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/raid1/www/Hosts/bankrupt/TCR_Public/040217.mbx T R O U B L E D C O M P A N Y R E P O R T E R Tuesday, February 17, 2004, Vol. 8, No. 33 Headlines ACTIVISION: S&P Assigns Preliminary Debt Ratings at Low-B Levels AIR CANADA: Longacre Funds Offer 20% for CCAA Claims AIR CANADA: Lauds Alberta's Move to Eliminate Aviation Fuel Tax AK STEEL: Signs Sale Agreement for Greens Port Industrial Park ALLEGIANCE TELECOM: XO Communications Wins Bid to Acquire Assets AMERICAN HOMEPATIENT: Mellon Entities Disclose 6.46% Equity Stake AMES DEPT: Seeks Court Nod for Aug. 27 Plan-Filing Exclusivity ASSET SECURITIZATION: S&P Takes Rating Actions on 1996-D2 Notes AVADO BRANDS: Asks Court to File Schedules Up Until April 4 BLOUNT INTL: Will Webcast Q4 2003 Conference Call on February 20 BOISE CASCADE: Declares Dividends & Sets Annual Meeting in April BRIAZZ INC: Wells Fargo Reports 8.2% Equity Stake BUDGET GROUP: Airs Objections to Various Creditor Claims BUILDERS FIRSTSOURCE: S&P Cuts Rating over Plan to Increase Debt BUTLER MFG: Continues To Work With Lenders To Cure Debt Defaults CENTERPOINT ENERGY: Unit Issues Two Series Of Refunding Bonds CKE RSTAURANTS: Reports Preliminary Fourth Quarter Charges COMDISCO: Paying Contingent Distribution Rights Holders on Mar 4 COMSTOCK: S&P Ups Corporate Credit Rating to BB- over Refinancing CONSOL ENERGY: Ex-Majority Shareholder Sells Remaining Shares CONTINENTAL AIRLINES: Fitch Affirms Junk Ratings & Revises Outlook CONTINENTAL AIRLINES: Fitch Affirms EETC Ratings on 3 Note Series CREDIT SUISSE: Fitch Takes Rating Actions on 4 Securitizations DETROIT MEDICAL: Fitch Maintains Negative Watch on B Rating DIRECTV: Delaware Court Confirms First Amended Reorganization Plan D.R. HORTON: S&P Ups Credit & Senior Debt Ratings a Notch to BB+ ENCOMPASS: Todd Matherne Wants 25 Claims Disallowed & Expunged ENRON: Obtains Nod to Expand Stephen Cooper's Engagement Scope EREWHON MOUNTAIN: Hilco Merchant To Conduct Store Closing Sales ESSELTE: S&P Assigns Low-B Level Credit & Euro Sub. Note Ratings EXIDE: Obtains Clearance for Heller Stipulation Re Equipment Lease EXIDE TECH: Obtains Court Nod for $375 Million Financing Package FIRST PAGE ASSOCIATES: Case Summary & Largest Unsecured Creditors FP BROWN & SONS: Case Summary & 11 Largest Unsecured Creditors GENTEK INC: Gets Approval for Majestic Settlement Agreement GLIMCHER REALTY: Schedules Q4 2003 Conference Call on Feb. 19 GLOBAL CROSSING: Court Disallows $4.2 Million Paid Tax Claims GOODYEAR: Fitch Hatchets Debt Ratings over Accounting Concerns GOODYEAR: S&P Lowers Rating on Series 2001-34 Class A-1 Notes to B GSI GROUP: S&P Withdraws B- Credit Rating at Company's Request GUESS? INC: Will Webcast Q4 Conference Call on February 19 HANOVER DIRECT: Director Martin L. Edelman Resigns From Board HANOVER: Eliminates Executive Position for Strategic Realignment HAWK CORP: Hosting Q4 2003 Conference Call on the Web Today INSCI CORP: Stockholders' Deficit Tops $1,165,000 as of Dec 2003 ITC DELTACOM: 2004 Annual Shareholders' Meeting Slated for Apr. 27 JO-ANN STORES: S&P Assigns B- Rating to $100MM Senior Sub. Notes KMART HOLDING: Files Suit Against Martha Stewart Over Contract LEGEND INT'L: Brings-In Clyde Bailey as New Independent Auditor LTV: Gets Permission to Settle Allocation Appeals and Disputes LTX CORP: S&P Revises Outlook to Stable Following Equity Pricing MEDISOLUTION LTD: December Working Capital Deficit Tops $12 Mill. MERITAGE: S&P Raises Corporate & Sr. Unsecured Note Ratings to BB- MILLBROOK PRESS: Has Until March 12 to Complete Schedules MIRANT: Seeks Nod to Make Initial KERP Payments to Key Employees MORGAN STANLEY: Fitch Raises & Affirms Ratings on 1997-C1 Notes MORGAN STANLEY: Fitch Affirms Low-B Level Rating on Class F Notes MTS INC: Asks Court to Extend Lease Decision Time through June 30 NEW JERSEY MINING: Board Installs DeCoria Maichel as New Auditor NORAMPAC INC: Sells Corrugated Product Plant in Monterrey, Mexico NUEVO ENERGY: Fitch Places Low-B Debt Ratings on Watch Positive OHIO CASUALTY: Outlook on S&P's Ratings Revised to Stable ONE PRICE: Morgan Lewis Serves as Special Bankruptcy Counsel OWENS CORNING: Lease Decision Period Stretched to June 4, 2004 OXFORD AUTOMOTIVE: Q3 Conference Call Scheduled For February 19 PETRO STOPPING: S&P Assigns B- Rating to $225-Mil. Sr. Sec. Notes PG&E NATIONAL: Valuation Analysis under NEG's 2nd Amended Plan PHOENIX INT'L: Creditor Gerard Haryman Converts $1M Loan to Equity PICCADILLY CAFETERIAS: Agrees To Sell Assets For $80 Million PINNACLE ENT.: Gets $2M For Extending Time for Calif. Land Sale PROLOGIC MANAGEMENT: Gets Nod to Tap Felker Altfeld as Counsel PRUSSIA ASSOCIATES: Retains Dilworth Paxson as Attorney RCN HOLDING: Will Not Make Interest Payment on 10-1/8% Sr. Notes RELIANCE: Court Okays Proposed Settlement with PNC Leasing et al. REVLON CONSUMER: S&P Places Current Ratings on Watch Positive ROBOTIC VISION: Dec. 2003 Shareholder Deficit Narrows to $6.5M RURAL/METRO: December 2003 Balance Sheet Upside Down By $210 Mil. SAFFRON FUND: Board Backs Liquidation & Dissolution Proposal SALOMON BROS: S&P Hatchets Class B-3 Notes' Rating to D from CCC SIRIUS SATELLITE: S&P Rates New $250M Convertible Notes at CCC- SIRIUS SATELLITE: Prices Convertible Notes Offering SMITHFIELD FOODS: Will Host 3rd Quarter Conference Call on Feb. 24 STATION CASINOS: Sets Up Rule 105b5-1 Trading Plans for Officers STOLT OFFSHORE: Completes $100 Million Private Placement SUPERIOR ESSEX: SEC Declares Registration Statement Effective TRANSWESTERN PUBLISHING: S&P Assigns Lower-B Level Debt Ratings UBIQUITEL INC: Unit Prices $270 Million Offering of Senior Notes UAL CORP: Flight Attendants' Union Seeks to Appoint Examiner UNITEDGLOBALCOM: Raises About $1 Billion From Rights Offering WOODMERE CHINA: Case Summary & 20 Largest Unsecured Creditors WORLDCOM/MCI: WCOEQ & MCWEQ Shares May be Cancelled by April 30 WR GRACE: Seeks to Extend Plan-Filing Exclusivity to Aug. 1, 2004 * Large Companies with Insolvent Balance Sheets ********* ACTIVISION: S&P Assigns Preliminary Debt Ratings at Low-B Levels ---------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B+' corporate credit rating to Activision Inc. At the same time, Standard & Poor's assigned its preliminary 'B+' senior unsecured and 'B-' subordinated debt ratings to the debt components of Activision's $750 million rule 415 mixed shelf registration. Final ratings will be assigned if and when the company issues debt securities under the shelf registration. Net proceeds would be used for general corporate purposes, potentially including acquisitions. Santa Monica, California-based Activision had no debt outstanding at Dec. 31, 2003. The rating outlook is positive. "The ratings reflect Activision's earnings concentrations in several long-running game franchises, intensely competitive conditions in the video game industry, the hit-driven nature of the business, and some product life cycle and seasonality risks. These factors are partly mitigated by the company's several strong gaming franchises, broad user base, and good cash cushion," said Standard & Poor's credit analyst Andy Liu. Activision publishes and distributes video games for consoles, personal computers, and hand-held game machines. Although operating performance between fiscal quarters can be volatile due to differences in release schedules and seasonality, full fiscal year operating performance has been relatively stable. For the 12 months ended Dec. 31, 2003, the EBIT and the estimated EBITDA margins were 10% and 11%, respectively. The comparative ratio for the fiscal year ended March 31, 2003, were 11% and 12.4%, respectively. Activision does not have any debt in its capital structure. Activision has primarily been funded through equity and, in the last three years, discretionary cash flow. Inconsistent discretionary cash flow trends reflect the long development and investment period in advance of a game's release, and a very short period in which a return on investment is realized. AIR CANADA: Longacre Funds Offer 20% for CCAA Claims ---------------------------------------------------- The Longacre Funds are offering to purchase CCAA claims against Air Canada at a rate of 20 cents-on-the-dollar. All transactions "would be structured as a simple assignment of claim," Longacre says. "Longacre would assume all credit risk, on a non-recourse basis, regarding amount and timing of any distributions," Longacre adds. For additional information, contact Marc Wingate at (212) 259- 4315. AIR CANADA: Lauds Alberta's Move to Eliminate Aviation Fuel Tax --------------------------------------------------------------- Air Canada welcomed an announcement by the Alberta government eliminating the aviation fuel tax for international flights, and encouraged all governments and authorities to follow in Alberta's steps in the reduction of taxes and fees imposed on the aviation industry. "We applaud the Alberta government for their action in eliminating the aviation fuel tax on international air services. Their initiative is a welcome break from the current trend of rising fees and surcharges imposed by governments and government-created monopolies," said Robert Milton, President and Chief Executive Officer. "The resulting positive impact on operating costs will be factored in our evaluation of air services in Alberta as we move forward with our new business strategy. We encourage the Alberta government to take the added step of completely eliminating the fuel taxes on domestic flights. Following the example set by Alberta, we urge all governments and authorities to work with the industry as partners in the development of sustainable air services." Air Canada operates 62 weekly flights from Alberta to destinations in the US, Caribbean and Europe, and together with its subsidiaries Air Canada Jazz and ZIP, 100 daily flights to destinations across Canada. ZIP is headquartered in Calgary, and by the end of 2004, will expand to operate a fleet of 20 state-of- the-art Airbus 319 aircraft. AK STEEL: Signs Sale Agreement for Greens Port Industrial Park -------------------------------------------------------------- AK Steel Corporation (NYSE: AKS) announced it has signed an agreement for the sale of a 600-acre industrial park in Texas to Greensport Management LLC of Houston, Texas. The industrial park is situated adjacent to the Houston Ship Channel, one of the busiest foreign cargo ports in the United States. Terms of the sale were not disclosed, and the sale is subject to completion of due diligence and customary closing conditions. AK Steel said it expects to complete the sale by March 31, 2004. AK Steel announced in October of 2003 its intention to sell the industrial park, located in Harris County, and to use the proceeds primarily to reduce its debt. Headquartered in Middletown, AK Steel produces flat-rolled carbon, stainless and electrical steel products for automotive, appliance, construction and manufacturing markets, as well as tubular steel products. In addition, the company produces snow and ice control products. As of December 31, 2003 AK Steel records a total shareholders' equity deficit of $52.8 million. ALLEGIANCE TELECOM: XO Communications Wins Bid to Acquire Assets ---------------------------------------------------------------- XO Communications, Inc. (OTCBB:XOCM.OB), one of the nation's leading providers of broadband telecommunications services, announced that it has been selected as the winning bidder for substantially all of the assets of Allegiance Telecom, Inc. (OTCBB:ALGXQ.OB) and its subsidiaries except for Allegiance's customer premise equipment sales and maintenance business, its managed modem business and certain other Allegiance assets and operations. Under the terms of the transaction, XO will purchase substantially all of Allegiance's assets for approximately $311 million in cash and approximately 45.38 million shares of XO common stock. The parties expect to finalize the definitive agreement within the next several days and submit for approval by the U.S. Bankruptcy Court for the Southern District of New York for approval on February 19, 2004. The transaction is also subject to applicable governmental approvals and termination of applicable waiting periods. With the acquisition of substantially all of Allegiance's network assets and customer base, XO will become the nation's largest independent provider of national local telecommunications and broadband services with approximately 330,000 customers and more than $1.6 billion in revenue. The company will have the largest network of nationwide connections to regional Bell operating companies' networks of any other CLEC, and double the Points of Presence (PoPs) within the 36 markets where both XO and Allegiance operate XO believes that this extensive network will help XO improve delivery of service to customers, reduce network costs, improve operating results and better compete head to head with other companies in the nationwide local telecommunications services market. "The acquisition of Allegiance Telecom's network assets will make XO the nation's largest national local telecommunications services provider," said Carl Grivner, chief executive officer of XO Communications. "The combination of XO and Allegiance is good for both the industry and businesses. It will contribute to increased competition for regional Bell operating companies and give businesses more choices for their end-to-end telecommunications needs. In addition, the acquisition increases the density of our PoPs (Points of Presence) in local markets, which uniquely positions XO to sell last mile and metro services to all the large long distance companies." "We have identified approximately $60 million in network cost savings and $100 million in general and administrative costs that could be realized over time as a result of this acquisition," added Grivner. "The telecommunications industry is ripe for consolidation, and this acquisition strengthens XO's platform for the future acquisition of undervalued assets in the industry," said Carl Icahn, chairman of XO Communications. About Allegiance Telecom Allegiance Telecom (Bankr. S.D.N.Y. Case No. 03-13057) is a facilities-based national local exchange carrier headquartered in Dallas, Texas. As the leader in competitive local service for medium and small businesses, Allegiance offers "One source for business telecomT" - a complete package of telecommunications services, including local, long distance, international calling, high-speed data transmission and Internet services and a full suite of customer premise communications equipment and service offerings. Allegiance serves 36 major metropolitan areas in the U.S. with its single source provider approach. Allegiance's common stock is traded on the Over the Counter Bulletin Board under the symbol ALGXQ.OB. About XO Communications XO Communications is a leading broadband telecommunications services provider offering a complete set of telecommunications services, including: local and long distance voice, Internet access, Virtual Private Networking (VPN), Ethernet, Wavelength, Web Hosting and Integrated voice and data services. XO has assembled an unrivaled set of facilities-based broadband networks and Tier One Internet peering relationships in the United States. XO currently offers facilities-based broadband telecommunications services within and between more than 70 markets throughout the United States. AMERICAN HOMEPATIENT: Mellon Entities Disclose 6.46% Equity Stake ----------------------------------------------------------------- Mellon Financial Corporation and Mellon HBV Alternative Strategies LLC, beneficially own 1,056,746 shares of the common stock of American HomePatient, Inc., with sole voting and dispositive powers. The amount held represents 6.46% of the outstanding common stock of the Company. American HomePatient, Inc. -- whose September 30, 2003 balance sheet shows a total shareholders' equity deficit of about $38 million -- is one of the nation's largest home health care providers with 288 centers in 35 states. Its product and service offerings include respiratory services, infusion therapy, parenteral and enteral nutrition, and medical equipment for patients in their home. American HomePatient, Inc.'s common stock is currently traded in the over-the-counter market or, on application by broker-dealers, in the NASD's Electronic Bulletin Board under the symbol AHOM.OB. AMES DEPT: Seeks Court Nod for Aug. 27 Plan-Filing Exclusivity -------------------------------------------------------------- Ames Department Stores, Inc., and its debtor-affiliates ask the Court to extend their exclusive period to file a plan through August 27, 2004 and their exclusive period to solicit acceptances of that plan through October 26, 2004. Martin J. Bienenstock, Esq., at Weil, Gotshal & Manges LLP, in New York, tells the Court that ever since the Debtors decided to wind down their business, they have been diligently laboring to maximize values for their creditors. Specifically, throughout their Chapter 11 cases, the Debtors made considerable progress towards developing a plan by, inter alia: (a) filing their schedules of assets and liabilities, schedules of executory contracts and unexpired leases, and statements of financial affairs; (b) selling all their inventory; (c) fully satisfying their obligations under their postpetition financing facilities; (d) analyzing the Debtors' store locations and leased portfolio and disposing of leased and fee-owned properties; (e) rejecting or assuming and assigning the majority of their unexpired non-residential real property leases in accordance with Section 365 of the Bankruptcy Code; (f) settling and reconciling creditors' claims; (g) analyzing and prosecuting Preference Actions to increase the value of the Debtors' estates; and (h) implementing the Claims Settlement Program, which reduced the amount of administrative expense claims against the Debtors' estates and increased the likelihood the Debtors will achieve administrative solvency. At this point, however, it is not possible for the Debtors to determine the full extent of their administrative obligations and the resources available to satisfy these obligations. It follows, therefore, that the Debtors are not in a position to determine if a recovery will be available for prepetition creditors. The Debtors still need to complete the process of liquidating their real property interests, reconciling administrative expense claims, and prosecuting avoidance actions. The Debtors are working in tandem with the statutory creditors committee to accurately assess their postpetition assets and liabilities. Mr. Bienenstock notes that this is a cooperative case with the Committee. Simply to avoid the possibility of an errant plan being filed that will consume much time and expense before the possibility of a confirmation is known, the Debtors determined that a six-month extension of their Exclusive Periods is necessary. The Debtors believe that an extension will avoid motion practice and unnecessary intrusion on their management's time. Mr. Bienenstock explains that while the Debtors have successfully disposed of majority of their real property, a number of their major real estate assets have not yet been liquidated, including a distribution center and a home office building they own. Moreover, although an exact number is not available at this time, after taking into account the administrative expense claims settled under the Claims Settlement Program, the Debtors anticipate that they will have $100,000,000 in administrative expense claims, many of which still need to be reconciled. In addition to liquidating their remaining real estate interests and reconciling claims, the Debtors also need time to prosecute the Preference Actions. The Debtors have commenced 2,000 Preference Actions to date. Prosecution of these Preference Actions will take several months to complete. The Debtors maintain that the successful prosecution of the Preference Actions is critical to a determination of the ultimate recovery available to prepetition and postpetition creditors in their Chapter 11 cases. According to Mr. Bienenstock, given the scope of the Debtors' cases, litigation with third parties is minimal. Thus, although the Debtors are winding down their business, the Chapter 11 process has been exceedingly orderly and constructive. The vital components underlying a plan are being developed as rapidly as possible. Responding to a competing plan while simultaneously engaging in the orderly realization from their assets would seriously undermine the Debtors' attempt to maximize recoveries for creditors. In short, failure to extend the Exclusive Periods could subvert the Debtors' overall progress to date. Mr. Bienenstock points out that no other party currently has a plan to propose, and no one will be precluded from asking the Court's permission to propose a plan if exclusivity is extended. The extension only causes a putative plan proponent to ask permission before filing a plan. This way, irresponsible or destructive plans and their concomitant effects on recoveries can be avoided. The Debtors contend that by any reasonable measure, their Chapter 11 cases are sufficiently large and complex to warrant an extension of the Exclusive Periods. The Debtors' cases, with thousands of creditors and an estimated $1,500,000,000 in assets and liabilities, is among the larger and more complex Chapter 11 cases by nationwide standards. Mr. Bienenstock adds that before they decided to liquidate their assets, the Debtors' primary focus was the stabilization of their operations. Despite the various crises and operational problems that accompany the commencement of large and complex Chapter 11 cases, the Debtors were able to stabilize their operations, solidify relationships with vendors, customers, and critical employees, and return to the foremost task of effectively managing their business operations during the first 12 months of their bankruptcy. Accordingly, an extension of the Exclusive Periods will not prejudice any party-in-interest but will further enhance the value of the Debtors' estates. Terminating the Exclusive Periods at this time, with the threat of multiple plans, would likely lead to unnecessary adversarial situations and confrontations that will cause a deterioration in the value of the Debtors' remaining assets. Headquartered in Rocky Hill, Connecticut, Ames