/raid1/www/Hosts/bankrupt/TCR_Public/011024.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Wednesday, October 24, 2001, Vol. 5, No. 208
Headlines
BETHLEHEM STEEL: Signs-Up Cravath As Special Corporate Counsel
CELLSTAR: Must Raise Up to $150MM to Pay-Off Notes due Oct. 2002
COMDISCO INC: DOJ Files Suit to Block SunGard Acquisition
CONOCO CANADA: Plummets Into Red in Q3 After Restructuring
DANKA BUSINESS: Selling NZ Assets to Minolta to Reduce Debt
DERBY CYCLE: Completes Issuance of DM$15.3MM DM Notes to Lyon
EXODUS COMMS: US Trustee Appoints Official Creditors' Committee
FEDERAL-MOGUL: Seeks to Waive Sec. 345 Investment Requirements
FITZGERALDS GAMING: To Close Deal with Majestic Investor in Q4
GENSYM: Q3 Net Loss Narrows to $900K After Restructuring Charges
HAYES LEMMERZ: S&P Concerned About Near-Term Liquidity Pressures
HMG WORLDWIDE: Files Chapter 11 Petition in S.D. New York
HMG WORLDWIDE: Case Summary & 30 Largest Unsecured Creditors
HOMESEEKERS.COM: HMI Initiates Insider Trading Investigation
I2 TECHNOLOGIES: Operating Losses Spurs S&P to Slash Ratings
IASIS HEALTHCARE: S&P Holds Low-B Ratings with Negative Outlook
IBEAM BROADCASTING: Court Okays Access to $6MM Under DIP Pact
ICG COMMS: Asks Court to Okay Sublease with Cylink & Orchard Jay
IMPERIAL SUGAR: James C. Kempner Will Take Helm As New CEO
INNOVEDA: Not in Technical Compliance with Fleet Loan Facility
INTEGRATED ELECTRICAL: S&P Revises Positive Outlook to Stable
LAIDLAW: Secures Okay to Amend D&O Defense Trust & Pay Costs
MARINER POST-ACUTE: MHG Wants More Time to Decided on Leases
MERCHANTONLINE: Files For Bankruptcy Protection in Florida
MIDWAY AIRLINES: Advises No Return for Stocks Under Any Plan
NIAGARA MOHAWK: Declares Dividends on Preferred Shares
ORBITAL SCIENCES: May File For Chapter 11 with Prearranged Plan
PACIFIC GAS: Assumes PPA with Ripon Cogeneration as Amended
PLANET HOLLYWOOD: Files Chapter 22 Petition in M.D. Florida
POLAROID: Court Okays Payment of $4MM Critical Vendors Claims
PRACTICEWORKS: Posts Q3 Net Loss of $8.3MM On $16.2M In Revenues
RELIANCE GROUP: Plan Filing Exclusivity Extended to February 7
REMINGTON PRODUCTS: S&P Affirms B Credit and CCC+ Debt Ratings
SAFETY-KLEEN: Seeks Approval of Indian Harbor Insurance Program
STONE ENERGY: S&P Keeps Watch On Ratings After Acquisition Deal
SWISSAIR: Deputy Chairman B. Hentsch Takes On New Group Duties
SWISSAIR: Group Cancels November 9 Shareholders' Meeting
TEXAS PETROCHEM: S&P Affirms Low-B's On Declining Credit Quality
TEXON INT'L: Poor Short-Term Liquidity Spurs S&P's Junk Rating
USG CORP: Asks Court to Approve Retention & Severance Programs
U.S. INDUSTRIES: Junk Ratings Remain On S&P Watch Positive
UNIQUE BROADBAND: Seeks to Add Former TSE President to Board
VIZACOM: Completes Restructuring of Over $1MM of Current Debts
WARNACO GROUP: Panel Wants More Time to Review Lenders' Liens
WEIRTON STEEL: CEO Says Recovery in Sight After ITC Ruling
WESTPOINT STEVENS: Denies Allegations in Class Action Lawsuit
WINSTAR COMMS: Battles with Savvis to Recoup $38.4M Receivables
* Meetings, Conferences and Seminars
*********
BETHLEHEM STEEL: Signs-Up Cravath As Special Corporate Counsel
--------------------------------------------------------------
Bethlehem Steel Corporation asks Judge Lifland for permission
to retain Cravath, Swaine & Moore as their special corporate
counsel, under a general retainer, to perform legal services
that will be necessary during these chapter 11 cases.
Leonard M. Anthony, Bethleham's Senior Vice President, Chief
Financial Officer and Treasurer, informs the Court that Cravath
has served as the Debtors general corporate counsel since 1904.
Thus, Mr. Anthony notes, it is undeniable that Cravath is very
familiar with the Debtors' financial structure, creditor
relationships, contractual relationships, and business
operations and affairs.
That's why, Mr. Anthony explains, the Debtors seek to retain
Cravath as special corporate counsel in connection with these
cases. In this role, Mr. Anthony says, Cravath will assist the
Debtors in finance, joint venture and other corporate
proceedings, as well as in various matters that may be litigated
before this Court or possibly in other forums. At the same
time, the Debtors expect Cravath to continue providing services
in connection with their general corporate legal needs as well
as other services, which may include litigation services.
Mr. Anthony assures the Court that Cravath will work closely
with Weil, Gotshal & Manges so that Cravath's knowledge and
experience with respect to the legal affairs of the Debtors can
be made available to the Debtors' bankruptcy counsel in this
case.
Since September 30, 2000, Mr. Anthony informs the Court that
Cravath has billed the Debtors $2,106,846 for pre-petition
services rendered and disbursements and other charges incurred,
and those bills were paid in full before the Petition Date.
The Debtors propose to pay Cravath its customary $120 to $625
hourly rates for attorneys and paralegals working on these
chapter 11 cases.
Cravath partner D. Collier Kirkham, Esq., notes that his
Cravath, as a large firm, has represented certain creditors and
parties-in-interest in these cases. But to the best of his
knowledge, Mr. Kirkham declares, Cravath has not represented any
of these entities in connection with matters relating to the
Debtors. Cravath neither has any adverse interest against the
Debtors, Mr. Kirkham adds.
In light of the extensive number of creditors and other parties-
in-interest, Mr. Kirkham admits that Cravath has not been able
to conclusively identify all such potential relationships.
However, Mr. Kirkham assures Judge Lifland that Cravath is
continuing its investigation in an effort to identify any other
such relationships. To the extent that Cravath becomes aware of
any additional relationships, Mr. Kirkland says he will file a
supplemental affidavit. (Bethlehem Bankruptcy News, Issue No. 2;
Bankruptcy Creditors' Service, Inc., 609/392-0900)
CELLSTAR: Must Raise Up to $150MM to Pay-Off Notes due Oct. 2002
----------------------------------------------------------------
CellStar Corporation (Nasdaq: CLST) announced that revenues for
the third quarter ended August 31, 2001, were $610.5 million,
compared to $629.8 million for the comparable quarter of fiscal
2000, and compared to $610.6 million from ongoing operations for
the comparable quarter last year. CellStar reported a net loss
for the quarter of $5.8 million, compared to a net loss of $13.9
million for the third quarter last year.
The Company also announced that it will restate the previously
released financial statements for the second quarter of fiscal
2001 to reduce the previously reported net income from $5.3
million to $3.6 million, or from $0.09 per diluted share to
$0.06 per diluted share.
While closing the accounts for the third quarter, the Company
determined that it had incorrectly recorded certain accounts
payable transactions in the second quarter related to one of the
Company's large carrier customers in Mexico. The error was the
result of a failure to adequately perform certain procedures
necessary to accurately account for transactions with the
customer. The inadequate performance of procedures resulted
from a second-quarter change in the accounting staff handling
the procedures for the Company's Mexico operations.
Additionally, and to a much lesser extent, the Company had
failed to accrue certain activation revenues during the second
quarter.
Excluding special items, net income for the third quarter of
2001 was $1.5 million, compared to a net loss of $3.7 million
from ongoing operations in the comparable prior-year quarter.
On an after-tax basis, the special items were: the retired
chairman and CEO's separation agreement ($4.3 million);
impairment of assets related to an investment in a Taiwan retail
customer ($1.7 million); reserve taken for a fire loss at a
third-party warehouse ($0.9 million); and accelerated
amortization of deferred loan costs ($0.4 million).
"We are pleased with the continued strong revenue growth in
China and with the growth of revenues in the North America
region over the first three quarters," said Terry Parker, Chief
Executive Officer. "The sound performance of our two largest
regions was substantially offset by disappointing results in
Latin America's recessionary economies and in Europe's heavily
saturated handset market. Clearly, we were very disappointed
with both the accounting errors discovered in our Mexico
operation and the resulting need to restate the Company's second
quarter financial results. However, we acted decisively,
specifically and as quickly as practicable to address the
accounting errors."
"Gross margin for the third quarter improved year-over-year and
we increased profitability from ongoing operations under
challenging industry conditions," Parker added. "In addition,
we recently increased our new revolving credit facility from $60
million to $85 million. The new facility is better suited to
our needs as a growing, global corporation. We look forward to
further improving our capital structure by completing the
exchange of our convertible debt."
"Also in the third quarter, we continued to improve key elements
of our balance sheet," said Dale Allardyce, President and Chief
Operating Officer. "Accounts receivable days sales outstanding
improved from 35 days last quarter to 32 days for the third
quarter, better than our target of 35 to 40 days. Inventory
turns improved from 11 times to 13, above our target range of 10
to 12. As a result, we generated $22.6 million in cash flow
from operations and reduced our cash conversion cycle by 13
percent, from 38 days to 33 days."
Form 10-Q Filing
Earlier Monday, the Company filed its Form 10-Q for the third
quarter in accordance with the previously announced extension
for filing. To comply with the Securities and Exchange
Commission filing deadline, the Company filed without its
independent auditors having completed their review procedures as
established by generally accepted accounting standards and will
issue a news release once the auditors have completed those
procedures.
Ongoing Operations
Ongoing operations for 2001 exclude separation costs related to
the retirement of the Company's founder, Chairman and CEO, an
impairment of assets charge related to an investment in a Taiwan
retail customer, a reserve for a fire loss at a third-party
warehouse, and accelerated amortization of deferred loan costs.
Ongoing operations for fiscal 2000 exclude results from divested
operations in Brazil and Venezuela.
Third-quarter revenues were $610.5 million, compared to $610.6
million for the prior-year quarter. Excluding revenues of $34
million in the prior-year quarter from a major account in North
America that has since been converted to a consignment basis,
revenues increased 5.9 percent in the current-year third
quarter. The People's Republic of China (PRC), including Hong
Kong, continued to be the Company's largest growth market.
Revenues increased $105.4 million, up 56.8 percent compared to
the prior-year quarter. Higher revenues resulting from the
increase in the PRC were offset by revenue decreases of $55.7
million in Taiwan, $36.7 million in Mexico, and $13.7 million in
Sweden.
Gross profit for the third quarter of fiscal 2001 was $31.1
million, an increase of $5.5 million, or 21.6 percent, over the
prior-year comparable quarter. Gross margin for the third
quarter of fiscal 2001 was 5.1 percent of revenues, compared to
4.2 percent in the prior-year comparable quarter due primarily
to better inventory management and product mix.
Selling, general and administrative expenses for the third
quarter of fiscal 2001 were $27.4 million, or 4.5 percent of
revenues, compared to $26.4 million, or 4.3 percent of revenues,
for the prior-year comparable quarter.
Revenues for the third quarter from sales of handsets were
$555.6 million, compared to $550.6 million for the third quarter
of fiscal 2000. Including consigned product, CellStar handled
4.7 million handsets in the third quarter of fiscal 2001
compared to 3.0 million in the prior-year comparable quarter.
Revenues for the third quarter from sales of accessories and
other products were $30.1 million compared to $37.1 million for
the third quarter of fiscal 2000. Activation, residual,
prepaid, fulfillment and other value-added service revenues
increased to $24.7 million compared to $22.9 million for the
third quarter of fiscal 2000.
The average selling price of handsets in the third quarter was
$147.39 compared to $180.19 in the preceding quarter. The
average selling price of a digital handset was $149.42 compared
to $183.26 in the preceding quarter. The average selling price
of an analog handset was $85.20 compared to $69.45 in the
preceding quarter. The decrease in overall average selling
price is due to changing product mix, lack of compelling new
high-end products and the normal decline in selling price of
established models as they advance through their product life-
cycle.
Interest expense in the third quarter was $2.9 million, compared
to $4.1 million in the prior-year comparable quarter, reflecting
lower levels of borrowing and lower interest rates. At August
31, 2001, the Company had $39.1 million of loans to support
operations in the PRC. The loans were collateralized by $40.6
million of restricted cash on deposit. Interest expense on
these loans was substantially offset by interest income on the
restricted cash.
Consolidated Balance Sheet
Accounts receivable were $199.4 million at the end of the third
quarter, compared to $219.4 million at the end of the second
quarter. Average accounts receivable days sales outstanding for
the quarter improved to 32 days compared to 35 days for the
preceding quarter and were better than the Company's target
range of 35 to 40 days.
Inventory at the close of the third quarter was $195.4 million
compared to $165.9 million at the end of the second quarter to
support a higher level of sales in the third quarter and
anticipated revenue growth in the fourth quarter. Annualized
inventory turns improved to 13 times for the third quarter
compared to 11 times for the preceding quarter and were better
than the Company's targeted range of 10 to 12 turns.
As a result of the improvements in receivables and inventory,
the Company generated cash flow from operations of $22.6 million
and reduced the cash conversion cycle from 38 days to 33 days.
Liquidity
Cash, cash equivalents, and restricted cash for the quarter were
$97.8 million, compared to $85.5 million at the end of the
preceding quarter. On September 28, 2001, the Company closed a
new, $60 million, five-year revolving credit facility with an
interest rate equal to the prime rate plus one percent. On
October 12, 2001, the amount of the facility was increased to
$85 million. The new facility provides greater flexibility in
funding foreign operations and a more extensive borrowing base
with more flexible financial covenants. There have been no
borrowings under either the previous revolving credit facility
or the new facility since August 20, 2001.
On September 4, 2001, the Company filed a registration statement
with the Securities and Exchange Commission (SEC) proposing to
exchange up to 60,142,221 shares of its common stock and up to
$20 million in cash for up to the full $150 million of its
outstanding 5% Convertible Subordinated Notes due October 2002.
Assuming the Company is able to successfully complete the
exchange offer, the Company anticipates that its cash flow from
operations, based on current and anticipated levels of
operations and aggressive efforts to reduce inventories and
accounts receivable, together with amounts available under its
new credit facility and existing unrestricted cash balances,
will be adequate to meet its anticipated cash requirements for
the foreseeable future.
The Company's new credit facility requires that the Company
refinance, exchange or extend the maturity of at least 80% of
the principal amount of the Notes by April 2002, and failure to
do so would result in an event of default under the facility.
As disclosed in the Company's Form S-4 registration statement
filed with the SEC on September 4, 2001, if the Company is
unable to successfully complete the exchange offer or otherwise
refinance or pay off the Notes, it may be faced with the
possibility of bankruptcy, because its anticipated cash flow
from operations, unrestricted cash balances and available
borrowings may be insufficient to meet its cash requirements,
including the payment of the Notes.
Ongoing Regional Operations
Asia-Pacific: Asia-Pacific Region revenues increased 22.5
percent in the third quarter to $331.7 million compared to
$270.8 million in the prior year and were 54 percent of total
revenues. The PRC, including Hong Kong, accounted for revenues
of $291.0 million, 56.8 percent higher than last year's third
quarter. Market penetration of handsets in the PRC is
approximately 10 percent of the total population and growth is
driven primarily by the addition of new wireless subscribers.
To support growth in the PRC, CellStar has continued to expand
its network of retail customers. Revenues in Singapore
increased by $11.9 million, while revenues in Taiwan declined by
$55.7 million due to political and economic uncertainty, lack of
compelling new products, and the loss of a major customer.
North America: Revenues for the third quarter in the North
America Region were $155.6 million compared to $155.7 million
for the comparable prior-year period and were 26 percent of
total revenues for the quarter. Excluding revenues of $34
million in the prior-year quarter from a major account that has
since been converted to a consignment basis, revenues increased
27.9 percent in the current-year third quarter. The conversion
reduced revenues this year, but also lowered inventory risk and
the need for working capital.
In the North America Region, where industry handset sales are
generally projected to be flat or down for the year, revenues
were up 21.2 percent on a non-adjusted basis for the first three
quarters of fiscal 2001 compared to the first three quarters of
fiscal 2000. Excluding handset revenue generated by the account
that has been converted to consignment, revenues were up 32.2
percent year-to-date in fiscal 2001 compared to the same period
in fiscal 2000. Growth in the North America Region was
influenced by the rollout of new markets by a major one-rate,
all-you-can-talk regional carrier customer and the continued
expansion of the Company's dealer/agent customer base.
Latin America: Latin America Region revenues were $69.5 million
for the third quarter, 11 percent of the Company's total
revenues, compared to prior- year quarter revenues of $117.4
million. Revenues in Mexico, the region's largest revenue
contributor, were $41.5 million compared to $78.2 million in the
previous year's comparable quarter, reflecting slower economic
growth as well as lower sales to its major carrier customers.
Revenues from the Company's Miami export operations were $14.3
million compared to $20.5 million in the third quarter a year
ago.
Europe: Revenues for the Europe Region were $53.6 million for
the third quarter, or 9 percent of total revenues, compared to
$66.7 million in the prior-year comparable quarter due largely
to reduced revenue in Sweden, where handset sales declined while
average selling prices fell due to sales of low- end handsets.
The handset market in Europe is highly penetrated and is
increasingly driven by replacement handset sales, which are
depressed due to delays in the rollout of new handset
technologies and services.
CellStar Corporation is a leading global provider of
distribution and value-added logistics services to the wireless
communications industry, with operations in Asia-Pacific, North
America, Latin America and Europe. CellStar facilitates the
effective and efficient distribution of handsets, related
accessories and other wireless products from leading
manufacturers to network operators, agents, resellers, dealers
and retailers. In many of its markets, CellStar provides
activation services that generate new subscribers for its
wireless carrier customers. For the year ended November 30,
2000, the Company generated revenues of $2.5 billion.
Additional information about CellStar may be found on its Web
site at http://www.cellstar.com
COMDISCO INC: DOJ Files Suit to Block SunGard Acquisition
---------------------------------------------------------
SunGard (NYSE:SDS) dismissed the U.S. Department of Justice's
complaint challenging SunGard's acquisition of the Availability
Solutions business of Comdisco, Inc. (NYSE:CDO) as baseless and
ill-advised and vowed to vigorously defend the transaction.
The Justice Department filed suit Monday in the U.S. District
Court for the District of Columbia against SunGard and Comdisco
in an attempt to block the acquisition.
