/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/030912.mbx T R O U B L E D C O M P A N Y R E P O R T E R Friday, September 12, 2003, Vol. 7, No. 181 Headlines 3DO COMPANY: Sold Assets for $4.6 Million at August 14 Auction ADVANSTAR COMMS: Commences Private Placement of 10.75% Sr. Notes AGCO CORP: Ratings on Watch Negative Due to Planned Acquisition ALLIED HOLDINGS: Completes Amendment to Senior Secured Facility AMERICA WEST: Initiates Growth Plans for 2004 AMERICAN AIRLINES: Will Add Work to Tulsa Maintenance Base AMERICAN NATURAL ENERGY: Secures Convertible Debenture Financing AMERICAN PAD & PAPER: Appoints New Company Board of Directors AMERICAN PAD & PAPER: Adds Key Executives to Management Team AMSOUTH BANCORP: Fitch Upgrades Individual Rating to B from B/C ARMSTRONG: Liberty Wants Hearing on Pre-Confirmation Issues Set ARVINMERITOR: Names Vice Presidents of Continuous Improvement AVNET INC: Fitch Assigns BB Rating to Senior Unsecured Debt AVON PRODUCTS: Participating in Banc of America Conference BEAR STEARNS: Fitch Downgrades Class K & L Note Ratings to B/CCC BRIDGE INFORMATION: Plan Administrator Balks at 52 Setoff Claims BRIDGEPORT HLDGS: Case Summary & 30 Largest Unsecured Creditors CALYPTE BIOMEDICAL: Marr Tech. Discloses 21.4% Equity Stake CASELLA WASTE: Reports 2004 First Quarter Financial Results CASUAL MALE: Plan Confirmation Hearing Scheduled for Nov. 18 CONSECO FIN.: Court Confirms 6th Amended Joint Liquidation Plan CONSECO INC: Successfully Emerges from Chapter 11 Proceedings CONSECO INC: Court Sets Deemed Amounts for Class 8A Claims DANA CORP: Opens New Fuel Cell Support Centers in UK and Japan DANA CORP: Will Construct New Manufacturing Plant in Czech Rep. DIAMOND ENTERTAINMENT: Hires Pohl McNabola as New Accountants DIGITAL WORLD: Searching for Chartered Accountant Replacement DOW CORNING: Launches New Global Photonic Solutions Business ENRON CORP: Proposes Uniform Procedures for Avoidance Actions FEDERAL-MOGUL: Court Approves Avoidance Action Stipulation FLOW INTERNATIONAL: July 31 Balance Sheet Upside-Down by $1.3MM GMAC COMMERCIAL: Fitch Affirms 6 Low-B/Junk P-T Certs. Ratings HCA GENESIS: Signs-Up Lowenstein Sandler as Bankruptcy Counsel ICG COMMUNICATIONS: W.R. Huff Discloses 19.3% Equity Stake IMC GLOBAL: Will Participate in CSFB Conference on Wednesday IMMUNE RESPONSE: Receives $3.2MM via Class A Warrants Exercises IMPSAT FIBER: Kingdon Capital Discloses 7.54% Equity Stake INTERDENT INC: Court Confirms Prepackaged Plan of Reorganization JARDEN CORP: Acquires All Outstanding Shares of Lehigh Consumer LASERSIGHT INC: Case Summary & Largest Unsecured Creditors LEVI STRAUSS: Will Publish Third Quarter Results by Month-End LEVI STRAUSS: Corporate Credit Rating Dives Down 2 Notches to B LTV CORP: Move to Terminate & Replace Benefit Plans Draws Fire MAXXIM MEDICAL: Inks Pact to Sell Assets to Lightyear Capital MERA PHARMACEUTICALS: Red Ink Continued to Flow in Third Quarter MICRO WAREHOUSE: Ingram Micro Discloses $20 Million Exposure MIKOHN GAMING: Evaluating Options to Recapitalize Balance Sheet MIRANT CORP: MAGI Committee Asks Court to Set-Up Screening Wall MOODY'S CORP: Will Present at ThinkEquity Conference on Tuesday MWAM CBO: Fitch Cuts Class C-1, C-2 Notes & Preferred to BB-/B- NATIONAL STEEL: Asks Court to Clear ICWU Memorandum of Agreement NRG ENERGY: Seeks Open-Ended Lease Decision Period Extension NUCENTRIX BROADBAND: Case Summary & Largest Unsecured Creditors OREGON STEEL MILLS: S&P Assigns B Corporate Credit Rating ORGANOGENESIS: Emerges from Chapter 11 Bankruptcy Proceedings PETCO ANIMAL: Opens Newly Relocated Germantown, Tennessee Store PG&E: USGen Wants Open-Ended Lease Decision Period Extension PHILIP MORRIS: Says Engle Plaintiffs' Appeals Should be Nixed PHOENIX GROUP: Texas Court Confirms Plan of Reorganization PILLOWTEX CORP: Asks Court to Approve $1.7MM GGST Break-Up Fee PRIMEDEX HEALTH: Seeks Consent to Extend Defaulted Debentures PRIMUS TELECOMMS: Prices $110 Million Convertible Senior Notes ROWE INT'L: Wants Court Nod to Hire Miller Johnson as Counsel ROYAL & SUNALLIANCE: S&P Knocks BB+ Ratings Off CreditWatch ROYAL IMDEMNITY: S&P Lowers Ratings on Four Related CMBS Deals SAFETY-KLEEN: Resolves All Disputes with Zachry International SAMSONITE CORP: Second Quarter Net Loss Slides-Up to $15 Million SEMINIS INC: Proposed $250M Sr Sec. Credit Gets S&P's BB- Rating SK GLOBAL: Agrees to Remove Bank One Frozen Account to Wachovia SOLUTIA INC: Ala. District Court Approves Global PCB Settlement TECHNEST HOLDINGS: Liquidity Issues Raise Going Concern Doubt TENNECO AUTOMOTIVE: Appoints Kenneth R. Trammell as New CFO TOM BROWN: S&P Assigns Speculative Grade Credit & Debt Ratings TOP-FLITE GOLF: Callaway Golf Names Bob Penicka President/COO TWINLAB CORP: Gets Interim Nod for $35 Million DIP Financing UNITED AIRLINES: Inks Court-Approved Pact with SkyWest Airlines UNITED AIRLINES: HSBC Seeks Stay Relief to Access LA Const. Fund URSTADT BIDDLE: Reports Improved Third Quarter Financial Results URSTADT BIDDLE: Board of Directors Declares Quarterly Dividends US AIRWAYS GROUP: Oaktree Fund Discloses 3.9% Equity Stake VERITAS DGC: Commences Search For New Chief Executive Officer VERTIS INC: Appoints New East and West Group Presidents WESTPOINT STEVENS: Selling 22 European Dept. Store Concessions WILLIAMS COMPANIES: Enters Transactions to Sell Non-Core Assets WORLD AIRWAYS: Inks New $70 Million Contract with TM Travel WORLDCOM INC: Asks Court to Approve McLeod Settlement Agreement * Goodwin Procter LLP Announces New Partnership Elections * Moody's Publishes First Canadian Corporate Bond Default Study * BOOK REVIEW: Risk, Uncertainty and Profit ********* 3DO COMPANY: Sold Assets for $4.6 Million at August 14 Auction -------------------------------------------------------------- On May 28, 2003, The 3DO Company, a Delaware corporation, and The 3DO Company, a California corporation and wholly-owned subsidiary of the Company, filed voluntary petitions for relief under Chapter 11 of Title 11 of the United States Code in the United States Bankruptcy Court for the Northern District of California. The Chapter 11 cases are jointly administered by the Banrktupcy Court under case numbers 03-31580 DM11 and 03-31581 DM11. On August 14, 2003, an auction was held in the Bankruptcy Court to sell the Debtors' assets. The successful bidders at the auction agreed to purchase certain of the Debtors' assets groups for an aggregate purchase price of $4,585,000. The assets groups included "High Heat Baseball," "Army Men," "Might & Magic," "Street Racing Syndicate," "Jacked,", other backlist titles, and two different patent groups. The successful bidders at the auction included Namco Hometek Inc., JoWood Productions Software AG, Crave Entertainment, Inc., Microsoft Corp., Patent Purchase Manager LLC, Ubi Soft Entertainment, and William M. "Trip" Hawkins III. The Debtors and each successful bidder plan to complete the documentation of the purchase and sale of assets in accordance with the Bankrutpcy Court's Order Approving Sales Procedures, as amended, and to close the purchase and sale of such assets prior to the closing deadline under the applicable asset purchase agreement. ADVANSTAR COMMS: Commences Private Placement of 10.75% Sr. Notes ---------------------------------------------------------------- Advanstar Communications Inc., has launched a private placement of $50 million aggregate principal amount of 10.75% second priority senior secured notes due 2010. The notes will be secured by second priority liens on substantially all the collateral securing Advanstar's credit facility (other than the capital stock of certain of its subsidiaries and assets of its parent companies), which collateral also secures its second priority senior secured notes issued in August 2003. Advanstar plans to use the net proceeds from the private placement to repay all amounts borrowed under its revolving credit facility (approximately $12 million) and will invest the remaining proceeds, along with a $50 million equity contribution to be provided by DLJ Merchant Banking Partners III, L.P. and related funds on the closing date of the private placement, in short-term investments pending completion of Advanstar's acquisition of a portfolio of healthcare industry-specific magazines and related custom project services from subsidiaries of The Thomson Corporation (as announced on August 25, 2003). If the acquisition closes, Advanstar will use the remaining net proceeds of the private placement, proceeds of the $50 million equity contribution made on the closing date of the private placement, an additional $10 million equity contribution to be made on the closing date of the acquisition and revolver borrowings of approximately $40 million to finance the acquisition. The notes will be subject to mandatory redemption if the Thomson acquisition does not close by December 31, 2003. The second priority senior secured notes will not be registered under the Securities Act of 1933, as amended, or any state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and any applicable state securities laws. Advanstar Communications Inc. (S&P, B Corporate Credit Rating, Negative) is a worldwide business information company serving specialized markets with high quality information resources and integrated marketing solutions. Advanstar has 100 business magazines and directories, 77 tradeshows and conferences, numerous Web sites, and a wide range of direct marketing, database and reference products and services. Advanstar serves targeted market sectors in such industries as art, automotive, beauty, collaboration/e-learning, CRM/call center, digital media, entertainment/marketing, fashion & apparel, healthcare, manufacturing and processing, pharmaceutical, powersports, science, telecommunications and travel/hospitality. The Company has over 1,200 employees and currently operates from multiple offices in North America, Latin America, Europe and Asia. For more information, visit http://www.advanstar.com AGCO CORP: Ratings on Watch Negative Due to Planned Acquisition --------------------------------------------------------------- Standard & Poor's Ratings Services placed its ratings on AGCO Corp., including its 'BB+' corporate credit rating, on CreditWatch with negative implications. The action followed AGCO's announcement that is has agreed to acquire the business of Valtra Corp. a Finnish company owned by unrated Kone Corp. for a purchase price of ?600 million. AGCO, a global manufacturer of agricultural equipment based in Duluth, Georgia, has $850 million of rated debt. Valtra is a global tractor and off-road engine manufacturer with leading market positions in the Nordic region of Europe and Latin America and should broaden AGCO's position in key agricultural equipment markets. The company has commitments from banks sufficient to fund the acquisition, however, AGCO has stated that it intends to issue equity to maintain existing credit ratios, although amounts and timing of issuance have not been made final. Subject to regulatory approval, the acquisition is expected to close in about three to four months. "We will meet with management to discuss Valtra's business and operating performance and AGCO's financing plans before taking further rating action," said Standard & Poor's credit analyst Daniel Di Senso. ALLIED HOLDINGS: Completes Amendment to Senior Secured Facility --------------------------------------------------------------- Allied Holdings, Inc. successfully completed an amendment to its senior secured credit facility on September 4, 2003. Ableco Finance LLC and Wells Fargo Foothill, Inc., a wholly-owned subsidiary of Wells Fargo & Company, remain as agents of the credit facility. * * * As previously reported in Troubled Company Reporter, Standard & Poor's affirmed its 'B' corporate credit rating on automobile transporter Allied Holdings Inc., and at the same time, removed the ratings from CreditWatch. The action reflected Allied Holdings' announcement that it had refinanced an unrated $230 million revolving credit facility and $40 million in unrated subordinated debt. Allied Holdings, based in Decatur, Ga., is the largest North American motor carrier of new and used automobiles and light trucks. The company has about $370 million in debt and operating leases. AMERICA WEST: Initiates Growth Plans for 2004 --------------------------------------------- America West Airlines (NYSE: AWA) expects to grow the airline in 2004 and anticipates increasing its mainline capacity (available seat miles) by approximately 10 percent by the fourth quarter of 2004. "With our return to profitability in the second quarter and expectation for profitability in the third quarter, we are preparing to grow America West again," said W. Douglas Parker, chairman and chief executive officer. "Our recently announced nonstop transcontinental flights and service to Costa Rica are examples of expansion opportunities for America West's low-fare, high-quality service." The anticipated growth of America West's mainline system in 2004 will be accomplished through increased fleet utilization and additional aircraft. The airline currently has plans to receive two Airbus aircraft in the fourth quarter of 2004 and is exploring the most efficient means of additional fleet expansion. Founded in 1983 and proudly celebrating its 20-year anniversary in 2003, America West Airlines is the nation's second largest low- fare airline and the only carrier formed since deregulation to achieve major airline status. Today, America West serves 92 destinations in the U.S., Canada and Mexico. As reported in Troubled Company Reporter's July 30, 2003 edition, Standard & Poor's Ratings Services assigned its 'CCC' rating to America West Airlines Inc.'s $75 million 7.25% senior exchangeable notes due 2023, offered under Rule 144A with registration rights. The notes are guaranteed by America West Airlines' parent, America West Holdings Corp. (both rated B-/Negative/-). America West Holdings' major subsidiary is America West Airlines Inc., the eighth-largest airline in the U.S, with hubs located at Phoenix and Las Vegas. America West benefits from a low cost structure, among the lowest in the industry. However, it competes at Phoenix and Las Vegas against Southwest Airlines Co., the other major low-cost, low-fare, operator in the industry and financially the strongest. As a result, due to the competition from Southwest, as well as America West's reliance on lower-fare leisure travelers, its revenues per available seat mile also tend to be among the lowest in the industry. In addition, America West Holdings owns the Leisure Co., one of the nation's largest tour packagers. AMERICAN AIRLINES: Will Add Work to Tulsa Maintenance Base ---------------------------------------------------------- With the passage of Vision 2025, American Airlines will be able to add work to the airline's largest maintenance overhaul base. The company announced it will: -- repair the landing gear on its Boeing 737 aircraft in Tulsa; -- complete the installation of the large overhead bins in its Boeing MD80 fleet in Tulsa (American has 335 MD80s in its fleet of 771 aircraft); and -- add an MD80 heavy check line in November to replace the work lost with the retirement of the Fokker 100 fleet. (There are 57 F100s currently in the fleet.) "Bringing this new work to our local maintenance facility is our way of saying thanks to the people of Tulsa for their support," said Gerard Arpey, president and CEO of American Airlines. "This has been made possible in part thanks to the support of Oklahoma Governor Brad Henry, University of Oklahoma President David Boren, Congressman John Sullivan, Tulsa Mayor Bill LaFortune, and the other state and city leaders who care about the Tulsa community and its economic future. "We also appreciate the officers and members of Transport Workers Union (TWU) Local 514 and the officers of the TWU International and the AFL-CIO for generating overwhelming support for the proposition," he said. "This is an example of what can be accomplished when the community, employees, and our unions work together to solve problems," said Carmine Romano, vice president of American's Tulsa Maintenance Base. "We are proud that American and the TWU -- virtually alone among the major airlines and airline unions -- were able to maintain the heavy aircraft maintenance capability of this airline by avoiding bankruptcy, and that we are now in a position to expand it," said Randy McDonald, president of TWU Local 514. American has been evaluating its maintenance capacity requirements for several months. Today, the airline has maintenance overhaul bases in Kansas City, Mo.; Fort Worth, Texas; and Tulsa, Okla. The passage of this proposition is an important piece in its evaluation process. As the analysis is finalized, American is taking into account each community's support. The company expects to make an announcement about the full allocation of work among the three bases within weeks. Current AMR Corp. (NYSE: AMR) (S&P, B- Corporate Credit & CCC Senior Unsecured Convertible Debt Ratings, Negative) news releases can be accessed via the Internet. The address is http://www.amrcorp.com AMERICAN NATURAL ENERGY: Secures Convertible Debenture Financing ---------------------------------------------------------------- American Natural Energy Corporation (TSX Venture: ANR.U) has reached a preliminary financing agreement consisting of secured convertible debentures in a principal amount of US$9.5 million to US$12 million. The convertible debentures will be repayable on October 1, 2005 with interest payable quarterly at 8% per annum, in cash or shares of ANEC. The debentures will be convertible into common shares of ANEC at US$0.45 per share at any time after the date of issue and are non-callable for a period of one year. A commission will be payable on this financing. In connection with the completion of the financing, it is intended that two additional directors will be appointed to the board of directors of ANEC. ANEC will use proceeds of the financing for the repayment of debt and for future exploration and development of its Bayou Couba oil and gas leases within its ExxonMobil Joint Development Project in St. Charles Parish, Louisiana. Closing is scheduled for October 1, 2003 and is subject to all required regulatory approvals, final documentation and due diligence review. The debentures and any common shares issued upon conversion of the debentures will be subject to a statutory hold period of four months under applicable Canadian securities legislation and stock exchange policies. The securities intended to be offered are intended to be sold in a private transaction and will not be, when issued and sold, registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act. ANEC is a Tulsa, Oklahoma based independent exploration and production company with operations in St. Charles Parish, Louisiana. * * * Going Concern Uncertainty As reported in Troubled Company Reporter's August 29, 2003 edition, the Company announced its financial statements have been prepared on a going concern basis which contemplates continuity of operations, realization of assets and liquidation of liabilities in the ordinary course of business. The Company has no current borrowing capacity with any lender. It has sustained substantial losses in 2002 and 2001, totaling approximately $8.7 million and $1.0 million, respectively, a stockholders' deficit of $1.4 million at December 31, 2002, a working capital deficiency of approximately $6.0 million including current amounts due under borrowings of approximately $4.5 million, and negative cash flow from operations in each of 2002 and 2001, all of which lead to questions concerning the Company's ability to meet its obligations as they come due. The Company also has a need for substantial funds to develop its oil and gas properties. As a result of the losses incurred and current negative working capital and other matters described above, there is no assurance that the carrying amounts of its assets will be realized or that liabilities will be liquidated or settled for the amounts recorded. The Company's ability to continue as a going concern is dependent upon adequate sources of capital and the ability to sustain positive results of operations and cash flows sufficient to continue to explore for and develop its oil and gas reserves. The independent accountants' report on American Natural Energy's financial statements as of and for the year ended December 31, 2002 includes an explanatory paragraph which states that the Company has sustained substantial losses, a stockholders' deficit, a working capital deficiency and negative cash flow from operations in each of 2002 and 2001 that raise substantial doubt about its ability to continue as a going concern. AMERICAN PAD & PAPER: Appoints New Company Board of Directors ------------------------------------------------------------- American Pad & Paper LLC, after successfully emerging from bankruptcy on August 26, 2003, has formed a new board of directors to provide guidance and oversight to the Company going forward. The five-member board is comprised of exceptionally qualified business executives who played key roles in the Company's acquisition out of bankruptcy by an affiliate of Crescent Capital Investments, Inc. Serving on the board are four non-management directors: David Crosland, Charles Ogburn and Edward Underwood of Crescent Capital Investments, Inc., and Gerald Benjamin of Casas, Benjamin & White, LLC. John Bermingham, Ampad's new President and CEO, is the fifth member of the board and will hold the position of Chairman. About the Directors David Crosland is an Executive Director of Crescent Capital. Prior to joining Crescent, David worked for Investcorp where he was responsible for all aspects of acquisitions and divestitures including originating, analyzing, structuring, and negotiating transactions as well as monitoring acquired companies. Prior to Investcorp, Mr. Crosland spent three years with Morgan Stanley, where he worked in the firm's mergers and acquisitions group. Mr. Crosland holds a BA in Economics, magna cum laude, from Duke University and an MBA from Harvard Business School. Charles Ogburn is an Executive Director of Crescent Capital. Prior to joining Crescent, Charlie spent more than 15 years at the investment banking firm of Robinson-Humphrey, most recently as Senior Managing Director and co-head of investment banking. Prior to Robinson-Humphrey, Mr. Ogburn was an attorney with the law firm of King & Spalding for five years. Mr. Ogburn is a graduate of Duke University and earned his law degree from Vanderbilt University School of Law. He is a Director of the Atlanta Venture Forum and a Trustee of Trinity School. Edward Underwood is an Executive Director of Crescent, responsible for post-acquisition reporting for Crescent's portfolio companies. Prior to joining Crescent, Mr. Underwood served as Chief Financial Officer for Burnham Service Company, a $200 million revenue trucking and logistics company. Prior to Burnham, he spent nine years with Investcorp, most recently as part of the Post- Acquisition Management team where he was responsible for monitoring the operations and performance of acquired companies. Mr. Underwood has a BS in Industrial Engineering from the Georgia Institute of Technology and an MBA from Cornell University. Gerald Benjamin is Managing Director of Casas, Benjamin & White, LLC where he directs the firm's Distressed Mergers and Acquisitions Group, as well as coordinates the firm's equity placement and mergers and acquisitions advisory services. Prior to joining Casas, Benjamin & White, LLC, Mr. Benjamin was a co- founder and served as CEO of Bock, Benjamin & Co., an Atlanta- based boutique mergers and acquisitions advisory firm. Mr. Benjamin also served as CEO of Premier HealthCare, Inc., and has served as a principal with companies in the healthcare, financial services, specialty retailing, distribution, and manufacturing industries and currently serves as a director of Global Link Logistics, Inc., OfficeImages, Inc., Club Staffing, Inc., National Dental Services, Inc., and Spec-Line Laminated Products, Inc. Mr. Benjamin, a Certified Public Accountant, received his Bachelor of Science degree in Accounting from the University of Kentucky, where he was named a Coopers & Lybrand Scholar. John Bermingham was named as President and CEO of American Pad & Paper LLC when it emerged from bankruptcy and will serve as the Chairman of its new board. Prior to joining the Company, Mr. Bermingham served as Chairman, President and CEO of Centis, Inc., a diverse manufacturing and distributing company serving the office products and related industries. Among his other career accomplishments, Mr. Bermingham served as President and CEO of Smith Corona Corporation, President and CEO of Rolodex Corporation, and President and CEO of AT&T Smart Cards Systems & Solutions. Mr. Bermingham earned a BA from Saint Leo University and has completed the Harvard University Graduate School of Business Advanced Management Program. Ampad is a leading manufacturer and distributor of writing pads, filing supplies, retail envelopes and specialty papers and serves many of the largest and fastest growing office products retailers and distributors in North America. Additional information on Ampad can be found at http://www.ampad.com AMERICAN PAD & PAPER: Adds Key Executives to Management Team ------------------------------------------------------------ American Pad & Paper LLC has added key executives to its management team as one of the first steps in implementing its strategic growth plan. Each has significant, successful industry experience that will be applied to strengthening current revenue, creating new opportunities for sales and supporting Ampad's long- term growth. "Ampad has a strong market presence and has been recognized by our customers for outstanding service," stated John Bermingham, who became Ampad's Chairman, President and CEO upon its recent exit from bankruptcy. "We are going to build on that foundation by investing in our business, further developing our sales channels and broadening our product offerings. These individuals have the expertise and leadership ability to accomplish those objectives." In addition to Mr. Bermingham, the following people have joined the Ampad management staff: Waite Popejoy, Executive Vice President, Chief Financial Officer; Frank Clementi, Vice President, Sales; Michael Kinnick, Vice President, Product Marketing; and Cheryl Griffith, Director of Sales - Special Markets. Each joins Ampad from Centis, a diverse manufacturing and distributing company serving the office products and related industries, where they individually and collectively demonstrated the ability to deliver on aggressive performance goals. About the Executives John Bermingham was named as President and CEO of American Pad & Paper LLC when it emerged from bankruptcy and will serve as the Chairman of its new board. Prior to joining the Company, Mr. Bermingham served as Chairman, President and CEO of Centis, Inc. Among his other career accomplishments, Mr. Bermingham served as President and CEO of Smith Corona Corporation, President and CEO of Rolodex Corporation, and President and CEO of AT&T Smart Cards Systems & Solutions. Waite Popejoy, Executive Vice President and Chief Financial Officer, has over 20 years of accounting, finance and management experience, most recently as the Chief Financial Officer for Centis. He started his professional career as a CPA with Mauldin & Jenkins, the largest local accounting firm in Georgia. Afterward, he entered the private sector and held a number of progressively responsible roles at Charter Behavioral Health Services LLC/Magellan Health Services, Inc. Mr. Popejoy then served as Senior Vice President and Chief Financial Officer for Physicians' Specialty Corporation and as a consultant before joining Centis. Frank Clementi, Vice President, Sales, served as Vice President, Sales for Centis for over 10 years prior to joining Ampad. During that time he built and had responsibility for a sales organization that generated annually increasing sales results. Prior to Centis, Mr. Clementi was National Sales Manager for Kleer-Fax Index Manufacturing for seven years and, for 14 years, had his own office products sales and marketing group that represented eight key manufacturers in a five-state region. Michael Kinnick, Vice President, Marketing, brings over 30 years of marketing and a successful track record of new product and new market development. Before joining Ampad, he served as Vice President, Marketing for Centis; Director of Marketing for Sentry Group; Director of Marketing for Keith Clark ("At-A-Glancer"); and Marketing Manager of Sheaffer-Eaton Textran. Cheryl Griffith, Director of Sales - Special Markets, most recently was Director of Sales in Centis' Commercial Products Division where she managed dealers, buying groups and wholesalers in a broad range of special market channels. Her previous experience includes serving as Vice President, Sales for Successories, Inc.; National Accounts Manager for Polaroid Corporation; Sales Director for Acco USA; and Product Manager- Division Marketing Department for Boise Cascade Office Products. Ampad is a leading manufacturer and distributor of writing pads, filing supplies, retail envelopes and specialty papers and serves many of the largest and fastest growing office products retailers and distributors in North America. Additional information on Ampad can be found at http://www.ampad.com AMSOUTH BANCORP: Fitch Upgrades Individual Rating to B from B/C --------------------------------------------------------------- Fitch Ratings upgraded the Individual Rating for AmSouth Bancorporation and AmSouth Bank to 'B' from 'B/C.' All other ratings are affirmed at this time. The rating change highlights ASO's sound financial performance that has continued throughout the recent trough in the business cycle. While ASO has not been immune to deterioration in its net interest margin, it has been able to realize significant gains in noninterest income and improve operating efficiency to combat the decline. Trends in asset quality also have improved and appear ready to return to historical norms. Notwithstanding, ASO has been very opportunistic in growing its home equity loan portfolio, which has come to represent in excess of 20% of total loans over the past couple of years. While underwriting standards (average FICO scores and loan-to-value ratios) appear reasonable, it remains to be seen what the effect of still rising personal bankruptcy rates and lower corporate payrolls will have on the low loss rates these products have historically exhibited. Even so, Fitch views ASO as aptly positioned to absorb potential problems should they occur. Ratings Upgraded AmSouth Bancorporation and AmSouth Bank -- Individual, to 'B' from 'B/C.' Ratings Affirmed AmSouth Bancorporation -- Long-term debt, 'A-'; -- Short-term debt, 'F1'; -- Subordinated debt, 'BBB+'; -- Support, '5'. AmSouth Bank -- Long-term deposits, 'A'; -- Short-term deposits, 'F1'; -- Long-term debt, 'A-'; -- Short-term debt, 'F1'; -- Subordinated debt, 'BBB+'; -- Support, '4'. ARMSTRONG: Liberty Wants Hearing on Pre-Confirmation Issues Set --------------------------------------------------------------- Liberty Mutual Insurance Company asks Judge Newsome to order a case management schedule and hearing schedule. In connection with the Armstrong Holdings Debtors' Fourth Amended Plan of Reorganization, Liberty Mutual served a set of interrogatories and requests for document production on the Debtors, the Legal Representative for Future Claimants, the Official Committee of Asbestos Claimants, and the Official Unsecured Creditors' Committee. Anticipating objections to these discovery requests, Charlene D. Davis, Esq., at The Bayard Firm, in Wilmington, Delaware, sent a proposed scheduling order for pre-trial procedures by letter to counsel for the served parties. Ten days later, Liberty's counsel again asked the parties' counsel for agreement on a scheduling order. A week later, the Debtors' counsel advised Liberty Mutual that "the Debtors had no interest in a scheduling order." The other parties never responded at all. Ms. Davis reminds Judge Newsome that the confirmation hearing is presently scheduled for November 17, 2003, with objections to confirmation due as early as September 22, 2003. Judge Newsome has stated during various hearings that he intends to go forward with the confirmation hearing on the November date and that no continuance of the confirmation hearing will be granted. Given these time constraints, Liberty Mutual suggests that the matter be governed in an orderly way by a scheduling order. Debtors Object Rebecca L. Booth, Esq., at Richards Layton & Finger, in Wilmington, Delaware, recounts that, following the filing of the original Plan in December 2002, Liberty Mutual "engaged in months of public negotiations" with AWI over the content of the plan and disclosure statement. She reminds Judge Newsome that Liberty Mutual filed an objection to the Disclosure Statement, which was eventually overruled. Every time AWI revised its Disclosure Statement in response to an objection by Liberty Mutual, the insurance company appeared with more modifications. Eventually, "AWI made wholesale revisions to its plan to accommodate concerns raised by Liberty Mutual over proposed findings AWI was seeking in the confirmation order . . . AWI deleted nearly all of those findings and clarified in the approved disclosure statement that "pursuant to the Plan, AWI does not seek to modify the right of AWI, Reorganized AWI, the Asbestos PI Trust or Liberty Mutual to assert claims (including counterclaims) and defenses in any appropriate forum." In its order approving the Debtors' disclosure statement, the Court set deadlines by which objections to confirmation, and responses to those objections, must be filed. AWI has completed its distribution of solicitation materials -- and now here comes Liberty Mutual's discovery requests. As expected, AWI objects to the discovery requests because discovery is not being sought in connection with a pending adversary proceeding or contested matter. Moreover, at nearly every hearing, AWI raised with the Court its proposed schedule regarding confirmation of the plan, including deadlines for filing objections to confirmation and responses. On June 2, 2003, the Court entered an order approving the Disclosure Statement as containing adequate information. That Order contains a schedule for the hearing to confirm the Plan, including these key dates: (i) September 22, 2003 -- deadline by which objections to confirmation of the Plan must be made and the deadline by which parties who are entitled to vote on the Plan must submit their ballots; (ii) October 24, 2003 -- deadline by which AWI, the DIP Lenders, the Prepetition Lenders, and the Committees, may serve replies to objections to confirmation of the Plan; (iii) November 17, 2003 -- commencement of the Confirmation Hearing. The Discovery Requests Liberty Mutual's Discovery Requests include requests for, inter alia, "all documents written by, prepared by, sent to, examined or reviewed by, any witness that [AWI] intends to call at the Confirmation Hearing, or in connection with any other proceeding before the Court, to testify as to matters pertaining or relating to the Asbestos PI Trust, the Asbestos PI Trust Agreement, the estimated value of Asbestos Personal Injury Claims, and the Asbestos PI Insurance Asset." AWI has objected to these requests on various grounds, including that no authority exists by which Liberty Mutual may make such discovery because the discovery is not being sought in connection with a pending adversary proceeding or even a contested matter. Liberty Mutual now wants to "embark on a fishing expedition and conduct wholesale discovery of AWI and the Committees before filing an objection to confirmation." AWI strenuously objects to any attempt by Liberty Mutual to "gain treatment for itself that is not authorized by the Court or the Federal Rules of Bankruptcy Procedure and that other parties in interest -- some with more of an interest in the confirmation hearing than Liberty Mutual -- also do not have." Predicting What Might Happen Notwithstanding Liberty Mutual's active participation in the months of hearings, discussions, and revisions to the Disclosure Statement that led up to the Court's approval of the Disclosure Statement as containing adequate information, Liberty Mutual now believes that it needs broad ranging discovery prior to filing any objection to confirmation. This includes what executory contracts are required to be assumed under the Plan and whether AWI