Department Stores, Inc., is a regional discount retailer that, through its subsidiaries, currently operates 452 stores in nineteen states and the District of Columbia. The Company filed for chapter 11 protection on August 20, 2001 (Bankr. S.D.N.Y. Case No. 01-42217). Albert Togut, Esq., Frank A. Oswald, Esq. at Togut, Segal & Segal LLP and Martin J. Bienenstock, Esq., and Warren T. Buhle, Esq., at Weil, Gotshal & Manges LLP represent the Debtors in their restructuring efforts. When the Company filed for protection from their creditors, they listed $1,901,573,000 in assets and $1,558,410,000 in liabilities. (AMES Bankruptcy News, Issue No. 50; Bankruptcy Creditors' Service, Inc., 215/945-7000) ASSET SECURITIZATION: S&P Takes Rating Actions on 1996-D2 Notes --------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on four classes of Asset Securitization Corp.'s series 1996-D2, three of which (A-3, A-4, B-1A) are concurrently removed from CreditWatch with negative implications, where they were placed on Nov. 3, 2003. Additionally, the rating on class A-1 is affirmed. The lowered ratings are due to interest shortfalls, or, in the case of the class A-2, susceptibility to interest shortfalls, coupled with anticipated credit support erosion associated with the specially serviced assets. The downgrades to classes A-3, A-4, and B-1A reflect cumulative interest shortfalls on the January 2004 remittance. The interest shortfalls are primarily the result of monthly appraisal subordinated entitlement reduction amounts (ASERs), reported at $519,000 on the January remittance. Other major factors include a mechanism in the transaction that prevents advancing for the benefit of subordinate bondholders for loans that are delinquent more than 30 days, reflected as a $225,000 shortfall for the January payment. Should the current high dollar volume of specially serviced assets not be resolved as expected, the classes will continue to short and/or be susceptible to interest shortfalls, warranting further rating actions. The affirmed rating on class A-1 reflects stressed credit enhancement levels that adequately support a 'AAA' rating, and the presumption that liquidity concerns in the trust will begin to improve upon the disposition/correction of some of the specially serviced assets over the next several distribution periods. As of the January 2004 remittance, 12 assets (19% of the pool) are delinquent, which is significantly higher than Standard & Poor's 1996 average conduit delinquency rate (7.4%). Nine of the assets, (14.6% of the pool) are 90-plus days delinquent, in foreclosure, or REO. To date, the certificates have been written down by more than $28 million in principal losses. Over the course of the transaction's life, the ratings on four classes have been set to 'D' due to interest shortfalls, two of which subsequently incurred principal losses. All of the delinquent loans are specially serviced. There were 17 loans in specially servicing with an aggregate outstanding balance of $164.7 as of the January remittance date. Of these, six loans, with a balance of $82.4 million, are secured by healthcare properties and specially serviced by GMAC Commercial Mortgage Corp. (GMACCM), while 11 loans, with an aggregate balance of $82.2 million, are secured by non-healthcare properties specially serviced by CRIIMI MAE Services L.P. The healthcare assets have appraisal reduction amounts (ARAs) of $25.1 million, which resulted in $263,158 of ASERs for the January 2004 remittance date. Three loans, totaling $52.6 million, are 90- plus days delinquent. One of the 90-plus delinquent loans is the third-largest loan in the pool, with an aggregate outstanding balance of $29.9 million. The loan, which is secured by two healthcare facilities in New Jersey, has not made full debt service payments since July 2003. The default occurred because the borrower over billed Medicare, and has been in the process of repaying the government. The borrower should be able to resume timely debt service payments in February or March, at which time there will be a significant amount of advances outstanding on the loan, which currently total $1.6 million. Should the borrower be unable to repay the advances in a timely fashion, it could present additional liquidity issues for the trust. Of the remaining loans, two totaling $25.4 are current and should eventually be returned to the master servicer. Another loan, totaling $4.5 million, is 60 days delinquent. GMACCM is working with the borrower to return it to current status. The non-healthcare specially serviced assets contributed to $255,881 of ASER interest shortfalls as of the most recent remittance. The related ARAs total $24.9 million. In addition to the ASERs, future advances on one REO, the Ramada Inn Mobile, were declared non-recoverable, contributing to $71,000 of interest shortfalls on the January remittance. The asset was recently liquidated at or near a 100% principal loss (approximately $6 million), and will not contribute to interest shortfalls going forward. The remaining specially serviced assets are all secured by lodging assets. Three loans, totaling $14.8 million, are current and will be returned to the master servicer. The remaining five are 90-plus days delinquent or REO and are more problematic. Standard & Poor's expects significant losses upon disposition of most of these assets. One REO, Westar, has a current outstanding balance of $16.5 million. The related loan was originally secured by five Homegate properties, three of which have been sold. Upon liquidation of the remaining loans, the realization of a 100% principal loss is anticipated. The loan has an ARA outstanding of $15.4 million. Transaction liquidity should improve upon final liquidation as the ARA generates an ASER of $158,000 each month. The pool consists of 107 loans with an outstanding principal balance of $659.5 million, down from 124 loans with a balance of $879.5 million at issuance. Net cashflow financial data at December 2002 was provided for 92.4% of the pool. The majority of information was for year-end 2002, although more recent information was provided for 6% of the pool. Based on this data, Standard & Poor's calculated the weighted average debt service coverage for the outstanding loans at 1.27x, down from 1.62x at issuance. The current figure excludes defeased collateral, which makes up 7.7% of the pool. Standard & Poor's revised and affirmed its ratings to reflect current and projected interest shortfalls and its loss analysis, which focused primarily on the specially serviced and other underperforming assets in the pool. RATINGS LOWERED Asset Securitization Corp. Commercial mortgage pass-through certs series 1996-D2 Rating Class To From Credit Support A-2 A AA+ 26.4% RATINGS LOWERED; REMOVED FROM CREDITWATCH Asset Securitization Corp. Commercial mortgage pass-through certs series 1996-D2 Rating Class To From Credit Support A-3 BB+ A-/Watch Neg 18.4% A-4 CCC BB/Watch Neg 13.0% B-1A D B/Watch Neg 4.2% RATING AFFIRMED Asset Securitization Corp. Commercial mortgage pass-through certs series 1996-D2 Class Rating Credit Support A-1 AAA 34.4% AVADO BRANDS: Asks Court to File Schedules Up Until April 4 ----------------------------------------------------------- Avado Brands, Inc., together with its debtor-affiliates, is asking for an extension of time from the U.S. Bankruptcy Court for the Northern District of Texas, Dallas Division, to file their schedules of assets and liabilities, statements of financial affairs and lists of executory contracts and unexpired leases required under 11 U.S.C. Sec. 521(1). The Debtors seek to file their Schedules of Assets and Liabilities and Statement of Financial Affairs up until April 4, 2004. The Debtors have approximately 40,000 creditors and parties-in- interest and operate their business from various locations. Given the size and complexity of their business and the fact that certain prepetition invoices have not yet been received or entered into the Debtors' financial systems, the Debtors have not had the opportunity to gather the necessary information to prepare and file their respective Schedules and Statements. While the Debtors have commenced the task of gathering the necessary information to prepare and finalize what will be voluminous Schedules and Statements. The Debtors believe that the sought extension will afford them sufficient time to complete their Schedules and Statements. Headquartered in Madison, Georgia, Avado Brands, Inc. -- http://www.avado.com/-- is a restaurant brand group that grows innovative consumer-oriented dining concepts into national and international brands. The Company filed for chapter 11 protection on February 4, 2004 (Bankr. N.D. Tex. Case No. 04-31555). Deborah D. Williamson, Esq., and Thomas Rice, Esq., at Cox & Smith Incorporated represent the Debtors in their restructuring efforts. When the Company filed for protection from its creditors, it listed $228,032,000 in total assets and $263,497,000 in total debts. BLOUNT INTL: Will Webcast Q4 2003 Conference Call on February 20 ---------------------------------------------------------------- Blount International, Inc. (NYSE: BLT) announces the following webcast: What: Blount's Q4 2003 Financial Release Conference Call Webcast When: 02/20/04 @ 1:00 p.m. Eastern Where: http://www.firstcallevents.com/service/ajwz399156931gf12.html How: Live over the Internet -- Simply log on to the web at the address above. Contact: Calvin Jenness Sr. Vice President & Chief Financial Officer 503-653-4573 cej@blount.com Fax: 503-653-4612 Blount International, Inc. is a diversified international company operating in three principal business segments: Outdoor Products, Lawnmower and Industrial and Power Equipment. Blount International, Inc. sells its products in more than 100 countries around the world. For more information about Blount International, Inc., visit its website at http://www.blount.com/. At September 30, 2003, Blount's balance sheet shows a total shareholders' equity deficit of about $405 million. BOISE CASCADE: Declares Dividends & Sets Annual Meeting in April ---------------------------------------------------------------- Boise Cascade Corporation (NYSE: BCC) announced a regular quarterly dividend of 15 cents per common share, payable on April 15, 2004, to shareholders of record on April 1, 2004. In addition, a regular semiannual dividend of $1.659375 on the company's convertible preferred stock, Series D, was declared. The dividend is payable on June 28, 2004, to shareholders of record on June 14, 2004. Boise's annual meeting of shareholders will be held at 12 noon (Mountain daylight time) on April 15, 2004, in Boise, Idaho. The record date to determine shareholders eligible to vote at the meeting is February 23, 2004. Boise (S&P, BB+ Corporate Credit Rating, Stable Outlook), headquartered in Boise, Idaho, provides solutions to help customers work more efficiently, build more effectively, and create new ways to meet business challenges. Boise is a major distributor of office products and building materials and an integrated manufacturer and distributor of paper, packaging, and wood products. Boise owns or controls more than 2 million acres of timberland, primarily in the United States, to support our manufacturing operations. Visit the Boise Web site at http://www.bc.com/ BRIAZZ INC: Wells Fargo Reports 8.2% Equity Stake ------------------------------------------------- Wells Fargo & Company beneficially owns 492,961 shares of the common stock of Briazz, Inc., representing 8.2% of the outstanding common stock of Briazz. Wells Fargo holds shared dispositive power, and no voting power over the stock. Briazz is dedicated to feeding the teeming white-collar masses. The company operates about 45 cafes in Chicago, Los Angeles, San Francisco, and Seattle offering on-the-go office workers a variety of breakfast and lunch items. Its menu features sandwiches, soups, and salads, as well as bagels, fruit, and coffee. The company also offers box lunch delivery and catering services. Briazz contracts with third parties, including in-flight catering company Flying Food Group, to supply its menu items. Chairman Victor Alhadeff, who opened the first Briazz cafe in Seattle in 1995, owns about 20% of the company * * * As previously reported, Briazz, Inc. dismissed PricewaterhouseCoopers LLP as the independent accountants for the Company, advising PwC that the Audit Committee of the Company's Board of Directors approved the selection of Grant Thornton LLC as the independent accountants of the Company on December 17, 2003. The reports of PwC on the Company's financial statements for the years ended December 29, 2002, and December 30, 2001 contained a report issued by PwC which included an explanatory paragraph containing a reference to the substantial doubt that existed regarding the Company's ability to continue as a going concern. BUDGET GROUP: Airs Objections to Various Creditor Claims -------------------------------------------------------- The Budget Group Debtors ask the Court to disallow and expunge 106 Claims aggregating $53,929,067, which were filed after the Bar Date. The Late-Filed Claims include: Claimant Claim No. Claim Amount -------- --------- ------------ Eliazer, Garcia 4711 $2,000,000 Mendez, Jose 4723 10,500,000 New York City 4851 161,548 Ortiz, Noel 4720 10,000,000 Phillips, Carolyn 4828 300,000 Puerto Rico Ports Authority 4818 3,322,503 Smith, Raymond 4901 100,000 St. John, Natalie 4694 1,000,000 Torres, Margarita 4721 10,000,000 Walls, Pamela 5089 1,010,000 Pursuant to the Bar Date Order, all holders of claims and interests were required to file a proof of claim with supporting documentation on or before April 30, 2003. Robert S. Brady, Esq., at Young Conaway Stargatt & Taylor LLP, in Wilmington, Delaware, asserts that failure to disallow the Late- Filed Claims will result in the applicable claimants receiving an unwarranted recovery against the Debtors' estates, to the detriment of other unsecured creditors in these cases. Incorrect Debtor Claims Mr. Brady further informs the Court that 609 claims aggregating $108,852,786 do not comport with the obligation owed by the applicable Debtor as set forth in the Debtors' Schedules filed with the Court on September 27, 2002. The Debtors believe that these claims were mistakenly filed against the incorrect Debtor estate due to the large number of Debtor entities and confusion over which Debtor estate was responsible for the asserted obligation. After a review of their Schedules, the Debtors have determined the proper Debtor entity against which each of the Disputed Claims should have been asserted. These claims include: Modified Claimant Claim No. Case No. Claim Amount -------- --------- -------- ------------ Anderson Motors Inc. 3822 02-12162 $371,291 Bernstein & Bernstein 3457 02-12167 1,700,000 Brown, George 89 02-12152 100,000,000 Denver City 215 02-12152 1,480,149 Hudson United Bank 1005 02-12152 321,694 IBM Credit Corporation 435 02-12152 404,880 Lopez, Ronny 2968 02-12166 200,000 PricewaterhouseCoopers, LLP 155 02-12152 468,988 United California Factors 1196 02-12152 178,482 Washington, Lance 3862 02-12167 1,000,000 Failure to reclassify the Disputed Claims could result in the claimant receiving multiple distributions, or in the event that substantive consolidation is not granted in a timely fashion, result in the claimant receiving a distribution from the incorrect Debtor estate, Mr. Brady says. Accordingly, the Debtors object to the Incorrect Debtor Claims and ask the Court to reclassify each of them accordingly. Non-Supported Claims Pursuant to the Bar Date Order, all holders of claims and interests were required to file a proof of claim with all supporting documentation on or before the Bar Date. Mr. Brady reports that 505 Claims aggregating $1,267,880,950 were filed without any supporting documentation. As a result, the Debtors ask the Court to expunge and disallow the Non-Supported Claims, which includes: Claimant Claim No. Claim Amount -------- --------- ------------ Dibono, Danielle 2510 $10,000,000 Diesel Injection of Cary 1769 1,020,000 Dragonetti, Douglas, Jr. 1296 3,000,000 Farhadue Siddique 1876 5,000,000 Fray, Donald Royston 1768 1,020,000 Glaspie, Raquel 4354 2,000,000 Glogoff, Sally 2514 1,000,000 Yulfo, David 1753 1,000,000 Zheng, Mei Guan 1680 1,000,000 Zillas, Arthur S. 4357 2,000,000 Headquartered in Daytona Beach, Florida, Budget Group, Inc., operates under the Budget Rent a Car and Ryder names -- is the world's third largest car and truck rental company. The Company filed for chapter 11 protection on July 29, 2002 (Bankr. Del. Case No. 02-12152). Lawrence J. Nyhan, Esq., and James F. Conlan, Esq., at Sidley Austin Brown & Wood and Robert S. Brady, Esq., and Edward J. Kosmowski, Esq., at Young, Conaway, Stargatt & Taylor, LLP, represent the Debtors in their restructuring efforts. When the Company filed for protection from their creditors, they listed $4,047,207,133 in assets and $4,333,611,997 in liabilities. (Budget Group Bankruptcy News, Issue No. 34; Bankruptcy Creditors' Service, Inc., 215/945-7000) BUILDERS FIRSTSOURCE: S&P Cuts Rating over Plan to Increase Debt ---------------------------------------------------------------- Standard & Poor's Ratings Services lowered its corporate credit rating on Dallas, Texas-based building products distributor and manufacturer Builders FirstSource Inc. to 'B+/Stable/--' from 'BB- /Stable/--', and its senior secured bank loan rating to 'B+' from 'BB-' following news that the company plans to increase debt significantly in connection with a recapitalization transaction. The additional debt leverage increases the company's vulnerability to economic cycles. In addition, Standard & Poor's views the transaction as a shift to a more aggressive financial policy than was previously expected. "For confidentiality reasons, BFS has requested and Standard & Poor's has agreed to withdraw its public ratings on the company shortly," said Standard & Poor's credit analyst Dominick D'Ascoli. The ratings on BFS Inc. reflect the cyclicality of new residential construction, volatile lumber and other material costs, narrow product and geographic diversity, and a very aggressive financial profile. These negatives overshadow a good market position with key homebuilding customers, favorable end market conditions, and improved operating efficiencies. BFS is a leading distributor of lumber and millwork to professional homebuilders and contractors for the new home construction industry. The privately held company operates 62 distribution and 40 manufacturing facilities in 11 states. In addition, the company manufactures certain products internally. Primary products and services provided to builders include trusses, wall panels, custom millwork, pre-hung doors and windows, product installations, customized billing, and project management. BUTLER MFG: Continues To Work With Lenders To Cure Debt Defaults ---------------------------------------------------------------- Butler Manufacturing Company (NYSE:BBR) reported substantially improved results in sales and operating earnings in the fourth quarter ended December 31, 2003. Butler's fourth quarter sales were $232 million compared with $193 million a year ago, an increase of approximately 20%. Stronger results in China and the North American Building Systems businesses led the growth in sales. Pretax income was $2.2 million in the fourth quarter of 2003 compared with a pretax loss of $0.6 million in the fourth quarter of 2002. The fourth-quarter net loss was $19.1 million, or $3.01 per share, and includes a $24.7 million, or $3.89 per share, non-cash income tax valuation allowance expense within income tax expense, compared with net income of $1.5 million, or $0.24 per share in the prior year. The income tax valuation allowance expense is related to the establishment of a valuation allowance as a result of uncertainty as to the realization of deferred tax assets of the company, required under generally accepted accounting principles. Butler has not extended its senior debt agreements and remains in default of certain covenants under those debt agreements. As a result, they expect their auditors will include a going concern qualification in their audit opinion of the 2003 financial statements upon completion of the audit. The company continues to work with their lenders and announced on December 30, 2003 an agreement with their senior note holders deferring principal payments. In exchange, Butler agreed to satisfy certain milestones including the consummation of a transaction that provides for repayment in full of the outstanding senior notes by April 30, 2004. The lenders have not waived any rights and are free to require payment of $90 million of debt recorded on the company's balance sheet as well as require funding of approximately $23 million of stand-by letters of credit. For 2003, annual sales were $796 million compared with $828 million a year ago, or 4% lower. The net loss was $32.1 million, including the $24.7 million non-cash income tax valuation allowance expense, compared with the net loss of $1.8 million in 2002. Commenting on the results, John Holland, chairman and chief executive officer, said, "In 2003, the domestic construction markets recorded the fourth consecutive annual decline, as F. W. Dodge reported a 3% decline in nonresidential construction orders, with the commercial segment off 6% and the manufacturing segment up 8%, a positive development, albeit increasing from a very low base. We have had an extremely challenging year but nonetheless have taken actions to reduce costs and invest in new products and markets during this very tough period. With the economy showing signs of improvement coupled with the aggressive cost reductions and new products and capabilities developed during 2003, we believe the company is on a path toward profitability in 2004. "We view the deferral agreement with our senior note holders as a positive step in the right direction of pursuing the previously announced strategic options initiative. We have made substantial progress in pursuing the strategic initiatives and our business is beginning to show signs of improvement as well, recording an operating profit in the fourth quarter of 2003. While we cannot guarantee that we will conclude a transaction by the April 30, 2004 deadline it remains our highest priority to do so. "We ended 2003 with a backlog of $319 million, 21% higher compared with