/raid1/www/Hosts/bankrupt/TCR_Public/030212.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, February 12, 2003, Vol. 7, No. 30
Headlines
ADELPHIA: Detroit Market Asset Sale Hearing Continues on Feb. 28
ADELPHIA COMMS: Earns Court Nod for Royal Insurance Stipulation
AES CORP: Fitch Ratchets AES Gener's Ratings Down a Notch to B+
ALASKA COMMS: Appoints Charles P. Sitkin to Board of Directors
AMERICA WEST: Eliminates Unprofitable Columbus Hub Operations
AMERICAN TRANS AIR: Names Vicki Higgins Director, Market Dev't
ANTARES PHARMA: Completes 10% Convertible Note Restructuring
ASSET SECURITIZATION: Fitch Cuts Ratings to Low-B & Junk Levels
B/E AEROSPACE: Arbitrators Give Decision on Thales Group Dispute
BUDGET GROUP: Wants Approval for Amended Cash Management System
BURLINGTON IND.: Inks Pact to Sell Assets to Berkshire Hathaway
CANNONDALE: Court Sets Final DIP Financing Hearing for Feb. 25
CEDAR BRAKES I & II: S&P Cuts Senior Secured Bond Ratings to B
CELLPOINT INC: Hires Michael Mathiesen as New President & CEO
COMDISCO INC: Angelo Gordon & Co. Discloses 6.33% Equity Stake
CONSECO FINANCE: Court Okays Dorsey & Whitney as Special Counsel
CONSECO: Court Okays Baker Botts as Special Litigation Counsel
CYBEX INT'L: Will Hold Q4 Earnings Conference Call Tomorrow
DECORATIVE SURFACES: Court Fixes Mar. 15 Admin. Claims Bar Date
DOW CORNING: Appoints Stephanie Burns as New President & COO
DUN & BRADSTREET: Will Not Raise Offer to Acquire Hoover's
EAST COAST POWER: S&P Ratchets Sr. Sec. Note Rating Down to BB+
EL PASO: S&P Keeps Watch on Ratings After Partner's Downgrade
EMERGING VISION: Sets Terms for Shareholder Rights Offering
ENCOMPASS SERVICES: Oakleaf Interest Sale to James Barnes Okayed
ENRON INC: Sells Recycling Business to Fiber Corp & All American
EOTT ENERGY: Court Approves Compromise with Big Warrior Corp.
GALEY & LORD: Hires Hart Corp. to Market North Carolina Property
GENTEK INC: Has Until June 9 to Make Lease-Related Decisions
GENUITY: Court Approves Professional Compensation Protocol
GLOBAL CROSSING: Seeks Go-Signal to Reject Headquarters Lease
GOLDFARB CORP: Lenders Agree to Amend Unit's Existing Loan Pact
GOODYEAR TIRE: Fitch Cuts Senior Unsecured Debt Ratings to B+
GREAT LAKES CARBON: Good Margin Management Spurs Outlook Change
HOCKEY CO.: Ends Talks About Buying Benetton Rollerblade Unit
HQ GLOBAL: Gets Plan Filing Exclusivity Extension Until May 13
HUNTLEIGH TELECOMMS: Case Summary & Largest Unsecured Creditors
I2 TECHNOLOGIES: Plans to Appeal Nasdaq Delisting Notification
INTERPUBLIC GROUP: Gets Commitment for New $500M Credit Facility
JAMES CABLE: Won't Make Feb. Interest Payment on 10-3/4% Notes
KASPER A.S.L.: Turns to Duff & Phelps for Valuation Assistance
MAIL-WELL INC: Says Improved Q4 Results in Line with Guidance
MAXXIM MEDICAL: Case Summary & 25 Largest Unsecured Creditors
MDC HOLDINGS: S&P Affirms BB+ Corporate Credit Rating
MIDLAND COGENERATION: Reports Improved Fourth Quarter Results
MISS. CHEMICAL: Commences Trading on OTCBB Under New MSPI Symbol
NATIONAL AIRLINES: US Trustee Wants Case Converted to Chapter 7
NATIONAL STEEL: U.S. Steel Commences Bargaining Talks with USWA
NAVISITE INC: Elects 3 Independent Members to Board of Directors
NETROM INC: Inks LOI to Acquire Tempest Asset Management
OCTEL CORP: December 31 Working Capital Deficit Tops $11 Million
ONE BAYOU PARK: Case Summary & Largest Unsecured Creditors
ORBITAL IMAGING: Wants to Stretch Exclusivity through May 19
OTTAWA SENATORS: Rod Bryden's Offer to Purchase Team Accepted
OTTAWA SENATORS: Melnyk Disappointed with Creditors' Decision
OWENS CORNING: Q4 Net Sales Slide-Up and Operating Loss Widens
PAN AMERICAN: Strong Performance Prompts S&P to Revise Outlook
PENTON MEDIA: Promotes Preston Vice to Chief Financial Officer
PEOPLES STORES: Directors Not Held Responsible for Bankruptcy
PIERSON TRUST: Case Summary & Largest Unsecured Creditor
RAND MCNALLY: Files Prepackaged Chapter 11 in Chicago
RESOURCE AMERICA: Taps Lazard to Explore Evening Star Bldg. Sale
RESOURCE AMERICA: Fitch Cuts Senior Unsecured Notes Rating to B-
ROWECOM INC: Sues divine to Recover Looted & Diverted Funds
SAIRGROUP FINANCE: Disclosure Statement Hearing Set for Feb. 20
SEITEL INC: Noteholders Extend Standstill Agreement to Feb. 14
SIERRA PACIFIC: Issuing $250MM Conv. Notes via Private Placement
SOCAL EDISON: Challenges FERC Settlement With Reliant Resources
SPECTRASITE: Emerges from Pre-Arranged Chapter 11 Restructuring
STANDARD MOTOR: Dana Buy-Out Spurs S&P to Keep Ratings Watch
SUN MEDIA: Ups Refinancing to C$735M on Strong Market Reception
TIERS CREDIT: S&P Puts BB- Class 2 Certs. Rating on Watch Neg.
TOKHEIM CORP: Danaher Pitches Best Bid for Gasboy Unit's Assets
UNITED AIRLINES: Court OKs Bank One DIP Financing on Final Basis
US AIRWAYS: Seeks Go-Signal to Reject Jacksonville Airport Lease
USG CORP: Royce & Associates Discloses 5.99% Equity Stake
WHEELING-PITTSBURGH: Seeks Avoidance Action Protocol Extension
WORLDCOM INC: Wants to Reject 86 Vacant SONET Ring Agreements
WORLDPORT COMMS: W.C.I. Acquisition Further Extends Tender Offer
YUM! BRANDS: Fourth Quarter 2002 Results Show Marked Improvement
ZENITH INDUSTRIAL: Wants to Extend Plan Exclusivity Until June 7
* Meetings, Conferences and Seminars
*********
ADELPHIA: Detroit Market Asset Sale Hearing Continues on Feb. 28
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The Detroit Market asset sale hearing is adjourned to
February 28, 2003 at 9:45 a.m.
As previously reported, Adelphia Business Solutions, Inc., and
its debtor-affiliates, together with their financial advisors,
Jefferies & Co., actively marketed and solicited bids for the
various telecommunications assets and related executory
contracts and unexpired leases associated with the markets that
they intend to close. These extensive marketing efforts
recently resulted in the approved sale to Gateway Columbus, LLC
of assets relating to certain of the previously closed markets.
Similar marketing efforts by the ABIZ Debtors have resulted in
the execution of a proposed asset purchase agreement for certain
assets related to the Detroit metropolitan area.
Pursuant to the Agreement, the ABIZ Debtors have agreed to sell
certain assets, and assume and assign certain executory
contracts and unexpired leases to Global Visions Communications
LLC, for $2,450,000, plus the assumption of certain contractual
liabilities. The sale is subject to higher and better offers
that may be received as a result of an auction. Global Visions
has already deposited $245,000 -- i.e., 10% of the Purchase
Price -- with the designated escrow agent pursuant to an escrow
agreement executed by the parties. The Earnest Money Deposit
will be refunded to Global Visions after the closing of the
proposed Sale Transaction.
During the period commencing on August 5, 2002 and concluding on
January 31, 2003, Global Visions will pay to the Debtors
$420,000 to compensate them for all commercially reasonable
interim operating expenses relating to the Sale Assets and the
Assumed Liabilities. The Aggregate Burn Amount is an additional
component of the total consideration. In the event the Closing
Date occurs prior to January 31, 2003, the Aggregate Burn Amount
will be decreased by $2,794.52 per day, and if the Closing Date
is after January 31, 2003, then the Aggregate Burn Amount will
be increased by $2,794.52 per day until the Closing occurs.
The proposed sale of the Assets is well within the Debtors'
sound business judgment. Several months ago, the Debtors
announced their intention to discontinue operations in the
Detroit Market because it is not part of their future business
plans.
The Debtors believe that any net sale proceeds realized from the
Auction will represent the fair market value for the Sale Assets
and that the Auction is the most appropriate mechanism to
generate maximum value from the closure of the Detroit Market.
Notwithstanding the extensive marketing process that the
Debtors, with the assistance of its financial experts, have
undertaken over the last several months, they believe that an
auction for these assets is in their best interests and will
ensure that the highest and best offer is obtained. (Adelphia
Bankruptcy News, Issue No. 28; Bankruptcy Creditors' Service,
Inc., 609/392-0900)
ADELPHIA COMMS: Earns Court Nod for Royal Insurance Stipulation
---------------------------------------------------------------
Adelphia Communications and its debtor-affiliates sought and
obtained Court approval of a stipulation with Royal Insurance
Company to settle their disputes.
Shelley C. Chapman, Esq., at Willkie Farr & Gallagher, in New
York, informs the Court that Royal provided the ACOM Debtors
with commercial general liability policy, commercial automobile
policies and workers' compensation policies. Pursuant to the
insurance policies, Royal is conducting an audit to determine
the amount of premium owed by the ACOM Debtors to Royal in
connection with the 2000 Policies. The ACOM Debtors were
scheduled to make a $6,029,533 premium payment to Royal, which
was to be received by Royal no later than August 26, 2002. The
ACOM Debtors require the continued coverage from Royal pursuant
to the Policies.
The parties previously agreed that, rather than the Debtors
making the 2002 Premium Payment, the Debtors would only make a
$2,000,000 payment to Royal on September 3, 2002 and a first
monthly installment payment of $1,007,383.25 on September 16,
2002, leaving a $3,022,149,75 balance plus applicable
assessments and state surcharges.
Terms of the stipulation are:
A. The Debtors will make the remainder of the 2002 Premium
Payment plus estimated taxes in equal, monthly installments
of $1,007,383.25 on October 16, 2002, November 16, 2002 and
December 16, 2002, with these payments to be received by
Royal within 10 days of each Due Date, it being understood
and agreed that the Debtors will pay all applicable
assessments and state surcharges separately from the base
monthly installment of $1,007,383.25;
B. After the completion of the 2000 Audit and the 2002 Audit,
Royal will submit to the Debtors the applicable reports and
information, as has been customarily provided by Royal to
the Debtors;
C. After the submission of the 2000 Audit Report and the 2002
Audit Report by Royal to the Debtors, the Debtors will have
30 days to reconcile these reports. Thereafter, unless, in
good faith, the Debtors dispute the results of either of
2000 Audit Report or the 2002 Audit Report, the parties
will net the amounts owing pursuant to the 2000 Audit
Report and the 2002 Audit Reports; and
D. The Net Amount Due will be paid to the applicable party
within ten days of the completion of the Reconciliation
Period. If a good faith dispute arises between the parties
as to either the 2000 Audit Report or the 2002 Audit
Report, the parties will avail themselves of the remedies
in the applicable Policies. After a resolution of this
dispute or an agreement of the parties, the setoff and
payment will be made. (Adelphia Bankruptcy News, Issue No.
28; Bankruptcy Creditors' Service, Inc., 609/392-0900)
Adelphia Communications' 10.875% bonds due 2010 (ADEL10USR1) are
trading at about 42 cents-on-the-dollar, says DebtTraders. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=ADEL10USR1
for real-time bond pricing.
AES CORP: Fitch Ratchets AES Gener's Ratings Down a Notch to B+
---------------------------------------------------------------
Fitch Ratings downgraded the senior unsecured local and foreign
currency ratings of AES Gener S.A., to 'B+' from 'BB-' and the
Chilean national scale rating to 'Chl BB+' from 'Chl BBB-'. The
ratings have been assigned a Negative Rating Outlook. The
downgrade and rating outlook primarily reflect a continued delay
in selling assets, near term liquidity constraints and longer-
term refinancing concerns.
The company's negotiations regarding the sale of certain Central
American investments have been delayed. An agreement may no
longer be reached in time to mitigate liquidity concerns for the
second half of 2003. The company has been analyzing other
alternatives to generate cash. The recent refinancings plus
semiannual interest payments on the US$503 million convertible
bond and US$200 million Yankee bond have resulted in total
required debt service payments in 2003 of approximately US$134
million (at Gener, TermoAndes/InterAndes and Energy Trade and
Finance Corp.), excluding any debt reduction related to asset
sales. The company ended 2002 with a cash balance of
approximately US$14 million. Sources of near-term cash include
operating cash flow as well as dividends from its Chilean
subsidiaries based on 2002 results. Through September 2002, the
most recent financial information available, Gener reported
EBITDA-to-interest of 2.2 times with total consolidated
leverage, as measured by debt-to-EBITDA, of 6.1x, an improvement
from 1.8x and 7.0x, respectively, as of year-end 2001.
In addition to the restructured bank debt, Gener has bullet
maturities of approximately US$503 million of convertible bonds
due March 2005 and US$200 million of Yankee bonds due January
2006. The company is currently pursuing refinancing alternatives
since operating cash flow alone is insufficient to fully repay
this debt at maturity.
The operating fundamentals of Gener reflect the company's solid
position as the largest thermal generator in the Chilean
electricity market, its diverse portfolio of generating plants,
its strategy of focusing on core electricity generation in
Chile, a soundly administered regulatory system, an economically
strong and growing service area, and experienced management.
Gener further benefits from its project-like structural
characteristics, including long-dated power purchase agreements
with financially strong customers and fuel supply contracts that
reduce business risk. These strengths may eventually be eroded
should the company be forced to divest additional Chilean
assets.
AES Corporation's 10.250% bonds due 2006 (AES06USR1), says
DebtTraders, are trading at about 46 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=AES06USR1for
real-time bond pricing.
ALASKA COMMS: Appoints Charles P. Sitkin to Board of Directors
--------------------------------------------------------------
Alaska Communications Systems Group, Inc., (Nasdaq:ALSK) the
leading integrated communications provider in Alaska, appointed
Charles P. Sitkin to its Board of Directors. Mr. Sitkin will
also serve as a member of the Company's Audit Committee.
Mr. Sitkin has over thirty-seven years of management consulting
experience and, since 1994, has been an independent consultant,
assisting enterprises with strategic and organizational
planning. Prior to 1994, Mr. Sitkin's experience included being
the National Director of Management Consulting at R.W. Beck and
Associates, a Partner at Arthur Young & Company, and various
leadership positions at the Boeing Company. Mr. Sitkin is a
Certified Management Consultant and is a graduate from Lafayette
College and the University of Washington.
"We are very glad to have a person of Chuck's caliber become a
member of our board. His significant experience in leadership
positions and his strong finance background will be of great
value to the future direction of our company," said Chuck
Robinson, Chairman and CEO of ACS.
ACS is the leading integrated communications provider in Alaska,
offering local telephone service, wireless, long distance, data,
and Internet services to business and residential customers
throughout Alaska. ACS currently serves approximately 327,000
access lines, 82,000 cellular customers, 67,000 long distance
customers and 47,000 Internet customers throughout the State.
More information can be found on the Company's Web site at
http://www.alsk.com
As reported in Troubled Company Reporter's January 20, 2003
edition, Standard & Poor's lowered its corporate credit ratings
on diversified communications company Alaska Communications
Systems Group Inc., and subsidiary Alaska Communications Systems
Holdings Inc., to 'BB-' from 'BB'.
The downgrade is based on competitive pressure that has
materially weakened ACS's business profile, impaired operating
performance, and resulted in credit measures that have not met
Standard & Poor's expectations for the ratings.
The ratings were removed from CreditWatch, where they were
placed on July 31, 2002. The outlook is negative. Anchorage,
Alaska-based ACS had $606 million debt as of Sept. 30, 2002.
Standard & Poor's also said that without stabilization of the
local exchange business, the ratings could be lowered further.
AMERICA WEST: Eliminates Unprofitable Columbus Hub Operations
-------------------------------------------------------------
America West Airlines (NYSE: AWA), the nation's second largest
low-fare airline, is eliminating hub operations in Columbus,
Ohio, and, as a result, phasing 12 regional jets out of the
America West Express fleet.
"The airline industry continues to face very difficult economic
conditions, and the outlook for the foreseeable future offers
little relief," said Douglas Parker, chairman and chief
executive officer. "A necessary and critical component of
restoring industry profitability is the elimination of
consistently unprofitable flying. While it's clear that the
airline industry's hub-and-spoke system is here to stay, it is
also clear that we, as an industry, have far too many hubs.
"America West simply will not retain unprofitable portions of
its operation in hopes that things might one day get better. To
that end, we have made the decision to discontinue utilizing
Columbus as a hub within the America West network and to
concentrate our assets in our stronger hubs in Phoenix and Las
Vegas," added Parker. "This is a most difficult decision for us
because it impacts our loyal customers, the city of Columbus
and, most importantly, our employees. However, as we look ahead
it is clear that this is the right decision -- a step we must
take to enhance America West's financial position, which will
benefit everyone associated with our airline in the long run."
While it no longer will be a hub, Columbus will remain an
integral part of America West's network as a field station, or
destination city. Between early April and mid-June, America West
will gradually downsize the hub to a planned four mainline
flights per day to Phoenix and Las Vegas. Today, Columbus
accounts for 49 daily departures to 15 destinations.
"America West established Columbus as part of a strategy to
connect passengers within the southern and central United States
to East Coast markets," said Scott Kirby, executive vice
president, Sales and Marketing. "However, as flights from our
primary hubs of Phoenix and Las Vegas grew to major East Coast
markets, the value of Columbus as a connecting hub has
diminished."
According to Kirby, a number of other factors have also changed
in recent years. "Due to the large number of regional jets now
deployed by many airlines throughout the east, an abundance of
capacity exists relative to demand in the markets served by
Columbus today. Additionally, Columbus has seen a much larger
decline in profitability during this economic downturn than the
rest of our system."
As a result, he said, despite America West's best efforts to
improve financial performance, the airline is incurring losses
of approximately $25 million per year from its Columbus hub
operations.
As part of the downsizing of the hub, beginning April 1 America
West will phase 12 Columbus-based regional jets, all of which
are currently operated by Chautauqua Airlines under the America
West Express banner, out of its fleet. The aircraft, which form
the nucleus of America West's hub in Columbus, are scheduled to
be fully transitioned out of the fleet by mid-June. All 12 jets
will remain with Chautauqua.
"Chautauqua Airlines has been a valuable partner to America West
in Columbus, and we regret having to end our very close
relationship," said Kirby. "As a regional partner to other major
airlines, Chautauqua understands the difficulties facing our
industry and has been very supportive of our position."
About 65 America West employees will remain in Columbus. The
remainder of the approximately 400 Columbus-based employees will
be offered the opportunity to transfer to other positions within
America West. Those who choose not to relocate will receive
severance packages.
"We take this action with particularly mixed emotions," said
Parker. "Our employees in Columbus are outstanding. They've done
a great job over the years of building a hub, representing
America West in the community and providing wonderful service to
our customers. We are hopeful that all of them will remain a
part of the America West team. Those choosing not to will be
treated fairly and with respect.
"Likewise, business and political leaders in Columbus and
throughout Ohio have been incredibly supportive of America West.
Fortunately for the people of Columbus, America West faced major
airline competition on nearly every route that we are
discontinuing, so the city will not lose significant non- stop
service to any market."
With the downsizing of Columbus, America West must eliminate
service to New York City LaGuardia Airport because perimeter
rules at that airport prohibit flights beyond 1,500 miles. This
precludes service from America West's hubs in Phoenix and Las
Vegas. However, the airline will continue to serve the New York
metropolitan area through both John F. Kennedy and Newark
International Airports. With the exception of LaGuardia, no
other year-round America West destination will be closed as a
result of the elimination of the Columbus hub.
In the first quarter of 2003 the company expects to record a
pre-tax special charge of approximately $10 to $15 million
resulting from the elimination of its Columbus hub operations.
The charge is related to the costs to terminate certain
contracts, the write-off of leasehold improvements and employee
transfer and severance expenses.
As previously reported in the Troubled Company Reporter,
Standard & Poor's raised America West's junk corporate credit
rating to 'B-'.
AMERICAN TRANS AIR: Names Vicki Higgins Director, Market Dev't
--------------------------------------------------------------
American Trans Air, Inc. (Nasdaq:ATAH), the nation's 10th
largest passenger airline, announced that Vicki Higgins has been
named Director of Market Development.
"Vicki is a proven asset to ATA and possesses the essential
skills needed for this newly created position," said Don
Moonjian, ATA's Vice President of Marketing. "Her expertise in
market development will continue to help the Company obtain a
heightened level of awareness within each of our markets."
Vicki joined ATA as Manager of Promotions in 2001. She
previously worked for the Indiana Pacers organization for 10
years. In her newly appointed position, Vicki will continue to
oversee event marketing, sponsorships, charitable contributions,
community relations, and ATA's Anniversary Travel Awards, the
carrier's frequent flyer promotion.
A native of Indianapolis, Vicki graduated from Indiana State
University, and completed her graduate studies earning an M.B.A.
from Indiana Wesleyan University.
Now celebrating its 30th year of operation, ATA is the nation's
10th largest passenger carrier based on revenue passenger miles.
ATA operates significant scheduled service from Chicago-Midway
and Indianapolis to over 40 business and vacation destinations.
For more information about the Company, visit the Web site at
http://www.ata.com
* * *
As reported in Troubled Company Reporter's January 22, 2003,
edition, Standard & Poor's affirmed its 'B-' corporate credit
ratings on ATA Holdings Corp., and subsidiary American Trans Air
Inc., and removed them from CreditWatch, where they were placed
September 13, 2001. However, Standard & Poor's lowered its
ratings on various enhanced equipment trust certificates. The
outlook is negative.
"The ratings were affirmed due to ATA's improved liquidity after
receipt of proceeds from a $168 million loan that was 90% backed
by a federal loan guarantee that closed in November 2002," said
Standard & Poor's credit analyst Betsy Snyder. Although the
company's liquidity has been enhanced, its fate will still
depend on the expected recovery in the airline industry.
Prolonged weakness in the industry would negatively affect ATA
and could result in a downgrade. "The downgrades of ATA's
enhanced equipment trust certificates reflect the substantial
deterioration in market values of the Boeing 757-200 aircraft
which form their collateral," Ms. Snyder noted. These planes,
while efficient and widely used, have been under pressure
following the shutdown of discount carrier National Airlines
(which operated solely B757's), US Airways Inc.'s bankruptcy
rejection and renegotiation of financings on its B757-200's, and
bankrupt United Air Lines Inc.'s attempts to reduce debt service
costs on many of its aircraft-backed obligations, including
those that finance B757-200's.
The ratings reflect ATA Holdings' substantial and growing debt
and lease burden and the price competitive nature of the markets
it serves.
ANTARES PHARMA: Completes 10% Convertible Note Restructuring
------------------------------------------------------------
Antares Pharma, Inc., (Nasdaq: ANTR) completed the retirement of
its outstanding 10% convertible debentures issued in July 2002.
This has been achieved by the Company issuing replacement senior
secured convertible debentures with warrants to two of the
original holders of the July 2002 debentures to cover the
remaining unconverted portion of those debentures, accrued
interest and a redemption payment to the other two holders of
the original debentures. The replacement debentures were issued
with a fixed conversion price, a longer maturity and a lower
interest rate than the previous debt. As part of the
restructuring, the Company issued warrants, which are callable
by the Company subject to the achievement of certain milestones.
Duncan Capital LLC of New York advised Antares Pharma on the
debt restructuring.
The Xmark Funds, a New York-based biotechnology investment firm,
are the principal holders of the replacement debentures. David
C. Cavalier, Chief Operating Officer of Xmark, said, "We believe
this restructuring will significantly enhance Antares Pharma's
financial stability and will position the Company well for
future financing."
Dr. Roger Harrison, CEO and President of Antares Pharma, said,
"With this debt restructuring, the Company will be able to focus
on pursuing new business opportunities and strategic
relationships.
"We believe that Antares Pharma's technologies and three-pronged
approach to drug delivery across the skin -- mini-needle
devices, needle-free devices and transdermal gels -- uniquely
position our Company to overcome barriers to effective drug
delivery by other routes and also to improve patient compliance
with treatment," added Dr. Harrison. "As representative of our
continued progress, we recently announced the extension of our
option agreement with Eli Lilly and Company, pursuant to which
Lilly has been exploring our needle-free device technology for a
number of products in its portfolio. We have also announced
further progress in clinical evaluation of our transdermal gel
products with our partners, BioSante Pharmaceuticals, Inc. and
Solvay Pharmaceuticals B.V. In addition, Ferring Pharmaceuticals
A/S has recently launched the latest version of our reusable
needle-free device, the VISION(R), in Europe. And we are
pursuing several other strategic relationships that also appear
promising."
Antares Pharma develops pharmaceutical delivery systems,
including needle- free and mini-needle injector systems and
transdermal gel technologies. These delivery systems are
designed to improve both the efficiency of drug therapies and
the patient's quality of life. The Company currently distributes
its needle-free injector systems for the delivery of insulin and
growth hormone in more than 20 countries and an estradiol
transdermal patch for hormone replacement therapy. In addition,
Antares Pharma has five products under development and is
conducting ongoing research to create new products that combine
various elements of the Company's technology portfolio. Antares
Pharma has corporate headquarters in Exton, Pennsylvania, with
production and research facilities in Minneapolis, Minnesota,
and research facilities in Basel, Switzerland.
For more information, visit Antares Pharma's Web site at
http://www.antarespharma.com
ASSET SECURITIZATION: Fitch Cuts Ratings to Low-B & Junk Levels
---------------------------------------------------------------
Fitch Ratings downgrades Asset Securitization Corp.'s commercial
mortgage pass-through certificates, series 1997-D5 as follows:
$39.5 million class B-1 to 'B' from 'B+' and $39.5 million class
B-2 to 'CCC' from 'B'. These classes will also remain on Rating
Watch Negative. Classes B-3, B-4 and B-5 respectively rated
'CC', 'C' and 'C', will also remain on Rating Watch Negative. In
addition, Fitch affirms the following classes: $27.2 million
class A-1A, $172.6 million class A-1B, $713 million class A-1C,
$229.8 million class A-1D, $52.6 million class A-1E and
interest-only classes A-CS1 and PS-1 at 'AAA', $87.7 million
class A-2 at 'AA', $52.6 million class A-3 at 'A+', $26.3
million class A-4 at 'A', $39.5 million class A-5 at 'BBB',
$43.9 million class A-6 at 'BB+' and $21.9 million class A-7 at
'BB'. The $17.4 million class B-6 is rated 'D' due to principal
realized losses. Fitch does not rate the class A-8Z
certificates. The actions follow Fitch's annual review of the
transaction, which closed in October 1997.
The classes B-1 through B-5 will remain on Rating Watch Negative
due to interest shortfalls that are expected to continue as the
primary contributor of the shortfalls, the Hyde Park loan, is
outstanding. The law suit filed on behalf of the trust against
the depositor and mortgage loan seller to have the loan
repurchased is expected to continue throughout 2003.
Prompting the downgrades were the increased number of Fitch
loans of concern and expected losses on the existing loans of
concern. There are several old Builder's Square properties and
Kmart properties whose leases to Kmart Corporation were rejected
in bankruptcy. The aggregate loss severity on the loans secured
by these properties is expected to be in excess of 50% of the
loan amount. In addition to the Kmart loans, there are several
other loans in the pool that are expected to experience losses.
While there has been a decline in the pool performance due to
the increased loans of concern, five loans in the pool maintain
investment grade credit assessments. The Saul Centers pool, 3
Penn Plaza, the Fath Multifamily pool, Swiss Bank Tower and the
Comsat loans continue to exhibit strong performance. One loan,
the Westin Casuarina Resort, declined in performance prompting
Fitch to lower its credit assessment to below investment grade.
The hotel, located in the British West Indies, suffers due to a
decline in tourism and a sluggish economy.
CapMark Services, L.P., the master servicer, collected 96% of
trailing twelve months operating statements for the loans in the
pool. The resulting weighted average debt service coverage ratio
is 1.58 times, which is a decline from 1.67x as of Fitch's last
review, but is still an increase over the 1.49x reported at
issuance.
Fitch will continue to monitor this transaction for developments
on the Hyde Park repurchase claim, the loans in special
servicing and any other issues that may arise.
B/E AEROSPACE: Arbitrators Give Decision on Thales Group Dispute
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B/E Aerospace, Inc., (Nasdaq:BEAV) received a decision from an
arbitration panel that was convened to hear the company's
dispute with a wholly owned subsidiary of The Thales Group.
The decision reduces the amounts B/E originally sought in
connection with the dispute, resulting in a net amount of $7.8
million due to B/E.
The dispute, described in more detail in B/E's filings with the
Securities and Exchange Commission, concerned the sale of B/E's
in-flight entertainment business to Thales. Under the terms of
the purchase and sale agreement, B/E received $62 million during
1999, and was to receive two additional payments totaling $31.4
million, and a third and final payment based on actual sales and
bookings. Thales did not pay the $31.4 million, or the third and
final payment. B/E initiated arbitration proceedings to compel
payment in December 2000. Thales counterclaimed against B/E,
alleging various breaches of the purchase and sale agreement.
In connection with the decision, B/E will record a non-cash
charge to earnings of approximately $30 million for the period
ended December 31, 2002. Previously, B/E had recorded a
receivable of $38.5 million in connection with the sale of the
business to Thales. The charge announced today represents the
difference between the panel's award and B/E's previously
recorded amounts.
"We are very surprised by the arbitration panel's findings,"
said Mr. Robert J. Khoury, President and Chief Executive Officer
of B/E. "We disagree with the decision and the amount of the net
award to B/E, and are evaluating our options with respect to the
decision."
The Thales Group is a publicly traded French company.