has the ability, as a matter of applicable law, to assign rights under the Liberty Mutual policies without Liberty Mutual's consent. Neither of these issues requires discovery, but, instead, both can be argued as a legal matter, and AWI expects that Liberty Mutual will brief these issues in its Plan confirmation objection; whereupon AWI will file a response to such issues within the Court-ordered schedule. Other than these issues, it is by no means clear what grounds Liberty Mutual will assert as objection to confirmation. There Is No Contested Matter to Shape Discovery What the requirement of an objection or adversary proceeding as a prerequisite to discovery does is enable the parties to frame the issues and embark on appropriate discovery relevant to the disputed issues between such parties. Particularly in the context of confirmation of a plan, many potential areas of dispute exist, some of which may never be addressed because a party does not file an objection to confirmation, a party votes in favor of a plan, or a class votes to accept a plan. Only knowing what the actual disputes are with Liberty Mutual will enable AWI and the Committees to determine, as to each discovery request, whether the request is relevant or overbroad or even whether Liberty Mutual has standing to make a particular objection to confirmation. Of course, while Liberty Mutual has until September 22, 2003, to file an objection to confirmation and could supplement any earlier filed objection within the time allowed by the Disclosure Statement Order; nothing prevents Liberty Mutual from filing an objection to confirmation now and then engaging in discovery relating to the objections appropriately made by Liberty Mutual. AWI reserves the right to argue that Liberty Mutual lacks standing to object to those aspects of the Plan that relate to resolution of its asbestos-related liabilities and other non-insurance matters. In addition, AWI believes that the Court should require Liberty Mutual to disclose the substance of the evidence on which it plans to rely at the Confirmation Hearing in support of its objections before AWI is required to make disclosures of the same. This is because AWI anticipates that most, if not all, of its evidence will be submitted for the purpose of responding to Liberty Mutual's objections and evidence. Frame the Issues -- Then Schedule AWI has no objection per se to the entry of a scheduling order to supplement the schedule already approved by the Court in the Disclosure Statement Order, but such scheduling order must require as a first step that Liberty Mutual frame the issues in dispute by filing an objection to confirmation and disclosing the evidence on which it plans to rely in support of that objection, and that all other time periods for discovery run from the time when Liberty completes those essential first steps. Hypothetical Disputes Requiring that any discovery follow the filing of an objection also ensures that AWI is not subject to other, potentially conflicting and burdensome, requests by other parties seeking to embark on their own fishing expeditions to obtain information that may or may not be relevant to disputed confirmation issues. AWI and the Committees have enough real work to do prior to confirmation without AWI's estate having to pay for the expense of accommodating discovery requests relating to hypothetical disputes with parties on classes under the Plan. The hypothetical nature of potential confirmation disputes also highlights another problem with Liberty Mutual's request. Liberty Mutual wants AWI to make commitments now regarding what evidence AWI will, or will not, present in connection with confirmation. Although AWI has been forthcoming with Liberty Mutual in this respect, AWI cannot tie its hands at this stage and commit to the precise path that the Confirmation Hearing will take. Timetable Adopted by the Court Provides Substantial Time for Discovery At AWI's request, the Court adopted a fairly long timetable prior to the scheduled November 17, 2003 Confirmation Hearing. Even if Liberty Mutual or another party waits until the September 22, 2003 deadline for objecting to confirmation to file its objection and seek discovery in connection with such objection, that party will still have almost 60 days before the commencement of the confirmation hearing to complete discovery with respect to any disputed issues. The confirmation schedule approved by the Court and set forth in the Disclosure Statement Order provides more than sufficient time to address most disputes that can arise in connection with confirmation of the Plan. Creditors' Committee, Asbestos Claimants' Committee and Futures Representative Also Object The Discovery Requests have been propounded by Liberty Mutual on AWI as well as the Official Committee of Unsecured Creditors, the Official Committee of Asbestos Claimants, and Dean M. Trafelet, as the legal representative for AWI's future asbestos personal injury claimants. The Committees have each reviewed AWI's Objection and have indicated to Ms. Booth that they support the Debtors' points and arguments. (Armstrong Bankruptcy News, Issue No. 46; Bankruptcy Creditors' Service, Inc., 609/392-0900) ARVINMERITOR: Names Vice Presidents of Continuous Improvement ------------------------------------------------------------- ArvinMeritor Inc. (NYSE: ARM) announced two vice president appointments in its Continuous Improvement and Quality organization. Joseph Muscedere has been appointed vice president of Quality for Commercial Vehicle Systems (CVS), including its Commercial Vehicle Aftermarket (CVA) business. Sean Wright has been named vice president of Continuous Improvement. Both will report to Debra Shumar, senior vice president of Continuous Improvement and Quality. Muscedere has 17 years of experience with the company and has held leadership positions in quality and operations. He most recently served as senior director, Quality, CVS and CVA. Muscedere holds a bachelor's degree in mathematics from the University of Western Ontario. He resides in Troy, Mich. Wright joined the company in 1999 and most recently served as senior director, Continuous Improvement. Prior to joining ArvinMeritor, he was director, Lean Process Center, for Lockheed Martin. He holds a bachelor's degree in industrial technology from California State University, Long Beach. Wright resides in West Bloomfield, Mich. ArvinMeritor, Inc. (S&P, BB+ Corporate Credit & Senior Unsecured Debt Ratings, Negative) is a premier $7-billion global supplier of a broad range of integrated systems, modules and components to the motor vehicle industry. The company serves light vehicle, commercial truck, trailer and specialty original equipment manufacturers and related aftermarkets. In addition, ArvinMeritor is a leader in coil coating applications. The company is headquartered in Troy, Mich., and employs 32,000 people at more than 150 manufacturing facilities in 27 countries. ArvinMeritor common stock is traded on the New York Stock Exchange under the ticker symbol ARM. For more information, visit the company's Web site at: http://www.arvinmeritor.com AVNET INC: Fitch Assigns BB Rating to Senior Unsecured Debt ----------------------------------------------------------- Fitch Ratings has initiated coverage of Avnet, Inc., and assigned a 'BB' rating to the company's senior unsecured debt. The Rating Outlook is Stable. Approximately $1.4 billion in debt securities are outstanding. The ratings reflect concerns regarding Avnet's strained credit protection measures, high debt levels, lower but improved capacity utilization levels along with the pricing pressures and demand variability and lower growth characteristics of the technology distribution industry. Also embedded into the ratings is reduced liquidity from the company's decision to cancel its bank facility due to the effects of rating triggers. Positively, Fitch recognizes the company's stabilizing revenue stream, adequate liquidity, and leading industry position. Profitability expansion is possible from on-going cost cutting initiatives and the anticipated growth for semiconductors. The stable outlook reflects Avnet's stabilizing revenue base and cash flows in an improving but still challenging demand environment. Avnet has flexibility within the current rating for moderate operational and industry shortfalls, even though minimal sequential quarterly revenue improvement is expected. The company's operations have been negatively affected the last few years by the economic downturn and the cyclical declines of the semiconductor industry and overall information technology (IT) market. Total revenue in fiscal year 2003 ending June 27, 2003 was $9.0 billion, versus $8.9 billion in 2002 and $12.8 billion in 2001. Revenue levels have been stable for the past eight quarters in the $2.1-$2.3 billion range but with EBITDA margins at historically low levels of approximately 2.5%. Fitch believes the demand environment for IT, especially for Europe, remains uncertain but a moderate industry recovery is expected, especially for semiconductors. As a result, Avnet's credit protection metrics have weakened substantially since fiscal year 2001 driven by lower profitability. Fitch estimates interest coverage (measured by EBITDA/interest incurred) was slightly more than 2 times as of June 30, 2003 which has improved moderately the last few quarters. Positively, the company's interest coverage could improve further in the next few quarters as a result of the company entering into interest rate swaps which should reduce annual interest expense by approximately $7 million starting in the December quarter. In February 2003 Avnet completed the sale of $475 million 9.75% senior notes due February 2008. Proceeds from the debt offering were used to redeem approximately $380 million of senior notes due August 2003 and October 2003. As a result, total debt has remained consistent at the $1.45 billion level for the last few quarters, compared to $1.6 billion at fiscal year 2002 and $2.2 billion in 2001. As of fiscal year 2003 leverage (measured by total debt/EBITDA) was more than 7 times, an improvement from 9x in fiscal year 2002. EBITDA has been stabilizing and should improve moderately the next few quarters as the company begins to see the benefits of its cost cutting initiatives. Fitch anticipates the company may choose to implement additional cost cutting measures as it continues to rationalize expenses. As a result, Fitch expects leverage to improve to approximately 5x by the end of fiscal 2004. Fitch still believes Avnet's liquidity is adequate although reduced and is supported by nearly $400 million in cash and equivalents (approximately $320 million is unrestricted) as of June 27, 2003, and a $350 million undrawn accounts receivable securitization program. The company also recently filed a $1.5 billion universal shelf registration and cancelled its undrawn $350 million three-year revolving credit facility due to a potential rating trigger of a springing lien provision where the banks would have become secured, subordinating the senior unsecured bondholders. The company's current resources are sufficient to meet its near-term debt obligations with $100 million due in February 2004. However, Fitch believes it is likely that company will have to access the capital markets in the intermediate term with debt maturities of $360 million in February 2005 and $400 million in November 2006. This rating is based on existing public information and is provided as a service to investors. AVON PRODUCTS: Participating in Banc of America Conference ---------------------------------------------------------- Avon Products, Inc. (NYSE: AVP) president and chief operating officer, Susan J. Kropf, will participate in the Banc of America Securities 33rd Annual Investment Conference in San Francisco on Tuesday, September 16, 2003. The Banc of America conference features a unique question and answer exchange following brief opening remarks by Ms. Kropf. Banc of America will webcast both the presentation and the breakout session live beginning at approximately 11:30 a.m. New York time. Those wishing to access the webcast can obtain instructions for doing so from the Avon Investor website, http://www.avoninvestor.com The webcast will be archived at that site for two weeks. Avon -- whose March 31, 2003 balance sheet shows a total shareholders' equity deficit of about $113 million -- is the world's leading direct seller of beauty and related products, with $6.2 billion in annual revenues. Avon markets to women in 143 countries through 3.9 million independent sales Representatives. Avon product lines include such recognizable brands as Avon Color, Anew, Skin-So-Soft, Advance Techniques Hair Care, beComing, and Avon Wellness. Avon also markets anextensive line of fashion jewelry and apparel. More information about Avon and its products can be found on the company's Web site http://www.avon.com BEAR STEARNS: Fitch Downgrades Class K & L Note Ratings to B/CCC ---------------------------------------------------------------- Bear Stearns Commercial Mortgage Securities commercial mortgage pass-through certificates, series 1999-WF2 are downgraded by Fitch Ratings as follows: -- $10.8 million class K to 'B- 'from 'B'. -- $4.1 million class L to 'CCC' from 'B-'. The following classes are affirmed by Fitch: -- $256.4 million class A-1 'AAA'. -- $525.8 million class A-2 'AAA'. -- Interest only class X 'AAA'. -- $43.2 million class B 'AA'. -- $43.2 million class C 'A'. -- $10.8 million class D 'A-'. -- $27.0 million class E 'BBB'. -- $10.8 million class F 'BBB-'. -- $21.6 million class G 'BB+', -- $16.2 million class H 'BB' -- $8.1 million class I 'BB-'. -- $9.5 million class J 'B+'. -- $10.8 million class K 'B'. -- $4.1 million class L 'B-'. Fitch does not rate the $10.8 million class M. The ratings actions follow Fitch's annual review of this transaction, which closed in July 1999. The downgrades are primarily due to the expected losses on the specially serviced loans, which will cause a reduction in credit enhancement levels. As of the August 2003 distribution date, the pool's aggregate balance has been reduced by 8%, to $998.3 million from $1.08 billion at issuance. Wells Fargo, the master servicer, provided year-end 2002 operating statements for 89% of the pool's outstanding balance. The YE 2002 weighted average debt service coverage ratio for the pool is 2.01 times, compared to 1.83x at issuance. Of concern in the transaction are six loans (3.2%) in special servicing. There are two real estate owned loans (0.81%), both retail properties, one located in Baytown, TX, and the other located in Houma, LA. Both loans are expected to be sold for a loss. The largest loan (0.97%) in special servicing is a $9.7 million dollar retail center in Waterford Township, MI. The loan is 90 days delinquent and the current occupancy at the property is 42%. The next largest loan (0.66%) in special servicing is an industrial property located in San Jose, CA. The property is in foreclosure with an updated appraisal indicating possible losses. In addition to the specially serviced loans there are eleven loans (3.9%) that Fitch views as concerns for declines in either occupancy or DSCR. Hypothetical stress scenarios were applied to the trust, where specially serviced and other loans that concerned Fitch as having the potential to become problematic were assumed to default. Under these stress scenarios, the resulting subordination levels of classes K and L necessitated the downgrade. Fitch will continue to monitor this transaction, as surveillance is ongoing. BRIDGE INFORMATION: Plan Administrator Balks at 52 Setoff Claims ---------------------------------------------------------------- Cynthia A. Fonner, Esq., at Foley & Lardner, in Chicago, Illinois, informs the Court that some Preference Recipients filed 52 Claims against the Bridge Information Debtors. These are some of the biggest claims: Claimant Claim No. Claim Amount -------- --------- ------------ ADP 1968, 1975 $989,355 Avnet Computer 1971 2,721,666 Copenhagen Stock Exchange 926, 945 1,040,094 Deloitte Consulting 1129 5,821,832 IBM Corporation 580 572,794 Liffe Administration & Management 1071 449,854 Nadaq Stock Market, Inc. 1228 10,764,192 New York Mercantile Exchange 1023, 1025 6,426,506 New York Mercantile Exchange 1024 1,869,961 W9/PHC Real Estate Ltd Partner 640 477,510 Pursuant to the Plan and the Confirmation Order, Ms. Fonner argues that the 52 Claims must not be allowed, or if allowed, must receive no distribution unless and until the time that the Preference Recipients have satisfied their obligation in returning the preferential transfers to the Estates. Accordingly, Scott Peltz, Chapter 11 Plan Administrator, asks the Court to disallow the 52 Claims entitled to set-off until the time that the issue of the return of preferential transfers is settled. (Bridge Bankruptcy News, Issue No. 49; Bankruptcy Creditors' Service, Inc., 609/392-0900) BRIDGEPORT HLDGS: Case Summary & 30 Largest Unsecured Creditors --------------------------------------------------------------- Lead Debtor: Bridgeport Holdings, Inc. 535 Connecticut Avenue Norwalk, Connecticut 06854 Bankruptcy Case No.: 03-12825 Debtor affiliates filing separate chapter 11 petitions: Entity Case No. ------ -------- WHSU, Inc. f/k/a Micro Warehouse, Inc. 03-12826 WHSU Ohio, Inc. f/k/a Micro Warehouse , Inc. of Oh 03-12827 WHSU Gov/Ed, Inc. f/k/a Micro Warehouse Gov/Ed, In 03-12828 WHSU International, Inc. f/k/a Micro Warehouse Int. 03-12829 Chapter 11 Petition Date: September 10, 2003 Court: District of Delaware Judge: Peter J. Walsh Debtors' Counsel: Brendan Linehan Shannon, 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- Kramer Levin Frankel & Naftalis LLP 919 Third Avenue New York, NY 10022 Estimated Assets: More than $100 Million Estimated Debts: More than $100 Million Debtors' 30 Largest Unsecured Creditors: Entity Claim Amount ------ ------------ Ingram Micro, Inc. $17,932,072 1759 Weherle Drive Williamsville, NY Attn: Verne Pryor Hewlett-Packard $8,600,602 c/o Bank of America 6000 Feldwood Road College Park, GA Tel: 650-857-7434 Toshiba America Computer Sys $2,234,192 c/o Bank of America 91865 Collections Center Drive Chicago, IL 60693 Attn: Jackie Dasilva Tel: 949-583-3537 Microsoft Corporation $2,234,192 PO Box 844505 Dallas, TX 95284-4505 Attn: Sylvia Upham Tel: 775-823-5665 Bell Microproducts Inc. $1,477,053 1941 Ringwood Avenue San Jose, CA 95131 Attn: Rebecca Cruz Tel: 334-954-6117 Epson America $1,316,096 PO Box 371029M Pittsburgh, PA 15251 Attn: Cheryl Bivens Tel: 562-290-5077 Fuji Photo Film $1,315,864 200 Summit Lake Drive 2nd Floor Valhalla, NY 10595-1356 Attn: Linda Cassano Tel: 800-755-3854 Comstor $1,010,491 3 Ridgeview, Suite 200 14850 Conference Center Drive Chantilly, VA 20151 Attn: Kimberly Kley Tel: 703-345-5132 International Computer Graphics $977,364 30481 Whipple Road Union City, CA 94587 Attn: Lynn Ochoa Tel: 510-471-7000 x 264 PC Wholesale $740,279 444 Scott Drive Bloomindale, IL 60108 Smart Modular $646,338 3343 Collections Drive Chicago, IL 60693 Attn: Tony Bowers Tel: 510-624-8270 Adobe Systems Inc. $559,219 75 Remittance Drive Suite 1025 Chicago, IL 60675-1025 Attn: Nora Chen Tel: 408-536-6496 Infocus Systems Inc. $559,219 277700 B.S.W. Parkway Wilsonville, OR 97070 Attn: Bernadine Moore Southern Electronic Corp $521,995 4916 N. Royal Atlanta Drive Tucker, GA 30084 Achieve Memory $508,673 PO Box 15132 Fremont, CA 94539 Attn: Chantelle Wong, Accounts Record Digital Storage Inc. $465,676 PO Box 71-3228 Columbus, OH 43271 Tel: 1-800-232-3475 Douglas Stewart Company $449,342 PO Box 68-9622 Milwaukee, WI 53268-9622 Attn: Pat Holl Tel: 1-800-279-2794 x 310 American Power Conversion $383,136 5081 Collections Center Drive Chicago, IL 60693-5081 Attn: Fran Wilcox Tel: 800-788-2208 x 2537 Commodity Components $346,523 International Inc. 100 Summit Street Peabody, MA 01960 Fujitsu PC Corporation $342,082 PO Box 73867 Chicago, IL 60673-7867 Tel: 408-761-9385 Tel: 408-764-9385 Canon USA $323,391 PO Box 33157 Newark, NJ Attn: Ed Albanese Tel: 732-521-7511 Brother International $323,391 100 Sommerset Corporation Blvd. Bridgewater, NJ 08807-0911 Tel: 908-252-3133 ViewSonic Corporation $290,959 1000 West Temple Street Los Angeles, CA 90012 Attn: Michael Middleton Tel: 909-444-8719 MicronPC, LLC $224,954 Belkin Components $219,162 Airborne Express $210,165 Pertron Electronics $204,839 La Cie $189,678 Syn-Conn, LLC $186,974 Compucable Corporation $185,966 CALYPTE BIOMEDICAL: Marr Tech. Discloses 21.4% Equity Stake ----------------------------------------------------------- Marr Technologies BV beneficially owns 12,433,333 shares of the common stock of Calypte Biomedical Corporation. Marr Technologies BV is a Limited Company incorporated in The Netherlands, engaging in the technology business and investment in the technology sector. MTBV purchased 12,433,333 shares of common stock of the Company over a period beginning on July 29, 2003 and ending on August 21, 2003. MTBV spent $3,102,340 in making such purchases and funded such purchases from its working capital. The shares of stock were purchased for investment purposes. MTBV has sole voting and dispositive power with respect to 12,433,333 shares, or approximately 21.4% of the 58,066,483 shares of common stock of the Company outstanding. Calypte Biomedical Corporation -- whose June 30, 2003 balance sheet shows a total shareholders' equity deficit of about $11 million -- headquartered in Alameda, California, is a public healthcare company dedicated to the development and commercialization of urine-based diagnostic products and services for Human Immunodeficiency Virus Type 1 (HIV-1), sexually transmitted diseases and other infectious diseases. Calypte's tests include the screening EIA and supplemental Western Blot tests, the only two FDA-approved HIV-1 antibody tests that can be used on urine samples. The company believes that accurate, non- invasive urine-based testing methods for HIV and other infectious diseases may make important contributions to public health by helping to foster an environment in which testing may be done safely, economically, and painlessly. Calypte markets its products in countries worldwide through international distributors and strategic partners. Current product labeling including specific product performance claims can be found at http://www.calypte.com CASELLA WASTE: Reports 2004 First Quarter Financial Results ----------------------------------------------------------- Casella Waste Systems, Inc. (Nasdaq: CWST), a regional, non- hazardous solid waste services company, reported financial results for the first quarter of its 2004 fiscal year. For the quarter ended July 31, 2003, the company reported revenues of $113.9 million. The company's net income per common share was $0.22. Operating income for the quarter was $10.4 million. The company's earnings before interest, taxes, depreciation and amortization (EBITDA), was $25.1 million. The company also announced that cash provided by operating activities for the quarter was $15.0 million, and that the company generated negative free cash flow of a deficit of $1.5 million; as of July 31, 2003, the company had cash on hand of $5.7 million, and had an outstanding total debt level of $309.3 million. The company's three-month net income reflects a gain of $2.7 million, or $0.11 per common share, from a change in accounting principle following the company's adoption of SFAS 143. "We are starting fiscal year 2004 very strongly," John W. Casella, chairman and chief executive officer, said. "We have had several quarters to place our strategic and management focus on our core businesses, and this has allowed us to build significant momentum. Disposal Capacity Additions Highlight First Quarter "This focus and momentum has produced results, specifically in the area of adding disposal capacity in both our eastern and western regions," Casella said. "The Templeton, Massachusetts landfill, and most recently our success with the McKean County, Pennsylvania and the Ontario County, New York landfills, are indications of how well positioned the company is becoming to deliver long-term performance. "We continue to pursue several promising opportunities throughout our markets," Casella said. "We are leveraging our strength as an established, proven partner to municipal governments." Non-GAAP Financial Measures In addition to disclosing financial results prepared in accordance with Generally Accepted Accounting Principles, we also disclose EBITDA (earnings before interest, taxes, depreciation and amortization) and free cash flow which are non-GAAP measures. Casella Waste Systems (S&P, BB- Corporate Credit Rating, Stable), headquartered in Rutland, Vermont, provides collection, transfer, disposal and recycling services primarily in the northeastern United States. For further information, visit the company's Web site at http://www.casella.com CASUAL MALE: Plan Confirmation Hearing Scheduled for Nov. 18 ------------------------------------------------------------ As previously reported in the Troubled Company Reporter's September 8, 2003 issue, Casual Male Corp., and its debtor- affiliates filed with the U.S. Bankruptcy Court for the Southern District of New York, their Joint Liquidating Chapter 11 Plan and Disclosure Statement. The Court has scheduled the Disclosure Statement Hearing on October 7, 2003. In this regard, the Court now schedules a hearing to consider confirmation of the Plan on November 18, 2003 at 9:45 a.m. All written objections to the confirmation of the Plan must be received by the Court on or before 4:00 p.m. on November 10, 2003, and copies must be served on: i) Attorneys for the Debtors Cadwalader, Wickersham & Taft LLP, 100 Maiden Lane, New York, New York 10038 Attention: Adam C. Rogoff, Esq.; ii) Attorneys for the Official Committee of Unsecured Creditors Kronish, Lieb, Werner & Hellman LLP 1114 Avenue of the Americas, New York, New York 10136, Attention: Lawrence C. Gottlieb, Esq.; iii) the Office of the United States Trustee 33 Whitehall Street, 21st Floor New York, New York 10004 Attention: Brian Masumoto, Esq.; and iv) Casual Male Corp., et al. 555 Turnpike Street, Canton, Massachusetts 02021 Attention: Michael O'Hara, Esq. Casual Male Corp. with its debtor-affiliates filed for chapter 11 protection on May 18, 2001. Adam C. Rogoff, Esq., at Cadwalader, Wickersham & Taft represents the Debtors as they wind-down their assets. When the Company filed for protection from its creditors, it listed $299,341,332 in total assets and $244,127,198 in total debts. The Debtors anticipate that the Estates may have in excess of $70 million to be distributed to creditors under a chapter 11 plan. CONSECO FIN.: Court Confirms 6th Amended Joint Liquidation Plan --------------------------------------------------------------- U.S. Bankruptcy Court Judge Doyle evaluated the Conseco Finance Debtors' Plan for its adequacy and fairness, including the arguments and representations made by James H.M. Sprayregen, Esq., at Kirkland & Ellis LLP, in Chicago, Illinois, made, which are: A. Compliance with Section 1129(a)(1) of the Bankruptcy Code Pursuant to Sections 1122(a) and 1123(a)(1) of the Bankruptcy Code, the Plan designates Classes of Claims and Equity Interests, other than Administrative Claims and Priority Tax Claims. As required by Section 1122(a), each Class of Claims and Equity Interests contains only Claims or Equity Interests that are substantially similar to the other Claims or Equity Interests within that Class. The CFC Debtors presented clear and convincing evidence that valid business, factual and legal reasons exist for separately classifying the various Classes of Claims and Equity Interests created under the Plan and the Classes do not unfairly discriminate between holders of Claims or Equity Interests. Pursuant to Sections 1123(a)(2) and (3), the Plan specifies all Claims that are not Impaired and specifies the treatment of all Claims and Equity Interests that are impaired. Pursuant to Section 1124(a)(4), the Plan also provides the same treatment of each Claim or Equity Interest within a particular Class. Pursuant to Section 1123(a)(5) of the Bankruptcy Code, the Plan provides adequate and proper means for the Plan's implementation. The Debtors will have, as of the Effective Date of the Plan, sufficient Cash to make all payments required to be made on the Effective Date pursuant to the of the Plan. Moreover, the Plan specifically provide adequate means for the Plan's implementation to satisfy Section 1123(a)(5), including, without limitation: (a) selling assets; (b) establishing the Post-Consummation Estate; (c) funding expenses of the Post-Consummation Estate; (d) appointing a Plan Administrator; (e) canceling notes, instruments, debentures and equity securities; (f) creating, without duplication, the Claims Settlement Escrow Account, Professional Fee Sub-Escrow Account, Post-Consummation Estate Budget Sub-Escrow Account, Employee Benefit Sub-Escrow Account 93/94 Note Claim Escrow Account, Consent Agreement Reserve Account, the HE/HI/REC Reserve Account, the Shared Recovery Escrow Account and BED Escrow Account; (g) generally allowing for all corporate action necessary to effectuate the Plan; (h) listing the source of cash from which the Finance Company Debtors will make payments under the Plan; and (i) providing for the payment of any retiree benefits as defined in Section 1114(a) of the Bankruptcy Code. The requirements of Section 1123(a)(6) is inapplicable since the CFC Debtors are liquidating. The Plan complies with Section 1123(a)(7) because the selection of the Post-Consummation Estate Advisory Board and the Plan Administrator has been accomplished in a fair and reasonable manner, consistent with public policy. The Plan's provisions are appropriate and consistent with the applicable provisions of the Bankruptcy Code, including, without limitation, provisions for: -- distributions to claim holders, -- the disposition of executory contracts and unexpired leases, -- the retention of, and the right to enforce, sue on, settle or compromise certain claims or causes of action against third parties, to the extend not waived or released under the Plan, -- resolution of Disputed Claims, -- allowance of certain claims, -- indemnification obligations, -- releases by the Debtors and Debtors-in-Possession, and -- releases by holders of Claims and Equity Interests. B. Compliance with Section 1129(a)(2) of the Bankruptcy Code The CFC Debtors are proper debtors under Section 109 of the Bankruptcy Code and proper proponents of the Plan under Section 1121(a) of the Bankruptcy Code. Moreover, the solicitation of acceptances or rejection of the Plan was: -- pursuant to the Solicitation Procedures Order; -- in compliance with all applicable laws, rules and regulations governing the adequacy of disclosure in connection with the solicitation; and -- solicited after disclosure to holders of Claims or Interests of adequate information. The CFC Debtors, their directors, officers, employees, agents, affiliates and professionals acted in "good faith" within the meaning of Section 1125(e) of the Bankruptcy Code. C. Compliance with Section 1129(a)(3) The CFC Debtors proposed the Plan in good faith and not by any means forbidden by law. The Plan was filed with the legitimate purpose of maximizing the value of their assets and the recovery to Claims holders under the circumstances of these cases. D. Compliance with Section 1129(a)(4) All payments made or promised for services and cost in connection with the Plan and incident to the Chapter 11 cases, has been, or will be disclosed to the Court. Any payment made before confirmation was reasonable and was made with appropriate Court authority. All payments to be fixed after confirmation will be made pursuant to the Post-Consummation Estate Budge or the terms of the Plan and are subject to the Court's approval. The fee payable to the Plan Administrator pursuant to the Bridge Retention Letter are approved as reasonable under Section 1129(a)(4). In addition, fees and expenses incurred by Professionals will be payable according to the Orders approving their retention. E. Compliance with Section 1129(a)(5) This requirement is inappropriate in that the CFC Debtors are not reorganizing but are liquidating pursuant to the Plan. To the extent that the Section applies to the Post- Consummation Estate, the CFC Debtors have disclosed that they, together with the Committee, have determined that Bridge Associates LLC and Anthony H.N. Schnelling as Bridge representative, will be the Plan Administrator. The CFC Debtors and the Committee will identify the members of the Post-Consummation Estate Advisory Board prior to the Effective Date. The CFC Debtors further disclosed that any CFC Debtors current employees who will provide services to the Post- Consummation Estate after the Effective Date will be retained as independent contractors. F. Compliance with Section 1129(a)(6) After the Plan is confirmed, no governmental regulatory commission will have jurisdiction over the rates of the CFC Debtors since they are liquidating under the Plan. G. Compliance with Section 1129(a)(7) The liquidating analysis in the Disclosure Statement, the Cremens Affidavit and all other evidence adduced at the Confirmation Hearing: -- are persuasive, credible and accurate as of the dates they are prepared, presented or proffered; -- either have not been controverted by other persuasive evidence or have not been challenged; -- are based on reasonable and sound assumptions; -- provide a reasonable estimate of the liquidation values of the CFC Debtors upon conversion to a case under Chapter 7; and -- establish that each holder of a Claim or Equity Interest in an Impaired Class that has not accepted the Plan will receive or retain under the Plan, on account of their Claim or Equity Interest, property of a value, as of the Plan Effective Date, that is not less than the amount that it would have received if the CFC Debtors were liquidated under Chapter 7. H. Compliance with Section 1129(a)(8) On a substantively consolidated basis, all voting Impaired Classes have voted to accept the Plan. The Plan provides that Class 6 Claim Holders will not receive any distribution or retain any property under the Plan and are therefore deemed to have rejected the Plan. Nevertheless, the Plan is confirmable because the Plan satisfies Section 1129(b)(1) with respect to Class 6. I. Compliance with Section 1129(a)(9) Subject to the provisions of Sections 328, 330(a) and 331 of the Bankruptcy Code, each holder of an Allowed Administrative Claim will be paid put of the Claim Settlement Escrow Account the full unpaid amount in Cash: -- on the Effective Date or as soon as practicable, -- if allowed after the Effective Date, on the date the Administrative Claims is allowed or as soon as is practicable, or -- on other terms as may be agreed by the parties or otherwise upon a Court order. J. Satisfaction of Section 1129(a)(10) Each Impaired Class of Claims entitled to vote -- Classes 3, 4 and 5 -- has voted to accept the Plan and, to the best of the CFC Debtors' knowledge, do not contain "insiders." K. Satisfaction of Section 1129(a)(11) The financial projections: -- are persuasive and credible, -- have not been controverted by other evidence or sufficiently challenged in any of the Plan objections, and -- establish that the Plan is feasible and that Plan confirmation is not likely to be followed by liquidation, or as the need for further financial reorganization of the CFC Debtors, except as otherwise proposed in the Plan. The CFC Debtors will have sufficient funds to satisfy their obligations under the Plan and to fund the costs and expenses of the Post-Consummation Estate. L. Compliance with Section 1129(a)(12) The Plan provides for the payment of all fees payable under Section 1930 of the Judiciary Code, each quarter until the cases are converted, dismissed or closed, whichever occurs first. The CFC Debtors and the Post-Consummation Estate have adequate means to pay all fees as set forth in the Post- Consummation Estate Budget. M. Compliance with Section 1129(a)(13) The Plan provides that the CFC Debtors will timely pay any retiree benefits to the extent they are payable. The retiree benefits include those that arise from the plans, funds or programs described in the Plan Supplement, and the payment to the retiree benefits will be made out of the Claim Settlement Escrow Account. N. Compliance with Section 1129(b) On a consolidated basis, all voting Impaired Classes voted to accept the Plan. On a Debtor-by-Debtor basis, all Classes of Impaired Claims voted to accept the Plan other than Class 6, which is presumptively deemed to have rejected the