the backlog at the end of 2002. Each of our businesses posted higher backlogs except the Vistawall Architectural Products Group where the backlog was down a slight 1%. Our higher margin product backlog was up 17% and the construction backlog was 33% higher than at the end of 2002. "Sales in the North American Building Systems segment were $375 million in 2003, 5% lower when compared with the prior year. The pretax loss was approximately $19.8 million, compared with a pretax loss of $7.6 million in 2002. The 2003 loss includes a $4.8 million asset impairment expense related to the Lester wood building business. We believe that 2003 was the bottom of the cycle as this segment posted stronger sales in the fourth quarter 2003 compared with 2002 and a stronger backlog as we enter 2004. "Actions taken in the North American Building Systems segment in 2003 to lower costs and add new capabilities are expected to benefit 2004. Several major initiatives that added expense in 2003 will benefit 2004. Our new R-SteelT panel system plant opened late last year and the product has been well received in the market. Our Mexican pre-engineered metal building plant opened on schedule in December 2003. This lower cost facility will enhance our competitive position in Latin America and domestically. Finally, the major enterprise resource planning system implemented in May 2003, has begun to deliver benefits and will position our pre- engineered metal buildings business to operate more effectively as we master its capabilities to better serve customers. "The International Building Systems sales were $138 million compared with $108 million in 2002. The 2002 sales included $10 million from our European operation prior to its divestiture in July of that year. The market in China remains robust and we have done an excellent job of expanding our brand and market position as the leading pre-engineered metal building supplier in China. In addition, we opened a manufacturing facility in China in the latter half of 2003 to support our Vistawall product line. The seamless introduction of the Vistawall product line will leverage our market leading position to add a new growth opportunity for Butler in China. Pretax income for this segment increased to $11.3 million compared with approximately $8 million in 2002, a 41% increase. The economy in China remains strong and Butler is well positioned to continue to capitalize on this growth opportunity. "The Vistawall Architectural Products Group sales were $217 million for all of 2003 compared with $220 million in 2002. The 1% decline in sales was much better than the overall 6% drop in commercial construction awards. Pretax earnings were $11.2 million compared with $8.9 million in 2002. This outstanding performance in 2003 was against challenging market conditions as we outperformed the domestic market and supported the start-up in China and the United Arab Emirates. Vistawall is poised for growth offering customers a single source array of architectural products to further consolidate the construction supply chain. "Butler Construction sales were approximately $81 million in 2003 compared with $111 million last year, a 28% decrease. The entire decline in sales occurred in the first half of 2003, reflecting the uncertain economy. The pretax loss was $3.4 million compared with pretax earnings of $2.0 million in 2002. The 2003 loss includes a $2.4 million asset impairment charge related to the planned closure of leased office space. We reduced expenses in this business but were unable to offset the decline in volume experienced in the first half of 2003. Construction backlog is up 33% and we expect a strong first half of 2004. As previously announced, we are in the process of combining the Construction business with our North American Buildings business, forming the Buildings Group. This combination improves the alignment, capabilities and talents of our associates in these two operations to better serve customers and enhance our ability to consolidate the construction supply chain. The Real Estate segment sales of completed projects were approximately $5 million for the year compared with about $16 million last year, with the drop in sales related to fewer opportunities in this business throughout 2003. With the lower sales volume and a smaller rent-flowing development portfolio, pretax earnings were $0.2 million compared with $3.3 million a year ago. "We believe the domestic nonresidential construction market is in the early stages of improvement after three difficult and challenging years. Our China business continues to provide significant growth potential and Vistawall is well positioned to continue its successful track record. The general US economy continues to show signs of a turnaround with the price of many commodities increasing significantly. Steel and aluminum costs are increasing, posing a challenge to improve operating margins. However, we are taking aggressive action to manage our pricing to capture these higher costs. "We have introduced a great deal of change over the past couple of years, dramatically restructuring costs and operations and have invested prudently in new products and capabilities that will expand future market opportunities for the company. We will endeavor to work through the challenges posed by our financial situation and are doing so as we pursue our strategic options. We remain totally committed to delivering value to our owners, associates and the customers whom we serve," Mr. Holland concluded. Butler Manufacturing Company is the world's leading producer of pre-engineered building systems, a leading supplier of architectural aluminum systems and components, and provides construction and real estate services for the nonresidential construction market. An analyst conference call to review the fourth-quarter and year- end results will be held Tuesday, February 17th at 9:00 AM EST. A live audio webcast of the call will be available to the public on a listen-only basis. To listen to the webcast go to www.butlermfg.com and click on the webcast icon. An audiotape playback of the conference call will begin at 11:30 AM EST Tuesday February 17th and run through March 1st. To access the playback dial toll free 800-428-6051, or 973-709-2089, and enter reservation #336999. CENTERPOINT ENERGY: Unit Issues Two Series Of Refunding Bonds ------------------------------------------------------------- CenterPoint Energy, Inc. (NYSE: CNP) announced the issuance of two series of collateralized revenue refunding bonds by two governmental authorities on behalf of CenterPoint Energy Houston Electric, LLC, CenterPoint Energy's electric transmission and distribution subsidiary. The first series of refunding bonds, with an aggregate principal amount of approximately $56.1 million, bears a long-term interest rate of 5.6 percent and was issued on Feb. 6, 2004. The second series of refunding bonds, with an aggregate principal amount of $43.8 million, bears a long-term interest rate of 4.25 percent and was issued on Feb. 11, 2004. CenterPoint Energy Houston Electric, LLC's installment payment obligations for each series of refunding bonds are collateralized by separate series of its general mortgage bonds. Payment of the principal at maturity and interest when due on the second series of refunding bonds is guaranteed by a municipal bond insurance policy issued by Financial Guaranty Insurance Company. The proceeds of the refunding bonds will be used to redeem two series of currently outstanding collateralized revenue refunding bonds previously issued by the same governmental authorities on behalf of CenterPoint Energy Houston Electric, LLC's predecessor, Houston Lighting & Power Company. The bonds to be redeemed have an aggregate principal amount of approximately $99.9 million, bear a long-term interest rate of 6.70 percent and were originally issued in April 1992. CenterPoint Energy's installment payment obligations for each series of the bonds to be redeemed are collateralized by separate series of CenterPoint Energy Houston Electric, LLC's first mortgage bonds. The offering of the refunding bonds is not required to be registered under the Securities Act of 1933. CenterPoint Energy, Inc. (Fitch, BB+ Preferred Securities and Zero-Premium Exchange Notes' Ratings, Negative), headquartered in Houston, Texas, is a domestic energy delivery company that includes electric transmission and distribution, natural gas distribution and sales, interstate pipeline and gathering operations, and more than 14,000 megawatts of power generation in Texas. The company serves nearly five million customers primarily in Arkansas, Louisiana, Minnesota, Mississippi, Missouri, Oklahoma, and Texas. Assets total approximately $20 billion. CenterPoint Energy became the new holding company for the regulated operations of the former Reliant Energy, Incorporated in August 2002. With more than 11,000 employees, CenterPoint Energy and its predecessor companies have been in business for more than 130 years. For more information, visit the Web site at http://www.CenterPointEnergy.com/ CKE RSTAURANTS: Reports Preliminary Fourth Quarter Charges ---------------------------------------------------------- CKE Restaurants, Inc. (NYSE: CKR)announced certain decisions it has made in the fourth quarter of fiscal 2004, ended January 26, 2004, to improve the Company's overall operating performance. Such decisions include the plan to close 28 Hardee's restaurants and a third-party valuation of the La Salsa brand, both of which will result in non-cash charges in the fourth quarter. A summary of preliminary fourth quarter charges follows: -- A non-cash goodwill impairment charge between $30 and $34 million to reflect the current carrying value of the La Salsa brand -- Total facility action charges for the fourth quarter between $14 and $16 million -- approximately $10 million of which are non-cash items -- as detailed below: * A non-cash asset impairment charge between $5 and $6 million related to the anticipated closure of 28 Hardee's restaurants * Approximately $4 million of non-cash asset impairment charges to reduce the carrying value of certain restaurants the company continues to operate * Approximately $2 million in lease reserves related to five facilities subleased to a Hardee's franchisee currently in bankruptcy proceedings (as previously disclosed in the Company's third quarter Form 10-Q) * Approximately $2 million in additional lease reserves to reflect the current level of subsidies CKE provides on sub-leases to franchisees * Between $1 and $1.5 million in charges for other facility actions Andrew F. Puzder, president and chief executive officer, said, "While no one likes to take charges, we believe these actions are in the best interest of our company and our shareholders. We remain very confident in our overall operating model and our core business performance. We look forward to reporting final results for the fourth quarter and fiscal year in late March." Charges Related to Closure of 28 Hardee's Restaurants Puzder continued, "The closure of 28 Hardee's restaurants is another step in our ongoing efforts to improve Hardee's operations and we anticipate our actions will have a positive impact on consolidated income and cash flow in fiscal 2005. After more than nine months since the roll-out of the Hardee's Thickburger menu, we determined that certain restaurants with a track record of poor performance did not fit within our new menu strategy and simply could not respond to the changes we've made. These restaurants are generally older units in poor locations that would require significant capital expenditures to upgrade the facilities. In short, they suffer from problems the Hardee's Revolution cannot cure." "As our recent period 13 same-store sales report shows, the Hardee's Revolution has shown continued system-wide momentum. Assuming continued success, we do not anticipate further closings of this magnitude. We remain committed to our strategy for Hardee's and believe the actions we are taking now will enhance both profitability and the ultimate success of the brand." During the fourth quarter, the Company made the decision to close 28 Hardee's restaurants; actual restaurant closures are scheduled to take place during the Company's first fiscal quarter of 2005. Of the 28 restaurants to be closed, nine are restaurants that have upcoming lease expirations within the next six months, nine are restaurants for which the Company will have ongoing lease obligations, and 10 are restaurants for which the Company owns the land and building and that will be marketed for sale. In the first fiscal quarter of 2005, when the 28 Hardee's restaurants slated for closure are actually closed, the Company expects to take charges of approximately $2.5 million related to lease reserves. Impairment of Goodwill - La Salsa Commenting on the fourth quarter impairment of goodwill for La Salsa, Puzder stated, "Since our acquisition of the La Salsa brand in March 2002, we've been working on developing a new strategy for the brand that elevates it beyond current notions of fast-casual Mexican. We are committed to taking the necessary time to ensure the right strategy for the brand. However, for now, we've reduced our expectations for unit growth and operating performance. The impairment of goodwill reflects an adjustment in these expectations." In January, CKE retained a third-party firm to perform a valuation of the La Salsa brand. Based on CKE's reduced expectations for the brand, the carrying value of La Salsa was determined to exceed the fair value. As such, CKE expects to take a goodwill impairment charge between $30 and $34 million. Continued Puzder, "I've asked Mike Liby, La Salsa's chief operating officer, to set certain specific and achievable goals for La Salsa's future. This includes an analysis of La Salsa's potential impact on the Company's cash flow and profits and when La Salsa's reasonably anticipated unit economics would support substantial and long-term franchise growth. We continue to believe in the emerging fast-casual dining opportunity and that La Salsa presents a potential new avenue of growth for CKE." About CKE Restaurants, Inc. CKE Restaurants, Inc. (S&P, B Corporate Credit Rating, Negative), through its subsidiaries, franchisees and licensees, operates over 3,200 restaurants, including 1,000 Carl's Jr. restaurants, 2,181 Hardee's restaurants, and 97 La Salsa Fresh Mexican Grills in 44 states and in 14 countries. For more information, go to http://www.ckr.com/ COMDISCO: Paying Contingent Distribution Rights Holders on Mar 4 ---------------------------------------------------------------- Comdisco Holding Company, Inc. (OTC:CDCO) announced that it will make a cash payment of $.0187 per right on the contingent distribution rights (OTC:CDCOR), payable on March 4, 2004 to contingent distribution rights holders of record on February 23, 2004. The aggregate payment of approximately $2.8 million is primarily an incremental payment related to the amended present value of distributions to the initially allowed general unsecured creditors in the bankruptcy estate of Comdisco, Inc. disclosed in a Form 8- K/A filed with the SEC on December 16, 2003. Comdisco Holding Company has approximately 152.3 million contingent distribution rights outstanding. Comdisco Holding Company, Inc. also announced that $482 thousand of disputed claims in the bankruptcy estate of Comdisco, Inc. were allowed, and that the appropriate distribution from the disputed claims reserve has been made to such newly allowed general unsecured creditors. No supplemental distribution from the disputed claims reserve was made to previously allowed general unsecured creditors. Therefore, the present value of distributions to the initially allowed general unsecured creditors in the bankruptcy estate of Comdisco, Inc. remains at approximately $3.461 billion and the percentage recovery to such creditors remains at approximately 95 percent. Contingent Distribution Rights - Effect on Common Stock The plan of reorganization of the company's predecessor, Comdisco, Inc., entitles holders of Comdisco Holding Company Inc.'s contingent distribution rights to share at increasing percentages in proceeds realized from Comdisco Holding Company Inc.'s assets after the minimum percentage recovery threshold was achieved in May, 2003. The amount due contingent distribution rights holders is based on the amount and timing of distributions made to former creditors of the company's predecessor, Comdisco, Inc., and is impacted by both the value received from the orderly sale or run- off of Comdisco Holding Company Inc.'s assets and on the resolution of disputed claims still pending in the bankruptcy estate of Comdisco, Inc. As the disputed claims are allowed or otherwise resolved, payments are made from funds held in a disputed claims reserve established in the bankruptcy estate for the benefit of former creditors of Comdisco, Inc. Since the minimum percentage recovery threshold has been exceeded, any further payments from the disputed claims reserve to former creditors of Comdisco, Inc. entitle holders of contingent distribution rights to receive payments from Comdisco Holding Company, Inc. The amounts due to contingent distribution rights holders will be greater to the extent that disputed claims are disallowed. The disallowance of a disputed claim results in a distribution from the disputed claims reserve to previously allowed creditors that is entirely in excess of the minimum percentage recovery threshold. In contrast, the allowance of a disputed claim results in a distribution to a newly allowed creditor that is only partially in excess of the minimum percentage recovery threshold. Therefore, any disallowance of the remaining disputed claims would require Comdisco Holding Company, Inc. to pay larger cash amounts to the contingent distribution rights holders that would otherwise be distributed to common shareholders. After the quarterly distribution on February 13, 2004, the remaining disputed claims in the bankruptcy estate of Comdisco, Inc. were approximately $289 million. About Comdisco Comdisco emerged from chapter 11 bankruptcy proceedings on August 12, 2002. The purpose of reorganized Comdisco is to sell, collect or otherwise reduce to money in an orderly manner the remaining assets of the corporation. Pursuant to Comdisco's plan of reorganization and restrictions contained in its certificate of incorporation, Comdisco is specifically prohibited from engaging in any business activities inconsistent with its limited business purpose. Accordingly, within the next few years, it is anticipated that Comdisco will have reduced all of its assets to cash and made distributions of all available cash to holders of its common stock and contingent distribution rights in the manner and priorities set forth in the Plan. At that point, the company will cease operations and no further distributions will be made. COMSTOCK: S&P Ups Corporate Credit Rating to BB- over Refinancing ----------------------------------------------------------------- Standard & Poor's Ratings Services raised its corporate credit rating on Comstock Resources Inc. to 'BB-'from 'B+' following a review of current and expected credit quality, in light of the recently announced refinancing of its unsecured debt. The outlook is stable. Frisco, Texas-based Comstock has about $300 million of debt. "The rating upgrade reflects the expected costs savings from refinancing the 11.25% senior notes due 2007, which could save Comstock up to 27 cents per thousand cubic feet equivalent (mcfe) in the near term, depending on the cost of any new debt used in the tender offer and Comstock's ability to further repay debt during 2004," said Standard & Poor's credit analyst Paul B. Harvey. "The transaction should lower Comstock's all-in costs structure to near $3.00 per mcfe, resulting in increased cash flows to fund its exploration and development program and lessening its potential cash burn rate in a severe industry downturn," he continued. In addition, Comstock is expected to maintain its improved capital structure, working toward a goal of 45% debt leverage. Although there are no acquisitions expected in the near term, any significant acquisition is expected to be funded with an equity component that would maintain debt leverage of 50% or less, which is a much more moderate leverage target than the company has expressed in the past. Standard & Poor's expects that natural gas prices and the company's EBITDAX interest coverage will moderate in 2004, with Comstock's EBITDAX interest coverage averaging about 8x on Standard & Poor's base case. However, if natural gas prices remain at current levels for the remainder of the year, EBITDAX interest coverage could approach 12x. Standard & Poor's believes that Comstock's EBITDAX interest coverage would drop to about 4x in a cyclical trough, which would likely leave the company with either accessing external capital to fund sustaining capital expenditures or shrinking. The stable outlook reflects the likelihood of further improvement in Comstock's capital structure as excess cash flows are used to continue reduction of outstanding bank debt. The outlook assumes any acquisitions will be financed in a balanced manner so as to not weaken progress that has been made in Comstock's capital structure and liquidity. CONSOL ENERGY: Ex-Majority Shareholder Sells Remaining Shares ------------------------------------------------------------- CONSOL Energy Inc.'s (NYSE: CNX) former majority shareholder, RWE of Essen, Germany, has agreed to sell its remaining 16.6 million shares of CONSOL Energy common stock in a private placement sale. On September 23 and 24, 2003, RWE closed on a previously announced sale of 14.1 million shares of CONSOL Energy common stock, reducing its initial majority interest from 73.6% to 48.9%. On the same dates, CONSOL Energy closed on a previously announced sale of 11.0 million primary shares of its common stock, increasing the total shares of common stock outstanding to 89.8 million. On October 2, RWE closed on the sale of an additional 27.3 million shares of CONSOL Energy common stock. That sale reduced RWE's ownership to 16.6 million shares, or 18.5 percent. The shares of common stock offered have not been registered under the Securities Act of 1933 and may not be offered in the United States absent registration or an applicable exemption from registration