B/E Aerospace, Inc., is the world's leading manufacturer of
aircraft cabin interior products and a leading aftermarket
distributor of aerospace fasteners. With a global organization
selling directly to the world's airlines, B/E designs, develops
and manufactures a broad product line for both commercial
aircraft and business jets and provides cabin interior design,
reconfiguration and conversion services. Products for the
existing aircraft fleet -- the aftermarket -- provide almost
two-thirds of sales. For more information, visit B/E's Web site
at http://www.beaerospace.com
As reported in Troubled Company Reporter's Tuesday Edition,
Moody's Investors Service lowered its ratings for B/E Aerospace,
Inc.:
Rating Actions To From
* $250 million 8.875% senior subordinated Caa2 B3
notes, due 2011
* $250 million 8% senior subordinated Caa2 B3
notes, due 2008
* $200 million 9.5% senior subordinated Caa2 B3
notes, due 2008
* Senior implied rating B2 B1
* Issuer rating B3 B2
Outlook is stable.
The ratings downgrade mirrors B/E's ongoing poor financial
performance, deteriorating debt protection measures, and present
corporate restructuring, plus the constant challenges faced by
the airline industry.
BUDGET GROUP: Wants Approval for Amended Cash Management System
---------------------------------------------------------------
Edmon L. Morton, Esq., at Young Conaway Stargatt & Taylor LLP,
in Wilmington, Delaware, recounts that pursuant to the Asset and
Stock Purchase Agreement, Cherokee acquired "all bank accounts
and lock-box accounts related to the Acquired Business or held
by any Acquired Company," which included substantially all of
Budget Group Inc., and its debtor-affiliates' bank accounts
located in the United States, Canada, the Caribbean, Latin
America, and the Asia-Pacific Region. Certain accounts related
to the Debtors' retained Europe, Middle East and Africa
Operations have remained property of the Debtors' estates.
Mr. Morton reports that the Debtors have also established these
accounts with Harris Trust & Saving Bank, each of which is held
in the name of the BRAC Group, Inc.:
-- a "General Account";
-- a "Tax Reserve Account"; and
-- a segregated interest bearing account from which cure
costs arising on or prior to the Closing will paid, as
required by the Sale Order -- the Cure Reserve Account.
These New Accounts have each been established as a "Debtor-in-
Possession" account in compliance with Local Bankruptcy Rule
1007-2(a) and the guidelines established by the United States
Trustee.
Since the closing of the North American Sale, Mr. Morton relates
that the Debtors now maintain a more significantly streamlined
cash management system than the one maintained prior to the
Closing. The Debtors believe that the Amended Cash Management
System is appropriately tailored to the ongoing needs and
obligations of the estates.
Mr. Morton informs the Court that the Amended Cash Management
System outside of the U.S. -- held through the debtor subsidiary
BRACII -- remains similar to the structure described in the
Initial Cash Management Motion. The Debtors currently maintain
seven accounts in the U.K. and two accounts in Switzerland.
BRACII's accounts in the U.K. are held with HSBC Holdings PLC
and facilitate the receipt and disbursement of funds between
BRACII and its non-debtor subsidiaries and franchisees
throughout the world. BRACII's accounts in Switzerland are held
by UBS AG. The main Swiss account is being used to process
receipts and disbursements from BRACII's vehicle rental
operations in Switzerland, while the other Swiss account is used
to facilitate Swiss payroll disbursements.
Thus, the Debtors seek the Court's authority to continue using
the Amended Cash Management System.
In light of the estate's ongoing obligations as needed to comply
with the terms of the Sale Order, as well as the preservation
and enhancement of the Debtors' values as going concerns for its
retained operations, Mr. Morton believes that the Debtors' goals
for the Chapter 11 process simply cannot be achieved if their
cash management procedures are substantially disrupted.
Therefore, it is essential that the Debtors be permitted to
continue to consolidate the management of their cash in the
amounts necessary to continue the operation of their businesses
and in accordance with their existing cash management
procedures.
Mr. Morton explains that the Amended Cash Management System was
created and implemented by the Debtors' management in the
exercise of their business judgment and in compliance with the
Sale Order. In addition, it is similar to those commonly
employed by corporate enterprises comparable to the Debtors in
size and complexity.
If the Debtors were forced to change their cash management
system, Mr. Morton is concerned that it would cause needless
disruption to the Debtors' business and ongoing Chapter 11
process. In addition, the transition would cause the Debtors to
incur substantial costs and deplete the estate's assets without
providing any return benefit.
The Debtors also renew their request that no bank that is
participating in the Cash Management System that honors a
prepetition check or other item drawn on any account that is the
subject of this motion will be deemed to be liable to the
Debtors or to their estates on account of the prepetition check
or other item being honored postpetition under any of these
circumstances:
-- at the Debtors' direction;
-- in a good faith belief that the Court has authorized the
prepetition check or item to be honored; or
-- as a result of an innocent mistake made despite
implementation of reasonable item handling procedures.
The Debtors believe that the flexibility accorded to the Cash
Management Banks is necessary to induce the Cash Management
Banks to continue providing cash management services without
additional credit exposure. The Debtors additionally request
that the Cash Management Bank with respect to the New Accounts,
Harris Bank, be entitled to administrative priority status
pursuant to Sections 503(b)(1) and 507(a)(1) of the Bankruptcy
Code for any claims arising from its role as a Cash Management
Bank for the Debtors, including any claims arising from
overdrafts. (Budget Group Bankruptcy News, Issue No. 15;
Bankruptcy Creditors' Service, Inc., 609/392-0900)
DebtTraders says that Budget Group Inc.'s 9.125% bonds due 2006
(BDGP06USR1) are trading at about 23 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=BDGP06USR1
for real-time bond pricing.
BURLINGTON IND.: Inks Pact to Sell Assets to Berkshire Hathaway
---------------------------------------------------------------
Burlington Industries, Inc., (OTC Bulletin Board: BRLG) and
Berkshire Hathaway, Inc., (NYSE: BRK.A BRK.B) have executed a
definitive agreement for Berkshire Hathaway to acquire
Burlington Industries. The amount payable in the transaction to
creditors of Burlington, which began Chapter 11 reorganization
proceedings in 2001, is estimated to be $579 million, subject to
adjustments. Following emergence from Chapter 11, Burlington
would operate as a wholly owned subsidiary of Berkshire
Hathaway.
The details of the transaction are set forth in papers being
filed with the Court and with the Securities and Exchange
Commission. Under the proposed plan, Burlington's secured
creditors would be paid in full and its pre- petition unsecured
creditors would receive cash and certain other assets estimated
to be 34-35% of their claims. All shares of Burlington's Common
Stock would be canceled with no payment. Burlington would emerge
with no debt, other than ordinary course liabilities and certain
pre-petition obligations, having repaid the majority of the $1.1
billion of liabilities it had prior to its bankruptcy filing,
and eliminating the balance through the bankruptcy process.
"This is a very positive outcome for the company, our employees
and our creditors," said George W. Henderson, III, Chairman and
CEO of Burlington. "Over the last year our efforts have
increased the value of our company and allowed us to achieve a
significant level of return for our creditors despite
extraordinarily challenging conditions in our industry and the
capital markets.
"In several recent cases, other companies have emerged from
bankruptcy with excessive debt only to be faced with renewed
problems. The opportunity to be totally debt free and having
made considerable progress in our globalization efforts puts us
in a unique position to take full advantage of our capabilities
and compete successfully in a rapidly changing textile
business."
Warren E. Buffett, Chairman of Berkshire Hathaway commented
further, "Only the very strong will survive in the textile
industry -- strong in management, strong in worker skills and
strong in financial strength. Burlington brings the first two
resources to a successful reorganization; Berkshire brings the
latter. Burlington will go forth as a company with no debt,
talented and dedicated management, and a workforce second to
none. It will be a company designed for success."
Henderson continued, "We are excited to become a part of the
Berkshire Hathaway family of companies. Berkshire is a company
of great integrity and long-term focus, and we believe its solid
foundation provides us the right environment in which to operate
and grow as we implement a new and challenging business model."
Burlington will seek Court approval of procedures whereby higher
and better offers to purchase Burlington may be considered and
authorizing the payment to Berkshire of a termination fee in
certain circumstances. Burlington pointed out that the Berkshire
offer is for cash and is not dependent on obtaining outside
financing. The closing of the transaction is subject to various
conditions, including the completion of the alternative offer
process and pre-merger notification requirements of U.S. law.
In reaching its decision to enter into the Berkshire Agreement,
Burlington's Board considered a number of alternatives,
including a proposal from WL Ross & Co, LLC for a stand alone
reorganization. This proposal was contingent upon obtaining new
debt, and would pay only secured claims in cash and then offer
the unsecured creditors new common stock. Such proposal may be
considered again by the Company in connection with its ultimate
determination of the best and highest offer for the Company
under the bidding procedures to be established by the Bankruptcy
Court.
Burlington and Berkshire currently expect the closing to occur
toward the end of the June quarter of FY 2003.
With operations in the United States, Mexico and India and a
global manufacturing and product development network based in
Hong Kong, Burlington Industries is one of the world's most
diversified marketers and manufacturers of softgoods for apparel
and interior furnishings.
Berkshire Hathaway is a holding company owning subsidiaries
engaged in a number of diverse business activities. The most
important of these is the property and casualty insurance
business conducted on both a direct and reinsurance basis
through a number of subsidiaries.
CANNONDALE: Court Sets Final DIP Financing Hearing for Feb. 25
--------------------------------------------------------------
Cannondale Corporation obtained interim authority from the U.S.
Bankruptcy Court for the District of Connecticut to obtain
postpetition financing to finance its working capital needs
while under bankruptcy protection.
Pending a final hearing on February 25, 2003, the Debtor has
access to DIP Financing -- up to $4,955,350 on an interim basis
-- to pay rent and salaries, purchase supplies and for other
working capital needs and in order to help continue operations
uninterrupted. The Financing was provided by Pegasus Partners
II LP and CIT Group/Business Credit, Inc., its prepetition
principal secured lenders.
Absent financing for its continued business operations, the
Debtor's continuing operations may be adversely effected.
The Debtor relates that the Financing Facility will address the
Debtor's important liquidity needs to aid and enhance it in
preserving and maintaining its asset and market position and its
going concern value. If the Debtor is prevented or delayed in
providing to its customers and its employees the same services
as they had offered before the Petition Date, the Debtor's
business will be impaired at a time when employee, customer
loyalty and patronage is extremely critical.
The Debtor discloses that its business has recently been
effected by a number of business operating and general economic
factors which have reduced some of the income and cash flow
which the Debtor otherwise use to pay its daily operating
expenditures -- the very reason why the Debtor needs the
financing now.
Currently, the Debtor has been unable to obtain funding on any
other basis more beneficial to the estate. The Debtor notes that
without sufficient assets to provide as collateral, the Debtor's
ability to obtain financing from any conventional source at this
time would be unlikely.
The interim arrangement provides for adequate protection in the
nature of first priority security interests and liens, superior
to all other creditors, in and upon all of the existing and
future assets and property of the Debtor and this estate
pursuant to Section 364(c) and 364(d) of the Bankruptcy Code.
Because the Debtor has unsuccessfully attempted to obtain
unsecured credit allowable under Section 503(b)(1) as
administrative expense in an amount sufficient to meet its
working capital needs from any other source, the Debtor believes
that a new borrowing facility on the terms acceptable to the
Debtor are permissible within the Bankruptcy Code.
The Debtor adds that it believes that authorizing it to enter
into a postpetition facility is in the best interest of its
estate and creditors. Accordingly, the Debtor requests the Court
to allow interim approval of the postpetition facility and
permit the Debtor to incur loans in an amount sufficient to meet
the Debtor's interim needs pending the final hearing on this
motion. The DIP Financing Agreement however is not available
online
Cannondale Corp., a leading manufacturer and distributor of high
performance bicycles, all-terrain vehicles, motorcycles and
bicycling and motorsports accessories and equipment, filed for
chapter 11 protection on January 29, 2003 in the U.S. Bankruptcy
Court for the District of Connecticut (Bankr. Case No.
03-50117). James Berman, Esq., at Zeisler and Zeisler
represents the Debtors in their restructuring efforts. When the
Company filed for protection from its creditors, it listed
$114,813,725 in total assets and $105,245,084 in total debts.
CEDAR BRAKES I & II: S&P Cuts Senior Secured Bond Ratings to B
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on Cedar
Brakes I LLC's $310.6 million senior secured bonds and Cedar
Brakes II LLC's $431.4 million senior secured bonds to 'B' from
'BB-'. At the same time, Standard & Poor's removed both ratings
from CreditWatch. The outlook is negative.
The rating actions follow the downgrade of El Paso Corp. to 'B+'
from 'BB', and related downgrade of its senior unsecured rating
to 'B' from 'BB-'. Both Cedar Brakes I and II obtain electricity
from El Paso Merchant Energy L.P. under power purchase
agreements, which is then sold to Public Service Electric & Gas
Co. (PSE&G; BBB/Stable/A-2). The obligations of EPM under the
PPAs are guaranteed by El Paso Corp. The ratings on Cedar Brakes
I and II are therefore constrained by the minimum of the senior
unsecured rating of either El Paso Corp., as the mirror PPA
guarantor (senior unsecured rating of 'B'), or PSE&G as the
offtaker (implied senior unsecured rating of 'BBB-'). The rating
actions on Cedar Brakes I and II are solely a function of the El
Paso rating action. There have been no other events that have
changed our opinion on the structure, which has operated as
designed in the transaction documents.
El Paso formed Cedar Brakes I and II to amend and restate, as
well as monetize, PPAs originally between PSE&G and certain
project companies. Cedar Brakes I and II obtained the right,
title, and interest in long-term PPAs from those companies and
sell electric energy and provide electric capacity to PSE&G.
Cedar Brakes I and II also entered into other related
agreements, an indenture, and related financing documents, and
undertook the transactions contemplated thereunder; engaged in
other activities that are related to or incidental to the above
items; and issued the senior secured bonds.
The negative outlook on Cedar Brakes I and II reflects that of
El Paso Corp. as the mirror PPA guarantor. El Paso's negative
outlook reflects significant hurdles the company has regarding
regaining access to capital markets, halting the continued
decline in cash flow, and resolving the FERC matter in a manner
that is credit neutral to El Paso. Successful execution in these
matters could ultimately lead to ratings stability and upward
credit momentum.
CELLPOINT INC: Hires Michael Mathiesen as New President & CEO
-------------------------------------------------------------
CellPoint Inc. (OTC: CLPT), a global provider of mobile location
software technology and platforms, announced that Michael
Mathiesen is joining the company as the new President and CEO.
Mr. Mathiesen will replace Carl Johan Tornell as President and
will assume Stephen Childs' role as CEO. Mr. Childs will remain
Chairman of the Board.
Michael Mathiesen has more than 20 years of international
experience, having held senior positions in IT and
Telecommunications companies. Mr. Mathiesen will oversee daily
operations and will be located at CellPoint's new office in
Stockholm.
CellPoint Inc., has already established a new subsidiary in
Sweden to facilitate product development and support. All assets
of CellPoint's former Swedish subsidiary, CellPoint AB, have
been acquired by CellPoint Inc. These assets will be deployed
through the new subsidiary. As part of the restart of the
Swedish subsidiary, CellPoint Inc., is issuing new shares to
secure funds for continued operations. The company will provide
more detailed information pertaining to the financing on or
before the 17th of February.
The first phase of the restart involves the hiring of around 15
to 20 employees. CellPoint believes that this core group will be
able to support its customers and the initial obligations of
existing agreements. CellPoint will hire additional employees as
needed to support increased demand.
Additionally, Bengt Nordstrom is leaving the Board of Directors.
CellPoint's current directors are Don Lilly, Carl Johan Tornell
and Stephen Childs. The company has identified additional
directors which will be appointed during the next few months.
For information, please contact:
D. Shawn Rogers
VP of Communications
US Contact 312-593-6870
investinfo@cellpoint.com
CellPoint Inc., (OTC: CLPT) and (Aktietorget: CLPT) is a leading
global provider of location determination technology,
carrier-class middleware and applications enabling mobile
network operators' rapid deployment of revenue generating
location-based services for consumer and business users and to
address mobile E911/E112 security requirements.
CellPoint's two core products, Mobile Location System and
Mobile Location Broker, provide an open standard platform
adapted for multi-vendor networks with secure integration of
third-party applications and content. CellPoint's location
platform has a seamless migration path from GSM/GPRS to 3G,
supports 500,000 location requests per hour and can easily be
scaled-up to handle increased traffic throughput.
CellPoint's early entry and experience with European mobile
operators has allowed the development of products and features
that address key requirements such as active and idle mode
positioning, international roaming, multiple location
determination technologies and consumer privacy.
CellPoint is a global company headquartered in Kista, Sweden.
For more information, please visit http://www.cellpoint.com
Working Capital Deficit
CellPoint's June 30, 2002 balance sheets show total current
liabilities exceeded its total current assets by close to $12
million.
Going Concern Doubts
In its SEC Form 10-K for the period ended June 30, 2002, the
Company reported that it will require additional capital to
implement its business strategies, including cash for (i)
payment of operating expenses such as salaries for employees,
and (ii) further implementation of those business strategies.
That additional capital, the Company said, may be raised through
additional public or private financing, as well as borrowings
and other resources . . . and if unable to access the
capital markets or obtain acceptable financing, its future
results of operations and financial condition could be
materially and adversely affected. As a result of the
uncertainty of the Company's ability to continue as a going
concern, its auditors have included a modification in their
opinion on the Company's June 30, 2002 consolidated financial
statements expressing substantial doubt about its ability to
continue as a going concern for the June 30, 2002 consolidated
financial statements.
COMDISCO INC: Redeems $50 Mil. of 11% Subordinated Secured Notes
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Comdisco Holding Company, Inc., (OTC:CDCO) said that, as
previously announced on January 24, 2003, the company has
completed a partial redemption of $50 million principal amount
of its 11% Subordinated Secured Notes due 2005. The total
outstanding principal amount of the notes after this redemption
is $235 million.
The $50 million of Subordinated Secured Notes were redeemed at a
price equal to 100% of their principal amount plus accrued and
unpaid interest to the redemption date. Comdisco previously
redeemed $65 million, $200 million and $100 million principal
amounts of the 11% Subordinated Secured Notes on November 14,
2002, December 23, 2002, and January 9, 2003, respectively.
The purpose of reorganized Comdisco is to sell, collect or
otherwise reduce to money the remaining assets of the
corporation in an orderly manner. Rosemont, IL-based Comdisco --
http://www.comdisco.com-- provided equipment leasing and
technology services to help its customers maximize technology
functionality and predictability, while freeing them from the
complexity of managing their technology. Through its former
Ventures division, Comdisco provided equipment leasing and other
financing and services to venture capital backed companies.
COMDISCO INC: Angelo Gordon & Co. Discloses 6.33% Equity Stake
--------------------------------------------------------------
Angelo, Gordon & Co., LP amends its Schedule 13G Statement,
informing the Securities and Exchange Commission that it, John
M. Angelo and Michael L. Gordon, beneficially hold a 6.33%
equity stake in Reorganized Comdisco.
The Shares are held for the accounts of Angelo, Gordon and 16
private investment funds for which Angelo, Gordon acts as the
general partner and investment adviser.
As of December 31, 2002:
(i) 266 Shares are held for the account of Angelo, Gordon,
and
(ii) 265,800 Shares are held for the account of 16 private
investment funds for which Angelo, Gordon acts a general
manager and/or investment adviser.
The partners of Angelo, Gordon have the right to participate in
the receipt of dividends from, or proceeds from the sale of, the
securities held for the account of Angelo, Gordon in accordance
with their partnership interests in Angelo, Gordon. (Comdisco
Bankruptcy News, Issue No. 43; Bankruptcy Creditors' Service,
Inc., 609/392-0900)
CONSECO FINANCE: Court Okays Dorsey & Whitney as Special Counsel
----------------------------------------------------------------
Conseco Finance Corporation and its debtor-affiliates sought and
obtained the Court's permission to employ Dorsey & Whitney as
special corporate/securitization and conflicts counsel.
Dorsey will not represent the CFC Debtors in the general
Bankruptcy Case. Instead, Dorsey will represent the CFC Debtors
regarding corporate, securitization and other matters. Dorsey
will provide assistance with securitization transactions to fund
the CFC Debtors' business of making loans, as well as general
corporate matters.
Charles H. Cremens, CFC President and CEO, tells Judge Doyle
that Dorsey is qualified to practice in this Court and to advise
the Debtors in these specialized areas. The engagement is
essential to a successful reorganization. Mr. Cremens also
notes that Dorsey has represented the CFC Debtors in a variety
of corporate matters and financing transactions prepetition,
including securitization transactions and litigations matters.
The Debtors will compensate Dorsey on an hourly basis and
reimburse the firm of actual and necessary expenses incurrred.
The primary lawyers who will be responsible for this engagement
and their corresponding hourly rates are:
Professional Hourly Rate
------------ -----------
B. Shnider $545
M. Reeslund 475
C. Sawyer 450
T. Cadwell 375
S. Nyquist 355
M. Clark 270
Charles F. Sawyer, Esq., a partner at Dorsey's Minneapolis,
Minnesota office, informs the Court that the firm has conducted
a thorough review of its client database in an attempt to locate
potential adverse interests. Mr. Sawyer asserts that his firm
does not hold or represent any adverse interest to the CFC
Debtors or to their estates. Dorsey is a "disinterested person"
within the meaning of Section 101(14) of the Bankruptcy Code.
However, Mr. Sawyer reports that Dorsey has represented these
unsecured creditors of the CFC Debtors in matters unrelated to
these Chapter 11 cases: American Express; Briggs and Morgan;
Deutsche Financial; U.S. Bank National Association, success by
merger to U.S. Bank Trust National Association; Credit Suisse
First Boston Corp; Select Comfort Corporation; Comdisco, Inc.;
Hewlett-Packard; De Lage Landen Financial Services, Inc.; and
Menards. (Conseco Bankruptcy News, Issue No. 6; Bankruptcy
Creditors' Service, Inc., 609/392-0900)
CONSECO: Court Okays Baker Botts as Special Litigation Counsel
--------------------------------------------------------------
Conseco Inc., and its debtor-affiliates obtained permission from
the Court to employ Baker Botts as special litigation counsel
for matters related to a non-public Securities and Exchange
Commission investigation.
Baker Botts will be paid based on an hourly scale, plus
reimbursement of actual, necessary expenses. The primary
lawyers who will be responsible for this engagement and their
hourly rates are as follows:
James R. Doty $650
James E. Rocap, III $500
Stacy Paxson $300
Other Associates $145-$315
Legal Assistants $70-$125
Baker Botts performed its standard conflict review procedure to
determine if there were any adverse interests. Baker Botts is
to represent the Debtors in SEC matters only and no person at
the firm has any interest in the SEC. Baker Botts determined
that no conflicts exist. (Conseco Bankruptcy News, Issue No. 6;
Bankruptcy Creditors' Service, Inc., 609/392-0900)
CYBEX INT'L: Will Hold Q4 Earnings Conference Call Tomorrow
-----------------------------------------------------------
Cybex International, Inc. (AMEX:CYB), a leading exercise
equipment manufacturer, will discuss its fourth quarter/year-end
results in a conference call on Thursday, February 13 at 2:00
p.m. EST.
Those who wish to participate in the conference call may
telephone (888) 335-6674 approximately 15 minutes before the
2:00 p.m. EST starting time. A digital replay of the call will
be available by telephone for 24 hours following the completion
of the live call, at (877) 519-4471 toll free in the United
States or (973) 341-3080 for international callers, PIN
#3747558.
Cybex International, Inc., is a leading manufacturer of premium
exercise equipment for consumer and commercial use. Cybex and
the Cybex Institute, a training and research facility, are
dedicated to improving exercise performance based on an
understanding of the diverse goals and needs of individuals of
varying physical capabilities. Cybex designs and engineers each
of its products and programs to reflect the natural movement of
the human body, allowing for variation in training and assisting
each unique user - from the professional athlete to the
rehabilitation patient - to improve their daily human
performance. For more information on Cybex and its product line,
please visit the Company's Web site at http://www.eCybex.com
As reported in Troubled Company Reporter's November 1, 2002
edition, Cybex International retained the investment banking
firm of Legg Mason Wood Walker, Incorporated to advise and
assist with alternatives associated with the refinancing of its
debt facility. In addition, the Company reported that David
Fleming has resigned as a member of the Company's Board of
Directors.
At September 28, 2002, the Company recorded a working capital
deficit of about $9.3 million.
DECORATIVE SURFACES: Court Fixes Mar. 15 Admin. Claims Bar Date
---------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware set an
Administrative Claims Bar Date for creditors of Decorative
Surfaces International, Inc., asserting administrative claims
against the Debtor's estate, to present requests for payment of
those claims. The deadline is March 15, 2003.
All creditors who hold claims for secured, unsecured priority
and general unsecured claims shall file their proofs of claim on
or before 4:00 p.m. of the Administrative Claims Bar Date or be
forever barred from asserting that claim. Proofs of claim for
claims arising from the rejection of an executory contract or
unexpired lease is also fixed to be filed at the later of the
Administrative Claims Bar Date or 30 days from date of the entry
of the Order that approves the rejection of such contract or
lease.
Claimholders exempted from the Administrative Claims Bar Date
are:
(a) claims properly filed at proof of claim or request for
payment against the Debtor with the Clerk of the
Bankruptcy Court for the District of Delaware;
(b) claims listed in the Debtor's Schedule of Liabilities
filed with this Court in an amount or manner with which
such person or entity agrees, and which claim is not
listed in such Schedules of Liabilities as disputed,
contingent, or unliquidated;
(c) claims held by professionals retained by the Debtor or
the Committee that are required to file a applications
for payment of compensation and reimbursement of
expenses, or any member of the Committee that may seek
reimbursement of expenses; and
(d) claims seeking compensation or reimbursement from the
Creditors Trust for services provided to such trust, or
as trustee for, or as a member of.
Decorative Surfaces International, Inc. manufactures wall
coverings, decorative design components for floor tiled and
other laminates. The Company filed for chapter 11 protection on
March 19, 2002 (Bankr. Del. Case No. 02-10841). When the Company
filed for protection from its creditors, it listed estimated
assets of $10 million to $50 million and estimated debts of $50
million to $100 million.
DOW CORNING: Appoints Stephanie Burns as New President & COO
------------------------------------------------------------
The Dow Corning Board of Directors elected Stephanie Burns, 48,
president and Chief Operating Officer of the company, effective
immediately. Her current role as executive vice president will
not be filled. Gary Anderson, 57, will remain chairman and CEO,
and the Office of the CEO will continue.
"The board and I are extremely pleased to have Stephanie as our
new president," said Anderson. "Stephanie brings a wealth of
talents, experiences and leadership to the role. Over the past
two years, Dow Corning has transformed itself from a company
focused on products to a solutions company that is organized
around the needs of our customers around the world. Stephanie
has been actively involved in every aspect of leading Dow
Corning through that change.
"It's also great to have a Ph.D. silicon chemist back at the
helm. I know that Stephanie's enthusiasm and vigor will help
drive the company to new heights of success for the benefit of
all employees, shareholders and customers," Anderson concluded.
Stephanie Burns joined Dow Corning in 1983 to work in Central
Research. She was named product development manager for the
Electronics Industry in 1987, and Science and Technology manager
for the Healthcare Industry in 1990. From 1994 to 1997, she
served on the Chapter 11 management team and as director of
Women's Health Issues. In 1997, Stephanie moved to Brussels to
become the European Area S&T director. In 1999, she was named
Life Sciences Industry director for Europe and also served as
Electronics Industry director in Europe. Stephanie returned to
the U.S. in January 2001 to assume the position of executive
vice president and member of the Office of the CEO. She was
elected to the Dow Corning Board of Directors in December 2000.
Stephanie earned a Ph.D. in organic chemistry, with an
organosilicon specialty, from Iowa State University and
completed post-doctorate studies at the University of
Organometallic Chemistry Languedoc-Rousillon in France. She is a
member of the American Chemical Council and the American
Chemistry Society.
Dow Corning -- http://www.dowcorning.com-- develops,
manufactures and markets diverse silicon-based products and
services, and currently offers more than 7,000 products to more
than 25,000 customers around the world. Dow Corning is a global
leader in silicon-based materials with shares equally owned by
The Dow Chemical Company (NYSE: DOW) and Corning Inc. (NYSE:
GLW). More than half of Dow Corning's $2.7 billion in annual
sales are outside the United States.
Dow Corning filed for chapter 11 protection in 1995. Dow
Corning's Amended Joint Plan of Reorganization dated February 4,
1999 (as modified on July 28, 1999 and supplemented on July 30,
1999) was confirmed by the U.S. Bankruptcy Court for the Eastern
District of Michigan on Nov. 30, 1999. Four remaining appeals
(brought by the Department of Defense, the Health Care Financing
Administration, the Indian Health Service and the Department of
Veterans Affairs) from the Confirmation Order await resolution
by Judge Hood in the District Court and stand in the way of the
Plan taking effect. Dow Corning's commercial creditors (whose
claims accrue 6.28% interest day-by-day) await the Effective
Date of that Plan.
DUN & BRADSTREET: Will Not Raise Offer to Acquire Hoover's
----------------------------------------------------------
Dun & Bradstreet (NYSE: DNB), the leading provider of global
business information and technology solutions, will not raise
its $7.00 per share offer to acquire Hoover's, despite a higher
offer received by Hoover's last week.
"We made a commitment to our shareholders to create value during
our transformation into a growth company with an important
presence on the Web," said Allan Z. Loren, chairman and chief
executive officer of D&B. "We believe Hoover's is a natural fit
for D&B. However, we conducted our due diligence in a
disciplined manner over many months, and we concluded that to
pay more than our most recent offer would not be in the best
interests of our shareholders. As a result, we decided we will
not raise our offer to acquire Hoover's."
D&B said that it will seek to complete the transaction under the
terms of the merger agreement. If the transaction is not
completed, D&B will make a further announcement concerning its
2003 guidance.
D&B (NYSE: DNB) provides the information, tools and expertise to
help customers Decide with Confidence. D&B enables customers
quick access to objective, global information whenever and
wherever they need it. Customers use D&B Risk Management
Solutions to manage credit exposure, D&B Sales & Marketing
Solutions to find profitable customers and D&B Supply Management
Solutions to manage suppliers efficiently. D&B's E-Business
Solutions are also used to provide Web-based access to trusted
business information for current customers as well as new small
business and other non-traditional customers. Over 90 percent of
the Business Week Global 1000 rely on D&B as a trusted partner
to make confident business decisions. For more information,
please visit http://www.dnb.com
As previously reported, The Dun & Bradstreet Corporation's
September 30, 2002 balance sheet shows a working capital deficit
of about $145 million, and a total shareholders' equity deficit
of about $34 million.
EAST COAST POWER: S&P Ratchets Sr. Sec. Note Rating Down to BB+
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on East
Coast Power LLC's senior secured notes to 'BB+' from 'BBB-'
solely due to East Coast Power's rating linkage to El Paso Corp.
(B+/Negative/--). The outlook is negative.
"The rating action is directly attributable to the downgrade of
El Paso Corp.'s ratings. There have been no other events that
would have caused a rating action on this subsidiary," said
credit analyst Scott Taylor.