Plan. Pursuant to Section 1129(b)(1), the Plan may be confirmed even if not all Impaired Classes voted to accept the Plan. All of the requirements of Section 1129(a) other than Section 1129(a)(8) with respect to the Impaired Classes have been met. With respect to Class 6, no holder of Claims junior to the Class 6 Claims will receive or retain any property under the Plan on account of their junior Claims. Moreover, no Class of Claim or Equity Interests senior to any Classes is receiving more than full payment on account of the Claims. Thus, Section 1129(b) is satisfied on a consolidated basis. Section 1129(b) is also satisfied on a de-consolidated basis, in particular because: (a) all voting Impaired Classes voted to accept the Plan; (b) Class 6, a non-voting Impaired Class, is deemed to have rejected the Plan under Section 1126(g) as no distributions will be made thereto; and (c) CIHC, as the sole shareholder in Class 6, agreed to its treatment under the Plan. There are no claims or interest junior to Class 6 and no distributions will be made to any claim or interest junior to the Class 6 Claims. Accordingly, the Plan is fair and equitable, and does not unfairly discriminate. Moreover, Judge Doyle notes that: (a) all Plan confirmation objections have been withdrawn, settled or have been overruled on their merits pursuant to other Court orders; (b) the CFC Debtors have exercised reasonable business judgment in determining whether to assume or reject the contracts and leases as the Plan provides. The Debtors have cured, or have provided reasonable assurances to cure defaults, if any; (c) the Plan is not the avoidance of taxes or the avoidance of application of Section 5 of the Securities Act of 1933; (d) the satisfaction and releases of Claims and Causes of Action constitute good faith compromises and settlements of the matters covered; (e) all settlements and compromises of Claims and Causes of Action between and among the CFC Debtors, Lehman, the Securitization Trustee, the 93/94 Note Holders and the Committee that are embodied in the Plan are fair, equitable and in the best interest of the CFC Debtors and their estates and creditors; (f) each of the conditions precedent to the entry of a Confirmation Order has been satisfied or waived in accordance with the Plan; and (g) each of the conditions precedent to the Effective Date is reasonably likely to be satisfied. Accordingly, Judge Doyle confirms the CFC Debtors' Sixth Amended Plan of Liquidation. * * * On September 9, 2003, the CFC Debtors delivered to the Court their Sixth Amended Joint Plan of Liquidation to reflect minor changes, including: A. Dismissal of Certain Actions On the Effective Date or as soon as practicable: -- the Committee will dismiss, with prejudice, the Lehman Adversary Proceeding; -- Lehman will dismiss, with prejudice, the Lehman Appeal; and -- the Mill Creek Standing Motion will be deemed denied with prejudice. B. Claim Objection Deadline The Plan Administrator will have one year from the Effective Date to file objection to Claims filed against the Estates. C. Transfer of Assets The Finance Company Debtors and the Plan Administrator will establish the Post Consummation Estate on behalf of the Beneficiaries pursuant to the Post-Consummation Estate Agreement to be treated as the grantors and deemed owners of the Post-Consummation Estate Assets and the Finance Company Debtors will transfer, assign and deliver to the Post- Consummation Estate, on behalf of the Beneficiaries, all of their right, title and interest in the Post-Consummation Estate Assets, including claims and causes of action of the Finance Company Debtors other than any claims and causes of action waived, exculpated or released, notwithstanding any prohibition of assignability under applicable non-bankruptcy law. The Post-Consummation Estate will agree to accept and hold the Post-Consummation Estate Assets in the Post- Consummation Estate for the benefit of the Beneficiaries, subject to the terms of the Post-Consummation Estate Agreement. Bridge Associates LLC will be tasked to provide wind down and dissolution services and make Anthony H.N. Schnelling available as Plan Administrator to implement the provisions of the Plan. (Conseco Bankruptcy News, Issue No. 31; Bankruptcy Creditors' Service, Inc., 609/392-0900) CONSECO INC: Successfully Emerges from Chapter 11 Proceedings ------------------------------------------------------------- Conseco, Inc. announced that its sixth amended joint plan of reorganization under Chapter 11, which was confirmed by the U.S. Bankruptcy Court Tuesday, has become effective. William J. Shea, Conseco's president and CEO, said, "We are very pleased to announce that Conseco has emerged from bankruptcy court protection as a financially stable company now totally focused on the insurance business." New Capital Structure Under the terms of the plan, the company has emerged as a Delaware corporation with a new capital structure consisting of: (1) a $1.3 billion secured bank facility; (2) new convertible preferred stock with an aggregate liquidation preference of approximately $860 million; (3) new warrants to purchase 6 million shares of common stock at an exercise price of $27.60 per share; and (4) approximately 100 million shares of new common stock. The company expects to issue these securities shortly, pursuant to the terms of the plan. The new common stock has been approved for listing on the New York Stock Exchange under the symbol "CNO," and the new warrants have been approved for listing on the NYSE under the symbol "CNO WS." "Regular way" trading of the new common stock and new warrants is expected to commence in the near future. The common stock is currently trading on a "when issued" basis in the over-the-counter market under the symbol "CNSJV." The company's former common stock (OTCBB:CNCEQ) has been cancelled. The new convertible preferred stock will be distributed to the prepetition lenders, the new warrants will be distributed to the holders of the Trust Preferred Securities commonly known as "TOPrS," and the new common stock will be distributed to the holders of the following prepetition claims: (1) bonds, which were separately classified as the Exchange Note Claims (those who had exchanged their bonds in 2002) and the Original Note Claims (those who had not); (2) general unsecured claims against Conseco, Inc.; (3) general unsecured claims against CIHC, Incorporated (CIHC); and (4) TOPrS. The initial distribution of approximately 98 million shares of new common stock is expected to be made as follows: -- Exchange Note Claims will receive approximately 60.6 million shares, which corresponds to a projected recovery of approximately 72%. -- Original Note Claims will receive approximately 32.3 million shares, which corresponds to a projected recovery of approximately 42%. -- Conseco General Unsecured Claims will receive approximately 1 million shares, which corresponds to a projected recovery of approximately 22%. -- CIHC General Unsecured Claims will receive approximately 1.9 million shares, which corresponds to a projected recovery of approximately 100%. -- TOPrS will receive 1.5 million shares, which corresponds to a projected recovery of approximately 1.27% (excluding the new Conseco warrants and other collection rights). In each case, the projected recoveries are based on an estimated value of the common stock of $16.40 per share for purposes of the plan. The initial distributions are expected to represent approximately 98% of all new common stock to be distributed under the plan. The company may make additional distributions to holders of prepetition bonds and/or general unsecured claims on account of disputed claims. Under the plan, there will be only one distribution of new common stock to holders of the TOPrS. New Board of Directors Takes Office "As part of the reorganization," Shea said, "we have selected a new board of directors. I have been joined on the Board by six new independent directors selected by the official creditors committee through a formal selection process:" -- R. Glenn Hilliard (60) (the non-executive chairman of the board) is the retired former chairman and chief executive officer of ING Americas. As CEO of ING Americas, he was responsible for insurance, funds and retail banking operations in North and South America. He also served as chairman of the ING America Insurance Holdings Board. -- Philip Roberts (61) is a consultant for investment management firms, advising on mergers, acquisitions and product development, having retired as chief investment officer of the trust business at Mellon Financial Corporation. -- Neal Schneider (58) is managing partner of the New York office of Smart and Associates LLP, a business advisory and accounting firm. -- Mike Shannon (45) is the co-founder and current president and chief executive officer of KSL Resorts, a firm that owns and operates resort hotels and golf courses throughout the United States. -- Michael Tokarz (53) is a founding member and current CEO of Tokarz Cadigan Partners LLC, a private investment firm focused on middle-market companies. -- John Turner (62) is chairman of Hillcrest Capital Partners, a private equity firm, and is the retired vice chairman and member of the executive committee for ING Americas. (Visit http://www.conseco.comfor more detailed biographical information on the members of Conseco's new board.) R. Glenn Hilliard, Conseco's new non-executive chairman, said: "Our near-term goal is to build the capital in the insurance companies in order to put Conseco on a track toward steady growth. Longer-term, our goal is to build a company that delivers meaningful value to our customers, our shareholders, our distribution partners and our associates. I'm convinced that this management team and board will make that happen." "Fresh Start" Accounting to be Implemented Conseco will adopt "fresh-start" reporting as of its emergence from Chapter 11, in accordance with accounting rules. These rules require Conseco to revalue its assets and liabilities to current estimated fair value, re-establish shareholders' equity at the reorganization value determined in connection with the plan, and record any portion of the reorganization value which cannot be attributed to specific tangible or identified intangible assets as goodwill. The adoption of fresh start accounting will have a material effect on Conseco's financial statements. As a result, the company's financial statements published for periods following Sept. 9, 2003, will not be comparable with those prepared before that date. The Sixth Amended Joint Plan of Reorganization is available at http://www.bmccorp.net/conseco Conseco, Inc.'s insurance companies help protect working American families and seniors from financial adversity: Medicare supplement, cancer, heart/stroke and accident policies protect people against major unplanned expenses; annuities and life insurance products help people plan for their financial future. CONSECO INC: Court Sets Deemed Amounts for Class 8A Claims ---------------------------------------------------------- Under Conseco's Plan, the Reorganizing Debtors are required to reserve shares of New CNC Common Stock as the New CNC Common Stock Holdback. Anne Marrs Huber, Esq., at Kirkland & Ellis LLP, in Chicago, Illinois, notes that 40 Claims do not list a value or amount and, instead, are listed as unknown or undetermined -- the Unliquidated Claims. Moreover, the Debtors rejected nine executory contracts for which the date to file claims against the Reorganizing Debtors has not yet passed -- the Potential Contract Damages -- and for which the non-debtor contract parties have not yet filed Claims. Accordingly, Conseco asks the Court to set the Deemed Amounts for: A. the 40 Unliquidated Claims in Class 8A to $0, except for these Unliquidated Claims: Claimant Claim No. Amount -------- --------- ------ Amended Hilbert Residence Trust 49672-006378 to be decided Ngaire E. Cunco 49672-006685 $5,000,000 Wells Fargo Finance Bank 49672-006929 10,000 B. for the nine Potential Contract Damages in Class 8A: Claimant Amount -------- ------ The Bar Plan Mutual Insurance Company $0 American Contractors Indemnity Corporation 0 ACE Bond Services, TL33B Surety Office 0 International Fidelity Insurance Company 0 CNA Surety/Western Surety 5,000,000 The Aetna Casualty and Surety Company 10,000 Gary Wendt 1,000,000 Participants under Agency Deferred To be decided Compensation Program Participants in Producer Stock Award and To be decided Option Plan Ms. Huber clarifies that the proposed Deemed Amounts do not constitute an admission or acknowledgment as to any liability or damages for the Unliquidated Claims or the Potential Contract Damages. To the contrary, the Debtors believe that the proposed Deemed Amounts cover the maximum amount these Claimholders could allege. Moreover, the Debtors propose a zero Deemed Amount to Gary Wendt's Claims -- Claim Nos. 49672-007823 and 49674-000245 -- because they believe that Mr. Wendt's Claims do not require any reserve to be established under the Plan. Stipulations In two separate Court-approved Stipulations, the issue on the deemed claim amounts is resolved between the Debtors and these Claimants: (a) Ngaire E. Cuneo, Richard R. Cuneo, Lauren E. Cuneo Irrevocable Trust, Matthew R. Cuneo Irrevocable Trust and Michael D. Cuneo Irrevocable Trust; and (b) the Amended Hilbert Residence Trust, the Stephen & Tomisue Hilbert Irrevocable Trust and the Dick Family Irrevocable Trust. The Parties agree that: (1) For purposes of reserving New CNC Common Stock under the Plan, the Reorganizing Debtors will set the Deemed amounts for these Claims: Claimant Claim No. Deemed Amount -------- --------- ------------- Ngaire E. Cuneo 49672-006685 $7,500,000 Richard R. Cuneo 49672-006842 0 Lauren Cuneo 49672-006843 0 Irrevocable Trust Mattheo R. Cuneo 49672-006844 0 Irrevocable Trust Michael D. Cuneo 49672-006845 0 Irrevocable Trust Amended Hibert 49672-006377 7,269,141 Residence Trust Stephen & Tomisue 49672-006378 3,040,846 Hilbert Irrevocable Trust Dick Family Irrevocable 49672-006379 3,771,569 Trust (b) The Deemed Amounts may be reduced as the Claims are resolved; and (c) Nothing in the Stipulation will constitute an admission of liability or constitute a determination on the merits arising from or related to the Claims, the Objections or the Responses; or prejudice the Claimants from asserting amounts in excess of the Deemed Amounts. * * * Judge Doyle rules that: A. eight Claims will have these Class 8A Deemed Amounts, which will be used to calculate the New CNC Common Stock Holdback: Claimant Claim No. Amount -------- --------- ------ The Bar Plan Mutual Insurance not applicable $0 American Contractors Indemnity not applicable 0 ACE Bond Services not applicable 0 International Fidelity Insurance not applicable 0 CAN Surety/Western Surety not applicable 5,000,000 The Aetna Casualty and Surety not applicable 10,000 Minn. Dept. of Commerce 49672-008514 0 Everett C. Mosley 49672-008564 0 B. the hearing for these Claims are continued to the next omnibus hearing: Claimant Claim No. Amount -------- --------- ------ U.S. Bank National Association 49672-006859 $0 Wells Fargo Financial Bank 49372-006929 10,000 Wells Fargo Financial Leasing 49372-006928 0 Gary C. Wendt 49672-007823 0 49672-000245 0 not applicable 1,000,000 Wilmington Trust Company 49372-006935 0 C. 23 Unliquidated Claims with $0 proposed Deemed Amounts are withdrawn because they have been disallowed by previous Court orders. The Debtors withdraw from the list the proposed Deemed Amounts for the Potential Contract Damages of the Participants under the Agency Deferred Compensation Program and the Participants in Producer Stock Award and Option Plan. (Conseco Bankruptcy News, Issue No. 31; Bankruptcy Creditors' Service, Inc., 609/392-0900) DANA CORP: Opens New Fuel Cell Support Centers in UK and Japan -------------------------------------------------------------- Dana Corporation (NYSE: DCN) is expanding its global engineering network by opening new Fuel Cell Support Centers in Rugby, England, and Toyohashi, Japan. These new centers reinforce Dana's commitment to invest in engineering talent to support the development of fuel cell technologies for use in offices, homes, and vehicles of the future. The two new support centers complement facilities in Neu-Ulm, Germany; Paris, Tenn. (U.S.A.); and Oakville, Ontario, Canada. Combined, the five centers -- each with a unique area of technical emphasis -- will serve as a network of specialist centers to support engineering research and high-volume production methods. Through this global network of fuel-cell technology centers, Dana is actively developing high-quality, cost-effective OEM components for the fuel-cell industry. At the Rugby center, the team is engaged in developing derivations of Dana's Intelligent Cooling(TM) pumps to make them suitable for fuel-cell applications. The new center in Japan is located in the existing Dana Asian Technical Center. The center will focus on new business and applications support for the Asian markets. Personnel experienced with fuel-cell knowledge are joining existing staff currently working at the technical center. Both new centers have extensive engineering, testing, designing, prototyping, and customer service capabilities. In addition, they are closely integrated into the Dana network, enabling the Fuel Cell Support Center teams to call on the expertise available from Dana's worldwide technical resources. "In creating this network of Fuel Cell Support Centers, we are able to develop intellectual property around our core products," said Joe Magliochetti, Dana chairman and CEO. "By drawing on our global expertise and technology resources, we are helping the fuel-cell industry emerge as a mainstream technology." "In addition to providing specialized fuel-cell technology expertise, our automotive bloodlines enable us to bring the knowledge of high-volume manufacturing and quality systems to the fuel cell industry," added Mike Laisure, president, Engine and Fluid Management Group. "This knowledge is essential to help fuel cell developers move from the development stage to low-volume manufacturing and eventually to a high-volume market." Dana -- whose $250 million debt issue is rated by Standard & Poor's at 'BB' -- is a global leader in the design, engineering, and manufacture of value-added products and systems for automotive, commercial, and off-highway vehicle manufacturers and their related aftermarkets. The company employs more than 60,000 people worldwide. Founded in 1904 and based in Toledo, Ohio, Dana operates hundreds of technology, manufacturing, and customer service facilities in 30 countries. The company reported 2002 sales of $9.5 billion. DANA CORP: Will Construct New Manufacturing Plant in Czech Rep. --------------------------------------------------------------- Dana Corporation (NYSE: DCN) will construct a new manufacturing facility in Kadan, Czech Republic. Construction of the facility is expected to begin in 2004. "The opening of this facility further strengthens Dana's ability to respond quickly and effectively to marketplace demands," said company Chairman and CEO Joe Magliochetti. "The move demonstrates our commitment to the Eastern European market and expands our ability to provide innovative products to our global customers." The new 52,000 sq. ft. (4,800 sq. m.) facility will manufacture automotive heat exchangers and will employ approximately 200 people. The plant will supply automotive Tier I and original equipment manufacturers mainly in Germany and Eastern Europe. The town of Kadan is near the German border, approximately 60 miles (100 kilometers) northwest of Prague. "We continue to grow our business in Europe," said Mike Laisure, president of Dana's Engine and Fluid Management Group. "We selected the Czech Republic because of its accessibility to qualified, skilled labor and its proximity to current and potential customers." Dana has been working with CzechInvest, part of the Czech Republic's Ministry of Industry and Trade, for site selection and development, in addition to local supplier development, financing, logistics, and employee recruitment. Dana -- whose $250 million debt issue is rated by Standard & Poor's at 'BB' -- is a global leader in the design, engineering, and manufacture of value-added products and systems for automotive, commercial, and off-highway vehicle manufacturers and their related aftermarkets. The company employs more than 60,000 people worldwide. Founded in 1904 and based in Toledo, Ohio, Dana operates hundreds of technology, manufacturing, and customer service facilities in 30 countries. The company reported 2002 sales of $9.5 billion. DIAMOND ENTERTAINMENT: Hires Pohl McNabola as New Accountants ------------------------------------------------------------- On September 2, 2003 the Board of Directors of Diamond Entertainment Corporation approved the engagement of Pohl, McNabola, Berg & Company LLP to serve as the Company's independent public accountants and to be the principal accountants to conduct the audit of the Company's financial statements for the fiscal year ending March 31, 2003, and to re-audit the financial statements of the Company for the year ended March 31, 2002. On August 26, 2003, the Company reported the resignation of its previous principal independent accountant, Stonefield Josephson, Inc. The company distributes budget videos and DVDs (priced $1.99- $12.99), including collections starring Abbott and Costello, Ozzie and Harriet, and Martin and Lewis. Its some 750 video titles -- most in the public domain -- include motion pictures, television episodes, sports, software tutorials, cartoons, and educational programs. Diamond Entertainment also sells childrens' toys through Jewel Products International. Its CineChrome division sells greeting cards. The company sells through mass merchandisers, consignment arrangements with a mail order catalog and retail chain, and through its Web site. CEO James Lu owns about 7% of the firm. Diamond Entertainment's December 31, 2002, balance sheet shows a working capital deficit of over $1 million, and a total shareholders' equity deficit of about $509,000. DIGITAL WORLD: Searching for Chartered Accountant Replacement ------------------------------------------------------------- Digital World Cup Inc.'s Chartered Accountant, who was previously engaged as the Company's principal accountant, submitted a letter of resignation on July 7, 2003. According to the Company, the resignation was not because of any problems related to generally accepted accounting principals or any audit of the Company. The principal accountant's report on the financial statements for the past two years contained no adverse opinion or a disclaimer of opinion, however for both years it was qualified as to uncertainty concerning Digital World Cup's ability to continue as a going concern. The decision to change accountants was not recommended or approved by the Board of Directors. The Company does not have an auditing committee. Digital World Cup not yet engaged a new chartered accountant but is actively seeking one. DOW CORNING: Launches New Global Photonic Solutions Business ------------------------------------------------------------ Dow Corning Corp., has launched a new global Photonic Solutions business. This Photonics business takes the advantages of silicon-based materials into the optical domain for next generation high-performance, cost-effective optical applications across multiple market sectors. Dow Corning is building on its 60 years of leadership in silicon- based materials to establish the new global Photonic Solutions business. The unique properties of silicon-based technology, combined with Dow Corning's extensive experience in the production and packaging of high purity performance materials make it well suited for Photonics applications. In addition, Dow Corning's capabilities in supply chain management solutions are positioned to serve customers around the world. Photonics is the technology of generating, guiding and harnessing light for a range of applications extending from communications to information processing. "We are building on a long history of successful silicon-based material applications in Electronic devices, which have proven reliable over a wide range of thermal and environmental conditions. These properties combined with their excellent optical characteristics of stability under high flux and processing flexibility enable high-performance and cost- effective solutions for a broad range of optical applications," says Babette Pettersen, Director of the Dow Corning Global Photonics Program. "Photonics is an exciting, high-potential, fast-growth field." Dow Corning's Photonic Solutions offering includes advanced silicon-based materials, device technologies and services. "Dow Corning Photonics is working on device technologies, both independently and through partnerships, to provide not only the enabling materials, but also the device integration, supply chains, and services to help customers adopt innovative optical technologies," adds Pettersen. Dow Corning silicon-based materials have unique properties that make them well suited for use in optical waveguides and optical data storage solutions, including holography, optical fiber coatings, and high brightness LED packaging. Dow Corning's Photonic Solutions provide customers with flexibility and choice. Many of the required optical and mechanical properties can be customized through controlled synthesis to provide cost-effective material and processing options. "We can offer material solutions ranging from fluids and stress-relieving gels for encapsulation to rigid resins for lenses, and can tailor these over a wide range of refractive indices. We combine material properties with processing and design expertise to provide an array of choices for customers," adds Pettersen. As with all Dow Corning businesses, Photonics uses the Responsible Care(R) program as the framework to manage environment, health and safety. Dow Corning has achieved its goal of successfully implementing the Responsible Care codes on environment, health and safety practices. The milestone, reached one year ahead of schedule, is the implementation of the six Responsible Care codes, a voluntary initiative of the worldwide chemical industry that promotes continuous improvement in safety and protection of health and the environment. Dow Corning -- http://www.dowcorning.com-- provides performance- enhancing solutions to serve the diverse needs of more than 25,000 customers worldwide. A global leader in silicon-based technology and innovation, offering more than 7,000 products and services, Dow Corning is equally owned by The Dow Chemical Company and Corning, Incorporated. More than half of Dow Corning's annual sales are outside the United States. For more information about Dow Corning Photonic Solutions, visit http://www.dowcorning.com/photonics ENRON CORP: Proposes Uniform Procedures for Avoidance Actions ------------------------------------------------------------- Enron Corporation and its debtor-affiliates and their counsel have been working to determine whether any payments that the Debtors made to third parties within the 90-day period prior to the Petition Date constitute preferential or fraudulent transfers that the Debtors may avoid and recover pursuant to Sections 544, 547, 548 and 550 of the Bankruptcy Code. The Debtors estimate that there are over 1,000 entities that received millions of dollars of transfers during the applicable preference periods in the Debtors' cases. Accordingly, the Debtors ask the Court to approve the proposed procedures that will: -- streamline the adversary proceedings they will commence; -- eliminate the requirements of a scheduling conference pursuant to Rule 7026(f) of the Federal Rules of Bankruptcy Procedure; -- eliminate the requirement of initial pre-trial conferences pursuant to Bankruptcy Rule 7016; -- establish procedures for the filing of motions; and -- permit the Debtors to settle the Avoidance Actions without noticing all creditors or brining all proposed settlements before the Court for approval pursuant to Bankruptcy Rule 9019. Neil Berger, Esq., at Togut, Segal & Segal LLP, in New York, informs the Court that the Debtors wish to settle Preference Action on these terms: (a) Where the amount demanded is greater than $1,000,000, the Debtors will consult the Creditors' Committee regarding the settlement and ask the Court to approve the settlement pursuant to Bankruptcy Rule 9019; (b) Where the amount demanded is between $200,000 and $1,000,000, service of a Notice of any proposed settlement by regular, first-class mail upon counsel for the Creditors' Committee; the Office of the United States Trustee; the parties listed on the Amended Case Management Service List; and the defendant in that particular Avoidance Action will be sufficient. If no written objection is received within 10 business days after the date of service of the Notice, the Debtors will be authorized to consummate the proposed settlement without a further Court Order or consent of any other party; (c) Where the amount demanded is $200,000 or less, the Debtors will be authorized to consummate the proposed settlement without further Court Order and without giving notice to, or receiving consent from, any other party; and (d) Beginning on the 30th day after the first settlement is consummated or approved, if necessary, the Debtors will submit to the Court, the Committee and the Office of the United States Trustee a monthly status report setting forth the Avoidance Actions that have settled and the amount of each settlement. Mr. Berger notes that the proposed settlement procedures will not preclude the Court from keeping close control over the Avoidance Actions as the Debtors will provide a monthly report of all recoveries. Except to the extent required to pay the DIP Obligations, the Debtors will retain all proceeds in connection with the Avoidance Actions and neither be disbursed nor used until the earlier to occur of an agreement with the Creditors' Committee with respect to the release of the proceeds and further Court Order. Mr. Berger points out that given the volume of the Avoidance Actions that are likely to be filed, the proposed procedures are imperative. Absent the limitation, the Court's docket will be clogged with those matters and additional time will be taken up with reviewing and signing individual scheduling orders in potentially hundreds of adversary proceedings. In addition, the Streamlined Procedures will minimize the administrative costs to the estates, including, among other things, the cost and expense of having counsel travel to Court for countless conferences and serving all of the Debtors' creditors with what could amount to hundreds or thousands of motions for the approval of settlements. By limiting unbridled motion practices, Mr. Berger states, the Streamlined Procedures will result in more orderly and efficient litigation and discourage dilatory tactics on the part of the defendants. Moreover, the proposed procedures may be modified to accommodate individual deviations for good cause shown where circumstances warrant. Thus, Mr. Berger argues, the request will not prejudice the rights of any defendant in a Preference Action. The Debtors hope that the Streamlined Procedures will promote settlements since they may obviate the need for defendants to retain outside counsel during the settlement process. "Often, not having to expend substantial resources for outside counsel is a major consideration in a party's willingness to settle quickly," Mr. Berger says. (Enron Bankruptcy News, Issue No. 78; Bankruptcy Creditors' Service, Inc., 609/392-0900) FEDERAL-MOGUL: Court Approves Avoidance Action Stipulation ---------------------------------------------------------- At the Federal-Mogul Debtors' request, the Court approved their stipulation with the Official Committee of Unsecured Creditors regarding each party's rights and responsibilities in connection with the investigation and prosecution of avoidance actions. Under Section 1103(c)(2) of the Bankruptcy Code, the Unsecured Creditors' Committee may investigate whether, and to whom, preferences and fraudulent transfers were made, and the propriety of commencing Avoidance Actions to recover the transfers under Sections 544, 545, 547, 548 and 553 of the Bankruptcy Code. To determine whether the commencement of Avoidance Actions would benefit the Debtors' estates and their creditors, the parties have been jointly investigating certain transfers that may be subject to Avoidance Actions. Pursuant to Section 546(a)(1)(a) of the Bankruptcy Code, the Debtors must commence Avoidance Actions against recipients of the Transfers by October 1, 2003. The stipulation functions as a guide in the further investigation and circumstances under which the Committee will be authorized to prosecute the Avoidance Actions. In particular, the terms of the stipulation include: (a) Information Requests The Debtors will continue to provide the Unsecured Creditors' Committee information and material related to the Transfers. The Debtors will also provide the Unsecured Creditors' Committee with updated and supplemented information as such information becomes available. In addition, the Debtors will make their employees and counsel reasonably available to consult with the Unsecured Creditors' Committee. (b) Tolling Agreements Among the Debtors The Debtors are authorized to enter into tolling agreements among themselves. (c) Tolling Agreements With Former Executives The Debtors will seek to enter into tolling agreements with former executives identified by the parties. If either or all of the Former Executives do not enter into such tolling agreements and the Debtors do not commit to prosecute any and all Avoidance Actions against the Former Executives, the Unsecured Creditors' Committee will file a request for authority to commence any and all such Avoidance Actions against the Former Executives on behalf of the Debtors and their estates. (d) Designated Transferees The Debtors will furnish the Unsecured Creditors' Committee with a list of all Transferees who no longer do business with them and whom they do not intend to continue business with. The Debtors will continue to supplement the list of Designated Transferees as information may become available. However, the list of Designated Transferees will not include Transfers made on account of asbestos claims. (e) Avoidance Actions Against Designated Transferees If the Debtors do not enter into tolling agreements or commit to bring any and all Avoidance Actions against the Designated Transferees, the Unsecured Creditors' Committee will have the right, on behalf of the Debtors and their estates, to make demands, enter into tolling agreements and to commence and prosecute Avoidance Actions against the Designated Transferees. (f) Avoidance Actions Against the CCR The Unsecured Creditors' Committee will have the right to enter into tolling agreements and prosecute any and all Avoidance Actions against the Center for Claims Resolution on behalf of the Debtors and their estates. (g) Shared Authority The Unsecured Creditors' Committee's standing and authority to prosecute the Avoidance Actions pursuant to the Agreement will be deemed non-exclusive and shared with the Debtors. If either party commences or prosecutes Avoidance Actions, a party will share information relating to the Avoidance Actions upon reasonable request by the other party, the Official Committee of Asbestos Claimants, the Legal Representative for Future Asbestos Claimants, the Official Committee of Equity Security Holders or JPMorgan Chase Bank, as Administrative Agent for the holders of the Bank Claims. If the Debtors and Unsecured Creditors' Committee both undertake to prosecute Avoidance Actions, both parties should cooperate to avoid duplication of time and costs. (h) Payment of Filing Fees and Costs The Debtors will pay all filing fees and other court costs incurred in connection with the prosecution of the Avoidance Actions. (i) Segregation of Funds The Unsecured Creditors' Committee will be required to segregate all funds received pursuant to the Avoidance Actions and maintain the funds in separate accounts. The Unsecured Creditors' Committee will also periodically report to the Debtors and the Principal Creditor Constituencies the amount and status of cash received on the Debtors' behalf in connection with the Avoidance Actions. The Debtors and the Principal Creditor Constituencies will have the right to inspect books and records. (j) Additional Investigation The Debtors and the Unsecured Creditors' Committee are currently investigating Transfers made to parties other