SunGard officials said they are prepared to proceed quickly with
the case and will ask the court to rule on the Justice
Department's motion for a preliminary injunction well in advance
of the December 5, 2001 termination date in SunGard's
acquisition agreement with Comdisco.
SunGard's purchase of Comdisco's Availability Solutions business
for $825 million in cash was approved by Comdisco and fully
supported by the Official Committee of Unsecured Creditors and
Official Equity Committee at the auction conducted on October
11, 2001 pursuant to an order of the United States Bankruptcy
Court for the Northern District of Illinois.
James L. Mann, chairman and chief executive officer of SunGard,
said, "We believe that the government's case is without merit,
and we look forward to proving that in court. This transaction
is procompetitive, since it will assure that there is a strong
independent business continuity vendor to compete against the
hardware giants with enhanced services and reduced costs.
Customers will have access to more facilities, equipment,
network capacity and experienced personnel, in more locations
and with greater redundancy. SunGard is known for providing the
best service at the lowest price, and that will not change. We
understand this business better than anyone and are best
positioned to achieve significant operational efficiencies after
closing. These are just some of the reasons why the SunGard-
Comdisco combination has garnered widespread customer support
and why we expect to prevail in court."
Mann added, "We also believe that, in light of the recent
attacks on America's infrastructure, it is contrary to public
policy for the government to oppose a transaction that obviously
will strengthen the ability of SunGard and Comdisco to service
the nation's disaster recovery needs. Now more than ever, our
country needs a vital and capable business continuity industry.
With Comdisco in bankruptcy and its Availability Solutions
division continuing to support companies devastated by the
terrible events of September 11th, a prompt resolution of this
antitrust challenge is critical."
SunGard (NYSE:SDS) is a global leader in integrated IT solutions
and eProcessing for financial services. SunGard is also the
pioneer and a leading provider of high-availability
infrastructure for business continuity.
With annual revenues in excess of $1 billion, SunGard serves
more than 20,000 clients in over 50 countries, including 47 of
the world's 50 largest financial services institutions. Visit
SunGard at http://www.sungard.com
CONOCO CANADA: Plummets Into Red in Q3 After Restructuring
----------------------------------------------------------
Conoco Canada Resources Limited, formerly known as Gulf Canada
Resources Limited, announced its results for the third quarter
of 2001.
The company reported a third quarter loss of $353 million, in
comparison to earnings of $43 million in the third quarter of
2000.
The financial restructuring that the company undertook
significantly contributed to the loss as result of premiums paid
to induce investors to sell their bonds back to the company and
a write off of remaining deferred charges. The early retirement
of long-term debt will result in lower finance charges on a
going forward basis.
Total cash generated was a negative $39 million for the quarter,
also a result of the debt restructuring.
Year to date cash generation is $861 million, an increase of
$174 million compared to the first nine months last year. Sales
volumes before royalty for the quarter averaged 252,100 barrels
of oil equivalent per day, up 47 percent over the third quarter
of 2000 largely as a result of the November 2000 acquisition of
Crestar.
Conoco Canada Resources Limited's preference shares trade on the
TSE under the ticker symbol CNK.PR.A. All of the ordinary shares
of the company are owned by Conoco Northern Inc., an indirect
wholly-owned subsidiary of Conoco Inc (NYSE:COC).
Conoco is a major, integrated energy company active in more than
40 countries.
DANKA BUSINESS: Selling NZ Assets to Minolta to Reduce Debt
-----------------------------------------------------------
Danka Business Systems PLC (Nasdaq:DANKY) announced that it has
entered into an Agreement to sell certain assets of its New
Zealand subsidiary, Danka New Zealand Limited, to Minolta New
Zealand Limited.
Under the terms of the sale, Minolta will pay approximately $1.2
million, for the assets, which will be offset by Danka's
retention of certain trade payables. Danka will also retain
certain accounts receivable. Danka will use the net proceeds of
the sale to reduce debt under its newly executed Senior Bank
Credit Facility. The sale is expected to close on or about
November 2, 2001.
David Berg, Chief Operating Officer of Danka's Canada, Latin
America and Asia Pacific Regions, stated: "This disposition is
consistent with the Company's strategic mission to dispose of
non-performing assets. Danka New Zealand is in the unenviable
position of competing against the manufacturer of its products
in New Zealand and was maintaining insufficient market share.
The operation constituted a drain on the Company's Australian
business, on which we will be able to devote more attention and
focus to ensure its continued operational improvement. I am
certain the business will prove much more strategic to Minolta
than to Danka."
Danka's Chief Executive Officer, Lang Lowrey, added: "The
Company continues to divest itself of assets, like the New
Zealand business, which have had a negative operational impact
on the overall Company. It simply made no sense for Danka to
remain in this market. We are pleased with the terms of this
transaction and believe it will be a win for both Danka and
Minolta, as well as for the customers. We will continue to
evaluate all opportunities for further debt reduction and
enhanced performance."
Danka Business Systems, PLC, headquartered in London, England,
and St. Petersburg, Florida, is one of the world's largest
independent suppliers, by revenue, of office imaging equipment
and related services, parts and supplies. Danka provides office
products and services in 30 countries around the world.
DERBY CYCLE: Completes Issuance of DM$15.3MM DM Notes to Lyon
-------------------------------------------------------------
On September 27, 2001, The Derby Cycle Corporation and Lyon
Investments B.V. completed their previously announced offer to
purchase a portion of their 10% Senior Notes Due 2008. On the
same date, Lyon also completed its previously announced offer to
purchase, on behalf of the Issuers, a portion of the Issuers' 9-
3/8% Senior Notes Due 2008.
Pursuant to the terms of the USD Offer, the Issuers' have
purchased US$14,171,000 principal amount of USD Notes for a
purchase price equal to 100% of the principal amount thereof
plus accrued interest. Pursuant to the terms of the DM Offer,
Lyon has purchased DM15,318,000 of DM Notes for a purchase price
equal to 100% of the principal amount thereof plus accrued
interest.
As a result of the purchases, the aggregate principal amount of
the USD Notes that remain outstanding is US$85,829,000 and the
aggregate principal amount of the DM Notes that remain
outstanding is DM94,682,000.
EXODUS COMMS: US Trustee Appoints Official Creditors' Committee
---------------------------------------------------------------
Roberta A. DeAngelis, an Assistant United States Trustee for
Region III, invited the Debtors' largest unsecured creditors to
a meeting for the purpose of organizing one or more official
committees in Exodus' chapter 11 cases. Ms. DeAngelis
determined that one seven-member committee will represent the
interests of the Debtors' unsecured creditor population.
Accordingly, pursuant to 11 U.S.C. Sec. 1102(a)(1), the
creditors appointed to serve on the Official Committee of
Unsecured Committee are:
HSBC Bank USA
Attn: Robert Conrad
10 East 40th Street
New York, NY 10016-0200,
Phone: (212) 525-1314
Fax: (212) 525-1300;
Legg Mason Investment Trust, Inc.
Attn: Jennifer W. Murphy
100 Light Street, 22nd Floor
Baltimore, MD 21202
Phone: (410) 454-5315
Fax: (410) 454-3296;
HY Investments, LLC
Attn: William Pate
2 N. Riverside Plaza
Chicago, IL 60606
Phone: (312) 466-3805
Fax: (312) 559-1280;
Creedon Capital, LLP
Attn: Paul Giordano
123 2nd Street
Sausalito, CA 94965,
Phone: (415) 332-0111
Fax: (415) 332-7811;
Aristeia Capital, LLC
Attn: Kevin Toner
383 Fifth Avenue
New York, NY 10016
Phone: (212) 842-8900
Fax: (415) 842-8901;
Nova Corp.
Attn: Mark DiStefano
74 W. Sheffield Avenue
Englewood, NJ 07631
Phone: (201) 567-4404
Fax: (201) 567-1927
ISR Solutions, Inc.
Attn: Bruce K. Gouldey
14120 Parke Long Ct., Suite 206
Chantilly, VA 20151
Phone: (703) 679-9333
Fax: (703) 679-9330
Frank J. Perch, III, Esq., is the staff attorney for the U.S.
Trustee's office assigned to Exodus' chapter 11 cases. (Exodus
Bankruptcy News, Issue No. 4; Bankruptcy Creditors' Service,
Inc., 609/392-0900)
FEDERAL-MOGUL: Seeks to Waive Sec. 345 Investment Requirements
--------------------------------------------------------------
Pursuant to 11 U.S.C. Sec. section 345(b), any deposit or other
investment made by a debtor, except those insured or guaranteed
by the United States or by a department, agency or
instrumentality of the United States or backed by the full faith
and credit of the United States, must be secured by a bond in
favor of the United States or by the deposit of securities.
Section 345(b) provides further, however, that a bankruptcy
court may allow the use of alternatives to these approved
investment guidelines "for cause."
By its motion, Federal-Mogul Corporation seeks:
A. authority to invest and deposit funds in a safe and prudent
manner in accordance with the Credit Agreement,
notwithstanding that such investments may not strictly
comply in all respects with strictures of of the Bankruptcy
Code; and
B. that applicable institutions be authorized and directed to
accept and hold or invest such funds in accordance with the
Credit Agreement.
As part of the Cash Management System, David M. Sherbin, the
Debtors' Vice president and Deputy General Counsel, tells the
Court that the Debtors use numerous bank depository and
disbursement accounts, as well as certain investment accounts.
The Debtors' investment of excess cash has been dictated for the
most part by the requirements of the December 29, 2000 Credit
Agreement, Mr. Sherbin explains, pursuant to which the funds are
wired to certain investment accounts at Bank One when excess
cash remains in the Concentration Account at the end of
business. In addition, the Debtors are allowed to keep a maximum
of $25,000,000 in the Bank One Accounts, including the
Concentration Account.
Mr. Sherbin relates that the Debtors can choose to invest some
or all of these funds provided that if the total balance in
those accounts exceeds $25,000,000, then the excess must be
placed in an investment account. For the first $20,000,000 that
the Debtors intend to invest, Mr. Sherbin explains that the
Debtors can choose to invest in a Bank One Money Market Fund or
in the Bank One investment account for which Wilmington Trust
Company serves as fund trustee.
If the Debtors intend on investing more than $20,000,000, then
the excess over $20,000,000 must be invested in the Wilmington
Account. These accounts both provide interest at a daily rate
based on the Federal Funds rate less 50 basis points, Mr.
Sherbin says, and are relatively low-risk investments.
Mr. Sherbin informs the Court that the Debtors' depository and
disbursement accounts with balances in excess of $5,000 are all
held at financial institutions with a Moody's Rating of "Al" or
better. The Debtors will monitor monthly the Moody's ratings of
all Debtors' banks with account balances in excess of $5,000 and
will advise the Court if any such rating drops below a "Bad"
rating by Moody's. Additionally, the Debtors will insure that
any new accounts that are opened post-petition will be with
banks that have achieved a rating of "A" or better.
Laura Davis Jones, Esq., at Pachulski Stang Ziehl Young & Jones,
P.C., in Wilmington, Delaware, states that the Debtors are
extremely large, complex and sophisticated organizations that
are financially connected through a structured and efficient
Cash Management System and which possesses ample ability to
transfer funds between accounts as needed to ensure the safety
of the funds. Furthermore, the Debtors investment activities are
dictated to a large degree by their major secured lenders whose
interest is ensuring that the Debtors' assets are not
dissipated.
Consequently, the Debtors assert that sufficient cause exists to
waive the requirements in this case. Ms. Jones asserts that
Courts have routinely granted requests for approval of the
continued use of investment and deposit guidelines that do not
comply strictly with Sec. 345 of the Bankruptcy Code but that
are nevertheless safe and prudent. (Federal-Mogul Bankruptcy
News, Issue No. 3; Bankruptcy Creditors' Service, Inc., 609/392-
0900)
FITZGERALDS GAMING: To Close Deal with Majestic Investor in Q4
--------------------------------------------------------------
The Majestic Star Casino, LLC announced operating results for
the three and nine month periods ended September 30, 2001.
During the three month period ended September 30, 2001, the
Company had net revenues of $31.6 million compared to $28.8
million for the same period last year, an increase of
approximately $2.7 million or 9.4%.
Net loss for the three month period ended September 30, 2001 was
$449,000, compared to a net loss of $2.1 million in the same
period last year, an improvement of 79.0%. Adjusted EBITDA
(earnings before interest, taxes, depreciation, amortization,
loss on bond redemption, loss on disposal of assets and costs
associated with its "unrestricted subsidiary" Majestic Investor,
LLC) was $6.4 million compared to $5.1 million in the prior
year. The $1.3 million or 24.7% increase in Adjusted EBITDA was
primarily attributable to a 12.1% increase in slot revenues.
As of September 30, 2001, the Company had year-to-date net
revenues for the nine month period of approximately $95.9
million, compared to $89.9 million in same period last year, an
increase of approximately $6.0 million or 6.7%. The Company's
year-to-date EBITDA was $19.8 million, compared to $17.1 million
during the same period last year. The $2.6 million 15.4%
increase in EBITDA is attributable to the strong double digit
growth in slot revenues and a 4.0% increase in the number of
admissions and an 8.3% overall decrease in advertising
expenditures.
Casino revenues during the three months ended September 30, 2001
totaled approximately $30.9 million, of which slot machines
accounted for approximately $26.2 million (84.8%) and table
games accounted for approximately $4.7 million (15.2%). Slot
coin-in increased $21.9 million and slot revenue increased $2.8
million or 12.1% compared to the same period last year.
The average number of slot machines in operation was 1,424 with
an average win per slot per day of $200, compared to 1,432 units
with an average win per slot per day of $175 in the period ended
September 30, 2000. The average number of tables in operation
was 49 with an average win per table per day of $1,043. The
Company's admissions during the quarter grew 4.0% over the same
period last year to 820,000. The average win per state
passenger count was approximately $38 and the average win per
patron was approximately $66.
Casino revenues during the nine month period ended September 30,
2001 totaled approximately $93.8 million compared to $87.9
million in the prior year, an increase of approximately $5.9
million or 6.7%. The average win per slot per day was $203
compared to $180 in the same period last year. The average win
per state passenger count was approximately $38 and the average
win per patron was approximately $68.
The Company also stated that construction of a 2,000 space
parking facility by Buffington Harbor Parking Associates, LLC
(BHPA) a joint venture between Trump Indiana, Inc and AMB
Parking LLC (a company wholly owned by Don H. Barden) is well
underway. Michael Kelly, Chief Operating Officer stated "that
the majority of the foundation supporting the structure has been
poured and that the erection of the pre-fabricated structure has
begun in earnest." Mr. Kelly went on to state "that at the
present time the general contractor appears to be running
slightly ahead of schedule and the parking facility is on target
to be completed late first quarter or early second quarter
2002."
Majestic Investor, LLC was formed in September 2000 as an
"unrestricted subsidiary" of the Company under the Indenture
relating to the Company's 10-7/8% Senior Secured Notes.
Majestic Investor was initially formed to satisfy the Company's
offsite development obligations under a Development Agreement
with the City of Gary. The Company has met and satisfied all of
its financial obligations under the Development Agreement.
On November 22, 2000, Majestic Investor entered into a
definitive purchase agreement with Fitzgeralds Gaming
Corporation to purchase three Fitzgeralds brand casinos.
Majestic Investor in September 2001 assigned its rights to
Majestic Investor Holdings, LLC, a 100% owned affiliate of
Majestic Investor, LLC. Majestic Investor Holdings, LLC plans
to purchase Fitzgeralds casinos in Las Vegas, Nevada, Tunica,
Mississippi, and Black Hawk, Colorado for approximately $149
million in cash, subject to adjustment in certain circumstances,
plus the assumption of certain liabilities.
The sale is consistent with the reorganization that Fitzgeralds
Gaming Corporation has negotiated with a committee representing
its noteholders. To facilitate this transaction, Fitzgeralds
Gaming Corporation and its subsidiaries voluntarily filed for
Chapter 11 Bankruptcy in U. S. District Court in Nevada on
December 5, 2000.
The sale of these properties to Majestic Investor was approved
by the Bankruptcy Court on March 19, 2001, but still remains
contingent on, among other things, licensing and financing. Don
H. Barden, Chairman and CEO of Majestic Star and its affiliated
subsidiaries, including Majestic Investor Holdings, LLC stated
"that the Company received regulatory approvals to purchase and
operate the three Fitzgeralds brand properties from Mississippi,
Colorado and Nevada the week of October 15, 2001." Mr. Barden
also stated "that the Company has filed and received appropriate
approvals from the Federal Trade Commission with respect to the
Hart-Scott-Radino Act." The Company anticipates that the
transaction, pending financing should close during the fourth
quarter of 2001.
The Company also reported that September 30, 2001 was its
outstanding approximately $132.5 million. The Company ended the
quarter with cash and cash equivalents of approximately $8.4
million, which amount excludes $4.9 million in cash and
restricted cash at Majestic Investor.
The Company was formed in December 1993 as an Indiana limited
liability company to provided gaming and related entertainment
to the public. The Company began operations on June 7, 1996.
Through October 27, 1997, the Company conducted its operations
onboard a Chartered Vessel. On October 27, 1997 the Company
placed into service a $50.1 million permanent vessel which is
owned by the Company and contains approximately 43,000 square
feet of gaming on three expansive levels with approximately
1,423 slot machines and 49 table games.
The Company and Trump Indiana, Inc., the holder of a second
gaming license to operate in the City of Gary, formed Buffington
Harbor Riverboats, L.L.C. to own and operate certain common
facilities at Buffington Harbor, such as the guest pavilion,
vessel berths, parking lots and other infrastructures. The
Company and Trump each have a fifty-percent ownership interest
in BHR.
GENSYM: Q3 Net Loss Narrows to $900K After Restructuring Charges
----------------------------------------------------------------
Gensym (OTC Bulletin Board: GNSM), a leading provider of
software and services for expert operations management, reported
revenues of $5.0 million and an operating profit of $0.2
million, before a charge for restructuring, for its third
quarter ended September 30, 2001. Including a third quarter
restructuring charge of $0.8 million and other non-operating
expenses of $0.2 million, the net loss for the third quarter of
2001 was $0.9 million. In the third quarter of 2000, Gensym had
revenues of $5.5 million and a net loss of $5.5 million.
"I am pleased to report an operating profit, excluding
restructuring and other non-operating expenses, for the quarter
just ended, the first such positive result for the company since
the third quarter of 1999," said Lowell Hawkinson, Gensym's
chairman, president, and CEO. "Operating profitability was
achieved in spite of the disrupting influences of a change of
management, a change in company strategy, a 50% headcount
reduction, exceptionally high legal and accounting expenses,
worsening economic conditions, and the business aftershock of
the September 11 terrorist attacks. Even with Gensym's major
downsizing and a 44% quarter-to-quarter reduction in sales and
marketing expenses, revenues in the third quarter were almost
the same as those of the second quarter. Particularly
encouraging on the revenue side was the record high level, for a
third quarter, of software maintenance renewals. Gensym's change
in strategy to focus on its existing base of end users and
partners and on its established products has met with a positive
response in the market."