In most circumstances Standard & Poor's will not rate the debt
of a wholly owned subsidiary higher than the rating of the
parent. Exceptions can be made, and were in this case, on the
basis of the cumulative value provided by enhancements such as
structural protections, covenants, and an independent director,
in conjunction with the stand-alone credit quality of the
entity, which supports such elevation. These provisions serve to
make East Coast Power LLC bankruptcy remote from El Paso Corp.,
which has weaker credit quality. While Standard & Poor's views
these provisions as supportive in that they reduce the risk of a
subsidiary being filed into bankruptcy in the event of a parent
bankruptcy, the provisions are not viewed by Standard & Poor's
as 100% preventative of such a scenario. Therefore, Standard &
Poor's limits the rating differential provided by such
structural enhancements to three notches. On that basis, East
Coast Power LLC's corporate credit ratings cannot be higher than
'BB+'.
Of note is the fact that El Paso has publicly disclosed that the
Linden facility is for sale, and that a sale is expected in the
second quarter of this year. As details emerge on such a sale,
Standard & Poor's will review the rating and outlook of East
Coast Power.
Standard & Poor's expects that East Coast Power will continue to
be successful in managing the projects. However, the negative
outlook reflects that of El Paso Corp. El Paso's outlook
reflects significant hurdles the company has regarding regaining
access to capital markets, halting the continued decline in cash
flow, and resolving the FERC matter in a manner that is credit
neutral to El Paso. Successful execution in these matters could
ultimately lead to ratings stability and upward credit momentum.
EL PASO: S&P Keeps Watch on Ratings After Partner's Downgrade
-------------------------------------------------------------
Standard & Poor's Ratings Services said its 'BB+' corporate
credit rating on oil and natural gas services company El Paso
Energy Partners L.P., will remain on CreditWatch with negative
implications following the recent downgrade of the corporate
credit rating of its general partner, El Paso Corp., to
'B+'.
Houston, Texas-based EPN has about $1.8 billion in outstanding
debt.
"Standard & Poor's continues to evaluate the relationship
between EPN and its general partner, and until that review is
completed, the CreditWatch listing for EPN will remain in
effect," said Standard & Poor's credit analyst Todd Shipman.
"EPN management has indicated a willingness to take steps to
insulate itself from El Paso Corp., and in fact has already
acted to strengthen its corporate governance," he continued.
The deterioration of El Paso Corp.'s credit quality pressures
EPN's rating irrespective of the partnership's stand-alone
credit quality. In resolving the CreditWatch designation, which
is expected to occur in the very near term, Standard & Poor's
will assess the degree to which operational, legal, and
strategic considerations will affect any ratings separation
between the two entities.
EMERGING VISION: Sets Terms for Shareholder Rights Offering
-----------------------------------------------------------
Emerging Vision, Inc., (OTCBB: ISEE.OB) has filed an amended
registration statement with the Securities and Exchange
Commission in connection with its previously announced rights
offering to its shareholders.
The rights offering will consist of 50,000,000 units, with each
unit consisting of one share of the Company's common stock and a
warrant, having a term of twelve months, to purchase one
additional share of common stock at an exercise price equal to
$0.05, unless the average of the last reported sales price of
its common stock, as quoted on the OTC Bulletin Board, during
the fifteen trading days immediately preceding, and including,
April 7, 2003 is $0.125 or more and the average number of shares
traded during each of those fifteen trading days is 50,000 or
more, in which case the exercise price will be equal to $0.06,
or if the same volume conditions are met but the average of the
last reported sales prices is $0.195 or more, in which case the
exercise price will be equal to $0.07.
Each shareholder will be granted 1.67 non-transferable rights
for every share of common stock owned as of February 25, 2003,
the record date. Each right will be exercisable for one unit at
a price of $0.04, the proceeds of which will be used to repay
the amounts outstanding under the Company's existing credit
facility and term loan, to fund its plan to close non-profitable
stores and for general corporate and working capital purposes.
The rights offering will commence on or about February 26, 2003
and continue until 5:00 p.m. on April 14, 2003.
In addition, an oversubscription privilege has been included,
allowing shareholders to subscribe for additional units not
subscribed for by other shareholders pro rata based on the
number of units purchased under the basic subscription
privilege. No fractional rights will be issued, but the Company
will round the number of rights its shareholders receive down to
the nearest whole number.
A registration statement relating to these securities has been
filed with the Securities and Exchange Commission but has not
yet become effective. These securities may not be sold, nor may
offers to buy be accepted prior to the time the registration
statement becomes effective, and will be made only by means of a
prospectus.
Emerging Vision, Inc., operates one of the largest chains of
retail optical stores and one of the largest franchised optical
chains in the United States, with approximately 186 franchised
and Company-owned stores located in 23 states, the District of
Columbia, Ontario, Canada and the U.S. Virgin Islands,
principally operating under the names "Sterling Optical" and
"Site for Sore Eyes."
Liquidity Problems
As of September 30, 2002 (exclusive of net liabilities of
discontinued operations), Emerging Vision Inc., had negative
working capital of $4,681,000 and cash on hand of $601,000.
During the nine months ended September 30, 2002, the Company
used approximately $1,856,000 of cash in its operating
activities. This usage was in line with management's plans and
was mainly a result of approximately $680,000 of costs related
to the Company's store closure plan, a net decrease of $593,000
in accounts payable and accrued liabilities that existed as of
December 31, 2001, and $271,000 related to the prepayment of
certain other business expenses, offset, in part, by a net
decrease of $346,000 in franchise and other receivables.
Management anticipates that it will continue to incur
significant costs in order to continue to close certain of its
non-profitable Company-owned stores, all in its effort to
eliminate future cash flow losses currently generated by such
stores.
Based on its current financial position, the Company may not
have sufficient liquidity available to continue in operation for
the next 12 months. However, the Company plans to continue to
attempt to improve its cash flows during the remainder of 2002,
and into 2003, by improving store profitability through
increased monitoring of store-by-store operations, closing non-
profitable Company-owned stores, implementing reductions of
administrative overhead expenses where necessary and feasible,
actively supporting development programs for franchisees, and
adding new franchised stores to the system. Management believes
that with the successful execution of the aforementioned plans
to attempt to improve cash flows, its existing cash, the
collection of outstanding receivables, the availability under
its existing credit facility, and the successful completion of
its shareholder rights offering, there will be sufficient
liquidity available for the Company to continue in operation for
the next 12 months. However, there can be no assurance that the
Company will be able to successfully execute the aforementioned
plans, or that it will be successful in completing its rights
offering.
ENCOMPASS SERVICES: Oakleaf Interest Sale to James Barnes Okayed
----------------------------------------------------------------
On December 13, 2002, Debtors Wayzata Inc., and Encompass
Management Co., entered into an option agreement granting James
R. Barnes or his permitted assignee the option to acquire their
Class A Interest in Oakleaf Waste Management LLC for $2,000,000
in cash, payable at the Closing. The Debtors own the Class A
Interest in Oakleaf in exchange for a $2,500,000 investment.
They want to divest the Class A Interest to raise funds for
their estates and to streamline their operations.
Mr. Barnes owns at least 95% of the membership interests in
Oakleaf Principals, LLC, the owner of a Class B Interest in
Oakleaf. Oakleaf's operation is governed by a Second Amended
and Restated Operating Agreement dated October 3, 2002.
Accordingly, Encompass Services Corporation and its debtor-
affiliates sought and obtained the Court's authority to
consummate the sale and transfer of the Oakleaf Class A Interest
to Mr. Barnes.
Pursuant to the Court Order, Mr. Barnes will not be deemed a
successor of or to the Debtors for any lien, claim, encumbrance
or other interest against or in them or the Class A Interest of
any kind or nature. In addition, the Order provides that:
(a) Except as expressly permitted or specifically provided for
in the parties' Option Agreement or in these provisions,
the sale, transfer, assignment and delivery of the Class A
Interest will not be subject to any lien, claim,
encumbrance or other interest. These will remain with,
and continue to be obligations of, the Debtors;
(b) All persons holding liens, claims, encumbrances or other
interests against the Debtors or the Class A Interest will
be, forever barred from asserting or pursuing these
against Mr. Barnes, his property, successors and assigns,
or the Class A Interest;
(c) At the Closing, no holder of any lien, claim, encumbrance
or other interest in the Debtors will interfere with Mr.
Barnes's title to or use and enjoyment of the Class A
Interest based on or related to the lien, claim,
encumbrance or other interest or any actions that the
Debtors may take in their Chapter 11 case;
(d) In the event of a reversal or modification on appeal of
these provisions, Mr. Barnes is entitled to the
protections afforded by Section 363(m) of the Bankruptcy
Code;
(e) Every federal, state and local government agency or
department are authorized and directed to accept any and
all documents and instruments necessary and appropriate to
consummate all transactions contemplated by these
provisions and in reasonable compliance with the
applicable laws and regulations;
(f) The Option Agreement, any related agreements, documents or
other instruments may be modified, amended or supplemented
by the parties in accordance with the terms without
further Court order, provided that the modifications,
amendment or supplement is not material; and
(g) The sale of the Class A Interest to Mr. Barnes and the
transaction contemplated by the Option Agreement will be
exempt from any and all transfer, stamp, value-added,
recording and similar taxes, and any transfer or recording
fees or other similar costs incurred or assessed by any
federal, state, local or foreign taxing authority in
connection with the sale. (Encompass Bankruptcy News,
Issue No. 6; Bankruptcy Creditors' Service, Inc., 609/392-
0900)
ENRON INC: Sells Recycling Business to Fiber Corp & All American
----------------------------------------------------------------
After having conducted and completed a public auction for the
sale of the Assets on January 21, 2003, Garden State, an Enron
Corporation debtor-affiliate, in consultation with the
Creditors' Committee, has determined that Fiber Corporation of
America and All American Recycling Corporation collectively
submitted the highest and best bid. Fiber Corp. will pay
$775,000 while All American will pay $325,000 for the Assets.
Accordingly, the Court grants the motion on these terms:
A. The sale of the Assets by Garden State to Fiber Corp. and
All American pursuant to an Asset Purchase Agreements dated
January 21, 2003 are approved pursuant to Section 363 of the
Bankruptcy Code.
A free copy of the All American Asset Purchase Agreement is
available at:
http://bankrupt.com/misc/AllAmericanAssetPurchaseAgreement.pdf
A free copy of the Fiber Corp. Asset Purchase Agreement is
available at:
http://bankrupt.com/misc/FiberCorpAssetPurchaseAgreement.pdf
B. Garden State and the Purchasers are authorized pursuant to
Sections 105 and 363 of the Bankruptcy Code to perform all
of their obligations in connection with the transactions
contemplated in the Agreements, and to execute other
documents and agreements, if any, and take other actions as
are required to consummate the transactions;
C. All proceeds received from the Purchasers in respect of the
transactions will be held by Garden State and will be neither
disbursed nor used until further Court order;
D. The assignment, sale and transfer of the Assets to the
Purchasers will be deemed exempt from state and local taxes
pursuant to Sections 1146(c) and 105(a) of the Bankruptcy
Code and no governmental authority may -- on account of this
exemption -- refuse to issue any permit, impose any
penalties, or discriminate in any way against the Purchasers
or any of their subsequent assignees, as applicable;
E. Garden State's assumption and assignment of the Port Carteret
Site Real Estate Lease to Fiber Corp. and the Paterson Site
Real Estate Lease to All American in connection with the
consummation of the transactions contemplated in this Order
and in accordance with Section 365 of the Bankruptcy Code is
approved; and
F. Fiber Corp. and All American both have provided the Lease
counterparties with adequate assurance of future performance
with respect to the Real Estate Leases. (Enron Bankruptcy
News, Issue No. 56; Bankruptcy Creditors' Service, Inc.,
609/392-0900)
DebtTraders reports that Enron Corp.'s 9.875% bonds due 2003
(ENRN03USR3) are trading at about 14 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=ENRN03USR3
for real-time bond pricing.
EOTT ENERGY: Court Approves Compromise with Big Warrior Corp.
-------------------------------------------------------------
Pursuant to Rule 9019 of the Federal Rules of Bankruptcy
Procedure, EOTT Energy Partners, L.P., and its debtor-affiliates
sought and obtained Court approval of their compromise with Big
Warrior Corporation.
Trey A. Monsour, Esq., at Haynes and Boone LLP, in Dallas,
Texas, recounts that on October 23, 2001, Enron Pipeline
Services Company awarded a contract to Big Warrior for the
construction of EOTT Pipeline's new 10-inch crude oil pipeline
that runs from Lumberton, Mississippi to Eucutta, Mississippi.
EPSC managed the Lumberton-Eucutta Pipeline for EOTT Corp.
pursuant to the Operation and Service Agreement dated October 1,
2000.
Under the Contract, Big Warrior would receive a $10,100,000 lump
sum payment for the Lumberton-Eucutta Pipeline construction. Of
the $10,100,000, Big Warrior has been paid $8,000,000. Due to
the Debtors' financial difficulties, Big Warrior is still owed
approximately $2,200,000 under the Contract -- an amount EOTT
does not dispute.
Mr. Monsour reports that Big Warrior substantially completed the
project. However, during the course of the construction, a
dispute arose between Big Warrior, EPSC, EOTT Pipeline and EOTT
Corp. Big Warrior claimed that, in addition to the undisputed
$2,200,000 owed under the Contract, it is owed $7,500,000 for
additional work beyond the terms of the Contract. EPSC, EOTT
Pipeline and EOTT Corp. denied that Big Warrior is entitled to
any payment other than that provided in the Contract.
Consequently, Big Warrior filed a construction lien in
accordance with the Mississippi Construction Lien and Lis
Pendens Statutes on June 6, 2002. Thereafter, on August 5,
2002, Big Warrior filed a lawsuit styled, "Big Warrior Corp. v.
Enron Transportation Services, Inc., EOTT Energy Corp., REM
Services, Inc., Enron Pipeline Services Company, et al" in the
Circuit Court of Jones County, Mississippi, and amended on
September 5, 2002. In the litigation, Big Warrior sought
payment of unanticipated additional costs that resulted from
adjustments to the project work schedule and EPSC's failure to
timely procure necessary rights of way and rights of ingress and
egress. Big Warrior also asserted actual and punitive damages
of up to $30,000,000. In December 2002, Big Warrior asked the
Court to lift the automatic stay to pursue the litigation.
To settle the motion and the Litigation, the Debtors decided to
enter into a Compromise Agreement with Big Warrior on these
terms:
(a) The Debtors will pay to Big Warrior $1,764,700 in cash;
(b) The Debtors will issue to Big Warrior a $2,700,000 note
secured by a second lien position on the Lumberton-Eucutta
Pipeline at 6% interest with a seven-year amortization and
a balloon payment at four years paid in quarterly
installments with the first installment occurring on
June 1, 2003;
(c) The amount of the Note represents a secured claim for
$2,700,000 in the Debtors' Chapter 11 bankruptcy
proceedings and the terms of this settlement will not be
modified by any eventual confirmed plan of reorganization;
(d) Big Warrior will provide to EOTT the "as built" drawing of
the Lumberton-Eucutta Pipeline;
(e) Big Warrior will release the Debtors and the other
parties, excluding REM Services, Inc. that are the
subject of the Litigation;
(f) Big Warrior reserves the right to negotiate payment of
any claims of subcontractors, vendors, or suppliers
relating to a claim of payment owed by Big Warrior for
goods and services rendered in connection with the
construction of the Lumberton-Eucutta Pipeline;
(g) Big Warrior will indemnify the Debtors if the Debtors
are required to pay any claims made by Big Warrior
Claimants that become allowed in these bankruptcy
proceedings. The indemnification will be satisfied at
Big Warrior's option by:
-- a direct payment from Big Warrior to the Big Warrior
Claimant; or
-- an offset on the Note.
The indemnification is not limited by the amount of the
Note;
(h) Big Warrior specifically does not indemnify the Debtors
for any claims by subcontractors, vendors, or suppliers
relating to a claim of payment for goods and services
rendered in connection with the construction of the
Lumberton-Eucutta Pipeline if the claimant contracted
Directly with the Debtors; and
(i) This Compromise survives the conversion or dismissal of
the Debtors' bankruptcy proceedings and will be binding
on and will inure to the benefit of the parties thereto
and their successors and assigns, including, without
limitation, any subsequent trustee that may be elected or
appointed in the Debtors' bankruptcy proceedings.
According to Mr. Monsour, the Compromise is warranted because:
(i) it represents the exchange of reasonable equivalent value
between the Debtors and Big Warrior, and in no way
unjustly enriches either party;
(ii) the settlement constitutes the contemporaneous exchange
of new value and legal, valid and effective transfers
between the Parties; and
(iii) without the Compromise, the Debtors would be faced with
substantial litigation costs defending the lien dispute.
The Litigation would be costly, time-consuming,
distracting to management and employees, and subject to
uncertain results. The Settlement eliminates these risks.
(EOTT Energy Bankruptcy News, Issue No. 10; Bankruptcy
Creditors' Service, Inc., 609/392-0900)
GALEY & LORD: Hires Hart Corp. to Market North Carolina Property
----------------------------------------------------------------
Galey & Lord, Inc., and its affiliated debtor entities ask for
authority from the U.S. Bankruptcy Court for the Southern
District of New York to hire Hart Corporation as their exclusive
sales agent to market and sell certain property located in
Erwin, North Carolina.
The Debtors relate that it previously employed Binswanger to
sell the 141.3-acre parcel of land and buildings located at
Highway 217 South in Erwin, North Carolina. The Binswanger
Agreement expired on December 21, 2002.
The Debtors continue to believe that the sale of the Property
would generate substantial value for their bankruptcy estates.
The Debtors do not have any experience or expertise performing
real estate services and procuring potential purchasers or
lessors, and therefore seek to retain Hart, nunc pro tunc to
January 27, 2003, to act as their exclusive sales agent to sell
or lease the Property.
Hart is a leading broker for the sale of major industrial
facilities in smaller cities throughout the United States. Hart
has expertise in the field, familiarity with the Debtors and the
Property, and extensive experience selling similar properties in
North Carolina.
Hart shall have a sole and exclusive right to sell or rent the
Property for a term of one year. Under the Agreement, Hart will
conduct all negotiations regarding the sale of the Property,
subject to the Debtors' instruction and approval. The Agreement
further authorizes Hart to offer the property for sale for the
sum of $3,900,000.
At the closing of a sale of the Property other than to the
Prospects identified by Binswanger, Hart will be paid the
greater of:
(a) $60,000 or
(b) 6% of
(i) the gross sales price and/or the gross aggregate
rentals for the full initial term of any lease and
any renewal terms and/or extensions of the tenancy,
or
(ii) the fair market value of the Property and/or the
fair market rental value.
The Debtors also agree to pay Hart an additional fee in the
event a tenant that Hart procured purchases all or any part of
the Property.
The Debtors will also pay Hart 25% of all non-refundable deposit
monies retained by them which are not applicable to the purchase
price, and an $18,000 allowance for marketing expenses.
Furthermore, a cancellation fee of $25,000 is due to Hart in the
event that the Debtors remove the Property from the market.
Galey & Lord, a leading global manufacturer of textiles for
sportswear, including cotton casuals, denim, and corduroy, and
is a major international manufacturer of workwear fabrics, filed
for chapter 11 protection on February 19, 2002 together with its
affiliates (Bankr. S.D.N.Y. Case No. 02-40445). When the
Company filed for protection from its creditors, it listed
$694,362,000 in total assets and $715,093,000 in total debts.
Joel H. Levitin, Esq., Esq., at Dechert represents the Debtors
and Michael J. Sage, Esq., at Stroock & Stroock & Lavan LLP,
represents the Official Committee of Unsecured Creditors.
GENTEK INC: Has Until June 9 to Make Lease-Related Decisions
------------------------------------------------------------
GenTek Inc., and its debtor-affiliates obtained the Court's
approval to extend their time to assume, assume and assign, or
reject unexpired leases of non-residential property for 180 days
through and including June 9, 2003, pursuant to Section
365(d)(4) of the Bankruptcy Code.
GenTek Inc., is a technology-driven manufacturer of
communications products, automotive and industrial components,
and performance chemicals. The Company and its subsidiaries
filed for Chapter 11 reorganization on October 11, 2002, in the
U.S. Bankruptcy Court for the District of Delaware (Delaware)
(Bankr. Del. Case No. 02-12986). Mark S. Chehi, Esq., and D.J.
Baker, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP
represent the Debtors in these cases. (GenTek Bankruptcy News,
Issue No. 9; Bankruptcy Creditors' Service, Inc., 609/392-0900)
GENUITY: Court Approves Professional Compensation Protocol
----------------------------------------------------------
Genuity Inc., and its debtor-affiliates obtained an
administrative order from the Court establishing procedures
comparable to those established in other large Chapter 11 cases
for compensating and reimbursing Court-approved professionals on
a monthly basis.
Pursuant to Section 331 of the Bankruptcy Code, all
professionals are entitled to submit applications for interim
compensation and reimbursement of expenses every 120 days, or
more often if the Court permits.
As proposed, the monthly payment of compensation and
reimbursement of expenses of the professionals is structured as:
A. on or before the 20th day of each month after the month for
which compensation is sought, each professional seeking
compensation, other than a professional retained as an
ordinary course professional, will serve a monthly
statement, by hand or overnight delivery on:
-- Steven N. Avruch, Esq., the officer designated by the
Debtors to be responsible for these matters;
-- Don S. DeAmicis, Ropes & Gray, counsel for the Debtors;
-- the Office of the United States Trustee;
-- David Feldman, Kramer, Levin Naftalis & Frankel LLP,
counsel for the Official Committee of Unsecured
Creditors; and
-- counsel to any other statutory committee appointed in
these Chapter 11 cases;
B. the monthly statement need not be filed with the Court and
a courtesy copy need not be delivered to the presiding
judge's chambers since this Motion is not intended to alter
the fee application requirements outlined in Sections 330
and 331 of the Bankruptcy Code and since professionals are
still required to serve and file interim and final
applications for approval of fees and expenses in
accordance with the relevant provisions of the Code, the
Federal Rules of Bankruptcy Procedure and the Local Rules
for the United States Bankruptcy Court for the Southern
District of New York;
C. each monthly fee statement must contain a list of the
individuals and their titles who provided services during
the statement period, their billing rates, the aggregate
hours spent by each individual, a reasonably detailed
breakdown of the disbursements incurred, and
contemporaneously maintained time entries for each
individual in increments of 1/10 of an hour;
D. each person receiving a statement will have at least 15
days after service to review the statement and, in the
event that he or she has an objection to the compensation
or reimbursement sought in a particular statement, he or
she will, by no later than the 35th day following the month
for which compensation is sought, serve on the professional
whose statement is objected to, and the other persons
designated to receive statements, a written "Notice Of
Objection To Fee Statement," setting forth the nature of
the objection and the amount of fees or expenses at issue;
E. at the expiration of the 35-day period, the Debtors will
promptly pay 80% of the fees and 100% of the expenses
identified in each monthly statement to which no objection
has been served;
F. if the Debtors receive an objection to a particular fee
statement, they will withhold payment of that portion of
the fee statement to which the objection is directed and
promptly pay the remainder of the fees and disbursements in
the percentages set forth;
G. if the parties to an objection are able to resolve their
dispute after the service of a Notice Of Objection to Fee
Statement and if the party whose statement was objected to
serves on all of the parties a statement indicating that
the objection is withdrawn and describing in detail the
terms of the resolution, then the Debtors should promptly
pay that portion of the fee statement which is no longer
subject to an objection;
H. all objections that are not resolved by the parties, will
be preserved and presented to the Court at the next interim
or final fee application hearing to be heard by the Court;
I. the service of an objection will not prejudice the
objecting party's right to object to any fee application
made to the Court in accordance with the Bankruptcy Code on
any ground whether raised in the objection or not.
Furthermore, the decision by any party not to object to a
fee statement will not be a waiver of any kind or
prejudice that party's right to object to any fee
application subsequently made to the Court in accordance
with the Bankruptcy Code;
J. every 120 days, but no more than every 150 days, each of
the professionals will serve and file with the Court an
application for interim or final Court approval and
allowance, pursuant to Sections 330 and 331 of the
Bankruptcy Code of the compensation and reimbursement of
expenses requested;
K. any professional who fails to file an application seeking
approval of compensation and expenses previously paid under
this motion when due will:
-- be ineligible to receive further monthly payments of
fees or expenses until further order of the Court, and
-- may be required to disgorge any fees paid since
retention or the last fee application, whichever is
later;
L. the pendency of an application or a Court order that
payment of compensation or reimbursement of expenses was
improper as to a particular statement will not disqualify a
professional from the future payment of compensation or
reimbursement of expenses, unless otherwise ordered by the
Court;
M. neither the payment of, nor the failure to pay, in whole or
in part, monthly compensation and reimbursement will have
any effect on this Court's interim or final allowance of
compensation and reimbursement of expenses of any
professionals; and
N. counsel for any official committee may, in accordance with
the procedure for monthly compensation and reimbursement of
professionals, collect and submit statements of expenses,
with supporting vouchers, from members of the committee
the counsel represents; provided, however, that the
committee counsel ensures that these reimbursement requests
comply with the Court's Administrative Orders dated June
24, 1991 and April 21, 1995. (Genuity Bankruptcy News,
Issue No. 6; Bankruptcy Creditors' Service, Inc., 609/392-
0900)
GLOBAL CROSSING: Seeks Go-Signal to Reject Headquarters Lease
-------------------------------------------------------------
Paul M. Basta, Esq., at Weil Gotshal & Manges LLP, in New York,
relates that Global Crossing Ltd., and its debtor-affiliates'
headquarters are currently located at 7 Giralda Farms in
Madison, New Jersey, where they occupy 203,183 square feet of
space at $555,000 per month. The GX Debtors are no longer in
need of this large amount of space. Accordingly, the GX Debtors
have decided to reject the lease for Giralda Farms and enter
into a lease for a smaller space that will replace Giralda Farms
as their headquarters.
After negotiations with numerous landlords, including MSGW New
Jersey I, LLC, the landlord for Giralda Farms, the GX Debtors
have reached an agreement with 200-224 Park Avenue LLC to enter
into a lease for space located at 200 Park Avenue in Florham
Park, New Jersey. The Florham Park Premises requires
substantial construction and other work before the space is
ready for use and occupancy by the GX Debtors. The Renovations
will take about 90 days to complete. Park Place has asserted
that they will not commence the Renovations until the Court
approves the GX Debtors' entry into the New Lease.
By this motion, pursuant to Sections 363 and 365 of the
Bankruptcy Code, the Debtors seek the Court's authority to:
-- reject that certain non-residential real property lease
dated April 17, 2000, between MSGW and Global Crossing
Development Co. for Giralda Farms; and
-- to enter into the New Lease.
The Debtors also ask Judge Gerber to approve a letter agreement.
At the time the Original Lease was executed, Mr. Basta relates
that 400 Global Crossing employees were working in Giralda
Farms. As of January 17, 2003, only 210 employees are based
there. As a result, much of the 203,183 square feet of space
remains unused. In contrast, the New Lease comprises only 45,000
square feet of space.
By rejecting the Original Lease, the Debtors will eliminate
$555,000 in monthly payment obligations, thus substantially
reducing their monthly administrative expenses. Accordingly,
the Debtors seek the Court's permission to reject the Original
Lease effective the earlier of February 28, 2003 or the
Effective Date of the Plan.
The principal terms and conditions of the New Lease are:
A. Premises Leased: 45,000 square feet of the third floor of
the building located at 200 Park Avenue in Florham Park,
New Jersey;
B. Base Rent: $990,000 for the first lease year; $1,350,000
for the second lease year; $1,440,000 for the third lease
year; and $1,485,000 for the fourth through seventh lease
years. The Base Rent is subject to adjustment;
C. Term: 7 years;
D. Security Deposit: $1,350,000, subject to adjustment;
E. Assignment and Subletting: The Debtors may assign the
Lease only with Park Avenue's prior written consent,
subject to certain terms and conditions;
F. Termination: During the first 180 days of the lease term,
the Debtors will have a one-time right to terminate the
New Lease, which termination will be effective on the day
immediately preceding the first anniversary of the
Commencement Date of the New Lease, provided that
simultaneously with the termination the Debtors will pay
Park Avenue $2,790,000.
Mr. Basta admits that the Florham Park Premises will not be
ready for occupancy until 90 days after the Court order
rejecting the Giralda Farms lease. To ensure that the Debtors
have access to sufficient office space during this interim
period, the Debtors have entered into a Letter Agreement, which
allows them to remain in a limited portion of Giralda Farms
until the Renovations to the Florham Park Premises are complete.
The salient terms of the Letter Agreement are:
A. Option Periods: The Debtors will have the right to three
successive options to remain in possession of the entire
Demised Premises subsequent to February 28, 2003 for an
additional period of 30 days;
B. Terms and Conditions: The terms and conditions of the
Original Lease will be in effect during each of the
Option Periods, except that:
-- the Monthly Fixed Rent payable during each of the
Option Periods will be an amount equal to $136,791.67
for the entire Demised Premises, which amount is
calculated at the rate of $24.50 multiplied by a
deemed Rentable Area of 67,000 square feet; and
-- all other terms in the Lease that are calculated using
the Rentable Area as a factor will be appropriately
adjusted based on the deemed Rentable Area, including
the Tenant's Proportionate Share;
C. Notice: The Debtors will give notice in writing to MSGW
of its intention to extend its occupancy at least 20 days
prior to February 28, 2003 and at least 20 days prior to
the expiration of the first or second Option Period, as
the case may be; and
D. Court Approval: The Letter Agreement is contingent on
Bankruptcy Court approval. If approval is not obtained
by January 31, 2003, then the Letter Agreement, and all
rights and obligations of the parties thereunder, will
terminate.
Mr. Basta tells the Court that it is not in the Debtors' best
interests to market the Original Lease for sale or sublease the
underlying property because the rent due under the Original
Lease is greater than its current market value. The Original
Lease -- at $555,000 per month -- is a significant cash drain on
the Debtors' businesses.
Mr. Basta reports that the New Lease is the culmination of a
lengthy process whereby the Debtors negotiated with numerous
Landlords, including MSGW, for a new location for its
headquarters. The Debtors have determined that the terms of the
New Lease are the most favorable of the available alternatives
as it provides sufficient office space at a reasonable cost.
Under the New Lease, the Debtors will pay $117,000 per month for
45,000 square feet of space. In contrast, pursuant to the
Original Lease, the Debtors pay $555,000 per month for 203,183
square feet. Thus, the New Lease allows the Debtors to
drastically reduce their rent obligations and maintain only the
amount of space necessary for their operations.
Mr. Basta further asserts that the Letter Agreement ensures that
the Debtors will have sufficient office space to meet their
needs during the Interim Period. The Option Periods in the
Letter Agreement provide the Debtors with flexibility to allow
for completion of the Renovations and any attendant delays.