than the Designated Transferees and the Former Executives. The Debtors and Committee reserve all rights concerning any and all Avoidance Actions with respect to other parties. The Additional Transfers include the Transfers made on account of asbestos claims. (Federal-Mogul Bankruptcy News, Issue No. 42; Bankruptcy Creditors' Service, Inc., 609/392-0900) FLOW INTERNATIONAL: July 31 Balance Sheet Upside-Down by $1.3MM --------------------------------------------------------------- Flow International Corporation (Nasdaq: FLOW), the world's leading developer and manufacturer of ultrahigh-pressure waterjet technology equipment used for cutting, cleaning (surface preparation) and food safety applications, reported results for its fiscal 2004 first quarter ended July 31, 2003. On a consolidated basis, FLOW reported fiscal first quarter revenues of $37.2 million and a net loss of $7.2 million. This compares to revenues of $40.0 million and a net loss of $4.0 million in the first fiscal quarter of 2003. The Flow Waterjet Systems segment reported revenues of $33.5 million and a net loss of $2.3 million or $0.15 diluted loss per share. The Avure Technologies segment recorded revenues of $3.7 million and a net loss of $4.9 million or $0.32 diluted loss per share. At July 31, 2003, the Company's balance sheet shows a total shareholders' equity deficit of about $1.3 million. "We continue to move in the right direction and make solid progress towards achieving our stated goals," said Stephen R. Light, Flow's President and Chief Executive Officer. "During the quarter, we concluded negotiations with our senior and subordinated lenders, entering into a new senior credit facility and amending our subordinated note agreement, which provides us the liquidity to continue our restructuring initiatives and rebuild this company based on its core strengths and return it to profitability. We passed some important milestones during the quarter by producing an operating profit in our Waterjet Systems business of $1 million, exclusive of $1.3 million in restructuring charges, and generating a consolidated $3.3 million in cash from operations." Credit Agreements On July 28, 2003, FLOW entered into a new credit agreement with its senior lenders, effective April 30, 2003 and expiring August 1, 2004. Also effective April 30, 2003, FLOW amended its subordinated note agreement covenants to match those in new credit agreement with its senior lenders. The subordinated lender has also agreed to capitalize the semi-annual interest remittances due from April 30, 2003 through April 30, 2004, totaling $6.9 million, as a component of the principal balance outstanding. As of July 31, 2003, FLOW was in compliance with all covenants under the new credit agreement and amended subordinated note agreement. Prior to signing these agreements, FLOW was in default of covenants under both agreements. Segment Review Waterjet Systems: For the quarter, Waterjet Systems reported revenues of $33.5 million and a net loss of $2.3 million or $0.15 diluted loss per share. Gross margins for Waterjet Systems increased from 29% of revenues in the year-ago quarter to 38% in the first fiscal quarter of 2004. The increase in margins is a result of improved overhead absorption, changes in revenue mix and stronger automotive and aerospace sales. Within the Waterjet Systems segment: -- Systems revenues increased 9% during the quarter to $20.9 million, based on improving economic conditions in the U.S. and in Europe. -- Consumables and spare parts revenues increased 7% to $12.5 million, resulting from increased machine utilization by Waterjet Systems' customers in Asia and associated higher parts consumption, as well as the recent introduction of proprietary productivity enhancing kits. -- Domestic shapecutting revenues increased 11% over the prior- year period, driven by stronger new system sales. FLOW's shapecutting business continues to outperform the domestic machine cutting tool market, which declined 11% during the same quarterly period (according to the Association for Manufacturing Technology), demonstrating the value customers place on the flexibility and increased machine performance of waterjets versus other technologies. -- Domestic revenues were further improved by an expansion of cutting cell applications to non-automotive customers, as well as an improvement in demand in the domestic automotive and aerospace sectors. -- Outside the United States, Waterjet Systems revenue growth was positively influenced by Asia, where revenues increased 29% compared to the prior-year quarter, driven largely by consumable sales in Japan. FLOW's European operations have been negatively impacted over the past several quarters by the continued slowing of the overall economy and weakening customer financial stability. In response, the company had put in place a new general manager, changed its pricing structure and accelerated payment terms. As a result of these actions, FLOW's European Waterjet Systems' revenues increased $0.4 million or 6% compared to the first fiscal quarter of 2003. Avure Technologies: For the quarter, Avure recorded revenues of $3.7 million and a net loss of $4.9 million. Within the Avure Technologies segment: -- General Press revenues declined 42% to $3 million from $5.2 million during the year ago quarter, primarily from decreased sales in Europe. General Press revenues vary from year to year due to the nature of their long sales and production cycles, which can range from one to four years. -- Avure's Fresher Under Pressure revenues decreased 83% to $0.7 million during the quarter. While Avure has continued to book food orders, many of the current orders will be filled with already completed systems. Accordingly, the company is only able to recognize revenues on these sales upon installation and customer acceptance, as opposed to over the manufacturing period. -- During the fourth fiscal quarter of 2003, the company announced that it had retained The Food Partners, LLC, an investment banking firm that specializes in the food industry, to develop and implement value-maximizing strategic alternatives for Avure. At July 31, 2003, FLOW had received several non-binding offers from potential buyers for its Avure segment; however no acceptable offer has been received. The company continues to evaluate alternative strategies, which include the continuation of operations in the present form, operations on a diminished scale, suspension of operations, shutdown, or a complete or partial divestiture. Flow provides total system solutions for various industries, including automotive, aerospace, paper, job shop, surface preparation, and food production. For more information, visit http://www.flowcorp.com GMAC COMMERCIAL: Fitch Affirms 6 Low-B/Junk P-T Certs. Ratings -------------------------------------------------------------- Fitch Ratings affirms the following classes of GMAC Commercial Mortgage Securities Inc.'s mortgage pass-through certificates, series 1998-C1. -- $132 million class A-1 'AAA'; -- $687.4 million class A-2 'AAA'; -- Interest only class X 'AAA'; -- $28.8 million class B 'AA+'; -- $64.7 million class C 'AA'; -- $75.5 million class D 'A'; -- $68.3 million class E 'BBB'; -- $43.1 million class F 'BBB-'; -- $32.4 million class G 'BB+'; -- $25.2 million class H 'BB'; -- $14.4 million class J 'B'; -- $25.2 million class K 'B-'; -- $14.4 million class L 'CCC'; -- $10.8 million class M 'CCC'. Fitch does not rate the $13 million class N. The rating actions follow Fitch's annual review of the transaction, which closed in May 1998. The rating affirmations are due to the stable overall pool performance. GMACCM, as master servicer, collected year-end 2002 operating statements for approximately 76% of the pool. The master servicer did not provide operating statements for the Senior Living Properties loan, the largest loan in the deal (16.6%), and is currently in bankruptcy. The weighted average debt service coverage ratio remains stable at 1.66 times. The SLP loan is a pool of health care properties and continues to be of concern. The borrowers filed for bankruptcy protection in May 2002. The loan remains current. It is backed by a surety, which has been guaranteed by Centre Solutions. Fitch closely monitors Centre's financial strength and, although it maintains an investment grade internal credit assessment, notices a recent deterioration. The surety's obligation is to advance all principal and interest payments, including the balloon payment, in full, upon default until the amount of the surety bond is reached. The surety can terminate its obligation (upon 60 days notice) by paying the trust the amount to defease. The surety has been making all debt service payments since November 2000. The internal assessment of Centre does not affect Fitch's assessment of the SLP loan, which remains well below investment grade since Fitch's 2000 annual review. The second largest loan of concern is Camlu Retirement Apartments (1.8%) which consists of multiple independent/assisted living properties. The borrower is working to sell the properties and has a signed letter of intent from the manager of the Texas facilities. Hypothetical stress scenarios were applied to the trust, where specially serviced and other loans that concerned Fitch as having the potential to become problematic were assumed to default. Even under these stress scenarios, the resulting subordination levels remain sufficient for our affirmations. Fitch will continue to monitor the SLP loan closely, as well as the other loans of concerns. HCA GENESIS: Signs-Up Lowenstein Sandler as Bankruptcy Counsel -------------------------------------------------------------- MGNH, Inc. and HCA Genesis, Inc., are seeking approval from the U.S. Bankruptcy Court for the Southern District of New York to employ Lowenstein Sandler, PC as Counsel. The Debtors need to retain Lowenstein Sandler to: a) provide to the Debtors legal services with respect to their powers and duties as debtors-in-possession in continuing the management of their property; b) prepare on behalf of the Debtors necessary applications, motions, complaints, answers, responses, orders, reports, and other legal papers; c) represent the Debtors in any matters involving contests with secured or unsecured creditors or other parties-in- interest; d) assist the Debtors in providing legal services required to prepare, negotiate and implement a plan of reorganization; and e) perform all other legal services for the Debtors which may be necessary herein. The Debtors tell the Court that engaging Lowenstein Sandler will enable them to properly perform their duties and functions as debtors-in-possession. Additionally, Lowenstein has extensive experience and knowledge in the field of debtors' protections, creditors' rights and business reorganizations under chapter 11 of the Bankruptcy Code. Kenneth A. Rosen, Esq., a director of the law firm of Lowenstein Sandler discloses that his firm will bill the Debtors in its current hourly rates of: Members of the Firm $285 - $525 per hour Senior Counsel $230 - $375 per hour Counsel $225 - $295 per hour Associates $140 - $250 per hour Legal Assistants $ 70 - $140 per hour Headquartered in Lake Katrine, New York, HCA Genesis, Inc., operates Health Care complexes. The Company filed for chapter 11 protection on September 5, 2003 (Bankr. S.D. N.Y. Case No. 03- 37132). When the Company filed for protection from it creditors, it listed $19,903,537 and debts of $22,015,702. ICG COMMUNICATIONS: W.R. Huff Discloses 19.3% Equity Stake ---------------------------------------------------------- As of August 12, 2003, certain separately managed accounts of W.R. Huff Asset Management Co., L.L.C., a Delaware limited liability company, have been issued, in the aggregate, approximately 912,810 shares of the common stock, par value $0.01 per share, of ICG Communications, Inc., a Delaware corporation, and warrants to purchase an aggregate of approximately 168,991 additional Shares (subject to adjustments in certain circumstances). In addition, the Accounts are to be issued, in the aggregate, approximately 395,760 Shares, and warrants to purchase an aggregate of approximately 118,102 additional Shares (subject to adjustments in certain circumstances). William R. Huff possesses sole power to vote and direct the disposition of all securities of the Company to be issued to, or on behalf of, and/or issued to, or on behalf of, the Accounts. Thus, for the purposes of Reg. Section 240.13d-3, William R. Huff is deemed to beneficially own approximately 1,595,663 Shares, or approximately 19.3% of the Shares deemed issued and outstanding as of that date. IMC GLOBAL: Will Participate in CSFB Conference on Wednesday ------------------------------------------------------------ IMC Global Inc. (NYSE: IGL) will participate in the Credit Suisse First Boston 2003 Chemical Conference in New York on Wednesday, September 17. The slide presentation by IMC Global Executive Vice President and Chief Financial Officer Reid Porter will take place from 3:45 p.m. to 4:15 p.m. EDT (2:45 p.m. to 3:15 p.m. CDT). The presentation will be Webcast live and via replay through the IMC Global Web site at imcglobal.com . Interested individuals should click on the Webcast announcement on the left side of the home page of IMC Global's Web site to be linked to the presentation page. Questions about the Webcast may be directed to IMC Global's Investor Relations department at 847.739.1817 or vbunker@imcglobal.com . With 2002 revenues of $2.1 billion, IMC Global (S&P, B+ Corporate Credit Rating, Stable) is the world's largest producer and marketer of concentrated phosphates and potash crop nutrients for the agricultural industry and a leading global provider of feed ingredients for the animal nutrition industry. IMMUNE RESPONSE: Receives $3.2MM via Class A Warrants Exercises --------------------------------------------------------------- The Immune Response Corporation (Nasdaq: IMNR) has received gross proceeds of approximately $3.2 million through the exercise of about 2.4 million Class A warrants in connection with the redemption of the warrants. The exercise of the warrants completes the first phase of the Company's plan to strengthen its financial position, which has improved with the receipt of more than $13 million in cash plus approximately $2.4 million debt reduction since March of this year. The next phase of the plan is expected to involve the exercise of the Company's Class B warrants. If all of the outstanding Class B warrants are exercised, the Company would receive gross proceeds of about $17 million. "We are pleased to have made such considerable progress toward financial stability over the past several months," said John N. Bonfiglio, Ph.D., Chief Executive Officer of The Immune Response Corporation. "In addition to raising cash and lowering our debt, we have appreciably reduced the administrative component of the burn rate, eliminated underutilized assets, and stopped internal work on projects unrelated to our lead product candidate. "We are now in a much improved position to focus on the continuing clinical development of REMUNE(R), a novel vaccine candidate for the treatment of HIV and AIDS," Dr. Bonfiglio stated. "REMUNE is currently being evaluated in a Phase II clinical study in Spain, and we intend to initiate an additional Phase II study in the fall of this year." The Company issued the Class A warrants in its December 10, 2002 private placement. Holders of Class A warrants whose warrants were exercised received one share of Common Stock and one Class B warrant which is exercisable for one share of Common Stock at an initial exercise price of $1.77. Holders of Class A warrants whose warrants were redeemed will receive $0.01 per Class A warrant. The Immune Response Corporation is a biopharmaceutical company dedicated to treating and preventing HIV and AIDS through the development of immune-based therapeutic vaccines such as REMUME, its lead product candidate. The Company was co-founded by medical pioneer Dr. Jonas Salk, who was instrumental in the formulation of REMUNE, which is currently in Phase II clinical development. HIV, the human immunodeficiency virus, is the virus that causes AIDS, a condition that slowly destroys the body's immune system, making it vulnerable to infections. REMUNE is designed to induce a specific immune response to the HIV virus. It is comprised of HIV-1 virus that has been chemically killed and inactivated so that it is non-infectious, plus an adjuvant that helps enhance the body's immune response to the virus. More than 60 million people have been infected with HIV since it was first recognized in 1981, and approximately 40 million people around the world are living with HIV today. * * * Liquidity and Going Concern In its Form 10-Q filed with the Securities and Exchange Commission, the Company reported: "The consolidated financial statements have been prepared assuming that the Company will continue as a going concern. The Company has operating and liquidity concerns due to historically reporting significant net losses and negative cash flows from operations. As of March 31, 2003 and December 31, 2002, the Company had a working capital deficiency of $2.4 million and working capital of $1.0 million, respectivley, and an accumulated deficit of $263.0 million and $257.8 million, respectively. "On March 28, 2003, we issued to Cheshire Associates, an affiliate of one of our directors and principal stockholder, Mr. Kevin Kimberlin, a short-term convertible promissory note in the amount of $2.0 million, bearing interest at the rate of 8% per annum. We anticipate that the proceeds from the issuance of the March Note will be sufficient to fund our planned operations, excluding capital improvements and new clinical trial costs, only through May 2003. The March Note is convertible into either 1,626,016 shares of our common stock at a price of $1.23 per share (which was the closing price of our common stock on March 27, 2003) or an equal amount of such other securities that the Company may offer in the future by means of a private placement to 'accredited investors.' On May 15, 2003, we issued to Cheshire Associates, an affiliate of one of our directors and principal stockholder, Mr. Kevin Kimberlin, a short-term convertible promissory note in the amount of $1.0 million, bearing interest at the rate of 8% per annum. We anticipate that the proceeds from the issuance of the May Note will be sufficient to fund our planned operations, excluding capital improvements and new clinical trial costs, only into early June 2003. The May Note has a convertible feature still to be determined in good faith negotiation prior to the 120 day maturity. "Notwithstanding the issuances of the March and May Notes, we will continue to have limited cash resources. Although our management recognizes the imminent need to secure additional financing and currently is negotiating with certain third parties the terms and conditions of potential financing transactions, including the private placement transaction described in the immediately preceding paragraph, there can be no assurance that we will be successful in consummating any such transaction or, if we do consummate such a transaction, that the terms and conditions of such financing will not be unfavorable to us. The failure by us to obtain additional financing before early June 2003, will have a material adverse effect on us and likely result in our inability to continue as a going concern. As a result, our independent auditors have concluded that there is substantial doubt as to our ability to continue as a going concern for a reasonable period of time, and have modified their report in the form of an explanatory paragraph describing the events that have given rise to this uncertainty regarding our 2002 annual consolidated financial statements. "These factors, among others, raise substantial doubt about the Company's ability to continue as a going concern. The consolidated financial statements do not include any adjustments relating to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities that might result should the Company be unable to continue as a going concern." IMPSAT FIBER: Kingdon Capital Discloses 7.54% Equity Stake ---------------------------------------------------------- Kingdon Capital Management, LLC, beneficially owns 753,984 shares of the common stock of IMPSAT Fiber Networks Inc., representing 7.54% of the outstanding common stock of the Company. Kingdon holds sole power to vote, or to direct the vote of, and sole power to dispose of, or to direct the disposition of, the entire 753,984 shares. Impsat Fiber Networks, Inc. is a leading provider of fully integrated broadband data, Internet and voice telecommunications services in Latin America. Impsat operates an extensive pan- Latin American high capacity broadband network in Brazil, Argentina, Chile and Colombia using advanced technologies, including IP/ATM switching, DWDM, and non-zero dispersion fiber optics. The Company has also deployed thirteen facilities to provide hosting services Impsat currently provides services to nearly 2,600 national and multinational companies, government entities and wholesale services to carriers, ISPs and other service providers throughout the region. The Company has local operations in Argentina, Colombia, Venezuela, Ecuador, Brazil, the United States, Chile and Peru. Visit http://www.impsat.com for more information on the Company. At March 31, 2003, the Reorganized Company's balance sheet shows that its total current liabilities outweighed its total current assets by about $300 million. INTERDENT INC: Court Confirms Prepackaged Plan of Reorganization ---------------------------------------------------------------- InterDent, Inc. (OTCBB: DENT) announced that the Federal Bankruptcy Court in Santa Ana, California, has confirmed the Company's Plan of Reorganization. InderDent had filed a Prearranged Plan of Reorganization under Chapter 11 of the U.S. Bankruptcy Code on May 9, 2003. With completion of this reorganization, InterDent will now exit Chapter 11 and become a private company. The restructuring reduces the Company's total debt by approximately $130 million, resulting from $90 million of debt being converted to equity and $39 million of convertible subordinated debt being extinguished. The remaining $38 million of senior debt is restructured into a three-year, market-rate term loan, leaving the Company with a debt to EBITDA ratio of approximately 2.0, which is very manageable. Additionally, the new equity holders are providing a $7.5 million revolving line of credit. H. Wayne Posey, chairman and chief executive officer of InterDent, said, "As evidence of the support that our Plan of Reorganization received, every class of creditors ended up voting to confirm the Plan. All of us at InterDent are very excited that the Company is now on solid footing with a stable capital structure. We now will be able to focus totally on our business and fulfill the promise of InterDent as a well-financed national leader in the dental industry." In closing, Mr. Posey said, "We are pleased with our progress, but hardly satisfied. The current economic environment is a continuing challenge, but I am confident we are up to the task. We've come this far because of the unwavering loyalty and support of our employees and affiliated dentists and their positive attitudes demonstrated time and again, especially during these past four months." InterDent provides dental management services in 135 locations in California, Oregon, Washington, Nevada, Arizona, Hawaii, Idaho, Oklahoma and Kansas with total annualized patient revenues under management of approximately $250 million. The Company's integrated support environment and proprietary information technologies enable dental professionals to provide patients with high quality, comprehensive, convenient and cost-effective care. JARDEN CORP: Acquires All Outstanding Shares of Lehigh Consumer --------------------------------------------------------------- On September 2, 2003, Jarden Corporation (S&P, B+ Corporate Credit Rating, Stable) acquired all of the issued and outstanding stock of Lehigh Consumer Products Corporation, the largest supplier of rope, cord and twine for the U.S. consumer marketplace and a leader in innovative storage and organization products for the home and garage, as well as products in the security door and fencing market. Its customers include North America's largest and rapidly growing warehouse, home centers and mass merchants. Jarden acquired Lehigh pursuant to the terms of a Stock Purchase Agreement dated August 15, 2003, between Jarden Corporation, American Manufacturing Company, Inc., and Lehigh. The consideration for this acquisition consisted of the following: $155 million in cash paid at closing (excluding transaction costs); and an Earn-Out provision with a potential payment in cash or Jarden's common stock, at Jarden's election, of up to $25 million payable in 2006. If the Earn-Out is paid, Jarden expects to capitalize its cost. If the Company issues stock in satisfaction of the Earn-Out, the value of each share will be determined by taking the average of the closing price of Jarden's common stock on the New York Stock Exchange over a period consisting of the ten consecutive business days ending on the date that is two days prior to the issuance of such stock. Jarden has entered into a Registration Rights Agreement, dated September 2, 2003, with AMC, pursuant to which the Company has agreed to file a registration statement with respect to the resale under the Securities Act of 1933, as amended, of shares issued in satisfaction of the Earn-Out. This acquisition was financed at closing with the combination of Jarden's available cash and borrowings under its credit facility, which the Company has amended and restated to increase its available borrowings. On September 2, 2003, Jarden refinanced its existing senior indebtedness by closing on an amendment and restatement to its existing credit facility pursuant to the Amended and Restated Credit Agreement, dated September 2, 2003, between Jarden Corporation, Bank of America, N.A., as Administrative Agent, Swing Line Lender, and L/C Issuer, Canadian Imperial Bank of Commerce, as Syndication Agent, National City Bank of Indiana and Fleet National Bank, as Co-Documentation Agents, and the other Lenders party thereto. The Company's Amended and Restated Credit Agreement, among other things, provides for a senior credit facility for up to $280 million of senior secured loans, consisting of a $70 million five- year revolving credit facility, a $60 million five-year term loan facility, and a new $150 million five-year term loan facility. The Revolving Credit Facility includes up to an aggregate of $15 million in standby and commercial letters of credit and up to an aggregate of $10 million in swing line loans. As of September 2, 2003, Jarden has not drawn any amounts under the Revolving Credit Facility. It has used an amount of approximately $7.1 million of availability under the Revolving Credit Facility for the issuance of letters of credit. As of September 2, 2003, $54.5 million was outstanding under the Term Loan A Facility. Payments of principal under the Term Loan A Facility are payable quarterly in accordance with a specified amortization schedule. The final payment of all amounts outstanding under the Term Loan A Facility is due on April 24, 2007. On September 2, 2003, the Company drew down the full amount of the $150 million Term Loan B Facility. These funds were used principally to pay the cash consideration for the Lehigh acquisition under the Stock Purchase Agreement. Payments of principal under the Term Loan B Facility are payable quarterly in accordance with a specified amortization schedule. The final payment of all amounts outstanding under the Term Loan B Facility is due on April 24, 2008. The Revolving Credit Facility, the Term Loan A Facility and the Term Loan B Facility bear interest at a rate equal to (i) the Eurodollar Rate (as determined by the Administrative Agent) pursuant to an agreed formula or (ii) a Base Rate equal to the higher of (a) the Bank of America prime rate and (b) the federal funds rate plus 0.50%, plus, (x) for loans under each of the Revolving Credit Facility and the Term Loan A Facility, an applicable margin ranging from 0.75% to 1.75% for Base Rate loans and from 2.00% to 2.75% for Eurodollar Rate loans, and (y) for loans made under the Term Loan B Facility, 2.75% per annum with respect to Eurodollar Rate loans and 1.75% per annum with respect to Base Rate loans. Interest under the Revolving Credit Facility, the Term Loan A Facility and the Term Loan B Facility are payable quarterly if a loan is a Base Rate loan or on a date which is one, two or three months from the date of disbursement, as selected by the Company, if the loan is a Eurodollar Rate loan; provided, that for six-month Eurodollar Rate loans, interest shall be paid quarterly. LASERSIGHT INC: Case Summary & Largest Unsecured Creditors ---------------------------------------------------------- Lead Debtor: LaserSight Incorporated 6903 University Blvd. Winter Park, Florida 32792 Bankruptcy Case No.: 03-10371 Debtor affiliates filing separate chapter 11 petitions: Entity Case No. ------ -------- LaserSight Patents, Inc. 03-10369 LaserSight Technologies, Inc. 03-10370 Type of Business: Manufacturer of ophthalmic medical equipment Chapter 11 Petition Date: September 5, 2003 Court: Middle District of Florida (Orlando) Judge: Arthur B. Briskman Debtors' Counsel: Frank M. Wolff, ESq. Wolff, Hill, Mcfarlin & Herron, P.A 1851 W. Colonial Drive Orlando, FL 32804 Tel: 407-648-0058 Total Assets: $20,564,200 Total Debts: $11,664,021 A. LaserSight Inc.'s 20 Largest Unsecured Creditors: Entity Nature Of Claim Claim Amount ------ --------------- ------------ Luis A. Ruiz, MD and $3,471,612 Sergio Lenchig Calle 120 No. 20A-44 Apartment 401 Santale de Bogota, Colombia South America The Lowenbaum Partnership, LLC $256,867 222 South Central Avenue Suite 901 St. Louis, MO 63105 Sonnenschein Nath & Rosenthal $199,361 KPMG LLP (Unit US230) $172,249 The Realty Associates Fund III $55,539 Christensen & Associates $26,939 The Nasdaq Stock Market, Inc. $18,000 McColl Partners LLC $10,000 Dean, Mead $9,119 Pitney, Hardin, Kipp & Szuch $6,706 AON Risk Services of Missouri $5,960 American Express $5,304 KPMG, LLP (Unit 194) $4,740 Trancentive $4,050 American Stock Trans & Trust $3,021 AST Stockplan - Smithbarney $3,000 BISYS Qualified Plan Services $1,864 Master Benefit Group, Inc. $1,438 PR Newswire, Inc. $1,218 CT Corporation System $1,120 B. LaserSight Technologies' 20 Largest Unsecured Creditors: Entity Claim Amount ------ ------------ King, Angela $328,708 8901 Jonathan Manor Drive Orlando, FL 32819 Roper & Quigg $224,885 Manelli, Denison & Selter $207,982 Tui Lasertechnik $199,616 Becton Dickinson $118,729 SACOR $102,851 Visiontech Medical Optics $102,396 Morris, Nichols, Arsht & Tun $94,994 Fabricant, Robert N. $50,000 AT&T - Uniplan Service $43,096 Quantum Technology $41,528 Preferred Benefit $41,046 Center for Clinical Research $40,500 AIT Freight Systems $39,641 Astec, Inc. $28,126 Lambda Research Optics, Inc. $26,038 Avvocati Associati $25,490 Specira Gases $20,941 Expertech Associates, Inc. $20,833 Consultronix - Poland $18,679 LEVI STRAUSS: Will Publish Third Quarter Results by Month-End ------------------------------------------------------------- Levi Strauss & Co. reported preliminary third-quarter results, including sales and net income increases, and announced additional initiatives to improve its competitiveness, including bringing products to market faster and more frequently, restructuring its U.S. and European businesses and reducing operating expenses. The company released estimated financial results for its third quarter, ended Aug. 24, 2003, in anticipation of the syndication of a new financing arrangement. Final results for the third quarter will be released on Sept. 30, 2003 and discussed during the company's investor conference call, which can be accessed through its Web site at http://www.levistrauss.comat 7 a.m. PDT (10 a.m. EDT). "On balance, I'm pleased with what we achieved in the third quarter. Our results were consistent with the expectations we laid out at the start of the quarter," said chief executive officer Phil Marineau. "Importantly, sales and profits were up, fueled by the successful launch of our new Levi Strauss Signature(TM) brand into 3,000 U.S. Wal-Mart stores. Initial consumer sell-through has been very good. As the summer drew to a close and the important back-to-school season kicked into gear, sell-through at retail for our Levi's(R) and Dockers(R) brands in the United States also accelerated. Additionally, our Asia business turned in another quarter of strong growth. At the same time, our European business continues to be difficult. "We continue to be faced with tough economic environments worldwide and persistent price deflation in the apparel industry. In the United States, it's been reported to be the worst apparel deflation since the Depression, and it's not going away," added Marineau. "We're addressing the business environment by continuing to streamline our go-to-market process -- from product design right through to delivery -- to make it even more responsive and efficient. We're taking complexity and cost out of the entire organization. And we're putting new financing in place, which will allow us to transform the company faster." Third-Quarter Preliminary Results and Guidance The company estimates third-quarter net sales to be between $1,078 million and $1,085 million, a 6 percent to 7 percent increase over 2002 third-quarter sales of $1,018 million. On a constant-currency basis, net sales are estimated to increase approximately 2 percent to 3 percent for the period. Operating income for the quarter is expected to be between $95 million and $100 million, versus $96.7 million for the same period a year ago. Net income is anticipated to come in between $24 million and $28 million, versus $13.7 million in the third quarter of 2002, a 75 percent to 104 percent increase. At the end of the third quarter 2003, total debt was estimated to be $2.37 billion compared to $2.31 billion as of May 25, 2003 and $1.85 billion as of the fiscal year ended Nov. 24, 2002. The company reaffirmed that it expects full-year sales to be essentially flat with 2002, plus or minus 2 percent, on a constant-currency basis. Operating margin, excluding restructuring charges, net of reversals and related expenses, is expected to be in the range of 8 to 10 percent for the year, consistent with previous guidance. Additionally, net debt at the end of 2003 is expected to be up approximately $300 million from year-end 2002, also consistent with previous guidance. "As we look ahead to next year, we're not anticipating any significant improvements in the deflationary pressures we're experiencing at retail. Our preliminary expectations for 2004 are for full-year growth in the low to mid-single digits," said chief financial officer Bill Chiasson. "We anticipate that our operating margin, excluding restructuring charges, net of reversals and related expenses, will be approximately the same as 2003, with some possible improvement given the cost reductions under way. We expect net debt levels to come down slightly, by no more than $100 million by the end of 2004." Organizational Changes "In line with improving our go-to-market process, we are restructuring our U.S. business," said Marineau. "We expect to have a much more integrated, flexible and leaner organization that delivers consumer-relevant products with greater speed and frequency. As we simplify our business processes and reduce our operating expenses, we expect to eliminate up to 350 salaried positions in the U.S. business this year. "Additionally, our European business, based in Brussels, recently presented a proposal to the European and appropriate national Employee Councils to improve our competitiveness through a similar restructuring program that streamlines the work and reduces the time it takes to get new products on the shelf," said Marineau. "If the proposal is confirmed, we would eliminate up to 300 jobs. "As necessary as these restructuring actions are, it is still painful to see people who have done a tremendous job leave the company," said Marineau. Estimated Costs and Savings Should these proposed organizational changes be executed, the company estimates the total pre-tax restructuring charges and related expenses would be $70 million to $80 million. Most of these costs are expected to be incurred and paid by the end of 2004. Annual savings from these proposed actions and other cost