"Looking ahead," Mr. Hawkinson continued, "we anticipate
operating profitability, excluding one-time charges, for the
fourth quarter of 2001 and throughout 2002. Revenues for the
fourth quarter are expected to be close to the level of the
three preceding quarters, while expenses should continue to
decrease, due primarily to headcount reductions made during the
third quarter and expected to be made in conjunction with the
recently announced sale of the NetCure product line."
The Company's balance of cash and marketable securities as of
September 30, 2001 was approximately $1.3 million, compared to
$1.4 million on June 30, 2001.
Gensym Corporation -- http://www.gensym.com -- is a provider
of software products and services that enable organizations to
automate aspects of their operations that have historically
required the direct attention of human experts. Gensym's product
and service offerings are all based on or relate to Gensym's
flagship product G2, which can emulate the reasoning of human
experts as they assess, diagnose, and respond to unusual
operating situations or as they seek to optimize operations.
With G2, organizations in manufacturing, communications,
transportation, aerospace, and government maximize the
performance and availability of their operations. For example,
Fortune 1000 manufacturers such as ExxonMobil, DuPont, LaFarge,
Eli Lilly, and Seagate use G2 to help operators detect problems
early and to provide advice that avoids off-specification
production and unexpected shutdowns. Manufacturers and
government agencies use G2 to optimize their supply chain and
logistics operations. And communications companies such as AT&T,
Ericsson Wireless, and Nokia use G2 to troubleshoot network
faults so that network availability and service levels are
maximized.
Gensym has numerous partners who can help meet the specific
needs of customers. Gensym and its partners deliver a range of
services, including training, software support, application
consulting and complete solutions. Through partners and through
its direct sales force, Gensym serves customers worldwide.
Gensym and G2 are registered trademarks of Gensym Corporation.
* * *
Gensym has obtained bridge loan financing of approximately $1.0M
to meet present cash needs from a group of investors consisting
of a Gensym partner and eight individuals, including a Gensym
founder and all of the members of its board of directors.
The bridge financing is a component of a larger commitment made
by these investors to participate as standby purchasers in the
previously announced rights offering in which Gensym expects to
raise equity capital from its shareholders and vested option
holders.
HAYES LEMMERZ: S&P Concerned About Near-Term Liquidity Pressures
----------------------------------------------------------------
Standard & Poor's lowered its ratings on Hayes Lemmerz
International Inc. At the same time, the ratings remain on
CreditWatch with negative implications where they were placed
September 5, 2001.
The company's debt as of April 30, 2001, totaled about $2.0
billion.
The ratings action reflects Standard & Poor's concerns about the
company's future operating performance, near-term liquidity, and
the magnitude of restatements related to ongoing investigations
into accounting errors. On September 5, 2001, Hayes announced
that it would restate certain historical financial statements to
correct accounting errors and to write down the value of
impaired assets. The accounting errors led to the understatement
of net losses of at least $14.7 million and $5.0 million during
fiscal 2000 and the first quarter of fiscal 2001, respectively.
EBITDA was overstated by at least $21 million and $9 million
during the same periods. The investigation into the accounting
errors is continuing and Standard & Poor's is increasingly
concerned that the magnitude and scope of the restatement will
exceed original expectations. It is unclear what level of
earnings and cash flow generation are achievable for the
company.
Access to the Hayes' bank credit facilities remains restricted
following financial covenant violations, which could lead to
increased liquidity pressures in the near term, limiting the
company's ability to take necessary steps to improve its
operating performance. Hayes continues to be challenged
by reduced automotive production, ongoing pricing pressure, the
uncertain outlook for automotive demand given the weak U.S.
economy, and a heavy debt burden and high capital investment
requirements.
Standard & Poor's will meet with management to review the extent
of the accounting errors and evaluate the company's corrective
action plans. The ratings on Hayes could be lowered if it
appears the company's operating performance will remain weak or
if liquidity will be constrained for an extended period.
Ratings Lowered, on CreditWatch Negative
Hayes Lemmerz International Inc. TO FROM
Corporate credit rating B- B+
Senior secured debt rating B- B+
Senior unsecured debt rating CCC B-
Subordinated debt rating CCC B-
HMG WORLDWIDE: Files Chapter 11 Petition in S.D. New York
---------------------------------------------------------
HMG Worldwide Corporation (Nasdaq:HMGC), along with certain of
its subsidiaries, voluntarily filed for protection under Chapter
11 of the U.S. Bankruptcy Code with the U.S. Bankruptcy Court
for the Southern District of New York. The Company intends to
utilize the Chapter 11 process to develop and implement a
reorganization plan.
The purpose of any reorganization plan would be to provide the
Company with improved financial flexibility. The Company intends
to seek Debtor-in-Possession financing to enable it to complete
the process of exiting the manufacturing portions of its
businesses and reorganize as a service company focused on adding
value to the in-store marketing efforts of mass retailers and
branded consumer manufacturers through its marketing, design,
engineering, and project management core competencies. The
Company will seek to implement a new outsourcing business model
relying on a Manufacturing and Distribution Agreement with
Leggett & Platt (NYSE:LEG - news) along similar lines to the
agreement announced on August 20, 2001.
HMG has hired Getzler & Co., Inc., a management consultant, to
help supervise the reorganization of the company. Mr. Mark
Samson, Senior Vice President for Getzler, will be leading this
effort as he takes on the role of Chief Reorganization Officer
for HMG during the ensuing months.
Any plan of reorganization must be confirmed by the Bankruptcy
Court following a vote on such plan by certain creditors and
stockholders. HMG has not yet submitted a plan.
Headquartered in New York City with operations in Reading,
Pennsylvania, Chicago and Toronto, HMG Worldwide Corporation has
spent the past 35 years committed to creating in-store
merchandising programs for many of the world's largest consumer
goods manufacturers and retailers, including Walgreens, CVS,
Wal-Mart, Kmart, Target, Home Depot, Lowes, Procter & Gamble,
Nestle, Chanel, Krispy Kreme, Bristol-Meyers Squibb, Sony,
Microsoft, Walden Books, Just For Feet, Sara Lee Foods, L'eggs
(invented original ``egg' displays), Pillsbury, Astoria Federal
Bank, and many others. Through the unique integration of point-
of-purchase marketing services and traditional and digital
design services, HMG provides its clients with insights,
solutions and opportunities that create results wherever
purchase decisions are made.
For more information, visit the Company's Web site at
http://www.hmgworldwide.com
HMG WORLDWIDE: Case Summary & 30 Largest Unsecured Creditors
------------------------------------------------------------
Lead Debtor: HMG Worldwide Corporation
475 Tenth Avenue - 12th Floor
New York, NY 10018
aka HMG
aka HMG Worldwide
aka HMG in-Store
Chapter 11 Petition Date: October 23, 2001
Court: Southern District of New York
Bankruptcy Case No.: 01-42642-smb
Debtor affiliates filing separate chapter 11 petitions:
Entity Case No.
------ --------
HMG Worldwide In-Store 01-42643
Marketing, Inc.
HMG Schultz International, 01-42644
Inc.
HMG/Intermark Worldwide 01-42645
Manufacturing, Inc.
Display Depot, Inc. 01-42646
HMG Griffith, Inc. 01-42647
HMG Manufacturing and 01-42648
Distribution, Inc.
Type of Business: The Debtor engages primarily in identifying
in-store, retail-based marketing objectives of
its clients and integrating research, creative
design, engineering, production, package
design and related services to provide point-
of purchase merchandising fixtures and display
systems. The Debtor's operations are conducted
principally through its five operating wholly
owned subsidiaries.
Judge: Stuart M. Bernstein
Debtors' Counsel: Ira L. Herman, Esq.
Robinson Silverman et al.,
1290 Avenue of the Americas
New York, NY 10104
Tel: (212) 541-1101
Fax: (212) 541-4630
Total Assets: $34,542,000
Total Debts: $61,946,000
List of Debtors' 30 Largest Unsecured Creditors:
Entity Nature Of Claim Claim Amount
------ --------------- ------------
Societe General Debentures $2,700,000
Financial Square
25th Floor
New York, NY
MODAN Associates Debentures $2,000,000
c/o Daniel Strauss
411 Hackensack Avenue
Hackensack, NJ 07601
Omnicom Group, Inc. Promissory Note $1,640,473
437 Madison Avenue
New York, NY 10022
C&K Plastics Inc. Trade $1,179,336
Robert Carrier
159 Liberty Street
Metcuhen, NJ 08840
(732) 549-0011 ext. 203
Falcon Industries Inc. Trade $875,901
Vic Michaelski
371 Campus Drive
Sommerset, NJ 08873
(732) 563-9889
Colonie Plastics Corp. Trade $842,482
188 Candlewood Road
Bay Shore, NY 11706
Jet Lithocolor Inc. Trade $831,530
Rick Rohre
1500 Center Circle
Downes Grove, IL 60679
(630) 932-6364
Jackson Rollforming Inc. Trade $750,856
Alex Trink
145 Dixon Avenue
Amityville, NY 11701
(631) 842-7775
L&P Financial Services Trade $725,277
Comp
Wholsale L/B Tram 41-5 Oper
St. Louis, MO 63101-1200
Technical Traffic Trade $724,964
Consultant
445 Rte. 304
Bardonia, NY 10954-1965
Progressive Manufacturing Trade $675,346
Co.
Daniel Spielter
116-132 Sussex Avenue
Newark, NJ 07103
(973) 622-6800
National Display Group Trade $577,789
6850 River Road
Pennsauken, NJ 08110
Jamison Plastic Corp. Trade $529,387
Nathan Dandora
4001 Crackersport Road
Allentown, PA 18104
(215) 287-7464
Procter & Gamble Trade $527,000
PO Box 701
Cincinnati, OH 45201
NYF Corp/Capital Trade $466,923
Fasteners
Doreen Remmer
PO Box 34202
Newark, NJ 07189-0202
(201) 265-8770
Sommer Metalcraft Corp. Trade $462,575
Paul Mochling
315 Poston Drive
Crawfordsville, IN 47933
(800) 654-3124
Anfinsen Plastic Molding Trade $395,365
Inc./Anf. Assemb
195 Farmsworth Avenue
Aurora, IL 60605
M&E Components, Inc. Trade $374,289
20654 S. Amherst Court
Joliet, IL 60433
McBride Properties Trade $354,890
c/o Keystone Property
Trust
Conshohocken, PA 19428
Spartek Inc. Trade $318,669
Dick Kledrowski
300 Milwaukee Avenue
Sparta, WI 54656
(608) 269-3154
Preferred Packaging Corp. Trade $292,918
Mark Maurer
113 East Centre Street
Nutley, NJ 07110
(973) 667-5000
Montrose Molders Trade $265,216
PO Box 265
S. Plainfield, NJ 07080
New York Metal Molding Trade $243,694
Co., Inc.
Kelly Temporary Services Professional Fees $242,915
King Shipping, Inc. Trade $232,689
Friedman Alpren & Green Professional Fees $203,857
Curbell Incorporated Trade $202,017
Crownlite Mfg Corp Trade $196,991
Panel Processing Inc. Trade $192,770
Madan Plastics Inc. Trade $187,017
HOMESEEKERS.COM: HMI Initiates Insider Trading Investigation
------------------------------------------------------------
HomeSeekers Management, Inc., a privately held concern and
successor in interest to debt instruments and liens issued to
E-Home.com, Inc. d/b/a HomeMark by HomeSeekers.com, issues the
following statement regarding its relationship with
HomeSeekers.com, Incorporated (OTC Bulletin Board: HMSK), a
leader in online real estate technology and services.
HMI and its predecessor have recently learned about the
historical, selective disclosure of material information by
HomeSeekers. In the past, such information evidently has been
disclosed in advance to selected investors and others, before
making full disclosure of the same information to the general
public. Selective disclosure is like ordinary "tipping" and
insider trading. In both cases, a privileged few gain an
informational edge -- and the ability to use that edge to profit
-- from their superior access to corporate insiders, rather than
from their skill, acumen or diligence.
It has become apparent over the past few weeks that the practice
of selective disclosure by HomeSeekers was indigenous and a
standard business practice. HMI believes this to be the case
because of the recent voluminous phone calls to it and its
predecessor seeking information and access to material non-
public information possessed by HMI and its predecessor and the
accompanying anger by those who were unsuccessful in obtaining
such information from HMI.
SEC Regulation FD ("Fair Disclosure") was designed to level the
playing field for all investors and eliminate the potential for
corporate management to treat material non-public information as
a commodity to be used to gain or maintain favor with particular
investors, analysts or others.
HMI has been amazed at the nature, brazenness and degree of such
activities at HomeSeekers.com prior to June 2001. As a result,
HMI commenced its own investigation into such practices starting
with a study of all posts on the popular website
http://www.ragingbull.com This research will be matched with
all HomeSeekers Press Releases since the first post to
http://www.ragingbull.comand the corresponding trading activity
in HomeSeekers.com common stock. HMI suspects a pattern will
emerge identifiable to specific individuals.
HMI intends to forward the results of such study to the
appropriate authorities, in addition to making demand on
HomeSeekers to pursue recovery on its own behalf against such
individuals of any profits made.
Although not required, HMI makes the following disclosures in
compliance with Regulation FD. HomeSeekers.com is at a critical
time in its history, and its remaining board of directors has
not communicated recent events to its employees, shareholders,
creditors and customers.
At no time has HMI or its predecessor made open market or
private transaction purchases of HomeSeekers.com common stock.
HMI is focused on saving the products and services of
HomeSeekers and combining them with other relationships.
As revealed by the recent 10K, HomeSeekers is not the company
that it had been painted to be, despite direct efforts to window
dress it to look differently. As was recently announced by
HomeMark, negotiation representations and the facts did not line
up. From the point of view of HMI, the issue was not whether
the company was troubled, but rather the nature and depth of the
trouble.
Based upon recent information confirmed to HMI, it has made
demand on HomeSeekers to investigate and commence appropriate
actions against certain members of management who served prior
to June 6, 2001 to recover damages on behalf of HomeSeekers as a
result of their various activities, or failure to act.
HMI's predecessor made the decision to divest itself of its
notes, liens, and other contract claims shortly after a meeting
held on October 6, 2001. At this meeting, the final draft of
the 10K and a turnaround plan was presented and discussed by
members of HomeSeekers senior management.
The plan was unacceptable to HMI's predecessor as it presented
no reasonable period of time upon which to realize a return on
its investment and proposed a chapter 11 restructuring plan. It
was apparent that a different approach would have to be taken to
not only save the business, but present any type of reasonable
solution to creditors and shareholders to recoup losses and
generate a return, much less to generate a source of repayment
of senior indebtedness to HMI.
As revealed to HMI by HomeMark, HomeMark had not originally
approached HomeSeekers with a view to becoming a lender. In
fact, in early discussions, HomeMark learned HomeSeekers was
unable to meet the payroll in early June 2001 and had only made
some payrolls by accelerating collections on multi-year
contracts in an apparent attempt to make the books look like a
cash positive proposition from an operational standpoint. In
fact, HomeSeekers submitted on June 1, 2001 financial
projections to the NASDAQ Listing Qualifications Panel in
connection with its delisting hearing that showed positive
operating income for the month of June 2001, despite losses of
almost $1 million per month since January of 2001.
HomeMark relied on these projections, presumably approved by the
board of directors of HomeSeekers, and now was presented with
the choice of either making a loan on the spot with the chance
of repayment, thereby keeping the doors open until the next
payroll, or allowing HomeSeekers to go under in June. In
hindsight, allowing HomeSeekers to go under would have been the
more humane thing to do. In light of the 10K, these financial
projections were false. Willing to take some risk, the decision
was rapidly made by HMI's predecessor to document and make the
first loan which occurred prior to the execution of any
securities purchase agreement by HomeMark.
HMI was formed as an interim vehicle to hold the collateral for
the HomeSeekers loans in anticipation of developing a plan
outside of bankruptcy for HomeSeekers to propose to its
creditors and shareholders. This plan includes the foreclosure
by HMI on the HomeSeekers collateral; the acquisition of HMI by
another publicly traded company; the assumption by HMI of
various vendor accounts necessary to the continued operation of
the business; the creation of a liquidating trust for the
benefit of HomeSeekers creditors and shareholders; and a special
offering to HomeSeekers shareholders.
This plan has been proposed repeatedly, in writing and verbally,
to HomeSeekers' board of directors since October 18, 2001 during
which time HMI even agreed to a short forbearance of action to
foreclose on its collateral. To date, no substantive response
has been received, and HMI believes that the board of
HomeSeekers is currently negotiating with members of management
who served prior to June of 2001.
Last week, the CEO of record of HomeSeekers as of June 1, 2001
entered the Brea, CA facility and called an all hands staff
meeting to proclaim that he had been reinstated as CEO. These
actions were of course false, and he was escorted from the
premises. In Reno, Nevada, a former board member and officer of
HomeSeekers appeared seeking to review books and records. He
was denied access as such request complied with neither the
Bylaws of HomeSeekers nor Nevada law.
On October 19, 2001, a former director of HomeSeekers made a
telephonic threat to a receptionist in Brea, CA in an attempt to
have his call routed to an officer of the Company.
HMI firmly believes the employees, customers, shareholders and
creditors of HomeSeekers deserve better. HMI is continuing its
efforts to open a line of communication with the board of
directors of HomeSeekers.
I2 TECHNOLOGIES: Operating Losses Spurs S&P to Slash Ratings
------------------------------------------------------------
Standard & Poor's lowered its corporate credit rating on i2
Technologies Inc. to single-'B'-plus from double-'B'-minus. At
the same time, the convertible subordinated debt rating on the
company was lowered to single-'B'-minus from single-'B'.
The outlook is negative.
The downgrade reflects the company's announcement that it
expects operating losses during the next few quarters due to a
weakened software applications spending environment. September
quarter total revenues were $194 million, down 39% from $320
million in the year earlier period, due to a steep drop in new
license sales. As an offset, sales from services and maintenance
contracts have remained relatively steady in 2001 at an average
quarterly run rate of $135 million. Despite attempts to resize
i2's expenses in line with rapidly falling license revenues,
operating losses and negative cash flow are expected over the
near term.
Dallas, Texas-based i2 Technologies provides software and
services focused on the supply chain and procurement sectors
that help customers both increase revenues and decrease
operating expenses and working capital requirements. The ratings
reflect i2's leading position in the fragmented and evolving
supply chain management software segment and an active
acquisition strategy. Cash and short-term investments, at $766
million, exceed long-term debt of $411 million and provide
adequate liquidity to support operating expenses over the
intermediate term while the company continues its cost cutting
program and strives to reposition itself in an uncertain
spending environment.
