul, South Korea. BEAR STEARNS: Mortgage Biz Sold to LoneStar for Undisclosed Price ----------------------------------------------------------------- Lone Star Funds has acquired "certain operating assets" from Bear Stearns Cos.' residential mortgage unit -- Bear Stearns Residential Mortgage Corp. -- for an undisclosed sum, various reports say. According to Bloomberg News, Lone Star spokesman Ed Trissel confirmed the transaction in an e-mailed statement May 30, 2008. Mr. Trissel said the fund manager also purchased the rights to other assets, the report says. Lone Star bought subprime lender Accredited Home Lenders Holding Co. for about $296,000,000 in October, Bloomberg says. About Lone Star Funds Lone Star Funds -- http://www.lonestarfunds.com/-- is a U.S. private equity firm. Since 1995, the principals of Lone Star have organized private equity funds totaling more than $13.3 billion to invest globally in corporate secured and unsecured debt instruments, real estate related assets and select corporate opportunities. About Bear Stearns New York City-based The Bear Stearns Companies Inc. (NYSE: BSC) -- http://www.bearstearns.com/-- is a leading financial services firm serving governments, corporations, institutions and individuals worldwide. The company's core business lines include institutional equities, fixed income, investment banking, global clearing services, asset management, and private client services. The company has approximately 14,000 employees worldwide. As reported by the Troubled Company Reporter, Bear Stearns stockholders approved the investment bank's merger with JPMorgan Chase & Co. at a Special Meeting of Stockholders held May 29, 2008. Approximately 84% of shares voted were in favor of the merger, representing a substantial majority of Bear Stearns' outstanding common stock. The Wall Street Journal reports that the value of the transaction is about $1.4 billion, a large difference from the $25 billion market capitalization value in early 2007 before its defeat. Upon completion of the merger, each outstanding share of common stock of Bear Stearns will be converted into the right to receive 0.21753 shares of JPMorgan Chase common stock and Bear Stearns will become a direct subsidiary of JPMorgan Chase. * * * As reported in the Troubled Company Reporter on Dec. 28, 2007, Fitch Ratings' affirmed its Negative Outlook for The Bear Stearns Companies Inc. following the announcement of the company's fiscal year earnings for 2007. On Nov. 14, 2007, Fitch affirmed Bear Stearns' long-term credit ratings, along with its subsidiaries. Fitch also downgraded the short-term rating to 'F1' from 'F1+', and Individual rating to 'B/C' from 'B'. About Accredited Home Headquartered in San Diego, California, Accredited Home Lenders Holding Co. (NASDAQ:LEND) -- http://www.accredhome.com/-- is a mortgage company operating throughout the U.S. and in Canada. Founded in 1990, the company originates, finances, securitizes, services, and sells non-prime mortgage loans secured by residential real estate. BGF INDUSTRIES: Moody's Withdraws Junk Ratings ---------------------------------------------- Moody's Investors Service withdrew its ratings on BGF Industries, Inc. Moody's has withdrawn the ratings because BGF's rated debt has been repaid. Specifically, on March 27, 2008, the company used proceeds from a new loan agreement to redeem the senior subordinated notes due 2009 These ratings were withdrawn: * Corporate family rating at Caa2; * Probability-of-default rating at Caa2; * Senior subordinated notes due 2009 at Caa3 (LGD4, 67%). Headquartered in Greensboro, North Carolina, BGF is a leading North American manufacturer of value-added specialty woven and non-woven glass fiber fabrics, composite fabrics, and insulating felts. BLACK GAMING: S&P Places 'B-' Rating Under Negative CreditWatch --------------------------------------------------------------- Standard & Poor's Ratings Services placed its ratings on Black Gaming LLC, including the 'B-' corporate credit rating, on CreditWatch with negative implications. "The CreditWatch listing stems from our concern about the company's weakening liquidity position, as challenging operating conditions continue to negatively affect earnings," explained Standard & Poor's credit analyst Melissa Long. "In resolving the CreditWatch listing, we will assess management's near-term operating and financial strategies." BLOUNT FAMILY: Case Summary & 19 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Blount Family Dental Center, P.C. 2929 Turner Hill Road Lithonia, GA 30038 Bankruptcy Case No.: 08-70633 Type of Business: The Debtor is a dental center. Chapter 11 Petition Date: June 3, 2008 Court: Northern District of Georgia (Atlanta) Judge: Paul W. Bonapfel Debtor's Counsel: James D. Key, Esq. P.O. Box 673141 Marietta, GA 30006 Tel: (770) 953-8174 Estimated Assets: $50,001 to $100,000 Estimated Debts: $1 million to $10 million Debtor's list of its 19 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Select Leasing Judgment $700,000 1010 Norm 500 East, Suite 105 North Salt Lake, UT 84054 ODC, Inc. Judgment on $400,000 3850 North Caulsways Boulevard Contract Suite 800 Metairie, LA 70002 Internal Revenue Service Taxes $150,000 Centralized Insolvency Ops. P.O. Box 21126 Philadelphia, PA 19114 G E Healthcare Contract $150,000 P.O. Box 414418 Boston, MA 02241 Simpson Law Office Trade Collection $9,000 Carson Dental Contract $8,000 Burley Dental Trade $5,100 Dekalb County Tax Taxes $4,700 Sunshine Media - Advertising Advertising Contract $4,000 ADP Contract $3,700 Cebevond Contract $3,000 Cerinate Lab Trade $1,800 Stericycle Waste Trade $1,800 Top Quality Gloves Trade $900 Brassler-Lab Trade $800 Georgia Power Utilities $700 TRS Collection $650 Your Answering Service Trade $200 Airgas Nitrous Trade $150 BLUE SKY: Case Summary & 11 Largest Unsecured Creditors ------------------------------------------------------- Debtor: Blue Sky Mountain Co., Inc. 6310 Parson Brown Drive Orlando, FL 32819 Bankruptcy Case No.: 08-10433 Chapter 11 Petition Date: June 4, 2008 Court: Western District of North Carolina (Asheville) Judge: George R. Hodges Debtor's Counsel: D. Rodney Kight, Jr., Esq. Kight Law Office 9 SW Pack Square, Suite 200 Asheville, NC 28801 Tel: (828) 255-9881 Fax: (828) 255-9886 E-mail: info@kightlaw.com Total Assets: $31,095,300 Total Debts: $6,171,094 Debtor's list of its 11 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Wolf Mountain Grading Business Debt $270,138 120 Nomad Drive Tuckasegee, NC 28783 Canin Associates Business Debt $30,441 500 Delaney Avenue Orlando, FL 32810 Coastline Studios Business Debt $23,301 322 E. Pine Street Orlando, FL 32801 WNC-PE & S, LLC Business Debt $14,595 Bank of America Consumer Debt $11,595 Crane Bros. Well Drilling, Inc. Business Debt $11,580 Jackson County Tax Collector Taxes $11,224 Fish and Wildlife Associates Inc Business Debt $8,064 Geller, Ragans, James, Business Debt $3,686 Oppenheimer & Creel Sonitrol Leasing $692 Wolff, Hill, McFarlin & Herron, Business Debt $535 PA BRIGHTON LLC: Case Summary & 6 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Brighton, LLC 415 W. Eleven Mile Road Madison Heights, MI 48071 Bankruptcy Case No.: 08-52984 Chapter 11 Petition Date: May 29, 2008 Court: Eastern District of Michigan (Detroit) Judge: Marci B. McIvor Debtors' Counsel: Robert N. Bassel, Esq. 201 W. Big Beaver 6th Floor Troy, MI 48099 Tel: (248) 528-1111 E-mail: robert.bassel@kkue.com Estimated assets: $1 million to $10 million Estimated debts: $1 million to $10 million A list of the Debtor's six largest unsecured creditors is available at no charge at http://bankrupt.com/misc/mieb08-52984.pdf C-BASS: Fitch Chips Ratings on Two Certificate Classes to BB ------------------------------------------------------------ Fitch Ratings has taken rating actions on Credit Based Asset Servicing and Securitization LLC mortgage pass-through certificates. Unless stated otherwise, any bonds that were previously placed on Rating Watch Negative are removed from Rating Watch Negative. C-BASS 1998-1 Group 1 -- 1A affirmed at 'AAA'; -- 1B affirmed at 'AAA'; -- 1C affirmed at 'AAA'; -- 1D affirmed at 'AA'; -- 1E affirmed at 'A'; Deal Summary -- 60+ day Delinquency: 2.90% -- Realized Losses to date (% of Original Balance): 0.37% C-BASS 1999-CB1 Group 1 -- 1A downgraded to 'A' from 'AAA'; -- A-PO downgraded to 'A' from 'AAA'; -- 1M-1 downgraded to 'A-' from 'AAA'; -- 1M-2 downgraded to 'BBB' from 'AA'; -- 1M-3 downgraded to 'BB' from 'A'; Deal Summary -- 60+ day Delinquency: 18.22% -- Realized Losses to date (% of Original Balance): 2.52% C-BASS 1999-CB2 Group 1 -- 1A downgraded to 'A-' from 'AAA'; -- 1A-IO affirmed at 'AAA'; -- A-PO downgraded to 'A-' from 'AAA'; -- 1M-1 downgraded to 'BBB+' from 'AAA'; -- 1M-2 downgraded to 'BB+' from 'AA'; -- 1M-3 downgraded to 'B' from 'A'; -- 1B-1 downgraded to 'C/DR5' from 'BB'; -- 1B-2 downgraded to 'C/DR6' from 'B'; Deal Summary -- 60+ day Delinquency: 25.06% -- Realized Losses to date (% of Original Balance): 3.16% C-BASS 2001-CB3 -- M-1 affirmed at 'AAA'; -- M-2 affirmed at 'AA'; -- B-1 affirmed at 'BBB'; -- B-2 affirmed at 'B+'; Deal Summary -- 60+ day Delinquency: 18.22% -- Realized Losses to date (% of Original Balance): 7.80% C-BASS 2001-CB4 GROUP 1 -- 1A-1 affirmed at 'AAA'; -- 1M-1 downgraded to 'A' from 'AA'; -- 1M-2 downgraded to 'BBB-' from 'A-'; -- 1B-1 downgraded to 'B+' from 'BB'; Deal Summary -- 60+ day Delinquency: 18.72% -- Realized Losses to date (% of Original Balance): 4.43% C-BASS 2001-CB4 GROUP 2 -- IIM-2 affirmed at 'AA-'; -- IIB-1 affirmed at 'A'; Deal Summary -- 60+ day Delinquency: 16.68% -- Realized Losses to date (% of Original Balance): 17.36% C-BASS 2002-CB1 -- M-2 affirmed at 'AA'; -- B-1 affirmed at 'A'; -- B-2 downgraded to 'CC/DR3' from 'B-/DR1'; Deal Summary -- 60+ day Delinquency: 25.44% -- Realized Losses to date (% of Original Balance): 6.70% C-BASS 2002-CB2 -- A-1 affirmed at 'AAA'; -- A-2 affirmed at 'AAA'; -- M-1 downgraded to 'A+' from 'AA'; -- M-2 downgraded to 'BBB' from 'BBB+'; -- B-1 revised to 'C/DR4' from C/DR3'; -- B-2 revised to 'C/DR6' from C/DR5'; Deal Summary -- 60+ day Delinquency: 15.29% -- Realized Losses to date (% of Original Balance): 3.71% C-BASS 2002-CB3 -- M-2 affirmed at 'AA+'; -- B-1 affirmed at 'A'; -- B-2 affirmed at 'BBB'; -- B-3 downgraded to 'CC/DR3' from 'B'; Deal Summary -- 60+ day Delinquency: 21.52% -- Realized Losses to date (% of Original Balance): 6.46% C-BASS 2002-CB4 -- AF-4 affirmed at 'AAA'; -- AV-1 affirmed at 'AAA'; -- M-1 affirmed at 'AA+'; -- M-2 affirmed at 'AA-'; -- B-1 affirmed at 'A-'; -- B-2 affirmed at 'BBB'; -- B-3 affirmed at 'BB'; Deal Summary -- 60+ day Delinquency: 8.44% -- Realized Losses to date (% of Original Balance): 2.54% C-BASS 2002-CB5 -- AF-3 affirmed at 'AAA'; -- AV-2 affirmed at 'AAA'; -- M-1 affirmed at 'AA'; -- M-2 affirmed at 'A'; -- B-1 affirmed at 'BB'; -- B-2 downgraded to 'B' from 'BB-'; -- B-3 downgraded to 'C/DR4' from 'B'; Deal Summary -- 60+ day Delinquency: 16.11% -- Realized Losses to date (% of Original Balance): 3.62% C-BASS 2002-CB6 -- M-1 affirmed at 'AA+'; -- M-2F downgraded to 'A-' from 'A+'; -- M-2V downgraded to 'A-' from 'A+'; -- B-1 downgraded to 'BB' from 'BBB'; -- B-2 downgraded to 'C/DR5' from 'B'; -- B-3 revised to 'C/DR6' from 'C/DR5'; Deal Summary -- 60+ day Delinquency: 14.72% -- Realized Losses to date (% of Original Balance): 3.55% CALIFORNIA CONDOMINIUMS: Involuntary Chapter 11 Case Summary ------------------------------------------------------------ Alleged Debtor: California Condominiums, LLC 11041 E. Betony Drive Scottsdale, Arizona 85255 Case Number: 08-06652 Involuntary Petition Date: June 5, 2008 Court: District of Arizona (Phoenix) Petitioner's Counsel: Alicia Mykyta, Esq. (alicia.mykyta@azbar.org) Paul S. Harter, PC 1599 E. Orangewood Avenue, Suite #125 Phoenix, Arizona 85020-5159 Tel: (602) 256-0337 Fax: (602) 256-0432 Petitioners Nature of Claim Claim Amount ----------- --------------- ------------ GR8 Solutions LLC services $95,000 110 W. Missouri, Suite 1 Phoenix, Arizona 85013 CALPINE CORP: Names Zamier Rauf as Interim Chief Fin'l Officer -------------------------------------------------------------- Calpine Corporation names Zamir Rauf as interim Chief Financial Officer effective. He will succeed Lisa Donahue, who has served as Calpine's interim Chief Financial Officer since November 2006, and is a managing partner at AlixPartners. "We are fortunate to have a qualified individual as Mr. Rauf assume this position," said William J. Patterson, Chairman of Calpine's Board. "[Mr. Rauf's] industry knowledge, finance and business background, and strategic planning experience will be invaluable as we execute our business plan." Mr. Rauf was most recently Senior Vice President, Finance and Treasurer. In that position, he oversaw Calpine's corporate finance, project finance, treasury and debt compliance functions and was responsible for the corporate banking, investment banking and rating agency relationships. Mr. Rauf played an integral role in Calpine's restructuring efforts, working closely with the company's legal and restructuring advisors as well as the creditors' committees in an effort to help ensure the successful reorganization of the company. Mr. Rauf joined Calpine in 2000 in the Finance group. Prior to joining Calpine, Mr. Rauf held various accounting and finance roles with Enron North America and Dynegy Inc. He earned his bachelor's degree in business and commerce and master's in business administration-finance from the University of Houston. Ms. Donahue will return to AlixPartners where she will continue in her current position as Managing Director and co-head of the firm's Turnaround and Restructuring practice. Patterson added, "On behalf of the Board of Directors, I want to thank Lisa for her hard work and significant contributions to Calpine. Our successful emergence from Chapter 11 was in no small part due to her outstanding expertise and leadership capabilities. We wish her all the best in her future endeavors." About Calpine Corporation Based in San Jose, California, Calpine Corporation (OTC Pink Sheets: CPNLQ) -- http://www.calpine.com/-- supplies customers and communities with electricity from clean, efficient, natural gas-fired and geothermal power plants. Calpine owns, leases and operates integrated systems of plants in 21 U.S. states and in three Canadian provinces. Its customized products and services include wholesale and retail electricity, gas turbine components and services, energy management and a wide range of power plant engineering, construction and maintenance and operational services. The company and its affiliates filed for chapter 11 protection on Dec. 20, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-60200). Richard M. Cieri, Esq., Matthew A. Cantor, Esq., Edward Sassower, Esq., and Robert G. Burns, Esq., Kirkland & Ellis LLP represent the Debtors in their restructuring efforts. Michael S. Stamer, Esq., at Akin Gump Strauss Hauer & Feld LLP, represents the Official Committee of Unsecured Creditors. As of Aug. 31, 2007, the Debtors disclosed total assets of $18,467,000,000, total liabilities not subject to compromise of $11,207,000,000, total liabilities subject to compromise of $15,354,000,000 and stockholders' deficit of $8,102,000,000. On Feb. 3, 2006, two more affiliates, Geysers Power Company, LLC, and Silverado Geothermal Resources, Inc., filed voluntary chapter 11 petitions (Bankr. S.D.N.Y. Case Nos. 06-10197 and 06-10198). On Sept. 20, 2007, Santa Rosa Energy Center, LLC, another affiliate, also filed a voluntary chapter 11 petition (Bankr. S.D.N.Y. Case No. 07-12967). On June 20, 2007, the Debtors filed their Chapter 11 Plan and Disclosure Statement. On Aug. 27, 2007, the Debtors filed their Amended Plan and Disclosure Statement. Calpine filed a Second Amended Plan on Sept. 19, 2007 and on Sept. 24, 2007, filed a Third Amended Plan. On Sept. 25, 2007, the Court approved the adequacy of the Debtors' Disclosure Statement and entered a written order on September 26. On Dec. 19, 2007, the Court confirmed the Debtors' Plan. The Amended Plan was deemed effective as of January 31, 2008. CHENIERE ENERGY: Jonathan Gross Resigns as Senior Vice President ---------------------------------------------------------------- Jonathan S. Gross resigned as Senior Vice President - Exploration of Cheniere Energy, Inc., but will continue as an employee until July 31, 2008. On May 9, 2008, the Committee approved a payment to Mr. Gross consisting of: (i) a cash payment equal to one month's base salary in the amount of $22,735 and (ii) the accelerated vesting of Mr. Gross' outstanding equity awards in company securities. Mr. Gross' equity awards to be accelerated consist of 17,844 shares of restricted stock and 200,000 non-qualified stock options which have an exercise price of $36.25. Payment of the Severance Payment is conditioned upon Mr. Gross' execution of a release and separation agreement following his termination from the company. A full-text copy of the Release and Separation Agreement is available for free at http://ResearchArchives.com/t/s?2d7e Retention Payments Approved On May 9, 2008, the Compensation Committee of the Board of Directors of Cheniere Energy approved these retention payments for employees and consultants designated by the Committee. 2008 Short-Term Retention Plan The Committee adopted the Cheniere Energy, Inc. 2008 Short-Term Retention Plan in order to retain key employees and consultants for the next six months. Pursuant to the Short-Term Plan, the Committee approved awards generally equal to one-half of an employee's base salary or a consultant's annual fee, as applicable, for employees and consultants designated by the Committee. The award shall be paid one-half in cash and one-half in a fixed grant of restricted stock (determined based on a stock price of $10.00 per share). The cash and restricted stock shall vest and become payable on Dec. 1, 2008. The maximum aggregate cash amount payable by the Company pursuant to the Short-Term Plan is $3,144,806 and the aggregate number of shares of restricted stock to be issued is 307,836. 2008 Long-Term Retention Plan The Committee adopted the Cheniere Energy, Inc. 2008 Long-Term Retention Plan in order to retain key employees and consultants for an extended period of time. The plan provides for a grant of restricted stock to employees and consultants designated by the Committee which vests in equal amounts on Dec. 31, 2008, Dec. 31, 2009 and Dec. 31, 2010. The aggregate number of shares of restricted stock to be issued pursuant to the Long-Term Plan is 1,525,038. 2008 Change of Control Cash Payment Plan The Committee adopted the Cheniere Energy, Inc. 2008 Change of Control Cash Payment Plan in order to retain key employees and consultants. The plan provides that, upon a Change of Control, as defined in the Cheniere Energy, Inc. Amended and Restated 2003 Stock Incentive Plan, the company shall pay to employees and consultants designated by the Committee an amount equal to one times each such employee or consultant's base salary or annual fee, as applicable, at or immediately prior to the time the Change of Control is consummated. The COC Award shall be payable to the employee or consultant within 30 days of the effective date of the Change of Control. About Cheniere Energy Based in Houston, Texas, Cheniere Energy Inc. (AMEX: LNG) -- http://www.cheniere.com/-- is developing a network of three LNG receiving terminals and related natural gas pipelines along the Gulf Coast of the United States. Cheniere is pursuing related business opportunities both upstream and downstream of the terminals. Cheniere is also the founder and holds a 30.0% limited partner interest in a fourth LNG receiving terminal. Cheniere Energy Inc.'s consolidated balance sheet at Dec. 31, 2007, showed $2.96 billion in total assets and $3.26 billion in total liabilities, resulting in a $302.1 million total stockholders' deficit. * * * As reported in the Troubled Company Reporter on May 13, 2008, Standard & Poor's Ratings Services lowered its corporate credit rating on liquefied natural gas project developer Cheniere Energy Inc. to 'CCC+' from 'B' and its senior secured rating on subsidiary Sabine Pass LNG L.P. to 'B+' from 'BB'. S&P also removed the ratings from CreditWatch with negative implications, where S&P placed them on April 17, 2008. At the same time, S&P revised its recovery rating on Sabine Pass to '4', indicating average (30% to 50%) recovery of principal in the event of a payment default. The outlook is negative. CIFG GUARANTY: S&P Cuts Financial Strength Rating to A- from A+ --------------------------------------------------------------- Standard & Poor's Ratings Services lowered its financial strength ratings on CIFG Guaranty, CIFG Europe, and CIFG Assurance North America Inc. to 'A-' from 'A+' and placed the ratings on CreditWatch with negative implications. The downgrade reflects S&P's view that CIFG has lagged the industry in par volume in recent years and has generally failed to develop a strong franchise. Because of this, and given its opinion that total insured business volume will be off for the industry in the near term, S&P believe that the company is highly prone to damage to its franchise. To improve CIFG's situation, management is evaluating a long-term plan to restructure the company with a focus on the U.S. public finance market and selective participation in global structured finance and the global infrastructure markets. In S&P's opinion, the future strategic direction of the company and the stability of the rating will largely depend on the results of this restructuring effort. The placement on CreditWatch reflects S&P's view that there is execution risk in the company's restructuring plan. Should CIFG prove unsuccessful in its restructuring, S&P believe the company would effectively be in runoff, in which case the rating could go lower. The 'A-' financial strength and financial enhancement ratings reflect a consolidated margin of safety that is well above Standard & Poor's Ratings Services' required 'A-' level, strong parental support, and, in S&P's view, a sound restructuring plan to move the company forward. The combined operations of CIFG produced a margin of safety that was in the 1.3x-1.4x range, based on Standard & Poor's capital adequacy test. To support CIFG's claims-paying resources, Banque Federale des Banques Populaires and Caisse Nationale des Caisses d'Epargne contributed a total of $1.3 billion of capital and provided a $204 million capital facility available to the company. CITIZENS REPUBLIC: Fitch Expects to Rate Stock Issuance 'BB+ ------------------------------------------------------------ Fitch Ratings expects to rate Citizens Republic Bancorp, Inc.'s upcoming perpetual preferred stock issuance 'BB+'. The Rating Outlook is Negative. CRBC plans to issue $200 million in convertible non-cumulative perpetual preferred stock and common stock. The preferred stock converts to common stock immediately upon common stock shareholder approval of additional authorized common shares required for conversion. Fitch expects to assign 100% equity credit to this issuance due to the preferred stock's level of subordination, non- cumulative structure and near-term conversion to common equity. Proceeds will be used to build liquidity at the parent company. The issuance of additional common and preferred stock at this time will materially strengthen CRBC's capital base. However, CRBC's long-term Rating Outlook remains Negative, as Fitch believes asset quality problems and tough economic conditions in CRBC's markets will continue in the near to intermediate term. Fitch will continue to assess the company's asset quality deterioration and loss content and the resulting impact on earnings generation in resolving the Rating Outlook over the next few quarters. Fitch expects to assign this rating: Citizens Republic Bancorp, Inc. -- Preferred stock 'BB+'. COHR HOLDINGS: Loss of Largest Customer Cues Moody's to Junk CFR ---------------------------------------------------------------- Moody's Investors Service downgraded Cohr Holdings, Inc.'s Corporate Family Rating to Caa1 from B2. Moody's also downgraded the ratings on the senior secured credit facility to B3 from B1. The outlook remains negative. The downgrade of the ratings follows the company's loss of its largest customer, which Moody's estimates constituted more than 20% of Cohr's total revenue. The company believes the loss of the customer contract was not related to dissatisfaction with Cohr's services. Nonetheless, given Cohr's small size, highly leveraged position and limited liquidity Moody's believes the loss of the contract makes the company's ability to service its debt increasingly uncertain. On February 11, 2008 Moody's revised Cohr's rating outlook to negative from stable citing the materially weaker than expected operating performance in the year since the ratings were first assigned. Moody's also commented that the ratings could be downgraded if the company's operating performance were to remain weak or the company were to lose a material customer. The rating outlook remains negative, reflecting the risk of a liquidity shortfall in the next 12 to 24 months. The ratings could be stabilized if Cohr is able to offset the revenue and cash flow from the lost contract through expense management and growth from new contract wins. These ratings were downgraded: -- Corporate Family Rating; to Caa1 from B2 -- Probability of Default Rating; to Caa1 from B2 -- $20 million Senior Secured Revolver; to B3 (LGD3/39%) from B1 (LGD3/38%) -- $140 million Senior Secured Term Loan; to B3 (to LGD3/39%) from B1 (LGD3/38%) The ratings outlook remains negative. Headquartered in Chatsworth, California, Cohr Holdings, Inc. is a leading independent service organization in the diagnostic imaging and biomedical equipment maintenance and repair services industry. For the twelve months ended March 31, 2008 Cohr generated approximately $161 million in revenue. COSINE COMMS: Earns $52,000 in 2008 First Quarter Ended March 31 ---------------------------------------------------------------- CoSine Communications Inc. reported net income of $52,000 for the first quarter ended March 31, 2008, compared with net income of $94,000 for the same period ended March 31, 2007. Effective Dec. 31, 2006, the company ceased all customer service operations. Accordingly, there were no revenues recognized for the three months ended March 31, 2008, and 2007. General and administrative expenses were $178,000 and $197,000 for the three months ended March 31, 2008, and 2007, respectively. For the three months ended March 31, 2008, and 2007, interest income and other income was $230,000 and $291,000, respectively. The decrease from March 31, 2007, to March 31, 2008, is due to lower interest rates during the first quarter of 2008 as compared to 2007. At March 31, 2008, the company's consolidated balance sheet showed in $23,226,000 in total assets, $236,000 in total liabilities, and $22,990,000 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?2d64 Going Concern Doubt As reported in the Troubled Company Reporter on April 3, 2008, Burr, Pilger & Mayer LLP ,in Palo Alto, Calif., expressed substantial doubt about CoSine Communications Inc.'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. At March 31, 2008, the company has an accumulated deficit of $516,060,000. The company's current redeployment of assets strategy and the termination of its employees, discontinuance of production activities and cessation of its customer support offerings and service capabilities raise substantial doubt about its ability to continue as a going concern. About CoSine Communications Based in Redwood City, California, CoSine Communications Inc. (OTC: COSN.PK) -- http://www.cosinecom.com/-- was founded in 1998 as a global telecommunications equipment supplier to empower service providers to deliver a compelling portfolio of managed, network-based IP and broadband services to consumers and business customers. CoSine ceased its customer service operations effective Dec. 31, 2006. CoSine's strategic plan is to redeploy its existing resources to identify and acquire new business operations. CoSine's redeployment strategy will involve the acquisition of one or more operating businesses with existing or prospective taxable earnings. As of May 16, 2008, no candidates have been identified. COUDERT BROS: Disclosure Statement Needs More Changes, Court Says ----------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York indicated that Coudert Brothers LLP's disclosures statement describing its amended chapter 11 plan of liquidation needs further revision before it can be approved, Bankruptcy Law 360 reports. The Hon. Robert D. Drain, according to the report, said he is already inclined to give a thumbs up to the Debtor's disclosure statement at a hearing expected to take place this week. Judge Drain, added that the Debtor's disclosure statement already contains adequate information relating to changes that he had suggested, Bankruptcy Law says. Filing of Plan and Disclosure Statement As reported by the Troubled Company Reporter on May 14, 2008, the Debtor submitted to the Court its amended plan of liquidation and an amended disclosure statement describing that plan. Under the amended plan, secured creditors with claims of about $1 million will get 100% recovery. Holders of $1.5 million priority non-tax claims will get 100% recovery. Holders of malpractice claims will get 100% recovery. Holders of unsecured claims will get recovery of up to 39%, if total allowed claims equals $26 million. Holders of $102,000 non-profit claims, $3.3 million partner profit claims, and interest claims, won't be repaid. About Coudert Brothers Coudert Brothers LLP was an international law firm specializing in complex cross border transactions and dispute resolution. The firm had operations in Australia and China. The Debtor filed for Chapter 11 protection on Sept. 22, 2006 (Bankr. S.D.N.Y. Case No. 06-12226). John E. Jureller, Jr., Esq., and Tracy L. Klestadt, Esq., at Klestadt & Winters, LLP, represent the Debtor in its restructuring efforts. Kurtzman Carson Consultants LLC is the Debtor's claims and notice agent. Brian F. Moore, Esq., and David J. Adler, Esq., at McCarter & English, LLP, represent the Official Committee Of Unsecured Creditors. In its schedules of assets and debts, Coudert listed total assets of $29,968,033 and total debts of $18,261,380. The Debtor's exclusive period to file a plan expired on May 20, 2007. The Debtor proposed a plan confirmation hearing to be held on Aug. 15, 2008, at 10:00 a.m. COUNTRYWIDE FINANCIAL: Gets "Blackout" Notice from 401(k) Trustee ----------------------------------------------------------------- Countrywide Financial Corporation received notice from the trustee/administrator of the Company 401(k) Savings and Investment Plan that a "blackout period" for the Plan would be imposed on transactions by Plan participants involving the Countrywide Stock Fund. On June 2, 2008, Countrywide sent a notice to its directors and executive officers informing them that: (1) the Plan blackout period is expected to begin as of 4:00 p.m., Eastern Time, on June 27, 2008 and end the morning of July 2, 2008, and (2) the directors and executive officers generally will be unable to trade in Countrywide common stock and related equity securities during the Plan blackout period. The Plan blackout period is being implemented to provide for the conversion of shares of Countrywide common stock into shares of Bank of America common stock held by the Countrywide Stock Fund, which will become the Bank of America Corporation Common Stock Fund, as a result of the closing of the acquisition of Countrywide by Bank of America Corporation. Access to the Countrywide Stock Fund held in accounts under the Plan will be suspended for the blackout period so that Plan participants will be unable to engage in certain transactions involving the Countrywide Stock Fund held in their Plan accounts, including exchange, distribution, contribution and loan transactions. A copy of the blackout notice to directors and executive officers is available for free at http://ResearchArchives.com/t/s?2d74 Based in Calabasas, California, Countrywide Financial Corporation (NYSE: CFC) -- http://www.countrywide.com/-- is a diversified financial services provider and a member of the S&P 500, Forbes 2000 and Fortune 500. Through its family of companies, Countrywide originates, purchases, securitizes, sells, and services residential and commercial loans; provides loan closing services such as credit reports, appraisals and flood determinations; offers banking services which include depository and home loan products; conducts fixed income securities underwriting and trading activities; provides property, life and casualty insurance; and manages a captive mortgage reinsurance company. * * * As reported in the Troubled Company Reporter on Jan. 15, 2008, Moody's placed the ratings of Countrywide Financial Corporation and its subsidiaries under review for upgrade. CFC and Countrywide Home Loans senior debt is rated Baa3 and short-term debt is rated Prime-3. Countrywide Bank FSB's bank financial strength rating is C-, deposits are rated Baa1 and short-term debt Prime-2. All long and short-term ratings are placed under review for possible upgrade. The company is continuing to face a barrage of lawsuits coming from disgruntled homeowners that filed for bankruptcy protection. Countrywide has been accused by these homeowners and various federal agencies of dubious and questionable lending practices, and for abusing the bankruptcy system. CRT LAND: Case Summary & Three Largest Unsecured Creditors ---------------------------------------------------------- Debtor: CRT Land Company Inc. 6200 Lake Ming Rd #C-2 Bakersfield, CA 93306 Bankruptcy Case No.: 08-13245 Chapter 11 Petition Date: June 4, 2008 Court: Eastern District of California (Fresno) Debtors' Counsel: D. Max Gardner, Esq. 1800 30th St., 4th Fl Bakersfield, CA 93301-5298 Tel: (661) 327-9661 Estimated assets: $1,000,001 to $10,000,000 Estimated debts: $1,000,001 to $10,000,000 Debtor's three largest unsecured creditors: Entity Nature of Claim Amount ------ --------------- ------ Pinnacle Civil Engineering Inc. Goods & services $75,000 2161 Saturn Court Bakersfield, CA 93308 Wall, Wall & Peake Goods & services $3,065 1601 'F' Street Bakersfield, CA 93301 State Water Resources Control Goods & services $1,500 P.O. Box 1888 Sacramento, CA 95182-1888 CUMULUS MEDIA: High Debt Leverage Cues Moody's to Cut Ratings ------------------------------------------------------------- Moody's Investors Service downgraded Cumulus Media Inc.'s Corporate Family Rating to B1 from Ba3, its Probability of Default Rating to B2 from B1 and the rating on its $850 million credit facility ($100 million revolver due 2012 and $750 million term loan due 2014) to B1 from Ba3. This concludes Moody's review that was initiated on July 24, 2007 following the company's announcement of a merger agreement with an investor group led by Lew Dickey, the company's Chairman, President and CEO, and an affiliate of Merrill Lynch Global Private Equity. The outlook is negative. The downgrades were prompted by Cumulus' high debt to EBITDA leverage of 7.6x at 3/31/2008 (incorporating Moody's standard adjustments) and Moody's expectation that the company's leverage will continue to remain high over the rating horizon given the potential for share repurchases following the termination of the company's merger agreement with the investor group in May 2008. The negative outlook reflects the potential for deterioration in the company's EBITDA in light of negative industry trends and the modest cushion under the company's credit facility leverage covenant. Moody's has taken these ratings actions: Cumulus Media Inc. * Corporate family rating -- downgraded to B1 from Ba3 * Probability-of-default rating -- downgraded to B2 from B1 * $100 Million Secured Revolver due 2012-- downgraded to B1 from Ba3 (LGD 3, 34%) * $750 Million Secured Term Loan due 2014 -- downgraded to B1 from Ba3 (LGD 3, 34%) * The outlook is negative. Cumulus' rating reflects higher than expected debt to EBITDA leverage (7.6x based on trailing twelve months ended March 31, 2008) and Moody's expectation that given the termination of its merger agreement, the company will likely resume share repurchases over the rating horizon. Moody's also expects that Cumulus will maintain a modest margin of covenant compliance under its financial maintenance covenants over the next twelve months. In addition, the rating reflects the inherent cyclicality of the advertising business, cross media-competition faced by radio for audience and advertising revenue and Moody's belief that radio is a mature industry with limited growth prospects. The ratings continue to benefit from the geographic and cash flow diversity in Cumulus' station portfolio, its clustering strategy which yields format diversity and dominant market positions and heavier proportion of local advertising revenue. Cumulus Media Inc., headquartered in Atlanta, Georgia is a radio broadcaster that upon completion of all pending acquisitions, will own or operate (directly and through its investment in Cumulus Media Partners, LLC) 339 radio stations in 65 markets. CUSTOM ENGINEERED: Case Summary & 19 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Custom Engineered Products, LLC 1220 Flynn Street Chattanooga, TN 37404 Bankruptcy Case No.: 08-12536 Chapter 11 Petition Date: May 7, 2008 Court: Eastern District of Tennessee (Chattanooga) Judge: John C. Cook Debtors' Counsel: Kyle R. Weems, Esq. Suite 203 5312 Ringgold Road Chattanooga, TN 37412 Tel: (423)624-1000 E-mail: weemslaw@earthlink.net Total assets: Unknown Total debts: $1,659,594 A copy of the Debtor's petition and schedules of liabilities is available at no charge at: http://bankrupt.com/misc/tneb08-12536-pet.pdf A list of the Debtor's 19 largest unsecured creditors is available at no charge at http://bankrupt.com/misc/tneb08-12536-cred.pdf DECODE GENETICS: Stockholders Approve Equity Incentive Plan ----------------------------------------------------------- deCODE genetics, Inc. stockholders approved at their 2008 annual meeting an amendment to the company's 2006 Equity Incentive Plan to increase the maximum number of shares of common stock that may be issued under the Plan from 4,000,000 to 10,000,000. Under the terms of the 2006 Plan, the company's non-employee directors, employees and consultants are eligible to receive stock options, restricted stock and stock appreciation rights (including stock appreciation rights granted in tandem with stock options). The 2006 Plan is administered by the Compensation Committee of the Board. A copy of the 2006 Plan, as amended, is available for free at http://ResearchArchives.com/t/s?2d7c deCODE genetics Inc. (Nasdaq: DCGN) -- http://www.decode.com/-- operates as a biopharmaceutical company that applies discoveries in human genetics to develop drugs and diagnostics for common diseases. The company serves pharmaceutical companies, biotechnology firms, pharmacogenomics companies, government institutions, universities, and other research institutions primarily in the United States, Europe, and internationally. The company was founded in 1996 and is headquartered in Reykjavik, Iceland. deCODE genetics Inc.'s consolidated balance sheet at Dec. 31, 2007, showed $156.2 million in total assets and $301.9 million in total liabilities, resulting in a $145.7 million total stockholders' deficit. DEN-MARK CONSTRUCTION: Cash Collateral Hearing to Continue June 26 ------------------------------------------------------------------ The U.S. Bankruptcy Court for the Eastern District of North Carolina will resume a hearing on the motion of Den-Mark Construction Inc. to use Regions Bank's cash collateral on June 26, 2008, at 10:00 a.m. Second Interim Order to Use of Cash Collateral The Troubled Company Reporter said on June 4, 2008, that the Court gave Den-Mark Construction a second interim approval to use cash collateral securing their obligation to Regions Bank. Den-Mark Construction executed a promissory note, dated May 16, 2005, with Regions Bank to finance the construction on lots in the Wedgefield subdivision in Johnston County, North Carolina. The note is secured by first priority deeds of trust on the Wedgefield property. The Debtor presently has contracts to sell on home in Wedgefield on June 2008, which is the subject of a pending motion for authority to sell property free and clear of liens. The proceeds generated from sales of the lot constitute cash collateral of Regions Bank. About Den-Mark Construction Youngsville, North Carolina-based Den-Mark Construction Inc. constructs single-family houses. It filed its chapter 11 petition on April 24, 2008 (Bankr. E.D.N.C. Case No. 08-02764) together with three debtor-affiliates, Den-Mark Homes SC, Inc. (08-02766); Marcus Edwards Development, LLC (08-02768); and M&D Development, LLC (08-02769). Judge Randy D. Doub presides over the case. Trawick H. Stubbs, Jr., Esq., at Stubbs & Perdue, P.A. represents the Debtors in their restructuring efforts. The Debtors' schedules showed total assets of $44,810,901 and total liabilities of $34,537,937. DEN-MARK CONSTRUCTION: Stock DIP Fund Hearing to Continue June 26 ----------------------------------------------------------------- The U.S. Bankruptcy Court for the Eastern District of North Carolina will resume a hearing on the joint request of Den-Mark Construction Inc. and Marcus Edwards Development LLC to access postpetition financing from Stock Building Supply Inc. on June 26, 2008, at 10:00 a.m. The Debtors told the Court that they intend to enter into a postpetition financing agreement with Stock. The Debtors agreed to provide Stock a substitute collateral in the form of a deed of trust on 11 homes-for-rent owned by Den-Mark Properties Inc., in addition to its existing collateral. The Debtors pledged to secure the Stock loan with second priority future advances deed of trust on the 11 homes. The Debtors also pledged to secure the Stock loan with a junior lien on a property owned by Marcus Edwards known as Brighton Ridge. According to Den-Mark Construction and Marcus Edwards, they own several real estate developments in North Carolina. They also build houses. The Debtors said that their primary supplier is Stock. Currently, they owe Stock about $911,646, secured by statutory mechanic liens. The material terms of the postpetition financing agreement are: a. maximum principal amount of $1,100,000, of which $911,646 as already been advanced; b. interest rate will be calculated on all outstanding amounts at a rate to be agreed upon. Additional amounts advanced will accrue interest at this same rate, provided that the advance will be given interest free for 30 day; c. term of the loan will be ongoing until all amounts owed to Stock are paid in full; d. payment to Stock will be paid from the sale of the properties