Absent approval of the Letter Agreement, the Debtors would be
forced to move to temporary location for its offices during the
Interim Period at significant cost to the Debtors' estates. By
entering into the Letter Agreement, the Debtors avoid these
costs and the attendant disruption of business.
Pursuant to the Letter Agreement, Mr. Basta notes that the
Debtors' basic rent obligations to MSGW will immediately be
reduced from $555,000 per month under the Original Lease to
$136,791.67 per month during the Interim Period. Furthermore,
because the Debtors have the option to extend their time at
Giralda Farms up to and until May 28, 2003, there will be
sufficient time for Park Avenue to complete the Florham Park
Premises. Thus, the Letter Agreement allows the Debtors to
reduce their monthly rent obligations and to ensure that the
Debtors maintain sufficient office space until the Florham Park
Premises is ready for occupancy. (Global Crossing Bankruptcy
News, Issue No. 33; Bankruptcy Creditors' Service, Inc.,
609/392-0900)
GOLDFARB CORP: Lenders Agree to Amend Unit's Existing Loan Pact
---------------------------------------------------------------
Further to its announcement on January 16, 2003, The Goldfarb
Corporation announced that terms of an agreement have been
reached in principal between its subsidiary, Fleming Packaging
Corporation, and Fleming's lenders to amend its existing loan
agreement. The amendment, which is expected to be signed
shortly, is in response to Fleming's ongoing default under the
loan agreement.
Under the terms of the amendment, Fleming's current board of
directors, other than George Gialenios, President & CEO of
Fleming, will resign. Mr. Gialenios will continue as the sole
director. The Corporation will also sign an irrevocable proxy
authorizing Mr. Gialenios to vote the shares of Fleming held by
the Corporation, thereby relinquishing the Corporation's control
of Fleming but retaining its equity position. Upon execution of
the amendment, Fleming will immediately be put up for sale. In
the meantime, the lenders will continue to advance sufficient
funds to Fleming to continue to operate its business pending the
sale.
In an earlier amendment to the loan facility announced in
December 2002, the Corporation committed to advance US$1.5
million to Fleming by way of subordinated debt, of which it has
advanced US$765,000 to date. Under the current amendment, the
Corporation will be relieved of the obligation to advance
further funds. In the event of a sale, the Corporation will
receive 3.5% the net proceeds under the terms of the amendment,
in addition to its right to participate as shareholder in any
surplus funds resulting from the sale.
The current amendment will expire on February 28, 2003, subject
to extension by the lenders.
Upon implementation of the amendment and transactions described
above, the interest of The Goldfarb Corporation in SMK Speedy
International Inc., will, in effect, be its sole investment. The
Goldfarb Corporation trades on the Toronto Stock Exchange under
the symbol GDF.
GOODYEAR TIRE: Fitch Cuts Senior Unsecured Debt Ratings to B+
-------------------------------------------------------------
Fitch Ratings has downgraded the senior unsecured debt ratings
of The Goodyear Tire & Rubber Company to 'B+' from 'BB' and
placed the ratings on Rating Watch Negative. The rating action
is based on intermediate-term concerns regarding liquidity and
access to capital, most recently reflected in the grant by the
lenders of certain covenant waivers in Goodyear's bank credit
agreements (currently waived through March 7, 2003).
Liquidity concerns center around mounting financial and pension
obligations as the company continues efforts at turning around
its recent operating performance. While Fitch believes that the
bank credit agreements will continue to be a source of available
liquidity for Goodyear, significant changes to the terms and
conditions are likely to occur. The downgrade also reflects the
risk to the unsecured creditors that the banks are granted a
secured position.
Intermediate-term liquidity concerns are augmented by the
continuing operating challenges faced by Goodyear. Challenges
include reversing an extended history of margin decline
resulting from insufficient reductions to its cost structure,
market share losses and a competitive price environment. The
turnaround will be difficult in the face of increasing health
care and pension outlays, recent spikes in raw material prices,
collective labor renegotiations in April 2003, a resurgent
competitive field and a flat outlook for North American
replacement tire market.
At the end of January 2003, Goodyear had approximately $600
million of cash on hand and continued access to $1.1 billion of
committed bank lines with the covenant waiver through March 7,
2003. That $1.1 billion, plus $200 million to back letters of
credit, is available to Goodyear -- according to information
obtained from http://www.LoanDataSource.com-- under two credit
facilities:
* a $750,000,000 Amended and Restated Five-Year Revolving
Credit Agreement dated as of August 13,
2002, among The Goodyear Tire & Rubber
Company, as Borrower, and a consortium of
lenders comprised of:
- JPMorgan Chase Bank,
- Bank One, NA,
- Bank of America, N.A.,
- BNP Paribas,
- CIBC Inc.,
- Commerzbank Aktiengesellschaft
New York and Grand Cayman Branches,
- Royal Bank of Canada,
- Bank of Tokyo-Mitsubishi Trust Company,
- Credit Suisse First Boston,
- Deutsche Bank Securities Inc.,
- Sumitomo Mitsui Banking Corporation,
- ABN Amro Bank N.V.,
- Banca Nazionale Del Lavoro S.P.A.,
New York Branch,
- Barclays Bank PLC,
- Credit Lyonnais New York Branch,
- KeyBank National Association,
- National City Bank,
- The Northern Trust Company,
- Societe Generale,
- Standard Chartered Bank,
- Dresdner Bank AG, New York and
Grand Cayman Branches, and
- Mizuho Corporate Bank, Ltd.
* a $575,000,000 Amended and Restated 364-Day Revolving
Credit Agreement dated as of August 13,
2002, among The Goodyear Tire & Rubber
Company, as Borrower, and a consortium of
lenders comprised of:
- JPMorgan Chase Bank,
- Bank One, NA,
- Bank of America, N.A.,
- BNP Paribas,
- CIBC Inc.,
- Citicorp USA, Inc.,
- Commerzbank Aktiengesellschaft
New York and Grand Cayman Branches
- Bank of Tokyo-Mitsubishi Trust Company,
- Credit Suisse First Boston - Cayman
Islands Branch,
- Deutsche Bank Securities Inc.,
- Sumitomo Mitsui Banking Corporation,
- ABN Amro Bank N.V.,
- Banca Nazionale Del Lavoro S.P.A.,
New York Branch,
- Barclays Bank PLC,
- Wachovia Bank, National Association,
- Societe Generale,
- Credit Lyonnais New York Branch,
- Keybank National Association,
- National City Bank,
- The Northern Trust Company, and
- Standard Chartered Bank
Both credit facilities, http://www.LoanDataSource.comrelates,
contain two key financial covenants:
-- Goodyear covenants that its Interest
Coverage Ratio (a ratio of
Consolidated Operating Income to
Consolidated Interest Expense) will
be no less than:
For the Minimum Interest
Period Ending Coverage Ratio
------------- ----------------
September 30, 2002 2.75 to 1.00
December 31, 2002 2.75 to 1.00
March 31, 2003 3.00 to 1.00
June 30, 2003 3.25 to 1.00
September 30, 2003 3.50 to 1.00
and thereafter
-- Goodyear covenants that it will
maintain Consolidated Net Worth at an
amount not less than $3,800,000,000
plus 50% of the cumulative amount of
Net Income for each fiscal quarter
ended after December 31, 2000 and
excluding any such fiscal quarter for
which Net Income shall have been
negative.
A $700 million accounts receivable facility was recently
extended out to December 2003 with amended rating trigger
levels. Goodyear is currently in compliance with these rating
trigger levels, but further rating deterioration would violate
the compliance and force Goodyear to utilize its liquidity
resources to bring these receivables back on the balance sheet.
Credit measures have shown steady and significant deterioration.
Although the company's interest expense has meaningfully
declined in 2002, this has largely been the result of a decline
in market interest rates. Goodyear is likely experiencing
sharply higher financing costs on its bank, receivables, and any
refinancing activity, which will further impair credit
statistics.
Approximately $600 million of debt comes due over the next
twelve months including bank term loans and a $300 million bond
issuance coming due in March 2003, while in 2004, $809 million
in long term debt comes due. Over the intermediate term,
Goodyear will require continued access to external capital in
order to meet refinancing and pension obligations. Fitch
believes that these and other operating contractual cash
requirements can be satisfied through 2003 with currently
available liquidity, however the next 24-36 months will see a
continuing escalation of cash claims which could translate into
a liquidity squeeze in the absence of an operating turnaround
and sustained generation of positive cash flow. Evidence of an
operating turnaround will be required in order to provide
assurance of continued access to external capital.
Over the next 18 months or so, Goodyear has estimated that it
will be required to contribute an estimated $350-$550 million to
meet its pension funding obligations. Fitch estimates that this
range may be conservative in light of market performance since
this estimate was made at the end of September. Pension
performance through the first nine months of 2002 was a very
onerous -17%. Pension contributions of $138 million in 2002 and
$100 million in 2001 that were made in the form of Goodyear
common stock have been effectively negated by the performance of
Goodyear stock.
2002 U.S. replacement tire market posted another soft year as
passenger tire units shipped slipped 1% to 190.5 million units
following a 4% drop to 192.0 units in 2001. Light truck tire
units shipped showed some recovery gaining 6% to 34 million
units shipped in 2002 after dropping 11% to 32 million units in
2001. Overall light vehicle replacement tire market was
essentially flat for 2002 at 224.5 million units following a 5%
drop to 224.0 million units in 2001. Goodyear's share of these
markets had slipped in 2002 as the Goodyear branded tire share
in passenger cars slipped to 15% of the market in 2002 from
16.5% of the market in 2001. In light truck replacement tires,
Goodyear branded tires slipped to 12.5% of the market in 2002
from 13% of the market in 2001. Goodyear's lower priced Kelly
branded tires also exhibited similar market share loss in 2002.
Goodyear will announce its 4th quarter 2002 and full year
results subsequent to its discussions with the bank group.
This rating is provided by Fitch as a service to users of its
ratings and is based primarily on public information.
Goodyear Tire & Rubber's 8.500% bonds due 2007 (GT07USR1) are
trading at about 69 cents-on-the-dollar, DebtTraders says. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=GT07USR1for
real-time bond pricing.
GREAT LAKES CARBON: Good Margin Management Spurs Outlook Change
---------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on Great
Lakes Carbon Corp., and its parent company Great Lakes
Acquisition Corp., to stable from negative based on the
company's successful management of recent pressures on its
margins.
Standard & Poor's said that at the same time it affirmed its
'B+' corporate credit ratings on the companies. Great Lakes,
headquartered in New York, has consolidated debt of $318
million.
"The outlook revision was warranted after Standard & Poor's
expectation of meaningful margin contraction failed to
materialize," said Standard & Poor's credit analyst Dominick
D'Ascoli. Idled aluminum production, new calcined petroleum coke
capacity, displaced production, and higher oil prices all
pointed to margin pressure at the company. "However," Mr.
D'Ascoli said, "the company has been largely successful in
mitigating these negative events and managing their margins".
Although the company experienced a reduction in sales volumes in
the fourth quarter of 2001 and first quarter of 2002 , margins
held up better than Standard & Poor's expected due to flat
prices and cost reductions. Mr. D'Ascoli said that the relative
stability of the company's margins and its modest capital
requirements should enable it to maintain its financial profile
in the intermediate term.
Standard & Poor's said that its ratings on Great Lakes Carbon
reflect its stable operating margins, overshadowed by its below-
average business position, high customer and supplier
concentration and aggressive debt leverage.
HOCKEY CO.: Ends Talks About Buying Benetton Rollerblade Unit
-------------------------------------------------------------
The Hockey Company, the largest hockey equipment and apparel
company worldwide, wishes to follow-up on previous reports
concerning negotiations between Benetton Group SpA and The
Hockey Company.
The discussions between the two companies regarding the
acquisition of Benetton's Rollerblade business have ceased. The
parties were unable to reach agreement on certain key commercial
terms.
Through its subsidiaries, The Hockey Company, headquartered in
Montreal, Canada, is the world's largest marketer and
manufacturer of hockey equipment and apparel, as well as
National Hockey League authentic and replica jerseys. The
company manufactures and markets products under the CCM(R),
KOHO(R) and JOFA(R) brand names. The CCM(R) HEATON(R) and
KOHO(R) brands of goalie equipment are now prominent in the
world market, while the JOFA(R) brand is the protective
equipment of choice among 99% of NHL professional ice hockey
players.
* * *
As previously reported in Troubled Company Reporter, Moody's
Investors Service assigned low-B ratings to The Hockey Company.
Outlook of the ratings is stable.
Rating Actions:
* $125 million senior secured notes due 2009, B2;
* Senior Implied, B2;
* Senior Unsecured Issuer Rating, B3.
The ratings reflect the many risks THC faces in operating in a
competitive and low-growth industry. In order to maintain its
market share, the company must consistently produce new products
and incur large expenditures in the promotion and endorsement of
them. Hockey equipment, which comprises the bulk of their
products, is also a highly seasonal market and concentrated
mostly in the northern regions. Moreover, THC's has acquired the
exclusive right to sell NHL jerseys which is risky since this
would be subject to fashion trends and overall fan interest to
the NHL.
HQ GLOBAL: Gets Plan Filing Exclusivity Extension Until May 13
--------------------------------------------------------------
By order of the U.S. Bankruptcy Court for the District of
Delaware, HQ Global Holdings, Inc., and its debtor-affiliates
obtained an extension of their exclusive periods. The Court
gives the Debtors, until May 13, 2003, the exclusive right to
file their plan of reorganization, and until July 11, 2003, to
solicit acceptances of that Plan from their creditors.
HQ Global Holdings Inc., one of the largest providers of
flexible office solutions in the world, filed for chapter 11
protection on March 13, 2002 (Bankr. Del. Case No. 02-10760).
Daniel J. DeFranceschi, Esq., at Richards, Layton & Finger,
P.A., and Corinne Ball, Esq., at Jones, Day, Rtavis & Pogue
represent the Debtors in their restructuring efforts. When the
Company filed for protection from its creditors, it listed
estimated assets of more than $100 million.
HUNTLEIGH TELECOMMS: Case Summary & Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Huntleigh Telecommunications Group, Inc.
106 Camille Drive
El Paso, Texas 79912
Bankruptcy Case No.: 03-70097
Type of Business: High Speed DSL Internet Service Provider
in El Paso, Texas
Chapter 11 Petition Date: February 3, 2003
Court: Western District of Texas (Midland)
Judge: Ronald B. King
Debtors' Counsel: Wiley France James, III, Esq.
James, Goldman & Haugland, P.C.
P.O. Box 1770
El Paso, TX 79949-1770
Tel: (915) 532-3911
Debtor's 20 Largest Unsecured Creditors:
Entity Nature Of Claim Claim Amount
------ --------------- ------------
Ross W. Dahman Unsecured Loans $358,378
125 Ciero Bonito to Corporation,
El Paso, TX 79912 Unpaid Expenses
New Edge Networks Vendor $98,299
Universal Service Admin. Vendor $86,538
Co.
Switch Services Vendor $64,308
Young's Dev. Company Vendor $64,000
Precise Capital, L.P. Vendor $51,000
E.Spire Comm. Vendor $50,796
E.Spire Comm. Vendor $42,033
Southwestern Bell Vendor $31,600
Qwest Vendor $29,953
Broadwing Comm. Services, Vendor $27,523
Inc.
Ethergram Networks Vendor $25,000
Qwest Comm. Vendor $21,935
MCI Worldcom Vendor $21,889
Qwest Vendor $17,439
Southwestern Bell Vendor $17,411
Qwest Vendor $15,719
Cave Bryan Vendor $14,393
MCI Worldcom Vendor $13,473
Southwestern Bell Vendor $13,408
I2 TECHNOLOGIES: Plans to Appeal Nasdaq Delisting Notification
--------------------------------------------------------------
i2 Technologies, Inc., (Nasdaq:ITWO) will not be moving to the
NASDAQ Small Cap Market as previously announced. The decision is
a result of NASDAQ's proposed changes to the continued listing
requirements for the NASDAQ National Market. As a result of this
decision, i2 has received from the NASDAQ a delisting
notification, which it plans to appeal.
The NASDAQ Board of Directors recently approved an amendment to
the National Market continued listing requirements that, if
approved by the SEC, could allow i2 to satisfy the National
Market listing requirements if its stock price rises to above
the $1 level within the newly-proposed extended grace period.
Based on the potential listing requirement changes, i2 has
decided to utilize the NASDAQ delisting appeals process to
demonstrate its ability to comply with and maintain the new
listing standards, if approved by the SEC. Therefore, i2 has
withdrawn its application to phase down to the NASDAQ Small Cap
Market and NASDAQ has furnished the company with a notice of
intent to delist for noncompliance with the NASDAQ National
Market's minimum shareholders equity requirement.
The company plans to submit a request for a hearing to appeal
the delisting notification within seven days. Hearings are
generally scheduled 30 to 45 days from the time of request. The
company's stock will continue to trade on the NASDAQ National
Market while the appeal is pending.
In the event that NASDAQ does not accept i2's position regarding
its ability to meet and maintain the National Market continued
listing standards, i2 intends to seek permission to move to the
NASDAQ Small Cap Market at that time.
A leading provider of end-to-end supply chain management
solutions, i2 designs and delivers software that helps customers
optimize and synchronize activities involved in successfully
managing supply and demand. More than 1,000 of the world's
leading companies, including seven of the Fortune global top 10,
have selected i2 to help solve their most critical supply chain
challenges. Founded in 1988 with a commitment to customer
success, i2 remains focused on delivering value by implementing
solutions designed to provide a rapid return on investment.
Learn more at www.i2.com. i2 is a registered trademark of i2
Technologies US, Inc. and its subsidiaries.
As reported in Troubled Company Reporter's January 30, 2003
edition, Standard & Poor's placed its 'B' corporate credit and
other ratings of i2 Technologies Inc., on CreditWatch with
negative implications, following the Dallas, Texas-based
company's decision to re-audit its financial statements for 2000
and 2001. The re-audit follows allegations about i2's revenue
recognition with respect to certain customer contracts.
i2 has notified the SEC of the allegations, and the SEC staff
has opened an informal inquiry into the matter. The CreditWatch
listing reflects uncertainties as to the size and nature of
possible adjustments and the potential for additional
disclosures following the audit.
INTERPUBLIC GROUP: Gets Commitment for New $500M Credit Facility
----------------------------------------------------------------
The Interpublic Group of Companies (NYSE: IPG) has taken steps
to improve its financial position.
Interpublic has reached agreement with its lenders to amend
certain terms of its $500-million, 364-day multi-currency
revolving credit facility and a similar $375 million, five-year
facility.
Separately, Interpublic announced that it has received from UBS
Warburg a commitment for an interim credit facility providing
for $500 million, maturing by July 31, 2004 and available to
Interpublic beginning May 15, 2003. This commitment will lapse
at such time as the company is in receipt of net proceeds
greater than $400 million from either asset sales or a future
capital markets transaction.
Interpublic also confirmed that NFO WorldGroup, one of the
world's leading marketing research organizations, is being
offered for sale and that Goldman Sachs has been retained to
assist in this process.
Amended Terms of Bank Agreements
The new terms of the bank agreements restrict the company's
ability to pay dividends and make capital expenditures, as well
as limit the ability of domestic subsidiaries to incur
additional debt. Certain of these limitations will be modified
or eliminated upon the receipt of net proceeds greater than $400
million from either asset sales or a future capital markets
transaction. The level of proceeds from such a transaction,
coupled with the company's future earnings performance, will
determine the permitted levels of annual acquisition spending,
share buybacks and dividend payments. No dividend will be paid
on March 15, 2003. The company's future dividend policy will be
determined on a quarter by quarter basis until these
restrictions are lifted.
All limitations on dividend payments and share buybacks expire
when such proceeds exceed $600 million, the company's zero-
coupon notes have been retired and earnings before interest,
taxes, depreciation and amortization (EBITDA) for four
consecutive quarters exceed $1.3 billion.
In addition, the option of the company to extend the maturity of
its 364-day facility for a one-year term, from May 15, 2003, is
restricted until $400 million of net proceeds is realized from
either asset sales or a future capital markets transaction.
Further, Interpublic has agreed to increase the interest rate on
$148.8 million of term loans held by the Prudential Insurance
Company by 0.5%. The amended agreement between Interpublic and
Prudential includes the same restrictions contained in the
company's bank agreements.
The Interpublic Group is among the world's largest advertising
and marketing organizations. Its four global operating groups
are the McCann-Erickson WorldGroup, the Partnership, FCB Group,
and Interpublic Sports and Entertainment Group. Major brands
include Draft Worldwide, Foote Cone & Belding Worldwide,
Golin/Harris, NFO WorldGroup, Initiative Media, Lowe & Partners
Worldwide, McCann-Erickson, Octagon, Universal McCann and Weber
Shandwick.
* * *
As reported in Troubled Company Reporter's December 16, 2002
edition, Fitch Ratings downgraded the following debt ratings for
The Interpublic Group of Companies, Inc.: senior unsecured debt
to 'BBB-' from 'BBB', multi-currency bank credit facility to
'BBB-' from 'BBB', convertible subordinated notes to 'BB+' from
'BBB-' and the short-term debt rating to 'F3' from 'F2'. The
Rating Outlook remains Negative. Approximately $3.0 billion of
debt is affected by this action.
Weak revenue trends and lower than expected operating results
have heightened uncertainties about the ability of IPG to
improve credit measures to a level consistent with the previous
'BBB' senior debt rating, with debt/EBITDA now expected to
operate in a range between 3.0 times and 3.5x and adjusted
debt/EBITDAR in a range between 4.5x and 5.0x, as compared with
Fitch's previous expectations of 2.5x-3.0x and 4.0x-4.5x,
respectively.
JAMES CABLE: Won't Make Feb. Interest Payment on 10-3/4% Notes
--------------------------------------------------------------
James Cable Partners, L.P. , due to its current financial
condition and liquidity position, does not expect to fund the
$5.375 million interest payment due February 15, 2003 on its
10-3/4% Notes due August 15, 2004. If the Company fails to make
such interest payment on the Notes by March 18, 2003, then it
will be an event of default under the Indenture under which the
Notes were issued. Following such a default, either the trustee
under the Indenture governing the Notes or the holders of 25% in
principal amount of the Notes now outstanding could declare such
Notes to be immediately due and payable.
While noting that it is current under its senior credit
facility, the Company indicated that it did not expect to be in
compliance with the facility's senior debt coverage ratio on
March 31, 2003 when that ratio decreases from 2.2-to-1 to 2.1-
to-1. The Company also acknowledged that if the Company fails to
make the interest payment on the Notes by March 18, 2003, then
such default under the Notes will be a cross-default under the
Company's senior credit facility. Furthermore, such default
could lead to an acceleration of payment demand by the Company's
senior creditor. Acceleration of payment demands by the
Company's creditors would require the Company to seek a
restructuring through a Chapter 11 bankruptcy reorganization.
The Company said that it was otherwise paying its day-to-day
obligations.
The Company also indicated that it expects that its independent
accountants, in conjunction with the year end audit of the
Company's financial statements, will issue an audit opinion with
respect to the Company's 2002 financial statements that includes
a qualification that raises substantial doubts about the
Company's ability to continue as a going concern.
The Company has retained Financo Restructuring Group as a
financial advisor to consider options relating to refinancing,
raising new capital and restructuring existing debt. In this
role, Financo has begun discussions with the Company's senior
lender and certain holders of the Company's subordinated
debentures to pursue a consensual restructuring of the Company's
debt. In the event a consensual restructuring of the Company's
debt cannot be achieved, and any of the Company's outstanding
debt is declared immediately due and payable, the Company would
not be able to pay such amounts and would likely seek to
reorganize under the provisions of the federal bankruptcy laws.
James Cable Partners, L.P., which is based in Bloomfield Hills,
Michigan, has approximately 64,000 subscribers in rural markets
in nine states. James Cable's Sept. 30, 2002, balance sheet
shows $46 million in assets and a $79 million shareholder
deficit.
KASPER A.S.L.: Turns to Duff & Phelps for Valuation Assistance
--------------------------------------------------------------
Kasper A.S.L., Ltd., and its debtor-affiliates ask for
permission from the U.S. Bankruptcy Court for the Southern
District of New York to employ Duff & Phelps, LLC to assist the
Company with valuation services.
Duff and Phelps will provide valuation services to the Debtors
in connection with Financial Accounting Standards 142 - Goodwill
and Other Intangible Assets, as of January 1, 2002. An FAS 142
valuation analysis typically involves a two-step process.
Apparently, of the six Kasper reporting units involved, three
(which include Kasper Wholesale, Anne Klein Wholesale and Anne
Klein Retail) did not pass the "Step One" process.
Accordingly, Duff & Phelps' engagement will be to review the
"Step One" FAS 142 analysis prepared by a third party. The
second phase of the engagement is to provide an opinion about
the fair value of the identifiable tangible and intangible
assets of each impaired reporting unit to assist the company's
management in determining any goodwill impairment loss as of the
valuation date of January 1, 2002. The Debtors assure the Court
that these services will not duplicate the services to be
performed by the Debtors' independent auditors and tax advisors,
Ernst & Young LLP, the Debtors' financial advisors, Benedetto
Gartland & Company Inc., or the services being performed by
Peter J. Solomon Company Limited, the financial and strategic
advisor for the special committee of Kasper's board of
directors.
Specifically, Duff & Phelps will:
(a) review the FAS 142 "Step One" analysis, prepared by a
third party;
(b) advise management and review the methodologies and
conclusions of value for the reporting units, which
include Kasper Wholesale, Anne Klein Wholesale, and
Anne Klein Retail, and if the carrying value of a unit
exceeds the fair value;
(c) prepare a "Step Two" FAS 142 analysis, which
encompasses determining the actual (if any) goodwill
impairment loss.
The Debtors will pay Duff & Phelps a $60,000 valuation service
fee.
Kasper A.S.L., Ltd., one of the leading women's branded apparel
companies in the United States, filed for chapter 11 protection
on February 5, 2002 (Bankr. S.D.N.Y. Case No. 02-10497).
Alan B. Miller, Esq. at Weil, Gotshal & Manges, LLP represents
the Debtors in their restructuring efforts. When the Company
filed for protection from its creditors, it listed $308,761,000
in assets and $255,157,000 in debts. Kasper's management is
attempting to buy the company out of bankruptcy.
MAIL-WELL INC: Says Improved Q4 Results in Line with Guidance
-------------------------------------------------------------
Mail-Well, Inc., (NYSE: MWL) announced its results for the
quarter and year ended December 31, 2002. The pro forma net
income of New Mail-Well which excludes restructuring and other
charges, the results of operations of assets held for sale,
extraordinary items and the cumulative effect of a change in
accounting principle was $5.3 million on sales of $432 million
during the fourth quarter of 2002, compared to pro forma net
income of $0.7 million, on sales of $428 million during the same
period of 2001. These results reflect performance at the high
end of the guidance management had given. Pro forma net income
of New Mail-Well for the twelve months ended December 31, 2002
was $2.0 million on $1.7 billion of sales, compared to pro forma
net income of $5.6 million on sales of $1.8 billion the previous
year.
In connection with Mail-Well's previously announced
consolidation of ten of its Envelope plants, charges of $4.8
million were recorded during the quarter, bringing the total
cost of this consolidation to $36.3 million for the year. In
August, additional restructuring plans, primarily in the
Commercial Printing segment, were implemented. The Company
closed its printing plant in New York, rightsized several
underperforming printing plants, and began the consolidation of
its web operations. The restructuring, impairment and other
charges incurred as a result of these and other related actions
taken in the quarter were $6.5 million. In total the Company
incurred $93.9 million of such charges in 2002. Finally, the
loss from discontinued operations increased $3.0 million due to
adjustments to the loss from the sale of its prime label
segment. As a result of the foregoing, the Company's net loss
was $2.6 million, and $90 million for the three and twelve
months ended December 31, 2002, respectively prior to the
cumulative effect of a change in accounting principle.
In early 2002, the Company adopted SFAS 142 and, in its Phase I
review, determined that the goodwill of the Commercial Printing
segment was impaired. In the fourth quarter the company
completed the determination of the amount of the impairment and
wrote off $111.7 million of the goodwill recorded by the Print
segment. In accordance with Statement 142, this was recorded as
a cumulative effect of a change in accounting principle. No
further impairment during the year was necessary.
Paul Reilly, Chairman, President and CEO, stated, "The fourth
quarter results confirmed the trends seen in the previous
quarter. The quarter's EBITDA of $39 million, which was at the
high end of the Company's guidance and exceeded analysts'
expectations, was 9% above Q3 of 2002 and 11% above Q4 of 2001
on 1% higher sales. These encouraging results are a reflection
of the many actions we have taken over the past year to improve
our operations and reduce costs. The quarter over quarter
increase in sales has continued as expected. This confirms our
market share gains. The operating results of the Print segment
continue to improve. In both the Envelope and Printed Office
Products segments, EBITDA exceeded 13% of sales. While it
remains difficult to forecast because of the continued
uncertainty in the economy, we expect Q1 2003 to also show
improvement over the same period in 2002."
Reilly also stated, "We continued to generate free cash flow
from operations which was applied to debt reduction. Total free
cash flow from continuing operations for the year was $49
million. Our ability to generate cash from operations and the
fact that we now have no further maturities on our debt until
June of 2005, allows us the financial stability to invest in our
businesses and the flexibility that we require to continue
developing our company through market share gains in all three
of our segments."
Mail-Well (NYSE: MWL) specializes in three growing multibillion-
dollar market segments in the highly fragmented printing
industry: commercial printing, envelopes and printed office
products. It holds leading positions in each. Mail-Well
currently has approximately 10,200 employees and more than 85
printing facilities and numerous sales offices throughout North
America. The company is headquartered in Englewood, Colorado.
* * *
Standard & Poor's has lowered its corporate credit rating on
Mail-Well Inc., to double-'B'-minus from double-'B', its
subordinated debt rating to single-'B' from single-'B'-plus, and
its senior secured and senior unsecured debt ratings to double-
'B'-minus from double-'B'.
Standard & Poor's has also assigned its double-'B'- minus rating
to Mail-Well I Corp.'s $300 million senior secured revolving
bank facility due 2005, which is guaranteed by its holding
company parent, Mail-Well Inc., and all non-borrower
subsidiaries.
The outlook, S&P says, is negative.
Mail-Well I Corp.'s 8.750% bonds due 2008 are currently trading
at about 71 cents-on-the-dollar. At Sept. 30, 2002, Mail-Well,
Inc.'s consolidated balance sheet shows $1.4 billion in assets
and $154 million in shareholder equity.
MAXXIM MEDICAL: Case Summary & 25 Largest Unsecured Creditors
-------------------------------------------------------------
Lead Debtor: Maxxim Medical Group, Inc.
4750 118th Avenue N.
Clearwater, FL 33762
Bankruptcy Case No.: 03-10438
Debtor affiliates filing separate chapter 11 petitions:
Entity Case No.