Outlook: Negative
Timing for recovery in software applications spending is
uncertain. The ratings could be lowered if i2 is unable to
maintain its market position or its cash burn rate accelerates.
IASIS HEALTHCARE: S&P Holds Low-B Ratings with Negative Outlook
---------------------------------------------------------------
Standard & Poor's affirmed its speculative-grade corporate
credit, senior secured, and subordinated ratings on IASIS
Healthcare Corp. All ratings are removed from CreditWatch, where
they were placed with negative implications on September 29,
2000, in response to Standard & Poor's concerns about IASIS's
growing financial constraints.
The outlook is negative.
Franklin, Tennessee-based IASIS owns and operates 14 hospitals
in growing but competitive markets. The company maintains
reasonably strong, but not dominant, market positions in key
markets of Salt Lake City, Phoenix, Tampa/St. Petersburg, and
Texas. The company also owns Health Choice, a Medicaid health
plan with about 46,000 members in Arizona.
The company's recent actions addressing key problem areas are
expected to limit further downside pressure on operating
performance. The struggling Rocky Mountain Medical Center has
been closed. Senior management in IASIS's Arizona market has
been replaced, and that market now appears stabilized. The
company's corporate infrastructure is more complete and is
expected to be more effective.
Key functions such as accounts receivable management are
improving, influenced by recently completed conversions and
replacements of information systems. The purchase of the
existing lease at St. Luke's Medical Center, and Tempe St.
Luke's Hospital in Arizona, should improve cash flow and provide
more operating flexibility.
Still, management will be challenged to sustain these expected
improvements. While the company's Arizona facilities have
stabilized, new management's ability to return this market to
reasonable profitability is not yet proven. New operating
initiatives at the corporate level may not produce expected
results. The company remains vulnerable to the expected
moderation of the currently strong managed-care pricing
environment, and to the future uncertainties of government
payments to hospitals in a weakened economy.
Finally, although IASIS received an amendment of its credit
facility regarding covenant compliance and allowing for the
acquisition of leased hospitals in Arizona, its capital
resources remain constrained by limited borrowing capacity.
Moreover, credit measures continue to be weak, with funds from
operations to lease-adjusted debt and return on capital both
under 10%.
Outlook: Negative
IASIS's failure to realize its expected improvement in the year
ahead could lead to a lowering of its ratings.
Ratings Affirmed, Removed from CreditWatch
IASIS Healthcare Corp.
Corporate credit rating B+
Senior secured bank loan rating B+
Subordinated debt rating B-
IBEAM BROADCASTING: Court Okays Access to $6MM Under DIP Pact
-------------------------------------------------------------
Judge Erwin I. Katz of the U.S. Bankruptcy Court in Wilmington,
Delaware, granted iBeam Broadcasting Corp. interim approval to
obtain up to $6 million under an $18 million debtor-in-
possession (DIP) financing agreement with Williams
Communications LLC, Dow Jones reported.
Judge Katz signed the order last week. A final DIP hearing is
slated for Nov. 1, and interested parties may file objections
through Oct. 30. With the credit provided by the DIP pact, the
filing said that iBeam would have the liquidity necessary to
operate its business.
In its motion, Sunnyvale, California-based iBeam, said the
Williams loan agreement is vital to the company's "ability to
operate in chapter 11 and for (iBeam) to complete a
restructuring." Williams Communications LLC, a wholly owned
subsidiary of Williams Communications Group Inc., has also
agreed to purchase iBeam's assets for $25 million in cash.
iBeam said it would require $6 million to operate for the 22
days following its October 11 bankruptcy filing. It will need a
minimum of $9 million to operate through the close of the asset
sale, which is estimated to occur 55 days from the petition
date. Pending final approval, the DIP agreement would terminate
on March 31, 2002, or when a sale of the company's assets
closes. (ABI World, October 22, 2001)
ICG COMMS: Asks Court to Okay Sublease with Cylink & Orchard Jay
----------------------------------------------------------------
The Debtor ICG Communications, Inc., asks Judge Walsh to
authorize it to enter into a sublease of a portion of a floor in
an office building in Santa Clara, California. The Debtors
assure Judge Walsh they regularly enter into agreements such as
the Sublease in the ordinary course of their businesses.
However, out of an abundance of caution, and in light of the
Landlord's request, the Debtors are seeking Judge Walsh's
express approval to enter into this sublease.
The Sublease And Consent Agreement
Orchard Jay Investors, LLC, and David J. Brown lease a 142,552
square foot building located at 3101, 3131, and 3151 Jay Street,
in Santa Clara, California to Cylink Corporation. On or about
August 21, 2001, Debtor ICG Communications entered into an
agreement to sublet a portion of the first floor of the Jay
Street Building.
The salient terms of the Sublease are:
(1) Rent: For rent between September 19, 2001 and October
31, 2001, advance payment of $45,375.24. Thereafter:
Rent Amount Months
$29,308.50 1-12
$32,002.35 13-24
$34,736.00 25-36
(2) Term: Three years, with an option to renew for an
additional year.
(3) Security Deposit: An irrevocable standby letter of
credit in the amount of $195,390.00.
The Debtors' Business Need
Pursuant to the Sublease, the Debtors have moved critical
components of their telecommunications businesses to the
Premises. Specifically, at the Premises, the Debtors house
office space and the regional operating center. The ROC is a
regional hub for the Debtors' telecommunications network.
In accordance with the terms of the lease between the Landlord
and Cylink, Cylink must obtain the Landlord's consent to any
sublease of the Jay Street Building. In a consent agreement, the
Landlord conditioned his consent to the Sublease on the Debtors
obtaining Judge Walsh's authority to enter into the Sublease and
the Consent Agreement, and execute the Letter of Credit.
The Sublease, Consent Agreement, and Letter of Credit clearly
satisfy the business judgment standard. The Sublease and Consent
Agreement cover property that is critical to the Debtors'
ongoing telecommunications operations. Any movement of the
operations currently conducted on the Premises to new facilities
would be extremely expensive, if not impossible.
Accordingly, the Debtors believe that entering into the Sublease
and Consent Agreement, and executing the Letter of Credit, is in
the best interests of the Debtors' estates, creditors and other
parties in interest. (ICG Communications Bankruptcy News, Issue
No. 11; Bankruptcy Creditors' Service, Inc., 609/392-0900)
IMPERIAL SUGAR: James C. Kempner Will Take Helm As New CEO
----------------------------------------------------------
Imperial Sugar announced that James C. Kempner, President and
CEO will retire as CEO and as a member of the Board of Directors
effective October 23, 2001. Robert J. McLaughlin, Chairman of
the Board of Imperial, will assume the additional duties of
President and CEO.
Commenting on the management change, James Kempner said, "Last
year I had informed the Board of Directors that it was my intent
to retire when I reached 62 in July, 2001 and I subsequently
indicated to the informal committee of bondholders during
negotiations leading to the restructuring of Imperial that I
would lead the Company through the restructuring process, but
expected to retire following its completion."
Mr. Kempner continued, "Our industry appears to have turned the
corner; Imperial's competitive ability has been substantially
enhanced by the successful completion of its restructuring; the
Company has an experienced and capable management team in place
which will now be augmented by Bob McLaughlin's extensive
experience in heading companies similar to Imperial. I leave a
strong company in good hands."
Mr. McLaughlin has fifteen years of experience performing as a
CEO of major public Companies and several private companies. His
background encompasses the management of profitable enterprises
engaged in high growth markets to the turnaround of under-
performing entities including three companies operating under
the protection of the U.S. Bankruptcy Code. He was also CEO from
1995 to 1996 of Spreckels Sugar Company, a multi factory
California based beet sugar processor with $200 million in
annual sales.
Mr. McLaughlin is the CEO of the Sutter Group, a management
consulting firm based in Larkspur, CA. Mr. McLaughlin commented
that he is excited about the opportunity to lead Imperial's
management team into the next phase in its historical
development. "Jim Kempner has done a great job in leading this
Company over the last eight years particularly through this last
year as it entered and exited the Chapter 11 process. Imperial
is ready for a new period of growth and success and I am proud
to be associated with this effort."
Imperial Sugar Company is the largest processor and marketer of
refined sugar in the United States and a major distributor to
the foodservice market. The Company markets its products
nationally under the Imperial, Dixie Crystals, Spreckels,
Pioneer, Holly, Diamond Crystal and Wholesome Sweeteners brands.
Additional information about Imperial Sugar may be found on its
web site at http://www.imperialsugar.com
INNOVEDA: Not in Technical Compliance with Fleet Loan Facility
--------------------------------------------------------------
Innoveda, Inc. (Nasdaq:INOV), a leading provider of software and
services for the design of advanced electronic products,
reported financial results for the third quarter ended September
29, 2001. Revenue for the quarter was $20.0 million, meeting the
target announced by the company earlier in the quarter. The
company's operating loss of $2.9 million, before amortization
and unusual charges, was better than the projected loss of $3 to
$4 million.
As anticipated, Innoveda recorded a restructuring charge of $5.3
million for severance, fixed assets and facility-related
charges, and a non-cash asset impairment charge of $32.9 million
related to intangible assets and goodwill recorded as a result
of mergers completed in 2000. Including these one-time charges,
the net loss for the third quarter of 2001 was $34.8 million.
For the same period last year, Innoveda reported revenue of
$23.1 million, operating income of $3.3 million, before
amortization and unusual charges, and a net loss of $4.8
million.
Revenue for the nine months ended September 29, 2001 was $69.4
million. The operating loss, before amortization and unusual
charges, for the year-to-date period was $4.7 million and, for
the same period, the net loss was $43.6 million. For the
comparable periods last year, Innoveda reported revenue of $59.0
million, operating income of $5.2 million, before amortization
and unusual charges, and a net loss of $9.9 million.
Third Quarter Review
Commenting on the quarterly results, President and Chief
Executive Officer William J. Herman said, "In August we took
decisive action to restructure our company, in response to our
customers' changing business needs and global economic
conditions. We also set a new target for revenue and committed
to a rapid return to profitability. Judging by our third quarter
results, I'm pleased to report that our strategy is succeeding.
We beat the financial goals we set for the quarter and, even
with our reduction in overall spending, we increased our
technology investment in key areas that customers tell us are
crucial for getting their products to market as quickly as
possible - high-speed printed circuit board (PCB) design and
analysis, advanced system-level design and simulation, and
electromechanical design. We're already seeing the positive
impact of our new sales management team, and I'm confident they
will contribute significantly to Innoveda's future success.
"As we move forward, our customers can expect to see new
cutting-edge, critical-path products released throughout the
coming year. Innoveda is well positioned, ahead of plan, and
poised to return to profitability next quarter," said Herman.
During this quarter, Innoveda made major enhancements to its
PowerPCB advanced, core printed circuit board layout solution.
Among these enhancements are a powerful Design For Fabrication
module, which enables designers to do fabrication checks in the
layout environment; expanded database capabilities; new routing
and scripting enhancements; and tighter integration with other
Innoveda tools.
In addition, Innoveda released new DxDesigner software, which
includes a new design engineering solution for capturing,
verifying and simulating design intent; a gateway between design
definition and the entire enterprise; and a new paradigm for
design creation that enables team-based design.
Business Outlook
According to Herman, Innoveda expects fourth quarter 2001
revenue of approximately $22 million and operating margin,
before amortization, of approximately 12 percent, an increase
from the previously forecasted operating margin of 8 to 10
percent. These results, coupled with lower amortization expense
for the future, would enable the company to achieve a modest net
income for the fourth quarter, significantly sooner than
originally expected.
"Although the current global economic situation remains
uncertain, Innoveda is now better positioned for success, re-
focused on solving our customers' critical business challenges
with leading ``must-have' technology," Herman said.
Pro Forma Results
Innoveda was formed by the March 2000 merger of Viewlogic
Systems, Inc. and Summit Design, Inc. The company acquired PADS
Software, Inc. in September 2000. Actual results for 2000
include contributions from Viewlogic for the entire year, Summit
Design from March 2000 and PADS from September 2000. The pro
forma financial statements accompanying this release include the
operations of Viewlogic, Summit Design and PADS on a combined
basis for the 2000 periods presented.
Innoveda, Inc. is a leading provider of innovative software and
services that help engineers visualize, design and build
advanced electronic systems for companies in the
telecommunications, transportation, computer and consumer
electronics markets. The company's rich heritage of technical
innovation forms the foundation of its comprehensive electronic
product solutions for system-level design, board design and
electromechanical design. Headquartered in Marlboro, Mass.,
Innoveda has offices worldwide. Additional information can be
found at: http://www.innoveda.com
Liquidity and Financial Condition
As of June 30, 2001, Innoveda had approximately $14.8 million in
cash and cash equivalents. Innoveda has a $6.0 million revolving
Line of Credit with Fleet Bank. As of June 30, 2001, no balance
was outstanding under this Line of Credit. Innoveda has a Term
Loan with Fleet Bank, with $7.5 million outstanding as of August
13, 2001. Borrowings under the Credit Facility are secured by
substantially all of Innoveda's assets. The Credit Facility
contains limitations on additional indebtedness and capital
expenditures, and includes financial covenants, which include
but are not limited to the maintenance of minimum levels of
profitability, interest and debt service coverage ratios and
maximum leverage ratios and minimum working capital ratios.
For the quarter ended June 30, 2001, the Company did not meet
certain of its financial covenants, as required by its Credit
Facility agreement. Under the terms of the Credit Facility
agreement, the lender may demand immediate payment of all
principal, interest and other amounts when limitations and
covenants are not met and therefore, the Term Loan has been
classified as current debt on the condensed consolidated balance
sheet. The Company is currently negotiating with the lender for
a revised Credit Facility agreement and expects to obtain a
revised agreement that will allow Innoveda to maintain its
current Line of Credit and to continue to repay its Term Loan as
previously scheduled. As of August 14, 2001, the lender had not
demanded payment and the Company does not expect the lender to
demand immediate payment.
Innoveda believes that its current cash and cash equivalents,
combined with cash generated from operations and amounts
available under the revolving line of credit, will satisfy
Innoveda's anticipated working capital and other cash
requirements for at least the next 12 months. At June 30, 2001,
the Company's current assets totaled $45 million, while its
current liabilities totaled $48 million.
INTEGRATED ELECTRICAL: S&P Revises Positive Outlook to Stable
-------------------------------------------------------------
Standard & Poor's revised its outlook on Integrated Electrical
Services Inc. to stable from positive. At the same time,
Standard & Poor's affirmed its ratings on the company.
At June 30, 2001, the company had about $291 million of total
debt.
The outlook revision follows the company's announcement that due
to the weakening economy and the tragic events of September 11,
Integrated Electrical now expects diluted earnings of 8 cents to
9 cents for the fourth quarter ended Sept. 30, 2001, as opposed
to previous guidance of 30 cents to 32 cents per diluted share.
As a result of weakening fundamentals, the potential for higher
ratings has diminished in the intermediate term.
The ratings reflect Integrated Electrical's leading business
position in the large and highly fragmented electrical
contracting services industry, and a moderate financial profile.
Houston, Texas-based Integrated Electrical provides electrical
system design and installation services for both new and
maintenance construction projects. End-user markets are diverse,
including commercial, industrial, residential, power line, and
voice/data/video (VDV). The company benefits from product
breadth and geographic scope, which support strategic alliances
with companies seeking nationwide services. Although earnings
and cash flows are partially tied to new construction activity,
a healthy and growing amount of sales to the more stable
maintenance, repair, and replacement (MRR) markets and a highly
flexible cost structure should help temper effects of industry
cyclicality.
Currently, weakness in the U.S. economy, particularly in parts
of the Southeast and Midwest, has led to intensified pricing
pressures and project delays. Furthermore, the VDV segment has
declined significantly during the past few quarters as both
industrial and telecommunications customers have scaled back
capital spending. As a result, Integrated Electrical has reduced
headcount, streamlined operations, and redeployed other field
staff into stronger end-markets, including power generation.
Over time, Integrated Electrical should derive modest growth
potential from outsourcing and vendor consolidation, which is
occurring in a variety of North American industries. These
trends should lead to increased national account awards for the
industry's largest participants. National accounts are viewed
favorably because they tend to be recurring and have not led to
material price degradation.
A close focus on project controls and increasing content from
MRR activities should help keep funds from operations to total
debt in the 20%-25% range and total debt to pro forma EBITDA
around 2.5 times, acceptable measures for the ratings. In the
future, the company is expected to temper its historically
aggressive acquisition program and mainly focus on integrating
acquired operations. Integration challenges include installing
new MIS systems, gaining purchasing leverage, and developing a
business culture based on margin enhancement as opposed to
revenue growth. Over time, Integrated Electrical will supplement
internal growth with a modest amount of bolt-on transactions to
further extend the firm's product offerings, geographic reach,
and customer list. Transactions, however, should be funded in a
manner that preserves balance sheet integrity.
Outlook: Stable
Leading market positions, a highly variable cost structure, and
a commitment to a moderately leveraged balance sheet limit
downside ratings potential. The potential for further end-market
deterioration in the near term and a moderately aggressive
growth strategy restrain upside ratings potential.
Ratings Affirmed, Outlook Revised to Stable
Integrated Electrical Services Inc.
Corporate credit rating BB+
Senior secured rating BBB-
Subordinated debt rating BB-
LAIDLAW: Secures Okay to Amend D&O Defense Trust & Pay Costs
------------------------------------------------------------
Laidlaw Inc. seeks an order:
(a) authorizing the amendment of a trust agreement and certain
interim payments pursuant to the agreed treatment for
certain director and officer claims set forth in the D&O
Claim Treatment Letter; and
(b) approving the payment of certain fees and expenses of
these subcommittees:
(i) the steering committee of the Debtors' pre-petition
bank group, and
(ii) an informal committee of the Debtors' pre-petition
Noteholders.
When Safety-Kleen Corporation announced possible accounting
irregularities, Joseph M. Witalec, Esq., at Jones, Day, Reavis &
Pogue, in Columbus, Ohio, relates that several individual and
class action lawsuits were initiated against Safety-Kleen, its
directors and officers and other parties. In addition, Mr.
Witalec reports that other lawsuits have been commenced alleging
violations of securities laws relating to certain financing and
reporting activities by the Laidlaw Companies.
According to Mr. Witalec, before the filing of these chapter 11
cases, the Debtors negotiated with the subcommittees regarding a
possible restructuring of the Debtors' financial obligations and
related matters. These negotiations, Mr. Witalec relates,
resulted in the execution of a global agreement that was
memorialized in several documents, including the D&O Claim
Treatment Letter, the Settlement and Lock-Up Agreement and the
Joint Plan of Reorganization of Laidlaw Inc. and Its Debtor
Affiliates.
Mr. Witalec says that as part of the settlement, the Debtors and
the subcommittees agreed to the preliminary treatment of the
issues relating to the insurance and reimbursement arrangements
for Laidlaw Inc.'s present and former directors and officers who
had been named as co-defendants with Laidlaw in the securities
lawsuits. The parties also agreed to provide for the
continuation of the subcommittees and the payment of their
respective fees and expenses.