requirements. CONSOL Energy Inc. (S&P, BB- Corporate Credit Rating, Negative)is the largest producer of high-Btu bituminous coal in the United States. CONSOL Energy has 19 bituminous coal mining complexes in seven states. In addition, the company is one of the largest U.S. producers of coalbed methane with daily gas production of approximately 146.2 million cubic feet from wells in Pennsylvania, Virginia and West Virginia. The company also has a joint-venture company to produce natural gas in Virginia and Tennessee, and the company produces electricity from coalbed methane at a joint- venture generating facility in Virginia. CONSOL Energy Inc. has annual revenues of $2.2 billion. It received the U.S. Department of the Interior's Office of Surface Mining National Award for Excellence in Surface Mining for the company's innovative reclamation practices in 2002 and 2003. Also in 2003, the company was listed in Information Week magazine's "Information Week 500" list for its information technology operations. In 2002, the company received a U.S. Environmental Protection Agency Climate Protection Award. Additional information about the company can be found at its web site: http://www.consolenergy.com/ CONTINENTAL AIRLINES: Fitch Affirms Junk Ratings & Revises Outlook ------------------------------------------------------------------ Fitch Ratings has affirmed the senior unsecured debt rating of Continental Airlines, Inc. at 'CCC+'. In addition, the rating for Continental's TIDES preferred equity securities has been affirmed at 'CCC-'. The Rating Outlook for Continental has been revised to Stable from Negative. Ratings for Continental reflect ongoing concerns regarding the company's ability to deliver substantial improvements in its credit profile in the face of a heavy debt and lease burden, significant cash obligations related to upcoming debt maturities, and a relatively constrained liquidity position. Senior management remains focused on a goal of delivering break-even profitability results in 2004, but persistently high jet fuel costs and a weak pricing environment will limit the airline's capacity to show significant gains in operating cash flow generation this year. With a need to maintain cash balances at or above current levels to safeguard against the risk of external shocks, Continental will likely make only limited progress toward debt reduction and balance sheet repair over the next year. Modest recovery in air travel demand patterns and improving unit revenue results, however, support the revision of Continental's Rating Outlook. Mainline passenger revenue per available seat mile grew by 4% year-over-year in the fourth quarter. This was driven by a 4 percentage point increase in load factor. At the same time, yields fell by 2% as Continental's business fare mix weakened. The broadening impact of low-cost carrier competition in key markets such as Newark-San Francisco contributed to a 5 percentage point drop in Continental's business fare revenue mix (31% in Q4 2003 versus 36% in the year-earlier period). Clearly, intensifying yield pressure will make it difficult for Continental to show meaningful improvement in domestic unit revenue during 2004. In international markets, prospects for better load factors and yields are good, reflecting a solid recovery from depressed bookings tied to the Iraq War and SARS in the first half of 2003. Any unit revenue recovery seen in 2004 may well be offset by high fuel costs. Fourth quarter jet fuel prices averaged 85 cents per gallon (excluding taxes), and management expects average prices in 2004 to remain above 90 cents per gallon. Continental has no fuel hedging in place for 2004 jet fuel purchases. Unit cost pressures related to aircraft maintenance, landing fees and terminal rents (following recently completed expansion projects at Newark-Liberty and Houston Bush Intercontinental Airports) will likely prevent Continental from driving mainline cost per available seat mile down in 2004-in spite of a projected mainline capacity growth rate of 6.5% this year. Continental's lower labor cost structure has, over the last several years, allowed it to maintain a unit cost advantage over its major network carrier competitors. Still, labor cost reduction programs completed by the restructured carriers (American and United) have virtually eliminated Continental's former cost advantage. Contracts with pilots and mechanics are amendable and under negotiation now. It remains to be seen, however, if Continental can again drive unit labor costs below those of the restructured carriers. Under any contract scenario, moreover, Continental's unit pay and benefit rates will remain well above those of the growing low-cost carrier group. Liquidity remains a source of concern for Continental in light of the carrier's exposure to external demand and fuel shocks. While total cash balances increased during 2003 primarily as a result of debt issuance and limited asset sales, Continental's unrestricted cash balance is still weak by industry standards. A year-end unrestricted cash balance of $1.4 billion (after deducting $170 in restricted cash from the total reported cash balance of $1.6 billion) represents approximately 16% of total 2003 revenues. Northwest, by comparison, had unrestricted cash balances representing approximately 28% of total annual revenues at the end of 2003. While Continental's unit costs are significantly lower than those of Northwest and Delta, the smaller liquidity buffer exposes Continental to greater event risk. Continental's liquidity situation is complicated by the fact that it retains few unencumbered assets that could be used to collateralize future secured borrowings. The company does retain equity stakes in online travel company Orbitz and Express Jet Holdings (the operator of Continental Express). Management has stated repeatedly that it does not intend to hold its investment in Express Jet for an extended period. The estimated market values of Continental's Orbitz and Express Jet stakes were approximately $83 million and $251 million, respectively, at the end of 2003. Cash obligations tied to debt maturities and pension plan funding are expected to be large in 2004 and 2005. Current maturities of debt and capital leases total $422 million for 2004, and will rise to approximately $670 million in 2005. Cash contributions to defined benefit pension plans should total approximately $300 million this year. Compared to the other network airlines, Continental's underfunded pension liability is manageable (approximately $1.0 billion underfunded on a projected benefit obligation basis as of December 31, 2003). Management has taken a proactive approach to funding its plans to levels that represent approximately 90% of the current liability (the relevant measure of pension funding as set by the Federal Government). Continental's relatively strong pension funding status provides it with an element of financial flexibility that the other major carriers clearly do not possess. CONTINENTAL AIRLINES: Fitch Affirms EETC Ratings on 3 Note Series ----------------------------------------------------------------- Fitch Ratings affirms the ratings of the following three enhanced equipment trust certificate transactions backed by payments from Continental Airlines Inc.: Continental Airlines FEATS, series 2000; and Aircraft Indebtedness Repackaging Trust series 1998-1 and series 1998-2. The affirmed ratings as shown below are also removed from Rating Watch. The rating actions reflect prospects for reduced volatility of aircraft values/lease rates as well as Fitch's affirmation of Continental Airlines, Inc.'s unsecured debt rating 'CCC+' and revision of the Rating Outlook to Stable from Negative (see press release dated February 13, 2004). While it is always possible that further value impairment for many aircraft types could occur, including the aircraft that back these transactions, aircraft sector fundamentals that contribute to the volatility of aircraft values are beginning to show some signs of stability. Fitch remains concerned that these fundamentals, like supply and demand, remain very weak by historical measures and that another 'event shock' could drive the sector into another downturn. Event shocks include things like additional terrorist acts, or anything that might restrict global air traffic. These Continental transactions are structured as enhanced equipment trust certificates. EETC's function as hybrid corporate / structured bonds, with ratings tied to the unsecured corporate rating of the underlying airline. The ratings on EETC's can be significantly higher than those of the airlines' unsecured corporate obligations because of legal and structural features as well as overcollateralization. Continental Airlines is the fifth largest U.S. passenger air carrier, serving 122 domestic and 90 international destinations. As of December 31, 2003, Continental operated a mainline fleet of 355 aircraft (127 owned and 228 leased). Affirmed Ratings: Continental Airlines FEATS, series 2000 -- Class A rated 'A-'; -- Class B rated 'B+'; -- All Classes are removed from Rating Watch Negative. Aircraft Indebtedness Repackaging Trust, series 1998-1 -- Class A rated 'BB'; -- Class B rated 'B'; -- Class C is 'Paid in Full'; -- All Classes are removed from Rating Watch Negative. Aircraft Indebtedness Repackaging Trust, series 1998-2 -- Class A rated 'BB'; -- Class B rated 'B'; -- Class C is 'Paid in Full'; -- All Classes are removed from Rating Watch Negative. CREDIT SUISSE: Fitch Takes Rating Actions on 4 Securitizations -------------------------------------------------------------- Fitch has taken rating actions on the following Credit Suisse First Boston (CSFB) mortgage pass-through certificates: Credit Suisse First Boston, mortgage pass-through certificates, series 2002-26 Group 1 -- Class IA affirmed at 'AAA'; -- Class IB1 upgraded to 'AAA' from 'AA'; -- Class IB3 upgraded to 'A' from 'BBB-'; -- Class IB4 upgraded to 'BBB' from 'BB'; -- Class IB5 upgraded to 'BB' from 'B'. Credit Suisse First Boston, mortgage pass-through certificates, series 2002-26 Group 2 -- Class IIA affirmed at 'AAA'; -- Class IIB1 upgraded to 'AA+' from 'AA'; -- Class IIB2 upgraded to 'A+' from 'A'; -- Class IIB3 upgraded to 'BBB+' from 'BBB'; -- Class IIB5 upgraded to 'BB' from 'B'. Washington Mutual Mortgage Securities, mortgage pass-through certificates, series 2002-AR1 -- Classes IA, IIA, and IIIA affirmed at 'AAA'; -- Class CB1 upgraded to 'AAA' from 'AA'; -- Class CB2 upgraded to 'AA' from 'A'; -- Class CB3 upgraded to 'A' from 'BBB'; -- Class CB4 affirmed at 'BB'; -- Class CB5 affirmed at 'B'. Washington Mutual Mortgage Securities, mortgage pass-through certificates, series 2002-S4 -- Classes A affirmed at 'AAA'; -- Class B1 upgraded to 'AAA' from 'AA'; -- Class B2 upgraded to 'AA' from 'A-'; -- Class B3 upgraded to 'BBB+' from 'BBB-'; -- Class B4 affirmed at 'BB-'; -- Class B5 affirmed at 'B'. The upgrades are being taken as a result of low delinquencies and losses, as well as increased credit support levels. The affirmations are due to credit enhancement consistent with future loss expectations. DETROIT MEDICAL: Fitch Maintains Negative Watch on B Rating ----------------------------------------------------------- Fitch Ratings continues to monitor Detroit Medical Center and its expected improvement plan and 2004 budget. Fitch placed DMC's approximately $569 million of bonds on Rating Watch Negative on Dec. 22, 2003, due to the lack of significant improvement in DMC's overall financial performance, and little expectation of significant improvement in the near future. The bonds are rated 'B'. Fitch noted in its last press release that DMC's improvement plan and 2004 budget would be available in late January and that the rating would be reevaluated at that time. However, the improvement plan and 2004 budget have been delayed as management is currently making revisions to include initiatives recommended by Huron Consulting Group. Fitch does not expect the improvement plan by itself will be sufficient to completely stem DMC's losses, given the level of indigent care DMC provides. In the month of November 2003, DMC had an operating loss of $17.5 million resulting in a year-to-date loss (eleven months) of $123 million. With receipt of $21 million in public subsidies, the bottom line loss is $102 million through the eleven months ended Nov. 30, 2003. Fitch will evaluate the improvement plan and 2004 budget, which are now expected to be released late February, and determine if a rating change is warranted. In addition, the fiscal 2003 audit will most likely be completed in March and management has indicated that an investor conference call may be scheduled around that time. DMC operates nine hospitals, seven of which serve the metropolitan Detroit area. DMC is the largest health care provider in the Detroit market, with 11,954 full-time equivalent employees and about $1.6 billion in annual revenues. DMC does not covenant to provide quarterly disclosure to bondholders, as was standard during DMC's last bond offering in 1998. However, DMC proactively provides monthly financial statements to bondholders and other interested parties requesting to be on its distribution list, a practice which Fitch views favorably. Outstanding debt: -- $108,650,000 Michigan State Hospital Finance Authority revenue and refunding bonds (Detroit Medical Center Obligated Group), series 1998A; -- $174,460,000 Michigan State Hospital Finance Authority revenue and refunding bonds (Detroit Medical Center Obligated Group), series 1997A*; -- $42,615,000 Michigan State Hospital Finance Authority revenue and refunding bonds (Sinai Hospital of Greater Detroit), series 1995; -- $131,445,000 Michigan State Hospital Finance Authority revenue and refunding bonds (Detroit Medical Center Obligated Group), series 1993B*; -- $109,320,000 Michigan State Hospital Finance Authority revenue and refunding bonds (Detroit Medical Center Obligated Group), series 1993A; -- $2,575,000 Michigan State Hospital Finance Authority revenue and refunding bonds (Detroit Medical Center Obligated Group), series 1988A and 1988B. *This is an underlying rating. The bonds are insured by Ambac Assurance Corporation, whose insurer financial strength is rated 'AAA' by Fitch. DIRECTV: Delaware Court Confirms First Amended Reorganization Plan ------------------------------------------------------------------ The U.S. Bankruptcy Court in Wilmington, Delaware confirmed DirecTV Latin America, LLC's Plan of Reorganization, setting the stage for the Company to emerge from Chapter 11. The Company expects that the Plan of Reorganization will become effective by the end of February 2004. As previously announced, the Company filed for relief under Chapter 11 of the U.S. Bankruptcy Code in March 2003 in order to aggressively address its financial and operational challenges. The filing applied only to the U.S. entity and did not include any of the operating companies in Latin America and the Caribbean, which have continued regular operations. "This is an important development for the Company and our employees, with the conclusion of the Chapter 11 process now clearly in sight," said Larry N. Chapman, President and Chief Operating Officer of DIRECTV Latin America, LLC. "Through the Chapter 11 process we have successfully accomplished what we set out to do, namely taking the actions we believed were necessary to strengthen our company and ensure our continued ability to offer our customers outstanding programming and entertainment." DIRECTV is a leading direct-to-home satellite television service in Latin America and the Caribbean. Currently, the service reaches approximately 1.5 million customers in the region, in a total of 28 markets. DIRECTV is currently available in: Argentina, Brazil, Chile, Colombia, Costa Rica, Ecuador, El Salvador, Guatemala, Honduras, Mexico, Nicaragua, Panama, Puerto Rico, Trinidad & Tobago, Uruguay, Venezuela and several Caribbean island nations. DIRECTV Latin America, LLC is a multinational company owned by DIRECTV Latin America Holdings, a subsidiary of Hughes Electronics Corporation, and Darlene Investments, LLC, an affiliate of the Cisneros Group of Companies. DIRECTV Latin America and its principal operating companies have offices in Buenos Aires, Argentina; Sao Paulo, Brazil; Cali, Colombia; Mexico City, Mexico; Carolina, Puerto Rico; Fort Lauderdale, USA; and Caracas, Venezuela. For more information on DIRECTV Latin America please visit http://www.directvla.com Hughes Electronics Corporation is a world-leading provider of digital multichannel television entertainment, broadband satellite networks and services, and global video and data broadcasting. Section 1129(a) Requirements Judge Walsh finds that the 1st Amended Plan satisfies the 13 statutory requirements under Section 1129(a) of the Bankruptcy Code necessary to confirm the Plan: (A) Section 1129(a)(1) provides that a reorganization plan must comply with the applicable provisions of the Bankruptcy Code. The legislative history and subsequent case law indicate that this provision requires that a plan satisfy Sections 1122 and 1123 of the Bankruptcy Code, which govern the classification of claims and the contents of the plan. Specifically: 1. Pursuant to Sections 1122(a) and 1123(a)(1), the Plan designates Classes of Claims and Old DTVLA Membership Interests, other than Administrative Expense Claims, Priority Tax Claims and DIP Facility Claims, which are not required to be classified. Moreover, the Classification of the Put Agreement Claims and Interests is proper and consistent with Sections 1122(a) and 1123(a)(1). 2. The Plan satisfies requirements of Section 1123(a)(2). The Plan specifies all Claims and Old DTVLA Membership Interests that are not impaired and specifies the treatment of all Claims and Old DTVLA Membership Interests that are impaired. In accordance with Section 1123(a)(4), the Plan also provides the same treatment for each Claim or Old DTVLA Membership Interests within each particular Class. 3. The Plan provides adequate means for its implementation, satisfying Section 1123(a)(5). In particular, the Plan provides for the provision of Exit Funding on terms which are reasonable, appropriate and that will provide sufficient liquidity to the Debtor to satisfy all obligations under the Plan and to fund business operations on a going forward basis. (B) Section 1129(a)(2) requires that the plan proponent comply with the applicable provisions of the Bankruptcy Code. The solicitation of acceptances and rejections of the Plan was: 1. in compliance with the procedures set forth in the Approval Order and applicable law; and 2. solicited after the distribution to Claimholders or Old DTVLA Membership Interests of the Disclosure Statement containing adequate information. Moreover, the releases and injunction provisions in the Plan are appropriate under the legal standard governing approval of the provisions in the Third Circuit Court of Appeal. Specifically, the Court finds that: 1. The Debtor and the Releases share an identity of interest; 2. The Releases have made a substantial contribution to the Debtor's reorganization including the provision by Hughes of the Exit Funding, the agreement by Hughes to the conversion of its DIP Facility Claim into equity in the Reorganized Debtor in exchange for the $2,000,000,000 of claims against the Debtor held by Hughes and its affiliates, and the contribution of assets by Hughes and Darlene pursuant to the Roll-Up Transaction; 3. The releases are essential to the success of the Debtor's reorganization because Hughes would not fund the Plan absent the releases provision; 4. The holders of General Unsecured Claims have overwhelmingly accepted the Plan; and 5. The Plan, which depends on receipt of funding by Hughes -- and which funding is predicated on the releases -- provides for the distribution to the General Unsecured Creditors, who would not receive any distribution in a liquidation of the Debtor. (C) As Section 1129(a)(3) requires, the Plan has been proposed in good faith and not by any means forbidden by law. The Plan is designed to allow the Debtor to reorganize by providing it with the means to substantially de-leverage its balance sheet and restructure its Programming Agreements, and thus realize the benefits of a financial reorganization that enables the Debtor to satisfy obligations with sufficient liquidity and capital resources to conduct its business in a going forward basis. Moreover, the Plan and the process leading to its formulation, including involvement and negotiation by the Creditors Committee, provides independent evidence of the Debtor's good faith. (D) The Plan satisfies the requirement of Section 1129(a)(4) that certain professional fees and expenses paid by the plan proponent, by a debtor, or by a person receiving distributions of property, be subjected to Court approval. (E) As required by Section 1129(a)(5), the Plan Proponents have disclosed the identity and other relevant information with respect to all individuals of the Reorganized Debtor. The Court finds and concludes that the appointment or continuation of the individuals is consistent with the interests of the Claimholders and with public policy. (F) The Plan does not contain any rate changes subject to the jurisdiction of any governmental regulatory commission. Section 1129(a)(6) is inapplicable to the confirmation of the Plan. (G) The Plan is in the best interests of creditors and equity interest holders pursuant to Section 1129(a)(7). The Debtor demonstrated that the range of recoveries in a Chapter 7 liquidation is insufficient to fully satisfy the DIP Facility Claim and other administration claims and, therefore, there would be no value available for distribution to General Unsecured Claimholders. The Court finds that Claimholders would not recover under a Chapter 7 liquidation even if the Chapter 7 Trustee were successful in pursuing claims against Hughes and its affiliates. (H) Section 1129(a)(8) requires that each class of claims or interests that is impaired under the plan accept the plan. Class 3 and 4 have voted to accept the Plan. Claimholders and Old DTVLA Membership Interests in Classes 5, 6 and 7 are not receiving any distribution from the Debtor on account of their claims and are, thus, deemed to have rejected the Plan. As a result, with respect to Class 5, 6 and 7, the Plan does not comply with Section 1129(a)(8), but instead, satisfy