------ --------
Maxxim Medical, LLC 03-10439
Maxxim Medical, Inc., a Texas corporation 03-10440
Maxxim Medical, Inc. 03-10441
Fabritek La Romana, Inc. 03-10442
Maxxim Investment Management, Inc. 03-10443
Maxxim Operations East, Inc. 03-10444
Maxxim Operations West, Inc. 03-10445
Type of Business: The Debtors are leading suppliers of custom-
procedure trays, nonlatex examination gloves
and other single-use products.
Chapter 11 Petition Date: February 11, 2003
Court: District of Delaware
Judge: Peter J. Walsh
Debtors' Counsel: Brendan Linehan Shannon, Esq.
Edward J. Kosmowski, Esq.
Matthew Barry Lunn, Esq.
Young, Conaway, Stargatt & Taylor
The Brandywine Bldg.
1000 West Street, 17th Floor
PO Box 391
Wilmington, DE 19899-0391
Tel: 302 571-6600
Fax : 302-571-1253
-and-
Myron Treppor, Esq.
Michael J. Kelly, Esq.
Wilkie Farr & Gallagher
787 Seventh Avenue
New York, NY 10019-6099
Estimated Assets: More than $100 Million
Estimated Debts: More than $100 Million
Debtor's 25 Largest Unsecured Creditors:
Entity Nature Of Claim Claim Amount
------ --------------- ------------
Bank of New York, as Loan $117,972,689
Indenture Trustee under
Maxxim Medical Group, Inc.
Notes:
Senior Sub. Discount Notes
due 2009
The Bank of New York
101 Barclay Street, Floor 21 W
New York, NY 10286
Attn: Mary LaGumina
Wilmington Trust Company Loan $74,661,761
Of New York, as Indenture
Trustee under Maxxim Medical,
Inc Notes:
Senior Discount (Holdco) Notes
Due 2010
Rodney Square North
1100 North Market Street
Wilmington, DE 19890
Attn: Corp. Trust Admin.
Wembley Rubber Products Inventory $3,596,757
Lot 1, Jalan 3, Kawasan
Perusahaan Bandar Baru
Salak Tinggi Sepang
Malaysia 43900
Attn: Mike Scaglione
Arthur Andersen LLP Consulting $2,073,751
101 East Kennedy Blvd.
Suite 2200
Tampa, FL 33602
Attn: Robert Westheimer
Novation LLC GPO Fees $1,333,490
75 Remittance Drive
Chicago, IL 60675-1420
Attn: Donna Rali
Tel: 972-581-5109
A Plus International Inc. Inventory $936,430
5138 Eucalyptus Drive
Chino, CA 91710
Attn: David Lee
Dow Chemical Inventory $850,350
2040 Dow Center
Midland, MI 48674
Attn: Mike McDonald
Tel: 989-638-9353
Latex Partners Inventory $782,832
Kamunting Industrial Estate
Kamunting
Malaysia 34600
Attn: Terry Law
Fox Paine & Company LLC Fees $574,469
950 Tower Lane, Suite 1150
Foster City, CA 94404
Attn: Brian Cowley
Microtek Medical Inventory $548,450
PO Box 2407602
Lehmberg Road
Columbus, Ms. 37904
Attn: Karen Williams
Tel: 662-327-1863
PGI Nonwoven Polymer Group Inventory $452,003
PO Box 308
1206 Chicopee Road
Benson, NC 27504
Attn: Candy Littleton
Adenna Inc. Inventory $382,070
12216 McCann Drive
Santa Fe Springs, CA 90670
Attn: Max Lee
Tel: 562-777-8026
Valley Lab Inventory $372,735
PO Box 100991
Atlanta, GA 30384
Attn: Rose
Tel: 800-255-8522
Smurfit Stone Container Inventory $352,868
2606 Wilco Blvd.
Wilson, NC 27893
Attn: Terry Ford
Tel: 252-293-4145
3M Inventory $323,350
3M Center, 275-4W-02
St. Paul, MN 55144
Attn: Elaine Graffunder
Tel: 800-789-1567x64
American Health Products Inventory $322,464
3483 Eagle Way
Chicago, IL 60670-1340
Attn: Allan Zephyr
Tel: 630-285-9191
Medikmark Inventory $307,423
3600 Bur Wood Drive
Waukegan, IL 60085
Attn: Jim Ronk
Tel: 800-424-8520
Johnson & Johnson Inventory $302,326
425 Hoes Lane
PO Box 6800
Piscataway, NJ 08855-6800
Attn: Kerrianne Frick
Tel: 800-554-7899x3676
Kendall Healthcare Inventory $298,174
Products
Department 00 40110
Atlanta, GA 31192-0110
Attn: Mary Jennings
Tel: 508-261-6118
Boston Scientific Inventory $305,693
One Boston Scientific Place
Natick, MA 01760
Attn: Patty Monroe
Pechiney Plastic Inventory $285,275
Packaging
PO Box 54629
Los Angeles Annex,
CA 90054-4629
Attn: Rob Sandoval
Tel: 828-649-3800
Hospital Disposables Inc. Inventory $251,399
104 Wheeler Street
Portland, TN 37140
Attn: Amy Kelly
Tel: 865-362-3016
Winpak Films Inc. Inventory $237,622
Medsource Technologies Inventory $226,719
Precious Mountain Inventory $208,010
MDC HOLDINGS: S&P Affirms BB+ Corporate Credit Rating
-----------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'BB+' corporate
credit rating on MDC Holdings Inc. At the same time, the outlook
is revised to positive from stable.
The rating actions acknowledge MDC's solid overall financial
profile, including strong cash flow protection measures and
modest leverage, and meaningful efforts to improve geographic
diversity. These strengths are tempered by an ongoing
concentration in soft markets (primarily Colorado) and a lack of
operating history in its recently expanded markets.
Denver, Colo.-based MDC focuses on single-family detached homes
for the entry-level and first time, move-up buyer under its
primary brand name, Richmond American Homes. In 2002, MDC
delivered nearly 9,000 homes and has long maintained operations
in seven states, including Colorado, Arizona, and California.
MDC, the largest homebuilder in Colorado, has recently been
focusing on expanding into new markets, such as Utah and Dallas
- Fort Worth, and bolstering other existing markets such as
Nevada, Arizona, and northern Virginia. This expansion was aided
through the acquisition of substantially all of the homebuilding
operations of John Laing Homes in Las Vegas, Salt Lake City, and
northern Virginia during 2002. However, the company's future
growth is expected to come primarily from organic growth both in
its existing (Nevada and northern Virginia) and newer markets
(Utah and Texas) as MDC intends to leverage existing operations
and overhead while improving geographic diversity. To date, the
company still remains geographically concentrated. Colorado and
Arizona represent a significant 58% of deliveries (down from 62%
at year-ended 2001). However, by early 2004, the contribution
from other markets is expected to strengthen MDC's
diversification and reduce its reliance on the Colorado and
Arizona markets. A modest increase in deliveries and an emphasis
on controlling costs during the recent strong housing cycle has
helped drive gross and operating margins to more than 20% and
10%, respectively. Additionally, MDC's prudent inventory
management (the company's three-year land supply is
approximately two-thirds owned) and solid inventory turnover
(near 2x) should continue to support the company's solid returns
(return on permanent capital currently in the mid-20% area).
LIQUIDITY
MDC Holding's financial profile is very strong for its rating,
and is not expected to change materially as the company grows.
Leverage (not considering cash balances) remains in the mid-30%
area as of September 2002. Aside from the company's lot options,
there are no other off-balance-sheet financings (such as joint
ventures). The company's debt maturity schedule is very
manageable and the only near-term maturity is a mortgage
warehouse facility due in 2003 ($154 million outstanding at
year-ended 2002. Additionally, the company's solid cash flow
(driven by low leverage and strong operating margins) has
produced EBITDA/interest coverage of 14x and corporate and
homebuilder debt to EBITDA of 1.8x at September 2002, both of
which are stronger than average. These measures are expected to
remain relatively stable as the company continues to prudently
expand its business. The company derives ample liquidity from
modest cash balances and a $600 million unsecured credit
facility (matures in 2006), which had no borrowings outstanding
at year-ended 2002.
OUTLOOK: POSITIVE
MDC has performed solidly in the past few years, achieving solid
top- and bottom-line growth during the recent strong housing
cycle while modestly improving its geographic diversity. Recent
growth has been completed while maintaining healthy operating
margins and a solid financial profile. This conservative
financial profile gives MDC ample capacity to continue to pursue
its growth expectation of doubling in size over the next five
years. Standard & Poor's expects that ratings could improve
longer term should MDC continue to improve its geographic
concentration while maintaining its current solid financial
profile.
MIDLAND COGENERATION: Reports Improved Fourth Quarter Results
-------------------------------------------------------------
The Midland Cogeneration Venture Limited Partnership announced
net income of $26.8 million for the fourth quarter of 2002 and
$132.0 million for the year 2002. These net income results
include a $9.9 million mark-to-market gain for the fourth
quarter of 2002 and an $80.0 million mark-to-market gain for the
year 2002, related to an accounting change on nine long-term gas
contracts.
Under implementation guidance approved by the Financial
Accounting Standards Board, natural gas contracts that contain
volume optionality are treated as derivatives and beginning
April 1, 2002 were required to be marked-to-market through
earnings. Prior to April 1, 2002, these contracts qualified as a
normal purchase transaction and did not require mark-to-market
accounting. The cumulative effect of this accounting change as
of April 1, 2002 increased earnings by $58.1 million with an
additional net $21.9 million mark-to-market gain recorded in the
last three quarters of 2002. During the fourth quarter of 2002,
MCV removed the optionality from three of the nine contracts.
However, MCV still expects future earnings volatility since
changes to the mark-to-market activity for the remaining gas
contracts will be recorded on a recurring basis during their
remaining life, which approximates five years.
Net income, excluding the effect of the above accounting change,
was $16.9 million for the fourth quarter of 2002 and $52.0
million for the year 2002. This compares to earnings of $4.5
million for the fourth quarter of 2001 and $48.3 million for the
year 2001. Operating revenues for the fourth quarter of 2002
were $145.7 million and $596.8 million for the year 2002. These
compare to $156.6 million for the fourth quarter of 2001 and
$610.8 million for the year 2001.
The earnings increase for the year 2002 compared to 2001,
excluding the accounting change, was primarily due to lower fuel
usage resulting primarily from a reduced dispatch by Consumers
Energy Company under the MCV/Consumers Power Purchase Agreement
and two significant 2001 one-time charges. In December 2001, MCV
expensed $8.2 million in association with the prepayment of gas
costs under a long-term contract with an affiliate of Enron
Corporation, which was subsequently terminated by the U.S.
Bankruptcy Court. Also in 2001, MCV expensed $6.7 million in
development costs. Other factors contributing to the earnings
increase were lower interest expense on MCV's financing
arrangements and higher electric rates under the PPA, partially
offset by higher natural gas prices under MCV's long-term gas
contracts, lower interest income on invested cash reserves and
lower revenues from energy sales outside of the PPA.
Energy delivered under the PPA decreased to 7.7 million megawatt
hours (MWh) for the year 2002 (70.9% dispatch under the PPA)
from 8.2 million MWh for the year 2001 (75.0% dispatch under the
PPA). During the year 2002, MCV consumed 74.3 billion cubic feet
(Bcf) of natural gas at an average cost of $3.04 per million
British thermal units (MMBtu). During the year 2001, MCV
consumed 79.1 Bcf of natural gas at an average cost of
$2.71/MMBtu.
MCV was formed in 1987 to construct, own, and operate a gas-
fired, combined-cycle cogeneration facility in Midland,
Michigan. The plant is capable of producing approximately 1,500
megawatts of electricity and up to 1.35 million pounds per hour
of process steam for industrial use.
MCV partners include CMS Midland, Inc., a subsidiary of CMS
Energy Corporation; The Dow Chemical Company (limited partner);
and El Paso Midland, Inc., and other affiliates of El Paso
Corporation.
As previously reported in Troubled Company Reporter, Fitch
Ratings lowered the rating of Midland Cogeneration Venture LP's
$567 million subordinate lease obligation bonds to 'BB' from
'BB+'. The rating remains on Rating Watch Negative.
The rating action followed the previous downgrade of the senior
unsecured debt of Consumers Energy Co., MCV's principal
offtaker, to 'BB' from 'BB+'; Consumers remains on Rating Watch
Negative. Absent counterparty credit concerns, Fitch views the
credit quality of the MCV bonds to be of low investment grade
quality.
MISS. CHEMICAL: Commences Trading on OTCBB Under New MSPI Symbol
----------------------------------------------------------------
Mississippi Chemical Corporation (NYSE: GRO) announced that that
its shares of common stock began trading on the Over-The-Counter
(OTC) Bulletin Board, Monday, February 10, 2003, under the
symbol MSPI. The last day of trading of Mississippi Chemical's
stock on the New York Stock Exchange took place Friday,
February 7, 2003.
The OTC Bulletin Board is a regulated quotation service that
displays real-time quotes, last-sale prices and volume
information on more than 3,600 OTC equity securities.
Information regarding the OTC Bulletin Board can be found at
http://www.otcbb.com
Mississippi Chemical Corporation, through its wholly owned
subsidiaries, produces and markets all three primary crop
nutrients. Nitrogen, phosphorus and potassium-based products are
produced at facilities in Mississippi, Louisiana and New Mexico,
and through a joint venture in The Republic of Trinidad and
Tobago.
As previously reported, Fitch Ratings affirmed Mississippi
Chemical Corporation's senior secured credit facility at 'CCC+'
and the senior unsecured notes at 'CCC-'. The ratings have been
removed from Rating Watch Negative. The Rating Outlook is
Negative.
NATIONAL AIRLINES: US Trustee Wants Case Converted to Chapter 7
---------------------------------------------------------------
The United States Trustee for Region 17 asks the U.S. Bankruptcy
Court for the District of Nevada to convert National Airlines,
Inc.'s chapter 11 proceeding to a Chapter 7 liquidation.
The U.S. Trustee's Motion doesn't have the Debtor's and
Creditors' Committee's support. Craig D. Hansen, Esq., at
Squire, Sanders & Dempsey L.L.P., in Phoenix, counsel to the
non-operating carrier, told Barry Jenkins, Esq., at the U.S.
Trustee's office last month that conversion will negatively
impact the company's ability to collect the remaining IATA and
other clearing house receivables . . . to the detriment of all
creditors. Blaine F. Bates, Esq., at Haynes and Boone, L.L.P.,
stressed that Committee "agree[s] with the Debtor that there
should be dialogue between the Committee, the Debtor and the
U.S. Trustee's office regarding the timing of [a] conversion to
chapter 7."
The UST tells the Court that converting this case to Chapter 7
is justified because the Debtor's shut-down their operations in
November 2002, and unnecessary chapter 11 administrative
expenses are mounting.
After shutting down its operations, National told the court that
the case would be converted to a Chapter 7 liquidation. To
date, the debtor has not voluntarily converted this case to
Chapter 7. Moreover, since the shutdown, the UST has repeatedly
asked the debtor and its counsel to meet with the proposed
chapter 7 Trustee in order to obtain a status report and to
facilitate an expeditious conversion to Chapter 7. Despite the
debtor's assurances and notwithstanding the UST's efforts to
coordinate such meeting, the meeting has not occurred.
The UST reminds the Court that on the request of a party in
interest, the court may convert a Chapter 11 case to a case
under Chapter 7, for the best interests of its creditors and the
estate. A conversion is particularly appropriate here because
of:
(a) continuing loss or diminution of the estate and absence
of a reasonable likelihood of rehabilitation;
(2) inability to effectuate a plan;
(3) unreasonable delay by the debtor that is prejudicial to
creditors; and
(4) termination of a plan by reason of the occurrence of a
condition specified in the plan, which is failure to
obtain financing.
Furthermore, the UST learned that the debtor and debtor's
counsel continue to perform tasks which could be done by a
Chapter 7 Trustee more effectively and inexpensively.
Consequently, the UST believes that allowing this case to remain
in Chapter 11 serves no legitimate purpose.
The UST points to one example would be the Debtor's
ineffectiveness with regard to the claim by the U.S. Dept. of
Labor on behalf of the participants in the National Airlines
health plan that was terminated on October 31, 2002. The plan
is an employee welfare benefit plan supposed to provide medical,
prescription drug, dental and vision benefits for the debtor's
employees and their family members. Over $1 million in claims
accrued prior to plan termination with approximately 4,000
individual claims. Currently, these claims remain unpaid. The
UST argues that the longer this case remains in Chapter 11 and
administrative claims continue to mount, the smaller the pool
for payment of these health care claims.
The Debtor's counsel argues that the appointment of a Chapter 7
trustee would destroy the ability to transfer ownership of the
debtor's FAA certificates as a "substantial change of ownership"
only. The UST disagrees stating that "the transfer of
certificates as a substantial change of ownership would not be
prejudiced if the case were converted and the Chapter 7 Trustee
were allowed to continue to operate the debtor as it has been
operated since November 9, 2002."
Additionally, it has come to the UST's knowledge that certain
creditors have taken possession of hard assets of the debtor to
the detriment of similarly situated creditors. This has
happened with the Debtor's knowledge but without consent by the
Court, the UST and other creditors. Consequently, the UST
maintains that conversion to Chapter 7 and the appointment of a
trustee will facilitate the recovery of assets and equal
treatment of similarly situated creditors.
National Airlines halted operations and dismissed most of its
1,500 employees in early November 2002. The Las Vegas-based
carrier couldn't close on a multi-million dollar financing
package necessary to emerge from chapter 11 as a reorganized
company and was unable to rustle-up an outside equity
investment. In mid-2002, The ASTB declined to provide National
with any form of loan guarantee. National, 48% owned by
Harrah's Entertainment Corp., served Chicago Midway, Chicago
O'Hare, Dallas/Ft. Worth, Los Angeles, Miami, Newark, New York
JFK, Philadelphia and San Francisco with nonstop flights to and
from its Las Vegas hub. When the Company filed for chapter 11
protection in 2001 (Bankr. Nev. Case No. BK-S-00-19258 LBR), it
listed $103,464,700 in assets and debts totaling $119,506,900.
NATIONAL STEEL: U.S. Steel Commences Bargaining Talks with USWA
---------------------------------------------------------------
United States Steel Corporation (NYSE: X) confirmed it will
immediately begin bargaining with the United Steelworkers of
America to reach a new, progressive labor contract covering
facilities now owned by bankrupt National Steel Corporation as
well as the USWA-represented plants of U. S. Steel.
"Our ongoing dialogue with the Steelworkers regarding our mutual
interest in the consolidation of the steel industry and their
concerns about the futures of their members and retirees has led
to a meeting of the minds," said U. S. Steel Chairman Thomas J.
Usher. "We have agreed upon a framework to negotiate a deal that
will be competitive with the contract that the USWA recently
negotiated with International Steel Group with appropriate
adaptation to our circumstances. We are enthusiastic about
starting this process and confident that our relationship with
the Steelworkers will quickly lead to an agreement that will
improve our cost structure and the long-term viability of our
assets, and will facilitate our acquisition of and ability to
operate the National Steel assets currently at auction in
Bankruptcy Court."
The U.S. Bankruptcy Court in Chicago established an auction
period for National Steel's assets that began on February 6 and
will end on April 7.
"We remain very interested in acquiring the assets of National
at the right price and with the right labor agreement. We have a
strong liquidity position, which was further enhanced by our
successful offering last week of $250 million of Mandatory
Convertible Preferred Shares," Usher added. "We continue to
believe that our acquisition of National's assets is the best
solution for National's employees, communities, customers,
suppliers and other stakeholders."
In any bankruptcy auction, the value that U. S. Steel may
ultimately offer for National's assets will depend upon
conditions in the steel and financial markets, as well as the
nature of its agreement with the USWA.
The Company also confirmed that, given the importance of the
issues involved, it has agreed to a USWA request to suspend
taking further actions relative to the sale of the company's
North American steel-related assets with USWA representation,
including the previously announced letter of intent to sell its
raw materials and transportation units, pending the labor
negotiations process.
Visit http://www.ussteel.comfor more information about
U.S. Steel.
National Steel Corp.'s 9.875% bonds due 2009 (NSTL09USR1) are
trading at about 78 cents-on-the-dollar, says DebtTraders. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=NSTL09USR1
for real-time bond pricing.
NAVISITE INC: Elects 3 Independent Members to Board of Directors
----------------------------------------------------------------
NaviSite, Inc. (Nasdaq: NAVI), a leader in Managed Applications
and Managed Infrastructure for the Mid-Market, announced the
election of three new members to its Board of Directors. The new
directors officially elected to the board on January 27, 2003
are James H. Dennedy, President of Strategic Software Holdings;
Kenneth A. MacAlpine, President of KIF Capital Corporation; and
Jim Pluntze, Chief Financial Officer of Lanthorn Technologies.
Each brings the leadership skills necessary to guide NaviSite,
as it realigns for success.
"With the recent acquisitions of ClearBlue Technologies
Management and Avasta -- and a major internal restructuring of
our organization well underway, we felt that now was the right
time to add to our Board of Directors," said Trish Gilligan CEO
of NaviSite, Inc. "We were looking for a team of leaders with
the depth and range of experience necessary to lead NaviSite in
this important new direction, and we wanted to ensure our
compliance with ongoing NASDAQ listing requirements."
Each new director brings a wealth of experience in technology
company management and development and will be a key member of
the NaviSite leadership team.
James Dennedy is the President of Strategic Software Holdings,
LLC, an investment firm making equity investments and buyouts on
behalf of itself and its investors in the enterprise software
industry. Mr. Dennedy also serves on the Board of Directors of
Abridean, Inc., an enterprise software company providing
software provisioning and identity management solutions. Mr.
Dennedy has more than fifteen years of management experience and
is a leader in corporate development, completing numerous
private equity transactions with successful US and European
companies, and directing dozens of strategic combinations with
both private and public companies. Most recently, he prepared
and led the successful acquisition strategy and integration
activities to develop a new managed services business unit for a
$500 million technology company. Formerly Mr. Dennedy served as
President and COO of divine Managed Services, as well as Global
VP at marchFirst, Inc. Mr. Dennedy has a BS in Economics from
the United States Air Force Academy, an MA in Economics from the
University of Colorado and an MBA from Ohio State University.
Kenneth MacAlpine is the president of KIF Capital Corp., a
business consulting and venture capital company located in
Sarnia, Ontario. He is also a Director of Wireless Age
Communications, Ltd., one of the largest providers of wireless
network services in Western Canada. Mr. MacAlpine has
participated as a Board Member with various other public and
private companies including: Leisure Canada, Inc. (CDN:LCN),
located in Vancouver, Canada, and Advanced Systems
International, Inc. (OTC BB:ADSN.OB), located in Southfield,
Michigan. Mr. MacAlpine received his electrical engineering
diploma from David Dale College in Glasgow, Scotland.
James Pluntze has over sixteen years of financial management
experience in both public and private companies. In this
capacity, Mr. Pluntze has worked closely with boards of
directors, audit committees and external auditors contributing
to the oversight, quality and integrity of company financial
statements. Mr. Pluntze is currently CFO at Lanthorn
Technologies, a leading provider of software solutions for
electric, gas and water utilities where he is responsible for
strategic planning, raising venture capital and all
administrative functions. Prior to his role at Lanthorn, Mr.
Pluntze has served as a financial executive at several major
technology companies. He was CFO for Guardent, Inc., a provider
of security consulting and managed services, as well as Vice
President of Finance at Razorfish, Inc. (Nasdaq: RAZF),
International Integration, Inc. (formerly Nasdaq: ICUB), and
Boston Treasury Systems, Inc. Mr. Pluntze has a BA in Economics
from the University of Washington and an MBA from Northeastern
University.
"It is important for our customers to have confidence that our
Board is comprised of successful, qualified leaders," stated
Andy Ruhan, Chairman of the NaviSite Board of Directors. "Our
primary goal will be to continue building NaviSite into a
profitable market leader."
NaviSite, Inc., a leader in "Always On Managed Hosting(SM)" for
companies conducting mission-critical business on the Internet,
including enterprises and other businesses deploying Internet
applications. The Company's goal is to help customers focus on
their core competencies by outsourcing the management and
hosting of their Web operations and applications, allowing
customers to fundamentally improve the ROI of their web
operations. NaviSite's solutions provide secure, reliable, co-
location and high-performance hosting services, including high-
performance Internet access, and high-availability server
management solutions through load balancing, clustering,
mirroring and storage services. In addition, NaviSite's enhanced
management services, beyond basic co-location and hosting, are
designed to meet the expanding needs of businesses as their Web
sites and Internet applications become more complex and as their
needs for outsourcing all aspects of their online businesses
intensify. The Company's application services, which include
application hosting and management, provide cost-effective
access to, as well as rapid deployment and reliable operation
of, business-critical applications. For more information about
NaviSite, please visit http://www.navisite.com NaviSite is
headquartered at 400 Minuteman Road, Andover, MA 01810 and is
majority-owned by ClearBlue Atlantic, LLC, an affiliate of
ClearBlue Technologies Inc.
NaviSite, whose October 31, 2002 balance sheet shows a total
shareholders' equity deficit of about $744,000, is headquartered
at 400 Minuteman Road, Andover, MA 01810 and is majority-owned
by ClearBlue Atlantic, LLC, an affiliate of ClearBlue
Technologies Inc.
NETROM INC: Inks LOI to Acquire Tempest Asset Management
--------------------------------------------------------
Netrom, Inc., (OTC:NRRM) has signed a letter of intent to
acquire Tempest Asset Management, Inc., of Irvine California.
Tempest is a Foreign Currency Exchange trading firm founded in
2001 by Chris Melendez, the company's CEO and internationally
renowned currency trader.
"Forex" is a term that refers to the Foreign Currency Exchange
Market where a trader simultaneously buys one currency and sells
another for profit. Forex is the world's largest financial
market with an estimated average daily trading volume of more
than $1.5 trillion, which is approximately 75 times greater than
that of the entire New York Stock Market. This market has
historically been dominated by large financial institutions,
which for centuries have engaged in Forex trading in support of
the trading of goods, as well as for profit (Bank of America
reported Forex trading income of $541 million in their 2001
Annual Report). These institutions generate large profits year
after year, even when there are extreme fluctuations in the
world's economies or the markets for stocks, bonds and
commodities. Tempest's mission is to bring this Forex investment
opportunity to individual investors worldwide.
Melendez stated, "As a result of this acquisition by Netrom,
Tempest has the potential to become a major player in the Forex
industry. It provides Tempest with access to capital, which is
critical to its growth." Forex based investments can be highly
profitable even in the presence of the current harsh global
political and economic conditions. This fact makes it possible
for Tempest to attract investors who are sitting on over $2
trillion that is currently idle in the money markets because of
the flight of capital from stocks caused by the current bear
market. He further stated, "Once the individual investors
discover the safety in Forex based investing, they will make it
a permanent part of their investment strategy for the future."
Melendez has been a keynote speaker at seminars and universities
around the world, including appearing alongside George Bush Sr.
and Henry Kissinger at a symposium on economic reform. He writes
articles and is quoted on a regular basis in many of the world's
top financial publications, including: Reuters, Bloomberg, The
Wall Street Journal, Investor's Business Daily, and The
Financial Times. He also does a regularly scheduled broadcast on
WebFN (a web based financial news service) at
http://www.webfn.com He was named by Bridge News as one of the
best short-term traders in the world.
Melendez brings with him an extensive resume with well over a
decade of experience in the Forex industry stretching from Wall
Street to other major financial centers around the world. He and
his professionally trained staff form an investment team that
ranks among the very best in the industry. He was trained at
Deutsche Bank, New York/Frankfurt in the late 1980s, and then
became a currency trader at Standard Chartered Bank in Los
Angeles/London/Singapore. He then went on to become the youngest
Vice President/Senior Trader at Smith Barney Shearson of New
York. His expertise in the currency field did not go un-noticed,
and in 1994 he became one of the Chief Currency Traders at
Credit Lyonnais Rouse of New York and London. While at Credit
Lyonnais Rouse he developed the system of trading that he
currently uses, which helped him to become the top global
currency trader in the entire firm. "Chris Melendez has a
formidable reputation with the Wall Street money center banks.
We very much value his exhaustive repertory of contacts
throughout the Forex trading world," says Alex H. Ladouceour,
President of Credit Lyonnais Rouse.
Netrom has spent the last six months restructuring the Company
and seeking a suitable candidate for an acquisition. "We are
excited about the opportunity Tempest represents for current and
future Netrom Shareholders," said Netrom President John
Castiglione. Netrom expects to conclude this transaction and
execute contracts within the next two weeks, at which time it
plans to release further details to the public.
Netrom, Inc. (OTC:NRRM), headquartered in San Diego, was founded
in 1996. Since its inception, Netrom has been involved in the
development of technologies that are related to the Internet, as
well as developing new eBusiness models. In the first quarter of
2000 Netrom became insolvent and was forced into a major
reorganization. The company has been in the process of a
turnaround of its business with the primary objective being to
restore trading of its stock to the OTC BB and grow the company
through strategic acquisitions.
Tempest Asset Management, Inc., is a development stage
California Corporation headquartered in Irvine, California. The
company provides institutional grade, Forex trading products and
services to individual investors. "Forex" is a term that refers
to the Foreign Currency Exchange Market where a trader
simultaneously buys one currency and sells another for profit,
which is not dependent on the market conditions of stocks, bonds
or commodities. The Company was founded in 2001 by Chris
Melendez, its CEO and internationally renowned Forex trader. He
gained his expertise as a "market maker and proprietary currency
trader" at major financial institutions around the world. For
additional information go to http://www.tempestasset.com
OCTEL CORP: December 31 Working Capital Deficit Tops $11 Million
----------------------------------------------------------------
Octel Corp., (NYSE: OTL) announced financial results for the
fourth quarter and year ended December 31, 2002.
Highlights
- Strong cash generation continues with $100.0million in
the full year
- TEL gross profit year to date further improves to 53.1%
- Restructuring and impairment charge finalized at
$19.5million for 2002, $13.0million non-cash
- Earnings for the full year are $4.15 per share after
$1.55 per share for restructuring
The Company has completed the transitional goodwill impairment
tests as required under FAS 142 and the carrying value of
goodwill is no longer amortized but instead evaluated for
impairment annually. Amortization of goodwill reduced 2001
fourth quarter net income by $12.0million after tax and
$46.6million after tax for the full year 2001. All comparisons
of operating and net income in this press release are made on a
post FAS 142 and diluted per share basis.
Net income for the fourth quarter of 2002 was a loss of $2.3
million compared with a profit of $15.9 million in the
comparable period last year (after adjusting for FAS 142 and
before extraordinary items). The fourth quarter loss in 2002 is
after taking a charge of $16.4million for restructuring.
Net income for the full year 2002 was $52.1 million compared
with $63.5 million in the comparable period last year (after
adjusting for FAS 142 and before extraordinary items). The full
year result for 2002 is after taking a charge of $19.5 million
for restructuring.