The D&O Claim Treatment Letter
The D&O Claim Treatment Letter removes the initial uncertainty
as to the handling of the directors' and officers' claims for
reimbursement for various costs associated with the securities
lawsuits, Mr. Witalec declares. It also resolves potentially
protracted and expensive litigation regarding those claims while
conserving valuable estate assets, Mr. Witalec says. Finally,
Mr. Witalec asserts that the D&O Claim Treatment Letter caps the
debtors' maximum initial exposure to the directors and officers
on account of their reimbursement claims.
The principal terms of the D&O Claim Treatment Letter are:
(a) The debtors will use their best efforts, including, if
necessary, by litigation, to cause the issuers of the
Debtors' Directors and Officers Insurance to pay the
directors' and officers' claims and to reimburse Laidlaw
for any defense costs covered by the insurance.
(b) The directors and officers will have access to the
insurance for the claims.
(c) Laidlaw may renew the Directors and Officers Insurance
for up to 2 years so long as the extension can be
obtained for a premium of $850,000 or less.
(d) The existing Defense Trust that was established by the
Debtors to satisfy the claims of the directors and
officers may continue for 10 years after the Debtors'
emergence from bankruptcy and may be used to pay any
claims not covered by the Directors and Officers
Insurance.
(e) The Debtors may contribute additional funds to the
Defense Trust to maintain a balance of at least
$10,000,000; provided, that additional trust
contributions will be made in $1,000,000 increments up
to an aggregate cap of an additional $10,000,000.
(f) Any reimbursement by the insurers for claims made by the
directors and officers to the Defense Trust will be
contributed to the Defense Trust.
(g) The maximum value of the aggregate of the Defense trust
and the additional trust contributions cap shall be
reduced on the anniversaries of the effective date of
any chapter 11 plan of the Debtors to:
(i) On the 2nd anniversary $17,500,000
(ii) On the 4th anniversary 15,000,000
(iii) On the 6th anniversary 12,500,000
(iv) On the 8th anniversary 10,000,000
(v) On the 10th anniversary 0
Any reductions in the Defense Trust will be remitted to
the Reorganized Debtors.
(h) The Defense Trust will be amended to reflect the terms
and conditions of the D&O Claim Treatment Letter.
(i) The directors and officers agree to waive all
reimbursement claims that might otherwise have been
brought in the Canadian Cases.
The Lock-Up Agreement and
the Payment of the Subcommittee Expenses
Mr. Witalec tells the Court that because of the subcommittees'
crucial role in the rapid progress of the debtors' restructuring
efforts, the Debtors agreed to pay certain fees and expenses of
the subcommittees, including the payment of legal and financial
advisors, both prior to and during the Debtors' chapter 11
cases. Payment of the subcommittee expenses is expressly
provided for in the proposed Plan, Mr. Witalec notes. According
to Mr. Witalec, the payment of these expenses recognizes the
crucial role played by the subcommittees in the debtors'
restructuring and will allow the subcommittees to continue their
vital contributions through the remainder of these chapter 11
cases for the benefit of the Debtors' estates.
The Debtors have demonstrated a sound business purpose for
amending the Defense Trust to allow for the trust payments and
for paying the additional trust contributions and the
subcommittee expenses, Mr. Witalec asserts. Amending the
Defense Trust will reduce the distraction of the securities
lawsuits, Mr. Witalec says, and paying the subcommittee expenses
will allow the subcommittees to continue their effective
contributions to an expedited exit from chapter 11 for the
Debtors.
* * *
Convinced by the Debtors' arguments, Judge Kaplan issued an
interim order authorizing the Debtors to:
(a) amend the terms of the Defense Trust to make the Trust
Payments to the Directors and Officers in accordance
with the terms of the D&O Claim Treatment Letter and
otherwise to be consistent with the D&O Claim Treatment
Letter,
(b) make the Additional Trust Contributions to the Defense
Trust in accordance with the D&O Claim Treatment Letter;
and
(c) pay the Subcommittee Expenses in the exercise of their
reasonable discretion.
But Judge Kaplan reminds the Debtors that the relief granted is
only on an interim basis through the confirmation date of a plan
of reorganization in these cases. In the event a plan of
reorganization is confirmed in these cases that does not provide
for the payment of:
(1) the Trust Payments or Additional Trust Contributions
under the D&O Treatment Letter, or
(2) the Subcommittee Expenses contemplated in this Order,
Judge Kaplan rules that the recipients of any interim payments
should return such interim payments to the Debtors. (Laidlaw
Bankruptcy News, Issue No. 8; Bankruptcy Creditors' Service,
Inc., 609/392-0900)
MARINER POST-ACUTE: MHG Wants More Time to Decided on Leases
------------------------------------------------------------
Mariner Health seeks a further extension of the period by which
they must assume or reject their unexpired leases of
nonresidential real property to and including the earlier of (a)
January 31, 2002 (or such later date as may be fixed on
subsequent motion of the Debtors and (b) the effective date of a
plan of reorganization regarding 60 such leases as designated in
Exhibit A to the motion, subject to amendment of the list.
The Debtors seek the extension on the bases that:
(1) the leases are important assets of the estates;
(2) the MHG chapter 11 cases are large and complex;
(3) despite significant progress made, the Debtors need
additional time to act intelligently in making the judgment
to assume or reject;
(4) a further extension of the period will not prejudice the
lessors under the unexpired leases.
In particular, the Debtors tell Judge Walrath that they have
been forced to concentrate their efforts over the course of the
last few months on negotiating and seeking Court approval of the
Memorandum of Understanding dated as of September 5, 2001 (the
MOU) with the MPAN Senior Secured Lenders and the MHG Senior
Secured Lenders.
Furthermore, the Debtors are planning to file and seek
confirmation of a plan or plans of reorganization in the near
future, pursuant to which the Debtors will make a final
determination with respect to each of the unexpired leases.
Therefore, the Debtors submit that the additional extension
requested is reasonable and necessary and will avert the
statutory forfeiture of valuable assets, promote the Debtors'
ability to maximize the value of their chapter 11 estates, avoid
the incurrence of needless administrative expenses by minimizing
the likelihood of the premature assumption of a burdensome
lease, and most importantly, help preserve the health and safety
of their patients and facility residents.
Richards, Layton & Finger, P.A., attorneys for the Debtors,
represented at the Hearing that there were no objections to the
motion. Accordingly, the Court indicated at the Hearing that it
would sign the order granting the motion. (Mariner Bankruptcy
News, Issue No. 20; Bankruptcy Creditors' Service, Inc.,
609/392-0900)
MERCHANTONLINE: Files For Bankruptcy Protection in Florida
----------------------------------------------------------
MerchantOnline.com, Inc. (OTCBB:MRTO), a digital payment
products and services provider for credit cards and debit cards,
filed voluntary petitions for reorganization under Chapter 11 of
the U.S. Bankruptcy Code in the United States Bankruptcy Court
in West Palm Beach, Florida.
Jim Degracia, CEO of MerchantOnline, stated that the company
still has strong technology and a viable business model for its
products and services. The volatile economic and public market
conditions hampered the company's efforts to raise equity
capital to support its operations.
"We expect to be in a much stronger financial position going
forward, with no debt and a much smaller cash requirement," said
Mr. Degracia. "With the growth in revenue projected from our
contracts and pending contracts, combined with the continued
reduction of costs, we will be on a faster path to
profitability. The demand for our Newcash technology provides a
basis for future growth in a market that demands the next
generation of secure transaction capabilities.
The company is currently finalizing arrangements with sources of
Debtor in Possession financing.
Founded in December 1997, MerchantOnline provides a secure
transaction network that enables businesses and consumers to use
one payment system for both their real world and virtual world
needs, utilizing credit cards, ATM/debit cards and other payment
programs.
MIDWAY AIRLINES: Advises No Return for Stocks Under Any Plan
------------------------------------------------------------
An article in News and Observer suggested that an investor in
the common stock of Midway Airlines (MDWYQ) might earn 10 to 20
times their investment if Midway "comes back." This has resulted
in extraordinary trading in Midway's common stock.
Midway advises its stockholders and potential purchasers of its
stock, that given current market conditions and the
opportunities presently available to Midway, it is more likely
than not that a Plan of Reorganization would provide for no
recovery for common stockholders. In such a Plan of
Reorganization, all shares of common stock would be cancelled
and rendered of no further force and effect.
Midway further advises that it is presently evaluating several
possible Plans of Reorganization, including those that
contemplate a resumption of flying operations, and none of such
Plans of Reorganization contemplates any recovery for common
stockholders.
NIAGARA MOHAWK: Declares Dividends on Preferred Shares
------------------------------------------------------
The Board of Directors of Niagara Mohawk Power Corp., a
subsidiary of Niagara Mohawk Holdings, Inc. (NYSE: NMK),
declared dividends at prescribed rates for all series of its
preferred stock.
The fourth-quarter dividend rate per annum for the adjustable
rate preferred stock Series A is 6.50 percent; Series B is 7.50
percent; and Series C is 7.00 percent. These rates equate to
payments of $0.40625; $0.46875; and $0.4375 per share,
respectively. Preferred dividends are payable December 31 to
holders of record December 10, 2001.
Last month, TCR reported that Niagara Mohawk booked a negative
capital balance of $568.5 million. According to Standard &
Poor's, Niagara Mohawk Power's weak financial profile reflects
the effect of debt incurred to restructure its substantial and
costly purchased-power agreements, as directed by the master
restructuring agreement approved by the New York Public Service
Commission (PSC).
As a result, debt leverage has increased, and cash flow
protection measures are weak for the rating category. Over the
intermediate term, the financial profile is expected to
improve as Niagara Mohawk Power pays down debt and is able to
pass in rates the true cost of electricity.
ORBITAL SCIENCES: May File For Chapter 11 with Prearranged Plan
---------------------------------------------------------------
On September 24, 2001, Orbital Imaging Corporation, the
satellite imaging affiliate of Orbital Sciences Corporation,
announced that it had reached a non-binding agreement in
principle with certain of its major shareholders, including
Orbital, and an Informal Committee representing the holders of
about half of its Senior Notes, to go forward with a financial
restructuring designed to strengthen ORBIMAGE's financial
condition.
The agreement in principle provides that Orbital will support
the financial restructuring of ORBIMAGE with a financial package
that includes both cash and non-cash contributions. The
agreement and the ORBIMAGE restructuring are subject to various
conditions, including obtaining approvals from the holders of
specified percentages of ORBIMAGE's Senior Notes and preferred
stock and the receipt by ORBIMAGE of certain third-party
financing, and there can be no assurances that the agreement and
the restructuring will be consummated.
On September 21, 2001, Orbital announced that the launch of its
Taurus rocket, which was carrying the Orbview-4 satellite for
ORBIMAGE, did not achieve the mission's intended orbit and the
satellite was lost. Under the terms of the agreement in
principle, Orbital procured approximately $11 million of launch
insurance coverage and ORBIMAGE procured certain additional
insurance for itself and for the benefit of the holders of its
Senior Notes.
ORBIMAGE reported that, as is customary in this type of
restructuring, it intends to file a petition for reorganization
under Chapter 11 of the U.S. Bankruptcy Code with a
"prearranged" plan of reorganization, and that it intends to
file the petition in the fourth quarter of 2001 and expects to
maintain normal business relationships with all of its customers
and suppliers.
Also under the terms of the agreement in principle, Orbital
would, subject to certain conditions, provide up to $3.6 million
in debtor-in-possession funding (to be repaid in new secured
notes if the ORBIMAGE restructuring is successfully completed)
and would defer $8.6 million payable by ORBIMAGE under the
Orbital/ORBIMAGE procurement and administrative services
agreements, which deferred amounts would be exchanged for new
secured notes to be issued by ORBIMAGE upon the successful
completion of ORBIMAGE's restructuring.
Orbital also agreed to pay up to $5 million in cash in
satisfaction of launch delay penalties under the existing
Orbital/ORBIMAGE procurement agreement, which would be, subject
to certain conditions, converted into subordinated notes payable
to Orbital. Of the $5 million in launch delay penalties, $1
million was paid to ORBIMAGE in March 2001, an additional $2.8
million was paid in September 2001 to ORBIMAGE, and the
remaining $1.2 million will be payable to ORBIMAGE on an as-
needed basis. Upon completion of the ORBIMAGE reorganization as
contemplated under the agreement, it is contemplated that
certain parties would grant each other mutual releases of
potential claims.
In addition, the agreement in principle contemplates that
various amendments would be made to the procurement agreement
and certain of the agreements between Orbital and ORBIMAGE to,
among other things, provide certain pricing terms and penalty
provisions. Further, certain parties entered into a "voting
agreement" to support the plan of reorganization pursuant to
which the ORBIMAGE restructuring would be converted.
PACIFIC GAS: Assumes PPA with Ripon Cogeneration as Amended
-----------------------------------------------------------
Pursuant to the Court's order providing for procedures to seek
proposed assumptions by PG&E of Power Purchase Agreements with
Qualifying Facilities (QFs) by Notice rather than Motion,
Pacific Gas and Electric Company sought and obtained the Court's
approval for the assumption of the Power Purchase Agreement
between PG&E and Cardinal Cogen, pursuant to 11 U.S.C. Section
365 and Rules 6006 and 9019 of the Federal Rules of Bankruptcy
Procedure.
Ripon operates a power generation facility with the capacity of
49,900 kW. Ripon is a counter-party to a PPA, which provides for
the purchase of power by PG&E from Ripon. Prior to the
commencement of the PG&E bankruptcy case, PG&E failed to pay in
full the amount due under the PPA, resulting in pre-petition
claims for payment to Ripon in the amount of $17,399,281.00 (the
Pre-Petition Payables).
Pursuant to the CPUC Decision No. 01-06-015 (the Lynch Decision)
June 13, 2001, whereby QFs under Standard Offer Contracts with
PG&E may request that their contracts be modified to replace the
energy pricing term with a five-year average fixed price of 5.37
cents/kWh (the Price Modification), PG&E and Ripon agreed on
July 13, 2001 to amend the PPA to replace the energy price term
with the CPUC price modification for 5 years (the PPA
Amendment).
The Assumption Agreement provides for the following general
terms:
(a) PG&E shall assume the PPA as amended, as set forth in
the Assumption Agreement, pursuant to 11 U.S.C. Section
365(b)(1) and (d)(2) and Rules 6006 and 9019 of the Federal
Rules of Bankruptcy Procedure;
(b) July 13, 2001 shall be the effective date for the PPA
Amendment and PG&E's assumption of the PPA, providing that all
conditions set forth in Sections 2 and 18 of the Assumption
Agreement are met, and further providing that Ripon has the
right to terminate the Assumption Agreement and PPA Amendment
for a 15-day period following the entry of the Bankruptcy Court
Order approving the PPA Amendment and Assumption Agreement, as
set forth more fully in Section 1.3 of the Assumption Agreement;
(c) As more fully set forth in Sections 3 and 4 of the
Assumption Agreement, upon the effective date of assumption of
the PPA, the Pre-Petition Payables (as such amount may be
adjusted pursuant to Section 8 of the Assumption Agreement)
shall be elevated to administrative priority status and shall
accrue interest, and shall be paid by PG&E to Ripon upon a date
determined in accordance with Section 3 of the Assumption
Agreement; and
(d) Ripon waives certain potential administrative and pre-
petition claims as more fully set forth in Sections 3, 5, 6 and
8 of the Assumption Agreement, including any claim to receive
any difference between a "market rate" and the contract price
for energy and capacity delivered to PG&E from and after April
6, 2001 through the effective date for PG&E's assumption of the
PPA. (Pacific Gas Bankruptcy News, Issue No. 16; Bankruptcy
Creditors' Service, Inc., 609/392-0900)
PLANET HOLLYWOOD: Files Chapter 22 Petition in M.D. Florida
-----------------------------------------------------------
The chief executive of Planet Hollywood International Inc.,
which blamed its bankruptcy filing on the recent terrorist
attacks, said the company had positioned itself for a turnaround
and could have pulled through had it not been for September 11,
reported Dow Jones.
Planet Hollywood's chairman, Robert Earl, said the company had
closed all of its unprofitable restaurants before September 11,
leaving only those that were making money. The company had also
obtained a commitment for financing before September 11 that has
fallen through because of the uncertainty brought on by the
attacks. Earl said that business at the company's remaining
restaurants has declined an average of 25 percent to 30 percent
since September 11.
Planet Hollywood filed for chapter 11 bankruptcy protection
Friday in Florida, saying the declines in travel and tourism
brought on by September 11 "created an untenable position for
the company." The Orlando-based restaurant chain listed $133
million in debt and $121 million in assets.
The bankruptcy reorganization will allow Planet Hollywood to
stabilize its financial position, the company said. The company
also said it did not intend to close any restaurants as part of
its reorganization, and that it would go ahead with plans for
outlets in Tokyo and Riyadh, Saudi Arabia. (ABI World, October
22, 2001)
POLAROID: Court Okays Payment of $4MM Critical Vendors Claims
-------------------------------------------------------------
Polaroid Corporation requests the Court's authority:
(a) to honor certain checks, drafts or wire transfers
delivered to various third parties prior to the Petition
Date that have not been presented and/or honored as of
the commencement of these cases; and
(b) subject to the express consent of the designated
lender(s) chosen by the Debtors' pre-petition and post-
petition lenders, to pay the pre-petition claims of
those vendors that the Debtors determine are critical
and necessary to their reorganization efforts.
According to Gregg M. Galardi, Esq., at Skadden, Arps, Slate,
Meagher & Flom, in Wilmington, Delaware, the total amount of the
Pre-petition Checks that the Debtors request authority to honor
does not exceed $4,000,000. Mr. Galardi advises that the
$4,000,000 total will be subject to the consent of a Designated
Lender (defined as one or more unidentified lenders chosen by
the Debtors' prepetition and post-petition lenders).
Prior to the Petition Date, Mr. Galardi relates, the Debtors
implemented certain internal procedures designed to limit its
expenditures. In the weeks leading up to the Petition Date, Mr.
Galardi says, the Debtors attempted to pay, to the greatest
extent possible, only those vendors that the Debtors believed
are or would be critical to a restructuring.
Thus, from September 28, 2001, through October 9, 2001, Mr.
Galardi tells Judge Walsh, the Debtors mailed only approximately
200 checks. Those Pre-petition Checks mailed during this period
approximated $8,000,000. Of this amount, Mr. Galardi notes,
checks for over $5,000,000 were mailed by the Debtors on October
1, 2001. Thus, the Debtors believe that it is highly likely
that the vast majority of these Pre-petition Checks have been
presented and honored as of the Petition Date. The Debtors also
believe that the total amount outstanding with respect to Pre-
petition Checks is likely significantly lower than the
$4,000,000 estimate.