reduction efforts are expected to be between $130 million and $150 million. Refinancing The company has appointed Bank of America, N.A. and Banc of America Securities LLC to lead a new $1.15 billion financing arrangement consisting of a $650 million asset-based revolving credit facility, maturing in 2007, and a $500 million senior secured term loan, maturing in 2009. This new financing would replace the company's existing senior secured credit facility consisting of a $375 million revolver and $365 million term loan, as well as $110 million of debt arranged under an accounts receivables securitization. "We believe our new financing arrangement will give us the financial flexibility we need to pursue our restructuring plans as soon as possible," said Chiasson. "Additionally, we expect this new agreement to provide us with greater liquidity and extended maturity dates, which will improve our debt structure. Due to the difficult environment, we cannot be sure that we will remain in compliance with all of the financial covenants set forth in our existing credit facility, and we believe it is appropriate to seek a temporary waiver that we expect to remain in place until the new financing is finalized." Bank of America, Banc of America Securities and LS&CO. are launching the financing this week and expect to complete it within several weeks. Completion is subject to, among other things, negotiation and execution of definitive documents and satisfaction of closing conditions. Levi Strauss & Co. (Fitch, BB- Secured Bank Facility and B Senior Unsecured Debt Ratings, Negative) is one of the world's leading branded apparel companies, marketing its products in more than 100 countries worldwide. The company designs and markets jeans and jeans-related pants, casual and dress pants, shirts, jackets and related accessories for men, women and children under the Levi's(R), Dockers(R) and Levi Strauss Signature(TM) brands. LEVI STRAUSS: Corporate Credit Rating Dives Down 2 Notches to B --------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on apparel maker Levi Strauss & Co., including its corporate credit rating to 'B' from 'BB-'. The outlook is stable. San Francisco, California-based Levi Strauss has about $2.3 billion of rated debt. "The rating action follows Levi Strauss' announcement that the company will seek a temporary waiver under its existing credit facility as it finalizes a new $1.15 billion refinancing of its current secured bank credit facility and accounts receivable securitization program. Year-to-date results have been well below expectations because of a weak economic environment and continued apparel price deflation, which will likely continue for the foreseeable future," said credit analyst Jayne M. Ross. Although, the rollout of the Signature product line at Wal-Mart Stores Inc. seems to be going according to plan, it will not be sufficient in the near term to offset the current difficulties at retail and in Levi Strauss' European business. In addition, Levi Strauss announced the proposed restructuring of its U.S. and European operations to address the changing business environment, which would result in pretax cash charges and expenses in the $70 million to $80 million range. It is expected that most of these expenses will be incurred in 2004 if completed. The proposed savings from the restructuring and cost-saving initiatives are expected to be between $130 million and $150 million. Standard & Poor's believes that in the longer term, the restructuring initiatives will assist the company in becoming a more nimble operator. The ratings reflect Levi Strauss' leveraged financial profile and its participation in the highly competitive denim and casual pants industry. The ratings also reflect the inherent fashion risk in the apparel industry. This is somewhat offset by the company's well-recognized brand names in jeans and other apparel. LTV CORP: Move to Terminate & Replace Benefit Plans Draws Fire -------------------------------------------------------------- David M. Fusco, Esq., at Schwarzwald & McNair LPA, in Cleveland, Ohio, represents the United Steelworkers of America AFL-CIO-CLC, a party to collective bargaining agreements with Miami Acquisition Company and Copperweld Tubing Products Company. Mr. Fusco argues that the Copperweld Debtors' request is premature. The Debtors and the USWA have entered into "preliminary discussions" concerning the status of the two defined benefit plans maintained as required by postpetition collective bargaining agreements with the USWA, the Pension Plan for Miami Hourly Employees sponsored by Miami, and Copperweld Corporation Copperweld Shelby Division Pension Plan for Production and Maintenance Employees, sponsored by CPTC. Those discussions, and the sharing and review of complex economic and actuarial information, is continuing. There has been no break down in discussions. In addition, Mr. Fusco asserts that the plans at issue cannot be terminated, absent the agreement of the USWA and the PBGC. According to Mr. Fusco, the ultimate approval of any distress termination lies with the Pension Benefit Guaranty Corporation, and the PBGC will not proceed with a distress termination, where there is an unresolved formal challenge by a union to a termination. It is inappropriate and wasteful of the time and efforts of the parties and the Court to precipitate a premature contested hearing, as well as hardening of the parties' position, when the parties are engaged in the sharing of information and efforts to determine if a consensual resolution is possible. The USWA wants the Court to adjourn the hearing on the Copperweld Debtors' request. In the absence of an adjournment, the USWA insists that the Copperweld Debtors' request should be denied for reasons including the Debtors' failure to meet, or even attempt to meet, the requirements for a distress termination for the plans. The PBGC will not approve the Debtors' request for a distress termination in the absence of a consensual resolution of any USWA grievances or a final resolution of the grievances holding that the termination does not violate the CBA. Section 4041(a)(3) of ERISA provides that the PBGC will not proceed with a distress termination if such termination would violate the terms of an existing collective bargaining agreement. The PBGC has promulgated extensive interpretive regulations for Section 4041(a)(3) directing this. The regulations provide that if the PBGC is notified during the relevant period that a formal challenge to the termination has been initiated under an existing collective bargaining agreement, which includes a contractual grievance, the PBGC will suspend its internal termination proceedings. The suspension continues through final resolution of the challenge. If the challenge is upheld, the PBGC will dismiss the termination proceedings. The regulations define a "formal challenge" as: (c) Formal challenge to termination. A formal challenge to a plan termination asserting that the termination would violate the terms and conditions of an existing collective bargaining agreement is initiated when -- (1) Any procedure specified in the collective bargaining agreement for resolving disputes under the agreement commences; or (2) Any action before an arbitrator, administrative agency or board, or court under applicable labor management relations law commences. The regulations define "final resolution of a challenge" as including as settlement or an award or decision. If the final resolution is a non-appealable determination that the termination does not violate a collective bargaining agreement, or a settlement, the PBGC will reactivate the termination proceedings. Any grievances by the USWA would clearly be formal challenges to the termination, as it is a process under a procedure specified in the collective bargaining agreement for resolving disputes under the CBA. Therefore, regardless of the Court's decision on the Debtors' request for a determination of the financial requirements for a distress termination, a termination will not be processed by the PBGC absent a consensual resolution with the USWA or a final resolution of any grievances holding that the termination does not violate the CBA. ERISA establishes very strict criteria for approval of the financial requirements for a distress termination. The Court must determine that "unless the plan is terminated, such person [Copperweld] will be unable to pay all its debts pursuant to a plan of reorganization and will be unable to continue in business outside a Chapter 11 reorganization process" and approve the termination. The PBGC takes the position, and the USWA agrees, that in order to comply with the statute, the Court must make a "but for" determination, i.e., but for the termination the Debtor will be unable to pay all its debts pursuant to a Chapter 11 plan of reorganization and will be unable to continue its business outside a Chapter 11 reorganization process. There must be the required standard of evidentiary proof concerning the financial requirements for each pension plan's funding as well an analysis of the Debtors' proposed plan of reorganization, and any other possible plan, in relation to the funding requirements of each defined benefit plan. It is not at all clear that termination of each USWA-negotiated and maintained defined benefit plans is necessary for the Copperweld Debtors to reorganize. The Debtors must show definitive proof that funding for the plan of reorganization and beyond will not be available, looking at all members of the controlled group, absent termination of each plan. 2) Pension Benefit Guaranty Corporation The PBGC, represented by Nathaniel Rayle, Esq., standing in for James J. Keightley, Esq., General Counsel in Washington, notes that there has been little or no basis for interested parties, including PBGC, to investigate the basis for Copperweld's allegations regarding its finances. PBGC asks Judge Bodoh to defer any ruling on the Debtors' request until parties-in-interest have had a reasonable opportunity to take discovery relating to: (i) the alleged expense of the Pension Plans; (ii) the alleged inability of Copperweld to fund those plans going forward; and (iii) the characteristics and funding of any new pension plans instituted by Copperweld. PBGC is the federal agency and wholly owned United States government corporation that administers the defined benefit pension plan termination insurance program established by Title IV of ERISA. When a pension plan covered by Title IV terminates without sufficient assets to pay all of its promised benefits, PBGC typically becomes trustee of the plan and pays plan participants their pension benefits up to the statutory limits. Title IV of ERISA provides the exclusive means for termination of single-employer pension plans. A plan sponsor can terminate a pension plan in a standard termination under 29 U.S.C. 1341 (b) if the plan has sufficient assets to pay all benefits owed to the plans' participants, or through a distress termination under 29 U.S.C. 1341(c) if the plan does not have sufficient assets to cover all of its benefit liabilities. Under the distress termination provisions, a pension plan may terminate only if: (1) the plan administrator provides affected parties, including PBGC and plan participants, at least 60-day advance written notice of its intent to voluntarily terminate the pension plan; (2) the plan administrator provides PBGC with the information set forth in 29 U.S.C. 1341(c)(2)(A); and (3) PBGC determines that the requirements of 29 U.S.C. 1341(c)(2)(B) have been met. PBGC cannot proceed with a distress termination if such termination would violate the terms and conditions of an existing collective bargaining agreement. Accordingly, if the agency is advised of a formal challenge to plan termination under the aegis of a CBA, PBGC must suspend the termination proceeding. In the Copperweld Debtors' case, two of the three Pension Plans are maintained pursuant to a collective bargaining agreement with the USWA. PBGC has not yet been notified of a formal challenge to the termination. If and when a pension plan terminates, the plan sponsor and each member of its controlled group' are jointly and severally liable for the plan's unfunded benefit liabilities, as well as for any unpaid minimum funding contributions and unpaid premiums. PBGC has timely filed claims for these pension obligations. The claims for unfunded benefit liabilities are contingent on the termination of the relevant pension plan. ERISA sets forth several tests for determining whether a pension plan may be terminated in a distress termination. Copperweld seeks to terminate the Pension Plans under the "Reorganization in Bankruptcy" test. Under this test, a bankruptcy court is called upon to make a factual determination whether a debtor "will be unable to pay all of its debts pursuant to a plan of reorganization and will be unable to continue in business outside the chapter 11 reorganization process," unless the pension plan is terminated. The bankruptcy court must make the requisite findings as to each debtor controlled group member. It is then incumbent upon PBGC to determine whether the contributing sponsor and each member of the sponsor's controlled group satisfy the other criteria for a distress termination of the pension plan. As one court stated: [T]he Court does not find itself faced with the ultimate question of the Debtor's entitlement to the termination of its pension plan. Instead, the Court simply must perform one narrow factual determination, the satisfaction of which will compose a single element in the Debtor's individual case for reorganizational "distress." The ultimate sufficiency of that distress showing, as well as the adequacy of the Debtor's required disclosures and the qualifications of any "controlled group" parties, then will become a collective matter for the PBGC's consideration as it makes a final determination of the Debtor's right to a distressed termination. The Court should scrupulously examine Copperweld's finances and circumstances so as to enable it to make the necessary determinations to meet ERISA's strict criteria for distress terminations." One court has found that in a distress termination, "the appropriate standard of review . . ., pursuant to Section 1341(c)(2)(B)(ii), is whether but for distress termination, the Debtor will not be able to pay its debts when due, [nor] continue in business." Thus, a bankruptcy court's factual determination should be based not simply on a debtor's self-serving representations that it is financially strapped, but upon reliable evidence that establishes that plan termination is the only way that the debtor will be able to reorganize and continue in business outside the Chapter 11 reorganization process. Put another way, a bankruptcy court should inquire whether a debtor will be unable to pay its debts and continue in business under any plan of reorganization, because Section 1341 (c)(2)(B)(ii)(IV) qualifies a debtor's ability to pay in terms of "a" plan of reorganization, not just the particular plan of reorganization that it has proposed. ERISA's legislative history also provides guidance as to the appropriate role of a bankruptcy court in distress terminations. Congress significantly changed the termination requirements for pension plans in 1986 and 1987. Before these amendments, a plan sponsor could terminate a pension plan for any reason. Congress enacted the distress termination provisions as part of the Single Employer Pension Plan Amendments Act of 1986. The legislative history shows that "[t]he basic policy of the legislation is to limit the ability of plan sponsors to shift liability for guaranteed benefits onto other PBGC premium payers and to avoid responsibility for the payment of certain non-guaranteed benefits, to cases of severe business hardship." A year later, the Pension Protection Act further clarified the distress criteria by adding the stringent language of the current "Reorganization in Bankruptcy" test. To determine whether Copperweld satisfies the financial distress requirement of the distress termination test, the Court should adjourn the hearing until the PBGC, and any other party-in- interest, has had a fair opportunity to take discovery and thereby flesh out some of the Debtors' conclusory allegations. The Court may be interested to know such things as: * the financial feasibility of terminating fewer than all of the Pension Plans; * the projected costs of each of the Pension Plans using different actuarial assumptions or cost methods; * other areas of cost savings that may be available to the Debtors, areas in which cost savings have been realized, and in what amounts; * as to each Pension Plan, the effect of minimum funding waivers -- if granted by the IRS -- or the freezing of benefit accruals on the relative affordability of the plan; and * as to each Pension Plan, the cost to provide all benefits and close out the plan in a standard termination. The PBGC has submitted interrogatories and document requests to Copperweld and may also take the depositions of certain key persons. Copperweld says that it is ready and willing to respond to those discovery requests to try to establish that it satisfies the financial distress criterion that ERISA commits to the Court's sound judgment. Moreover, the PBGC observes that little is known about the Debtors' Replacement Plans -- they do not yet exist and PBGC knows nothing about their proposed terms. Replacement plans implicate PBGC's policy regarding abusive follow-on plans -- if an employer adopts a new plan that, together with the guaranteed benefits paid by the PBGC under the terminated plan, provides for the payment of, accrual of, or eligibility for benefits that are substantially the same as those provided under the terminated plan, the PBGC will view the new plan as an attempt to shift liability to the termination insurance program while continuing to operate the plan, which is an abuse of the program. Copperweld's proposed Replacement Plans require a detailed analysis of the underlying facts to assure that the Debtors are not in effect getting a government subsidy of continuing pension plans under the guise of terminating those plans. PBGC's ultimate approval of termination of any of the Pension Plans may well hinge on the agency's non-objection to the Replacement Plans. 3) John N. Digiacomo According to Robert C. Lucas, Esq., in Elizabeth, Pennsylvania, Mr. Digiacomo "wishes to retain all benefits at their current levels." (LTV Bankruptcy News, Issue No. 54; Bankruptcy Creditors' Service, Inc., 609/392-00900) MAXXIM MEDICAL: Inks Pact to Sell Assets to Lightyear Capital ------------------------------------------------------------- Maxxim Medical, Inc., which filed for bankruptcy protection in February 2003, has signed an agreement for the sale of substantially all of its assets and business to Lightyear Capital, a private equity investment firm that manages more than $2 billion in assets. Maxxim Medical is a leading manufacturer, assembler and marketer of specialty medical products such as custom procedure trays, medical and surgical gloves, radiology, and critical care products for hospitals, surgery centers and alternate care facilities. Thomas R. Cochill, Maxxim president and chief executive officer, noted the importance of the proposed acquisition to the company: "Partnering with Lightyear Capital, and tapping into their resources and expertise, is a positive step for Maxxim, our employees, customers and the companies that provide goods and services to Maxxim. We anticipate that this action should result in a new Maxxim that will be a stronger competitor in the marketplace, serving our markets even more effectively in the years to come." Donald B. Marron, chairman and chief executive officer of Lightyear Capital, said, "Maxxim has the attributes that our firm looks for - a strong presence in its core markets, excellent management and a solid, long-term business plan for growth. We look forward to supporting the company and its management as they capitalize on emerging growth opportunities within their markets." The purchase agreement for Maxxim's assets and those of several related subsidiaries is subject to approval by the U.S. Bankruptcy Court for the District of Delaware as well as compliance with the Bankruptcy Code and certain other conditions. The sale is also subject to the consent of the secured lenders under Maxxim's debtor-in-possession financing facility. The financial terms of the deal were not disclosed. Maxxim anticipates the closing of the sale should occur by the end of October 2003. Based in Oldsmar, Fla., Maxxim Medical -- http://www.maxximmedical.com-- is a major diversified manufacturer, assembler and marketer of specialty medical and surgical products, including custom and standard procedure trays, single use drapes and gowns, medical and surgical gloves, vascular access and critical care products. Selling primarily to acute care hospitals, surgery centers and alternate care facilities, Maxxim has five plants in the United States and one in the Dominican Republic. U.S. plants are located in Athens, TX; Clearwater and Oldsmar, FL; Columbus, MS; and Honea Path, SC. Lightyear Capital is a private equity investment firm based in New York City that manages approximately $2 billion in assets, including The Lightyear Fund, a $750 million private equity fund. The Lightyear Fund invests in leveraged buyout, recapitalizations, and growth capital opportunities in financial services and other selected industries in North America and Europe. Lightyear's approach to investing centers on partnering with skilled management teams who lead quality companies with significant potential for growth, either organically or through acquisitions. MERA PHARMACEUTICALS: Red Ink Continued to Flow in Third Quarter ---------------------------------------------------------------- Mera Pharmaceuticals, Inc. (OTC Bulletin Board: MRPI) has released its financial results for its third fiscal quarter, ended July 31, 2003. The results show a continued narrowing of operating losses, both year to year and sequentially. The loss from operations for third quarter 2003 fell to $178,000 versus a loss of $499,000 for the same quarter in 2002, a 64% improvement. Relative to the second quarter of 2003, when the Company had a loss from operations of $406,000, the improvement was a still very strong 56%. Daniel Beharry, who took over as Mera's CEO in July, noted that the improvement was due to both increasing revenues and decreased expenses. "Our revenues improved in all three categories -- product sales, contract services and royalties. Revenues of $656,000 year-to-date nearly match the $662,000 total for all of 2002. In addition, the third quarter was the first full quarter during which our cost-cutting program was in effect. As a result, our general and administrative expense fell from $312,000 for second quarter of 2003 to just $173,000 for the third quarter, a reduction of 44%. A comparison to the G&A expenses of $544,000 for the first quarter of 2003 is even more impressive, reflecting a reduction of nearly 68%. The benefits from that cost control effort are apparent and ongoing." Mr. Beharry continued, "We completed the Chapter 11 reorganization of Mera less than a year ago, and while the Company still faces some challenges, the continued progress shown by these results is encouraging. We believe there is a lot of room for improvement still on our production efficiency, which will help to increase margins. However, the key to success is a continued increase in revenues. To accomplish that we have increased our sales and marketing efforts to support sales of our AstaFactorr product, including the launch of a television, radio and print advertising campaign in Hawaii during the third quarter and the increase in our advertising for the Southern California market. We also have three new products in the planning stage, all of which should be in test production by the first calendar quarter of 2004, if not sooner. "Another focus is extending our distribution to international markets. We are engaged in discussions now with several parties seeking distribution rights for AstaFactor(R) in markets where margins and receptivity both tend to be higher. That work is in addition to efforts to expand distribution domestically through private label opportunities. "Each of these initiatives is designed to strengthen our product and revenue base. There will be some upfront costs associated with them, but our expectation is that by bearing those costs now we will prepare the company to make progress toward profitability in the future." Mera Pharmaceuticals, Inc., based in Kona, Hawaii, and Solana Beach, California, is focused on identifying and producing valuable products from natural sources. Mera's patented technology and proprietary processes give it a significant advantage in exploiting the rich, untapped resource of microbial aquatic plants, long recognized for their potential medical and nutritional value. Mera's first nutraceutical product, the AstaFactor(R), is a concentrated source of natural astaxanthin, found in a number of fish and seafood species. Astaxanthin is proven to be an extremely powerful antioxidant and an effective anti-inflammatory. * * * Going Concern Uncertainty In it Form 10-QSB filed with the Securities and Exchange Commission, Mera Pharmaceuticals reported: "The [Company's] financial statements have been prepared assuming that the Company will continue as a going concern. The Company has operating and liquidity concerns, has incurred an accumulated deficit of $2,121,508 through the quarter ended July 31, 2003 and current liabilities exceeded current assets by $683,629. The Company anticipates that future revenue will be sufficient to cover certain operating expenditures and, in the interim, will continue to pursue additional capital investment. However, there can be no assurance that the Company will be able to acquire the necessary capital to achieve a level of sales that will permit it to operate on the basis of revenues alone. These factors, among others, create an uncertainty about the Company's ability to continue as a going concern." MICRO WAREHOUSE: Ingram Micro Discloses $20 Million Exposure ------------------------------------------------------------ Ingram Micro Inc. (NYSE: IM) expects to record a third-quarter charge of up to $20 million (approximately $13 million net of tax) related to accounts receivable from Micro Warehouse, Inc., which the company believes are substantially impaired after Micro Warehouse's sale of certain assets to CDW Corporation in a transaction that was announced Monday and its subsequent Chapter 11 filing in the U.S. bankruptcy court Tuesday. "Micro Warehouse was one of our larger North American customers, with North American revenues of approximately $75 million for the second quarter of 2003, outstanding accounts receivable of approximately $25 million and related allowances for bad debt of approximately $5 million," said Thomas A. Madden, executive vice president and chief financial officer, Ingram Micro Inc. "We had been working closely with Micro Warehouse and had established reserves based on available information, including business plans, financial information and management representations provided to us by Micro Warehouse. However, after Monday's announced transaction and Tuesday's bankruptcy filing, we now believe that the receivables have been substantially impaired. We intend to pursue all potential recovery options." The company also currently has outstanding receivables of approximately $12 million from Micro Warehouse's European operations, which were not affected directly by Micro Warehouse's announced sale of assets to CDW Corporation or Tuesday's U.S. bankruptcy filing. "We believe that the risk associated with the collection of the European receivable is negligible," said Madden, "in light of our understanding of the financial condition of the Micro Warehouse European operations and our credit insurance coverage. We will continue to monitor the situation and will take appropriate measures if anything changes." The per-share impact of the charge could be as much as $0.09 for the third quarter ending Sept. 27, 2003, which was not anticipated in the company's guidance issued on July 30, 2003 and reconfirmed on Sept. 3, 2003. The company's adjusted guidance for the fiscal quarter ending Sept. 27, 2003, assuming the full pre-tax $20 million charge is recorded, is as follows: -- Sales are expected to range from $5.175 billion to $5.350 billion, with net income excluding major-program costs or other special items ranging from $8 million to $12 million or $0.05 to $0.08 per diluted share. As the world's leading IT distributor, Ingram Micro is the best way to get technology from the people who make it to the people who use it. Visit http://www.ingrammicro.com/corp MIKOHN GAMING: Evaluating Options to Recapitalize Balance Sheet --------------------------------------------------------------- Mikohn Gaming Corporation (NASDAQ: MIKN), is evaluating various strategies to recapitalize its balance sheet, although no firm plans are in place to implement any of these alternatives at the current time. Currently the Company has approximately $105.0 million of long- term debt (approximately $101 million net of unamortized discounts) outstanding due August, 2008. The Company's long-term debt carries an interest rate of 11.875 percent per annum, requiring annual interest payments of approximately $12.5 million. In addition, the Company announced that for the third quarter ended September 30, 2003, revenue is expected to be in the range of $19.0 million to $22.0 million, and loss per share are expected to range from $0.18 to $0.35. Russ McMeekin, President and Chief Executive Officer stated, "While we have made substantial progress in implementing our new business model which focuses on the licensing of game content versus hardware intensive manufacturing, full realization of our transition will not occur as quickly as we had previously anticipated. We are seeing increased market acceptance of our new robust Mikohn Matrix platform and will be previewing at next week's G2E Gaming Exposition, our exciting new product offerings." Mikohn (S&P, B- Corporate Credit and Senior Unsecured Debt Ratings, Negative) is a diversified supplier to the casino gaming industry worldwide, specializing in the development of innovative products with recurring revenue potential. The company develops, manufactures and markets an expanding array of slot games, table games and advanced player tracking and accounting systems for slot machines and table games. The company is also a leader in exciting visual displays and progressive jackpot technology for casinos worldwide. There is a Mikohn product in virtually every casino in the world. For further information, visit the company's Web site: http://www.mikohn.com MIRANT CORP: MAGI Committee Asks Court to Set-Up Screening Wall --------------------------------------------------------------- The Official Committee of Unsecured Creditors of Mirant Americas Generation, LLC asks the Court to: (i) approve certain information blocking procedures; (ii) permit the MAGI Committee members' trading of the Debtors' securities, trading bank debt purchase or sale of trade debt; and (iii) approve issuance of analyst report upon establishment of a screening wall effective July 25, 2003. Some MAGI Committee members are engaged in the trading of Securities or Bank Debt for others or for their own accounts as a regular part of their business. Some MAGI Committee members also issue Analyst Reports. These Securities Trading MAGI Committee Members owe fiduciary duties to the estate creditors. However, Deborah D. Williamson, Esq., at Cadwalader, Wickersham & Taft, in New York, points out, the Securities Trading Committee Members also have fiduciary duties to maximize returns to their clients through trading securities. Thus, if a Securities Trading Committee Member is barred from trading the Debtors' Securities, trading Bank Debt or purchasing or selling trade debt during the pendency of these Chapter 11 cases because of its duties to other creditors, it may risk the loss of a beneficial investment opportunity for itself or its clients. Moreover, Ms. Williamson says, these Securities Trading Committee Members may breach their fiduciary duty to their clients. Alternatively, if a Securities Trading Committee Member resigns from the Committee, its interest may be compromised by virtue of taking a less active role in the reorganization process. "Securities Trading Committee Members should not be forced to choose between these roles," Ms. Williamson asserts. Accordingly, the MAGI Committee proposes that any Committee member that wishes to trade in the Debtors' Securities, trade in the Bank Debt, purchase or sell trade debt or issue Analyst Reports will file with the Bankruptcy Court a Screening Wall Declaration by each individual performing Committee-related activities in these Chapter 11 cases. The Declaration will state that the individual will comply with the terms and procedures consistent with the Declaration. Ms. Williamson explains that the term "Screening Wall" refers to a procedure established by an institution to isolate its trading and analyst activities from its activities as a member of an official committee of unsecured creditors in a Chapter 11 case. A Screening Wall includes, among other things, features as the employment of different personnel to perform certain functions, physical separation of the office and file space, procedures for locking committee-related files, among other things. These procedures prevent the Securities Trading Committee Member's trading personnel from use or misuse of non-public information obtained by the Securities Trading Committee Member's personnel engaged in Committee-related activities and also precludes Committee Personnel from receiving inappropriate information regarding that Securities Trading Committee Member's trading in Securities or Bank Debt in advance of those trades and information to be included in analyst reports. Ms. Williamson notes that bankruptcy courts generally allows the establishment of a Screening Wall without the creditors violating their fiduciary duties as committee members, so long as it acts in accordance with certain information blocking procedures the Court approved. Mirant Creditors' Committee Joins In The Official Committee of Unsecured Creditors of Mirant Corporation joins in the MAGI Committee's request to establish a Screening Wall in its entirety. Accordingly, the Mirant Committee asks the Court to direct that the relief to be granted to the MAGI Committee will also apply to the Mirant Committee members. (Mirant Bankruptcy News, Issue No. 6; Bankruptcy Creditors' Service, Inc., 609/392-0900) MOODY'S CORP: Will Present at ThinkEquity Conference on Tuesday --------------------------------------------------------------- John Rutherfurd, Jr., President and CEO of Moody's Corporation (NYSE: MCO), will speak at ThinkEquity Partners' Growth Conference on Tuesday, September 16, 2003 in San Francisco. Mr. Rutherfurd's presentation will begin at approximately 2:30 PM Pacific Time and will be webcast live. The webcast can be accessed at Moody's Shareholder Relations Web site at http://ir.moodys.com Moody's Corporation (NYSE: MCO), whose March 31, 2003 balance sheet shows a total shareholders' equity deficit of $327 million, is the parent company of Moody's Investors Service, a leading provider of credit ratings, research and analysis covering debt instruments and securities in the global capital markets, and Moody's KMV, a leading provider of market-based quantitative services for banks and investors in credit- sensitive assets serving the world's largest financial institutions. The corporation, which employs approximately 2,100 employees in 18 countries, had reported revenue of $1.0 billion in 2002. Further information is available at http://www.moodys.com MWAM CBO: Fitch Cuts Class C-1, C-2 Notes & Preferred to BB-/B- --------------------------------------------------------------- Fitch Ratings affirms one tranche and downgrades four tranches of MWAM CBO, series 2001-1 Ltd. The following tranches have been downgraded and removed from Rating Watch Negative: -- Class B notes to 'A-' from 'AA'; -- Class C-1 notes to 'BB-' from 'BBB'; -- Class C-2 notes to 'BB-' from 'BBB'; -- Preference shares to 'B-' from 'BB-'. Fitch affirms the following class and removes it from Rating Watch Negative: -- Class A notes 'AAA'. MWAM CBO Series 2001-1 Ltd. is a collateralized debt obligation managed by Metropolitan West Asset Management, LLC. The CDO was established in January 