TEL (tetraethyl lead) sales for the fourth quarter were $67.9
million, an 8.3% increase over the same period last year on
volumes 15.7% down. Selling prices were well managed and largely
offset the global market volume decline resulting in full year
sales being 3.1% lower than last year. Price increases and a
continued focus on cost control in the UK plant enabled gross
profit for the full year of $136.3million or 53.1% of sales,
2.3% points better than last year. This, together with
comparable operating expenses, resulted in a 4.5% increase in
operating income for the full year (after adjusting for FAS
142).
Sales in Specialty Chemicals were $50.2million, a 3.1% increase
over the fourth quarter of 2001. Full year sales of $180.8
million also showed growth over last year with a 16.0%
improvement. Gross profits for the quarter were down on last
year by $1.8 million or 10.5% due to softness in the market and
investment in new businesses. Full year gross profits were up
9.7% over last year, principally due to the full year effect of
the acquisitions made in 2001.
As outlined in the pre announcement to this release, the Company
has been undertaking a broad and comprehensive review of its
cost base. This resulted in the need to provide for higher
restructuring costs in 2002 of $19.5million the majority of
which related to the Specialty Chemicals business. $13.0million
of the charge is non-cash. It is expected that up to a further
$20million will be incurred during 2003 and 2004 and will be
accounted for in line with FAS 146 "Accounting for Costs
Associated with Exit or Disposal Activities". Collectively these
charges support the Company's stated objectives of being
proactive in managing the continuing decline in demand for TEL,
rationalization of sites and assets to capture synergies and
global investment in support infrastructure to grow the
business.
Cash flow from operating activities remained strong with
$100.0million being generated for the full year 2002. Senior
loan repayments of $88.0million were made during the year.
Octel Corp.'s December 31, 2002 balance sheet shows that total
current liabilities exceeded its total current assets by about
$11 million.
Commenting on the results, Dennis Kerrison, President and Chief
Executive Officer of Octel Corp., said, "The full year results
reflect the trend we have seen throughout the year. TEL
performed exceptionally well with a 5% growth in operating
income despite a 12% decline in volume. Fourth quarter volumes
were hit by the political situation in Venezuela but it is
encouraging to see that this position is improving and
deliveries will resume in quarter 1 or early quarter 2."
"Specialty Chemicals results were below expectations and
disappointing. The market softness identified earlier this year
continued into the fourth quarter. As stated last quarter, we
have injected pace into the acquisition integration process and
have undertaken a comprehensive review of the synergies and
costs associated with this business. In addition, we have
strengthened the management teams and invested in
infrastructure. These proactive steps will enable us to obtain
more significant benefits, partly in 2003, and more fully in
2004."
"The restructuring charge mentioned earlier is an integral part
of our overall business improvement process. We believe that
this programme will provide a sustainable base in Specialty
Chemicals from which we can grow and deliver long-term
shareholder value."
Octel Corp., a Delaware corporation, is a global chemical
company specializing in high performance fuel additives and
special and effect chemicals. The company's strategy is to
manage profitably and responsibly the decline in world demand
for its major product - tetraethyl lead in gasoline - through
competitive differentiation and stringent product stewardship,
to expand its Petroleum Specialties and Performance Chemicals
businesses organically through product innovation and focus on
customer needs, and to seek synergistic growth opportunities
through joint venture, alliances, collaborative arrangements and
acquisitions.
ONE BAYOU PARK: Case Summary & Largest Unsecured Creditors
----------------------------------------------------------
Lead Debtor: One Bayou Park, Ltd.
100 Bagby Street
Houston, Texas 77002
Bankruptcy Case No.: 03-32085
Debtor affiliates filing separate chapter 11 petitions:
Entity Case No.
------ --------
Fast Park, Ltd. 03-31867
Ferguson Contractors, Ltd. 03-32084
Downtown Bayou Corp. 03-32085
Chapter 11 Petition Date: February 3, 2003
Court: Southern District of Texas (Houston)
Judge: Karen K. Brown
Debtors' Counsel: C. Zan Turcotte, Esq.
Law Offices of Percy L. Isgitt PC
4801 Woodway
Suite 222E
Houston, Texas 77056-1885
Tel: 713-572-7678
Fax : 713-572-6585
Estimated Assets: $1 to $10 Million
Estimated Debts: $1 to $10 Million
A. One Bayou's 13 Largest Unsecured Creditors:
Entity Claim Amount
------ ------------
Colwell Electric $247,000
Craig Mechanical $175,000
Rebar Supply $27,888
Dobson Construction Services $10,000
Weisser Security Services $8,668
Sullins, Johnston, Magers $5,173
City of Houston $4,315
Eschman Engineering Co. $4,300
Time Warner Communications $3,500
Progressive Networking Solutions $2,211
Campbell Concrete $1,060
Blueprints Plus $473
A & E Products $103
B. Fast Park's 11 Largest Unsecured Creditors:
Entity Claim Amount
------ ------------
IRS $111,816
A-Tec Engineers $50,000
Secom International, Inc. $40,678
Verison Credit Inc. $31,170
State Comptroller $14,209
Atlas Sign Store $12,744
American Express $10,138
Anco Insurance B/Cs $3,559
Am-Can $1,208
BFI Browning-Ferris Industries $515
Airportparkinglots.com $500
C. Ferguson Contractors' Largest Unsecured Creditor:
Entity Claim Amount
------ ------------
SouthTrust Bank $30,000
D. Downtown Bayou's 20 Largest Unsecured Creditors:
Entity Nature Of Claim Claim Amount
------ --------------- ------------
IRS $327,514
Austin, Texas 77301
Colwell Electric Co., Inc. $103,614
American Express $25,293
Rebar Supply Company $24,809
Mustang Tractor $24,329
Txi Operations,L.P. $19,855
Anco Insurance $18,729
Century Asphalt Materials $16,515
Southern Crushed Concrete Inc. $15,944
United Rentals $14,800
Texas Heavy Equip Repair, Inc. $13,494
Nextel Communications $13,249
Holcim (Us) Inc. $12,775
Aetna Us Healthcare $12,591
Laser Earthmoving $12,480
John M. Hurier $12,000
Inner City Sand $12,000
Bank Of Texas Bank Loan $16,759
Collateral: $7,500
Unsecured: $9,259
Steel Masters, Inc. $9,163
Bank Of Texas Bank Loan $23,623
Collateral: $15,000
Unsecured: $8,623
ORBITAL IMAGING: Wants to Stretch Exclusivity through May 19
------------------------------------------------------------
Orbital Imaging Corporation asks the U.S. Bankruptcy Court for
the Eastern District of Virginia for an extension of time within
which only the Debtor has the right to file a chapter 11 plan
and solicit acceptances of that plan. The Debtors ask for an
extension through May 19, 2003.
Since commencing its case, the Debtor relates that it has
diligently pursued negotiations with its principal debt and
equity holders, the Bondholders, the Series A, Orbital and
MacDonald, Dettwiler and Associates Ltd., with a view toward
proposing a consensual plan of reorganization, while working
with its financial advisors to structure the terms of a plan of
reorganization.
The Debtor submits that an additional extension of the exclusive
period is warranted because:
-- the Debtor's case encompasses many complex issues;
-- the Debtor has made substantial progress toward
confirmation of a plan of reorganization, having already
filed an initial and amended plan of reorganization and
disclosure statement with the Court;
-- through mediation, the Debtor has made significant progress
in resolving issues facing its estate, having reached an
agreement settling may of the issues in which it had
previously been litigating contentiously;
-- the Debtor, the Committee and Orbital have participated in
a successful mediation to resolve their disputes;
-- an extension of the exclusive periods will facilitate
negotiations among the various constituencies without
prejudicing any party in interest; and
-- the Debtor has been diligent in prosecuting other matters
in its chapter 11 case to date.
Further, apart from continuing to work directly on the terms of
and issues related to its plan of reorganization, the Debtor has
responded to the operational and administrative demands of its
chapter 11 case and has worked diligently to advance the
reorganization process. The Debtor has continued to meet with
key customers and has complied with the monthly reporting and
disclosure obligations imposed upon a debtor in possession in
accordance with the guidelines promulgated by the U.S. Trustee.
All the while, the Debtor was until recently forced to expend a
substantial portion of its energy and resources on various
litigation matters, and still is being forced to do so with
respect to various issues and disputes relating to MDA.
Consequently, the requested extension of the exclusive period
will facilitate the Debtor's restructuring efforts by allowing
the Debtor to revise its plan to conform to the terms the Debtor
negotiates with its creditors.
Orbital Imaging Corporation filed for chapter 11 protection on
April 5, 2002 (Bankr. E.D. Va. Case No. 02-81661). Geoffrey A.
Manne, Esq., Shari Siegel, Esq., and William Warren, Esq., at
Latham & Watkins represent the Debtor in its restructuring
efforts. When the Company filed for protection from its
creditors, it listed assets and debts of over $100 million.
OTTAWA SENATORS: Rod Bryden's Offer to Purchase Team Accepted
-------------------------------------------------------------
PricewaterhouseCoopers Inc., the court-appointed monitor of the
Ottawa Senators Hockey Club Corporation, announced that the
offer to purchase the team presented by Mr. Rod Bryden has been
accepted.
After extensive discussions with the key stakeholders, a
conditional purchase and sale agreement has been executed. The
agreement provides the purchaser with a period of exclusivity
for the conduct of due diligence and, subsequent to that, the
closing of the sale process. As OSHCC is under protection of the
Companies Creditors Arrangement Act the sale of the team will be
subject to the Court's approval.
PwC was appointed monitor of OSHCC on January 9, 2003 in court
proceedings commenced by OSHCC for a restructuring of its
affairs and protection from its creditors. Among its duties, PwC
is responsible for the sale of OSHCC's assets and overseeing the
sale process.
OTTAWA SENATORS: Melnyk Disappointed with Creditors' Decision
-------------------------------------------------------------
Eugene Melnyk issued the following statement concerning Monday's
decision by creditors of the Ottawa Senators Hockey Club to
accept a bankruptcy proposal by Mr. Bryden:
"Although I am obviously very disappointed by this decision
and that I will not have the opportunity to submit a viable
financial proposal for the Ottawa Senators, I am pleased that
there remains a possibility for the team to stay in Ottawa and
continue its excellence on the ice. I wish to extend my best
wishes to all the Senators' fans who are arguably some of the
most dedicated and loyal fans in the National Hockey League. I,
as a Canadian, will continue to cheer for the Senators as they
make their bid to bring home the Stanley Cup and have it
appropriately and proudly displayed in our Nations capital."
Mr. Melnyk also confirmed that he had no other interest in
acquiring other National Hockey League franchises.
OWENS CORNING: Q4 Net Sales Slide-Up and Operating Loss Widens
--------------------------------------------------------------
Owens Corning (OTC: OWENQ) reported financial results for the
fourth quarter ended December 31, 2002, as well as results for
the full year 2002.
For the fourth quarter of 2002, the company had net sales of
$1.174 billion, compared to net sales of $1.165 billion for the
same period in the prior year. Owens Corning reported a loss
from operations of $44 million for the quarter, including
charges of $113 million for restructuring and other charges and
$11 million of Chapter 11-related charges. For the fourth
quarter of 2001, the company reported $13 million in income from
operations, including charges of $46 million for restructuring
and other charges, $27 million of Chapter 11-related charges and
$2 million of income from asbestos-related insurance recoveries.
For the quarter, the company had a net loss of $39 million, as
compared to a net loss of $7 million for the fourth quarter of
2001.
Owens Corning ended 2002 with a cash balance of $875 million
compared to $764 million in 2001.
For the full year 2002, the company had net sales of $4.872
billion, compared to $4.762 billion for the full year 2001.
Owens Corning reported a loss from operations of $2.313 billion,
including charges of $2.356 billion for provision for asbestos-
related liabilities, $166 million for restructuring and other
charges, and $96 million of Chapter 11-related charges,
partially offset by $5 million of income from asbestos-related
insurance recoveries. For the year, the company had a net loss
of $2.809 billion. The net loss for 2002 also reflects a non-
cash charge of $491 million ($441 million net of tax) as the
result of the adoption of Statement of Financial Accounting
Standards No. 142, relating to the accounting for goodwill and
other intangibles.
For 2001, the company reported $116 million of income from
operations and net income of $39 million. Income from operations
for 2001 reflected charges of $140 million for restructuring and
other charges, $87 million of Chapter 11-related charges and $7
million of income from asbestos-related insurance recoveries.
"Overall, we are pleased with the financial results of our on-
going business operations for 2002, which exceeded our operating
plan for the year," said David Brown, Owens Corning's chief
executive officer. "Unfortunately, those results tend to be
obscured by the charges that we recorded during the year. When
we resolve our asbestos liabilities and emerge from Chapter 11,
our reported results should once again more clearly reflect the
operational results of our business," continued Brown.
The total asbestos liability of Owens Corning and of its
Fibreboard subsidiary remains subject to review and negotiations
in the company's Chapter 11 proceedings. The company will
continue to review the asbestos reserves for Owens Corning and
Fibreboard on an ongoing basis and make such adjustments as may
be appropriate.
Owens Corning is a world leader in building materials systems
and composites systems. Additional information is available on
Owens Corning's Web site at http://www.owenscorning.comor by
calling the company's toll-free General Information line: 1-800-
GET PINK.
On October 5, 2000, Owens Corning and 17 United States
subsidiaries filed voluntary petitions for relief under Chapter
11 of the U. S. Bankruptcy Code in the U. S. Bankruptcy Court
for the District of Delaware. The Debtors are currently
operating their businesses as debtors-in-possession in
accordance with provisions of the Bankruptcy Code. The Chapter
11 cases of the Debtors are being jointly administered under
Case No. 00-3837. The Chapter 11 cases do not include other U.S.
subsidiaries of Owens Corning or any of its foreign
subsidiaries. The Debtors filed for relief under Chapter 11 to
address the growing demands on Owens Corning's cash flow
resulting from the substantial costs of asbestos personal injury
liability.
On January 17, 2003, the Debtors, together with the Official
Committee of Asbestos Claimants and the Legal Representative for
future asbestos personal injury claimants, filed a Joint Plan of
Reorganization in the U. S. Bankruptcy Court for the District of
Delaware. The Plan is subject to confirmation by the Bankruptcy
Court. As filed, the Plan provides for partial payment of all
creditors' claims, in the form of distributions of new common
stock and notes of the reorganized company, and cash. Additional
distributions from potential insurance and other third-party
claims may also be paid to creditors, but it is expected that
all classes of creditors will be impaired. Therefore, the Plan
also provides that the existing common stock of Owens Corning
will be cancelled, and that current shareholders will receive no
distribution or other consideration in exchange for their
shares. It is impossible to predict at this time the terms and
provisions of any plan of reorganization that may ultimately be
confirmed or the treatment of creditors thereunder.
Owens Corning's 7.700% bonds due 2008 (OWC08USR1) are trading at
about 22 cents-on-the-dollar, DebtTraders reports. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=OWC08USR1for
real-time bond pricing.
PAN AMERICAN: Strong Performance Prompts S&P to Revise Outlook
--------------------------------------------------------------
Standard & Poor's Ratings Services revised the local and foreign
currency outlook on oil and gas producer Pan American Energy LLC
to stable from negative, given a lower level of uncertainties
regarding the oil industry in Argentina in the immediate future
coupled with the outstanding performance of the company despite
the many challenges presented by the changing Argentine economic
environment.
Additionally, Standard & Poor's affirmed its 'CCC+' local and
foreign currency corporate credit ratings on PAE. PAE's total
debt amounted to $613.3 million as of September 2002.
"After the release of Decree 2703/2002 on Dec. 27, 2002,
ratifying the ability of oil producing companies to keep up to
70% of export proceeds abroad, the immediate uncertainties
affecting the debt repayment ability of Argentine oil producing
companies have been reduced. Moreover, despite the introduction
of export duties, temporary export quotas, and pesified natural
gas prices, PAE's financial profile continued to strengthen
boosted by unusually high crude oil prices since the second
quarter of 2002," said Standard & Poor's credit analyst Pablo
Lutereau.
Strong financial performance allowed EBITDA interest coverage to
reach a strong 10.6x for the nine months ended September 2002
from approximately 2.4x in fiscal 1998. Likewise, funds from
operations covered about 50% of the total debt in the nine-month
period ended in September 2002. Standard & Poor's expects PAE's
coverage ratios to remain strong with FFO to total debt above
20% and EBITDA interest coverage of 4x in spite of an eventual
reduction of crude oil prices.
Nevertheless, Standard & Poor's remains concerned about the
future prospects of the Argentine oil and gas industry due to
the uncertainties related to the next presidential elections in
2003, and will continue to closely follow the developments
affecting the industry in order to determine future changes in
credit quality.
"The rating and outlook assume no significant changes in the
regulation affecting the sector after the next presidential
elections in April 2003. Should any such change take place,
ratings will be adjusted in order to reflect either the
improvement or deterioration in the company's repayment
ability," added Mr. Lutereau.
U.S.-incorporated Pan American Energy is a holding company
engaged in exploration and production of oil and gas in
Argentina and Bolivia. The company is the second-largest
Argentine oil and natural gas producer after YPF S.A., with
strong natural gas growth prospects. Pan American Energy is
60%-owned by BP Plc and 40%-owned by Bridas Corp.
PENTON MEDIA: Promotes Preston Vice to Chief Financial Officer
--------------------------------------------------------------
Penton Media, Inc. (NYSE:PME), a diversified business-to-
business media company, announced the promotion of Preston Vice
to chief financial officer.
Vice, 54, served as Penton's vice president of finance from 1982
to 1989, when he was named a senior vice president of the
Company. In these roles he oversaw Penton's finance and
accounting operations, and in 1998, coincidental with Penton's
listing on the New York Stock Exchange, he was named senior vice
president and corporate secretary. He had been serving as
interim CFO since May of 2002 following the departure of former
CFO Joseph G. NeCastro.
Vice held financial management positions at Pittway Corporation,
Penton's former parent company, from 1974 to 1979, then
transferred to Penton in 1979 as director of finance. Prior to
joining Pittway, he worked in public accounting for four years
at the former Coopers & Lybrand.
Vice's responsibilities as CFO include financial management and
planning, public reporting and investor relations.
Thomas L. Kemp, chairman and chief executive officer, said,
"Preston Vice has extensive expertise in finance, accounting,
legal affairs, and public-company issues, coupled with thorough
knowledge of Penton's business and the B2B media industry. The
management of Penton's financial operations and public-company-
related functions is in very good hands as he formally takes on
the chief financial officer role."
Penton Media -- http://www.penton.com-- is a diversified
business-to-business media company that produces market-focused
magazines, trade shows and conferences, and a broad offering of
online media products. Penton's integrated media portfolio
serves the following industries: Internet/broadband; information
technology; electronics; natural products; food/retail;
manufacturing; design/engineering; supply chain; aviation;
government/compliance; mechanical systems/construction; and
leisure/hospitality.
* * *
As previously reported in Troubled Company Reporter, Standard &
Poor's revised its outlook on business-to-business media company
Penton Media Inc., to negative from developing due to additional
concerns about the company's profitability in light of continued
revenue declines and the operating difficulties of key end
markets. Standard & Poor's also affirmed its existing ratings on
Penton, including its single-B-minus corporate credit rating.
Outlook
Ratings could be lowered if Penton fails to maintain adequate
liquidity to fund its operations during this difficult operating
environment.
Ratings List: To: From:
Penton Media Inc.
* Corporate credit rating B-/Negative/-- B-/Dev/--
* Senior secured debt rating B-
* Subordinated debt rating CCC
PEOPLES STORES: Directors Not Held Responsible for Bankruptcy
-------------------------------------------------------------
In a decision highly awaited by the business community, the
Quebec Court of Appeal ruled on February 5 that the directors of
Peoples Stores -- brothers Lionel, Ralph and Harold Wise -- were
not responsible for the company's bankruptcy.
"This decision is a source of relief for every director who is
charged with making decisions on behalf of related companies
which they manage," remarked Eric Lalanne, a lawyer with DE
GRANDPRE CHAIT, representing the Wise brothers.
In 1992, Wise Stores acquired Peoples, an unprofitable division
of Marks & Spencer Canada, a subsidiary of the British retail
giant. Under the terms of the acquisition from Marks & Spencer,
Wise Stores was unable to consolidate its operations and achieve
hoped-for economies of scale. The managerial decisions made by
the Wise brothers could not save Peoples Stores from being
petitioned into bankruptcy by Marks & Spencer Canada.
In 1994, the bankruptcy trustee filed a $32 million suit against
Peoples and its directors. Superior Court ruled in the
trustee's favor in December 1998, and awarded $4.4 million,
ruling that the directors' actions had served the interests of
the parent company Wise Stores, to the detriment of its wholly-
owned subsidiary, Peoples, thereby contributing to Peoples'
bankruptcy.
Last week's verdict overturns the Superior Court decision. In
its judgment, the Appeal Court also stated that Marks & Spencer,
in pressuring to be repaid very quickly, hastened the increasing
financial difficulties of the two companies, Wise and Peoples,
until their bankruptcy in December, 1994.
"A director may be held accountable for decisions he or she
makes that lead to dishonest acts or that bring about a
catastrophe because of willful blindness," said Mr. Lalanne,
"but in this particular case, the good faith of the Wise
brothers was never in doubt. The Appeal Court declared
unequivocally that the decisions of the Wise brothers were not
the cause of the company's bankruptcy, absolving them of any
responsibility in this regard and that it was quite proper for a
wholly-owned subsidiary to provide financial assistance to its
parent corporation."
PIERSON TRUST: Case Summary & Largest Unsecured Creditor
--------------------------------------------------------
Debtor: Pierson Trust
3221 S. Parkwood Drive
Houston, Texas 77021
Bankruptcy Case No.: 03-31406
Chapter 11 Petition Date: January 31, 2003
Court: Southern District of Texas (Houston)
Judge: Letitia Z. Clark
Debtor's Counsel: Robert Hohenberger, Esq.
7887 Katy Fwy
Suite 107
Houston, Texas 77024-2098
Tel: 713-680-9454
Total Assets: $1 to $10 Million
Total Debts: $100,000 to $500,000
Debtor's Largest Unsecured Creditor:
Entity Nature Of Claim Claim Amount
------ --------------- ------------
JTB Services, Inc. Sept. 2002 Construction $9,000
Services
RAND MCNALLY: Files Prepackaged Chapter 11 in Chicago
-----------------------------------------------------
Commercial mapmaker Rand McNally & Company commenced a
prepackaged chapter 11 proceeding yesterday in Chicago to
implement a fast-paced balance sheet restructuring. The goal is
to recapitalize the company and significantly reduce debt,
paving the way for "renewed investment to continue its business
momentum," the Company says. The Chapter 11 filing should not
affect day-to-day operations and the plan contemplates paying
all trade creditors in full.
Rand McNally is a privately held company and does not release
financial information to the public. Chicagoans Andrew McNally
and William Rand founded the company in 1856, and the business
was run by a Rand or a McNally until Sept. 2, 1997, when its was
sold to New York-based AEA Investors for, press reports say,
something between $430 and $535 million. AEA is group of
investors that banded together in 1969 and includes some of
America's richest industrial families, including the
Rockefellers, Mellons and Harrimans. More than a year ago, AEA
hired Deutsche Bank Alex. Brown to scout for a buyer, according
to a report from The New York Times' archives. Hoover's reports
that the Company's 1,000 employees generated roughly $200
million in sales 2001.
The Prepackaged Plan has the support of committees representing
the company's senior and subordinated lenders. Leonard Green &
Partners, a private equity firm specializing in management
buyouts of middle market companies, is the majority holder of
the company's senior debt.
The Plan contemplates:
* paying $30,000,000 of trade debt in full in the
ordinary course of business;
* swapping $250,000,000 of Senior Notes for
$100,000,000 of New Notes plus an 89% equity
stake in the Reorganized Company;
* delivering a small slice of the New Equity to
the holders of $115,000,000 of the existing
Subordinated Notes; and
* preserving a sliver of the New Equity for the
existing shareholders.
Michael Hehir, President and Chief Executive Officer of Rand
McNally, said: "This development demonstrates the progress Rand
McNally is making to execute its strategy. For the past year,
our people have focused on delivering new products, improving
customer satisfaction and strengthening the company's financial
structure. We have made progress, and as we enter the final
phase of our restructuring we are positioned for further gains."
Rand McNally & Company, founded in 1856, is America's
indispensable travel guide, providing mapping, routing and trip-
planning tools for the consumer, business, education and
commercial transportation markets. The company produces print
and electronic products featuring national and local maps for
the United States and Canada, including the Rand McNally Road
Atlas and Thomas Guides. Rand McNally offers trip planning on
randmcnally.com and operates retail stores across the United
States. For more information, call (800) 333-0136 or visit
http://www.randmcnally.com
RESOURCE AMERICA: Taps Lazard to Explore Evening Star Bldg. Sale
----------------------------------------------------------------
Resource America Inc., (NASDAQ:REXI) engaged Lazard Freres, the
New York City based investment bank, to explore the potential
recapitalization or sale of the Evening Star Building in
Washington, D.C. The Evening Star Building, located at 1101
Pennsylvania Avenue NW, is a class 'A' office building in
Washington, D.C., and is one of Resource America's largest real
estate holdings.
Alan Feldman, Senior Vice President of Resource America,
commented, "We believe that the Evening Star Building will
command an enormous premium due to its outstanding tenant base,
premier location and excellent condition. We look forward to
working with Lazard Freres on this transaction."
Resource America, Inc., is a proprietary asset management
company that uses industry specific expertise to generate and
administer investment opportunities for its own account and for
outside investors in energy, real estate and equipment leasing.
For additional information visit its Web site at
http://www.resourceamerica.com
As reported in Troubled Company Reporter's November 28, 2002
edition, Standard & Poor's lowered its rating on Resource
America Inc.'s 12% senior notes due 2004 to 'B-' from 'B'
following a review of the company's capital structure and the
likelihood that high levels of secured bank debt would not be
reduced materially in the near-term. The outlook is stable.
Standard & Poor's rating criteria requires a one-notch
difference between the senior unsecured debt rating and the
corporate credit rating when outstanding secured obligations
exceed more than 15% of total assets, which now is the case for
Resource America. If Resource materially reduces reliance on
secured debt on a sustained basis, Resource's senior unsecured
debt issue rating could be raised.
RESOURCE AMERICA: Fitch Cuts Senior Unsecured Notes Rating to B-
----------------------------------------------------------------
Fitch Ratings has lowered Resource America Inc.'s senior
unsecured debt rating to 'B-' from 'B'. The rating action
affects approximately $65 million in senior unsecured notes. The
Rating Outlook for the company is Stable.
The downgrade reflects the increase in net debt over the last
couple of years as well as the increase of secured debt as a
percentage of total debt in the company's capital structure. As
of the company's fiscal year-end (9/30/02), approximately 60% of
the company's debt outstanding was secured versus lower levels
in prior years. Over the last two years, Resource America has
been free cash flow negative after dividends and distributions
which has partially contributed to the build in net debt. A part
of the 2002 negative free cash flow was attributed to increase
in capex throughout the year in an effort to build natural gas
reserves. Historically, the company has increased its proved
resource base to nearly 135MMcfe in 2002 from 118MMcfe in 1999.
The 'B-' rating reflects the levered nature of the company as it
had approximately $130 million in net debt outstanding as of
9/30/02 versus an average annual cash flow from operations over
the last three fiscal years of approximately $14 million. The
Stable Rating Outlook reflects the expectation that the company
will be able to successfully refinance its senior notes due
August of 2004 and that the company's operations will largely be
cash flow neutral or slightly positive going forward.
Resource America, Inc., is a proprietary asset management
company that has operations in oil & gas, real estate investment
and equipment leasing. The company's oil & gas operations
constitute the largest part of company as that segment comprises
approximately 70% of the company's total EBITDA.
ROWECOM INC: Sues divine to Recover Looted & Diverted Funds
-----------------------------------------------------------
RoweCom, Inc., and its debtor-affiliates are suing divine, inc.,
its parent, for damages. The Company seeks to recover over
$73.7 million which divine has "fraudulently and wrongfully
transferred from RoweCom to itself."
The Debtors allege that the transfers to divine were fraudulent,
preferential, induced by fraud and negligent misrepresentation,
which unjustly enriched divine and deepened RoweCom's
insolvency.
The Debtors ask the Court to strip or pierce the corporate veil
between RoweCom and divine to make divine liable for RoweCom's
obligations, debts and claims asserted against its esates. The
debtors explain that at all relevant times, RoweCom and divine
were operated as a single entity and RoweCom was held out to the
world as an integrated part of divine, consequently stripping
RoweCom of all trappings of corporate separateness. Finally, as
a result of being a single employer, the Debtors assert that
divine should be jointly and severally liable for any WARN Act
liability to RoweCom's employees.
The Debtors relate that divine acquired RoweCom after RoweCom
was merged into a newly-formed, wholly-owned subsidiary of
divine on November 6, 2001. As of the Acquisition Date, divine
was aware that RoweCom was a struggling company which had a
negative net worth. Aside from RoweCom's negative net worth,
divine knew that it was acquiring a financially troubled
company.
As of the Acquisition Date, divine knew that RoweCom was
obligated to pay no less than $40 million to creditors and
publishers on behalf of RoweCom's customers in December 2001.
As part of the Acquisition, divine assumed all of RoweCom's
existing debt obligations and funded RoweCom's current
obligations due to publishers in December 2001. Consequently,
in January 2002, divine was required to pay approximately
$7.4 million in obligations to publishers. All of these
advances and fundings were treated as intercompany loans to
RoweCom from divine.
In its control over RoweCom's operations, divine directed
RoweCom employees to implement programs to obtain prepayments
from its customers, the prepaid program and the "cash first"
program. As a result of these programs, RoweCom came into
possession of more than $65 million of its customers' money
which it was supposed to be holding to pay for future
subscription purchases. All the while, divine represented to
RoweCom that divine would hold such prepayments until RoweCom
was obligated to make payments due to publishers, generally in
the fourth quarter of 2002.
After these prepayments were received by RoweCom, the Debtors
alleged that divine systematically diverted at least $73.7
million from RoweCom's accounts to divine from April 2002
through December 2002. The Transfers comprised prepayments from
RoweCom's customers and revenue received by RoweCom in the
ordinary course of its business.
The Debtors tell the Court that divine knew that RoweCom's
business could not continue absent repayment of the Transfers,
and that RoweCom was rendered insolvent resulting from divine's
looting of RoweCom's assets.
Nevertheless, up to the second week of December 2002, divine
continued to represent to RoweCom that divine would fund all
publisher obligations due in December 2002. Hence, these
representations were fraudulent when made and divine was aware
of the falsity of those representations. The Debtors point out
that these representations were material because RoweCom's
ability to honor the publisher obligations depended on the truth
of these representations. Additionally, RoweCom and its
employees relied to these representations and continued
soliciting prepayments from RoweCom's customers, whereby
allowing divine to make Transfers. This has caused RoweCom to
suffer damage, including falling into breach of agreements with
its customers and being rendered insolvent.