identified in the deed of trust, after payment of senior liens and closing costs. Parties Object to Stock DIP Financing A. Four Oaks Bank Creditor Four Oaks Bank and Trust Company filed an objection with the Court on the Debtors' motion to enter into a postpetiton financing pact with Stock. The bank did not disclose its reasons for opposing the request. Gordon C. Woodruff, Esq., in Smithfield, North Carolina represents Four Oaks Bank. B. Bankruptcy Administrator Marjorie K. Lynch, bankruptcy administrator, informed the Court that she wants the Debtors' request to access Stock's DIP financing denied. According to Ms. Lynch, it is unclear what type of entity Den-Mark Properties is and what relation it has with the Debtors. It is also unclear, she added, what rental properties are owned by Den- Mark Properties, where they are located, and what their values are. It appears, the administrator continued, that with the only $188,353 of the $1,100,000 will be available to the Debtors as postpetition financing while the remaining $911,646 is prepetition debt now being secured by additional collateral. This represents less than six months of the salaries requested by the shareholder- officers. The administrator pointed that the Debtors have not provided sufficient disclosure to justify granting an additional $1,100,000 lien on a property that might otherwise have money available for unsecured creditors upon a sale. The administrator said she is concerned that requiring the Debtors to repay additional sums advanced by Stock within 30 days may not be feasible. She said that the interest rate was not determined nor clearly disclosed. C. SunTrust Bank Creditor SunTrust Bank pointed to the Court that the Debtors sought to obtain $188,353 in additional postpetition financing from Stock in exchange for $1,100,000 additional security not only for the $188,353 to be advanced but also for the $911,646 that Stock has already advanced to the Debtors. SunTrust asserted that the Den-Mark Properties is an entity related to the Debtors but is not in bankruptcy. The bank said that Stock, which holds pre-existing mechanic liens of $911,646, is seeking collateral to secure its advances in addition to what has been in the Debtor's motion. SunTrust said it possesses valid and perfected first deeds of trust on the homes owned by Den-Mark Properties and on the Brighton Ridge property. The bank said that its deeds of trust prohibit secondary financing without its consent. The bank said that the Debtors' seek to modify SunTrust's contractual rights with respect to the properties that are not in bankruptcy and impair its interests in those properties. To the extent that sales of the Brighton Ridge properties generate proceeds net of loan payoff amounts, the proceeds constitute SunTrust's cash collateral, the bank said. SunTrust said that the Debtors offered no adequate protection to the bank for use of its cash collateral. Charles N. Anderson, Jr., Esq., and George F. Sanderson III, Esq., at Ellis & Winters LLP, represents SunTrust Bank. Stock Responds Stock acknowledged that it is the main materials supplier to Den- Mark Construction. Stock said it has filed statutory mechanic liens against 29 tracts of real property owned by the Debtors in various subdivisions. Three of the properties are subject to title insurance claims since they were sold to third party owners without payment to Stock. Two of the properties were sold free and clear of Stock's liens. Stock said that the Debtors' motion to use its DIP financing purports to provide substitute collateral but fails to describe the property in sufficient detail. Hence, Stock said that it can not sufficiently evaluate the value of the proposed collateral. Stock said that it has not agreed to advance additional credit without additional security. Nan E. Hannah, Esq., at Vann & Sheridan LLP represents Stock Building Supply. About Den-Mark Construction Youngsville, North Carolina-based Den-Mark Construction Inc. constructs single-family houses. It filed its chapter 11 petition on April 24, 2008 (Bankr. E.D.N.C. Case No. 08-02764) together with three debtor-affiliates, Den-Mark Homes SC, Inc. (08-02766); Marcus Edwards Development, LLC (08-02768); and M&D Development, LLC (08-02769). Judge Randy D. Doub presides over the case. Trawick H. Stubbs, Jr., Esq., at Stubbs & Perdue, P.A. represents the Debtors in their restructuring efforts. The Debtors' schedules showed total assets of $44,810,901 and total liabilities of $34,537,937. EAGLE INVESTMENTS: Files Voluntary Chapter 11 Case Summary ---------------------------------------------------------- Debtor: Eagle Investments, L.L.C. 4141 N.W. 5th Street, Suite 100 Plantation, Florida 33317 Bankruptcy Case No.: 08-17472 Chapter 11 Petition Date: June 4, 2008 Court: Southern District of Florida (Fort Lauderdale) Judge: Raymond B. Ray Debtors' Counsel: David Marshall Brown, Esq. (dmbrownpa@bellsouth.net) David Marshall Brown P.A. 33 N.E. 2nd Street, Suite #208 Ft. Lauderdale, Florida 33301 Tel: (954) 765-3166 Fax: (954) 765-3382 Total Assets: $1,749,168 Total Debts: $1,393,055 The Debtor does not have any creditors who are not insiders. ESMARK INC: Says Reports on Failure to Refinance Debt Are False --------------------------------------------------------------- Esmark Incorporated provided clarification regarding its press statement issued in compliance with NASDAQ rules. The company stated that reports stating that the company had not refinanced its long-term debt are erroneous. On May 6, 2008, the company refinanced its senior secured term loan with a $110 million dollar facility with Essar Steel Holdings Limited, which does not mature until June 1, 2009. The company also extended its short term revolving credit agreements to no later than Sept. 30, 2008. Because the short term revolving credit facilities mature no later than Sept. 30, 2008, the company received a going-concern qualification in connection with its Annual Report on Form 10-K. The company reported in its Form 10-K that in the event it is unable to refinance or repay such short-term debt, it would consider alternative capital arrangements with third parties or obtaining proceeds from the disposition of assets. As reported on April 30, 2008, the company has agreed to the material terms of a proposed tender offer and merger with Essar Steel Holdings Limited for the purchase of all of the outstanding common stock of the company for $17 per share which the company anticipates would be consummated prior to Sept. 30, 2008, if the company enters into the proposed merger agreement with Essar Steel Holdings Limited. "Our company has improved its liquidity and our balance sheet is stronger than at any time since I was appointed chairman of Wheeling-Pittsburgh Corporation on Dec. 1, 2006," James Bouchard, Esmark CEO, stated. "We have a sincere appreciation for Essar and the financing they have provided to help strengthen our balance sheet in a time of troubled global credit markets." "It is one of many reasons we chose to partner with them," added Mr. Bouchard. "We expect to file our Form 10-Q for the first quarter next week and we will announce guidance for the second quarter. Our businesses continue to benefit from the strong market prices which we are currently experiencing." About Esmark Inc. Based in Wheeling, West Virginia, Esmark Inc. (NASDAQ:ESMK) -- http://www.esmark.com-- formerly Wheeling-Pittsburgh Corporation, is a holding company that, together with its subsidiaries and joint ventures, produces steel and steel products using both integrated and electric arc furnace technology. The company's principal operating subsidiary is Wheeling-Pittsburgh Steel Corporation. The company produces flat rolled steel products for steel service centers, converters, processors, and the construction, container and agriculture industries. Its product offerings focus on higher value-added finished steel products, such as cold rolled products, fabricated products, and tin and zinc coated products. Higher value-added products comprised 60.8% of the company's shipments during the year ended Dec. 31, 2006. In addition, it produces hot rolled steel products, which represent the least processed of its finished goods. In March 2008, the company completed the sale of its minority equity interest in Wheeling-Nisshin Inc. to Nisshin Holding Inc. Going Concern Doubt On May 20, Deloitte & Touche LLP of Pittsburgh, Pennsylvania, wrote to the Board of Directors and stockholders of Esmark Incorporated that after auditing the company's financial statements for the year ended December 31, 2007, it has substantial doubt regarding the company's ability to continue as a going concern because the company has been unable to refinance its debt on a long-term basis. In its 2007 Annual Report, the company disclosed that its current revolving credit facilities are due and payable no later than September 30, 2008. On April 30, 2008, the company agreed to the material terms of a proposed tender offer and merger with Essar Steel Holdings Limited for the purchase of all of the outstanding common stock of the company for $17.00 per share. The company also entered into a binding commitment with Essar for a $110,000 term loan, the proceeds of which were used to repay the company's outstanding term loan in the amount of $79 million and to provide additional liquidity to the company. This proposed tender offer is subject to a 52-day "right to bid" period as set forth in the collective bargaining agreement with the USW which may or may not result in a competing bid or offer from another concern. If the proposed merger with Essar is terminated under certain circumstances, the company would be required to pay Essar a "breakage fee" of $20.5 million. On May 16, 2008, the USW demanded that Esmark repudiate the Essar agreements and asserted that those agreements with Essar are in direct violation of the company's collective bargaining agreement with the USW. In a non-binding proposal dated May 20, 2008, OAO Severstal offered to acquire all of the outstanding common stock of the company for $17.00 per share. Severstal also stated that they are prepared to enter into interim liquidity substitute financing arrangements upon entering into a mutually acceptable definitive merger agreement. Severstal represented that they have entered into an agreement that satisfies the successorship clause of the company's collective bargaining agreement and that the USW informed them that it will waive its right to bid provisions in the collective bargaining agreement with respect to the Severstal proposal. ESMARK INC: Severstal Waives Essar Steel Deal, Says Offer is Valid ------------------------------------------------------------------ OAO Severstal, which has rivaled the takeover bid of Essar Steel Holdings Ltd. for Esmark Incorporated, said its offer is not subject to the target company terminating its merger agreement with the Ruias-led Indian firm, The Economic Times reports. In a press statement, OAO Severstal stated that it has waived the Essar Steel agreement termination condition in connection with its tender offer to acquire all of the outstanding shares of common stock of Esmark Incorporated. It had been a condition to the tender offer that Esmark validly terminate the Memorandum of Agreement, dated April 30, 2008, between Esmark and Essar Steel Holdings Limited and, if entered into prior to the expiration of the tender offer, the Agreement and Plan of Merger between Esmark and Essar Steel contemplated by the Memorandum of Agreement. On May 30, 2008, Severstal commenced the all cash $17 per share tender offer to acquire Esmark shares. All other terms and conditions of the tender offer remain the same, as set forth in the Offer to Purchase filed with the United States Securities and Exchange Commission on May 30, 2008. Severstal's tender offer is scheduled to expire at 12:00 midnight, Eastern Daylight Time, on June 26, 2008, unless extended. After completion of the tender offer, subject to the terms and conditions set forth in the Offer to Purchase, as amended, Severstal intends to consummate a second-step merger where all remaining Esmark stockholders will receive the same cash price paid in the tender offer, subject to any available appraisal rights under Delaware law. The tender offer is not conditioned on financing. Merrill Lynch is the Dealer Manager and Citibank, N.A. is the Depositary for the tender offer. Questions and requests for documentation in connection with the tender offer may be directed to MacKenzie Partners Inc., the Information Agent for the tender offer, at (800) 322-2885 (toll-free) or (212) 929-5500 (collect). About OAO Severstal OAO Severstal (LSE: SVST; RTS: CHMF) is an international metals and mining company with a listing on the Russian Trading System and the London Stock Exchange. Incorporated in 1993, the company focuses on high value added and unique niche products and has a successful track record of acquiring and integrating high-quality assets in North America and Europe. Severstal owns mining assets in Russia, thus securing its supplies of raw materials. About Esmark Inc. Based in Wheeling, West Virginia, Esmark Inc. (NASDAQ:ESMK) -- http://www.esmark.com-- formerly Wheeling-Pittsburgh Corporation, is a holding company that, together with its subsidiaries and joint ventures, produces steel and steel products using both integrated and electric arc furnace technology. The company's principal operating subsidiary is Wheeling-Pittsburgh Steel Corporation. The company produces flat rolled steel products for steel service centers, converters, processors, and the construction, container and agriculture industries. Its product offerings focus on higher value-added finished steel products, such as cold rolled products, fabricated products, and tin and zinc coated products. Higher value-added products comprised 60.8% of the company's shipments during the year ended Dec. 31, 2006. In addition, it produces hot rolled steel products, which represent the least processed of its finished goods. In March 2008, the company completed the sale of its minority equity interest in Wheeling-Nisshin Inc. to Nisshin Holding Inc. Going Concern Doubt On May 20, Deloitte & Touche LLP of Pittsburgh, Pennsylvania, wrote to the Board of Directors and stockholders of Esmark Incorporated that after auditing the company's financial statements for the year ended December 31, 2007, it has substantial doubt regarding the company's ability to continue as a going concern because the company has been unable to refinance its debt on a long-term basis. In its 2007 Annual Report, the company disclosed that its current revolving credit facilities are due and payable no later than September 30, 2008. The company's ability to refinance these obligations will be dependent on a number of factors including the company's ability to borrow funds from the same or alternative lenders in a difficult lending environment, the company's ability to forecast and generate cash flow from future operations and the company's ability to structure alternative capital transactions with third parties and, if necessary, obtain proceeds from the disposition of assets. On April 30, 2008, the company agreed to the material terms of a proposed tender offer and merger with Essar Steel Holdings Limited for the purchase of all of the outstanding common stock of the company for $17.00 per share. The company also entered into a binding commitment with Essar for a $110,000 term loan, the proceeds of which were used to repay the Company's outstanding term loan in the amount of $79 million and to provide additional liquidity to the Company. This proposed tender offer is subject to a 52-day "right to bid" period as set forth in the collective bargaining agreement with the USW which may or may not result in a competing bid or offer from another concern. If the proposed merger with Essar is terminated under certain circumstances, the company would be required to pay Essar a "breakage fee" of $20.5 million. On May 16, 2008, the USW publicly announced a demand that Esmark repudiate the Essar agreements and asserted that those agreements with Essar are in direct violation of the company's collective bargaining agreement with the USW. In a non-binding proposal dated May 20, 2008, OAO Severstal (Severstal) offered to acquire all of the outstanding common stock of the Company for $17.00 per share. Severstal also stated that they are prepared to enter into interim liquidity substitute financing arrangements upon entering into a mutually acceptable definitive merger agreement. Severstal represented that they have entered into an agreement that satisfies the successorship clause of the company's collective bargaining agreement and that the USW informed them that it will waive its right to bid provisions in the collective bargaining agreement with respect to the Severstal proposal. ESPLANADE LLC: Secured Parties to Hold Auction on June 16 --------------------------------------------------------- Membership interests of secured parties, Robert A. Crowder and Esplanade SPE Member LLC, in Esplanade LLC aggregating 100% will be sold publicly on Monday, June 16, 2008, beginning 1:00 p.m. The sale will be held at the office of CapitalSource Finance LLC, 37 North Orange Avenue, Suite 500 in Orlando, Florida. Deposit amount for the assets is $50,000. Balance amount for the assets are due within four business days. Other terms of the sale will announced during the auction date. Additional information can be obtained from: Keith R. Walsh, Esq. Brown, Rudnick, Berlack, Isreals LLP Tel: (617) 856-8147 E-mail: kwalsh@brownrudnick.com Esplanade LLC is a Florida limited liability company organized to acquire, construct, own and operate a real property commonly known as Esplanade Condominiums. Esplanade Condominiums is located at 5337 Esplanade Park Circle in Orlando, Florida. ETRICITY: Three Texas Electricity Retailers Close After Default --------------------------------------------------------------- Three electricity retailers in Texas have stopped serving customers, Elizabeth Souder of The Dallas Morning News reports. Etricity, also known as HWY 3 MHP LLC, Pre-Buy Electric LLC and National Power Co. have closed after defaulting on payment to the Electric Reliability Council of Texas, which operates the power grid. ERCOT is now switching Etricity's 12,222 customers to other providers, known as providers of last resort, and is nearly finished switching the 23,593 customers of Pre-Buy and National Power. According to the report, electricity companies typically charge higher prices for default service, based on the average price of power in the wholesale spot market. And those prices have spiked in recent weeks as high temperatures boost demand for power, causing congestion on some transmission lines. Industry insiders say more defaults are on the way as wholesale power prices rise, according to the Dallas Morning News. Etricity is based in Denton. Based in Dr. Grapevine is owned by Criag Bolin. It was started in 2005. it has $130,000 in estimated annual sales, according to Manta (http://www.manta.com/). National Power, headquartered in Houston, was started in 2007. Its president is Denise Fields. It has 15 employees. EVERGREEN INT'L: Moody's Junks Corp. Family Rating; Outlook Neg. ---------------------------------------------------------------- Moody's Investors Service downgraded the Corporate Family Rating of Evergreen International Aviation, Inc., to Caa1 from B2, as well as the ratings of its outstanding corporate debt instruments. The outlook was changed to negative from stable. The rating downgrade reflects the weakening financial profile of Evergreen, which despite a long history of providing service to the U.S. government under an Air Mobility Command (AMC) contract, has reported negative free cash flow and deteriorating financial metrics in recent periods. "Moody's is particularly concerned about the proximity of the company to existing financial covenants, which may require Evergreen to obtain waivers and/or amendments in the near future", according to Moody's analyst George Godlin. Evergreen's liquidity is modest. The company maintains first- and second-lien bank credit facilities under which it is subject to a number of financial covenants. Moody's is concerned that the tightness of current covenant levels, which step up over the next several years, increases the risk of covenant violations in the near term that could require the company to seek waivers or amendments from its lending group. The negative outlook reflects Moody's expectation that operating performance will remain below historic levels in the near term and could impair the company's ability to remain in compliance with financial covenants. Evergreen's rating could be lowered further if cash liquidity declines below existing levels, if the company has operating losses, of it the company's proximity to breaching any financial covenant increases. Evergreen's rating outlook could be stabilized with sustained increases to revenues or operating profitability that increases cash from operations and eliminates the need to draw on cash reserves to satisfy maturing debt and capital spending requirements. Downgrades: Issuer: Evergreen International Aviation, Inc. * Probability of Default Rating, Downgraded to Caa1 from B2 * Corporate Family Rating, Downgraded to Caa1 from B2 * Senior Secured Bank Credit Facility, Downgraded to a range of Caa2 to B3 from a range of Caa1 to B1 Upgrades: Issuer: Evergreen International Aviation, Inc. * Senior Secured Bank Credit Facility, Upgraded to a range of 77 - LGD5 to 32 - LGD3 from a range of 79 - LGD5 to 33 - LGD3 Outlook Actions: Issuer: Evergreen International Aviation, Inc. * Outlook, Changed To Negative From Stable Withdrawals: Issuer: Evergreen International Aviation, Inc. * Senior Secured Regular Bond/Debenture, Withdrawn, previously rated Caa1 Evergreen International Aviation, Inc. is a privately held company headquartered in McMinnville, Oregon, whose chairman is founder and controlling shareholder Delford Smith. The company provides diversified air cargo transportation and aviation support services through its various operating segments including global air cargo shipping, ground handling and logistics, helicopter transportation services, small aircraft charters and aircraft maintenance and repair. FGIC: Projected CDO Losses Cue S&P's Negative Watch --------------------------------------------------- Standard & Poor's Ratings Services placed its 'BB' financial strength rating on Financial Guaranty Insurance Company on CreditWatch with negative implications. The rating previously had a negative outlook. Likewise, Standard & Poor's placed all other FGIC ratings, as well as those of parent company FGIC Corp., on CreditWatch with negative implications. The CreditWatch addresses S&P's concern regarding the magnitude of projected RMBS and related CDO losses when compared with claims- paying resources. Furthermore, restructuring scenarios under consideration raise the concern that the surviving corporate entity, FGIC, and the remaining policyholders may be disadvantaged compared with other classes of policyholders -- in particular, municipal policyholders. S&P expect to know more about the company's direction in the next several weeks and will take rating action as necessary as information becomes available. FORTUNE AT HIALEAH: Case Summary & 32 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Fortune At Hialeah, LLC 940 West 29th Street 960 West 29th Street 980 West 29th Street 990 West 29th Street Hialeah, FL 33012 Bankruptcy Case No.: 08-16820 Debtor-affiliates filing separate Chapter 11 petitions: Entity Case No. ------ -------- RG Investment Enterprises, LLC 08-16826 Lucky Investment, LLC 08-16833 Okeechobee Plaza, LLC 08-16841 Type of Business: Fortune At Hialeah is a single asset real estate. Chapter 11 Petition Date: May 23, 2008 Court: Southern District of Florida (Miami) Judge: A. Jay Cristol Debtors' Counsel: Gary M. Murphree, Esq. 142A Beacom Blvd Miami, FL 33135 Tel: (305) 631-4488 e-mail: jlh@murphree-law.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A. Fortune At Hialeah, LLC's 6 largest unsecured creditors: Entity Claim Amount ------ ------------ Miami-Dade Tax Collector $105,624 140 West Flagler Street Miami, FL 33130-1575 Department of Water & Sewers 32,016 City of Hialeah 3700 West 5th Avenue Hialeah, FL 33012 Royal Plumbing Corp. 12,954 Florida City Gas 9,517 Waste Management Services 3,399 Florida Power & Light Company 566 B. Lucky Investment, LLC's 5 largest unsecured creditors: Entity Claim Amount ------ ------------ WSD Developers Corp. Inc. $90,000 696 NE 125th Street Miami, FL 33161 Miami-Dade Tax Collector 63,699 A&G Roofing Corp. 18,000 All Service Waste 834 Florida Power & Light Company 450 C. Okeechobee Plaza, LLC's 5 largest unsecured creditors Entity Claim Amount ------ ------------ Miami-Dade Tax Collector $115,755 140 West Flagler Street Miami, FL 33130-1575 Department of Water & Sewers 12,067 All Service 3,003 CSE Paving of South Florida 1,500 Florida Power & Light Company 861 D. RG Investment Enterprises, LLC's 6 largest unsecured creditors: Entity Claim Amount ------ ------------ Miami-Dade Tax Collector $125,004 140 West Flagler Street Miami, FL 33130-1575 AFCO 18,000 FG Developers Corp. 8,028 Royal International Cargo, Inc. 3,000 Pack & Send Cargo, Inc. 3,000 Miami Dade Water Department 2,350 FREMONT GENERAL: Fitch Withdraws Default Rating ----------------------------------------------- Fitch Ratings has withdrawn its ratings on Fremont General Corporation as: -- Long-term Issuer Default Rating of 'D' is withdrawn; -- Individual Rating of 'F' is withdrawn; -- Senior unsecured debt of 'C/RR6'is withdrawn. Fremont General Financing I -- Preferred securities of 'C/RR6' is withdrawn. Fitch will no longer provide ratings or analytical coverage Fremont General Corporation. The rating action has no impact on the ratings of Fremont Investment & Loan, FMT's banking subsidiary. FREMONT HOME: Fitch Affirms 'BB-' Rating on Class M-4 Certificates ------------------------------------------------------------------ Fitch Ratings has rating actions on 7 Fremont Home Loan Trust mortgage pass-through certificates. Unless stated otherwise, any bonds that were previously placed on Rating Watch Negative are removed from Rating Watch Negative. Fremont Home Loan Trust 2002-1 -- M-1 affirmed at 'AA'; -- M-2 affirmed at 'A'; -- M-3 affirmed at 'BB'; -- M-4 affirmed at 'BB-'; Deal Summary -- Originators: Fremont -- 60+ day Delinquency: 26.62% -- Realized Losses to date (% of Original Balance): 2.14% Fremont Home Loan Trust 2002-2 -- M-1 downgraded from 'AA' to 'A+'; -- M-2A downgraded from 'A' to 'A-'; -- M-2B downgraded from 'A' to 'A-'; Deal Summary -- Originators: Fremont -- 60+ day Delinquency: 27.78% -- Realized Losses to date (% of Original Balance): 1.43% GAP INC: May 2008 Sales Decrease 8% at $1.09 Billion ---------------------------------------------------- The Gap Inc. reported net sales of $1.09 billion for the four-week period ended May 31, 2008, which is a decrease of 8% as compared with net sales of $1.19 billion for the same period ended June 2, 2007. The company's comparable store sales for May 2008 decreased 14% compared with a 3% decrease for May 2007. Comparable store sales by division for May 2008 were: * Gap North America: negative 7% versus negative 7% last year; * Banana Republic North America: negative 5% versus positive 3% last year; * Old Navy North America: negative 25% versus negative 3% last year; and * International: flat versus flat last year. "We were pleased that merchandise margins in May were significantly above last year," Sabrina Simmons, chief financial officer of Gap Inc., said. "However, Old Navy continues to be our biggest challenge. As we have stated, we are working to rebalance Old Navy's mix of fashion and seasonal basic items, and expect to see improvements in the assortments by late fall." Year-to-date net sales were $4.47 billion for the seventeen weeks ended May 31, 2008, a decrease of 6% compared with net sales of $4.74 billion for the seventeen weeks ended June 2, 2007. The company's year-to-date comparable store sales decreased 12% compared with a 4% decrease in the prior year. Quarterly Dividend The company's board of directors voted a quarterly dividend of $0.085 per share payable on July 29, 2008, to shareholders of record at the close of business on July 8, 2008. About Gap Headquartered in San Francisco, California, Gap Inc. (NYSE: GPS) -- http://www.gapinc.com/-- is an international specialty retailer offering clothing, accessories and personal care products for men, women, children and babies under the Gap, Banana Republic, Old Navy, Forth & Towne and Piperlime brand names. Gap Inc. operates more than 3,100 stores in the United States, the United Kingdom, Canada, France, Ireland and Japan. In addition, Gap Inc. is expanding its international presence with franchise agreements for Gap and Banana Republic in Southeast Asia and the Middle East. * * * Moody's Investor Service placed Gap Inc.'s corporate family, senior unsecured debt and probability of default ratings at 'Ba1' in February 2007. The ratings still hold to date with a stable outlook. GE CAPITAL: Fitch Downgrades Ratings on Nine Certificate Classes ---------------------------------------------------------------- Fitch Ratings has taken rating actions on GE Capital home equity mortgage pass-through certificates. Unless stated otherwise, any bonds that were previously placed on Rating Watch Negative are removed from Rating Watch Negative. Additionally, 4 classes have been put on Rating Watch Negative. GE CAPITAL 1997-HE1 -- A4 downgraded to 'A-' from 'AAA'; -- A5 downgraded to 'A-' from 'AAA'; -- M downgraded to 'CCC/DR2' from 'BB-'; -- B1 remains at 'C/DR5'; Deal Summary -- 60+ day Delinquency: 13.75% -- Realized Losses to date (% of Original Balance): 3.50% GE CAPITAL 1997-HE4 -- A6 rated 'AAA', placed on Rating Watch Negative; -- A7 rated 'AAA', placed on Rating Watch Negative; -- M downgraded to 'B' from 'A'; -- B1 remains at 'C/DR4'; Deal Summary -- 60+ day Delinquency: 9.54% -- Realized Losses to date (% of Original Balance): 3.24% GE CAPITAL 1998-HE1 -- A6 rated 'AAA', placed on Rating Watch Negative; -- A7 rated 'AAA', placed on Rating Watch Negative; Deal Summary -- 60+ day Delinquency: 19.44% -- Realized Losses to date (% of Original Balance): 2.95% GE CAPITAL 1998-HE2 -- A6 affirmed at 'AAA'; -- A7 affirmed at 'AAA'; Deal Summary -- 60+ day Delinquency: 16.96% -- Realized Losses to date (% of Original Balance): 2.41% GE CAPITAL 1999-HE1 -- A6 affirmed at 'AAA'; -- A7 affirmed at 'AAA'; -- M downgraded to 'BBB+' from 'AA'; -- B1 downgraded to 'BB' from 'BBB'; -- B2 revised to 'C/DR5' from C/DR3'; Deal Summary -- 60+ day Delinquency: 13.84% -- Realized Losses to date (% of Original Balance): 4.13% GE CAPITAL 1999-HE3 -- A5 affirmed at 'AAA'; -- A6 affirmed at 'AAA'; -- M downgraded to 'AA' from 'AAA'; -- B1 downgraded to 'A' from 'AA'; -- B2 downgraded to 'CCC/DR2' from 'BB'; -- B3 revised to 'C/DR5' from C/DR4'; Deal Summary -- 60+ day Delinquency: 14.29% -- Realized Losses to date (% of Original Balance): 3.50% GENERAL ENVIRONMENTAL: Has $342,826 Equity Deficit at March 31 -------------------------------------------------------------- General Environmental Management Inc.'s consolidated balance sheet at March 31, 2008, showed $14,260,632 in total assets and $14,603,458 in total liabilities, resulting in a $342,826 total stockholders' deficit. At March 31, 2008, the company's consolidated balance sheet also showed strained liquidity with $5,835,665 in total current assets available to pay $9,195,449 in total current liabilities. The company reported a net loss of $1,345,233, on revenues of $6,951,653, for the first quarter ended March 31, 2008, compared with a net loss of $4,581,903, on revenues of $6,317,380, for the same period ended March 31, 2007. The reduction in net loss was due to reductions in non-cash charges related to convertible debt instruments and the 2007 stock option plan. The increase in revenue can be attributed to increased revenue from K2M Mobile Treatment Services Inc. which was partially offset by a decrease in revenues in the Enviroconstruction market sector. 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?2d6a Going Concern Doubt Weinberg & Company, P.A., in Los Angeles, expressed substantial doubt about General Environmental Management 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 losses from operations since inception. About General Environmental Headquartered in Pomona, Calif., General Environmental Management Inc. (OTC BB: GEVI) -- http://www.go-gem.com/-- is a full-service hazardous waste management and environmental services firm providing integrated environmental solutions managed through its proprietary web-based enterprise software, GEMWare, including the following service offerings: management and transportation of waste; design and management of on-site waste treatment systems; management of large remediation projects; response to environmental incidents and spills; and environmental, health and safety compliance. The company operates seven field service locations and one Treatment, Storage, Disposal facility (TSDF), servicing all markets in the Western U.S. GLOBAL REALTY: Meyler & Co Expresses Going Concern Doubt -------------------------------------------------------- Meyler & Company, LLC, raised substantial doubt on the ability of Global Realty Development Corp. to continue as a going concern after it audited the company's financial statements for the year ended Dec. 31, 2007. The auditor pointed to the company's net losses in 2007 and 2006, accumulated deficit of $38,275,415 at Dec. 31, 2007, and the existence of uncertain conditions the company faces relative to its ability to obtain capital and operate successfully. Default in Senior Promissory Notes and Derivative Liabilities-Warrants The management also reported that during the third and fourth quarters of 2007, the company sold an aggregate of 2,325,000 Offering Units to six investors for an aggregate purchase price of $2,325,000. The Offering Units consist of 12% Senior Promissory Notes in an aggregate principal amount of $2,325,000; warrants to purchase an aggregate of 6,975,000 shares of company common stock; and, unless the company achieved a certain financing event, additional warrants to purchase an aggregate of 2,325,000 shares of the company's common stock. The company did not achieve one of the financing requirements and the Additional Warrants were issued on Oct. 1, 2007. In connection with the transaction and as part of the placement fee for the transaction, the company accrued certain cash fees payable to Halpern Capital, Inc., and issued warrants to purchase a total of 651,000 shares of its common stock representing 7% of the total of the warrants issued in the transaction (those issued with the notes and the Additional Warrants). The notes are currently in default. The shares of common stock underlying the warrants to purchase common stock issued in connection with the Offering Units are subject to registration at the company's expense within 120 days of the final closing under the Offering. In the event the company does not effect the registration of the warrant shares within the allotted timeframe, further additional warrants are issuable to the holders of the warrants. As of Dec. 31, 2007, the company has not filed the registration statement nor has it incurred an obligation to issue any additional warrants pursuant to this provision. The warrants contain anti-dilution provisions such that the exercise price will be adjusted in the event that the company issues common stock for a per share price less than the exercise price of the warrants. The warrants are exercisable at $0.30 per share. Financials The company posted a net loss of $15,984,242 on total revenues of $391 for the year ended Dec. 31, 2007, as compared with a net loss of $6,893,742 on total revenues of $205,026 in the prior year. The company also posted a loss from operations of $8,217,252 for the year ended Dec. 31, 2007, compared to a loss from operations of $7,956,909 for 2006. At Dec. 31, 2007, the company's balance sheet showed $7,710,785 in total assets, $5,738,059 in total liabilities, and a $1,972,726 stockholders' deficit. A full-text copy of the company's 2007 annual report is available for free at: http://ResearchArchives.com/t/s?2d28 About Global Realty Headquartered in Coral Springs, Fla., Global Realty Development Corp. (OTC BB: GRLY) -- http://www.grdcorporation.com/-- is an international land development company operating through various real estate development subsidiaries. Global recently acquired MJD Films and the majority interest in the TFM Group and is now focused on pursuing opportunities in the entertainment and gaming industry. GMAC LLC: S&P's Rating Unaffected by Refinancing Implementation --------------------------------------------------------------- Standard & Poor's Ratings Services said that GMAC LLC's (B/Negative/C) implementation of its refinancing plan will not affect the ratings on the company. GMAC LLC and its wholly owned subsidiary executed a comprehensive series of transactions, which include extending bank facilities, increasing the amount of available funding, and enhancing liquidity positions. Residential Capital LLC extended unsecured debt maturities through a debt exchange, renewed certain funding lines, and obtained liquidity support from GMAC LLC. The refinancing includes the refinancing of debt and new facilities, including both loan facilities and bond issues; GMAC LLC providing a $3.5 billion two-year credit facility to Residential Capital LLC, which includes $750 million of first loss protection from General Motors Corp. and Cerberus Capital Management L.P.; and $2.4 billion of actions taken by GMAC LLC and Cerberus Capital to provide Residential Capital LLC's near term liquidity. GOODY'S FAMILY: Clothing Stores Operator Might File for Bankruptcy ------------------------------------------------------------------ Goody's Family Clothing Inc. is expected to file for Chapter 11 bankruptcy early this week, reports citing Women's Wear Daily, say. It may shutter about 90 stores in a possible preparation for the filing. Creditors committee has been established, and lenders are being sought to provide the bankruptcy financing structure, the publication said on its Web site. The company has been closing some store locations since the beginning of the year, WWD said. The anticipated closings would reduce the store count to around the mid-200s, from 378 stores in January, according to the report. Headquartered in Knoxville, Tenn., Goody's Family Clothing operates about 380 small department stores in about 20 states, mainly in strip malls in the southeastern and midwestern U.S. The stores sell clothes, shoes, accessories, and gift items. Its brands include Dockers, Levi's, NIKE, Reebok, and Skechers, as well as its own labels, such as the new Ashley Judd line. Founded as Athens Outlet Stores in 1953, Goody's Family Clothing was taken private by investment firms Prentice Capital Management LP and GMM Capital LLC in early 2006. GP INVESTMENTS: Fitch Upgrades Foreign ID Rating to B+ from B ------------------------------------------------------------- Fitch Ratings has upgraded GP Investments Ltd. as: -- Foreign Currency IDR to 'B+' from 'B'; -- US$190 million perpetual notes to 'B+/RR4' from 'B/RR4'. The Rating Outlook is Stable. Fitch's rating action reflects the enhanced recurring cash flow of the company boosted by a larger size of assets under management and still conservative capital ratios. Also, GP's franchise and the experience of the management team that bodes well for positive prospects going forward were incorporated. The ratings are constrained, however, by the concentrated nature of the intended investment portfolio, the still volatile cash flow implied by recurring fixed expenses versus recurring income, and the uncertainty related to the maturation period of the investment portfolio and GP's ability to realize investment gains. GP is a Bermuda-exempted company that consolidates the activities of a private equity business and an asset management business in Latin America. GP's activities started in 1993 as an asset manager dedicated to private equity activities, managed by partners with substantial experience in the Brazilian market. The company is listed on the Luxembourg Stock Exchange and also has a BDS program on the Brazilian Stock Market (Bovespa). Since 1993, GP has built up a successful track record in the Brazilian private equity market, having invested more than US$4 billion in 47 companies in Brazil as of May 2008. Over time the company has refined its investment strategies. It currently looks to acquire investments only with control or joint control positions, with a preference for larger companies, and will not invest in start-ups and green field projects; while some limits regarding maximum exposures by company or sector are in place, GP's investment portfolio is, and will remain, concentrated. As of March 2008, GP managed a portfolio of 10 investments and has announced the subscription of two additional investments. The significant increase in the size of the investment portfolio up to US$1.088 billion at the end of March 2008, have resulted in a sustained increase in fee income which has almost reach a break even point for the coverage of recurring operating expenses. Historically total recurring income has not been sufficient to cover operating expenses, which have been funded through the income generated by the positive results of the valuation and exits in the investment portfolio and the maintenance of liquidity on hand for these purposes. Given the unpredictable nature of the results and timing of capital gains in the investment portfolio or of the possible positive results in future exits of those investments and the concentration of the portfolio, Fitch believes that a more ample array of recurring income would be needed to sustain current operating expenses, debt service and enhance the risk profile of the company. During 2008, GP was able to raise around US$240 million in additional equity from investors, which helped to sustain adequate capitalization ratios despite the increase of its financial debt. Going forward, Fitch expects that GP will keep a liabilities to equity ratio in the 60% region, being that this is a key strength of the company to cope with its current business model. GREEKTOWN CASINO: Court Gives Interim Nod on Cash Collateral Use ---------------------------------------------------------------- The Honorable Walter Shapero of the U.S. Bankruptcy Court for the Eastern District of Michigan authorized the Debtors, on an interim basis, to use the cash collateral of their prepetition lenders in accordance with a prepared budget. Pursuant to a Credit Agreement dated Dec. 2, 2005, as amended, Debtors Greektown Holdings, LLC, and Greektown Holdings II, Inc., borrowed money and obtained letters of credit from these secured lenders: * The Bank of New York * Bear Stearns Securities Corp. * BNP Paribas Securities Corp./Fixed Income * Brown Brothers Harriman & Co. * Citibank, N.A. * Dresdner Kleinwort Wasserstein Securities LLC * Jefferies & Company, Inc. * JPMorgan Chase Bank, N.A. * Mellon Trust of New England, N.A. * Merrill Lynch, Pierce, Fenner & Smith Incorporated * The Northern Trust Company * PNC Bank, National Association * State Street Bank and Trust Company * Investors Bank and Trust Company * U.S. Bank, N.A. * Wells Fargo Bank, National Association The agents for the Prepetition Secured Lenders are Merrill Lynch, Pierce, Fenner and Smith Incorporated; Merrill Lynch Capital Corporation; Wachovia Securities; National City Bank of the Midwest; Wells Fargo Bank, National Association; and Fifth Third Bank. The Prepetition Obligations are secured by a lien and security interest in substantially all of the Debtors' personal property assets as well as mortgages on substantially all of their real estate interests -- the Prepetition Cash Collateral. As of the date of bankruptcy, the Debtors' books and records showed that the outstanding principal balance of the obligations owing to the Prepetition Lenders was at least $44,626,000, plus accrued interest. The Debtors also obtained, before the bankruptcy filing, financing pursuant to the Taxable Economic Development Revenue Bonds and the Tax-Exempt Economic Development Revenue Bonds issued by the Economic Development Corporation of the City of Detroit. The Bonds are backed by a $49,360,000 letter of credit issued under the Prepetition Loan Agreement. The Bonds are not secured by any collateral other than the right to draw under the Bond Letter of Credit if the conditions set forth are met. As of the bankruptcy filing date, the Debtors' books and records showed that the outstanding principal balance owing with respect to the Bonds was $49,350,000, plus accrued but unpaid interest and all costs, expenses and attorneys' fees owing in accordance with the terms of the Bond Documents. Lenders' Consent & Adequate Protection The Prepetition Lenders have agreed to the use of Cash Collateral by the Debtors, contingent on, among other things, their receipt of the adequate protection provided in the DIP Facility. All of the Debtors' construction expenditures and cash flow will be set forth in a budget prepared on a rolling 13-week basis, as may be modified from time to time. A full-text copy of the budget the Debtors prepared for the 13- week period from June 2, 2008, through Aug. 31, 2008, is available for free at: http://researcharchives.com/t/s?2d4c The Debtors proposed to grant the Prepetition Lenders adequate protections including, among other things: (a) granting replacement liens on all assets of the Debtors, subject only to the Carve-Out under the DIP Facility; (b) granting superpriority status to the adequate protection obligations, subject to the payment of the Carve-Out); (c) satisfaction of the Exit Milestones; and (d) periodic cash payments to the Prepetition Secured Parties. The Court said that the budget may be modified with the consent of the DIP Lenders. The Court also directed the Debtors to provide the Prepetition Lenders adequate protection of their cash collateral, including the granting of replacement liens. About Greektown Casino Based in Detroit, Michigan, Greektown Holdings, LLC and its affiliates -- http://www.greektowncasino.com/-- operate world- class casino gaming facilities located in Detroit's historic Greektown district featuring over 75,000 square feet of casino gaming space with more than 2,400 slot machines, over 70 tables games, a 12,500-square foot salon dedicated to high limit gaming and the largest live poker room in the metropolitan Detroit gaming market. Greektown Casino employs approximately 1,971 employees, and estimates that it attracts over 15,800 patrons each day, many of whom make regular visits to its casino complex and related properties. In 2007, Greektown Casino achieved a 25.6% market share of the metropolitan Detroit gaming market. Greektown Casino has also been rated as the "Best Casino in Michigan" and "Best Casino in Detroit" numerous times in annual readers' polls in Detroit's two largest newspapers. The company and seven of its affiliates filed for Chapter 11 protection on May 29, 2008 (Bankr. E.D. Mich. Lead Case No. 08- 53104). Daniel J. Weiner, Esq., Michael E. Baum, Esq., and Ryan D. Heilman, Esq., at Schafer and Weiner PLLC, represent the Debtors in their restructuring efforts. Judy B. Calton, Esq., at Honigman Miller Schwartz and Cohn LLP, represents the Debtors as their special counsel. The Debtors chose Conway MacKenzie & Dunleavy as their financial advisor, and Kurtzman Carson Consultants LLC serves as the Debtors' claims, noticing, and balloting agent. When the Debtor filed for protection from its creditors, it listed consolidated estimated assets and debts of $100 million to $500 million. (Greektown Casino Bankruptcy News, Issue No. 3; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). GSV INC: Earns $216,677 in 2008 First Quarter Ended March 31 ------------------------------------------------------------ GSV Inc. reported net income of $216,677, on revenues of $354,543, for the first quarter ended March 31, 2008, compared with net income of $23,754, on revenues of $150,142, for the same period ended March 31, 2007. At March 31, 2008, the company's consolidated balance sheet showed $3,070,958 in total assets, $936,156 in total liabilities, and $2,134,802 in total stockholders' equity. The company's consolidated balance sheet at March 31, 2008, also showed strained liquidity with $641,877 in total current assets available to pay $811,511 in total current liabilities. 