/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/081118.mbx T R O U B L E D C O M P A N Y R E P O R T E R Tuesday, November 18, 2008, Vol. 12, No. 275 Headlines AGRIPROCESSORS INC: May Find Financial Help From Outside Investors ALDERSGATE FINANCE: Moody's Junks Ratings on Five Classes of Notes ALICE BAUMFALK: Case Summary & 6 Largest Unsecured Creditors AMERICAN INTERNATIONAL: Federal Reserve Will Hire Advisers AMERICAN APPAREL: Violates SOF Loan Covenant, Negotiates Terms AMERICAN MEDIA: Defers Interest Payment on 2009 Sr. Sub. Notes ASHLAND INC: Moody's Pares Rating to 'Ba2' on Hercules Acquisition ASHLAND INC: S&P Cuts Corporate Rating to 'BB-' on Hercules Merger ATILLWATER MINING: S&P Puts 'B+' Rating on CreditWatch Negative BEAR STEARNS: S&P Affirms Low-B Ratings on 6 Classes of Certs. BEAR STEARNS: S&P Pares 25 Classes' Ratings on Projected Losses BEAZER HOMES: Reports 38.2% Decline in Home Closings for Sept. Qtr BORGER ENERGY: Moody's Reviews 'Ba3' Rating for Possible Upgrade BOWNE & CO: Poor Performance Prompts Moody's Rating Downgrades BRADLY VAUGHAN: Case Summary & 36 Largest Unsecured Creditors BUILDERS FIRSTSOURCE: Moody's Junks Corporate Family Rating BUILDING MATERIALS: Q3 Sales Down 39%; To Close 34 Ailing Units CASEY TOOL: Case Summary & 20 Largest Unsecured Creditors CHAPARRAL ENERGY: S&P Changes CreditWatch Implication to Negative CHRYSLER LLC: PBGC Wants More Information on Retirement Plans CITIGROUP INC: To Cut 50,000 Jobs, Raise Credit Card Rates CITIGROUP MORTGAGE: Fitch Puts Low-B Ratings on Two Note Classes CITY OF ATLANTA: Wants TARP Funds Due to Dire Fiscal Situation COEUR D'ALENE: S&P Puts 'B+' Rating on Negative Watch CPG MARKETING: Voluntary Chapter 11 Case Summary CS FIRST: Fitch Takes Rating Actions on Various Classes of Notes CULPEPER CROSSROADS: Asks Court to Dismiss Chapter 11 Case DBP EXPLORATION: Case Summary & 20 Largest Unsecured Creditors DBSI INC: Taps Young Conaway Stargatt as Attorney DBSI INC: Blames Rising Operating Costs for Bankruptcy DELPHI CORP: Cancels Dec. 31 Bankruptcy Emergence Timetable DELPHI CORP: Signs 2 Gm Deals For Liquidity Until Mid-2009 DELPHI CORP: To Sell Exhaust Biz.; Mexican Firm is Lead Bidder DELPHI CORP: To Seek 6-Month Extension of $4.35-Bil. DIP Loan DOWNSTREAM DEVELOPMENT: Moody's Junks Corporate Family Rating ENOSH DEVELOPMENT: Voluntary Chapter 11 Case Summary ENTERCOM COMMUNICATIONS: Narrow Margins Cue S&P's Rating Cut to B+ EVEREST ENTERPRISES: Voluntary Chapter 11 Case Summary FEDERAL-MOGUL: Releases Status Report of Chapter 11 Cases FIRST NATIONAL: Moody's Rates Class D Notes at 'Ba2' FIRST UNION: S&P Downgrades Ratings on Four Classes of Certs. FLAGSTAR BANK: Moody's Downgrades Deposit Ratings to 'Ba1' FORD CREDIT: Fitch Affirms 'BB' Rating on Class D Notes FORD MOTOR: PBGC Wants More Information on Retirement Plans FREDDIE MAC: Moody's Says Ratings Unaffected by $25.3-BB Net Loss GENERAL GROWTH: Strained Liquidity Cues Moody's to Junk Ratings GENERAL MOTORS: Approval of Bailout for Automakers Uncertain GENERAL MOTORS: Sells 3% Stake in Suzuki to Raise Cash GENERAL MOTORS: Snobs PBGC's Request for Info on Pensions GENERAL MOTORS: Will Postpone Reimbursement to Dealers GENTIVA HEALTH: Moody's Maintains 'Ba3' Corporate Family Rating GEORGIA MAINTENANCE: Case Summary & 20 Largest Unsec. Creditors GETRAG TRANSMISSION: Case Summary & 20 Largest Unsec. Creditors GETRAG TRANSMISSION: Chrysler Dispute Cues Bankruptcy Filing GLACIER FUNDING: Eroding Credit Quality Cues Moody's Rating Cuts GLOBAL CREDIT: S&P Downgrades Ratings on Preferred Shares to 'CCC' GREEKTOWN HOLDINGS: Exclusive Plan Filing Period Extended Dec. 15 GREENWICH CAPITAL: Fitch Takes Various Rating Actions on Certs. GWLS HOLDINGS: Court OKs Jan. 9 Auction for All Assets HARRAH'S ENTERTAINMENT: Bondholders to Get Cents in Debt Swap HERCULES INC: Ashland Merger Cues S&P's Rating Downgrades HOMESTAR MORTGAGE: High Delinquency Rates Cues Moody's Rating Cuts HOSPITAL PARTNERS: Wants Case Converted to Chapter 7 Liquidation HRP MYRTLE: To Sell Assets for at Least $35-Mil. at Auction IMMUNICON CORP: Court Confirms 4th Amended Plan of Liquidation JEM YELKOVAN: Case Summary & 20 Largest Unsecured Creditors JL BUILDING: Case Summary & 20 Largest Unsecured Creditors JOHN KRETCHMAR: Files Schedules of Assets and Liabilities JOHNSON MEMORIAL: Case Summary & 20 Largest Unsecured Creditors JP MORGAN: Moody's Reviews Ratings on Certs. for Possible Cuts JUPITER HIGH-GRADE: Moody's Downgrades Ratings on Three Classes LAS VEGAS SANDS: Removes Going Concern Doubt After Fund Raising LB-UBS 2007-C6: Fitch Affirms & Puts Low-B Ratings on 6 Classes LIGHTPOINT CLO: S&P Puts Ratings on Two Notes on Negative Watch LSP ENERGY: Moody's Cuts Senior Secured Bond Rating to B3 LYONDELL BASELL: Moody's Downgrades Rating to B3 on High Leverage MACGREGOR DEVELOPMENT: Case Summary & 19 Largest Unsec. Creditors MEHDY GHARACHEHDAGHY: Case Summary & 17 Largest Unsec. Creditors MERVYN'S LLC: Files Schedules of Assets and Liabilities MERVYN'S LLC: Wants to Plan Filing Period Extended Until Feb. 24 MGM MIRAGE: Fitch Assigns 'BB' Rating on $750 Mil. Senior Notes MIDORI CDO: Moody's Downgrades Ratings on Four Classes of Notes MODERN CONTINENTAL: Will Pay $21MM in Damages From Tunnel Collapse MONROE CENTER: Case Summary & 19 Largest Unsecured Creditors MORGAN STANLEY: Moody's Pares Rating on $14.75 Mil. Notes to Ba2 MORGAN STANLEY: Moody's Junks Ratings on $10 Mil. Notes From Ba1 MORGAN STANLEY: Moody's Downgrades Ratings on Two Classes of Notes MORGAN STANLEY: Moody's Downgrades Ratings on $240 Million Notes MORGAN STANLEY: Moody's Downgrades Ratings on Various Note Classes MORGAN STANLEY: Moody's Junks Rating on $50 Million Notes MORGAN STANLEY: Moody's Downgrades Ratings on Two Classes of Notes MORGAN STANLEY: Moody's Junks Ratings on Two Classes of Notes MORRIS PUBLISHING: S&P Downgrades Corporate Credit Rating to 'CCC' MOTOR COACH: Wants Court to Set Jan. 7, 2009, as Claims Bar Date MPC COMPUTRES: Court Approves Logan and Company as Claims Agent NATIONAL WHOLESALE: To Liquidate Stores If It Fails to Find Buyer NORMA CDO: Fitch Downgrades & Withdraws All Classes of Notes NORTEL NETWORKS: May Go Bankrupt Without Cash Injection NORTHLAKE FOODS: Amends List of 20 Largest Unsecured Creditors NR GROUP: Case Summary & 9 Largest Unsecured Creditors PARK VIEW INN: Case Summary & 12 Largest Unsecured Creditors PHILADELPHIA: Wants TARP Funds Due to Dire Fiscal Situation PHOENIX: Wants TARP Funds Due to Dire Fiscal Situation POMARE LTD: May Employ Wagner Choi as Bankruptcy Counsel POMARE LTD: Obtains Final Approval to Use Cash Collateral POMARE LTD: Panel May Employ Thomas T. Ueno as Financial Advisor POMARE LTD: Panel May Employ Case Lombardi as Bankruptcy Counsel POMARE LTD: Taps McCorriston Miller as Special Corporate Counsel RADIO ONE: Moody's Downgrades Corporate Family Rating to 'B3' SCARLET HOTELS: Case Summary & 16 Largest Unsecured Creditors REALOGY CORP: S&P Cuts Ratings to 'CC' on $500 Mil. Note Offering SEAHAWK PROPERTIES: Case Summary & 20 Largest Unsecured Creditors SIMMONS COMPANY: Talks on Forbearance Prompts S&P's Junk Ratings SITE & PIPE: Case Summary & 20 Largest Unsecured Creditors SOLOMONS HOMES: Case Summary & 20 Largest Unsecured Creditors SPANKEY'S AUTO: Voluntary Chapter 11 Case Summary SPARKS REGIONAL: Moody's Slashes Ratings to 'B2' on Cash Decline STEPHEN HUEFFED: Case Summary & 18 Largest Unsecured Creditors STRUCTURED ASSET: Moody's Downgrades Ratings on 75 Tranches SUN MICROSYSTEMS: Will Lay Off Up to 18% of Workforce SUNCAL CENTURY: Involuntary Chapter 11 Case Summary SUNWEST MANAGEMENT: Five Star May Buy 7 Retirement Communities SUPERIOR PLUS: S&P Changes Outlook to Negative; Keeps BB+ Rating SYNTAX-BRILLIAN: Taps Huron Consulting as Forensic Accountants SYNTAX-BRILLIAN: Wants ACT Litigation Agreement Rejected TALLSHIPS FUNDING: Fitch Cuts Ratings on 4 Classes of Notes to 'C' TEXAS FLANGE: Case Summary & 20 Largest Unsecured Creditors Theodore Reece: Case Summary & 20 Largest Unsecured Creditors TOMMY MILLS: Voluntary Chapter 11 Case Summary TRIBUNE CO: S&P Downgrades Ratings on Sr. Unsecured Debt Issues TROPICANA ENTERTAINMENT: Court Extends Removal Period to Dec. 3 TROPICANA ENTERTAINMENT: NJ Commission Extends Sale until Jan. 21 TROPICANA INN: Ct Orders Examination of High Ridge Under Rule 2004 TUBE CITY: S&P Puts 'B+' Corporate Rating on Negative Watch VANGEANT INC: S&P Holds 'B+' Rating & Changes Outlook to Stable VERSANT PROPERTIES: Involuntary Chapter 11 Case Summary VIRGIN MOBILE: Cuts 10% of Workforce in New Jersey and California WYNN RESORTS: Amendment to $1-BB Loan Won't Affect S&P 'BB' Rating * Fitch Provides Update on Recent Gaming Liquidity Trends * Moody's Cuts Ratings on 3 Tranches From Two Transactions * PBGC Reduces FY08 Deficit to $10.7 Billion * S&P Comments on Freddie Mac's $25.3 Billion Third-Quarter Loss * S&P Downgrades Ratings on 60 Tranches From 20 Hybrid CDO Deals * S&P Says Economic Data More Clearly Point to a Recession * Large Companies with Insolvent Balance Sheets ********* AGRIPROCESSORS INC: May Find Financial Help From Outside Investors ------------------------------------------------------------------ Agriprocessors Inc. could find financial aid through outside investors, Jens Manuel Krogstad at WCFcourier.com reports, citing a company employee. The source said that a group of investors toured the plant shortly before Agriprocessors filed for Chapter 11 protection on Nov. 4, 2008, WCFcourier.com relates. Another group will arrive this week, says the report. A deal could be reached within December 2008, WCFcourier.com states, citing the employee. Headquartered in Postville, Iowa, Agriprocessors Inc. -- http://www.agriprocessor.com/-- operates a kosher meat and poultry packing processors located at 220 North West Street. The company maintains an executive office with 50 employees at 5600 First Avenue in Brooklyn, New York. The company filed for Chapter 11 protection on Nov. 4, 2008 (Bankr. E. D. N.Y. Case No. 08-47472). Kevin J. Nash, Esq., at Finkel Goldstein Rosenbloom & Nash represents the company in its restructuring effort. The company listed assets of $100 million to $500 million and debts of $50 million to $100 million. ALDERSGATE FINANCE: Moody's Junks Ratings on Five Classes of Notes ------------------------------------------------------------------ Moody's Investors Service downgraded its rating on these notes issued by Aldersgate Finance Ltd.: Class Description: EUR 39,500,000 Class A (Senior) Floating Rate Credit-Linked Notes -- Prior Rating: Aaa -- Prior Rating Date: Oct. 23, 2003 -- Current Rating: Aa3 Class Description: EUR 100,000,000 Class A Floating Rate Credit- Linked Notes -- Prior Rating: Aaa, on review for possible downgrade -- Prior Rating Date: June 25, 2008 -- Current Rating: Ba2 Class Description: EUR 38,000,000 Class B Floating Rate Credit- Linked Notes -- Prior Rating: Aa2, on review for possible downgrade -- Prior Rating Date: June 25, 2008 -- Current Rating: Ca Class Description: EUR 36,000,000 Class C Floating Rate Credit- Linked Notes -- Prior Rating: A2, on review for possible downgrade -- Prior Rating Date: June 25, 2008 -- Current Rating: Ca Class Description: EUR 14,500,000 Class D Floating Rate Credit- Linked Notes -- Prior Rating: A3, on review for possible downgrade -- Prior Rating Date: June 25, 2008 -- Current Rating: Ca Class Description: EUR 14,000,000 Class E Floating Rate Credit- Linked Notes -- Prior Rating: Baa2, on review for possible downgrade -- Prior Rating Date: June 25, 2008 -- Current Rating: Ca Class Description: EUR 7,500,000 Class F Floating Rate Credit- Linked Notes -- Prior Rating: Baa3, on review for possible downgrade -- Prior Rating Date: June 25, 2008 -- Current Rating: Ca According to Moody's, the rating action is the result of deterioration in the credit quality of the transaction's reference portfolio, which consists of structured finance and corporate securities including but not limited to Lehman Brothers Holdings Inc., which filed for protection under Chapter 11 of the U.S. Bankruptcy Code on Sept. 15, 2008 and Washington Mutual Inc., which was seized by federal regulators on Sept. 25, 2008 and subsequently virtually all of its assets were sold to JPMorgan Chase. ALICE BAUMFALK: Case Summary & 6 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Alice Marie Baumfalk 11193 Orchard Dr Cheyenne, Wy 82009 Bankruptcy Case No.: 08-20718 Chapter 11 Petition Date: November 14, 2008 Court: U.S. Bankruptcy Court District of Wyoming (Cheyenne) Judge: Peter J. McNiff Debtor's Counsel: Ken McCartney The Law Offices of Ken McCartney, P.C. P.O. Box 1364 Cheyenne, WY 82003 307-635-0555 Fax: 307-635-0585 Email: bnkrpcyrep@aol.com Total Assets: $3,549,004 Total Debts: $1,141,807 A list of the Debtor's 6 largest unsecured creditors is available for free at: http://bankrupt.com/misc/wyb08-20718.pdf AMERICAN INTERNATIONAL: Federal Reserve Will Hire Advisers ---------------------------------------------------------- Hugh Son and Scott Lanman at Bloomberg News report that the Federal Reserve Bank of New York is seeking advisers to manage $58.5 billion in securities held or guaranteed by American International Group Inc. According to Bloomberg, the Federal Reserve's board of governors said in a report filed to Congress on Monday that the AIG assets will be managed to maximize repayment on the securities "with minimum disruption to financial markets." Bloomberg relates that the government increased its financial aid on AIG last week to more than $150 billion to protect customers who purchased insurance for fixed-income investments and borrowed securities from the company. The report says that the government, under the new bailout, will set up entities to buy $35 billion in securities guaranteed by AIG and $23.5 billion in residential mortgage-related assets. About American International Group Based in New York, American International Group, Inc. (AIG) is the leading international insurance organization with operation in more than 130 countries and jurisdictions. AIG companies serve commercial, institutional and individual customers through the most extensive worldwide property-casualty and life insurance networks of any insurer. In addition, AIG companies are leading providers of retirement services, financial services and asset management around the world. AIG's common stock is listed on the New York Stock Exchange, as well as the stock exchanges in Ireland and Tokyo. During the third quarter of 2008, requirements to post collateral in connection with AIG Financial Products Corp.'s credit default swap portfolio and other AIGFP transactions and to fund returns of securities lending collateral placed stress on AIG's liquidity. AIG's stock price declined from $22.76 on Sept. 8, 2008, to $4.76 on Sept. 15, 2008. On that date, AIG's long-term debt ratings were downgraded by Standard & Poor's, a division of The McGraw- Hill Companies, Inc., Moody's Investors Service and Fitch Ratings, which triggered additional requirements for liquidity. These and other events severely limited AIG's access to debt and equity markets. On Sept. 22, 2008, AIG entered into an $85 billion revolving credit agreement with the Federal Reserve Bank of New York and, pursuant to the Fed Credit Agreement, AIG agreed to issue 100,000 shares of Series C Perpetual, Convertible, Participating Preferred Stock to a trust for the benefit of the United States Treasury. At Sept. 30, 2008, amounts owed under the facility created pursuant to the Fed Credit Agreement totaled $63 billion, including accrued fees and interest. Since Sept. 30, AIG has borrowed additional amounts under the Fed Facility and has announced plans to sell assets and businesses to repay amounts owed in connection with the Fed Credit Agreement. In addition, subsequent to Sept. 30, 2008, certain of AIG's domestic life insurance subsidiaries entered into an agreement with the NY Fed pursuant to which the NY Fed has borrowed, in return for cash collateral, investment grade fixed maturity securities from the insurance subsidiaries. On Nov. 10, 2008, the U.S. Treasury agreed to purchase, through its Troubled Asset Relief Program, $40 billion of newly issued AIG perpetual preferred shares and warrants to purchase a number of shares of common stock of AIG equal to 2% of the issued and outstanding shares as of the purchase date. All of the proceeds will be used to pay down a portion of the Federal Reserve Bank of New York credit facility. The perpetual preferred shares will carry a 10% coupon with cumulative dividends. AIG and the Fed also agreed to revise the existing FRBNY credit facility. The loan terms were extended from two to five years to give AIG time to complete its planned asset sales in an orderly manner. The equity interest that taxpayers will hold in AIG, coupled with the warrants, will total 79.9%. At Sept. 30, 2008, AIG had $1.022 trillion in total consolidated assets and $950.9 billion in total debts. Shareholders' equity was $71.18 billion, including the addition of $23 billion of consideration received for preferred stock not yet issued. AMERICAN APPAREL: Violates SOF Loan Covenant, Negotiates Terms -------------------------------------------------------------- American Apparel, Inc., disclosed in a regulatory filing with the Securities and Exchange Commission that it has determined that it violated a covenant in its SOF Credit Agreement that prohibited it from making capital expenditures in excess of $50 million for the fiscal year ending December 31, 2008. The default under the SOF Credit Agreement also resulted in a cross default under the revolving credit facility with LaSalle Bank. On November 7, 2008, the company, in its capacity as a facility guarantor under the SOF Credit Agreement, American Apparel (USA), LLC, in its capacity as a borrower, and certain other subsidiaries of the company, in their capacities as facility guarantors under the SOF Credit Agreement, entered into Amendment No. 8 and Waiver to Credit Agreement with SOF Investments, L.P.-Private IV, as lender, to amend the SOF Credit Agreement. The Eighth Amendment waived, as of September 30, 2008, any defaults arising out of the failure to comply with the capital expenditures covenant under the SOF Credit Agreement for the fiscal year ending December 31, 2008, and amended the capital expenditures covenant under the SOF Credit Agreement to increase the limit on the capital expenditures covenant for the fiscal year ending December 31, 2008 to $74 million. The company believes that the increase to the limit on capital expenditures will be sufficient to enable the company to complete planned capital expenditures through the end of the current fiscal year, including capital expenditures expected to be incurred in the fourth quarter of 2008 for new store openings. The Eighth Amendment also cured the cross default under the revolving credit facility. American Apparel completed the $41.0 million secured debt financing from SOF Investments L.P. - Private IV on January 18, 2007. The loan proceeds were used to repay American Apparel's subordinated notes payable held by C3 Capital Partners, L.P., of $15.0 million (including principal, interest and fees), and to repay bank term loans of $5.6 million. Net proceeds related to the secured debt financing amounted to approximately $18.0 million. On July 2, 2007, the company obtained an additional $10.0 million secured debt financing with SOF Investments under the same terms as the original agreement dated January 18, 2007. Indebtedness under the agreement bears interest at 16% per annum, payable monthly and matures on January 18, 2009. The agreement requires the company to meet certain financial covenants. In the event the company is in default under the agreement, the interest rate increases to 21% per annum and the lender has the right to demand payment in full of all outstanding indebtedness. Any prepayment must include a prepayment premium equal to 3% of the amount prepaid. On June 20, 2008, the company, in its capacity as a Facility Guarantor, American Apparel (USA), LLC, in its capacity as Borrower, and certain other subsidiaries of the company, in their capacities as Facility Guarantors, entered into Amendment No. 7 to Credit Agreement with SOF Investments to amend the Credit Agreement, dated as of July 18, 2007. The Seventh Amendment amended the SOF Credit Agreement to, among other things (i) measure financial covenants at the level of the company instead of American Apparel (USA), LLC; (ii) delete the financial covenant relating to Consolidated Fixed Charge Coverage ratio; (iii) increase the Permitted Indebtedness threshold for capital leases from $15.0 million to $20.0 million; (iv) permit the repurchase of up to $30.0 million of the Loan Parties' capital stock if certain conditions are met; (v) provide additional flexibility for investing in foreign subsidiaries; (vi) add the Registrant as a Facility Guarantor; increase the limit on Annual Capital Expenditures to $50.0 million; and (viii) increase the level of Consolidated EBITDA required by the minimum Consolidated EBITDA covenant. The company is evaluating various alternatives to extend, renew or refinance the SOF Credit Agreement, which currently matures on January 18, 2009. If by December 19, 2008, the company is unable to extend or renew the SOF Credit Agreement, or refinance the SOF Credit Agreement on terms acceptable to the lenders under the LaSalle Credit Agreement, all outstanding obligations under the LaSalle Credit Agreement will become due on December 19, 2008. If acceleration of debt obligations were to occur, the company said it cannot be assured that it would be able to obtain alternative financing or that its assets would be sufficient to repay in full its obligations under the debt instruments. The acceleration of any or all amounts due under the SOF loan or other credit facilities could have a material adverse impact on the company's operations which could result in the need for the company to modify its current business plan, curtail operations or affect the company's ability to continue operations as a going concern. At September 30, 2008, the company's revolving credit facility with LaSalle Bank provided for borrowings up to $75.0 million. Borrowings under the facility are subject to certain advance provisions established by the bank and are collateralized by substantially all assets of American Apparel. Interest under the agreement is at LIBOR (3.93% at September 30, 2008) plus 2.5% or the bank's prime rate (5.0% at September 30, 2008) plus 0.5%, at the company's option. The facility expires at the earlier of July 2, 2012 or 30 days prior to the maturity date of the loan agreement with the private investment firm (January 18, 2009) unless it is refinanced on terms acceptable to the bank. The average borrowings under this facility during the nine months ended September 30, 2008 were $51.8 million. On June 20, 2008, the company, in its capacity as Facility Guarantor, American Apparel (USA), LLC, a subsidiary of the company, in its capacity as Lead Borrower, and certain other subsidiaries of the company, in their capacities as Borrowers or Facility Guarantors, entered into a Fourth Amendment to Credit Agreement with LaSalle Business Credit, LLC, LaSalle Bank National Association, Wells Fargo Retail Finance, LLC and the lenders party to the Credit Agreement, dated as of July 2, 2007. The Fourth Amendment amended the LaSalle Credit Agreement to, among other things (i) delete financial covenants relating to minimum Consolidated EBITDA, maximum Capital Expenditures, Consolidated Fixed Charge Coverage Ratio, Senior Debt to Consolidated EBITDA ratio and Adjusted Debt to EBITDAR ratio; (ii) increase Minimum Excess Availability from $3 million to 10% of the lesser of the Borrowing Base and the Revolving Credit Ceiling; (iii) increase the Permitted Indebtedness threshold for capital leases from $15.0 million to $20.0 million; (iv) permit the repurchase of up to $30.0 million of the Loan Parties' capital stock if certain conditions are met; (v) provide additional flexibility for investing in foreign subsidiaries; (vi) add the Registrant as a Facility Guarantor; and (vii) increase from 2.00% to 2.50% the applicable margin for LIBOR-based borrowings and increase from zero to 0.50% the applicable margin for borrowings based on the bank's prime rate. About American Apparel American Apparel, Inc. (NYSE Alternext US: APP) -- http://store.americanapparel.net-- is a vertically integrated manufacturer, distributor, and retailer of branded fashion basic apparel based in downtown Los Angeles, California. As of October 31, 2008, American Apparel employed more than 10,000 people and operated more than 230 retail stores in 19 countries, including the United States, Canada, Mexico, United Kingdom, Belgium, France, Germany, Italy, the Netherlands, Spain, Sweden, Switzerland, Israel, Australia, Japan, South Korea, Austria, China, and Brazil. American Apparel also operates a leading wholesale business that supplies T-shirts and other casual wear to distributors and screen printers. In addition to its retail stores and wholesale operations, American Apparel operates an online retail e-commerce Web site at http://store.americanapparel.net. American Apparel reported net sales for the quarter ended September 30, 2008, of $154.8 million, a 45.2% increase over net sales of $106.6 million for the quarter ended September 30, 2007. Total retail sales increased 65.3% to $97.4 million from $58.9 million for the prior year third quarter, with comparable store sales for stores open at least 12 months rising 24%. American Apparel ended the third quarter of 2008 with 228 stores, having opened 33 stores in the period. The Company operated 163 stores at the end of the third quarter of 2007. Total wholesale sales increased to $46.4 million for the third quarter of 2008, as compared to $41.3 million for the third quarter of 2007, an increase of 12.3%. Online consumer sales increased to $11.0 million from $6.4 million for the prior year third quarter, an increase of 72.0%. The company had $329.0 million in total assets, including $201.3 million in current assets; and $196.3 million in total debts, including $172.1 million in current debts as of September 30, 2008. AMERICAN MEDIA: Defers Interest Payment on 2009 Sr. Sub. Notes -------------------------------------------------------------- American Media, Inc., said last week its subsidiary, American Media Operations, Inc., decided to further defer until Dec. 1, 2008, its decision whether to make the interest payment that was due on Nov. 1, 2008, in respect of its 10-1/4% Series B Senior Subordinated Notes due 2009 (CUSIP Nos. 02744RAH0 and 02744RAM9), taking advantage of a 30-day grace period provided for under the terms of the Notes. Deferment beyond the 30-day grace period could result in a default under the terms of the Notes, as well as a default under AMOI's credit facilities. David Pecker, the Chief Executive Officer of American Media, stated, "We are continuing our discussions with lenders holding more than a majority of the borrowings under our credit facilities and bondholders holding more than a majority of each series of our bonds and believe substantial progress has been made. Therefore, we are deferring the decision whether to make the interest payment until Dec. 1, 2008, and expect to launch an amendment to our senior credit facility by the end of this week as part of this process. Our Board of Directors and our existing equityholders remain fully supportive of these discussions to achieve a financial restructuring of American Media and significantly delever the company." AMOI had earlier deferred interest payment until Nov. 10, 2008. The company's revolving credit commitment under the bank credit agreement entered into by the company on Jan. 30, 2006, matures in January 2012 and the company's term loan under the 2006 Credit Agreement matures in January 2013. The Revolving Facility and the Term Facility both will mature on Feb. 1, 2009, if the company does not refinance at least $389.5 million of its outstanding 10.25% Series B Senior Subordinated Notes due May 1, 2009, on or prior to Feb. 1, 2009. In addition, the Revolving Facility and the Term Facility both will mature on Oct. 15, 2010, if the company does not refinance at least $145.5 million of its outstanding 8.875% Senior Subordinated Notes due Jan. 15, 2011, on or prior to Oct. 15, 2010. The company believes that it is probable that it will be able to complete a refinancing of the 2009 Notes on or prior to Feb. 1, 2009. According to the Troubled Company Reporter on Nov. 3, 2008, AMOI extended the expiration date for, and amended its cash tender offers and consent solicitations in respect of, an aggregate of around $570 million of its outstanding senior subordinated notes. The Tender Offers and Consent Solicitations are being further extended until 5:00 p.m., New York City time, on Nov. 21, 2008, unless further extended. In addition, AMOI amended the terms of the Tender Offers and Consent Solicitations to provide that the Tender Offers and Consent Solicitations are being made to holders of record of Existing Notes as of 5:00 p.m. on Nov. 17, 2008. AMOI also said that it continues to be engaged in discussions with an ad hoc committee of holders of Existing Notes regarding the possible amendment of the Tender Offers and Consent Solicitations. J.P. Morgan Securities Inc. is acting as the Dealer Manager for the Tender Offers and Solicitation Agent for the Consent Solicitations. MacKenzie Partners, Inc. is acting as the Information Agent for the Tender Offers and Consent Solicitations as well as Tabulation Agent for the Consent Solicitations. On Nov. 5, 2008, AMOI said it would host a conference call to update the lenders under its credit facilities with respect to its business. As part of the conference call, the company said it would discuss its financial results for certain completed financial periods and certain other financial information regarding the company, as well as the proposal from the holders of the company's senior subordinated notes regarding restructuring the company. AMI Liquidity -- Fiscal Year 2009 Cash and Debt Service Cash balance @ Nov. 3, 2008 $34,600,000 Term loan principal payments $1,100,000 Due quarterly Indenture interest payments $21,200,000 Due Nov. 1, 2008 Total Debt Credit facility balance @ November 3, 2008 $439,600,000 Revolver balance @ November 3, 2008 $60,000,000 Fully Drawn 2009 Senior subordinated note balance @ Nov. 3, 2008 $414,500,000 2011 Senior subordinated note balance @ November 3, 2008 $155,500,000 --------------- Total Debt $1,069,600,000 =============== With respect to its discussions with bondholders, AMOI disclosed it proposes to issue in $350 million in new senior subordinated notes due April 30, 2013, to participating bondholders. Bondholders will get four board seats. About American Media Headquartered in Boca Raton, Florida, American Media, Inc., is a publisher of celebrity journalism and health and fitness magazines in the U.S., including Star, Shape, Men's Fitness, Fit Pregnancy, Natural Health, and The National Enquirer. In addition to print properties, AMI owns Distribution Services, Inc., the country's number one in-store magazine merchandising company. American Media Operations disclosed in a Securities and Exchange Commission filing that as of June 30, 2008, it balance sheet showed $891.6 million in total assets, $1.29 billion in total liabilities, resulting to $398.7 million in shareholders' deficit. AMOI posted $388,000 in net profit on $118.8 million in net revenues for quarter ended June 30, 2008, compared with $123,000 in net losses on $121.1 million in net revenues for quarter ended June 30, 2007. As of June 30, 2008, the company had cash and cash equivalents of $19.6 million, $26.0 million outstanding on its revolving credit facility, and a working capital deficit of $467.0 million. ASHLAND INC: Moody's Pares Rating to 'Ba2' on Hercules Acquisition ------------------------------------------------------------------ Moody's Investors Service lowered Ashland Inc.'s Corporate Family Rating to Ba2 (from Ba1) following the closing of Ashland's acquisition of Hercules Incorporated. The single notch downgrade, a result of the company's higher leverage, was anticipated when Moody's rated Ashland's proposed acquisition debt in Sept. 2008. The ratings outlook is negative, reflecting Ashland's lower third quarter earnings, lowered expectations for fourth quarter and full year 2009 performance, and uncertainty over the length and depth of the slowdown in the global economy. This completes the review commenced July 11, 2008, after Ashland announced its intention to acquire Hercules. The negative outlook reflects the expectation that Ashland's operating performance in 2009 and 2010 will be weaker than previously anticipated. The Ba2 CFR incorporates the expectation that Ashland will generate at least 5% Free Cash Flow/Debt (including Moody's standard analytical adjustments) and keep its Debt/EBITDA ratio below 3.8x over the next twelve months. Moody's could downgrade the company's ratings if it is unable to adhere to the aforementioned metrics, encounters difficulty in successfully integrating the acquired businesses, or its major end-markets fail to recover over the next two to three years. Moody's confirmed the ratings for the new revolving credit facility and term loans used to finance the Hercules acquisition, which were assigned on Sept. 12, 2008. The Hercules' debt assumed by Ashland was downgraded - 6.5% junior subordinated notes due 2029 to B1 (from Ba2) and 6.60% notes due 2027 to Ba1 (from Baa2). The ratings on Hercules' other debt obligations were confirmed and will be withdrawn upon repayment. Ashland financed part of the acquisition purchase price with a $750 million bridge loan that was previously expected to be refinanced through the issuance of unsecured notes. Given current market conditions, Moody's withdrew the rating on the proposed unsecured notes due 2016 since Ashland will likely maintain the bridge facility; this facility has a term-out option that Ashland can exercise if the high yield market does not recover within the next year. The ratings are: Issuer: Ashland Inc. These ratings were downgraded: -- Corporate Family Rating, Ba2 (from Ba1) -- Probability of Default Rating, Ba2 (from Ba1) -- Senior Unsecured Medium-Term Note Program, Ba3 (from Ba1) 6.86% Senior Unsecured Medium Term Notes due May 1, 2009, Ba3 (LGD5, 76%) from Ba1 (LGD4, 60%) -- 7.72% Senior Unsecured Medium Term Notes due July 15, 2013, Ba3 (LGD5, 76%) from Ba1 (LGD4, 60%) -- 8.38% Senior Unsecured Medium Term Notes due April 1, 2015, Ba3 (LGD5, 76%) from Ba1 (LGD4, 60%) -- Senior Unsecured Regular Bond/Debenture -- 8.8% Senior Unsecured Debentures due Nov. 15, 2012, Ba3 (LGD5, 76%) from Ba1 (LGD4, 60%) These ratings were affirmed: -- $400mm sr sec revolving credit facility due 2013, Ba1 (LGD2, 24%) from Ba1 (LGD2, 25%) -- $400mm sr sec term loan A due 2013, Ba1 (LGD2, 24%) from Ba1 (LGD2, 25%) -- $850mm sr sec term loan B due 2015, Ba1 (LGD2, 24%) from Ba1 (LGD2, 25%) This rating was withdrawn: -- $750mm sr sec notes due 2016, WR from Ba3 (LGD5, 72%) Issuer: Hercules Incorporated These Hercules Incorporated debt assumed by Ashland was downgraded: -- 6.60% Notes due 2027, Ba1 (LGD2, 24%) from Baa2 (LGD2, 15%) -- 6.50% Jr sub debentures due 2029, B1 (LGD6, 91%) from Ba2 (LGD6 92%) These ratings were withdrawn: -- Corporate Family Rating, WR from Ba1 -- Probability of Default Rating, WR from Ba1 -- Senior Secured Bank Credit Facility, WR from Baa2 (LGD2, 15%) These ratings were confirmed and will be withdrawn when repaid: -- Senior Unsecured Regular Bond/Debenture, Ba1 (LGD4, 62%) -- Subord. Conv./Exch. Bond/Debenture, Ba2 (LGD6, 92%) Hercules Incorporated is a leading global supplier of specialty chemicals and related services for the paper, paint, consumer products, construction materials and energy markets. Hercules operates through two business segments the Paper Technologies and Ventures segment and the Aqualon Group and owns a minority interest in FiberVisions, a maker of polyolefin staple fibers, fibers, and yarn as well as polypropylene fibers for the use in such products as personal care, diapers, and wipes. The company had revenues of $2.3 billion for the LTM ended Sept. 30, 2008. Ashland, headquartered in Covington, Kentucky, is a distributor of chemicals and plastics, a manufacturer of specialty chemicals with a focus on performance materials and water technologies and, through its Valvoline brand, a marketer of premium-branded automotive and commercial lubricants. Ashland Inc. and Sud-Chemie AG announced in June 2008 their intention to form a new 50/50 global joint venture to serve foundries that will include Ashland's Casting Solutions business group, the foundry-related businesses of Sud-Chemie and Ashland-Sudchemie-Kernfest GmbH. Ashland had revenues of $8.2 billion for the LTM ended Sept. 30, 2008. ASHLAND INC: S&P Cuts Corporate Rating to 'BB-' on Hercules Merger ------------------------------------------------------------------ Standard & Poor's Ratings Services lowered its ratings on Ashland Inc. and Hercules Inc., including S&P's corporate credit ratings to 'BB-' from 'BB+', upon completion of Ashland's acquisition of Hercules. S&P removed the ratings from CreditWatch where they had been placed on July 11, 2008 with negative implications. The outlook is stable. S&P assigned a 'BB-' senior unsecured debt rating and a recovery rating of '4' to Ashland's $750 million one-year senior unsecured interim credit facility. This indicates S&P's expectation of average (30% to 50%) recovery for these lenders. The lower rating is based on S&P's current expectation of somewhat weaker earnings and cash flow in 2009 than in 2008, versus S&P's earlier expectation that earnings and credit measures would begin to strengthen in 2009. In addition, financing terms are more onerous than indicated in the preliminary plans. Ashland will incur significantly higher borrowing costs than initially expected, and required term loan amortization during the next few years will be somewhat higher. Proceeds of the new credit facilities, along with proceeds from a new $200 million accounts receivable program, cash on hand, and about $180 million of new common equity were used to fund the approximately $3.5 billion acquisition (including fees and expenses) of Hercules. The stable outlook reflects S&P's expectation that following the acquisition of Hercules, Ashland should be more profitable and exhibit more stable financial results. Although discretionary cash flow is likely to be thin during the next two years, S&P expects the majority to be used to reduce debt, and S&P believes financial policies will remain supportive of credit quality. Business challenges include weak economic conditions, volatile raw material costs, and the risk that asbestos or environmental trends could turn negative. ATILLWATER MINING: S&P Puts 'B+' Rating on CreditWatch Negative --------------------------------------------------------------- Standard & Poor's Ratings Services placed its ratings, including its 'B+' corporate credit rating, on Billings, Montana-based Stillwater Mining Co. on CreditWatch with negative implications. "The CreditWatch listing reflects S&P's assessment that the company's near-term operating results will be hurt by the weak global economic conditions and substantially reduced demand from the U.S. automotive industry, a key end market for the company," said Standard & Poor's credit analyst Maurice Austin. The U.S. automotive sector consumes virtually 100% of the company's palladium production and 70% of its platinum production through contracts with Ford Motor Co. and General Motors Corp. The CreditWatch listing also reflects S&P's concerns about the company's reduced mine production as a result of operational inefficiencies and declining metal prices, a trend S&P expects will persist in the near term. In resolving the CreditWatch listing, S&P will reevaluate its expectations for Stillwater's operating performance given challenging operating conditions, including its expected liquidity position. BEAR STEARNS: S&P Affirms Low-B Ratings on 6 Classes of Certs. -------------------------------------------------------------- Standard & Poor's Ratings Services raised its ratings on two classes of commercial mortgage pass-through certificates from Bear Stearns Commercial Mortgage Securities Trust 2002-TOP6. Concurrently, S&P affirmed S&P's ratings on 13 other classes from this series. The upgrades are due to increased credit enhancement levels resulting from a 17% reduction in the mortgage pool balance, as well as the defeasance of the collateral securing 14% ($126.6 million) of the pool. The affirmations reflect credit enhancement levels that provide adequate support through various stress scenarios. As of the Oct. 15, 2008, remittance report, the trust collateral consisted of 133 loans with an aggregate principal balance of $932.6 million, compared with 150 loans totaling $1.118 billion at issuance. The master servicer, Wells Fargo Bank N.A., reported financial information for 98% of the loans in the pool, excluding the defeased loans. Ninety-eight percent of the servicer-reported information was year-end 2007 data. Based on this information, Standard & Poor's calculated a weighted average debt service coverage of 1.84x, up from 1.71x at issuance. All of the loans in the trust are current, and no loans are with the special servicer. The trust has not incurred any losses to date. The top 10 exposures secured by real estate have an aggregate principal balance of $377.5 million (40%) and a weighted average DSC of 1.65x, up from 1.56x at issuance. Standard & Poor's reviewed the property inspection reports provided by Wells Fargo for the assets underlying the top 10 exposures, which characterized the properties as "good." The credit characteristics for four loans were consistent with those of investment-grade rated obligations at issuance. With the exception of one loan, the Regent Court, the loans continue to do so. Details of the three loans that have credit characteristics consistent with investment-grade rated obligations are: -- The Coliseum Centre loan, the largest exposure in the pool ($66.8 million, 7%), is secured by six class A suburban office buildings totaling 974,300 sq. ft. in Charlotte, North Carolina. Wells Fargo reported a 1.33x DSC for the six months ended June 30, 2008, and 86% occupancy as of September 2008. Standard & Poor's adjusted valuation has declined 15% since issuance due to lower occupancy and lower average rental rates. -- The Broadcom Corp. loan, the eighth-largest exposure in the pool ($21.9 million, 2%), is secured by a 200,000-sq.-ft. suburban office/research and development building in San Jose, California. The building is 100% occupied by a single tenant until March 2010. Wells Fargo reported a 2.90x DSC for the 12 months ended Dec. 31, 2007. S&P's adjusted valuation has increased 17% since issuance. -- The Overton Park Plaza loan, the ninth-largest exposure in the pool ($18.3 million, 2%), is secured by a 350,900-sq.-ft. grocery-anchored retail strip center in Fort Worth, Texas. Wells Fargo reported a 2.68x DSC and 96% occupancy for the six months ended June 30, 2008. The loan was paid in full subsequent to the October 2008 remittance report (on Nov. 3, 2008). -- The Regent Court loan, the second-largest exposure in the pool ($64.1 million, 7%), is secured by a class A office complex totaling 566,650 sq. ft. in Dearborn, Michigan. The complex is 100% occupied under a 15-year bondable triple-net lease with Ford Motor Co. (B-/Watch Neg/--). The lease allows Ford to terminate only in the event of casualty or condemnation, and Ford must also prepay the loan in full. Wells Fargo reported a 1.28x DSC for the six months ended June 30, 2008. Although the loan has de-leveraged, Standard & Poor's reanalyzed the loan using market data and information, and $5.9 million of proceeds (9% of the loan balance) are no longer consistent with those of investment- grade rated obligations. S&P considered the current credit rating on Ford in S&P's analysis. Should the rating on Ford continue to decline further, S&P will reexamine the transaction. S&P has credit concerns with the five loans in the pool that reported DSCs below 1.0x. These loans ($12.5 million, 1%) are secured by retail, office, industrial, and self-storage properties. They have an average balance of $2.5 million and have experienced a weighted average decline in DSC of 46% since issuance. Most of the properties securing these five loans have experienced a decline in net cash flow due to low occupancies and/or decreased rental rates. All five of the loans appear on Wells Fargo's watchlist. Wells Fargo reported a watchlist of 12 loans totaling $41.5 million (4%). The largest loan on the watchlist is the New Haven at the Park Apartments ($13.5 million, 1%), which is secured by a 369-unit garden-style apartment complex in Durham, North Carolina. This loan appears on the watchlist because of a low DSC of 1.10x for the 12 months ended Dec. 31, 2007. The property was 89% occupied as of April 2008, and the reported DSC had improved to 1.20x for the six months ended June 30, 2008. The remaining loans are on the watchlist due to declines in DSC since issuance and/or low occupancy. Standard & Poor's identified three nondefeased loans totaling $29.2 million that are secured by properties in areas affected by Hurricane Ike. Wells Fargo indicated that none of the properties securing the three loans incurred any damage. Standard & Poor's stressed the loans on the watchlist and other loans with credit issues as part of its analysis. The resultant credit enhancement levels adequately support the raised and affirmed ratings. Ratings Raised Bear Stearns Commercial Mortgage Securities Trust 2002-TOP6 Commercial mortgage pass-through certificates Rating Class To From Credit enhancement ----- -- ---- ------------------ C AA- A+ 11.09% D A+ A 9.74% Ratings Affirmed Bear Stearns Commercial Mortgage Securities Trust 2002-TOP6 Commercial mortgage pass-through certificates Class Rating Credit enhancement ----- ------ ------------------ A-1 AAA 17.68% A-2 AAA 17.68% B AA+ 14.38% E BBB+ 7.04% F BBB 5.99% G BB+ 4.64% H BB 3.60% J BB- 2.70% K B+ 2.10% L B 1.50% M B- 1.20% X-1 AAA N/A X-2 AAA N/A N/A - Not applicable. BEAR STEARNS: S&P Pares 25 Classes' Ratings on Projected Losses --------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on 25 classes issued by Bear Stearns Alt-A Trust 2005-10. S&P removed 18 of the lowered ratings from CreditWatch with negative implications. Additionally, S&P affirmed S&P's ratings on four other classes and removed one of the affirmed ratings from CreditWatch negative. S&P placed the ratings on CreditWatch on July 29, 2008. The downgrades reflect S&P's opinion that projected credit support for the affected classes is insufficient to maintain the previous ratings given S&P's current projected losses. For this transaction, S&P is projecting a lifetime loss of 12.92% for structure 1 (original balance of $766.048 million). For structure 2 (original balance of $1,931.59 million), S&P is projecting a lifetime loss f 9.12%. The affirmed ratings reflect S&P's belief that the classes have a sufficient amount of credit enhancement available to maintain the current ratings. As of the Oct. 25, 2008, distribution date, cumulative losses, as a percentage of the original pool balance, totaled 5.60% for structure 1 and 3.00% for structure 2. Severely delinquent loans (90-plus days, foreclosures, and real estate owned {REO}), as a percentage of the current balance, totaled 34.53% for structure 1 and 18.28% for structure 2. As part of S&P's analysis, it considered the characteristics of the underlying mortgage collateral as well as S&P's view of macroeconomic influences. For example, S&P's view of the risk profile of the underlying mortgage pools influences its default projections, while its outlook for housing price declines and its view of the health of the housing market influence its loss severity assumptions. To assess the creditworthiness of each class, S&P reviewed the individual delinquency and loss trends of each transaction for changes, if any, in what S&P considers to be risk characteristics, as well as changes in servicing and the classes' expected ability to withstand additional credit deterioration. In order to maintain a rating higher than 'B', S&P considered whether a class could absorb losses in excess of the base-case assumptions S&P assumed in S&P's analysis. For example, under S&P's analysis, one class may have to withstand approximately 115% of S&P's base-case loss assumptions in order to maintain a 'BB' rating, while a different class may have to withstand approximately 125% of S&P's base-case loss assumptions to maintain a 'BBB' rating. S&P expects that a class that has an affirmed 'AAA' rating is able to withstand approximately 150% of S&P's base-case loss assumptions under S&P's analysis, subject to individual caps and qualitative factors that S&P assumed on specific transactions. S&P also took into account the pay structure of each transaction and only stressed each class with losses that S&P expected would occur while it remained outstanding. Additionally, S&P only gave excess interest credit for the amount of time the class would be outstanding. For example, if S&P projected a class to pay down in 15 months, then S&P applied only 15 months of losses to that class. Additionally, in such a case, S&P assumed 15 months of excess spread if the class was structured with excess spread as credit enhancement. Rating Actions Bear Stearns ALT-A Trust 2005-10 Series 2005-10 Rating ------ Class CUSIP To From ----- ----- -- ---- I-1A-1 07386HYW5 A AAA I-1A-2 07386HYX3 BB AAA I-M-1 07386HYY1 CC BBB/Watch Neg I-M-2 07386HYZ8 D BB/Watch Neg I-B-1 07386HZA2 D B/Watch Neg I-B-2 07386HZB0 D CCC I-B-3 07386HZY0 D CCC II-1A-2 07386HZD6 B AAA/Watch Neg II-2A-1 07386HZE4 A AAA/Watch Neg II-2A-2 07386HZF1 B AAA II-3A-2 07386HZH7 B AAA/Watch Neg II-4A-2 07386HZK0 B AAA/Watch Neg II-4X-1 07386HZL8 AAA AAA/Watch Neg II-5A-1 07386HZM6 B AAA/Watch Neg II-5X-1 07386HZN4 B AAA/Watch Neg II-B-1 07386HZP9 CCC AA-/Watch Neg II-B-2 07386HZQ7 CCC BBB+/Watch Neg II-B-3 07386HZR5 CCC BB/Watch Neg II-B-4 07386HZS3 CC BB/Watch Neg II-B-5 07386HZT1 CC B/Watch Neg II-B-6 07386HZU8 CC B/Watch Neg II-B-7 07386HZV6 D B/Watch Neg II-B-8 07386HZW4 D B/Watch Neg II-B-9 07386HZX2 D B/Watch Neg II-B-10 07386HA50 D CCC II-B-11 07386HA68 D CCC Ratings Affirmed Bear Stearns ALT-A Trust 2005-10 Series 2005-10 Class CUSIP Rating ----- ----- ------ II-1A-1 07386HZC8 AAA II-3A-1 07386HZG9 AAA II-4A-1 07386HZJ3 AAA BEAZER HOMES: Reports 38.2% Decline in Home Closings for Sept. Qtr ------------------------------------------------------------------ Beazer Homes USA, Inc., last week provided preliminary fourth quarter home closings and new home orders and its fiscal year ended cash balance. The company's practice is to release the information as part of its quarterly financial reporting, but it provided this information in advance of an upcoming investor conference and investor meetings. The company expects to announce its financial results for the fourth quarter and fiscal year ended Sept. 30, 2008, on Dec. 2, 2008, to provide sufficient time for the company to complete its analysis of whether an 'ownership change' has occurred under Internal Revenue Code Section 382, and the possible impact on the application of the company's net operating loss carryforwards. Home closings for the quarter ended