In December 2002, at least $37 million in payments became due to
publishers from RoweCom. Had divine not wrongfully stripped
RoweCom by making the Transfers, RoweCom would have been able to
make these payments. Due to the Transfers, however, RoweCom was
hopelessly insolvent and could not make these payments unless
divine honored its commitment to pay those obligations.
divine owns 100% of the issued and outstanding shares of RoweCom
and is an insider within the meaning of Section 101(31). At all
relevant times, divine controlled and directed the policies and
affairs of RoweCom but divine were operated as a single economic
entity or instrumentality under the control of divine.
To solidify its control over RoweCom, divine appointed Jude M.
Sullivan, the General Counsel, Senior Vice President and
Secretary of divine, as the Vice President, Secretary and the
sole director of RoweCom and all of RoweCom's subsidiaries. Mr.
Sullivan was the conduit for communicating divine's plans for
RoweCom and was responsible for ensuring RoweCom's adherence to
those plans. All RoweCom employees were placed on divine's
payroll and RoweCom's employees received their employee benefits
through divine's health, retirement and other plans, which were
administered by divine.
The Debtors argue that the asset Transfers made to divine are
avoidable pursuant to Section 548 since RoweCom was insolvent as
of the date of the Transfer, and divine knew this for a fact.
Moreover, the Transfers constituted fraudulent transfers, the
retention of which would unjustly enrich divine because:
a. RoweCom conveyed the benefits of the Transfers to divine
without fair consideration or a reasonably equivalent
value in exchange for the Transfers;
b. At the time RoweCom effected the Transfers, RoweCom
lacked the necessary surplus required by law to make a
dividend or distribution, or any net profits to support
a dividend payment, thereby making the Transfers
improper, unlawful, and/or illegal dividend under
Massachusetts General Corporation Law and under
Massachusetts common law; and
c. divine engaged in further inequitable and wrongful
conduct.
Accordingly, the Debtors ask the Court to order divine to
transfer to RoweCom all assets or the value of those assets
Considering divine's "complete exercise of dominion and
control", as the Debtors put it, divine is the alter ego of
RoweCom. Hence, the Debtors want the corporate veil of RoweCom
should be disregarded rendering divine jointly responsible and
legally obligated for the repayment of all obligations, debts
and claims of RoweCom. Likewise, to the extend that RoweCom has
any liability to its employees under the Worker Adjustment and
Retraining Act, divine should also be jointly and severely
liable.
Rowecom, Inc., offers content sources and innovative
technologies and provides information specialists, particularly
in the library, with complete solutions serving all their
information needs, in print or electronic format. The Company,
together with six of its affiliates, filed for chapter 11
protection on January 27, 2003 (Bankr. Mass. Case No. 03-10668).
Stephen E. Garcia, Esq., and Mindy D. Cohn, Esq., at Kaye
Scholer LLC and Jeffrey D. Sternklar, Esq., and Jennifer L.
Hertz, Esq., at Duane Morris, LLP represent the Debtors in their
chapter 11 cases. When the Company filed for protection from
its creditors, it listed estimated assets and debts of over $50
million each.
SAIRGROUP FINANCE: Disclosure Statement Hearing Set for Feb. 20
---------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
will convene a hearing on February 20, 2003, to consider the
adequacy of the Disclosure Statement prepared to explain the
Plan of Reorganization proposed by SAirGroup Finance (USA), Inc.
The hearing will commence at 10:00 a.m., before the Honorable
Stuart M. Bernstein in Manhattan.
All responses or objections to the Disclosure Statement must be
received on or before Feb. 18 and filed electronically in
accordance with General Order M-242, by registered users of the
Court's Case Filing System and by all other parties-in-interest,
on a 3.5 inch disk (with a hard copy delivered to Judge
Bernstein's chambers). Copies must also be served on:
1. Counsel for the Debtor
Allen & Overy
1221 Avenue of the Americas
New York, NY 10020
Attn: David C.L. Frauman, Esq.
2. Joint Counsel for the Ad Hoc Committee
Bingham McCutchen LLP
399 Park Avenue
New York, NY 10222
Attn: Jeffrey Kirshner, Esq.
Clifford Chance US LLP
200 Park Avenue
New York, NY 10166
Attn: Scott D. Talmadge, Esq.
3. the Office of the United States Trustee
33 Whitehall Street
21st Floor
New York, NY 10004
Attn: Tracy Hope Davis, Esq.
Prior to the petition date, SairGroup Finance (USA), Inc.,
participated in and assisted with financing transactions on
behalf of its parent and sole shareholder, SAirGroup. The
Company filed for chapter 11 protection on September 3, 2002.
David C.L. Frauman, Esq., Hugh M. McDonald, Esq., Rachel
Castelino, Esq., and James E. Atkins, Esq., at Allen & Overy,
represent the Debtor in its restructuring efforts. When the
Company filed for protection from its creditors, it listed
$460,161,000 in assets and $582,888,000 in debts.
SEITEL INC: Noteholders Extend Standstill Agreement to Feb. 14
--------------------------------------------------------------
Seitel, Inc., (NYSE: SEI; Toronto: OSL) and its Noteholders have
agreed to extend the date by which an agreement in principle for
the restructuring of the Company's $255 million of Senior Notes
must be reached, until February 14, 2003. The Company's
Standstill Agreement with its Noteholders previously had
required an agreement in principle for this restructuring to be
reached by February 10, 2003.
Seitel markets its proprietary seismic information/technology to
more than 400 petroleum companies, licensing data from its
library and creating new seismic surveys under multi-client
projects.
SIERRA PACIFIC: Issuing $250MM Conv. Notes via Private Placement
----------------------------------------------------------------
Sierra Pacific Resources (NYSE: SRP) is seeking to raise $250
million through a private placement of convertible notes due
2010. The convertible notes will be unsecured (except as
described below) and unsubordinated obligations of Sierra
Pacific Resources.
The offering will be made only to qualified institutional buyers
in accordance with Rule 144A under the Securities Act of 1933.
The net proceeds from the sale of the convertible notes will be
used to redeem approximately $191 million remaining principal
amount of Sierra Pacific Resources' floating rate notes due
April 20, 2003 and to acquire U.S. Government securities that
will be pledged to secure the first five scheduled interest
payments on the notes. Any remaining net proceeds will be used
for general corporate purposes.
The securities to be offered have not been registered under the
Securities Act of 1933 or any state securities laws, and unless
so registered may not be offered or sold in the United States,
except pursuant to an exemption from, or in a transaction not
subject to, the registration requirements of the Securities Act
of 1933 and applicable state securities laws.
Headquartered in Nevada, Sierra Pacific Resources is a holding
company whose principal subsidiaries are Nevada Power Company,
the electric utility for most of southern Nevada, and Sierra
Pacific Power Company, the electric utility for most of northern
Nevada and the Lake Tahoe area of California. Sierra Pacific
Power Company also distributes natural gas in the Reno-Sparks
area of northern Nevada. Other subsidiaries include the
Tuscarora Gas Pipeline Company, which owns 50 percent interest
in an interstate natural gas transmission partnership, Sierra
Pacific Communications, a telecommunications company, and Sierra
Pacific Energy (e-three), an energy conservation services
company.
* * *
As reported in Troubled Company Reporter's October 14, 2002
edition, Standard & Poor's Ratings Services reaffirmed its
single-'B'-plus corporate credit ratings on Sierra Pacific
Resources and its utility subsidiaries Nevada Power Co., and
Sierra Pacific Power Co. Standard & Poor's also affirmed the
double-'B' ratings on the senior secured debt at the two
utilities. All ratings remain on CreditWatch with negative
implications.
SOCAL EDISON: Challenges FERC Settlement With Reliant Resources
---------------------------------------------------------------
The Federal Energy Regulatory Commission (FERC) has failed to
protect and fully compensate California consumers for the
damages they suffered when Texas-based Reliant Resources
deliberately manipulated the California electricity market by
withholding power, Southern California Edison said in a request
for rehearing, filed Monday.
On Jan. 31, 2003, FERC approved a settlement with Reliant,
calling for the company to pay $13.8 million for shutting down
power plants and limiting the amount of power offered to the
now-defunct California Power Exchange for delivery on June 21
and 22, 2000. In announcing the settlement, FERC purported to
put consumers back in the position that they would have been had
Reliant not engaged in its market-manipulation scheme.
SCE called the very limited penalty "surprising," given that
Reliant misled FERC concerning the cause of high prices
experienced in California during the summer of 2000.
"If there was ever any doubt concerning the causes of the
California energy crisis, the evidence now released by the
Commission removes that doubt -- sellers helped create the
crisis by withholding power in a successful exercise of market
power," SCE said in its filing with FERC, which is charged with
regulating wholesale electricity markets. "What is truly
appalling is that although the direction to engage in this
market manipulation came from the highest levels of Reliant's
management . . . other Reliant operatives continued to insist to
this Commission and to the United States Congress that the price
spike in the summer of 2000 was due to market fundamentals
rather than to the unmitigated exercise of market power which we
now know was taking place."
SCE calculated that Reliant's profits from its market-power
abuse totaled at least another $15.5 million when the impacts on
the ancillary services, real-time and forward-contract markets
for the third quarter of 2000 are calculated.
"Reliant's behavior affected more than just the CalPX market
analyzed by FERC staff," explained SCE Director of Market
Monitoring and Analysis Gary Stern. "In fact, the transcripts
released by FERC state that Reliant's chief motivation for
exercising market power was to raise prices for the third
quarter of 2001." SCE does not have access to the data necessary
to calculate Reliant's ill-gotten gains during that period.
In addition, since Reliant was able to inflate prices for all
generators, the cost to consumers is likely to be many times
Reliant's own gain from this abuse, SCE said.
"Approving a settlement agreement that covers only a fraction of
the profits Reliant gained from its schemes sends exactly the
wrong message to market participants concerning this
Commission's willingness to act as an effective cop on the
beat," SCE said in its filing. "[F]urther, approving a
settlement agreement that returns to California consumers only a
small fraction of the unjust and unreasonable rates that they
were forced to pay as a result of Reliant's scheme does a
disservice to the very group that this Commission is charged
with protecting."
SCE noted that preliminary investigations indicate that Reliant
engaged in other behaviors on the relevant dates that were
designed to increase CalPX prices and that SCE reserves the
right to present evidence concerning these other behaviors.
SCE also asked FERC to clarify that the Commission is not
settling SCE's claims against Reliant.
"Edison was overcharged billions of dollars and driven to the
brink of bankruptcy by the market games that Reliant thought
were 'fu-un!'" the company said. "The Commission may not simply
settle these claims away behind closed doors and in a manner
that denies Edison its due process rights."
Given the ambiguities in the FERC order, SCE will seek a
rehearing and ask the Commission to clarify that its Jan. 31
order "in no way impacts the claims that SCE is in the process
of developing against Reliant and/or any other sellers for any
period, including the days of June 21 and 22."
SPECTRASITE: Emerges from Pre-Arranged Chapter 11 Restructuring
---------------------------------------------------------------
SpectraSite, Inc., one of the largest wireless tower operators
in the United States, announced that its Pre-Arranged Chapter 11
Plan of Reorganization went into effect Monday.
The Plan of Reorganization had been confirmed by the United
States Bankruptcy Court for the Eastern District of North
Carolina on January 28, 2003.
The Company also announced that its SpectraSite Communications
subsidiary closed the previously announced sale of its interest
in 545 towers located in California and Nevada to Cingular. Net
proceeds from the sale were $73.5 million and will be used to
repay a portion of the indebtedness outstanding under
SpectraSite Communications' senior credit facility.
As part of the Plan of Reorganization, the Company's legal name
has changed from SpectraSite Holdings, Inc., to SpectraSite,
Inc. Under the Plan of Reorganization, the Company will issue
23.75 million shares of new common stock. Of this amount,
162,915 shares will be reserved for disputed unsecured claims.
The remainder will be distributed to the holders of the
Company's old senior notes, senior discount notes and senior
convertible notes. To the extent that the reserved shares are
not used to satisfy the disputed unsecured claims, they will
also be distributed to holders of the Company's old notes at a
later time.
Holders of the Company's old senior notes, senior discount notes
and senior convertible notes will receive new common stock at
the following rates by way of a mandatory exchange:
Shares of New
Common Stock
Per $1,000 Face
Series CUSIP Amount of Notes
------ ----------- ---------------
10.75% Senior Notes 84760T-AH-3 14.335445
12.50% Senior Notes 84760T-AN-0 14.212825
12.00% Senior Discount Notes 84760T-AB-6 12.381503
11.25% Senior Discount Notes 84760T-AE-0 11.458335
12.875% Senior Discount Notes 84760T-AJ-9 10.002228
6.75% Senior Convertible Notes 84760T-AK-6 13.828240
Also under the Plan of Reorganization, the Company will issue
warrants to purchase 1.25 million shares of new common stock to
holders of the Company's old common stock. Holders of old common
stock will receive a warrant to purchase one share of new common
stock for every 132.9266 shares of old common stock that they
owned as of February 10, 2003. The warrants will have an
exercise price of $32 per share and will expire on February 10,
2010. A Letter of Transmittal and instructions from the
Company's agent will be sent in the next few days to persons who
hold certificates representing old common stock regarding the
return of their old common stock certificates in exchange for
certificates representing warrants. Persons who hold old common
stock through book-entry accounts will receive warrants in book-
entry form on or about February 11, 2003.
Monday was the last day of trading for the old common stock and
the old notes. Under the Plan of Reorganization, the old common
stock and the old notes will be deemed cancelled and of no
further force and effect. The new common stock and warrants are
expected to be available for trading on February 11, 2003. The
new common stock has been assigned the ticker symbol SPCSV. The
warrants have been assigned the ticker symbol SPSWV. The new
common stock and warrants will initially trade on a when-issued
basis. The extent to which an active trading market develops is
dependent upon the interest of holders and market makers in
trading activity.
The Plan of Reorganization involves only the publicly held debt
and equity securities of SpectraSite, Inc., a holding company
without any business operations of its own. The Company's other
creditors and its assets, strategy and ongoing operations were
not affected by the Chapter 11 filing. The Company's
subsidiaries, which are independent legal entities that generate
their own cash flow and have access to their own credit
facilities, have continued to operate normally during the
Chapter 11 process.
Further information concerning the Plan of Reorganization and
the Chapter 11 process can be found on the Company's Web site at
http://www.spectrasite.com
SpectraSite, Inc., based in Cary, North Carolina, is one of the
largest wireless tower operators in the United States. At
September 30, 2002, SpectraSite owned or managed approximately
20,000 sites, including 7,999 towers primarily in the top 100
markets in the United States. SpectraSite's customers are
leading wireless communications providers and broadcasters,
including AT&T Wireless, ABC Television, Cingular, Nextel,
Paxson Communications, Sprint PCS, Verizon Wireless and
Voicestream.
STANDARD MOTOR: Dana Buy-Out Spurs S&P to Keep Ratings Watch
------------------------------------------------------------
Standard & Poor's Ratings Services placed its 'BB-' corporate
credit rating on Standard Motor Products Inc., on CreditWatch
with negative implications following the company's announcement
that it has signed a definitive agreement to acquire the assets
of Dana Corp.'s engine management division for $120 million. New
York, New York-based Standard Motor is highly leveraged, with
total debt of about $176 million on December 31, 2002.
The acquisition will result in an immediate increase in Standard
Motor's debt load and weaker cash flow generation. Consideration
for the purchase will be in the form of cash, a seller note, and
Standard Motor common stock. The cash portion will be financed
with an expansion of the company's existing revolving credit
facility (additional $46 million borrowed), increasing its debt
service obligations, and the proceeds of a public equity
offering ($59 million). The company expects to realize
significant cost savings once the integration of the acquisition
is complete, which management expects to take up to 18 months.
"During the transition period, however, financial risk will be
high as weaker cash flow generation results from integration
costs, which will total $30 million-$40 million over the next
three years, and the currently weak operating performance of the
acquired business, which generates an EBITDA loss of $1 million
per month," said Standard & Poor's credit analyst Martin King.
Standard Motor's currently weak credit protection measures,
with total debt (adjusted for operating leases) to EBITDA of
about 4x and EBITDA interest coverage of 3x, will further weaken
in the next year if the acquisition is completed.
The successful integration of the acquisition would result in a
stronger business and financial profile over time. The acquired
business will essentially double Standard Motor's market share
for engine management products. The comparable product lines and
distribution channels, as well as excess manufacturing capacity
at both companies, should permit Standard Motor to significantly
reduce the cost structure of the combined businesses. Standard
Motor expects incremental EBITDA improvement of $50 million-$55
million once the integration is complete. The acquisition is
expected to close in the second quarter, pending regulatory
approval.
Standard Motor is a manufacturer and distributor of automotive
aftermarket parts, with leading niche market positions for
engine management and temperature control products.
Standard & Poor's will continue to follow events as they unfold,
and will review details of the transaction as well as Standard
Motor's business strategy and debt reduction plans to determine
the impact on credit quality.
SUN MEDIA: Ups Refinancing to C$735M on Strong Market Reception
---------------------------------------------------------------
Sun Media Corporation increased the size of its refinancing to
C$735 million given the strong market reception for its offering
of senior notes and new secured credit facilities. The
refinancing was completed earlier with the closing of the
offering of US$205.0 million 7-5/8% Senior Notes due 2013 lead
by Salomon Smith Barney and new secured credit facilities
consisting of a five-year revolving facility of C$75.0 million
and a six-year term loan B of US$230.0 million jointly lead and
arranged by Bank of America Securities LLC and Credit Suisse
First Boston.
The President and CEO of Sun Media, Mr. Pierre Francoeur, said:
"Obviously the market recognizes the exceptional performance of
Sun Media, one of the best newspaper businesses in North
America. We were confident when we met with prospective
investors that Sun Media's strong performance would be
recognized. The low coupon achieved on the Senior Notes in our
view reflects the market's acknowledgment of the strength of our
operations."
"We are very pleased with the outcome of this refinancing as it
allows us to rebalance our capital structure at an attractive
market rate and provides Quebecor Media with increased financial
flexibility and liquidity. The markets' reception is very
supportive of both Sun Media's financial performance and QMI's
long stated goals of focusing on operating efficiency,
generating robust free cash flow and reducing debt", commented
Pierre Karl Peladeau, President and CEO of Quebecor Inc.
The net proceeds resulting from the refinancing together with
cash on hand are being used to repay in full Sun Media's
borrowings under its former bank credit facilities, redeem its
two series of outstanding senior subordinated notes and pay a
dividend of C$260.0 million to its parent Quebecor Media Inc.,
of which C$150.0 million will ultimately be used to reduce
Videotron ltee's long-term debt.
Sun Media Corporation, a subsidiary of Quebecor Media Inc.,
itself a subsidiary of Quebecor Inc., is the second largest
newspaper publishing company in Canada, publishing 15 paid daily
newspapers and serving 8 of the top 11 urban markets in Canada.
Sun Media also publishes 175 weekly newspapers and shopping
guides and 18 speciality publications.
* * *
As previously reported, Standard & Poor's Ratings Services said
its ratings on media company Quebecor Media Inc., and its
subsidiaries, including Sun Media Corp., and Videotron Ltee,
remain on CreditWatch with negative implications, where they
were placed Sept. 16, 2002.
The CreditWatch update follows Standard & Poor's review of Sun
Media's refinancing plan. Following completion of the announced
refinancing at Sun Media, which is Quebecor Media's newspaper
subsidiary, the ratings on Quebecor Media and its subsidiaries,
including the 'B+' long-term corporate credit ratings, will be
removed from CreditWatch and affirmed, with an expected stable
outlook.
TIERS CREDIT: S&P Puts BB- Class 2 Certs. Rating on Watch Neg.
--------------------------------------------------------------
Standard & Poor's Ratings Services placed its 'BB-' rating on
TIERS Credit Linked Certificates Trust Series 2002-3's $7
million 8.41% class 2 certificates on CreditWatch with negative
implications.
TIERS Credit Linked Certificates Trust Series 2002-3 is a swap-
dependent synthetic transaction and the class 2 certificates are
weak-linked to the rating on the referenced obligation, Host
Marriott L.P.'s 8.45% senior notes, the rating of which was
placed on CreditWatch with negative implications on
February 5, 2003.
TOKHEIM CORP: Danaher Pitches Best Bid for Gasboy Unit's Assets
---------------------------------------------------------------
Danaher Corporation (NYSE: DHR) was the successful bidder for
the assets of Gasboy International, Inc., a unit of Tokheim
Corporation, in an auction conducted pursuant to a bidding
procedures order issued by the United States Bankruptcy Court
for the District of Delaware. The successful bid was for
approximately $38 million. The bid remains subject to approval
by the United States Bankruptcy Court for the District of
Delaware at a sale hearing scheduled to take place on
February 25, 2003. The contemplated transaction remains subject
to other customary conditions. Gasboy, with revenues of
approximately $40 million, is a manufacturer and seller of
commercial electronic and mechanical petroleum dispensing
systems, fleet management systems and transfer pumps, primarily
for non-retail petroleum applications.
Danaher Corporation is a leading manufacturer of
Process/Environmental Controls and Tools and Components. For
more information, visit http://www.danaher.com
UNITED AIRLINES: Court OKs Bank One DIP Financing on Final Basis
----------------------------------------------------------------
Judge Wedoff finds that UAL Corporation and its debtor-
affiliates do not have sufficient available sources of working
capital and financing to continue operating their business. New
funding is vital to the maintenance of the Debtors' going
concern values and to their successful reorganization. The
Debtors must be allowed to enter into the Credit Card
Agreements, loans and other credit accommodations provided for
in the DIP Credit Agreement.
The Court approves the DIP Credit Agreement and all other
related documents on a final basis. All Obligations constitute
superpriority administrative claims.
As previously reported, Bank One agreed to provide United a
stand-alone $300,000,000 amortizing term loan agreement with
that will be secured by, among other things, revenue from
certain Co-Branded Card Agreements. Bank One will make the $300
million immediately available to the Debtors upon the expiration
of the ten-day appeal period (assuming no appeals) following
United's assumption of the Co-Branded Card Agreements
Bank One won't lend the money unless loan is secured by the
revenue stream from the Co-Branded Card Agreements and
conditioned its loan on the Debtors' assuming (1) an Umbrella
Agreement, (2) a Mileage Plus Operating Agreement, (3) a License
Agreement, (4) a Domestic Customer Service Outsourcing
Agreement, and (5) a Side Letter between UAL and UAL Loyalty
Services.
The details of these five agreements:
The Co-Branded Card Agreements
The Debtors formed UAL Loyalty Services in October 2000 with the
intention that ULS would (a) operate as a sales agent for non-
airline partners of the Mileage Plus Program and (b) manage and
develop the Debtors' branded Web sites, including
http://www.united.com
In early 2002, the Debtors determined that the Debtors' primary
customer loyalty and promotion programs should be united in one
organization to reduce administrative duplication and foster a
focused management team to assist in the development of these
important customer programs. Accordingly, in March 2002, through
a series of transactions, the Debtors transferred certain assets
and liabilities relating to numerous loyalty programs from
United to ULS.
UAL, ULS, and Bank One Delaware are parties to the Co-Branded
Card Agreements pursuant to which Bank One Delaware issues co-
branded credit cards with United which cardholders can accrue
mileage credit for travel awards redeemable through the Mileage
Plus program for purchases made with the credit cards.
The Co-Branded Card Agreements are ULS' single largest source of
cash flow. Under the Co-Branded Card Agreements, Bank One
Delaware is required to purchase a designated minimum amount of
miles from ULS on a periodic basis. The designated amount of
miles Bank One Delaware is obligated to purchase from ULS
increases each year for the term of the contract.
The recent amendments to the Co-Branded Card Agreements include,
among other things, additional metrics to gauge the financial
health of United. For example, a specified deterioration of
United's financial health will result in a faster reduction of
guaranteed cash flows to ULS, and a massive deterioration allows
Bank One to terminate the Co-Branded Card Agreements.
The Credit Card Agreements
Although ULS is a stand-alone entity, the value of ULS' loyalty
programs is inextricably linked to the Debtors' airline business
because ULS' programs and services (a) support the Debtors'
existing air travel customer base, (b) provide awards redeemable
for credit on the Debtors' airline through the Mileage Plus
program; and (c) generate ticket sales through the Debtors'
branded website. These synergies are particularly apparent with
respect to the Co-Branded Card Agreements. The Co-Branded Card
Agreements not only provide significant revenue for ULS, but
also foster increased air travel on United. Consequently, the
Co-Branded Card Agreements, together with the related Credit
Card Agreements, form an integral piece of the Debtors' business
plan that should remain in place throughout these Chapter 11
proceedings.
The importance and value of the Co-Branded Card Agreements,
however, depends on the existence of the Credit Card Agreements
between United and ULS because the Credit Card Agreements govern
the obligations of ULS and United with respect to the operation,
maintenance, and development of the Debtors' Mileage Plus
program and branded Web sites, including http://www.united.com
The Umbrella Agreement, for example, contains provisions
governing the Mileage Plus Operating Agreement, that include,
but are not limited to, exclusivity, confidentiality,
warranties, indemnities, termination and dispute resolution.
Pursuant to the Umbrella Agreement, United agrees to continue to
operate its airline business, and ULS agrees to continue
operating the Mileage Plus program, United's branded website and
its other businesses. More specifically, United maintains the
exclusive right to market products and services uniquely
consumed as part of the air travel experience to certain
customers, subject to certain restrictions in the Mileage Plus
Operating Agreement and other Agreements.
In addition, the Mileage Plus Operating Agreement establishes
the relationship between United and ULS in connection with the
Mileage Plus Program. Among other things, the Mileage Plus
Operating Agreement precludes United from using any loyalty
program other than the Mileage Plus program. It also grants
United a license from ULS to issue and sell miles redeemable for
air travel under the Mileage Plus program.
The License Agreement supports the Co-Branded Card Agreements by
providing ULS with irrevocable, nonexclusive, worldwide,
royalty-free licenses to use, among other things, certain United
domain names, trademarks, software, and systems in connection
with the relationships contemplated by the Credit Card
Agreements. In exchange, the License Agreement provides United
with irrevocable, nonexclusive, worldwide, royalty-free licenses
to use certain ULS domain names, software, systems, etc., and
with an irrevocable, near exclusive, worldwide, royalty-free
license to use certain ULS trademarks.
Lastly, the United/ULS Side Letter provides assurances to Bank
One Delaware that UAL, United, ULS, and other named Debtors will
maintain the Umbrella Agreement, Mileage Plus Operating
Agreement, License Agreement, and Domestic Customer Service
Outsourcing Agreement and that the terms of those agreements
will remain in full force and effect. Furthermore, the
United/ULS Side Letter limits the rights of UAL, United, ULS,
and the other named Debtors to make amendments to the
aforementioned agreements.
The principal terms of the Bank One Financing:
Borrower: United Air Lines, Inc.
Guarantors: UAL Corporation and each debtor-subsidiary
Agent: Bank One, N.A.
Lenders: Bank One, N.A., and any other entity
acceptable to the Agent
Sole Lead
Arranger: Bank One Capital Markets, Inc.
Book Manager: Bank One Capital Markets, Inc.
Facility: A $300,000,000 amortizing term credit
facility payable:
Installment Amount Due Date
------------------ --------
$60,000,000 March 1, 2004
$60,000,000 April 1, 2004
$60,000,000 May 1, 2004
$60,000,000 June 1, 2004
$60,000,000 July 1, 2004
Maturity Date: July 1, 2004, at which time all amounts
outstanding are due and payable.
Purpose: For general working capital and other
corporate purposes.
Interest Rate: At the Borrower's option:
(A) Bank One's Base Rate plus 3.5%; or
(B) LIBOR plus 4.5%;
and in the event of a default, the
Interest Rate increases by 200 basis
points.
Fees: Bank One will receive:
(A) a $15,000,000 Closing Fee;
(B) a $1,500,000 Arrangement Fee;
(C) a $3,000,000 Commitment Fee;
(D) an annual $125,000 Agent's Fee; and
(E) daily $750 fees per auditor when
requested by the Administrative Agent.
Priority: All borrowings from Bank One constitute
superpriority administrative claims
against the Debtors' estates pursuant to
11 U.S.C. Sec. 364(c)(1), pari passu with
the $1,200,000,000 DIP Facility lenders'
claims.
Postpetition
Liens: The Debtors' obligations to repay amounts
borrowed from Bank One are secured,
pursuant to 11 U.S.C. Secs. 364(c)(2) and
(3), by perfected first-priority liens on:
(A) all of the Debtors' right, title and
interest in the Co-Branded Credit
Marketing Services Agreement;
(B) all assets of:
* UAL Loyalty Services, Inc.,
* Mileage Plus Holdings, Inc.,
* Mileage Plus Marketing, Inc., and
* Mileage Plus, Inc.,;
(C) all call centers, customer lists,
systems, programs, software, Mileage
Plus tradenames (and any derivations)
and trademarks related to the Affinity
Programs;
and a junior superpriority lien on all
otherwise unencumbered assets securing
the $1,200,000,000 DIP facility.
Financial
Covenants: Identical to the Financial Covenants that
contained in the $1,200,000,000 DIP
Facility.
(United Airlines Bankruptcy News, Issue No. 8; Bankruptcy
Creditors' Service, Inc., 609/392-0900)
DebtTraders reports that United Airlines' 9.00% bonds due 2003
(UAL03USR1) are trading at about 5 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=UAL03USR1for
real-time bond pricing.
US AIRWAYS: Seeks Go-Signal to Reject Jacksonville Airport Lease
----------------------------------------------------------------
US Airways Group Inc., and its debtor-affiliates seek authority
under 11 U.S.C. Sec. and 365(a) to reject a Real Property Lease
at the Jacksonville International Airport effective February 20,
2003. The Debtors, will continue to operate at the Airport and
also seek authority under 11 U.S.C. Section 363 to negotiate a
New Signatory Lease from the Authority. That new agreement will
allow the Debtors to operate on a smaller scale at the
Jacksonville Airport.
John Wm. Butler, Jr., Esq., of Skadden, Arps, Slate, Meagher &
Flom, informs Judge Mitchell that USAir has one signatory
airline lease agreement, entered in 1988, for 6 gates (holdroom
and apron), and associated ticket counter, office, baggage
claim, and administrative facilities to support commercial
passenger service at the Airport.
The Debtors are reducing the size of their operations and flight
schedule at the Airport and seek to rationalize their leasehold
by lowering the number of gates leased to three, along with
Appropriate related facilities including ticket counter offices,
baggage claim, and administrative offices. Due to the reduction
in operations and flights, the other three gates and related
facilities no longer provide benefit to the Debtors. The Lease
does not have any marketable value to the estates and no party
has expressed an interest in accepting an assignment of the Real
Property Lease.