the "cramdown" requirement set forth in Section 1129(b). Therefore, the Plan is fair and equitable with respect to each of the rejecting Classes. The Plan does not discriminate unfairly with respect to Classes 5, 6 and 7. (I) Except to the extent that the Claimholders agrees to a different treatment of their claims, the Plan provides that Administrative Expense Claims, Non-Tax Priority Claims and Priority Tax Claims will be paid in full accordance with Section 1129(a)(9). Moreover, Hughes has agreed to accept a portion of the Class 3 Share on account of its DIP Facility Claims. (J) Section 1129(a)(10) requires the affirmative acceptance of the Plan by at least one Class of impaired Claims, "determined without including any acceptance of the plan by any insider." Class 4 is impaired and have voted to accept the Plan. (K) Section 1129(a)(11) of the Bankruptcy Code requires the Bankruptcy Court to find that the plan is feasible as a condition precedent to confirmation. The Debtor has provided detailed financial projections to creditors in the Disclosure Statement. Those projections demonstrate that, reorganized and deleveraged, DirecTV will be on solid financial ground and there will be no need for further financial restructuring. (L) Section 1129(a)(12) requires the payment of all fees payable under 28 U.S.C. Section 1930. The Debtor has paid, or will pay on or before the Effective Date, all amounts due under 28 U.S.C. Section 1930 regardless of whether the fees accrued prior to entry of the Confirmation Order or until such time as the Court closes the case by final decree. The Debtor will also comply with any postconfirmation reporting requirements, inclusive of disbursement information. (M) Section 1129(a)(13), which requires the continuation of Retiree Benefits, does not apply to the Debtor's Plan. Accordingly, Judge Walsh confirms the Debtor's Plan. The United States Trustee and Televisa SA de CV filed objections to the confirmation of the Plan. To the extent not withdrawn or resolved, Judge Walsh overrules the objection. (DirecTV Latin America Bankruptcy News, Issue No. 20; Bankruptcy Creditors' Service, Inc., 215/945-7000) D.R. HORTON: S&P Ups Credit & Senior Debt Ratings a Notch to BB+ ---------------------------------------------------------------- Standard & Poor's Ratings Services raised its corporate credit and senior debt ratings on D.R. Horton Inc. to 'BB+' from 'BB'. At the same time, the outlook is revised to stable from positive. The rating actions impact approximately $2.75 billion in outstanding debt. "The upgrade acknowledges Horton's commitment to an organic growth strategy and lower leverage levels over the past year, which has materially improved the company's financial profile. This well- diversified national homebuilder's above-average margins improved over the past year as well, and efforts to strengthen inventory turns continue," said Standard & Poor's credit analyst Elizabeth Campbell. Arlington, Texas-based Horton ranks as one of the largest builders in the nation, based on home closings (37,662 for the 12-months ended Dec. 31, 2003), and has among the largest sales backlogs in the industry at more than $3.5 billion. ENCOMPASS: Todd Matherne Wants 25 Claims Disallowed & Expunged -------------------------------------------------------------- The Encompass Debtors' Disbursing Agent, Todd A. Matherne, asks the Court to expunge 25 Claims, including: Claimants Claim No. Claim Amount --------- --------- ------------ Kelly Coleman 4730 $2,000,000 Joanne Donat 4833 500,000 Cleto Diaz 4843 152,000 Perry Boggs 4812 150,000 Monique Correales 4889 50,000 RS Properties, Inc. 3206 10,000 Stop & Shop, Inc. 1351 15,000 W. Grosenheider & Jacobs 801 26,660 TJX Cos., Inc. 4844 4,000,000 4841 2,000,000 "The Claimants don't have a right to payment from the Debtors' estate," Marcy E. Kurtz, Esq., at Bracewell & Patterson, LLP, in Houston, Texas, contends. Ms. Kurtz explains that the Claims, if determined to be valid obligations, will be fully funded by the Debtors' insurance policies. (Encompass Bankruptcy News, Issue No. 24; Bankruptcy Creditors' Service, Inc., 215/945-7000) ENRON: Obtains Nod to Expand Stephen Cooper's Engagement Scope -------------------------------------------------------------- The Enron Corporation Debtors sought and obtained U.S. Bankruptcy Judge Gonzalez's approval to expand the retention of Stephan Forbes Cooper LLC, nunc pro tunc to October 21, 2003, to provide four additional Associate Directors of Restructuring to work for the Debtors. The four Additional Employees are: (1) John C. Auerbach, (2) Daniel E. Karson, (3) Andres Antonius, and (4) Thomas J. Sterner. In accordance with the Agreement, the Debtors will pay Cooper $549,600 annually, calculated as the average for three Additional Employees on the basis of 160 hours per month as a full equivalent and one Additional Employee on the basis of 80 hours per month as a part-time equivalent. The Additional Employees are employees of Kroll, Inc., an internationally recognized independent risk consulting company. Kroll is the entity that is the beneficial recipient of proceeds paid to Stephen Forbes Cooper, LLC, pursuant to a management agreement, under which Cooper provides management services to the Debtor, including the Acting Chief Executive Officer, Chief Restructuring Officer and Associate Directors of Restructuring. The Additional Employees will provide services to the Debtors as employees of Cooper. They will provide asset location and investigation services in connection with ongoing settlement and litigation efforts. However, the Additional Employees will not investigate any individuals or entities with a relationship to themselves, Kroll Zolfo Cooper LLC, Cooper or Kroll, Inc. (Enron Bankruptcy News, Issue No. 97; Bankruptcy Creditors' Service, Inc., 215/945-7000) EREWHON MOUNTAIN: Hilco Merchant To Conduct Store Closing Sales --------------------------------------------------------------- Hilco Merchant Resources has been selected to manage the going out of business sale at all six Erewhon Mountain Outfitter stores in the Chicagoland and Madison, Wisconsin areas. Erewhon Mountain Outfitter is known for its outstanding selection of equipment used in mountain climbing, hiking, backpacking, canoeing, skiing and other outdoor activities. Store closing sales began Thursday, February 12, 2004. Over $6 million of inventory is being liquidated, including top-of-the- line, high quality outdoor apparel and outdoor gear for men, women and children involved in camping, hiking, climbing, snow sports and much more. Significant discounts are now being offered on all merchandise in all stores. Consumers will be able to take advantage of significant savings on every item in every department. Michael Keefe, President of Hilco Merchant Resources stated, "This is an outstanding opportunity for every outdoor enthusiast to realize unprecedented savings on a remarkable selection of the best brand names in outdoor apparel and gear for every season. This is sure to be a great sale because there's still plenty of time for winter activities, yet spring is right around the corner. With brands like North Face, Patagonia, Columbia Sportswear, Merrell, Salomon, Marmot, Arc'Teryx, Oakley and Yakima, the selection won't last long." Based in Northbrook, Illinois, Hilco Merchant Resources -- http://www.hilcomerchantresources.com/-- provides high-yield strategic retail inventory liquidation and store closing services. Over the years, Hilco principals have disposed of assets valued in excess of $30 billion. Hilco Merchant Resources is part of the Hilco Organization, a provider of asset valuation, acquisition, disposition and financing to an international marketplace through nine specialized business units. The Store Closing Sale Is Being Conducted at These Locations: Street City and State Phone Number 2585 Waukegan Road Bannockburn, IL 847-948-7250 1800 North Clybourn Chicago, IL 312-337-6400 20505 North Hwy 12 Kildeer, IL 847-726-1301 201 Orland Park Place Orland Park, IL 708-364-1100 9705 Skokie Blvd. Skokie, IL 847-933-1200 7948 Tree Lane Madison, WI 608-833-9191 ESSELTE: S&P Assigns Low-B Level Credit & Euro Sub. Note Ratings ---------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BB-' corporate credit rating to office supplies manufacturer Esselte Group Holdings AB. At the same time, Standard & Poor's assigned its 'B' rating to the company's ?130 million senior subordinated notes due 2011. Proceeds of the notes will be used to make an intercompany loan to Esselte Sverige AB to fully repay existing mezzanine debt. They will also be used for a follow-on loan to Esselte AB (the operating company) to repay a portion of the term loans on its existing senior credit facilities, plus associated transaction fees and expenses. The outlook on Esselte Group Holdings is stable. Total debt outstanding at Dec. 31, 2003, pro forma for the refinancing, was $420 million. Stamford, Connecticut-based Esselte is a leading office supplies manufacturer and marketer, providing filing products (file folders/systems and index cards); labeling products (label writers and tape) and workspace products (staples, letter trays, binding, and lamination) to the global market. Standard & Poor's analyzes Esselte Group Holdings AB, its subsidiary Esselte Sverige, and Esselte AB on a consolidated basis. "The newly assigned ratings reflect Esselte's constrained discretionary cash flow, its highly competitive operating environment, and the low-growth niche market in which it operates," said Standard & Poor's credit analyst Martin S. Kounitz. "These factors are mitigated by Esselte's leading market positions in each of its core product lines, its diversified revenue base and distribution channels, its high operating efficiency, and stable cash flows." Esselte faces several challenges in its markets. The company has a somewhat narrow product scope in a mature industry with competitive pricing. However, it participates in the high-end and middle-end of the market and has strong established brands, and these factors somewhat alleviate pricing pressure. Nonetheless, Standard & Poor's expects that the company will be challenged to achieve sustainable top-line revenue growth in this low-growth, niche area. Sales growth and profitability for the company's DYMO labeling product lines are strong, and will allow Esselte to expand into markets such as PC/desktop label writers that make use of current technologies. However, revenue and profitability growth in other business lines such as filing (which contributes two-thirds of Esselte's total revenues), has been driven by favorable foreign exchange rates rather than organic sales growth. The largest portion of the company's revenues are in euros (approximately 57% in 2003) while its revenues are reported in U.S. dollars, allowing the company to benefit from the appreciation of the European currency. Standard & Poor's expects that the company, to increase revenues, will continue to focus efforts on markets such as the Asia Pacific region, where it has expanded its sales and marketing teams. EXIDE: Obtains Clearance for Heller Stipulation Re Equipment Lease ------------------------------------------------------------------ On May 19, 2000, the Exide Tech. Debtors entered into an agreement with Heller Financial Leasing, Inc., pursuant to which Heller committed to purchase up to $4,000,000 of computer, office and forklift equipment along with all additions, replacements, substitutions, modifications, attachments and proceeds. The Debtors extended the Agreement for a lease facility to purchase an additional $1,900,000 worth of similar equipment. The Debtors leased the equipment for use in various facilities. On August 25, 2000, the Debtors and Heller entered into a Master Lease Agreement, wherein the Debtors leased various equipment. The Debtors sought to reject the Leases on October 27, 2003. To avoid a dispute subsequent to the rejection, the parties held discussions, and have, therefore, stipulated and agreed that: (a) The Debtors will withdraw their request to reject the Leases; (b) The Debtors will purchase the equipment subject to the Leases for $1,080,575, which will be paid in two parts: -- Heller will be permitted to retain $650,575, which it drew down from three separate letters of credit securing the Leases; and -- $430,000 plus interest to be paid in accordance with the Bill of Sale, Promissory Note and Secur1ity Agreement; (c) The Debtors will be authorized and empowered to execute and deliver all documents, and to do any and all acts, as required under the Sale Documents and that may reasonably be necessary to implement the terms of the Stipulation and Agreed Order; (d) The Leases will be terminated; and (e) The Parties waive and release any and all claims that they have or may have against each other relating to the Leases. * * * Accordingly, the Court approves the stipulation. Headquartered in Princeton, New Jersey, Exide Technologies is the world-wide leading manufacturer and distributor of lead acid batteries and other related electrical energy storage products. The Company filed for chapter 11 protection on April 14, 2002 (Bankr. Del. Case No. 02-11125). Matthew N. Kleiman, Esq., and Kirk A. Kennedy, Esq., at Kirkland & Ellis, represent the Debtors in their restructuring efforts. On April 14, 2002, the Debtors listed $2,073,238,000 in assets and $2,524,448,000 in debts. (Exide Bankruptcy News, Issue No. 40; Bankruptcy Creditors' Service, Inc., 215/945-7000) EXIDE TECH: Obtains Court Nod for $375 Million Financing Package ---------------------------------------------------------------- Exide Technologies (OTCBB: EXDTQ), a global leader in stored electrical energy solutions, announced that it has received interim approval from the U.S. Bankruptcy Court for the District of Delaware for $375 million in debtor-in-possession financing to replace its current DIP financing, which is set to mature on February 15, 2004. The replacement DIP facility will be provided by a group of lenders for which Deutsche Bank AG New York Branch is acting as Administrative Agent. In addition to immediately replacing the prior DIP financing, the replacement DIP refinances the Company's European accounts receivable securitization facility and provides additional working capital borrowing availability of up to $40 million. The replacement DIP facility includes an aggregate financing commitment of $500 million and includes a standby commitment to refinance the Company's 9.125% Senior Notes, which are due April 15, 2004, conditioned on the Bankruptcy Court's issuance of a final order approving the replacement DIP, the Company's filing of a plan of reorganization and the Bankruptcy Court's approval of a disclosure statement related thereto reasonably satisfactory to the lending group and Deutsche Bank. Finally, the lending group has extended its commitment to May 15, 2004, to provide financing upon Exide's emergence from Chapter 11. The replacement DIP and financing commitments are subject to customary financial and legal conditions, and the Company will seek final approval of the replacement DIP facility on March 15, 2004. Craig H. Muhlhauser, Chairman, Chief Executive Officer and President of Exide Technologies, said, "Approval of the replacement financing gives Exide the necessary resources and flexibility to ensure normal business operations now, as we continue to work on finalizing the terms of a plan of reorganization with our creditors, and after emergence from Chapter 11." About Exide Technologies Exide Technologies, with operations in 89 countries and fiscal 2003 net sales of approximately $2.4 billion, is one of the world's largest producers and recyclers of lead-acid batteries. The Company's three global business groups - transportation, motive power and network power - provide a comprehensive range of stored electrical energy products and services for industrial and transportation applications. Transportation markets include original-equipment and aftermarket automotive, heavy-duty truck, agricultural and marine applications, and new technologies for hybrid vehicles and 42-volt automotive applications. Industrial markets include network power applications such as telecommunications systems, fuel-cell load leveling, electric utilities, railroads, photovoltaic (solar-power related) and uninterruptible power supply (UPS), and motive-power applications including lift trucks, mining and other commercial vehicles. Further information about Exide and its financial results are available at http://www.exide.com/. FIRST PAGE ASSOCIATES: Case Summary & Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: First Page Associates, Inc. dba Windovations dba Megawood Industries 2400 Vauxhall Road Union, New Jersey 07083 Bankruptcy Case No.: 04-14796 Type of Business: The Debtor promotes, designs, sells, and projects manage architecturally significant window, door and skylight projects in the Northern Atlantic States area utilizing the unique manufacturing expertise of Megawood Industries and Infinity Bronze. See http://www.windovations.com/ Chapter 11 Petition Date: February 13, 2004 Court: District of New Jersey (Newark) Judge: Donald H. Steckroth Debtor's Counsels: Michael P. Pompeo, Esq. Michael Joseph Reynolds, Esq. Robert Malone, Esq. Drinker, Biddle & Reath 500 Campus Drive Florham Park, NJ 07932 Tel: 973-360-1100 Fax: 973-360-9831 Estimated Assets: $1 Million to $10 Million Estimated Debts: $1 Million to $10 Million Debtor's 20 Largest Unsecured Creditors: Entity Nature Of Claim Claim Amount ------ --------------- ------------ Window Gold LLC Loan $2,790,000 8 Woodland Road Maplewood, NJ 07040 Hopes Windows Trade Debt $683,793 84 Hopkins Avenue P.O. Box 580 Jamestown, NY 14702 Relsen-Siedel Hardwood Trade Debt $130,149 First Union Bank Loan $125,000 American Express Trade Debt $66,759 Roger K. Braman Trade Debt $60,165 Sienna Custom Window & Door Trade Debt $49,622 Sax Macy Fromm & Company, PC Trade Debt $26,380 Weather-Eye Insulation Glass Trade Debt $24,555 Inc. Newark Industrial Spraying, Trade Debt $24,545 Inc. H & S Graphics, Inc. Trade Debt $24,491 Consolidated Extrusions Trade Debt $23,831 Chemical Building Supplies Trade Debt $22,724 Inc. J. Gibson Mcllvain Company Trade Debt $17,151 Glass Pro Trade Debt $17,014 Penta Glass Industries, Inc. Trade Debt $16,754 Functional Fenestration Inc. Trade Debt $15,659 Bronze Craft Trade Debt $15,417 Julius Blum & Company, Inc. Trade Debt $13,845 Mac Metals, Inc. Trade Debt $13,796 FP BROWN & SONS: Case Summary & 11 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: F.P. Brown & Sons, A Partnership P.O. Box 85 Maringouin, Louisiana 70757 Bankruptcy Case No.: 04-10348 Chapter 11 Petition Date: February 6, 2004 Court: Middle District of Louisiana (Baton Rouge) Judge: Douglas D. Dodd Debtor's Counsel: Pamela G. Magee, Esq. 7922 Wrenwood Boulevard, Suite B Baton Rouge, LA 70809 Tel: 225-925-8770 Fax: 225-924-2469 Estimated Assets: $1 Million to $10 Million Estimated Debts: $1 Million to $10 Million Debtor's 11 Largest Unsecured Creditors: Entity Claim Amount ------ ------------ UAP Data $144,268 Cane Equipment Cooperative $82,947 Cameco Industries $14,551 Certis USA $12,880 A and C Flying Service $10,000 Agco Finance $9,281 Maringouin Car Care Center $6,855 Louisiana Auto & Truck Repair $5,496 Feed Service & Hardware Supply $4,941 Case Credit Vantage $3,500 G&K Services $317 GENTEK INC: Gets Approval for Majestic Settlement Agreement ----------------------------------------------------------- On August 1, 2001, GenTek Debtor Krone Digital Communications, Inc. filed a complaint against Majestic Management, Inc., Larry D. Large, and Optical Datacom, LLC, in the District Court, Arapahoe County, of the State of Colorado. Krone alleged that the three defendants purchased certain communications inventory but failed to pay for it. On April 4, 2002, Krone filed a complaint against Majestic, Larry Large, Optical Datacom Inc., Bradley Large, Bryon Large, Matthew T. Gehrke, Patrick F. Gartland, Terry McDonald, Curtis T. Erwin, and Michael Carpinelli, in the District Court, Arapahoe County, of the State of Colorado. Krone alleged that the defendant corporations and directors fraudulently transferred corporate assets to Majestic's and ODI's shareholders. To resolve their disputes, Krone and the Defendants agreed to settle the Lawsuits on these terms: (A) Amount of Payment Larry Large will pay Krone $2,225,000 in settlement of all claims made in the Lawsuits. Larry Large has wired $1,800,000 of the settlement amount. Larry Large will also either wire the additional $425,000 on November 17, 2003, or provide an irrevocable Letter of Credit from Wells Fargo in Krone's favor. If Larry Large does not pay the $425,000 by December 31, 2003, Krone may present the LOC for payment. (B) Dismissal of Lawsuits Krone will file a dismissal with prejudice of the Lawsuits, except as to the claims asserted against ODC. ODC filed for Chapter 11 protection on November 16, 2001, and with all actions against it having been stayed, it was not able to participate in the negotiations for the settlement agreement. (C) Assignment Krone will assign to Larry Large any claims that it may have against Orlando Carter, ODC, Carter Acquisition II, L.L.C., and Carter Holdings, L.L.C. that were asserted or could have been asserted in the Lawsuits, or that arise out of or relate in any way to the claims made in the Lawsuits. If Larry Large, Majestic or ODI files or commences a claim based on the assigned claims against Orlando Carter or any of his entities, and in response to those claims, a cross claim against any of the Krone-released parties is filed, Larry Large will indemnify and hold Krone harmless against any claims made by Orlando Carter, ODC, Carter Acquisition, and Carter Holdings against Krone that were asserted or could have been asserted in the Lawsuits, or that arise out of or relate in any way to the claims made in the Lawsuits. (D) Release The Settlement Agreement provides that each Defendant releases and discharges Krone from all claims, demands, suits, liabilities, debt and obligations of any kind or nature that were asserted or could have been asserted in the Lawsuits. Krone also releases and discharges each Defendant. Accordingly, the Debtors sought and obtained Court approval for the Majestic Settlement Agreement resolving various claims and settling pending litigation between Krone Digital Communications, Inc., and