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?2d77 Going Concern Doubt As reported in the Troubled Company Reporter on April 8, 2008, UHY LLP, in New Haven, Connecticut, expressed substantial doubt about GSV 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 operating losses and negligible working capital. In addition, the company will be required to obtain financing to fund drilling and development to recover its investment in geologic studies and to pay certain indebtedness as it becomes due. About GSV Inc. Headquartered in Westport, Conn., GSV Inc. (OTC BB: GSVI) -- http://www.gsv.com/-- through its subsidiary Cybershop LLC, the company owns interests in certain oil and gas properties in Texas and an undivided one-third interest in Century Royalty LLC, a Texas limited liability company that manages the oil and gas properties in Texas. Through Cybershop it also owns an additional interest in the Louisiana properties, in which it already held an interest. HOME INTERIORS: Boulder Approved as Business Consultant and CRO --------------------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of Texas gave Home Interiors & Gifts, Inc., and its debtor-affiliates permission to employ Boulder International LLC, as Business Consultant and Chief Restructuring Officer. As reported in the Troubled Company Reporter on May 14, 2008, the firm have advised on a wide variety of engagements including restructurings, turnarounds, acquisitions, the sale of assets and divisions and subsidiaries, plant closings, takeovers, start-ups and global expansions, including establishing manufacturing in China, India and other countries around the world. The Debtors initially retained Boulder as of February 19, 2008. Boulder assisted the Debtors as their business consultant in connection with identifying and executing, on various restructuring strategies, developing a business plan and guiding the Debtors through significant restructuring efforts. The Debtors note that Richard A. Lindenmuth, manager of Boulder, has developed a great deal of institutional knowledge regarding the Debtors' operations, assets, capital structure, and related matters and has worked closely with the Debtors' management team and their other advisors. The Debtors told the Court that Boulder's employment at this point in the chapter 11 cases is necessary and appropriate to the timely preparation and confirmation of a plan of reorganization. Boulder may perform some or all of these services: -- Serve as Credit Restructuring Officer for Debtors; and -- Work with the Debtors' Board of Directors to preserve the value of Debtors' business. Boulder will be paid $50,000 per month and reimbursed of reasonable expenses. Upon execution of their employment agreement, the Debtors paid Boulder $25,000 for services rendered between the date the agreement was signed, and the end of May. Pursuant to the prepetition engagement, the Debtors paid Boulder an aggregate amount of $272,801 in fees and reimbursement of expenses. As of the Petition Date, Boulder has incurred and been paid for $175,000 in prepetition fees associated with assisting Debtors with their financial restructuring, attempting to sell Debtors's assets, and helping Debtors prepare for their bankruptcy filings. Boulder also has incurred and been paid $97,801 in expenses associated with its prepetition representation of the Debtors and their restructuring efforts. Mr. Lindenmuth attested that Boulder and its professionals are disinterested persons, within the meaning of Section 101(14) of the Bankruptcy Code and as required by Section 327(a). Moreover, Mr. Lindenmuth said, the firm does not hold or represent an interest adverse to the estate and does not have any connection with the Debtors, their creditors, or any other party-in-interest in the chapter 11 cases. Boulder International can be reached at: Boulder International LLC 10105 Old Warden Road Raleigh, North Carolina 27615 Attn: Richard Lindenmuth, Esq. Tel: (919) 870-1832 Fax: (919) 847-1783 About Home Interiors Headquartered in Carrollton, Texas, Home Interiors & Gifts, Inc. -- http://www.homeinteriors.com/-- manufactures, imports and distributes indoor and outdoor home decorative accessories. The company and six of its affiliates filed for Chapter 11 protection on April 29, 2008 (Bankr. N.D. Tex. Lead Case No.08-31961). Andrew E. Jillson, Esq., Cameron W. Kinvig, Esq., Lynnette R. Warman, Esq., and Michael P. Massad, Jr., Esq., at Hunton & Williams, LLP, represent the Debtors in their restructuring efforts. The U.S. Trustee for Region 6 has not appointed any creditors to serve on an Official Committee of Unsecured Creditors to date. When the Debtors file for protection against their creditors, they listed assets and debts between $100 million and $500 million. HOVNANIAN ENTERPRISES: Completes $600 Mil. Notes Offering --------------------------------------------------------- The amendment to the Seventh Amended and Restated Credit Agreement among Hovnanian Enterprises, Inc., K. Hovnanian Enterprises, Inc. and certain subsidiaries of Hovnanian and a group of lenders became effective. As reported in the Troubled Company Reporter on May 19, 2008, Hovnanian Enterprises entered into an amendment to its revolving credit agreement, which decreases total commitments thereunder to $300 million, increases the amount of collateral, and substantially eliminates maintenance covenants. In conjunction with the effectiveness of the amendment, K. Hovnanian issued $600,000,000 aggregate principal amount of 11- 1/2% Senior Secured Notes due 2013 guaranteed by Hovnanian and certain of its subsidiaries under an Indenture, dated as of May 27, 2008, among K. Hovnanian, Hovnanian and the other guarantors named therein and Deutsche Bank National Trust Company, as Trustee. Interest on the Notes is payable on May 1 and November 1 of each year, beginning on November 1, 2008. The Indenture contains restrictive covenants that limit, among other things, the ability of Hovnanian and certain of its subsidiaries, including K. Hovnanian, to incur additional indebtedness, pay dividends and make distributions on common and preferred stock, repurchase senior and subordinated notes and common and preferred stock, make other restricted payments, make investments, sell certain assets, incur liens, consolidate, merge, sell or otherwise dispose of all or substantially all of its assets and enter into certain transactions with affiliates. The Indenture also contains customary events of default which would permit the holders of the Notes to declare those Notes to be immediately due and payable if not cured within applicable grace periods, including the failure to make timely payments on the Notes or other material indebtedness, the failure to satisfy covenants, the failure of the documents granting security for the Notes to be in full force and effect, the failure of the liens on any material portion of the collateral securing the Notes to be valid and perfected and specified events of bankruptcy and insolvency. Each of Hovnanian's subsidiaries, except for its financial services subsidiaries, joint ventures and certain of Hovnanian's title insurance subsidiaries, is a guarantor of the notes. The notes and the guarantees will be secured, subject to permitted liens and other exceptions, by a second-priority lien on substantially all of the assets owned by K. Hovnanian, Hovnanian and the other guarantors to the extent such assets secure obligations under the amended credit agreement. Headquartered in Red Bank, New Jersey, Hovnanian Enterprises Inc. (NYSE: HOV) -- http://www.khov.com/-- is a homebuilder with operations in Arizona, California, Delaware, Florida, Georgia, Illinois, Kentucky, Maryland, Michigan, Minnesota, New Jersey, New York, North Carolina, Ohio, Pennsylvania, South Carolina, Texas, Virginia and West Virginia. The company's homes are marketed and sold under the trade names K. Hovnanian Homes, Matzel & Mumford, Forecast Homes, Parkside Homes, Brighton Homes, Parkwood Builders, Windward Homes, Cambridge Homes, Town & Country Homes, Oster Homes, First Home Builders of Florida and CraftBuilt Homes. Hovnanian is a member of the Public Home Builders Council of America -- http://www.phbca.org/-- a nonprofit group devoted to improving understanding of the business practices of America's largest publicly-traded home building companies, the competitive advantages they bring to the home building market, and their commitment to creating value for their home buyers and stockholders. The PHBCA's 14 member companies build one out of every five homes in the United States. Hovnanian is the 6th largest homebuilder in 2006 based on U.S. home closings, according to data compiled by Builder magazine. Hovnanian sold 20,201 homes, a 14% rise from the previous year, and had gross revenue of $7,016,000,000, Builder magazine says. * * * As reported in the Troubled Company Reporter on May 21, 2008, Standard & Poor's Ratings Services lowered its issue-level rating on Hovnanian Enterprises Inc.'s $1.5 billion senior unsecured notes to 'CCC+' from 'B-'. Concurrently, S&P affirmed its 'B-' corporate credit rating assigned to Hovnanian. All other ratings remain unchanged. The outlook is negative. Fitch Ratings has assigned a 'BB-/RR1' rating on Hovnanian Enterprises, Inc.'s (NYSE: HOV) $600 million 11.5% senior secured notes due 2013. In addition, Fitch affirms these ratings for HOV: Issuer Default Rating (IDR) at 'B-'; Senior secured revolving credit facility at 'BB-/RR1'; Senior unsecured notes at 'B-/RR4'; Senior subordinated notes at 'CCC/RR6'; and Series A perpetual preferred stock at 'CCC-/RR6'. HOV's Rating Outlook is Negative. IBIS TECHNOLOGY: KPMG LLP Expresses Going Concern Doubt ------------------------------------------------------- In a letter dated May 22, 2008, KPMG LLP raised substantial doubt on the ability of Ibis Technology Corporation to continue as a going concern after it audited the company's financial statements for the year ended Dec. 31, 2007. The auditing firm pointed to the company's recurring losses from operations. The company posted a net loss of $8,539,812 on total net sales and revenues of $951,191 for the year ended Dec. 31, 2007, as compared with a net income of $404,885 on total net sales and revenues of $13,987,419 in the prior year. At Dec. 31, 2007, the company's balance sheet showed $9,762,833 in total assets, $731,591 in total liabilities, and $9,031,242 in stockholders' equity. A full-text copy of the company's 2007 annual report is available for free at: http://ResearchArchives.com/t/s?2d27 About Ibis Technology Ibis Technology Corporation (Nasdaq GM: IBIS) -- http://www.ibis.com/-- is a provider of oxygen implanters for the production of SIMOX-SOI (Separation-by-Implantation-of-Oxygen Silicon-On-Insulator) wafers for the worldwide semiconductor industry. Headquartered in Danvers, Massachusetts, Ibis Technology is traded on Nasdaq under the symbol IBIS. IDEARC INC: Appoints Scott Klein as Chief Executive Officer ----------------------------------------------------------- Scott W. Klein was appointed as Chief Executive Officer of Idearc Inc., effective May 30, 2008. Mr. Klein has also been appointed to the company's Board of Directors. Prior to joining the company, Mr. Klein, age 50, served as an Operating Partner of Symphony Technology Group, a private investment firm, since 2007. From 2004 to 2007, Mr. Klein served as President and Chief Executive Officer of Information Resources, Inc., a provider of information solutions for the consumer packaged goods, retail and healthcare industries. Prior to joining Information Resources, Mr. Klein served as President, Consumer Industries, Retail and Energy Global Industry Group of Electronic Data Systems Corporation from 2001 to 2004. Mr. Klein also held management positions with PC Mall, Inc., PrimeSource Building Products, Inc., PepsiCo, Inc. and The Procter & Gamble Company earlier in his career. In connection with his appointment as Chief Executive Officer, the company entered into an employment agreement with Mr. Klein on May 21, 2008. The agreement expires on May 31, 2011, unless extended. The term of the agreement is automatically extended for additional one-year periods unless either party provides notice not to extend the term at least six months prior to the applicable expiration date. Under the agreement, Mr. Klein's annual base salary will be no less than $1,000,000 and he will be eligible to earn a target annual short-term incentive award of no less than 100% of his base salary. For 2008, Mr. Klein is guaranteed a minimum short-term incentive award of $500,000 and received a one- time cash award of $400,000 upon joining the company. Under his agreement, Mr. Klein is entitled to a target annual long-term incentive award opportunity of no less than 300% of his base salary. For 2008, his long-term incentive award will be in the form of performance share units (70%) and restricted stock (30%), prorated based upon his number of months of service with the Company during 2008. Mr. Klein will also receive stock options to purchase 250,000 shares of the company's common stock. The stock options will have a per-share exercise price equal to the closing price of the company's common stock on June 2, 2008, the first trading day of the month following Mr. Klein joining the company. The stock options will vest on May 31, 2011 and will be granted under the Idearc Inc. 2008 Incentive Compensation Plan. In the event his employment is terminated, Mr. Klein may be entitled to severance payments in varying amounts depending on the circumstances. Mr. Frank Gatto, the company's former interim Chief Executive Officer, returned to his prior position as the Company's Executive Vice President - Operations. The Human Resources Committee awarded Mr. Gatto 87,065 shares of restricted stock as additional equity compensation for his service as interim Chief Executive Officer. Effective June 2, 2008, W. Scott Hanle is no longer an officer of the company. Mr. Hanle will continue as an employee of the company for a period of approximately 30 days to assist with the transition of his prior responsibilities. Mr. Hanle will be entitled to the severance and other benefits under the company's Executive Transition Plan. Dallas, Texas-headquartered Idearc Inc. (NYSE: IAR) -- http://www.idearc.com/-- is yellow pages directories publisher in the United States. Its products include print yellow pages, print white pages, an Internet yellow pages directory, Superpages.com and an information directory for wireless subscribers, Superpages MobileSM. The company publishes its directories in approximately 360 markets in 35 states across the United States and the District of Columbia. The company completed its spin-off from Verizon on Nov. 17, 2006, but had various agreements with Verizon, including a 30-year publishing agreement as the official publisher of Verizon print directories with rights to publish yellow pages under the Verizon brand in both its incumbent and independent markets. On July 20, 2006, it purchased Inceptor Inc., a provider of Internet search engine marketing technology. At March 31, 2008, the company's balance sheet show a stockholders' deficit of $8,628,000,000, compared to a deficit of $8,600,000,000 at Dec. 31, 2007. * * * As reported in the Troubled Company Reporter on April 7, 2008, Moody's Investors Service downgraded Idearc Inc.'s Corporate Family rating to B1 from Ba3. The rating action concludes the review for possible downgrade initiated by Moody's on Feb. 27, 2008, following the release of the company's fourth quarter 2007 earnings. As reported in the Troubled Company Reporter on April 1, 2008, Standard & Poor's Ratings Services placed its ratings on Idearc Inc., including the 'BB' corporate credit rating, on CreditWatch with negative implications. IMPERIAL INDUSTRIES: Posts $1,955,000 Net Loss in 2008 1st Quarter ------------------------------------------------------------------ Imperial Industries Inc. reported a net loss of $1,955,000, on net sales of $9,346,000, for the first quarter ended March 31, 2008, compared with net income of $381,000, on net sales of $16,531,000, for the same period ended March 31, 2007. S. Daniel Ponce, Imperial's chairman of the Board, stated: "The 2008 first quarter, traditionally the slowest seasonal quarter for construction activity in our markets, continued to be adversely impacted by the decline in residential construction activity which commenced in 2006. "While the company has made investments in new product inventory, additional sales personnel and selected capital improvements to support the sale of an expanded line of products during the quarter, we have subsequently scaled back capital spending and taken other actions to reduce expenses in view of the continuing downturn in construction. "We have closed an under-performing distribution facility in Panama City Beach, Florida, initiated reductions in our workforce and are continuing to evaluate the elimination of other expenses which would not have a negative impact on sales. Although we incurred start-up losses in the first quarter associated with the opening of our new distribution facility in New Orleans, Louisiana, we remain optimistic about the long-term business prospects for that location. "We continue to closely monitor business conditions at each of our facilities during this difficult market environment and will take such actions as are necessary for us to remain strong operationally and be in position to take advantage of opportunities when market conditions improve.” Balance Sheet At March 31, 2008, the company's consolidated balance sheet showed $20,812,000 in total assets, $10,810,000 in total liabilities, and $10,002,000 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?2d68 Going Concern Doubt As reported in the Troubled Company Reporter on April 29, 2008, Grant Thornton LLP, in Fort Lauderdale, Fla., expressed substantial doubt about Imperial Industries Inc.'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 industry in which the company is operating has been impacted by a number of adverse factors over the past 24 months. As a result, the company has incurred losses for the three months ended March 31, 2008, and the year ended Dec. 31, 2007. About Imperial Industries Based in Pompano Beach, Fla., Imperial Industries, Inc. (Nasdaq: IPII) -- http://www.imperialindustries.com/ -- is a building products company. The company sells products throughout the Southeastern United States with facilities in the States of Florida, Georgia, Mississippi, Alabama and Louisiana. ISCO INTERNATIONAL: Names Gary Berger as New Financial Chief ------------------------------------------------------------ ISCO International, Inc. disclosed the appointment of accounting management specialist Gary Berger as chief financial officer. "We are pleased to have Gary on board," Gordon Reichard Jr., ISCO president and CEO, said. "The breadth of his background and scope of his experience in diverse industry settings prepare him amply for this critical role at ISCO." Previous to ISCO, Mr. Berger served as senior vice president and CFO at Barrington-based Orius Corporation. Prior to that Mr. Berger held leadership posts at SBC/Ameritech (now AT&T), Esmark and Deloitte & Touche. He is a CPA and a member of the AICPA and Illinois CPA Society. Mr. Berger has an MBA in Finance from DePaul University and a BS in Accounting from Illinois State University. In other company news, ISCO inked deals with The Magis Group for sales acceleration, marketing and general sales support, and with New York-based Bergstraesser Communications for public relations and communications support. The Magis Group has partnered with ISCO to help provide performance-based leadership consulting, support the growth of ISCO's sales channels and fine-tune the company's overall market focus. "ISCO looks forward to a productive relationship with a venerable organization like The Magis Group," said Mr. Reichard. "When added together, the Magis principals comprise a couple hundred years of experience -- and Magis seems to balance that combined experience with a reputation for nimble, progressive business consulting." Bergstraesser, a corporate communications veteran with significant corporate and agency experiences in Chicago and New York, runs an independent consultancy with clients in New York, Chicago, DC and Boston. "Ed brings a solid background steeped in agency and corporate communications -- and has directed a range of programs, including important roles at AT&T and MCI," Mr. Reichard said. "We look forward to working with him." About ISCO International Headquartered in Elk Grove Village, Ill., ISCO International Inc. (AMEX: ISO) -- http://www.iscointl.com/-- is a supplier of RF management and interference-control solutions for the wireless telecommunications industry. Going Concern Doubt As reported in the Troubled Company Reporter on April 18, 2008, Grant Thornton LLP, in Chicago, expressed substantial doubt about ISCO International Inc.'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 reported that the company incurred a net loss of approximately $6.4 million during the year ended Dec. 31, 2007, and, as of that date, the company's accumulated deficit was approximately $171.0 million. The auditing firm also said that the company has consistently used, rather than provided, cash in its operations. JEFFERSON COUNTY: Hires Merrill Lynch as Adviser on Debt Talks -------------------------------------------------------------- Jefferson County commissioners voted unanimously to retain Merrill Lynch & Co. as adviser in the county's restructuring of $3.2 billion of sewer bonds. New York-based Merrill Lynch will work with the county's Birmingham-based adviser Porter, White & Co. It will also perform financial analysis on the sewer debt, review restructuring proposals and negotiate with creditors, Martin Z. Braun of Bloomberg News reports. The firm has agreed not underwrite any new bond issue as part of a restructuring, commission President Bettye Fine Collins told Bloomberg in a telephone interview. Merrill Lynch will be paid $75,000 per month. Its team will include Christopher Fink, a managing director, the report said. Merrill Lynch hasn't been involved in the county's sewer debt financings. Jefferson County attorneys and the bond insurers are in negotiations to reset the county's debt structure. Without restructuring, annual payments could soar to $250 million, Reuters reports. As reported by the Troubled Company Reporter on June 5, 2008, the Commission unanimously approved an agreement to extend to Aug. 1 a $47 million sewer debt payment due to eight banks. After several extensions, the county was scheduled to pay $47 million of its sewer debt on June 1 and another payment of $53 million due on July 1. Under the new agreement, the county will pay $10.6 million toward the principal owed to banks including Regions Bank and Bank of America Corp. The county's bond insurers would also pay $10.6 million of the debt. Jefferson County has $4.6 billion in overall debt, including $3.2 billion in sewer bonds. The county was required to post a collateral on interest-rate swaps tied to the bonds after a series of downgrades on the debt. Two of the firms that guarantee to make the payments on Jefferson County's sewer bonds in the event of default were FGIC Corp. and XL Capital Assurance Inc. FGIC insured $1.56 billion of Jefferson County auction-rate securities, and XL Capital backed $397 million of the bonds. XLCA said that as of June 2, 2008, the Company's exposure to Jefferson County was $810 million, net of reinsurance. XLCA has not established any loss reserves at this time in connection with Jefferson County. About Jefferson County Jefferson County has its seat in Birmingham. It has a population of 660,000. It ended its 2006 fiscal year with a $42.6 million general fund balance, according to Standard & Poor's. Patrick Darby, a lawyer with the Birmingham firm of Bradley Arant Rose & White, represents Jefferson County. Porter, White & Co. in Birmingham is the county's financial adviser. A bankruptcy by Jefferson County stands to be the largest municipal bankruptcy in U.S. history. * * * As reported by the TCR on March 28, 2008, Moody's Investors Service downgraded to Caa3 from B3 the rating on the $3.2 billion outstanding sewer revenue warrants. Moody's said the county has not presented a concrete plan that would prevent a default on its sewer obligations. The county has publicly proposed using excess funds generated by a countywide 1% sales and use tax, currently securing the outstanding school warrants. The tax generated an additional $27 million in fiscal 2007 over the school warrant debt service; the initial intention was to use the excess for early redemption of debt. This proposal would require state legislation and it is unclear that the additional funds would provide enough revenue to cover the county's sewer obligations. As reported by the TCR on April 2, 2008, Standard & Poor's Ratings Services lowered its underlying rating on Jefferson County's series 2003 B-2 through 2003 B-7 sewer revenue refunding warrants to 'D' from 'CCC' due to the sewer system's failure to make a principal payment on the warrants when due on April 1, 2008, in accordance with the terms of the standby warrant purchase agreement. As reported by the TCR on April 10, 2008, Moody's Investors Service downgraded the rating on $800,000 of outstanding Jefferson County Assisted Housing Corporation, First Mortgage Refunding Housing Revenue Bonds (Spring Gardens Project) Series 1999 to Ba2 from Baa1. The outlook has been revised to negative from stable. The downgrade is based on a significant decline in debt service coverage, resulting from an increase in property expenses and a lack of rental rate increases. JEVIC TRANSPORTATION: U.S. Trustee Forms 3-Member Creditors Panel ----------------------------------------------------------------- Roberta A. DeAngelis, the U.S. Trustee for Region 3, appointed five creditors to serve on an Official Committee of Unsecured Creditors for Jevic Transportation Inc. and its debtor-affiliates. The creditors committee members are: 1) Central Freight Lines, Inc. Attn: Barney L. Knight, Jr. 5601 West Waco Drive Waco, Texas 76710 Tel: (254) 741-5525 Fax: 254-741-5384 2) Irving Oil Corporation Attn: Jim Sepanski 170 Commerce Way Portsmouth, New Hampshire 03801 Tel: (603) 559-8924 Fax: (603) 559-8791 3) Sun Logistics NYC, Inc. Attn: Todd M. Breen 46-60 55th Avenue Maspeth, New Yor 11378 Tel: (718) 730-7979 Fax: (718) 730-7997 4) Automotive Rentals, Inc. Attn: Richard E. Moyer 9000 Midlantic Drive, P.O. Box 5039 Mt. Laurel, New Jersey 08054 Tel: (856) 914-7555 Fax: (856) 608-7151 5) Benton Express Attn: Vicki Cordero Lynes 1045 S. River Industrial Boulevard Atlanta, Georgia 30315 Tel: (404) 267-2246 Fax: (404) 267-2201 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 Jevic Transportation Inc. Based in Delanco, New Jersey, Jevic Transportation Inc. -- http://www.jevic.com/-- provides trucking services. The company has two units: Jevic Holding Corp. and Creek Road Properties. Neither of the units have assets nor operations. The company and its affiliates filed for chapter 11 protection on May 20, 2008 (Bankr. D. Del. Case No. 08-11008). Domenic E. Pacitti, Esq., at Klehr Harrison Harvey Branzburg & Ellers, in Wilmington, Delaware, represents Jevic Transportation. When the Debtors' filed for protection against their creditors, they listed assets and debts between $50 million to $100 million. JEWETT TUCKER: Case Summary & Six Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Jewett W. Tucker, Jr. 2245 Crawford Smithonia Road Colbert, GA 30628 Tel: (404) 659-1410 Bankruptcy Case No.: 08-40990 Chapter 11 Petition Date: June 5, 2008 Court: Southern District of Georgia (Savannah) Debtor's Counsel: James L. Drake, Jr., Esq. James L. Drake, Jr. P.C. P.O. Box 9945 Savannah, GA 31412 Tel: (912) 790-1533 E-mail: jdrake7@bellsouth.net Estimated Assets: $50 million to $100 million Estimated Debts: $10 million to $50 million Debtor's list of its Six Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Lanyard Development Inc. $1,000,000 6029-C Ogeechee Road Savannah, GA 31419 Merchants & Farmers Bank Guaranty $550,000 P.O. Box 316 Colbert, GA 30628 Martin Snow LLP Legal Fees $100,000 240 Third Street Macon, GA 31201 Mike Wilson $60,000 Gayle & Associates $15,000 Kimley Horn & Associates $13,000 JOEY STEINFELDT: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Joey B. Steinfeldt Kristi R. Steinfeldt 4760 S.W. Trail Road Tualatin, Oregon 97062 Bankruptcy Case No.: 08-32709 Chapter 11 Petition Date: June 5, 2008 Court: District of Oregon Judge: Elizabeth L. Perris Debtors' Counsel: Ted A. Troutman, Esq. (tedtroutman@sbcglobal.net) 16100 N.W. Cornell Road, Suite #200 Beaverton, Oregon 97006 Tel: (503) 292-6788 Total Assets: $3,398,219 Total Debts: $2,689,183 A copy of the Debtor's petition is available for free at: http://bankrupt.com/misc/oreb08-32709.pdf JOHN HENSLEY: Voluntary Chapter 11 Case Summary ----------------------------------------------- Debtor: John A. Hensley, Jr. Joanne M. Hensley 11 Yorktown Court Front Royal, VA 22630-4260 Bankruptcy Case No.: 08-50573 Chapter 11 Petition Date: June 4, 2008 Court: Western District of Virginia (Harrisonburg) Debtor's Counsel: William L. Stables, Jr., Esq. (bstables@ntelos.net) 57 South Main Street, Suite 209 Harrisonburg, VA 22801 Tel: (540) 434-0337 Estimated Assets: $1,286,400 Estimated Debts: $1,623,030 JULIETTE MYUNG LEE: Case Summary & 12 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: Juliette Myung Lee aka Julie Myung Young Jin Lee 5425 El Greco Dr Stockton, CA 95212 Bankruptcy Case No.: 08-27500 Chapter 11 Petition Date: June 5, 2008 Court: Eastern District of California (Sacramento) Debtors' Counsel: Keith Carr, Esq. PO Box 27547 San Francisco, CA 94127-0547 Tel: (415) 676-7537 Estimated assets: $1,000,001 to $10,000,000 Estimated debts: $1,000,001 to $10,000,000 A copy of the Debtor's petition and a list of its 12 largest unsecured creditors are available at no charge at: http://bankrupt.com/misc/caeb08-27500.pdf LANDSOURCE COMMUNITIES: Files for Chapter 11 in Wilmington ---------------------------------------------------------- LandSource Communities Development LLC and 20 of its affiliates filed for chapter 11 bankruptcy protection before the U.S. Bankruptcy Court for the District of Delaware Sunday night, after it failed to reach agreement with lenders on a plan to modify and restructure its debt. The Debtors are being represented by Mark D. Collins, Esq., at Richards, Layton & Finger in Wilmington, Delaware. For several months LandSource has attempted to reach agreement with its lenders on an interim plan that would provide the needed time for a complete review of its financial situation and the development of a long-term solution to the situation in which the partnership, like others in the real estate industry, currently finds itself, the company said in a news statement announcing the bankruptcy filing. As reported by the Troubled Company Reporter on May 22, 2008, LandSource sought help from its lender consortium in order to restructure $1.24 billion of its debt. LandSource in May engaged a 100-bank lender group led by Barclays Capital Inc., which syndicates LandSource's debt. CNNMoney reported that the real estate developer obtained a default notice in May on that debt from the lender group after it was not able to timely meet its payments during mid-April. LandSource's real estate assets, located in Santa Clarita Valley in Southern California, were appraised to $2.6 billion during early 2007. According to CNNMoney, the April payment carried an additional charge due to the decline of the property's value, brought about by the country's mortgage crisis. "LandSource believes chapter 11 provides the most effective means for the partnership to preserve the value of its business, meet postpetition obligations and maintain constituents' confidence while it works with creditors to achieve a long-term restructuring," spokeswoman Tamara Taylor at Sitrick and Company, said. LandSource said that, notwithstanding further retrenchments in both the California and national real estate markets, it expects not only to survive the current real estate downturn and credit crunch, but to flourish once the market stabilizes. LandSource has received commitments for debtor-in-possession financing from a group of lenders led by Barclay's Bank, including a $135,000,000 revolving line of credit that will enable the company to meet postpetition obligations and fund operations during the chapter 11 period. LandSource said that the DIP facility assures that vendors, contractors and consultants will be paid for goods and services provided after the June 8, 2008 filing date. LandSource is a partnership that includes the California Public Employees' Retirement System and home builder Lennar Corporation. It owns thousands of acres of land in California, including 15,000 acres north of downtown Los Angeles. LandSource, which operates in Arizona, California, Florida, New Jersey, Nevada and Texas, is involved in the planning and development of master planned communities and transforming undeveloped land into ready-to-build home sites and commercial properties. With the exception of one development project in Marina del Rey, California, LandSource does not build homes or commercial properties. Based in Miami, Florida, Lennar Corporation (NYSE: LEN and LEN.B) -- http://www.lennar.com/-- founded in 1954, builds affordable, move-up and retirement homes primarily under the Lennar brand name. Lennar's Financial Services segment provides mortgage financing, title insurance, and closing services for both buyers of the company's homes and others. LEELAND STATION: Voluntary Chapter 11 Case Summary -------------------------------------------------- Debtor: Leeland Station, LLC 2401 Research Boulevard, Suite 200 Rockville, MD 20850 Bankruptcy Case No.: 08-16833 Chapter 11 Petition Date: May 19, 2008 Court: District of Maryland (Greenbelt) Judge: Hon. Paul Mannes Debtor's Counsel: James A. Vidmar, Jr. (jvidmar@linowes-law.com) Linowes and Blocher 7200 Wisconsin Ave., Suite 800 Bethesda, MD 20814-4842 Telephone (301) 961-5126 Estimated Assets: $0 to $50,000 Estimated Debts: $10,000,001 to $50 million The Debtor did not file a list of its largest unsecured creditors. LEINER HEALTH: Sale Lambasted; Can Not Assign Pacts, Gov't Says --------------------------------------------------------------- The United States, on behalf of the Defense Commissary Agency, together with several creditors object to the sale of substantially all assets of Leiner Health Products Inc. and its debtor-affiliates. The United States government protests to the assignment and assumption of two resale ordering agreements -- HDEC01-05-G-3321 and HDEC01-05-G-3322 -- as provided in the sale. It explains that these contracts, which are governed by the anti-assignment act, can not be transfered to another party without government approval. Creditor Advanced Beauty Systems Inc., which entered into a trademark license agreement with the Debtors, disagrees with the assignment and assumption of executory contracts because all have expired after it completed the payment of the $1,000,000 royalty required to acquire trademarks of the Debtors. However, Advanced Beauty says that the agreement can be assumed and assigned if the Debtors cures any default. Some parties object to the cure amounts the Debtors listed in the notices they have filed with the Court. The amount due to the parties is $398,582 in the aggregate. As reported in the Troubled Company Reporter on June 3, 2008, the Debtors entered on May 30, 2008, into an asset purchase agreement for the sale of all assets to NBTY, Inc. for $230,000,000 plus assumption of certain liabilities, subject to a purchase price adjustment. NBTY and Leiner also entered into an escrow agreement pursuant to which a portion of the purchase price is held in escrow until the closing of the purchase transaction. As reported in the Troubled Company Reporter on April 17, 2008, the Court approved the Debtors' proposed bidding procedures for the sale of substantially all of their assets. An auction will take place on June 9, 2008, followed by sale hearing on June 11, 2008, at 1:30 p.m. Objections, if any, are due June 4, 2008. The transaction will close by September 2008, if no qualified offer is submitted. To determine the best offer, each interested bidder must submit its offer along with a 10% cash deposit by May 30, 2008, to Leiner Health Products Inc.; Houlihan Lokey Howard & Zukin Capital Inc., the Debtors' financial advisor and investment banker; and Kirkland & Ellis LLP, the Debtors' proposed counsel. During the auction to be held at Kirkland & Ellis in New York, and bids will be made in increments of at least $500,000 higher than the previous bid. According to the asset purchase agreement, all deposits will be returned to each bidder not selected by the Debtors as the successful bidder. About Leiner Health Based in Carson, California, Leiner Health Products Inc. -- http://www.leiner.com/-- manufacture and supply store brand vitamins, minerals and nutritional supplements products, and