2001 to issue $250.5 million in debt and equity securities. Payments are made semi-annually in January and July, and the reinvestment period ends in January 2004. According to the July 2003 trustee report, the transaction is failing its Fitch weighted-average rating factor test, with an actual WARF of 22 compared to a WARF trigger of 17.0. The non-investment grade bucket is 25.5%, compared to the 10% limitation. In addition to the $9.85 million of defaulted collateral, the portfolio contains a number of securities whereby default is probable. In particular, the portfolio contains exposure to a number of distressed assets, including aircraft leasing securitizations (5.26%), a CDO (0.25%) that has been written-down, and a GreenTree manufactured housing limited guarantee bond (1.54%). The notes were placed on Rating Watch Negative on April 25, 2003. The rating actions are based on the deterioration of the credit fundamentals of the portfolio to the point where the risk may no longer be consistent with the current ratings. In addition, the current interest rate environment has placed increased pressure on excess spread. Given the current low interest rate environment, the terms of the interest rate swap, which were negotiated at closing, have created a cash drain on the transaction. To counteract this, MetWest has utilized a strategy that includes purchasing short duration U.S. agency mortgage derivatives, such as inverse floaters and two-tiered index bonds. These bonds currently represent 16.21% of the portfolio. The inclusion of these 'AAA' bonds has the effect of improving the WARF and increasing the weighted average spread. The ratings reflect the effect of the interest rate swap, inverse floaters and TTIBs on cash flows in various interest rate scenarios. Fitch will continue to monitor the performance of the CDO over time. Fitch will focus on the credit quality of the portfolio and in particular, the concentration of assets in the non-investment grade category. Future downward migration in the credit quality of the pool may warrant further review of the transaction ratings. NATIONAL STEEL: Asks Court to Clear ICWU Memorandum of Agreement ---------------------------------------------------------------- International Chemical Workers Union Counsel, together with other labor organizations, represents 80% of the National Steel Debtors' workforce. Prior to the Petition Date, this workforce was comprised of 8,000 employees. The Debtors and ICWU have maintained a collective bargaining relationship for decades and have been parties to numerous collective bargaining agreements, including various benefit programs. ICWU has asserted that under the Collective Bargaining Agreements, the Debtors could have a significant pension plan, legacy and other post-employment benefits obligations for their current employees and retirees in millions of dollars. In addition, the ICWU has asserted claims against the Debtors based on amounts owed to ICWU-represented retirees. In connection with negotiations regarding the sale of their assets to U.S. Steel, the Debtors sought assurance from the labor unions that if a new collective bargaining agreement with the buyer were accomplished, they would agree to a consensual termination of the existing Collective Bargaining Agreements. Under the Collective Bargaining Agreements, despite entry into a new agreement with U.S. Steel, the ICWU continued to have significant administrative and prepetition claims against the Debtors' estates. The Debtors desire to minimize and settle these claims on consensual terms if possible. To resolve all remaining issues with the ICWU, the Debtors entered into negotiations regarding the terms of the consensual termination of the Collective Bargaining Agreements. Accordingly, the Debtors sought and obtained the Court's approval of the ICWU Memorandum of Agreement. Critically, under the MOA, the ICWU will waive certain administrative claims against the Debtors. A summary of the salient terms and conditions of the MOA provides: (1) termination of all Collective Bargaining Agreements, any obligations of the Debtors related to them, and a mutual release of claims; (2) transition to U.S. Steel of certain benefits and benefit programs, like workers' compensation and conversion privileges for life insurance, and the parties' cooperation in this process, including with respect to the transfer of 401(k) plan assets and a pro-rata share of the VEBA -- National Voluntary Employee Beneficiary Association; (3) treatment of Claims incurred by employees or their eligible dependents before the closing date of the sale to U.S. Steel for medical, vision or dental services, sickness and accident benefits and life insurance; (4) payment of health and life insurance benefits for retirees through August 31, 2003 at a cost to be paid for by the VEBA up to a maximum of $400,000 with the Debtors being responsible for the cost in excess of $400,000; (5) COBRA continuation rights with premium costs covered by retirees and former employees for the period from September 1, 2003 to December 31, 2003 with the VEBA covering costs in excess of premiums up to $120,000 in aggregate for retirees; (6) retention by the ICWU of a $65,000,000 general unsecured claim relating to other Post-Employment Benefit liabilities against the Debtors; and (7) payment of certain actual costs and expenses incurred by the ICWU during the cases amounting to $55,000. With the MOA, the Debtors are able to resolve all outstanding issues with ICWU. Providing for the consensual termination of the Collective Bargaining Agreements and resolution of issues with respect to outstanding retiree benefits, the MOA avoids the uncertainty and costs of associated with litigation pursuant to Sections 1113 and 1114 of the Bankruptcy Code. The Debtors believe that it is appropriate for the estates to reimburse certain fees and expenses of the ICWU's professionals. The Debtors determined that a new collective bargaining agreement for their employees was a critical aspect of their restructuring efforts. Due to the size, nature, and complexity of their business, the Debtors note that this was a difficult project requiring substantial efforts from ICWU and their professionals. (National Steel Bankruptcy News, Issue No. 35; Bankruptcy Creditors' Service, Inc., 609/392-0900) NRG ENERGY: Seeks Open-Ended Lease Decision Period Extension ------------------------------------------------------------ Kelly K. Frazier, Esq., at Kirkland & Ellis, in New York, reports that the NRG Energy Debtors remain party to a single unexpired non-residential real property lease. The Lease was entered into between the Debtors and the International Land Centre Limited Partnership on May 2, 2000. The Lease pertains to the Debtors' corporate headquarters facility located in Minneapolis, Minnesota. Pursuant to Section 365(d)(4) of the Bankruptcy Code, the Debtors ask the Court to extend its lease decision period through and including the confirmation of the Plan. According to Ms. Frazier, the requested extension will give the Debtors sufficient opportunity to complete its discussions with International Land and to make an informed business decision regarding whether to assume or reject the Lease. Because the Debtors are, and will remain, current on its obligations under the Lease pending the rejection or assumption, the requested extension will not prejudice International Land. In addition, Ms. Frazier emphasizes, International Land does not object to the requested extension. In the event of any postpetition payment default by the Debtors, International Land may ask the Court to fix an earlier date by which the Debtors must assume or reject the Lease in accordance with Section 365(d)(4). (NRG Energy Bankruptcy News, Issue No. 9; Bankruptcy Creditors' Service, Inc., 609/392-0900) NUCENTRIX BROADBAND: Case Summary & Largest Unsecured Creditors --------------------------------------------------------------- Lead Debtor: Nucentrix Broadband Networks, Inc. 4120 International Parkway Suite 2000 Carrollton, Texas 75007 Tel: 972-423-9494 aka Heartland Wireless Communications, Inc. Bankruptcy Case No.: 03-39123 Debtor affiliates filing separate chapter 11 petitions: Entity Case No. ------ -------- Heartland Cable Television, Inc. 03-39124 Nucentrix Internet Services, Inc. 03-39125 Nucentrix Spectrum Resources, Inc. 03-39126 Arbuckle Cablevision, Inc. 03-39130 Cablemaxx, Inc. 03-39135 Cablemaxx (Texas), Inc. 03-39138 Central Oklahoma Wireless Cable, Inc. 03-39139 Country Wireless, Inc. 03-39140 Eastern Oklahoma Wireless Cable, Inc. 03-39141 Great Plains Wireless, Inc. 03-39142 Heartland Wireless-Des Moines, L.C., Inc. 03-39143 Heartland Wireless Illinois Properties, Inc. 03-39144 Heartland Wireless Texas Properties, Inc. 03-39145 Northern Oklahoma Wireless Cable, Inc. 03-39146 Rural Wireless South, Inc. 03-39147 Southwest Wireless Cable, Inc. 03-39148 Supreme Cable Metroplex, Inc. 03-39149 Wireless Leasing, Inc. 03-39150 Type of Business: The Debtors provide broadband wireless Internet and multichannel video services using up to 200 MHz of radio spectrum at 2.1 GHz and 2.5 GHz, commonly referred to as Multichannel Multipoint Distribution Service (MMDS) and Instructional Television Fixed Service (ITFS). Chapter 11 Petition Date: September 5, 2003 Court: Northern District of Texas (Dallas) Judge: Harlin DeWayne Hale Debtors' Counsel: John E. Mitchell, Esq. Josiah M. Daniel, III, Esq. Todd C. Crosby, Esq. 3700 Trammell Crow Center Vinson and Elkins, LLP 2001 Ross Ave. No. 3700 Dallas, TX 75201 Tel: 214-220-7700 Total Assets: $69,452,000 (as of March 31, 2003) Total Debts: $31,676,000 (as of March 31, 2003) Debtors' 20 Largest Unsecured Creditors: Entity Nature Of Claim Claim Amount ------ --------------- ------------ Waterford HP, Ltd. Breach of Office Lease $461,938 1826 A. Kramer Lane Austin, TX 78758 Attn: K. Mark Vincent Vial Hamilton Koch & Knox, LLP 1717 Main St, Suite 4400 Dallas, TX 75201 Tel: (214) 712-4400 Fax: (214) 712-4402 Home Box Office/ Trade Debt $313,212 Time Warner 1100 Avenue of the Americas New York, NY 10036-6737 John Haggerty HBO Tel: (212) 512-1000 Fax: (212) 512-7522 O'Melveny & Myers LLP Legal Fees $278,131 1650 Tyson Blvd., Suite 250 McLean, VA 22102 Dominick DeChiara (212) 408-2400 Fax: (212) 408-2420 Portal Software, Inc. Breach of Contract $248,625 TIBCO Software, Inc. Breach of Contract $225,000 Gelber Organization Contract Dispute $188,000 MCI Worldcom Trade Debt $173,780 ESPN, Inc. Trade Debt $125,741 World Satellite Network, Trade Debt $66,827 Inc. MTV Networks Trade Debt $66,028 ABC Cable Networks Group Trade Debt $60,599 USA Networks Trade Debt $28,273 Showtime Networks, Inc. Trade Debt $27,162 Perfect 10 Satellite Trade Debt $18,432 Distrib. MBD Limited Partnership Office Lease $16,223 DSI Systems, Inc. Trade Debt $14,302 Westar Property Management Office Lease $13,000 TXU Energy Trade Debt $9,412 Pioneer Telephone Trade Debt $9,000 Cooperative Southpark Investors LP Office Lease $8,839 Group 1 Software Trade Debt $6,928 Hutton Communications, Trade Debt $6,497 Inc. Discovery Communications Trade Debt $5,374 Malek, Inc. Trade Debt $5,066 Davis Brothers Real Estate Office Lease $5,020 Frost Bank Plaza Trade Debt $5,005 Cecil R. Cox Office Lease $4,600 City of Austin Trade Debt $4,464 OG&E Trade Debt $3,633 DST Output Trade Debt $3,364 OREGON STEEL MILLS: S&P Assigns B Corporate Credit Rating --------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B' corporate credit rating to Portland, Oregon-based Oregon Steel Mills Inc. The outlook is negative. In addition, Standard & Poor's assigned its 'B' rating to the company's $305 million first mortgage notes due 2009 and its 'B+' bank loan rating to its $65 million senior secured credit facility expiring June 30, 2005. The facility is rated one notch above the corporate credit rating reflecting the very strong likelihood of full recovery of principal under a default or bankruptcy scenario. The company has about $305 million in total debt. Standard & Poor's withdrew its ratings on Oregon Steel in August 2003 at the company's request. "The ratings assigned today are one notch below the previous ratings, reflecting difficult industry conditions, weak operating results, and declining liquidity," said Standard & Poor's credit analyst Paul Vastola. Standard & Poor's said that its ratings reflect Oregon Steel's declining liquidity, high input costs, aggressive capital structure and volatile operating performance resulting from exposure to cyclical industries, particularly the oil and gas transmission pipeline business, as well as extremely difficult overall industry conditions. ORGANOGENESIS: Emerges from Chapter 11 Bankruptcy Proceedings ------------------------------------------------------------- Organogenesis Inc., completes its court-approved reorganization plan, allowing the company to emerge from Chapter 11 protection and continue manufacturing and supplying Apligraf, its bilayered skin substitute approved to heal venous leg ulcers and diabetic foot ulcers. Consistent with the terms of the plan, all outstanding common stock, preferred stock and other equity interests in the company have been cancelled and new shares of the reorganized common stock have been issued. A new board of directors has also been appointed. "Organogenesis has emerged from its restructuring as a leaner and financially stronger company," said Alan Ades, Chairman and Chief Executive Officer. "We were able to complete this restructuring due to the cooperation and participation of our employees, outgoing board members, new investors and stakeholders who supported our efforts to reposition the company to compete more effectively. Apligraf is a vital product so we are gratified that we can continue to provide it to patients who urgently need it." The emergence from bankruptcy is good news for doctors and patients who have relied on Apligraf as an effective wound healing therapy for the treatment of diabetic foot ulcers and venous leg ulcers. "The continued availability of Apligraf is exciting news for patients with chronic wounds and for practitioners who treat these wounds. Many patients have benefited greatly from its use," said Dr. John Giurini, Chief of Podiatry and Co-director of the Joslin- Beth Israel Foot Center. "Apligraf is significantly effective in treating chronic, non-healing wounds in diabetic patients and it is encouraging to know there will be no supply interruption." Organogenesis has used its time under Chapter 11 protection to restructure its business. Under the supervision of the court, the company discharged all pre-petition claims, reduced costs and renegotiated its relationship with Novartis Pharma AG, the former distributor of Apligraf. As a result, Organogenesis now holds an exclusive license to use the Apligraf trademark and has the exclusive right to market and distribute Apligraf. Organogenesis Inc., was the first company to develop and gain FDA approval for a mass-produced product containing living human cells. Apligraf, the Company's principal product, a living, bi- layered skin substitute, has received FDA approval for the treatment of diabetic foot ulcers and venous leg ulcers. PETCO ANIMAL: Opens Newly Relocated Germantown, Tennessee Store --------------------------------------------------------------- PETCO Animal Supplies, Inc. announces the grand opening of the newly relocated Germantown, TN, store, located at 7680 Poplar Avenue, Friday, September 12 through Sunday, September 14. This new store, at just under 12,000 square feet, will be almost twice the size of the 6,529 square foot store it will replace. The new location will not only be larger, but will also feature the company's "Millennium Design" store format, which includes a brighter and more open shopping experience. The design allows customers to be greeted by the animals, and features such popular items as the pet bar. This store format was based largely on customer input. "People in our community are really excited about this new store," PETCO General Manager Marti Sotak said. "We have really loyal customers here, and we know we are going to be able to take even better care of them and their pets in this new PETCO." The three-day celebration will include a Best Pet Trick and Pet/Owner Look-A-Like Contest, as well as opportunities to learn about PETCO services such as obedience training, pet photography and low cost vaccinations. And the kids won't be left out of this celebration of pets and their people, as a clown will be present to provide entertainment. In addition, to demonstrate PETCO's commitment to adoptions, Fayette County Animal Rescue will be on hand all three days to help find loving homes for orphaned companion animals. As part of the effort to encourage adoptions, PETCO stores offer Adoption Gift Booklets with savings of up to $180 on store products and services to help people welcome their new family member home. The store features a small animal and reptile area, fresh and saltwater fish aquariums, a bird area and a grooming salon. To find this Germantown store, or for a complete list of Grand Opening events, visit PETCO's Web site at http://www.petco.com PETCO (Nasdaq: PETC) is a leading specialty retailer of premium pet food, supplies and services with a commitment to quality animal care and education. PETCO's strategy is to offer its customers a complete assortment of pet-related products and services at competitive prices, with superior levels of customer service at convenient locations, by hiring pet lovers and training them to become counselors to our pet-loving customers. PETCO operates more than 640 neighborhood stores in 43 states and the District of Columbia, as well as a leading destination for on-line pet food and supplies at http://www.petco.com The PETCO Foundation, PETCO's non-profit organization, has raised more than $13 million since inception in 1999 and helped more than 1,600 non-profit grassroots animal welfare organizations from around the nation. PETCO Animal Supplies' May 3, 2003 balance sheet shows a total shareholders' equity of about $63,000 up from a deficit of about $11 million recorded at February 1, 2003. PG&E: USGen Wants Open-Ended Lease Decision Period Extension ------------------------------------------------------------ USGen New England, Inc., asks the Court for more time to assume or reject unexpired nonresidential real property leases, through the effective date of a reorganization plan. Pursuant to Section 365(d)(4) of the Bankruptcy Code, if the debtor does not assume an unexpired lease of nonresidential real property "within 60 days after the date of the order for relief, or within such additional time as the court, for cause, within such 60-day period, fixes, then such lease is deemed rejected." Due to the complex nature of USGen's business, an extension is needed to ensure that USGen will have adequate time to ascertain and evaluate its leases to determine which, if any, are beneficial to the business operations and necessary to an effective reorganization. (PG&E National Bankruptcy News, Issue No. 5; Bankruptcy Creditors' Service, Inc., 609/392-0900) PHILIP MORRIS: Says Engle Plaintiffs' Appeals Should be Nixed ------------------------------------------------------------- The Engle plaintiffs have offered no valid legal reasons why Florida's Third District Court of Appeal should reconsider its decision earlier this year to overturn the $145 billion judgment in the case and have the class decertified, according to a legal brief filed Wednesday by Philip Morris USA and other tobacco companies. "The Engle class is trying to achieve by rhetoric what it cannot accomplish by law," said William S. Ohlemeyer, Philip Morris USA vice president and associate general counsel. "In seeking reconsideration, the Engle plaintiffs have offered no valid legal reasons why the Court should grant them a rehearing or any reconsideration of its decision to overturn the judgment and order the trial court in Miami to decertify the class. "Florida's Third District Court of Appeal made it abundantly clear in its ruling why the Engle judgment violated basic principles of due process and fairness, in addition to the Florida law that should have governed the class action case," he added. In its 68-page opinion issued on May 21, the Court set forth in considerable detail why the Engle case failed to meet virtually every legal requirement for class certification; it also reversed the $145 billion punitive-damages award in favor of the now- decertified class and the compensatory-damage awards totaling $12.7 million in favor of three individual plaintiffs whose claims were tried in the second phase of the trial. In responding to the Engle plaintiffs' request for a rehearing, Philip Morris USA and other tobacco companies told the appellate court that, "by making scattershot assertions that everything in the Court's opinion is erroneous, plaintiffs confirm their inability to establish that anything in the opinion requires further review." The Engle plaintiffs, through lawyers Stanley and Susan Rosenblatt, were highly critical of the appellate court's ruling, accusing the judges of racial bias regarding the Engle jury and alleging that they had engaged in "judicial plagiarism" by accepting verbatim many of the arguments of the tobacco companies in their appeals filings. "Plaintiffs have engaged in professional misconduct by assailing the Court itself. Throughout their submission, plaintiffs accuse the Court of 'plagiarism' and judicial 'dishonesty'. Their accusations are spurious and offensive. "The opinion on its face shows that the Court exercised independent judgment, supporting its conclusions with detailed case citations, case quotations and lengthy excerpts from the trial record," the companies said in their submission, adding "a motion for rehearing that insults the Court is not only improper but sanctionable." Ohlemeyer said it is clear that "the Court's decision reversing the Engle judgment was in line with the country's legal mainstream, which does not allow class actions in smoking and health cases. "The appellate court agreed with over 40 decisions by state and federal courts across the country that have concluded the law doesn't allow claims of smokers to be tried as class actions because each claim must consider the circumstances unique to each individual." In its May 21 opinion, the Court criticized the plaintiffs' lawyer for his conduct throughout the trial, stating: "It is obvious that the 'runaway' jury award was largely the result of numerous improper comments by plaintiffs' counsel directing the jury to disregard limitations on punitive damages. The trial was book- ended with prejudicial misconduct which incited the jury to disregard the law because the defendants are tobacco companies." In a summary of its decision, the Court stated "the fate of an entire industry and of close to a million Florida residents cannot rest upon such a fundamentally unfair proceeding." The Engle case was filed in 1994 as a nationwide class action consisting of smokers who had contracted diseases associated with smoking. In 1996, Florida's Third District Court of Appeal allowed the case to proceed as a statewide class action. However, the Court reversed the verdicts and ordered the class decertified after reviewing the results of the trial and other developments since its 1996 decision. The Engle case was conducted in two phases, with a third phase envisioned by Miami Circuit Court Judge Robert P. Kaye if there were plaintiffs' verdicts in the earlier phases. Phase One began on Oct. 19, 1998, and ended on July 7, 1999, when a six-person jury found that smoking could cause more than 20 diseases or medical conditions; that cigarettes are addictive or dependence producing; and that tobacco companies could be assessed punitive damages. Phase Two began on Nov. 1, 1999, and focused on whether the tobacco companies were liable to three individual smokers who had cancer. On April 7, 2000, the six-person jury found in favor of plaintiffs Mary Farnan, Frank Amodeo and the estate of Angie Della Vecchia and awarded a total of $12.7 million in compensatory damages, setting the stage for the punitive damages phase. Plaintiff Frank Amodeo was also found by the jury to have sued too late. The same six-person jury on July 14, 2000, returned a plaintiffs' verdict assessing punitive damages of nearly $145 billion against the cigarette makers. Judge Kaye subsequently entered an order of final judgment against the companies despite his own ruling that each of the estimated 700,000 class members would require individual trials, setting the stage for the appeal to Florida's Third District Court of Appeal. PHOENIX GROUP: Texas Court Confirms Plan of Reorganization ---------------------------------------------------------- The Phoenix Group Corporation (OTC Pink Sheets: PXGP - News) announced that 100% of creditors submitting allowed claims have accepted Phoenix's plan of debt conversion and that the United States Bankruptcy Court for the Northern District of Texas, Fort Worth Division, has confirmed the company's plan of reorganization. In addition, Phoenix is pleased to announce that as of the Shareholder meeting in September, 2003, the newest additions to their board of directors will be Robert E. Bachman, Daryl N. Snadon, Frank L. "Duke" Yetter, Don Harkleroad, and J. Michael Poss, who is also president of Phoenix. Ronald E. Lusk and Robert L. Woodson, III will retain their existing board seats. Commenting on these additions to the board of directors, Ron Lusk, chairman of The Phoenix Group Corporation said, "We are extremely excited that we are able to add these gentlemen to our board of directors. Now that the reorganization plan can be effected, their business experience will be quite valuable to us as we emerge as a new company. The last year has been an uphill struggle for Phoenix, but with our plan of reorganization being accepted by the creditors and the court, as well as expanding our board with experienced, successful business people, we are now poised for growth. We will now go back to our original business plan, which called for growth via acquisitions in the home healthcare and related businesses. As we previously announced, we will apply fresh start accounting principles to become current with our SEC filings, allowing us to once again become a fully reporting company. Once we become fully reporting, we firmly believe that we will be able to attain a NASDAQ OTC listing. Our shareholders and creditors have been very patient and supportive of our efforts on their behalf, and we look forward to rewarding their support by executing our business plan." The Phoenix Group Corporation is a Delaware Corporation organized in June 1988. Phoenix has predominately been engaged in providing healthcare management and ancillary services to the long-term care industry. Management of the Company has undertaken to implement a strategic business plan to reposition Phoenix through new growth initiatives involving targeted business acquisitions in the home health care industry. PILLOWTEX CORP: Asks Court to Approve $1.7MM GGST Break-Up Fee -------------------------------------------------------------- In connection with the GGST Sale and the bidding procedures, the Pillowtex Debtors ask the Court to approve a $1,700,000 Break-Up Fee to be given to GGST, LLC and an expense reimbursement aggregating to $500,000. But in its Order, the Court modifies the bidding protections, as: (1) a $1,540,000 Break-up fee; and (2) an expense reimbursement in an aggregate amount not to exceed $500,000. William H. Sudell, Jr., Esq., at Morris, Nichols, Arsht & Tunnel, in Wilmington, Delaware, relates that the Expense Reimbursement and the Break-Up Fee were and are material inducements for, and conditions of, GGST's entry into the Purchase Agreement. Assurance to GGST of payment of the Expense Reimbursement and the Break-Up Fee will promote more competitive bidding. Furthermore, the Court orders that the Debtors' obligation to pay the Expense Reimbursement and Break-Up Fee: (1) will constitute a super-priority administrative expense claim in the cases under Section 364(c)(1) of the Bankruptcy Code, secured by a first priority lien against any Good Faith Deposit retained by the Debtors, and (2) will be further payable out of the proceeds to the Debtors from any Sale Transaction. (Pillowtex Bankruptcy News, Issue No. 50; Bankruptcy Creditors' Service, Inc., 609/392- 0900) PRIMEDEX HEALTH: Seeks Consent to Extend Defaulted Debentures ------------------------------------------------------------- In connection with Primedex Health Systems Inc.'s default in its obligation to redeem the $16.3 million in its outstanding 10% convertible subordinated debentures due June 30, 2003, the Company requested debenture holders to consent to the extension of the debenture for an additional five years through June 30, 2008, in return for which the Company agreed to (i) increase the annual interest rate to 11.5%; (ii) reduce the conversion rate to $2.50; and (iii) agree not to redeem the debentures prior to July 1, 2005. Primedex received from the solicitation the approval of 94% of the debenture holders responding and 96% in amount of those responding. Inasmuch as the approval received far exceeded the required majority of the debenture holders in number and two thirds in amount of those responding, the Company has filed a prepackaged Chapter 11 Plan of Reorganization with the Bankruptcy Court in Los Angeles, California to confirm the Plan and to approve the change which will then bind all debenture holders. According to Primedes, the Bankruptcy proceeding should have no other impact on the Company. Primedex Health Systems, Inc., Los Angeles, California (OTCBB:PMDX), owner and operator of 57 California medical diagnostic imaging facilities. The Company filed for Chapter 11 protection on September 4, 2003 in the U.S. Bankruptcy Court for the Central District of California, Los Angeles (Bankr. Case No. 03-33211) PRIMUS TELECOMMS: Prices $110 Million Convertible Senior Notes -------------------------------------------------------------- PRIMUS Telecommunications Group, Incorporated (Nasdaq:PRTL), a global telecommunications services provider offering an integrated portfolio of voice, Internet, data and hosting services, announced the pricing of its offering of $110 million of convertible senior notes, due September 2010, to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended. The sale of the Notes is expected to close on September 15, 2003 and is subject to customary closing conditions. The Notes will bear interest at the rate of 3.75% per year and will be payable in cash semi-annually in arrears on March 15 and September 15 of each year, with the first interest payment due on March 15, 2004. Holders of outstanding Notes may convert their Notes into PRIMUS's common stock at any time prior to maturity at an initial conversion price of $9.3234 per share, which is equivalent to an initial conversion rate of 107.257 shares per $1,000 principal amount of Notes, subject to adjustment in certain circumstances. The initial conversion price represents a 23% premium to the last reported price for PRIMUS common stock on the Nasdaq National Market on September 9, 2003. PRIMUS has also granted the initial purchasers of this offering a 30-day option to purchase up to an additional $22 million of the Notes. The Company intends to use the net proceeds from this offering to repay fully its existing 11-3/4% senior notes due August 2004 in the principal amount of $43.6 million, to repay or repurchase other long-term obligations, and for working capital and general corporate purposes. The securities offered have not been registered under the Securities Act, or any state securities laws, and are only being offered to qualified institutional buyers in reliance on the exemption from registration provided by Rule 144A. Unless so registered, the Notes and any common stock issued upon conversion of the Notes may not be offered or sold in the United States except pursuant to an exemption from the registration requirements of the Securities Act and applicable state securities laws. PRIMUS Telecommunications Group, Incorporated (NASDAQ:PRTL) -- whose June 30, 2003 balance sheet shows a total shareholders' equity deficit of about $127 million -- is a global facilities- based telecommunications services provider offering international and domestic voice, Internet, data and hosting services to business and residential retail customers and other carriers located primarily in the United States, Canada, Australia, the United Kingdom and western Europe. PRIMUS provides services over its global network of owned and leased transmission facilities, including approximately 250 points-of-presence throughout the world, ownership interests in over 23 undersea fiber optic cable systems, 19 carrier-grade international gateway and domestic switches, and a variety of operating relationships that allow it to deliver traffic worldwide. PRIMUS also has deployed a global state-of-the-art broadband fiber optic ATM+IP network and data centers to offer customers Internet, data, hosting and e-commerce services. Founded in 1994, Primus is based in McLean, VA. ROWE INT'L: Wants Court Nod to Hire Miller Johnson as Counsel ------------------------------------------------------------- Rowe International, Inc., seeks permission from the U.S. Bankruptcy Court for the Western District of Michigan to employ Miller, Johnson, Snell & Cummiskey, PLC as general bankruptcy counsel. The Debtor assure the Court that Miller Johnson has the necessary background to deal effectively with many of the potential legal issues and problems that may arise in the context of this chapter 11 case. The Debtor believes that Miller Johnson is both well qualified and able to represent it in this chapter 11 case in an efficient manner. In this retention, Miller Johnson is expected to: a. advise Debtor of its rights, powers, and duties as debtor and debtor-in-possession; b. take all necessary action to protect and preserve the Debtor's estate, including prosecution of actions of Debtor's behalf, the defense of actions commenced against the Debtor, the negotiation of disputes in which Debtor is involved, and the preparation of objections to claims filed against the estate; c. assist in preparing on behalf of Debtor all necessary motions, allocations, answers, orders, reports, and papers in connection with the administration of Debtor's estate; d. assist in presenting on behalf of Debtor the proposes plan of reorganization and all related transactions and any related revisions, amendments, etc.; and e. performing such other legal services in connection with this chapter 11 case as may be requested by Debtor from time to time. Thomas P. Sarb, Esq., assures the Court that the members and associates of Miller Johnson do not have any connection with or any interest adverse to Debtor, its creditors, or any other party in interest, and are "disinterested persons" as that term is defined in the Bankruptcy Code. The Debtor reports that it paid Miller Johnson a $75,000 retainer for professional services to be rendered and expenses to be charged by Miller Johnson in connection with its representation of Debtor. Miller Johnson will apply the Retainer to pay any fees, charges and disbursements in connection to this engagement. Mr. Sarb does not disclose the current hourly rates that his firm will charge the Debtor but reports that during the three-month period prior to the Petition Date, the Debtor paid the firm $230,000 for fees and expenses incurred prior to the Petition Date. This amount already includes the $75,000 retainer. Headquartered in Grand Rapids, Michigan, Rowe International, Inc., manufactures commercial and home CD jukeboxes. The Company filed for chapter 11 protection on August 29, 2003 (Bankr. W.D. Mich. Case No. 03-10537). The Debtor listed estimated assets of more than $10 million and estimated debts of more than $100 million in its petition. ROYAL & SUNALLIANCE: S&P Knocks BB+ Ratings Off CreditWatch ----------------------------------------------------------- Standard & Poor's Ratings Services lowered its counterparty credit and financial strength ratings on Royal & Sun Alliance Insurance PLC's (R&SAIP;A-/Negative/A-2) U.S. insurance operations to 'BB+' from 'BBB-' and removed them from CreditWatch. Standard & Poor's also said that the outlook on RSA USA is negative. "The ratings were lowered to reflect Standard & Poor's view that RSA USA's ongoing businesses could potentially be sold in the near term," explained Standard & Poor's credit analyst Frederick Loeloff. "In addition, the managed run-off of its discontinued business lines will remain an earnings and liquidity