Sept. 30, 2008, totaled 2,441, a 38.2% decline from the same period in the prior fiscal year. Net new home orders totaled 1,083 for the quarter, an increase of 10.3% from the same period in the prior fiscal year. This year- over-year increase was driven largely by a lower cancellation rate of 45.7% during the fourth quarter, compared to 68.1% in the same period of the prior year. The increase in net orders year-over- year was also achieved through a 17.2% increase in net orders in markets where the company maintains a presence, partially offset by a 31.7% decline in net orders in markets the company had previously announced it was exiting. The company noted, however, that the fourth quarter cancellation rate of 45.7% was sequentially higher than the 36.8% cancellation rate for the third quarter of this year, as market conditions continued to deteriorate during the fourth quarter amid further erosion of consumer confidence, heightened concerns about the overall economy, and disruptions in the financial and credit markets. With respect to the company's cash position, at Sept. 30, 2008, the company had a cash balance of $584.3 million, compared to $314.2 million at June 30, 2008 and $454.3 million at Sept. 30, 2007. The Board of Directors of Beazer Homes has set Feb. 5, 2009, as the date for the company's next annual meeting of stockholders. The company set Dec. 8, 2008, as the record date for determining those stockholders entitled to vote at the Stockholder Meeting. Stockholder proposals that are intended to be included in the company's proxy statement relating to the Stockholder Meeting, as well as other stockholder proposals for items of business to be brought before the Stockholder Meeting that are not to be included in the company's proxy statement, must be received by the company no later than Nov. 22, 2008, the date set by the company in accordance with the company's bylaws. To obtain a copy of the relevant bylaw provision or to submit a proposal, a stockholder must submit such a request or proposal in writing to: Beazer Homes USA, Inc. c/o Peggy Caldwell, Acting General Counsel 1000 Abernathy Road, Suite 1200 Atlanta, GA 30328 Beazer Homes USA, Inc. (NYSE: BZH) -- http://www.beazer.com-- headquartered in Atlanta, is one of the country's 10 largest single-family homebuilders with continuing operations in Arizona, California, Delaware, Florida, Georgia, Indiana, Maryland, Nevada, New Jersey, New Mexico, New York, North Carolina, Pennsylvania, South Carolina, Tennessee, Texas, and Virginia. Beazer Homes is listed on the New York Stock Exchange under the ticker symbol "BZH." * * * As disclosed in the Troubled Company Reporter on June 12, 2008, Fitch Ratings downgraded Beazer Homes USA Inc.'s Issuer Default Rating to 'B' from 'B+'; Secured revolving credit facility to 'BB- /RR1' from 'BB/RR1'; Senior notes to 'B-/RR5' from 'B/RR5'; Convertible senior notes to 'B-/RR5' from 'B/RR5'; and Junior subordinated debt to 'CCC/RR6' from 'CCC+/RR6'. BORGER ENERGY: Moody's Reviews 'Ba3' Rating for Possible Upgrade ---------------------------------------------------------------- Moody's Investors Service reviews the Ba3 rating of Borger Energy Associates L.P.'s 7.26% first mortgage bonds due 2022 for possible upgrade. The rating review is prompted by an improvement in operational and financial performance at the plant. Availability at the plant under the terms of the PPA has averaged 93% from 2006 through Sept. 2008 and the debt service coverage ratio calculated by Moody's has improved steadily year over year from 1.29x in 2006 to 1.42x for the trailing 12-months ended Sept. 30, 2008, due at least in part to higher steam sales to ConocoPhillips. The challenges at Borger's facility in 2005 and 2006, which saw much reduced coverage ratios due to the combination of unplanned outages and a reduction in steam revenues, appear to be behind them. The review will focus on whether the improved operating and financial performance is expected to continue. First, the review will specifically address the improved steam sales to ConocoPhillips and whether this is sustainable. Second, the review will assess the prospects for improved cash flow coverage under different scenarios for plant dispatch, gas prices and steam sales. Borger had experienced a downward trend in steam sales beginning in 2005 and by February 2007 the steam sales reached a nadir of 560.62klbs/hr. Since February 2007, Borger's steam sales have increased steadily and have averaged roughly 1,000 klbs/hr over the last twelve months. Third, the review will assess the plant's improved operating performance, resulting from the completion of overhauls and major maintenance activities in 2006, as well as future maintenance requirements, including the possible replacement of the Unit #1 generator in the 2009/2010 timeframe. Finally, the review will assess the 2009 budget and future expected performance of the plant. Borger Energy Associates, L.P. is a limited partnership that owns and operates a 230-megawatt, gas-fired cogeneration facility located near Borger, Texas. Power generated by the project is sold to Southwestern Public Service Company (SPS: Baa1; senior unsecured), a wholly-owned utility operating subsidiary of Xcel Energy (Baa1 senior unsecured), and steam is sold ConocoPhillips Company (ConocoPhillips: A1; senior unsecured). Borger is 100% wholly-owned by affiliates of Energy Investors Funds. BOWNE & CO: Poor Performance Prompts Moody's Rating Downgrades -------------------------------------------------------------- Moody's Investors Service downgraded the corporate family rating of Bowne & Co., Inc. to Ba3 from Ba2 and the rating on its convertible subordinated notes to B2 from B1. The downgrade incorporates the negative impact of the deteriorating performance in Bowne's Capital Markets segment on credit metrics, as well as a weakened liquidity profile. Moody's expected the company's business diversification to enable it to withstand a downturn in the capital markets, but the severity and prolonged nature of the current decline exceeds previous expectations. Furthermore, Bowne utilized its revolver to fund the repayment of the majority of its bonds when bondholders exercised put rights in October. While total debt increased only modestly (due to acquisitions), the revolver usage has reduced external liquidity sources, and the weak operating performance, combined with use of cash for acquisitions, has eroded Bowne's internal sources. Moody's also placed ratings under review for further downgrade. In resolving the review, Moody's will evaluate the cash costs and potential benefits of management's restructuring plans, the outlook for its business in 2009, and the impact of these on the liquidity profile. Given the company's seasonal pattern of cash usage in the first half of the year, Moody's will focus on the company's plans to manage cash needs during this time. Bowne & Co., Inc. -- Probability of Default Rating, Downgraded to Ba3 from Ba2 -- Corporate Family Rating, Downgraded to Ba3 from Ba2 -- Subordinate Convertible Bonds, Downgraded to B2, LGD6, 96% from B1, LGD5, 88% -- Outlook, Changed To Rating Under Review From Stable Bowne's Ba3 corporate family rating reflects the seasonality and volatility of its cash flow and exposure to the capital markets cycle, which has depressed already modest EBITDA margins, as well as some vulnerability to the reduction in demand for printed products. Its moderate debt level, management's track record of successful integration of acquisitions and implementation of cost cutting initiatives, and the considerable stream of recurring revenue support the ratings. In April 2008, Moody's upgraded Bowne's corporate family rating to Ba2 from Ba3, based on improved free cash flow, some margin improvement, and a moderation in the share repurchase program, as well as expectations that adequate business diversification would enable the company to withstand a downturn in capital markets. Bowne & Co., Inc. provides global shareholder and marketing communications services, including capital markets communications, assistance with the preparation and filing of regulatory and shareholder communications online and in print, and the creation and distribution of customized communication on demand. With headquarters in New York, New York, Bowne maintains 60 offices around the globe and has approximately 3,200 employees. Its annual revenue is approximately $800 million. BRADLY VAUGHAN: Case Summary & 36 Largest Unsecured Creditors ------------------------------------------------------------- Debtors: Bradly E. Vaughan Gail M. Vaughan aka dba Shell Superstop aka dba Interstate Shell 76 Alta Vista Drive Marion, AR 72364 Bankruptcy Case No.: 08-17120 Chapter 11 Petition Date: November 14, 2008 Court: U.S. Bankruptcy Court Eastern District of Arkansas (Jonesboro) Judge: Audrey R. Evans Debtors' Counsel: A. Jan Thomas, Aty, Jr., Esq. 306 West Bond Avenue West Memphis, AR 72301-3912 (870) 735-7700 Fax: (870) 735-7438 Email: ajt827@comcast.net Total Assets: $1,494,611 Total Debts: $1,981,939 A list of the Debtors' 36 largest unsecured creditors is available for free at: http://bankrupt.com/misc/akeb08-17120.pdf BUILDERS FIRSTSOURCE: Moody's Junks Corporate Family Rating ----------------------------------------------------------- Moody's Investors Service lowered Builders FirstSource, Inc.'s corporate family rating to Caa1 from B2 and the company's second lien floating rate notes to Caa2 from B3. Moody's also lowered the company's speculative grade liquidity rating to SGL-4 from of SGL-2. The ratings outlook is negative. These ratings and assessments have been affected: -- Corporate family rating, downgraded to Caa1 from B2; -- Probability of default rating, downgraded to Caa1 from B2; -- $275 million guaranteed 2nd priority senior secured floating rate notes due 2012, downgraded to Caa2 (LGD5, 77%) from B3 (LGD5, 77%); -- Speculative grade liquidity rating, downgraded to SGL-4 from SGL-2. The downgrade results from the company's ongoing losses, high financial leverage, negative revenue and earnings trends, and tightening liquidity. The company continues to suffer from the effects of the severe slowdown in new home construction. Moody's currently anticipates the company's EBITDA coverage and free cash flow metrics to deteriorate further in 2009. The negative outlook reflects the potential for additional credit deterioration in 2009, as the company faces slowing demand, continued cash losses, tightening covenants, and a dwindling cash position. The downgrade in the company's SGL rating to SGL-4 from an SGL-2 liquidity rating primarily reflects the expectation that the company will continue to lose cash in 2009, which will reduce the headroom that the company has under its financial covenant on its $350 million borrowing base based revolving credit agreement. The agreement requires it to maintain $35 million of liquidity, defined as cash plus borrowing capacity, or exceed 1.0x EBITDA to Fixed Charges. Based on Moody's estimates this covenant will become increasingly tight by the latter part of 2009 Builders FirstSource, Inc., headquartered in Dallas, Texas, is engaged in the supply and manufacture of structural and related building products to homebuilders for residential new construction in the United States. Its products include prefabricated components, windows and exterior doors, lumber and lumber sheet goods, millwork products, and other building products and services. Builders FirstSource, Inc. was founded as BSL Holdings, Inc. in 1998 by former CEO John Roach and private equity firm JLL Partners. The company went public in June, 2005. Revenues for the LTM period ending in Sept. 2008 were $1.3 billion. BUILDING MATERIALS: Q3 Sales Down 39%; To Close 34 Ailing Units --------------------------------------------------------------- Building Materials Holding Corporation reported that sales for the third quarter of 2008 decreased 39% to $364 million from $594 million in the same quarter a year ago. For the nine months ended September 30, 2008, sales decreased 39% to $1.1 billion from $1.8 billion in the same period of 2007. The company said net loss for the third quarter 2008 was $45.2 million compared to net income of $4.2 million in the same quarter a year ago. For the nine months ended September 30, 2008, net loss was $111.0 million compared to net income of $18.6 million in the same period of 2007. Building Materials reported $736.4 million in total assets, including $426 million in current assets; and $588.8 million in total debts, including $239.4 million in current debts as of September 30, 2008. Building Materials obtained waivers for financial covenants related to its credit facility due to lower than planned operating performance as of both June 2008 and December 2007. On September 30, 2008, Building Materials entered into an amendment to its credit facility with its lenders. The amended credit facility continues to provide a $200 million revolver subject to borrowing base limitations and a $340 million term note maturing in November 2011. As of September 30, 2008, $29.2 million was outstanding under the revolver and $328.9 million was outstanding under the term note. Building Materials' amended credit facility requires monthly compliance with financial covenants including minimum liquidity and adjusted earnings before interest, taxes, depreciation and amortization (monthly Adjusted EBITDA) at least through 2010. If the company's leverage ratio is at a certain maximum as of September 30, 2010, the monthly Adjusted EBITDA may be replaced with quarterly compliance with a leverage ratio and interest coverage ratio. Operating results, particularly income from continuing operations, are a primary factor for the covenants and Building Materials' ability to comply with these covenants depends on its operating performance. The significant and ongoing correction in single-family housing starts has negatively impacted and may continue to negatively impact the company's operating performance. Building Materials noted that the continued challenges in the homebuilding industry may impact its ability to comply with the covenants in the future. If it fails to comply with covenants, Building Materials said it may be in default and the lenders may have the right to cause all amounts borrowed to become due and payable immediately. Reduced operating cash flow and revolver borrowing base limitations may adversely affect its ability to finance operations or capital needs. In May 2008, Building Materials initiated a comprehensive analysis of its businesses operations to improve cash flow and profitability as well as rationalize its operations for the current conditions of the homebuilding industry. The plan places a priority on efficient use of capital and higher returns and focuses on closing and consolidating underperforming business units as well as improving business processes. As a result, by the end of the fourth quarter of 2008, Building Materials said it expects to: -- close 34 underperforming units, -- consolidate 12 underperforming units with other business units, and -- consolidate administrative functions of information systems, reporting, accounts payable and human resources. Building Materials said its restructuring plans do not include formal severance plans for employees affected by the closures and consolidations of underperforming business units or enhancements to administrative functions. Commenting on third quarter results, Robert E. Mellor, Chairman and Chief Executive Officer, stated, "As the unprecedented volatility in the capital markets and the downturn in the homebuilding industry persisted, we remained focused on our goal of realigning our business to the current environment. We made significant progress on our restructuring program during the third quarter, executing on a wide range of operational and financial actions designed to address the impact of the homebuilding industry downturn. Importantly, we successfully negotiated an amendment to our $540 million secured credit facility. Year-to- date, we have reduced selling, general and administrative expenses by $51.2 million, or 16 percent. We continued to enhance our liquidity during the quarter through the wind-down of certain operations and the sale of underperforming business units and excess assets. We remain on track for these and other restructuring initiatives." Mr. Mellor concluded, "While our third quarter financial results continued to be significantly impacted by the difficult operating environment, we are seeing an improvement in our ongoing operations and we comfortably met the bank covenants at the end of the quarter." About Building Materials Based in San Francisco, California, Building Materials Holding Corporation -- http://www.bmhc.com-- provides residential construction services and building products to professional homebuilders and contractors in western and southern regions of the United States. It operates through two business segments: SelectBuild and BMC West. SelectBuild provides framing and other construction services to high-volume homebuilders in key markets. BMC West markets and sells building materials, manufactures building components and provides construction services to professional builders and contractors through a network of 41 distribution facilities and 60 manufacturing facilities. It provides construction services and building products in 16 single- family residential construction markets. In November 2006, SelectBuild acquired the remaining 49% interest in BBP companies. In March 2007, BMHC's subsidiary, SelectBuild Construction Inc., acquired the remaining 27% of Riggs Plumbing LLC. The company's shares were suspended from trading on the New York Stock Exchange in October 2008 as its market capitalization was less than $25 million for a 30 trading-day period. The shares currently trade on the Over-The-Counter Bulletin Board with the symbol "OTCBB: BLGM". * * * As reported in the Troubled Company Reporter on Aug. 13, 2008, Standard & Poor's Ratings Services lowered its ratings on San Francisco, Ca.-based Building Materials Holding Corp., including the corporate credit rating, to 'CCC+' from 'B-'. The ratings remain on CreditWatch with negative implications, where S&P placed them on July 30, 2008. CASEY TOOL: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Casey Tool and Machine Co., Inc. 400 West Delaware Casey, IL 62420 Bankruptcy Case No.: 08-91913 Debtor-affiliates filing separate chapter 11 petitions: Debtor Case No. ------ -------- Consolidated Technology, LLP 08-91914 ICT Mexico, Inc. 08-91915 Related Information: Casey Tool and Machine Co., Inc. and its affiliates manufacture, among other things, residential lighting products -- including indoor and outdoor recessed lighting -- and a successful line of emergency lighting products. Although the lighting portion of the company's business accounts for roughly 85% of total sales, the company also specializes in precision metal stamping and injection molding. The company has roughly 218 employees at four facilities in Illinois, Arizona, and Mexico. In 2007, it had a combined sales of roughly $79,617,635. Chapter 11 Petition Date: November 4, 2008 Court: Central District of Illinois (Danville) Judge: Gerald D. Fines Debtor's Counsel: Harley J. Goldstein, Esq. Matthew E. McClintock, Esq. BELL, BOYD & LLOYD LLP 70 West Madison Street, Suite 3100 Chicago, Illinois 60602-4207 Tel: (312) 372-1121 Fax: (312) 827-8000 Estimated Assets: $10,000,000 to $50,000,000 Estimated Debts: $10,000,000 to $50,000,000 Debtor's list of 20 largest unsecured creditors: Entity Claim Amount ------ ------------ Consolidated Technology LLP $4,160,000 400 West Delaware Casey, IL 62420 GS Battery 539,163 1000 Mansell Excange W., Suite 350 Alpharetta, GA 30022-1501 BYD America Corp. 513,774 1420 Howard St. Elk Grove Village, IL 60007-2221 Westaff 363,649 Blue Cross Blue Shield of Illinois 356,880 B&B Battery (USA) Inc. 340,661 Brecon Ridge Mfg Solutions Corp. 299,661 Ilsung Moolsan Co. Ltd. 296,848 PACINTREX 284,624 Evco Plastics USA Inc. 283,172 Whitehead Die Casting 241,227 Feralloy Corp. 226,784 ISMLL -- Ilsung Moolsan Co. Ltd 191,004 Image Air 168,420 Central Steel & Wire Co. 166,828 Cra Wal Container 164,785 Evans Tool & Die, Inc. 155,414 Clayton Metals, Inc. 136,668 GE Lighting, Inc. 117,664 SAFT America Inc. 128,770 CHAPARRAL ENERGY: S&P Changes CreditWatch Implication to Negative ----------------------------------------------------------------- Standard & Poor's Ratings Services revised the CreditWatch implications on exploration and production company Chaparral Energy Inc. to negative from developing. S&P initially placed the ratings on CreditWatch on July 15, 2008, following its proposed merger with Edge Petroleum Corp. The CreditWatch revision follows the announcement on Chaparral's third-quarter earnings conference call that it may not meet the debt incurrence test of its senior notes, resulting in severely restricted ability to draw from its credit facility after Dec. 31, 2008. If crude oil and natural gas prices stay at current levels, Chaparral's Dec. 31, 2008 SEC PV-10 value could be insufficient to support additional secured debt per the incurrence test. As a result, if the Edge merger is not consummated, S&P would lower ratings as liquidity would be very limited despite Chaparral's goal to live within cash flows. Additionally, if Chaparral fails to sufficiently increase its existing borrowing base, it could potentially be in violation of the working capital covenant in its credit facility. An Edge Petroleum shareholder vote on the merger is scheduled for December 4, at which time Chaparral is aiming to arrange the necessary financing to close the transaction. Specifically, the merger is contingent on a successful refinancing of Chaparral's existing $600 million borrowing-based revolver to $1 billion and a $150 million preferred equity infusion from private equity firm Magnetar Financial LLC. Because of uncertain capital markets and falling commodity prices, Chaparral has struggled to increase its facility to $1 billion and achieve minimum pro forma availability of $325 million, which Magnetar Financial requires as a condition for its $150 million equity injection. In addition, to complete the merger, the NYSE must approve the listing of new shares of Chaparral common stock, which requires a minimum price of $4 per share among other conditions. However, based on Edge's current stock price of around 43 cents, the combined company may have trouble meeting the $4 threshold, particularly in light of the current market malaise and slumping crude oil prices. Chaparral hopes to have the merger financing in place by the December 4 shareholder meeting. S&P will resolve the CreditWatch listing when information regarding progress of the financing and merger become available. A stable outlook would require Chaparral to successfully close the merger with Edge without significantly altering its projected debt leverage or expected liquidity. However, if the merger fails to be completed, S&P would likely lower ratings given expectations of weakened liquidity. CHRYSLER LLC: PBGC Wants More Information on Retirement Plans ------------------------------------------------------------- Cary O'Reilly at Bloomberg News reports that the Pension Benefit Guaranty Corp. spokesperson Gary Pastorius said that the agency wants detailed data on the retirement plans of Ford Motor Co., Chrysler LLC, and General Motors Corp., in case it becomes responsible for the plans. According to Bloomberg News, Mr. Pastorius said in a telephone interview on Monday, "This is pretty much routine" for financially troubled companies with thousands of workers. "We want to be sure we have the latest information," Mr. Pastorius added. Bloomberg relates that GM said on Nov. 7 that it may run short of operating cash by year-end unless the auto market improves or it adds capital and the company, along with Ford and Chrysler, and the Congress is debating a request by the company, Ford Motor, and Chrysler for $25 billion in bridge loans. The PBGC, Bloomberg reports, said in February that it had an accumulated deficit of $14 billion due to an increase in corporate bankruptcies, and declining premium payments as more companies shift from traditional defined-benefit programs to uninsured plans. About Chrysler LLC Headquartered in Auburn Hills, Michigan, Chrysler LLC -- http://www.chrysler.com/-- a unit of Cerberus Capital Management LP, produces Chrysler, Jeep(R), Dodge and Mopar(R) brand vehicles and products. The company has dealers worldwide, including Canada, Mexico, U.S., Germany, France, U.K., Argentina, Brazil, Venezuela, China, Japan and Australia. * * * As reported in the Troubled Company Reporter on Aug. 11, 2008, Standard & Poor's Ratings Services lowered its ratings on Chrysler LLC, including the corporate credit rating, to 'CCC+' from 'B-'. On July 31, 2008, TCR said that Fitch Ratings downgraded the Issuer Default Rating of Chrysler LLC to 'CCC' from 'B-'. The Rating Outlook is Negative. The downgrade reflects Chrysler's restricted access to economic retail financing for its vehicles, which is expected to result in a further step-down in retail volumes. Lack of competitive financing is also expected to result in more costly subvention payments and other forms of sales incentives. Fitch is also concerned with the state of the securitization market and the ability of the automakers to access this market on an economic basis over the near term, given the steep drop in residual values, higher default rates, higher loss severity being experienced and jittery capital market. CITIGROUP INC: To Cut 50,000 Jobs, Raise Credit Card Rates ---------------------------------------------------------- Citigroup Inc. plans to cut more than 50,000 jobs or about 14% of its workforce, Bloomberg TV reports. The report says Citigroup plans to reduce its workforce to 300,000. The bank's headcount peaked at 375,000, according to the report. According to a Marketplace(R) report, Citigroup CEO Vikram Pandit on November 17, 2008, told employees in a company-wide email that he wants to talk about the bank's accomplishment since he took over. Marketplace also reported that the bank may raise credit card rates to certain customers. Marketplace's Jeremy Hobson said the move is intended to make up for a decline in credit card revenue due to fewer offers going out and smaller payments coming in. Citigroup posted a copy of a slide presentation shown to employees at a town hall meeting on Monday. According to the slide show, Citigroup is going into 2009 stronger than 2008, and that its underlying business remains strong, and revenues have been stable. Management expects expenses to be down 20% from peak levels; and that headcount is expected to be down 20% in the near-term from peak levels. A full-text copy of Citigroup's slide presentation is available at no charge at: http://www.citigroup.com/citi/fin/data/p081117a.pdf In October, Citigroup reported a net loss for the 2008 third quarter of $2.8 billion. Results included $4.4 billion in net pre-tax write-downs in Securities and Banking, $4.9 billion in net credit losses, and a $3.9 billion net charge to increase loan loss reserves. Highlights of the third quarter included: * Net interest revenue up 13% and net interest margin up 79 basis points versus the third quarter 2007. * Lower write-downs in Securities and Banking for the third consecutive quarter. * Total expenses declined for the third consecutive quarter, down $1.2 billion since the second quarter 2008. * Headcount reduced by approximately 11,000 since the second quarter 2008 and approximately 23,000 in the first nine months of 2008. * Retail and corporate deposits in the U.S. increased 6% versus second quarter 2008 and 11% versus third quarter 2007. * Total assets declined by $50 billion since second quarter 2008 and by $308 billion since third quarter 2007. * Legacy assets declined by approximately $48 billion since second quarter 2008. * Capital strength maintained with Tier 1 Capital ratio at 8.2%. * Closed sale of CitiStreet; announced sale of Citi Global Services Limited; sale of the German retail banking operations on track for the fourth quarter. In October, Citigroup was foiled in its bid to acquire all of the banking subsidiaries of Wachovia Corporation after Wells Fargo & Co. came into the picture to snag Wachovia. Citi sued for more than $60 billion in damages, citing that it entered into the deal announced September 29, after Wachovia was hit by a $5 billion run on deposits in late September after the failure of Washington Mutual Inc., an Associated Press report says. Citigroup later abandoned talks with Wachovia. Based in New York, Citigroup Inc. (NYSE: C) -- http://www.citigroup.com-- is organized into four major segments -- Consumer Banking, Global Cards, Institutional Clients Group, and Global Wealth Management. Citi had $2.0 trillion in total assets on $1.9 trillion in total liabilities as of September 30, 2008. CITIGROUP MORTGAGE: Fitch Puts Low-B Ratings on Two Note Classes ---------------------------------------------------------------- Fitch Ratings downgrades these classes of Citigroup Commercial Mortgage Trust, series 2007-FL3, commercial mortgage pass-through certificates: -- $19,923,000 class K to 'BB' from 'BBB-'; Outlook Negative; -- $1,504,921 class WES to 'BB+' from 'BBB-'; Outlook Negative. In addition, Fitch affirms and assigns Rating Outlooks to these classes: -- $369,037,174 class A-1 at 'AAA'; Outlook Stable; -- $164,608,000 class A-2 at 'AAA'; Outlook Stable; -- $796,900,000 class X-2 at 'AAA'; Outlook Stable; -- $24,903,000 class B at 'AA+'; Outlook Stable; -- $19,923,000 class C at 'AA'; Outlook Stable; -- $12,949,000 class D at 'AA-'; Outlook Stable; -- $11,954,000 class E at 'A+'; Outlook Stable; -- $12,950,000 class F at 'A'; Outlook Stable; -- $11,953,000 class G at 'A-'; Outlook Stable; -- $11,954,000 class H at 'BBB+'; Outlook Negative; -- $11,953,000 class J at 'BBB'; Outlook Negative; -- $3,800,000 class THH-1 at 'BBB-'; Outlook Stable; -- $2,900,000 class INM at 'BBB-'; Outlook Stable; -- $3,600,000 class MLA-1 at 'BBB'; Outlook Negative; -- $3,200,000 class MLA-2 at 'BBB-'; Outlook Negative; -- $1,900,000 class HTT-1 at 'BBB-'; Outlook Stable; -- $3,000,000 class VSM-1 at 'BBB-'; Outlook Stable; -- $1,000,000 class VSM-2 at 'BBB-'; Outlook Stable; -- $1,200,000 class RSI-1 at 'BBB+'; Outlook Negative; -- $1,600,000 class RSI-2 at 'BBB-'; Outlook Negative; -- $1,900,000 class AVA at 'BBB-'; Outlook Negative; -- $800,000 class MOF at 'BBB-'; Outlook Stable. Classes X-1, HOA-1, HOA-2, HFS-1, HFS-2, and HFS-3 have all paid in full. The downgrade of class K reflects the lowering of the shadow rating of the Fairmont Scottsdale Princess (19.9%), the largest loan in the pool. The Fairmont Scottsdale Princess (19.9%) is a 651-key resort located in Scottsdale, Arizona. Performance at the hotel has weakened as a result of recent renovations and given the current operating conditions, significant performance gains expected at issuance are unlikely to be achieved. The borrower recently exercised one extension option, extending the loan through Sept. 29, 2009 and there are two remaining one-year extension options. The downgrade of class WES reflects the weaker performance of the Westmont Hotel Portfolio following the release of two of the portfolio's larger assets, the Marriott Buffalo and the Marriott Cleveland Airport. The rating affirmations are the result of the remaining assets performing as expected at issuance. The Rating Outlooks reflect the likely direction of rating changes over the next one to two years. Negative Outlooks reflect loans that are behind on their stabilization plans or where economic pressures may make execution of the original business plans less feasible. Classes MLA-1 and MLA-2 have been assigned Negative Outlooks as a result of slower than expected stabilization for the Mondrian Hotel than Fitch assumed at issuance. The Negative Outlook on classes RSI-1 and RSI-2 reflect ongoing weaknesses in the Residence Inn - White Plains' performance following the conclusion of renovations earlier in the year. While the hotel's occupancy and room revenues have improved, operating expenses have risen above expectations at issuance. The Negative Outlook of class AVA-1 reflects deterioration in the Hotel Avalon's performance due to rising operating expenses. As of the October 2008 distribution date, the transaction has paid down by 16.6% to $705.3 million from $845.8 million at issuance. All of the loans are secured by hotel properties, and apart from the Fairmont Scottsdale Princess, all pooled senior participations included in the trust maintain investment-grade shadow ratings. The non-pooled participations interest of nine loans in the trust, The Hudson Hotel, Intercontinental Miami, The Mondrian Hotel, Hotel Thirty-Thirty, Viceroy Santa Monica, The Westmont Portfolio, Residence Inn-White Plains, Hotel Avalon and Maison 140, are structured as rake classes. The thirteen remaining loans in the pool are interest only. The principal reduction since issuance reflects the full payment of Hotel on the Avenue, Holiday Inn Soho and Hotel 57 loans. The second-largest loan is secured by the Radisson Lexington Hotel (14.2%), a 705-key hotel located in New York City, New York. For the trailing twelve month period ending 9/08, the Fitch-stressed DSCR had improved to 3.03 times, compared to 2.35x at issuance. Nearly 80% of the pool's loans mature in 2009 and all have at least one remaining extension option. CITY OF ATLANTA: Wants TARP Funds Due to Dire Fiscal Situation -------------------------------------------------------------- Kris Maher and Paulo Prada at The Wall Street Journal report that the mayors of Philadelphia, Phoenix, and Atlanta asked the Treasury Department on Friday to allocate $50 billion of the $700 billion Troubled Asset Relief Program for infrastructure investment to create jobs and lift local economies. WSJ relates that the mayors also asked for loans to cover short- term borrowing needs and to meet payroll. According to WSJ, the mayors said in a letter to Treasury Secretary Henry Paulson that the cities' dire fiscal situations would result in layoffs and tax increases. WSJ says that the cities had a remote chance to get TARP funding. Mr. Paulson said on Wednesday that the focus of TARP is "to stabilize financial institutions and strengthen the financial system," rather than to provide assistance to state and local governments, according to the report. WSJ states that Philadelphia Mayor Michael Nutter is leading the campaign for federal aid and said that the mayors are targeting TARP because the Congress already approved the program. Many mayors are hoping that the Congress will take some action soon on a "stimulus package" that would include aid to cities, WSJ relates, citing Tom Cochran, the U.S. Conference of Mayors chief. WSJ reports that Philadelphia has a $4 billion budget for next year, faces a $108 million shortfall -- almost half from slower business activity and a decline in sales taxes, and the rest from lower real-estate-transfer and wage taxes. The report quoted the city's budget director Stephen Agostini as saying, "Our revenues have fallen off the table." The report says that Philadelphia's $4 billion pension plan covers 33,000 retirees and had losses of more than $600 million through September 2008. Mayor Shirley Franklin of Atlanta, according to WSJ, told city workers that an expected shortfall of $60 million this year would result in a hiring freeze and a 10% cut in wages and work hours of municipal workers from December 2008 to June 2009. The city already laid off about 350 employees earlier this year, the report states. According to WSJ, Phoenix Mayor Phil Gordon said that his city is facing a $250 million shortfall in its yearly general-fund budget of $1.5 billion. WSJ states that about 60% of the city's budget comes from sales-tax revenue. Phoenix has $250 million of federally approved capital projects, like runway work at the airport and local mass-transit projects, which the city government could have already started if the money were available, the report says, citing Mayor Gordon. COEUR D'ALENE: S&P Puts 'B+' Rating on Negative Watch ----------------------------------------------------- Standard & Poor's Ratings Service placed its ratings, including its 'B?' corporate credit rating, on Coeur d'Alene, Idaho-based Coeur d'Alene Mines Corp. on CreditWatch with negative implications. "The CreditWatch placement follows S&P's assessment that Coeur d'Alene's currently strained liquidity position will worsen dramatically over the next few quarters," said Standard & Poor's credit analyst Sherwin Brandford. "This will create a significant funding gap beginning in the first quarter of 2009 as the company continues to spend aggressively on the development of its new San Bartolome and Palmarejo mines." As a result, S&P expects the company's cash balances to decrease in the near term. In addition, the company's is in danger of being delisted by the NYSE as a result of the significant decline in its equity price, which would be an event of default under its $50 million senior secured notes due 2012. In resolving S&P's CreditWatch, it will meet with the company to discuss its near-term liquidity position in light of the challenging operating conditions. CPG MARKETING: Voluntary Chapter 11 Case Summary ------------------------------------------------ Debtor: CPG Marketing, Inc. 4904 Eisenhower Boulevard, Suite 250 Tampa, FL 33634 Bankruptcy Case No.: 08-18095 Chapter 11 Petition Date: November 14, 2008 Court: Middle District of Florida (Tampa) Judge: Catherine Peek McEwen Debtor's Counsel: Cheryl Thompson, Esq. cthompson@gray-robinson.com Stephenie Biernacki Anthony, Esq. sbiernacki@gray-robinson.com Gray Robinson, PA 201 North Franklin Street, Suite 2200 Tampa, FL 33602 Tel: (813) 273-5076 Fax: (813) 221-4113 Estimated Assets: $1 million to $10 million Estimated Debts: $10 million to $50 million The Debtor did not file a list of 20 largest unsecured creditors. The petitions was signed by the company's president and chief executive officer Daniel D. Granger. CS FIRST: Fitch Takes Rating Actions on Various Classes of Notes ---------------------------------------------------------------- Fitch Ratings downgrades and maintains the Rating Watch Negative on the following non-pooled classes of CS First Boston Mortgage Securities Corp., pass-through certificates, series 2007-TFL2 as: -- $8.9 million class BSL-A at 'BB'; Rating Watch Negative; -- $9.0 million class BSL-B at 'BB'; Rating Watch Negative; -- $8.9 million class BSL-C at 'BB'; Rating Watch Negative; -- $8.9 million class BSL-D at 'BB'; Rating Watch Negative; -- $7.9 million class BSL-E at 'B'; Rating Watch Negative; -- $9.9 million class BSL-F at 'B'; Rating Watch Negative. In addition, Fitch affirms the following classes: -- $521.3 million class A-1 at 'AAA'; Outlook Stable; -- $100 million class A-2 at 'AAA'; Outlook Stable; -- $207 million class A-3 at 'AAA'; Outlook Stable; -- Interest-only class A-X-1 at 'AAA'; Outlook Stable; -- Interest-only class A-X-2 at 'AAA'; Outlook Stable; -- $45.7 million class B at 'AA+'; Outlook Stable; -- $42.6 million class C at 'AA'; Outlook Stable; -- $33.5 million class D at 'AA-'; Outlook Stable; -- $36.6 million class E at 'A+'; Outlook Stable; -- $36.5 million class F at 'A'; Outlook Stable; -- $33.5 million class G at 'A-'; Outlook Stable; -- $39.6 million class H at 'BBB+'; Outlook Negative; -- $36.6 million class J at 'BBB'; Outlook Negative; -- $39.6 million class K from 'BBB-'; Outlook Negative; -- $33.5 million class L at 'BB-'; Outlook Negative. Fitch also affirms these non-pooled components of the related trust assets: -- $90.7 million class CSP-A1 at 'AAA'; Outlook Stable; -- $33.6 million class CSP-A2 at 'AAA'; Outlook Stable; -- Interest-only class CSP-AX at 'AAA'; Outlook Stable; -- $10.6 million class CSP-B at 'AA+'; Outlook Stable; -- $11.5 million class CSP-C at 'AA'; Outlook Stable; -- $9.9 million class CSP-D at 'AA-'; Outlook Stable; -- $10 million class CSP-E at 'A+': Outlook Stable; -- $9.7 million class CSP-F at 'A'; Outlook Stable; -- $19.9 million class CSP-G at 'BBB+'; Outlook Stable; -- $9.9 million class CSP-H at 'BBB'; Outlook Stable; -- $15.9 million class CSP-J at 'BBB-'; Outlook Stable; and -- $18 million class CSP-K at 'BB+'; Outlook Stable. The downgrades of the non-pooled classes reflect the lowering of the shadow ratings of Biscayne Landing. Biscayne Landing (10.9%) was transferred to special servicing for default in January 2008 as the borrower failed to meet the mandatory prepayment of $17 million. An additional payment of $95 million is coming due on Dec. 31, 2008. Fitch considers it unlikely that this payment will be made as scheduled. Any resolution costs or potential losses could be incurred by one or more of the BSL rake classes, which are collateralized by the non-pooled senior portions of the Biscayne Landing loan and are subordinate to the pooled senior portion. The Biscayne Landing loan is secured by a ground lease on the largest undeveloped parcel of urban land in South Florida, consisting of 188 acres in North Miami. While the borrower's original development plan revolved around a master planned community, it has recently gained permission by the city to expand the potential uses for the land to include a greater portion of commercial or hotel space. The Biscayne Landing loan matures on May 9, 2009 and has two one-year extension options. The affirmations are due to expected performance and continued stabilization of the remaining loans since issuance. The Rating Outlooks reflect the likely direction of rating changes over the next one to two years. Negative Outlooks reflect loans that are behind on their stabilization plans or where economic pressures may make execution of the original business plans less feasible. As of the October 2008 distribution date, the transaction's aggregate principal balance has decreased 0.69%. All of the original eight loans remain in the trust. Of the loans scheduled to mature in 2008, all have extension options ranging from two to three years. The largest loan in the pool, Planet Hollywood Resort and Casino (30.7% of the pool) is a hotel and casino in Las Vegas, Nevada, previously operated as the Aladdin. The property is in the midst of a $178 million renovation and re-development project that includes substantial improvements to the facade, casino, restaurants, and guestrooms. Renovations are nearing completion, with the final 1,076 guestrooms on schedule to be completed prior to the 2008 holiday season. Fitch will closely monitor the stabilization of this asset following the conclusion of renovations. The loan was recently extended through 2009 and there are two remaining one-year extension options. The Resorts Atlantic City (11.7%), which was downgraded to below investment grade in August, continues to be a concern. The Resorts Atlantic City is a 942-room casino/hotel located in Atlantic City, New Jersey. Total debt on the loan is $360 million, which consists of a $175 million senior component which is held in the trust and a $185 million junior component held outside the trust. The property's weak performance is attributed to multiple factors: increased competition, a smoking ban introduced throughout the entire Atlantic City gaming market, and the overall negative performance of the gaming industry due to general macro-economic conditions throughout the U.S. Fitch does not expect the cash flow to reach the same levels as at issuance. The transaction consists of loans collateralized by hotel properties (49.1%), office (24%), healthcare (16%), and land (10.9%). All of the loans in the pool mature within the next year but have at least one remaining extension option. CULPEPER CROSSROADS: Asks Court to Dismiss Chapter 11 Case ---------------------------------------------------------- Culpeper Crossroads, LLC, asks the U.S. Bankruptcy Court for the Eastern District of Virginia to dismiss its Chapter 11 case. The Debtor tells the Court that despite considerable effort, it has been unable to propose a confirmable plan of reorganization. The Debtor tells the Court that it owns 6 parcels of contiguous real property located in Culpeper, Virginia, valued at $10,900,000, certain of which are encumbered to Millennium Bank, which is owed $2,745,987. The parcels are also subject to a second trust in favor of Agpro Land, LLC (securing seller financing), which is owed approximately $3,796,466. The Debtor tells the Court that the only firm offer it obtained would have provided Millennium 90% of its outstanding principal while Agro Land would have received $1,000,000 over time. Millennium made it clear, however, that it will not vote to accept any plan which does not provide for full payament of its debt, plus interests and charges. In view of the foregoing, the Debtor has determined that it no longer needs the protection of the Bankruptcy Code, and that it is in its best interests to move to dismiss this bankruptcy case. Headquartered in Warrenton, Virginia, Culpeper Crossroads LLC filed for Chapter 11 protection on May 27, 2008 (Bankr. E.D. Va. Case No. 08-12990). Jennifer D. Larkin, Esq., at Linowes & Blocher LLP, represents the Debtor as counsel. The Debtor's summary of schedules showed total assets of $10,914,099 and total debts of $7,009,841. DBP EXPLORATION: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: DBP Exploration Inc. P.O. Box 1271 Perryton, TX 79070 Bankruptcy Case No.: 08-35815 Chapter 11 Petition Date: November 4, 2008 Court: Northern District of Texas (Dallas) Judge: Stacey G. Jernigan Debtor's Counsel: Susan B. Hersh, Esq. Susan B. Hersh, P.C. 12770 Coit Rd., Suite 1100 Dallas, TX 75251 Tel: (972) 503-7070 E-mail: susan@susanbhershpc.com Estimated Assets: $1,000,000 to $10,000,000 Estimated Debts: $10,000,000 to $50,000,000 Debtor's list of 20 largest unsecured creditors: Entity Claim Amount ------ ------------ First Bank Southwest $830,797 P.O. Box 929 Perryton, TX 79070 First State Bank-Spearman, Texas 736,611 P.O. Box 247 Spearman, TX 79081 Schlumberger Technology Corp. 593,572 P.O. Box 201556 Houston, TX 77216-1556 Schlumberger Technology 131,808 P.O. Box 201193 Houston, TX 77216-1193 Bronco Drilling Co., Inc. 573,354 Boom Drilling, LLC 412,333 Petro-Suisse, Ltd. 412,333 Winter Mud 334,332 Arkhoma Transports, Inc. 136,838 Golden Spread Sales 127,971 Holman Services, Inc. 117,094 Smith International, Inc. 116,412 James W. Clark Dirt Contractor, Inc. 111,865 Hays Trucking Co., LLC 103,268 Trencor Enterprises Inc. 84,232 Western Hot Oil Service, Inc. 70,971 CASE Wireline Services, Inc. 70,645 Joe E. Curtis Production Co., LTD 60,000 Kruse Farms, LP 60,000 Nabors Well Services Co. 56,927 DBSI INC: Taps Young Conaway Stargatt as Attorney ------------------------------------------------- DBSI Inc. and its debtor-affiliates ask the United States Bankruptcy Court for the District of Delaware for permission to employ Young Conaway Stargatt & Taylor LLP as their attorney. The firm is expected to: a) provide legal advice with respect to the Debtors' powers and duties as debtors in possession in the continued operation of their business, management of their properties and sale of their assets; b) prepare and pursue confirmation of a plan and approval of a disclosure statement; c) prepare on behalf of the Debtors necessary applications, motions, answers, orders, reports and other legal papers; d) appear in Court and protect the interest of the Debtors before the Court; and e) perform all other legal advice for the Debtors which may be necessary and proper in these proceedings. The firm's professionals and their compensation rates are: Professionals Hourly Rates ------------- ------------ James L. Patton, Jr., Esq. $750 Michael R. Nestor, Esq. $505 Joseph M. Barry, Esq. $390 Kenneth J. Enos, Esq. $290 Nathan D. Grow, Esq. $260 Robert F. Poppiti, Jr., Esq. $240 Kim Beck $175 Michael R. Nestor, Esq., a partner of the firm, assures the Court that the firm does not hold any interests adverse to the Debtors' estate and their creditors, and is a "disintereste person" as defined in Section 101(14) of the Bankruptcy Code. Headquartered in Meridian, Idaho, DBSI Inc. -- http://www.dbsi.com -- operates a real estate company. The company and 145 of its affiliates filed for Chapter 11 protection on Nov. 10, 2008 (Bankr. D. Del. Lead Case No. 08-12687). Kurztman Carson Consultants LLC represents as the Debtors' notice claims and balloting agent. When the Debtors filed for protection from their creditors, they listed assets and debts between $100 million and $500 million each. DBSI INC: Blames Rising Operating Costs for Bankruptcy ------------------------------------------------------ DBSI Inc.'s CEO Douglas Swenson blamed the company's bankruptcy on increasing operating costs, weakness in leasing, and the "unprecedented events" in the real-estate and financial markets, court documents say. Alex Frangos at The Wall Street Journal reports that DBSI's bankruptcy has tossed at least 8,500 investors and almost 240 commercial properties valued at $2.4 billion in over 30 states. WSJ quoted Stephen Burr -- the attorney for DBSI -? as saying, "The bankruptcy filing was necessary to create an orderly process for the maximum return for all DBSI's creditors including its investors." According to WSJ, DBSI operated under names like Spectrus Real Estate and For 1031 LLC, and guaranteed returns that investors would receive from properties -- 6.5% and growing over time to 12% yearly. WSJ relates that under the DBSI arrangement, if one property wasn't performing well, the company could use profits from another to make up the difference. The company, says the report, could use the fees and markups it made arranging new tenant-in-common (TIC) deals to feed the older ones. There wasn't enough cash to meet the company's obligations when the market seized, according to the report. WSJ relates that DBSI stopped making monthly distributions in October 2008, panicking its TIC investors. The report quoted Ruth Cook, a 72-year-old widow from College Park, Maryland, as saying, "It really is devastating for a lot of us that trusted them." Mrs. Cook, according to the report, relied on a $440,000 DBSI investment to generate $2,000 per month -- about half her living expenses. Court documents and people familiar with the matter say that it isn't clear yet how much money people will lose through DBSI. According to WsJ, some investors will be forced to inject more capital or lose their properties to foreclosure. WSJ says that each TIC investment contains as many as 35 investors who must make all major decisions unanimously. WSJ relates that DBSI collected more than $1 billion in investor equity through TIC offerings, amassing a portfolio of office buildings, strip malls, medical buildings, and apartments. DBSI, according to the report, also had investments in raw land and development projects and raised about $275 million from thousands of small investors through private bond placements. The company has several small technology firms, the report states. According to WSJ, Paul Mangiantini, an attorney representing investors who sued DBSI in Idaho State Court, said, "The way their real-estate TIC offerings were made...was unsustainable." Mr. Mangiantini alleged that DBSI collapsed when real-estate markets prevented the firm from "sourcing new deals to feed what it owed on the old ones," WSJ states. About DBSI Idaho-based DBSI Inc. -- http://www.dbsi.com-- is a privately held real-estate firm. The company was founded in 1980. It was a leader in tenant-in-common, or TIC, real-estate transactions. The company filed for Chapter 11 protection on Nov. 10, 2008 (Bankr. D. Delaware Case No. 08-12687). James L. Patton, Esq., Joseph M. Barry, Esq., and Michael R. Nestor, Esq., at Young, Conaway, Stargatt & Taylor LLP represent the company in its restructuring effort. Kurztman Carson at Consultants LLC is the claims agent. The company listed assets of $100 million to $500 million and debts of $100 million to $500 million. DELPHI CORP: Cancels Dec. 31 Bankruptcy Emergence Timetable ----------------------------------------------------------- Delphi Corp. has signed deals with General Motors Corp. and its DIP Lenders, led by JPMorgan Chase Bank, N.A., in order to have access to borrowed cash until mid-2009. The Debtors' financing deals mature Dec. 31, 2008. As previously reported, on Oct. 3, the Debtors submitted proposed modifications to their Plan of Reorganization. Under the modified plan, the Debtors targeted a Dec. 17 confirmation hearing, and a Chapter 11 exit by year-end. The modified plan does not require, in addition to $4,700,000,000 of debt exit financing, a $2,550,000,000 cash-for-equity investment by Appaloosa Management, L.P., and other "plan investors", which were the highlight of the Court-confirmed, but unconsummated, Jan. 25, 2008 PoR. The modified plan requires debt exit financing of $2.75 billion plus a $1,000,000,000 raised through a rights offering. The preliminary hearing to consider approval to the Modified Plan has been adjourned for the second time -- to November 21, 2008. The hearing was originally scheduled for October 23, 2008. Delphi, however, has said that "in the face of the current unprecedented turbulence in the credit markets and uncertainty in the automobile industry," it does not anticipate emerging from chapter 11 prior to December 31, 2008, when its financing deals mature. "Despite the efforts of the federal government to provide stability to the capital markets and banks, the markets have remained extremely volatile and liquidity in the capital markets has been nearly frozen, resulting in an unprecedented challenge for the Debtors to successfully attract emergence capital funding for their Modified Plan, particularly in light of the current conditions in the global automotive industry," John Wm. Butler, Jr., Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, in Chicago, Illinois, said, in a court filing. In its third quarter report on Form 10-Q, General Motors Corp., Delphi's primary customer, admitted, "Given the current credit markets and the challenges facing the automotive industry, there can be no assurance that Delphi will be successful in obtaining $3.8 billion in exit financing to emerge from bankruptcy." GM has recorded Delphi-related charges $4.1 billion for nine months ended Sept. 30, 2008. GM recorded a net loss of $2,542,000,000 on $37,503,000,000 of revenues for three months ended Sept. 30, 2008, compared with a net loss of $38,963,000,000 on $43,002,000,000 of sales during the same period in 2007. General Motors, along with Ford Motor Company and Chrysler LLC, has asked Congress to grant the U.S. carmakers access to $25 billion of the $700 billion Troubled Asset Relief Program approved by Congress to bail out financial institutions. Congress is expected to tackle on Nov. 18 and 19 the proposed bailout, which, according to reports, may be necessary to save the U.S. automakers from collapse or bankruptcy. A bankruptcy filing for GM could shatter its former unit Delphi's plans to finally exit bankruptcy this year or early next year, according to a report by Bloomberg News. "If GM fails, it's likely the Delphi reorganization fails, and Delphi converts to a case under Chapter 7 -- a liquidation," Nancy Rapoport, a law professor at the University of Nevada-Las Vegas, in an e-mail, according to Bloomberg News. "For the creditors of Delphi, this of course isn't optimal, and the usual issues in Chapter 7, determining the liquidation value of the company, will apply." About Delphi Corp. Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ) -- http://www.delphi.com/-- is the single supplier of vehicle electronics, transportation components, integrated systems and modules, and other electronic technology. The company's technology and products are present in more than 75 million vehicles on the road worldwide. Delphi has regional headquarters in Japan, Brazil and France. The company filed for Chapter 11 protection on Oct. 8, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP, represent the Official Committee of Unsecured Creditors. As of June 30, 2008, the Debtors' balance sheet showed US$9,162,000,000 in total assets and US$23,742,000,000 in total debts. The Court approved Delphi's First Amended Joint Disclosure Statement and related solicitation procedures for the solicitation of votes on the First Amended Plan on Dec. 20, 2007. The Court confirmed the Debtors' First Amended Plan on Jan. 25, 2008. The Plan has not been consummated after a group led by Appaloosa Management, L.P., backed out from their proposal to provide US$2,550,000,000 in equity financing to Delphi. (Delphi Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) DELPHI CORP: Signs 2 Gm Deals For Liquidity Until Mid-2009 ---------------------------------------------------------- Delphi Corp. and its affiliates seek authority from the U.S. Bankruptcy Court for the Southern District of New York to enhance their liquidity through June 30, 2009 by entering into two agreements with General Motors Corp. First, the Debtors seek authority to amend and extend, through June 30, 2009, their current arrangement with GM pursuant to which GM has agreed to provide up to $300 million of liquidity enhancement. Second, the Debtors seek authority to enter into a new agreement with GM whereby GM would provide an additional aggregate $300 million during the second quarter of 2009 through a temporary acceleration of its accounts payable to the Debtors. The two agreements will afford the Debtors additional liquidity of up to $600 million through the end of the second quarter of 2009. This will also provide the Debtors the time to seek sufficient emergence funding capital to allow them to emerge from chapter 11 as soon as practicable. John Wm. Butler, Jr., Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, in Chicago, Illinois, relates that through the Second Amendment Agreement and the Partial Temporary Accelerated Payment Agreement, GM would provide additional liquidity to the Debtors through the second quarter of 2009, during the period covered by the accommodation agreement with certain of the DIP Lenders. The Debtors believe that the liquidity provided by the agreements with GM should help facilitate their plan modifications and emergence strategy while addressing the concerns of Delphi's customers and suppliers. The Court will convene a hearing to consider the Debtors' proposal on November 24, 2008 at 10:00 a.m. Objections are due November 20, 2008 at 4:00 p.m. More GM Support to Delphi According to Mr. Butler, the relief sought by Delphi reflects GM's further support for the Debtors' reorganization efforts. GM has already made significant and substantial contributions to the Debtors' reorganization efforts. On September 26, 2008, the Debtors received the authority to implement the Amended GSA and the Amended MRA, which agreements became effective on September 29, 2008. The Amended GSA and Amended MRA, among other things, produced $4.6 billion in incremental net contributions to Delphi from GM (resulting in an expected net contribution from GM in the approximate amount of $10.6 billion), pulled forward GM's financial obligations under the global settlement agreement and master restructuring agreement approved as part of the Plan to the effective date of the Amended GSA and Amended MRA, made all of GM's incremental financial contributions in the Amended GSA and Amended MRA immediately and unconditionally effective on the effective date of the Amended GSA and Amended MRA, eliminated substantially all of GM's termination rights, and eliminated substantial conditional aspects of the Original GSA and Original MRA. The agreements became effective on September 29, 2008, and the Debtors and GM executed the first step of the section 414(l) transfer on that date, transferring approximately $2.1 billion of the Debtors' net unfunded hourly pension liabilities to GM's pension plan. Delphi Couldn't Find Exit Financing Amid Worst Bear Market Following the implementation of the Amended GSA and the Amended MRA, the Debtors continued to take steps toward emergence from chapter 11. On October 3, 2008, the Debtors filed the Plan Modification Approval Motion which included the Debtors' revised emergence business plan and enterprise valuation. That same day, the United States House of Representatives approved the federal bailout plan, now known as the Troubled Asset Relief Program or "TARP." However, on the following Monday, and for much of the rest of the month of October, the global credit markets seized up and experienced one of the five worst bear markets in history. Despite the efforts of the federal government to provide stability to the capital markets and banks, the markets have remained extremely volatile and liquidity in the capital markets has been nearly frozen, resulting in an unprecedented challenge for the Debtors to successfully attract emergence capital funding for their Modified Plan, particularly in light of the current conditions in the global automotive industry, Mr. Butler explains. "Nevertheless, assuming that this Court approves this Motion and the Accommodation Motion, the Debtors will continue to work with their stakeholders in an effort to emerge from chapter 11 as quickly as practicable despite the difficult economic environment," Mr. Butler avers. Amended GM Arrangement The Amended GM Arrangement, as modified by the Second Amendment Agreement, functions as an adjunct to the Debtors' $4-billion DIP financing facility, effectively providing Delphi with $300 million in additional unsecured, subordinated advancements from GM, thereby continuing a definite and reliable source of liquidity during an extended period of uncertainty in the capital markets generally and the automotive industry in particular. Under the terms of the Second Amendment Agreement, GM has agreed, subject to this Court's approval, to make available to the Debtors up to $300 million through the maturity date of the Second Amendment Agreement, subject to certain modified borrowing mechanics and provided that certain conditions are met. The maturity date for the Second Amendment Agreement will be the earliest of: (i) June 30, 2009, (ii) the date on which Delphi or any guarantor of the GM Arrangement files any motion or other pleading seeking to amend the Plan or Disclosure Statement filed by the Debtors on October 3, 2008 in a manner not reasonably acceptable to GM, (iii) the DIP Termination Date, (iv) on or after January 1, 2009, the expiration or termination of the Accommodation Agreement or the Accommodation Period, and (v) the occurrence of the effective date of the Plan. In addition, certain modifications were made to the Amended GM Arrangement that protects GM in the event the Accommodation Agreement is modified in a manner adverse to GM. In such circumstance, to the extent that Delphi seeks continued access to the Second Amended GM Arrangement, GM would have approval rights with respect to such modifications to the Accommodation Agreement. Other proposed modifications to the Amended GM Arrangement are largely technical and conforming changes. Effectiveness of the Second Amendment Agreement is conditioned on, among other things, (i) the Debtors having no Automatic Accommodation Termination Default and no Accommodation Default and (ii) entry of a final, non-appealable order by the Court approving the Accommodation Agreement and the Second Amendment Agreement on or prior to December 31, 2008. Upon the effectiveness of the Second Amendment Agreement, the terms and conditions of the Amended GM Arrangement will remain in full force and effect, including the provisions that GM and its relevant Affiliates will have (a) allowed claims with administrative expense priority pursuant to Section 503(b)(1) of the Bankruptcy Code against Delphi and the GM Guarantors under and as defined in the DIP Credit Agreement for all Obligations owing to GM or any applicable GM Affiliates and (b) all other rights under the Amended GM Arrangement and the Second Amendment Agreement, including, without limitation, the ability to exercise the right to set off and apply, subject to the terms of the Amended GM Arrangement and the Second Amendment Agreement, any indebtedness or liabilities owing by GM or the GM Affiliates to or for the credit or the account of Delphi or the GM Guarantors against any and all GM Arrangement Obligations of Delphi or the GM Guarantors without the need to seek additional modification of the automatic stay imposed pursuant to Section 362 of the Bankruptcy Code and without further order of the Court. Pursuant to a side letter between Delphi and GM, GM has agreed that prior to the earlier of (i) the occurrence of the DIP Termination Date, (ii) the effectiveness of the Debtors' plan of reorganization, or (iii) the receipt of DIP Agent consent, GM will not assert or exercise against any of the GM GSA Claims any setoff of any amounts payable by GM or any of its Affiliates to Delphi or any of its affiliates. The GM GSA Claims are the First Net Liability Transfer Claim, the Second Net Liability Transfer Claim, and the GM Unsecured Claim. The Side Letter does not prejudice other parties' rights to contest GM's setoff rights if (a) the Side Letter does not become effective or (b) one of the events set forth in clauses (i)-(iii) above has occurred. The Side Letter will become effective on the date when all of the conditions precedent set forth in section 3 of the Second Amendment Agreement have been satisfied or waived. Copies of the New GM Agreements are available at no charge at http://bankrupt.com/misc/Delphi_GM_DealsNov08.pdf About Delphi Corp. Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ) -- http://www.delphi.com/-- is the single supplier of vehicle electronics, transportation components, integrated systems and modules, and other electronic technology. The company's technology and products are present in more than 75 million vehicles on the road worldwide. Delphi has regional headquarters in Japan, Brazil and France. The company filed for Chapter 11 protection on Oct. 8, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP, represent the Official Committee of Unsecured Creditors. As of June 30, 2008, the Debtors' balance sheet showed US$9,162,000,000 in total assets and US$23,742,000,000 in total debts. The Court approved Delphi's First Amended Joint Disclosure Statement and related solicitation procedures for the solicitation of votes on the First Amended Plan on Dec. 20, 2007. The Court confirmed the Debtors' First Amended Plan on Jan. 25, 2008. The Plan has not been consummated after a group led by Appaloosa Management, L.P., backed out from their proposal to provide US$2,550,000,000 in equity financing to Delphi. (Delphi Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) DELPHI CORP: To Sell Exhaust Biz.; Mexican Firm is Lead Bidder -------------------------------------------------------------- Delphi Corp., and its debtor affiliates Delphi Automotive Systems LLC, and Delphi Technologies, Inc., seek the U.S. Bankruptcy Court for the Southern District of New York's approval to sell their exhaust business to Bienes Turgon S.A. de C.V., subject to further market test through an auction on December 11. The Court will convene a hearing on Nov. 24 to Delphi's request to pursue a bidding process for its exhaust business. Objections are due November 20, 2008 at 4:00 p.m. John Wm. Butler, Jr., Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, in Chicago, Illinois, relates that as part of its transformation plan, Delphi has identified its exhaust business as a non-core business subject to disposition. Accordingly, following broad marketing efforts, on November 10, 2008, Delphi Corp. and its debtor and non-debtor affiliates entered into a Master Sale and Purchase Agreement with Bienes Turgon S.A. de C.V. The Agreement contemplates a global divestiture of the Exhaust Business to Bienes Turgon for a purchase price of $17 million, subject to certain adjustments. Sale of Global Exhaust Biz. Delphi's global exhaust emissions business produces a broad array of catalytic converters and related assemblies that are sold globally and used in a variety of gas and diesel emissions control applications. The company began making catalytic converters in 1974 as the AC Spark Plug division of GM and at the time of the Spin-Off, the operations became part of Delphi. The Exhaust Business is part of Delphi's Powertrain business, a core business of the Company. The Exhaust Business has a global platform with operations at six primary manufacturing sites in Australia, China, India, Mexico, Poland, and South Africa, all of which -- other than the Mexican and South African sites -- also manufacture other Delphi products. Except for the Mexican site where Delphi Entities hold a minority interest in one joint venture, Katcon S.A. de C.V., all sites are wholly-owned or controlled by the Delphi Entities. Sixty percent of the Katcon joint venture is owned by Bienes Turgon and 40% is owned by Delphi Corp's non-Debtor affiliate, Delphi Controladora, S.A. de C.V. Delphi Automotive Systems (Holding), Inc. owns 99.99% of DCSA, and Delphi International Holdings Corp. owns .01% of DCSA. Both DASHI and DIH are Debtors. Pursuant to this transaction, the applicable non-Debtor Seller will be selling its equity interest in Katcon. In addition to certain engineering capabilities at the manufacturing sites, the Exhaust Business also has engineering resources located at technical centers in Luxembourg and Michigan where engineering personnel carry out their responsibilities to develop and test the Exhaust Business' products and associated processes. The dedicated workforce for the Exhaust Business is comprised of approximately 135 salaried and 158 hourly employees. Of these employees, 23 are U.S. employees, all of whom are salaried employees (primarily engineers). The Exhaust Business is benefiting because of increasingly stringent regulatory exhaust emission requirements in the global market which aim to reduce noxious emissions. For the year ended December 31, 2007, the Exhaust Business achieved revenue of $294.4 million and EBITDA of $19.1 million on a pro-forma basis, excluding certain Delphi Because of the increasingly stringent environmental requirements, the company believes that with the right buyer, the Exhaust Business has strong growth prospects. The revenue from the Exhaust Business is comprised of two different value streams: (i) 76% is through a customer-directed purchase process through which the Delphi Entities obtain catalyst material from a specified supplier and pass it to the customer, receiving a handling fee but not otherwise adding value to the product and (ii) 24% is generated from sale of product to which Delphi has added content, thereby increasing its value. Nearly two-thirds of the Exhaust Business sales are to GM and its affiliates, virtually all of which is sold outside of the U.S. In addition to its customer relationship with GM, the Exhaust Business has customer relationships with many other leading original equipment manufacturers, including AvtoVAZ, Brilliance, Ford, and Renault. Marketing Efforts Began in June Delphi has actively marketed the Exhaust Business since June 2008. As part of this process, the Company contacted more than 200 potential global buyers, distributed over 50 confidential information memorandums, and provided a number of parties with additional information about the Exhaust Business. In their business judgment the Delphi Entities concluded that the proposal from Bienes Turgon offered the most advantageous terms and the greatest economic benefit. This decision was based in part on the Delphi Entities' ability to maximize the value of the business line as a going concern and their belief that Bienes Turgon would continue to provide quality products to the Company's customers, many of whom buy other products from Delphi. The Buyer is a well-established private investment company based in Mexico. Among its portfolio companies, the Buyer is currently partnered with a non-debtor affiliate of Delphi in the Katcon joint venture, a manufacturer of catalytic converters (the 40% non-Debtor ownership interest of which is being sold pursuant to the Agreement). Importantly, Bienes Turgon has enough available cash to close the transaction and has required no financing conditions in the Agreement. Bidding Procedures The Sale of the Exhaust Business would be subject to higher or otherwise better offers. The Debtors propose a December 8, 2008 at 11 a.m. (prevailing Eastern time) deadline to submit bids for the Exhaust Business. In light of the short timeframe, the Debtors are commencing the process of contacting potential bidders and will open the virtual data room to such parties even prior to Nov. 24 hearing. Bids must at least have a value equal to the purchase price plus the amount of the Break-Up Fee, plus $650,000 (approximately $18,160,000). If the Selling Debtor Entities receive at least one "qualified bid" in addition to that of the Bienes Turgon, they would conduct an auction on December 11, 2008. Delphi will seek approval of the sale to Bienes Turgon or to the winning bidder on December 17, 2008 at 10:00 a.m. Objections are due December 10, 2008 at 4:00 p.m. About Delphi Corp. Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ) -- http://www.delphi.com/-- is the single supplier of vehicle electronics, transportation components, integrated systems and modules, and other electronic technology. The company's technology and products are present in more than 75 million vehicles on the road worldwide. Delphi has regional headquarters in Japan, Brazil and France. The company filed for Chapter 11 protection on Oct. 8, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP, represent the Official Committee of Unsecured Creditors. As of June 30, 2008, the Debtors' balance sheet showed US$9,162,000,000 in total assets and US$23,742,000,000 in total debts. The Court approved Delphi's First Amended Joint Disclosure Statement and related solicitation procedures for the solicitation of votes on the First Amended Plan on Dec. 20, 2007. The Court confirmed the Debtors' First Amended Plan on Jan. 25, 2008. The Plan has not been consummated after a group led by Appaloosa Management, L.P., backed out from their proposal to provide US$2,550,000,000 in equity financing to Delphi. (Delphi Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) DELPHI CORP: To Seek 6-Month Extension of $4.35-Bil. DIP Loan ------------------------------------------------------------- Delphi Corporation said in a regulatory filing two weeks ago that it is seeking to amend and extend until the earlier of June 30, 2009, or the effective date of its reorganization plan, its existing debtor-in-possession credit facility. The Debtors have filed with the U.S. Bankruptcy Court for the Southern District of New York a motion seeking authority to continue their use of the proceeds from their DIP Facility through June 30, 2009 by entering into an accommodation agreement with JPMorgan Chase Bank, N.A., as administrative agent, and certain lenders. A full-text copy of the Accommodation Agreement also signed by, among others, Bank of America, N.A., General Electric Capital Corporation and Wachovia Capital Finance Corporation, as lender parties, is available for free at: http://bankrupt.com/misc/Delphi_DIP_AccomDeals.pdf The Court will convene a hearing to consider the Debtors' proposal on November 24, 2008 at 10:00 a.m. Objections are due November 20, 2008 at 4:00 p.m. To recall, the Debtors' $4,350,000,000 DIP facility comprises: Tranche Facility ------- -------- A $1,100,000,000 first priority revolving Credit facility B $500,000,000 first priority term loan C Approximately $2,750,000,000 second priority term loan. John Wm. Butler, Jr., Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, in Chicago, Illinois, relates that the Accommodation Agreement reflects the support of JPMorgan and the anticipated support of the requisite lenders for the Debtors' turnaround efforts, despite the current economic downturn and the unprecedented turmoil in the capital markets. The Accommodation Agreement implements provisions of the DIP Facility previously negotiated by the Debtors to be used in the event that extension of the DIP Facility was not practical, available, or desirable. The Debtors believe that it is necessary and appropriate to enter into the Accommodation Agreement and pay the fees associated with the agreement to preserve their liquidity while they seek sufficient emergence capital funding so that they can emerge from chapter 11 as soon as practicable. Through the Accommodation Agreement, certain Tranche A Lenders and Tranche B Lenders would agree to, among other things, allow the Debtors to continue using the proceeds of the DIP Facility notwithstanding, among other things, the DIP Facility's maturity date of December 31, 2008. The terms of the Second Amended and Restated DIP Credit Agreement, the Debtors are not required to seek an accommodation agreement with the Tranche C Lenders. The Debtors are nevertheless seeking the Court's approval of certain incentives for the Tranche C Lenders to participate in the Accommodation Agreement. The Debtors are working to emerge from chapter 11 and believe that they have taken all appropriate steps to facilitate emergence as quickly as possible in the face of the current unprecedented turbulence in the credit markets and uncertainty in the automobile industry. The Debtors nonetheless believe that it is prudent to take steps at this time to preserve liquidity because they do not anticipate emerging from chapter 11 prior to the current Maturity Date on December 31, 2008. The Debtors do not believe that all of the DIP Lenders would agree to a further extension of the Maturity Date on terms that would be reasonably acceptable to the Debtors and their other stakeholders. "Indeed, it is unclear whether certain DIP Lenders would grant a further six-month maturity extension under any conditions," Mr. Butler avers. The Debtors have negotiated an agreement whereby JPMorgan and the requisite Tranche A Lenders and Tranche B Lenders as set forth in the Second Amended and Restated DIP Credit Agreement would agree to, among other things, accommodate the Debtors by allowing the Debtors to continue use the proceeds of the DIP Facility, to the extent already drawn by the Maturity Date, notwithstanding the passing of the Maturity Date of December 31, 2008). Mr. Butler contends that entry into the Accommodation Agreement is necessary to enable the Debtors to operate with sufficient and uninterrupted liquidity to continue to work towards emergence while the capital markets stabilize. Further, the protections and incentives that the Accommodation Agreement should provide substantial assurance to the Debtors' stakeholders and should help facilitate the Debtors' efforts to satisfy their emergence capital funding needs as contemplated under the Modified Plan. The Accommodation Agreement To extend the Maturity Date of the DIP Facility, the Debtors are required to obtain the unanimous consent of the DIP Lenders. Thus, to protect the Debtors and their stakeholders, the Debtors negotiated an accommodation agreement that will allow them to preserve liquidity under the DIP Facility without the unanimous consent of all of the DIP Lenders. The term of the Accommodation Agreement would be from January 1, 2009 through and including June 30, 2009, unless certain milestones are not satisfied. Specifically, the Accommodation Period may be shortened to May 5, 2009 if the Debtors have not met one of the following conditions. The Debtors must either (a) have received binding commitments, subject to customary conditions, on or prior to February 27, 2009, for debt and equity financing sufficient for them to emerge from chapter 11 pursuant to the Modified Plan or any other plan of reorganization that provides the DIP Lenders with the same treatment as that set forth in the Modified Plan or (b) have (i) filed, on or prior to February 27, 2009, modifications to the Modified Plan or any other plan of reorganization with respect to which the Agent does not submit a notice, within 10 business days of such filing, informing the Debtors that the Required Lenders affirmatively oppose such modifications or plan of reorganization, and (ii) on or prior to March 31, 2009, the Debtors must have obtained entry of this Court's order approving modifications to the disclosure statement with respect to the Modified Plan, as may have been further modified, or such other plan of reorganization. The Accommodation Agreement provides, as a precondition to its effectiveness, that GM waive its setoff rights and related adequate protection liens with respect to GM's prepetition claims granted by the current DIP Refinancing Order The terms of the Accommodation Agreement are: Accommodation The Participating Lenders agree to forbear from exercising certain remedies (including with respect to Hedging Agreements subject to certain conditions) that arise from any Specified Default Interest Rate On Drawn Amounts From the effective date of the Accommodation Agreement through the Maturity Date, these interest rates apply to amounts drawn under the DIP Facility: -- Tranche A Borrowings: Increased from L+400 to L+600 -- Tranche B Borrowings: Increased from L+400 to L+600 -- Tranche C Borrowings: Increased from L+525 to L+725 After the Maturity Date, default interest rates apply, increasing otherwise currently- existing applicable interest rates by 200 basis points Pledge Of Foreign Stock Pledge of 100% equity interests in first- tier Foreign Subsidiaries. Under the Second Amended and Restated DIP Credit Agreement, pledges of equity in first-tier Foreign Subsidiaries were capped at 65%. Fees The Debtors would pay Participating Lenders an accommodation fee in consideration for entering into the Accommodation Agreement. Specifically, those Participating Lenders that submit a consent to the Accommodation Agreement by November 14, 2008 would receive an Accommodation Fee equal to 200 basis points of such Participating Lender's loan. Other fee provisions would be contained in a separate fee letter, which the parties have agreed will be kept confidential. Covenants Include a Minimum Global EBITDAR for Delphi, Minimum Borrower Liquidity Availability of $100 million, and Mandatory prepayment for Borrowing Base insufficiency. About Delphi Corp. Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ) -- http://www.delphi.com/-- is the single supplier of vehicle electronics, transportation components, integrated systems and modules, and other electronic technology. The company's technology and products are present in more than 75 million vehicles on the road worldwide. Delphi has regional headquarters in Japan, Brazil and France. The company filed for Chapter 11 protection on Oct. 8, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP, represent the Official Committee of Unsecured Creditors. As of June 30, 2008, the Debtors' balance sheet showed US$9,162,000,000 in total assets and US$23,742,000,000 in total debts. The Court approved Delphi's First Amended Joint Disclosure Statement and related solicitation procedures for the solicitation of votes on the First Amended Plan on Dec. 20, 2007. The Court confirmed the Debtors' First Amended Plan on Jan. 25, 2008. The Plan has not been consummated after a group led by Appaloosa Management, L.P., backed out from their proposal to provide US$2,550,000,000 in equity financing to Delphi. (Delphi Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) DOWNSTREAM DEVELOPMENT: Moody's Junks Corporate Family Rating ------------------------------------------------------------- Moody's Investors Service lowered the Downstream Development Authority's corporate family rating, probability of default rating and senior notes rating to Caa1 from B3. The outlook is negative. The rating action is based on the expectation of weak fixed charge coverage after one year of operations, considering the challenging economic conditions. Absent strong demographics within a 50-mile radius, the Downstream Casino Resort is likely to suffer weaker visitation and spending than initially expected due to recessionary conditions. In Moody's opinion, EBITDA might not fully cover the fixed charges consisting of interest, equipment loan amortization, maintenance capex and tribal distributions in the next twelve months. Additionally, total debt/EBITDA could be near 6 times after one year of operations, a higher level than originally expected. On a more positive note, an interest reserve covers the next semi- annual April 15, 2009 interest payment related to the $197 million 12% senior notes. Still, the liquidity cushion for the payment of the Oct. 15, 2009 senior note interest might be relatively tight. Moody's assigned a B3 corporate family rating to the Authority on July 13, 2007. These ratings have been downgraded to Caa1 from B3: - Corporate Family Rating - Probability of Default Rating - Senior Note Rating (LGD assessment revised to LGD3/47% from LGD4/50%) The Downstream Development Authority is a wholly owned unincorporated instrumentality of the Quapaw Tribe of Oklahoma, a federally-recognized Native American tribe with approximately 3,400 enrolled members. The Authority operates the Downstream Casino Resort, a destination casino resort located at the spot where Kansas, Missouri and Oklahoma meet. ENOSH DEVELOPMENT: Voluntary Chapter 11 Case Summary ---------------------------------------------------- Debtor: Enosh Development, LLC 17114 York Road Parkton, MD 21120 Bankruptcy Case No.: 08-24801 Chapter 11 Petition Date: November 11, 2008 Court: District of Maryland (Baltimore) Debtor's Counsel: Michael G. Rinn, Esq. rinnoffice@rinn-law.com Law Offices of Michael G. Rinn 111 Warren Rd., Ste. 4 Cockeysville, MD 21030-2429 Tel: (410) 683-1040 Fax: (410) 683-1044 Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor doesn't have any creditor who is an insider. The petition was signed by Geraldine Forti, Managing Member of Geraldine Forti firm. ENTERCOM COMMUNICATIONS: Narrow Margins Cue S&P's Rating Cut to B+ ------------------------------------------------------------------ Standard & Poor's Rating Services lowered its long-term corporate credit rating on Bala Cynwyd, Pennsylvannia-based radio broadcaster Entercom Communications Inc. to 'B+' from 'BB-'. The rating outlook is stable. At the same time, Standard & Poor's lowered its issue-level rating on Entercom Radio LLC's $150 million 7.625% notes due 2014, to 'B-' (two notches lower than the corporate credit rating on Entercom Communications Inc.), from 'B'. The '6' recovery rating remains unchanged, indicating S&P's expectation of negligible (0%-10%) recovery in the event of a payment default. "The downgrade reflects the company's narrow margin of covenant compliance and S&P's concern that despite cost cutting initiatives and Entercom's recent termination of its dividend, currently weak advertising demand will continue to pressure earnings and cash flow over the intermediate term," said Standard & Poor's credit analyst Michael Altberg. As of Sept. 30, 2008, leverage per lenders was 5.3x versus a 6.0x net leverage covenant, which has no scheduled stepdowns. The company currently has roughly a 12% cushion against EBITDA declines. The leverage covenant allows excess cash more than $3 million and up to $25 million to be netted against gross debt. Although S&P expects the company will continue to generate healthy discretionary cash flow in 2009, which can be used for debt repayment and to replenish cash balances, S&P expects its current margin of covenant compliance could narrow further under adverse business conditions. Entercom is the fourth-largest radio broadcaster in the U.S. based on revenue. The company has grown by acquiring radio stations in large markets, which are typically more cash generative, due to their lower ratio of capital spending needs to revenue, than smaller market stations. The majority of the company's radio station clusters are ranked No. 1 or No. 2 in their markets, providing the company a greater share of market revenue opportunities and overhead efficiencies. The stable outlook reflects S&P's expectation that the company will continue to generate healthy discretionary cash flow and reduce debt balances over the near term. S&P could revise the outlook to negative if credit metrics deteriorate to the point that Entercom risks violating its net leverage covenant. More specifically, S&P expects that a roughly 10% decline in trailing- 12-month EBITDA, in the absence of additional debt reduction or meaningful rise in cash balances, could lead to a negative outlook. At this point, S&P would expects the company to articulate a plan to reduce leverage or to seek covenant relief. The company currently has adequate interest coverage metrics, and S&P believe the rating could withstand a moderate increase in interest rates that could accompany a potential amendment, barring meaningful further EBITDA deterioration. Conversely, an outlook revision to positive, which S&P views as unlikely over the intermediate term, would require the company to reduce adjusted leverage to about 5.5x and re-establish adequate headroom against covenants. EVEREST ENTERPRISES: Voluntary Chapter 11 Case Summary ------------------------------------------------------ Debtor: Everest Enterprises, Inc. P. O. Box 4438 Wichita Falls, TX 76308 Bankruptcy Case No.: 08-70472 Chapter 11 Petition Date: November 3, 2008 Court: Northern District of Texas (Wichita Falls) Judge: Harlin DeWayne Hale Debtor's Counsel: Monte J. White, Esq. Monte J. White & Associates, P.C. 1106 Brook Avenue Wichita Falls, TX 76301 Tel: (940) 723-0099 Fax: (940) 723-0096 E-mail: legal@montejwhite.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,000 to $10,000,000 The Debtor did not file a list of its largest unsecured creditors together with its petition. FEDERAL-MOGUL: Releases Status Report of Chapter 11 Cases --------------------------------------------------------- At the directive of Judge Judith Fitzgerald of the U.S. Bankruptcy Court for the District of Delaware, Federal-Mogul Corp. and its debtor-affiliates delivered to the Court on Nov. 6, 2008, a status report of their Chapter 11 cases. As a result of the Debtors' Fourth Amended Joint Plan of Reorganization, which became effective on Dec. 27, 2007, and the U.S. Bankruptcy for the District of Delaware's ruling on the Plan A Settlement, most matters in the Debtors' Chapter 11 cases have been resolved, says James E. O'Neill, Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware. The only matters presently open before the Bankruptcy Court and the U.S. District Court for the District of Delaware, according to Mr. O'Neill, are: (1) two adversary proceedings; (2) four outstanding claims objections, as well as various unresolved unsecured claims and administrative expense claims that are not presently the subject of an objection; (3) an appeal pending before the District Court concerning certain insurance assignment and preemption issues, which appeal is scheduled for a hearing on November 12, 2008, before the District Court; and (4) certain causes of action belonging to the Debtors' bankruptcy estates that are not yet the subject of pending actions. The two adversary proceedings that remain open: * Federal-Mogul Corporation, et al., v. Bobby Whitley, et al., Case No. 05-30785, commenced December 28, 2005; and * Federal-Mogul Asbestos Personal Injury Trust v. Larry Joe Floyd, et al., Case No. 08-50569, commenced April 14, 2008. In the Bobby Whitley action, Federal-Mogul seeks declaratory and injunctive relief under Sections 362 and 105 of the Bankruptcy Code enjoining certain individual asbestos personal injury claimants from pursuing certain PI Claims against Cooper Industries, Ltd., Cooper Industries, LLC, PCT International Holdings, Inc., and Pneumo Abex Corporation, together with certain of their affiliates. The adversary proceeding is the subject of a motion to dismiss filed on Oct. 10, 2008, which has been noticed for the Nov. 24, 2007, omnibus hearing, and has an objection deadline of Nov. 7, 2008. As of Nov. 11, no objection has been filed. In the Larry Joe Floyd action, the PI Trust sought declaratory and injunctive relief under Sections 362 and 105 enjoining certain individual PI Claimants from Cooper Ltd., Cooper LLC, PCT, Pneumo Abex and their affiliates. The Bankruptcy Court denied the preliminary injunction sought by the PI Trust. The Debtors, Mr. O'Neil relates, have contacted counsel for the PI Trust to advise them that the action remains pending and should be closed or otherwise resolved. The Debtors have four objections to claims on file with the Bankruptcy Court that have not been resolved: * The Debtors' objection to the amended proofs of claim filed by PepsiAmericas, Inc., is awaiting adjudication by the Bankruptcy Court. The Debtors submitted a motion for summary judgment with respect to PepsiAmericas' claims on March 28, 2007. Following extensive briefing, the Court head oral argument on the Debtors' motion on June 7, 2007. On July 24, 2008, at the Bankruptcy Court's request, counsel for the Debtors filed with the Bankruptcy Court a notice of completion of briefing with respect to the matter. * The Debtors have three ongoing objections to unsecured claims asserted by American International Group, Inc. Attempts to resolve those objections are ongoing, and the Debtors have continued those objections while those efforts are pursued. Moreover, the Debtors are continuing to evaluate and resolve the remaining 130 outstanding prepetition and administrative claims against their estates. The Debtors are presently required to submit objections to all unresolved prepetition and administrative expense claims on or before Dec. 27, 2008. Given the ongoing efforts to resolve many of the claims consensually, Mr. O'Neill says the Debtors anticipate requesting from the Bankruptcy Court an extension of the Dec. 27, 2008, Claims Objection Deadlines. Presently, the Debtors have filed a stipulation with Richard Snell, FMC's former president and chief executive officer, which resolves $7,700,000 in claims asserted against the Debtors. The Debtors anticipate filing with the Bankruptcy Court additional stipulations or other pleadings resolving other claims against their estates in the near term, Mr. O'Neil says. On March 20, 2008, the Bankruptcy Court issued a Memorandum Opinion and Order concerning certain insurance-related assignment and preemption issues. That order was appealed by certain insurance companies to the District Court. The Debtors believe that briefing on that appeal in the District Court has been completed, and the District Court has scheduled oral argument on the appeal for November 12, 2008. The Debtors believe this is the only matter outstanding on appeal in their chapter 11 cases. Mr. O'Neill relates that the Debtors are continuing to evaluate and resolve consensually certain causes of action belonging to their estates. FMC has entered into a settlement agreement with L. Tersigni Consulting CPA, P.C., relating to Tersigni's services as financial advisor to the Official Committee of Asbestos Claimants. The Debtors intend to file a request seeking the Bankruptcy Court's approval of the settlement no later than November 10, 2008, so that the settlement may be noticed for the December 15, 2008, omnibus hearing. With the exception of the Tersigni settlement, the Debtors do not anticipate presenting to the Court any settlements of causes of action belonging to their estates in the near future, Mr. O'Neill says. A full-text copy of the Nov. 2008 Status Report is available for free at http://ResearchArchives.com/t/s?34eb About Federal-Mogul Corporation Federal-Mogul Corporation -- http://www.federal-mogul.com/-- (OTCBB: FDMLQ) is a global supplier, serving the world's foremost original equipment manufacturers of automotive, light commercial, heavy-duty, agricultural, marine, rail, off-road and industrial vehicles, as well as the worldwide aftermarket. Founded in Detroit in 1899, the company is headquartered in Southfield, Michigan, and employs 45,000 people in 35 countries. Aside from the U.S., Federal-Mogul also has operations in other locations which includes, among others, Mexico, Malaysia, Australia, China, India, Japan, Korea, and Thailand. The Company filed for chapter 11 protection on Oct. 1, 2001 (Bankr. Del. Case No. 01-10582). Lawrence J. Nyhan Esq., James F. Conlan Esq., and Kevin T. Lantry Esq., at Sidley Austin Brown & Wood, and Laura Davis Jones Esq., at Pachulski, Stang, Ziehl & Jones, P.C., represent the Debtors in their restructuring efforts. When the Debtors filed for protection from their creditors, they listed $10.15 billion in assets and $8.86 billion in liabilities. Federal-Mogul Corp.'s U.K. affiliate, Turner & Newall, is based at Dudley Hill, Bradford. Peter D. Wolfson, Esq., at Sonnenschein Nath & Rosenthal; and Charlene D. Davis, Esq., Ashley B. Stitzer, Esq., and Eric M. Sutty, Esq., at The Bayard Firm represent the Official Committee of Unsecured Creditors. On March 7, 2003, the Debtors filed their Joint Chapter 11 Plan. They submitted a Disclosure Statement explaining that plan on April 21, 2003. They submitted several amendments and on June 6, 2004, the Bankruptcy Court approved the Third Amended Disclosure Statement for their Third Amended Plan. On July 28, 2004, the District Court approved the Disclosure Statement. The estimation hearing began on June 14, 2005. The Debtors submitted a Fourth Amended Plan and Disclosure Statement on Nov. 21, 2006, and the Bankruptcy Court approved that Disclosure Statement on Feb. 6, 2007. The Fourth Amended Plan was confirmed by the Bankruptcy Court on Nov. 8, 2007, and affirmed by the District Court on November 14. Federal-Mogul emerged from chapter 11 on Dec. 27, 2007. (Federal-Mogul Bankruptcy News, Issue No. 175; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) FIRST NATIONAL: Moody's Rates Class D Notes at 'Ba2' ---------------------------------------------------- Moody's Investors Service assigned ratings to three classes of First National Master Note Trust, VFN Series 2008-3 asset-backed notes. The notes are backed by a certificate interest issued by First Bankcard Master Credit Card Trust to the issuer, which in turn is backed by a pool of receivables generated by First National Bank of Omaha Visa and MasterCard credit card accounts. The complete rating action is: Issuer: First National Master Note Trust -- Up to $44,000,000 Class B Asset Backed Notes, VFN Series 2008-3, rated A2 -- Up to $42,625,000 Class C Asset Backed Notes, VFN Series 2008-3, rated Baa2 -- Up to $11,000,000 Class D Asset Backed Notes, VFN Series 2008-3, rated Ba2 The ratings are based on the quality of the trust assets, the transaction's legal and structural protections, including early amortization triggers and credit enhancement in the form of subordination and, in the case of the Class C and Class D notes, an excess spread account, and the expertise of FNBO as originator of the accounts and servicer of the receivables. FNBO is one of the first institutions to enter the credit card market, having issued its first credit cards in 1953. FNBO has a long-term bank deposit rating of A3, a short-term deposit rating of P-2, and a bank financial strength rating of C. FIRST UNION: S&P Downgrades Ratings on Four Classes of Certs. ------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on four classes of commercial mortgage pass-through certificates from First Union National Bank Commercial Mortgage Trust's series 2002- C1. At the same time, S&P affirmed S&P's ratings on 12 other classes from this series. The lowered ratings reflect the anticipated losses and credit support erosion upon the eventual resolution of one asset and one loan with the special servicer, CWCapital Asset Management. S&P downgraded the class N certificate to 'D' due to recurring interest shortfalls. The downgrades also reflect credit concerns regarding three of the six loans in the pool that have reported debt service coverage of less than 1.0x. The affirmed ratings reflect credit enhancement levels that provide adequate support through various stress scenarios. The asset and loan ($5.6 million, 0.9%) with the special servicer are: -- The Amaretto at North Tampa asset has a total exposure of $3.7 million (0.6%) and is secured by a 96-unit multifamily property in Tampa. The asset was transferred to CWCapital on Oct. 18, 2007, and is classified as real estate owned. There is significant deferred maintenance associated with the property, which is currently being addressed. Occupancy was 78% as of October 2008. A $1.8 million appraisal reduction amount is in effect for this asset. Standard & Poor's expects that the resolution of the asset will result in a significant loss. -- The Western Heights loan has a total exposure of $1.9 million (0.3%) and is secured by a 100-unit multifamily property in Detroit. The loan was transferred to CWCapital on March 5, 2008, due to payment default. The loan is 90-plus-days delinquent, and CWCapital expects it to become REO by the end of the year. In addition, there is deferred maintenance associated with the property. Occupancy was approximately 60% as of October 2008, and it will decline further as the receiver continues evicting tenants that are not currently paying rent. An $857,562 ARA in effect for this loan. Standard & Poor's expects that the resolution of the loan will result in a significant loss. Excluding the Amaretto at North Tampa asset and the Western Heights loan, which are with the special servicer, there are six loans in the pool ($36.4 million, 5.9%) that have reported DSCs of less than 1.0x. The loans are secured by multifamily, industrial, and retail properties and have an average balance of $6.1 million. These loans have seen an average decline in DSC of 61% since issuance. Three of the six loans are credit concerns. Two of the properties (1.3%) securing loans that are credit concerns experienced declining occupancies. One loan, Rittenhouse 222 Apartments (2.2%), is the largest loan on the watchlist. The remaining three loans are not currently credit concerns because occupancies at these properties have rebounded from declines that resulted from the loss of major tenants. As of the Nov. 12, 2008, remittance report, the collateral pool consisted of 94 loans with an aggregate trust balance of $613.3 million, compared with 106 loans totaling $728.3 million at issuance. The master servicer, Wachovia Bank N.A., reported financial information for 98% of the pool, excluding defeased loans ($247.5 million, 40%). Ninety-three percent of the servicer-provided information was full-year 2007 data. Standard & Poor's calculated a weighted average DSC of 1.46x for the pool, up from 1.35x at issuance. As discussed above, there is one REO asset and one delinquent loan with the special servicer. The trust has experienced seven losses totaling $13.6 million to date. The top 10 loans secured by real estate have an aggregate outstanding balance of $168.8 million (27.5%) and a weighted average DSC of 1.55x, up from 1.35x at issuance. Standard & Poor's reviewed the property inspections provided by the master servicer for the properties underlying the top 10 exposures. All of the assets were characterized as either "good" or "excellent." Wachovia reported a watchlist of 10 loans ($55.2 million, 9.0%). The Rittenhouse 222 Apartments loan ($13.3 million, 2% of pool) is the largest loan on the watchlist and the sixth-largest exposure in the pool. The loan is secured by a 95-unit multifamily property in the Center City submarket of Philadelphia. The property, built in 1925, is in the beginning stages of being repositioned from corporate rentals to a luxury residential building. The loan appears on the watchlist because of a decline in occupancy due to the change in use and renovations. As of the October 2008 rent roll, the property was 71% occupied. The DSC as of year-end 2007 was 1.14x but has dropped below 1.0x due to the repositioning. Standard & Poor's identified two collateral properties ($9.5 million, 1.5%) in areas affected by Hurricane Ike. These loans do not appear on the watchlist. One property, U-Haul Center Alief ($1.3 million allocated balance, 0.2% of the pool balance), experienced minor damage that has already been repaired. In addition the property that secures the Belaire Atrium I & II loan ($8.2 million, 1.3%) sustained major damage, totaling approximately $1 million. Property and business interruption insurance is available for both loans. 