In addition, Mr. Galardi tells the Court, there are certain
vendors that provide goods and services to the Debtors that are
essential to the Debtors' business and operations. Without
these essential materials and services, Mr. Galardi says, the
Debtors would be unable to maintain their operations and an
uninterrupted supply of quality products to their customers.
Absent the support of such vendors, Mr. Galardi notes, the
Company would likely experience a significant loss of customers,
erosion of goodwill, and deterioration in the value of the
Debtors' businesses.
Without payment of the Critical Vendor Claims, Polaroid
Executive Vice President Neal D. Goldman notes it is likely that
some or many of the Critical Vendors will either refuse or be
unable to continue providing essential materials and services to
the Debtors. Moreover, Mr. Goldman relates, finding replacement
vendors for essential materials and services would be difficult,
if not impossible. It may even compromise the quality of the
Debtors' manufacturing and production, resulting in significant
expense to the Debtors' estates, Mr. Goldman warns.
In addition, Mr. Goldman states, the Debtors likely would be
forced to pay a premium for replacement supplies because of the
perceived risk of doing business in chapter 11 and because some
of the Debtors' terms with existing Critical Vendors are more
favorable than those available from other suppliers without
regard to chapter 11.
As a leading manufacturer of instant cameras and film, Mr.
Galardi says, the Debtors "cannot survive" unless they have a
"continuous supply" of raw materials and services from their
Critical Vendors.
If the Pre-petition Checks are not honored and the Critical
Vendor Claims not satisfied, Mr. Galardi informs the Court, the
Debtors may not be able to obtain necessary materials and
services to be able to maintain post-petition production, sales,
and customer relations. According to Mr. Galardi, many of the
holders of Critical Vendor Claims and recipients of Pre-petition
Checks represent the Debtors' only readily available source for
certain materials and services required to continue
manufacturing operations. Thus, Mr. Galardi tells Judge Walsh
that granting the relief requested will afford the Debtors the
opportunity to maintain customer relations, as well as the
quality of the Debtors' manufacturing and supply operations.
Such relief will also ensure uninterrupted cash flow from the
Debtors' businesses, increasing the likelihood of a successful
reorganization, Mr. Galardi adds.
Subject to the Designated Lender's consent, Judge Walsh
authorizes the Debtors to pay up to $4,000,000 of Critical
Vendor Claims. The Court will also permit the Debtors to issue
post-petition checks in replacement of any Pre-Petition Checks
or fund transfer requests dishonored or rejected as of Petition
Date.
According to Judge Walsh, any vendor that accepts payment of a
Critical Vendor claim will no longer have an allowed claim
against the Debtors and the vendor will be deemed to have waived
all of its pre-petition claims against the Debtors.
Before the Debtors pay any Critical Vendor Claim, the vendor is
asked to agree to continue selling materials or providing
services to the Debtors. If a vendor accepts payment but does
not continue to sell or service the Debtors, then Judge Walsh
decrees that:
(a) any payment to such vendor of any Critical Vendor Claim
shall be deemed a post-petition transfer recoverable by
the Debtors in cash upon written request; and
(b) upon recovery by the Debtors, any such Critical Vendor
Claim shall be reinstated as a pre-petition claim as if
the payment had not been made.
Prior to the payment of any Critical Vendor Claim, the Court
requires Debtors to provide written notice of its intent to make
such payment to the agent and each Prepetition and Postpetition
Lender and any Official Committee of Unsecured Creditors, and
will allow 7 business days for these parties to object. In the
event an objection is raised, no payment will be paid until the
matter is consensually resolved by the parties or authorized by
order of the Court. (Polaroid Bankruptcy News, Issue No. 2;
Bankruptcy Creditors' Service, Inc., 609/392-0900)
PRACTICEWORKS: Posts Q3 Net Loss of $8.3MM On $16.2M In Revenues
----------------------------------------------------------------
PracticeWorks, Inc. (Amex: PRW) reported financial results for
the third quarter of 2001 and for the nine months ended
September 30, 2001.
Third Quarter Highlights
* Total revenue increased to $16.2 million in the third quarter
of 2001 from $9.8 million in the third quarter of 2000, an
increase of 65%. Recurring revenue in the third quarter of 2001
was $11.4 million, an increase of 72% over the same period last
year.
* Total revenue increased 8% in the third quarter of 2001 from
the second quarter of 2001.
* EBITDA, as adjusted, was $905,000 in the third quarter of
2001, compared with $517,000 in the second quarter of 2001.
(EBITDA, as adjusted, excludes restructuring and other non-
recurring charges and preferred stock dividends).
Financial Review
Revenue -- For the three months ended September 30, 2001, total
revenue was $16.2 million, recurring revenue was $11.4 million
and non-recurring revenue was $4.8 million as compared to total
revenue of $9.8 million, recurring revenue of $6.6 million and
non-recurring revenue of $3.2 million, respectively, for the
quarter ended September 30, 2000. For the nine months ended
September 30, 2001, total revenue was $43.1 million, recurring
revenue was $30.1 million and non-recurring revenue was $13.0
million as compared to total revenue of $29.9 million, recurring
revenue of $19.0 million and non- recurring revenue of $10.9
million, respectively, for the nine months ended September 30,
2000.
Recurring revenue includes maintenance and support services,
subscriptions and e-services (electronic data interchange "EDI"
transactions and royalties and other revenues from e-commerce
and other Internet-based services). Non- recurring revenue
includes one-time sales of licenses and systems and fees for
training and implementation services. Year to date, recurring
revenue as a percentage of total revenue increased to 70% for
2001 compared to 63% for 2000.
This trend is expected to continue reflecting the Company's
subscription pricing for substantially all its products and
services. Revenue increased primarily as a result of increased
subscription and maintenance contracts and e-services and
includes the effect of the InfoSoft acquisition completed in the
first quarter of 2001.
EBITDA, as adjusted, was $905,000 in the third quarter of 2001
compared with $2.8 million for the third quarter of 2000.
EBITDA, as adjusted, means earnings before interest, taxes,
depreciation and amortization and also excludes restructuring
and non-recurring charges, gain or loss on disposal of fixed
assets and preferred stock dividends. The EBITDA, as adjusted,
results for the third quarter of 2001 compare favorably with
$517,000 in the second quarter of 2001, $568,000 in the first
quarter of 2001, and $1.5 million in the fourth quarter of 2000,
reflecting the positive effects of the Company's revised
business model including cost savings from the restructuring
implemented during August of 2000.
PracticeWorks reported a net loss of $8.6 million in the third
quarter of 2001, compared with a loss of $8.0 million for the
third quarter of 2000 and as compared to a loss of $8.3 million
in the second quarter of 2001.
Richard Perlman, PracticeWorks' Chairman said, "We continue to
enjoy the benefits of our new business model put in place in the
middle of last year. We believe the combination of 70% recurring
revenues and in excess of 30% revenue growth on an annualized
basis is unique. We are delighted with the progress we are
making and our ability to, once again, exceed expectations."
Jim Price, PracticeWorks' President and CEO, said, "These
results continue to reaffirm the success of our business
strategy. The sequential year over year and quarter over
quarter growth rates clearly demonstrate how well our products
are being received by the dental marketplace. We also continue
to focus on employee productivity to further enhance our
profitability. Both these factors created this exceptional
performance which is even more satisfying in light of the
general economic slowdown."
PracticeWorks, Inc. is an information management technology
provider for dentists, orthodontists and oral and maxillofacial
surgeons. PracticeWorks' product offerings include practice
management applications, business-to- business e-commerce
services, electronic data interchange (EDI) services, and
ongoing maintenance, support and training related to all
products.
As of September 30, the Company's current assets totaled $14.132
million, as opposed to current liabilities of $27.930 million.
RELIANCE GROUP: Plan Filing Exclusivity Extended to February 7
--------------------------------------------------------------
Reliance Group Holdings, Inc.'s exclusive period during which to
propose and file a plan of reorganization is extended to
February 7, 2002, and the Debtors' exclusive period during which
to solicit acceptances of that plan is extended to April 8,
2002. (Reliance Bankruptcy News, Issue No. 13; Bankruptcy
Creditors' Service, Inc., 609/392-0900)
REMINGTON PRODUCTS: S&P Affirms B Credit and CCC+ Debt Ratings
--------------------------------------------------------------
Standard & Poor's revised its outlook for Remington Products Co.
L.L.C. to stable from positive. At the same time, the single-'B'
corporate credit rating and triple-'C'-plus subordinated debt
rating for the company were affirmed.
Approximately $240 million in debt was outstanding on June 30,
2001.
The outlook revision reflects challenging conditions in the
retail industry, which could limit the potential for an upgrade
over the intermediate term. Furthermore, the company's financial
results for fiscal 2001 are expected to be below Standard &
Poor's expectations given the anticipated soft holiday selling
season, combined with one-time costs related to the company's
business in the U.K.
Ratings are based on Remington's high debt leverage and seasonal
nature of its sales, partially offset by the company's strong
niche position in the U.S. men's shaver market, with the number-
two electric razor, and its diverse portfolio of consumer
personal-care appliances.
The personal-care appliance segment is relatively mature, with
slow volume growth and limited pricing flexibility. Product
innovation and marketing are key factors in generating consumer
demand. Remington has experienced significant success with new
product introductions, with about 65% of 2000 sales coming from
products introduced within the past three years.
Nevertheless, Remington will be challenged to continue
developing innovative products within this mature category, and
to stay ahead of larger competitors, such as Norelco (subsidiary
of Philips Electronics N.V.) and Braun (subsidiary of Gillette
Co.).
Also, the seasonal nature of this business results in a
substantial portion of sales and earnings falling in the fourth
quarter of the calendar year, creating concern that a poor
holiday season could substantially impact results. After several
years of improvement, Remington's financial performance weakened
in the second quarter of 2001, compared to the same period last
year, primarily the result of one-time costs related to the
company's business in the U.K. Sales and operating earnings will
be further pressured throughout the remainder of 2001, given the
anticipated soft holiday-selling season and intense competition
within the personal-care appliance segment.
Nonetheless, Standard & Poor's expects Remington's credit
protection measures to remain in line with the rating for fiscal
2001 with EBITDA cash interest coverage of just under 2 times
and debt to EBITDA of about 5x.
Outlook: Stable
Remington needs to sustain credit measures above those expected
for its rating category to compensate for increased business
risks. Moreover, it is unclear at this point if difficult
industry conditions will allow the firm to improve its credit
measures over the intermediate term.
SAFETY-KLEEN: Seeks Approval of Indian Harbor Insurance Program
---------------------------------------------------------------
In an action closely related to their Motion for approval of the
Second Amended Consent Agreement described above, Safety-Kleen
Corporation and its 28 Debtor-affiliates ask Judge Walsh to
approve and authorize their entry into an insurance program with
Indian Harbor Insurance Company, and to post collateral in the
form of letters of credit, as required under the insurance
programs with respect to certain of the Debtors' facilities.
The Debtors, as owners and operators of hazardous waste
management facilities, are subject to certain financial
assurance requirements established under federal and state
environmental statutes and regulations The applicable
regulations provide several mechanisms from which the Debtors
may choose in order to establish Compliant Financial Assurance,
including corporate guaranties, letters of credit, surety bonds
and insurance products.
Prior to the petition date and in compliance with the
Environmental Statutes, the Debtors procured surety bonds issued
by Frontier Insurance Company as Compliant Financial Assurance
for performance of closure, post-closure, and corrective action
activities at certain of their facilities. Of the total amount
of financial assurance required of the Debtors and their debtor
affiliates under the Environmental Statutes, which approximated
$500 million, about 50% of such requirements were satisfied
through assurances provided by Frontier in the form of surety
bonds. At the time the Debtors procured such financial assurance
from Frontier and until May 31, 2000, Frontier qualified as an
approved surety on federal bonds pursuant to Circular 570 of the
U.S. Treasury. The other 50% of the Debtors' Compliant Financial
Assurance was supplied via insurance products issued by Reliance
Insurance Company of Illinois. On December 15, 2000, in response
to concerns regarding the financial stability of Reliance, the
Debtors sought, and received, Judge Walsh's approval of an
agreement with Reliance, whereby a large portion of the policies
issued by Reliance were cancelled and replaced by policies
issued by Indian Harbor. That replacement program is nearly
Respondents were required to reestablish Compliant Financial
Assurance.
On June 6, 2000, the U.S. Treasury notified the public that
Frontier no longer qualified as an acceptable surety on federal
bonds and had been removed from Circular 570 on May 31, 2000.
Accordingly, effective May 31, 2000, the Debtors no longer had
Compliant Financial Assurance for those facilities identified as
Covered Facilities. Under applicable regulations, the Debtors
were required to obtain Compliant Financial Assurance within
sixty days and, in some states and under some regulations, more
quickly.
On September 5, 2000, certain of the Debtors entered into a
consent agreement with the United States Environmental
Protection Agency and certain participating states. The Consent
Agreement, by its terms, established certain deadlines by which
the Debtor-Respondents were to obtain Complaint Financial
Assurances. Pursuant to paragraph 20(d) of the Consent
Agreement, the Debtor-Respondents were required to obtain
Compliant Financial Assurance by December 15, 2000. On December
15, 2000, EPA conditionally extended the Compliant Financial
Assurance Deadline to February 28, 2001. On February 28, 2001,
EPA further extended the Compliant Financial Assurance Deadline
to April 30, 2001, which was the last date to which the
Compliant Financial Assurance Deadline could be extended under
the Consent Agreement Order.
On May 16, 2001, this Court approved an amendment to the Consent
Agreement. Under the terms of the Amendment, the Compliant
Financial Assurance Deadline was extended until July 31, 2001
for specified Covered Facilities listed on Attachment K to the
Amendment and September 30, 2001 for certain Covered Facilities
other than those listed on Attachment K, described as Other
Covered Facilities. Certain states that had retained
jurisdiction for affected facilities in their states accepted
these same deadlines.
On July 11, 2001, this Court approved the Insurance Program with
Indian Harbor, thereby enabling the Debtors to establish
Compliant Financial Assurance for those Covered Facilities
listed on Attachment K, known as the Attachment K Facilities.
By this Motion, the Debtors seek Judge Walsh's approval of the
Insurance Program in order to enable the Debtors to establish
Compliant Financial Assurance for certain of the Other Covered
Facilities that are not closed, but instead where waste
treatment, handling and/or storage activities are continuing,
which facilities are located in Arizona, Colorado, Louisiana and
Utah.
Terms Of The Indian Harbor Insurance Proposal
At the time the Debtors procured Compliant Financial Assurance
for the Attachment K Facilities, the Debtors and their insurance
brokers contacted all of the major carriers in the insurance
industry able to provide Compliant Financial Assurance of the
scale the Debtors require. The Debtors, the Debtors' lenders and
the Creditors' Committee selected Indian Harbor from amongst the
two insurers which provided proposals. At that time, Indian
Harbor also proposed to provide Compliant Financial Assurance
with respect to the Other Covered Facilities (Active). The Other
Covered Facilities (Active) consist of one landfill located in
Deer Trail, Colorado; a RCRA/TSCA storage, treatment and
disposal facility located in Clive, Utah (aka the
Grassy/Grayback Mountain disposal facility); a service center in
Phoenix, Arizona; an incinerator in Aragonite, Utah; a
wastewater treatment facility in Baton Rouge, Louisiana; and a
PCB and RCRA storage facility in Clive, Utah.
Indian Harbor has agreed to provide Compliant Financial
Assurance for the Other Covered Facilities (Active) through the
issuance of insurance policies with aggregate limits of up to
approximately $85,000,000. The policies that Indian Harbor will
provide accrue premium on an annual basis, but, as required by
applicable financial assurance regulations, the policies are
noncancellable except in narrow circumstances.
Under the Insurance Program, the Debtors must pay a premium in
an amount equal to two percent of the coverage obtained with
respect to the Other Covered Facilities (Active) in one
installment within thirty days of when the insurance policies
are bound. The premium is fully earned upon payment.
In addition, the Insurance Program requires the Debtors to post
collateral therefor. Under the current proposal, Indian Harbor
has required that the Debtors post letters of credit as
collateral in an amount equal to approximately 48.8% of the
total coverage provided on the Other Covered Facilities
(Active).
The Debtors are under a deadline from EPA to post Compliant
Financial Assurance at certain of the Other Covered Facilities
(Active) by November 5, 2001. The Debtors would, if the Court
approves this Motion, provide coverage on or about this deadline
for those Other Covered Facilities (Active) at Baton Rouge,
Louisiana, Phoenix, Arizona, the incinerator in Aragonite, Utah,
and the PCB and RCRA storage facility in Clive, Utah. The
Debtors have negotiated with the applicable regulatory
authorities, subject to this Court's approval, a further
extension until January 31, 2002 of the deadline to post
Compliant Financial Assurance at the remaining Other Covered
Facilities (Active), which are the landfill in Deer Trail,
Colorado and the RCRA/TSCA storage, treatment and disposal
facility in Clive, Utah. Thus, absent the express consent of the
Debtors' Secured Lenders to an earlier implementation date,
although the authority to enter into the Insurance Program at
the Other Covered Facilities (Active), including the Remaining
Facilities, is currently being sought herein, the Debtors would
likely not implement the Insurance Program and post the
collateral at the Remaining Facilities until that deadline.
The Debtors assure Judge Walsh they had no choice but to
reestablish Compliant Financial Assurance for their operating
facilities. Without such Compliant Financial Assurance, the
Debtors would be unable to provide their customers with the
crucial assurance that the Debtors' disposal of waste was in
compliance with environmental laws and regulations. By entering
into the Insurance Program, thereby re-establishing Compliant
Financial Assurance on the remaining operating facilities, the
Debtors are working to complete one of the critical steps on
their path to reorganization.
Indian Harbor currently provides Compliant Financial Assurance
to the Debtors. As noted above, this Court previously approved
the Debtors' entry into a similar program with Indian Harbor in
connection with the replacement of approximately $150 million of
Compliant Financial Assurance that was previously provided by
Reliance. Furthermore, this Court previously approved the
Debtors' entry into a similar program with Indian Harbor whereby
Indian Harbor provides Compliant Financial Assurance for the
Attachment K Facilities. Many of the aspects of the existing
Programs parallel the terms of the Insurance Program, including
the requirement that the Debtors post collateral in the form of
letters of credit and enter into related agreements with Indian
Harbor. (Safety-Kleen Bankruptcy News, Issue No. 21; Bankruptcy
Creditors' Service, Inc., 609/392-0900)
STONE ENERGY: S&P Keeps Watch On Ratings After Acquisition Deal
---------------------------------------------------------------
Standard & Poor's announced that the ratings for Stone Energy
Corp. (double-'B'-minus) remain on CreditWatch with positive
implications, following the company's announcement that it has
entered into an agreement to acquire various Gulf of Mexico-
producing oil and gas properties from Conoco Inc. through asset
and stock purchase agreements that could total up to $300
million. Depending on the outcome of Standard & Poor's
evaluation of the transaction, Stone's ratings may still be
upgraded.