drag for both RSA USA and, indirectly, Royal & Sun Alliance Insurance Group PLC." R&SAIP is the main operating company of R&SA. The ratings had been placed on CreditWatch following R&SA's announcement that it intends to strengthen its U.S. reserve position by at least about $600 million (pretax) in the third quarter of 2003 and that it is actively considering a range of options with respect to its remaining U.S. businesses. The RSA USA units designated as ongoing businesses will function within their normal capacity. However, expectations are that prospective loss-payment frequency/severity on modest premium collections and a declining invested asset base will place both operational and capital-management pressures on RSA USA's operations and remain a primary cause for deteriorating liquidity in the near term. In addition, the prospective marginal support that R&SA has committed to provide RSA USA to maintain risk-based capital requirements in line with statutory requirements (2.0x) will leave the U.S. operations little or no cushion to generate investment earnings to offset potential prospective operational risk or adverse loss development. Standard & Poor's will remain in discussions with RSA USA--along with R&SA management--concerning their plans for RSA USA's ongoing businesses and capital/risk-management strategies needed to support the U.S. operations' ongoing business and related managed run-off. ROYAL IMDEMNITY: S&P Lowers Ratings on Four Related CMBS Deals -------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on four CMBS securities and removed them from CreditWatch with negative implications. The previous CreditWatch placements occurred Sept. 5, 2003, at which time all four transactions were downgraded. The rating outlook for each security is negative. The actions reflect the fact that the ratings on each security are dependent upon the financial strength rating of Royal Indemnity Co., which was lowered today to 'BB+' from 'BBB-' and removed from CreditWatch negative. The outlook on Royal is negative. RATINGS LOWERED; OUTLOOK NEGATIVE Banc of America Large Loan Inc. Commercial mortgage pass-through certs series 2001-WBM Rating Series To From A BB+/Neg BBB-/Watch Neg CVS Credit Lease Pass Through Certificates Rating Class To From A2 BB+/Neg BBB-/Watch Neg Short Term Asset Receivables Trust Net lease pass-through certs series BC 2000A Rating Class To From Certs BB+/Neg BBB-/Watch Neg North First Credit Lease Trust 2001-CTL1 Credit lease-backed pass-through certs Rating Class To From Certs BB+/Neg BBB-/Watch Neg SAFETY-KLEEN: Resolves All Disputes with Zachry International ------------------------------------------------------------- Michael W. Yurkewicz, Esq., at Skadden Arps Slate Meagher & Flom LLP, in Wilmington, Delaware, relates that the Reorganized Safety- Kleen Debtors has resolved its multifarious and multi-forum disputes with H. B. Zachry Company (International), specifically: (1) Zachry's claims against Safety-Kleen Envirosystems Company of Puerto Rico, Inc.; and (2) the outstanding litigation between the parties in Puerto Rico and the United States. The Contract On September 29, 1999, Zachry and SKE signed a contract whereby Zachry agreed to build a dike and related improvements around a plant owned by SKE in Manati, Puerto Rico. The Puerto Rico Facility specializes in recycling of industrial solvents used by businesses in and around Puerto Rico and the Caribbean. After the Petition Date, Zachry suspended its performance under the Zachry contract and refused to complete and deliver to SKE the certified "as built" drawings and construction survey for which SKE had contracted. On October 21, 2000, Zachry filed claim no. 6368 against SKE for $1,829,782.45. The Rejection Motion Following a review of SKC's business relationship with Zachry and the economic impact on SKE's estate in continuing the relationship, the Debtors determined to reject the contract with Zachry. As part of this decision, the Debtors were able to procure the remaining services that Zachry was to provide under the Contract at substantially reduced costs. On November 30, 2001, SKE sought to reject the Zachry contract, to which Zachry objected. Zachry asserted that, if SKE rejected the contract, SKE would not be able to obtain a use permit for the Puerto Rico Facility, and therefore would not be able to operate the Puerto Rico Facility under applicable law. Zachry asked Judge Walsh to compel SKE to assume the contract and pay Zachry the $1.8 million it was owed. The Puerto Rico and U.S. Suits Zachry brought an adversary proceeding in the Bankruptcy Court against SKE, and a civil action against CMA in the United States District Court for the District of Puerto Rico. In these actions, Zachry sought a declaratory judgment with respect to: (a) whether a use permit was required for the dyke at the Puerto Rico Facility; and (b) whether Zachry's certification was required to obtain that permit. Because the Puerto Rico Litigation affected SKE's rights, SKE intervened in the Puerto Rico Litigation. All of this litigation involved common legal issues requiring interpretation of Puerto Rico law and regulations, and their application to the facts. Accordingly, SKE and Zachry agreed to resolve the common issues relating to Puerto Rico law and regulations before the appropriate judicial forum in Puerto Rico before continuing any litigation relating to the Delaware Litigation or the Rejection Motion. Mr. Yurkewicz reminds Judge Walsh that SKE submitted, and Judge Walsh approved, a stipulation and agreed order between SKE and Zachry continuing the Delaware Litigation and the hearing on the Rejection Motion. The Plan Objection and Resolution In April 2003, Zachry objected to the Plan, asserting that the Debtors were seeking to deem the Zachry contract rejected under the Plan, notwithstanding the Contract Rejection Stipulation. Therefore, in July 2003, SKE and Zachry avoided yet another confrontation by agreeing that the Zachry contract would not be deemed rejected by operation of any provision of the Plan or confirmation order, that the Delaware Litigation and the Rejection Motion would continue to be adjourned until the Common Issues were determined by an appropriate forum in Puerto Rico or otherwise consensually resolved, and that after a final judgment was issued resolving the Common Issues, the parties would return to the Bankruptcy Court for a determination of the Rejection Motion and the Delaware Litigation. Upon what was essentially an affirmation of status quo, Zachry withdrew its objection. The Settlement The parties have now reached a global settlement concluding and resolving all of these disputed matters. The significant terms of the settlement are: (1) Delivery of "As Built" Drawings. Zachry will deliver to SKE the contractors' use permit certification and the "as built" drawings as they currently exist for the Puerto Rico Facility, including any reasonably necessary and readily available supporting documentation; (2) Cooperation. Zachry will participate by telephone in necessary meetings and cooperate with SKE and/or CMA to explain and otherwise assist SKE and/or CMA in addressing any issues raised by Zachry's certification drawings; (3) Payment. SKE will pay Zachry $300,000 in full satisfaction of its claims against SKE. Other than the $300,000 payment, Zachry will receive no distribution in the Chapter 11 cases of any of the Debtors; (4) Rejection of Contract. Upon (i) SKE's $300,000 payment to Zachry, and (ii) Zachry's delivery of certain documents to SKE, the Zachry contract will be rejected under Section 365 of the Bankruptcy Code; (5) Mutual Release. Mutual releases will be granted by Zachry and the Debtors relating to or arising out of the Zachry Litigations; (6) Dismissal of Litigation. SKE and Zachry will move to dismiss the Zachry Litigations with prejudice; and (7) Claim Expunged. The Zachry Proof of Claim will be deemed expunged. In the negotiations leading to the settlement, the Debtors evaluated the relative strengths of the parties' legal positions, the likelihood that SKE would need to assume the Zachry contract for its future operations, and the costs and risks of continued litigation of these disputes in multiple forums. As a result, the Debtors concluded that the settlement is beneficial because they can now obtain the use permit at a fraction of the original cost, reject the Zachry contract, and resolve the Zachry Litigation. (Safety-Kleen Bankruptcy News, Issue No. 64; Bankruptcy Creditors' Service, Inc., 609/392-0900) SAMSONITE CORP: Second Quarter Net Loss Slides-Up to $15 Million ---------------------------------------------------------------- Samsonite Corporation (OTC Bulletin Board: SAMC) reported revenues of $192.2 million, operating income of $18.7 million and net loss to common stockholders of $15.2 million for the quarter ended July 31, 2003. These results compare to revenue of $187.1 million, operating income of $20.3 million and net loss to common stockholders of $11.6 million for the second quarter of the prior year. Preferred stock dividends of $12.9 million for the current quarter and $10.5 million for the prior year are reflected in the net loss to common stockholders. Adjusted EBITDA (earnings before interest expense, taxes, depreciation, amortization, and minority interest, adjusted to exclude restructuring provisions and expenses and to include realized hedge gains), a measure of core business cash flow, was $22.5 million for the quarter compared to $24.2 million in the second quarter of the prior year. Revenues for the six months ended July 31, 2003 were $354.1 million compared to revenues of $347.6 million during the same six-month period in the prior year. Operating earnings for the first six months of the year were $29.1 million compared to $22.8 million during the prior year. Operating earnings in the prior year reflect $2.5 million of provisions for restructuring and asset impairment and restructuring related expenses of $3.1 million included in cost of sales and selling, general and administrative expenses. Net loss to common stockholders for the first six months of the year was $30.8 million versus a net loss of $33.9 million during the prior year. Net loss to common stockholders includes charges of $24.5 million in the current year and $20.7 million in the prior year for preferred stock dividends. Adjusted EBITDA for the first six months of the current year was $37.3 million versus $36.5 million for the same period in the prior year. Chief Executive Officer, Luc Van Nevel, stated: "The second quarter continued to be affected by slow economic conditions throughout the world. Europe's sales in local currency were down 6% from the prior year and were adversely affected by recessionary conditions in some of the major European markets; Asian sales were off 23% primarily because of the effects on travel of the SARS outbreak; and sales in the Americas were off 3%. Luggage and travel-related product sales throughout the world were adversely affected in various degrees by the war in Iraq and the SARS outbreak. While reported revenues show an increase from the prior year, this is due to the effect of the strong euro currency compared to the prior year which caused consolidated sales to increase by approximately $16.8 million for the quarter and $31.1 million year-to-date." Chief Financial Officer, Richard Wiley, commented: "Considering economic conditions in major markets, the Company's performance for the quarter met expectations. Travel-related business continued to be negatively impacted by the Middle East situation and the impact on travel of the SARS virus outbreak. "Mitigating the weakness in sales caused by these demand factors, the Company's fixed operating expenses are significantly lower because of our restructuring efforts as are our variable product costs. While not yet reflected in operating results, the completion of the recapitalization effort at quarter-end further lowered fixed costs going forward by reducing debt and retiring the 13-7/8% preferred stock issuance. The recapitalization of the Company significantly strengthens the Company's competitiveness during difficult economic periods." Samsonite (S&P, B Corporate Credit and CCC+ Subordinated Debt Ratings) is one of the world's largest manufacturers and distributors of luggage and markets luggage, casual bags, backpacks, business cases and travel-related products under brands such as SAMSONITE(R), AMERICAN TOURISTER(R), LARK(R), HEDGREN(R) and SAMSONITE(R) black label. SEMINIS INC: Proposed $250M Sr Sec. Credit Gets S&P's BB- Rating ---------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B+' corporate credit rating to Seminis Inc., the parent guarantor of fruit and vegetable seed manufacturer and distributor Seminis Vegetable Seeds Inc. At the same time, Standard & Poor's assigned its 'BB-' rating to Seminis Vegetable Seeds' proposed $250 million senior secured credit facilities and a 'B-' rating to the company's proposed $190 million senior subordinated notes due 2013. The majority of the proceeds will be used to refinance existing senior secured credit facilities and other indebtedness. The senior secured credit facilities comprise a $60 million, five-year revolving credit facility maturing in 2008, which includes a $10 million sublimit for letters of credit, and a $190 million term loan maturing in 2009. These are secured by substantially all of the company's assets, including the valuable vegetable and fruit germplasm bank. Standard & Poor's estimates that the company will have about $434 million of lease-adjusted total debt outstanding at closing, which is expected in late September of 2003. The outlook on Seminis is stable. "The ratings reflect Seminis' high debt leverage, weak credit ratios pro forma for the issue of the credit facilities, and recent financial difficulties caused by excessive inventories," said Standard & Poor's credit analyst Ronald B. Neysmith. "These factors are partially mitigated by Seminis' good market position in the global fruit and vegetable seed industry, strong brand equity, diverse customer base, and high barriers to entry into the industry." Seminis competes within the fragmented $2.3 billion vegetable seed sector, but is the largest player within the industry, with a market share of approximately twice that of the nearest competitor at about 19% worldwide. The company's seeds are marketed under four full-line brands: Seminis, Asgrow, Petoseed, and Royal Sluis as well as five specialty and regional brands. Seminis' brands have had good acceptance globally with the majority of the seed varieties holding either a No. 1 or No. 2 market position. Customer diversity is good with about 16,000 customers in more than 150 countries. Controlling inventory levels will be the firm's greatest operating challenge. Historically, high inventory levels have had the greatest negative impact on operating profitability, as the company has traditionally overproduced seeds ahead of selling season and been forced to write off old inventory. In fiscal 2000, the company implemented an optimization program and as a result has reduced inventory write-offs to about $17 million annually versus a historical level in excess of $50 million annually. On May 30, 2003, Fox Paine & Company and the management of Seminis Vegetable Seeds Inc. signed a definitive agreement to acquire Seminis Inc. in a transaction valued at approximately $688 million. Fox Paine has agreed to invest up to $241.3 million of cash for an ownership interest of 91% of the primary shares before dilution from the exercises of certain options and warrants; management has agreed to roll over their equity interest for the remaining share. SK GLOBAL: Agrees to Remove Bank One Frozen Account to Wachovia --------------------------------------------------------------- Prior to the Petition Date, SK Global America Inc., deposited funds in Account No. 707002380 located at Bank One's Chicago, Illinois branch. On April 7, 2003, Kookmin Bank, New York Branch commenced an action by filing a motion for summary judgment in lieu of complaint against the Debtor and the Debtor's Parent, SK Global Co., Ltd., in the New York State Supreme Court, New York County, seeking money judgment in connection with certain loans made to the Debtor for $20,000,000. Subsequently, Kookmin commenced another action in the Circuit Court for Cook County, Illinois on April 22, 2003, and filed a complaint and a motion seeking an attachment order authorizing the Sheriff of Cook County, Illinois to attach up to $20,000,000 in the Bank One Account to secure payment of a judgment in Kookmin's favor. That same day, the Illinois Court granted the Attachment Motion and issued the Kookmin Attachment Order. Bank One was thereafter served with the Kookmin Attachment Order. The New York State Supreme Court granted the Kookmin Summary Judgment Motion on May 13, 2003, and issued a $20,000,000 money judgment, plus accrued interest, against the Debtor and its parent SK Global Co., in Kookmin's favor. Kookmin and the Debtor then entered into a Terms of Agreement, dated June 24, 2003, and an Agreed Order, dated June 25, 2003, under which Kookmin agreed to forbear from further enforcement of the Judgment. The next day, the Illinois Court executed and entered the Agreed Order, which also incorporated by reference the Terms of Agreement. On April 17, 2003, Korea Exchange Bank, New York Branch commenced an action against the Debtor and SK Global in the New York State Supreme Court seeking to recover a money judgment for certain loans made to the Debtor for $70,000,000. As a result, the New York State Supreme Court directed the Debtor to maintain at least $50,000,000 in the Bank One Account. Pursuant to the State Court Orders -- the KEB Order and the Kookmin Attachment Order -- Bank One placed a freeze on the Bank One Account, prohibiting the Debtor from reducing the funds held to not less than $70,000,000. The funds in the Bank One Frozen Account constitute property of the Debtor's estate pursuant to Section 541(a) of the Bankruptcy Code, and the Debtor desires to use those funds in the ordinary course of its business operations to pay postpetition wages, salaries, insurance premiums and other necessary operating expenses, all of which are necessary to the continued operation of its business. Under the July 25, 2003 Interim Order authorizing the Debtor to continue using its existing cash management system and bank accounts, unless Bank One is approved by the U.S. Trustee for the Southern District of New York as an Authorized Bank Depository for the Southern District of New York, the Debtor must transfer all funds held in its accounts at Bank One, including the Bank One Frozen Account, to an Authorized Bank. However, Bank One notified the Debtor that it would not seek to qualify as an Authorized Bank. In turn, the Debtor advised Bank One that it has established an account at Wachovia Bank, which is an Authorized Bank, and seeks to transfer the Frozen Account funds there. Bank One expressed its approval of the arrangement and informed the Debtor of its willingness to remove the Freeze and transfer the funds in the Bank One Frozen Account to Wachovia Bank under certain terms and conditions. Accordingly, the Debtor and Bank One stipulate and agree that: (a) Bank One will remove the Freeze and wire transfer the funds in all of the Debtor's accounts maintained at Bank One, including the Bank One Frozen Account, to the Debtor's Account No. 2000003536980 at Wachovia Bank. The Debtor will provide Bank One with wire transfer instructions; (b) After the transfer, the Debtor will have use of the funds in the Wachovia Account to pay its necessary operating expenses, subject to: -- the Debtor's rights and responsibilities as a debtor- in-possession; and -- any Court Order; (c) The Debtor will seek approval of these provisions by the Court, on notice to Kookmin, Korea Exchange Bank, the U.S. Trustee, the Debtor's twenty largest unsecured creditors, and any party having filed a notice of appearance in SK Global's case; and (d) Bank One will be released from any liability to the Debtor for implementing the Freeze or for any alleged violation of the Bankruptcy Code for maintaining the Freeze. The Debtor asks Judge Blackshear to approve the Stipulation. (SK Global Bankruptcy News, Issue No. 4; Bankruptcy Creditors' Service, Inc., 609/392-0900) SOLUTIA INC: Ala. District Court Approves Global PCB Settlement --------------------------------------------------------------- Solutia Inc. (NYSE: SOI) (Fitch, B- Senior Secured Bank Facility and CCC Senior Secured Notes Ratings, Negative) announced court approval of final agreements implementing the settlement of the Abernathy and Tolbert PCB cases against the company in Alabama. Preliminary agreement on the resolution of these cases was announced on Aug. 20, 2003. "We are glad to reach the final step in this lengthy process and are appreciative of all the hard work by all parties to reach this day," said John C. Hunter, chairman and chief executive officer. Representatives for all parties worked the past three weeks developing the final documents, which were approved by The Honorable U.W. Clemon, Chief Judge, United States District Court for the Northern District of Alabama yesterday and The Honorable R. Joel Laird, Jr., State Circuit Judge, Calhoun County, Alabama late this afternoon. The cash settlement totals $600 million, with Solutia's $50 million portion to be paid over time commencing in August 2004. Approximately $160 million of the cash settlement will be provided through the settling companies' commercial insurance. The remaining approximately $390 million will be provided by Monsanto. In addition, as part of the settlement, Solutia arranged for a broad array of community health initiatives for low-income residents of Anniston and Calhoun County to be undertaken by Pfizer Corporation. These programs will be of substantial value to the Anniston community. For more information on Solutia's cleanup efforts, or its economic and community activities in Anniston, visit http://www.solutia.com/Anniston Solutia -- http://www.Solutia.com-- uses world-class skills in applied chemistry to create value-added solutions for customers, whose products improve the lives of consumers every day. Solutia is a world leader in performance films for laminated safety glass and after-market applications; process development and scale-up services for pharmaceutical fine chemicals; specialties such as water treatment chemicals, heat transfer fluids and aviation hydraulic fluid and an integrated family of nylon products including high-performance polymers and fibers. TECHNEST HOLDINGS: Liquidity Issues Raise Going Concern Doubt ------------------------------------------------------------- Technest Holdings Inc. has sold off most of its assets to fund its limited operations including payment of professional fees so as to continue to comply with Exchange Act of '34 Reporting Requirements and on going operations. The Company has also written down all investments and is in the process of closing all operations until it finds an operating company to acquire or merge with. It continues to monitor the investments that are in its investment Portfolio. The Company's objective is to maintain good standing while they explore a corporate and entity growth through merger and/or acquisition. Whether the Company is able to sell the remaining assets or not it believes to have exhausted all current sources of capital and also believes that it is highly unlikely that it will be able to secure additional capital that would be required to undertake additional steps to continue operations as heretofore existed. The Company has a working capital deficiency at June 30, 2003 of approximately $227,000 and recorded net losses from operations for the first six months of 2003 of approximately $88,000. This raises substantial doubt about the Company's ability to continue as a going concern. The Company's continued existence is dependent on its ability to obtain additional debt or equity financing and to generate profits from operations. The Company is continuing to pursue additional equity and debt financing. There are no assurances that the Company will receive additional equity and debt financing. TENNECO AUTOMOTIVE: Appoints Kenneth R. Trammell as New CFO ----------------------------------------------------------- Tenneco Automotive (NYSE: TEN) announced that Kenneth R. Trammell has been named senior vice president and chief financial officer. He was the company's vice president and controller and has been serving as interim CFO since July of this year. The appointment is effective immediately. Mr. Trammell has served as Tenneco Automotive vice president and controller since November 1999 when the company became a stand- alone entity. He joined Tenneco Inc. in 1996 as assistant controller and was promoted to corporate controller the following year. Since joining Tenneco, he has been responsible for financial and operational accounting, financial reporting, planning and analysis and all audit functions. In addition, since 1996, Mr. Trammell has had a key part in several strategic transactions completed by Tenneco Inc., including the one that created Tenneco Automotive as a stand-alone company. "Ken has played an integral role in establishing and leading a very effective corporate finance organization worldwide and I am extremely pleased to promote him to this key leadership position," said Mark P. Frissora, chairman and CEO, Tenneco Automotive. "He brings exceptional depth of experience in all areas of finance, outstanding strategic planning skills and strong leadership abilities to the CFO position." Prior to joining Tenneco Inc., Mr. Trammell was with Arthur Andersen LLP for 12 years where he was responsible for audits and consultation on mergers, acquisitions and divestitures for the firm's corporate clients. Mr. Trammell, 42, holds a bachelor's degree in accounting from the University of Houston and earned his CPA certificate in Texas. He is also a member of the Financial Executive International Committee on Corporate Reporting, a group of Fortune 500 controllers that monitors, reviews and establishes positions on financial accounting directives. Ken Trammell is on the company's senior management team and will report to Chairman and CEO Mark Frissora. Mr. Trammell resides in Lake Forest, Illinois with his wife and two daughters. Tenneco Automotive is a $3.5 billion manufacturing company with headquarters in Lake Forest, Illinois and approximately 19,600 employees worldwide. Tenneco Automotive is one of the world's largest producers and marketers of ride control and exhaust systems and products, which are sold under the Monroe(R) and Walker(R) global brand names. Among its products are Sensa- Trac(R) and Monroe Reflex(R) shocks and struts, Rancho(R) shock absorbers, Walker(R) Quiet-Flow(R) mufflers and DynoMax(R) performance exhaust products, and Monroe(R) Clevite(R) vibration control components. * * * Ratings Status As reported in Troubled Company Reporter's June 5, 2003 edition, Fitch Ratings affirmed Tenneco Automotive Inc.'s senior secured bank debt at 'B+' and subordinated debt at 'B-'. In addition, Fitch assigned a rating of 'B' to the $300 million senior secured notes to be issued under 144A, with silent second lien, due in 2013. Meanwhile, as previously reported, Standard & Poor's Ratings Services revised its outlook on Tenneco Automotive Inc. to stable from negative. At the same time, Standard & Poor's assigned its 'CCC+' rating to TEN's offering of $300 million senior secured notes, with a second lien, due in 2013 (144A with registration rights). The outlook revision reflects Lake Forest, Illinois-based TEN's improved credit-protection measures achieved in the past year and enhanced liquidity stemming from the pending issuance of the $300 million senior secured notes. In addition, Standard & Poor's affirmed its 'B' corporate credit rating on TEN and its other ratings. TOM BROWN: S&P Assigns Speculative Grade Credit & Debt Ratings -------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BB+' corporate credit rating to Tom Brown Inc. At the same time, Standard & Poor's assigned its 'BB-' subordinated debt rating to Tom Brown's proposed $225 million senior subordinated notes due 2013, and its preliminary 'BB' senior unsecured debt and preliminary 'BB-' subordinated debt ratings to Tom Brown's $500 million shelf registration to sell debt securities, preferred and common stock, depository shares, and other securities. The outlook is stable. Denver, Colorado-based Tom Brown had approximately $544 million of debt outstanding as of June 30, 2003. "The ratings on Tom Brown reflect the risks posed by its participation in the fiercely competitive, volatile, and capital intensive exploration and production segment of the oil and gas industry, slightly worse than average finding and development costs that, if continued, would require average or stronger prices to ensure sufficient cash flow for reserve replacement, and its acquisitive growth strategy," said Standard & Poor's credit analyst Paul Harvey. "Mitigating these risks at the current rating level are the company's relatively strong financial profile, competitive cash production costs, and good reserve life," added Mr. Harvey. The stable outlook reflects the expectation that Tom Brown will maintain moderate financial leverage, while continuing a capital expense program that limits exploration drilling to roughly 25% of spending. Acquisitions should be financed in a balanced manner. The proposed subordinated note offering, along with an expected common equity offering of roughly $150 million, will be used to refinance an existing bridge loan used to finance Tom Brown's recent acquisition of Matador Petroleum Corp. The current ratings on Tom Brown assume the successful completion of both proposed debt and equity offerings. Denver, Colorado-based Tom Brown is a medium-sized independent exploration and production company with pro forma year-end 2002 proved reserves of 1.02 trillion cubic feet equivalent (cfe), which was 89% natural gas and 73% proved developed, including the recently closed acquisition of Matador Petroleum. TOP-FLITE GOLF: Callaway Golf Names Bob Penicka President/COO ------------------------------------------------------------- Callaway Golf Company (NYSE:ELY) announced that Bob Penicka will be appointed as President and Chief Operating Officer of Top- Flite(R) Golf Company, a wholly-owned subsidiary of Callaway Golf, upon the completion of the acquisition of Top-Flite's assets later this month. Mr. Penicka, 41, who joined Callaway Golf in 1997, had most recently been Executive Vice President of Manufacturing in golf club and golf ball operations since June of 2001. Callaway Golf received approval from the U.S. Bankruptcy Court in Wilmington, Delaware, to acquire the assets of Top-Flite Golf Company on September 4, 2003. Closing is expected to occur near the middle of September. "This is a logical transition for an experienced Callaway Golf leader," said Ron Drapeau, Chairman, President and CEO of Callaway Golf. "As a key member of our senior management team, Bob has demonstrated his knowledge of the industry and his ability to take on new challenges. I am confident that he and the rest of the Top- Flite management team will maximize our opportunities with this acquisition." "I am honored to take on the new responsibilities of President and COO for the Top-Flite subsidiary," Mr. Penicka said. "I welcome the opportunity to work with the dedicated and talented team of professionals at Top-Flite to build on the great tradition of the Company and on the powerful Top-Flite brands." Callaway Golf Company makes and sells Big Bertha(R) Metal Woods and Irons, including Great Big Bertha(R) II Titanium Drivers and Fairway Woods, Big Bertha Steelhead(TM) III Stainless Steel Drivers and Fairway Woods, Hawk Eye(R) VFT(R) Tungsten Injected(TM) Titanium Irons, Big Bertha Stainless Steel Irons, Steelhead X-16(TM) and Steelhead X-16 Pro Series Stainless Steel Irons, and Callaway Golf Forged Wedges. Callaway Golf Company also makes and sells Odyssey(R) Putters, including White Hot(R), TriHot(R), DFX(TM) and Dual Force(R) Putters. Callaway Golf Company makes and sells the Callaway Golf(R) HX(R) Blue and HX Red balls, the CTU 30(R) Blue and CTU 30 Red balls, the HX 2-Piece Blue and HX 2-Piece Red balls, the CB1(R) Blue and CB1 Red balls, and the Warbird(TM) golf balls. For more information about Callaway Golf Company, visit its Web sites at http://www.callawaygolf.comand http://www.odysseygolf.com The Top-Flite Golf Company, formerly part of Spalding Sports Worldwide, is the world's largest golf ball manufacturer. It is the first U.S. manufacturer of golf balls, dimpled golf balls, two-piece golf balls, multi-layer golf balls, and American-made golf clubs. Under The Top-Flite Golf Company umbrella are the TOP- FLITE, STRATA and BEN HOGAN brands. Top-Flite Golf filed for Chapter 11 protection on June 30, 2003 in the U.S. Bankruptcy Court for the District of Delaware (Lead Bankr. Case No. 03- 12002). TWINLAB CORP: Gets Interim Nod for $35 Million DIP Financing ------------------------------------------------------------ Twinlab Corporation (OTCBB: TWLBE), Twin Laboratories Inc. and Twin Laboratories (UK) Ltd. announced that the United States Bankruptcy Court for the Southern District of New York granted critical "first-day motions" submitted in conjunction with the Company's September 4, 2003 filing of voluntary cases under chapter 11 of the Federal Bankruptcy Code. The Company's voluntary petitions are pending before the Honorable Cornelius Blackshear and are being jointly administered under Case No. 03-15564 (CB). The Company filed first-day motions as a proactive step to preserve its normal business operations, during the chapter 11 process, to the maximum extent possible. Final hearings on certain motions, and the hearing to approve the bidding and sale procedures and other administrative matters, will be addressed in the near future. The Company remains in possession of its assets and properties and continues to operate its businesses and manage its properties as a debtor-in-possession pursuant to sections 1107(a) and 1108 of the Federal Bankruptcy Code. The Company announced that it has entered into an asset purchase agreement with IdeaSphere, Inc. of Grand Rapids, Michigan pursuant to which the Company will sell substantially all of its assets. The sale is being conducted pursuant to section 363 of the Federal Bankruptcy Code and, as such, remains subject to mandatory bankruptcy procedures and the approval of the Bankruptcy Court. The sale is also subject to satisfaction of other standard and customary conditions, including the receipt of regulatory approvals. The Company also announced that it has obtained interim approval from the Bankruptcy Court to access up to $8.8 million of a new $35 million debtor-in-possession financing facility provided by The CIT Group/Business Credit, Inc., as agent for a lender group. Funds from this facility will now be available to the Company, along with its cash flow from operations, to help fund its operations during the chapter 11 process. A final hearing to allow use of the full $35 million debtor-in possession facility is scheduled for September 25, 2003. Additional Twinlab information is available on the World Wide Web at: http://www.twinlab.com UNITED AIRLINES: Inks Court-Approved Pact with SkyWest Airlines --------------------------------------------------------------- SkyWest Airlines, a subsidiary of SkyWest, Inc. (Nasdaq: SKYW), announces that the Memorandum of Understanding signed with United Airlines on May 30, 2003, has been converted to a definitive agreement which has been approved by the SkyWest Board of Directors, United Airlines, and the U.S. Bankruptcy Court. SkyWest was the first regional airline to sign a MOU for growth aircraft with United, and SkyWest is now the first regional airline to complete a court approved agreement. The agreement between SkyWest and United is a long-term, 11-year contract, which includes multi-year fixed rate adjustments for SkyWest's United Express contract flying. The agreement is similar in nature to the previous agreement and provides for a base margin and performance based incentives. The agreement calls for SkyWest to more than double its regional jet fleet over the next five years, which SkyWest management believes will represent the largest growth opportunity afforded any regional airline currently doing business with United. Under the terms of the definitive agreement, SkyWest has agreed to operate a fleet of 140 aircraft, including 55 turbo-prop aircraft, currently serving the