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. Ratings Lowered First Union National Bank Commercial Mortgage Trust Commercial mortgage pass-through certificates series 2002-C1 Rating ------ Class To From Credit enhancement ----- -- ---- ------------------ K BB BB+ 3.07% L B B+ 2.20% M CCC- CCC+ 1.03% N D CCC- 0.44% Ratings Affirmed First Union National Bank Commercial Mortgage Trust Commercial mortgage pass-through certificates series 2002-C1 Class Rating Credit enhancement ----- ------ ------------------ A-1 AAA 24.56% A-2 AAA 24.56% B AAA 20.32% C AAA 15.06% D AA+ 13.60% E AA 12.28% F AA- 10.23% G A- 8.63% H BBB+ 6.29% J BBB- 3.95% IO-I AAA N/A IO-II AAA N/A N/A - Not applicable. FLAGSTAR BANK: Moody's Downgrades Deposit Ratings to 'Ba1' ---------------------------------------------------------- Moody's Investors Service downgraded the long- and short-tem deposit ratings of Flagstar Bank, FSB to Ba1/Not-Prime from Baa3/Prime-3, and placed the long-term deposit and bank financial strength (D+) ratings under review for possible downgrade. The holding company, Flagstar Bancorp, Inc., is unrated. The downgrade reflects the ongoing deterioration in Flagstar's residential mortgage and commercial real estate portfolios and the resultant increase in Moody's expectations of credit costs related to these portfolios. In Moody's view, these credit costs, which have the potential to negatively impact Flagstar's earnings for some time, could significantly weaken the thrift's regulatory capital position. Additionally, Moody's noted that Flagstar's reliance on high cost CDs and Federal Home Loan Bank advances leaves it vulnerable to rising funding costs that could further hamper earnings and capital formation. During its review Moody's will focus on Flagstar's options for strengthening its capital base. Flagstar has indicated that it is considering participation in the U.S. Treasury's Capital Purchase Program. If Flagstar is approved to participate in the program, Moody's expects the ratings to remain at their current levels following action. If Flagstar is unsuccessful in obtaining a capital injection from the U.S. Treasury, Moody's will consider the thrift's other options for raising capital, which Moody's believes are limited due to Flagstar's recent performance and the ongoing deterioration in the credit markets. Downgrades: Issuer: Flagstar Bank, FSB -- Issuer Rating, Downgraded to Ba1 from Baa3 -- OSO Rating, Downgraded to NP from P-3 -- Deposit Rating, Downgraded to NP from P-3 -- OSO Senior Unsecured OSO Rating, Downgraded to Ba1 from Baa3 -- Senior Unsecured Deposit Rating, Downgraded to Ba1 from Baa3 On Review for Possible Downgrade: Issuer: Flagstar Bank, FSB -- Bank Financial Strength Rating, Placed on Review for Possible Downgrade, currently D+ -- Issuer Rating, Placed on Review for Possible Downgrade, currently Ba1 -- OSO Senior Unsecured OSO Rating, Placed on Review for Possible Downgrade, currently Ba1 -- Senior Unsecured Deposit Rating, Placed on Review for Possible Downgrade, currently Ba1 Outlook Actions: Issuer: Flagstar Bank, FSB -- Outlook, Changed To Rating Under Review From Negative Flagstar Bancorp, Inc., headquartered in Troy, Michigan, reported total assets of $14.2 billion at Sept. 30, 2008. FORD CREDIT: Fitch Affirms 'BB' Rating on Class D Notes ------------------------------------------------------- Fitch Ratings upgrades three classes and affirms 14 classes of two Ford Credit Auto Owner Trusts as part of its on going surveillance process. The rating actions are: 2006-C -- Class A-2a notes affirmed at 'AAA'; -- Class A-2b notes affirmed at 'AAA'; -- Class A-3 notes affirmed at 'AAA'; -- Class A-4a notes affirmed at 'AAA'; -- Class A-4b notes affirmed at 'AAA'; -- Class B notes upgraded to 'AA' from 'A'; -- Class C notes upgraded to 'A' from 'BBB+'; -- Class D notes upgraded to 'BBB' from 'BB+'. 2007-B -- Class A-2a notes affirmed at 'AAA'; -- Class A-2b notes affirmed at 'AAA'; -- Class A-3a notes affirmed at 'AAA'; -- Class A-3b notes affirmed at 'AAA'; -- Class A-4a notes affirmed at 'AAA'; -- Class A-4b notes affirmed at 'AAA'; -- Class B notes affirmed at 'A'; -- Class C notes affirmed at 'BBB'; -- Class D notes affirmed at 'BB'. The upgrades are a result of continued available credit enhancement in excess of stressed remaining losses. The collateral continues to perform within Fitch's base case expectations. Currently, under the credit enhancement structure, the securities can withstand stress scenarios consistent with the upgraded rating categories and still make full payments of interest and principal in accordance with the terms of the documents. As before, the ratings reflect the quality of Ford Motor Credit Co.'s retail auto loan originations, the sound financial and legal structure of the transactions, and servicing provided by FMCC. FORD MOTOR: PBGC Wants More Information on Retirement Plans ----------------------------------------------------------- Cary O'Reilly at Bloomberg News reports that the Pension Benefit Guaranty Corp. spokesperson Gary Pastorius said that the agency wants detailed data on the retirement plans of Ford Motor Co., Chrysler LLC, and General Motors Corp., in case it becomes responsible for the plans. According to Bloomberg News, Mr. Pastorius said in a telephone interview on Monday, "This is pretty much routine" for financially troubled companies with thousands of workers. "We want to be sure we have the latest information," Mr. Pastorius added. Bloomberg relates that GM said on Nov. 7 that it may run short of operating cash by year-end unless the auto market improves or it adds capital and the company, along with Ford and Chrysler, and the Congress is debating a request by the company, Ford Motor, and Chrysler for $25 billion in bridge loans. The PBGC, Bloomberg reports, said in February that it had an accumulated deficit of $14 billion due to an increase in corporate bankruptcies, and declining premium payments as more companies shift from traditional defined-benefit programs to uninsured plans. About Ford Motor Co. Headquartered in Dearborn, Michigan, Ford Motor Co. (NYSE: F) -- http://www.ford.com/-- manufactures or distributes automobiles in 200 markets across six continents. With about 260,000 employees and about 100 plants worldwide, the company's core and affiliated automotive brands include Ford, Jaguar, Land Rover, Lincoln, Mercury, Volvo, Aston Martin, and Mazda. The company provides financial services through Ford Motor Credit Company. The company has operations in Japan in the Asia Pacific region. In Europe, the company maintains a presence in Sweden, and the United Kingdom. The company also distributes its brands in various Latin-American regions, including Argentina and Brazil. * * * As reported in the Troubled Company Reporter on Nov. 11, 2008, Moody's Investors Service lowered the debt ratings of Ford Motor Company, Corporate Family and Probability of Default Ratings to Caa1 from B3. The company's Speculative Grade Liquidity rating remains at SGL-3 and the rating outlook is negative. In a related action Moody's also lowered the long-term rating of Ford Motor Credit Company to B3 from B2. The outlook for Ford Credit is negative. As reported in the Troubled Company Reporter on Oct. 10, 2008, Fitch Ratings downgraded the Issuer Default Rating of Ford Motor Company and Ford Motor Credit Company by one notch to 'CCC' from 'B-'. FREDDIE MAC: Moody's Says Ratings Unaffected by $25.3-BB Net Loss ------------------------------------------------------------------ Moody's Investors Service affirmed all ratings of the Federal Home Loan Mortgage Corporation, including its Aaa senior long-term debt, Prime-1 short-term debt, Aa2 subordinated debt, Ca preferred stock and E+ Bank Financial Strength Ratings. All ratings have a stable outlook. Moody's rating affirmation follows Freddie Mac's announcement of a $25.3 billion net loss for the third quarter of 2008. The company's net loss was driven by a $14.1 billion valuation allowance established for its deferred tax asset, $12.7 billion of mark-to-market losses primarily on mortgage securities, as well as $6.0 billion of credit-related expenses. Freddie Mac's net worth was a negative $13.7 billion as of the quarter ended Sept. 30, 2008 and the company announced that the Federal Housing Finance Agency has requested $13.8 billion in funding from the U.S. Treasury under the previously approved $100 billion Senior Preferred Stock Purchase Agreement. Freddie Mac's draw represents a substantial amount of the SPSPA and Moody's will continue to evaluate the sufficiency of the $100 billion SPSPA commitment to cover the company's capital needs. Moody's Aaa senior long-term, Prime-1 short-term and Aa2 subordinated ratings of Freddie Mac's debt reflect Moody's view of the very high degree of systemic support enjoyed by the company. This assumed level of systemic support is based upon the company's central role in mortgage finance in the United States, as well as the importance of housing within the U.S. economy. Moody's notes that Freddie Mac's rated subordinated debt securities contain triggers that would require interest deferral under certain circumstances. First, Freddie Mac would have to defer interest on its subordinated debt should the company be classified as critically undercapitalized. Second, Freddie Mac would have to defer interest on its subordinated debt payment if (i) it is classified as significantly undercapitalized, (ii) it requests that the U.S. Treasury purchase debt securities of the company and (iii) the U.S. Treasury agrees to purchase the company's debt securities. However, in October 2008, the FHFA, Freddie Mac's regulator, suspended the company's capital classifications during conservatorship. This action effectively eliminated the triggering event for subordinated debt interest deferral. Moody's affirmation of the Aa2 subordinated debt rating with a stable outlook reflects the rating agency's view that under the circumstances deferral is highly unlikely. Freddie Mac's Ca preferred stock rating reflects the conservator's decision to suspend the non-cumulative preferred stock dividends, as well as Moody's expectation that those dividends will likely be suspended for several years. The E+ BFSR reflects the extraordinary support provided by the U.S. Treasury through the Senior Preferred Stock Purchase Program and GSE Credit Facility. Without this extraordinary support, Freddie Mac's liquidity and capital resources would be severely constrained. GENERAL GROWTH: Strained Liquidity Cues Moody's to Junk Ratings --------------------------------------------------------------- Moody's Investors Service has downgraded the ratings on General Growth Properties, Inc., certain of its subsidiaries and The Rouse Company LP (to Caa2 from B3 senior secured bank debt; to Caa2 from B3 senior unsecured debt). The ratings remain on review for further possible downgrade. The rating action reflects deepening concerns in the REIT's ability to meet its near term debt obligations and funding needs. General Growth's severely strained liquidity position coupled with earnings pressure due to distressed and weakening retail economic conditions, along with a difficult capital market environment are also contributing factors to the rating. Fast approaching maturities for the REIT include $900 million of property secured debt that matures on November 28 and $600 million in unsecured Rouse bonds due within six months. The earnings pressures have eroded General Growth's credit metrics and the cushion for both the secured debt and interest coverage covenants for the Rouse debt. The REIT has been exploring several alternatives to meet their urgent capital needs, including, but not limited to, working on extending the maturity date of their mortgage loans due at the end of this month and also marketing for sale their premier Las Vegas malls. The outcome is still uncertain. Moody's review will continue to focus on the REIT's ability to manage through its substantial funding needs in the near term, as well as its ultimate capital structure, asset composition, and earnings strength and stability. The Caa2 rating reflects the company's liquidity position and current credit metrics. A further downgrade would likely reflect any refinancing missteps, any weakening of current credit metrics and an acute reversal in earnings strength or stability, or a breach in bond covenants. A return to a stable outlook would be contingent upon the REIT's ability to successfully refinance or extend on a long term basis (for at least 2 years) its near term debt maturities, maintain good operating performance at its retail centers, preserve current credit metrics on a consolidated basis, and compliance with bond covenants. These ratings were downgraded and continue to be under review down for possible downgrade: -- GGP Limited Partnership - Senior secured bank debt to Caa2 from B3, and senior unsecured debt shelf to (P)Caa2 from (P)B3. -- General Growth Properties, Inc. - Senior secured bank debt to Caa2 from B3, and preferred stock shelf to (P)Ca from (P)Caa2. The Rouse Company LP - Senior unsecured debt to Caa2 from B3. General Growth Properties, Inc. is headquartered in Chicago, Illinois, and is one of the largest owners and operators of regional malls in the United States. The REIT reported assets of $29.7 billion, and equity of $1.8 billion, at Sept. 30, 2008. GENERAL MOTORS: Approval of Bailout for Automakers Uncertain ------------------------------------------------------------ Josh Mitchell at WSJ reports that approval of the U.S. Senate Democrats' bill for a financial aid to auto makers remained uncertain. As reported by the Troubled Company Reporter, the bill will be introduced by Senate Majority Leader Harry Reid and would provide about $25 billion in low-cost loans to GM, Ford Motor Co., and Chrysler LLC. The report says that the bill calls for the money to come from the government's $700 billion rescue fund for financial institutions. WSJ relates that the Bush administration and some Republicans have opposed using money from the $700 billion bailout fund on auto makers, because it was meant for banking institutions. According to WSJ, the administration and congressional Republicans insist that the financial aid for automakers be taken from $25 billion loan program approved by Congress in September to help the industry develop more fuel-efficient vehicles. Josh Mitchell at Dow Jones states that Senate Minority Whip Jon Kyl, criticized the bailout plan for automakers, while Democratic leaders on Capitol Hill called a session to consider a second economic-stimulus package and whether to rush $25 billion in emergency loans to the automakers. Deborah Solomon at WSJ relates that Treasury Secretary Henry Paulson is unlikely to use the remaining $410 billion of the $700 billion rescue fund to launch any substantial new programs. According to the report, he prefers to keep some money in reserve and preserve flexibility for the incoming Obama administration. Mr. Paulson said that he doesn't plan to tap it unless a need arises, says the report. According to Bloomberg News, senators from southern states with factories owned by Asian and European car manufacturers oppose a bailout of U.S. automakers, saying the industry can thrive without the Big 3. "We have a number of profitable automakers in America, and they shouldn't be disadvantaged for making wise business decisions while failure is rewarded," Republican Senator James DeMint of South Carolina said. Munich-based Bayerische Motoren Werke AG employs about 4,500 people at a Spartanburg, South Carolina, assembly plant. "If the Big Three can't make it with their current structure, they can protect jobs by reorganizing under bankruptcy protection," Mr. DeMint said. About General Motors Headquartered in Detroit, Michigan, General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- was founded in 1908. GM employs about 266,000 people around the world and manufactures cars and trucks in 35 countries. In 2007, nearly 9.37 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. General Motors Latin America, Africa and Middle East, with headquarters in Miramar, Florida, is one of GM's four regional business units. GM LAAM employs approximately 37,000 people in 18 countries and has manufacturing facilities in Argentina, Brazil, Colombia, Ecuador, Egypt, Kenya, South Africa and Venezuela. GM LAAM markets vehicles under the Buick, Cadillac, Chevrolet, GMC, Hummer, Isuzu, Opel, Saab and Suzuki brands. As reported in the Troubled Company Reporter on Nov. 10, 2008, General Motors Corporation's balance sheet at Sept. 30, 2008, showed total assets of $110.425 billion, total liabilities of $170.3 billion, resulting in a stockholders' deficit of $59.9 billion. * * * As reported in the Troubled Company Reporter on Nov. 11, 2008, Standard & Poor's Ratings Services lowered its ratings, including the corporate credit rating, on General Motors Corp. to 'CCC+' from 'B-' and removed them from CreditWatch, where they had been placed with negative implications on Oct. 9, 2008. S&P said that the outlook is negative. Fitch Ratings, as reported in the Troubled Company Reporter on Nov. 11, 2008, placed the Issuer Default Rating of General Motors on Rating Watch Negative as a result of the company's rapidly diminishing liquidity position. Given the current liquidity level of $16.2 billion and the pace of negative cash flows, Fitch expects that GM will require direct federal assistance over the next quarter and the forbearance of trade creditors in order to avoid default. With virtually no further access to external capital and little potential for material asset sales, cash holdings are expected to shortly reach minimum required operating levels. Fitch placed these on Rating Watch Negative: -- Senior secured at 'B/RR1'; -- Senior unsecured at 'CCC-/RR5'. As reported in the Troubled Company Reporter on June 24, 2008, DBRS has placed the ratings of General Motors Corp. and General Motors of Canada Limited Under Review with Negative Implications. The rating action reflects the structural deterioration of the company's operations in North America brought on by high oil prices and a slowing U.S. economy. GENERAL MOTORS: Sells 3% Stake in Suzuki to Raise Cash ------------------------------------------------------ Kenneth Maxwell at The Wall Street Journal reports that General Motors said on Monday that it sold its remaining 3% stake in Japan's Suzuki Motor Corp. on the Tokyo stock market for about $230 million, or $14.03 per share, to raise cash for its operations. The report says that the amount matched Monday's closing price on the Tokyo Stock Exchange, but is almost 5% below the stock's 25-day moving average, and less than half its high for the year. According to WSJ, GM said the move was "based on a mutual agreement." Suzuki Motor said that it was mindful of GM's need to secure funds, WSJ relates. "This action will have no impact on our existing bilateral business relationships," GM's CEO Rick Wagoner said in a statement. GM and Suzuki Motor said that GM could return as a Suzuki investor at some point in the future, WSJ states. WSJ says that GM had owned more than 20% of Suzuki, in which it took an initial stake in 1981. GM, says the report, sold a 17% stake in 2006 to raise cash for restructuring, leaving it with just 3%. Suzuki to Buy Back Shares in Open Market In connection with GM's plans to sell 16,413,000 Suzuki shares, on the open market on November 18, Suzuki said today it will utilize the TSE-sanctioned TosTNET-2 (pre-announcement based, treasury stock purchasing system) to purchase the equivalent number of shares to be sold by GM as its treasury stock through the open market. Suzuki said they have mutual agreement with GM to continue the implementation and expansion of the business relationship between the two carmakers. Suzuki, in its statement said it has a constructive business relationship with GM that dates back to August 1981. The companies have agreed to be committed to continue promoting and implementing not only our existing projects, including development collaboration on advanced automotive technologies, but also collaboration on entries in new existing markets. Rick Wagoner, Chairman and CEO, General Motors Corporation, and Osamu Suzuki, Chairman and CEO, Suzuki Motor Corporation have engaged in a dialogue regarding GM's sale of its Suzuki stake. The sale has been supported and already approved by both GM and Suzuki boards by today. They also confirmed to give positive consideration on a possibility for GM to repurchase Suzuki shares in the future. The purchasing price will be the closing price today of JPY1,363/share. The total amount is estimated to be JPY22,370,919,000. The funds required to purchase the stock will come out of Suzuki's own internal reserve. "Suzuki and GM have been constantly exchanging frank opinions on various topics as business partners," said Suzuki. "As GM taking this particular step to sell the shares it owns as a step toward strengthening its balance sheet is very understandable, we wanted to support GM's decision. We confirmed each other in a conference call with Wagoner-san and me that all individual initiatives will be pursued as they are today. There will be no impact on Suzuki's current business plan." About Suzuki The Brea, Calif.-based Operations of American Suzuki Motor Corporation (ASMC) was founded in 1963 by parent company Suzuki Motor Corporation (SMC) and currently markets its vehicles in the United States through a network of approximately 400 automotive dealerships and numerous other motorcycle, ATV and marine distributors in 49 states. With global headquarters in Hamamatsu, Japan, SMC is a diversified worldwide automobile, motorcycle, and outboard motor manufacturer. In 2007, SMC sold more than two million new cars and trucks and more than three million motorcycles and ATVs. Founded in 1909 and incorporated in 1920, SMC has operations in 193 countries and regions. For more information, visit www.media.suzuki.com. About General Motors Headquartered in Detroit, Michigan, General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- was founded in 1908. GM employs about 266,000 people around the world and manufactures cars and trucks in 35 countries. In 2007, nearly 9.37 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. General Motors Latin America, Africa and Middle East, with headquarters in Miramar, Florida, is one of GM's four regional business units. GM LAAM employs approximately 37,000 people in 18 countries and has manufacturing facilities in Argentina, Brazil, Colombia, Ecuador, Egypt, Kenya, South Africa and Venezuela. GM LAAM markets vehicles under the Buick, Cadillac, Chevrolet, GMC, Hummer, Isuzu, Opel, Saab and Suzuki brands. As reported in the Troubled Company Reporter on Nov. 10, 2008, General Motors Corporation's balance sheet at Sept. 30, 2008, showed total assets of $110.425 billion, total liabilities of $170.3 billion, resulting in a stockholders' deficit of $59.9 billion. * * * As reported in the Troubled Company Reporter on Nov. 11, 2008, Standard & Poor's Ratings Services lowered its ratings, including the corporate credit rating, on General Motors Corp. to 'CCC+' from 'B-' and removed them from CreditWatch, where they had been placed with negative implications on Oct. 9, 2008. S&P said that the outlook is negative. Fitch Ratings, as reported in the Troubled Company Reporter on Nov. 11, 2008, placed the Issuer Default Rating of General Motors on Rating Watch Negative as a result of the company's rapidly diminishing liquidity position. Given the current liquidity level of $16.2 billion and the pace of negative cash flows, Fitch expects that GM will require direct federal assistance over the next quarter and the forbearance of trade creditors in order to avoid default. With virtually no further access to external capital and little potential for material asset sales, cash holdings are expected to shortly reach minimum required operating levels. Fitch placed these on Rating Watch Negative: -- Senior secured at 'B/RR1'; -- Senior unsecured at 'CCC-/RR5'. As reported in the Troubled Company Reporter on June 24, 2008, DBRS has placed the ratings of General Motors Corp. and General Motors of Canada Limited Under Review with Negative Implications. The rating action reflects the structural deterioration of the company's operations in North America brought on by high oil prices and a slowing U.S. economy. GENERAL MOTORS: Snobs PBGC's Request for Info on Pensions --------------------------------------------------------- Darrell A. Hughes at Dow Jones Newswires reports that the U.S. Pension Benefit Guaranty Corp. said on Monday that GM hasn't responded to its request for updated financial information on the automaker's two pension programs. PBGC spokesperson Marc Hopkins, according to Dow Jones, said that the PBGC is looking for a "more accurate" picture of GM's pension programs stability, so that it can effectively monitor the financial health of auto makers. "We are currently aware of the status of the other auto makers," Dow Jones quoted Mr. Hopkins as saying. Dow Jones relates that GM spokesperson Renee Rashid-Merem said last week that: -- the company's pension program for hourly workers is underfunded by $500 million, -- the company's plan for salaried workers is overfunded, and -- the company doesn't expect its two pension programs to become government liabilities in the short term. Liabilities from the programs could cause a significant increase in PBGC's $14 billion deficit once GM collapses and becomes unable to fund its pensions, Dow Jones states. About General Motors Headquartered in Detroit, Michigan, General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- was founded in 1908. GM employs about 266,000 people around the world and manufactures cars and trucks in 35 countries. In 2007, nearly 9.37 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. General Motors Latin America, Africa and Middle East, with headquarters in Miramar, Florida, is one of GM's four regional business units. GM LAAM employs approximately 37,000 people in 18 countries and has manufacturing facilities in Argentina, Brazil, Colombia, Ecuador, Egypt, Kenya, South Africa and Venezuela. GM LAAM markets vehicles under the Buick, Cadillac, Chevrolet, GMC, Hummer, Isuzu, Opel, Saab and Suzuki brands. As reported in the Troubled Company Reporter on Nov. 10, 2008, General Motors Corporation's balance sheet at Sept. 30, 2008, showed total assets of $110.425 billion, total liabilities of $170.3 billion, resulting in a stockholders' deficit of $59.9 billion. * * * As reported in the Troubled Company Reporter on Nov. 11, 2008, Standard & Poor's Ratings Services lowered its ratings, including the corporate credit rating, on General Motors Corp. to 'CCC+' from 'B-' and removed them from CreditWatch, where they had been placed with negative implications on Oct. 9, 2008. S&P said that the outlook is negative. Fitch Ratings, as reported in the Troubled Company Reporter on Nov. 11, 2008, placed the Issuer Default Rating of General Motors on Rating Watch Negative as a result of the company's rapidly diminishing liquidity position. Given the current liquidity level of $16.2 billion and the pace of negative cash flows, Fitch expects that GM will require direct federal assistance over the next quarter and the forbearance of trade creditors in order to avoid default. With virtually no further access to external capital and little potential for material asset sales, cash holdings are expected to shortly reach minimum required operating levels. Fitch placed these on Rating Watch Negative: -- Senior secured at 'B/RR1'; -- Senior unsecured at 'CCC-/RR5'. As reported in the Troubled Company Reporter on June 24, 2008, DBRS has placed the ratings of General Motors Corp. and General Motors of Canada Limited Under Review with Negative Implications. The rating action reflects the structural deterioration of the company's operations in North America brought on by high oil prices and a slowing U.S. economy. GENERAL MOTORS: Will Postpone Reimbursement to Dealers ------------------------------------------------------ The Associated Press reports that General Motors Corp. said on Monday that it will delay reimbursing its dealers for rebates and other sales incentives by two weeks. Payments due Nov. 28 will be made on Dec. 11, while those due Dec. 4 will be paid Dec. 18, The AP relates, citing GM spokesperson John McDonald. The report says that the normal weekly schedule will resume after that. Mr. McDonald said that he assumed that GM's legal department approved the move as legal, according to the report. The AP states that Van Conway -- mergers and acquisitions expert and partner Conway & MacKenzie ? said that the reimbursement delay means that GM knows it will run low on cash, and dealers may be most able to take the hit without hurting the firm. The report quoted Mr. Conway as saying, "They must have weekly projections here that show them bumping on their minimums. I think they're scraping the bottom of the barrel here." About General Motors Headquartered in Detroit, Michigan, General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- was founded in 1908. GM employs about 266,000 people around the world and manufactures cars and trucks in 35 countries. In 2007, nearly 9.37 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. General Motors Latin America, Africa and Middle East, with headquarters in Miramar, Florida, is one of GM's four regional business units. GM LAAM employs approximately 37,000 people in 18 countries and has manufacturing facilities in Argentina, Brazil, Colombia, Ecuador, Egypt, Kenya, South Africa and Venezuela. GM LAAM markets vehicles under the Buick, Cadillac, Chevrolet, GMC, Hummer, Isuzu, Opel, Saab and Suzuki brands. As reported in the Troubled Company Reporter on Nov. 10, 2008, General Motors Corporation's balance sheet at Sept. 30, 2008, showed total assets of $110.425 billion, total liabilities of $170.3 billion, resulting in a stockholders' deficit of $59.9 billion. * * * As reported in the Troubled Company Reporter on Nov. 11, 2008, Standard & Poor's Ratings Services lowered its ratings, including the corporate credit rating, on General Motors Corp. to 'CCC+' from 'B-' and removed them from CreditWatch, where they had been placed with negative implications on Oct. 9, 2008. S&P said that the outlook is negative. Fitch Ratings, as reported in the Troubled Company Reporter on Nov. 11, 2008, placed the Issuer Default Rating of General Motors on Rating Watch Negative as a result of the company's rapidly diminishing liquidity position. Given the current liquidity level of $16.2 billion and the pace of negative cash flows, Fitch expects that GM will require direct federal assistance over the next quarter and the forbearance of trade creditors in order to avoid default. With virtually no further access to external capital and little potential for material asset sales, cash holdings are expected to shortly reach minimum required operating levels. Fitch placed these on Rating Watch Negative: -- Senior secured at 'B/RR1'; -- Senior unsecured at 'CCC-/RR5'. As reported in the Troubled Company Reporter on June 24, 2008, DBRS has placed the ratings of General Motors Corp. and General Motors of Canada Limited Under Review with Negative Implications. The rating action reflects the structural deterioration of the company's operations in North America brought on by high oil prices and a slowing U.S. economy. GENTIVA HEALTH: Moody's Maintains 'Ba3' Corporate Family Rating --------------------------------------------------------------- Moody's Investors Service affirmed the ratings of Gentiva Health Services, Inc. including the Ba3 Corporate Family Rating and Ba3 rating on the senior secured credit facility. Moody's also affirmed the Speculative Grade Liquidity rating of SGL-2. The rating outlook remains stable. The rating affirmation follows Gentiva's sale of 69% of its CareCentrix business unit for total consideration of approximately $135 million and subsequent repayment of approximately $80 million of debt using both the sale proceeds and free cash flow. Moody's believes the divestiture improves the company's financial flexibility and should allow for increased focus on the company's core home health business. The affirmation of the SGL-2 reflects Moody's belief that the company will continue to have good liquidity over the next twelve months, benefiting from the CareCentrix sale and free cash flow which allowed the company to repay amounts outstanding on its revolver and increase its cash balance. The Ba3 Corporate Family Rating reflects risks inherent in the home healthcare business including: high exposure to Medicare and Medicaid and vulnerability to potential unfavorable regulatory or reimbursement changes; and challenges hiring and retaining qualified nurses and therapists, of which there are nationwide shortages. The ratings are currently constrained by Moody's expectation that the company will likely continue to be acquisitive which could potentially result in increased financial leverage and/or integration risk. The Ba3 Corporate Family rating is supported by Gentiva's position as one of the largest home healthcare providers in the US, its good geographic diversity within the US and financial metrics that are generally in-line with the Current Rating. Ratings Affirmed; LGD point estimates revised ? $96.5 million Senior Secured Revolver, due 2012, rated Ba3, LGD3, 32% (from Ba3, LGD3, 34%) ? $251 million Senior Secured Term Loan B, due 2013, rated Ba3, LGD3, 32% (from Ba3, LGD3, 34%) ? Corporate Family Rating, rated Ba3 ? Speculative Grade Liquidity Rating, SGL-2 The outlook is stable. Moody's Prior Rating action was on Feb. 8, 2006 when Moody's assigned first time ratings to Gentiva. Gentiva is a leading provider of comprehensive home health services in the US. The company offers direct home nursing and therapies, including specialty programs, as well as hospice, home infusion and respiratory therapy and durable medical equipment products. Pro forma for the divestiture of CareCentrix, Moody's estimates that Gentiva would have generated approximately $1.0 billion in revenue for the twelve months ended Sept. 28, 2008. GEORGIA MAINTENANCE: Case Summary & 20 Largest Unsec. Creditors --------------------------------------------------------------- Debtor: Georgia Maintenance and Contracting, Inc. 2435 Rock Springs Road Buford, GA 30519 Bankruptcy Case No.: 08-95017 Chapter 11 Petition Date: November 12, 2008 Court: U.S. Bankruptcy Court Northern District of Georgia (Atlanta) Judge: Joyce Bihary Debtor's Counsel: Paul Reece Marr Paul Reece Marr, P.C. 300 Galleria Parkway, N.W., Suite 960 Atlanta, GA 30339 770-984-2255 Fax : (770) 984-0044 Email: pmarr@mindspring.com Total Assets: $1,988,400 Total Debts: $3,382,515 A list of the Debtor's 20 largest unsecured creditors is available for free at: http://bankrupt.com/misc/ganb08-95017.pdf GETRAG TRANSMISSION: Case Summary & 20 Largest Unsec. Creditors --------------------------------------------------------------- Debtor: Getrag Transmission Manufacturing LLC 35533 Mound Road Sterling Heights, MI 48310 Bankruptcy Case No.: 08-68112 Type of Business: The Debtor designs and makes dual clutch transmission its facility in Tipton, Indiana. http://www.getrag.de Chapter 11 Petition Date: November 17, 2008 Court: Eastern District of Michigan (Detroit) Judge: Marci B McIvor Debtor's Counsel: Jayson Ruff, Esq. jruff@mcdonaldhopkins.com Jeffrey S. Grasl, Esq. jgrasl@mcdonaldhopkins.com Stephen M. Gross, Esq. sgross@mcdonaldhopkins.com 39533 Woodward Avenue, Suite 318 Bloomfield Hills, MI 48304 Tel: (248) 646-5070 Estimated Assets: $100 million to $500 million Estimated Debts: $500 million to $1 billion The Debtor's Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Conti Temic microlectronic trade debt $99,120,000 GmbH Attn: Arthur Kohapka Sieboldstrabe 19 90411 Numberg, Germany Tel: (499) 119-5262 872 BorgWarner Transmission trade debt $60,956,522 Systems Attn: Pete Manos 3800 Automation Ave., Ste. 500 Auburn Hills, MI 48326 Tel: (248) 754-0519 Walbridge Aldinger Company trade debt $43,758,752 Attn: Mickey O'Hearn 777 Woodward Ave., Ste. 300 Detroit, MI 48226 Tel: (313) 442-1215 LSW Mashinenfabrik GmbH trade debt $31,283,333 Attn: Erwin Lowenstein Uhthoffstrasse 1, D-28757 Bremen, Germany Tel: (494) 216-6021 34 Selzer Fertigungstechnik trade debt $25,111,032 GmbH Attn: Tobias Selzer Bahnhhofstrabe 1 35759 Driedorf-Roth, Germany 35757 Tel: (491) 757-2691 55 ThyssenKrupp EGM GmbH trade debt $24,629,853 Attn: Heiko Breitbeck Bayernstrabe 17 D-30855 Langenhagen, Germany Tel: (495) 117-4091-502 ALD Vacuum Technologies GmbH trade debt $17,392,077 Attn: Gerald Hiller Wilhelm Rohn Str. 35, D-63450 Hanu, Germany Tel: (496) 181-3073 508 Thomas Magnete GmbH trade debt $16,109,130 Attn: Dietrich Thomas San Fernando 35 D-57562 Herdorf Germany Tel: (492) 744-9290 Assembly & Test Europe GmbH trade debt $15,161,143 Attn: Thomas Wildt Carl-Borgward-Strabe 11 D-56566 Neuweid Germany Tel: (492) 631-3821 50 Felsomat GmbH & Cie KG trade debt $14,581,000 Attn: Uwe King Gutenbergstrabe 12, D-75203 Konigsbach-Stein, Germany Tel: (497) 232-4012 49 Industrial Power Systems Inc. trade debt $8,728,561 Attn: John Gray 410 Ryder Road Toledo, OH 43607 Tel: (419) 531-3121 Unior d.d. trade debt $7,401,482 Attn: Bostjan Leskovar Kovaska Cesta 10, SL-3214 Zrece, Slovenija Tel: (386) 375-7847 2 Prawema Antriebstechnik GmbH trade debt $6,603,800 Attn: Jorg Schieke Hessenring 4, D-37269 Echwega/Werra, Germany Tel: (495) 651-8008 27 Moorehead Electric Co. Inc. trade debt $6,350,421 Attn: Tom Brodt PO Box 427 1702 W. Jeffras Ave. Marion, IN 46952 Tel: (765) 669-8139 JG Weisser Sohne GmbH & Co. KG trade debt $5,735,629 Attn: Helmut Weisser Bundesstrasse 1, D-78112 St. Georgen, Germany Tel: (490) 772-4881-222 Metia Corporation trade debt $5,981,581 Attn: Myung-ho Kim 750-1 Hyomun-Dong, Buk-Gu Ulsan 683-360, Korea Tel: (822) 516-0184 Stelko Electric Inc. trade debt $4,494,000 Attn: Scott Becker 2529 N. Washington St. Kokomo, IN 46901 Tel: (765) 452-2090 Klingelnberg GmbH trade debt $4,431,640 AttnL Gerhard Mohr Peterstrabe 45 D-42499 Huckeswagen, Germany Tel: (492) 192-8150 9 ABB Inc. trade debt $4,284,279 Attn: John Maloney 1250 Brown Road Auburn Hills, MI 48326 Tel: (248) 393-4616 Buderus Schleiftechnik GmbH trade debt $4,086,600 Attn: Gunter Spreemann Indusriestr 3, D-35614 Ablar, Germany Tel: (496) 441-8006-24 The petition wa signed by the company's chief executive officer James Shoup. GETRAG TRANSMISSION: Chrysler Dispute Cues Bankruptcy Filing ------------------------------------------------------------ GETRAG Transmission Manufacturing LLC has filed for protection under chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Eastern District of Michigan for its Tipton, Indiana facility. The company's Tipton facility was being constructed for the sole purpose of manufacturing dual clutch transmissions for Chrysler LLC. The company said it owes $500 million to over 200 parties related to the cost of construction of the plant, many of whom asserted liens against the project under Indiana law. The Chapter 11 filing is a direct result of a recent termination by Chrysler of contractual agreements related to the construction and operation of a dual clutch transmission manufacturing facility in Tipton. Also as a result of Chrysler's actions, the company has been forced to terminate its operations in Tipton and cancel the project. In addition, the filing will enable the company to deal with all claims related to the project in an orderly and equitable fashion. The company and its German affiliate also filed a countersuit on Oct. 30, 2008, against Chrysler to recover, among other elements, costs associated with the project and reimbursement of all expenses incurred by the company and its suppliers in connection with the project. "We recognize these developments have had significant impact on all of our stakeholders, including employees, suppliers and the Tipton community," said Jim Shoup, GTM LLC Chief Executive Officer. "We ask for their patience and understanding as we manage through this process." Shoup also indicated the organization will continue to update the creditors of GTM LLC throughout the process. Transmission Supply Agreement With Chryler Chrysler was required to purchase from the company all of its annual requirements for dual clutch transmissions up to certain volumes through model year 2020, with production to commence October 2009 under the Transmission Supply Agreement between the parties. The agreement also required Chrysler to reimburse the company for up to $305 million for machinery and equipment and tooling costs. Moreover, the agreement allowed the company to obtain from banks or financial institutions senior debt financing from the supply of the DCT to Chrysler. Simultaneously with the TSA agreement, Chrysler and the comnpany entered into a limited company agreement as a joint venture company for overight of the project. The LLC agreement set procedures for resolution of disputes arising out of the TSA. The company's German affiliate GETGRAG KG aslo entered into a guaranty agreement, wherein GETRAG will contribute $140 million in cash as capital for the company towards project. Along with the two agreements, the company, GETRAG KG and Chrysler entered into a finance option agreement dated March 11, 2008 for the purpose of governing the financing project. Under the FOA, the company and GETRAG KG agreed to use up to $300 million in debt financing to fund the design, construction, equipment and operation of the plant. Financing for the project was to have been arranged within 90 days of the execution of the FOA, subject of adequate assurance by Chrysler; However, no financing was able to be secured as Chrysler failed to give adequate assurances to lenders as required by the FOA. The FOA contemplated that debtor financing may not be obtained. As a result, Chrysler agree to backstop the company's and GETRAG KG's investment in and financial commitment to the project. As of July 2008, Chrysler had authorized project costs and expenses in excess of $437 million. Termination of Agreements Chrysler said in a letter on Oct. 17, 2008, it was terminating the FOA, TSA and all other related agreements with respect to the project, and commenced litigation against the company and GETRAG KG in the 6th Judicial Circuit Court for the state of Michigan seeking a determination that Chrysler is not obliged to perform under the projects agreements due to alleged contract breach and fraud but the company and GETRAG KG denied all allegations. Headquartered in Sterling Heights, Michigan, GETRAG Transmission Manufacturing LLC -- http://www.getrag.de?- designs and makes dual clutch transmission its facility in Tipton, Indiana. GLACIER FUNDING: Eroding Credit Quality Cues Moody's Rating Cuts ---------------------------------------------------------------- Moody's Investors Service downgraded and left on review for possible downgrade these notes issued by Glacier Funding CDO I Limited: Class Description: U.S.$44,000,000 Class A-2 Second Priority Senior Floating Rate Notes Due 2039 -- Prior Rating: Aaa -- Prior Rating Date: 3/31/2004 -- Current Rating: Aa2, on review for possible downgrade Class Description: $43,500,000 Class B Third Priority Senior Floating Rate Notes Due 2039 -- Prior Rating: Aa2 -- Prior Rating Date: 3/31/2004 -- Current Rating: Baa2, on review for possible downgrade Class Description: U.S.$9,000,000 Class C Mezzanine Floating Rate Notes Due 2039 -- Prior Rating: Baa2 -- Prior Rating Date: 3/31/2004 -- Current Rating: C According to Moody's, these rating changes are the result of the deterioration in the credit quality of the transaction's underlying collateral pool, consisting primarily of structured finance securities. Moody's notes that principal proceeds were drawn upon to pay required interest due on the Class B Notes on the recent payment date due to inadequate interest proceeds. Moreover, collateral par has continued to deteriorate and WARF has increased since the prior Moody's rating action. Moody's also notes that the Class C Notes are deferring interest and the junior test of overcollateralization is failing. GLOBAL CREDIT: S&P Downgrades Ratings on Preferred Shares to 'CCC' ------------------------------------------------------------------ Standard & Poor's Ratings Services lowered its ratings on Global Credit Pref. Corp.'s preferred shares. The ratings remain on CreditWatch with negative implications, where they were placed Sept. 25, 2008. The lowering of the ratings and the CreditWatch placement mirrors the lowering of the rating and the CreditWatch placement on the credit-linked note to which the preferred shares are linked. Ratings List Global Credit Pref Corp. Ratings Lowered, Remaining On CreditWatch Negative To From -- ---- Preferred shares Global scale CCC/Watch Neg B/Watch Neg National scale P-5/Watch Neg P-4/Watch Neg (Related CLN: The Toronto-Dominion Bank C$48,031,000 Portfolio Credit-Linked Notes.) GREEKTOWN HOLDINGS: Exclusive Plan Filing Period Extended Dec. 15 ------------------------------------------------------------------ Greektown Holdings LLC and its debtor-affiliates currently have the exclusive right to file a plan of reorganization through Dec. 15, 2008. They also have the exclusive right to solicit acceptances of that plan through Feb. 16, 2009. According to Daniel J. Weiner, Esq., at Schafer and Weiner PLLC, in Bloomfield Hills, Michigan, the Debtors need a 60-day extension of their Exclusivity Period to allow for the completion of the process demanded by their major creditors and key parties- in-interest and approved by the the United States Bankruptcy Court for the Eastern District of Michigan, namely the retention of Moelis & Company LLC as their investment banker; the completion by the investment banker of a data room by Nov. 17, 2008; and the generation of expressions of interest for either a sale or reorganization of the Debtors' estates. Thus, by this motion, the Debtors seek to further extend: (a) their Exclusive Plan Filing Period through Feb. 15, 2009; and (b) their Exclusive Solicitation Period through April 16, 2009. Mr. Weiner informs the Court that Moelis has been working diligently to adhere to the benchmarks established by the settlement with the Objecting Parties to the original Exclusivity Motion. The Debtors also disclose that they are nearing completion of the permanent Greektown Casino entertainment complex, which includes the permanent casino, a 400-room luxury hotel, exhibit and banquet rooms and a theatre venue. As part of the Entertainment Complex, the Debtors are opening a new Pantheon Room and new private valet entrance for high-stakes patrons and a new buffet. Mr. Weiner says completion and opening of the Amenities is expected by early December 2008. It is expected to strengthen the Debtors' position in the Detroit marketplace as well as increase revenues, he avers. The Debtors expect to open the first 200 rooms of the Hotel beginning in January 2009, in time for the North American International Auto Show scheduled for mid-January 2009 and to accept reservations for the 2009 NCAA Final Four playoffs scheduled for early April 2009. The entire Hotel is scheduled to open on Feb. 12, 2008. The Debtors add that they are in the process of making certain management changes, including: -- A reduction of the Board of Directors members from 12 to five to be selected and approved through an intensive process that includes the input of key parties-in-interest in the Debtors' bankruptcy case. Four of the Board members will be independent and new to the Board. Three proposed independent Board members are currently in the Michigan Gaming Control Board approval process and will take their seats on the Board if approved by the MGCB. A fourth independent Board member is currently being sought by the Debtors. -- Craig Ghelfi, the Debtors' chief executive officer, has announced his resignation effective October 31, 2008. The Debtors are currently undertaking a process to identify a replacement CEO, and have sought and received input regarding a suitable replacement CEO from key parties-in- interest. Furthermore, Mr. Weiner contends that the national, regional, and local economic environments have substantially changed since the Petition Date, presenting additional challenges to the Debtors' ongoing restructuring efforts in general and to the efforts of Moelis in particular. Mr. Weiner also avers that the Debtors' request is warranted for these reasons: -- The Debtors' cases are large and complex, with multiple Debtor estates, hundreds of creditors, complex loan and other agreements, multiple regulatory agencies and municipalities, and unique issues related to gaming; -- The Debtors are paying all of their bills as they come due; -- The Debtors are continuing to make progress in negotiations with its creditors, meeting regularly with the DIP Lenders and other creditors towards the shared goal of a reorganization that represents the best outcome for the estate and all of its creditors and parties in interest; and -- The Debtors seek a modest extension of the Exclusivity period so as to give meaning to, the process put in place by the Settlement and the Exclusivity Order. "Adherence to the Current Plan Period date of December 15, 2008 would . . . ignore the realities of, and in fact impede, the process that was instituted at the behest of all the key parties- in-interest in this case, a process which is well underway," Mr. Weiner argues. A hearing on the Debtors' request was held on Nov. 17, 2008, at 11:00 a.m., before Judge Shapero. About Greektown Casino Based in Detroit, Michigan, Greektown Holdings, LLC and its affiliates -- http://www.greektowncasino.com/-- operates world- class casino gaming facilities located in Detroit's historic Greektown district featuring more than 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 as 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. 16; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). GREENWICH CAPITAL: Fitch Takes Various Rating Actions on Certs. --------------------------------------------------------------- Fitch Ratings downgrades one class of Greenwich Capital Commercial Funding Corporation, series 2006-FL4, commercial mortgage pass- through certificates: -- $7.2 million class K to 'BB' from 'BBB-'; Outlook Negative; Fitch also downgrades these rakes: -- $2.3 million class N-NZH to 'BB-' from 'BBB-'; Outlook Negative -- $1.6 million class N-NW to 'B+' from 'A-'; Outlook Negative; -- $899,005 class O-NW to 'B' from 'BBB+'; Outlook Negative; -- $961,005 class P-NW to 'B' from 'BBB'; Outlook Negative; -- $1.2 million class Q-NW to 'B' from 'BBB-'; Outlook Negative; -- $993,129 class N-WYN to 'BB-' from 'BBB-'; Outlook Negative. In addition, Fitch downgrades and removes from Rating Watch Negative these rakes: -- $1.4 class N-2600 to 'BB+' from 'AA-'; Outlook Stable; -- $2.0 million class O-2600 to 'BB' from 'A-'; Outlook Stable; -- $1.3 million class P-2600 to 'BB' from 'BBB'; Outlook Stable; -- $1.7 million class Q-2600 to 'BB-' from 'BBB-'; Outlook Stable; Also, Fitch affirms these classes: -- $104.3 million class A-1 at 'AAA'; Outlook Stable; -- $230.4 million class A-2 at 'AAA'; Outlook Stable; -- Interest-only class X-1 at 'AAA'; Outlook Stable; -- $35.4 million class B at 'AA+'; Outlook Stable; -- $30.7 million class C at 'AA'; Outlook Stable; -- $18.0 million class D at 'AA-'; Outlook Stable; -- $16.7 million class E at 'A+'; Outlook Stable; -- $11.3 million class F at 'A'; Outlook Stable; -- $15 million class G at 'A-'; Outlook Negative; -- $17.6 million class H at 'BBB+'; Outlook Negative; -- $14.2 million class J at 'BBB'; Outlook Negative; -- $17.8 MM class L at 'BB-'; Outlook Negative. Fitch also affirms these non-pooled trust assets (rakes): -- $2.2 million class N-MET 'BBB'; Outlook Stable; -- $6.6 million class O-MET 'BBB-'; Outlook Stable; -- $770,025 class N-E161 'BBB-'; Outlook Stable; -- $894,087 class N-SCR 'BBB'; Outlook Stable; -- $1.4 million class O-SCR 'BBB-'; Outlook Stable. The rake classes N-LAX, N-CPH, O-CPH, P-CPH, Q-CPH, S-CPH, N-LDC, O-LDC, P-LDC, N-LJS, N-HAP, O-HAP, P-HAP, N-444, and O-444 have paid in full. The downgrade of class K is a result of lowering the shadow ratings on the following six loans in the pool: PGA National Resort and Spa (13.7%), ResortQuest Waikiki Beach (11.4%), NineZero Hotel (5.7%), Mondrian - Scottsdale (4.2%), Wyndham Hotel - Orange County (2.73%), and Northwest Plaza Shopping Center (4.53%). The Galleria Sheraton - Metairie loan (1.52%) was downgraded in Fitch's previous review in July, 2008. The downgrade of class N-NZH is due to the declining performance at the Nine Zero Hotel property, located in Boston, Massachusetts. The decline in the performance at the property is attributed to a general increase in expenses, both departmental and variable. Occupancy and revenue per average room have remained stable since issuance at 76.5% and $212.77, respectively. The downgrade to classes N-NW, O-NW, P-NW and Q-NW is attributed to the significantly declining performance of the Northwest Plaza Shopping Center. One of the anchor tenants, Steve and Barry's, has recently filed for bankruptcy and will be vacating the property. Rental revenue at the property will be significantly impacted by the loss of the anchor tenant, following an otherwise steady decline of occupancy and performance since issuance. In addition, many of the in-line tenants have co-tenancy provisions in the leases which are currently not being met. The borrower will not proceed with the original redevelopment plans of the property. The loan recently transferred to the special servicer who has began negotiations with the borrower. Fitch expects some losses to the pool upon the resolution of this asset. The downgrade to classes N-2600, O-2600, P-2600 and Q-2600 is attributed to the decline in the performance of the 2600 West Olive Avenue loan. At last review, Fitch placed the four rake classes on Rating Watch Negative to reflect the lack of leasing activity at the property. Performance has not improved since last review with no additional leases signed to date. Occupancy remains at 46%. In addition, the local market outlook for rental rates and occupancy is less favorable than at the time of issuance. The borrower continues to market the vacancies. The downgrade to the N-WYN class is attributed to the decline in performance of the Wyndham Hotel Orange County. While revenues from operations have remained stable since issuance, there has been an overall increase in expenses resulting in a decline in operating cash flow. Occupancy and RevPAR have remained stable since issuance at 78.6% and $91, respectively. The affirmations are due to expected performance since issuance. As of the November 2008 remittance, the transaction has paid down by 45.9%. Fourteen loans have paid in full. The transaction consists of loans collateralized by hotel properties (41.9%), office (36.6%), retail (9.2%), condominium conversion (4.6%), multifamily (3.1%) and mixed use (1.4%). At issuance, 15.3% of the pool was collateralized by condominium conversion loans and 3.6% by land. The largest loan remaining in the transaction is Metropolitan Tower (13%). The loan is secured by the condominium ownership of the first 18 stories of a 66-story office & residential building located on West 57th Street between 6th and 7th Avenue in Manhattan. The property has been undergoing renovations. The building was over 60% vacant at issuance but having undergone extensive renovations, the vacant space is being marketed and leased. Occupancy as of November 2008 is approximately 91%. The property continues to perform inline with the business plan presented at issuance. GWLS HOLDINGS: Court OKs Jan. 9 Auction for All Assets ------------------------------------------------------ The Hon. Peter Walsh of the United States Bankruptcy Court for the District of Delaware approved bidding procedure for the sale of substantially all of the assets of GWLS Holdings Inc. and its debtor-affiliates. According to Bloomberg, lender made a bid in exchange for $370 million the Debtors' are owed for ownership of the trucking and warehousing company. Offer for the Debtors' assets along with a $3.75 million minimum good faith deposit must be delivered by Jan. 6, 2008, at 12:00 noon (prevailing Eastern Time). An auction will take place on Jan. 9, 2009, at 10:00 a.m. (prevailing Eastern Time) at the offices of Young Conaway Stargatt & Taylor LLP followed by a sale hearing on Jan. 15, 2009, at 3:00 p.m. (prevailing Eastern Time). Objections to the sale of the purchase assets, if any, are due Jan. 12, 2009, by 4:00 p.m. (prevailing Eastern Time). The lenders will be paid $7.5 million in the event the Debtors consummates the sale to another party. A full-text copy of the asset purhcase agreement with the lender is available for free at http://ResearchArchives.com/t/s?34e9 About GWLS Holdings Headquartered in Dallas, Texas, GWLS Holdings Inc. -- http://www.greatwide.com/-- operate trucking and logistics company. The company and 50 of its affiliates filed for Chapter 11 protection on Oct. 20, 2008 (Bankr. D. Del. Lead Case No. 08-12430). Robert S. Brady, Esq., and Matthew B. Lunn, Esq., at Young, Conaway, Stargatt & Taylor LLP; Matt A. Feldman, Esq., Paul V. Shalhoub, Esq., and Robin Spigel, Esq., at Willkie Farr Gallagher LLP, represent the Debtors' as co-counsel. Miller Buckfire & Co., LLC, is the Debtors' financial advisor. When the Debtors filed sought bankruptcy protection from their creditors, they listed assets and debts between $500 million and $1 billion each. HARRAH'S ENTERTAINMENT: Bondholders to Get Cents in Debt Swap ------------------------------------------------------------- Harrah's Entertainment, Inc. said on Friday that its direct wholly-owned subsidiary, Harrah's Operating Company, Inc., is commencing private exchange offers to exchange certain of its outstanding debt securities for up to $2.1 billion aggregate principal amount of (i) new 10.00% Second-Priority Senior Secured Notes due 2015, for Old Notes maturing between 2010 and 2013, and (ii) new 10.00% Second-Priority Senior Secured Notes due 2018, for Old Notes maturing between 2015 and 2018. Acceptance CUSIP/ISIN Old Notes Priority Level ---------- --------- -------------- 413627AQ3/ 5.50% Senior Notes due 2010 1 US413627AQ32 ______________________________________________________________ 700690AQ3/ 7.875% Senior Subordinated Notes due 2010 1 US700690AQ34 ______________________________________________________________ 413627AH3/ 8.0% Senior Notes due 2011 1 US413627AH33 ______________________________________________________________ 700690AL4/ 8.125% Senior Subordinated Notes due 2011 US700690AL47 700690AK6/ US700690AK63 U70230AA2/ USU70230AA22 ______________________________________________________________ 413627AN0/ 5.375% Senior Notes due 2013 1 US413627AN01 ______________________________________________________________ 413627AU4/ 5.625% Senior Notes due 2015 2 US413627AU44 ______________________________________________________________ 413627AX8/ 6.5% Senior Notes due 2016 2 US413627AX82 ______________________________________________________________ 413627AW0/ 5.75% Senior Notes due 2017 2 US413627AW00 ______________________________________________________________ 413627AZ3/ 10.75%/11.5% Senior Toggle Notes due 2018 3 US413627AZ31 U24658AK9/ USU24658AK95 ______________________________________________________________ U24658AJ2/ 10.75% Senior Notes due 2016 4 USU24658AJ23 413627AY6/ US413627AY65 ______________________________________________________________ The New Second Lien Notes will be guaranteed by Harrah's and will be secured on a second-priority basis by substantially all of the assets of HOC and the assets of HOC's wholly-owned domestic subsidiaries that have pledged their assets to secure HOC's obligations under its senior secured credit facilities to the extent such assets secure obligations under such senior secured credit facilities. The New Second Lien Notes will not, however, be secured by liens on HOC's or any of HOC's subsidiaries' capital stock. The purpose of the Exchange Offers is to reduce the outstanding principal amount of indebtedness of HOC and to extend the weighted average maturity of HOC's outstanding indebtedness. In addition to the issuance of New Second Lien Notes, holders of Old Notes maturing in 2010 and 2011 participating in the Exchange Offers may elect to receive cash in lieu of New 2015 Second Lien Notes that they would otherwise receive in the Exchange Offers pursuant to a "Modified Dutch Auction" process. The company has prepared a confidential offering memorandum in connection with the Exchange Offers. Only holders of Old 2010-2011 Notes participating in the Exchange Offers may participate in the Auction Process. Participation in the Auction Process is optional. Accordingly, holders of Old 2010-2011 Notes may participate in the Exchange Offers without participating in the Auction Process. HOC will not pay more than $325 million to auction participants in lieu of New 2015 Second Lien Notes that such participants would otherwise receive in exchange for Old 2010-2011 Notes. Subject to the terms and conditions of the Exchange Offers, including the proration terms, Old Notes properly tendered (and not withdrawn) will be accepted in order of the Acceptance Priority Levels, with Level 1 being the highest priority level. The aggregate principal amount of Old Notes with an Acceptance Priority Level of 2 that are validly tendered (and not withdrawn) and accepted in the Exchange Offers will not exceed $875 million and the aggregate principal amount of Old Notes with an Acceptance Priority Level of 3 that are validly tendered (and not withdrawn) and accepted in the Exchange Offers will not exceed $462 million. In addition, the aggregate principal amount New Second Lien Notes issued in the Exchange Offers will not exceed the lesser of (i) the Maximum Exchange Amount and (ii) an amount that would result in the estimated cancellation of indebtedness income, as determined immediately following the Expiration Date, attributable to the Old Notes properly tendered and not withdrawn and accepted in the exchange offers to exceed $1.8 billion. Holders who validly tender their Old Notes on or prior to 5:00 p.m., New York City time, on November 28, 2008, and whose Old Notes are accepted by HOC in the Exchange Offers will receive an early participation consideration of $30.00 in principal amount of New Second Lien Notes per $1,000 principal amount of Old Notes. Bloomberg News' Caroline Salas says holders of Harrah's $1 billion of 5.625% senior notes due in 2015, its $750 million of 6.5% securities maturing in 2016 and its $750 million of 5.75% debt due in 2017 will receive 40 cents-on-the-dollar's worth of new 2018 notes. Those who tender after 5 p.m. on Nov. 28 and by Dec. 12 will receive 37 cents worth of new debt, Bloomberg says. Ms. Salas also notes that holders of Harrah's $718 million of 5.5% notes due in 2010 and its $363 million of 7.875% senior subordinated notes due in 2010 will receive as much as 100 cents on the dollar worth of 2015 notes. Harrah's $328 million of 8.125% senior subordinated notes due 2011 and its $500 million of 5.375% senior notes due in 2013 will be exchanged at a rate of 80 cents and 50 cents of new 2015 debt, according to Ms. Salas. The Exchange Offers are not conditioned on a minimum principal amount of Old Notes being tendered or the issuance of a minimum principal amount of New Second Lien Notes. However, the Exchange Offers are subject to certain other conditions. In addition, HOC has the right to terminate or withdraw any of the Exchange Offers at any time and for any reason, including if any of the conditions described in the Offering Memorandum are not satisfied. Each of the Exchange Offers will expire at midnight, New York City time, on December 12, 2008, unless any of them is extended. Tenders may be withdrawn prior to 5:00 p.m., New York City time, on November 28, 2008 unless extended by HOC. Holders may withdraw tendered Old Notes at any time prior to the Withdrawal Deadline but holders may not withdraw tendered Old Notes on or thereafter. The New Second Lien Notes will accrue interest from and including the settlement date. Holders who exchange Old Notes that pay cash interest for New Second Lien Notes will receive accrued and unpaid interest to, but not including, the settlement date. Accrued pay- in-kind interest on HOC's 10.75%/11.5% Senior Toggle Notes due 2018 will not be included in determining the principal amount of any such Old Toggle Notes tendered in the exchange offers, but an estimate of the accrued interest through the anticipated Settlement Date has been included in the consideration being offered in the Exchange Offers for the Old Toggle Notes. The New Second Lien Notes have not been registered under the Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. According to Ms. Salas, the $1.4 billion of PIK toggle notes maturing in 2018 and the $4.9 billion of 10.75% senior notes due in 2016 will be swapped for new 2018 notes at rates of 57 cents and 70 cents on the dollar. She says Harrah's will give the about $2 billion of eligible 2010, 2011 and 2013 notes first priority in the exchange. The 2015, 2016 and 2017 notes being swapped at a rate of 40 cents will be given second priority, with up to $875 million in principal amount accepted, followed by up to $462 million in face value of the toggle notes, which have third priority, she adds. Ms. Salas says holders of old notes who don't tender their debt will be subordinated to the new second lien notes in a bankruptcy. According to Reuters' Dena Aubin, fixed-income research service CreditSights said in a report that if all of its legacy notes are exchanged for new notes, the company would save about $70 million annually on interest expense. The Exchange Offers are being made only to qualified institutional buyers and to certain non-U.S. investors located outside the United States. The Exchange Offers are made only by, and pursuant to, the terms set forth in the offering memorandum, and the information in this press release is qualified by reference to the offering memorandum and the accompanying letter of transmittal. Subject to applicable law, HOC may amend, extend or terminate the Exchange Offers. Documents relating to the Exchange Offers will only be distributed to holders who complete and return a letter of eligibility confirming that they are within the category of eligible investors for this private offer. Noteholders who desire a copy of the eligibility letter should contact Global Bondholder Service Corporation, the information agent for the offers, at (866) 736- 2200 (Toll-Free) or (212) 925-1630 (Collect). Ms. Salas says Bank of America Corp. and Citigroup Inc. are managing the exchange. She adds that Danielle Romero-Apsilos, spokeswoman for Citigroup, didn't immediately return a call seeking comment; and Louise Hennessy, spokeswoman for Bank of America, declined to immediately comment. About Harrah's Entertainment Las Vegas, Nevada-based Harrah's Entertainment, Inc. -- http://www.harrahs.com-- operates nearly 40 casinos across the United States, primarily under the Harrah's(R), Caesars(R) and Horseshoe(R) brand names; Harrah's also owns the London Clubs International family of casinos and the World Series of Poker(R). Private equity firms Apollo Global Management and TPG Capital LP acquired Harrah's in January for $31 billion. HERCULES INC: Ashland Merger Cues S&P's Rating Downgrades --------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on Ashland Inc. and Hercules Inc., including S&P's corporate credit ratings to 'BB-' from 'BB+', upon completion of Ashland's acquisition of Hercules. S&P removed the ratings from CreditWatch where they had been placed on July 11, 2008 with negative implications. The outlook is stable. S&P assigned a 'BB-' senior unsecured debt rating and a recovery rating of '4' to Ashland's $750 million one-year senior unsecured interim credit facility. This indicates S&P's expectation of average (30% to 50%) recovery for these lenders. The lower rating is based on S&P's current expectation of somewhat weaker earnings and cash flow in 2009 than in 2008, versus S&P's earlier expectation that earnings and credit measures would begin to strengthen in 2009. In addition, financing terms are more onerous than indicated in the preliminary plans. Ashland will incur significantly higher borrowing costs than initially expected, and required term loan amortization during the next few years will be somewhat higher. Proceeds of the new credit facilities, along with proceeds from a new $200 million accounts receivable program, cash on hand, and about $180 million of new common equity were used to fund the approximately $3.5 billion acquisition (including fees and expenses) of Hercules. The stable outlook reflects S&P's expectation that following the acquisition of Hercules, Ashland should be more profitable and exhibit more stable financial results. Although discretionary cash flow is likely to be thin during the next two years, S&P expects the majority to be used to reduce debt, and S&P believes financial policies will remain supportive of credit quality. Business challenges include weak economic conditions, volatile raw material costs, and the risk that asbestos or environmental trends could turn negative. HOMESTAR MORTGAGE: High Delinquency Rates Cues Moody's Rating Cuts ------------------------------------------------------------------ Moody's Investors Service downgraded the ratings of 14 tranches from 4 transactions issued by Homestar Mortgage Acceptance Corp. Additionally, the ratings on 7 tranches were confirmed. The collateral backing these transactions consists primarily of first- lien, fixed and adjustable-rate, Alt-A mortgage loans. Ratings were downgraded, in general, based on higher than anticipated rates of delinquency, foreclosure, and REO in the underlying collateral relative to credit enhancement levels. Also, step-down, or the possibility thereof, is likely to cause further erosion of credit support from subordination. The actions described below are a result of Moody's on-going review process. Complete rating actions are: Issuer: Homestar Mortgage Acceptance Corp. Asset-Backed Pass- Through Certificates, Series 2004-1 -- Cl. M-6, Downgraded to Baa1 from A3 -- Cl. M-7, Downgraded to Baa2 from Baa1 Issuer: Homestar Mortgage Acceptance Corp. Asset-Backed Pass- Through Certificates, Series 2004-2 -- Cl. M-5, Confirmed at B1 Issuer: Homestar Mortgage Acceptance Corp. Asset-Backed Pass- Through Certificates, Series 2004-3 -- Cl. M-1, Downgraded to Aa3 from Aa2 -- Cl. M-2, Downgraded to Baa2 from A2 -- Cl. M-3, Downgraded to Ba1 from A3 -- Cl. M-4, Downgraded to B2 from Baa1 -- Cl. M-5, Downgraded to Ca from Ba3 Issuer: Homestar Mortgage Acceptance Corp. Asset-Backed Pass- Through Certificates, Series 2004-4 -- Cl. M-1, Confirmed at Aa2 -- Cl. M-2, Confirmed at Aa3 -- Cl. M-3, Confirmed at A2 Issuer: Homestar Mortgage Acceptance Corp. Asset-Backed Pass- Through Certificates, Series 2004-5 -- Cl. M-1, Confirmed at Aa1 -- Cl. M-2, Confirmed at Aa2 -- Cl. M-3, Confirmed at A1 -- Cl. M-6, Downgraded to Baa2 from Baa1 -- Cl. M-7, Downgraded to Ba1 from Baa3 Issuer: Homestar Mortgage Acceptance Corp. Asset-Backed Pass- Through Certificates, Series 2004-6 -- Cl. M-4, Downgraded to Baa1 from A2 -- Cl. M-5, Downgraded to Baa3 from A3 -- Cl. M-6, Downgraded to Ba1 from Baa1 -- Cl. M-7, Downgraded to B3 from Baa2 -- Cl. M-8, Downgraded to Ca from Baa3 HOSPITAL PARTNERS: Wants Case Converted to Chapter 7 Liquidation ---------------------------------------------------------------- Dawn McCarty of Bloomberg News reports that Hospital Partners of America asked the United States Bankruptcy Court for the District of Delaware to convert its Chapter 11 reorganization case to a Chapter 7 liquidation proceeding. According to Bloomberg, the Debtor's lender refused to extend the debtor-in-possession financing that becomes payble on Friday on Nov. 21, 2008. The Debtor said it is unable to repay the facility or fund these Chapter 11 case going forward, relates Bloomberg citing papers filed with the Court. HRP MYRTLE: To Sell Assets for at Least $35-Mil. at Auction ----------------------------------------------------------- Ben Fidler at the Deal reports that HRP Myrtle Beach Holdings LLC asked the United States Bankruptcy Court for the District of Delaware to hold an auction for the sale of its assets. According to Mr. Fidler, the company set $35 million as minimum offer. The company is selling its assets without a stalking- horse bidder, he notes. The proceeds of the sale will pay the company's prepetition senior revolving debt, debtor-in-possession loan and certain administrative expense, the Deal relates. Remaining proceeds will be placed in escrow, the report notes. Bids for the company's assets must be delivered by Dec. 12, 2008, at the offices of Paul, Hasting , Janofsky & Walker LLP followed by a sale hearing on Dec. 18, 2008, Mr. Fidler says. The Court set Nov. 20, 2008, to consider approval of the motion, Mr. Fidler notes. About HRP Myrtle Based in Myrtle Beach, South Carolina, HRP Myrtle Beach Holdings, LLC -- owns and operates Hard Rock Park, a rock-n-roll theme park in Myrtle Beach, South Carolina, under a long-term license agreement with Hard Rock Cafe International (USA), Inc. The company and six of its affiliates filed for Chapter 11 protection on Sept. 24, 2008 (Bankr. D. Del. Lead Case No. 08-12193). Steven Goodwin will serve as the Debtors' chief executive officer. The U.S. Trustee for Region 3 has not appointed creditors to serve on an Official Committee of Unsecured Creditors. When the Debtors filed for protection from their creditors, they listed assets and debts of between $100 million and $500 million each IMMUNICON CORP: Court Confirms 4th Amended Plan of Liquidation -------------------------------------------------------------- The Hon. Kevin J. Carey of the United States Bankruptcy Court for the District of Delaware confirmed a fourth amended Chapter 11 plan of liquidation dated Oct. 13, 2008, filed by Immunicon Corporation and its debtor-affiliates. Judge Carey found that the amended plan of liquidation met the requirements under Section 1129 of the United States Bankruptcy Code. Robert F. Troisio will serve as liquidating trustee under the plan. On the plan's effective date, all of the Debtors' assets and liabilities -- including claims against the Debtors -- will be consolidated and no distirbutions will be made under the plan on account of any intercompany claims, among other things. Treatment of Interests and Claims Type Class of Claims Treatment Status ----- --------- --------- ------ unclassified administrative and unimpaired Deemed to priority tax accept 1 priority unimpaired Deemed to accept 2 general unsecured impaired Entitled to vote 3 director & officer impaired Entitled to liability vote 4 existing common impaired Entitled to stock vote 5 existing options imparied Deemed to and warrants reject The holder of allowed Class 1 claims will be paid the full amount with interest from Class 1 available cash by the distribution date and 15 days after the date on which the claim becomes an allowed priority claim. Holders of Class 2 claims will receive its pro rata share of the Class 2 available cash plus postpetition interest while holder of Class 3 claims will also receive its pro rata share from the director and officer reserve in the maximum amount of up to $500,000. Class 4 and 5 will be cancelled under the plan. A full-text copy of the Debtors' fourt amended Chapter 11 plan of liquidation is available for free at: http://ResearchArchives.com/t/s?34e7 JEM YELKOVAN: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: JEM YELKOVAN 547 E ROCKWOOD BLVD SPOKANE, WA 99202 Bankruptcy Case No.: 08-04758 Chapter 11 Petition Date: November 14, 2008 Court: United States Bankruptcy Court Eastern District of Washington (Spokane/Yakima) Judge: Patricia C Williams Debtor's Counsel: John F Bury Murphy Bantz Bury PS 818 W Riverside #631 Spokane, WA 99201-0989 509 838-4458 Fax: 509 838-5466 Email: jbury@mbandbps.com Total Assets: $1,395,858 Total Debts: $1,735,058 A list of the Debtor's 20 largest unsecured creditors is available for free at: http://bankrupt.com/misc/waeb08-04758.pdf JL BUILDING: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: JL Building, LLC 7613 South Jordan Landing Blvd. West Jordan, UT 84084 Bankruptcy Case No.: 08-27671 Chapter 11 Petition Date: November 3, 2008 Court: District of Utah (Salt Lake City) Judge: William T. Thurman Debtor's Counsel: Russell S. Walker, Esq. rwalker@wklawpc.com Woodbury & Kesler Suite 300, 265 East 100 South Salt Lake City, UT 84111 Tel: (801) 364-1100 Fax: (801) 359-2320 Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A copy of the Debtor's list of unsecured creditors is available for free at http://bankrupt.com/misc/utdb08-27671.pdf The Debtor's petition was signed by Steven R. Bates, Manager. JOHN KRETCHMAR: Files Schedules of Assets and Liabilities --------------------------------------------------------- John Kretchmar filed with the U.S. Bankruptcy Court for the Northern District of Illinois, his schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $3,949,000 B. Personal Property $839,990 C. Property Claimed as Exempt D. Creditors Holding $15,076,220 Secured Claims E. Creditors Holding $77,143 Unsecured Priority Claims F. Creditors Holding $17,606,388 Unsecured Non-priority Claims ----------- ----------- TOTAL $ 4,788,990 $32,759,751 Based in Chicago, John Kretchman -- http://hohnkretchmar.com/--is a broker. The Debtor filed for Chapter 11 relief on Sept. 15, 2008 (Bankr. N.D. Ill. Case No. 08-24430). Chester H. Foster, Jr., and Justin B. Foster, Esq., at Foster, Kallen & Smith represent the Debtor as counsel. JOHNSON MEMORIAL: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Johnson Memorial Hospital, Inc. 201 Chestnut Hill Road Stafford Springs, CT 06076 Bankruptcy Case No.: 08-22187 Chapter 11 Petition Date: November 4, 2008 Debtor-affiliates filing separate chapter 11 petitions: Entity Date Filed ------ ---------- Johnson Memorial Corporation Connecticut October 31, 2008 The Johnson Evergreen Corp. Connecticut October 31, 2008 Court: District of Connecticut (Hartford) Judge: Albert S. Dabrowski Debtor's Counsel: Eric A. Henzy, Esq. Reid and Riege, P.C. 1 Financial Plaza Hartford, CT, CT 06103 Tel: (860) 278-1150 Fax: (860) 240-1002 E-mail: ehenzy@reidandriege.com Estimated Assets: $0 to $50,000 Estimated Debts: $10,000,000 to $50,000,000 Debtor's list of 20 largest unsecured creditors: Entity Claim Amount ------ ------------ Key Government Finance Inc. $5,741,316 ATTN: Pres. PO Box 1187 Englewood, CO 80150-1187 National City Healthcare 1,700,376 Finance ATTN: Pres. Attn-Lease Serv/Set Up 995 Dalton Ave Cincinnati, OH 45203 Eastern Rehab. Network 717,428 ATTN: Pres. 181 Patricia M. Genova Dr. 5Th Floor Newington, CT 06111 CHA 481,368 Conn Light & Power Co. 340,543 GE Healthcare Financial 307,888 Conn Hospital Association 295,459 Medline Industries, Inc. 273,436 Depuy Orthopaedics, Inc 266,545 Transcanada PO wer 259,198 McKesson-Paragon Vendor 257,605 Daly, James W. Inc. 217,489 Saxe Doernberger & Vita, P.C. 185,111 Banc of America Leasing 179,802 North Central Counseling Services 157,505 Hartford Hospital 132,207 Somerset Capital Group,Ltd 125,486 UMS Connecticut Lithotripsy, LP 114,550 Beckman Coulter, Inc. 111,591 Unidine Corp 105,388 JP MORGAN: Moody's Reviews Ratings on Certs. for Possible Cuts -------------------------------------------------------------- Moody's Investors Service placed these certificates on review for possible downgrade from the J.P. Morgan MBS, Series 2005-R1 resecuritization transaction; -- Cl. B-1, Placed on Review for Possible Downgrade, currently Baa2 -- Cl. B-2, Placed on Review for Possible Downgrade, currently Ba1 -- Cl. B-3, Placed on Review for Possible Downgrade, currently Ba2 -- Cl. B-4, Placed on Review for Possible Downgrade, currently Ba3 -- Cl. B-5, Placed on Review for Possible Downgrade, currently B3 The certificates are backed by various residential mortgage-backed securities backed by mortgage loans. The ratings on the resecuritization certificates are based primarily on Moody's ratings on the underlying securities. The various underlying securities were downgraded from their initial ratings. The ratings review has been triggered by the rating action on the underlying securities. Moody's will resolve the ratings of the resecuritization certificates after a complete review of the capital structure of the J.P. Morgan MBS, Series 2005-R1 resecuritization transaction JUPITER HIGH-GRADE: Moody's Downgrades Ratings on Three Classes --------------------------------------------------------------- Moody's Investors Service downgraded and left on review for possible downgrade the ratings of these two classes of notes issued by Jupiter High-Grade CDO Ltd: Class Description: U.S. $82,500,000 Class A-2 Second Priority Senior Floating Rate Notes Due 2041 -- Prior Rating: Aa1, on review for possible downgrade -- Prior Rating Date: June 4, 2008 -- Current Rating: A1, on review for possible downgrade Class Description: U.S. $41,250,000 Class B Third Priority Floating Rate Notes Due 2041 -- Prior Rating: A1, on review for possible downgrade -- Prior Rating Date: June 4, 2008 -- Current Rating: Baa1, on review for possible downgrade Additionally, Moody's has downgraded the rating of one class of notes: Class Description: U.S. $14,250,000 Class C Fourth Priority Mezzanine Floating Rate Notes Due 2041 -- Prior Rating: B3, on review for possible downgrade -- Prior Rating Date: June 4, 2008 -- Current Rating: Ca According to Moody's the rating changes are the result of deterioration in the credit quality of the underlying pool of collateral, which consists in large measure of subprime RMBS, Alt- A RMBS and ABS CDOs. Moody's notes that among the factors indicating credit quality decline are continuing par deterioration, the failure of two tests of overcollateralization and an increase in the collateral weighted average rating factor since the last rating action was taken. LAS VEGAS SANDS: Removes Going Concern Doubt After Fund Raising --------------------------------------------------------------- Las Vegas Sands Corp. said in a regulatory filing with the Securities and Exchange Commission that based on the actions that management has taken subsequent to November 5, 2008, together with net proceeds obtained from the transactions, management has concluded that the substantial doubt about the company's ability to continue as a going concern has been removed. PricewaterhouseCooppers, Las Vegas Sands' auditors, previously concluded that there was substantial doubt about the company's ability to continue as a going concern. As a result of recent management actions, PwC said it has removed that substantial doubt. As reported by the Troubled Company Reporter, commencing September 30, 2008, Las Vegas Sands' U.S. senior secured credit facility and FF&E financings require the company's Las Vegas operations to comply with certain financial covenants, including to maintain a maximum leverage ratio of net debt, as defined, to trailing 12-month adjusted earnings before interest, income taxes, depreciation and amortization. To comply with the maximum leverage ratio as of December 31, 2008, and subsequent quarterly periods, the company initially concluded that it would need to (i) achieve increased levels of Adjusted EBITDA at its Las Vegas properties; (ii) decrease the rate of spending on its development projects; (iii) obtain additional financing at the parent company level, the proceeds from which could be used to reduce its Las Vegas operations' net debt; (iv) elect to contribute up to $50.0 million of capital from its cash on hand to its Las Vegas operations -- such contribution having the effect of increasing Adjusted EBITDA by up to $50.0 million per quarter for purposes of calculating maximum leverage; or in some cases (v) a combination thereof. As the Las Vegas properties did not achieve the levels of Adjusted EBITDA necessary to maintain compliance with the maximum leverage ratio for the quarterly period ending September 30, 2008, the company completed a private placement of $475.0 million in convertible senior notes with the company's principal stockholder, Sheldon Adelson, and his family and used a portion of the proceeds to exercise the EBITDA true-up provision. The EBITDA true-up, by itself, would not have been sufficient to maintain compliance with the maximum leverage ratio as of September 30, 2008. Accordingly, the entire proceeds from the offering were immediately contributed to LVSLLC to reduce the net debt of the parties to the domestic credit facilities to maintain compliance with the maximum leverage ratio for the quarterly period ending September 30, 2008. Prior to their conversion, the Convertible Senior Notes bore interest at 6.5% per annum, payable in quarterly installments, and were scheduled to mature on October 1, 2013, unless earlier converted or repurchased by the company, with an initial conversion rate of 20.141 shares of common stock per $1,000 principal amount. Following any fundamental change that might have occurred prior to the maturity date, the company would have been required to make an offer to repurchase the Convertible Senior Notes at 101% of the then outstanding principal amount. The Adelson family was granted pre-emptive rights with respect to any future proposed issuance or sale by the company of equity interests (including convertible or exchangeable securities), pursuant to which they would have been able to purchase a portion of the offered equity interests based on their fully diluted common stock ownership in the company. The company initially concluded that if the capital raising program was unsuccessful and the company did not have access to the available borrowings under the U.S. senior secured credit facility, the company would need to immediately suspend portions, if not all, of its ongoing global development projects and consider other alternatives. The company raised substantial doubt about its ability to continue as a going concern. On November 10, 2008, Las Vegas Sands announced its revised development plans and capital raising program. Given current conditions in the capital markets and the global economy and their impact on the company's ongoing operations, the company temporarily or indefinitely suspended portions of its global development projects to focus its development efforts on those projects with the highest rates of expected return on invested capital given the liquidity and capital resources available to the company. On November 14, the company completed the sale of 200,000,000 shares of its common stock and 10,446,300 shares of its 10% Series A Cumulative Perpetual Preferred Stock with warrants to purchase up to an aggregate of 174,105,348 shares of common stock, resulting in net proceeds of approximately $2.1 billion. The company sold 5,250,000 shares of Preferred Stock with Warrants to purchase up to 87,500,175 shares of its common stock to the Adelson family. The Adelson family converted their $475.0 million of Convertible Senior Notes into 86,363,636 shares of the company's common stock at a conversion price of $5.50 per share -- a conversion rate of approximately 181.818 shares per $1,000 principal amount. The company received proceeds from the sale of the Preferred Stock to the public and the Adelson family of $504.0 million and $525.0 million, respectively, net of underwriter's discounts and commissions. The company also received net proceeds from the sale of its common stock of $1.06 billion. If the holders of the Preferred Stock exercise the cash settlement feature provided under the Warrants on or prior to their expiration date, the company could receive additional proceeds of up to $1.04 billion from the issuance of shares of its common stock. About Las Vegas Sands Based in Las Vegas, Nevada, Las Vegas Sands Corp. (NYSE: LVS) -- http://www.lasvegassands.com/-- owns and operates The Venetian Resort Hotel Casino, The Palazzo Resort Hotel Casino, and an expo and convention center. The company also owns and operates the Sands Macao, the first Las Vegas-style casino in Macao, China. As of Sept. 30, 2008, the company has $14.7 billion in total assets, and $12.4 billion in total liabilities. Unrestricted cash balances as of September 30, stood at $1.28 billion while restricted cash balances were $239.1 million. Of the restricted cash balances, $199.6 million is restricted for Macao-related construction and $32.3 million is restricted for construction of Marina Bay Sands in Singapore. As of Sept. 30, total debt outstanding, including the current portion, was $10.35 billion. LB-UBS 2007-C6: Fitch Affirms & Puts Low-B Ratings on 6 Classes --------------------------------------------------------------- Fitch Ratings affirms and assigns Outlooks for LB-UBS 2007-C6,: -- $19.6 million class A-1 at 'AAA', Outlook Stable; -- $455 million class A-2 at 'AAA', Outlook Stable; -- $169 million class A-3 at 'AAA', Outlook Stable; -- $67 billion class A-AB at 'AAA', Outlook Stable; -- $910.4 million class A-4 at 'AAA', Outlook Stable; -- $422.8 million class A-1A at 'AAA', Outlook Stable; -- $40.0 million class A-2FL at 'AAA', Outlook Stable; -- $70.0 million class A-MFL at 'AAA', Outlook Stable; -- $227.9 million class A-M at 'AAA', Outlook Stable; -- $156.4 million class A-J at 'AAA', Outlook Stable; -- Interest-only class X at 'AAA', Outlook Stable; -- $33.5 million class B at 'AA+', Outlook Stable; -- $37.2 million class C at 'AA', Outlook Stable; -- $33.5 million class D at 'AA-', Outlook Stable; -- $29.8 million class E at 'A+', Outlook Stable; -- $29.8 million class F at 'A', Outlook Stable; -- $33.5 million class G at 'A-', Outlook Stable; -- $37.2 million class H at 'BBB+', Outlook Stable; -- $41.0 million class J at 'BBB', Outlook Stable; -- $29.8 million class K at 'BBB-', Outlook Stable; -- $44.7 million class L at 'BB+', Outlook Negative; -- $14.9 million class M at 'BB', Outlook Negative; -- $11.2 million class N at 'BB-', Outlook Negative; -- $3.7 million class P at 'B+', Outlook Negative; -- $7.4 million class Q at 'B', Outlook Negative; -- $7.4 million class S at 'B-', Outlook Negative. Fitch does not rate the $44.7 million class T. The rating affirmations are the result of stable performance and minimal paydown since issuance in August 2007. The affirmations of classes A-2FL and A-MFL reflect the fact that the ratings on these two classes only address receipt of the underlying fixed rate coupon and do not address the receipt of a floating rate coupon or any potential costs associated with a floating rate swap. Therefore the ratings are unaffected by the fact that the guarantor of the two floating rate swaps, Lehman Brothers Holding Inc., declared bankruptcy Sept. 14, 2008 and was in default as of Sept. 29, 2008 according to the trust documents. Fitch notes that the A-2FL swap default has been resolved as the trustee has terminated the swap per the direction of the bondholders who will receive interest payments at a fixed rate. The trustee is currently pursuing resolution to the A-MFL swap default, including termination of the swap agreement and the replacement of the swap counterparty. Both classes maintain their payment priority. Rating outlooks reflect the likely direction of rating changes over the next one to two years. As of the September 2008 distribution date, the pool's aggregate certificate balance has decreased 0.05% to $2.98 billion from $2.98 billion at issuance. Fitch has identified 17 loans of concern (11.3% of the pool), including two delinquent loans (0.17%), one of which is specially serviced (0.09% of the pool). The specially serviced loan is collateralized by a 94 unit apartment located in Lubbock, Texas that is 90+ days delinquent and transferred to special servicing in November 2007. The largest Fitch loan of concern (2.47%) is Islandia Shopping Center in Islandia, New York. Servicer reported debt service coverage ratio is 0.97 times as of year-end 2007. Occupancy as of year-end 2007 is 99.0% compared to 99.2% at issuance. The loan had a Fitch stressed DSCR of 0.94x at issuance and is currently stabilizing operations. The 707 Broad Street loan maintains an investment-grade shadow rating. Servicer reported year-end occupancy of 95.0% and DSCR of 3.65x. The transaction has minimal near-term maturity risk as only 20.5% of the loans mature in 2012, and 69.7% mature in 2017. LIGHTPOINT CLO: S&P Puts Ratings on Two Notes on Negative Watch --------------------------------------------------------------- Standard & Poor's Ratings Services placed its ratings on the class D and E notes issued by LightPoint CLO 2004-1 Ltd., an arbitrage high-yield collateralized loan obligation managed by Lehman Bros. Asset Management, on CreditWatch with negative implications. At the same time, S&P affirmed its ratings on all of the other classes from this transaction. The CreditWatch placements primarily reflect deterioration in the credit quality of the underlying collateral pool supporting the rated notes. In addition, volatile market conditions have affected the calculation of the transaction's overcollateralization ratios. Lower market values have caused the overcollateralization ratio with respect to the class A-1A notes to fall below 103%, thus triggering an event of default. The rating affirmations reflect sufficient credit to support the ratings at the current levels. Standard & Poor's will review the transaction and examine the results of current cash flow runs to determine the level of future defaults the rated classes can withstand under various stressed default timing and interest rate scenarios while still paying all of the interest and principal due on the notes. S&P will compare the results of these cash flow runs with the projected default performance of the performing assets in the collateral pool to determine whether the ratings currently assigned to the notes remain consistent with the credit enhancement available. Ratings Placed on CreditWatch Negative LightPoint CLO 2004-1 Ltd. Rating ------ Class To From Balance (million) ----- -- ---- ----------------- D BBB/Watch Neg BBB $8.500 E BB/Watch Neg BB $11.000 Ratings Affirmed LightPoint CLO 2004-1 Ltd. Class Rating Balance (million) ----- ------ ----------------- A-1A AAA $204.384 A-1B AAA $22.000 B AA+ $26.000 X A $9.840 C A- $8.500 Transaction Information ----------------------- Issuer: LightPoint CLO 2004-1 Ltd. Co-issuer: LightPoint CLO 2004-1 Corp. Underwriter: Links Securities LLC Collateral manager: Lehman Brothers Asset Management LLC Trustee: LaSalle Bank N.A. LSP ENERGY: Moody's Cuts Senior Secured Bond Rating to B3 --------------------------------------------------------- Moody's Investors Service downgraded LSP Energy Limited Partnership's rating on its senior secured bonds to B3 from B1. The rating outlook remains negative. The rating action reflects the Project's debt service coverage ratios which have remained significantly below 1 times since 2007 and the Moody's expectation that the Project is likely to draw upon its debt service reserve in January 2009 if LSP's sponsor does not contribute additional capital. In 2007 and early 2008, the Project met with operational problems which caused reduced payments through the middle of 2008 under the PPA with J Aron. Also contributing to lower cash flows in 2008 were higher than expected costs and payments to J Aron according to a PPA amendment executed in 2007. The rating action also considers Moody's expectation that LSP's DSCR is unlikely to improve beyond approximately 1 times even if the Project is able to resolve its near term liquidity problems and avoid further operating issues. Moody's notes LSP's cash flows are likely to be pressured by rising payments to J Aron under the PPA amendment. These payments terminate with the maturity of the J Aron PPA in 2013 when the project will be exposed to merchant energy market for 67% of its capacity. The negative outlook considers the Project's exposure to potential operating problems, its modest cash flow cushion against higher than expected operating costs, as well as uncertainties as to whether the Project's sponsor will be able to contribute additional equity to resolve the Project's near term liquidity problems. If LSP is unable to manage these challenges or draw more than currently anticipated from the debt service reserve, the Project's rating could face additional negative pressure. LSP's ratings could face positive rating pressure if the Project is able to sustain improved operating performance, resolve near term liquidity problems as well as achieve DSCR above 1.05 times on a sustainable basis. LSP Energy Limited Partnership is a limited partnership that owns and operates an 837 MW combined-cycle natural gas-fired electric generating facility located in Batesville, Mississippi. LSP is 96% owned by Complete Energy Holdings, a privately held operator of electric generation. Complete is headquartered in Houston, Texas and is approximately 100% owned by individuals. On May 12, 2008, CEH announced that the company will merge with GSC Acquisition Company. LYONDELL BASELL: Moody's Downgrades Rating to B3 on High Leverage ----------------------------------------------------------------- Moody's Investors Service downgraded the Corporate Family Rating of Lyondell Basell Industries AF SCA to B3 from B1. The ratings on the first lien facilities have been downgraded to B1/ LGD 2(27) and the ratings on the legacy notes of Basell and Lyondell have been downgraded to Caa2, with various LGD rates. LBI has rearranged its USD 8 billion second lien facility into USD 5.5 billion second lien facilities and USD 2.5 billion third lien facility. The new facilities have been rated Caa1/ LGD 5 (73) and Caa2/ LGD 5 (86) respectively. The outlook on the ratings remains negative. The rating action takes into account LBI's elevated leverage and the resulting limited financial flexibility, exacerbated by the conditions of the current cyclical downturn and unusually high volatility in feedstock prices. The rating action acknowledges the likely challenges in managing the leveraged position and covenant compliance through a downturn in the cycle, notwithstanding a number of cure measures that is available to the company. The positioning of the rating in the single-B rating category and potential stabilization of the outlook will need to be supported by the demonstrated availability of shareholders support and/or accessibility of sufficient cure measures to support LBI's compliance with covenants through a downturn in the cycle, while the company is expected to continue managing its liquidity position and remain at least FCF neutral in the medium term. Should the operating performance of the company deteriorate substantially further, Moody's may review its assumptions behind the corporate family recovery rates. LBI performance in the nine months of 2008 remained behind the original expectation for the year reflecting the unprecedented volatility in the oil prices that reduced profitability in the Chemical and Fuels segments, while the refining business also experienced some operational issues. While profitability of the Chemicals segment restored following the decline in raw material prices in the third quarter, both olefins and polyolefins are enduring declining volumes as a result of a broad de-stocking in anticipation of a slowdown in demand and pending the readjustment in prices that is likely to follow the recent decline in oil prices. Consequently, LBI's cash flow generation remains behind the expectations in 2008. Moody's estimates that LBI's consolidated adjusted leverage is likely to exceed x6.5 times on LTM 2008 basis, with FFO + Interest/Interest likely below x1.5 times. In the environment of higher oil prices, LBI took proactive measures to strengthen its liquidity. The group arranged a USD 750 million unsecured revolver provided by its shareholder, and negotiated a USD 600 million extension to its asset-backed inventory facility raised against the assets of its U.S. chemicals and refinery businesses. At the end of the third quarter 2008, LBI had USD 623 million in unrestricted cash, USD 750 million available under its USD 750 million Access Revolver, USD 119 million available under its USD 1 billion senior secured revolver, and USD 84 million under its accounts receivable securitization facility and its senior secured inventory-based credit facility, after giving effect to a total minimum unused availability requirement of $100 million under the accounts receivable securitization facility and the senior secured inventory-based credit facility. These ratings are affected by this action: - B3 Corporate Family Rating at LyondellBasell Industries AF SCA; - B1 / LGD 2 (27) rating on the Senior Secured 1st lien facilities; - Caa1 / LGD 5 (73) rating on Senior Secured 2d lien facility at Lyondell Basell Finance Company; - Caa2 / LGD 5 (86) rating on Senior Secured 3d lien facility at Lyondell Basell Finance Company; - Caa2 / LGD 6 (94) rating on 2015 8.375% notes at Basell AF SCA; - Caa2 / LGD 6 (94) rating on 2027 8.1% notes at Basell Finance Company; - Caa2 / LGD 5 (86) rating on 2026 7.55% notes at Lyondell Chemical Company (Assumed by Equistar LP); - Caa2 / LGD 6 (94) rating on 2026 7.625% notes at Millennium America Inc.; - Caa2 / LGD 5 (86) rating on 2010 10.25% notes at Lyondell Chemical Worldwide, Inc.; - Caa2 / LGD 5 (86) rating on 2020 9.8% notes at Lyondell