Standard & Poor's believes that the acquisition of Conoco's
properties will strengthen Stone's business profile through the
diversification provided by a larger reserve base and an
increased portfolio of exploration and exploitation
opportunities, which could lead to significant production growth
in 2002.
In addition, the transaction should extend Stone's reserve life.
These benefits should be achieved at a unit cost that is
consistent with Stone's historic operating results. However, the
transaction, which will be initially debt-financed, will weaken
Stone's capital structure. Pro forma for the transaction (and
assuming that no preferential purchase rights are exercised),
total debt to total capital is likely to rise to 33% from 12%
and Standard & Poor's estimates that total debt to expected 2002
EBITDA will worsen to about 1.0-1.2 times from about 0.4x.
Credit measures may be stronger if current owners of the
properties exercise their preferential purchase rights.
Despite the drawback of higher debt leverage, Stone's capital
structure still will be substantially stronger than required for
its current rating even if it adds $300 million of acquisition-
related debt. Furthermore, the company has plans to reduce a
portion of the acquisition-related debt during the next 18
months with cash flow from operations.
Standard & Poor's will resolve the CreditWatch listing when the
transaction closes, which is expected in December 2001.
SWISSAIR: Deputy Chairman B. Hentsch Takes On New Group Duties
--------------------------------------------------------------
Benedict G. F. Hentsch, Deputy Chairman of the Swissair Group,
has placed all his time and resources at the Group's disposal
with immediate effect. He will be devoting himself primarily in
his new capacity to social support aspects of the present Group
restructuring. In a parallel move, he has stepped down from all
his duties at the Darier Hentsch & Cie private bank.
Benedict Hentsch has been a member of the Swissair Group Board
of Directors since 1989, and is currently its Deputy Chairman.
He will now be devoting his energies to social issues
surrounding the current resizing of the Swissair Group,
especially the provision of "Sozialplan" severance benefits
packages for the employees affected.
Hentsch's decision has been welcomed by Group Chairman & CEO
Mario Corti: "In view of our company's difficult situation and
the many social issues it will raise for our staff, I am very
grateful to Benedict Hentsch for taking on this vital task."
SWISSAIR: Group Cancels November 9 Shareholders' Meeting
--------------------------------------------------------
The SAirGroup Extraordinary Shareholders' Meeting scheduled for
November 9, 2001 has been cancelled in the light of the events
of the past few weeks.
In view of its present financial situation, SAirGroup will also
be unable to distribute its November mailing to its shareholders
or issue their Qualiflyer mileage vouchers for 2001. The Group
regrets having to take these measures, and hopes it may count on
its shareholders' understanding.
TEXAS PETROCHEM: S&P Affirms Low-B's On Declining Credit Quality
----------------------------------------------------------------
Standard & Poor's revised its outlook on Texas Petrochemicals
Corp. to negative from stable. At the same time, Standard &
Poor's affirmed its ratings on the company.
The outlook revision reflects deteriorating credit quality
measures due to weaker-than-expected operating and financial
performance.
Profitability and cash flow have been negatively impacted by
weak demand in key products such as butadiene, lower pricing,
and the negative effects of operational outages. The shortfall
in earnings could make it more difficult for the company to
strengthen credit protection measures in the near term.
The ratings continue to reflect the company's below-average
business position as a mid-tier petrochemical producer. Houston,
Texas-based Texas Petrochemicals is the largest North American
merchant producer of butadiene and specialty butylenes
chemicals, which are key ingredients for synthetic and specialty
rubber, plastics, lubricant additives, and coatings. The company
also is the third-largest producer of methyl tertiary-butyl
ether (MTBE), a commodity gasoline additive used as an oxygenate
in clean-burning fuels and as an octane enhancer.
Texas Petrochemicals' other positive credit attributes include
competitive cost positions, production flexibility, and long-
term customer relationships. The company's relatively narrow
scope of operations, meaningful cyclicality, relatively mature
product mix, and reliance on a single production facility are
overriding negative rating factors.
Supply contracts provide a degree of margin protection in some
of the company's more value-added products. However, demand for
these products can fluctuate with changes in business
conditions. In the long term, profitability could be hurt by
current legislative initiatives to curtail MTBE use (prompted by
health and environmental concerns regarding alleged water
contamination). If demand for MTBE drops significantly,
management would likely maximize MTBE cash flow and take steps
to reposition assets to produce other products.
The financial profile remains aggressive, with the ratio of
total debt (including holding company discount notes) to EBITDA
at about 5 times. Cash flow protection measures are weak for the
rating: the ratio of funds from operations to adjusted debt is
in the low teens and EBITDA interest coverage is less than 2x.
These key credit ratios are expected to improve in the next
one to two years, aided by a gradual recovery in business
conditions and operational performance. Acquisition activity is
not expected to be meaningful and capital expenditures should be
moderate. Funds from operations to adjusted total debt should be
in the mid- to upper-teen percentage range, while EBITDA
interest coverage should average 2.5x over the business cycle.
The company's liquidity is aided by availability under a
bank revolving credit facility, a manageable debt maturity
schedule. However, cash interest payments on holding company
debt begin January 2002.
Outlook: Negative
Failure to strengthen the financial profile over the
intermediate term could result in a downgrade.
Ratings Affirmed RATINGS
Texas Petrochemicals Corp.
Corporate credit rating BB-
Subordinated debt B
TEXON INT'L: Poor Short-Term Liquidity Spurs S&P's Junk Rating
--------------------------------------------------------------
As a result of concerns over the short-term liquidity position
of the U.K.-based footwear components manufacturer Texon
International PLC (Texon), Standard & Poor's today lowered its
long-term corporate credit and senior unsecured debt ratings on
Texon to triple-'C'-plus from single-'B' and to triple-'C'-minus
from single-'B'-minus, respectively.
At the same time, the ratings on Texon were placed on
CreditWatch with negative implications. The reason for the two-
notch differential is that the senior notes are structurally
subordinated to senior bank debt facilities and other
liabilities in operating subsidiaries.
The downgrade and CreditWatch placement reflect Standard &
Poor's concern that, as market conditions in North America and
Asia deteriorate, Texon's weak liquidity position is likely to
come under increasing pressure over the next few months,
bringing into doubt the ability of the company to make the
coupon payment due February 1, 2002, on its 10-year DM245
million ($112.6 million) bond due February 2008. The uncertain
future trading outlook is also expected to impact performance,
preventing the group from achieving improved credit measures in
2001.
Texon is a relatively small company, with sales of 151.9 million
pounds ($218.3 million) and EBITDA of 19.5 million pounds in the
12 months to June 30, 2001. Although the group operates within
the highly fragmented shoe component industry, it is a global
leader in its niche markets, producing insoles, stiffeners, and
other materials used in making footwear.
Nevertheless, the weakness of the financial profile, reflected
by EBITDA cash interest coverage of 1.7 times and total debt to
EBITDA of 5.7x for the 12 months ended June 30, 2001, leaves
Texon's liquidity position extremely vulnerable in a depressed,
highly competitive trading environment.
Standard & Poor's will monitor ongoing developments,
particularly the liquidity situation, with a view to resolving
the CreditWatch status.
USG CORP: Asks Court to Approve Retention & Severance Programs
--------------------------------------------------------------
USG Corporation contends that if it hopes to maintain its status
as an industry leader, it must retain Key Employees and provide
competitive, meaningful incentives and compensation for the
Company's management team.
USG reminds Judge Newsome that the uncontrollable, incredible
burden of asbestos-related liability resulting from products
whose production ceased long before current management was in
place is what created the financial and operational strain that
led to these chapter 11 cases.
Facing diminished employee morale prior to the Petition date led
the Debtors to put certain Key Employee Programs in place in May
2001. John H. Knight, Esq., at Richards, Layton & Finger, tells
the Court that the Debtors believe these Key Employee Programs:
(a) provide necessary incentives to retain key employees
while keeping in mind the financial constraints and
creditor obligations placed on chapter 11 debtors in
possession; and
(b) are well within the ranges of financial incentives
approved by courts in similar chapter 11 debtor
programs.
The Key Employee Programs' goals are to provide the Debtors' key
employees with enough incentive to (a) remain in their current
positions with the Debtors through the effective date of a plan
or plans of reorganization in these chapter 11 cases and (b)
assume the additional administrative and operational burdens
imposed on the Debtors by these chapter 11 cases.
The Debtors' major creditor constituencies, Mr. Knight informs
Judge Newsome, were involved in the extensive discussions from
which these programs arose. Mr. Knight also offers that, shortly
after their appointment, the Committees were also made aware of
the Debtors' Key Employee Programs through the dissemination of
huge amounts of information and other pertinent data. The Key
Employee Programs actually entail many of the Committees' and
professionals' ideas and suggestions and changes up to and
including the reduction in the overall cost of the originally
proposed plans. Though the Committees haven't fully endorsed
the implementation of the Programs, the Debtors' are certain
that definitive agreements can be reached.
Mr. Knight tells Judge Newsome that the Debtors are convinced
the Key Employee Programs will significantly benefit their
estates and creditors as the Debtors' employees' continued
loyalty and efforts will enhance their reorganization. It is for
these many reasons, the Debtors seek authority to implement the
Programs.
Immediate and exigent implementation of the Programs is
necessary for two reasons:
* First, the chapter 11 filings followed a prolonged
period of financial difficulty brought on by the increasing cost
of asbestos-related litigation and the decline in the market
price of the Debtors' common stock. There is no equity-based
compensation available to the key employees. As a result, the
Debtors' senior management is being compensated at 45% of the
comparable, competitive practice.
* Second, the Debtors' employee compensation packages,
with equity-based incentives available, were designed to be
competitive with industry norms and did not take into account
the additional complications of a bankruptcy.
Mr. Knight maintains the uncertainty that accompanies the
chapter 11 proceedings necessitates the Key Employee Plans'
implementation.
The Debtors are also concerned with the possibility of losing
their current management team to competing companies in the
industry, through aggressive recruitment. In ordinary
circumstances there is a risk of management becoming lateral
recruitment targets, but in the midst of the chapter 11
proceedings the risk is exacerbated and retention of these
widely-known employees through incentive programs is a must.
Losing these key employees would result in untold hours of
replacement recruiting, searching for qualified replacements,
relocation expenses and executive search fees, and the shift of
remaining management's focus to employing new executives at a
time when all focus should be on the Debtors' business
operations. Lastly, Mr. Knight contends that there would be
further attrition as other employees may follow suit, as morale
is damaged due to empty employee slots and increased workload on
remaining staff.
Arthur Andersen, LLP, designed the Key Employee Programs after
much research and based on competitive market conditions and
with much attention to cost.
Mr. Knight concludes that all elements of the Key Employee
Retention and Severance Programs are designed to meet specific
employee needs and are patterned after severance programs in
similar chapter 11 cases. The Debtors believe the proposed
retention and severance measures are necessary to retain their
key employees and maintain the Debtors' financial performance
throughout the reorganization process. (USG Bankruptcy News,
Issue No. 10; Bankruptcy Creditors' Service, Inc., 609/392-0900)
U.S. INDUSTRIES: Junk Ratings Remain On S&P Watch Positive
----------------------------------------------------------
Standard & Poor's ratings on U.S. Industries Inc. (USI) and
related entities remain on CreditWatch with positive
implications, awaiting definitive progress on the disposition of
at least a portion of the company's noncore businesses that are
currently for sale.
That development would enhance USI's prospects for meeting
substantial quarterly amortization of senior debt required under
the restructured bank facilities, which mature in November 2002.
Noncore units on the block include Ames True Temper lawn and
garden tools, Lighting Corp. of America commercial and
residential lighting products, Rexair premium vacuum cleaners
and other businesses.
Scheduled cumulative repayments are $75 million during the
period ending December 31, 2001; $200 million by March 31, 2002;
$450 million by June 30, 2002; and $600 million by October 15,
2002. As of June 30, 2001, total debt was $1.3 billion (pro
forma for the since-completed restructuring of USI's bank debt
and the $175 million bank debt of Rexair which was re-acquired).
Under the restructured credit facilities, total availability was
increased to $830 million, of which $704 million was
outstanding.
Assets of significant U.S. subsidiaries secure the senior notes
equally and ratably through a collateral trust. Senior notes
consist of $250 million due October 2003 and $125 million due
December 2006. Pro rata proceeds from the asset sales will
become cash collateral for the senior notes, and the balance of
proceeds will be used to pay down bank debt.
The company's financial flexibility is also enhanced moderately
by ownership of $157 million of notes of Strategic Industries
Inc., which could be monetized if necessary at a significant
discount from face value. Quarterly amortization payments would
bolster prospects that USI would be able to refinance its debt
before the October 2002 maturity. Asbestos liabilities do not
appear to present a material problem for many years.
Operating income (excluding a large noncash asset impairment
charge) is down substantially in 2001, reflecting in part lower
sales at the Jacuzzi bath and spa businesses, which have been
adversely affected by the weak economy. Much lower lawn and
garden profitability was the result of higher warehousing and
distribution costs due to above-normal inventory levels at Ames
True Temper and underabsorption of fixed costs as manufacturing
schedules were curtailed to reduce inventories. Inventory levels
were higher than expected due to the buildup necessary to stock
a new master distribution center and the delay of the
traditional spring selling season caused by inclement weather.
Total debt to EBITDA is more than four times and that ratio
could experience erosion near term, given depressed consumer
confidence.
It is uncertain whether the core bath and plumbing operations,
including the Jacuzzi and Zurn brand names, will have to be sold
in the next few months to meet coming maturities. Ratings
improvement depends on the intermediate-term earnings prospects
of the remaining businesses as well as USI's ability to monetize
at least a portion of its business portfolio.
Ratings Remaining on CreditWatch with Positive Implications
U.S. Industries Inc. Ratings
Corporate credit rating CCC+
USI American Holdings, Inc.
Senior secured debt CCC+
(obligor: U.S. Industries Inc.)
USI Global Corp
Senior secured debt CCC+
(obligor: U.S. Industries Inc.)
UNIQUE BROADBAND: Seeks to Add Former TSE President to Board
------------------------------------------------------------
Unique Broadband Systems, Inc. (CDNX: UBS) announced that
Rowland Fleming has agreed to stand for election to the
company's Board of Directors at its next shareholders' meeting
to be held on November 27, 2001.
Rowland Fleming will bring to the UBS Board of Directors a
wealth of experience gained during a career of over 35 years in
the financial services industry in Canada, the United States and
Europe and encompassing significant exposure to executive
management challenges in a variety of industries.
Mr. Fleming has served as President and CEO of the Toronto Stock
Exchange; Deputy Chairman, President and CEO of National Trust
Company; President and CEO of The Dominion of Canada General
Insurance Company; and Executive Vice-President of The Bank of
Nova Scotia.
Mr. Fleming currently serves on a number of corporate boards in
both the public and private sectors.
"We are very pleased that Mr. Fleming has agreed to stand for
election to our Board of Directors," said Patrick Lavelle,
interim President and CEO of UBS. "His abilities in the areas of
management and strategy, as well as his vast network of
relationships will no doubt enhance our ability to move the
Company forward in all aspects of its business."
Unique Broadband Systems, Inc. (UBS) designs, develops and
manufactures high-speed fixed and mobile wireless solutions
based on OFDM technology. UBS has offices in Canada, Denmark,
the UK and Italy.
Meanwhile, Unique Broadband Systems, Inc. (CDNX: UBS) has
completed the initial stage of its restructuring plan.
Under such plan, which is designed to focus the Company on its
core competencies and to significantly reduce operating costs,
the Company reduced the size of its transmission and waveguide
divisions, refocused the R&D department on a narrower, more
clearly defined assortment of products, reduced its operations
in Denmark and sold its Russian office.
The restructuring has resulted in the elimination of 68
positions in Canada, Denmark and Russia, representing a 40%
decrease in total employment.
VIZACOM: Completes Restructuring of Over $1MM of Current Debts
--------------------------------------------------------------
Vizacom Inc. (Nasdaq: VIZY), a provider of professional internet
and technology solutions, announced that it has restructured
over $1 million of its current liabilities, and thus satisfied
one of the key conditions to the execution of a definitive
agreement to acquire SpaceLogix, Inc., a privately held company
specializing in co-location, hosting and network management
solutions.
In reducing and restructuring approximately $1,500,000 of its
liabilities, Vizacom has taken the following steps, among
others:
* Vizacom has settled its pending arbitration with Early
Bird Capital Inc.
* Related Parties have agreed to salary and liability
reductions of over $500,000 and restructuring of
approximately $750,000 in liabilities.
Vizacom has received $450,000, the first two installments of a
series of bridge loans, from SpaceLogix. Pursuant to the
previously announced non-binding letter-of-intent for Vizacom to
acquire SpaceLogix, SpaceLogix has forward to Vizacom these
funds in the form of a secured bridge loan.
In aggregate, SpaceLogix is to extend to Vizacom a series of
secured bridge loans in an aggregate amount of $650,000, and in
connection therewith receive an aggregate of 400,000 shares of
Vizacom common stock.
Vizacom also announced that it has been advised in a letter
dated October 10, 2001, that a Nasdaq Listing Qualifications
Panel has determined to allow the Company to remain listed on
The Nasdaq SmallCap Market so long as the Company continues to
meet all Nasdaq listing requirements, including that at
September 30, 2001 the Company report financial results which
reflect either net tangible assets above $2,000,000 or, in the
alternative, stockholders' equity of at least $2,500,000.
Vizacom expects that this requirement will be satisfied at
September 30, 2001.
Vincent DiSpigno, Vizacom's President, commented, "With these
liability restructuring transactions, we have taken majors
steps toward significantly improving our balance sheet. The
willingness of current directors to contribute for the benefit
of the Company and its stockholders shows the commitment we have
to the Company's success. The SpaceLogix bridge
financing also shows both parties' commitment to the proposed
acquisition of SpaceLogix by Vizacom. This capital allows us to
better implement our business plans and also represents an
important initial step towards combining the strengths and core
competencies of both Vizacom and SpaceLogix."
Vizacom Inc. is a provider of comprehensive professional
internet and technology solutions. Through its Vizy Interactive
New York and PWR Systems subsidiaries, Vizacom develops and
provides to global and top domestic companies a range of service
and product solutions, including: business strategy formation,
web design and user experience, e-commerce application
development, creative media solutions, systems and network
development and integration, and data center services. Vizacom
attracts top, established companies as clients, including:
Martha Stewart Living, Verizon Communications, and Sony Music.
Visit http://www.vizacom.com
SpaceLogix, a privately-held, development-stage company,
currently offers telco grade, carrier-neutral co-location and
managed network services aimed at the fast-growing web hosting
market. Current customers include Morgan Stanley's MetroNexus
and Consolidated Edison Communications, Inc. These customers,
together with several other anticipated major financial service
and enterprise clients, are expected to represent the core of
SpaceLogix's customer base. By capitalizing on its strong
relationships with owners of data center facilities and major
telcos, and other third-party data center owners, SpaceLogix
intends to be a leading facilities-based managed services
provider.