the Defendants pursuant to Rule 9019 of the Federal Rules of Bankruptcy Procedure. (GenTek Bankruptcy News, Issue No. 28; Bankruptcy Creditors' Service, Inc., 215/945-7000) GLIMCHER REALTY: Schedules Q4 2003 Conference Call on Feb. 19 ------------------------------------------------------------- Glimcher Realty Trust (NYSE: GRT) announces the following Webcast: What: Glimcher Realty Trust Fourth Quarter 2003 Earnings Conference Call When: Thursday, Feb. 19, 2004 at 11:00 a.m. ET Where: http://www.glimcher.com/or http://www.firstcallevents.com/service/ajwz396268128gf12.html How: Live over the Internet -- Simply log on to the web at the address above. Contact: Carolee J. Oertel, Executive Projects Manager 614-621-9000, x119, or coertel@glimcher.com If you are unable to participate during the live webcast, the call will be archived on the Web site http://www.glimcher.com/ Glimcher Realty Trust, a real estate investment trust, is a recognized leader in the ownership, management, acquisition and development of enclosed regional and super-regional malls and community shopping centers. Glimcher Realty Trust's common shares are listed on the New York Stock Exchange under the symbol "GRT". Glimcher Realty Trust is a component of both Russell 2000r Index, representing small cap stocks, and the Russell 3000r Index, representing the broader market. * * * As reported in the January 27, 2004 edition of The Troubled Company Reporter, Standard & Poor's Ratings Services assigned its 'B' rating to Glimcher Realty Trust's $150 million 8.125% series G preferred stock issuance. At the same time, Standard & Poor's affirmed its 'BB' corporate credit rating on Glimcher and its 'B' preferred stock rating. The affirmation impacts $188 million of preferred stock outstanding. The outlook is stable. "The assigned rating acknowledges Glimcher 's below-average business position and its relatively aggressive financial profile," said credit analyst Elizabeth Campbell. "The ratings are supported by a relatively well-occupied and profitable (but comparatively smaller) portfolio, which generates stable, predictable cash flow from a diverse and moderately creditworthy tenant base. Glimcher management has been successful in buying out its joint venture partners' interests in seven mall properties, which helps leverage the company's existing operating platform and reduce complexity. The company now wholly-owns all of its 25 mall properties. However, these strengths are offset by generally higher leverage and historically high bank line usage, a mostly encumbered portfolio and weak coverage of total obligations (including the common dividend), and vacancy issues in its non- core community center portfolio." GLOBAL CROSSING: Court Disallows $4.2 Million Paid Tax Claims ------------------------------------------------------------- On the Petition Date, the Court: (a) authorized the Global Crossing Debtors to pay Prepetition Sales and Use Taxes and Regulatory Fees; and (b) directed Financial Institutions to honor and process checks and transfers related to Prepetition Sales and Use Taxes and Regulatory Fees. Michael F. Walsh, Esq., at Weil, Gotshal & Manges LLP, in New York, states that the Debtors have reviewed each of the proofs of claim filed in their cases and have concluded that the obligations represented by 117 tax claims, totaling $7,952,230, have been paid in full after the Petition Date, pursuant to the Sales and Use Tax Order and various settlements entered into by the Debtors. At the Debtors' request, the Court disallows and expunges 113 of the Paid Tax Claims in their entirety. The 113 disallowed and expunged Tax Claims, aggregating $4,261,284, include: Claimant Claim No. Amount -------- --------- ------ Fairfax County, Virginia 9877 $118,044 Fulton County Tax Commissioner 1153 952,732 Indiana Department of Revenue 10966 297,735 King County Treasury Operations 10846 165,320 New York State Department of Taxation & Finance 688 318,713 23 107,356 852 212,068 State of Ohio, Dept of Taxation 1397 267,634 1398 221,352 Pennsylvania Dept of Revenue 975 175,509 Commonwealth of Pennsylvania Department of Revenue 9857 175,509 City of Phoenix 8291 104,035 The Pennsylvania Department of Revenue withdrew its claim, Claim No. 8345, for $3,684,215. The hearing on the Debtors' objection to these claims is continued: Claimant Claim No. Amount -------- --------- ------ State of Iowa 378 $5,372 City of Pasadena 6153 1,358 City of Portland 10079 0 (Global Crossing Bankruptcy News, Issue No. 55; Bankruptcy Creditors' Service, Inc., 215/945-7000) GOODYEAR: Fitch Hatchets Debt Ratings over Accounting Concerns -------------------------------------------------------------- Fitch Ratings downgraded the Goodyear Tire & Rubber Company's senior unsecured rating to 'CCC+' from 'B' and the senior secured bank facilities to 'B' from 'B+' The Rating Outlook remains Negative. Approximately $5 billion of debt(as of Sept. 30, 2003) is affected. The rating action is based on lack of resolution in the investigation and review of the company's accounting practices and certain reported financial statements. An informal inquiry by the Securities and Exchange Commission prompted by two previous company announcements (December and October 2003) of accounting problems has now escalated into a formal SEC investigation. These latest issues have further delayed the filing of timely financial statements and could hinder Goodyear's access to credit facilities and external capital markets. Access to significant external capital is required in order to meet heavy debt maturities, pension funding requirements, and other cash needs over the next few years. The delays and questions surrounding the company's financial statements have precluded the ability to track the progress of the company's critical cost restructuring program. Furthermore, Goodyear appears not to have met the terms of its latest union contract which required the company to raise external financing prior to yearend 2003. The downgrade also reflects the deterioration in the relative position of the unsecured creditors versus senior creditors due to the layering on of additional secured bank facility and the likely granting of additional security in pending and future transactions. Even as Goodyear is currently in negotiations with its banks to amend and expand its existing $1.3 billion senior secured asset- backed credit facilities (due March 2006) by $650 million of additional term loans, a material charge in its equity account resulting from the accounting problems could breach existing loan covenants. Goodyear had to meet a minimum consolidated net worth requirement of $2.8 billion for quarters ending in 2003. At Sept. 30, 2003, Goodyear's consolidated net worth amounted to $3.1 billion. A consolidated net loss in the fourth quarter plus a charge to equity accounts to reconcile accounts could potentially breach the minimum net worth threshold. The $650 million addition to the existing $1.3 billion senior secured asset-backed credit facilities currently in the works and the recently announced $650 million private financing are intended for refinancing of some earlier maturing debt as well other purposes. While these transactions may relieve some pressure on the very heavy amount of debt coming due in the next fifteen months, Goodyear still faces the challenge of refinancing the $750 million senior secured U.S. revolver, $645 million senior secured U.S. term, and the $650 million senior secured European facilities which all mature in April 2005. In June 2005, approximately $467 million will come due with the maturity of a Euro note issue. Liquidity at Sept. 30, 2003 was provided by $1 billion of cash and equivalents and $254 million of availability under committed bank lines. While the nominal cash balance shown on the period end consolidated balance sheet are significant, nearly half of the amount was held in foreign operations which may impact the amount available for repatriation due to local operating needs, local laws, tax implications, and applicable credit facility agreements. In the near term, Goodyear will need substantial liquidity in its North American tire operations. Goodyear will have to make contributions of around $250-270 million for ERISA pension funding requirements. Another large cash consumption item will be working capital outlays in the first half of the year. Typically, Goodyear sees a significant rush of accounts receivable paydown before year-end closing which then builds up again through the first two calendar quarters. The working capital swing can be in the hundreds of millions. Also, the Entran II legal situation will require a cash contribution of $40 million in 2004 if the current settlement proposals hold. Cash usage associated with restructuring and/or rationalization charges should amount to more than $50 million. Operationally, concerns remain whether problems with North American Tire operations have yet been resolved. Market share for the flagship Goodyear brand continues to slip in the critical U.S. light vehicle replacement market, dropping a half a percentage point for both passenger cars and light trucks in 2003. Overall for Goodyear, share losses amounted to about 0.3% in 2003. Competitive pressures from Bridgestone and Michelin, both of whom gained market share during 2003 in the U.S. replacement market, are not expected to relent. In addition, cost pressures continue to mount in the area of raw materials. On-going healthcare cost and pension expense increases will also burden the cost structure. While the Huntsville plant closure and other productivity measures which resulted from the USWA union talks will help in improving asset utilization in North American tire operations, the overall picture is unclear if the productivity gains will be enough to allow North American tire operation to be profitable in the near future. GOODYEAR: S&P Lowers Rating on Series 2001-34 Class A-1 Notes to B ------------------------------------------------------------------ Standard & Poor's Ratings Services lowered its rating on the class A-1 certificates issued by the Corporate Backed Trust Certificates, Goodyear Tire & Rubber Co. Note-Backed Series 2001- 34 Trust to 'B' from 'B+'. The rating remains on CreditWatch with negative implications. The lowered rating follows the Feb. 11, 2004 lowering of the senior unsecured debt rating on Goodyear Tire & Rubber Co. CBTC 2001-34 is a swap-independent synthetic transaction that is weak-linked to the underlying securities, Goodyear Tire & Rubber Co.'s 7% notes due March 15 2028. The lowered rating reflects the current credit quality of the underlying securities. RATING LOWERED Corporate Backed Trust Certificates, Goodyear Tire & Rubber Co. Note-Backed Series 2001-34 Trust $46 million corporate backed trust certs series 2001-34 Rating Class To From A-1 B/Watch Neg B+/Watch Neg GSI GROUP: S&P Withdraws B- Credit Rating at Company's Request -------------------------------------------------------------- Standard & Poor's Ratings Services withdrew its ratings, including the 'B-' corporate credit rating, on GSI Group Inc. at the company's request. Assumption, Illinois-based GSI Group is a manufacturer and supplier of agricultural equipment. GSI is a manufacturer in niche agricultural equipment markets. Products include grain-handling and storage equipment, and swine- and poultry-raising equipment. GUESS? INC: Will Webcast Q4 Conference Call on February 19 ---------------------------------------------------------- Guess?, Inc. (NYSE: GES) will hold a webcast of its conference call on Thursday, February 19, 2004 at 4:30 pm (ET) to discuss the Company's financial results for the fourth quarter of 2003. A live webcast will be accessible at http://www.guess.com, via the "Investor's Info" link from the "Guess, Inc." section of the website. A replay of the conference will be archived on the website. Guess?, Inc. (S&P, BB- Corporate Credit Rating, Negative) designs, markets, distributes and licenses one of the world's leading lifestyle collections of contemporary apparel, accessories and related consumer products. HANOVER DIRECT: Director Martin L. Edelman Resigns From Board ------------------------------------------------------------- Hanover Direct, Inc. (Amex: HNV) announced the resignation of Martin L. Edelman from the Company's Board of Directors, effective February 15, 2004. "The Company and the Board express their deep appreciation and gratitude for Marty Edelman's service to the Company and its shareholders through the recent recapitalization," stated Tom Shull, Chairman, President and CEO of Hanover Direct, Inc. Hanover Direct, Inc. (Amex: HNV) and its business units provide quality, branded merchandise through a portfolio of catalogs and e-commerce platforms to consumers, as well as a comprehensive range of Internet, e-commerce, and fulfillment services to businesses. The Company's catalog and Internet portfolio of home fashions, apparel and gift brands include Domestications, The Company Store, Company Kids, Silhouettes, International Male, Scandia Down, and Gump's By Mail. The Company owns Gump's, a retail store based in San Francisco. Each brand can be accessed on the Internet individually by name. Keystone Internet Services, LLC -- http://www.keystoneinternet.com-- the Company's third party fulfillment operation, also provides the logistical, IT and fulfillment needs of the Company's catalogs and web sites. Information on Hanover Direct, including each of its subsidiaries, can be accessed on the Internet at http://www.hanoverdirect.com At September 27, 2003, Hanover Direct's balance sheet shows a total shareholders' equity deficit of about $79 million. HANOVER: Eliminates Executive Position for Strategic Realignment ---------------------------------------------------------------- Hanover Direct, Inc. announced that the Company eliminated the position of Executive Vice President, Finance & Administration, held by Brian C. Harriss on Friday, February 13, 2004. In conjunction with this downsizing, Charles Blue, Senior Vice President & Chief Financial Officer, will assume the additional role of Company Secretary. "I want to thank Brian," said Tom Shull, Hanover Direct's Chairman, President and Chief Executive Officer, "for his many contributions to the Company's strategic business realignment program over the past three years in a variety of executive roles and wish him well in his future endeavors." Hanover Direct, Inc. (Amex: HNV) and its business units provide quality, branded merchandise through a portfolio of catalogs and e-commerce platforms to consumers, as well as a comprehensive range of Internet, e-commerce, and fulfillment services to businesses. The Company's catalog and Internet portfolio of home fashions, apparel and gift brands include Domestications, The Company Store, Company Kids, Silhouettes, International Male, Scandia Down, and Gump's By Mail. The Company owns Gump's, a retail store based in San Francisco. Each brand can be accessed on the Internet individually by name. Keystone Internet Services, LLC -- http://www.keystoneinternet.com-- the Company's third party fulfillment operation, also provides the logistical, IT and fulfillment needs of the Company's catalogs and web sites. Information on Hanover Direct, including each of its subsidiaries, can be accessed on the Internet at http://www.hanoverdirect.com At September 27, 2003, Hanover Direct's balance sheet shows a total shareholders' equity deficit of about $79 million. HAWK CORP: Hosting Q4 2003 Conference Call on the Web Today ----------------------------------------------------------- In conjunction with Hawk Corporation's (NYSE: HWK) fourth quarter and full year 2003 earnings release, you are invited to listen to its conference call that will be broadcast live over the Internet on Tuesday, February 17, 2004 at 10:00 a.m. Eastern with the management of Hawk Corporation. What: Hawk Corporation Fourth Quarter and Full Year 2003 Earnings Release When: Tuesday, February 17, 2004 @ 10:00 a.m. Eastern Where: http://www.firstcallevents.com/service/ajwz399874241gf12.html How: Live over the Internet - Simply log on to the web at the address above Contact: Thomas A. Gilbride, Vice President - Finance, 216.861.3559. If you are unable to participate during the live webcast, the call will be archived later in the afternoon on the Company's site http://www.Hawkcorp.com. To access the call, click on News & Reports-News-Conference Calls & Presentations. Hawk Corporation -- whose Corporate Credit Rating has been upgraded by Standard & Poor's to 'single-B' -- is a leading worldwide supplier of highly engineered products. Its friction products group is a leading supplier of friction materials for brakes, clutches and transmissions used in airplanes, trucks, construction equipment, farm equipment and recreational vehicles. Through its precision components group, the Company is a leading supplier of powder metal and metal injected molded components for industrial applications, including pump, motor and transmission elements, gears, pistons and anti-lock sensor rings. The Company's performance automotive group manufactures clutches and gearboxes for motorsport applications and performance automotive markets. The Company's motor group designs and manufactures die- cast aluminum rotors for fractional and subfractional electric motors used in appliances, business equipment and HVAC systems. Headquartered in Cleveland, Ohio, Hawk has approximately 1,700 employees and 16 manufacturing sites in five countries. Hawk Corporation is online at http://www.hawkcorp.com/ INSCI CORP: Stockholders' Deficit Tops $1,165,000 as of Dec 2003 ---------------------------------------------------------------- INSCI Corp. (OTC Bulletin Board: INCC), a leading provider of enterprise content management (ECM) solutions, announced financial results for its fiscal 2004 third quarter and nine months ended December 31, 2003. Results for the fiscal 2004 third quarter reflected the impact of the strategic acquisition of the assets of WebWare, a Sausalito, CA-based provider of award-winning digital asset management (DAM) solutions. "WebWare has provided INSCI with a platform for expansion in the enterprise content management (ECM) market," said President and CEO Henry F. Nelson. "With this acquisition, INSCI has gained a broader suite of technology, premier customers and new market opportunities, a move we believe will prove to be an important investment in our future growth." Total revenues for the third quarter of fiscal 2004 were $2.2 million, compared to total revenues of $2.5 million for the third quarter of fiscal 2003. Product revenues for the third quarter of fiscal 2004 were $603,000 compared to $1.2 million for the prior year period, and service revenues were at $1.6 million, up from $1.3 million in the year earlier period. Operating loss for the third quarter of fiscal 2004 was $1.1 million, compared to operating income in the prior fiscal year quarter of $601,000. The net loss for the third quarter of fiscal 2004 was $1.3 million, or a loss per share of $0.23, compared to net income of $446,000, or $0.09 per basic share and $0.05 per diluted share in the third quarter of last fiscal year. Also, INSCI Corp.'s December 31, 2003 balance sheet shows a working capital deficit of $2,285,000 and a total stockholders' deficit of $1,165,000. "While we are disappointed with our financial performance for the fiscal year 2004 third quarter, we have undertaken a number of initiatives toward future growth. In addition to revitalizing our core business, our strategy includes capitalizing on our quality base of customers and leveraging the many new market and product opportunities brought to us by the acquisition," said Nelson. "Within the third quarter of fiscal 2004, we also made substantial progress in integrating WebWare, which should allow us to generate a number of cost efficiencies within the Company." For the first nine months of fiscal 2004, revenues were $6.1 million, compared to total revenues of $7.1 million for the same period last fiscal year. Product revenues for the fiscal 2004 nine months were $2.2 million, compared to $3.0 million for the first nine months of 2003, and service revenues were $3.9 million, compared to $4.1 for the first nine months of fiscal 2003. Operating loss for the first nine months of fiscal 2004 was $1.9 million, compared to operating income in the prior fiscal year period of $1.4 million. The net loss for this fiscal year's first nine months was $2.2 million, or a loss per share of $0.43, compared to net income of $1.2 million, or $0.22 per basic share and $0.13 per diluted share in the same period last fiscal year. Results for the first nine months of 2004 included non-recurring restructuring expenses of $380,000, incurred as part of a plan to realign operations of the Company's acquisition of the assets of WebWare in September 2003. Results for the first nine months of 2003 included the effects of a $192,000 extraordinary gain from the extinguishment of debt recorded in the second quarter of that fiscal year. The number of basic and diluted shares outstanding and the per share amounts for all periods have been adjusted to reflect the effect of the 1 for 10 reverse split of the Company's outstanding shares of common stock that was effective on January 2 of this year. Given the market acceptance of the hosted model for the ActiveMedia product, INSCI intends to leverage this hosting infrastructure with a similar solution offering for its ESP+ product suite. Through this subscription-based model, INSCI expects to gain an expanded and predictable platform for recurring revenues. During the third quarter, the Company announced major new initiatives to support its growing presence in Europe, including the naming of Bob Harte, a long-term INSCI sales contributor and industry veteran, to the newly created position of Vice President, International Sales, additional VAR support and expanded product lines. INSCI also announced during the quarter that its WebWare Product Group received the 2003 Frost & Sullivan Customer Value Enhancement Award; the signing of a strategic partnership with Biscom, Inc., a major supplier of network FAX systems; and the release of ActiveMediaTM 5.0, the newest addition of the Company's DAM solution. Subsequent to the quarter end, INSCI completed a private placement of Series C Preferred Stock raising $500,000 in gross proceeds; ActiveMedia 