over- the-counter pharmaceuticals in the US food, drug and mass merchant and warehouse club retail market. In addition to their primary VMS and OTC products, they provide contract manufacturing services. During the fiscal year ended March 31, 2007, the VMS business comprised approximately 61% of net sales. On March 20, 2007, they voluntarily suspended the production and distribution of all OTC products manufactured, packaged or tested at its facilities in the US. The company filed for Chapter 11 protection on March 10, 2008 (Bankr. D. Del. Lead Case No.08-10446). Jason M. Madron, Esq., and Mark D. Collins, Esq., at Richards, Layton & Finger, P.A., represent the Debtors. Houlihan Lokey Howard & Zukin Capital, Inc., provides investment banking and financial advisory services to the Debtors. Garden City Group Inc. serves as the Debtors' noticing, claims and balloting agent. The U.S. Trustee for Region 3 appointed creditors to serve on an Official Committee of Unsecured Creditors in these cases. The Committee is represented by Saul Ewing LLP as bankruptcy counsel, and FTI Consulting Inc., as financial advisors. As reported in the Troubled Company Reporter on April 10, 2008, the Debtors' schedules of assets and liabilities showed total assets of $133,412,547 and total debts of $477,961,526. LEVEL 3: Completes $129MM Advertising Distribution Business Sale ---------------------------------------------------------------- Level 3 Communications, Inc. completed the sale of the advertising distribution business of Vyvx LLC, to DG FastChannel, Inc. Level 3 has retained ownership of Vyvx and its core broadcast business, including all of the Vyvx Services Broadcast Business' content distribution capabilities. Level 3 received gross proceeds at closing of approximately $129 million in cash. The purchase price is subject to customary working capital and certain other post- closing price adjustments. As reported in the Troubled Company Reporter on Dec. 21, 2007, Level 3 signed a definitive agreement to sell the advertising distribution business to DG FastChannel. Vyvx, LLC is a wholly owned subsidiary of Level 3 Communications, LLC. Revenue and Adjusted EBITDA for the Vyvx Services Advertising Distribution Business for 2007 are expected to be approximately $36 million and $11 million, respectively. Level 3 will retain ownership of Vyvx, LLC, and its core broadcast business including all of the Vyvx Services Broadcast Business' content distribution capabilities. Level 3 will also retain an ongoing network services relationship with DG FastChannel, enabling DG FastChannel to distribute advertising content between its regional offices. Headquartered in Broomfield. Colorado, Level 3 Communications Inc. (NASDAQ:LVLT) -- http://www.level3.com/-- is engaged in the communications business. Level 3 is a facilities-based provider of integrated communications services. As of Dec. 31, 2006, the company had approximately 73,000 intercity route miles in the United States and Europe, connecting 16 countries. As of Dec. 31, 2006, the company had metropolitan fiber networks in approximately 125 markets in the United States and Europe, which contain approximately 25,000 route miles and connect in the aggregate approximately 6,500 traffic aggregation points and buildings. During the year ended Dec. 31, 2006, the company acquired Content Delivery Network services business of SAVVIS Inc., Broadwing Corporation, TelCove Inc., ICG Communications Inc., Progress Telecom LLC and Looking Glass Networks Holding Co. Inc. On Sept. 7, 2006, the company sold Software Spectrum Inc. to Insight Enterprises Inc. * * * Moody's Investor's Service assigned these ratings to Level 3 Communications Inc. on June, 2006: 'Caa1' long-term corporate family rating, 'Caa2' senior unsecured debt rating, 'Caa3' subordinated debt rating, 'Caa1' probability of default rating and gave a stable outlook. The rating actions still hold to date. LEXINGTON PRECISION: Malin Bergquist Raises Going Concern Doubt --------------------------------------------------------------- Malin, Bergquist & Company, LLP, raised substantial doubt on the ability of Lexington Precision Corporation to continue as a going concern after it audited the company's financial statements for the year ended Dec. 31, 2007. The auditing firm pointed to the company's bankruptcy filing. In a letter dated May 15, 2008, the auditor reported that on April 1, 2008, Lexington Precision Corporation and Lexington Rubber Group, Inc., filed voluntary petitions seeking reorganization relief under the provisions of chapter 11 of the United States Bankruptcy Code and its continuation as a going concern is contingent upon, among other things, the Debtors ability to comply with the terms and conditions of the debtors-in- possession financing arrangements; to obtain confirmation of a plan of reorganization under the Bankruptcy Code; to generate sufficient cash flow from operations to fund working capital, capital expenditures and debt service requirements; and to obtain financing sources to meet future obligations. The company posted a net loss of $6,959,000 on net sales of $88,408,000 for the year ended Dec. 31, 2007, as compared with a net loss of $7,349,000 on net sales of $87,901,000 in the prior year. At Dec. 31, 2007, the company's balance sheet showed $52,367,000 in total assets and $88,308,000 in total liabilities, resulting in $35,941,000 stockholders' deficit. The company's consolidated balance sheet at Dec. 31, 2007, also showed strained liquidity with $21,877,000 in total current assets available to pay $87,771,000 in total current liabilities. A full-text copy of the company's 2007 annual report is available for free at http://ResearchArchives.com/t/s?2d58 Bankruptcy Filing On April 1, 2008, the company filed a voluntary petition for relief under chapter 11 of the Federal Bankruptcy Code in the United States Bankruptcy Court for the Southern District of New York. The company said it has experienced no disruptions in its operations to date and, based upon discussions with a significant number of major suppliers and customers, it does not expect any such disruption during the term of the chapter 11 proceedings. The company intends to file a plan of reorganization with the Bankruptcy Court no later that June 30, 2008, and hope to confirm that plan by Sept. 30, 2008. The company expects that its plan of reorganization will result in a significant reduction in its aggregate indebtedness by means of a conversion of a significant portion of its subordinated debt to equity at a valuation that is reflective of the offers that were received during the sale process. The company says it also intends to retain all of its operations, including the Rock Hill facility. The company's aggregate indebtedness at March 31, 2008, totaled $70,497,000 plus $9,219,000 of accrued interest on its subordinated debt, compared to $69,091,000 plus $7,564,000 of accrued interest on its subordinated debt at Dec. 31, 2007. About Lexington Precision Based in New York, Lexington Precision Corp. -- http://www.lexingtonprecision.com/-- manufactures tight-tolerance rubber and metal components for use in medical, automotive, and industrial applications. As of Feb. 29, 2008, the companies employed about 651 regular and 22 temporary personnel. The company and its affiliate, Lexington Rubber Group Inc., filed for Chapter 11 protection on April 1, 2008 (Bankr. S.D.N.Y. Lead Case No.08-11153). Richard P. Krasnow, Esq., at Weil, Gotshal & Manges, represents the Debtors in their restructuring efforts. The Debtors selected Epiq Bankruptcy Solutions LLC as claims agent. The U.S. Trustee for Region 2 appointed seven creditors to serve on an Official Committee of Unsecured Creditors. When the Debtors filed for protection against their creditors, they listed total assets of $52,730,000 and total debts of $88,705,000. LIBERTY TAX: Is Neutral to Peachtree's Unsolicited Tender Offer --------------------------------------------------------------- Liberty Tax Credit Plus III L.P. responded to an unsolicited tender offer by Peachtree Partners to purchase up to 4.9% of the 139,101 outstanding limited partnership units of Liberty at a price of $17.75 per unit, less certain reductions to that purchase price, as described in the Peachtree's written tender offer materials dated May 15, 2008. The Offeror is not affiliated with Liberty or its general partner. Liberty expresses no opinion and is neutral with respect to whether or not unit holders should tender their units in response to the Offer. As Liberty has previously disclosed to its unit holders, Liberty is in the process of liquidating its portfolio of investments in other limited partnerships. It is uncertain at this time how much money, if any, will be realized by Liberty and its unit holders from the liquidation of Liberty's investments. Liberty notes that the partnership has made distributions in the past from the disposition of its investments, but that there can be no assurances what further dispositions or distributions, if any, may occur in the future. Liberty further notes that future distributions, if any, may be greater or less than the price of the Offer. Accordingly, Liberty takes no position on whether or not the Offer and its purchase price are attractive or unattractive to unit holders from an economic point of view. In addition, unit holders may also wish to consider: First, the Offer raises certain questions about its potential impact on Liberty's tax status for federal income tax purposes. Liberty is currently treated, and has since its inception been treated, as a partnership and a pass-through entity for federal income tax purposes -- a tax status that is desirable and beneficial to Liberty and its investors. That beneficial tax status might be lost, and Liberty might be taxed as a corporation, if it were deemed to be a "publicly traded partnership" within the meaning of the Internal Revenue Code and certain regulations promulgated by the Internal Revenue Service. It is uncertain whether or not the Offer, if consummated, might cause Liberty to be deemed a "publicly traded partnership" since the Offer by itself and/or in combination with other transfers of Liberty's units, could result in a transfer of more than two percent of the interests in Liberty during the year, which might prevent it from relying on an Internal Revenue Service "safe harbor" protecting against publicly traded partnership treatment. Accordingly, Liberty will only permit units to be transferred pursuant to the Offer if the general partner determines, in its sole discretion, either that the cumulative total number of transfers in any tax year (including transfers prior to the Offer, transfers pursuant to the Offer and any amount reserved for future transfers outside of the Offer) falls within the safe harbor or that the Offeror has provided sufficient assurances and protection to Liberty, its partners and unit holders to allow the transfers even though the aggregate annual transfers of Liberty units may exceed the two percent safe harbor limitation. Such sufficient assurances and protection by the Offeror would include providing Liberty with (i) an opinion of counsel that the Offer will not result in Liberty being deemed to be a "publicly traded partnership" for federal income tax purposes and (ii) an agreement to indemnify Liberty, its partners and its unit holders for any loss or liability relating to any adverse tax consequences arising from the Offer. This legal opinion and indemnity must be in a form and content satisfactory to Liberty and its counsel. Second, the Offering Materials state that the Offeror will not purchase more than 4.9% of Liberty's outstanding units, including in that 4.9% amount the units already owned by the Offeror. The Offering Materials, however, do not state how many units the Offeror already owns, so it is impossible to determine from those materials how many units the Offeror is willing to purchase. Third, unit holders are reminded that any unit holder wishing to sell his, her or its units must complete Liberty's standard transfer and subscription documentation in accordance with Liberty's standard practices and procedures. Among other things, each selling unit holder must individually sign each of Liberty's required transfer documents. Pursuant to Liberty's well- established practices and procedures, Liberty does not accept, and will not accept in connection with the Offer, signatures by persons other than the selling unit holder who purport to act based on a power of attorney executed by the unit holder. Liberty also charges a standard $50 administrative fee for processing each transfer request. Persons who wish to sell their units to the Offeror should so advise the Offeror, which will obtain from Liberty, and deliver to the selling unit holder, the required standard transfer documentation. About Liberty Tax Headquartered in New York City, Liberty Tax Credit Plus III L.P. is a limited partnership, which was formed under the laws of the State of Delaware on Nov. 17, 1988. Liberty Tax Credit Plus III L.P. invests in other limited partnerships, each of which owns one or more leveraged low- and moderate-income multifamily residential complexes that are eligible for the low-income housing tax credit enacted in the Tax Reform Act of 1986, and to a lesser extent, in local partnerships owning properties that are eligible for the historic rehabilitation tax credit. Liberty Tax Credit's general partners are Related Credit Properties III L.P., a Delaware limited partnership, and Liberty GP III Inc., a Delaware corporation. Liberty Tax Credit Plus III L.P.'s consolidated balance sheet at Dec. 31, 2007, showed $67.8 million in total assets, $77.6 million in total liabilities, and $778,430 in minority interest, resulting in a $10.5 million total stockholders' deficit. LIQUIDATION WORLD: Weighing Strategic Options to Increase Value --------------------------------------------------------------- Liquidation World Inc., (TSX:LQW) formed a Special Committee of independent board members to investigate and evaluate strategic alternatives available to the Company to increase shareholder value. The Special Committee is comprised of independent board members Craig Graham, Chairman, Jeffrey Mandel, and Bob Wiens, CA. The Special Committee has retained Capital West Partners, an independent financial advisor, to assist in the process and has also retained independent legal counsel. At present, the Special Committee has not established a list of strategic alternatives, nor has it endorsed any particular course of action. Furthermore, there is no guarantee that the work of the Special Committee will lead to any transaction. Liquidation World also announced that Darryl Chenoweth, SVP Operations, will leave the Company effective June 6, 2008. The Company will make use of existing personnel and resources to ensure a smooth transition of responsibilities within Operations group while further improving overhead costs. According to CBC.ca, Liquidation World lost $5 million on revenues of $42.2 million in the second quarter of its current financial year. In the same quarter of last year, the company lost $3 million on revenue of $42 million. The report also mentions that in August, the company announced a plan to stem losses by closing 16 of its 18 money-losing U.S. stores and turning the other two into distribution centres. The company's shares, trading at the $5 level a year ago, closed Tuesday at $1.56. About Liquidation World Liquidation World -- http://www.liquidationworld.com-- liquidates consumer merchandise through 106 stores in Canada and the United States. The Company solves asset recovery problems in a professional manner for the financial services industry, insurance companies, manufacturers, wholesalers and other organizations. Liquidation World is based in Brantford, Ontario and maintains a number of regional buying offices in Canada and the United States. The Company opened its first store in Calgary, Alberta in 1986 and today, with more than 1,600 employees, is Canada's largest liquidator. LLOYD HUNTER: Case Summary & 4 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Lloyd Douglas Hunter Mamie Elizabeth Hunter 853 Cypress Creek Road Wallace, NC 28466 Bankruptcy Case No.: 08-03525 Chapter 11 Petition Date: May 23, 2008 Court: Eastern District of North Carolina (Wilson) Judge: Hon. J. Rich Leonard Debtor's Counsel: Trawick H Stubbs, Jr. (efile@stubbsperdue.com) Stubbs & Perdue, P.A. P. O. Drawer 1654 New Bern, NC 28563 Telephone (252) 633-2700 Fax (252) 633-9600 Estimated Assets: $1,000,001 to $10 million Estimated Debts: $1,000,001 to $10 million A copy of the debtors' petition is available for free at: http://bankrupt.com/misc/nceb08-03525.pdf LONEWA BAPTIST: Voluntary Chapter 11 Case Summary ------------------------------------------------- Debtor: Lonewa Baptist Church, Inc. dba Lonewa Missionary Baptist Church 3717 Harvester Drive Monroe, LA 71202 Telephone (318) 322-5700 Bankruptcy Case No.: 08-30802 Type of Business: The debtor leads a sectarian organization. Chapter 11 Petition Date: May 12, 2008 Court: Western District of Louisiana (Monroe) Judge: Hon. Henley A. Hunter Debtor's Counsel: Rex D. Rainach (rainach@msn.com) 3622 Government St. Baton Rouge, LA 70806 Telephone (225) 343-0643 Fax (225) 343-0646 Estimated Assets: $1,000,001 to $ 10 million Estimated Debts: $1,000,001 to $ 10 million The Debtor did not file a list of its largest unsecured creditors. LUBBOCK MEDICAL: Investor Group to Announce Buyout Plans Today -------------------------------------------------------------- Lubbock, Texas-Highland Medical Center, L.P., doing business as Highland Community Hospital and Highland Medical Center, is under negotiations with a group led by businessman Wayne Collins for the sale of the healthcare facility's operations, Chris Van Wagenen at Lubbock Avalanche-Journal reports. Mr. Collins plans to discuss his group's acquisition plans at a news conference at the hospital at 2 p.m. Monday, Lubbock Avalanche-Journal says. According to Mr. Van Wagenen, Highland Community Hospital appeared before the U.S. Bankruptcy Court for the Northern District of Texas on Friday to assure the Court it had access to cash to continue day-to-day operations when a possible buyer emerged. According to Mr. Van Wagenen, Mr. Collins said "We're working with quite a few local physicians and other investors who are interested in buying the hospital. . . . If we're successful, we plan to reorganize it and set it up a different way." Mr. Collins said the hospital operator was "just undercapitalized." The Troubled Company Reporter said on June 5, 2008, that Shiloh Health Services Inc. in Louisville, Ky., the owner of Highland Community Hospital, may sell the business. Shiloh is a hospital management company formed in 2005. It serves as the general partner for Highland, according to Lubbock Avalanche-Journal. Shiloh bought the 123-bed facility as its base of operations in March 2006 from Community Health Systems, which had operated the property for 20 years, the report adds. Lubbock, Texas-Highland Medical Center, L.P., doing business as Highland Community Hospital and Highland Medical Center -- http://www.highlandcommunityhospital.com-- provides general medical and surgical care for inpatient, outpatient, and emergency room patients, and participates in the Medicare and Medicaid programs. Highland employs about 100 workers. The Debtor filed for chapter 11 bankruptcy protection on May 31, 2008, before the U.S. Bankruptcy Court for the Northern District of Texas (Case No. 08-50202). Max Ralph Tarbox, Esq., at McWhorter, Cobb & Johnson, LLP, in Lubbock, Texas, represents the Debtor. When it filed for bankruptcy, the Debtor disclosed $10 million to $50 million in estimated assets and debts. LUBBOCK MEDICAL: Gets Okay to Use Cash Collateral Until June 18 --------------------------------------------------------------- Lubbock, Texas-Highland Medical Center, L.P., doing business as Highland Community Hospital and Highland Medical Center, sought and obtained authority from the U.S. Bankruptcy Court for the Northern District of Texas to use the cash collateral of its prepetition secured lenders on an interim basis until June 18, 2008, Chris Van Wagenen at Lubbock Avalanche-Journal reports. The Debtor will use the money to fund business operations and bankruptcy costs as it seeks to sell its assets. Highland Community Hospital is under negotiations with a group led by businessman Wayne Collins for the sale of the healthcare facility's operations, according to Mr. Van Wagenen. The group is scheduled to discuss its acquisition plans at a news conference at the hospital at 2 p.m. Monday, the report says. Max Ralph Tarbox, Esq., the Debtor's counsel, said Highland now has access to its cash receivables, the report adds. According to Mr. Tarbox, creditors holding liens on the Debtor's property did not contest the move, the report says. Lubbock Avalanche-Journal, citing Danny Soliz, director of business services for WorkForce Solutions, relates that Highland laid off six full-time employees and about seven part-timers as a result of its financial woes. Mr. Soliz, according to the report, said WorkForce was prepared to assist any displaced workers. Highland's been informed of this, Mr. Soliz said. Lubbock, Texas-Highland Medical Center, L.P., doing business as Highland Community Hospital and Highland Medical Center -- http://www.highlandcommunityhospital.com-- provides general medical and surgical care for inpatient, outpatient, and emergency room patients, and participates in the Medicare and Medicaid programs. Highland employs about 100 workers. Highland Community Hospital is owned by Shiloh Health Services Inc., a Louisville, Ky.-based hospital management company formed in 2005. It serves as the general partner for Highland. Shiloh bought the 123-bed facility as its base of operations in March 2006 from Community Health Systems, which had operated the property for 20 years, Lubbock Avalanche-Journal says. The Debtor filed for chapter 11 bankruptcy protection on May 31, 2008, before the U.S. Bankruptcy Court for the Northern District of Texas (Case No. 08-50202). Max Ralph Tarbox, Esq., at McWhorter, Cobb & Johnson, LLP, in Lubbock, Texas, represents the Debtor. When it filed for bankruptcy, the Debtor disclosed $10 million to $50 million in estimated assets and debts. MAHONING COUNTY: S&P Lowers Bond Rating to B+ from BB ----------------------------------------------------- Standard & Poor's Ratings Services lowered its rating on Mahoning County, Ohio bonds, issued for Forum Health, to 'B+' from 'BB'. The outlook remains negative. The 'B+' rating reflects Forum Health's weak balance sheet characteristics, with increasing leverage due to unrestricted net assets erosion and a weaker liquidity level. Forum had to fund the debt service reserve account in fiscal 2007, which totaled about $13.5 million for both fiscals 2007 and 2006, because of covenant violations and an amendment to the master forbearance agreement, requiring renegotiation of forbearance agreements with credit providers as they mature in May 2008. In addition, Forum faces challenging collective bargaining negotiations, which are critical to the sustained success of Forum Health's turnaround program. However, Forum has amicably negotiated the American Federation of State County and Municipal Employees contract and is currently renegotiating the two larger contracts with Service Employees International Union and the Ohio Nurses Assoc., with whom Forum has short-term contracts that are set to expire in 2008. The departure of physicians from Forum has had a negative effect on volume at Northside Medical Center. The overall level of competition in the service area and growing competition in its Southern Mahoning market, affects inpatient and outpatient volume, particularly at Western Reserve Care System. In addition, demographic changes require future repositioning of WRCS in the market. Deferment of capital projects primarily at WRCS also could hamper Forum's competitive position. "While Forum Health improved operationally during its 2007 fiscal year, our rating outlook is negative, given uncertainty about the sustainability of the turnaround plan because of year-to-date losses and the union contract negotiations, as well as the required forbearance extensions from the credit providers beyond May 23, 2008, increased competition that affecting volume, and a decline in cash balances," said Standard & Poor's credit analyst Antionette Maxwell. "Given these hurdles, we view this as a critical time for Forum's financial profile, and the stabilization of the organization will more than likely be realized in the distant future; therefore, there is potential for a lower rating," concluded Ms. Maxwell. A lower rating is precluded at this time due to Forum's improved operating results for the unaudited fiscal year ended Dec. 31, 2007. Additionally, Forum is looking to divest other nonperforming assets in the near future, which could bolster balance sheet strength. During the turnaround phase, Forum's management team completely turned over and it now has a permanent chief financial officer who has been with the organization for five years. MAJESKY AUTOMOTIVE: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: Majesky Automotive Group, Inc. 5355 Miller Circle Drive Matteson, IL 60443 Bankruptcy Case No.: 08-11580 Type of Business: The debtor operates a car dealership business. Chapter 11 Petition Date: May 7, 2008 Court: Northern District of Illinois (Chicago) Judge: Hon. Carol A. Doyle Debtor's Counsel: Abraham Brustein, Esq. (abrustein@dimonteandlizak.com) Dimonte & Lizak, LLC 216 W. Higgins Road Park Ridge, IL 60068 Telephone (847) 698-9600 Ext. 221 Fax (847) 698-9623 Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10 million A copy of debtor's petition is available for free at: http://bankrupt.com/misc/ilnb08-11580.pdf MBIA INSURANCE: S&P Chips 10 Ratings to AA; Puts Under Neg. Watch ----------------------------------------------------------------- Standard & Poor's Ratings Services lowered its standard long-term ratings on 10 MBIA Insurance Corp.-backed issues to 'AA' from 'AAA' and placed them on CreditWatch with negative implications. These actions follow Standard & Poor's downgrade of MBIA Insurance Corp. to 'AA' from 'AAA' and placement on CreditWatch with negative implications. All of the issues receive partial support in the form of guaranteed investment contracts or investment agreements from MBIA Insurance Corp. Standard & Poor's examined all local housing bond issues with partial credit support from MBIA, taking several factors into consideration. Some issues are not affected because their current ratings can still be supported by credit supports from MBIA, and other factors. For local issuers, which represent the majority of the affected ratings, Standard & Poor's looked at the reliance upon the insurer's credit support. The CreditWatch placements reflect the issue's reliance upon return of principal and investment earnings to meet bond payment obligations. Issue Description Clearfield, UT, FHA Insured Multifamily Housing Revenue Bonds (Oakstone Apts Project), series 1997A&B * Connecticut Health & Educational Facilities Authority FHA Insured Mortgage Revenue Bonds (Hebrew Home And Hosp), series 1999B * Denver City & County, CO, Multifamily Housing Revenue Bonds (FHA Insured Mortgage Loan - Boston Lofts Project), series 1997A&B * Natrona County, WY, Ginnie Mae Collateralized Health Facilities Improvement & Refunding Bonds (Luthercare, Inc. Project), series 1997 * New York State Dormitory Authority FHA Insured Mortgage Hospital Bonds (Kaleida Health), series 2006 * New York State Dormitory Authority FHA Insured Mortgage Revenue Bonds (Hebrew Hospital Home), series 1996 * San Jose, CA, Multifamily Housing Revenue Bonds (Sixth & Martha Family Apts - Phase II), series 2001C * San Jose, CA, Multifamily Housing Revenue Bonds (Village Parkway Senior Apts), series 2001D * University City Industrial Development Authority, MO, Mortgage Revenue Bonds (Cantebury Gardens), series 1995A * Utah Housing Corp. Multifamily Housing Revenue Bonds (The Ridge At Jordan Landing Apt Project), series 1999A&B MCGEEHAN CONSTRUCTION: Voluntary Chapter 11 Case Summary -------------------------------------------------------- Debtor: McGeehan Construction, Inc. 12990 - 34th Street North Clearwater, FL 33762 Bankruptcy Case No.: 08-08132 Chapter 11 Petition Date: June 4, 2008 Court: Middle District of Florida (Tampa) Debtors' Counsel: Buddy D. Ford, Esq. 115 N. MacDill Avenue Tampa, FL 33609-1521 Tel: (813) 877-4669 Fax: (813) 877-5543 Buddy@tampaesq.com Estimated assets: $0 to $50,000 Estimated debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its 20 largest unsecured creditors. MEDIACOM COMMS: Units Ink New $350 Million Term Loan Agreement -------------------------------------------------------------- Mediacom Communications Corporation owns cable systems through two principal subsidiaries, Mediacom LLC and Mediacom Broadband LLC. The operating subsidiaries of Mediacom Broadband have a bank credit facility that consists of a revolving credit commitment and two term loans. On May 29, 2008, the operating subsidiaries of Mediacom Broadband entered into an incremental facility agreement that provides for a new term loan under the Broadband credit facility in the principal amount of $350.0 million. On May 29, 2008, the full amount of the $350.0 million new term loan was borrowed by the operating subsidiaries of Mediacom Broadband. Borrowings under the new term loan bear interest at a floating rate or rates equal to, at the option of the operating subsidiaries of Mediacom Broadband, the LIBOR rate or the prime rate, plus a margin of 3.50% for LIBOR rate loans and a margin of 2.50% for prime rate loans. For the first four years of the new term loan, the LIBOR rate and the prime rate applicable to the new term loan are subject to a minimum of 3.00% in the case of the LIBOR rate and a minimum of 4.00% in the case of the prime rate. The new term loan matures on Jan. 3, 2016. The obligations of the operating subsidiaries under the new term loan are governed by the terms of the Broadband credit facility. Approximately $335.0 million of the proceeds from the new term loan were used to repay the outstanding balance of the revolving credit portion of the Broadband credit facility, without any reduction in the revolving credit commitments. The balance of the proceeds from the new term loan will be used for general corporate purposes. Based in Middletown, New York, Mediacom Communications Corporation (Nasdaq: MCCC) -- http://www.mediacomcc.com/-- is a cable television company focused on serving the smaller cities and towns in the United States. The company offers a wide array of broadband products and services, including traditional video services, digital television, video-on-demand, digital video recorders, high-definition television, high-speed Internet access and phone service. At March 31, 2008, the company's consolidated balance sheet showed $3.6 billion in total assets and $3.9 billion in total liabilities, resulting in a $295.8 million total stockholders' deficit. * * * As disclosed in the Troubled Company Reporter on June 3, 2008, Fitch Ratings has affirmed the 'B' Issuer Default Rating for Mediacom Communications Corporation and its wholly owned subsidiaries Mediacom LLC and Mediacom Broadband LLC. In addition Fitch has assigned a 'BB/RR1' rating to Mediacom Broadband LLC's $300 million incremental term loan E. Lastly, Fitch has upgraded Mediacom LLC's senior unsecured debt to 'B-/RR5' from 'CCC+/RR6'. Approximately $3.2 billion of debt as of March 31, 2008 is affected. The Rating Outlook for all of Mediacom's ratings is Stable. As reported in the Troubled Company Reporter on March 6, 2008, Moody's Investors Service affirmed its 'B1' corporate family rating for Mediacom Communications Corp.. The rating outlook remains stable. MOSHE KIPERSZTOK: Voluntary Chapter 11 Case Summary --------------------------------------------------- Debtor: Moshe Kipersztok 5405 Lakemont Boulevard SE, Suite 434 Bellevue, WA 98006 Bankruptcy Case No.: 08-13475 Chapter 11 Petition Date: June 5, 2008 Court: Western District of Washington (Seattle) Debtor's Counsel: Michael P. Harris, Esq. Attorney at Law 2125 5th Avenue Seattle, WA 98121 Tel: (206) 622-7434 mph4@quidnunc.net Estimated Assets: Less than $50,000 Estimated Debts: $1 million to $10 million The Debtor did not file a list of its 20 Largest Unsecured Creditors. LUNA HEALTH: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Luna Health Management, Inc. 28501 Orchard Lake Rd #120 Farmington Hills, MI 48334 Bankruptcy Case No.: 08-51067 Chapter 11 Petition Date: May 6, 2008 Court: Eastern District of Michigan (Detroit) Judge: Marci B. McIvor Debtor's Counsel: Robert N. Bassel 201 W. Big Beaver, 6th Floor Troy, MI 48099 Tel: (248) 528-1111 E-mail: robert.bassel@kkue.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 Entity Claim Amount ------ ------------ AMO Sales & Service Inc. 784,739 Contact: Pamela Brooks Tel: 949-862-3854 Univision 242,472 6006 S. 30th St. Phoenix, AX 85042 Allergan Sales LLC 187,000 12975 Collections Center Dr. Chicago, IL 60693 Clear Channel 111,382 Detroit Newspaper 103,650 KTNV 101,950 SCW Agcy Group 82,760 Cox Media 80,610 AT&T Yellow Pages.com 69,126 Bausch & Lomb 68,326 Corton-Glenn Advertising 55,655 WPGH 45,096 Mentor Corporation 42,382 Mentor 42,382 CBS Radio 38,213 KREM-TV 35,274 Physician Sales & Services 34,164 Law Firm of Yaldo & Domstein, PLLC 27,000 Wachler & Associates 22,481 WNWO 19,206 MERRILL LYNCH MORTGAGE: S&P Junks Rating on Class G Certificates ---------------------------------------------------------------- Standard & Poor's Ratings Services lowered its rating on the class G commercial mortgage pass-through certificates from Merrill Lynch Mortgage Investors Inc.'s series 1999-C1 to 'CCC-' from 'B'. Concurrently, S&P affirmed its ratings on seven additional classes from this series. The downgrade reflects accumulated interest shortfalls of $708,349 and anticipated credit support erosion upon the eventual resolution of the specially serviced assets. It is unclear when the shortfalls will be recovered, and if they continue, S&P will lower the rating on class G to 'D'. The affirmed ratings reflect credit enhancement levels that provide adequate support through various stress scenarios. Several of the affirmed ratings are constrained by liquidity concerns surrounding trust litigation. As of the May 15, 2008, remittance report, the collateral pool consisted of 82 loans with an aggregate trust balance of $408.3 million, compared with 106 loans totaling $592.4 million at issuance. The master servicer, KeyBank Real Estate Capital, reported financial information for 97% of the nondefeased loans. Eighty-three percent of the servicer-provided information was full-year 2007 data. Using this information, Standard & Poor's calculated a weighted average debt service coverage of 1.49x. There are three assets with the special servicer, ORIX Capital Markets LLC, with total appraisal reduction amounts of $11.2 million in effect. To date, the trust has experienced six losses totaling $13.7 million. The top 10 exposures secured by real estate have an aggregate outstanding balance of $134.7 million (33%) and a weighted average DSC of 1.64x. This calculation excludes the former third- and fourth-largest assets, which are with the special servicer. Standard & Poor's reviewed property inspections provided by the master servicer for 10 of the assets underlying the top 11 exposures. One property was characterized as "excellent," and the remaining collateral was characterized as "good." The First American Building is the largest loan with the special servicer and the third-largest loan in the pool, with a total exposure of $15.9 million. The loan was transferred to the special servicer on June 6, 2005, due to imminent default after the sole tenant indicated that it would exercise an early lease termination option in July 2007. The loan has been modified so it is now fully recourse to the guarantor, and the loan remains current. The Frazier-King Building is the only real estate owned asset and the fourth-largest exposure in the pool, with a total exposure of $21.3 million including servicing advances as well as interest thereon. The loan was transferred to the special servicer on Jan. 30, 2003, due to imminent default and became REO on April 8, 2005. Standard & Poor's expects a significant loss upon the liquidation of the asset. The Arlington Apartments asset has a total exposure of approximately $11.2 million, including principal and collection expenses. The trust is involved in litigation to collect on a $14.5 million judgment from the borrowers/guarantors. The trial is scheduled to begin in October 2008, and ORIX expects significant additional legal expenses in relation to the upcoming trial. Uncertainty surrounding the outcome of the litigation and the timing of the recovery continues to constrain several ratings on this transaction. There are 20 loans on the servicer's watchlist totaling $67.5 million (16.5%), including two of the top 10 exposures in the pool. Details for these two exposures are: -- The Tanglewood Apartments loan is the fifth-largest loan in the pool and has an outstanding balance of $14.4 million (4%). The loan is secured by a 408-unit multifamily property in Hammond, Indiana. The loan appears on the watchlist because the property reported a year-end 2007 DSC of 1.01x. -- The Lamda Building is the ninth-largest exposure in the pool and has an outstanding balance of $8.5 million (2%). The loan is secured by a 194,000-sq.