As at June 30, 2001, Vizacom recorded total current liabilities
of $7 million, exceeding its current assets totaling $3.7
million.
WARNACO GROUP: Panel Wants More Time to Review Lenders' Liens
-------------------------------------------------------------
The Official Committee of Unsecured Creditors OF The Warnaco
Group, Inc. needs 90 more days to object to the validity,
perfection, priority or enforceability of the pre-petition
indebtedness; or assert any avoidance power claims or causes of
action against any of the pre-petition lenders.
According to Scott L. Hazan, Esq., at Otterbourg, Steindler,
Houston & Rosen, in New York, the Secured Lenders utilized their
obvious leverage to obtain substantial benefits and protections
during the negotiations for the post-petition credit facility.
Consequently, Mr. Hazan tells the Court, the Committee tried but
failed to persuade the Secured Lenders to meaningfully increase
the time period provided for the Committee to review the pre-
petition interests of the Secured Lenders.
The Final DIP Financing Order sets October 22 as the deadline
for filing challenges to the claims and liens of the Pre-
petition Lenders or assertions of any other causes of action
against the Pre-petition Lenders. But in a case of this
magnitude and considering the complexities of the financing
arrangements that the Committee must understand and review, Mr.
Hazan says, this period is insufficient for the Committee to
complete its investigation. Mr. Hazan explains that the
Committee's task involves review and analysis of:
(1) a complex $2,600,000,000 pre-petition credit facility
whereby on October 6, 2000, the unsecured indebtedness was
restructured and entirely collateralized within 8 months
of the Chapter 11 filing;
(2) 25 separate and distinct pre-October 6, 2000 credit
agreements and facilities;
(3) foreign and domestic collateral security and perfection
issues;
(4) inter-creditor and subordination issues;
(5) acquisition of a public company in November 1999, financed
by a $600,000,000 tender offer; and
(6) numerous other acquisition, financing and related
documents.
However, the Committee clarifies that its request for additional
time to complete its investigation and analysis is not based on
the failure of the Pre-Petition Lenders to cooperate with the
Committee. According to Mr. Hazan, the counsel for the Lenders
has been responsive to all of the Committee's requests. Mr.
Hazan also emphasizes that this is not a situation where the
Committee's professionals are not up to the task. Rather, Mr.
Hazan explains, it's a situation where the extent of the task
was not known, and could not have been known, until after the
final financing Order was entered and the Committee's
professionals started receiving and reviewing documentation.
Mr. Hazan informs the Court that during the requested extension,
the Committee anticipates scheduling and conducting Rule 2004
examinations and requesting and reviewing additional documents
in the possession of various of the Secured Lenders. The
Committee's goal is to complete a thorough and comprehensive
review of the pre-petition transactions and fulfill its
fiduciary duties that the Debtors relinquished, Mr. Hazan says.
It is not the Committee's desire nor in any of the constituents'
interest to delay or drag out the Committee's investigation, Mr.
Hazan assures Judge Bohanon.
Mr. Hazan observes that the sheer volume and extent of the
documents related to the credit facilities is staggering. In
addition, Mr. Hazan notes, the Debtors have a complex corporate
structure. So far, Mr. Hazan reports, the Committee has
reviewed transaction documents, conducted informal interviews,
analyzed security interests with respect to the various types of
collateral, and reviewed the Debtors' acquisition of Authentic
Fitness Corporation in 1999, among others.
Mr. Hazan claims that the Committee's efforts to complete the
investigation and review of the pre-petition financing
transactions have been substantial. The Committee's
professionals have earnestly worked towards completion of a
thorough and professional review, Mr. Hazan adds.
Without the extension, Mr. Hazan states that the Committee will
be required to finish its investigation before its completion,
possibly missing potential causes of action, which would inure
to the benefit of the Debtors' unsecured creditors. Mr. Hazan
also notes that the premature commencement of litigation would
cause the incurrence of significant legal and other expenses.
In balancing the equities, Mr. Hazan concludes, the Pre-Petition
Lenders will not be prejudiced by the short extension sought,
whereas denial of this Motion may have a devastating impact on
the Committee and general unsecured creditors.
Thus, the Committee asks Judge Bohanon extend an additional 90
days for them to investigate the Pre-Petition Lenders' claims
and liens. (Warnaco Bankruptcy News, Issue No. 11; Bankruptcy
Creditors' Service, Inc., 609/392-0900)
WEIRTON STEEL: CEO Says Recovery in Sight After ITC Ruling
----------------------------------------------------------
Weirton Steel Corp. (OTC Bulletin Board: WRTL) officials said
recovery by the domestic steel industry has been greatly
enhanced following Monday's affirmative vote by the U.S.
International Trade Commission (ITC) that a surge of steel
imports has seriously harmed the industry.
The vote paves the way for President Bush to possibly take
action early next year to curb the flow of steel imports into
U.S. markets. The ITC's action comes four months after it began
investigating the effects of steel imports on the U.S. steel
industry through Section 201 of the Fair Trade Act of 1974.
"We've waited a long time for this. Four years ago, we sounded
the alarm that increased import levels would damage our
industry, especially those that violated U.S. trade laws.
Hopefully, this fight may soon be over," said John H. Walker,
Weirton Steel president and chief executive officer.
Among the numerous domestic steel products that the ITC ruled
were adversely affected by imports were those produced by
Weirton Steel -- hot-rolled, cold-rolled, galvanized and
tinplate.
"Illegally priced imports drove steel selling prices down and
they haven't yet recovered. Action by the government could push
imports out of the marketplace and enable prices to recover, a
key to the industry's survival," Walker noted. "If there's no
government help, foreign steelmakers will continue to keep
prices low by again flooding our markets, especially when the
nation's economy improves. This will keep the vicious pricing
cycle alive."
The ITC has 60 days to develop and present remedies for
President Bush to consider in dealing with imports. The
remedies could include tariffs, quotas or orderly marketing
arrangements. The president could implement those remedies,
select his own solution or take no action.
In June, Bush formally asked the ITC to initiate an
investigation into increased levels of steel imports through
Section 201. A month later, the U.S. Senate Finance Committee -
- through the efforts of U.S. Sen. Jay Rockefeller, D-W.Va.,
adopted a similar 201 resolution which was sent to the ITC and
consolidated with the president's request.
The ITC recently concluded eight days of hearings with more than
100 individuals testifying for and against government
intervention.
"Evidence of damage to our industry and for government action
was overwhelming. Even considering the basics -- 24 steel
company bankruptcies in four years, 30,000 lost steel jobs and
record financial losses among producers -- these facts alone are
staggering and quite convincing," commented Walker, who
testified before the ITC.
Walker said the company soon will consult with its legal counsel
to determine Weirton Steel's input for three days of remedy
hearings before the ITC in November. Walker will testify and
offer his opinion regarding what action the Bush administration
should take to address the import problem.
The ITC will vote Nov. 30 on the remedies it will recommend to
the president. Bush has until Feb. 16 to make a decision. If
he does not act, Congress can adopt a resolution to accept the
recommendations by the ITC and take action itself.
"Weirton Steel is in the midst of a major restructuring plan.
We have done all the right things to keep this company going.
Action by President Bush would give us the added boost we need
to weather this storm and move forward as a long-term
competitor," Walker added.
"We thank the ITC for its vote and our employees for their
contributions and their patience through these difficult years.
Also, we thank those members of Congress who stood by us."
Weirton Steel is the eighth largest U.S. integrated steel
company.
WESTPOINT STEVENS: Denies Allegations in Class Action Lawsuit
-------------------------------------------------------------
WestPoint Stevens Inc. (NYSE: WXS) announced that a purported
class action lawsuit had been filed against the Company and
several individuals in the United States District Court for the
Northern District of Georgia. The action was brought by Norman
Geller, who identified himself as an individual investor, on
behalf of a putative class of purchasers who acquired the
Company's stock between February 1999 and October 2000.
The complaint alleges violation of the Securities Exchange Act
of 1934 through various misleading statements and SEC filings
made between February 1999 and October 2000. WestPoint Stevens
denies these allegations and intends to vigorously defend the
suit.
WestPoint Stevens Inc. is the nation's leading home fashions
consumer products marketing company, with a wide range of bed
linens, towels, blankets, comforters and accessories marketed
under the well-known brand names of GRAND PATRICIAN, PATRICIAN,
MARTEX, UTICA, STEVENS, LADY PEPPERELL, VELLUX and CHATHAM, and
under licensed brands including RALPH LAUREN HOME, DISNEY HOME,
SANDERSON, DESIGNERS GUILD, JOE BOXER and GLYNDA TURLEY.
WestPoint Stevens is also a manufacturer of the MARTHA STEWART
bed and bath lines. WestPoint Stevens can be found on the World
Wide Web at http://www.westpointstevens.com
WINSTAR COMMS: Battles with Savvis to Recoup $38.4M Receivables
---------------------------------------------------------------
Winstar and SAVVIS Communication Corporation are party to a
series of commercial agreements pursuant by which the Debtors
and SAVVIS bought and sold certain goods and services to each
other, including:
A. Master Agreement dated as of June 30, 2000 pursuant to which,
SAVVIS is obligated to purchase telecommunications
equipment from the Debtors for installation in certain
buildings. As required by the Master Agreement, SAVVIS
purchased certain telecommunications equipment from the
Debtors including certain radio pairs for $29,435,000. Of
this amount, SAVVIS paid only $4,731,254, thus leaving a
net balance of $24,703,746.
B. Professional Services Agreement dated as of June 30, 2000,
pursuant to which the Debtors provided certain domestic
professional services to SAVVIS. Under the terms of the
Agreement, SAVVIS was obligated to pay the Debtors
$10,000,000 for professional services provided by the
Debtors during the 2nd quarter of. SAVVIS paid $5,817,790 of
this amount but remains indebted to the Debtors in the
amount of $4,182,210 in respect of professional services
provided by the Debtors to SAVVIS under the PSA.
C. Installation Services Exhibit to the Master Services
Agreement under which, SAVVIS was obligated to pay
installation fees relating to certain telecommunications
equipment installed by the Debtors, specifically, for 28
Links accepted by SAVVIS at $30,000 per Link, for a total of
$840,000.
D. Equipment Operations and Maintenance Exhibit to the Master
Agreement, under which, the Debtors provided operation and
maintenance services to SAVVIS and for which SAVVIS has
failed to make payment. SAVVIS remains indebted to the
Debtors for operation and maintenance fees in respect of 28
Links and 4 collocation sites amounting to $255,212.
E. Basic Internet Services Agreement, dated as of June 30, 2000
under which the Debtors prepaid SAVVIS for certain basic
internet services that SAVVIS has failed to provide to the
Debtors. The total pre-paid by Winstar in respect of such
services and the amount SAVVIS owes to Winstar for having
failed to provide such services is $8,460,000.
The aggregate net total owed by SAVVIS to the Debtors pursuant
to the agreements described above is $38,441,168. Despite
demands from the Debtors that SAVVIS pay the outstanding amounts
due, SAVVIS has made no further payments.
To recover what they're owed, the Debtors initiated an Adversary
Proceeding against SAVVIS demanding that the Court:
A. order SAVVIS to immediately turn over to Winstar the amounts
due on the outstanding balance in the total amount sum of
$38,441,168, plus consequential damages in an amount to be
determined at trial, and interest and costs;
B. enter judgment in favor of Winstar and against SAVVIS in the
total amount of $38,441,168, plus consequential damages in
an amount to be determined at trial, and interest and
costs.
M. Blake Cleary, Esq., at Young Conaway Stargatt & Taylor LLP,
in Wlmington, Delaware, tells the Court that the sums owed to
the Debtors under the Agreements constitute property of the
Debtors' estate, which is being wrongfully withheld by SAVVIS.
Despite repeated demand made by the Debtors, SAVVIS has refused
to turn over the amounts owed, which is a willful violation of
the automatic stay and a material breach of the Master
Agreement.
By refusing to make payments to the Debtors, Mr. Cleary states
that SAVVIS has caused the Debtors damages in the amount of
$38,441,168 plus consequential damages in an amount to be
determined at trial, and costs and expenses that Winstar has
incurred in attempting to enforce its rights, including those
incurred in bringing this action. (Winstar Bankruptcy News,
Issue No. 16; Bankruptcy Creditors' Service, Inc., 609/392-0900)
* Meetings, Conferences and Seminars
------------------------------------
October 25, 2001
Practicing Law Institute
Bankruptcy Law & Practice Update: New Developments
in an Uncertain Economy
Broadcast live via satellite to over 70 locations
in the U.S.
Contact: 212-824-5811 or jsiegel@pli.edu
October 28 - November 2, 2001
IBA Business Law International Conference
Including Insolvency and Creditors Rights Sessions
Cancun, Mexico
Contact: +44 (0) 20 7629 1206
http://www.ibanet.org/cancun
November 15-17, 2001
ALI-ABA
Commercial Real Estate Defaults, Workouts, and
Reorganizations
Regent Hotel, Las Vegas
Contact: 1-800-CLE-NEWS or http://www.ali-aba.org
November 26-27, 2001
RENAISSANCE AMERICAN MANAGEMENT, INC. & BEARD GROUP
Seventh Annual Conference on Distressed Investing
The Plaza Hotel, New York City
Contact 1-903-592-5169 or ram@ballistic.com
November 29-December 1, 2001
American Bankruptcy Institute
Winter Leadership Conference
La Costa Resort & Spa, Carlsbad, California
Contact: 1-703-739-0800 or http://www.abiworld.org
December 7 and 8, 2001
American Bankruptcy Institute
ABI/Georgetown Program "Views from the Bench"
Georgetown University Law Center, Washington, D.C.
Contact: 1-703-739-0800 or http://www.abiworld.org
January 31 - February 2, 2002
American Bankruptcy Institute
Rocky Mountain Bankruptcy Conference
Westin Tabor Center, Denver, Colorado
Contact: 1-703-739-0800 or http://www.abiworld.org
January 11-16, 2002
Law Education Institute, Inc
National CLE Conference(R) - Bankruptcy Law
Steamboat Grand Resort, Steamboat Springs, Colorado
Contact: 1-800-926-5895 or
http://www.lawedinstitute.com
February 28-March 1, 2002
ALI-ABA
Corporate Mergers and Acquisitions
Renaissance Stanford Court, San Francisco, CA
Contact: 1-800-CLE-NEWS or http://www.ali-aba.org
March 3-6, 2002 (tentative)
NORTON INSTITUTES ON BANKRUPTCY LAW
Norton Bankruptcy Litigation Institute I
Park City Marriott Hotel, Park City, Utah
Contact: 770-535-7722 or Nortoninst@aol.com
March 8, 2002
American Bankruptcy Institute
Bankruptcy Battleground West
Century Plaza Hotel, Los Angeles, California
Contact: 1-703-739-0800 or http://www.abiworld.org
March 20-23, 2002
TURNAROUND MANAGEMENT ASSOCIATION
Spring Meeting
Sheraton El Conquistador Resort & Country Club
Tucson, Arizona
Contact: 312-822-9700 or info@turnaround.org
April 10-13, 2002 (tentative)
NORTON INSTITUTES ON BANKRUPTCY LAW
Norton Bankruptcy Litigation Institute II
Flamingo Hilton, Las Vegas, Nevada
Contact: 770-535-7722 or Nortoninst@aol.com
April 18-21, 2002
American Bankruptcy Institute
Annual Spring Meeting
J.W. Marriott, Washington, D.C.
Contact: 1-703-739-0800 or http://www.abiworld.org
April 25-27, 2002
ALI-ABA
Fundamentals of Bankruptcy Law
Rittenhouse Hotel, Philadelphia
Contact: 1-800-CLE-NEWS or http://www.ali-aba.org
May 13, 2002 (Tentative)
American Bankruptcy Institute
New York City Bankruptcy Conference
Association of the Bar of the City of New York
New York, New York
Contact: 1-703-739-0800 or http://www.abiworld.org
June 6-9, 2002
American Bankruptcy Institute
Central States Bankruptcy Workshop
Grand Traverse Resort, Traverse City, Michigan
Contact: 1-703-739-0800 or http://www.abiworld.org
June 27-30, 2002
NORTON INSTITUTES ON BANKRUPTCY LAW
Western Mountains, Advanced Bankruptcy Law
Jackson Lake Lodge, Jackson Hole, Wyoming
Contact: 770-535-7722 or Nortoninst@aol.com
July 11-14, 2002
American Bankruptcy Institute
Northeast Bankruptcy Conference
Ocean Edge Resort, Cape Cod, MA
Contact: 1-703-739-0800 or http://www.abiworld.org
August 7-10, 2002
American Bankruptcy Institute
Southeast Bankruptcy Conference
Kiawah Island Resort, Kiawaha Island, SC
Contact: 1-703-739-0800 or http://www.abiworld.org
October 9-11, 2002
INSOL International
Annual Regional Conference
Beijing, China
Contact: tina@insol.ision.co.uk or
http://www.insol.org
October 24-28, 2002
TURNAROUND MANAGEMENT ASSOCIATION
Annual Conference
The Broadmoor, Colorado Springs, Colorado
Contact: 312-822-9700 or info@turnaround.org
December 5-8, 2002
American Bankruptcy Institute
Winter Leadership Conference
The Westin, La Paloma, Tucson, Arizona
Contact: 1-703-739-0800 or http://www.abiworld.org
April 10-13, 2003
American Bankruptcy Institute
Annual Spring Meeting
Grand Hyatt, Washington, D.C.
Contact: 1-703-739-0800 or http://www.abiworld.org
December 3-7, 2003
American Bankruptcy Institute
Winter Leadership Conference
La Quinta, La Quinta, California
Contact: 1-703-739-0800 or http://www.abiworld.org
April 15-18, 2004
American Bankruptcy Institute
Annual Spring Meeting
J.W. Marriott, Washington, D.C.
Contact: 1-703-739-0800 or http://www.abiworld.org
December 2-4, 2004
American Bankruptcy Institute
Winter Leadership Conference
Marriott's Camelback Inn, Scottsdale, AZ
Contact: 1-703-739-0800 or http://www.abiworld.org
The Meetings, Conferences and Seminars column appears in the
Troubled Company Reporter each Wednesday. Submissions via
e-mail to conferences@bankrupt.com are encouraged.
*********
Bond pricing, appearing in each Monday's edition of the TCR, is
provided by DLS Capital Partners in Dallas, Texas.
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.
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.
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., Trenton, NJ USA, and Beard
Group, Inc., Washington, DC USA. Yvonne L. Metzler, Bernadette
C. de Roda, Ronald P. Villavelez and Peter A. Chapman, Editors.
Copyright 2001. 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 $575 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 ***