Chemical Worldwide, Inc. Following the acquisition of Lyondell in 2007, LyondellBasell became the world's largest independent producer of polypropylene and advanced polyolefins products, a leading supplier of polyethylene, and a global leader in the development and licensing of polypropylene and polyethylene processes and related catalyst sales. The group is estimated to generate 2007 revenues of USD 44 billion and EBITDA of USD 4.1 billion reflecting strong performance of Lyondell and Basell businesses at the top of the cycle. MACGREGOR DEVELOPMENT: Case Summary & 19 Largest Unsec. Creditors ----------------------------------------------------------------- Debtor: MacGregor Development Company 201 Shannon Oaks Circle, Suite 201 Cary, NC 27511 Bankruptcy Case No.: 08-08089 Type of Business: The Debtor operates a home building company. Chapter 11 Petition Date: November 14, 2008 Court: Eastern District of North Carolina (Wilson) Judge: A. Thomas Small Debtor's Counsel: Gregory B. Crampton, Esq. gcrampton@nichollscrampton.com Nicholls & Crampton, P.A. P. O. Box 18237 Raleigh, NC 27619 Tel: (919) 781-1311 Fax: (919) 782-0465 Total Assets: $23,794,523 Total Debts: $41,388,434 The Debtor's Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ BB&T guaranty of over $14,250,000 P.O. Box 27961 Jordan LLC debt Raleigh, NC 27611 SunTrust Bank guaranty of $3,412,683 700 Spring Forest Road Sheron Road Suite 125 Ventures LLC Raleigh, NC 27609 secured debt KB Homes lot purchase $1,800,190 1155 Mt. Vernon Highway agreement Suite 800 Atlanta, GA 30338 Insco Dico surety bond $460,000 Trisure Corporation insurance $21,124 Winstar Development Co. Inc. consultant $17,750 Thomass Judy & Tucker audit $15,000 Shannon Oaks Partnership office rent $10,116 Lunsford & Strickland PA legal $8,225 Alan R. Cox $5,520 GMAC lease $4,085 Metrostudy research $3,228 Actuarial Consulting Group consultant $2,853 Inc. Blue Cross Blue Shield of NC insuance $2,475 Manning Fulton legal $2,453 Lester Stancil & Associates Sorrel Pointe $1,874 Eng, Bruce Herber benefits $2,081 Mechant's Tire & Auto Centers repairs $673 The petition was signed by the company's president Michael F. Whitehead MEHDY GHARACHEHDAGHY: Case Summary & 17 Largest Unsec. Creditors ---------------------------------------------------------------- Debtor: Mehdy Gharachehdaghy aka Mike Gharach dba M & M & M Plastering Mahnaz Aalam 18747 Wells Drive Tarzana, CA 91356 Bankruptcy Case No.: 08-19090 Chapter 11 Petition Date: November 13, 2008 Court: Central District Of California (San Fernando Valley) Judge: Kathleen Thompson Debtor's Counsel: Steven M. Gluck, Esq. sgluck@juno.com 1313 Post Avenue Torrance, CA 90501 Tel: (818) 887-8205 Total Assets: $16,181,850 Total Debts: $13,686,706 The Debtor's Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ First Regional Bank bank loan; $4,264,720 1801 Century Park East collateral: Los Angeles, CA 90067 $4,000,000; unsecured: $264,720 National City Mortage bank loan; $740,000 collateral: $300,000; unsecured: $160,000 Farhad Salehsari $325,000 11300 W. Olympic Blvd., #870 Los Angeleis, CA 90064 Devries Diversified $105,000 Chase Auto bank loan $71,160 Dovecreek Wood Products Inc. $65,000 Cal Paving & Grading $65,000 Associated Ready Mix $37,145 Simon Mehrabian $35,000 GMAC bank loan; $23,075 collateral: $18,000,000; unsecured: $5,075 Phoenix Paving Co. $23,000 Full Penwelding $20,000 Michael M. Meshabi $14,500 Chase Bankcard $9,700 HSBC bank loan $1,313 Capital One bank loan $1,143 Bally Total Fitness bank loan $1,058 MERVYN'S LLC: Files Schedules of Assets and Liabilities ------------------------------------------------------- Mervyn's LLC delivered to the U.S. Bankruptcy Court for the District of Delaware its schedules of assets and liabilities, disclosing: A. Real Property Capital Lease Property $27,820,121 Capitalized Interest 1,469,472 InlandCtr 4,674,463 Newark 6,274,881 Florin 3,572,641 Conveyer 1,419,694 NDC Flow Improvement 2,187,414 M-324 San Jose, CA 4,577,991 M-323 National City, CA 5,793,093 M-031 Pleasant Hill Remodel 1,131,111 M-031 Pleasant Hill Remodel 130,006 M-326 Brownsville, TX 600,426 Drywall 764,100 Ceramic Tile 172,770 Drywall 699,520 Ceramic Tile-Installation 199,697 Carpet 104,871 LHI 739,896 LHI 130,824 Drywall 726,409 Drywall 159,702 Drywall 672,657 Drywall 295,290 2005 Application Hardware CPR 119,325 2006 Collage Frames CPR 472,914 Lightning Retroit-GE Loan 303,296 NDC Parking Lot Replacement 870,932 HVAC Units 292,773 HVAC Units 313,529 Ceramic Tile-Installation 211,362 Asphalt Paving 214,749 HVAC Units 113,772 Service Distribution 302,170 2005 Mervyn's Accessibility 185,265 NDC Flow Improvement 2,187,414 NDC Flow Improvement 412,408 Others 30,962,319 B. Personal Property B.1 Cash on hand 140 Ingram 14,700 142 South Pk 15,500 143 Santa Fe 14,700 146 San Rafael 15,500 147 Montebello 19,800 149 Odessa 14,700 150 Lubbock 14,700 153 Canoga Pk 14,700 154 Chandler 15,500 157 Midland 14,700 165 Woodland 14,700 166 Victorville 19,000 167 Mira Mesa 14,700 168 Huntington CT 14,700 183 Turlock 17,800 184 Chino 18,200 185 Valencia 16,700 189 Nellis Crsing 18,600 193 Cerritos 15,100 194 Irvine 14,700 195 Escondido 18,600 206 Eureka 14,700 214 Moreno Valley 17,400 216 Clovis 18,200 217 East Hills 16,600 219 Santa Maria 14,700 220 Boise 15,900 224 Morgan Hill 15,500 225 Sunland Park 15,100 226 El Cajon 17,400 230 Terra Vista 17,400 231 Ukiah 13,900 232 Madera 16,600 233 Ridgecrest 13,900 234 Superstition 15,900 235 Temecula 17,900 236 Burbank 17,400 248 Westchester 19,400 249 No Fullerton 14,700 250 Tulare 15,100 251 Porterville 15,100 261 Sctsdale PAV 14,700 262 Miss Ridge PL 16,300 263 Fred War Plz 14,700 264 Lompoc 14,700 265 Palmdale 15,900 266 Anaheim Hills 16,300 267 Mission Viejo 14,700 268 Vacaville Com 15,500 269 San Francisco 18,600 270 MC Allen 18,600 271 Harlingen 14,700 272 N. Star Mall 15,100 276 Livermore 15,900 277 Hanford 16,200 278 Carmel Mtn. 13,100 282 Arrowhead Mal 16,700 283 Sonora 14,700 284 Elk Grove 19,400 285 Arbor Faire 17,800 288 Chula Vista 17,800 289 Highland 15,900 290 Silver Creek 14,700 291 Foothill Ranc 14,700 292 Laguna Niguel 14,700 294 S Town Center 14,700 296 Laredo 18,200 298 Thousand Oaks 15,500 310 Henderson 17,100 313 Cottonwood 16,700 317 Lakewood 19,000 318 Reno 14,700 319 S LS VGS 15,100 320 Folsom 16,700 321 Slatten Ranch 16,700 323 Sweetwater National City 13,000 324 San Jose 15,400 325 Crossroads Twn Cntr Gilbert 15,100 326 Las Tiendas Plzabrownsville 12,300 327 Rocklin 15,500 328 Florin 19,000 329 Newark 19,000 330 Goodyear 17,500 331 Apple Valley 17,900 332 Calexico 18,600 333 South Phoenix 17,400 001 Southland 21,000 004 Prn Plz 20,200 005 Cupertno 17,500 006 Pinole 17,800 007 Dublin 18,300 008 Napa 17,400 009 Modesto 19,400 010 Petaluma 15,500 011 Antioch 15,500 013 Campbell 17,100 014 Serrmont 19,000 Others 1,305,800 B.2 Bank Accounts Wachovia Bank, NA 86,097 Bank of America 4,668,290 Bank of America 1,004,041 Bank of America 283,277 US Bank 212,144 US Bank 1,000,000 JP Morgan Chase Bank 461,592 B.3 Security Deposits Sedgwick Escrow for General Liability 100,000 Traveler's Escrow for Worker's Com-Past Years' 231,000 Traveler's Escrow for Worker's Com-losses 41,400 Utility Deposit for 1240 E Main St Arizona Store 30,500 Utility Deposit for Gas & Electric for New Store 33,890 Utility Deposit for 1869 E Camelback Rd Co Arizona 25,104 Deposit for Electric & Water Services-New Store 15,025 Others 179,689 B.13 Business Interests and stocks Mervyn's Brands, LLC 44,701,669 B.16 Accounts Receivable Visa/MC Receivable 1,540,590 Debit Card Receivable 1,978,629 GE Receivable 7,520,380 Others 3,605,119 B.18 Other Liquidated Debts Tax Refund - Texas sales tax related to June 2008 activity 197,591 Tax Refund - Texas sales tax related to July 2008 activity 256,616 B.21 Other Contingent & Unliquidated claims Mervyns Holdings, LLC et. al.v. Lubert-Adler and Klaff Partners, LP et. al. Unliquidated B.23 Licenses, franchises, and other intangibles Credit Card Program 2,783,525 B.24 Customer lists or other compilations Not Included B.25 Vehicles Sun Acquisition-trailers 141,862 Sun Acquisition-trailers 63,057 Sun Acquisition-trailers 158,899 Others 72,161 B.28 Office equipment, furnishings and supplies Livermore Concept Research & D 58,606 M-323 National City, CA 188,443 M-324 San Jose, CA 166,498 M-325 Gilbert, AZ 221,426 M-326 Brownsville, TX 252,644 Carpet Installation 76,720 Carpet Installation 77,276 Carpet 66,149 Furnitures and Equipment 35,563 Furnitures and Equipment 39,868 Others 137,691,013 B.30 Inventory Skechers Womens 12,307 Ellemenno 18,159 Mens CAS Shoes 17,458 Mens Nike Shoes 30,371 Levi 501 PS Jean 33,535 Docker Pants 35,370 Mens Hanes UW 32,277 Southpole 25,146 7 16 Market 33,856 Jansport 25,459 Playtex 25,160 Others 340,947,173 B.35 Other Personal Property Prepaid Rent 11,228,428 Other Prepaid Expense 5,809,201 Prepaid Unitary Leases 3,660,504 Prepaid Other Insurance 1,829,777 Lease Acquisition Costs Net of Accumulated Amortization 2,408,611 Others ... About Mervyn's LLC Headquartered in the San Francisco Bay Area, Mervyn's LLC -- http://www.mervyns.com/-- provides a mix of top national brands and exclusive private labels. Mervyn's has 176 locations in seven states. Mervyn's stores have an average of 80,000 retail square feet, smaller than most other mid-tier retailers and easier to shop, and are located primarily in regional malls, community shopping centers, and freestanding sites. The company and its affiliates filed for Chapter 11 protection on July 29, 2008, (Bankr. D. Del. Lead Case No.: 08-11586). Howard S. Beltzer, Esq., and Wendy S. Walker, Esq., at Morgan Lewis & Bockius LLP, and Mark D. Collins, Esq., Daniel J. DeFranceschi, Esq., Christopher M. Samis, Esq. and L. Katherine Good, Esq., at Richards Layton & Finger P.A., represent the Debtors in their restructuring efforts. Kurtzman Carson Consultants LLC is the Debtors' claims agent. The Debtors' financial advisor is Miller Buckfire & Co. LLC. Mervyn's LLC's balance sheet at Aug. 30, 2008, showed $665,493,000 in total assets and $717,160,000 in total liabilities resulting in a $51,667,000 total stockholders' deficit. (Mervyn's Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) MERVYN'S LLC: Wants to Plan Filing Period Extended Until Feb. 24 --------------------------------------------------------------- Pursuant to Section 1121(b) of the Bankruptcy Code, a debtor has the exclusive right to file a plan of reorganization for a period of 120 days after the Petition Date. If a debtor files a plan within that period, Section 1121(c)(3) provides 60 additional days during which the debtor has the exclusive right to solicit votes with respect to that plan. "The purpose of the exclusive periods is to permit debtors in possession time postpetition to stabilize their operations, formulate a reorganization plan and negotiate with creditors based on the theory that the debtor is in the best position, given its knowledge of the business and the creditor base, to propose a workable plan," Mark D. Collins, Esq., at Richards Layton & Finger PA, in Wilmington, Delaware, relates citing In re Clamp-All Corp., 233 B.R. 198, 207 (Bankr. D. Mass. 1999). Mervyn's LLC' exclusive plan filing period will expire on Nov. 26, 2008, while their exclusive solicitation period will expire on Jan. 26, 2009. The Debtors ask the U.S. Bankruptcy Court for the District of Delaware to extend their Exclusive Filing Period through and including Feb. 24, 2009, and their Exclusive Solicitation Period through and including March 26, 2009. Mr. Collins notes that the liquidation process is only just beginning. "While the Debtors have acknowledged that their estates could be administratively insolvent, [that] administrative expense shortfall is subject to various events and uncertainties, and could be narrowed or possibly eliminated depending on the course of the liquidation and the value that the Debtors are able to realize for their assets, including causes of action. Moreover, the DIP Agent has agreed to fund wind-down expenses as they come due in accordance with an agreed budget, such that, so long as receipts are in line with projections, during the period covered by the Final Store Closing Sales, the Debtors should be cash flow positive." Thus, Mr. Collins says, the Debtors are seeking an extension of their Exclusive Periods, not for purposes of delay, but rather to provide them with the necessary time and resources to liquidate their assets in an orderly, efficient and cost-effective process -- a process which all constituencies agree is best served in Chapter 11 -- and then to determine whether a liquidating plan is achievable. "The smooth liquidation of the Debtors' tangible assets during the next few months is critical to maximize value for all creditors, and could enable the Debtors to file a viable liquidating plan. Thus, it is necessary to extend the Debtors' Exclusive Periods to allow these assets sales to conclude in Chapter 11, at which point, the Debtors can further evaluate their status in consultation with the [Official Committee of Unsecured Creditors] and other constituents," Mr. Collins says. About Mervyn's LLC Headquartered in the San Francisco Bay Area, Mervyn's LLC -- http://www.mervyns.com/-- provides a mix of top national brands and exclusive private labels. Mervyn's has 176 locations in seven states. Mervyn's stores have an average of 80,000 retail square feet, smaller than most other mid-tier retailers and easier to shop, and are located primarily in regional malls, community shopping centers, and freestanding sites. The company and its affiliates filed for Chapter 11 protection on July 29, 2008, (Bankr. D. Del. Lead Case No.: 08-11586). Howard S. Beltzer, Esq., and Wendy S. Walker, Esq., at Morgan Lewis & Bockius LLP, and Mark D. Collins, Esq., Daniel J. DeFranceschi, Esq., Christopher M. Samis, Esq. and L. Katherine Good, Esq., at Richards Layton & Finger P.A., represent the Debtors in their restructuring efforts. Kurtzman Carson Consultants LLC is the Debtors' claims agent. The Debtors' financial advisor is Miller Buckfire & Co. LLC. Mervyn's LLC's balance sheet at Aug. 30, 2008, showed $665,493,000 in total assets and $717,160,000 in total liabilities resulting in a $51,667,000 total stockholders' deficit. (Mervyn's Bankruptcy News; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) MGM MIRAGE: Fitch Assigns 'BB' Rating on $750 Mil. Senior Notes --------------------------------------------------------------- Fitch Ratings has assigned a rating of 'BB' to MGM MIRAGE's (NYSE: MGM) 13% $750 million senior secured notes due 2013. MGM's 'BB-' issuer default rating, 'BB-' senior unsecured rating, and 'B' senior subordinated rating were affirmed. MGM's Rating Outlook is Negative. The $750 million issue was priced at 93.132% on Oct. 31, 2008; a discount that resulted in a 15% yield and net proceeds to MGM of $687 million, which will be used to repay a portion of MGM's $7 billion credit facility and for general corporate purposes. The transaction is expected to close on Nov. 14, 2008. Separately, in October 2008, MGM received notice of a put option from substantially all holders of Mandalay Resort Group's $150 million 7% debentures due 2036, which requires MGM to repurchase the debt on Nov. 15, 2008. Therefore, MGM's net increase in liquidity after consideration of the discount and bond repurchase is $537 million. The 'BB' senior secured note rating reflects a one-notch differential from MGM's 'BB-' IDR, which Fitch downgraded on Oct. 22, 2008. The one-notch differential incorporates the issue's first lien security interest in MGM's New York-New York property, which generated $126 million in LTM adjusted EBITDA as of Sept. 30, 2008. In addition, the secured notes will be guaranteed by all domestic subsidiaries that provide guarantees for MGM's bank facility, senior unsecured and subordinated debt. MGM's ability to access capital markets and enhance its liquidity somewhat mitigates Fitch's concern regarding debt maturities of $1.3 billion in 2009 and near-term CityCenter funding requirements. However, MGM's longer-term liquidity profile and near-term operating environment remain concerns, as indicated in 'Liquidity Focus: U.S. Gaming & Lodging', dated Oct. 23, 2008, and 'Fitch Downgrades MGM's IDR to 'BB-'; Outlook Remains Negative', dated Oct. 22, 2008. MGM reported an 18% decline in comparable property EBITDA in Q3'08, following a 12% decline in Q2'08. Fitch expects the weak operating environment in Las Vegas to continue for at least the next few quarters. The second phase of the $3 billion CityCenter financing still needs to be completed, as only $1.8 billion has been finalized to date. MGM has an additional $1.1 billion of bond maturities in 2010, prior to $532 million of bond maturities in 2011, and the October 2011 expiration of its $7 billion credit facility, of which $5.7 billion was outstanding as of Sept. 30, 2008. It is a credit positive that MGM was able to access the capital markets in this environment. However, Fitch believes the adverse terms, including the high interest cost and required collateral, indicate that MGM's access to capital on an unsecured basis remains extremely limited, if not effectively closed. MGM's credit facility permits liens on assets with a fair market value of up to 5% consolidated net tangible assets. The lien carveout was reduced to 5% from 10% as part of MGM's credit facility amendment dated Sept. 30, 2008, which provided MGM with some covenant relief, as the permitted leverage ratio was increased to 7.5 times through the end of 2009 from 6.5x. Fitch calculates MGM's consolidated net tangible assets balance as of Sept. 30, 2008 was nearly $21 billion, so it can encumber assets with a market value of roughly $1.05 billion. Therefore, MGM's ability to issue additional secured debt is limited by this issuance, the extent depending on the market value assigned to New York-New York. MGM's bonds contain a 15% consolidated net tangible asset carveout, so there could be additional secured debt capacity if terms of the credit facility were revised. MGM's $7 billion credit facility expires in October 2011. MIDORI CDO: Moody's Downgrades Ratings on Four Classes of Notes --------------------------------------------------------------- Moody's Investors Service downgraded ratings of four classes of notes issued by Midori CDO, Ltd. The notes affected by rating action are: Class Description: U.S. $6,500,000 Class A-X Secured Notes Due 2047 -- Prior Rating: B1, on review for possible downgrade -- Current Rating: Ca -- Prior Rating Action Date: Oct. 1, 2008 Class Description: U.S. $122,500,000 Class A-1 Secured Funded Notes Due 2047 -- Prior Rating: Ca -- Current Rating: C -- Prior Rating Action Date: Oct. 1, 2008 Class Description: U.S. $202,500,000 Class A-1 Secured Unfunded Notes Due 2047 -- Prior Rating: Ca -- Current Rating: C -- Prior Rating Action Date: Oct. 1, 2008 Class Description: U.S. $81,500,000 Class A-2 Secured Floating Rate Notes Due 2047 -- Prior Rating: Ca -- Current Rating: C -- Prior Rating Action Date: Oct. 1, 2008 Midori CDO is a hybrid collateralized debt obligation that references a portfolio of RMBS securities in the form of credit default swaps. The transaction experienced on Oct. 31, 2008, as reported by the Trustee on, an event of default caused when the Super Senior Overcollateralization Percentage is less than 103.5%, as described in Section 5.1(j) of the Indenture dated August 24, 2006. This event of default is still continuing. As provided in Article V of the Indenture during the occurrence and continuance of an Event of Default, certain parties to the transaction may be entitled to direct the Trustee to take particular actions with respect to the Collateral Debt Securities and the Notes. In this regard the Trustee reports it received on November 5, 2008 written direction from a majority of the Controlling Class to declare the principal of all of the Secured Notes to be immediately due and payable. Furthermore, according to the Trustee, holders of at least two-thirds of the Aggregate Principal Amount of the Controlling Class and the CDS Counterparty directed the Trustee to liquidate of the Collateral in accordance with relevant provisions of the transaction documents. The rating downgrades taken reflect the increased expected loss associated with each tranche and take into account the expected liquidation proceeds on collateral of this type. Losses are attributed to diminished credit quality on the underlying portfolio. MODERN CONTINENTAL: Will Pay $21MM in Damages From Tunnel Collapse ------------------------------------------------------------------ Modern Continental Corp. agreed to a settlement of $21 million for damages resulting from the collapse of ceiling panels in the I-90 connector tunnel on July 10, 2006, that killed Milena Del Valle, a passenger in a car driven by her husband, Jonathan Saltzman, at The Boston Globe reports, citing Attorney General Martha Coakley. The Boston Globe relates that Modern Continental earned $3.2 billion on the I-90 tunnel. Newman Associates Inc., which sold Modern Continental the epoxy that was supposed to secure the ceiling panels, also agreed to pay about $5 million in damages, The Boston Globe says, citing prosecutors. According to The Boston Globe, Leo V. Boyle, one of the lawyers who negotiated settlements of more than $28 million for Del Valle's family in a lawsuit against Modern Continental and other defendants, said that the agreed sum was substantial, considering Modern Continental's dire financial situation. Once the U.S. Bankruptcy Court for the District of Massachusetts approves the settlement, the $21 million will be taken from what the state has withheld from Modern Continental on the Big Dig tunnel construction contracts, The Boson Globe reports. Modern Continental, says the report, filed legal claims seeking $95 million for work performed, but the state -? which hasn't paid the company in about a year -- said it owes less. As part of the settlement, Modern Continental can't perform further work on its Big Dig tunnel project, The Boston Globe states. About $2 billion in performance bonds on Modern Continental's 14 remaining contracts -- mostly maintenance, repairs, and finish work -- will run for six years, and will be available to the Massachusetts Turnpike Authority to pay for costs that arise as a result of hidden defects in Modern Continental's work, according to The Boston Globe. Modern Continental said in a statement that it was "pleased to have reached this global settlement, which avoids the prospect of years of protracted litigation and believes it to be in the best interests of all of the parties and of the Commonwealth's citizens." The Boston Globe reports that the settlement also involved Modern Continental's bonding companies and resolves tens of millions of dollars in lawsuits that the company and the Turnpike Authority have filed against each other, including claims concerning the cost to repair leaks in Big Dig tunnels. Modern Continental, according to The Boston Globe, didn't admit liability for the ceiling collapse. The Boston Globe states that U.S. Attorney Michael J. Sullivan brought 49 criminal charges against Modern Continental on June 20, alleging that the firm knew that bolts were coming loose in the ceiling of the tunnel. The report says that Modern Continental, if convicted, could be fined up to $24.5 million, or $500,000 for each of the charges of: -- making false statements, -- submitting phony time and materials slips, and -- wire fraud, or $24.5 million in all. About Modern Continental Modern Continental Construction Co. -- http://www.moderncontinental.com/-- of Cambridge, Massachusetts was established in 1967 when its founders, Lelio "Les" Marino and Kenneth Anderson, earned a small contract for the construction of a sidewalk in the town of Peabody. Since then, the company has blossomed into a multi-faceted organization which is highly respected throughout the construction industry, and is ranked among the top contractors in the country. The company filed for Chapter protection on June 23, 2008 (Bankr. D. Mass. Case No. 08-14558). Harold B. Murphy, Esq., at Hanify & King P.C., represents the Debtor in its restructuring efforts. An Official Committee of Unsecured Creditors has been appointed in the Debtor's bankruptcy case. When the debtor filed for protection from its creditors, it listed assets of $100 million to $500 million, and debts of $500 million to $1 billion. MONROE CENTER: Case Summary & 19 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Monroe Center II Urban Renewal Company, LLC 720 Monroe Street, Unit C308 Hoboken, NJ 07030 Bankruptcy Case No.: 08-32556 Debtor-affiliates filing separate Chapter 11 petitions: Entity Case No. ------ -------- Monroe Center Management, LLC 08-27104 Monroe Center, LLC 08-27203 Chapter 11 Petition Date: November 14, 2008 Court: District of New Jersey (Newark) Judge: Morris Stern Debtor's Counsel: Christine M. Gravelle, Esq. cmgravelle@mgs-law.com Markowitz Gravelle, LLP 3131 Princeton Pike Lawrenceville, NJ 08648 Tel: (609) 896-2660 Estimated Assets: Less than $50,000 Estimated Debts: $10 million to $50 million The Debtor's Largest Unsecured Creditors: Entity Claim Amount ------ ------------ Montroy Anderson $197,305 99 Madison Avenue 14th Floor NY, NY 10016 Sadat Associates $172,468 1545 Lamberton Rd Trenton, NJ 08610 McManimon & Scotland LLC $114,809 1 Riverfront Plaza Newark, NJ 07102 New Jersey Dep of 89,378 MG Forge Construction 88,627 George Langer Associates 70,185 Excel Environmental 54,000 Farer Fersko 44,932 Ecol Sciences 36,655 Marketing Directors 35,000 Till Design LLC ( phase II ) 34,020 Nacamuli Associates 33,750 Herrick 19,953 Marcia Barkan Associates 18,556 I/F Tec 15,687 VJ Associates 12,500 Cahn Communications 8,320 Walker Parking 6,817 TCRM Commercial Corp Unknown The petition was signed by Dil Hoda, a member of the company. MORGAN STANLEY: Moody's Pares Rating on $14.75 Mil. Notes to Ba2 ---------------------------------------------------------------- Moody's Investors Service downgraded its rating on these notes issued by Morgan Stanley Managed ACES SPC AB SCDO 2007-20: Class Description: U.S. $14,750,000 Class I Sr A Secured Floating Rate Notes due 2017 -- Prior Rating: A3 -- Prior Rating Date: Oct. 10, 2008 -- Current Rating: Ba2 According to Moody's, the rating action is the result of deterioration in the credit quality of the transaction's reference portfolio, which includes but is not limited to exposure to Lehman Brothers Holdings Inc., which filed for protection under Chapter 11 of the U.S. Bankruptcy Code on Sept. 15, 2008, Washington Mutual Inc., which was seized by federal regulators on Sept. 25, 2008 and subsequently virtually all of its assets were sold to JPMorgan Chase, Fannie Mae and Freddie Mac, which were placed into the conservatorship of the U.S. government on Sept. 8, 2008, Landsbanki Islands hf and Glitnir Banki hf, for each of which a receivership committee was appointed on Oct. 7, 2008 and Kaupthing Bank hf, for which a receivership committee was appointed on Oct. 8, 2008. MORGAN STANLEY: Moody's Junks Ratings on $10 Mil. Notes From Ba1 ---------------------------------------------------------------- Moody's Investors Service downgraded its rating on these notes issued by Morgan Stanley Managed ACES SPC AB SCDO Series 2007-15: Class Description: U.S. $10,000,000 Class IIIA Secured Floating Rate Notes due 2017 -- Prior Rating: Ba1 -- Prior Rating Date: Oct. 10, 2008 -- Current Rating: Caa1 According to Moody's, the rating action is the result of deterioration in the credit quality of the transaction's reference portfolio, which includes but is not limited to exposure to Lehman Brothers Holdings Inc., which filed for protection under Chapter 11 of the U.S. Bankruptcy Code on Sept. 15, 2008, Washington Mutual Inc., which was seized by federal regulators on Sept. 25, 2008 and subsequently virtually all of its assets were sold to JPMorgan Chase, Fannie Mae and Freddie Mac, which were placed into the conservatorship of the U.S. government on Sept. 8, 2008, Landsbanki Islands hf and Glitnir Banki hf, for each of which a receivership committee was appointed on Oct. 7, 2008 and Kaupthing Bank hf, for which a receivership committee was appointed on Oct. 8, 2008. MORGAN STANLEY: Moody's Downgrades Ratings on Two Classes of Notes ------------------------------------------------------------------ Moody's Investors Service downgraded its ratings on these notes issued by Morgan Stanley Managed ACES SPC AB SCDO Series 2007-11: Class Description: U.S. $20,000,000 Class IA Secured Floating Rate Notes due 2017 -- Prior Rating: Baa1 -- Prior Rating Date: Oct. 10, 2008 -- Current Rating: Ba3 Class Description: U.S. $21,000,000 Class IIIA Secured Floating Rate Notes due 2017 -- Prior Rating: Ba1 -- Prior Rating Date: Oct. 10, 2008 -- Current Rating: Caa1 According to Moody's, the rating actions are the result of deterioration in the credit quality of the transaction's reference portfolio, which includes but is not limited to exposure to Lehman Brothers Holdings Inc., which filed for protection under Chapter 11 of the U.S. Bankruptcy Code on Sept. 15, 2008, Washington Mutual Inc., which was seized by federal regulators on Sept. 25, 2008 and subsequently virtually all of its assets were sold to JPMorgan Chase, Fannie Mae and Freddie Mac, which were placed into the conservatorship of the U.S. government on Sept. 8, 2008, Landsbanki Islands hf and Glitnir Banki hf, for each of which a receivership committee was appointed on Oct. 7, 2008 and Kaupthing Bank hf, for which a receivership committee was appointed on Oct. 8, 2008. MORGAN STANLEY: Moody's Downgrades Ratings on $240 Million Notes ---------------------------------------------------------------- Moody's Investors Service downgraded its rating on these notes issued by Morgan Stanley Managed ACES SPC AB SCDO 2007-13: Class Description: U.S. $240,000,000 Class I SrA Secured Floating Rate Notes due 2017 -- Prior Rating: A3 -- Prior Rating Date: Oct. 10, 2008 -- Current Rating: Ba2 According to Moody's, the rating action is the result of deterioration in the credit quality of the transaction's reference portfolio, which includes but is not limited to exposure to Lehman Brothers Holdings Inc., which filed for protection under Chapter 11 of the U.S. Bankruptcy Code on Sept. 15, 2008, Washington Mutual Inc., which was seized by federal regulators on Sept. 25, 2008 and subsequently virtually all of its assets were sold to JPMorgan Chase, Fannie Mae and Freddie Mac, which were placed into the conservatorship of the U.S. government on Sept. 8, 2008, Landsbanki Islands hf and Glitnir Banki hf, for each of which a receivership committee was appointed on Oct. 7, 2008 and Kaupthing Bank hf, for which a receivership committee was appointed on Oct. 8, 2008. MORGAN STANLEY: Moody's Downgrades Ratings on Various Note Classes ------------------------------------------------------------------ Moody's Investors Service downgraded its ratings on these notes issued by Morgan Stanley Managed ACES SPC AB SCDO Series 2007-5: Class Description: JPY 1,000,000,000 Class III SrB Secured Floating Rate Notes due 2017 -- Prior Rating: Ba1 -- Prior Rating Date: Oct. 10, 2008 -- Current Rating: Caa1 Class Description: $50,000,000 Class IIIA Secured Floating Rate Notes due 2017 -- Prior Rating: Ba1 -- Prior Rating Date: Oct. 10, 2008 -- Current Rating: Caa1 Class Description: $21,700,000 Class IIIF Secured Floating Rate Notes due 2017 -- Prior Rating: Ba1 -- Prior Rating Date: Oct. 10, 2008 -- Current Rating: Caa1 Class Description: $15,000,000 Class IIIH Secured Fixed Rate Notes due 2017 -- Prior Rating: Ba1 -- Prior Rating Date: Oct. 10, 2008 -- Current Rating: Caa1 Class Description: SGD 15,300,000 Class IIII Secured Fixed Rate Notes due 2017 -- Prior Rating: Ba1 -- Prior Rating Date: Oct. 10, 2008 -- Current Rating: Caa1 Class Description: AUD 13,000,000 Class IIIJ Secured Fixed Rate Notes due 2017 -- Prior Rating: Ba1 -- Prior Rating Date: Oct. 10, 2008 -- Current Rating: Caa1 Class Description: JPY 1,000,000,000 Class IV SrB Secured Floating Rate Notes due 2017 -- Prior Rating: Ba3 -- Prior Rating Date: Oct. 10, 2008 -- Current Rating: Caa3 Class Description: JPY 1,000,000,000 Class IV SrD Secured Floating Rate Notes due 2017 -- Prior Rating: Ba3 -- Prior Rating Date: Oct. 10, 2008 -- Current Rating: Caa3 Class Description: JPY 1,000,000,000 Class IV SrF Secured Fixed Rate Notes due 2017 -- Prior Rating: Ba3 -- Prior Rating Date: Oct. 10, 2008 -- Current Rating: Caa3 Class Description: JPY 1,000,000,000 Class V SrB Secured Floating Rate Notes due 2017 -- Prior Rating: B2 -- Prior Rating Date: Oct. 10, 2008 -- Current Rating: Ca Class Description: JPY 1,000,000,000 Class V SrC Secured Floating Rate Notes due 2017 -- Prior Rating: B2 -- Prior Rating Date: Oct. 10, 2008 -- Current Rating: Ca Class Description: $100,000,000 Class VA Secured Floating Rate Notes due 2017 -- Prior Rating: B2 -- Prior Rating Date: Oct. 10, 2008 -- Current Rating: Ca According to Moody's, the rating actions are the result of deterioration in the credit quality of the transaction's reference portfolio, which includes but is not limited to exposure to Lehman Brothers Holdings Inc., which filed for protection under Chapter 11 of the U.S. Bankruptcy Code on Sept. 15, 2008, Washington Mutual Inc., which was seized by federal regulators on Sept. 25, 2008 and subsequently virtually all of its assets were sold to JPMorgan Chase, Fannie Mae and Freddie Mac, which were placed into the conservatorship of the U.S. government on Sept. 8, 2008, Landsbanki Islands hf and Glitnir Banki hf, for each of which a receivership committee was appointed on Oct. 7, 2008 and Kaupthing Bank hf, for which a receivership committee was appointed on Oct. 8, 2008. MORGAN STANLEY: Moody's Junks Rating on $50 Million Notes --------------------------------------------------------- Moody's Investors Service downgraded its rating on these notes issued by Morgan Stanley Managed ACES SPC AB SCDO Series 2007-10: Class Description: U.S. $50,000,000 Class IIIA Secured Floating Rate Notes due 2014 -- Prior Rating: Ba2 -- Prior Rating Date: Oct. 10, 2008 -- Current Rating: Caa3 According to Moody's, the rating action is the result of deterioration in the credit quality of the transaction's reference portfolio, which includes but is not limited to exposure to Lehman Brothers Holdings Inc., which filed for protection under Chapter 11 of the U.S. Bankruptcy Code on Sept. 15, 2008, Washington Mutual Inc., which was seized by federal regulators on Sept. 25, 2008 and subsequently virtually all of its assets were sold to JPMorgan Chase, Fannie Mae and Freddie Mac, which were placed into the conservatorship of the U.S. government on Sept. 8, 2008, Landsbanki Islands hf and Glitnir Banki hf, for each of which a receivership committee was appointed on Oct. 7, 2008 and Kaupthing Bank hf, for which a receivership committee was appointed on Oct. 8, 2008. MORGAN STANLEY: Moody's Downgrades Ratings on Two Classes of Notes ------------------------------------------------------------------ Moody's Investors Service downgraded its ratings on these notes issued by Morgan Stanley Managed ACES SPC AB SCDO Series 2007-6: Class Description: JPY 100,000,000 Class I SrB Secured Fixed Rate Notes due 2014 -- Prior Rating: Baa1 -- Prior Rating Date: Oct. 10, 2008 -- Current Rating: B1 Class Description: JPY 300,000,000 Class IV SrB Secured Floating Rate Notes due 2014 -- Prior Rating: Ba3 -- Prior Rating Date: Oct. 10, 2008 -- Current Rating: Caa3 According to Moody's, the rating actions are the result of deterioration in the credit quality of the transaction's reference portfolio, which includes but is not limited to exposure to Lehman Brothers Holdings Inc., which filed for protection under Chapter 11 of the U.S. Bankruptcy Code on Sept. 15, 2008, Washington Mutual Inc., which was seized by federal regulators on Sept. 25, 2008 and subsequently virtually all of its assets were sold to JPMorgan Chase, Fannie Mae and Freddie Mac, which were placed into the conservatorship of the U.S. government on Sept. 8, 2008, Landsbanki Islands hf and Glitnir Banki hf, for each of which a receivership committee was appointed on Oct. 7, 2008 and Kaupthing Bank hf, for which a receivership committee was appointed on Oct. 8, 2008. MORGAN STANLEY: Moody's Junks Ratings on Two Classes of Notes ------------------------------------------------------------- Moody's Investors Service downgraded its ratings on these notes issued by Morgan Stanley Managed ACES SPC AB SCDO Series 2007-1: Class Description: U.S.$45,000,000 Class IA Secured Floating Rate Notes due 2014 -- Prior Rating: Baa1 -- Prior Rating Date: Oct. 10, 2008 -- Current Rating: B1 Class Description: EUR7,500,000 Class IC Secured Floating Rate Notes due 2014 -- Prior Rating: Baa1 -- Prior Rating Date: Oct. 10, 2008 -- Current Rating: B1 Class Description: U.S.$100,000,000 Class ID Secured Floating Rate Notes due 2014 -- Prior Rating: Baa1 -- Prior Rating Date: Oct. 10, 2008 -- Current Rating: B1 Class Description: U.S.$40,000,000 Class IIIA Secured Floating Rate Notes due 2014 -- Prior Rating: Ba2 -- Prior Rating Date: Oct. 10, 2008 -- Current Rating: Caa3 Class Description: U.S.$5,000,000 Class IVA Secured Floating Rate Notes due 2014 -- Prior Rating: Ba3 -- Prior Rating Date: Oct. 10, 2008 -- Current Rating: Caa3 According to Moody's, the rating actions are the result of deterioration in the credit quality of the transaction's reference portfolio, which includes but is not limited to exposure to Lehman Brothers Holdings Inc., which filed for protection under Chapter 11 of the U.S. Bankruptcy Code on Sept. 15, 2008, Washington Mutual Inc., which was seized by federal regulators on Sept. 25, 2008 and subsequently virtually all of its assets were sold to JPMorgan Chase, Fannie Mae and Freddie Mac, which were placed into the conservatorship of the U.S. government on Sept. 8, 2008, Landsbanki Islands hf and Glitnir Banki hf, for each of which a receivership committee was appointed on Oct. 7, 2008 and Kaupthing Bank hf, for which a receivership committee was appointed on Oct. 8, 2008. MORRIS PUBLISHING: S&P Downgrades Corporate Credit Rating to 'CCC' ------------------------------------------------------------------ Standard & Poor's Ratings Services lowered its corporate credit rating on Augusta, Georgia-based Morris Publishing Group LLC to 'CCC' from 'CCC+'. The rating outlook is negative. At the same time, S&P revised the recovery rating on the company's senior secured credit facilities to '2', indicating S&P's expectation for substantial (70% to 90%) recovery in the event of a payment default, from '1'. The issue-level rating on the credit facilities was lowered to 'CCC+' from 'B', reflecting the revised recovery rating and lower corporate credit rating. The issue-level rating on the company's subordinated debt was lowered to 'CC' from 'CCC-', in conjunction with the lowering of the corporate credit rating. The recovery rating on this debt remains at '6', indicating that lenders can expect negligible (0% to 10%) recovery in the event of a payment default. "The corporate credit rating downgrade reflects S&P's concern that, even with the covenant relief provided in the most recent executed amendment, the company will be unable to sustain its current capital structure over the next several quarters," said Standard & Poor's credit analyst Liz Fairbanks. The amendment stipulates that the company's parent, Morris Communications Co. LLC, must sign a letter of intent to consummate a transaction that would generate sufficient funds to prepay all loans under the credit agreement or refinance the facility. On its earnings call on Wednesday, the company gave no indication that it was negotiating the sale of any assets; S&P's ratings, therefore, do not incorporate the expectation that the company will consummate a transaction that will generate funds to repay the credit facility. S&P is concerned that the company may file for bankruptcy protection to reduce its debt outstanding. Moreover, S&P expects that the current economic environment will continue to exacerbate secular rates of ad revenue decline over the next year. S&P's ratings incorporate an expectation that revenue and EBITDA at Morris Publishing will decline in the mid- teens percentage area and by more than 30%, respectively, in 2009. S&P are concerned that EBITDA at Morris Publishing will decline to about $46 million in 2008, which would result in debt to EBITDA (both measures adjusted for operating leases) increasing to almost 10x. In a third amendment to its credit facility, lenders agreed to ease financial maintenance covenant levels until the filing date of financial statements for the quarter ending June 30, 2009, and S&P does not expect the company to be in compliance with covenants at that time. The rating on Morris Publishing is based on the consolidated credit quality of Morris Communications Co. LLC and its restricted subsidiaries, which guarantee Morris Publishing's senior secured credit facilities. (Morris Publishing's subordinated notes, however, are not guaranteed by the parent company.) Morris Publishing accounts for the majority of Morris Communications' cash flow. In addition to Morris Publishing, other restricted subsidiaries are involved in outdoor advertising and radio broadcasting, as well as magazine, book, and specialty publishing. MOTOR COACH: Wants Court to Set Jan. 7, 2009, as Claims Bar Date ---------------------------------------------------------------- Motor Coach Industries International Inc. and its debtor- affiliates ask the United States Bankruptcy Court for the District of Delaware to establish Jan. 7, 2009, as deadlines for the Debtors' creditors to file proofs of claim. The Debtors seek March 16, 2009, as deadline for governmental units. All proofs of claim must be delivered to Motor Coach claims Processing Center c/o Kurztman Carson Consultants LLC at 2335 Alaska Avenue in El Segundo, California. MPC COMPUTRES: Court Approves Logan and Company as Claims Agent --------------------------------------------------------------- The Hon. Peter J. Walsh of the United States Bankruptcy Court for the District of Delaware authorized MPC Computers LLC and its debtor-affiliates to employ Logan and Company as claims, noticing, and balloting agent. The firm will: a) prepare and serve required notices in these cases, including, without limitation notice of commencement of the cases and the initial meeting of creditors, notice of the claims bar date, notice of objections to claims, and notices of hearings on a disclosure statement or plan of reorganization; b) prepare for filing with the clerk's office an affidavit of service for notices served by the firm; c) maintain copies of all proofs of claim and proofs of interest filed in these cases; d) maintain an official claims register by docketing all proofs of claims and proofs of interest in a claims database that include the name and address of the claimant or interest holder, date the proof of claim or proof of interest was received, claim number assigned to the proof of claim or proof of interest, the amount asserted in the proof of claim or proof of interest, and the classification of the claim; e) maintain a current mailing list for all entities that have filed proofs of claim or proofs of interest; f) record all transfers of claims pursuant to Bankruptcy Rule 3001(e) and give notice of the transfers as required by Bankruptcy Rule 3001(e); g) provide balloting and solicitation services, including preparing ballots, producing personalized ballots and tabulating ballots; and h) provide other claim, noticing, and balloting services as may be requested by the Debtors or the clerk from time to time. The Debtor will pay the firm's standard prices for its services, expenses and supplies. The firm will be paid an advance payment of $5,000. To the best of the Debtors' knowledge, the firm is a "disinterested person" as defined in Section 101(14) of the Bankruptcy Code. NATIONAL WHOLESALE: To Liquidate Stores If It Fails to Find Buyer ----------------------------------------------------------------- Court documents say that National Wholesale Liquidators told its lenders that it will liquidate its stores if it doesn't find a buyer in the next two weeks. Chelsea Emery at Reuters relates that National Wholesale has been trying to find a buyer since 2006. National Wholesale cited economic slowdown and difficulty with obtaining credit as reasons for its Chapter 11 filing, Reuters relates. According to court documents, National Wholesale has received $7 million in debtor-in-possession financing from General Electric Capital Corp GEA.N and Wells Fargo Retail Finance, which will be used to pay for general operations. National Wholesale, court documents state, said that it has "agreed with the DIP lenders that they shall effectuate either a sale or liquidation of the debtors' business on or before Nov. 26, 2008." About National Wholesale West Hempstead, New York-based NWL Holdings, Inc. -- http://www.nationalwholesaleliquidators.com/-- aka National Wholesale Liquidators, is a family-owned discount retailer. The company was founded in 1984. The company has 55 stores located in New York, New Jersey, Pennsylvania, Connecticut, Maryland, Washington D.C., Delaware, Massachusetts, Virginia, Rhode Island, Michigan and Illinois. The company filed for Chapter 11 protection on Nov. 10, 2008 (Bankr. D. Delaware Case No. 08-12847). Dreier LLP assists the company in its restructuring effort. The company listed assets of $100 million to $500 million and debts of $100 million to $500 million. NORMA CDO: Fitch Downgrades & Withdraws All Classes of Notes ------------------------------------------------------------ Fitch Ratings downgrades one class and withdraws ratings on all classes of notes issued by Norma CDO I, Ltd. These rating actions are effective immediately: -- $937,528,491 class A-1 notes downgraded to 'C/DR6' from 'CCC/DR5' and withdrawn; -- $150,000,000 class A-2 notes remain at 'C/DR6' and withdrawn; -- $86,000,000 class B notes remain at 'C/DR6' and withdrawn; -- $50,000,000 class C notes remain at 'C/DR6' and withdrawn; -- $74,000,000 class D notes remain at 'C/DR6' and withdrawn; -- $63,758,133 class E notes remain at 'C/DR6' and withdrawn; -- $11,770,732 class F notes remain at 'C/DR6' and withdrawn; -- $14,713,415 class G notes remain at 'C/DR6' and withdrawn; -- $22,560,570 class H notes remain at 'C/DR6' and withdrawn. Norma triggered an event of default as a result of the class A overcollateralization ratio falling below 100% on March 10, 2008. Fitch received the Notice of Liquidation on Aug. 4, 2008 and the Notice of Status of Liquidation and Distribution on Oct. 6, 2008 stating that the liquidation of collateral was completed. The final distribution was made on Oct. 31, 2008. The proceeds from liquidation were insufficient to pay the Hedge Counterparties in full. Therefore, the rated notes did not receive any proceeds on the final distribution date. NORTEL NETWORKS: May Go Bankrupt Without Cash Injection ------------------------------------------------------- Nortel Networks Corp. may have to file for Chapter 11 protection by 2011 if it doesn't get cash injection, Vivek Shankar and John Kipphoff at Bloomberg News report, citing RBC Capital Markets. According to Bloomberg, RBC Capital analyst Mark Sue said that Nortel Networks is "overwhelmed with debt and burning cash." Mr. Sue, says the report, cut his price target on the Nortel Network stock to $0 from $1.50. Bloomberg relates that Nortel Networks has lost 95% of its market value in 2008 as clients reined in spending and switched to newer technology from Cisco Systems Inc. RBC Capital, according to the report, said that Nortel Networks might have to sell its Metro Ethernet unit, which is used to deliver Internet, TV and telephone service, at a fraction of the intended price. The report quoted Mr. Sue as saying, "Assets sales couldn't have come at a worse time. The world moved on while Nortel was stuck in restructuring mode." Nortel Networks may have $1.6 billion in cash at the end of 2009, about the amount it needs to run its business for 12 months, Bloomberg states, citing Mr. Sue. Nortel Networks, says the report, has about $1 billion in debt due in 2011. Nortel Networks said in a statement, "Cost reduction and cash preservation are priorities, both to stabilize our financial footing as well as to provide funds for growth investments." Bloomberg reports that Nortel Networks said that it will lay off about 1,300 workers. Nortel Networks' CEO Mike Zafirovski has laid off 18% of its workforce since taking over three years ago, and the company has lost about $3.66 billion so far this year, Bloomberg states. Nortel Networks could sell its Code Division Multiple Access unit, Bloomberg relates, citing Mr. Sue. Too many asset sales could conflict with Nortel Networks' debt covenants, Bloomberg reports, citing Mr. Sue. Bloomberg states that Nortel Networks is reducing its four business units to three and splitting up the services unit into groups that support companies and phone carriers. Nortel Networks expects revenue to decline 4% this year, according to the report. Bloomberg says that Nortel Networks expects to have $2.3 billion in cash at the end of 2008. The company, according to the report, owes $4.47 billion in long-term debt. Himanshu Shah -- founder and chief investment officer of Shah Capital Management, which is buying Nortel Networks shares ?- believes that Nortel Networks will be able to refinance its debt and won't go bankrupt, Bloomberg reports. About Nortel Networks Headquartered in Ontario, Canada, Nortel Networks Corporation (NYSE/TSX: NT) -- http://www.nortel.com/-- delivers next- generation technologies, for both service provider and enterprise networks, support multimedia and business-critical applications. Nortel's technologies are designed to help eliminate today's barriers to efficiency, speed and performance by simplifying networks and connecting people to the information they need, when they need it. Nortel does business in more than 150 countries around the world. Nortel Networks Limited is the principal direct operating subsidiary of Nortel Networks Corporation. * * * As reported in the Troubled Company Reporter on Sept. 25, 2008, Moody's Investors Service revised its ratings outlook for the Nortel Networks Corporation group of companies to negative from stable. The group's corporate family rating was affirmed as B3 as were the senior unsecured ratings for debt instruments issued by Nortel and its wholly-owned subsidiaries, Nortel Networks Limited and Nortel Networks Capital Corporation. NORTHLAKE FOODS: Amends List of 20 Largest Unsecured Creditors -------------------------------------------------------------- Northlake Foods, Inc. submitted to the U.S. Bankruptcy Court for the Middle District of Florida an amended list of its 20 largest unsecured creditors: Entity Claim Amount ------ ------------ Waffle House $551,579 5986 Financial Drive Norcross, GA 30071 North Star Foodservice $410,678 (PYA/Monarch/US Foods) P.O. Box 291427 Port Orange, FL 32129-1427 Blue Cross/Blue Shield $90,268 of Florida P.O. Box 105358 Atlanta, GA 30348-5358 R.C.G.I., Inc. $90,268 7950 Asheville Hwy. Spartanburg, SC 29303 Sfassie Family Ltd. $39,473 Partnership II 5395 W. Irlo Bronson Hwy. Orlando, FL 34746 Boswell Supply Limited $19,838 80 W. Wieuca Road Suite 202A Atlanta, GA 30342 Liberty Property Trust $18,294 P.O. Box 828438 hiladelphia, PA 19182-8438 Miller, South, $17,650 Milhausen & Carr, P.A. 1000 Legion Court, Suite 1200 Orlando, FL 32801 Progresss Energy $16,496 Florida, Inc. P.O. Box 33199 St. Petersburg, FL 33733-8199 Gazaway, Shirley $16,405 Waffle Properties 4920 Hyde Court Cumming, GA 30040 Sfassie Family Ltd. $15,390 Partnership III 5395 W. Irlo Bronson Hwy. Orlando, FL 34746 CNL APF Partners, LP $14,933 P.O. Box 100327 Atlanta, Ga 30384-0327 WAVANLF, LLC $14,566 1866 Vermack Court Atlanta, GA 30338 Ganaway, Nick B. $13,317 1866 Venmack Court Atlanta, GA 30338 Waffle House $12,900 5986 Financial Drive Norcross, GA 30071 WWSPNLF, LLC $12,475 1866 Vermack Court Atlanta, GA 30338 Chaistain Fields Group $12,229 P.O. Box 880908 Port St.Lucie, FL 34988-0908 Sognier L B and $11,838 Wilkiemeyer A B (Trustees) 80 W. Wieuca Road Suite 202A Atlanta, Ga 30342 NUCO2, LLC $11,457 P.O. Box 9011 Stuart, FL 34995-9011 Darling International, Inc. $11,006 P.O. Box 552210 Detroit, MI 48255-2210 Tampa, Florida-based Northlake Foods, Inc., operates a restaurant chain. The company filed for Chapter 11 relief on Sept. 15, 2008 (Bankr. M. D. Fla. Case No. 08-14131). Lori V. Vaughan, Esq., Roberta A. Colton, Esq., and Stephanie C. Lieb, Esq., at Trenam, Kemker, Scharf, Barkin, Frye, O'Neill & Millis, P.A., represent the Debtor as counsel. In its schedules, it listed total assets of $8,449,885 and total debts of $9,370,829. NR GROUP: Case Summary & 9 Largest Unsecured Creditors ------------------------------------------------------ Debtor: NR Group, LLC 701 Fourth Street Alexandria, LA 71301 Bankruptcy Case No.: 08-81329 Chapter 11 Petition Date: November 14, 2008 Court: U.S. Bankruptcy Court Western District of Louisiana (Alexandria) Judge: Henley A. Hunter Debtor's Counsel: Wade N. Kelly 1777 Ryan Street P.O. Box 2065 Lake Charles, LA 70601 (337) 433-0234 Fax : 337-433-1274 Email: wnkellylaw@yahoo.