United Express fleet, 50, 50-seat regional jet aircraft which are scheduled to be in service by the end of 2003, and 30, 70-seat regional jets that are scheduled to be serving United Express routes by summer 2005. Delivery of the new 70-seat jets is slated to begin in January of 2004. Additionally, the agreement includes a significant number of options, which are expected to be a mix of 50 and 70-seat regional jets and will be determined by United at a later date. "The agreement represents the culmination of many cooperative efforts between SkyWest and United since United entered bankruptcy protection in December 2002," said Bradford R. Rich, Executive Vice President, Chief Financial Officer and Treasurer of SkyWest. "In addition, we believe this agreement is unprecedented in our industry and offers us significant long-term growth opportunities that will greatly benefit SkyWest and our shareholders. We also believe the agreement will greatly benefit United as we are offering them a high quality, economic product designed to help them achieve their financial objectives." Currently SkyWest operates more than 670 daily flights to 63 cities as United Express out of hubs in Denver, Los Angeles, Portland, San Francisco, and Seattle. The contract will provide SkyWest with new opportunities in United's Chicago hub as well as expanded service in the Denver market. SkyWest Airlines is the nation's largest independently operated regional carrier and carried 8.23 million passengers last year. The US Department of Transportation has recognized SkyWest as the number one on-time airline in the United States five out of the last six months. SkyWest operates as United Express, Continental Connection and Delta Connection carriers under marketing agreements with United Airlines, Continental Airlines and Delta Air Lines, respectively. SkyWest serves a total of 103 cities in 28 states and two Canadian provinces and has more than 1,100 daily departures. Information on SkyWest can be accessed at http://www.skywest.com UNITED AIRLINES: HSBC Seeks Stay Relief to Access LA Const. Fund ---------------------------------------------------------------- HSBC Bank USA, in its capacity as successor trustee between the California Statewide Communities Development Authority and Chase Manhattan Bank and Trust Company, asks Judge Wedoff to hold that either the automatic stay is not applicable or is modified so it can exercise its set-off rights. HSBC wants to apply and disburse trust funds that it holds in a Construction Fund for the benefit of the bondholders of the California Statewide Communities Development Authority Special Facilities Revenue Bonds, Series 1997 (United Air Lines, Inc. -- Los Angeles International Airport Projects) issued on November 1, 1997 for $190,240,000. The Bonds were issued to finance the construction, modification and expansion of buildings at Los Angeles International Airport. Harold L. Kaplan, Esq., at Gardner, Carton & Douglas, asserts that the money in the Construction Fund is not property of United's estate because it is held in trust for the benefit of the Bondholders. United has no equity in the money. The Bonds are secured by a pledge and assignment to the Trustee securing payment of principal and interest on the Bonds. On April 1, 2003, United defaulted on its payment installment. Since an event of default occurred, HSBC has a perfected lien on the money in the Construction Fund to secure payment of the Bonds in accordance with the Trust Agreement. Mr. Kaplan reminds the Court that HSBC already exercised its rights on certain reserve accounts before. HSBC now seeks to exercise its rights with respect to the Construction Funds. As of the Petition Date, about $37,000,000 was held by HSBC on deposit in the Construction Fund. About $190,240,000 in principal remained outstanding on the Bonds. (United Airlines Bankruptcy News, Issue No. 26; Bankruptcy Creditors' Service, Inc., 609/392-0900) URSTADT BIDDLE: Reports Improved Third Quarter Financial Results ---------------------------------------------------------------- Urstadt Biddle Properties Inc. (NYSE:UBA and UBP), a real estate investment trust, announced its third quarter and first nine months financial results for the periods ended July 31, 2003. Diluted funds from operations for the quarter ended July 31, 2003 increased to $7,283,000 or $0.27 per Common share and $0.30 per Class A Common share on higher shares outstanding compared to $5,209,000 or $0.25 per Common share and $.28 per Class A Common share in the third quarter of fiscal 2002. Net income applicable to Common and Class A Common stockholders for the quarter was $4,527,000 or $0.17 per diluted Common share and $0.19 per diluted Class A Common share, compared to $2,958,000, or $0.15 per diluted Common share and $0.16 per diluted Class A Common share in the corresponding three month period last year. For the first nine months of fiscal 2003, diluted FFO increased to $20,792,000 or $0.76 per Common share and $0.84 per Class A Common share from $15,098,000 or $0.80 per Common share and $0.88 per Class A Common share for the same period in fiscal 2002. Net income applicable to Common and Class A Common stockholders for the first nine months of fiscal 2003 was $12,920,000 or $0.48 per diluted Common share and $0.54 per diluted Class A Common share compared to $12,081,000 or $0.65 per diluted Common share and $0.72 per diluted Class A Common share, for the same period last year. Net income in the nine-month period in fiscal 2002 included a gain of $3,071,000 on the repurchase of a portion of the Company's Series B preferred shares last year. Commenting on the quarter's operating results, Willing L. Biddle, President and Chief Operating Officer of UBP, said "The increase in the Company's FFO and revenue growth is largely a result of recent shopping center acquisitions and new leasing completed over the past eighteen months. In this fiscal year alone, we have purchased four shopping centers totaling 438,000 square feet at a cost of $84 million. These purchases are in addition to the nearly $100 million in properties we acquired last year." Mr. Biddle also noted that "In May 2003, we sold 400,000 shares of a new issue of 8.5% Series C Cumulative Preferred Stock. The shares pay dividends at 8.5% per annum, payable quarterly and have been approved for listing on the New York Stock Exchange. We used $21.7 million of the net proceeds raised in the offering to acquire seven retail building units at the Somers Commons Shopping Center in Somers, New York during the quarter." Mr. Biddle continued, "We expect to acquire additional shopping centers in our target region of Fairfield County, Connecticut and Westchester and Putnam Counties in New York when opportunities arise." Non-GAAP Financial Measure Funds from Operations A reconciliation of FFO to net income applicable to Common and Class A Common stockholders, the GAAP measure the Company believes to be the most directly comparable, is in the financial tables accompanying this press release. The Company believes that FFO is an appropriate financial measure of operating performance of an equity REIT. Although FFO is a non- GAAP financial measure, the Company believes it provides useful information to shareholders, potential investors and management. The Company computes FFO in accordance with standards established by the National Association of Real Estate Investment Trusts. FFO is defined by NAREIT as net income or loss, excluding gains (or losses) from debt restructuring and sales of properties plus depreciation and amortization, and after adjustments for unconsolidated joint ventures. FFO does not represent cash generated from operating activities in accordance with GAAP and is not indicative of cash available to fund cash needs. FFO should not be considered as an alternative to net income as an indicator of the Company's operating performance or as an alternative to cash flow as a measure of liquidity. Since all companies do not calculate FFO in a similar fashion, the Company's calculation of FFO presented herein may not be comparable to similarly titled measures as reported by other companies. UBP is a self-administered equity real estate trust providing investors with a means of participating in ownership of income- producing properties with investment liquidity. UBP has paid 135 quarters of uninterrupted dividends since its inception in 1969. As reported in Troubled Company Reporter's June 4, 2003 edition, Fitch Ratings assigned a 'BB' rating to an offering of $40 million 8.5% series C cumulative preferred securities by Urstadt Biddle Properties Inc. (NYSE: UBA). Fitch also affirmed the 'BB' rating on UBA's outstanding $15 million 8.99% series B cumulative preferred securities. The Rating Outlook is Stable. URSTADT BIDDLE: Board of Directors Declares Quarterly Dividends --------------------------------------------------------------- At their regular meeting Wednesday, the Directors of Urstadt Biddle Properties Inc., (NYSE: UBA and UBP) declared quarterly dividends on the Company's Class A Common Stock and Common Stock. The dividends were declared in the amount of $0.21 for each share of Class A Common Stock and $0.19 for each share of Common Stock. The dividends are payable October 17, 2003 to stockholders of record on September 26, 2003. The dividends were declared at the same rates as the previous quarter and represent the 135th consecutive quarterly dividends on common shares declared since the Company began operating in 1969. The Directors of UBP also declared the regular quarterly dividends on the Company's Series B Preferred Stock and Series C Preferred Stock. The dividends were declared in the amount of $2.2475 for each share of Series B Preferred Stock and $2.125 for each share of Series C Preferred Stock. The dividends are payable October 31, 2003 to stock holders of record on October 17, 2003. UBP is a self-administered equity real estate investment trust providing investors with a means of participating in ownership of income-producing properties and investment liquidity. UBP owns 30 properties containing 3.4 million square feet of space. UBP's core properties consist principally of community shopping centers located in the northeast with a concentration in the Fairfield County, Connecticut and Westchester and Putnam Counties, New York areas. US AIRWAYS GROUP: Oaktree Fund Discloses 3.9% Equity Stake ---------------------------------------------------------- Oaktree Capital Management, LLC is the sole general partner of OCM Principal Opportunities Fund II, L.P., which holds 1,871,600 shares of Class A common stock of US Airways Group Inc., which constitutes 3.9% of the outstanding shares of Class A common stock. 3.9% is attributable to the shares beneficially owned by OCM but the combined 4,679,000 shares of Class A common stock beneficially owned by the Purchase Group represents 9.7% of the number of shares of Class A common stock of US Airways Group outstanding. OCM Principal Opportunities Fund II, L.P., Aviation Acquisition, L.L.C., which is managed by Farallon Capital Management, L.L.C., and Goldman, Sachs & Co. purchased, in aggregate, 4,679,000 shares of Class A common stock of US Airways Group in a private placement which closed in two installments in August 2003. Certain terms and conditions in connection with such parties investment in the Class A common stock, including the signing by the Oaktree Fund, Aviation Acquisition, L.L.C., Goldman Sachs & Co., the limited liability company members of Aviation Acquisition, L.L.C. and US Airways Group of a certain Stockholder Agreement, dated August 14, 2003, as amended by Amendment No. 1 to the Stockholder Agreement, dated August 27, 2003, could be deemed to make the holders of the stock, Aviation Acquisition, L.L.C., Farallon Capital Management, L.L.C., the managing members of Farallon Capital Management, L.L.C. , Goldman Sachs & Co. and The Goldman Sachs Group, Inc., the parent holding company of Goldman Sachs & Co., members of a group as defined by Rule 13d-5(b) of the Securities Exchange Act of 1934, as amended. Pursuant to Rule 13(d)-5(b) of the Exchange Act, each member of the Purchase Group may be deemed to beneficially own any equity securities of US Airways Group Inc. that the other members of the group beneficially own. Oaktree and OCM disclaim any beneficial ownership of the 2,807,400 shares owned by the other members of the Purchase Group. Each of the Oaktree Fund and Oaktree may be deemed to share the power to vote and dispose of the shares of Class A common stock. Oaktree and the Oaktree Fund by virtue of their possible membership in the Purchase Group may be deemed to beneficially own the 1,871,600 shares of Class A common stock owned directly by Aviation Acquisition, L.L.C. and/or the 935,800 shares of Class A common stock owned directly by Goldman, Sachs & Co. The Company's primary business activity is the ownership of the common stock of US Airways, Inc., Allegheny Airlines, Inc., Piedmont Airlines, Inc., PSA Airlines, Inc., MidAtlantic Airways, Inc., US Airways Leasing and Sales, Inc., Material Services Company, Inc. and Airways Assurance Limited, LLC (collectively, the "Wholly-Owned Subsidiaries"). The primary business activity of the Wholly-Owned Subsidiaries is the transportation of passengers, property and mail. VERITAS DGC: Commences Search For New Chief Executive Officer ------------------------------------------------------------- Veritas DGC Inc. (NYSE & TSX: VTS) announced that David B. Robson has advised the company's board of directors of his intention to step down as chief executive officer when a suitable replacement can be found. He cited health reasons for his decision to retire. To effect an orderly transition, Mr. Robson will continue as a director and as chairman of Veritas. A committee appointed by the board of directors of Veritas will conduct a search for qualified candidates with the assistance of executive search firm Spencer Stuart. The committee will consider internal candidates as well as those identified as a result of the search. It is the intention of the board of directors to have a new chief executive officer in place by the end of 2003. Veritas DGC Inc. (Fitch, BB Senior Secured Debt Rating, Negative), headquartered in Houston, Texas, is a leading provider of integrated geological and reservoir technologies to the petroleum industry worldwide. VERTIS INC: Appoints New East and West Group Presidents ------------------------------------------------------- Vertis Inc., a leading provider of technology-based targeted marketing and advertising solutions, announced that Dave Colatriano and Tom Zimmer will assume the expanded roles of group president, Vertis East and group president, Vertis West, respectively. The creation of these new positions comes as a result of the company's decision to focus on an integrated management structure of sales and operations, and several business units of the company will now report on an East/West basis to Colatriano and Zimmer. "Both Dave and Tom are valuable assets to the company and they have the extensive industry knowledge and experience to take on this added responsibility," said Herb Moloney, chief operating officer for Vertis. "The consolidated East/West structure will allow us to continue to fully integrate our service offering for our customers and ensure we remain at the forefront of the targeted advertising and marketing industry." Prior to his promotion to group president, Vertis East, Colatriano served as group president of Vertis Direct Marketing Services in North Brunswick, N.J., since July 2000. He joined Vertis Direct Marketing Services (formerly Webcraft) in 1987, having worked as an industrial engineer with the Boeing Company. As part of Colatriano's additional responsibilities, directors from Vertis Advertising Production Services East and Vertis Retail & Newspaper Services East will report directly to him. Zimmer has been group president of Vertis Retail & Newspaper Services West in Upland, Calif. since July 2000. With more than 30 years experience in the printing industry, Zimmer joined Vertis Retail & Newspaper Services (formerly TC Advertising) in 1970 and has held positions ranging from prepress manager to director, pricing and estimating. In his new position, Zimmer will have directors from Vertis Advertising Production Services West and Vertis Direct Marketing Services West reporting directly to him. Vertis is a global powerhouse for integrated marketing and advertising solutions that seamlessly combine advertising, direct marketing, media, imaging and progressive technology. With headquarters in Baltimore, Md., with production and sales offices throughout the U.S. and United Kingdom, Vertis serves local, regional, national and international companies across diverse industries. Vertis' products and services include: consumer and media research, media planning and placement, creative services, digital media production, targetable advertising insert programs, fully integrated direct marketing programs, circulation-building newspaper products and interactive marketing. To learn more about Vertis, visit http://www.vertisinc.com As reported in Troubled Company Reporter's May 27, 2003 edition, Standard & Poor's Ratings Services assigned its 'B-' rating to Vertis Inc.'s $350 million 9.75% senior secured second lien notes due April 1, 2009. The notes were sold at a discount to yield 10.375%, and proceeds will be used to repay amounts outstanding under the company's existing bank facility. At the same time, Standard & Poor's affirmed its 'B+' corporate credit rating and other ratings for the company. Upon retirement of the term A and B loans, Standard & Poor's will raise the senior secured debt rating of the company to 'BB-' from 'B+'. The outlook is negative for this Baltimore, Maryland-headquartered advertising and marketing services company. WESTPOINT STEVENS: Selling 22 European Dept. Store Concessions -------------------------------------------------------------- WestPoint Stevens (Europe) Ltd. is selling its retail business that trades through 22 large department store concessions, primarily in the United Kingdom and France. The wholesale operation includes over 600 customer accounts throughout Europe. WestPoint Europe customers include Harrods, Harvey Nichols, House of Fraser, John Lewis, Selfridges and El Cortes Ingles. According to the Joint Administrators, N. G. Edwards and N. B. Kahn, the business achieves a GBP17,000,000 turnover and employs 123 personnel. Other assets that will be sold include finished goods and work-in-progress stocks as well as exclusive license and distribution agreements. (WestPoint Bankruptcy News, Issue No. 8; Bankruptcy Creditors' Service, Inc., 609/392-0900) WILLIAMS COMPANIES: Enters Transactions to Sell Non-Core Assets --------------------------------------------------------------- Williams (NYSE: WMB) has entered into two transactions for the sale of assets the company has previously identified for divestiture. In Canada, Williams is selling the natural gas liquids fractionation, storage and distribution business at its Redwater, Alberta, plant to Provident Energy Trust for approximately $218 million in U.S. funds. Under the terms of the agreement, Provident will pay $196 million cash for assets, along with an additional amount for natural gas liquids inventories estimated at $22 million as of Aug. 1. The assets include a 62,000-barrel-per-day fractionation plant at Redwater, 350 miles of gathering systems, related storage facilities and a 43.3 percent interest in a 38,500-barrel-per-day natural gas liquids extraction plant at Taylor, British Columbia. Williams is retaining the olefins fractionator and a portion of the storage and distribution assets at the Redwater complex, which is located roughly 64 kilometers northeast of Edmonton. "We've made a lot of progress this year stabilizing our finances and transforming our company," said Steve Malcolm, chairman, president and chief executive officer. "We have stated a clear intent to concentrate our commercial strategy on natural gas production, processing and pipeline transportation, primarily in the United States. Cleaning up our asset slate creates a healthier, more focused Williams." The Redwater sale is scheduled to close on or before Sept. 30, subject to standard closing conditions. Williams expects to record a pre-tax gain of approximately $87 million related to the Redwater sale. In Colorado, Williams has sold its investment in American Soda, LLP to a wholly-owned affiliate of Solvay America, Inc. The operation near Parachute, Colo., is designed to produce approximately 1 million tons of soda ash per year. Williams does not expect to recognize a significant gain or loss related to the soda ash transaction. Including this announcement, Williams this year has sold or agreed to sell assets and certain contracts for in excess of $3.1 billion in aggregate cash. Williams (S&P, B+ Long-Term Corporate Credit Rating, Negative), through its subsidiaries, primarily finds, produces, gathers, processes and transports natural gas. Williams' gas wells, pipelines and midstream facilities are concentrated in the Northwest, Rocky Mountains, Gulf Coast and Eastern Seaboard. More information is available at http://www.williams.com WORLD AIRWAYS: Inks New $70 Million Contract with TM Travel ----------------------------------------------------------- World Airways, Inc. (Nasdaq: WLDA) announced a new contract with TM Travel to provide service between Honolulu, Hawaii, and Las Vegas, Nevada. The initial service will begin on September 17, 2003. This service will utilize an MD-11 passenger aircraft with enhanced legroom in both business and economy class. TM Travel and World Airways have the option to extend the contract beyond its current expiration date of December 2005. Hollis Harris, chairman and chief executive officer of World Airways, said, "This contract is evidence of our success in expanding our reach to new customers and in diversifying our revenue base. We're pleased that business development efforts are paying dividends in the form of new customers, and we will continue to target additional business opportunities this year." Utilizing a well-maintained fleet of international range, wide- body aircraft, World Airways has an enviable record of safety, reliability and customer service spanning more than 55 years. The Company is a U.S. certificated air carrier providing customized transportation services for major international passenger and cargo carriers, the United States military and international leisure tour operators. Recognized for its modern aircraft, flexibility and ability to provide superior service, World Airways meets the needs of businesses and governments around the globe. For more information, visit the Company's Web site at http://www.worldair.com World Airways Inc.'s March 31, 2003 balance sheet shows a working capital deficit of about $22 million, and a total shareholders' equity deficit of about $22 million. WORLDCOM INC: Asks Court to Approve McLeod Settlement Agreement --------------------------------------------------------------- Before the Petition Date, certain MCI entities and McLeod USA Telecommunications Services Inc., CapRock Telecommunications Corp., MWR Telecom, Inc., QST Communications Inc. and Intellispan, Inc. entered into various agreements for the purchase of telecommunications services from each other. These MCI entities include MCImetro Access Transmission Services LLC, MCI WorldCom Network Services Inc., Intermedia Communications Inc., MCI WorldCom Communications Inc., Brooks Fiber Properties Inc. and UUNET Technologies Inc. As a result of the business relationship, the Debtors allege that McLeod owe them $15,534,097 in prepetition debt. However, McLeod disputes a total of $17,165,689 in charges, which includes an additional $1,631,592 that it has already paid to the Debtors. Meanwhile, McLeod asserts that the Debtors owe it $10,876,391 in prepetition debt. The Debtors dispute $832,438 of this amount. After arm's-length negotiations, the parties agree to resolve the dispute. The parties decide to effectuate mutual setoffs and apply credits to their prepetition obligations. The setoffs and credits will result in a reduction of the MCI Debt while yielding a recovery from McLeod. Specifically, the settlement operates in this manner: -- McLeod will apply a $690,923 credit to the MCI Entities' accounts to reduce the MCI Debt to $10,185,468; -- The Debtors will apply a $5,800,000 credit to McLeod's accounts to reduce the McLeod Debt to $9,734,097; -- The parties have agreed to offset their prepetition debts for $7,967,838. The Debtors will file the required notices in their Chapter 11 proceeds to effect the setoff; -- The parties agree to negotiate in good faith towards the resolution of payment with respect to the McLeod Balance and the MCI Balance; -- On the effective date of the Setoff Notices, McLeod will amend any and all proofs of claim filed in the Debtors' cases to reflect the reduction of the McLeod Claim; and -- The parties will execute mutual releases with respect to the services rendered. The Debtors believe that the Settlement is fair and reasonable and in now way unjustly enriches any of the parties. Accordingly, the Debtors ask the Court to approve the Settlement. (Worldcom Bankruptcy News, Issue No. 36; Bankruptcy Creditors' Service, Inc., 609/392-0900) * Goodwin Procter LLP Announces New Partnership Elections --------------------------------------------------------- Goodwin Procter LLP announced that nine attorneys have been elected to the partnership, effective October 1, 2003. The newly- elected partners are: Boston Stephen T. Adams, corporate department James M. Curley, corporate department Lisa R. Haddad, corporate department Christopher D. Moore, litigation department Jackie L. Segel, litigation department William E. Stern, corporate department New York Christopher J. Garvey, litigation department Eric P. Meyerowitz, corporate department Keith A. Zullow, litigation department Goodwin Procter LLP is one of the nation's leading law firms, with nearly 500 attorneys. The firm focuses on a number of specialized areas including, corporate/transactional, litigation, real estate, financial services, and intellectual property. Goodwin Procter is headquartered in Boston, with offices in New York, New Jersey and Washington, D.C. Additional Biographic Information: Boston Stephen T. Adams is a member of the firm's M&A/Corporate Governance Practice, as well as the Energy Practice Group. He focuses his practice primarily on mergers and acquisitions and securities law. James M. Curley dedicates most of his time to investment transactions of private equity funds and relationships with emerging growth companies. Mr. Curley is a member of the firm's Private Equity Group. Lisa R. Haddad has experience in a wide variety of corporate and securities matters, including underwritten public offerings and private placements of debt and equity securities, mergers and acquisitions and securities law compliance for public companies. Ms. Haddad is a member of the M&A/Corporate Governance Practice and the REITs & Real Estate Securities Practice. Christopher D. Moore has represented a number of public and private companies in a range of complex business litigation matters during his time as a member of the firm's Litigation Department. Mr. Moore's primary areas of practice are securities and corporate governance, SEC and stock exchange investigations, real estate partnership disputes, civil RICO defense, and litigation arising out of mergers and acquisitions. Jackie L. Segel, a member of the firm's Litigation Department, represents clients in civil matters, with a primary focus on complex products liability litigation. William E. Stern, an attorney in the Financial Services Group, advises clients on bank regulatory matters relating to domestic and foreign investments and activities, including merchant banking, personal and real property leasing, lending, captive reinsurance, trust department operations and other types of financial activities. New York Christopher J. Garvey concentrates his practice primarily in the defense of complex products liability and toxic and environmental exposure matters. Mr. Garvey is also experienced in matters involving bankruptcy litigation, corporate and complex commercial and securities litigation, and franchise and trademark law. Eric P. Meyerowitz focuses his practice on diverse private equity, corporate and securities matters and on complex financing transactions within the Private Equity Group and the Energy Practice Group. His practice includes mergers and acquisition work, private placements of equity and debt securities, securitization transactions, and secured and unsecured financing transactions. Keith A. Zullow centers his practice on patent and trade secret issues, patent interference activities and patent prosecution. Mr. Zullow is a member of the firm's Litigation Department. * Moody's Publishes First Canadian Corporate Bond Default Study --------------------------------------------------------------- Defaults by Canadian corporate bond issuers have increased in pace with the global trend in the last half-decade, but have trended downward over the last two years, Moody's Investors Service reports with the release of its first Canadian corporate bond default study. The study analyzes the issuance, rating migration, default, and recovery and loss rates of corporate bond issuers domiciled in Canada from 1989 to the present. Although Moody's has been rating Canadian corporate bond issuers since 1909, this study is the first to focus on defaults since the rise of high-yield bonds as a distinct asset class. The rise in the default rate for Canadian corporate issuers tracks the increase in issuance of speculative grade rated debt in the late 1990s. "Once largely dominated by investment grade issuers in the financial and energy sectors, the Canadian corporate bond market has diversified and matured quickly, particularly the speculative grade segment of this market," says Andrew J. Kriegler, managing director of Moody's Canada. "Today, speculative- grade issuers constitute about one-third of the Canadian corporate bond market, roughly the same as in the U.S." Yet, despite the recent rise in defaults by Canadian corporate bond issuers, default rates are, on average, somewhat lower relative to the U.S. and the rest of the world. The one-year average default rate for all rated Canadian firms is 1.9%, compared to 2.4% for U.S. firms. From 1989-2002, 53 Canadian issuers defaulted on a total of C$29 billion of bonds. Of these, 30 issuers, totaling C$26 billion, were rated by Moody's. The report also reveals a strong correlation between Moody's ratings and the probability of default. The study finds that most Canadian issuers that subsequently defaulted had carried deep speculative-grade ratings well in advance of default. Within one year of defaulting, the typical Canadian defaulter was rated Caa1, which is two notches lower than the ratings of U.S. companies one year before default. "The rating transition rates of Canadian corporate issuers at the whole-letter rating level closely resemble those of their U.S. counterparts," says David T. Hamilton, vice president/senior credit officer and one of the authors of the study. The authors found that 89% of Canadian issuers' ratings remained unchanged over one year, while 10% experienced a one-notch upgrade or downgrade. However, Canadian issuers, particularly in the speculative-grade category, were slightly more likely than U.S. issuers to experience an upgrade than a downgrade. Moody's study also found that recovery rates for Canadian corporate bonds are generally lower relative to those of U.S. issuers. Senior unsecured bondholders recovered 30% of par, on average, in Canada over the 1989-2002 period, compared to 42% in the U.S. "However, the defaulted debt of telecommunications issuers represents a large proportion of defaulted Canadian bonds. The low recovery rate for this sector further skews the Canadian averages," adds Sharon Ou, associate analyst and co-author of the report. Excluding the bonds of telecommunications issuers from the data raises the average recovery on Canadian corporate bonds to 39%. The report, titled "Default & Recovery Rates of Canadian Corporate Bond Issuers, 1989-2002," is available on http://www.moodys.ca It includes a chronological list of Canadian public bond defaults, as well as select default summaries. * BOOK REVIEW: Risk, Uncertainty and Profit ------------------------------------------- Author: Frank H. Knight Publisher: Beard Books Softcover: 381 pages List Price: $34.95 Review by Gail Owens Hoelscher Order your personal copy today at http://www.amazon.com/exec/obidos/ASIN/1587981262/internetbankrupt The tenets Frank H. Knight sets out in this, his first book, have become an integral part of modern economic theory. Still readable today, it was included as a classic in the 1998 Forbes reading list. The book grew out of Knight's 1917 Cornell University doctoral thesis, which took second prize in an essay contest that year sponsored by Hart, Schaffner and Marx. In it, he examined the relationship between knowledge on the part of entrepreneurs and changes in the economy. He, quite famously, distinguished between two types of change, risk and uncertainty, defining risk as randomness with knowable probabilities and uncertainty as randomness with unknowable probabilities. Risk, he said, arises from repeated changes for which probabilities can be calculated and insured against, such as the risk of fire. Uncertainty arises from unpredictable changes in an economy, such as resources, preferences, and knowledge, changes that cannot be insured against. Uncertainty, he said "is one of the fundamental facts of life." One of the larger issues of Knight's time was how the entrepreneur, the central figure in a free enterprise system, earns profits in the face of competition. It was thought that competition would reduce profits to zero across a sector because any profits would attract more entrepreneurs into the sector and increase supply, which would drive prices down, resulting in competitive equilibrium and zero profit. Knight argued that uncertainty itself may allow some entrepreneurs to earn profits despite this equilibrium. Entrepreneurs, he said, are forced to guess at their expected total receipts. They cannot foresee the number of products they will sell because of the unpredictability of consumer preferences. Still, they must purchase product inputs, so they base these purchases on the number of products they guess they will sell. Finally, they have to guess the price at which their products will sell. These factors are all uncertain and impossible to know. Profits are earned when uncertainty yields higher total receipts than forecasted total receipts. Thus, Knight postulated, profits are merely due to luck. Such entrepreneurs who "get lucky" will try to reproduce their success, but will be unable to because their luck will eventually turn. At the time, some theorists were saying that when this luck runs out, entrepreneurs will then rely on and substitute improved decision making and management for their original entrepreneurship, and the profits will return. Knight saw entrepreneurs as poor managers, however, who will in time fail against new and lucky entrepreneurs. He concluded that economic change is a result of this constant interplay between new entrepreneurial action and existing businesses hedging against uncertainty by improving their internal organization. Frank H. Knight has been called "among the most broad-ranging and influential economists of the twentieth century" and "one of the most eclectic economists and perhaps the deepest thinker and scholar American economics has produced." He stands among the giants of American economists that include Schumpeter and Viner. His students included Nobel Laureates Milton Friedman, George Stigler and James Buchanan, as well as Paul Samuelson. At the University of Chicago, Knight specialized in the history of economic thought. He revolutionized the economics department there, becoming one the leaders of what has become known as the Chicago School of Economics. Under his tutelage and guidance, the University of Chicago became the bulwark against the more interventionist and anti-market approaches followed elsewhere in American economic thought. He died in 1972. ********* 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 publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR subscription rate is $675 for 6 months delivered via e- mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Christopher Beard at 240/629-3300. *** End of Transmission ***