5.0 was honored with the 2004 Frost & Sullivan Product of the Year award for Digital Asset Management; and TranTech, a leading systems integration and IT services provider to the federal government, selected ActiveMedia as its key software application platform for rich media solutions. INSCI Corp. (OTC Bulletin Board: INCC) is a leading provider of solutions for the enterprise content management (ECM) market. INSCI's technology provides a strong foundation for managing the full spectrum of enterprise content, from documents to e-mail, and graphics to video. INSCI's fixed content and digital asset management (DAM) systems are empowering world- leading companies to enhance their bottom line, meet regulatory compliance requirements, improve customer service, global marketing, media syndication, and cross-media publishing. For more information about INSCI, visit www.insci.com ITC DELTACOM: 2004 Annual Shareholders' Meeting Slated for Apr. 27 ------------------------------------------------------------------ On January 27, 2004, the Board of Directors of ITC DeltaCom, Inc. approved April 27, 2004, as the date of the 2004 annual meeting of the Company's stockholders. The Company must receive any stockholder proposals intended for inclusion in the Company's proxy statement and form of proxy relating to the 2004 annual meeting of stockholders by 5:00 p.m. (EST) on March 1, 2004. ITC Delatacom, Inc., an exempt telecommunications company and a holding company, filed for chapter 11 protection on June 25, 2002. Rebecca L. Booth, Esq., Mark D. Collins, Esq. at Richards, Layton & Finger, P.A. and Martin N. Flics, Esq., Roland Young, Esq. at Latham & Watkins represent the Debtors in their restructuring efforts. When the Company filed for protection from its creditors, it listed $444,891,574 in total assets and $532,381,977 in total debts. JO-ANN STORES: S&P Assigns B- Rating to $100MM Senior Sub. Notes ---------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B-' rating to Jo- Ann Stores Inc.'s proposed $100 million senior subordinated note offering due 2012. The notes will be issued under Rule 144A with registration rights. The proceeds will be used to repurchase $64 million of 10.375% senior subordinated notes due 2007, as well as for general corporate purposes. At the same time, Standard & Poor's revised its ratings outlook on Jo-Ann to positive from stable due to the company's stabilized operating performance and declining leverage. Outstanding ratings on the company, including the 'B+' corporate credit rating, were affirmed. "The ratings on Jo-Ann Stores reflect the risks associated with the company's participation in the competitive and fragmented craft and hobby industry, its store conversion strategy, and its growth strategy," said Standard & Poor's credit analyst Robert Lichtenstein. "These risks are somewhat mitigated by the company's established national brand, leading market position in fabrics, and solid credit measures for the rating." The company maintains a leading market position in the fabric segment of the hobby industry, but trails Michaels Stores Inc. in the crafts segment. Management's strategy is to reposition the company into a fabric and craft retailer from a predominantly fabric retailer through the expansion of its Jo-Ann etc superstore format, because of better growth prospects for the crafts industry. However, it faces the challenges of competing with crafts industry leader Michaels and managing a higher degree of seasonal inventory. Operating performance has stabilized because of better inventory management, benefits from the company's turn-around plan, and a trend toward home-based activities. Same-store sales increased 3.6% in 2003, following a 8.4% rise in all of 2002; however, operating margins for the 12 months ended Nov. 1, 2003, declined to 14.5%, from 15.2% the year before. The decrease is attributable to more clearance sales in the first half of the year and higher advertising, distribution, and pre-opening costs. KMART HOLDING: Files Suit Against Martha Stewart Over Contract -------------------------------------------------------------- Kmart Holding Corporation (Nasdaq: KMRT) confirmed that it filed an action against Martha Stewart Living Omnimedia ("MSO") with the United States Bankruptcy Court for the Northern District of Illinois, Eastern Division on February 11, 2004. Kmart is seeking declaratory and other relief under the June 2001 contract, as assumed, between Kmart and MSO IP Holdings, Inc. ("MSO IP"), a wholly owned subsidiary of MSO. According to Martha Stewart's news release, this contract provides for two types of guaranteed royalty payment: the first based upon aggregate sales of all licensed products; and the second based upon sales by individual product categories. Kmart now seeks to interpret the agreement in a manner that would require them to make minimum royalty payments for the remaining life of the contract based solely upon aggregate sales of licensed products. As a result, Kmart specifically seeks to reduce the total guarantees due to MSO IP for the 12 months ended January 31, 2004, from approximately $52.0 million to $47.5 million, or approximately $4.5 million. In addition, Kmart seeks to reduce by approximately $1 to $2 million annually the amount it is obligated under the contract to spend with MSO on advertising in MSO media properties. MSO believes that Kmart's interpretation is inconsistent with the terms of its long-standing contract, and therefore intends to defend this action and enforce the terms of the contract. Kmart believes that MSO's news release does not accurately reflect Kmart's position as set forth in the complaint. In particular, Kmart is not, at this time, seeking to reduce the total guarantees or the required advertising levels, but rather it is MSO which is seeking to force Kmart to make payments in excess of the contractual requirement, which payments would represent an impermissible double-counting. MSO's interpretation is inconsistent with the basis on which the contract was assumed in bankruptcy. Further, Kmart is seeking to clarify the amount that Kmart is required to spend on MSO media properties consistent with the plain language of the document and the referenced actual spend in 2001. Kmart has repeatedly but unsuccessfully attempted to resolve this issue through negotiation since last fall. Kmart was left with no choice, in light of its need to plan its business and the fact that the next royalty payment under the contract is due on February 28, but to commence the action. Kmart continues to value its relationship with MSO and sincerely hopes for a prompt conclusion to this matter. Kmart Holding Corporation (Nasdaq: KMRT) and its subsidiaries is a mass merchandising company that offers customers quality products through a portfolio of exclusive brands that include THALIA SODI, DISNEY, JACLYN SMITH, JOE BOXER, KATHY IRELAND, MARTHA STEWART EVERYDAY, ROUTE 66 and SESAME STREET. Kmart operates more than 1,500 stores in 49 states and is one of the 10 largest employers in the country with approximately 158,000 associates. For more information visit the Company's website at http://www.kmart.com/ Martha Stewart Living Omnimedia, Inc. (MSO) is a leading provider of original how-to information that turns dreamers into doers, inspiring and engaging consumers with unique content and high- quality products for the home. MSO's creative experts develop content within eight core areas -- Home, Cooking and Entertaining, Gardening, Crafts, Holiday, Keeping, Weddings, and Baby and Kids - - that provide consumers with ideas and products to celebrate their homes and the domestic arts. MSO is organized into four business segments -- Publishing, Television, Merchandising and Internet/Direct Commerce. LEGEND INT'L: Brings-In Clyde Bailey as New Independent Auditor --------------------------------------------------------------- On January 26, 2004, Legend International Holdings, Inc. was informed by its certifying accountant, Stan J.H. Lee, C.P.A., that the certifying accountant had not registered with the Public Company Accounting Oversight Board (PCAOB) and was discontinuing its SEC practice. Effective February 3, 2004, the Company dismissed Stan Lee as its independent certified public accountants as a result of Stan Lee's decision not to register with the PCAOB as required. For each of the past two years the certifying accountant's report on Legend's financial statements was modified as to an uncertainty. The uncertainty in each of the two years was a substantial doubt about the Company's ability to continue as a going concern. Legend's Board of Directors has approved the change in certifying accountants. On February 3, 2004, Clyde Bailey P.C., Certified Public Accountants, of San Antonio, Texas was appointed as Legend's new certifying accountant. LTV: Gets Permission to Settle Allocation Appeals and Disputes -------------------------------------------------------------- The Official Committee of Administrative Claimants and LTV Steel Company, Inc., sought and obtained Judge Bodoh's permission to enter into a multiparty settlement agreement that resolves: (i) appeals related to the wind down of the LTV Steel bankruptcy case; (ii) all of the appeals of the Order allocating the proceeds of the sale of LTV Steel to ISG related to LTV Steel's former Indiana Harbor facilities; and (iii) prospective litigation over the Lake County, Indiana Administrative Tax Claim. The Prospective Lake County Dispute Lake County asserts $23,750,000 in administrative claims against the Debtors' estates. The Debtors dispute the validity and amount of the claims. The Settlement Agreement reduces, fixes and allows Lake County's administrative tax claim, without the need for the commencement of litigation, and permits settlement of the appeals. The Settlement Pursuant to the Settlement Agreement, Lake County, Appellants JWP/Hyre, Hunter, Calumet, Didier, Hasse, and Foster, the ACC and LTV Steel agree that: (1) The Settling Appellants will dismiss, with prejudice their appeals. (2) In exchange for the Settling Appellants' dismissals, Lake County's administrative claim for taxes will be fixed and allowed for $8,100,000 against the LTV Steel estate. Lake County's allowed administrative claim will be paid or otherwise satisfied in accordance with the treatment accorded to other allowed administrative claims in the LTV Steel case. Lake County will have no other administrative or priority claim of any kind in any of the Debtors' bankruptcy cases. (3) Lake County will receive $250,000 cash on account of its first-priority lien on real property at Debtors' former Indiana Harbor facility. The $250,000 represents the settlement amount of Lake County's lien on the Indiana Harbor real property. The $250,000 allocation will reduce the amount allocable to the Hennepin Works under the Allocation Order. The allocation will not otherwise modify in any manner the allocation set forth in the Allocation Order for any of the other property sold in the ISG Sale. (4) The Settling Appellants will enter into a separate agreement -- to which neither the Debtors nor the ACC are parties -- that: (i) allocates the initial $250,000 payment on account of Lake County's first priority lien on the Debtors' former Indiana Harbor facility's real property among themselves, as the Settling Appellants see fit; (ii) provides that Lake County will receive and retain the first $2,500,000 in cash that is to be distributed on account of its allowed administrative claim [Lake County's portion of the $250,000 initial payment will be included in the $2,500,000 for purposes of determining the overall amounts to be retained by Lake County]; and (iii) Lake County's retained portion of the distributions on account of its allowed administrative claim and the Allocation Payment will be capped at $2,500,000, and it will retain no further portion of the distributions on account of its allowed administrative claim and the Allocation Payment. The remaining amounts to be distributed on account of Lake County's allowed administrative claim and the Allocation Payment will be redistributed by Lake County to the other Settling Appellants pursuant to the terms of their independent Inter-Appellant Agreement. (5) All amounts to be distributed to the Settling Appellants pursuant to the Settlement Agreement and Inter-Appellant Agreement will be in addition to the amounts to be distributed on account of the Settling Appellants' allowed administrative claims in LTV Steel's Chapter 11 case pursuant to any separate plan or motion to distribute estate assets that is approved by the Court. However, the total amount to be distributed to the Settling Appellants on account of Lake County's allowed administrative claim and the $250,000 Allocation Payment on account of Lake County's first-priority lien will not exceed a combined total of $4,300,000. Any amounts that would otherwise be distributable to the Settling Appellants on account of Lake County's allowed administrative claim and its first priority lien claim -- that is, the Allocation Payment -- pursuant to the Term Sheet and which would exceed the $4,300,000 maximum distribution amount on such claims will not be distributed to the Settling Appellants by the LTV Steel Estate. Those excess amounts will, instead, remain in the LTV Steel Estate and will be distributed to administrative claimants other than the Settling Appellants. (6) The Settling Appellants will release all claims against all of the Debtors, other than: (a) the previously allowed administrative claims and the payments to be made with respect to the administrative claims; (b) the Lake County administrative claim; and (c) the Allocation Payment to be made pursuant to the Settlement. Headquartered in Cleveland, Ohio, The LTV Corporation is a manufacturer with interests in steel and steel-related businesses, employing some 17,650 workers and operating 53 plants in Europe and the Americas. The Company filed for chapter 11 protection on December 29, 2000 (Bankr. N.D. Ohio, Case No. 00-43866). Richard M. Cieri, Esq., and David G. Heiman, Esq., at Jones, Day, Reavis & Pogue, represent the Debtors in their restructuring efforts. On August 31, 2001, the Company listed $4,853,100,000 in assets and $4,823,200,000 in liabilities. (LTV Bankruptcy News, Issue No. 60; Bankruptcy Creditors' Service, Inc., 215/945-7000) LTX CORP: S&P Revises Outlook to Stable Following Equity Pricing ---------------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'B' corporate credit rating and its 'CCC+' subordinated debt rating on LTX Corp. At the same time, Standard & Poor's revised the company's outlook to stable from negative following LTX' announcement it has priced a public offering of 7 million common shares that will generate about $115 million in proceeds. Cash balances, pro forma for the equity issuance, are expected to increase to about $245 million as of January 2004. "Furthermore, in the January 2004 quarter, sales increased materially over the previous year's period and LTX produced positive cash flow for the first time since 2000. Recovery in the company's markets is expected to continue over the near to intermediate term," said Standard & Poor's credit analyst Emile Courtney. The ratings on Westwood, Massachusetts-based LTX Corp. reflect very volatile sales levels, high debt levels, substantial customer concentration and a narrow product line. These are only partially offset by the company's adequate cash balances and good technology. LTX supplies semiconductor automated test equipment to semiconductor manufacturers. The company's Fusion tester, its key product platform, incorporates leading-edge capabilities, testing multiple signal types for system-on-a-chip designs. Historically, the ATE market represents only a fraction of overall semiconductor spending and remains a highly volatile segment of the semiconductor capital equipment market. LTX's top five customers represented 85% of its sales in the October 2003 quarter. MEDISOLUTION LTD: December Working Capital Deficit Tops $12 Mill. ---------------------------------------------------------------- MediSolution Ltd. (TSX: MSH), a leading Canadian healthcare information technology company, announced its third quarter results for the three-month period ended December 31, 2003. Performance Highlights During the third quarter of 2003, MediSolution improved its performance across its key financial measures, including Revenue, EBITDA(i) and Net Income. In particular, MediSolution achieved its first quarterly profit since 2001. Outlined below are the third quarter highlights for 2003. Revenue Revenue for the quarter ended December 31, 2003 increased 20% over the same period last year to $14.4 million. On a segmented basis, revenues from: - Healthcare Information Systems increased by $3.6 million to $8.5 million principally from the completed implementations under the contract for the company's blood transfusion and traceability software, Trace Line. Revenues were also stronger due to implementations of radiology software systems - Healthcare Resource Management decreased by $0.9 million to $5.9 million due to fewer implementations of financial applications systems compared to the prior year. "We are pleased about the return to profitability of the Company," said Allan D. Lin, President and Chief Executive Officer, MediSolution. "MediSolution is performing well and our customers are responding to the value that our solutions deliver. The strong revenue growth during this quarter keeps us on track to achieve our target of 10% revenue growth for the year." EBITDA The Company achieved EBITDA of $1.8 million during the quarter compared to EBITDA of $0.5 million reported in the prior year. This improvement is due to the increase in revenue and improvement in margins on operations. Gross margins increased to 42% in the current quarter compared to 38% last year, as the Company operates with a leaner operations team with lower direct labour costs. However, these improved margins were somewhat offset by higher selling and marketing expenses that reflect an expanded U.S. sales team and additional marketing resources to develop new sales opportunities. Net Income Through revenue improvements and cost reductions, MediSolution achieved a profit of $0.4 million in the third quarter ended December 31, 2003 compared to a loss of $1.2 million reported in the prior year. Third Quarter Initiatives and Highlights During the quarter, MediSolution undertook a number of initiatives to create value for shareholders, strengthen its balance sheet and position the Company for further growth. New Contracts MediSolution signed a total of $4.2 million in new business, including contracts with the following customers: - University of Louisiana (USA) for MediLab(R), an automated laboratory information system; - Centre hospitalier regional de Trois-Rivieres, Trois-Rivieres (Quebec) for MediFinance(R), a financial and materials management information system; - Hopital Ste-Croix, Drummondville (Quebec) for MediFinance(R); - Quebec Region (Quebec) for MediLab(R) ; - Regie regionale Mauricie (Quebec) for MediResult(R), integrated clinical information management software package. The revenue on these contracts is expected to be recognized over the next twelve to eighteen months. Strengthened Financial Position On October 10, 2003 the company issued 54,309,344 common shares to Brascan Financial Corporation pursuant to the early conversion of Brascan's $14.5 million long term debt. Consequently, MediSolution is in a stronger financial position with increased permanent equity and total debt of only $4.5 million at December 31, 2003. Year to Date Results Year to date, MediSolution increased its revenue by 10% to $36.2 million from $32.8 million in the prior year. EBITDA increased over 200% to $2.7 million this year from $0.8 million in the nine months ending December 31, 2002. In addition, MediSolution reduced its net loss from $5.0 million last year to $1.8 million in the nine months ending December 31, 2003. Outlook We continue to believe that we are on target to achieve our financial goals and business objectives for the year. MediSolution Ltd.'s December 31, 2003, balance sheet reports a working capital deficit of about $12 million. MediSolution is a leading healthcare information technology company, providing software, solutions and services to healthcare customers across North America. More than 500 hospitals, home care facilities and other healthcare providers rely on MediSolution's systems to maximize their operational efficiencies, lower their costs, and improve the delivery of healthcare services. MediSolution has two operating segments. The Healthcare Resource Management segment is comprised of administrative solutions such as human resource, staff scheduling, payroll processing and financial software. The Healthcare Information Systems segment is comprised of clinical solutions such as patient tracking, electronic patient health records, radiology, pharmacy and laboratory software for hospitals. MediSolution is publicly traded (TSX: MSH), and has a staff of approximately 335 who operate from the Company's Montreal, Quebec headquarters and offices throughout Canada and the United States. For more information, visit http://www.medisolution.com/. MERITAGE: S&P Raises Corporate & Sr. Unsecured Note Ratings to BB- ------------------------------------------------------------------ Standard & Poor's Ratings Services raised its corporate credit rating on Meritage Corp., as well as the ratings on $288 million of senior unsecured notes, to 'BB-' from 'B+'. The outlook has been revised to stable. "The upgrades acknowledge the successful integration of a series of relatively modest acquisitions that have materially broadened this mid-sized homebuilder's operating platform. Meritage has grown homebuilding revenues nearly threefold since fiscal year 2000, while maintaining solid inventory turns, profit margins, and return measures. Importantly, Meritage has profitably executed its growth strategy while preserving a conservative financial profile as evidenced by moderate debt levels and strong coverage measures," said Standard & Poor's credit analyst Jim Fielding. The company's solid profit margins and higher inventory turns should ensure solid cash flow over the longer-term. Additionally, the company's willingness to invest in the corporate-level infrastructure and division-level talent necessary to manage