-ft. industrial property in Melville, N.Y. The loan appears on the watchlist because the property reported a year-end 2007 occupancy of 75%, down from 100% at issuance. Nine loans ($32.0 million, 7.8%) have reported DSCs of less than 1.0x. These loans are on the watchlist primarily because of low occupancies or declines in DSC since issuance. Standard & Poor's stressed the loans on the watchlist and the other loans with credit issues as part of its analysis. The resultant credit enhancement levels support the lowered and affirmed ratings. Rating Lowered Merrill Lynch Mortgage Investors Commercial mortgage pass-through certificates series 1999-C1 Rating ------ Class To From Credit enhancement ----- -- ---- ------------------ G CCC- B 5.71% Ratings Affirmed Merrill Lynch Mortgage Investors Commercial mortgage pass-through certificates series 1999-C1 Class Rating Credit enhancement ----- ------ ------------------ A-2 AAA 35.09% B AAA 27.11% C AA+ 20.58% D AA 18.41% E BBB+ 13.33% F BB+ 11.51% IO AAA N/A N/A -- Not applicable. MIRABILIS VENTURES: Case Summary & 23 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: Mirabilis Ventures, Inc. 3660 Maguire Blvd., Ste. 103 Orlando, FL 32803 Bankruptcy Case No.: 08-04327 Debtor-affiliate filing a separate Chapter 11 petition on June 5, 2008: Entity Case No. ------ -------- AEM, Inc. 08-04681 Debtor-affiliate filing a separate Chapter 11 petition: Entity Case No. ------ -------- Hoth Holdings, LLC 08-04328 Chapter 11 Petition Date: May 27, 2008 Court: Middle District of Florida (Orlando) Debtor's Counsel: Elizabeth A. Green, Esq. E-mail: bankruptcynotice@lseblaw.com Latham Shuker Eden & Beaudine, LLP 390 North Orange Ave., Ste. 600 Orlando, FL 32801 Tel: (407) 481-5800 Fax: (407) 481-5801 http://www.lseblaw.com Mirabilis Ventures, Inc's Financial Condition: Estimated Assets: $50 million to $100 million Estimated Debts: $50 million to $100 million A. Mirabilis Ventures, Inc's 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ First Commercial Ins. Corp. workers comp. carrier $8,400,000 7900 N.W. 155th St., Ste. 201 Miami Lakes, FL 33016 Kenneth & Diane Hendricks suit pending $2,847,196 One ABC Parkway Beloit, WI 53511 John Burcham suit pending $2,536,557 3415/A Bahia Drive Ft. Lauderdale, FL 33316 American Express $247,932 Saxon Gilmore, PA legal fees $153,281 Tenshi Leasing $82,655 PaySource USA VII, Inc. $76,928 Brandywine Grande C., LP utilities due under $60,758 lease agreement in Richmond, VA order for judgment entered against MVI, suit was not properly served Titanium Technologies $55,363 Buchanan Ingersoll & Rodney legal fees $43,547 Fred Sandlin $25,000 On Target Solutions accounting IT $22,655 LeClair Ryan Trust real estate closings $18,275 Jackson Lewis PEO attorney $9,962 LexisNexis on-line research $4,496 Advantage Collection Prof. business cards $3,290 Humana/RMS health insurance $2,852 premiums Horton Johnson expense reimbursement $2,407 Mak J. Bernet $1,751 BNA Tax Management online tax softward $1,267 B. Hoth Holdings, LLC's Three Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Coastal Equity Partners alleged breach unknown Attn: Moreco Partners, Manager of contract 350 Camino Gardens Blvd., Ste. 102 Boca Raton, FL 33432 Commonwealth of Virginia 2006-2007 taxes $19,883 Attn: M. Erickson, Rev. Coll. City of Henrico-DOF/Treasury P.O. Box 27032 Richmond, VA 23273-7032 United States of America real property unknown Attn: Nicole M. Andrejko, Esq. U.S. Attorney's Office FLM 501 W. Church St., Ste. 300 Orlando, FL 32805 C. AEM, Inc. did not file a list of its largest unsecured creditors. NATIONAL CITY: Agreement with OCC Confirms Federal Probation ------------------------------------------------------------ National City Corp.'s banking unit has entered into a "memorandum of understanding" with federal regulators, effectively putting the bank on probation, The Wall Street Journal reports. According to WSJ, the confidential agreement with the Office of the Comptroller of the Currency was entered into over the past month or so. It illustrates the growing regulatory pressure some financial institutions are under as they struggle to deal with fallout from the credit-market turmoil, WSJ relates. The OCC is a division of the Treasury Department that regulates national banks. WSJ says that the terms of the agreement with National City aren't disclosed, however, regulators usually urge banks to maintain adequate capital and improve lending standards. Moves to Restructure According to WSJ, National City has been severely contracting its mortgage and home-equity lending, laying off hundreds of employees in the process. The company sold subprime lender First Franklin Financial Corp. in 2006 to Merrill Lynch & Co. and quit using outside mortgage lenders in 2007, WSJ states. The company has also drastically tightened lending standards, curtailing originations of even the most traditional loans, WSJ says. The MOU would effectively cement those changes, WSJ relates. WSJ says that the bad bets have taken a toll on the bank's bottom line, it slashed its dividend by 95% to a penny a share, and its shares have fallen 85% from a year ago. Banks and MOU WSJ points out that National City isn't alone in operating under a memorandum of understanding. Regulators, hoping to fend off a wave of bank failures, have been pushing lenders to raise more capital, curtail their growth, and improve their risk-management and underwriting practices, WSJ states. Banking experts, WSJ says, estimate that a handful of mid-size banks have entered MOUs. The MOUs are agreements between regulators and bank management. WSJ indicates that under the agreements, banks are given an opportunity to work with federal regulators to address serious financial problems without triggering alarm among depositors. They are considered serious and are fairly rare, though it is even less common for a bank to face a public enforcement action, WSJ relates. If a bank receives a non-public enforcement action and then resolves all of the issues in a timely manner, regulators would likely never disclose the sanction publicly, WSJ says. WSJ points out that if a bank fails to comply with an informal enforcement action, regulators can bring more-severe penalties -- often publicly -- to clamp down on a company's management or operations. About National City Corporation Headqurtered in Cleveland, Ohio, National City Corporation -- http://www.nationalcity.com/-- is financial holding company that operates through an extensive distribution network in Ohio, Florida, Illinois, Indiana, Kentucky, Michigan, Missouri, Pennsylvania, and Wisconsin, and also conducts selected lending and other financial services businesses on a nationwide basis. The primary source of National City's revenue is net interest income from loans and deposits, revenue from loan sales and servicing, and fees from financial services provided to customers. Its operations are primarily conducted through more than 1,400 branch banking offices located within National City's nine-state footprint. In addition, National City operates over 410 retail mortgage offices throughout the United States. At year ended December 31, 2007, National City reported total assets of $143.559 billion, total liabilities of $130.359 billion and total stockholders' equity of $13.200 billion. It posted a loss of $333 million in the fourth quarter. Pressure to Increase Capital As reported in the Troubled Company Reporter on April 11, 2008, National City is under regulatory pressure to increase its capital or find a buyer. The company has seen its market value plunge to about $5 billion, the report said. In an April 1 statement, National City disclosed that its board of directors is reviewing a range of strategic alternatives for the company. It has retained Goldman Sachs as advisor for the review. NATIONAL POWER: Texas Electricity Retailers Close After Default --------------------------------------------------------------- Three electricity retailers in Texas have stopped serving customers, Elizabeth Souder of The Dallas Morning News reports. Etricity, also known as HWY 3 MHP LLC, Pre-Buy Electric LLC and National Power Co. have stopped serving customers after defaulting on payment to the Electric Reliability Council of Texas, which operates the power grid. ERCOT is now switching Etricity's 12,222 customers to other providers, known as providers of last resort, and is nearly finished switching the 23,593 customers of Pre-Buy and National Power. According to the report, electricity companies typically charge higher prices for default service, based on the average price of power in the wholesale spot market. And those prices have spiked in recent weeks as high temperatures boost demand for power, causing congestion on some transmission lines. Industry insiders say more defaults are on the way as wholesale power prices rise, according to the Dallas Morning News. Etricity is based in Denton. Based in Dr. Grapevine is owned by Criag Bolin. It was started in 2005. it has $130,000 in estimated annual sales, according to Manta (http://www.manta.com/). National Power, headquartered in Houston, was started in 2007. Its president is Denise Fields. It has 15 employees. NEOMAGIC CORP: Has Until December 1 to Comply with Nasdaq Criteria ------------------------------------------------------------------ NeoMagic Corporation received notice from The NASDAQ Stock Market stating that for 30 consecutive business days the company's common stock has closed below the minimum $1 per share requirement for continued inclusion under Marketplace Rule 4310(c)(4). The notice has no effect on the listing of the company's securities at this time, and its common stock will continue to trade on the NASDAQ Global Market under the symbol "NMGC." In accordance with Marketplace Rule 4310(c)(8)(D), the company has 180 calendar days, or until Dec. 1, 2008, to regain compliance. The notice states that if, at any time before Dec. 1, 2008, the bid price of the company's common stock closes at $1 per share or more for a minimum of 10 consecutive business days, and the company continues to satisfy the NASDAQ initial listing criteria as set forth in Marketplace Rule 4310(c), the NASDAQ staff will provide written notification that the company has achieved compliance with the minimum bid price requirement. No assurance can be given that the company will regain compliance during that period. If the company does not regain compliance with the minimum bid price requirement by Dec. 1, 2008, the NASDAQ staff will determine whether the company satisfies the NASDAQ initial listing criteria, except for the bid price requirement. If it meets the initial listing criteria, the NASDAQ staff will notify the company that it has been granted an additional 180 calendar day compliance period. If the company is not eligible for an additional compliance period, the NASDAQ staff will provide written notification that the company's securities will be delisted. At that time, the company may appeal the delisting determination to a Listings Qualifications Panel. No assurance can be given that the company will be eligible for the additional 180-day compliance period, or, if applicable, that it will regain compliance during any additional compliance period. The company has not yet determined what action, if any, it will take in response to this notice. However, the company intends to monitor the closing bid price of its common stock between now and Dec. 1, 2008, and to consider available options if its common stock does not trade at a level likely to result in the company regaining compliance with the NASDAQ minimum closing bid price requirement. About NeoMagic Corporation Headquartered in Santa Clara, California, NeoMagic Corporation (Nasdaq: NMGC) -- http://www.neomagic.com/-- delivers semiconductor chips and software that enable new multimedia features for handheld devices. These solutions offer low power consumption, small form-factor and high performance processing. Going Concern Doubt On April 23, 2008, Stonefield Josephson Inc. in San Francisco, California, expressed substantial doubt about NeoMagic Corporation's ability to continue as a going concern after auditing the company and its subsidiaries' financial statements for fiscal year ended Jan. 27, 2008, and Jan. 28, 2007. The auditors pointed that the company has suffered recurring losses from operations and negative cash flows. The company also related that it needed to raise additional capital to fund future operating activities. If the company experiences a material shortfall versus its plan, it expects to take appropriate actions to maximize the value of the company. The company also believes that it can take actions to generate cash by selling or licensing intellectual property, seeking funding from strategic partners, and seeking further equity or debt financing from financial sources. NETWURX INC: Case Summary & 60 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Netwurx, Inc. 35 E. Sumner Street P.O. Box 270020 Hartford, Wisconsin 53027 Tel: (800) 638-9879 Bankruptcy Case No.: 08-26131 Type of Business: The Debtor provides Internet services. It is owned by Pete and Pamela Maher. See: http://www.netwurxinc.com/ Chapter 11 Petition Date: June 5, 2008 Court: Eastern District of Wisconsin (Milwaukee) Judge: Susan V. Kelley Debtors' Counsel: Guy K. Fish, Esq. (gfish@charterinternet.com) Fish Law Offices 533 Vernal Avenue Milton, Wisconsin 53563 Tel: (608) 868-3200 Fax: (608) 868-3208 Estimated Assets: $50,000 to $1 million Estimated Debts: $1 million to $10 million A copy of the Debtor's petition is available for free at: http://bankrupt.com/misc/wiseb08-26131.pdf NORTHPOINT VILLAGE: Case Summary & 4 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Northpoint Village of Utica, LLC 50258 Van Dyke, Ste. B Utica, MI 48317 Bankruptcy Case No.: 08-53097 Chapter 11 Petition Date: May 29, 2008 Court: Eastern District of Michigan (Detroit) Judge: Walter Shapero Debtors' Counsel: Gerald L. Decker, Esq., 42700 Schoenherr Rd., Suite 3 Sterling Heights, MI 48313 Tel: (586) 532-1122 E-mail: gldeckerlaw@aol.com Total assets: $15,000,000 Total debts: $11,068,424 Debtor's four largest unsecured creditors: Entity Amount ------ ------ Flagstar Bank $10,238,701 5151 Corporate Drive Troy, MI 48098 Mike Genson Mechanical, LLC $740,087 182 E. Livingston Road Highland, MI 48357 City of Utica $87,635 Attn: Treasurer 7550 Auburn Road Utica, MI 48317 Arthur A. Garton $2,000 38550 Garfield Road, Ste. A Clinton Township, MI 48317 OAKS GROUP: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------- Debtor: The Oaks Group, Inc. 11900 Biscayne Boulevard, Suite 288 Miami, FL 33314 Bankruptcy Case No.: 08-17468 Chapter 11 Petition Date: June 4, 2008 Court: Southern District of Florida (Fort Lauderdale) Judge: John K. Olson Debtor's Counsel: Jordi Guso, Esq. Berger Singerman, PA 200 S. Biscayne Boulevard, #1000 Miami, FL 33131 Tel: (305) 755-9500 Fax: (305) 714-4340 Estimated Assets: $1 million to $10 million Estimated Debts: $10 million to $50 million A copy of the Debtor's list of 20 largest unsecured creditors is available for free at http://bankrupt.com/misc/flsb08-17468.pdf OTAY VALLEY: Case Summary & 6 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Otay Valley Trailands, LLC 1196 4th Avenue Chula Vista, CA 91911 Bankruptcy Case No.: 08-03862 Chapter 11 Petition Date: May 7, 2008 Court: Southern District of California (San Diego) Judge: Louise DeCarl Adler Debtors' Counsel: Joseph N. Casas, Esq. 2323 Broadway, Ste. 202 San Diego, CA 92102 Tel: (619) 692-3146 Estimated Assets: $1 million to $10 million Estimated Debts: $1 million to $10 million A list of the Debtor's six largest unsecured creditors is available for free at: http://bankrupt.com/misc/casb08-03862.pdf PACIFIC FIRST: Case Summary & 2 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: PACIFIC FIRST REDLANDS, LLC 7226 Sepulveda Blvd Suite 200 Van Nuys, CA 91405 Bankruptcy Case No.: 08-13170 Chapter 11 Petition Date: May 15, 2008 Court: Central District of California (San Fernando Valley) Judge: Kathleen Thompson Debtors' Counsel: Damon G. Saltzburg, Esq. 12121 Wilshire Blvd Suite 600 Los Angeles, CA 90025-1166 Tel: (310) 481-6700 Fax: (310) 481-6720 E-mail: ds@srblaw.com Estimated Assets: $1 million to $10 million Estimated Debts: $1 million to $10 million Debtor's two largest unsecured creditors: Entity Nature of Claim Amount ------ --------------- ------ Hall & Foreman, Inc. Engineered services $90,000 420 Exchange, Suite 100 Irvine, CA 92602-1301 Hernandez, Kroone & Assc. Inc. Engineered fees $15,000 234 East Drake Drive San Bernardino, CA 92408 PACIFIC LUMBER: Judge Schmidt to Confirm Marathon/Mendocino Plan ---------------------------------------------------------------- Peg Brickley of Dow Jones Newswires reported Friday that the Hon. Richard Schmidt of the U.S. Bankruptcy Court for the Southern District of Texas said he would confirm a bankruptcy plan to take The Pacific Lumber Co. out of bankruptcy pursuant to a plan proposed by hedge fund Marathon Asset Management and Mendocino Redwood Co., subject to a few modifications. According to the report, Marathon and Mendocino, a rival lumber producer, said they'll pump new money into Pacific Lumber and continue operations at the company. Judge Schmidt had told attorneys during a hearing held on May 29, 2008, that he will likely make a decision on the competing Plans of Reorganization filed in the bankruptcy cases of Pacific Lumber Company and its debtor affiliates before the second week of June, according to the Eureka Reporter. According to the Eureka Reporter, Judge Schmidt heard the final arguments in the PALCO case on May 15, 2008, but kept mum as to which Plan he will select. Abiworld says the Court could issue a decision today. Dow Jones reports that Judge Schmidt turned down a competing Chapter 11 proposal from noteholders who wanted to auction the company's 200,000 acres of California timberlands, according to an opinion filed with the Court. The bondholders told Judge Schmidt at a hearing Friday they plan to appeal the decision and want the Fifth Circuit Court of Appeals to hear their argument. PALCO had backed the Marathon-Mendocino plan. Judge Schmidt's ruling means Marathon and Mendocino can take over the company and keep it running, dashing the hopes of Texas-based Beal Bank and others who hoped to get a chance to buy the timberlands, which are owned by Pacific Lumber's Scotia Pacific unit, Dow Jones say. The noteholders claim they're owed about $900 million, and rejected a $530 million cash recovery they would see under the Marathon-Mendocino plan. They hoped an auction of the timberlands would boost their recovery, and pointed to Beal Bank's $603 million offer as proof, Dow Jones says. Judge Schmidt, however, ruled that the timberlands aren't worth more than $510 million, according to Dow Jones. He is requiring Marathon and Mendocino to guarantee that the noteholders will be paid that amount. Marathon and the bondholders have been fighting for months over Pacific Lumber Co.'s assets. At Friday's hearing, bondholders said they are owed an additional $310 million on top of the $510 million they would get under the approved plan. Marathon attorney David Neier told Judge Schmidt the hedge fund and Mendocino can't make the plan effective and take control of Pacific Lumber if they have to pay the bondholders that additional money. Judge Schmidt scheduled a hearing on the issue on June 13. In his decision, Judge Schmidt rejected the bondholder plan as "laden with conflicts of interest" and tainted with bad faith, noting that Beal Bank is the largest noteholder. Instead of reorganizing the company, the judge said, the bondholders wanted only to foreclose on the timberlands. Schmidt said there was "no certainty" about a deal for the timberlands, and labeled "highly speculative" the bondholder arguments that an auction would improve the return to creditors from Pacific Lumber's bankruptcy case. Another fatal flaw in the bondholder plan, the Court said, was the failure to spell out how Pacific Lumber, which is hemorrhaging cash, would be funded during the 10 months it would take to market and sell the timberlands. In contrast, the Court called Mendocino Redwood "an experienced, environmentally responsible operator with a proven track record." Mendocino, owned primarily by the family that founded the GAP retail chain, operates a comparable forest in Mendocino County, Calif., just south of the timberlands at issue in Pacific Lumber's case. Under the plan that will be confirmed, two companies will be set up: one to run the operations and mill and the other to own the town of Scotia, Calif. Judge Schmidt is requiring Marathon and Mendocino to make a few modifications to the plan before he'll confirm it. The Court said, had the noteholders' plan been confirmed, "the mill would likely be shut down and liquidated, along with the town of Scotia and (Pacific Lumber's) remaining assets, resulting in a loss of jobs for the community and a way of life in the town of Scotia." Frank Bacik, vice president and general counsel for PALCO, told the Eureka Reporter that Judge Schmidt raised concerns about the confirmability of the Marathon/Mendocino Plan under bankruptcy laws. 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, Issue No. 61; http://bankrupt.com/newsstand/or 215/945-7000). PACIFIC LUMBER: BoNY Submits Post-Trial Brief on Impairment Issues ------------------------------------------------------------------ The Bank of New York Trust Company, N.A., as Indenture Trustee for the Timber Notes, delivered to the U.S. Bankruptcy Court for the Southern District of Texas on June 2, 2008, a post-trial brief regarding impairment issues under Section 1124 of the Bankruptcy Code. BoNY notes that the Court asked it to submit a post-trial brief on the issue of whether or not the Scopac Timber Noteholders would be impaired under Section 1124 if they were paid in cash up to the alleged value of their collateral pursuant to the Amended Plan of Reorganization proposed by Marathon Structured Finance Fund L.P., Mendocino Redwood Company, LLC, and the Official Committee of Unsecured Creditors. The plain language of Section 1124 makes clear that full payment of the "allowed" claims of a creditor class does not, per se, render the class unimpaired if the plan modifies other legal, equitable, or contractual rights, Zack A. Clement, Esq., at Fulbright & Jaworski LLP, in Houston, Texas, argues. The legislative history of Section 1124 confirms that Congress eliminated the concept that a creditor receiving a cash payment in full of the allowed amount of its claim is unimpaired, Mr. Clement avers. He relates that in 1994, Section 1124 was amended to strike Section 1124(3) from the Code, thus precluding plan proponents from attempting to "cash out" a creditor's claim by paying the "allowed claim" and treating the claim as "unimpaired." Thus, Mr. Clement clarifies, the only permissible means of treating a class as unimpaired is to (i) leave legal, equitable and contractual rights unaltered as specified in Section 1124(1), or (ii) provide cure and reinstatement as specified in Section 1124(2). The Amended Marathon/Mendocino Plan does neither of these, as acknowledged by Marathon's own admission that Classes 6 and 9 are impaired, he argues. Mr. Clement contends that the fact that the Timber Noteholders' claims are impaired -– and that the "fair and equitable" and "best interests" tests do apply – simply means that these additional grounds exist for denying confirmation of the Amended Marathon/Mendocino Plan: (1) The Amended Plan fails to meet the requirements of Section 1129(b)(2)(A) because it (i) divests BoNY of its liens on all of its collateral, (ii) sells the collateral without giving BoNY the right to credit bid, and (iii) fails to provide BoNY with the indubitable equivalent of its claim. (2) The Amended Marathon Plan violates the "absolute priority" rule by diverting the proceeds of BoNY's collateral to pay (i) unsecured creditors of Scopac and (ii) unsecured creditors of Scopac's equityholder, PALCO, whose rights with respect to the collateral are junior to those of BoNY. (3) Marathon and Mendocino failed to meet their burden of showing that their Amended Plan will provide BoNY with at least as much as it would receive in a Chapter 7 liquidation in violation of section 1129(a)(7) because (i) BoNY would receive more by foreclosing on its collateral following a to Chapter 7; and (ii) MRC and Marathon failed to what BoNY would recover through Scopac's encumbered Headwaters Litigation claims if BoNY retained those claims in a Chapter 7. Mr. Clement emphasizes that even if the Court adopts that the Timber Noteholders' claims are not impaired under the Amended Marathon/Mendocino Plan, other additional shortcomings will render the Amended Plan patently unconfirmable: * The Plan Proponents failed to meet the burden of presenting any probative evidence to counter the uncontradicted evidence of the value of part of BoNY's collateral, including the Headwaters Litigation. * The Marathon Plan ignores the integrity of the Debtors' separate estates by paying PALCO's creditors with proceeds of the sale of BoNY's collateral before paying BoNY in full and then substantively consolidating the separate estates into a combined entity. * The Marathon Plan failed to provide for the payment of intercompany administrative claims and BoNY's superpriority Section 507(b) administrative claims in violation of Sections 1129(a)(9) and (a)(11) of the Bankruptcy Code. * The Marathon Plan improperly classifies BoNY's Class 9 unsecured deficiency claim separately from Class 8 unsecured "trade" claims. * The Marathon Plan discriminates unfairly by providing materially different treatment to separately classified unsecured claims of equal priority that results in a materially lower percentage recovery for BoNY's unsecured deficiency claim. * The Marathon Plan fails to consider the potential impact of federal anti-trust laws. For these reasons, BoNY asks the Court to deny the Marathon/Mendocino Amended Plan as it cannot be confirmed as a matter of law. BoNY reiterates that its Plan is the only confirmable plan for the Debtors. BoNY reminds the Court that it: -- has shown that there is ample liquidity to conduct a sales process where a firm bid offering $603 million has already been presented and other bidders have expressed an interest in participating in the auction for the assets; and -- has presented an offer from Sierra Pacific Industries to act as a stalking horse bidder in a Section 363 sale to purchase the PALCO mill, cogeneration plant and working capital. In a separate filing, BoNY amended its proposed Confirmation Order on May 27, 2008, to delete from paragraph 46 with respect to language waiving the 10-day stay provided by Rule 3020(e) of the Federal Rules of Bankruptcy Procedure. BoNY states that Marathon and Mendocino will do the same amendment on their proposed order for confirmation of the Marathon/Mendocino Plan. Marathon & Mendocino Respond Marathon, Mendocino and the Creditors Committee delivered to the Court on June 2, 2008, a supplemental memorandum of law to address the issue of whether the treatment provided to the holders of Class 6 Scopac Timber Note Secured Claims under the Marathon/Mendocino Plan renders the claims unimpaired pursuant to Section 1124 of the Bankruptcy Code. John D. Penn, Esq., at Haynes and Boone LLP, in Fort Worth, Texas, contends that the Class 6 Claims are unimpaired for these reasons: (i) The claims were accelerated due to Scotia Pacific Company, LLC's bankruptcy filing and are rendered due and payable by operation of the terms of the Prepetition Indenture; (ii) The mere bifurcation of a creditor's claim into a secured claim and an unsecured claim is a function of the Bankruptcy Code, which does not constitute impairment; and (iii) The holders of Class 6 claims will be paid cash in the full amount of their secured claims on the effective date of the Marathon/Mendocino Plan. By paying Class 6 Claims in cash on the Plan Effective Date in an amount equal to or more than the amount of those claims, the Marathon/Mendocino Plan provides Class 6 claim holders with the indubitable equivalent of their Claims, Mr. Penn maintains. By virtue of this argument, he emphasizes, the Marathon/Mendocino Plan satisfies the cramdown provisions of the Bankruptcy Code, and can be confirmed over BoNY's objection. Thus, even if the Court concludes that Class 6 is unimpaired, the Court should also confirm the Marathon/Mendocino Plan on the additional and complementary basis that it satisfies the cramdown requirements of the Bankruptcy Code, Mr. Penn maintains. 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, Issue No. 61; http://bankrupt.com/newsstand/or 215/945-7000). PATIENT SAFETY: Closes $2.4 Million in Equity Financing ------------------------------------------------------- Patient Safety Technologies, Inc. secured $2.485 million in equity financing in a first closing of a private placement. The proceeds will go towards further enhancing sales and marketing at its SurgiCount Medical subsidiary. Investors in the first closing of the private placement purchased 1,987,936 shares of the Company's common stock at a price of $1.25 per share and received a 5-year warrant to purchase an additional 1,192,761 shares of the company's common stock at an exercise price of $1.40 per share. The investors paid $2.059 million in cash and agreed to extinguish $426,000 in existing debt owed to them by PST. Pursuant to the terms of the private placement, the Company may sell up to an aggregate of $4.0 million worth of common stock and warrants by no later than June 19, 2008. PST has agreed to register for resale the shares of common stock sold in the offering. "This round of financing allows us to hire additional staff to meet the increased interest that we are enjoying in our product, primarily as a result of recent environmental changes as well as an overall increased awareness of SurgiCount and its Safety- Sponge(TM) System. We are in contract negotiations with several large medical institutions in the United States. Assuming we successfully enter into contracts with these institutions, among other benefits we anticipate a material increase in our revenues and increased momentum in our sales efforts as the success of our Safety-Sponge System becomes associated with a larger number of institutions," Bill Adams, Chief Executive Officer of PST and SurgiCount, said. Headquartered in Los Angeles, Patient Safety Technologies Inc. (OTC BB: PSTX.OB) -- http://www.patientsafetytechnologies.com/-- through its wholly owned subsidiary, SurgiCount Medical Inc., is a developer and manufacturer of patient safety products including the Safety-Sponge(TM) System. The system helps in reducing the number of retained sponges and towels in patients during surgical procedures ans allows for faster and more accurate counting of surgical sponges. Going Concern Doubt Squar, Milner, Peterson, Miranda & Williamson, LLP, in San Diego, expressed substantial doubt about Patient Safety Technologies 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 reported that the company has reported recurring losses from operations through Dec. 31, 2007, and has a significant accumulated deficit and a significant working capital deficit at Dec. 31, 2007. PENTON BUSINESS: Continued Weakness Cues Moody's to Cut CFR to B3 ----------------------------------------------------------------- Moody's Investors Service has downgraded Penton Business Media Holdings, Inc.'s Corporate Family and Probability of Default ratings to B3 from B2 following continued weakness in operating performance and maintenance of elevated debt levels, which have combined to cause shortfalls in the company's ability to achieve requisite financial leverage targets as previously delineated in Moody's credit opinion. Details of the rating action are: Ratings downgraded: * Corporate Family rating -- to B3 from B2 * PDR -- to B3 from B2 * Senior secured first lien revolving credit facility -- to B2, LGD3, 33% from B1, LGD2, 32% * Senior secured first lien term loan -- to B2, LGD3, 33% from B1, LGD2, 32% * Senior secured second lien term loan -- to Caa2, LGD5, 86% from Caa1, LGD5, 85% * The rating outlook is stable. The rating downgrades reflect operating performance which has fallen short of the targets set by management at the time ratings were assigned in December 2006, and Moody's view that soft market conditions will continue to preclude the company from reducing debt below a low-to-mid-seven times multiple of EBITDA by the end of 2008. The B3 Corporate Family rating recognizes Penton's heavy debt burden and high leverage, its vulnerability to business-to- business (or B-2-B) advertising spending, the high degree of competition experienced by virtually all of its publications and trade shows, the continuing acquisitiveness of its management team and the questionable asset protection metrics afforded to lenders -- especially to second lien lenders. Ratings are supported, nonetheless, by the reputation of Penton's magazine titles and trade shows, the diversification of its customer and product base, and the perceived strength of its management team. The stable outlook reflects the relative predictability and scalability of Penton's businesses, the visibility and relatively high margins of its trade shows, and the leading market position of its niche trade publications, which collectively are expected to allow the company to operate within a range of financial risk as currently employed and still maintain revised ratings. Penton Business Media Holdings, Inc. (formerly known as Penton Media Holdings, Inc.) is one of the largest U.S. business-to- business communications companies. Headquartered in New York City, the company reported sales of $436 million for the LTM period ended March 31, 2008. PERKINS & MARIE: S&P Holds 'B-' Rating and Revises Outlook to Neg. ------------------------------------------------------------------ Standard & Poor's Ratings Services revised its outlook on Memphis, Tennessee-based Perkins & Marie Callender's Inc. to negative from stable. At the same time, S&P affirmed the 'B-' corporate credit rating on the company. "The outlook revision reflects the company's deteriorating performance," said Standard & Poor's credit analyst Jackie E. Oberoi, "which has led to credit metrics that are weak for the rating, including leverage of more than 9x and EBITDA interest coverage of less than 1x." In addition, S&P are concerned that if Perkins' performance continues to decline, the company may not remain in compliance with financial covenants when they become more restrictive in the fourth quarter of fiscal 2008. PRE-BUY ELECTRIC: Texas Electricity Retailers Close After Default ----------------------------------------------------------------- Three electricity retailers in Texas have stopped serving customers, Elizabeth Souder of The Dallas Morning News reports. Etricity, also known as HWY 3 MHP LLC, Pre-Buy Electric LLC and National Power Co. have stopped serving customers after defaulting on payment to the Electric Reliability Council of Texas, which operates the power grid. ERCOT is now switching Etricity's 12,222 customers to other providers, known as providers of last resort, and is nearly finished switching the 23,593 customers of Pre-Buy and National Power. According to the report, electricity companies typically charge higher prices for default service, based on the average price of power in the wholesale spot market. And those prices have spiked in recent weeks as high temperatures boost demand for power, causing congestion on some transmission lines. Industry insiders say more defaults are on the way as wholesale power prices rise, according to the Dallas Morning News. Etricity is based in Denton. Based in Dr. Grapevine is owned by Criag Bolin. It was started in 2005. it has $130,000 in estimated annual sales, according to Manta (http://www.manta.com/). National Power, headquartered in Houston, was started in 2007. Its president is Denise Fields. It has 15 employees. PURADYN FILTER: March 31 Balance Sheet Upside-Down by $5,239,339 ---------------------------------------------------------------- Puradyn Filter Technologies Inc.'s consolidated balance sheet at March 31, 2008, showed $2,524,112 in total assets and $7,763,451 in total liabilities, resulting in a $5,239,339 total stockholders' deficit. The company reported a net loss of $470,475, on net sales of $763,425, for the first quarter ended March 31, 2008, compared with a net loss of $710,913, on net sales of $766,198, for the same period ended March 31, 2007. 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?2d73 Going Concern Doubt As reported in the Troubled Company Reporter on April 30, 2008, Webb and Company, P.A., in Boynton Beach, Fla., expressed substantial doubt about Puradyn Filter Technologies 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 related that the company "has suffered recurring losses from operations, its total liabilities exceed its total assets, and it has relied on cash inflows from an institutional investor and current stockholder." About Puradyn Filter Based in Boynton Beach, Fla., Puradyn Filter Technologies Inc. (OTC BB: PFTI) -- http://www.puradyn.com/-- designs, manufactures and markets the PURADYN(R) Oil Filtration System, a bypass oil filtration product. PURCHASE POINT: March 31 Balance Sheet Upside-Down by $1,913,361 ---------------------------------------------------------------- Purchase Point Media Corp.'s consolidated balance sheet at March 31, 2008, showed $1,275,428 in total assets and $3,188,789 in total liabilities, resulting in a $1,913,361 total stockholders' deficit. At March 31, 2008, the company's consolidated balance sheet also showed strained liquidity with $1,195,322 in total current assets available to pay $3,130,674 in total current liabilities. The company reported a net loss of $1,242,069, on net sales of $493,088, for the first quarter ended March 31, 2008, compared with a net loss of $114,721, on net sales of $807,132, for the same period ended March 31, 2007. 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?2d6e Going Concern Doubt Madsen & Associates, CPA's Inc, in Salt Lake City, expressed substantial doubt about Purchase Point Media Corp.'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 said that the company will need additional working capital for its planned activity and to service its debt. About Purchase Point Based in Pennsauken, N.J., Purchase Point Media Corp. (OTC BB: PPMC) engages in the import, marketing, distribution, and sale of motorcycles and scooters in the United States. REFCO INC: Former CEO Bennett in Talks with Investor-Plaintiffs --------------------------------------------------------------- John P. Coffey, Esq., at Bernstein Litowitz Berger & Grossman, and Stuart M. Grant, Esq., of Grant & Eisenhofer, told Judge Naomi R. Buchwald of the Southern District of New York that Refco Inc. investors that filed a securities class action styled In re Refco Securities Litigation, have held "several highly productive meetings" with Phillip R. Bennett, Refco's former chief executive officer, chairman. The plaintiffs' counsel said it was a "unique opportunity to debrief a former CEO involved in a massive corporate fraud." Early this year, Mr. Bennett had pleaded guilty to bank fraud, conspiracy, money laundering and 17 other charges, in connection with a scheme that caused Refco's bankruptcy, and cost investors more than $2,400,000,000. Mr. Bennett is scheduled to be sentenced on June 19, 2008. "Bennett's assistance has materially strengthened the class' claims against a number of defendants," Mr. Grant wrote on the Web site for the proposed class-action lawsuit, http://refcosecuritieslitigation.com/ According to Bloomberg News, Mr. Bennett, also a defendant in the case, helped the Plaintiffs understand the case, against Refco's underwriters in particular -- its former auditor Grant Thornton LLP, its former law firm Mayer Brown, and Thomas H. Lee Partners LP, which in 2004 bought a 57% stake in the company. "I can't think of another time a CEO who led a massive fraud agreed to sit down with the investors he victimized," Mr. Coffey said in an interview. Mr. Coffey stated that during Mr. Bennett's meetings with the shareholders' lawyers, he "expressed bewilderment that these highly paid advisors accepted at face value what they were told," Anthony Lin of the New York Law Journal reports. According to Messrs. Coffey and Grant, Mr. Bennett "has made a substantial effort to assist the investors hurt by the collapse of Refco," the New York Law Journal reports. "Suffice it to say that Mr. Bennett's assistance has materially strengthened the Class' claims against a number of defendants," Messrs. Coffey and Grant added. The securities fraud class action was called on behalf of persons and entities who purchased or acquired the securities of Refco, Inc. during the period from August 5, 2004 through October 17, 2005. The lawsuit arises from the revelation that Refco had for years secreted amounts ranging from $300,000,000 to $970,000,000 of uncollectible receivables with a related entity controlled by Mr. Bennett. This revelation caused the collapse of the Company a mere two months after its August 10, 2005 initial public offering of common stock, and only 14 months after its issuance of 9% Senior Subordinated Notes due 2012. On February 3, 2006, the Honorable Gerard Lynch appointed Bernstein client RH Capital, Inc., as co-lead plaintiff and Bernstein as co-lead counsel for the Class in this securities fraud class action. Headquartered in New York, Refco Inc. -- http://www.refco.com/-- is a diversified financial services organization with operations in 14 countries and an extensive global institutional and retail client base. Refco's worldwide subsidiaries are members of principal U.S. and international exchanges, and are among the most active members of futures exchanges in Chicago, New York, London and Singapore. In addition to its futures brokerage activities, Refco is a major broker of cash market products, including foreign exchange, foreign exchange options, government securities, domestic and international equities, emerging market debt, and OTC financial and commodity products. Refco is one of the largest global clearing firms for derivatives. The company and 23 of its affiliates filed for chapter 11 protection on Oct. 