The Debtors estimate that the annual cost for the unutilized
gates and related facilities is $600,000 and the cost over the
remaining life of the Lease is $2,400,000.
The Parties agree that the Debtors will temporarily possess and
access certain portions of the rejected premises until the
reduced space the Debtors' will lease under the New Signatory
Agreement is ready for possession. (US Airways Bankruptcy News,
Issue No. 25; Bankruptcy Creditors' Service, Inc., 609/392-0900)
USG CORP: Royce & Associates Discloses 5.99% Equity Stake
---------------------------------------------------------
Royce & Associates, LLC, a New York Corporation and an
investment adviser registered under Section 203 of the
Investment Advisers Act of 1940, discloses in a regulatory
filing with the Securities and Exchange Commission that it holds
a 5.99% equity stake in USG Corporation. As of December 31,
2002, Royce is deemed the beneficial owner of 2,589,200 shares.
(USG Bankruptcy News, Issue No. 42; Bankruptcy Creditors'
Service, Inc., 609/392-0900)
WHEELING-PITTSBURGH: Seeks Avoidance Action Protocol Extension
--------------------------------------------------------------
Pursuant to the Court-approved Procedures for Preference and
Fraudulent Transfer Actions, Wheeling-Pittsburgh Steel Corp.,
has commenced 366 Avoidance Actions against various defendants.
Subsequent to the commencement of the Avoidance Actions,
numerous Avoidance Action defendants contacted WPSC to inquire
about:
(i) the specifics of the Avoidance Action,
(ii) potential defenses, and
(iii) settlement.
WPSC has received numerous analyses of potential defenses that
it needs to review. WPSC needs additional time to analyze the
various defenses raised by the Avoidance Action defendants
before it can properly enter into settlement discussions with
the defendants.
In addition, the Debtors are currently involved in serious,
substantial negotiations with the appropriate constituencies in
these cases regarding the confirmation of their plan of
reorganization, and are still in negotiations with the Emergency
Steel Loan Guaranty Board regarding their application for a
government guaranteed loan under the Emergency Steel Loan
Guaranty Act to provide exit financing for the Plan.
Thus, the Debtors ask Judge Bodoh to extend these procedures in
each Avoidance Action:
(a) in each Avoidance Action, the Debtors may delay
presenting a summons to the Clerk of this Court
for issuance until on or before May 15, 2003;
(b) on or before May 15, 2003, the Debtors may seek
issuance of a summons for service within 120 days,
or within a longer period as ordered by the Court;
and
(c) the Court will suspend the scheduling of a pretrial
conference, the disclosure requirements and all other
proceedings arising in the Avoidance Action, pending
the issuance of the summons and its service upon the
defendants.
The Debtors assert that the extension of these Procedures in all
Avoidance Actions will provide an appropriate period for WPSC to
analyze alleged defendant defenses and enter into settlement
discussions, where appropriate, while minimizing the time and
expense that WPSC would otherwise have to spend in obtaining
individual Court orders authorizing and approving the extension
of the Procedures in each Avoidance Action.
In addition, the Debtors assert that the extension of the
Procedures in all Avoidance Actions will minimize the burden
that the Clerk's office would otherwise face in having to enter
individual orders approving the extension of the Procedures in
each Avoidance Action.
If approved and adopted, the Extended Procedures will continue
to provide the parties a reasonable period of time to attempt to
reach mutually satisfactory settlements, thereby eliminating the
unavoidable expenses, burdens and risks associated with
litigation. (Wheeling-Pittsburgh Bankruptcy News, Issue No. 34;
Bankruptcy Creditors' Service, Inc., 609/392-0900)
WORLDCOM INC: Wants to Reject 86 Vacant SONET Ring Agreements
-------------------------------------------------------------
Marcia L. Goldstein, Esq., at Weil Gotshal & Manges LLP, in New
York, recounts that by motion dated October 25, 2002, Worldcom
Inc., and its debtor-affiliates sought to reject agreements
related to 49 SONET Rings that they no longer required and did
not use. By orders, dated November 19 and 26, 2002, the Court
authorized the rejection of the Agreements related to 36 of the
SONET Rings. The Debtors received objections to the rejection
of the Agreements related to the remaining 13 SONET Rings
identified in the First Motion.
The Debtors have undertaken an extensive analysis of their
network requirements and have determined that ultimately the
Debtors will not require any of the 13 SONET Rings that are the
subject of the Objections or any of the 73 SONET Rings that were
not included in the First Motion. In accordance with the terms
of the Agreements, Ms. Goldstein reports that the Debtors are
required to pay $3,848,089.50 per month in the aggregate for the
86 Remaining SONET Rings. Based on the expiration dates of the
Agreements, the remaining liability of the 86 Remaining SONET
Rings is $51,500,000 in the aggregate.
Ms. Goldstein relates that the Debtors have obtained, or over
the course of the next several months will obtain, alternative,
more cost-effective connections with their customers formerly
served via the 86 Remaining SONET Rings and related Tail
Circuits. Specifically, the Debtors anticipate being able to
carry the traffic formerly routed through the 86 Remaining SONET
Rings on their own network. Therefore, the Debtors anticipate
that by April 30, 2003, they will have migrated all voice and
data traffic off substantially all of the 86 Remaining SONET
Rings.
Accordingly, by this motion, the Debtors seek the Court's
authority to reject the 86 Remaining SONET Rings and the related
Agreements, effective on the disconnection dated.
The Debtors reserve their rights to assert that any
postpetition, pre-rejection amounts due and owing for any
disconnected SONET Ring or Tail Circuit are not entitled to
administrative expense priority pursuant to Section 503 of the
Bankruptcy Code.
According to Ms. Goldstein, as of January 24, 2003, the Debtors
have already migrated the traffic off 27 out of the 86 Remaining
SONET Rings. After vacating a SONET Ring, the Debtors will no
longer require the ring.
Because the 86 Remaining SONET Rings and Tail Circuits are
connections between the Debtors' network and the Counterparties'
networks, Ms. Goldstein contends that the 86 Remaining SONET
Rings are not useful for third parties and the Debtors cannot
sell or assign the services provided under the Agreements.
Following migration of the traffic, the 86 Remaining SONET Rings
and Tail Circuits will no longer serve any useful purpose for
the Debtors. The Debtors' estates will be benefited by
eliminating these unnecessary payment obligations associated
with the 86 Remaining SONET Rings and the Agreements. (Worldcom
Bankruptcy News, Issue No. 19; Bankruptcy Creditors' Service,
Inc., 609/392-0900)
DebtTraders reports that Worldcom Inc.'s 7.750% bonds due 2007
(WCOE07USR1) are trading at about 23 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=WCOE07USR1
for real-time bond pricing.
WORLDPORT COMMS: W.C.I. Acquisition Further Extends Tender Offer
----------------------------------------------------------------
W.C.I. Acquisition Corp., has extended the expiration date of
its offer to purchase any and all of the outstanding shares of
common stock of WorldPort Communications, Inc., at a price of
$0.50 per share. W.C.I.'s offer was scheduled to expire at 5:00
p.m., New York City Time, on Friday, February 7, 2003. W.C.I.
has extended its offer so that it will now expire at 5:00 p.m.,
New York City Time, on Friday, February 14, 2003, unless
otherwise extended.
On February 7, 2003, as of 5:00 p.m., New York City Time,
6,979,642 shares of WorldPort common stock had been validly
tendered and not withdrawn pursuant to the Offer.
W.C.I. continues to believe that its offer is fair to the
WorldPort Communications stockholders. Among the factors
considered by W.C.I. in forming such belief is the consideration
of WorldPort's contingent liabilities. Based on WorldPort's Form
10-Q for the quarter ended September 30, 2002, WorldPort's total
stockholders' equity was approximately $88.8 million. Reducing
this amount by the $67.6 million liquidation preference of
WorldPort's outstanding preferred stock would yield a book value
of approximately $0.54 per share of outstanding WorldPort common
stock. The assets reflected in this calculation include $57.6
million in cash (approximately $1.47 per share of common stock)
which is a result of an income tax refund received By WorldPort
in April 2002. The return which produced this refund is still
subject to audit by the Internal Revenue Service. Upon audit,
the Internal Revenue Service could determine to require
adjustments and a return of some portion or all of this refund.
If WorldPort's assets were distributed to stockholders, the
stockholders would be subject to claims for the amount of any
refund required to be returned to the IRS, up to the amount of
any proceeds received in the distribution. Consequently,
distribution of WorldPort's assets to stockholders prior to the
review of the refund by the IRS or the expiration of the statute
of limitations for WorldPort's 2001 income tax return would
result in significant risk for WorldPort's stockholders.
In addition, as a result of a lack of an operating business and
its large number of stockholders, WorldPort must maintain its
liquid assets in government securities or comply with the
Investment Company Act of 1940. To the extent the income from
WorldPort's investments is less than WorldPort's expenses, the
assets of WorldPort will decline.
W.C.I.'s offer to purchase is conditioned upon there having been
validly tendered a sufficient number of shares of WorldPort
common stock such that, after the purchase of shares pursuant to
the offer, W.C.I. would own 90% of the outstanding WorldPort
common stock, and other conditions. In no event will W.C.I.
purchase shares tendered in the offer if less than a majority of
the outstanding shares, excluding shares owned by W.C.I. and its
stockholders, are validly tendered and not withdrawn. This
condition was not satisfied as of February 7, 2003.
If the offer is not completed because a condition is not
satisfied or waived, W.C.I. expects that WorldPort's management
will continue to operate WorldPort substantially as presently
operated and will defer any distributions with respect to its
outstanding common stock until its contingent liabilities are
further resolved. .In that event, W.C.I. and/or its stockholders
may consider other strategies with respect to WorldPort.
Questions and requests for assistance with respect to the offer
to purchase for the WorldPort shares may be directed to the
Information Agent for the transaction, Georgeson Shareholder
Services, at (212) 440-9800 (for banks and brokers), or, for all
others, toll free at (866) 328-5441.
* * *
As reported in Troubled Company Reporter's November 14, 2002
edition, the Company said it was "currently operating with a
minimal headquarters staff while we complete the activities
related to exiting our prior businesses and determine how to use
our cash resources. We will have broad discretion in determining
how and when to use these cash resources. Alternatives being
considered include potential acquisitions, a recapitalization
which might provide liquidity to some or all shareholders, and a
full or partial liquidation. Upon any liquidation, dissolution
or winding up of the Company, the holders of our outstanding
preferred stock would be entitled to receive approximately $68
million prior to any distribution to the holders of our common
stock."
YUM! BRANDS: Fourth Quarter 2002 Results Show Marked Improvement
----------------------------------------------------------------
Yum! Brands, Inc., (NYSE:YUM) reported results for the fourth
quarter ended December 28, 2002.
Key points relative to fourth-quarter performance:
-- International revenues grew 11%, and international
ongoing operating profit increased 17%, both in U.S.
dollar terms.
-- The total number of traditional international
restaurants in operation at quarter end was 11,538, 6%
higher than in 2001.
-- Net multibrand restaurant additions were 130 in the U.S.
and 12 internationally, resulting in 1,975 worldwide
multibrand restaurants in operation at quarter end, an
increase of 30% versus 2001.
-- Yum! Brands franchise fees increased 6% to a record $272
million.
Reminder: As stated in prior communications, beginning with the
first quarter 2003, the company will provide reported EPS
guidance but will no longer report or provide guidance for
ongoing operating EPS.
David C. Novak, Chairman and CEO, said, "The best year any
business can have is when you beat your financial plan and set
the table for future growth. 2002 was that kind of year for Yum!
Brands. Our long-term commitment is to grow our annual EPS by at
least 10%. In 2002, we grew ongoing operating EPS by 19%. This
was driven by exceptionally strong growth in revenues of 12%
while maintaining our category-leading return on invested
capital of 18%.
"Even more important, we continued to strengthen our powerful
international growth engine, successfully acquired and
integrated the Long John Silver's and A&W All-American Food
brands to enable our multibranding strategy, and launched our
customer mania operations program around the world.
"These are the three building blocks that give us what we
believe to be an unprecedented growth opportunity in our
industry and make us anything but your ordinary restaurant
company. Based on the results we achieved and the progress we're
making, we believe that we will deliver at least 10% earnings
growth in 2003 and beyond."
In the fourth quarter and full year for Yum! Brands'
international business, continued expansion of our key
international brands -- KFC and Pizza Hut -- was the primary
driver of system sales, revenue and ongoing operating profit
growth. Improvement in company restaurant margin was also a key
factor in ongoing operating profit growth both for fourth
quarter and full year 2002.
Yum! Brands set a record with 1,051 systemwide international
traditional restaurant openings in 2002. These included 646 KFCs
and 382 Pizza Huts.
In 2003, the company expects international system sales to grow
7% prior to foreign currency conversion. Net growth of +5% to
+6% in traditional restaurants primarily from the KFC and Pizza
Hut brands is expected to be a key factor. The company expects
international operating profit to grow at a mid-teens rate for
the full year.
The acquisition of Long John Silver's and A&W contributed
significantly to growth in U.S. system sales and revenue for
both the fourth quarter and full year. The acquisition of these
two brands occurred during the second quarter of 2002. Excluding
this impact, system sales growth was +2% for the fourth quarter
and +4% for the full year. Revenues, excluding the acquisition
impact, increased 1% for the fourth quarter and 3% for the full
year.
In the fourth quarter, U.S. systemwide blended same-store sales
increased approximately 1%. Estimated U.S. blended same-store
sales growth for franchise restaurants was +1% to +2% for the
fourth quarter, slightly stronger than company results, which
declined 1%.
For the full year 2002, U.S. systemwide blended same-store sales
increased 4%. Estimated U.S. blended same-store sales growth for
franchise restaurants was +4% to +5% for the full year, while
company restaurant growth was +2%. For the full year 2002, Taco
Bell company same-store sales increased 7%, while KFC and Pizza
Hut company same-store sales were even with last year.
For the full year 2002, restaurant margin of 16% was a record
for the U.S. business. In the fourth quarter, U.S. restaurant
margin was negatively impacted by higher labor costs. The
acquisition of Long John Silver's and A&W negatively impacted
margins by 0.1 percentage points for the fourth quarter and 0.2
percentage points for the full year.
For the full year 2003, the company expects U.S. operating
profit to increase at a rate of 6% to 9%. The company expects
U.S. blended company same-store sales growth of approximately 2%
for the full year.
For the year, worldwide restaurant unit growth was driven by
record growth in new international restaurants from our global
brands -- KFC and Pizza Hut. Key growth drivers were the
company's four high-growth, high-investment international
markets -- China, Mexico, the U.K., and Korea -- and development
by our international franchisees. Versus the fourth-quarter
2001, net traditional restaurant growth was 41% in China, 11% in
Mexico, 9% in the U.K., and 8% in Korea.
One point not reflected, which primarily affects U.S. net
restaurant-growth statistics, is the impact of multibranding on
our U.S. restaurant system. Multibrand conversions, while
increasing the sales and points of distribution of the added
brand, result in no additional unit counts. Though no additional
unit counts are realized, these conversions, on average, drive
significant increases in same-store sales and result in
upgraded, new-image restaurants for the U.S. business.
Similarly, a newly opened multibrand unit, while increasing
sales and points of distribution of two brands, results in just
one additional unit count.
For the full year 2003, the company continues to expect net
growth in international restaurants of 5% to 6%. This will be a
major driver of the company's expected overall profit growth for
2003. No net change in U.S. restaurant counts is expected. This
forecast excludes changes in licensed unit locations, which are
expected to have no material impact on the company's overall
profit performance in 2003. License locations are typically non-
traditional sites, such as airports, that normally have lower
average unit volumes than traditional restaurant locations.
In the fourth quarter, net multibrand additions were 130 in the
U.S. and 12 for international. In the U.S., company and
franchise net additions were 89 and 41 respectively. About 50%
of the U.S. multibrand additions represented conversions of
existing single-brand restaurants, and 50% represented new-
restaurant openings.
Our multibranding program with KFC and Taco Bell partnering with
Long John Silver's or A&W continues to grow with 47 additions
completed during the quarter. Results continue to show strong
average unit-volume increases. Additionally, we opened 17 Long
John Silver's/A&W multibrand restaurants during the fourth
quarter.
For the full year 2002, franchise multibrand additions were over
40% of the U.S. total. Approximately 50% of the U.S. multibrand
additions represented conversions of existing single-brand
restaurants, and 50% represented new-store openings. In addition
to the 347 Yum! multibrand openings during the year, another 20
Long John Silver's/A&W Restaurants were opened during 2002 prior
to the acquisition of Yorkshire Global Restaurants, bringing the
total number of multibrand openings and conversions in the Yum!
family to 367 in 2002.
In 2003, Yum! Brands expects to add at least 400 company and
franchise multibrand restaurants. About 50% of these additions
are expected to be conversions of single-brand restaurants to
multibrands, and 50% are expected to be new multibrand
restaurants.
In the fourth quarter and for the full year, the acquisition of
Long John Silver's and A&W, net new-restaurant development, and
worldwide franchise same-store sales growth were key factors in
franchise-fee growth. The acquisition of Long John Silver's and
A&W contributed 2 percentage points of franchise-fee growth both
in the fourth quarter and for the full year.
In 2003, the company expects franchise fees to grow to at least
$910 million.
Cash generated for the full year 2002 included $125 million of
proceeds from employee stock-option exercises and $71 million of
after-tax refranchising proceeds.
For 2003, the company expects cash flow from ongoing operations
of over $1.0 billion, which more than funds capital expenditure
needs estimated at between $800 and $850 million. Additionally,
the company expects total cash generated to exceed $1.2 billion,
including proceeds from employee stock-option exercises and from
after-tax refranchising proceeds. The company expects return on
invested capital to remain in the top tier of large-scale
restaurant companies.
First-Quarter 2003 Outlook
The company expects to earn at least $0.38 in reported EPS. This
is equal to last year's performance, prior to a gain of $0.02
from unusual items.
Projected factors contributing to the company's EPS expectations
are . . .
-- International system-sales growth of 10%, or 7% prior to
foreign currency conversion. Revenue growth of 12%, or
8% prior to foreign exchange conversion. Year-over-year
net growth in international traditional restaurants of
+5% to +6% will be the primary driver.
-- Based on current foreign currency rates, the company
expects a benefit of $3 to $5 million from foreign
currency conversion on operating profit for the first
quarter. The Australian dollar, British pound sterling,
Canadian dollar, Chinese renminbi, Japanese yen, Korean
won, and Mexican peso are all important currencies in
the company's international business.
-- U.S. blended same-store sales for company restaurants,
down 2%. Revenue growth of 9% to 10%, primarily due to
the Long John Silver's and A&W acquisition.
-- Worldwide company restaurant margin is expected to be
down slightly from first quarter last year. An increase
in international restaurant margin is expected to be
offset by a decline in U.S. restaurant margin. This is
primarily due to the impact from the lower margins of
the Long John Silver's and A&W acquisition and U.S.
sales deleverage impact.
-- General and administrative expenses up 10% in U.S.
dollar terms versus last year, up 2% versus last year
excluding the Long John Silver's and A&W acquisition.
-- Interest expense up $9 to $10 million versus last year,
or down slightly versus last year excluding the Long
John Silver's and A&W acquisition.
-- Assumes no significant impact from refranchising gain or
loss.
-- Assumes no impact from unusual items.
-- An all-in tax rate of 34% to 35%, about equal with last
year.
Year-2003 Outlook
Yum! Brands expects to earn at least $2.00 on a reported EPS
basis. This is at least 10% growth versus last year's $1.82,
which is prior to unusual-item gains. No net unusual items
gain/(loss) are currently expected for the full year.
The company expects worldwide revenue growth of 7% to 8%
(including 2 percentage points from the favorable impact of the
Long John Silver's and A&W acquisition).
In greater detail, Yum! Brands forecasts for First Quarter 2003:
* International system-sales growth of at least 7% prior to
foreign exchange conversion. Foreign currency translation
impact is expected to add 1 percentage point to the
growth rate.
* U.S. portfolio blended same-store sales for company
restaurants, even with a year ago.
* Ongoing operating earnings roughly even with last year.
Ongoing operating EPS of $0.40, even with last year.
* Average shares outstanding should decline to a range of
304 to 306 million shares.
* A facility action charge of $0.02, even with last year.
* Reported EPS of $0.38.
The the Full-Year 2003, Yum Brands! is expecting:
* Ongoing operating EPS in a range of $2.07 to $2.09.
* Reported EPS in a range of $1.98 to $2.00.
* Worldwide revenue growth of 7% to 8%. This includes an
impact of +2 points from the Long John Silver's/A&W
acquisition.
* Worldwide system-sales growth of 7% to 8%. This includes
an impact of +2 points from the Long John Silver's/A&W
acquisition.
* U.S. blended same-store sales increase of +2%.
* Over 1,400 new restaurants to be opened worldwide
including 1,000 internationally.
* Over 400 multibranded restaurants added through
conversions of existing restaurants, replacements
(rebuild on site or relocate), and new-restaurant builds.
* Continued growth in franchise fees to reach over $900
million.
* An increase in restaurant margin of approximately 0.1
percentage points. Long John Silver's/A&W negatively
impact worldwide margin by 0.2 percentage points year
over year.
* General and administrative costs will increase
approximately $30 million. This is primarily due to the
Long John Silver's/A&W acquisition and an increase in
international G&A of approximately $5 to $10 million.
* Ongoing operating profit to increase 7% to 9%.
* Ongoing operating earnings to increase 8% to 10%.
* The ongoing effective tax rate to be 31% to 32%, about
even with 2002.
* Average shares outstanding to decline to a range of 304
to 308 million shares.
* Return on invested capital to remain strong at 18%,
continuing at the best levels in the restaurant category.
Capital expenditures are expected to be about $825
million.
Yum! Brands, Inc., based in Louisville, Kentucky, is the world's
largest restaurant company in terms of system units with nearly
33,000 restaurants in more than 100 countries and territories.
Four of the company's restaurant brands --KFC, Pizza Hut, Taco
Bell and Long John Silver's-- are the global leaders of the
chicken, pizza, Mexican-style food and quick-service seafood
categories respectively. Since 1919, A&W All-American Food has
been serving a signature frosty mug root beer float and all-
American pure-beef hamburgers and hot dogs, making it the
longest running quick-service franchise chain in America. Yum!
Brands is the worldwide leader in multibranding, which offers
consumers more choice and convenience at one restaurant location
from a combination of KFC, Taco Bell, Pizza Hut, A&W or Long
John Silver's brands. The company and its franchisees today
operate over 1,900 multibrand restaurants, generating nearly $2
billion in annual system sales. Outside the United States in
2002, the Yum! Brands' system opened about three new restaurants
each day of the year, making it one of the fastest growing
retailers in the world. In 2002, the company changed its name to
Yum! Brands, Inc., from Tricon Global Restaurants, Inc., to
reflect its expanding portfolio of brands and its ticker symbol
on the New York Stock Exchange.
As previously reported, Fitch Ratings assigned a BB+ rating to
Yum! Brands' $350 million Senior Notes, while Standard & Poor's
gave the same debt issue its BB rating. Meanwhile, S&P rates
the Company's $1.4 billion senior unsecured bank facility at BB.
At Sept. 7, 2002, Yum! Brands balance sheet showed $5.1 billion
in assets and $4.6 billion in total liabilities.
ZENITH INDUSTRIAL: Wants to Extend Plan Exclusivity Until June 7
----------------------------------------------------------------
Zenith Industrial Corporation and its debtor-affiliates ask the
U.S. Bankruptcy Court for the District of Delaware for more time
to file their plan and solicit acceptances of that plan from
their creditors -- without interference from other parties-in-
interest.
The Debtors submit that their chapter 11 case is complex,
requiring management to wind up a national operation with $118
million in revenue for the calendar year 2001, $125 million in
secured debt, a significant amount of unsecured debt and
litigate a complicated adversary proceeding.
The Debtor and its sister company, Aetna Industries Inc., and
Trianon Industries Corp., its parent, executed an asset purchase
agreement with AZ Automotive (a Questor portfolio company), to
purchase substantially all of the Debtors' assets for
$145,000,000.
The Debtor points out that it has made substantial progress in
conducting this case. In addition to consummating the Asset
Sale, the Debtor is currently working through the price
adjustment issues associated with the Asset Sale and defending
and litigating the Adversary Proceeding against the Former
Owners.
As a result of these many substantial and complicated tasks, to
date, the Debtor has not had an opportunity to fully negotiate a
consensual chapter 11 plan with the Debtor's lenders. Moreover,
the Debtor has not had the requisite time needed to fully
analyze the claims that may be fled in this case. Accordingly, a
brief extension of the Exclusive Periods is required to provide
the Debtor with the opportunity to better estimate the proceeds
available for distribution to creditors and to work through the
various issues that have to be resolved with its lenders in
anticipation of presenting a consensual chapter 11 plan.
Consequently, the Debtors want to maintain the exclusive right
to file a chapter 11 Plan through June 7, 2003 and the exclusive
right to solicit acceptances of that plan through August 6,
2003.
Zenith Industrial Corporation, a leading worldwide, full-service
Tier 1 supplier of highly engineered metal-formed components,
complex modules and mechanical assemblies for automotive OEMs
filed for chapter 11 protection on March 12, 2002 (Bankr. Del.
Case No. 02-10754). Joseph A. Malfitano, Esq., Edward J.
Kosmowski, Esq., Robert S. Brady, Esq. at Young Conaway Stargatt
& Taylor, LLP and Larry S. Nyhan, Esq., Matthew A. Clemente,
Esq., Paul J. Stanukinas, Esq. at Sidley Austin Brown & Wood
represent the Debtor. When the Company filed for protection
from its creditors, it listed estimated debts and assets of more
than $100 million.
* Meetings, Conferences and Seminars
------------------------------------
February 20-21, 2003
AMERICAN CONFERENCE INSTITUTE
Commercial Loans Workouts
Marriott East Side, New York
Contact: 1-888-224-2480 or 1-877-927-1563
http://www.americanconference.com
February 22-25, 2003
NORTON INSTITUTES ON BANKRUPTCY LAW
Litigation Institute I
Marriott Hotel, Park City, Utah
Contact: 1-770-535-7722 or
http://www.nortoninstitutes.org
February 25-26, 2003
EURO LEGAL
Run-Off and Commutations
Radisson Edwardian Hampshire Hotel, London UK
Contact: +44-20-7878-6897 or
http://www.www.euro-legal.co.uk
March 6-7, 2003
ALI-ABA
Corporate Mergers and Acquisitions
San Francisco
Contact: 1-800-CLE-NEWS or http://www.ali-aba.org
March 20-21, 2003
AMERICAN CONFERENCE INSTITUTE
Outsourcing In Financial Services
Marriott East Side, New York
Contact: 1-888-224-2480 or 1-877-927-1563
http://www.americanconference.com
March 27-30, 2003
NORTON INSTITUTES ON BANKRUPTCY LAW
Litigation Institute II
Flamingo Hilton, Las Vegas, Nevada
Contact: 1-770-535-7722
or http://www.nortoninstitutes.org
March 31 - April 01, 2003
RENAISSANCE AMERICAN MANAGEMENT, INC. & BEARD GROUP
Healthcare Transactions: Successful Strategies for
Mergers, Acquisitions, Divestitures and Restructurings
The Fairmont Hotel Chicago
Contact: 1-800-726-2524 or fax 903-592-5168
or ram@ballistic.com
April 10-11, 2003
AMERICAN CONFERENCE INSTITUTE
Predaotry Lending
The Westin Grand Bohemian, Florida
Contact: 1-888-224-2480 or 1-877-927-1563
http://www.americanconference.com
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
April 28-29, 2003
AMERICAN CONFERENCE INSTITUTE
Credit Derivatives
Waldorf Astoria, New York
Contact: 1-888-224-2480 or 1-877-927-1563
http://www.americanconference.com
May 1-3, 2003
ALI-ABA
Chapter 11 Business Organizations
New Orleans
Contact: 1-800-CLE-NEWS or http://www.ali-aba.org
May 8-10, 2003
ALI-ABA
Fundamentals of Bankruptcy Law
Seattle
Contact: 1-800-CLE-NEWS or http://www.ali-aba.org
June 19-20, 2003
RENAISSANCE AMERICAN MANAGEMENT, INC. & BEARD GROUP
Corporate Reorganizations: Successful Strategies for
Restructuring Troubled Companies
The Fairmont Hotel Chicago
Contact: 1-800-726-2524 or fax 903-592-5168
or ram@ballistic.com
June 26-29, 2003
NORTON INSTITUTES ON BANKRUPTCY LAW
Western Mountains, Advanced Bankruptcy Law
Jackson Lake Lodge, Jackson Hole, Wyoming
Contact: 1-770-535-7722
or http://www.nortoninstitutes.org
July 10-12, 2003
ALI-ABA
Partnerships, LLCs, and LLPs: Uniform Acts, Taxation,
Drafting, Securities, and Bankruptcy
Eldorado Hotel, Santa Fe, New Mexico
Contact: 1-800-CLE-NEWS or http://www.ali-aba.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.
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices
are obtained by TCR editors from a variety of outside sources
during the prior week we think are reliable. Those sources may
not, however, be complete or accurate. The Monday Bond Pricing
table is compiled on the Friday prior to publication. Prices
reported are not intended to reflect actual trades. Prices for
actual trades are probably different. Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy
or sell any security of any kind. It is likely that some entity
affiliated with a TCR editor holds some position in the issuers'
public debt and equity securities about which we report.
Each Tuesday edition of the TCR contains a list of companies
with insolvent balance sheets whose shares trade higher than $3
per share in public markets. At first glance, this list may
look like the definitive compilation of stocks that are ideal to
sell short. Don't be fooled. Assets, for example, reported at
historical cost net of depreciation may understate the true
value of a firm's assets. A company may establish reserves on
its balance sheet for liabilities that may never materialize.
The prices at which equity securities trade in public market are
determined by more than a balance sheet solvency test.
A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged. Send announcements to
conferences@bankrupt.com.
Bond pricing, appearing in each Thursday's edition of the TCR,
is provided by DebtTraders in New York. DebtTraders is a
specialist in global high yield securities, providing clients
unparalleled services in the identification, assessment, and
sourcing of attractive high yield debt investments. For more
information on institutional services, contact Scott Johnson at
1-212-247-5300. To view our research and find out about private
client accounts, contact Peter Fitzpatrick at 1-212-247-3800.
Real-time pricing available at http://www.debttraders.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, Donnabel C. Salcedo, Ronald P. Villavelez and Peter
A. Chapman, Editors.
Copyright 2003. All rights reserved. ISSN: 1520-9474.
This material is copyrighted and any commercial use, resale or
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re-mailing and photocopying) is strictly prohibited without
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contained herein is obtained from sources believed to be
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The TCR subscription rate is $675 for 6 months delivered via e-
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*** End of Transmission ***