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Debtor's 9 Largest Unsecured Creditors is available for free at: http://bankrupt.com/misc/lawb08-81329.pdf PARK VIEW INN: Case Summary & 12 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Park View Inn, LLC 350 Washington Street Norwell, MA 02061 Bankruptcy Case No.: 08-18684 Chapter 11 Petition Date: November 14, 2008 Court: United States Bankruptcy Court District of Massachusetts (Boston) Judge: Joan N. Feeney Debtor's Counsel: David C. Levin Levin and Levin, LLP 875 Southern Artery Quincy, MA 02169 (617) 471-5700 Fax: (617) 770-9031 Email: dclevin@levinandlevin.com Total Assets: $900,000 Total Debts: $1,019,878 A list of Debtor's 12 largest unsecured creditors is available for free at: http://bankrupt.com/misc/mab08-18684.pdf PHILADELPHIA: Wants TARP Funds Due to Dire Fiscal Situation ----------------------------------------------------------- Kris Maher and Paulo Prada at The Wall Street Journal report that the mayors of Philadelphia, Phoenix, and Atlanta asked the Treasury Department on Friday to allocate $50 billion of the $700 billion Troubled Asset Relief Program for infrastructure investment to create jobs and lift local economies. WSJ relates that the mayors also asked for loans to cover short- term borrowing needs and to meet payroll. According to WSJ, the mayors said in a letter to Treasury Secretary Henry Paulson that the cities' dire fiscal situations would result in layoffs and tax increases. WSJ says that the cities had a remote chance to get TARP funding. Mr. Paulson said on Wednesday that the focus of TARP is "to stabilize financial institutions and strengthen the financial system," rather than to provide assistance to state and local governments, according to the report. WSJ states that Philadelphia Mayor Michael Nutter is leading the campaign for federal aid and said that the mayors are targeting TARP because the Congress already approved the program. Many mayors are hoping that the Congress will take some action soon on a "stimulus package" that would include aid to cities, WSJ relates, citing Tom Cochran, the U.S. Conference of Mayors chief. WSJ reports that Philadelphia has a $4 billion budget for next year, faces a $108 million shortfall -- almost half from slower business activity and a decline in sales taxes, and the rest from lower real-estate-transfer and wage taxes. The report quoted the city's budget director Stephen Agostini as saying, "Our revenues have fallen off the table." The report says that Philadelphia's $4 billion pension plan covers 33,000 retirees and had losses of more than $600 million through September 2008. Mayor Shirley Franklin of Atlanta, according to WSJ, told city workers that an expected shortfall of $60 million this year would result in a hiring freeze and a 10% cut in wages and work hours of municipal workers from December 2008 to June 2009. The city already laid off about 350 employees earlier this year, the report states. According to WSJ, Phoenix Mayor Phil Gordon said that his city is facing a $250 million shortfall in its yearly general-fund budget of $1.5 billion. WSJ states that about 60% of the city's budget comes from sales-tax revenue. Phoenix has $250 million of federally approved capital projects, like runway work at the airport and local mass-transit projects, which the city government could have already started if the money were available, the report says, citing Mayor Gordon. PHOENIX: Wants TARP Funds Due to Dire Fiscal Situation ------------------------------------------------------ Kris Maher and Paulo Prada at The Wall Street Journal report that the mayors of Philadelphia, Phoenix, and Atlanta asked the Treasury Department on Friday to allocate $50 billion of the $700 billion Troubled Asset Relief Program for infrastructure investment to create jobs and lift local economies. WSJ relates that the mayors also asked for loans to cover short- term borrowing needs and to meet payroll. According to WSJ, the mayors said in a letter to Treasury Secretary Henry Paulson that the cities' dire fiscal situations would result in layoffs and tax increases. WSJ says that the cities had a remote chance to get TARP funding. Mr. Paulson said on Wednesday that the focus of TARP is "to stabilize financial institutions and strengthen the financial system," rather than to provide assistance to state and local governments, according to the report. WSJ states that Philadelphia Mayor Michael Nutter is leading the campaign for federal aid and said that the mayors are targeting TARP because the Congress already approved the program. Many mayors are hoping that the Congress will take some action soon on a "stimulus package" that would include aid to cities, WSJ relates, citing Tom Cochran, the U.S. Conference of Mayors chief. WSJ reports that Philadelphia has a $4 billion budget for next year, faces a $108 million shortfall -- almost half from slower business activity and a decline in sales taxes, and the rest from lower real-estate-transfer and wage taxes. The report quoted the city's budget director Stephen Agostini as saying, "Our revenues have fallen off the table." The report says that Philadelphia's $4 billion pension plan covers 33,000 retirees and had losses of more than $600 million through September 2008. Mayor Shirley Franklin of Atlanta, according to WSJ, told city workers that an expected shortfall of $60 million this year would result in a hiring freeze and a 10% cut in wages and work hours of municipal workers from December 2008 to June 2009. The city already laid off about 350 employees earlier this year, the report states. According to WSJ, Phoenix Mayor Phil Gordon said that his city is facing a $250 million shortfall in its yearly general-fund budget of $1.5 billion. WSJ states that about 60% of the city's budget comes from sales-tax revenue. Phoenix has $250 million of federally approved capital projects, like runway work at the airport and local mass-transit projects, which the city government could have already started if the money were available, the report says, citing Mayor Gordon. POMARE LTD: May Employ Wagner Choi as Bankruptcy Counsel -------------------------------------------------------- The U.S. Bankruptcy Court for the District of Hawaii granted Pomare, Ltd. permission to employ Wagner Choi & Verburgge as its bankruptcy counsel, effective as of Oct. 2, 2008. As the Debtor's bankruptcy counsel, Wagner Choi is expected to: a) advise the Debtor with respect to the requirements and provisions of the Bankruptcy Code, the Federal Rules of Bankruptcy Procedure, Local Bankruptcy Rules, United States Trustee Guidelines and any other bankruptcy-related law, rules, United States Trustee Guidelines and any other bankruptcy-related laws, rules or regulations which may affect the Debtor; b) assist the Debtor in an analysis of bankruptcy-related options and preparation of a disclosure statement and formulation of a Chapter 11 plan of reorganization; c) advise the Debtor concerning the rights and remedies of the estate and of the Debtor in regard to adversary proceedings which may be removed to, or initiated in, the Bankruptcy Court, and d) represent the Debtor in any proceeding or hearing in the Bankruptcy Court in any action where the rights of the estate Debtor may be litigated, or affected. James A. Wagner, a partner at Wagner Choi, assured the Court that the firm does not have any interest materially adverse to the Debtor or its estate. To the best of the Debtor's knowledge, the firm qualifies as a "disinterested person" as that term is defined in Sec. 101(14) of the Bankruptcy Code. As compensation for their services, Wagner Choi's professionals currently bill: Professional Hourly Rate ----------- ----------- James A. Wagner, Esq. $425 Chuck C. Choi, Esq. $300 Neil J. Verbrugge, Esq. $220 Paralegals $75 Based in Honolulu, Hawaii, Pomare Ltd. dba. Hilo Hattie, makes and sells men's clothing. The company filed for Chapter 11 relief on Oct. 2, 2008 (Bankr. D. Hawaii Case No. 08-01448). Alexis M. McGinness, Esq., and Ted N. Pettit, Esq. represent The Official Committee of Unsecured Creditors as counsel. In its schedules, the Debtor listed total assets of $15,825,657, and total debts of $13,767,047. POMARE LTD: Obtains Final Approval to Use Cash Collateral --------------------------------------------------------- The U.S. Bankruptcy Court for the District of Hawaii granted, on a permanent basis, Pomare, Ltd.'s request for authority to use Cash Collateral held by Tori Richards, Ltd., Iolani Sportswear, Inc., and DBI Hawaii, Ltd. (collectively, "Purchase Money Secured Creditors") through and including July 31, 2009, to pay reasonable and ordinary operating expenses, in accordance with a revised budget. The Court also allowed the Debtor to exceed any particular line item in the budget by 15%. Tori Richards, Ltd. holds a Purchase Money Security Interest in Hilo Hattie inventory comprised of: women's and men's apparel bearing the Tori Richards, kahala, Nani, Pau Hana, and Hilo Hattie marks manufactured by Tori Richards. The book vlaue of the Tori Richards collateral as of the Petition Date is approximately $261,000. DBI-Hawaii, Ltd. holds a Purchase Money Security Interest in Hilo Hattie inventory comprised of: home products (pillows, shams, quilts, bedspreads, etc.) bearing the DBI-Hawaii, Kenue quilts, Mustard Seed Moments, and other marks manufactured by DBI-Hawaii, with a book value of $55,600. Iolani Sportswear, Ltd. asserts an interest in Hilo Hattie inventory comprised of: women's and men's apparel bering the Iolani Sportswear, Ltd. and Hilo Hattie marks manufactured by Iolani Sportswear, Ltd, with a book value as of the Petition Date of approximately $29,500. As adequate protection for the Debtor's use of the Purchase Money Secured Creditors' Cash Collateral, the Purchase Money Secured Creditors are granted replacement liens having the same validity, priority and extent as the respective Purchase Money Secured Creditors' existing security interests in the Cash Collateral in the Debtor's post-petition cash on hand, receivables and inventory, together with other newly acquired assets of the Debtor, with the same priority and extent as their existing security interests in the Cash Collateral. The amount secured by each Purchase Money Secured Creditor's Replacement Lien shall be equal to any actual net diminution of the Purchase Money Secured Creditors' interest, existing as of the petition date, in the Debtor's assets, due to the Debtor's actual use thereof. With regard to post-petition deliveries of goods by the Purchase Money Secured Creditors to the Debtor, the Purchase Money Secured Creditors are granted post-petition purchase money security interests in their respective Post-petiton Collateral, including all proceeds thereof, to secure the Debtor's payment for the Post- petition Collateral. This security interest shall be senior to the Post-petition liens granted to North Tustin Partners, Inc. Based in Honolulu, Hawaii, Pomare Ltd. dba. Hilo Hattie, makes and sells men's clothing. The company filed for Chapter 11 relief on Oct. 2, 2008 (Bankr. D. Hawaii Case No. 08-01448). Chuck C. Choi, Esq., at Wagner Choi & Evers, and James A. Wagner, Esq., at Wagner Choi & Verbrugge, represent the Debtor as counsel. Alexis M. McGinness, Esq., and Ted N. Pettit, Esq. represent The Official Committee of Unsecured Creditors as counsel. In its schedules, the Debtor listed total assets of $15,825,657, and total debts of $13,767,047. POMARE LTD: Panel May Employ Thomas T. Ueno as Financial Advisor ---------------------------------------------------------------- The Official Committee of Unsecured Creditors appointed in Pomare, Ltd.'s bankruptcy case asks the U.S. Bankruptcy Court for the District of Hawaii for permission to employ Thomas T. Ueno, CPA, as financial advisor for the Committee. As the Creditors Committee's financial advisor, Mr. Ueno will provide the following accounting and consulting services: a) analysis of the Debtor's finances, including review and analysis of the Debtor's financial statements: b) analysis of cash flow projections and review of monthly operating reports; c) analysis of the proposed business plan that includes assumption of the Royal Hawaiian Shopping Center lease, including analysis of the projections and construction costs; and d) analysis of financial consequences associated with operating decisions. Mr. Ueno and his employees presently bill: Hourly Rate ----------- Thomas T. Ueno $315 Carole Ueno $245 Garret Hoe $225 Yoshiro Mishina $205 Mr. Ueno assured the Court that he neither holds nor represents any interest materially adverse to these proceedings and that he is a "disinterested person" as that term is defined in Sec. 101(14) of the Bankruptcy Code. Based in Honolulu, Hawaii, Pomare Ltd. dba. Hilo Hattie, makes and sells men's clothing. The company filed for Chapter 11 relief on Oct. 2, 2008 (Bankr. D. Hawaii Case No. 08-01448). Chuck C. Choi, Esq., at Wagner Choi & Evers, and James A. Wagner, Esq., at Wagner Choi & Verbrugge, represent the Debtor as counsel. Alexis M. McGinness, Esq., and Ted N. Pettit, Esq. represent The Official Committee of Unsecured Creditors as counsel. In its schedules, the Debtor listed total assets of $15,825,657, and total debts of $13,767,047. POMARE LTD: Panel May Employ Case Lombardi as Bankruptcy Counsel ---------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Hawaii granted the Official Committee of Unsecured Creditors appointed in Pomare, Ltd.'s bankruptcy case authority to retain Case Lombardi & Pettit as its counsel, effective as of Oct. 29, 2008. As the Creditors Committee's bankruptcy counsel, Case Lombardi is expected to: a) advise the Committee as to its rights and duties; b) investigate the actions of the Debtor and assets and liabilities of the estate; c) advise the Committee in connection with negotiations and formulation of a plan of reorganization; d) consult with the Debtor concerning administration of the case; and e) perform such services as are in the interest of unsecured creditors. Compensation and reimbursement for expenses are subject to further court approval under Sec. 330 of the Bankruptcy Code and applicable local rules and guidelines. Ted N. Pettit, Esq., an attorney at Case Lombardi, assured the Court that the firm represents no interest adverse to the Committee, the Debtor or the Debtor's estate in the matters upon which it is to be engaged and that the employment of the firm is in the best interests of the estate. Based in Honolulu, Hawaii, Pomare Ltd. dba. Hilo Hattie, makes and sells men's clothing. The company filed for Chapter 11 relief on Oct. 2, 2008 (Bankr. D. Hawaii Case No. 08-01448). Chuck C. Choi, Esq., at Wagner Choi & Evers, and James A. Wagner, Esq., at Wagner Choi & Verbrugge, represent the Debtor as counsel. In its schedules, the Debtor listed total assets of $15,825,657, and total debts of $13,767,047. POMARE LTD: Taps McCorriston Miller as Special Corporate Counsel ---------------------------------------------------------------- Pomare, Ltd. asks the U.S. Bankruptcy Court for the District of Hawaii for authority to employ McCorriston Miller Mukai MacKinnon, as special corporate counsel, nunc pro tunc to Oct. 2, 2008. The Debtor wishes to retain the McCorriston Firm as special corporate counsel for general corporate matters, contracts, leases, and such other additional corporate and transactional matters as designated by the Debtor. Nancy Grekin, Esq., a partner at the McCorriston Firm, assures the Court that the firm does not hold or represent any interest adverse to the Debtor with respect to the matters for which the firm is to be employed. The McCorriston Firm will apply for compensation for services performed for, and reimbursement of expenses incurred by the firm on behalf of the Debtor in accordance with the provisions of the Bankrupcy Code and will accept such compensation and reimbursement of expenses as the Court allows. Based in Honolulu, Hawaii, Pomare Ltd. dba. Hilo Hattie, makes and sells men's clothing. The company filed for Chapter 11 relief on Oct. 2, 2008 (Bankr. D. Hawaii Case No. 08-01448). Chuck C. Choi, Esq., at Wagner Choi & Evers, and James A. Wagner, Esq., at Wagner Choi & Verbrugge, represent the Debtor as counsel. In its schedules, the Debtor listed total assets of $15,825,657, and total debts of $13,767,047. RADIO ONE: Moody's Downgrades Corporate Family Rating to 'B3' ------------------------------------------------------------- Moody's Investors Service downgraded Radio One, Inc.'s Corporate Family Rating to B3 from B2 and its Probability of Default rating to Caa1 from B2. In addition, Moody's confirmed the Ba3 rating on the company's senior secured bank credit facilities and downgraded its senior subordinated notes to Caa2 from Caa1. The rating outlook is negative. This concludes Moody's review initiated on Nov. 3, 2008. The rating downgrades reflect Moody's concerns regarding continued softness in the company's operating performance and Moody's belief that Radio One's revenue, cash flow and credit metrics will likely deteriorate in the face of a further slowdown in the economy. Moody's expects radio broadcast revenues, which are highly reliant on cyclical advertising, to come under increasing pressure due to the slowdown in consumer spending, its impact on corporate profits, and the resulting cutbacks in advertising and marketing budgets by several industries. Moody's believes that Radio One's revenue and cash flow could deteriorate such that debt-to-EBITDA leverage exceeds 9.0x over the next 12-to-18 months. The negative outlook reflects Moody's concerns regarding the company's ability to remain in compliance with its financial maintenance covenants over the next twelve months, especially after the total leverage covenant steps down to 7.25x from 7.50x in Q4 2008. While Moody's expect the company to generate positive free cash flow, that ability remains susceptible to likely increased pricing should the company require a covenant waiver and/or amendment. Moody's has taken these rating actions: Radio One, Inc. -- Corporate Family Rating: downgraded to B3 from B2 -- Probability-of-default rating: downgraded to Caa1 from B2 -- $500 million Secured revolver: confirmed Ba3 (to LGD 2, 13% from LGD 2, 24%) -- $300 million Secured term loan: confirmed Ba3 (to LGD 2, 13% from LGD 2, 24%) -- $200 million 6 3/8% senior subordinated notes: downgraded to Caa2 (LGD 4, 63%) from Caa1 (LGD 5, 80%) -- $300 million 8 7/8% senior subordinated notes: downgraded to Caa2 (LGD 4, 63%) from Caa1 (LGD 5, 80%) -- Outlook: Revised to Negative from Under Review for Possible Downgrade Radio One, Inc.'s rating reflects significant financial leverage and Moody's expectation that the company will be challenged in its ability to remain in compliance with its financial maintenance covenants as continued weakness in the U.S. economy negatively affects cash flow. In addition, the rating incorporates Radio One's soft operating performance in several of its largest markets and Moody's expectation that debt-to-EBITDA leverage will increase above 9.0x over the next 12-to-18 months (incorporating Moody's standard adjustments) as margins and free cash flow continue to come under increasing pressure. The rating is supported, nonetheless, by the company's diverse geographic presence (albeit tempered by concentration of 50% of revenues in four of its markets), its complementary properties targeting the African-American audience and meaningful proportion of local advertising revenue. Radio One, Inc., headquartered in Lanham, Maryland is a radio broadcaster that primarily targets African-American and urban listeners. The company owns 52 radio stations located in 16 urban markets in the U.S. Radio One also owns a publishing business, interests in a cable/satellite network, REACH Media and Community Connect Inc., an online social networking company. The company generated revenues of approximately $317 million (pro forma for the sale of KRBV-FM in Los Angeles) for the trailing twelve months ended Sept. 30, 2008. SCARLET HOTELS: Case Summary & 16 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Scarlet Hotels, LLC 2227 Old Fort Parkway Murfreesboro, TN 37129 Bankruptcy Case No.: 08-10704 Chapter 11 Petition Date: November 14, 2008 Court: U.S. Bankruptcy Court Middle District of Tennessee (Nashville) Debtor's Counsel: BRUCE C BAILEY CHAMBLISS BAHNER & STOPHEL PC TWO UNION SQ STE 1000 CHATTANOOGA, TN 37402-2500 423 757-0209 Fax: 423 265-9574 Email: bbailey@cbslawfirm.com Total Assets: $9,052,500 Total Debts: $4,814,061 A list of Debtor's 16 largest unsecured creditors is available for free at: http://bankrupt.com/misc/tnmb08-10704.pdf REALOGY CORP: S&P Cuts Ratings to 'CC' on $500 Mil. Note Offering ----------------------------------------------------------------- Standard & Poor's Ratings Services lowered its corporate credit rating on Realogy Corp. to 'CC' from 'CCC'. In addition, S&P lowered the rating on the company's 10.5% senior notes due 2014, senior toggle notes due 2014, and 12.375% subordinated notes due 2015 to 'C' from 'CC'. All ratings were placed on CreditWatch with negative implications. These actions follow the company's announcement that it would offer to exchange up to $500 million of new second-lien incremental term loans potentially for a portion of each series of notes. Realogy is offering to exchange term loans that represent up to 50% of par for the 10.5% notes, up to 47% of par for the senior toggle notes, and up to 36% of par for the 12.375% subordinated notes. As a result, and given S&P's previously stated view that Realogy's ability to service its current capital structure over the intermediate term will be challenged, S&P views the exchanges as being tantamount to default given the distressed financial condition of the company. Upon consummation of the transactions, S&P would lower the notes ratings to 'D' and the corporate credit rating to 'SD' for selective default. In the event the senior toggle notes holders do not participate in the exchange, given the acceptance priority favors participation by the 10.5% senior notes and 12.375% subordinated notes holders, S&P would not lower the toggle notes rating to 'D' following the close of the exchanges. As soon as is practical thereafter, S&P will reassess Realogy's capital structure and assign new ratings based on the amount of notes successfully tendered. "It is S&P's preliminary expectation that Realogy's corporate credit rating would be at best 'CCC' following the consummation of the exchange transactions, as maximum cash interest savings due to the exchanges would not meaningfully increase Realogy's ability to service its revised capital structure over the intermediate term," said Standard & Poor's credit analyst Emile Courtney. "We expect that the issue rating on the company's existing first-lien senior secured credit facility will remain at 'CCC+' (one notch above the expected corporate credit rating following the completion of the exchanges). This rating was placed on CreditWatch because S&P could lower it further if the exchange offers are not completed." In addition, S&P assigned its 'CC' rating (two notches below the expected 'CCC' corporate credit rating) to Realogy's proposed $500 million incremental second-lien senior secured term loan facility. This rating was also placed on CreditWatch with negative implications because it could be lowered if the exchange offers are not completed. S&P also assigned the facility a recovery rating of '6', indicating the expectation for negligible (0% to 10%) recovery in the event of a payment default. SEAHAWK PROPERTIES: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: Seahawk Properties, LLC P.O. Box 12350 Wilmington, NC 28405-0110 Bankruptcy Case No.: 08-07940 Chapter 11 Petition Date: November 10, 2008 Court: Eastern District of North Carolina (Wilson) Judge: J. Rich Leonard Debtor's Counsel: Larry E. Norman, Esq Lynn@normanandgardner.com Norman & Gardner P. O. Box 566 Louisburg, NC 27549 Tel: (919) 496-6003 Fax: (919) 496-4270 Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $500,001 to $$1,000,000 A copy of the Debtor's list of largest unsecured creditors is available for free at http://bankrupt.com/misc/nceb08-07940.pdf The Debtor's petition was signed by AllenGardner, Jr. at Norman and Gardner. SIMMONS COMPANY: Talks on Forbearance Prompts S&P's Junk Ratings ---------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on Atlanta, Ga.-based Simmons Company, including its corporate credit rating, to 'CCC' from 'B-'. At the same time, S&P revised the CreditWatch listing to developing from negative. S&P originally placed the company's ratings on CreditWatch with negative implications on Aug. 12, 2008, following the company's drawdown of its revolving credit facility after the end of the second quarter, and subsequently lowered the rating to 'B-' from 'B' on Oct. 22, 2008. As of Sept. 27, 2008, Simmons had close to $1.3 billion in total debt, including debt at its holding company, Simmons Super Holding Co. The downgrade follows Simmons' announcement that it is currently in discussions with its senior lenders with respect to a forbearance agreement related to its senior credit facility. The company is seeking the forbearance agreement to have more time to negotiate an amendment to relax its financial covenants into 2010. The company also announced that it will be delaying its earnings release for the third quarter ended Sept. 27, 2008, pending resolution of the amendment process. "Although Simmons currently has adequate cash on its balance sheet, and interest payments on its subordinated notes are not due until Jan. 15, 2009, S&P is concerned about the difficult operating environment that Simmons faces, as well as its ability to obtain a waiver and bank amendment in a timely manner," noted Standard & Poor's credit analyst Rick Joy. If Simmons cannot secure a covenant amendment and waiver in the forbearance period, S&P could consider lowering the ratings further. "If the company successfully negotiates a waiver and amendment and restores adequate liquidity and cushion on its financial covenants, S&P would remove the ratings from CreditWatch and review the ratings for an upgrade," he continued. SITE & PIPE: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Site & Pipe, LLC aka Site & Pipe aka Site & Pipe, Inc. 6825 E. 34th Street Indianapolis, IN 46226 County: Marion Bankruptcy Case No.: 08-14302 Chapter 11 Petition Date: November 14, 2008 Court: U.S. Bankruptcy Court Southern District of Indiana (Indianapolis) Judge: Basil H. Lorch III Debtor's Counsel: Jeffrey M. Hester Tucker Hester, LLC 429 N Pennsylvania St Ste 100 Indianapolis, IN 46204-1816 317-833-3030 Fax: 317-833-3031 Email: jeff@tucker-hester.com Total Assets: $4,358,846 Total Debts: $3,547,805 A list of the Debtor's 20 largest unsecured creditors is available for free at: http://bankrupt.com/misc/insb08-14302.pdf SOLOMONS HOMES: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Solomons Homes and Marina, LLC Suite 314, 14405 Laurel Place Laurel, MD 20707 Bankruptcy Case No.: 08-24797 Chapter 11 Petition Date: November 11, 2008 Court: District of Maryland (Greenbelt) Debtor's Counsel: Janet M. Nesse, Esq. jnesse@stinson.com Stinson Morrison Hecker LLP 1150 18th Street, NW, Suite 800 Washington, DC 20036 Tel: (202) 785-9100 Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A copy of the Debtor's list of unsecured creditors is available for free at http://bankrupt.com/misc/mdb08-24797.pdf The Debtor's petition was signed by J. Hutchins Haese, Manager/ CFO. SPANKEY'S AUTO: Voluntary Chapter 11 Case Summary ------------------------------------------------- Debtor: Spankey's Auto Sales, Inc. 701 E. Locust Street Mechanicsburg, PA 17055 Bankruptcy Case No.: 08-04267 Chapter 11 Petition Date: November 14, 2008 Court: U.S. Bankruptcy Court Middle District of Pennsylvania (Harrisburg) Judge: Mary D. France Debtor's Counsel: Robert E Chernicoff Cunningham and Chernicoff PC 2320 North Second Street Harrisburg, PA 17110 717 238-6570 Fax: 717 238-4809 Email: rec@cclawpc.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its 20 largest unsecured creditors when it filed its petition. SPARKS REGIONAL: Moody's Slashes Ratings to 'B2' on Cash Decline ---------------------------------------------------------------- Moody's Investors Service has downgraded Sparks Regional Medical Center's bond rating to B2 from Baa3. The bonds are issued by the Sebastian Cnty Pub. Health Fac. Brd., AR. The multi-notch downgrade is attributable to a significant decline in SRMC's unrestricted cash position following wider than expected losses in fiscal year 2008. At this time Moody's are renewing Moody's Watchlist for possible downgrade. Moody's review will focus on actions management has taken in recent months to improve financial performance, cash flow, and to strengthen the balance sheet. Additionally, Moody's believes there is a significant chance that SRMC's cash position could decline further over the coming months. Moody's expect to conclude Moody's review within 90 days. Legal Security: The bonds are secured by a lien on the hospital and a gross revenue pledge of SRMC and are further secured by a joint and several guaranty of the Sparks Health System and Sparks Medical Foundation (an affiliated physician organization). Interest Rate Derivatives: None Strengths * Management has implemented several operational and financial changes that are expected to improve operating income by as much as $10 million in FY 2009. Changes include: 1) opening of an inpatient rehabilitation unit, 2) reduction of physician salaries and transformation of employed physicians to Provider Based Clinic model, and 3) qualifying for the 340B drug purchase program for FY 2009. * Obligated group does not include Sparks Medical Foundation (employed physicians) which accounted for approximately $12 million of the $16 million consolidated loss in FY 2008. Due to the exclusion of the Sparks Medical Foundation from the obligated group, management believes it is probable that SRMC met its rate covenant of 1.2 times coverage. * SRMC will curtail capital expenditures significantly in FY 2009 to conserve cash. * Fully funded debt service reserve fund. Challenges * Significant reduction in unrestricted cash to a current balance of $9.6 million (as of November 12, 2008), from a much stronger $50.0 million at FYE 2007. The current level of cash translates into a weak 14 days cash on hand and provides very thin 15% coverage of debt. The decline in cash is due to material operating losses in FY 2008 accompanied by high capital expenditures, and a billing system conversion that has tied up an additional $4.2 million in accounts receivable. * Sizeable operating lease commitments of nearly $5 million annually (for medical office buildings, improvements to SRMC's information system, and other technological equipment for service improvement). Conversion of operating lease commitments to debt equivalents stresses debt measures further. * Significant and continued decline in surgical volumes during FY 2008 as competition from a physician owned ambulatory surgery center continues to take volume away from Sparks. * Challenging operating results in recent years, including negative cash flow generation in FY 2008 (-0.5% operating cash flow margin). * The majority of SRMC's medical staff is employed and is comprised of physician practices purchased from Phycor 10 years ago. Although the physicians are employed by SRMC, the medical departments have not traditionally operated as an integrated health system, which has over time, contributed to significant volume declines (in FY 1998 the hospital admitted 17,195 patients, in FY 2008 only 12,776). SRMC has implemented management and compensation changes to improve the operational and financial performance of the Medical Foundation. The financial changes (including the establishment of Provider Based Clinics and a reduction in physician compensation) relate directly to reimbursement and expense and can reasonably be expected to improve operating results in FY 2009, if there is not further volume decline. Other changes relating to management and culture of the Medical Foundation will take some time before they are effective and may not reverse the volume declines that are at the heart of SRMC's current challenges. Recent Developments and Results FY 2008 was a challenging year as volume declines severely affected profitability leading to a consolidated unaudited loss of $16.0 million (-6.6% operating margin). Losses were most pronounced at Sparks Medical Foundation (which employ's the hospital's physicians and has since been renamed Sparks Clinic), which accounted for $12.5 million of the loss. Operating losses at the hospital were largely due to surgical volume that was significantly below budget while losses at the Medical Foundation grew as a result of compensation structures that were not completely tied to productivity. Although inpatient admissions were flat, outpatient surgeries declined 29.1% to 7,993 as a physician owned ambulatory surgery center continues to draw volume from the hospital. Additional surgeries were lost due to physician departures. Consolidated operating performance was significantly off budget, which had called for an operating loss of $6.5 million. Management has taken several steps to enhance SRMC's financial performance. The hospital has qualified for the 340B drug purchase program, reorganized the structure of some employed physicians by appointing new directors and organizing them as Provider Based Clinics (essentially hospital departments) thereby allowing them to qualify for higher reimbursement, reduced physician expense through a salary reduction while remaining competitive in the market, and opened a new inpatient rehabilitation unit. Management believes these changes could improve operating income by as much as $10 million in FY 2009, although SRMC is still budgeting for a consolidated loss of $3.5 million. These projections reflect improved reimbursement from the Provider Based Clinics and other initiatives. The decline in cash over the past year is a material credit concern. The decline was largely the result of significant operating losses, capital spending at levels above depreciation expense, and the build up of accounts receivable following the conversion of the hospital's billing system and opening of the aforementioned inpatient rehabilitation unit. Cash currently totals $16.8 million, although $7.8 million of that is held at the Sparks Foundation (a subsidiary of SRMC) and is restricted. Management reports that it can access Foundation cash if necessary, but Moody's have not included it in Moody's analysis. In FY 2008, SRMC also opened the Renaissance building, an outpatient center that includes a new emergency department sized for significantly greater visits and shelled space for future expansion of operating rooms. This project began in 2006 and was funded through bond funds and fundraising. Over the near term SRMC must work to preserve cash. Volumes in December and early January are typically slow as patients and physicians take vacations. Management believes unrestricted cash (excluding the Foundation funds) could decline to as low as $2-3 million over this period before the operational changes described above generate sufficient cash flow to replenish reserves. At current levels, unrestricted cash provides thin coverage at 14 days cash on hand and only 15% cash-to-debt; at FYE 2007 these levels were 78 days cash on hand and 74% cash-to-debt. Moody's will monitor SRMC's cash position closely in the coming months. Outlook The rating is on Watchlist for possible downgrade. During the Watchlist period Moody's will review management's success in implementing its turnaround plans and monitor the balance of cash. The rating could be downgraded further if SRMC is unable to generate additional cash flow following its operational changes. What could change the rating--UP Rebuild of unrestricted cash and investment balances; growth in surgeries and admissions driving an increase in revenue What could change the rating--DOWN Further deterioration of cash balances; further decline in surgeries or admissions; inability to generate higher cash flow from operational changes; loss of physicians Key Indicators Assumptions & Adjustments: -- Based on financial statements for Sparks Health System -- First number reflects audit year June 30, 2007 -- Second number reflects un-audited year ended June 30, 2008 -- Investment returns normalized at 6% unless otherwise noted * Inpatient admissions: 12,774; 12,776 * Total operating revenues: $234.3 million; $244.0 million * Moody's-adjusted net revenue available for debt service: $5.0 million; ($0.4) million * Total debt outstanding: $67.7 million; $65.0 million * Maximum annual debt service (MADS): $6.3 million; $6.3 million * MADS Coverage with reported investment income: 0.8 times; (0.2) times * Moody's-adjusted MADS Coverage with normalized investment income: 0.8 times; (0.1) times * Debt-to-cash flow: 24.2 times; (25.5) times * Days cash on hand: 78 days; 37 days * Cash-to-debt: 74%; 38% * Operating margin: (5.2%); (6.6%) * Operating cash flow margin: (0.6%); (0.5%) Rated Debt (debt outstanding as of June 30, 2008) -- Series 2001A; fixed rate ($55.8 million outstanding) rated B2 STEPHEN HUEFFED: Case Summary & 18 Largest Unsecured Creditors -------------------------------------------------------------- Debtors: Stephen J. Hueffed dba La Ferme de Metras, LLC Amy D. Turnbull dba Amy D. Hueffed POB 274 Doty, WA 98539 Bankruptcy Case No.: 08-46005 Chapter 11 Petition Date: November 14, 2008 Court: U.S. Bankruptcy Court Western District of Washington (Tacoma) Judge: Paul B. Snyder Debtor's Counsel: Shelly Crocker Crocker Kuno LLC 720 Olive Wy Ste 1000 Seattle, WA 98101 206-624-9894 Email: scrocker@crockerkuno.com Total Assets: $2,899,346 Total Debts: $2,743,064 A list of the Debtors' 18 largest unsecured creditors is available for free at: http://bankrupt.com/misc/wawb08-46005.pdf STRUCTURED ASSET: Moody's Downgrades Ratings on 75 Tranches ----------------------------------------------------------- Moody's Investors Service has downgraded the ratings of 75 tranches from 6 transactions issued by Structured Asset Securities Corporation. The collateral backing these transactions consists primarily of first-lien, fixed and adjustable-rate, Alt-A mortgage loans. Ratings were downgraded, in general, based on higher than anticipated rates of delinquency, foreclosure, and REO in the underlying collateral relative to credit enhancement levels. The actions are a result of Moody's on-going review process. Complete rating actions are: Issuer: Structured Asset Securities Corp Trust 2005-11H -- Cl. A1, Downgraded to Baa1 from Aaa -- Cl. A2, Downgraded to A3 from Aaa -- Cl. A3, Downgraded to Baa2 from Aaa -- Cl. A-IO, Downgraded to A3 from Aaa -- Cl. A-IO1, Downgraded to A3 from Aaa -- Cl. PO, Downgraded to Baa1 from Aaa Issuer: Structured Asset Securities Corp Trust 2005-14 -- Cl. 1-A3, Downgraded to Aa2 from Aaa -- Cl. 1-A4, Downgraded to Aa2 from Aaa -- Cl. 1-A5, Downgraded to Aa2 from Aaa -- Cl. 1-A6, Downgraded to Aa2 from Aaa -- Cl. 2-A3, Downgraded to Aa2 from Aaa -- Cl. 2-A4, Downgraded to Aa2 from Aaa -- Cl. 2-A5, Downgraded to Aa2 from Aaa -- Cl. 2-A6, Downgraded to Aa2 from Aaa -- Cl. 3-A1, Downgraded to Aa2 from Aaa -- Cl. AX, Downgraded to Aa2 from Aaa -- Cl. AP, Downgraded to Aa2 from Aaa -- Cl. 1-A2, Downgraded to Aa3 from Aa1 -- Cl. 2-A2, Downgraded to Aa3 from Aa1 -- Cl. 4-A2, Downgraded to Aa3 from Aa1 -- Cl. B1, Downgraded to Baa3 from Aa3 -- Cl. B2, Downgraded to B2 from A3 -- Cl. B3, Downgraded to Ca from Baa2 -- Cl. B4, Downgraded to C from Baa3 Issuer: Structured Asset Securities Corp Trust 2005-15 -- Cl. 1-A2, Downgraded to Aa1 from Aaa -- Cl. 1-A3, Downgraded to Aa1 from Aaa -- Cl. 1-A4, Downgraded to Aa1 from Aaa -- Cl. 1-A5, Downgraded to Aa1 from Aaa -- Cl. 2-A2, Downgraded to Aa1 from Aaa -- Cl. 2-A3, Downgraded to Aa1 from Aaa -- Cl. 2-A4, Downgraded to Aa1 from Aaa -- Cl. 2-A5, Downgraded to Aa1 from Aaa -- Cl. 2-A7, Downgraded to Aa1 from Aaa -- Cl. 2-A8, Downgraded to Aa1 from Aaa -- Cl. 5-A1, Downgraded to Aa1 from Aaa -- Cl. AP, Downgraded to Aa1 from Aaa -- Cl. 1-A6, Downgraded to Aa2 from Aa1 -- Cl. 2-A9, Downgraded to Aa2 from Aa1 -- Cl. 3-A2, Downgraded to Aa2 from Aa1 -- Cl. 4-A2, Downgraded to Aa2 from Aa1 -- Cl. M, Downgraded to A2 from Aa2 Issuer: Structured Asset Securities Corp Trust 2005-16 -- Cl. 1-A4, Downgraded to Baa1 from Aaa -- Cl. 2-A2, Downgraded to A3 from Aaa -- Cl. 2-A3, Downgraded to Baa1 from Aaa -- Cl. 3-A1, Downgraded to Aa1 from Aaa -- Cl. 3-A2, Downgraded to Baa1 from Aaa -- Cl. 4-A1, Downgraded to A3 from Aaa -- Cl. B1, Downgraded to B2 from Aa2 -- Cl. B2, Downgraded to B3 from Aa3 -- Cl. B3, Downgraded to Caa1 from Baa2 -- Cl. B4, Downgraded to Ca from Ba1 -- Cl. B5, Downgraded to Ca from B1 -- Cl. B6, Downgraded to Ca from B2 Issuer: Structured Asset Securities Corp Trust 2005-17 -- Cl. 1-A1, Downgraded to Aa3 from Aaa -- Cl. 1-A2, Downgraded to Aa3 from Aaa -- Cl. 1-A3, Downgraded to Aa3 from Aaa -- Cl. 1-A4, Downgraded to Aa3 from Aaa -- Cl. 1-A5, Downgraded to Aa3 from Aaa -- Cl. 1-A6, Downgraded to Aa3 from Aaa -- Cl. 2-A1, Downgraded to Aa3 from Aaa -- Cl. 3-A1, Downgraded to Aa3 from Aaa -- Cl. 4-A6, Downgraded to A1 from Aaa -- Cl. AP, Downgraded to Aa3 from Aaa -- Cl. 5-A2, Downgraded to A1 from Aa1 Issuer: Structured Asset Securities Corp Trust 2006-3H -- Cl. 1-A1, Downgraded to Aa1 from Aaa -- Cl. 1-A2, Downgraded to Aa1 from Aaa -- Cl. 1-A3, Downgraded to Aa1 from Aaa -- Cl. 2-A1, Downgraded to Aa1 from Aaa -- Cl. A-IO, Downgraded to Aa1 from Aaa -- Cl. PO, Downgraded to Aa1 from Aaa -- Cl. B1, Downgraded to Baa3 from Aa2 -- Cl. B2, Downgraded to B3 from A2 -- Cl. B3, Downgraded to Ca from Ba1 -- Cl. B4, Downgraded to Ca from B1 -- Cl. B5, Downgraded to Ca from Caa1 SUN MICROSYSTEMS: Will Lay Off Up to 18% of Workforce ----------------------------------------------------- Don Clark at The Wall Street Journal reports that Sun Microsystems Inc. said it will lay off 5,000 to 6,000 workers, or about 15% to 18% of its workforce. WSJ quoted Cowen & Co. analyst Lou Miscioscia as saying, "They are finally realizing they have to get a lot more aggressive in bringing cost down." According to WSJ, some analysts have been pushing for actions like selling some or all of the company. Sun Microsystems' restructuring, say WSJ, would cut expenses by $700 million to $800 million per year. The company expects total restructuring charges between $500 million to $600 million over the next 12 months, WSJ states. WSJ relates that Sun Microsystems' has made these organizational changes aimed at increasing open-source software sales: -- Anil Gadre will run Sun Microsystems' new "application platform" group; -- other software will come under the control of the systems group, led by Executive Vice President John Fowler; -- a third group, under Senior Vice President Dave Douglas, will focus on "cloud computing" that generally relates to computer-services delivered through the Web. Rich Green will leave Sun Microsystems as its Executive Vice President of Software because many of his products will be transferred to the systems group, WSJ reports, citing the company's CEO Jonathan Schwartz. According to WSJ, Mr. Schwartz said that sales of another line of machines based on a line of Sparc chips would remain Sun Microsystems' key focus. "We are focused on growing long-term shareholder value," the report quoted Mr. Schwartz as saying. About Sun Microsystems Headquartered in Santa Clara, California, Sun Microsystems Inc. (NASDAQ: JAVA) -- http://sun.com/-- provides network computing infrastructure product and service solutions worldwide. Sun Microsystems conducts business in 100 countries around the globe, including Brazil, Argentina, India, Hungary, United Kingdom, among others. * * * As reported in the Troubled Company Reporter on Nov. 12, 2008, Standard & Poor's Ratings Services affirmed its 'BB+' corporate credit and senior unsecured ratings on Santa Clara, California- based Sun Microsystems Inc. In addition, S&P revised the outlook to negative from stable. As reported in the Troubled Company Reporter on Aug. 13, 2008, Moody's Investors Service affirmed its Ba1 corporate family rating as well as the Ba1 rating on Sun Microsystems Inc.'s $550 million senior unsecured notes due 2009, and revised the outlook to negative from stable. SUNCAL CENTURY: Involuntary Chapter 11 Case Summary --------------------------------------------------- Alleged Debtor: SunCal Century City LLC 2392 Morse Irvine, CA 92614 Case Number: 08-17458 Debtor-affiliates filing separate Chapter 11 petitions: Entity Case No. ------ -------- SunCal PSV LLC 08-17465 Raven Estates LLC 08-17466 Delta Coves Venture LLC 08-17470 SunCal Torrance Properties LLC 08-17472 Involuntary Petition Date: November 14, 2008 Court: Central District Of California (Santa Ana) Judge: Erithe A. Smith Petitioner's Counsel: Robert P. Goe, Esq. kmurphy@goeforlaw.com Goe & Forsythe, LLP 660 Newport Center Drive, Suite 320 Newport Beach, Ca 92660 Tel: (949) 467-3780 Fax: (949) 721-0409 Petitioners Nature of Claim Claim Amount ----------- --------------- ------------ Scott Baugh fees $15,000 4070 MacArthur, N.B., CA 92660 SUNWEST MANAGEMENT: Five Star May Buy 7 Retirement Communities -------------------------------------------------------------- Sunwest Management Inc. has reached a tentative deal with Boston- based senior housing company Five Star Quality Care, The Oregonian reports. The Associated Press relates that the deal is for the acquisition of Sunwest Management's seven retirement communities in North and South Carolina. The price is far short of the $56 million Sunwest Management owes to its largest lender, GE Business Financial Services Inc., The Oregonian states. According to The AP, dozens of individual investors who put more than $11 million into the retirement homes in the Carolinas are fighting the plan in the U.S. Bankruptcy Court for the Middle District of Tennessee. The AP says that most of Sunwest Management's 280 retirement homes aren't under bankruptcy, but many are struggling with the economic downturn. Salem, Oregon-based Sunwest Management Inc. -- http://www.sunwestmanagement.com/-- manages 275 assisted-living facilities in 36 states. Sunwest Management was founded in 1991 with a portfolio of three properties: two retirement communities and one skilled nursing community. It has a network of regional managers that handles various services from accounting to operations. Sunwest Management has put 10 assisted living centers ?