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006). J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Luc A. Despins, Esq., at Milbank, Tweed, Hadley & McCloy LLP, represents the Official Committee of Unsecured Creditors. Refco reported $16.5 billion in assets and $16.8 billion in debts to the Bankruptcy Court on the first day of its chapter 11 cases. The Court confirmed the Modified Joint Chapter 11 Plan of Refco Inc. and certain of its Direct and Indirect Subsidiaries, including Refco Capital Markets, Ltd., and Refco F/X Associates, LLC, on Dec. 15, 2006. That Plan became effective on Dec. 26, 2006. (Refco Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). RESIDENTIAL CAPITAL: $8.6 Billion Old Notes Tendered ---------------------------------------------------- Residential Capital, LLC, disclosed the expiration and final results of its private exchange offers and cash tender offers for U.S. dollar equivalent $14.0 billion in aggregate principal amount of its outstanding notes. As of 9:00 a.m., New York City time, on Wednesday, June 4, 2008, approximately $2.6 billion aggregate principal amount (or 80%) of old notes that mature in 2008-2009 and approximately $6.0 billion aggregate principal amount (or 63%) of old notes that mature in 2010-2015 notes had been validly tendered. Based upon these results, approximately $1.7 billion aggregate principal amount of new 8.500% Senior Secured Guaranteed Notes due 2010 will be issued in exchange for old 2008-2009 notes and approximately $4.0 billion aggregate principal amount of new 9.625% Junior Secured Guaranteed Notes due 2015 will be issued in exchange for old 2010-2015 notes. A full-text copy of the press release with a table showing the principal amount of each series of old notes tendered is available for free at http://ResearchArchives.com/t/s?2d6f As of the expiration date, approximately $1.6 billion aggregate principal amount of old 2008-2009 notes and U.S. dollar equivalent $2.6 billion aggregate principal amount of old 2010-2015 notes were tendered in the "modified Dutch auction" process described in the informational documents for the offers. Based on these results, the clearing price in the auction process is $920 per $1,000 principal amount of new 8.500% senior secured notes and $650 per $1,000 principal amount of new 9.625% junior secured notes and approximately 81% of old 2008-2009 notes and approximately 51% of old 2010-2015 notes tendered in the auction process at or below the applicable clearing price have been accepted. In addition, approximately $853.4 million aggregate principal amount of Floating Rate Notes due June 9, 2008 were tendered for cash as of the expiration date. Headquartered in Minneapolis, Minnesota, Residential Capital LLC -- http://www.rescapholdings.com/-- is the home mortgage unit of GMAC Financial Services, which is in turn wholly owned by GMAC LLC. * * * As reported in yesterday's Troubled Company Reporter, Moody's Investors Service downgraded to Ca, from Caa1, its ratings on the senior debt of Residential Capital, LLC subject to the bond exchange announced by ResCap on May 2, 2008. The rating of ResCap's approximately $1.2 billion of bonds maturing on June 9, 2008 was affirmed at Caa1. All ratings remain under review for downgrade. Standard & Poor's Ratings Services lowered selected ratings on Residential Capital LLC, including lowering the long-term corporate credit rating to 'CC' from 'CCC+', following the company's launch of an exchange offer for unsecured bonds that S&P interpret as a distressed debt exchange. The ratings remain on CreditWatch with negative implications, where they were placed April 24, 2008. Fitch Ratings has downgraded Residential Capital LLC's Issuer Default Rating to 'C' from 'BB-' following the company's debt exchange offer announcement. ResCap remains on Rating Watch Negative pending execution of the debt exchange offer. Upon completion of the exchange, Fitch will downgrade ResCap's IDR to 'D' indicating a default has occurred in accordance with Fitch's criteria on distressed debt exchanges. RESIDENTIAL CAPITAL: Fitch Puts 'D' Ratings After Debt Exchange --------------------------------------------------------------- Fitch Ratings has downgraded Residential Capital LLC's long- and short-term Issuer Default Ratings to 'D' from 'C' following completion of the company's distressed debt exchange. Fitch has also removed ResCap from Rating Watch Negative, where it was originally placed on May 2. Fitch's action indicates that a default has occurred in accordance with Fitch's criteria on DDEs. Approximately $12.9 billion of outstanding debt is affected by this action. The exchange, which resulted in 80% of notes, tendered maturing 2008 - 2009 and 63% of notes tendered maturing 2010-2015, was necessary to extend debt maturities and increase ResCap's financial flexibility. Fitch is in the process of assigning a post-default IDR and new issue level ratings reflecting a prospective view of ResCap and its new capital structure. Fitch believes that, when assigned, ratings will reflect ResCap's challenges to restructure the business and address liquidity pressures over the near-term. As part of these efforts, ResCap needs to complete a number of transactions with related parties. As such, new IDR and issue level ratings may be placed on Rating Watch Negative pending completion of these initiatives. Fitch would expect to assign new IDR and issue level ratings, including Recovery Ratings, within the next two weeks. Fitch has downgraded these ratings and removed them from Rating Watch Negative: Residential Capital LLC -- Long-term IDR to 'D' from 'C'; -- Short-term IDR to 'D' from 'C'. RESIDENTIAL FUNDING: Fitch Trims Ratings on 10 Cert. Classes ------------------------------------------------------------ Fitch Ratings has taken rating actions on one Residential Funding Mortgage Securities II and four Residential Asset Securities Corporation mortgage pass-through certificates. Unless stated otherwise, any bonds that were previously placed on Rating Watch Negative are now removed. RFMSII 1998-HI2 -- A-5 affirmed at 'AAA'; -- M1 affirmed at 'AAA'; -- M2 affirmed at 'AA+'; -- B1 affirmed at 'A+'; -- B2 affirmed at 'BBB+'; Deal Summary -- 60+ day Delinquency: 4.60% -- Realized Losses to date (% of Original Balance): 9.20% RASC 2001-KS2 Group 1 -- A-I-5 downgraded to 'AA-' from 'AAA'; -- A-I-6 downgraded to 'AA-' from 'AAA'; -- M-I-1 downgraded to 'BBB-' from 'A-'; -- M-I-2 downgraded to 'BB-' from 'BBB-'; -- M-I-3 revised to 'C/DR6' from C/DR3'; Deal Summary -- 60+ day Delinquency: 23.14% -- Realized Losses to date (% of Original Balance): 5.61% RASC 2001-KS2 Group 2 -- A-II affirmed at 'AAA'; -- M-II-1 downgraded to 'A+' from 'AAA'; -- M-II-2 downgraded to 'C/DR5' from 'BB-'; -- M-II-3 downgraded to 'C/DR6' from 'B+'; Deal Summary -- 60+ day Delinquency: 36.29% -- Realized Losses to date (% of Original Balance): 4.40% RASC 2001-KS3 Group 1 -- A-I-5 affirmed at 'AAA'; -- A-I-6 affirmed at 'AAA'; -- M-I-1 affirmed at 'A-'; -- M-I-2 affirmed at 'BB+'; -- M-I-3 remains at 'C/DR3'; Deal Summary -- 60+ day Delinquency: 23.26% -- Realized Losses to date (% of Original Balance): 5.51% RASC 2001-KS3 Group 2 -- A-II affirmed at 'AAA'; -- M-II-1 downgraded to 'BBB+' from 'AA'; -- M-II-2 downgraded to 'B' from 'BB'; -- M-II-3 downgraded to 'C/DR6' from 'B+'; Deal Summary -- 60+ day Delinquency: 39.63% -- Realized Losses to date (% of Original Balance): 3.98% RHAPSODY ACQUISITION: BDO Seidman Expresses Going Concern Doubt --------------------------------------------------------------- New York-based BDO Seidman, LLP, raised substantial doubt about the ability of Rhapsody Acquisition Corp. to continue as a going concern after it audited the company's financial statements for the year ended March 31, 2008. According to the auditing firm, "The company is required to consummate a business combination by Oct. 3, 2008, after it entered into a definitive agreement of merger and the possibility of such business combination not being consummated raises substantial doubt about its ability to continue as a going concern." Organization and Business Operation Rhapsody Acquisition was incorporated in Delaware on April 24, 2006 as a blank check company whose objective is to acquire an operating business. The registration statement for the company's initial public offering was declared effective Oct. 3, 2006. The company consummated the offering on Oct. 10, 2006, and received net proceeds of $38,833,559. The company's management has broad discretion with respect to the specific application of the net proceeds of this offering, although substantially all of the net proceeds of this offering are intended to be generally applied toward consummating a business combination with an operating business. Furthermore, there is no assurance that the company will be able to successfully effect a business combination. An amount of $41,049,635 (including interest of $1,771,385 after the transfer of $200,000 of interest income), which includes $1,250,000 relating to the sale of insider warrants and a $414,000 deferred amount payable to the underwriter, of the net proceeds is being held in an interest-bearing trust account until the earlier of the consummation of a business combination or liquidation of the company. The company has signed a definitive agreement for the acquisition of a target business and will submit such transaction for stockholder approval. In the event that stockholders owning 20% or more of the shares sold in the Offering vote against the Business combination and exercise their conversion rights described below, the Business combination will not be consummated. All of the company's stockholders prior to the Offering, including all of the officers and directors of the company, have agreed to vote their 1,125,000 founding shares of common stock in accordance with the vote of the majority in interest of all other stockholders of the company with respect to any Business combination. After consummation of a business combination, these voting safeguards will no longer be applicable. If a business combination will be approved and consummated, any Public Stockholder who voted against the business combination may demand that the company convert his shares. The per share conversion price will equal the amount in the Trust Account, calculated as of two business days prior to the consummation of the proposed business combination, divided by the number of shares of common stock held by Public Stockholders at the consummation of the Offering. Accordingly, Public Stockholders holding 19.99% of the aggregate number of shares owned by all Public Stockholders may seek conversion of their shares in the event of a Business combination. Such Public Stockholders are entitled to receive per share interest in the Trust Account computed without regard to the shares held by Initial Stockholders. Accordingly, a portion of the net proceeds from the offering (19.99% of the amount held in the Trust Account and accretion of interest earned aggregating $8,205,826) has been classified as common stock subject to possible conversion in the accompanying March 31, 2008 balance sheet. The company's Amended and Restated Certificate of Incorporation provides for mandatory liquidation of the company in the event that it is unable to consummate a business combination by Oct. 3, 2008. In the event of liquidation, it is likely that the per share value of the residual assets remaining available for distribution, including Trust Account assets, will be less than the initial public offering price per share in the Offering due to costs related to the Offering and since no value would be attributed to the Warrants contained in the Units sold. Financials The company posted a net income of $450,562 for the year ended March 31, 2008, as compared with a net income of $351,102 in the prior year. At March 31, 2008, the company's balance sheet showed $41,124,125 in total assets, $8,833,628 in total liabilities, and $32,290,497 in total stockholders' equity. A full-text copy of the company's 2007 annual report is available for free at http://ResearchArchives.com/t/s?2d59 About Rhapsody Acquisition Rhapsody Acquisition Corp. (RPSD.OB) intends to serve as a vehicle to effect a merger, capital stock exchange, asset acquisition, or other similar business combination with an operating business. The company was founded in 2006 and is based in New York, New York. RIGALI SECURITY: Foreclosure Sale of Assets Set for Wednesday ------------------------------------------------------------- Creditor SAFE Financial LLC will hold a foreclosure sale on certain assets of Rigali Security Alarms in California at 10:00 a.m., on June 11, 2008, Wednesday. The venue of the sale is at the offices of Reed Smith LLP, Two Embarcadero Center, Suite 2000 in San Francisco, California. Interested bidders may contact Scott M. Esterbrook, Esq., at (215) 851-8146 for more information. RUFFIN ROAD: Voluntary Chapter 11 Case Summary ---------------------------------------------- Lead Debtor: Ruffin Road Venture Lot 3 8690 Aero Dr., Ste. 387 San Diego, CA 92123 Bankruptcy Case No.: 08-05008 Debtor-affiliates filing separate Chapter 11 petitions: Entity Case No. ------ -------- Ruffin Road Venture Lot 6 08-05009 Chapter 11 Petition Date: June 4, 2008 Court: Southern District of California (San Diego) Judge: Louise DeCarl Adler Debtors' Counsel: Judith A. Descalso, Esq. Email: descalso@pacbell.net 960 Canterbury Pl., Ste. 340 Escondido, CA 92025 Tel: (760) 745-8380 Fax: (760) 860-9800 Ruffin Road Venture Lot 3's Financial Condition: Estimated Assets: $1 million to $10 million Estimated Debts: $1 million to $10 million The Debtor does not have any unsecured creditors who are not insiders. SAND HILL CAPITAL: Files for Chapter 7; Founder Goes Bankrupt Too ----------------------------------------------------------------- William "Boots" Del Biaggio III filed a petition for chapter 11 bankruptcy protection Friday before the U.S. Bankruptcy Court for the Northern District of California, two weeks after being accused of loan fraud, The Associated Press and San Jose (Calif.) Mercury News report. Sand Hill Capital Partners III, the investment fund Mr. Del Biaggio co-founded, filed for chapter 7 bankruptcy, reports say. The AP, citing court documents, says Mr. Del Biaggio, has at least $57,000,000 in unpaid personal and business loans, credit card bills and other financial obligations. Sand Hill disclosed $10.6 million in debts, according to AP. Mr. Del Biaggio stepped down from Sand Hill Capital late in May. According to the reports, Mr. Del Biaggio is facing charges for roughly $17,000,000 in the aggregate from lenders. AP says Modern Bank, a New York-based private bank, is trying to force Mr. Del Biaggio to repay $10,000,000 he used to help buy his stake of the Nashville Predators of the National Hockey League. Mercury News saays Mr. Del Biaggio put in 27% of the $193,000,000 raised by an investor group that acquired the team in November 2007. AP continues that Heritage Bank of Commerce, a San Jose-based bank co-founded by Mr. Del Biaggio's father, has demanded that Mr. Del Biaggio immediately repay a $4,000,000 loan. DGB Investments Inc., a San Jose-based investment firm, is suing Mr. Del Biaggio over an unpaid $3 million loan, adds AP. The reports say those transactions and others are subject to an investigation by the U.S. Attorney's Office in San Francisco, and the Securities and Exchange Commission over allegations that Mr. Del Biaggio faked the collateral for the loans. Canada's The National Post says Mr. Del Biaggio tried to sell his stake in the Nashville Predators days before the lawsuits were filed. Unnamed sources told the National Post that NHL officials opposed the deal. The Post says Mr. Del Biaggio was in talks with Jim Balsillie, co-CEO of Blackberry-creator Research in Motion Ltd. According to the report, a tentative deal had been worked out that would have paid a "significant premium" above the estimated $30,000,000 book value for Mr. Del Biaggio's combined 1/3 interest in the hockey team. Mercury News says Sand Hill Capital has indicated that Mr. Del Biaggio's investment fund has nothing to do with Sand Hill Capital and that Mr. Del Biaggio has no right to use its name. Established in 1996, Sand Hill Capital has four debt funds under management, of which two are actively investing. Sand Hill has provided debt financing and equity co-investing in multiple portfolio companies of top-tier venture capital firms, including Broadcom, a semiconductor company specializing in VoIP, wireless networking, and broadband communications solutions; Commerce One, a provider of On-Demand Supplier Relationship Management solutions and The Open Supplier Network; IBahn, a provider of secure broadband-to-go at premium hospitality locations; and Odwalla, maker of fruit drinks and snacks. SAXON MORTGAGE: Fitch Chips Ratings on Seven Certificate Classes ---------------------------------------------------------------- Fitch Ratings has rating actions on 12 Saxon mortgage pass-through certificates. Unless stated otherwise, any bonds that were previously placed on Rating Watch Negative are removed from Rating Watch Negative. Saxon 1999-2 Group 1 -- MF-2 affirmed at 'AA+'; -- BF-1 affirmed at 'A+'. Deal Summary -- 60+ day Delinquency: 22.39% -- Realized Losses to date (% of Original Balance): 5.61% Saxon 1999-3 Group 1 -- MF2 affirmed at 'AA+'; -- BF1 affirmed at 'A+'; -- BF-1A affirmed at 'A'. Deal Summary -- 60+ day Delinquency: 17.05% -- Realized Losses to date (% of Original Balance): 5.97% Saxon 1999-3 Group 2 -- BV1 affirmed at 'AA'. Deal Summary -- 60+ day Delinquency: 27.08% -- Realized Losses to date (% of Original Balance): 5.02% Saxon 1999-5 -- MF1 affirmed at 'AA+'; -- MF2 affirmed at 'A'; -- BF downgraded to 'CC/DR2' from 'CCC/DR3'. Deal Summary -- 60+ day Delinquency: 18.74% -- Realized Losses to date (% of Original Balance): 6.53% Saxon 2000-2 Group 1 -- MF-1 affirmed at 'AA+'; -- MF-2 affirmed at 'BBB'; -- BF-1 remains at 'CC/DR4'. Deal Summary -- 60+ day Delinquency: 25.87% -- Realized Losses to date (% of Original Balance): 7.06% Saxon 2000-2 Group 2 -- BV-2 affirmed at 'BB+'. Deal Summary -- 60+ day Delinquency: 37.31% -- Realized Losses to date (% of Original Balance): 5.50% Saxon 2000-3 Group 1 -- MF-1 affirmed at 'AA+'; -- MF-2 affirmed at 'B'; -- BF-1 downgraded to 'CC/DR1' from 'CCC/DR1'. Deal Summary -- 60+ day Delinquency: 22.42% -- Realized Losses to date (% of Original Balance): 8.13% Saxon 2000-4 Group 1 -- MF-1 affirmed at 'AA+'; -- MF-2 downgraded to 'B-/DR1' from 'BB'; -- BF-1 downgraded to 'C/DR5' from 'CC/DR2'. Deal Summary -- 60+ day Delinquency: 25.35% -- Realized Losses to date (% of Original Balance): 7.88% Saxon 2000-4 Group 2 -- BV-1 affirmed at 'AA-'. Deal Summary -- 60+ day Delinquency: 24.43% -- Realized Losses to date (% of Original Balance): 4.87% Saxon 2001-1 Group 1 -- PF-1 affirmed at 'AAA'; -- MF-1 affirmed at 'AA+'; -- MF-2 downgraded to 'CCC/DR1' from 'B'; -- BF-1 remains at 'C/DR5'. Deal Summary -- 60+ day Delinquency: 20.28% -- Realized Losses to date (% of Original Balance): 7.96% Saxon 2001-1 Group 2 -- BV-1 affirmed at 'A+'. Deal Summary -- 60+ day Delinquency: 36.35% -- Realized Losses to date (% of Original Balance): 5.74% Saxon 2001-3 -- AF-6 affirmed at 'AAA'; -- AV1 affirmed at 'AAA'; -- X-IO affirmed at 'AAA'; -- M-1 affirmed at 'A'; -- M-2 downgraded to 'B-/DR2' from 'BB'; -- B downgraded to 'C/DR4' from 'CCC/DR2' Deal Summary -- 60+ day Delinquency: 27.25% -- Realized Losses to date (% of Original Balance): 5.17% SOUTHERN UNION: Fitch Cuts Preferred Stock Rating to BB+ from BBB- ------------------------------------------------------------------ Fitch Ratings has downgraded the ratings of Southern Union Company. The ratings Outlook is Stable. At the same time, Fitch has affirmed the ratings at SUG's subsidiary, Panhandle Eastern Pipeline Company LP, and revised the Outlook to Negative from Stable. Approximately $3.5 billion of obligations are affected by these actions. Fitch has downgraded these ratings: Southern Union Company -- Long-term IDR to 'BBB-' from 'BBB'; -- First mortgage bonds to 'BBB' from 'BBB+'; -- Senior unsecured to 'BBB-' from 'BBB'; -- Junior subordinated to 'BB+' from 'BBB-'; -- Preferred stock to 'BB+' from 'BBB-'; -- Rating Outlook Stable. Fitch has also affirmed these ratings: Panhandle Eastern Pipeline -- Long-term IDR 'BBB'; -- Senior unsecured 'BBB'; -- Rating Outlook to Negative from Stable. Fitch will publish a more detailed rating analysis shortly. ST. STEPHEN: Voluntary Chapter 11 Case Summary ---------------------------------------------- Debtor: St. Stephen the Great LLC 3 Riverway, Suite 1800 Houston, TX 77056 aka 1119839 U.K. Company Registration 7-11 St. Werburgh St. Chester, England CH1 2EJ Bankruptcy Case No.: 08-33689 Type of Business: The Debtor is an Orthodox lay charity company, which was established in 2004 to acquire redundant churches in order to put them into use for Orthodox Christian worship. Its objects also include spreading the Gospel message through distribution of the printed word and supporting Orthodox Christian mission in the U.K. See http://ststephentrust.org.uk/ Chapter 11 Petition Date: June 4, 2008 Court: Southern District of Texas (Houston) Judge: Marvin Isgur Debtor's Counsel: Mark J. Brewer, Esq. Brewer & Pritchard, PC Three Riverway, 18th Floor Houston, TX 77056 Tel: (713) 209-2950 Estimated Assets: $100,001 to $500,000 Estimated Debts: $1,000,001 to $10 million The Debtor did not file a list of its 20 largest unsecured creditors. SCHOEN INVESTMENTS: Case Summary & 5 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Schoen Investments, Inc. 211 West Highway 332 Lake Jackson, TX 77566 Bankruptcy Case No.: 08-33548 Chapter 11 Petition Date: June 2, 2008 Court: Southern District of Texas (Houston) Judge: Jeff Bohm Debtors' Counsel: Barbara Mincey Rogers Rogers, Anderson & Bensey, PLLC 1415 North Loop West, Ste 1020 Houston, TX 77008 Tel: (713) 868-4411 Fax: (713) 868-4413 E-mail: b.m.rogers@att.net Total assets: $2,146,268.40 Total debts: $1,412,299.00 Debtor's five largest unsecured creditors: Entity Nature of Claim Amount ------ --------------- ------ Business Loan Center, LLC Fee Simple $1,195,535 700 North Pearl, Ste. 1850 Dallas, TX 75201 Value: $946,193 Kwik Industries, Inc. Non-Purchase Money $150,000 4725 Nall Road Dallas, TX 75244-4620 Howard & Irene White Loan from Insider $50,000 1630 Dietz Elkhorn Rd. Boerne, TX 78015 Brazoria County Appraisal Taxes $14,264 District 500 N. Chenango Value: $75.00 Angleton, TX 77515-4650 A.T. Merrill Goods and/or $2,500.00 P.O. Box 1422 services Lake Jackson, TX 77566 SHELLS SEAFOOD: Earns $119,588 in 2008 1st Quarter Ended March 30 ----------------------------------------------------------------- Shells Seafood Restaurants Inc. reported net income of $119,588, on revenues of $10,697,065, for the first quarter ended March 30, 2008, compared with net income of $34,926, on revenues of $13,434,904, for the same period ended April 1, 2007. The decrease in revenues predominantly reflects a 15.6% decrease in same store sales and; to a lesser extent, the second and fourth quarter 2007 dispositions of two under performing restaurants. As of the end of the first quarter of 2008, the company had 23 restaurants in operation, compared to 25 restaurants at the end of the first quarter of 2007. Restaurant operating costs were $9,475,000, or 89.2% of restaurant sales, in the first quarter of 2008, compared to $12,273,000, or 91.6% of restaurant sales, in the first quarter of 2007. General and admistrative expenses were $946,000, or 8.8% of revenues, in the first quarter of 2008 compared to $1,025,000, or 7.6% of revenues, in the first quarter of 2007. Balance Sheet At March 30, 2008, the company's consolidated balance sheet showed $11,534,563 in total assets, $10,469,368 in total liabilities, $549,011 in minority partner interest, and $516,184 in total stockholders' equity. The company's consolidated balance sheet at March 31, 2008, also showed strained liquidity with $2,816,760 in total current assets available to pay $6,993,359 in total current liabilities. 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?2d6b Going Concern Doubt As reported in the Troubled Company Reporter on April 14, 2008, Kirkland, Russ, Murphy & Tapp, P.A., expressed substantial doubt about Shells Seafood Restaurants Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements for the year ended Dec. 30, 2007. The auditing firm reported that the company has incurred recurring losses from operations, has an accumulated deficit and has a secured promissory note due in fiscal 2008. About Shells Seafood Based in Tampa, Florida, Shells Seafood Restaurants Inc. (OTC BB: SHLL.OB) -- http://www.shellsseafood.com/-- manages and operates 23 full-service, neighborhood seafood restaurants in Florida under the name "Shells". SIMON WORLDWIDE: March 31 Balance Sheet Upside-Down by $17,031,000 ------------------------------------------------------------------ Simon Worldwide's consolidated balance sheet at March 31, 2008, showed $18,705,000 in total assets, $1,703,000 in total liabilities, and $34,033,000 in redeemable preferred stock, resulting in a $17,031,000 total stockholders' deficit. The company reported a net loss of $847,000 for the first quarter ended March 31, 2008, compared with a net loss of $352,000 for the same period ended March 31, 2007. The company generated no sales or gross profits during the three months ended March 31, 2008, and 2007. General and administrative expenses totaled $903,000 during the three months ended March 31, 2008, compared to $642,000 during the same period in the prior year. The increase was primarily due to approximately $300,000 in advisory and legal costs associated with reviewing the possible recapitalization of the company. Interest income totaled $108,000 during the three months ended March 31, 2008, compared to $214,000 during the same period in the prior year. Interest income is earned on the company's cash bank balances and primarily indexed to the Fed Fund Rate. The decrease in the company's bank balances and decrease in the Fed Fund Rate resulted in the decreased interest income. The company recorded an investment impairment of approximately $16,000 during the three months ended March 31, 2008, and a nominal investment impairment during the same period in the prior year. Such impairments were recorded to adjust the recorded value of its investments accounted for under the cost method, which does not include the company's investment in Yucaipa AEC, to the estimated future undiscounted cash flows the company expects from such investments. 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?2d69 Going Concern Doubt As reported in the Troubled Company Reporter on April 8, 2008, BDO Seidman, LLP, in Los Angeles, espressed substantial doubt about Simon Worldwide Inc.'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. BDO Seidman pointed to the company's stockholders' deficit, significant losses from operations, and lack of any operating revenue. About Simon Worldwide Headquartered in Los Angeles, Calif., Simon Worldwide Inc. (OTC: SWWI) was prior to August 2001, a multi-national, full service promotional marketing company. In August 2001, McDonald's Corporation, the company's principal customer, terminated its 25- year relationship with the company as a result of the embezzlement by a former company employee of winning game pieces from McDonald's promotional games administered by the company. As a result of the loss of its customers, the company no longer has any operating business. Since August 2001, the company has concentrated its efforts on reducing its costs and settling numerous claims, contractual obligations, and pending litigation. As a result of these efforts, the company has been able to resolve a significant number of outstanding liabilities that existed at Dec. 31, 2001, or arose subsequent to that date. At March 31, 2008, the company had reduced its workforce to 4 employees from 136 employees at Dec. 31, 2001. The company is currently managed by the chief executive officer, together with a principal financial officer and an acting general counsel. SOUTHLAND TERRACE: Voluntary Chapter 11 Case Summary ---------------------------------------------------- Debtor: Southland Terrace Apartments, L.P. 2202 Southland Street Unit B Dallas, TX 75215-4205 Bankruptcy Case No.: 08-32746 Chapter 11 Petition Date: June 3, 2008 Court: Northern District of Texas (Dallas) Judge: Harlin DeWayne Hale Debtor's Counsel: Robert M. Nicoud, Jr., Esq. Olson, Nicoud & Gueck, LLP 1201 Main Street, Suite 2470 Dallas, TX 75202 Tel: (214) 979-7300 Fax: (214) 979-7301 E-mail: rmnicoud@dallas-law.com Estimated Assets: $1 million to $10 million Estimated Debts: $1 million to $10 million The Debtor did not file a list of its 20 Largest Unsecured Creditors. SPAP-2005: Voluntary Chapter 11 Case Summary -------------------------------------------- Debtor: SPAP-2005, LLC fka Humphreys & Stohpaul LLC fka Humphreys, Hood, Herrera and Burton, L.L.C. 420 Stocking Avenue, NW Grand Rapids, MI 49504 Bankruptcy Case No.: 08-04061 Type of Business: The Debtor is a single asset real estate. Chapter 11 Petition Date: May 6, 2008 Court: Western District of Michigan (Grand Rapids) Debtor's Counsel: Robert A. Stariha, Esq. Stariha Law Offices, P.C. 48 W. Main Street, Suite 6 Fremont, MI 49412 Tel: (231) 924-3761 e-mail: slobr@sbcglobal.net Estimated Assets: $500,001 to $1,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor does not have creditors who are not insiders. STEVEN PATHMAN: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Steven M. Pathmann 127 Cranberry Lane Lake Barrington, IL 60010 Bankruptcy Case No.: 08-14500 Chapter 11 Petition Date: June 5, 2008 Court: Northern District of Illinois (Chicago) Judge: Jacqueline P. Cox Debtors' Counsel: Joel A Schechter, Esq. Law Offices Of Joel Schechter 53 W Jackson Blvd., Ste. 1025 Chicago, IL 60604 Tel: (312) 332-0267 Fax: (312) 939-4714 E-mail: joelschechter@covad.net Estimated assets: $1 million to $10 million Estimated debts: $1 million to $10 million A copy of the Debtor's petition and a list of its 20 largest unsecured creditors are available at no charge at: http://bankrupt.com/misc/ilnb08-14500.pdf STURGIS IRON: Sells Assets to SDI Sub for $41,000,000 ----------------------------------------------------- The Hon. Jeffrey R. Hughes of the United States Bankruptcy Court for the Western District of Michigan authorized Sturgis Iron & Iron Metal Co. Inc. to sell substantially all of its assets to SDI Sub, LLC for $41,000,000 under an asset purchase agreement dated May 12, 2008, as amended. Under the agreement, SDI Sub can elect to pay $1,000,000 to the Debtor's Elkhart facility, which was classified as a superfund site by the U.S Environmental Protection Agency in April 2008. Furthermore, SDI Sub is expected to enter into a binding real estate purchase agreement with a non-debtor entity, R11 LLC, for the acquisition of certain property in Fitzgerald, Ben Hill County, Georgia. Approximately $2,100,000 plus cost of title insurance, current real estate taxes and other fees will be deducted from the $41,000,000 purchase price to pay existing liens on the property. The Court authorized the Debtors to assume the executory contracts and unexpired leases with the Port of Monroe, which consist of: i) a right for first refusal, ii) a development rights agreement, and iii) an unexpired lease of certain real property at the Monroe facility. The closing of the sale is expected to occur by June 16, 2008. A full-text copy of the asset purchase agreement is available for free at http://ResearchArchives.com/t/s?2d63 About Sturgis Iron Based in Sturgis, Michigan, Sturgis Iron & Metal Co., Inc. sells ferrous metal scrap & waste in wholesale. It also manufactures secondary nonferrous metals, and provides pre-finishing iron or steel processes services, finishing metal processing services, and smelting metal services. The company filed for chapter 11 protection on Apr. 4, 2008 (Bankr. W.D. Mich. Case No. 08-02966). Jay L. Welford, Esq., Judith Greenstone Miller, Esq., Paige Barr, Esq., Paul R. Hage, Esq. and Richard E. Kruger, Esq., at Jaffe Raitt Heuer & Weiss, P.C. represent the Debtor in its restructuring efforts. The Debtor selected Kurtzman Carson Consultants LLC as claims agent. The U.S. Trustee for Region 9 appointed an Official Committee of Unsecured Creditors in this case. The Committee proposed Winston & Strawn LLP as its counsel. As reported in the Troubled Company Reporter on May 13, 2008, the Debtor's summary of schedules shows total assets of $23,363,626 and total debts of $96,346,739. SURE ELECTRIC: Voluntary Chapter 11 Case Summary ------------------------------------------------ Debtor: Sure Electric LLC dba Riverway Power Company 3 Riverway, Suite 1900 Houston, TX 77056 Bankruptcy Case No.: 08-33664 Description: Zahed Lateef, managing member of Riverway Power Partners LLC, filed the petition on the Debtor's behalf. Riverway Power Partners is the sole member of the Debtor. Chapter 11 Petition Date: May 3, 2008 Court: Southern District of Texas (Houston) Judge: Jeff Bohm Debtor's Counsel: Ronald J. Sommers, Esq. (efilers@nathansommers.com) Nathan Sommers Jacobs 2800 Post Oak Blvd., 61st Floor Houston, TX 77056-6102 Tel: (713) 892-4801 Fax : 713-892-4800 Estimated Assets: $1,597,000 Estimated Debts: $1,726,740 A copy of the Debtor's petition with a list of unsecured creditors is available for free at http://bankrupt.com/misc/txsb08-33664.pdf TALBOTS INC: Cuts 9% of Workforce Slashing $14 Million on Costs --------------------------------------------------------------- The Talbots Inc. disclosed that as part of its strategic long- range plan to streamline operations and rationalize its cost structure, it is reducing its corporate headcount, across multiple locations and at all levels, by approximately 9%. The company expects this action to result in estimated annualized cost savings of approximately $14 million, which contributes to the company's goal to reduce its cost structure by a minimum of $100 million by the end of fiscal 2009. Net expense associated with the reduction, which is for severance and severance benefits well as related professional consulting fees, is expected to total approximately $5.9 million. Of this, approximately $2.1 million of net pre-tax expense was recorded in the first quarter of fiscal 2008, which was included in the company's restructuring charge as detailed in its first quarter 2008 results disclosed on May 21, 2008. The company expects to record the additional net pre-tax expense of approximately $3.8 million in connection with this action in the second quarter of fiscal 2008. "A key finding of our strategic review completed in the first quarter of 2008 was the need to realign and streamline internal company functions to enable the successful execution of our long- range plan," Trudy F. Sullivan, president and chief executive officer of The Talbots Inc., said. "We therefore are examining all areas of our business to maximize efficiency and drive overall improved productivity. We are making excellent progress in achieving all of the objectives laid out in our strategic long- range plan and are firmly on track to restore profitability from our ongoing core operations and deliver enhanced shareholder value beginning in 2008." "It was clearly a difficult strategic decision to reduce our corporate staffing levels, but it was an important and necessary step towards strengthening our organization for the long term. We are making every effort to assist the affected employees in making a successful career transition." Affected employees were notified on or immediately prior to June 5, 2008, and of their eligibility for severance and outplacement benefits. The company has also reconfirmed its outlook for fiscal 2008 earnings per share as detailed in a statement issued on May 21, 2008, regarding its first quarter 2008 results. Letter of Credit Reductions As reported in the Troubled company Reporter on April 17, 2008, the company disclosed in a regulatory filing with the Securities and Exchange Commission filing, that on April 9, 2008, The Talbots Inc., and The Talbots Group Limited Partnership received notification from The Hongkong and Shanghai Banking Corporation Limited that HSBC was no longer prepared to continue making letter of credit facilities available to Talbots. Prior to the notification, Talbots had available from HSBC a letter of credit facility, used to finance the import of merchandise, with a limit of $135 million. Pursuant to its notification, effective as of April 8, 2008, HSBC reduced the company's prior letter of credit facility limit of $135 million to $60 million. HSBC also advised that it will further reduce the company's letter of credit facility limit to $45 million on May 8, 2008, to $30 million on June 9, 2008, to $15 million on July 8, 2008, and the facility will be cancelled on Aug. 8, 2008. Any further letters of credit would be at the bank's discretion and considered on a case by case basis. The Talbots Inc., clarified that its recent arrangements with major vendors, along with currently available working capital lines, are expected to be sufficient to fund Talbots' working capital needs under its 2008 operating plan. About Talbots Headquartered in Hingham, Massachusetts, The Talbots Inc. (NYSE:TLB) -- http://www.talbots.com/-- is a specialty retailer and direct marketer of women's apparel, shoes and accessories. The company operates stores in 869 locations in 47 states, the District of Columbia, and Canada, with 595 locations under the Talbots brand name and 274 locations under the J. Jill brand name. Both brands target the age 35 plus customer population. Talbots brand on-line shopping site is located at http://www.talbots.com/ and the J. Jill brand on-line shopping site is located at http://www.jjill.com/ TETRAGENEX PHARMA: Sherb & Co. Expresses Going Concern Doubt ------------------------------------------------------------ In a letter dated May 12, 2008, Demetrius & Company, L.L.C., raised substantial doubt on the ability of Tetragenex Pharmaceuticals, Inc., to continue as a going concern after it audited the company's financial statements for the year ended Dec. 31, 2007. The auditor pointed to the company's recurring operating losses and net capital deficiency. The company posted a net loss of $4,579,958 on $0 revenues for the year ended Dec. 31, 2007, as compared with net loss of $2,964,001 on $0 revenues in the prior year. At Dec. 31, 2007, the company's balance sheet showed $1,013,928 in total assets and $3,214,829 in total liabilities, resulting in $2,200,901 stockholders' deficit. The company's consolidated balance sheet at Dec. 31, 2007, also showed strained liquidity with $561,514 in total current assets available to pay $1,332,467 in total current liabilities. A full-text copy of the company's 2007 annual report is available for free at: http://ResearchArchives.com/t/s?2d0f About Tetragenex Pharmaceuticals Tetragenex Pharmaceuticals, Inc., (OTC BB: TTRX.OB) -- http://www.tetragenex.com-- a biopharmaceutical company, engages in the discovery, development, and commercialization of pharmaceutical products to treat serious diseases. The company's principal product includes Nemifitide, an antidepressant compound that treats depression, anxiety, and other central nervous system disorders, which is in late Phase II human clinical trials. The company was founded in 1989 and is headquartered in Park Ridge, New Jersey. TOUSA INC: Court Okays Robert Charles as Committee's Advisors ------------------------------------------------------------- The Official Committee of Unsecured Creditors in TOUSA Inc. and its debtor-affiliates' Chapter 11 cases obtained final approval from the U.S. Bankruptcy Court for the Southern District of Florida to retain Robert Charles, as its real estate advisors, nunc pro tunc to March 27, 2008. Citicorp North America Inc., as administrative agent for certain prepetition lenders, tried to block the Committee's request. Citicorp told the Court at a hearing that the proposed services for Robert Charles can be performed by the Committee's financial advisor, Jefferies & Company Inc. The Committee has filed three separate applications for the retention of Jefferies, Robert Charles, and J.H. Cohn LLP. Each of these professionals are being retained to analyze business plans and valuations and to provide litigation support, Citicorp noted. "Clearly, the retention of multiple professionals to perform the same services is duplicative," Allan E. Wulbern, Esq., at Smith Hulsey & Busey in Jacksonville, Florida, said on Citicorp's behalf. In response, the Committee convinced the Court that each firm's responsibilities have been carefully negotiated and tailored to avoid duplication, appropriately make use of each firm's expertise, and ultimately will be complementary in assisting the Creditors Committee in, among other things, analyzing the Debtors' business operations, financial results and reorganization efforts. The Court made it clear that as real estate advisors, Robert Charles is expected to: (a) review the Debtors' project-specific business plans, with particular emphasis on the Debtors' assumptions relating to future home prices and absorption rates; (b) review and prepare fundamentals-based forward market assessments for the homebuilding industry for each of the markets where the Debtors have homebuilding or land development activities; (c) prepare project analyses and valuations; (d) provide litigation support and expert testimony, as required; and (e) provide other services as reasonably requested by the Creditors Committee. About TOUSA Inc. Headquartered in Hollywood, Florida, TOUSA Inc. (Pink Sheets: TOUS) -- http://www.tousa.com/-- fka Technical Olympic U.S.A. Inc., dba Technical U.S.A., Inc., Engle Homes, Newmark Homes L.P., TOUSA Homes Inc. and Newmark Homes Corp. is a leading homebuilder in the United States, operating in various metropolitan markets in 10 states located in four major geographic regions: Florida, the Mid-Atlantic, Texas, and the West. TOUSA designs, builds, and markets high-quality detached single-family residences, town homes, and condominiums to a diverse group of homebuyers, such as "first-time" homebuyers, "move-up" homebuyers, homebuyers who are relocating to a new city or state, buyers of second or vacation homes, active-adult homebuyers, and homebuyers with grown children who want a smaller home. It also provides financial services to its homebuyers and to others through its subsidiaries, Preferred Home Mortgage Company and Universal Land Title Inc. The Debtor and its debtor-affiliates filed for separate Chapter 11 protection on Jan. 29, 2008. (Bankr. S.D. Fla. Case No.: 08-10928). The Debtors have selected M. Natasha Labovitz, Esq., Brian S. Lennon, Esq., Richard M. Cieri, Esq. and Paul M. Basta, Esq., at Kirkland & Ellis LLP and Paul Steven Singerman, Esq., at Berger Singerman to represent them in their restructuring efforts. Lazard Freres & Co. LLC is the Debtors' investment banker and financial advisor. Ernst & Young LLP is selected as the Debtors' independent auditor and tax services provider. Kurtzman Carson Consultants LLC acts as the Debtors' Notice, Claims & Balloting Agent. The Official Committee of Unsecured Creditors hired Patricia A. Redmond, Esq., and the law firm Stearns Weaver Weissler Alhadeff & Sitterson, P.A., as its local counsel. TOUSA Inc.'s financial condition as of Sept. 30, 2007, showed total assets of $2,276,567,000 and total debts of $1,767,589,000. Its consolidated detailed balance sheet as of Feb. 29, 2008 showed total assets of $1,961,669,000 and total liabilities of $2,278,106,000. TOUSA's Exclusive Plan Filing Period expires October 25, 2008. (TOUSA Bankruptcy News, Issue No. 14; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). TOUSA INC: DIP Termination Date Extended Until June 11 ------------------------------------------------------ TOUSA Inc. and its debtor-affiliates inform the U.S. Bankruptcy Court for the Southern District of Florida that the interim termination date for the DIP Credit and Security Agreement, dated Jan. 29, 2008, as amended, has been extended to June 11, 2008. The termination date was originally set for May 23, 2008. Citicorp North America Inc. has committed to extend $650 million in postpetition financing to the Debtors. As reported in the Troubled Company Reporter on Feb 1, 2008, the Debtors received approval from the Court to immediately borrow $135 million to pay normal operating expenses, including employee wages, construction costs, and payments to suppliers. DIP Terms The DIP Credit Agreement provides for a total commitment of up to $650 million, consisting of: (a) a $130 million interim/permanent commitment, in the form of revolving credit loans and letters of credit; and (b) a $650,000,000 roll-up commitment made up of: -- a term loan tranche equal to $650 million multiplied by the term loan percentage of the first priority secured facilities; -- a letter of credit term loan tranche equal to the stated amount of outstanding letters of credit under the first priority revolver as of the roll- up date; and -- a revolving credit tranche equal to $650 million minus the sum of the amounts of (i) the term loan tranche plus (ii) the letter of credit term loan tranche. The facilities will mature on the earliest to occur of: (i) the date of the substantial consummation of a confirmed Reorganization Plan in the Chapter 11 cases; (ii) the scheduled termination date, which refers to: -- the date that is 60 days after the Interim Order is entered by the Bankruptcy Court, if the roll-up event does not occur and the final order is not entered by the Bankruptcy Court within 60 days after the interim order is entered; -- Dec. 31, 2008, if the roll-up event does not occur and the final order is entered with respect to the interim/permanent commitment within 60 days after the interim order is entered; or -- Dec. 31, 2008, if the roll-up date occurs; (iii) the date of the termination of the revolving credit commitments and letter of credit term loan commitments pursuant to optional prepayment or reduction of the loans in whole or in part; or (iv) the date on which the obligations become due and payable pursuant to acceleration. All letters of credit issued under the Revolving Credit Commitment will be issued by Citibank N.A., and will have an expiry date of no later than the earlier of (i) one year from the date of issuance or (ii) 15 days prior to the scheduled termination date. The Debtors will pay to the issuer a 0.25% issuance fee and to the lenders a letter of credit fee equal to 5.25% of the aggregate outstanding stated amount of each letter of credit, payable monthly in arrears. The Debtors may elect that the loans comprising each borrowing bear interest at a rate per annum equal to (i) the base rate plus the applicable margin, or (ii) the eurodollar rate -- subject to a floor of 3.25% -- plus the Applicable Margin: (i) at the Base Rate plus 4.25% per annum; or (ii) at the reserve adjusted Eurodollar Rate plus 5.25% per annum. If any event of default occurs and is continuing under the DIP facility, then the borrowers will pay interest on overdue amounts at a per annum rate 2% greater than the rate of interest specified. Interest on each base rate loan will be payable in arrears on the last day of each calendar month, upon prepayment, and at maturity. Interest on Eurodollar Rate Loans will be payable in arrears on the last day of each monthly interest period, upon the prepayment thereof, and at maturity. The DIP Obligations will be secured, subject to the carve-out, by a first priority, priming and senior security interest and lien not subject to subordination on all property and assets of the Debtors. About TOUSA Inc. Headquartered in Hollywood, Florida, TOUSA Inc. (Pink Sheets: TOUS) -- http://www.tousa.com/-- fka Technical Olympic U.S.A. Inc., dba Technical U.S.A., Inc., Engle Homes, Newmark Homes L.P., TOUSA Homes Inc. and Newmark Homes Corp. is a leading homebuilder in the United States, operating in various metropolitan markets in 10 states located in four major geographic regions: Florida, the Mid-Atlantic, Texas, and the West. TOUSA designs, builds, and markets high-quality detached single-family residences, town homes, and condominiums to a diverse group of homebuyers, such as "first-time" homebuyers, "move-up" homebuyers, homebuyers who are relocating to a new city or state, buyers of second or vacation homes, active-adult homebuyers, and homebuyers with grown children who want a smaller home. It also provides financial services to its homebuyers and to others through its subsidiaries, Preferred Home Mortgage Company and Universal Land Title Inc. The Debtor and its debtor-affiliates filed for separate Chapter 11 protection on Jan. 29, 2008. (Bankr. S.D. Fla. Case