- two in Oregon -- into Chapter 11 bankruptcy. Briarwood Retirement and Assisted Living Community LLC, which owns a retirement center in Springfield, and Century Fields Retirement and Assisted Living Community LLC, which owns a center in Lebanon, filed for Chapter 11 on Aug. 19, 2008. On Aug. 17, 2008, eight Sunwest-affiliated LLCs filed for Chapter 11 bankruptcy protection from creditors in Tennessee. SUPERIOR PLUS: S&P Changes Outlook to Negative; Keeps BB+ Rating ---------------------------------------------------------------- Standard & Poor's Ratings Services revised the outlook on Superior Plus L.P. to stable from negative. At the same time S&P affirmed all the ratings, including the 'BB+' long-term corporate credit rating on the company. "We base the outlook revision on what S&P view as the less severe impact than expected of the weak U.S. housing construction market on the construction distribution business," said Standard & Poor's credit analyst Jatinder Mall. "Furthermore, the chemicals business has been performing well and shouldn't be affected by recent softness in the pulp markets," Mr. Mall added. The ratings on Alberta-based Superior Plus reflect the company's dominant market position in the Canadian propane distribution business, its product diversification, and its ability to generate strong stable cash flows. Offsetting these factors in S&P's opinion are the company's high leverage and weak business risk profile for its construction distribution and energy management businesses. Superior Plus is a wholly owned subsidiary of Superior Plus Income Fund (SPIF or the fund), a limited-purpose, unincorporated trust. The fund recently announced its intent to convert to a corporation by the end of 2008 through a plan of arrangement with Ballard Power Systems Inc. Standard & Poor's takes a consolidated approach to the ratings and focuses on the fund's consolidated financial results. All of SPIF's revenues and cash flows come from Superior Plus and its subsidiaries and these cash flows service the fund's consolidated debt, including the rated secured debt at Superior Plus and SPIF's convertible debentures, as well as its trust unit distributions. The company owns and operates four distinct business divisions: Superior Propane, the largest propane distributor in Canada; ERCO Worldwide, a specialty chemicals producer of sodium chlorate and chloralkali products; Winroc, a North American construction products distributor; and Superior Energy Management, a fixed-price natural gas and electricity marketer. The stable outlook reflects S&P's expectations that Superior Plus will continue generating stable cash flows, and while debt will increase in 2009, the cash flows in 2010 will increase as well. The chemicals business should not be affected by the recent softness in the pulp markets given contracted volumes, while construction products distribution business volumes should not be affected too severely given this business' regional diversification. S&P could lower the ratings if additional cash flow generation from the Port Edwards facility does not materialize leading to a leverage ratio of closer to 4x. For Standard & Poor's to upgrade the company, Superior Plus would have to improve and sustain adjusted leverage to about 2.5x-3.0x. SYNTAX-BRILLIAN: Taps Huron Consulting as Forensic Accountants -------------------------------------------------------------- Syntax-Brillian Corporation and its debtor-affiliates ask the United States Bankruptcy Court for the District of Delaware to permission to employ Huron Consulting Services LLC as their forensic acountants. The firm is expected to (i) assist the Debtors' counsel in developing factual information, accounting expertise, and financial analysis related to certain independent audit committee investigations; and (ii) other services as may be reasonable requested in writing from time to time by the Debtors and the firm. The firm's professionals and their compensation rates are: Designation Hourly Rate ----------- ----------- managing director $695 director $540 manager $440 associate $320 analyst $230 Jeffrey Szafran, managing director of the firm, assures the Court that the firm is a "disintereste person" as defined in Section 101(14) of the Bankruptcy Code. SYNTAX-BRILLIAN: Wants ACT Litigation Agreement Rejected -------------------------------------------------------- Syntax-Brillian Corporation Inc. and its debtor-affiliates ask the United States Bankruptcy Court for the District of Delaware for authority to reject proposed statement of work agreement with ACT Litigation Services Inc. Under the agreement, ACT Litigation manges electronically store information for the Debtors and provides related web hosting services. The Debtors used these services to respond information request related to certain investigation and litigation including the informal investigation of the Securities and Exchange Commission. The Debtors tell the Court that ACT Litigation's services no long provide an efficient, cost-effective solution to manage investigation and litigation. The Debtor contends the rejection of the agreement will allow the Debtors to avoid further administrative expense claims. A hearing is set for Dec. 8, 2008, at 11:00 a.m., to consider the motion. Objections, if any, are due Dec. 1, 2008, by 4:00 p.m. TALLSHIPS FUNDING: Fitch Cuts Ratings on 4 Classes of Notes to 'C' ------------------------------------------------------------------ Fitch Ratings downgrades four classes and withdraws ratings on all classes of notes issued by Tallships Funding, Ltd./Corp.: -- $683,139,946 advance swap downgraded to 'C' from 'CCC' and withdrawn; -- $239,407,529 revolving credit agreement downgraded to 'C' from 'CCC' and withdrawn; -- $357,716,917 class A-1 notes downgraded to 'C' from 'CC' and withdrawn; -- $64,587,777 class A-2 notes downgraded to 'C' from 'CC' and withdrawn; -- $50,973,806 class B notes remain at 'C', and withdrawn; -- $39,432,476 class C notes remain at 'C', and withdrawn; -- $31,009,538 class D notes remain at 'C', and withdrawn. Tallships triggered an Event of Default as a result of the class A Principal Coverage Ratio falling below 100% on April 3, 2008. Fitch received the Notice of Acceleration and Liquidation on Aug 25, 2008, and the Notice of Completion of Liquidation on Oct. 24, 2008. The proceeds from the liquidation were distributed on Oct. 27, 2008 to pay taxes and fees, and interest on the advance swap, revolving credit agreement, class A-1 and A-2 notes. All of the notes had received a pro rata payment on the first payment date in April 2007 that reduced their principal balance; however, since then classes B, C and D have paid in kind, resulting in an ending balance higher than their original outstanding balance. TEXAS FLANGE: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Texas Flange, Inc. 218 Park Avenue Odessa, TX 79761 Bankruptcy Case No.: 08-70210 Chapter 11 Petition Date: November 6, 2008 Court: Western District of Texas (Midland) Judge: Ronald B. King Debtor's Counsel: Michael G. Kelly, Esq. mkelly@rkmfirm.com P.O. Box 1311 Odessa, TX 79760-1311 Tel: (432) 367-7271 Fax: (432) 363-9121 Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A copy of the Debtor's list of largest unsecured creditors is available for free at http://bankrupt.com/misc/txwb08-70210.pdf The Debtor's petition was signed by Vernon Williams, President. Theodore Reece: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Theodore J. Reece 202 Cook St. Denver, CO 80206-5305 Bankruptcy Case No.: 08-27856 Chapter 11 Petition Date: November 10, 2008 Court: District of Colorado (Denver) Judge: Sidney B. Brooks Debtor's Counsel: Kenneth J. Buechler, Esq. Ken.Buechler@Sendwass.com Ste. 2200, 1660 Lincoln St. Denver, CO 80264 Tel: (303) 296-1999 Fax: 303-296-7600 Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A copy of the Debtor's largest unsecured creditors is available for free at http://bankrupt.com/misc/codb08-27856.pdf The Debtor's petition was signed by Theodore J. Reece. TOMMY MILLS: Voluntary Chapter 11 Case Summary ---------------------------------------------- Debtor: Tommy Ray Mills 1138 N. Germantown Parkway No. 101332 Cordova, TN 38016 Ellen Mills 11888 George R. James Road Eads, TN 38028 Bankruptcy Case No.: 08-31904 Chapter 11 Petition Date: November 6, 2008 Court: Western District of Tennessee (Memphis) Judge: Paulette J. Delk Debtor's Counsel: James E. Bailey, III, Esq. jbailey@farris-law.com Farris Mathews One Commerce Square 40 South Main, Suite 2000 Memphis, TN 38103 Tel: (901) 259-7100 Fax: (901) 259-7150 Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtors did not file a list of their largest unsecured creditors. The petition was signed by Tommy Ray Mills and Nancy Ellen Mills. TRIBUNE CO: S&P Downgrades Ratings on Sr. Unsecured Debt Issues --------------------------------------------------------------- Standard & Poor's Ratings Services assigned to Tribune Co.'s senior unsecured and subordinated debt issues its recovery rating of '6', indicating that lenders can expect negligible (0% to 10%) recovery in the event of a payment default. S&P lowered the issue-level rating on this debt to 'CC' (two notches lower than the 'CCC' corporate credit rating on Tribune) from 'CCC' on Nov. 11. Ratings List Tribune Co. Corporate Credit Rating CCC/Negative/-- Secured CCC Recovery Rating 4 Unsecured CC Recovery Rating (newly assigned) 6 TROPICANA ENTERTAINMENT: Court Extends Removal Period to Dec. 3 --------------------------------------------------------------- Tropicana Entertainment LLC and its debtor-affiliates ask the U.S. Bankruptcy Court for the District of Delaware to further extend to April 2, 2009, the period within which they may remove civil actions pursuant to Section 1452 of the Judiciary and Judicial Procedures Code and Rules 9006 and 9027 of the Federal Rules of Bankruptcy Procedure. The Debtors' current Removal Period will expire on Dec. 3, 2008. At this stage of their Chapter 11 cases, the Debtors have not had an opportunity to determine conclusively which Actions they will seek to remove, according to Mark D. Collins, Esq., at Richards, Layton & Finger, P.A., in Wilmington, Delaware. Since July 9, 2008, through Oct. 31, 2008, the Debtors relate that together with their advisors, they have focused on addressing numerous time-critical matters, including: -- developing a comprehensive business plan; -- drafting and filing a petition with the Supreme Court of New Jersey for certification of their appeal regarding the loss of their operating license for the Tropicana Casino and Resort of Atlantic City, which has been granted and set for oral argument on November 17, 2008; -- communicating with the New Jersey regulatory authorities and the Tropicana Atlantic City conservator, Gary Stein; -- filing a motion to establish a process for the marketing and sale of their casino in Evansville, Indiana, in accordance with Section 363 of the Bankruptcy Code, and communicating with Indiana regulators regarding that process; -- reviewing and assessing unexpired real property leases to determine which leases to assume or reject before the Dec. 1, 2008 deadline; and -- developing a plan of reorganization. Mr. Collins tells the Court that the Debtors and their advisors need additional time to analyze the Actions and make the appropriate determinations concerning their removal. He assures the Court that the rights of parties to the Actions will not be unduly prejudiced by the requested extension. If the Debtors ultimately seek to remove Actions pursuant to Bankruptcy Rule 9027, counterparties to the Actions retain their rights to have the Actions remanded pursuant to Section 1452(b) of the Judiciary and Judicial Procedures Code. About Tropicana Entertainment Based in Crestview Hills, Kentucky, Tropicana Entertainment LLC -- http://www.tropicanacasinos.com/-- is an indirect subsidiary of Tropicana Casinos and Resorts. The company is one of the largest privately-held gaming entertainment providers in the United States. Tropicana Entertainment owns eleven casino properties in eight distinct gaming markets with premier properties in Las Vegas, Nevada and Atlantic City, New Jersey. Tropicana Entertainment LLC filed for Chapter 11 protection on May 5, 2008, (Bankr. D. Del. Case No. 08-10856). Its debtor- affiliates filed for separate Chapter 11 petitions but with no case numbers assigned yet. Kirkland & Ellis LLP and Mark D. Collins, Esq., at Richards Layton & Finger, represent the Debtors in their restructuring efforts. Their financial advisor is Lazard Ltd. Their notice, claims, and balloting agent is Kurtzman Carson Consultants LLC. Epiq Bankruptcy Solutions LLC is the Debtors' Web site administration agent. AlixPartners LLP is the Debtors' restructuring advisor. Stroock & Stroock & Lavan LLP and Morris Nichols Arsht & Tunnell LLP represent the Official Committee of Unsecured Creditors in this case. Capstone Advisory Group LLC is financial advisor to the Creditors' Committee. The Court has extended the Debtors' exclusive period to file a plan through and including January 12, 2009, and to solicit votes on the plan through and including March 13, 2009. (Tropicana Bankruptcy News, Issue No. 21; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) TROPICANA ENTERTAINMENT: NJ Commission Extends Sale until Jan. 21 ----------------------------------------------------------------- The New Jersey Casino Control Commission has extended the deadline for the sale of Tropicana Casino and Resort of Atlantic City to Jan. 21, 2009, according to newsday.com. The extension gives the New Jersey Supreme Court time to hear Tropicana Entertainment LLC's appeal, newsday reported. Oral arguments before the Supreme Court will begin on Nov. 17, 2008. The state court has upheld the NJ Commission's decision to revoke the casino's gaming license. Tropicana Entertainment LLC is seeking to regain control of the Tropicana Atlantic City. According to various reports, Retired Supreme Court Justice Gary S. Stein, appointed overseer of the Tropicana Atlantic City casino sale, will not make further efforts to sell the casino until the case is decided. "Tropicana Entertainment still must submit key disclosure forms before its request to take back operating control can even be considered," thepressofAtlanticCity.com quoted NJ Commission Chair Linda M. Kasserkert in a separate report. Tropicana Entertainment will receive proceeds of the Tropicana Atlantic City sale, if any, as part of the ruling in the loss of its gaming license, PAC said. Tropicana Entertainment "plans to use the money to pay down a portion of its $2,800,000,000 debt," according to PAC. 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. Epiq Bankruptcy Solutions LLC is the Debtors' Web site administration agent. AlixPartners LLP is the Debtors' restructuring advisor. Stroock & Stroock & Lavan LLP and Morris Nichols Arsht & Tunnell LLP represent the Official Committee of Unsecured Creditors in this case. Capstone Advisory Group LLC is financial advisor to the Creditors' Committee. The Court has extended the Debtors' exclusive period to file a plan through and including January 12, 2009, and to solicit votes on the plan through and including March 13, 2009. (Tropicana Bankruptcy News, Issue No. 21; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) TROPICANA INN: Ct Orders Examination of High Ridge Under Rule 2004 ------------------------------------------------------------------ The U.S Bankruptcy Court for the District of Nevada has ordered the Custodian of Records of High Ridge Partners, Inc., to appear at the law offices of Foley & Lardner LLP, at 321 North Clark Street, Suite 2800, in Chicago, commencing Nov. 20, 2008 at 10:00 a.m., and continuing, if necessary, from time to time until completed, and to be examined by counsel for Marshall Investment Corp., a creditor in Tropicana Inn Investors, LLC's Chapter 11 case, and other interested parties, regarding matters affecting the Debtor's estate, including: (i) documents supporting the claim of High Ridge in the Debtor's case, and (ii) documents supporting Debtor's claims against Perlman Design Group, LLC and Jeffrey C. Stone Inc., dba. Summit Builders of Nevada or any of Summit's subcontractors arising out of services and materials provided on The Onyx condominium project. About Onyx Las Vegas, Nevada-based Onyx, f.k.a. Tropicana Inn Investors, LLC, owns a 2-acre, 63-unit condominium project. The $28 million mid- rise project was announced in 2005 as an affordable alternative to the high rises that were being constructed near the Strip. Units at Onyx ranged from 740 square feet to 2,300 square feet and were priced from $400,000 to more than $900,000. The company filed for Chapter 11 protection on Aug. 4, 2008 (Bankr. D.Nev. Case No. 08-18719). David E. Doxey, Esq., and David J. Winterton, Esq., at David J. Winterton & Assoc., Ltd. represent the Debtor as counsel. TUBE CITY: S&P Puts 'B+' Corporate Rating on Negative Watch ----------------------------------------------------------- Standard & Poor's Ratings Services placed its ratings, including its 'B+' corporate credit rating, on Glassport, Pennsylvania-based Tube City IMS Corp. on CreditWatch with negative implications. "The CreditWatch listing reflects S&P's concerns regarding Tube City's operating performance and cash flow generating ability for the remainder of 2008 and full-year 2009," said Standard & Poor's credit analyst Maurice Austin. "Given the current economic environment and contraction of the U.S. steel market, S&P is concerned that profitability will meaningfully decline." Despite a recent commitment from its equity sponsor, Onex Partners II, to make an investment of up to $50 million in the aggregate to shore up liquidity, the company's credit profile may be inadequate to support the current rating. In resolving the CreditWatch listing, S&P will meet with management and will evaluate Tube City's near-term operating and financial strategies in light of the recent downturn in global steel production. VANGEANT INC: S&P Holds 'B+' Rating & Changes Outlook to Stable --------------------------------------------------------------- Standard & Poor's Ratings Services said that it revised its outlook on Arlington, Virginia-based Vangent Inc. to stable from negative. At the same time, Standard & Poor's affirmed its ratings on the company, including the 'B+' corporate credit rating. "The outlook revision is a result of moderate improvement in leverage and continued solid performance at the company," said Standard & Poor's credit analyst David Tsui. "The ratings on Vangent reflect its relatively modest position in a fragmented government IT industry, highly leveraged financial profile, and concentrated customer base." These negative factors are offset somewhat by the firm's established niche market position in a favorable government IT outsourcing industry and fairly stable revenue base from long-term contracts. Continued consolidation within the government IT industry has left Vangent facing many larger competitors with greater financial resources and broader technical capabilities as the company competes for new contracts. Vangent's ability to maintain its currently strong win rate on re-compete contracts will be important as it faces increasingly competitive bidding. Vangent has a relatively modest presence in the highly competitive and consolidating government IT services market and a concentrated customer base. The company focuses on the U.S. Department of Health and Human Services, the Department of Education, and the Department of Labor, and its top 10 customers constitute about 70% of total revenues. However, partially offsetting these factors are a predictable revenue stream based on embedded customer relationships, the expectation that government-related IT outsourcing services business will remain fairly solid over the intermediate term, and a significant contract backlog. As of Sept. 30, 2008, the company had approximately $1.6 billion of total backlog, or 3x its current revenue level. Revenues for the 12 months ended Sept. 30, 2008, were $548 million, up 13% from the same period of last year, due to new contract awards from government agencies and an increase in prescription drug enrollment volume under continuing Medicare- related outsourcing contracts. The outlook is stable, reflecting good revenue visibility from long-term contracts and a strong contract backlog. S&P could revise the outlook to negative if Vangent experiences any loss of significant contracts or fails to maintain its current profitability level, leading to leverage returning to the mid-6x level. While unlikely in the near term, S&P could revise the outlook to positive if Vangent continues to lower debt and is able to sustain debt leverage at the 4x level as the company continues to improve its new contract win rate and, at the same time, maintain its win rate on re-compete contracts, leading to stable cash flow generation for debt reduction. VERSANT PROPERTIES: Involuntary Chapter 11 Case Summary ------------------------------------------------------- Alleged Debtor: Versant Properties, LLC 225 East Worthington Ave, Suite 102 Charlotte, NC 28203 Case Number: 08-10930 Petitioning Creditors: (1) Civil Design Concepts, P.A. 200 Swannanoa River Road Asheville, NC 28805 Counsel: Armistead M. Long, Esq. Van Winkle, Buck, Wall, Starnes & Davis 11 N. Market Street P.O. Box 7376 Asheville, NC 28802 828-258-2991 Fax: 828-257-2767 Email: along@vwlawfirm.com (2) Haynes Electric Utility Corporation P.O. Box 16589 Asheville, NC Counsel: Armistead M. Long, Esq. Van Winkle, Buck, Wall, Starnes & Davis 11 N. Market Street P.O. Box 7376 Asheville, NC 28802 828-258-2991 Fax: 828-257-2767 Email: along@vwlawfirm.com (3) Huntley Construction Co. 121 Charlotte Highway Asheville, NC 28803 Counsel: T. Douglas Wilson, Jr., Esq. McGuire, Wood & Bissette, P.A. P. O. Box 3180 Asheville, NC 28802-3180 (828) 254-8800 (4) APAC-Atlantic, Inc. 1188 Smokey Park Highway Candler, NC 28715 Counsel: Douglas J. Tate McGuire, Wood & Bissette, P.A. P. O. Box 3180 Asheville, NC 28802 (828) 254-8800 Email: dtate@mwbavl.com Involuntary Petition Date: November 14, 2008 Court: U.S. Bankruptcy Court Western District of North Carolina (Asheville) Judge: George R. Hodges Petitioners Nature of Claim Claim Amount ----------- --------------- ------------ Huntley Construction Contract $2,757,120 APAC-Atlantic Contract 783,088 Civil Design Concepts Contract 166,062 Haynes Electric Utility Contract 103,589 VIRGIN MOBILE: Cuts 10% of Workforce in New Jersey and California ----------------------------------------------------------------- Virgin Mobile USA will eliminate approximately 45 positions in its New Jersey and California offices, which represents approximately 10% of its workforce. In a memo to employees on Nov. 17, Virgin Mobile USA's CEO Dan Schulman explained that the company had identified continued synergies associated with the transition of IT services to IBM and the acquisition of Helio. "We have assessed the status of the company post-integration and have identified some remaining duplication of assignments. Our intent is to expand our investment in both our prepaid and new postpaid business and, in order to do so profitably, we must continue to identify opportunities to reduce operating costs across all areas. Virgin Mobile USA is well positioned to weather these tough times and build our business in 2009. Our value proposition and wide range of products and services are more relevant than ever in an environment where consumers are looking for value and flexibility," Mr. Schulman said. Virgin Mobile USA also said on Friday that John Feehan, its current CFO who had previously announced intentions to leave the Company this month, will be continuing in his role. Headquartered in Warren, New Jersey, Virgin Mobile USA Inc. (NYSE: VM) -- http://www.virginmobileusa.com/-- is a provider of wireless, pay-as-you-go communications services without annual contracts. Voice pricing plans range from monthly options with unlimited nights and weekends to by-the-minute offers, allowing consumers to adjust how and what they pay according to their needs. Virgin Mobiles full slate of handsets, including the Wild Card, Super Slice and Cyclops, are available at top retailers in more than 35,000 locations nationwide and online, with Top-Up cards available at more than 130,000 locations. According to Virgin Mobile's unaudited balance sheet on Sept. 30, 2008, the company has $395,989,000 in assets, $695,081,000 in liabilities and $355,482,000 stockholders' deficit. WYNN RESORTS: Amendment to $1-BB Loan Won't Affect S&P 'BB' Rating ------------------------------------------------------------------ Standard & Poor's Ratings Services said that its 'BB' corporate credit rating and stable outlook on Las Vegas-based Wynn Resorts Ltd. and its wholly owned subsidiary, Wynn Las Vegas LLC (jointly "Wynn"), would not be affected by the amendment to its $1 billion senior unsecured term loan (issued by Wynn Resorts Ltd.) announced on Nov. 13, 2008. The amendment permits the repurchase of up to $650 million principal value of its term loan. In addition, the company's plans to issue up to 9.2 million shares of common stock at a price of $43.50 per share, the proceeds of which could be applied toward the repurchase of the term loan debt. According to the terms of the amendment, the company has the option to conduct a Dutch tender auction to be completed on or before March 31, 2009. This would represent up to 13% of Wynn's total consolidated debt as of Sept. 30, 2008. Although this transaction could result in Wynn redeeming a portion of its bank debt at less than par, which, in S&P's opinion, diverges from the original obligation terms, S&P acknowledge that the company will be voluntarily making these payments with excess liquidity, including proceeds from the planned public offering of common stock, and that lenders are not obligated to accept. In addition, S&P assumes specific lenders that choose to accept are most likely doing so for their own liquidity needs in the currently tight credit environment, as they could potentially have commitments to other, less liquid deals. In addition to proceeds from the issuance of new common stock, Wynn had approximately $1.7 billion of cash on its balance sheet as of Sept. 30, 2008, although a substantial portion is earmarked for ongoing developments in Las Vegas and Macau. In addition, nearly $500 million remains available under a revolving credit facility at its Macau subsidiary. While consolidated leverage was 6.5x as of Sept. 30, 2008, S&P expects that, notwithstanding currently challenging market conditions in both Las Vegas and Macau, Wynn is near its peak leverage, and that credit measures will improve over the intermediate term, helped, in part, by the opening of Encore next month. * Fitch Provides Update on Recent Gaming Liquidity Trends --------------------------------------------------------- Since Fitch Ratings published its sector liquidity report on Oct. 23, 2008, most companies have reported Q3'08 results and there have been some notable liquidity-related events. In its Oct. 23, 2008 report, Fitch indicated that the most concerning liquidity profiles amongst corporate gaming operators in the review included Trump Entertainment Resorts, Inc., Station Casinos, Inc., Las Vegas Sands Corp. and MGM MIRAGE. All of these gaming operators addressed liquidity concerns to some degree in the last few weeks, which Fitch discusses: -- MGM issued $750 million of senior secured notes; -- LVS raised $2.1 billion of equity/junior capital; -- Trump revised terms of the Trump Marina sale; -- Station noted it is in discussions to revise its credit facility covenants. As expected, Q3'08 industry wide operating results were very weak, and indications of forward trends support Fitch's view that the soft operating results are likely to persist for at least the next few quarters. While anecdotal evidence indicates that early Q4'08 trends are tracking slightly better than September 2008, September 2008 was likely one of the worst months the industry has experienced. In addition, while it is a credit positive that MGM and LVS were able to access the capital markets and improve their liquidity profiles, the terms and costs associated with both transactions were highly unfavorable, in Fitch's view. Fitch's concerns regarding Trump and Station did not center around access to capital. Rather, Trump's outlook relies on closing the Trump Marina sale, while Station's outlook relies on successful negotiations with its bank lenders. * MGM: Near-term liquidity improvement, long-term concern remains: MGM priced a $750 million senior secured note issue at 93.132% on Oct. 31, 2008, a discount that resulted in a 15% yield and net proceeds to MGM of $687 million. The transaction is expected to close on Nov. 14, 2008. Separately, in October 2008, MGM received notice of a put option from substantially all holders of Mandalay Resort Group's $150 million 7% debentures due 2036, which requires MGM to repurchase the debt on Nov. 15, 2008. Therefore, MGM's net increase in liquidity after consideration of the discount and bond repurchase is $537 million. MGM's ability to close the transaction and enhance its liquidity somewhat mitigates Fitch's concern regarding debt maturities of $1.3 billion in 2009 and near-term CityCenter funding requirements. However, MGM's longer-term liquidity profile and the weak near-term operating environment remain concerns. MGM reported a decline in comparable property EBITDA of 18% in Q3'08, following a 12% decline in Q2'08. Fitch expects the weak operating environment in Las Vegas to continue for at least the next few quarters. It is a credit positive that MGM was able to access the capital markets in this environment. However, Fitch believes the adverse terms, including the high interest cost and required collateral, indicate that MGM's access to capital on an unsecured basis remains extremely limited, if not effectively closed. MGM's ability to issue additional secured debt is limited by this issuance, the extent depending on the market value assigned to collateral, which is the New York-New York property. * LVS: Capital raise averts near-term covenant violations; suspension of projects reduces longer-term capex: LVS took the most aggressive action to enhance its liquidity position, as its needs were more immediate due to potential covenant violations on its credit facility in upcoming quarters. In order to maintain compliance with its U.S. credit facility, on Sept. 30, 2008 LVS used a $475 million investment by Chairman and CEO Sheldon Adelson to reduce net debt at Las Vegas Sands LLC, its U.S. subsidiary. In addition, it used a $50 million EBITDA 'true- up', or equity cure, which has the effect of increased adjusted EBITDA for the purposes of the calculation, an option that can be used for only two consecutive quarters until the leverage covenant is satisfied. However, the true-up by itself would not have been sufficient to maintain compliance, and given the continued operating pressure in Las Vegas, the company needed additional capital. As a result, LVS raised an additional $2.1 billion of equity/junior capital at heavily discounted levels, including another $525 million from Adelson, which will significantly improve the company's liquidity profile. The transaction is expected to close on Nov. 14, 2008 and was approved without shareholder approval pursuant to an exception in the NYSE's shareholder approval policy, indicating that a delay caused by securing shareholder approval would seriously jeopardize the ability to complete the offerings and the financial viability of the company. In addition, LVS significantly pulled back on development plans in both the U.S and Macau. In the U.S. it suspended its St. Regis condo tower in Las Vegas indefinitely and scaled back on the Sands Bethlehem project in Pennsylvania that is expected to open in 2Q'09. In Macau, LVS is significantly slowing development on the Cotai Strip, including suspending developments of sites five and six. The company will proceed with its Singapore development, which will be fully funded with existing availability under its Singapore bank facility and the additional capital. In Fitch's view, the capital infusion alleviates near-term concerns regarding a covenant violation on its U.S. bank facility, which is cross defaulted with its US airplane financing and U.S. notes. In addition, although it will be spending a significant amount of capital just to mothball projects in the near-term, by meaningfully reducing longer-term capital expenditures and reducing the scope of some projects, LVS has accelerated its ability to self-fund a portion of its development plans. Coupled with limited debt maturities until portions of the Macau credit facility come due in 2011, LVS' actions greatly increase its financial flexibility. However, Fitch continues to be concerned regarding the Las Vegas operating environment in 2009, which will be very challenging for LVS, given the economic environment and the imminent opening of Wynn's Encore property. * TRUMP: Overall profile remains dependant on closing the Trump Marina sale: Fitch continues to believe that near-term stabilization of Trump's weak liquidity profile is highly dependent on the completion of the Trump Marina sale to Coastal Development, LLC and the success of the Chairman Tower at the Taj Mahal. On Oct. 28, 2008, the deadline for Coastal to provide financing commitments to Trump, the parties mutually amended the Trump Marina purchase agreement. The purchase price was revised to $270 million from $316 million with no provision for a decrease based on property performance, a termination date of May 28, 2009 was set, and the purchase deposit was increased to $17 million, of which $15 million has been released to Trump. In Fitch's view, the amended agreement provides more time for financial markets to improve, which could provide greater ability to close the transaction. Trump expects to draw the remaining $25 million available on its credit facility in Q4'08 to help fund the completion of the Chairman Tower. After fully drawing on the credit facility, Trump will have little to no access to committed external funds. Since the Chairman Tower's partial opening on Labor Day, the Taj has outperformed the market on a revenue basis, which is positive. However, given Trump's heavy debt load and the expected operating pressure in Atlantic City over the next 12 months, it is crucial for Trump to close the Trump Marina sale in order to avoid a restructuring, in the absence of another transaction, in Fitch's view. * STATION: Outlook relies on successful negotiation with banks: The company needs to amend its bank facility financial covenants (outlined in Fitch's Oct. 23 report), as it will likely not be in compliance as of Dec. 31, 2008. As such, Station noted it is currently negotiating with lenders, but if it can not reach a successful resolution, it would result in an event of default. In addition, Fitch remains concerned regarding Station's ability to generate cash on an operating basis after maintenance capex, given the continued deterioration in the Las Vegas locals market and the heavy debt load from its LBO transaction. Adjusted EBITDA in Q3'08 declined 13%, which was worse than the 11% declines experienced in Q1'08-Q2'08. Early Q4'08 revenue declines were greater than Q3, likely due to increased competition, as Fitch outlined in its Oct. 23, 2008 report. While the Nov. 11, 2008 opening of the 50%-owned Aliante Station will help operating performance, it will likely cannibalize Santa Fe Station's results to some degree. * Moody's Cuts Ratings on 3 Tranches From Two Transactions ---------------------------------------------------------- Moody's has downgraded three tranches from two transactions backed by recreational vehicle loans. The two transactions include the CIT RV Trust 1999-A and the SSB RV Trust 2001-1. The rating actions reflect higher than expected losses and continued deterioration of performance. As a result of the losses incurred to date, the CIT RV Trust 1999-A transaction is undercollateralized by approximately $13,687,090 and the Certificates are accruing interest shortfalls. The Class B notes and Certificates of this transaction were previously downgraded on July 11, 2006, to B2 from Ba2 and Ca from Caa1 respectively. As a result of the losses, the reserve fund in the SSB RV Trust 2001-1 transaction has decreased to $46,684 and will likely be fully depleted in the short term. The Class C and Class D notes of this transaction were previously downgraded on Aug. 29, 2005 to A3 from A2 and Ba3 from Baa3 respectively. Complete rating actions are: -- Issuer: CIT RV Trust 1999-A -- Class B, Downgraded to Caa2 from B2 -- Certificates, Downgraded to C from Ca Issuer: SSB RV Trust 2001-1 -- Cl. D, Downgraded to Ca from Ba3 * PBGC Reduces FY08 Deficit to $10.7 Billion -------------------------------------------- WASHINGTON? The Pension Benefit Guaranty Corporation ended fiscal year 2008 with its overall deficit reduced by nearly $3 billion, according to the agency's Annual Management Report submitted to Congress today. The PBGC's insurance program for single-employer pension plans reported a deficit of $10.7 billion, a $2.4 billion improvement over last year's $13.1 billion shortfall. The deficit of the insurance program for multiemployer pension plans was cut in half to $473 million, a $482 million improvement from the $955 million deficit reported a year earlier. "The PBGC's lower deficit is good news, although it is important to remember that the deficit number is only a snapshot of where we stood on September 30," said Director Charles E.F. Millard. "Successful negotiations with companies in bankruptcy protected workers' pensions and sliced hundreds of millions of dollars in liabilities off our books. Favorable interest rate changes reduced liabilities, and our careful stewardship of the PBGC's investments limited losses to 6.5 percent of assets. Although the current turbulence in our economy will mean a challenging environment in 2009, the PBGC has the resources to meet its commitments to America's retirees for many years to come." The decline in the deficit in the single-employer program was primarily due to a $7.6 billion actuarial credit from a favorable change in interest factors, $1.4 billion in premium income, credits of $826 million from completed and probable terminations and $649 million in favorable actuarial adjustments. These amounts were offset by investment losses of $4.2 billion and a $3.4 billion actuarial charge to passage of time. Total return on invested funds was -6.5 percent. As of September 30, the single-employer program reported assets of $61.6 billion and liabilities of $72.3 billion. The Employee Retirement Income Security Act of 1974 (ERISA), which established the PBGC, explicitly says that the United States government does not stand behind these liabilities. The single-employer program posted premium income of about $1.40 billion in 2008, a slight decrease from $1.48 billion in 2007. Congress currently has authority for setting the premium rates companies pay to the PBGC. To help the PBGC attain solvency and pay benefits to future retirees, the Administration has proposed granting the Corporation the ability to set premiums, just as private-sector insurers do. In 2008, no new large pension plans were classified as probable losses on the PBGC balance sheet. The Annual Management Report also shows the PBGC's potential exposure to future pension losses from financially weak companies decreased to $47 billion, compared to $66 billion in 2007. During the year, the single-employer program took in 67 newly terminated pension plans. The program is directly responsible for the benefits of about 1.2 million workers and retirees in 3,850 pension plans. Overall benefit payments remained relatively flat at $4.3 billion from 2007 to 2008. The program insures the pensions of 33.8 million Americans in about 27,900 ongoing plans sponsored by private-sector employers. PBGC's separate insurance program for multiemployer pension plans has about $1.3 billion in assets to cover about $1.8 billion in liabilities. The PBGC does not become trustee of multiemployer plans, but instead offers financial assistance to insolvent plans. In 2008 such assistance totaled $85 million to 42 plans. Overall, the multiemployer program insures the pensions of more than 10 million Americans in some 1,500 plans. PBGC's financial statements are prepared in accordance with accounting principles generally accepted in the United States of America. The financial statements for fiscal year 2008 received an unqualified audit opinion for the 16th consecutive year. Clifton Gunderson LLP performed the audit under contract with the Corporation's Inspector General, who oversees the audit. PBGC is a federal corporation created under ERISA. It currently insures the basic pension benefits of almost 44 million American workers and retirees in more than 29,000 private-sector defined benefit pension plans. The Corporation receives no funds from general tax revenues. Operations are financed largely by insurance premiums paid by companies that sponsor pension plans and by PBGC's investment returns * S&P Comments on Freddie Mac's $25.3 Billion Third-Quarter Loss ---------------------------------------------------------------- Freddie Mac reported a sizable $25.3 billion loss in third-quarter 2008 primarily due to a noncash charge of $14.3 billion related to its establishment of a partial valuation allowance for its deferred tax-asset. Other sizeable charges in the quarter include $9.1 billion of security impairment charges taken on its nonagency mortgage-backed securities and sizeable credit-related expenses totaling $6 billion. This quarterly loss, although significant, will not at this time lead Standard & Poor's Ratings Services' to change its ratings on Freddie Mac's 'AAA/A-1+' senior debt, 'A' subordinated debt, or 'C' preferred stock, due to S&P's assessment of Freddie Mac's current operation under a regulatory conservatorship. The establishment of the valuation allowance for the deferred tax asset reflects the high degree of uncertainty surrounding Freddie Mac's earnings as it operates under conservatorship. S&P believes that Freddie Mac's business plan while under conservatorship will be geared primarily to fulfilling its public policy role of providing mortgage liquidity to the U.S. housing markets. With this as its main business focus, S&P believe Freddie Mac's core profitability metrics will suffer and any initiatives to improve its core earnings will be of secondary importance. The remaining deferred tax asset represents the tax effect of unrealized losses on available for sale securities, since Freddie Mac has the intent and the ability to hold these securities until maturity. Credit-related expenses were high compared with prior periods due to the allocation of $6 billion to the loan-loss provision as the guaranteed mortgage portfolio continues to show credit deterioration. Delinquencies are higher, and losses on the disposition of foreclosed properties are now trending higher as well. S&P expects Freddie Mac's net credit losses will peak in 2009 and that they will be twice as high as 2008's net credit losses. In S&P's opinion, this sizeable GAAP (generally accepted accounting principles) loss in the quarter has severely impaired Freddie Mac's capital position, as it ended the quarter with a capital deficit of $13.79 billion. Under Freddie Mac's Senior Preferred Stock Purchase Agreement with the U.S. Treasury, the Director of the Federal Housing Finance Agency has submitted a request to the Treasury under the purchase agreement in the amount of $13.8 billion, which will allow for the maintenance of a positive GAAP net worth position. This will be Freddie Mac's first request for senior preferred stock under the Treasury's senior preferred stock purchase program. * S&P Downgrades Ratings on 60 Tranches From 20 Hybrid CDO Deals ---------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on 60 tranches from 20 U.S. cash flow and hybrid collateralized debt obligation transactions. S&P removed 28 of the lowered ratings from CreditWatch with negative implications. At the same time, S&P placed three ratings from two transactions on CreditWatch with negative implications. In addition, S&P affirmed one rating from MKP CBO IV Ltd. and removed it from CreditWatch with negative implications. The ratings on 27 of the downgraded tranches are on CreditWatch with negative implications, indicating a significant likelihood of further downgrades. The CreditWatch placements primarily affect transactions for which a significant portion of the collateral assets currently have ratings on CreditWatch with negative implications or have significant exposure to assets rated in the 'CCC' category. The 60 downgraded U.S. cash flow and hybrid tranches have a total issuance amount of $6.219 billion. Sixteen of the 20 affected transactions are mezzanine structured finance CDOs of asset-backed securities, which are collateralized in large part by mezzanine tranches of residential mortgage-backed securities and other SF securities. Three of the 20 affected transactions are high-grade SF CDOs of ABS that were collateralized at origination primarily by 'AAA' through 'A' rated tranches of RMBS and other SF securities. The other transaction is a CDO of CDOs that was collateralized at origination primarily by notes from other CDOs, as well as by tranches from RMBS and other SF transactions. CDO downgrades reflect a number of factors, including credit deterioration and recent negative rating actions on U.S. subprime RMBS. In addition, Standard & Poor's reviewed the ratings assigned to Independence I CDO Ltd., Independence II CDO Ltd., and Stack 2004-1 Ltd. and has left the ratings at their current levels based on the current credit support available to support the tranches. To date, including the CDO tranches listed below and including actions on both publicly and confidentially rated tranches, S&P has lowered S&P's ratings on 4,024 tranches from 897 U.S. cash flow, hybrid, and synthetic CDO transactions as a result of stress in the U.S. residential mortgage market and credit deterioration of U.S. RMBS. In addition, 1,054 ratings from 442 transactions are currently on CreditWatch with negative implications for the same reasons. In all, S&P has downgraded $479.494 billion of CDO issuance. Additionally, S&P's ratings on $12.584 billion of securities have not been lowered but are currently on CreditWatch with negative implications, indicating a high likelihood of future downgrades. Standard & Poor's will continue to monitor the CDO transactions it rates and take rating actions, including CreditWatch placements, when appropriate. Rating Actions Rating Transaction Class To From ----------- ----- -- ---- Acacia CDO 10, Ltd. A-1 BBB-/Watch Neg A+/Watch Neg Acacia CDO 10, Ltd. A-2 B+/Watch Neg BBB+/Watch Neg Acacia CDO 10, Ltd. B CCC+ BB+/Watch Neg Acacia CDO 10, Ltd. C CC B-/Watch Neg Acacia CDO 7 Ltd A AA+/Watch Neg AAA Acacia CDO 7 Ltd B A-/Watch Neg AA Acacia CDO 7 Ltd C BBB/Watch Neg A Acacia CDO 7 Ltd D B+/Watch Neg BBB Acacia CDO 7 Ltd E CCC BB Bleecker Structured A-1 B-/Watch Neg B- Asset Funding Ltd. Bleecker Structured A-2 B-/Watch Neg B- Asset Funding Ltd. CAMBER 3 plc S A/Watch Neg AA-/Watch Neg CAMBER 3 plc A-1 BB/Watch Neg BBB/Watch Neg CAMBER 3 plc A-2 BB-/Watch Neg BBB-/Watch Neg CAMBER 3 plc B CC CCC/Watch Neg Dunhill ABS CDO Ltd A-2 BBB-/Watch Neg AA/Watch Neg Dunhill ABS CDO Ltd B CC CCC/Watch Neg Fort Point CDO II Ltd. A-1 BBB/Watch Neg AA-/Watch Neg Fort Point CDO II Ltd. A-2 CC B-/Watch Neg Fort Sheridan ABS CDO Ltd A-1 B+/Watch Neg A+/Watch Neg Fort Sheridan ABS CDO Ltd A-2 CCC BBB+/Watch Neg Fort Sheridan ABS CDO Ltd B CC BB-/Watch Neg Fort Sheridan ABS CDO Ltd C-1 CC CCC-/Watch Neg Fort Sheridan ABS CDO Ltd C-2 CC CCC-/Watch Neg Fort Sheridan ABS CDO Ltd C-3 CC CCC-/Watch Neg Galleria V Ltd A-1 A+/Watch Neg AAA/Watch Neg Galleria V Ltd A-2 A+/Watch Neg AAA/Watch Neg Galleria V Ltd B BB-/Watch Neg BBB+/Watch Neg Galleria V Ltd C-1 CCC- CCC/Watch Neg Galleria V Ltd C-2 CCC- CCC/Watch Neg Glacier Funding CDO I Ltd B A+/Watch Neg AA Glacier Funding CDO I Ltd C B/Watch Neg BBB/Watch Neg Glacier Funding CDO I Ltd Pref Shrs CC B/Watch Neg G-STAR 2005-5 Ltd A-1 AA AAA/Watch Neg G-STAR 2005-5 Ltd A-2 A- AA/Watch Neg G-STAR 2005-5 Ltd A-3 BBB/Watch Neg A/Watch Neg G-STAR 2005-5 Ltd B BB/Watch Neg BBB/Watch Neg G-STAR 2005-5 Ltd C CCC+ BB+/Watch Neg G-STAR 2005-5 Ltd Income Not CC CCC-/Watch Neg Helios Series I Multi A AA+/Watch Neg AA+ Asset CBO, Ltd Helios Series I Multi B BB+/Watch Neg BBB+ Asset CBO, Ltd Independence III CDO Ltd B BBB A+ Independence III CDO Ltd C-1 CCC- CCC Independence III CDO Ltd C-2 CCC- CCC Independence V CDO Ltd A-1 BBB/Watch Neg AA Lakeside CDO II Ltd B CCC B/Watch Neg Longport Funding II, Ltd. A1S AA+ AAA Longport Funding II, Ltd. A1J A/Watch Neg AA-/Watch Neg Longport Funding II, Ltd. A2 BB/Watch Neg BBB+/Watch Neg Longport Funding II, Ltd. A3 CCC- B/Watch Neg Longport Funding II, Ltd. Combo Sec CCC- B/Watch Neg Longshore CDO Funding 2006-1 A-1 B-/Watch Neg A+/Watch Neg Longshore CDO Funding 2006-1 A-2 CC BB-/Watch Neg MKP CBO IV, Ltd. A-2 A- A+/Watch Neg MKP CBO IV, Ltd. B CCC- CCC-/Watch Neg Porter Square CDO I, Ltd C B+/Watch Neg BBB-/Watch Neg River North CDO Ltd A-1 A A+/Watch Neg River North CDO Ltd A-2 BB-/Watch Neg BB+/Watch Neg River North CDO Ltd B CC CCC-/Watch Neg Sherwood Funding CDO II A-1 B/Watch Neg A/Watch Neg Sherwood Funding CDO II A-2 CC B+/Watch Neg Sherwood Funding CDO II B CC CCC-/Watch Neg TABS 2005-2 Oakville Ltd A-1 CCC+ A/Watch Neg TABS 2005-2 Oakville Ltd A-2 CC BB+/Watch Neg Other Ratings Reviewed Transaction Class Rating ----------- ----- ------ Acacia CDO 10, Ltd. D CC CAMBER 3 plc C CC CAMBER 3 plc D CC Dunhill ABS CDO Ltd A-1NV AAA Dunhill ABS CDO Ltd A-1VA AAA Dunhill ABS CDO Ltd A-1VB AAA Dunhill ABS CDO Ltd C CC Fort Point CDO II Ltd. A-3 CC Fort Point CDO II Ltd. B CC Fort Point CDO II Ltd. C CC Galleria V Ltd Pref Share CC Glacier Funding CDO I, Ltd. A-1 AAA Glacier Funding CDO I, Ltd. A-2 AAA Independence I CDO Ltd. A A- Independence II CDO Ltd. A A+ Independence III CDO, Ltd. A-1 AAA Independence III CDO, Ltd. A-2 AAA Independence V CDO, Ltd. A-2A CC Independence V CDO, Ltd. A-2B CC Independence V CDO, Ltd. B CC Independence V CDO, Ltd. C CC Independence V CDO, Ltd. Ser 1 Pref CC Independence V CDO, Ltd. Ser 2 Pref CC Lakeside CDO II Ltd A-1 AAA Lakeside CDO II Ltd C CC Longport Funding II, Ltd. B CC Longport Funding II, Ltd. Income Nts CC Longshore CDO Funding 2006-1 B CC Longshore CDO Funding 2006-1 C CC Longshore CDO Funding 2006-1 D CC MKP CBO IV, Ltd. A-1 AAA MKP CBO IV, Ltd. C CC Porter Square CDO I, Ltd A-2 AAA Porter Square CDO I, Ltd A-3 AAA Porter Square CDO I, Ltd B AAA River North CDO Ltd C CC River North CDO Ltd D-1 CC River North CDO Ltd D-2 CC Sherwood Funding CDO II, Ltd. C CC Sherwood Funding CDO II, Ltd. D CC Stack 2004-1 Ltd A AAA Stack 2004-1 Ltd B AA Stack 2004-1 Ltd C A Stack 2004-1 Ltd D BB+ TABS 2005-2 Oakville Limited B CC TABS 2005-2 Oakville Limited C CC TABS 2005-2 Oakville Limited D CC * S&P Says Economic Data More Clearly Point to a Recession ---------------------------------------------------------- The recession is unfortunately becoming a lot clearer, said Standard & Poor's Chief Economist David Wyss in a Web cast made. The latest economic data are showing that the economy is continuing to head downward. Consumer spending is on the decline, which doesn't bode well as S&P enter the holiday shopping season. But the biggest news was the employment report, with payrolls declining for the 10th consecutive period. Moreover, the unemployment rated jumped to 6.5%, the highest rate since the last recession in 1991-1992. * Large Companies with Insolvent Balance Sheets ----------------------------------------------- Total Total Working Assets Equity Capital Company Ticker ($MM) ($MM) ($MM) ------- ------ ------ ------ ------- APP PHARMACEUTIC APPX US 1,105 (41.69) 259.64 ARBITRON INC ARB US 162.41 (9.33) (39.23) BARE ESCENTUALS BARE US 272.49 (24.77) 125.37 BLOUNT INTL BLT US 485.28 (20.09) 119.08 CABLEVISION SYS CVC US 9,716.99 (4,965.85) (1,583.16) CENTENNIAL COMM CYCL US 1,393.93 (1,025.77) 86.00 CHENIERE ENERGY CQP US 2,020.62 (311.81) 178.97 CHENIERE ENERGY LNG US 2,832.34 (202.04) 293.30 CHOICE HOTELS CHH US 349.93 (90.51) (7.61) CLOROX CO CLX US 4,587.00 (364.00) (396.00) CV THERAPEUTICS CVTX US 391.99 (225.60) 285.98 CYBERONICS CYBX US 143.73 (6.63) 118.57 DELTEK INC PROJ US 187.99 (61.84) 34.16 DISH NETWORK-A DISH US 7,177.25 (2,129.50) (1,318.20) DOMINO'S PIZZA DPZ US 440.85 (1,437.39) 84.39 DUN & BRADSTREET DNB US 1,642.30 (554.20) (205.90) DYAX CORP DYAX US 91.03 (27.97) 32.66 ENERGY SAV INCOM SIF-U CN 437.86 (248.49) (86.87) EXELIXIS INC EXEL US 254.76 (23.45) (1.44) EXTENDICARE REAL EXE-U CN 1,529.85 (19.85) 117.94 GARTNER INC IT US 1,115.42 (14.96) (253.32) GENCORP INC GY US 1,014.00 (22.00) 65.50 GENERAL MOTORS C GMB BB 110,425.00 (58,994.00) (18,461.00) HEALTHSOUTH CORP HLS US 1,980.50 (874.10) (217.90) INCYTE CORP INCY US 204.74 (237.20) 152.40 INTERMUNE INC ITMN US 205.78 (92.04) 151.36 IPCS INC IPCS US 559.43 (43.57) 47.56 KNOLOGY INC KNOL US 646.88 (43.63) 12.89 LINEAR TECH CORP LLTC US 1,664.87 (377.94) 1,108.62 MEDIACOM COMM-A MCCC US 3,687.57 (279.31) (311.33) MOODY'S CORP MCO US 1,694.30 (893.80) (331.00) NATIONAL CINEMED NCMI US 540.10 (474.80) 58.00 NAVISTAR INTL NAV US 11,557.00 (228.00) 1,501.00 NEWCASTLE INVT C NCT US 5,785.23 (340.10) - NPS PHARM INC NPSP US 201.96 (207.84) 90.48 OCH-ZIFF CAPIT-A OZM US 2,224.17 (172.89) - OSIRIS THERAPEUT OSIR US 28.55 (8.19) (14.45) OVERSTOCK.COM OSTK US 145.46 (3.68) 33.49 PROTECTION ONE PONE US 653.82 (51.85) 3.66 REGAL ENTERTAI-A RGC US 2,557.50 (223.90) (111.90) REVLON INC-A REV US 876.60 (999.30) 8.10 ROTHMANS INC ROC CN 535.56 (209.44) 99.72 SALLY BEAUTY HOL SBH US 1,495.77 (694.90) 412.63 SONIC CORP SONC US 836.31 (64.12) (13.12) SUCCESSFACTORS I SFSF US 167.82 (2.93) 3.97 SYNTA PHARMACEUT SNTA US 90.76 (34.61) 57.71 TAUBMAN CENTERS TCO US 3,181.86 (20.38) - THERAVANCE THRX US 255.26 (125.15) 208.02 UAL CORP UAUA US 20,731.00 (1,282.00) (1,583.00) UST INC UST US 1,402.19 (325.57) 236.75 WARNER MUSIC GRO WMG US 4,519.00 (99.00) (750.00) WEIGHT WATCHERS WTW US 1,110.40 (900.83) (269.75) WESTERN UNION WU US 5,504.20 (90.20) 318.90 WR GRACE & CO GRA US 3,754.20 (178.90) 970.10 ********* 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. Ronald C. Sy, Joel Anthony G. Lopez, Cecil R. Villacampa, Luke Caballos, Sheryl Joy P. Olano, Carlo Fernandez, 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 ***