No.: 08-10928). The Debtors have selected M. Natasha Labovitz, Esq., Brian S. Lennon, Esq., Richard M. Cieri, Esq. and Paul M. Basta, Esq., at Kirkland & Ellis LLP and Paul Steven Singerman, Esq., at Berger Singerman to represent them in their restructuring efforts. Lazard Freres & Co. LLC is the Debtors' investment banker and financial advisor. Ernst & Young LLP is selected as the Debtors' independent auditor and tax services provider. Kurtzman Carson Consultants LLC acts as the Debtors' Notice, Claims & Balloting Agent. The Official Committee of Unsecured Creditors hired Patricia A. Redmond, Esq., and the law firm Stearns Weaver Weissler Alhadeff & Sitterson, P.A., as its local counsel. TOUSA Inc.'s financial condition as of Sept. 30, 2007, showed total assets of $2,276,567,000 and total debts of $1,767,589,000. Its consolidated detailed balance sheet as of Feb. 29, 2008 showed total assets of $1,961,669,000 and total liabilities of $2,278,106,000. TOUSA's Exclusive Plan Filing Period expires October 25, 2008. (TOUSA Bankruptcy News, Issue No. 14; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). TOUSA INC: Wants to Broaden Services of Auditor Ernst & Young ------------------------------------------------------------- TOUSA Inc. and its debtor-affiliates ask the U.S. Bankruptcy Court for the Southern District of Florida to expand the scope of services of their independent auditor and tax services provider, Ernst & Young LLP. The Debtors want Ernst & Young to provide services with respect to: (a) their state tax returns, nunc pro tunc to May 6, 2008; and (b) agreed upon procedures with respect to certain incentive bonus plan calculations, nunc pro tunc to May 19, 2008. The State Tax Compliance Services would require Ernst & Young, among other things, to: -- review, or prepare upon request, and sign of state tax returns for the year ended December 31, 2007; and -- prepare apportionment factors for state tax purposes for 2007. The Incentive Plan AUP Services include the performance of agreed-upon procedures under the attestation standards of the American Institute of Certified Public Accountants solely to assist in evaluating the achievement of a target award under the 2007 CEO Annual Incentive Bonus Plan, dated July 24, 2007, as of Dec. 31, 2007, Paul Steven Singerman, Esq., at Berger Singerman P.A., in Miami, Florida, relates. Ernst & Young will be paid by its hourly rates for the State Tax Compliance Services, and will be reimbursed for reasonable and necessary expenses incurred. The applicable hourly rates are the same rates for other tax services approved by the Original E&Y Retention Order: Nat'l. Exec. Director/Principal/Partner $700 to $925 Exec. Director/Principal/Partner $620 to $775 Manager/Senior Manager $450 to $700 Staff/Senior $180 to $360 Ernst & Young's fee with respect to the Incentive Plan AUP Services is fixed at $3,500. In addition, the firm will seek reimbursement for reasonable and necessary expenses incurred. About TOUSA Inc. Headquartered in Hollywood, Florida, TOUSA Inc. (Pink Sheets: TOUS) -- http://www.tousa.com/-- fka Technical Olympic U.S.A. Inc., dba Technical U.S.A., Inc., Engle Homes, Newmark Homes L.P., TOUSA Homes Inc. and Newmark Homes Corp. is a leading homebuilder in the United States, operating in various metropolitan markets in 10 states located in four major geographic regions: Florida, the Mid-Atlantic, Texas, and the West. TOUSA designs, builds, and markets high-quality detached single-family residences, town homes, and condominiums to a diverse group of homebuyers, such as "first-time" homebuyers, "move-up" homebuyers, homebuyers who are relocating to a new city or state, buyers of second or vacation homes, active-adult homebuyers, and homebuyers with grown children who want a smaller home. It also provides financial services to its homebuyers and to others through its subsidiaries, Preferred Home Mortgage Company and Universal Land Title Inc. The Debtor and its debtor-affiliates filed for separate Chapter 11 protection on Jan. 29, 2008. (Bankr. S.D. Fla. Case No.: 08-10928). The Debtors have selected M. Natasha Labovitz, Esq., Brian S. Lennon, Esq., Richard M. Cieri, Esq. and Paul M. Basta, Esq., at Kirkland & Ellis LLP and Paul Steven Singerman, Esq., at Berger Singerman to represent them in their restructuring efforts. Lazard Freres & Co. LLC is the Debtors' investment banker and financial advisor. Ernst & Young LLP is selected as the Debtors' independent auditor and tax services provider. Kurtzman Carson Consultants LLC acts as the Debtors' Notice, Claims & Balloting Agent. The Official Committee of Unsecured Creditors hired Patricia A. Redmond, Esq., and the law firm Stearns Weaver Weissler Alhadeff & Sitterson, P.A., as its local counsel. TOUSA Inc.'s financial condition as of Sept. 30, 2007, showed total assets of $2,276,567,000 and total debts of $1,767,589,000. Its consolidated detailed balance sheet as of Feb. 29, 2008 showed total assets of $1,961,669,000 and total liabilities of $2,278,106,000. TOUSA's Exclusive Plan Filing Period expires October 25, 2008. (TOUSA Bankruptcy News, Issue No. 14; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). TRIPLE CROWN: March 31 Balance Sheet Upside-Down by $58.6 Million ----------------------------------------------------------------- Triple Crown Media Inc.'s consolidated balance sheet at March 31, 2008, showed $48.0 in total assets, $89.3 million in total liabilities, and $17.3 million in Series A redeemable convertible preferred stock, resulting in a $58.6 million total stockholders' deficit. At March 31, 2008, the company's consolidated balance sheet also showed strained liquidity with $12.6 million in total current assets available to pay $31.2 million in total current liabilities. The company reported a net loss of $1.2 million, on operating revenues of $10.9 million, for the third quarter ended March 31, 2008, compared with a net loss of $575,000, on operating revenues of $11.2 million for the same period ended March 31, 2007. "We are extremely pleased that EBITDA for the quarter ended March 31, 2008, increased to $1.9 million from $1.1 million for the comparable quarter of the prior year, an increase of approximately $800,000. Year to date EBITDA increased to $6.9 million from $6.4 million for the comparable quarter of the prior year, an increase of approximately $500,000. "Our publishers and employees have worked extremely hard to maximize revenue and control expenses in our current environment. The newspaper industry is experiencing declines in automotive, help wanted and real estate advertising and the economy as a whole appears to be softening" said Robert S. Prather, Jr., president and chief executive officer of Triple Crown Media Inc. 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?2d66 About Triple Crown Headquartered in Lawrenceville, Georgia, Triple Crown Media Inc. (Nasdaq: TCMI) -- http://triplecrownmedia.com/-- owns and operates six daily newspapers and one weekly newspaper in Georgia. TROPICANA ENTERTAINMENT: Court Final OKs $67 Million DIP Financing ------------------------------------------------------------------ Judge Kevin J. Carey of the U.S. Bankruptcy Court for the District of Delaware authorized Tropicana Entertainment LLC and its debtor- affiliates, to obtain, on a final basis, up to $67,000,000, of bankruptcy financing under a Senior Secured Superpriority Debtor- in-Possession Credit Agreement, dated May 5, 2008, with a group of lenders led by Silver Point Finance LLC, as administrative agent. The Loan Proceeds will be used to pay the Debtors' expenses and make debt payments provided that those expenditures are permitted under the DIP Budget and do not exceed the amounts permitted under the Amended DIP Facility filed with the Court May 30, 2008. The Amended DIP Facility provides that the permitted aggregate amount of the Debtors' capital expenditure should not exceed these amounts: Month Ending On Amount --------------- ---------- May 31, 2008 $3,100,000 June 30, 2008 $6,200,000 July 31, 2008 $8,100,000 August 31, 2008 $9,600,000 September 30, 2008 $11,100,000 October 31, 2008 $12,400,000 November 30, 2008 $14,000,000 December 31, 2008 $16,000,000 January 31, 2009 $18,000,000 February 28, 2009 $20,000,000 March 31, 2009 $22,000,000 April 30, 2009 $24,000,000 A full-text copy of the Amended DIP Facility is available for free at: http://bankrupt.com/misc/Tropicana_RedlinedDIPcreditAgreement.pdf Objections filed by the Official Committee of Unsecured Creditors and the ad hoc consortium of holders of 9-5/8% of Senior Subordinated Notes have been consensually resolved, and subsequently withdrawn. The Court overruled all other objections that have not been resolved or withdrawn on their merits. All DIP Obligations under the Silver Point DIP Facility constitute allowed superpriority administrative expense claims against each of the Debtors and will have priority over all of the Debtors' administrative expenses, subject only to: (i) the Carve-Out; and (ii) the superpriority claim granted to Credit Suisse and certain other lenders with respect to a Prepetition Credit Facility the Credit Suisse Lenders extended in January 2007 to Debtors Tropicana Las Vegas Resort and Casino LLC and Tropicana Las Vegas Holdings, LLC -- the LandCo Debtors. The "Carve-Out" refers to (i) unpaid fees of the Clerk of the Bankruptcy Court and the U.S. Trustee, (ii) unpaid and allowed fees and expenses of professional persons retained by the Debtors and any Committee and the unpaid and allowed reasonable expenses of members of the Committee, and (iii) unpaid and allowed fees and expenses of professionals, in an aggregate amount not to exceed $10,000,000. The Carve-Out Cap with respect to the DIP Lenders Lenders is $2,500,000, and the Carve-Out Cap with respect to the Lenders is $7,500,000. As security for the DIP Obligations, Silver Point, as the DIP Collateral Agent, is granted valid, binding, enforceable, first priority and perfected Liens in substantially all of the Debtors' assets, including proceeds of any avoidance actions under Chapter 5 of the Bankruptcy Code. The "Collateral" Assets under the DIP Facility does not include the assets relating to Tropicana Atlantic City or Ramada New Jersey Holdings Corporation, Columbia Properties Vicksburg LLC, Evansville Mall or Manchester Mall or assets relating to Aztar Indiana Gaming Company LLC, or the Atlantic City Facility. The DIP Lenders will have no liens on the proceeds of any asset sale of Atlantic City, Vicksburg or Evansville Mall/Manchester Mall. The DIP Facility will terminate on the earlier of: (i) the Effective Date of a Chapter 11 plan confirmed in the Debtors' cases; (ii) September 5, 2009; or (iii) the date on which all Loans become due and payable in full. A full-text copy of the 49-page Final DIP Order is available for free at: http://bankrupt.com/misc/Tropicana_FinalDIPorder.pdf 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 represents 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. 8; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) TROPICANA ENT: Obtains Final OK to Access LandCo's Cash Collateral ------------------------------------------------------------------ Tropicana Entertainment LLC and its debtor-affiliates obtained final approval from the U.S. Bankruptcy Court for the District of Delaware to use the LandCo Lenders' Cash Collateral. The Debtors' secured indebtedness consists of two senior secured financing facilities aggregating $1,740,000,000 -- one of which is a $440,000,000 secured financing facility that is secured by substantially all of the assets of seven Debtors, including cash collateral. The LandCo Credit Agreement is by and among Debtor Tropicana Las Vegas Resort and Casino LLC, as borrower; certain other Debtors, as guarantors; and Credit Suisse, Cayman Islands Branch, as sole administrative agent and collateral agent. The LandCo Debtors include Adamar of Nevada Corporation; Hotel Ramada of Nevada Corporation; Tropicana Las Vegas Holdings LLC; Tropicana Development Company LLC; Tropicana Enterprise Partnership; Tropicana Las Vegas Resort and Casino LLC; and Tropicana Real Estate Company LLC. In addition, Debtors Tropicana Entertainment LLC, and Tropicana Finance Corporation issued approximately $960,000,000 in unsecured notes, which are guaranteed by certain Debtors. The Debtors will use the LandCo Cash Collateral as working capital for the continuation of the operation of their businesses. The LandCo Lenders have agreed to permit the LandCo Debtors to use the Cash Collateral from the bankruptcy filing date through the Termination Date or a date on which any Event of Default will have occurred and be continuing beyond any applicable grace period. The LandCo Debtors are not authorized to, and will not, use any of the approximately $34,900,000, plus any accrued interest, deposited with the Bank of America, Account No. 005011657845, for any purpose other than payment of Adequate Protection Payments. The LandCo Lenders are entitled to adequate protection of their interest in the LandCo Collateral, the Court rules. As security for the Adequate Protection Obligations, the LandCo Agent is granted a valid and perfected replacement security interest in substantially all of the LandCo Debtors' assets, excluding the LandCo Debtors' avoidance actions and claims. The LandCo Lenders are granted: (a) a first priority perfected lien on all of the bankruptcy Collateral that is not otherwise encumbered by a validly perfected, non-avoidable security interest or lien as of the Petition Date; (b) a first priority, senior and perfected lien on (x) the portion of the bankruptcy Collateral that comprises the LandCo Collateral and is not subject to a validly perfected lien or security interest with priority over the LandCo Agent's liens on the LandCo Collateral as of the bankrupcy filing Date, and (y) bankruptcy Collateral subject to a lien that is junior to the liens securing the LandCo Obligations; and (c) a second priority, junior perfected lien on all bankruptcy Collateral that is subject to a validly perfected lien with priority over the LandCo Agent's liens as of the bankruptcy filing date. On account of the Adequate Protection Obligations, the Debtors agreed to pay the LandCo Agent (i) all unpaid interest on the LandCo Obligations at the rates applicable immediately before the bankruptcy filing date, and (ii) all other accrued and unpaid fees and disbursements, including the fees and expenses of the LandCo Lenders' and Agent's professionals. The Debtors will also pay the LandCo Agent: -- on the 15th day of each month, all accrued but unpaid interest on the LandCo Obligations (x) until June 30, 2008, at the Adjusted LIBO Rate plus 2.25% per annum, and (y) thereafter, at the Alternate Base Rate plus 1.25% per annum; and -- on the 15th of each month, an amount equal to Alternate Base Rate plus 2.0% per annum on the unpaid portion of the Hedge Claim in favor of the Hedge Counterparty. The Debtors' use of the Cash Collateral will terminate on, among other things:, -- the failure of the Debtors to make any Adequate Protection Payment, Collateral Payment or other payment to the LandCo Agent and LandCo Lenders; -- the entry of a Court order lifting the automatic stay to permit a security interest holder to foreclose on any assets of the LandCo Debtors, which assets have an aggregate value of more than $5,000,000; and -- any material License Revocation with respect to the LandCo Debtors. Notwithstanding anything contrary in the Final Cash Collateral Order or any other Court order, no Cash Collateral, bankrupcty collateral or Carve-Out may be used to, among other things: -- object, contest or raise any defense to, the validity, perfection, priority, extent or enforceability of any amount due under the Agreements, or the liens or claims granted; -- assert any Claims or Defenses or causes of action against Credit Suisse or the LandCo Lenders or their agents, affiliates, representatives, attorneys or advisors; or -- pay any amount on account of any claims arising before the bankruptcy filing date unless those payments are approved by Court orderprepetition. Any objections to the Cash Collateral Use that have not been resolved or withdrawn are overruled on their merits. A full-text copy of the Final LandCo Cash Collateral Order is available for free at: http://bankrupt.com/misc/Tropicana_FinalLandCoOrder.pdf 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 represents 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. 8; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) TROPICANA ENT: Court OKs Access to OpCo Lenders' Cash Collateral ---------------------------------------------------------------- Judge Kevin J. Carey of the U.S. Bankruptcy Court for the District of Delaware authorized, on a final basis, Tropicana Entertainment LLC and its debtor-affiliates to use the Cash Collateral of the OpCo Lenders under a Credit Agreement dated January 2007. January 2007 agreement was between Tropicana Entertainment LLC, Wimar Opco Intermediate Holdings LLC, CP Laughlin Realty LLC, Columbia Properties Vicksburg LLC and JMBS Casino LLC -- the OpCo Debtors -- and Credit Suisse and certain other lenders. Mark D. Collins, Esq., at Richards Layton & Finger P.A., in Wilmington, Delaware, the Debtors' counsel, related that the Debtors' secured indebtedness consists of two senior secured financing facilities: * A $1.3 billion secured financing facility, secured by substantially all of the assets of the OpCo Debtors, including "cash collateral" as defined in Section 361 of the Bankruptcy Code; and * A $440 million secured financing facility, secured by substantially all of the assets of the LandCo Debtors. The Debtors' authority to use the OpCo Lenders' Cash Collateral on a consensual basis will automatically terminate on a occurence of a "Termination Event" without further Court order. The Court reserves the Debtors' rights to seek authorization to use the OpCo Prepetition Lenders' Cash Collateral after a Termination Event. The Court also reserves the rights of Credit Suisse, as collateral agent for the OpCo Lenders, to object to that request for authorization. The OpCo Cash Collateral may be used to pay the reasonable allowed fees and expenses of professionals retained by the Official Committee of Unsecured Creditors incurred in connection with investigating, but not initiating or prosecuting any claims and defenses against Credit Suisse, the OpCo Lenders or any Released Party. The OpCo Agent may file a master proof of claim against the Debtors, on behalf of itself and the applicable OpCo Lenders on account of their corresponding claims arising under certain Financing Documents prior to bankruptcy filing. To serve as adequate protection for the Debtors' Obligation, the OpCo Agent is granted a valid and perfected replacement security interest in, and lien on, the Collateral, other than Collateral owned by certain Debtors, including Tropicana Las Vegas Resort and Casino LLC formerly known as Wimar LandCo LLC, in relation to a Prepetition Credit Agreement the LandCo Debtors entered into with Credit Suisse and certain other lenders in January 2007. As adequate protection payment to the OpCo Lenders, the Debtors agreed pay the OpCo Agent: -- all accrued and unpaid interest on the OpCo Obligations at the rates applicable immediately before the bankruptcy filing date under a certain Forbearance Agreement, all accrued and unpaid letter of credit fees at the rate applicable immediately before the Petition Date under the OpCo Credit Agreement, and all other accrued and unpaid fees and disbursements, including the fees and expenses incurred by the OpCo Lenders' professionals, owing to the OpCo Agent under the OpCo Financing Documents and incurred before the bankruptcy filing date; -- all reasonable and documented fees and expenses payable to the OpCo Agent and the OpCo Lenders' counsel, financial advisors and other consultants; and -- on the first business day of each month, (x) all accrued but unpaid interest on the OpCo Obligations at the Alternate Base Rate plus 3.25% per annum, and (y) in the form of cash payments equal to letter of credit and other fees at the contract rates applicable on the Petition Date under the OpCo Financing Documents. 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 represents 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. 8; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) TROPICANA ENTERTAINMENT: Sets up New Board to Restructure Business ------------------------------------------------------------------ Tropicana Entertainment Holdings LLC has created a new board of directors to help restructure the company and shape its long term strategy. The five-member board is made up of three outside directors; company president Scott C. Butera, who has been named CEO and will report to the board; and William J. Yung, who stepped down as CEO this week but remains on the board. The new outside directors are executives with substantial financial restructuring and regulatory experience. They include merchant banker Thomas M. Benninger; former Metro Goldwyn Mayer CFO Michael G. Corrigan; and former New Jersey Casino Control Commission Chairman and CEO Bradford S. Smith, Esq. The new board is expected to form independent audit and litigation committees well as a gaming regulatory compliance committee. It also will consider moving Tropicana Entertainment's corporate headquarters to Las Vegas, Nevada. "Forming an independent board of directors is a critical first step in our planned restructuring," Mr. Butera said. "There is no question that the company's operations will benefit tremendously from the collective experience of our new directors. We are looking forward to working with them as we look to invest in our assets and employees and revitalize the historic Tropicana brand." Mr. Butera joined Tropicana Entertainment in March 2008 to lead the effort to improve the company's capital structure. He is the former chief operating officer of the Cosmopolitan Resort and Casino in Las Vegas, Nevada. Prior to that he was President, chief operating officer and executive vice president of Trump Hotels & Casino Resorts Inc., where he was the principal architect of the development and implementation of that company's successful recapitalization plan. Mr. Benninger is a founding managing general partner of Global Leveraged Capital, a private merchant banking firm that pursues proprietary origination of leveraged corporate debt, distressed debt and minority equity investments. Mr. Benninger has extensive financial and audit and restructuring experience at a variety of financial institutions, including UBS Investment Bank, Donaldson, Lufkin and Jenrette, Arthur Andersen & Co. and Smith Barney. Mr. Benninger received both his Bachelor of Arts in Economics and Masters of Business degrees from Stanford University. Mr. Corrigan is a media and entertainment executive with experience in operations, strategic planning and finance. He served as co-founder and partner of Shelbourne Capital Partners LLC, a boutique financial advisory firm. He is a former CFO of Metro Goldwyn Mayer Inc. He serves as a director of ACME Communications Inc. and had been chairman of the board of directors for Atari Inc. Mr. Corrigan is a graduate of the Law School of Trinity College, Dublin, Ireland. Mr. Smith is a gaming and regulatory consultant who served as chairman of the New Jersey Casino Control Commission. A former State Senator, Mr. Smith was chairman of both the judiciary and law and public safety committees of the New Jersey State Senate. He sits on the Mt. Airy Casino Resort Independent Audit Committee and the Burlington County board of Chosen Freeholders. Mr. Smith earned his law degree from Duquesne University in Pittsburgh and is a member of the New Jersey Bar. 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. TS PRINTING: Voluntary Chapter 11 Case Summary ---------------------------------------------- Debtor: TS Printing Company Inc 8000 Sovereign Row Suite A Dallas, TX 75247 Tel: (214) 631-7777 Bankruptcy Case No.: 08-32760 Chapter 11 Petition Date: June 3, 2008 Court: Northern District of Texas (Dallas) Debtors' Counsel: Hanh H. Duong, Esq. Duong and Associates, PLLC 1204 N. Josey Lane, Suite 106 Carrollton, TX 75006 Tel: (214)390-0999 Fax: (214)390-0998 E-mail: duonglawfirm@yahoo.com Total assets: $6,321,977 Total debts: $6,855,463 A copy of the Debtor's petition and schedules of assets and liabilities is available at no charge at: http://bankrupt.com/misc/txnb08-32760.pdf The Debtor did not file a list of its 20 largest unsecured creditors. TUCSON ELECTRIC: S&P Revises Outlook to Positive from Stable ------------------------------------------------------------ Standard & Poor's Ratings Services revised the rating outlook on Tucson Electric Power Co. to positive from stable. Ratings on the company, including the 'BB' corporate credit rating, were affirmed. "The outlook revision reflects the potential for ratings improvement if the settlement in TEP's rate case is approved by the Arizona Corporation Commission," said Standard & Poor's credit analyst Anne Selting. Filed May 29 with the Arizona Corporation Commission, the proposed settlement resolves how TEP's retail rates are regulated going forward; provides for a rate increase that should allow the company to stabilize cash flows at modestly stronger levels beginning in 2009; and, importantly, eliminates TEP's significant exposure to unplanned outages and escalation of fuel and purchased power costs, neither of which the Tucson-based utility can currently recover in rates, which are frozen under its 1999 settlement. The settlement has been set for hearings in early July and will require an ACC vote, which has not been scheduled. Standard & Poor's would note that while modest improvements in cash flow metrics are expected, they may not occur until after 2009 if the ACC requires TEP to rebate competitive transition charges it is collecting in 2008. Clouding the expectation that the company's credit profile is on a positive trajectory are immediate concerns as to how much cash flow from operations will be suppressed by high gas and power prices that are stressing TEP's gross margins. S&P currently expect the effects to be manageable. However, a protracted summer outage that results in materially weakened cash flow metrics could return the company to a stable outlook, as could an ACC decision that substantially modifies the terms of the proposed settlement. UBS AG: Will Exit Municipal Bond Business and Eliminate 280 Jobs ---------------------------------------------------------------- UBS AG is closing its municipal bond business after failing to find a buyer for what was the third-largest underwriter of U.S. state and local government debt last year, the Bloomberg reports. Bloomberg, citing Doug Morris, a spokesperson in Zurich-based UBS, says that UBS will fire about 280 people and would shutter its municipal bond division if it couldn't find a buyer. In a press statement, UBS stated that it will close its Investment Bank's institutional municipal securities business through an orderly wind-down. UBS Wealth Management Americas will continue to be a provider of municipal securities products to private clients by assuming responsibility for secondary trading efforts, introducing an open architecture platform for new issues and expanding its municipal research team. The exit of the institutional municipal securities business is part of UBS's ongoing efforts to reposition its Fixed Income, Currencies and Commodities business to focus on core business areas. UBS explored a number of alternatives to exit the institutional municipals business and determined that because of the complexities of selling the business in the market and limited market capacity for a business of this size, a sale of the business was unlikely in the near term. After the exit of the institutional municipals business, UBS will no longer offer underwriting and structuring services to municipal clients. The firm's municipal securities secondary market trading business will be transferred from UBS Investment Bank into UBS Wealth Management Americas in order to facilitate the trading of municipal securities for private clients. "Municipal securities are an important part of many of our clients' portfolios," Jim Hausmann, Head of Transaction Products, UBS Wealth Management Americas, said. "With this integration, our clients will benefit from an increased number of people dedicated specifically to their municipal securities needs. Through an open architecture platform, our clients will have access to a broad of supply of both new issues and secondary securities." UBS will begin to work with its municipal clients to transfer their business in an orderly fashion and expects to complete the exit from the institutional municipals business over the next few months. About UBS AG UBS AG (NYSE:UBS) -- http://www.ubs.com/-- together with its subsidiaries, provides a range of financial products and services worldwide. UBS' businesses are Global Wealth Management and Business Banking, Global Asset Management, and Investment Banking. The company was founded in 1862 and is based in Zurich, Switzerland. UBS employs more than 80,000 people around the world. Its Wealth management services in the United States are provided by UBS Financial Services Inc. UBS' U.S. headquarters is at 1285 Avenue of the Americas, New York City. VONAGE HOLDINGS: Settles Patent-Infringement Suit by Web Telephony ------------------------------------------------------------------ Vonage Holdings Corp. has settled a patent-infringement suit by Illinois company Web Telephony LLC over a Web-controlled telephone system, Bloomberg News reports. Details weren't released. According to the report, Vonage spokesman Charles Sahner said in an e-mail confirming the settlement, that the agreement ends the last intellectual property suit against the company. Vonage spent a total of $240 million to settle claims by rivals Sprint Nextel Corp., Verizon Communications Inc. and AT&T Inc. The case is Web Telephony LLC v. Verizon Communications Inc., 07cv85, filed the federal court in Marshall, Texas. About Vonage Holdings Corp. Headquartered in Holmdel, New Jersey, Vonage Holdings Corp. (NYSE:VG) -- http://www.vonage.com/-- provides broadband telephone services with nearly 2.6 million subscriber lines. The company's Residential Premium Unlimited and Small Business Unlimited calling plans offer consumers unlimited local and long distance calling, and features like call waiting, call forwarding and voicemail for a flat monthly rate. Vonage's service is sold on the web and through national retailers including Best Buy, Circuit City, Wal-Mart Stores Inc. and Target and is available to customers in the U.S., Canada and the United Kingdom. Going Concern Doubt BDO Seidman, LLP, in Woodbridge, New Jersey, raised substantial doubt as to Vonage Holdings Corp.'s ability to continue as a going concern after auditing the company's consolidated financial statements for the years Dec. 31, 2007, and 2006. As reported by the Troubled Company Reporter on May 12, 2008 that Vonage Holdings's balance sheet at March 31, 2008, showed $458.3 million in total assets and $540.5 million in total liabilities, resulting in an $82.2 million stockholders' deficit. WACHOVIA BANK: S&P Puts Five Low-B Ratings Under Negative Watch --------------------------------------------------------------- Standard & Poor's Ratings Services placed its ratings on five classes of commercial mortgage pass-through certificates from Wachovia Bank Commercial Mortgage Trust's series 2005-C17 on CreditWatch with negative implications. The CreditWatch placements reflect Standard & Poor's preliminary analysis of two assets totaling $71.5 million (3% of the pool balance) that are currently with the special servicer, CWCapital Asset Management LLC, as well as concerns about several loans in the trust that reported debt service coverage below 1.0x. Details of the specially serviced assets are: -- Cabrillo Apartments is a 369-unit multifamily property in San Diego, California, with a total exposure of $43.7 million, including servicing advances and interest thereon. The interest-only loan was transferred to the special servicer in April 2008 due to imminent default and is now 60-plus-days delinquent. The property reported a 2007 DSC of 1.38x. -- Sterling University Vista Apartments is a 318-unit multifamily property in Dallas, Texas, with an unpaid principal balance of $27.8 million. The loan was transferred to the special servicer in February 2008 following the borrower's request for a loan modification. As of Sept. 30, 2007, the reported DSC was 0.64x. Standard & Poor's will update or resolve the CreditWatch negative placements following its analysis of the specially serviced assets and the loans with reported DSCs below 1.0x. Ratings Placed on Creditwatch Negative Wachovia Bank Commercial Mortgage Trust Commercial mortgage pass-through certificates series 2005-C17 Rating ------ Class To From Credit enhancement ----- -- ---- ------------------ K BB/Watch Neg BB 2.77% L BB-/Watch Neg BB- 2.25% M B+/Watch Neg B+ 1.98% N B/Watch Neg B 1.72% O B-/Watch Neg B- 1.45% WELLMAN INC: Lenders Further Defer Deadline for Bid Protocol OK --------------------------------------------------------------- Wellman, Inc. disclosed that the lenders providing its DIP financing have granted the company an additional one week extension until June 26, 2008 to have bidding procedures approved by the U.S. Bankruptcy Court for the Southern District of New York. All other terms of the DIP financing remain the same. The company, in consultation with its stakeholders, is continuing to evaluate proposals and restructuring alternatives, including a plan of reorganization, in an effort to maximize the value of Wellman's business on a going concern basis. This extension will provide Wellman with additional time to continue discussions with stakeholders and interested parties to develop the terms of a plan of reorganization. "We are encouraged by the progress we have made," Mark Ruday, Wellman's Chief Executive Officer stated. "During the next week, we expect to amend our DIP facility so that it permits us to file a plan of reorganization in June. We expect to have the plan confirmed and to emerge from bankruptcy later this year. Our first and second lien debt holders have each expressed interest in having a prominent role in our plan of reorganization. We appreciate the support that the DIP lenders have provided. This has enabled us to work towards a plan of reorganization which we believe is the most attractive alternative for Wellman's stakeholders including its customers, suppliers and employees." 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 led by 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. Headquartered in Fort Mill, South Carolina, Wellman Inc. ([OTC]: WMANQ.OB) -- 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. WILLIAM DEL BIAGGIO: Files for Chapter 11 Amid Loan Fraud Charges ----------------------------------------------------------------- William "Boots" Del Biaggio III filed a petition for chapter 11 bankruptcy protection Friday before the U.S. Bankruptcy Court for the Northern District of California, two weeks after being accused of loan fraud, The Associated Press and San Jose (Calif.) Mercury News report. Sand Hill Capital Partners III, the investment fund Mr. Del Biaggio co-founded, filed for chapter 7 bankruptcy, reports say. The AP, citing court documents, says Mr. Del Biaggio, 40, has at least $57,000,000 in unpaid personal and business loans, credit card bills and other financial obligations. Sand Hill disclosed $10.6 million in debts, according to AP. Mr. Del Biaggio stepped down from Sand Hill Capital late in May. According to the reports, Mr. Del Biaggio is facing charges for roughly $17,000,000 in the aggregate from lenders. AP says Modern Bank, a New York-based private bank, is trying to force Mr. Del Biaggio to repay $10,000,000 he used to help buy his stake of the Nashville Predators of the National Hockey League. Mercury News saays Mr. Del Biaggio put in 27% of the $193,000,000 raised by an investor group that acquired the team in November 2007. AP continues that Heritage Bank of Commerce, a San Jose-based bank co-founded by Mr. Del Biaggio's father, has demanded that Mr. Del Biaggio immediately repay a $4,000,000 loan. DGB Investments Inc., a San Jose-based investment firm, is suing Mr. Del Biaggio over an unpaid $3 million loan, adds AP. The reports say those transactions and others are subject to an investigation by the U.S. Attorney's Office in San Francisco, and the Securities and Exchange Commission over allegations that Mr. Del Biaggio faked the collateral for the loans. Canada's The National Post says Mr. Del Biaggio tried to sell his stake in the Nashville Predators days before the lawsuits were filed. Unnamed sources told the National Post that NHL officials opposed the deal. The Post says Mr. Del Biaggio was in talks with Jim Balsillie, co-CEO of Blackberry-creator Research in Motion Ltd. According to the report, a tentative deal had been worked out that would have paid a "significant premium" above the estimated $30,000,000 book value for Mr. Del Biaggio's combined 1/3 interest in the hockey team. Mercury News says Sand Hill Capital has indicated that Mr. Del Biaggio's investment fund has nothing to do with Sand Hill Capital and that Mr. Del Biaggio has no right to use its name. Established in 1996, Sand Hill Capital has four debt funds under management, of which two are actively investing. Sand Hill has provided debt financing and equity co-investing in multiple portfolio companies of top-tier venture capital firms, including Broadcom, a semiconductor company specializing in VoIP, wireless networking, and broadband communications solutions; Commerce One, a provider of On-Demand Supplier Relationship Management solutions and The Open Supplier Network; IBahn, a provider of secure broadband-to-go at premium hospitality locations; and Odwalla, maker of fruit drinks and snacks. XERIUM TECHNOLOGIES: Moody's Affirms Caa1 Corp. Family Rating ------------------------------------------------------------- Moody's Investors Service revised Xerium Technologies, Inc.'s outlook to positive from negative, upgraded its speculative grade liquidity rating to SGL-3 from SGL-4, and upgraded its probability of default rating to Caa1 from Caa2. The rating action reflects the company's recent amendment to its credit agreement on May 30, 2008, the completion of its goodwill impairment test, and the recent filing of its delinquent financial statements. Under the new amendment, credit agreement covenant compliance becomes more certain as financial covenants have been loosened. As a result, Moody's believes that over the next twelve months Xerium will possess adequate liquidity and likely comply with its financial covenants. At the same time, Xerium will likely rely on its revolving credit facility as it remains unclear if the company can cover all cash requirements from internal sources with the burden posed by the increased debt service. All other ratings have been affirmed. Although the short-term liquidity profile has improved, the affirmation of the Caa1 corporate family rating reflects Moody's belief that Xerium's operating performance may remain weak. Xerium's customers face challenges operationally due to a slowdown in global paper production and significant overcapacity, especially in newsprint and fine paper. Moody's believes the recent $185 million goodwill impairment charge within the roll covers segment is a indication of the challenges that lay ahead for the industry. Therefore, it is likely these trends will continue with the closure of additional mills and further downtime at existing facilities in Xerium's primary markets of North America and Europe. Moody's also anticipates that previous volume losses will take longer than expected to recover and that recent investments in developing economies will take several years before they have a meaningful positive impact on cash flow. Xerium's elevated business risk due to its longer term liquidity profile, high debt levels, limited product diversity with focus on the paper industry, and potential for restructuring and plant closures constrain the ratings. Going forward, Moody's believes Xerium will continue to face the risk of further rationalization in North American paper production capacity and a sustained decline in global paper production. The last rating occurred on March 20, 2008, when Moody's downgraded the long-term debt ratings to Caa1 from B2 due to the company's expectation that it would be non-compliant with its financial covenants in the first quarter of 2008 and future periods without an amendment to its credit facility. Affirmations: Issuer: Xerium Technologies, Inc. * Corporate Family Rating at Caa1; * Senior Secured Term Loan at Caa1 (LGD3, 46%); * Senior Secured Revolving Credit Facility at Caa1 (LGD3, 46%) Upgrades: Issuer: Xerium Technologies, Inc. * Speculative Grade Liquidity Rating, Upgraded to SGL-3 from SGL-4; * Probability of Default Rating, Upgraded to Caa1 from Caa2 Outlook Actions: Issuer: Xerium Technologies, Inc. * Outlook, Changed To Positive from Negative Xerium Technologies, Inc., headquartered in Youngsville, NC, is a manufacturer and supplier of consumable products used primarily in the production of paper. ZACHARIA LAMAR: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Zacharia Lamar Rhoads fdba Auto Rama fdba Auto Rama, L.L.C. 3048 North 5100 East Eden, UT 84310 Bankruptcy Case No.: 08-23284 Chapter 11 Petition Date: May 22, 2008 Court: District of Utah (Salt Lake City) Debtor's Counsel: Anna W. Drake, Esq. 175 South Main Street, Suite 1250 Salt Lake City, UT 84111 Tel: (801) 328-9792 Fax: (801) 530-5955 E-mail: annadrake@att.net Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Debtor's 20 largest unsecured creditors is available for free at http://bankrupt.com/misc/utb08-23284.pdf * S&P Cuts Ratings on 76 Classes of Certs. from 17 US ALT-A RMBS ---------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on 76 classes of mortgage pass-through certificates from 17 U.S. Alternative-A residential mortgage-backed securities transactions issued by Alternative Loan Trust, American Home Mortgage Investment Trust, Deutsche Mortgage Securities Inc. Mortgage Loan Trust, DSLA Mortgage Loan Trust, Homestar Mortgage Acceptance Corp., Impac CMB Trust, IndyMac INDX Mortgage Loan Trust, Lehman XS Trust, Structured Asset Securities Corp., and Terwin Mortgage Trust. S&P removed one of the lowered ratings from CreditWatch with negative implications. At the same time, S&P affirmed its ratings on two classes from Deutsche Alt-A Securities Inc. Mortgage Loan Trust and removed them from CreditWatch negative. The rating on one class from Structured Asset Securities Corp. remains on CreditWatch negative. In addition, S&P affirmed its ratings on 386 other certificates from various Alt-A transactions. All of the affected transactions were issued between 2002 and 2005. The lowered ratings reflect current or projected credit enhancement levels that are not sufficient to support the certificates at their previous rating levels as of the May 2008 remittance period. Based on the current collateral performance of these transactions, future credit enhancement is projected to be significantly less than the original credit support. S&P have reviewed all of the affected transactions within the past 12 months, and they continue to perform adversely. The affirmations reflect sufficient credit support percentages to support the current ratings as of the April 2008 remittance period. The underlying collateral for all of the affected classes consists primarily of Alt-A mortgage loans. Ratings Lowered Alternative Loan Trust 2005-J1 Series 2005-J1 Rating ------ Class CUSIP To From ----- ----- -- ---- B-4 12667FV85 CCC B American Home Mortgage Investment Trust 2004-4 Series 2004-4 Rating ------ Class CUSIP To From ----- ----- -- ---- M-2 02660TCV3 BBB A M-3 02660TCW1 CCC BBB American Home Mortgage Investment Trust 2005-1 Series 2005-1 Rating ------ Class CUSIP To From ----- ----- -- ---- M-2 02660TDN0 A AA M-3 02660TDP5 BB AA- M-4 02660TDQ3 B A M-5 02660TDR1 CCC A- M-6 02660TDS9 CCC BBB+ M-7 02660TEE9 CCC BBB M-8 02660TEF6 CC BBB- B 02660TEG4 CC BB VIII-M-3 02660TDV2 BB A- VIII-M-4 02660TDW0 B BBB+ VIII-M-5 02660TDX8 CCC BBB VIII-M-6 02660TDY6 CC BBB- Deutsche Mortgage Securities Inc Mortgage Loan Trust Series 2004-5 Series 2004-5 Rating ------ Class CUSIP To From ----- ----- -- ---- M-2 251563GE6 BBB A+ M-3 251563GF3 CCC BBB+ DSLA Mortgage Loan Trust 2004-AR2 Series 2004-AR2 Rating ------ Class CUSIP To From ----- ----- -- ---- B-2 23332UAX2 BBB A+ B-3 23332UAY0 B BBB B-4 23332UAZ7 CCC BB B-5 23332UBA1 CC B DSLA Mortgage Loan Trust 2005-AR2 Series 2005-AR2 Rating ------ Class CUSIP To From ----- ----- -- ---- B-3 23332UDH4 B BBB B-4 23332UDJ0 CCC B B-5 23332UDM3 CC CCC DSLA Mortgage Loan Trust 2005-AR3 Series 2005-AR3 Rating ------ Class CUSIP To From ----- ----- -- ---- B-1 23332UDY7 BBB AA B-2 23332UDZ4 B A B-3 23332UEA8 CCC BBB B-4 23332UEB6 CCC BBB- B-5 23332UEC4 CC B B-6 23332UED2 CC CCC Homestar Mortgage Acceptance Corp. Series 2004-6 Rating ------ Class CUSIP To From ----- ----- -- ---- M-5 437690CP3 BBB A- M-6 437690CQ1 BB BBB+ M-8 437690CS7 CCC B Impac CMB Trust Series 2005-5 Series 2005-5 Rating ------ Class CUSIP To From ----- ----- -- ---- M-3 45254NQA8 BBB AA- M-4 45254NQB6 BB A+ M-5 45254NQC4 B A M-6 45254NQD2 CCC A B 45254NQE0 CCC A- Impac CMB Trust Series 2005-7 Series 2005-7 Rating ------ Class CUSIP To From ----- ----- -- ---- M-3 45254NRB5 BBB A+ M-4 45254NRC3 BB A M-5 45254NRD1 B A- M-6 45254NRE9 CCC BB+ B 45254NRF6 CC B IndyMac INDX Mortgage Loan Trust 2005-AR18 Series 2005-AR18 Rating ------ Class CUSIP To From ----- ----- -- ---- B-5 45660LWN5 BB+ A- B-6 45660LWP0 BB BBB+ B-7 45660LWQ8 BB- BBB B-8 45660LWR6 B BBB- B-9 45660LWX3 CCC BB B-10 45660LWY1 CC B Lehman XS Trust Series 2005-4 Rating ------ Class CUSIP To From ----- ----- -- ---- 2-M2 525221CR6 BB A 2-M3 525221CS4 B BBB- Lehman XS Trust Series 2005-8 Rating ------ Class CUSIP To From ----- ----- -- ---- 1-M1 525221DV6 BBB AA- 1-M2 525221DW4 BB A- 1-M3 525221DX2 B BB 1-M5 525221DZ7 CC CCC 2-M4 525221EK9 BBB A- 2-M5 525221EL7 B BBB 2-M6 525221FL6 CCC BB Lehman XS Trust Series 2005-10 Series 2005-10 Rating ------ Class CUSIP To From ----- ----- -- ---- 1-M1 525221FS1 BBB AA 1-M2 525221FT9 B A- 1-M3 525221FU6 CCC BB 1-M4 525221FV4 CC CCC 2-M3 525221GJ0 BB A 2-M4 525221GK7 B BBB 2-M5 525221GL5 CCC BB Structured Asset Securities Corp. Series 2003-36XS Rating ------ Class CUSIP To From ----- ----- -- ---- M2 86359BAX9 B BBB M3 86359BAY7 CC CCC Structured Asset Securities Corp. Series 2004-6XS Rating ------ Class CUSIP To From ----- ----- -- ---- M2 86359BJW2 BBB A+ M3 86359BJX0 BB A Terwin Mortgage Trust Series TMTS 2005-12ALT Series 2005-12ALT Rating ------ Class CUSIP To From ----- ----- -- ---- M-4 881561WH3 A AA M-5 881561WJ9 B AA- M-6 881561WK6 B AA- B-1 881561WL4 CCC A+ B-2 881561WM2 CCC A B-3 881561WN0 CC A- Rating Lowered and Removed from Creditwatch Negative Homestar Mortgage Acceptance Corp. Series 2004-6 Rating ------ Class CUSIP To From ----- ----- -- ---- M-7 437690CR9 B BBB/Watch Neg Rating Remaining on Creditwatch Negative Structured Asset Securities Corp. Series 2003-28XS Class CUSIP Rating ----- ----- ------ M2 86359AQ89 BBB/Watch Neg Ratings Affirmed and Removed from Creditwatch Negative Deutsche Alt-A Securities Inc Mortgage Loan Trust Series 2003-4XS Series 2003-4XS Rating ------ Class CUSIP To From ----- ----- -- ---- M-2 251510CK7 A A/Watch Neg M-3 251510CL5 B B/Watch Neg Ratings Affirmed Alternative Loan Trust 2005-J1 Series 2005-J1 Class CUSIP Rating ----- ----- ------ 1-A-1 12667FS97 AAA 1-A-2 12667FT21 AAA 1-A-3 12667FT39 AAA 1-A-4 12667FT47 AAA 1-A-5 12667FT54 AAA 1-A-6 12667FT62 AAA 1-A-7 12667F3T0 AAA 1-A-8 12667F3U7 AAA 2-A-1 12667FT88 AAA 3-A-1 12667FU29 AAA 4-A-1 12667FU45 AAA 5-A-1 12667FU60 AAA 5-A-2 12667F3V5 AAA 5-A-3 12667F3W3 AAA 5-A-4 12667F3X1 AAA 6-A-1 12667FU86 AAA 7-A-1 12667F3Y9 AAA X-A 12667FT70 AAA X-B 12667FT96 AAA X-C 12667FU37 AAA X-D 12667FU52 AAA X-E 12667FU78 AAA X-F 12667FU94 AAA PO-A 12667FV28 AAA PO-B 12667F3Z6 AAA PO-C 12667F4A0 AAA PO-D 12667F4B8 AAA A-R 12667FV36 AAA M 12667FV44 AA B-1 12667FV51 A B-2 12667FV69 BBB B-3 12667FV77 BB Alternative Loan Trust 2005-J2 Series 2005-J2 Class CUSIP Rating ----- ----- ------ 1-A-1 12667F5W1 AAA 1-A-2 12667F5X9 AAA 1-A-3 12667F5Y7 AAA 1-A-4 12667F5Z4 AAA 1-A-5 12667F6A8 AAA 1-A-6 12667F6B6 AAA 1-A-7 12667F6C4 AAA 1-A-8 12667F6D2 AAA 1-A-9 12667F6E0 AAA 1-A-10 12667F6F7 AAA 1-A-11 12667F6G5 AAA 1-A-12 12667F6H3 AAA 1-A-13 12667F6J9 AAA 1-X 12667F6K6 AAA PO-A 12667F6L4 AAA 2-A-1 12667F6M2 AAA 2-X 12667F6N0 AAA PO-B 12667F6P5 AAA A-R 12667F6Q3 AAA M 12667F6R1 AA B-1 12667F6S9 A B-2 12667F6T7 BBB B-3 12667F6U4 B B-4 12667F6V2 CCC American Home Mortgage Investment Trust 2004-4 Series 2004-4 Class CUSIP Rating ----- ----- ------ I-A-1 02660TCC5 AAA I-A-2 02660TCD3 AAA II-A-1 02660TCE1 AAA II-A-2 02660TCF8 AAA III-A 02660TCG6 AAA IV-A 02660TCS0 AAA V-A 02660TCT8 AAA VI-A-1 02660TCJ0 AAA VI-A-2 02660TCK7 AAA M-1 02660TCH4 AA VI-M-1 02660TCL5 AA VI-M-2 02660TCM3 A VI-M-3 02660TCN1 A- VI-B-1 02660TCP6 BBB+ VI-B-2 02660TCQ4 BBB VI-B-3 02660TCR2 BBB- VII-A 02660TCU5 AAA American Home Mortgage Investment Trust 2005-1 Series 2005-1 Class CUSIP Rating ----- ----- ------ I-A-1 02660TCZ4 AAA I-A-2 02660TDA8 AAA I-A-3 02660TEA7 AAA II-A-1 02660TDB6 AAA II-A-2 02660TDC4 AAA III-A-1 02660TDD2 AAA III-A-2 02660TDE0 AAA IV-A-1 02660TDF7 AAA IV-A-2 02660TEB5 AAA V-A-1 02660TDG5 AAA V-A-2 02660TEC3 AAA VI-A 02660TDH3 AAA VII-A-1 02660TDJ9 AAA VII-A-2 02660TED1 AAA VIII-A-1 02660TDK6 AAA VIII-A-2 02660TDL4 AAA IX-A 02660TDZ3 BBB M-1 02660TDM2 AA+ VIII-M-1 02660TDT7 AA VIII-M-2 02660TDU4 A Chevy Chase Funding LLC Series 2004-3 Class CUSIP Rating ----- ----- ------ A-1 16678RBU0 AAA A-2 16678RBV8 AAA A-NA AAA IO AAA B-1 16678RBW6 AA B-2 16678RBX4 A B-3 16678RBY2 BBB B-4 16678RBZ9 BB B-5 16678RCA3 B Citigroup Mortgage Loan Trust Inc. Series 2005-WF2 Class CUSIP Rating ----- ----- ------ AF-1 17307GVF2 AAA AF-2 17307GVG0 AAA AF-3 17307GVH8 AAA AF-4 17307GVJ4 AAA AF-5 17307GVK1 AAA AF-6A 17307GVL9 AAA AF-6B 17307GVM7 AAA AF-7 17307GVN5 AAA MF-1 17307GVP0 AA MF-2 17307GVQ8 A MF-3 17307GVR6 BBB MF-4 17307GVS4 BB+ MF-5 17307GWD6 B AV-2 17307GVU9 AAA AV-3 17307GVV7 AAA MV-1 17307GVW5 AA MV-2 17307GVX3 AA MV-3 17307GVY1 A MV-4 17307GVZ8 A- MV-5 17307GWA2 BBB+ MV-6 17307GWB0 BB+ MV-7 17307GWC8 B Deutsche Alt-A Securities Inc Mortgage Loan Trust Series 2003-4XS Series 2003-4XS Class CUSIP Rating ----- ----- ------ A-4 251510CE1 AAA A-5 251510CF8 AAA A-6A 251510CG6 AAA A-6B 251510CT8 AAA M-1 251510CJ0 AA Deutsche Mortgage Securities Inc Mortgage Loan Trust Series 2004-3 Series 2004-3 Class CUSIP Rating ----- ----- ------ I-A-4 251563DV1 AAA I-A-5 251563DW9 AAA I-A-6 251563DX7 AAA I-A-7 251563DY5 AAA II-AR-1 251563ED0 AAA II-AR-2 251563EE8 AAA II-MR-1 251563EF5 AA+ I-M-1 251563EA6 AA II-MR-2 251563EG3 AA- I-M-2 251563EB4 A I-M-3 251563EC2 BBB+ II-MR-3 251563EH1 BBB+ Deutsche Mortgage Securities Inc Mortgage Loan Trust Series 2004-5 Series 2004-5 Class CUSIP Rating ----- ----- ------ A-2 251563FX5 AAA A-3 251563FY3 AAA A-4A 251563FZ0 AAA A-4B 251563GG1 AAA A-5A 251563GA4 AAA A-5B 251563GB2 AAA M-1 251563GD8 AA+ DSLA Mortgage Loan Trust 2004-AR2 Series 2004-AR2 Class CUSIP Rating ----- ----- ------ A-1A 23332UAP9 AAA A-1B 23332UAQ7 AAA A-2A 23332UAR5 AAA A-2B 23332UAS3 AAA A-R 23332UAV6 AAA B-1 23332UAW4 AA+ DSLA Mortgage Loan Trust 2005-AR2 Series 2005-AR2 Class CUSIP Rating ----- ----- ------ 1-A 23332UDB7 AAA 2-A1A 23332UDC5 AAA 2-A1B 23332UDD3 AAA 2-A1C 23332UDE1 AAA 2-A2 23332UDQ4 AAA X-1 23332UDK7 AAA X-2 23332UDL5 AAA PO 23332UDR2 AAA A-R 23332UDS0 AAA B-1 23332UDF8 AA B-2 23332UDG6 A DSLA Mortgage Loan Trust 2005-AR3 Series 2005-AR3 Class CUSIP Rating ----- ----- ------ 1-A 23332UDT8 AAA 2-A1A 23332UDU5 AAA 2-A1B 23332UDV3 AAA 2-A1C 23332UDW1 AAA 2-A2 23332UDX9 AAA X-1 23332UEF7 AAA X-2 23332UEG5 AAA PO 23332UEJ9 AAA A-R 23332UEH3 AAA Homestar Mortgage Acceptance Corp. Series 2004-6 Class CUSIP Rating ----- ----- ------ A-3A 437690CH1 AAA A-3B 437690CJ7 AAA M-1 437690CK4 AA+ M-2 437690CL2 AA M-3 437690CM0 A+ M-4 437690CN8 A Impac CMB Trust Series 2003-4 Series 2003-4 Class CUSIP Rating ----- ----- ------ 1-A-1 45254NED5 AAA 1-B-1 45254NEE3 A- 2-A-1 45254NEF0 AAA 3-A-1 45254NEG8 AAA 3-M-1 45254NEJ2 AA+ 3-M-2 45254NEK9 A+ 3-B-1 45254NEL7 BBB+ Impac CMB Trust Series 2005-5 Series 2005-5 Class CUSIP Rating ----- ----- ------ A-1 45254NPU5 AAA A-2 45254NPV3 AAA A-3W 45254NPW1 AAA A-4 45254NQF7 AAA M-1 45254NPY7 AA+ M-2 45254NPZ4 AA Impac CMB Trust Series 2005-7 Series 2005-7 Class CUSIP Rating ----- ----- ------ A-1 45254NQX8 AAA A-2 45254NQY6 AAA M-1 45254NQZ3 AA M-2 45254NRA7 AA- IndyMac INDX Mortgage Loan Trust 2005-AR18 Series 2005-AR18 Class CUSIP Rating ----- ----- ------ 1-A-1 45660LVZ9 AAA 1-A-2 45660LWA3 AAA 1-A-3A 45660LWB1 AAA 1-A-3B 45660LWC9 AAA 2-A-1A 45660LWD7 AAA 2-A-1B 45660LWE5 AAA 2-A-2A 45660LWV7 AAA 2-A-2B 45660LWW5 AAA 2-A-2C 45660LWF2 AAA 2-A-3A 45660LWG0 AAA 2-A-3B 45660LWH8 AAA 1-X 45660LWS4 AAA 2-X 45660LWT2 AAA A-R 45660LYT0 AAA B-X 45660LWU9 AAA B-1 45660LWJ4 AA+ B-2 45660LWK1 AA B-3 45660LWL9 AA- B-4 45660LWM7 A+ Lehman XS Trust Series 2005-4 Class CUSIP Rating ----- ----- ------ 1-A2 525221BZ9 AAA 1-A3 525221CA3 AAA 1-A4 525221CB1 AAA 1-AX 525221CC9 AAA 1-M1 525221CD7 A+ 1-M2 525221CE5 BB+ 1-M3 525221CF2 CCC 2-A1A 525221CG0 AAA 2-A1B 525221CH8 AAA 2-A2 525221CJ4 AAA 2-A3A 525221CK1 AAA 2-A3B 525221CL9 AAA 2-A4 525221CM7 AAA 2-A5A 525221CN5 AAA 2-A5B 525221CP0 AAA 2-M1 525221CQ8 AA Lehman XS Trust Series 2005-8 Class CUSIP Rating ----- ----- ------ 1-A2 525221DS3 AAA 1-A3 525221DT1 AAA 1-A4 525221DU8 AAA 1-M4 525221DY0 CCC 2-A1A 525221EA1 AAA 2-A1B 525221EB9 AAA 2-A2 525221EC7 AAA 2-A3 525221ED5 AAA 2-A4A 525221EE3 AAA 2-A4B 525221EF0 AAA 2-M1 525221EG8 AA 2-M2 525221EH6 AA 2-M3 525221EJ2 A Lehman XS Trust Series 2005-10 Series 2005-10 Class CUSIP Rating ----- ----- ------ 1-A1 525221FM4 AAA 1-A3 525221FP7 AAA 1-A4 525221FQ5 AAA 1-A5 525221FR3 AAA 2-A1 525221FY8 AAA 2-A2 525221FZ5 AAA 2-A3A 525221GA9 AAA 2-A3B 525221GB7 AAA 2-A4A 525221GC5 AAA 2-A4B 525221GD3 AAA 2-A5A 525221GE1 AAA 2-A5B 525221GF8 AAA 2-M1 525221GG6 AA 2-M2 525221GH4 A- MASTR Alternative Loan Trust 2002-3 Series 2002-3 Class CUSIP Rating ----- ----- ------ A-6 576434BR4 AAA A-7 576434BW3 AAA RALI Series 2002-QS15 Trust Series 2002-QS15 Class CUSIP Rating ----- ----- ------ CB 76110GX63 AAA NB-1 76110GX71 AAA NB-2 76110GX89 AAA NB-3 76110GX97 AAA A-P 76110GY21 AAA A-V 76110GY39 AAA M-1 76110GY62 AAA M-2 76110GY70 AA+ M-3 76110GY88 A RALI Series 2003-QS8 Trust Series 2003-QS8 Class CUSIP Rating ----- ----- ------ A-1 76110HAS8 AAA A-2 76110HAT6 AAA A-3 76110HAU3 AAA A-4 76110HAV1 AAA A-5 76110HAW9 AAA A-6 76110HAX7 AAA A-7 76110HAY5 AAA A-P 76110HAZ2 AAA A-V 76110HBA6 AAA M-1 76110HBD0 AA M-2 76110HBE8 A+ M-3 76110HBF5 BBB B-1 76110HBG3 BB B-2 76110HBH1 CCC Residential Asset Securitization Trust 2002-A12 Series 2002-L Class CUSIP Rating ----- ----- ------ A-4 45660NHW8 AAA PO 45660NHX6 AAA A-X 45660NJF3 AAA 2-A-9 45660NJD8 AAA B-1 45660NJA4 AAA B-2 45660NJB2 AAA B-3 45660NJC0 AA+ Residential Asset Securitization Trust 2002-A14J Series 2002-N Class CUSIP Rating ----- ----- ------ A-4 45660NKT1 AAA A-9 45660NKY0 AAA A-10 45660NKZ7 AAA PO 45660NLA1 AAA A-X 45660NLB9 AAA B-1 45660NLD5 AA+ B-2 45660NLE3 AA B-3 45660NLF0 A+ Residential Asset Securitization Trust 2003-A7 Series 2003-G Class CUSIP Rating ----- ----- ------ A-2 45660NRY3 AAA A-3 45660NRZ0 AAA A-4 45660NSA4 AAA A-5 45660NSB2 AAA A-7 45660NSD8 AAA A-8 45660NSE6 AAA A-9 45660NSF3 AAA A-10 45660NSG1 AAA A-11 45660NSH9 AAA A-12 45660NSJ5 AAA PO 45660NSM8 AAA A-X 45660NSN6 AAA B-1 45660NSQ9 AA B-2 45660NSR7 A B-3 45660NSS5 BBB B-4 45660NST3 BB B-5 45660NSU0 B Structured Asset Securities Corp. Series 2003-18XS Class CUSIP Rating ----- ----- ------ A5 86359AWK5 AAA A6 86359AWL3 AAA A7 86359AYB3 AAA M1 86359AWN9 AA M2 86359AWP4 A M3 86359AWQ2 BB+ Structured Asset Securities Corp. Series 2003-28XS Class CUSIP Rating ----- ----- ------ A4 86359AQ48 AAA A5 86359AQ55 AAA A-6 86359AQ63 AAA M1 86359AQ71 AA Structured Asset Securities Corp. Series 2003-36XS Class CUSIP Rating ----- ----- ------ A4 86359BAT8 AAA A5 86359BAU5 AAA M1 86359BAW1 AA Structured Asset Securities Corp. Series 2004-6XS Class CUSIP Rating ----- ----- ------ A3 86359BJR3 AAA A4 86359BJS1 AAA A5A 86359BJT9 AAA A5B 86359BMB4 AAA A6 86359BJU6 AAA M1 86359BJV4 AA+ Structured Asset Securities Corp. Series 2004-9XS Class CUSIP Rating ----- ----- ------ 1-A4A 86359BRB9 AAA 1-A4B 86359BRH6 AAA 1-A4C 86359BRJ2 AAA 1-A4D 86359BRK9 AAA 1-A5 86359BRC7 AAA 1-A6 86359BRD5 AAA 2-A1 86359BRE3 AAA 1-M1 86359BRF0 AA+ 2-M1 86359BRP8 AA+ 2-M2 86359BRQ6 AA- 1-M2 86359BRG8 A+ M3 86359BRR4 BBB+ Structured Asset Securities Corp. Series 2004-11XS Class CUSIP Rating ----- ----- ------ 1-A3A 86359BUB5 AAA 1-A3B 86359BUC3 AAA 1-A4A 86359BUD1 AAA 1-A4B 86359BVC2 AAA 1-A5A 86359BUE9 AAA 1-A5B 86359BUF6 AAA 1-A6 86359BUG4 AAA 2-A2 86359BUJ8 AAA 2-M1 86359BUL3 AA+ 1-M1 86359BUK5 AA 2-M2 86359BVD0 A+ 1-M2 86359BUN9 A M3(1) 86359BUM1 BBB- M3(2) BBB- Structured Asset Securities Corporation Series 2004-21XS Class CUSIP Rating ----- ----- ------ 1-A3 86359BN56 AAA 1-A4 86359BN64 AAA 1-A5 86359BN72 AAA 2-A2 86359BP21 AAA 2-A3 86359BP39 AAA 2-A4A 86359BP47 AAA 2-A4B 86359BP54 AAA 2-A5A 86359BP62 AAA 2-A5B 86359BP70 AAA 2-A6A 86359BP88 AAA 2-6B 86359BP96 AAA 1-M1 86359BQ20 AA 2-M1 86359BQ46 AA 1-M2 86359BQ38 A 2-M2 86359BQ53 A M3 86359BQ61 BBB Terwin Mortgage Trust Series TMTS 2005-12ALT Series 2005-12ALT Class CUSIP Rating ----- ----- ------ AF-2 881561VW1 AAA AF-3 881561VX9 AAA AF-4 881561VY7 AAA AF-5 881561VZ4 AAA AV-2 881561WB6 AAA AV-3 881561WC4 AAA M-1 881561WE0 AA+ M-2 881561WF7 AA+ M-3 881561WG5 AA+ * BOND PRICING: For the Week of June 2 to June 7, 2008 ------------------------------------------------------ Issuer Coupon Maturity Price ------ ------ -------- ----- AIRTRAN HOLDINGS 7.000% 07/01/23 71 ABC RAIL PRODUCT 10.500% 01/15/04 0 ABC RAIL PRODUCT 10.500% 12/31/04 100 ABITIBI-CONS FIN 7.875% 08/01/09 75 BOWATER INC 9.500% 10/15/12 63 BOWATER INC 6.500% 06/15/13 66 BOWATER INC 9.375% 12/15/21 69 AMBAC INC 7.500% 05/01/23 66 AMBAC INC 5.950% 12/05/35 49 AMBAC INC 6.150% 02/07/87 26 AMERICREDIT CORP 0.750% 09/15/11 71 AMERICREDIT CORP 2.125% 09/15/13 67 ADVANTA CAP TR 8.990% 12/17/26 68 ALESCO FINANCIAL 7.625% 05/15/27 59 ANTIGENICS 5.250% 02/01/25 45 ATHEROGENICS INC 4.500% 03/01/11 11 ATHEROGENICS INC 1.500% 02/01/12 10 ASSURED GUARANTY 6.400% 12/15/66 74 ALLEGIANCE TEL 11.750% 02/15/08 7 ALLEGIANCE TEL 12.875% 05/15/08 7 ALION SCIENCE 10.250% 02/01/15 71 LUCENT TECH 6.500% 01/15/28 76 AMD 6.000% 05/01/15 N.A. AMD 6.000% 05/01/15 71 AMER COLOR GRAPH 10.000% 06/15/10 35 AMER TISSUE INC 12.500% 07/15/06 0 AMES TRUE TEMPER 10.000% 07/15/12 69 AMBASSADORS INTL 3.750% 04/15/27 53 AMR CORP 9.000% 08/01/12 72 AM AIRLN EQ TRST 10.680% 03/04/13 65 AM AIRLN PT TRST 9.730% 09/29/14 72 AMR CORP 9.000% 09/15/16 67 AM AIRLN PT TRST 8.390% 01/02/17 73 AM AIRLN PT TRST 7.377% 05/23/19 69 AMR CORP 10.200% 03/15/20 74 AMR CORP 10.150% 05/15/20 68 AMR CORP 9.880% 06/15/20 61 AMR CORP 10.000% 04/15/21 65 AMR CORP 9.750% 08/15/21 70 ALERIS INTL INC 10.000% 12/15/16 73 ASHTON WOODS USA 9.500% 10/01/15 57 ASPECT MEDICAL 2.500% 06/15/14 57 ASPECT MEDICAL 2.500% 06/15/14 N.A. AT HOME CORP 4.750% 12/15/06 0 AVENTINE RENEW 10.000% 04/01/17 73 BANK NEW ENGLAND 9.500% 02/15/96 100 BANK NEW ENGLAND 8.750% 04/01/99 7 BANK NEW ENGLAND 9.875% 09/15/99 7 BBN CORP 6.000% 04/01/12 0 BUDGET GROUP INC 9.125% 04/01/06 0 BEARINGPOINT INC 3.100% 12/15/24 41 BEARINGPOINT INC 4.100% 12/15/24 38 BELL MICROPRODUC 3.750% 03/05/24 70 BALLY TOTAL FITN 13.000% 07/15/11 68 BANKUNITED CAP 3.125% 03/01/34 42 BURLINGTON NORTH 3.200% 01/01/45 50 NORTHERN PAC RY 3.000% 01/01/47 54 NORTHERN PAC RY 3.000% 01/01/47 75 BUFFETS INC 12.500% 11/01/14 3 BON-TON DEPT STR 10.250% 03/15/14 75 BORLAND SOFTWARE 2.750% 02/15/12 69 BRODER BROS CO 11.250% 10/15/10 68 BUFFALO THUNDER 9.375% 12/15/14 N.A. CONTL AIRLINES 8.750% 12/01/11 70 CAPMARK FINL GRP 6.300% 05/10/17 73 COGENT COMMUNICA 1.000% 06/15/27 67 COMPUCREDIT 3.625% 05/30/25 50 COMPUCREDIT 5.875% 11/30/35 43 CLEAR CHANNEL 5.000% 03/15/12 76 CLEAR CHANNEL 5.750% 01/15/13 72 CLEAR CHANNEL 5.500% 09/15/14 66 CLEAR CHANNEL 4.900% 05/15/15 63 CLEAR CHANNEL 5.500% 12/15/16 60 CLEAR CHANNEL 6.875% 06/15/18 64 CLEAR CHANNEL 7.250% 10/15/27 59 WITCO CORP 6.875% 02/01/26 70 COUNTRYWIDE HOME 5.000% 05/16/13 75 COUNTRYWIDE HOME 5.900% 01/24/18 72 COUNTRYWIDE HOME 6.000% 01/24/18 74 COUNTRYWIDE HOME 5.500% 05/16/18 68 COUNTRYWIDE FINL 5.250% 05/11/20 64 COUNTRYWIDE FINL 5.250% 05/27/20 67 COUNTRYWIDE FINL 6.000% 03/23/21 68 COUNTRYWIDE FINL 6.000% 04/06/21 72 COUNTRYWIDE FINL 6.000% 04/13/21 66 COUNTRYWIDE FINL 6.125% 04/26/21 69 COUNTRYWIDE HOME 6.000% 05/16/23 65 COUNTRYWIDE FINL 6.000% 03/16/26 67 COUNTRYWIDE HOME 6.150% 06/25/29 71 COUNTRYWIDE HOME 6.200% 07/16/29 66 COUNTRYWIDE HOME 6.000% 07/23/29 68 COUNTRYWIDE FINL 6.000% 11/22/30 66 COUNTRYWIDE FINL 5.750% 01/24/31 64 COUNTRYWIDE FINL 5.800% 01/27/31 64 COUNTRYWIDE FINL 6.000% 11/14/35 65 COUNTRYWIDE FINL 6.000% 12/14/35 66 COUNTRYWIDE FINL 6.000% 02/08/36 65 COUNTRYWIDE FINL 6.300% 04/28/36 67 CHARMING SHOPPES 1.125% 05/01/14 64 CHS ELECTRONICS 9.875% 04/15/05 100 CHARTER COMM HLD 11.125% 01/15/11 70 CHARTER COMM HLD 10.000% 05/15/11 70 CHARTER COMM HLD 11.750% 05/15/11 67 CCH I LLC 11.125% 01/15/14 72 CCH I LLC 9.920% 04/01/14 72 CCH I LLC 10.000% 05/15/14 70 CHARTER COMM LP 6.500% 10/01/27 60 CIT GROUP INC 6.500% 03/15/11 72 CIT GROUP INC 6.250% 01/15/13 72 CIT GROUP INC 6.250% 01/15/13 75 CIT GROUP INC 5.500% 08/15/13 71 CIT GROUP INC 5.050% 09/15/14 68 CIT GROUP INC 4.950% 02/15/15 70 CIT GROUP INC 6.150% 05/15/16 72 CIT GROUP INC 5.950% 09/15/16 69 CIT GROUP INC 6.050% 09/15/16 70 CIT GROUP INC 6.000% 11/15/16 70 CIT GROUP INC 5.800% 12/15/16 68 CIT GROUP INC 6.250% 11/15/17 74 CIT GROUP INC 6.150% 09/15/21 68 CIT GROUP INC 6.250% 09/15/21 68 CIT GROUP INC 6.250% 11/15/21 73 CIT GROUP INC 5.950% 02/15/22 69 CIT GROUP INC 5.900% 03/15/22 70 CIT GROUP INC 6.000% 05/15/22 69 CIT GROUP INC 6.100% 03/15/67 55 COLLINS & AIKMAN 10.750% 12/31/11 0 CLAIRE'S STORES 9.250% 06/01/15 68 CLAIRE'S STORES 9.625% 06/01/15 59 CLAIRE'S STORES 10.500% 06/01/17 54 COMERICA CAP TR 6.576% 02/20/37 69 CMP SUSQUEHANNA 9.875% 05/15/14 72 NEW PLAN REALTY 7.970% 08/14/26 68 NEW PLAN REALTY 7.650% 11/02/26 69 NEW PLAN REALTY 7.680% 11/02/26 65 NEW PLAN REALTY 6.900% 02/15/28 68 NEW PLAN REALTY 6.900% 02/15/28 68 NEW PLAN EXCEL 7.500% 07/30/29 67 NEW ORL GRT N RR 5.000% 07/01/32 60 CONSTAR INTL 11.000% 12/01/12 56 CONEXANT SYSTEMS 4.000% 03/01/26 76 COLOR TILE INC 10.750% 12/15/01 100 CAPITALSOURCE 3.500% 07/15/34 70 CV THERAPEUTICS 3.250% 08/16/13 75 CITIZENS UTIL CO 7.000% 11/01/25 77 DELTA AIR LINES 9.875% 04/30/08 N.A. DELTA AIR LINES 8.000% 12/01/15 57 DELTA AIR LINES 10.500% 04/30/16 N.A. DECODE GENETICS 3.500% 04/15/11 39 DILLARD DEPT STR 7.750% 07/15/26 75 DILLARD DEPT STR 7.750% 05/15/27 80 DILLARDS INC 7.000% 12/01/28 71 DELTA MILLS INC 9.625% 09/01/07 10 FIN SEC ASSUR 6.400% 12/15/66 74 DENDREON CORP 4.750% 06/15/14 73 DELPHI CORP 6.500% 08/15/13 42 DELPHI CORP 8.250% 10/15/33 10 DURA OPERATING 9.000% 05/01/09 0 DURA OPERATING 8.625% 04/15/12 11 DOWNEY FINANCIAL 6.500% 07/01/14 69 EDDIE BAUER HLDG 5.250% 04/01/14 71 EPIX MEDICAL INC 3.000% 06/15/24 61 EXODUS COMM INC 4.750% 07/15/08 0 FORD MOTOR CRED 6.650% 10/21/13 75 FORD MOTOR CRED 6.250% 12/20/13 74 FORD MOTOR CRED 6.250% 12/20/13 75 FORD MOTOR CRED 6.500% 12/20/13 74 FORD MOTOR CRED 5.650% 01/21/14 74 FORD MOTOR CRED 5.750% 01/21/14 72 FORD MOTOR CRED 6.000% 01/21/14 73 FORD MOTOR CRED 5.750% 02/20/14 75 FORD MOTOR CRED 5.750% 02/20/14 74 FORD MOTOR CRED 5.900% 02/20/14 74 FORD MOTOR CRED 6.050% 02/20/14 76 FORD MOTOR CRED 6.000% 03/20/14 74 FORD MOTOR CRED 6.000% 03/20/14 72 FORD MOTOR CRED 6.000% 03/20/14 71 FORD MOTOR CRED 6.050% 03/20/14 74 FORD MOTOR CRED 6.050% 04/21/14 70 FORD MOTOR CRED 6.250% 04/21/14 68 FORD MOTOR CRED 6.350% 04/21/14 74 FORD MOTOR CRED 6.300% 05/20/14 73 FORD MOTOR CRED 6.300% 05/20/14 73 FORD MOTOR CRED 6.650% 06/20/14 75 FORD MOTOR CRED 6.750% 06/20/14 75 FORD MOTOR CRED 6.800% 06/20/14 71 FORD MOTOR CRED 6.000% 11/20/14 74 FORD MOTOR CRED 6.000% 11/20/14 73 FORD MOTOR CRED 6.050% 12/22/14 71 FORD MOTOR CRED 6.050% 12/22/14 75 FORD MOTOR CRED 6.150% 12/22/14 72 FORD MOTOR CRED 6.000% 01/20/15 72 FORD MOTOR CRED 6.150% 01/20/15 73 FORD MOTOR CRED 6.250% 01/20/15 70 FORD MOTOR CRED 6.050% 02/20/15 70 FORD MOTOR CRED 6.100% 02/20/15 71 FORD MOTOR CRED 6.200% 03/20/15 69 FORD MOTOR CRED 6.250% 03/20/15 74 FORD MOTOR CRED 6.500% 03/20/15 71 FORD MOTOR CRED 6.800% 03/20/15 74 FORD MOTOR CRED 7.350% 09/15/15 75 FORD MOTOR CRED 7.250% 07/20/17 68 FORD MOTOR CRED 7.250% 07/20/17 72 FORD MOTOR CRED 7.400% 08/21/17 73 FORD MOTOR CO 6.500% 08/01/18 66 FORD HOLDINGS 9.375% 03/01/20 81 FORD MOTOR CO 8.875% 01/15/22 70 FORD MOTOR CO 7.125% 11/15/25 60 FORD MOTOR CO 7.500% 08/01/26 63 FORD MOTOR CO 6.625% 02/15/28 58 FORD MOTOR CO 6.625% 10/01/28 59 FORD MOTOR CO 6.375% 02/01/29 60 FORD HOLDINGS 9.300% 03/01/30 78 FORD MOTOR CO 7.450% 07/16/31 67 FORD MOTOR CO 8.900% 01/15/32 73 FORD MOTOR CRED 7.500% 08/20/32 68 FORD MOTOR CO 7.750% 06/15/43 59 FORD MOTOR CO 7.400% 11/01/46 60 FORD MOTOR CO 7.700% 05/15/97 65 FONTAINEBLEAU LA 10.250% 06/15/15 71 FRANKLIN BANK 4.000% 05/01/27 33 FIRST DATA CORP 4.500% 06/15/10 74 FIRST DATA CORP 5.625% 11/01/11 74 FIRST DATA CORP 4.700% 08/01/13 50 FIRST DATA CORP 4.850% 10/01/14 48 FIRST DATA CORP 4.950% 06/15/15 49 FAMILY GOLF CTRS 5.750% 10/15/04 0 FEDDERS NORTH AM 9.875% 03/01/14 5 FINLAY FINE JWLY 8.375% 06/01/12 41 FINOVA GROUP 7.500% 11/15/09 12 FRONTIER AIRLINE 5.000% 12/15/25 23 FIVE STAR QUALIT 3.750% 10/15/26 73 MEDIANEWS GROUP 6.875% 10/01/13 48 MEDIANEWS GROUP 6.375% 04/01/14 46 GOLDEN BOOKS PUB 10.750% 12/31/04 0 GRANCARE INC 9.375% 09/15/05 0 GEORGIA GULF CRP 10.750% 10/15/16 70 GULF STATES STL 13.500% 04/15/03 100 GENERAL MOTORS 7.700% 04/15/16 73 GENERAL MOTORS 8.800% 03/01/21 76 GENERAL MOTORS 9.400% 07/15/21 77 GENERAL MOTORS 8.250% 07/15/23 71 GENERAL MOTORS 8.100% 06/15/24 65 GENERAL MOTORS 7.400% 09/01/25 61 GENERAL MOTORS 6.750% 05/01/28 53 GENERAL MOTORS 8.375% 07/15/33 67 GENERAL MOTORS 7.375% 05/23/48 62 GMAC 7.000% 01/15/13 74 GMAC 6.450% 02/15/13 72 GMAC 6.800% 02/15/13 72 GMAC 6.250% 03/15/13 74 GMAC 6.500% 03/15/13 72 GMAC 6.750% 04/15/13 74 GMAC 6.800% 04/15/13 75 GMAC 6.875% 04/15/13 71 GMAC 5.850% 05/15/13 73 GMAC 6.100% 05/15/13 72 GMAC 6.350% 05/15/13 69 GMAC 6.500% 05/15/13 73 GMAC 5.700% 06/15/13 68 GMAC 5.850% 06/15/13 69 GMAC 5.850% 06/15/13 67 GMAC 5.850% 06/15/13 73 GMAC 6.500% 06/15/13 77 GMAC 6.000% 07/15/13 73 GMAC 6.250% 07/15/13 70 GMAC 6.375% 08/01/13 74 GMAC 6.500% 08/15/13 72 GMAC 6.150% 09/15/13 67 GMAC 5.700% 10/15/13 70 GMAC 6.250% 10/15/13 71 GMAC 6.300% 10/15/13 74 GMAC 6.000% 11/15/13 68 GMAC 6.100% 11/15/13 70 GMAC 6.150% 11/15/13 73 GMAC 6.200% 11/15/13 71 GMAC 6.250% 11/15/13 71 GMAC 6.300% 11/15/13 68 GMAC 6.500% 11/15/13 73 GMAC 5.700% 12/15/13 68 GMAC 5.900% 12/15/13 66 GMAC 5.900% 12/15/13 66 GMAC 6.000% 12/15/13 71 GMAC 6.150% 12/15/13 69 GMAC 5.250% 01/15/14 66 GMAC 5.350% 01/15/14 71 GMAC 5.750% 01/15/14 69 GMAC 6.375% 01/15/14 66 GMAC 6.700% 05/15/14 70 GMAC 6.700% 05/15/14 73 GMAC 6.700% 06/15/14 74 GMAC 6.750% 06/15/14 67 GMAC 6.750% 12/01/14 77 GMAC 6.750% 07/15/16 67 GMAC 6.600% 08/15/16 60 GMAC 6.700% 08/15/16 65 GMAC 6.750% 08/15/16 71 GMAC 6.875% 08/15/16 64 GMAC 6.750% 09/15/16 69 GMAC 7.375% 11/15/16 64 GMAC 7.500% 11/15/16 69 GMAC 6.750% 06/15/17 63 GMAC 6.900% 06/15/17 60 GMAC 6.950% 06/15/17 60 GMAC 7.000% 06/15/17 65 GMAC 7.000% 07/15/17 61 GMAC 7.500% 08/15/17 66 GMAC 7.250% 09/15/17 66 GMAC 7.250% 09/15/17 64 GMAC 7.250% 09/15/17 62 GMAC 7.250% 09/15/17 60 GMAC 7.125% 10/15/17 62 GMAC 7.200% 10/15/17 60 GMAC 7.200% 10/15/17 67 GMAC 7.750% 10/15/17 66 GMAC 8.000% 10/15/17 70 GMAC 7.500% 11/15/17 68 GMAC 7.500% 11/15/17 69 GMAC 8.000% 11/15/17 69 GMAC 7.300% 12/15/17 62 GMAC 7.400% 12/15/17 63 GMAC 7.500% 12/15/17 67 GMAC 7.500% 12/15/17 74 GMAC 7.250% 01/15/18 63 GMAC 7.300% 01/15/18 66 GMAC 7.300% 01/15/18 71 GMAC 7.000% 02/15/18 64 GMAC 7.000% 02/15/18 60 GMAC 7.000% 02/15/18 60 GMAC 6.750% 03/15/18 61 GMAC 7.000% 03/15/18 65 GMAC 7.050% 03/15/18 60 GMAC 7.050% 03/15/18 63 GMAC 7.050% 04/15/18 59 GMAC 7.250% 04/15/18 62 GMAC 7.250% 04/15/18 63 GMAC 7.350% 04/15/18 62 GMAC 7.375% 04/15/18 66 GMAC 6.600% 05/15/18 59 GMAC 6.850% 05/15/18 60 GMAC 7.000% 05/15/18 61 GMAC 6.500% 06/15/18 59 GMAC 6.650% 06/15/18 58 GMAC 6.700% 06/15/18 56 GMAC 6.700% 06/15/18 59 GMAC 6.750% 07/15/18 60 GMAC 6.875% 07/15/18 67 GMAC 6.900% 07/15/18 64 GMAC 6.900% 08/15/18 61 GMAC 7.000% 08/15/18 65 GMAC 7.250% 08/15/18 62 GMAC 7.250% 08/15/18 70 GMAC 6.750% 09/15/18 61 GMAC 6.800% 09/15/18 60 GMAC 7.000% 09/15/18 62 GMAC 7.150% 09/15/18 65 GMAC 7.250% 09/15/18 65 GMAC 6.650% 10/15/18 59 GMAC 6.650% 10/15/18 59 GMAC 6.750% 10/15/18 59 GMAC 6.800% 10/15/18 66 GMAC 6.500% 11/15/18 60 GMAC 6.700% 11/15/18 58 GMAC 6.750% 11/15/18 63 GMAC 6.250% 12/15/18 65 GMAC 6.400% 12/15/18 58 GMAC 6.500% 12/15/18 62 GMAC 6.500% 12/15/18 62 GMAC 5.900% 01/15/19 55 GMAC 5.900% 01/15/19 57 GMAC 6.250% 01/15/19 60 GMAC 5.900% 02/15/19 59 GMAC 6.000% 02/15/19 62 GMAC 6.000% 02/15/19 56 GMAC 6.000% 02/15/19 58 GMAC 6.000% 03/15/19 56 GMAC 6.000% 03/15/19 56 GMAC 6.000% 03/15/19 59 GMAC 6.000% 03/15/19 58 GMAC 6.000% 03/15/19 59 GMAC 6.000% 04/15/19 58 GMAC 6.200% 04/15/19 60 GMAC 6.250% 04/15/19 60 GMAC 6.350% 04/15/19 57 GMAC 6.250% 05/15/19 57 GMAC 6.500% 05/15/19 58 GMAC 6.750% 05/15/19 63 GMAC 6.750% 05/15/19 56 GMAC 6.600% 06/15/19 59 GMAC 6.600% 06/15/19 58 GMAC 6.700% 06/15/19 65 GMAC 6.750% 06/15/19 62 GMAC 6.750% 06/15/19 61 GMAC 6.250% 07/15/19 57 GMAC 6.350% 07/15/19 59 GMAC 6.350% 07/15/19 60 GMAC 6.050% 08/15/19 56 GMAC 6.050% 08/15/19 60 GMAC 6.150% 08/15/19 64 GMAC 6.300% 08/15/19 60 GMAC 6.300% 08/15/19 61 GMAC 6.000% 09/15/19 56 GMAC 6.000% 09/15/19 57 GMAC 6.100% 09/15/19 56 GMAC 6.150% 09/15/19 57 GMAC 5.900% 10/15/19 63 GMAC 6.050% 10/15/19 56 GMAC 6.125% 10/15/19 57 GMAC 6.150% 10/15/19 57 GMAC 6.400% 11/15/19 57 GMAC 6.400% 11/15/19 59 GMAC 6.550% 12/15/19 63 GMAC 6.700% 12/15/19 61 GMAC 6.500% 01/15/20 58 GMAC 6.500% 02/15/20 66 GMAC 6.650% 02/15/20 61 GMAC 6.750% 03/15/20 65 GMAC 9.000% 07/15/20 77 GMAC 7.000% 02/15/21 63 GMAC 7.000% 09/15/21 60 GMAC 7.000% 09/15/21 67 GMAC 7.000% 06/15/22 64 GMAC 7.000% 11/15/23 64 GMAC 7.000% 11/15/24 60 GMAC 7.000% 11/15/24 58 GMAC 7.000% 11/15/24 62 GMAC 7.150% 01/15/25 65 GMAC 7.250% 01/15/25 56 GMAC 7.250% 02/15/25 64 GMAC 7.150% 03/15/25 67 GMAC 7.250% 03/15/25 60 GMAC 7.500% 03/15/25 67 GMAC 8.000% 03/15/25 71 OUTBOARD MARINE 10.750% 06/01/08 10 OUTBOARD MARINE 9.125% 04/15/17 7 GLOBALSTAR INC 5.750% 04/01/28 72 REALOGY CORP 10.500% 04/15/14 76 REALOGY CORP 12.375% 04/15/15 55 HUNTINGTON CAPIT 6.650% 05/15/37 69 HUB INTL HOLDING 10.250% 06/15/15 75 COLUMBIA/HCA 7.050% 12/01/27 78 COLUMBIA/HCA 7.500% 11/15/95 71 HERBST GAMING 8.125% 06/01/12 24 HERBST GAMING 7.000% 11/15/14 22 HARRAHS OPER CO 5.375% 12/15/13 65 HARRAHS OPER CO 5.625% 06/01/15 58 HARRAHS OPER CO 6.500% 06/01/16 60 HARRAHS OPER CO 5.750% 10/01/17 55 HUMAN GENOME 2.250% 08/15/12 74 HILTON HOTELS 7.500% 12/15/17 74 HINES NURSERIES 10.250% 10/01/11 58 K HOVNANIAN ENTR 8.875% 04/01/12 76 K HOVNANIAN ENTR 7.750% 05/15/13 67 K HOVNANIAN ENTR 6.500% 01/15/14 69 K HOVNANIAN ENTR 6.375% 12/15/14 69 K HOVNANIAN ENTR 6.250% 01/15/15 69 K HOVNANIAN ENTR 6.250% 01/15/16 68 K HOVNANIAN ENTR 7.500% 05/15/16 69 HERCULES INC 6.500% 06/30/29 75 HERTZ CORP 7.000% 01/15/28 75 HEADWATERS INC 2.500% 02/01/14 71 HEADWATERS INC 2.500% 02/01/14 68 HAWAIIAN TELCOM 9.750% 05/01/13 40 HAWAIIAN TELCOM 12.500% 05/01/15 26 BORDEN INC 8.375% 04/15/16 56 BORDEN INC 9.200% 03/15/21 57 BORDEN INC 7.875% 02/15/23 47 IDEARC INC 8.000% 11/15/16 72 ION MEDIA 11.000% 07/31/13 24 ISOLAGEN INC 3.500% 11/01/24 15 INDALEX HOLD 11.500% 02/01/14 55 IRIDIUM LLC/CAP 10.875% 07/15/05 0 IRIDIUM LLC/CAP 11.250% 07/15/05 1 IRIDIUM LLC/CAP 13.000% 07/15/05 1 IRIDIUM LLC/CAP 14.000% 07/15/05 0 JAZZ TECHNOLOGIE 8.000% 12/31/11 69 JETBLUE AIRWAYS 3.750% 03/15/35 70 JB POINDEXTER 8.750% 03/15/14 73 JONES APPAREL 6.125% 11/15/34 70 JPMORGAN CHASE 10.000% 07/31/08 70 JPMORGAN CHASE 12.000% 07/31/08 36 JPMORGAN CHASE 9.500% 09/29/08 70 KEYSTONE AUTO OP 9.750% 11/01/13 64 KELLSTROM INDS 5.750% 10/15/02 0 KEMET CORP 2.250% 11/15/26 69 KEMET CORP 2.250% 11/15/26 70 KIMBALL HILL INC 10.500% 12/15/12 2 KAISER ALUMINUM 12.750% 02/01/03 5 K MART FUNDING 8.800% 07/01/10 1 KMART 95-K1 PT 8.990% 07/05/10 N.A. KMART 95-K4 PT 9.350% 01/02/20 0 KMART 95-K2 PT 9.780% 01/05/20 N.A. KRATON POLYMERS 8.125% 01/15/14 64 KELLWOOD CO 7.625% 10/15/17 66 LIBERTY MEDIA 4.000% 11/15/29 56 LIBERTY MEDIA 3.750% 02/15/30 56 LIBERTY MEDIA 3.500% 01/15/31 54 LIBERTY MEDIA 3.250% 03/15/31 67 LAZYDAYS RV 11.750% 05/15/12 73 US AIRWAYS GROUP 7.000% 09/30/20 70 LIFETIME BRANDS 4.750% 07/15/11 72 LEHMAN BROS HLDG 5.500% 04/15/23 79 LEHMAN BROS HLDG 5.000% 05/28/23 78 LEHMAN BROS HLDG 4.800% 06/24/23 72 LEHMAN BROS HLDG 5.750% 12/16/28 70 LEHMAN BROS HLDG 5.750% 12/23/28 77 LEHMAN BROS HLDG 5.600% 03/02/29 76 LEHMAN BROS HLDG 5.700% 04/13/29 77 LEHMAN BROS HLDG 5.550% 01/25/30 75 LEHMAN BROS HLDG 5.450% 02/22/30 72 LEHMAN BROS HLDG 5.625% 03/15/30 73 LEHMAN BROS HLDG 5.500% 08/02/30 73 LEHMAN CAP VII 5.857% N.A. 72 LEINER HEALTH 11.000% 06/01/12 2 CHENIERE ENERGY 2.250% 08/01/12 54 LIFECARE HOLDING 9.250% 08/15/13 61 EQUISTAR CHEMICA 7.550% 02/15/26 71 MILLENNIUM AMER 7.625% 11/15/26 58 MAJESTIC STAR 9.750% 01/15/11 34 MBIA INC 7.000% 12/15/25 77 MBIA INC 6.625% 10/01/28 68 MAGNA ENTERTAINM 7.250% 12/15/09 51 MAGNA ENTERTAINM 8.550% 06/15/10 53 MERRILL LYNCH 10.000% 03/06/09 N.A. MERRILL LYNCH 11.000% 04/28/09 N.A. MERRILL LYNCH 8.100% 06/04/09 N.A. MERRILL LYNCH 12.000% 03/26/10 N.A. MERIX CORP 4.000% 05/15/13 53 METALDYNE CORP 11.000% 06/15/12 27 METALDYNE CORP 10.000% 11/01/13 56 MASONITE CORP 11.000% 04/06/15 67 KNIGHT RIDDER 4.625% 11/01/14 70 KNIGHT RIDDER 5.750% 09/01/17 69 KNIGHT RIDDER 7.150% 11/01/27 66 KNIGHT RIDDER 6.875% 03/15/29 64 MANNKIND CORP 3.750% 12/15/13 53 MOMENTIVE PERFOR 11.500% 12/01/16 75 MORRIS PUBLISH 7.000% 08/01/13 60 MOTOROLA INC 5.220% 10/01/97 54 MOA HOSPITALITY 8.000% 10/15/07 75 MOVIE GALLERY 11.000% 05/01/12 30 MRS FIELDS 9.000% 03/15/11 62 MORGAN STANLEY 10.000% 04/20/09 N.A. MORGAN STANLEY 10.000% 05/20/09 N.A. NORTH ATL TRADNG 9.250% 03/01/12 62 NEFF CORP 10.000% 06/01/15 45 NEWARK GROUP INC 9.750% 03/15/14 75 NATL FINANCIAL 0.750% 02/01/12 71 NEKTAR THERAPEUT 3.250% 09/28/12 74 NELNET INC 7.400% 09/29/36 67 NATL STEEL CORP 8.375% 08/01/06 0 NORTHERN TEL CAP 7.875% 06/15/26 70 NTK HOLDINGS INC 0.000% 03/01/14 53 NORTEK INC 8.500% 09/01/14 70 GLOBAL HEALTH SC 11.000% 05/01/08 0 NUVEEN INVEST 5.500% 09/15/15 73 NORTHWESTERN CRP 7.960% 12/21/26 4 NETWORK EQUIPMNT 3.750% 12/15/14 66 NORTHWST STL&WIR 9.500% 06/15/01 0 REALTY INCOME 5.875% 03/15/35 71 OMNICARE INC 3.250% 12/15/35 72 OAKWOOD HOMES 7.875% 03/01/04 0 OAKWOOD HOMES 8.125% 03/01/09 0 AMER & FORGN PWR 5.000% 03/01/30 52 OSCIENT PHARM 3.500% 04/15/11 41 OSI RESTAURANT 10.000% 06/15/15 70 PAC-WEST TELECOM 13.500% 02/01/09 2 PENHALL INTL 12.000% 08/01/14 75 RESTAURANT CO 10.000% 10/01/13 67 PALM HARBOR 3.250% 05/15/24 59 PIERRE FOODS INC 9.875% 07/15/12 29 PACKAGING DYNAMI 10.000% 05/01/16 67 PLY GEM INDS 9.000% 02/15/12 66 PORTOLA PACKAGIN 8.250% 02/01/12 58 PROPEX FABRICS 10.000% 12/01/12 1 PRIMUS TELECOM 5.000% 06/30/09 61 PRIMUS TELECOM 3.750% 09/15/10 45 PRIMUS TELECOM 8.000% 01/15/14 37 POPE & TALBOT 8.375% 06/01/13 14 POPE & TALBOT 8.375% 06/01/13 4 PANTRY INC 3.000% 11/15/12 70 NUTRITIONAL SRC 10.125% 08/01/09 13 POWERWAVE TECH 1.875% 11/15/24 71 POWERWAVE TECH 3.875% 10/01/27 73 POWERWAVE TECH 3.875% 10/01/27 74 PIXELWORKS INC 1.750% 05/15/24 70 QUALITY DISTRIBU 9.000% 11/15/10 65 RITE AID CORP 6.875% 08/15/13 70 RITE AID CORP 7.700% 02/15/27 59 RITE AID CORP 6.875% 12/15/28 53 RAFAELLA APPAREL 11.250% 06/15/11 53 RAIT FINANCIAL 6.875% 04/15/27 55 RADIAN GROUP 5.625% 02/15/13 77 RADIAN GROUP 5.375% 06/15/15 78 EVEREST RE HLDGS 6.600% 05/15/37 75 RESIDENTIAL CAP 8.375% 06/30/10 53 RESIDENTIAL CAP 8.000% 02/22/11 48 RESIDENTIAL CAP 8.500% 06/01/12 54 RESIDENTIAL CAP 8.500% 04/17/13 50 RESIDENTIAL CAP 8.875% 06/30/15 50 REGIONS FIN TR 6.625% 05/15/47 73 RH DONNELLEY 6.875% 01/15/13 67 RH DONNELLEY 6.875% 01/15/13 67 RH DONNELLEY 6.875% 01/15/13 67 RH DONNELLEY 8.875% 01/15/16 65 RH DONNELLEY 8.875% 10/15/17 67 RICKEL HOME CNTR 13.500% 12/15/01 0 ROTECH HEALTHCA 9.500% 04/01/12 78 RENTECH INC 4.000% 04/15/13 51 SPECIAL DEVICES 11.375% 12/15/08 N.A. SEARS ROEBUCK AC 7.500% 10/15/27 71 SEARS ROEBUCK AC 6.750% 01/15/28 77 SEARS ROEBUCK AC 6.500% 12/01/28 75 SEARS ROEBUCK AC 7.000% 06/01/32 68 SPHERIS INC 11.000% 12/15/12 83 CD RADIO INC 8.750% 09/29/09 5 SIX FLAGS INC 8.875% 02/01/10 88 SIX FLAGS INC 9.750% 04/15/13 65 SIX FLAGS INC 9.625% 06/01/14 60 SIX FLAGS INC 4.500% 05/15/15 56 SLM CORP 5.000% 09/15/15 72 SLM CORP 5.550% 03/15/18 72 SLM CORP 5.600% 03/15/18 72 SLM CORP 5.650% 03/15/18 70 SLM CORP 5.600% 06/15/18 72 SLM CORP 5.250% 03/15/19 73 SLM CORP 5.400% 03/15/19 74 SLM CORP 5.500% 03/15/19 74 SLM CORP 5.190% 04/24/19 68 SLM CORP 5.000% 06/15/19 66 SLM CORP 5.150% 06/15/19 69 SLM CORP 5.500% 06/15/19 74 SLM CORP 6.000% 06/15/19 73 SLM CORP 5.500% 09/15/19 62 SLM CORP 5.900% 09/15/19 73 SLM CORP 6.000% 09/15/19 74 SLM CORP 6.000% 09/15/19 75 SLM CORP 5.250% 06/15/20 66 SLM CORP 5.200% 12/15/20 N.A. SLM CORP 5.450% 12/15/20 72 SLM CORP 6.150% 03/10/21 75 SLM CORP 6.000% 06/15/21 70 SLM CORP 6.000% 06/15/21 69 SLM CORP 6.150% 06/15/21 68 SLM CORP 6.150% 06/15/21 71 SLM CORP 5.600% 03/15/22 68 SLM CORP 5.650% 06/15/22 70 SLM CORP 5.650% 06/15/22 69 SLM CORP 5.050% 03/15/23 59 SLM CORP 5.400% 03/15/23 73 SLM CORP 5.450% 03/15/23 58 SLM CORP 5.600% 03/15/24 62 SLM CORP 5.625% 01/25/25 65 SLM CORP 5.350% 06/15/25 63 SLM CORP 5.550% 06/15/25 65 SLM CORP 6.000% 06/15/26 66 SLM CORP 6.000% 06/15/26 68 SLM CORP 6.000% 12/15/26 75 SLM CORP 6.000% 12/15/26 68 SLM CORP 6.000% 12/15/26 68 SLM CORP 6.050% 12/15/26 67 SLM CORP 6.000% 03/15/27 68 SLM CORP 5.200% 03/15/28 62 SLM CORP 5.250% 03/15/28 70 SLM CORP 5.450% 03/15/28 72 SLM CORP 5.000% 06/15/28 74 SLM CORP 5.250% 06/15/28 57 SLM CORP 5.450% 06/15/28 65 SLM CORP 5.450% 06/15/28 67 SLM CORP 5.500% 06/15/28 62 SLM CORP 5.550% 06/15/28 72 SLM CORP 4.800% 12/15/28 65 SLM CORP 5.000% 12/15/28 54 SLM CORP 5.150% 12/15/28 69 SLM CORP 5.250% 12/15/28 69 SLM CORP 5.600% 12/15/28 70 SLM CORP 5.800% 12/15/28 64 SLM CORP 6.000% 12/15/28 61 SLM CORP 6.000% 12/15/28 70 SLM CORP 6.000% 12/15/28 65 SLM CORP 5.600% 03/15/29 59 SLM CORP 5.600% 03/15/29 64 SLM CORP 5.650% 03/15/29 65 SLM CORP 5.650% 03/15/29 74 SLM CORP 5.700% 03/15/29 66 SLM CORP 5.700% 03/15/29 61 SLM CORP 5.700% 03/15/29 65 SLM CORP 5.750% 03/15/29 72 SLM CORP 5.750% 03/15/29 63 SLM CORP 5.750% 03/15/29 67 SLM CORP 5.750% 03/15/29 65 SLM CORP 6.000% 03/15/29 67 SLM CORP 5.500% 06/15/29 63 SLM CORP 5.500% 06/15/29 63 SLM CORP 5.500% 06/15/29 63 SLM CORP 5.750% 06/15/29 65 SLM CORP 5.750% 06/15/29 58 SLM CORP 6.000% 06/15/29 62 SLM CORP 6.000% 06/15/29 60 SLM CORP 6.000% 06/15/29 67 SLM CORP 6.250% 06/15/29 68 SLM CORP 6.250% 06/15/29 68 SLM CORP 5.750% 09/15/29 63 SLM CORP 5.850% 09/15/29 66 SLM CORP 5.850% 09/15/29 64 SLM CORP 6.000% 09/15/29 67 SLM CORP 6.000% 09/15/29 65 SLM CORP 6.000% 09/15/29 67 SLM CORP 6.000% 09/15/29 66 SLM CORP 6.000% 09/15/29 66 SLM CORP 6.150% 09/15/29 66 SLM CORP 6.150% 09/15/29 68 SLM CORP 6.250% 09/15/29 68 SLM CORP 6.250% 09/15/29 67 SLM CORP 5.600% 12/15/29 57 SLM CORP 5.600% 12/15/29 63 SLM CORP 5.650% 12/15/29 66 SLM CORP 5.650% 12/15/29 63 SLM CORP 5.650% 12/15/29 64 SLM CORP 5.700% 12/15/29 62 SLM CORP 5.750% 12/15/29 62 SLM CORP 5.750% 12/15/29 64 SLM CORP 5.750% 12/15/29 64 SLM CORP 5.750% 12/15/29 65 SLM CORP 5.500% 03/15/30 64 SLM CORP 5.500% 03/15/30 62 SLM CORP 5.650% 03/15/30 64 SLM CORP 5.700% 03/15/30 66 SLM CORP 5.750% 03/15/30 64 SLM CORP 5.750% 03/15/30 67 SLM CORP 5.400% 06/15/30 60 SLM CORP 5.650% 06/15/30 59 SLM CORP 5.700% 06/15/30 63 SLM CORP 5.300% 09/15/30 63 SLM CORP 5.650% 09/15/30 65 SLM CORP 5.500% 12/15/30 64 SLM CORP 6.000% 06/15/31 67 SLM CORP 6.000% 06/15/31 65 SLM CORP 6.250% 09/15/31 68 SLM CORP 6.350% 09/15/31 68 SLM CORP 6.350% 09/15/31 67 SLM CORP 6.400% 09/15/31 62 SLM CORP 6.450% 09/15/31 69 SLM CORP 6.500% 09/15/31 69 SLM CORP 5.850% 12/15/31 63 SLM CORP 6.000% 12/15/31 68 SLM CORP 6.000% 12/15/31 65 SLM CORP 6.000% 12/15/31 67 SLM CORP 6.000% 12/15/31 67 SLM CORP 6.050% 12/15/31 67 SLM CORP 6.100% 12/15/31 66 SLM CORP 6.200% 12/15/31 67 SLM CORP 5.650% 03/15/32 62 SLM CORP 5.700% 03/15/32 65 SLM CORP 5.800% 03/15/32 66 SLM CORP 5.800% 03/15/32 64 SLM CORP 5.800% 03/15/32 66 SLM CORP 5.850% 03/15/32 58 SLM CORP 5.850% 03/15/32 59 SLM CORP 5.850% 03/15/32 66 SLM CORP 5.750% 06/15/32 64 SLM CORP 5.750% 06/15/32 64 SLM CORP 5.850% 06/15/32 66 SLM CORP 5.850% 06/15/32 66 SLM CORP 5.625% 08/01/33 73 SLM CORP 6.850% 07/07/36 73 SLM CORP 6.000% 03/15/37 66 SLM CORP 6.000% 03/15/37 62 SLM CORP 6.000% 03/15/37 66 SPINNAKER INDS 10.750% 10/15/06 0 SPECTRUM BRANDS 7.375% 02/01/15 73 STANDARD PACIFIC 9.250% 04/15/12 78 STANDRD PAC CORP 6.000% 10/01/12 71 SPANSION LLC 11.250% 01/15/16 66 SPANSION LLC 2.250% 06/15/16 49 STANLEY-MARTIN 9.750% 08/15/15 45 SUNTRUST PFD CAP 5.853% N.A. 74 STATION CASINOS 6.500% 02/01/14 63 STATION CASINOS 6.875% 03/01/16 60 STATION CASINOS 6.625% 03/15/18 59 SERVICEMASTER CO 7.100% 03/01/18 54 SERVICEMASTER CO 7.450% 08/15/27 48 SERVICEMASTER CO 7.250% 03/01/38 57 SWIFT TRANS CO 12.500% 05/15/17 41 TELIGENT INC 11.500% 12/01/07 0 TELIGENT INC 11.500% 03/01/08 0 TENET HEALTHCARE 6.875% 11/15/31 75 THERAVANCE INC 3.000% 01/15/15 76 TRANS-LUX CORP 8.250% 03/01/12 56 TRANSMERIDIAN EX 12.000% 12/15/10 61 TOUSA INC 9.000% 07/01/10 62 TOUSA INC 9.000% 07/01/10 55 TOUSA INC 7.500% 03/15/11 9 TOUSA INC 10.375% 07/01/12 11 TOUSA INC 7.500% 01/15/15 10 TOYS R US 7.375% 10/15/18 78 TRIBUNE CO 4.875% 08/15/10 62 TIMES MIRROR CO 7.250% 03/01/13 39 TRIBUNE CO 5.250% 08/15/15 44 TIMES MIRROR CO 7.500% 07/01/23 41 TIMES MIRROR CO 6.610% 09/15/27 37 TIMES MIRROR CO 7.250% 11/15/96 32 TRUMP ENTERTNMNT 8.500% 06/01/15 68 WIMAR OP LLC/FIN 9.625% 12/15/14 56 TRUE TEMPER 8.375% 09/15/11 65 RJ TOWER CORP 12.000% 06/01/13 1 TXU CORP 6.500% 11/15/24 77 TXU CORP 6.550% 11/15/34 75 UAL 1995 TRUST 9.020% 04/19/12 40 UAL 1991 TRUST 10.020% 03/22/14 48 UAL 1995 TRUST 9.560% 10/19/18 45 UAL CORP 5.000% 02/01/21 50 UAL CORP 4.500% 06/30/21 52 UAL CORP 4.500% 06/30/21 56 US AIR INC 10.900% 01/01/49 0 US AIR INC 10.750% 01/15/49 0 UNIVERSAL STAND 8.250% 02/01/06 0 MISSOURI PAC RR 5.000% 01/01/45 68 CHIC EAST ILL RR 5.000% 01/01/54 61 VISTEON CORP 7.000% 03/10/14 66 VENTURE HLDGS 9.500% 07/01/05 0 VENTURE HLDGS 11.000% 06/01/07 0 VERTIS INC 10.875% 06/15/09 46 VION PHARM INC 7.750% 02/15/12 53 VIRGIN RIVER CAS 9.000% 01/15/12 72 VICORP RESTAURNT 10.500% 04/15/11 15 VERENIUM CORP 5.500% 04/01/27 41 VERASUN ENERGY 9.375% 06/01/17 68 VESTA INSUR GRP 8.750% 07/15/25 2 WEBSTER CAPITAL 7.650% 06/15/37 67 WCI COMMUNITIES 9.125% 05/01/12 44 WCI COMMUNITIES 7.875% 10/01/13 40 WCI COMMUNITIES 6.625% 03/15/15 41 WCI COMMUNITIES 4.000% 08/05/23 63 WINSTAR COMM INC 10.000% 03/15/08 0 WINSTAR COMM INC 14.750% 04/15/10 0 WCI STEEL ACQUIS 8.000% 05/01/16 64 WERNER HOLDINGS 10.000% 11/15/07 0 WILLIAM LYON 7.625% 12/15/12 57 WILLIAM LYON 10.750% 04/01/13 68 WILLIAM LYON 7.500% 02/15/14 61 WASH MUTUAL PFD 6.534% N.A. 59 WASH MUTUAL PFD 6.895% N.A. 60 WASH MUTUAL PFD 6.665% N.A. 62 PEGASUS SATELLIT 9.750% 12/01/06 0 PEGASUS SATELLIT 12.500% 08/01/07 0 YOUNG BROADCSTNG 10.000% 03/01/11 67 YOUNG BROADCSTNG 8.750% 01/15/14 58 ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers' public debt and equity securities about which we report. Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than $3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. A list of Meetings, Conferences and Seminars appears in each Wednesday's edition of the TCR. Submissions about insolvency- related conferences are encouraged. Send announcements to conferences@bankrupt.com/ On Thursdays, the TCR delivers a list of recently filed chapter 11 cases involving less than $1,000,000 in assets and liabilities delivered to nation's bankruptcy courts. The list includes links to freely downloadable images of these small-dollar petitions in Acrobat PDF format. Each Friday's edition of the TCR includes a review about a book of interest to troubled company professionals. All titles are available at your local bookstore or through Amazon.com. Go to http://www.bankrupt.com/books/to order any title today. Monthly Operating Reports are summarized in every Saturday edition of the TCR. For copies of court documents filed in the District of Delaware, please contact Vito at Parcels, Inc., at 302-658-9911. For bankruptcy documents filed in cases pending outside the District of Delaware, contact Ken Troubh at Nationwide Research & Consulting at 207/791-2852. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter is a daily newsletter co-published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland, USA. Shimero R. Jainga, Ronald C. Sy, Joel Anthony G. Lopez, Cecil R. Villacampa, Melanie C. Pador, Ludivino Q. Climaco, Jr., Loyda I. Nartatez, Tara Marie A. Martin, Joseph Medel C. Martirez, Ma. Cristina I. Canson, Christopher G. Patalinghug, and Peter A. Chapman, Editors. Copyright 2008. All rights reserved. ISSN: 1520-9474. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR subscription rate is $775 for 6 months delivered via e- mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Christopher Beard at 240/629-3300. *** End of Transmission ***