a rapidly growing and increasingly diverse business should enable Meritage to adapt quickly to changing market conditions and allow senior management to continue allocating capital efficiently. Scottsdale, Arizona-based Meritage has been one of the nation's fastest growing homebuilders with both homebuilding revenues and net earnings rising at a compound annual rate of approximately 40.0% since 2000. MILLBROOK PRESS: Has Until March 12 to Complete Schedules --------------------------------------------------------- The U.S. Bankruptcy Court for the District of Connecticut, Bridgeport Division, gave The Millbrook Press, Inc. an extension to file its schedules of assets and liabilities, statements of financial affairs and lists of executory contracts and unexpired leases required under 11 U.S.C. Sec. 521(1). The Debtor has until March 12, 2004 to file their Schedules of Assets and Liabilities and Statement of Financial Affairs. Headquartered in Brookfield, Connecticut, Millbrook Press, Inc. -- http://www.millbrookpress.com/-- is a publishing children's non- fiction books in hardcover and paperback for schools, libraries and consumer markets. The Company filed for chapter 11 protection on February 6, 2004 (Bankr. Conn. Case No. 04-50145). Jed Horwitt, Esq., at Zeisler and Zeisler represents the Debtor in its restructuring efforts. When the Company filed for protection from its creditors, it listed $8,000,000 in total assets and $9,000,000 in total debts. MIRANT: Seeks Nod to Make Initial KERP Payments to Key Employees ---------------------------------------------------------------- Ian T. Peck, Esq., at Haynes and Boone LLP, in Dallas, Texas, recalls that on January 14, 2004, the Court held a hearing to consider the Mirant Corp. Debtors' proposed Key Employee Retention Program. The Court ruled that while the first payment of Stay Bonuses will vest on June 30, 2004, the Debtors may not actually pay these bonuses until October 1, 2004. The Court also instructed the Debtors to deposit $8,000,000 into a segregated, interest-bearing account, which will serve as a holding account for the payment of bonuses pursuant to the KERP. The Court reserved judgment on additional payment dates, which will not be established until after May 1, 2004. In addition, the Court asked the Debtors to wait until after May 1, 2004 to seek the authority to implement Phase II of the KERP to allow sufficient time for the development and implementation of the new business plan. On January 21, 2004, the Court held a status conference. During the status conference, the Debtors informed the Court of their concerns that approval of the KERP with the Delayed Payments would not have the same retentive effect that implementation of the KERP was designed to achieve. The Debtors asked the Court to consider authorizing them to make the first KERP payment in June. The Court instructed the Debtors to make a formal request. Mr. Peck explains that when designing the KERP, the Debtors considered that payment of retention bonuses at strategic times would achieve an overall retention effect. The Debtors believe that the June payment has particular strategic importance because it coincides approximately with a date that is one year after the Petition Date. Payment of a modest bonus upon completion of one full year of operating in Chapter 11 will demonstrate to key employees that the Debtors recognize the hard work and dedication displayed by these employees over an extended time and through a difficult process. Delaying actual receipt of the initial KERP payment means practically that the Debtors will not have paid any special incentive compensation relating to this reorganization to key employees through the entire first full year of these Chapter 11 cases. The Debtors are concerned that the failure to make actual payment of any incentive compensation through the first full year in Chapter 11 will have a dilutive, retentive and potentially demoralizing effect. Furthermore, Mr. Peck points out that notwithstanding the vesting of the initial KERP payments in June, by delaying actual payment until October, key employees will consider the likelihood of receiving the initial payments to be highly uncertain. Perhaps more importantly, employees do not possess the same understanding and appreciation of the bankruptcy process that bankruptcy practitioners often take for granted and, through further perceived uncertainty caused by delaying the initial KERP payment, employees will view the likelihood of receiving any future KERP payments not yet approved by the Court with a great deal of skepticism. The Debtors believe that, if permitted to make the initial KERP payments in June, the certainty of receiving payments at this time will not only increase morale over the short term but will also remove substantial doubts that key employees may have with respect to future KERP payments not yet approved by the Court. The Debtors believe that increasing the certainty of receiving the near term payments as well as decreasing skepticism with respect to receiving future payments collectively will have a much greater retentive effect than delaying receipt of the initial June payments until October. Accordingly, the Debtors ask the Court to permit them to make actual payments as early as June 30, 2004, of the initial KERP payments to key employees. (Mirant Bankruptcy News, Issue No. 23; Bankruptcy Creditors' Service, Inc., 215/945-7000) MORGAN STANLEY: Fitch Raises & Affirms Ratings on 1997-C1 Notes --------------------------------------------------------------- Fitch Ratings upgrades Morgan Stanley Capital's commercial mortgage pass-through certificates, series 1997-C1 as follows: -- $38.4 million class C to 'AAA' from 'AA+'; -- $35.2 million class D to 'AA' from 'A'; -- $19.2 million class F to 'BBB+' from 'BB+'; -- $11.2 million class G to 'BBB' from 'BB'; -- $20.8 million class H to 'B+' from 'B'. In addition, Fitch affirms the following certificates: -- $138.3 million class A-1C 'AAA'; -- Interest only class IO-1 'AAA'; -- $51.3 million class B 'AAA'. Fitch does not rate classes E or J and classes A-1A and A-1B have paid in full. The upgrades are primarily the result of increased subordination levels due to loan payoffs and amortization. As of the January 2004 distribution date, the pool's collateral balance has been reduced by 47%, to $341.4 million from $640.7 million at issuance. One loan (1.9%) is currently being specially serviced. The loan is real estate owned and secured by an office property located in Dallas, Texas. The property is currently listed for sale. Fitch is also concerned with the increasing concentrations of healthcare, hotel and self storage (23.5%, 5.0%, and 11.2% respectively). However, these loans continue to perform and Fitch analyzed the concentrations in the context of the entire pool. Given the increased credit enhancement and the lack of significant expected losses or loans of concern, the upgrades are warranted. MORGAN STANLEY: Fitch Affirms Low-B Level Rating on Class F Notes ----------------------------------------------------------------- Fitch Ratings upgrades Morgan Stanley Capital Inc.'s commercial mortgage pass-through certificates, series 1996-C1, as follows: -- $17.0 million class D-1 to 'AAA' from 'AA'; -- $5.1 million class D-2 to 'AA' from 'AA-'; -- $18.7 million class E to 'BBB' from 'BB+'. The following classes are affirmed: -- $59.4 million class A 'AAA'; -- $20.4 million class B 'AAA'; -- $18.7 million class C 'AAA'; -- Interest only class X 'AAA'; -- $13.6 million class F to 'B'; Fitch does not rate the $5.4 million class G. The rating upgrades are a result of increased subordination levels and the low number of loans of concern since issuance. As of the January 2004 distribution date, the pool's certificate balance has paid down 53.5% to $158.5 million from $340.5 million at issuance. Currently there are two loans, representing 3.4% of the pool, in special servicing. The larger loan (2.6%) is secured by a 383 pad manufactured housing community located in Stillwater, New York. The loan transferred to the special servicer in May 2002 due to delinquency. The special servicer is currently working with the borrower to determine a workout plan. The second loan (0.8%) transferred due to a non-monetary default. MTS INC: Asks Court to Extend Lease Decision Time through June 30 ----------------------------------------------------------------- MTS Incorporated and its debtor-affiliates want the U.S. Bankruptcy Court for the District of Delaware to give them more time to assume, assume and assign, or reject their unexpired nonresidential real property leases. Currently, the Debtors report to have over 100 Real Property Leases. The Debtors point out that the sole purpose behind the commencement of these bankruptcy proceeding is to allow the Debtors to confirm and effect their Prepackaged Plan of Reorganization -- a plan that has been overwhelmingly accepted by the impaired creditor class. In these cases, the lease decision period expires on March 22, 2004, or approximately the same week the Debtors requested the Court to hold the hearing approving the Plan. The creditors accepted of the Plan, nonetheless, they are asking for more time in their lease related decisions out of an abundance of caution to ensure that no Real Property Leases that would be assumed under the Plan are inadvertently deemed rejected prior to its effectiveness. Additionally, given the compressed time frame apparent in these bankruptcy cases, the Debtors submit that it would be imprudent to require the Debtors to elect whether to assume or reject the Real Property Leases within the original 60-day specified period. Consequently, the Debtors ask the Court to give them until June 30, 2004 to decide whether to assume, assume and assign, or reject their unexpired nonresidential real property leases. Headquartered in West Sacramento, California, MTS, Incorporated -- http://www.towerrecords.com/-- is the owner of Tower Records and is one ofthe largest specialty retailers of music in the US, with nearly 100 company-owned music, book, and video stores. The Company, together with its debtor-affiliates, filed for chapter 11 protection on February 9, 2004 (Bankr. Del. Case No. 04-10394). Mark D. Collins, Esq., and Michael Joseph Merchant, Esq., at Richards Layton & Finger represent the Debtors in their restructuring efforts. When the Company filed for protection from its creditors, it listed its estimated debts of over $10 million and estimated debts of over $50 million. NEW JERSEY MINING: Board Installs DeCoria Maichel as New Auditor ---------------------------------------------------------------- Effective December 10, 2003, the Board of Directors of New Jersey Mining Company, recommended and directed: (a) The dismissal of Nathan Wendt, CPA as the Company's independent accountant and the engagement of DeCoria, Maichel & Teague P.S. as the Company's independent accountants to audit the Company's financial statements for the year ending December 31, 2003. The report of Wendt on the Company's financial statements for the past two years were modified as to the uncertainty of the Company's ability to continue as a going concern. NORAMPAC INC: Sells Corrugated Product Plant in Monterrey, Mexico ----------------------------------------------------------------- Norampac Inc. announces the sale of its corrugated product plant in Monterrey, Mexico, known under the name of Norampac Monterrey Division S.A. de C.V. The plant, which started up in 2001, was sold to its current management team. In 2003, the plant's total net sales represented only 0.5% of Norampac's total net sales of corrugated products. Norampac (S&P, BB+ Long-Term Corporate Credit Rating, Stable Outlook) owns eight containerboard mills and twenty-four corrugated products plants in the United States, Canada and France. With an annual production capacity of more than 1.6 million short tons, Norampac is the largest containerboard producer in Canada and the seventh largest in North America. Norampac, which is also a major Canadian manufacturer of corrugated products, is a joint venture company owned by Domtar Inc. (symbol: DTC-TSE) and Cascades Inc. (symbol: CAS-TSE). NUEVO ENERGY: Fitch Places Low-B Debt Ratings on Watch Positive --------------------------------------------------------------- Fitch Ratings has placed the debt ratings of Nuevo Energy on Watch Positive following the announcement that Plains Exploration & Production Company will acquire Nuevo. Currently, Fitch rates Nuevo's senior subordinated debt 'B' and its trust convertible securities 'B-'. Plains anticipates issuing 37.4 million shares to Nuevo shareholders and assuming $234 million of net debt and $115 million of Trust Convertible Securities. The transaction is expected to close in the second quarter of 2004. The rationale for the Watch Positive includes the size of the new entity, which will approach 489 million barrels of oil equivalent from Nuevo's current size of just over 200 million barrels. Proved developed reserves will represent more than 70% of the total and 83% of the total will be oil. Additionally, the new entity will have more exploitation opportunities than existed for Nuevo on a stand-alone basis. As a result, organic growth should be higher for the new entity. Furthermore, Plains management has stated that costs per unit of production should decline. Free cash flow will likely be applied towards reducing debt thereby lowering interest costs and personnel reductions should decrease general and administrative expenses per unit. Fitch Ratings expects to resolve the Watch Positive following further analysis of Plains' credit profile and operations and upon completion of the transaction. Nuevo Energy, a Houston, Texas based company is primarily engaged in the exploration and production of oil and natural gas. Subsequent to the sale of its Brea Olinda properties in March 2003, its reserves were 217 million barrels of oil equivalent, 88% oil, 90% proved developed, had a reserve life of over 11 years and were based primarily in California (87%). OHIO CASUALTY: Outlook on S&P's Ratings Revised to Stable --------------------------------------------------------- Standard & Poor's Ratings Services revised its outlook on American Fire & Casualty Co., Ohio Casualty Insurance Co., Ohio Security Insurance Co., and West American Insurance Co., which make up the Ohio Casualty Insurance Co. Intercompany Pool, to stable from negative. Standard & Poor's also said that it revised its outlook on Ohio Casualty Corp. (NASDAQ:OCAS), OCIP's parent holding company, to stable from negative. At the same time, Standard & Poor's affirmed its 'BBB' counterparty credit and financial strength ratings on OCIP and its 'BB' counterparty credit rating on Ohio Casualty. "The revised outlook reflects Ohio Casualty's improving capitalization, decreasing expense ratio, and improving operating performance," said Standard & Poor's credit analyst Donovan Fraser. Standard & Poor's expects that management will continue to make steady progress toward underwriting profitability. Under the leadership of a new management team in 2001, OCIP initiated a new strategic plan to address unprofitable segments-- particularly in personal lines--and re-underwrite the group's book of business. Though execution risk accompanies any significant paradigm shift within a large organization, Standard & Poor's considers the company's approach to be a measured, conservative, long-term road map to underwriting profitability. The company has also benefited from industry-wide increased rate levels over the same time period. However, Standard & Poor's believes that the company has taken prudent steps to address operating inefficiencies along with the underwriting actions necessary to lay the structural foundation to achieve long-term underwriting profitability. ONE PRICE: Morgan Lewis Serves as Special Bankruptcy Counsel ------------------------------------------------------------ One Price Clothing Stores, Inc., and its debtor-affiliates are asking permission from the U.S. Bankruptcy Court for the Southern District of New York to retain and employ Morgan, Lewis & Bockius LLP as special bankruptcy counsel. To facilitate the successful completion of these cases, the Debtors require the services of attorneys with knowledge and experience in the areas of bankruptcy law, restructuring and litigation. Consequently, in its capacity, Morgan Lewis will: i) provide legal advice with respect to the Debtors' powers and duties as debtors-in-possession in the continued operation of their business and management of their properties; ii) take necessary action to protect and preserve the Debtors' estates, including the prosecution of actions on behalf of the Debtors, the defense of any action commenced against the Debtors, negotiations concerning all litigation in which the Debtors are involved, and objecting to claims filed against the Debtors' estates; iii) prepare, on the Debtors' behalf, all necessary schedules, statements, applications, motions, responses, objections, orders, reports, and other legal papers; iv) provide legal advice and representing the Debtors with respect to the assumption or rejection of executory contracts and unexpired leases, and numerous other bankruptcy related matters arising from these cases; v) coordinate the services to be provided by special counsel and ordinary course professionals so as to avoid duplication; vi) negotiate and draft agreements for any sale or purchase of assets of the Debtors; vii) represent the Debtors at hearings on matters pertaining to their affairs as debtors-in-possession; viii) negotiate and draft a plan or plans of reorganization and all documents related thereto, including, but not limited to, the disclosure statements and ballots for voting thereon; ix) take the steps necessary to confirm and implement the Plans, including, if needed, modifications thereof and negotiating financing for the Plans; and x) render such other legal services for the Debtors as may be necessary and appropriate in these proceedings. The current hourly rates that Morgan Lewis intends to charge the Debtors for the legal services of its professionals are: Partners and Counsel $385 to $645 per hour Associates $180 to $420 per hour Paralegals $105 to $150 per hour Neil E. Herman, Esq., a member of Morgan Lewis will lead the team in its engagement. Headquartered in Duncan, South Carolina, One Price Clothing Stores, Inc. -- http://www.oneprice.com/-- operates a chain of off price specialty retail stores. These stores offer a wide variety of contemporary, in-season apparel and accessories for the entire family. The Company, together with its two affiliates, filed for chapter 11 protection on February 9, 2004 (Bankr. S.D.N.Y. Case No. 04-40329). Neil E. Herman, Esq., at Morgan, Lewis & Bockius, LLP, represents the Debtors in their restructuring efforts. When the Company filed for protection from its creditors, it listed $110,103,157 in total assets and $112,774,600 in total debts. OWENS CORNING: Lease Decision Period Stretched to June 4, 2004 -------------------------------------------------------------- Owens Corning and its debtor-affiliates sought and obtained Judge Fitzgerald's approval to extend the time within which they must move to assume or reject their unexpired non-residential real property leases, through and including June 4, 2004, subject to the rights of each lessor under an Unexpired Lease to request, upon appropriate notice and motion, that the Court shorten the Extension Period and specify a period of time in which the Debtors must determine whether to assume or reject an Unexpired Lease. (Owens Corning Bankruptcy News, Issue No. 67; Bankruptcy Creditors' Service, Inc., 215/945-7000) OXFORD AUTOMOTIVE: Q3 Conference Call Scheduled For February 19 --------------------------------------------------------------- A telephone conference call to discuss results for the third quarter ended December 31, 2003 of Oxford Automotive, Inc. and other matters will be held on: Date: Thursday, February 19, 2004 Time: 11:00 a.m. Eastern Toll-free call in number: (877) 347-5103 Participant pass code: 19770829 Participants are asked to begin dialing in to the conference call a few minutes before the scheduled start time. Participating in the call on behalf of Oxford will be John W. Potter, Chief Executive Officer, Jeffrey W. Wilson, President, and Patrick T. Flynn, Chief Financial Officer. There will be no replay of the conference call available following the call. Oxford Automotive, Inc., with headquarters in Troy, Mich., is a leading Tier 1 supplier of specialized welded metal assemblies and related services. The company, which is privately held, currently has approximately 7,200 employees at 33 locations in nine countries, with technology centers in the United States, France, Germany and Italy. Annual revenues for the fiscal year ended March 31, 2003 were approximately $1 billion. * * * In October, Standard & Poor's Ratings Services withdrew its 'B+' corporate credit rating on Troy, Michigan-based Oxford Automotive Inc. and removed the rating from CreditWatch where it was placed Sept. 12, 2003. "Oxford previously postponed a debt offering and is currently in the process of evaluating alternative financing options," said Standard & Poor's credit analyst Eric Ballantine. PETRO STOPPING: S&P Assigns B- Rating to $225-Mil. Sr. Sec. Notes ----------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B-' rating and '3' recovery rating to Petro Stopping Centers L.P.'s $225 million senior secured notes due 2012. These notes were issued pursuant to Rule 144A with registration rights. The notes are rated one notch below the corporate credit rating; this and the '3' recovery rating indicate the expectation of meaningful recovery of principal (50%-80%) in the event of a default. In addition, Standard & Poor's raised the rating on the company's senior secured bank loan to 'BB-' from 'B+' and assigned a '1' recovery rating to the loan. The bank loan is rated two notches higher than the corporate credit rating; this and the '1' recovery rating indicate a high expectation of full recovery of principal in the event of a default. The 'B' corporate credit rating for Petro was affirmed and removed from CreditWatch, where it was placed Aug. 28, 2003. The outlook is negative. The affirmation is based on Petro's stable operating performance over the past two years, as well as its enhanced liquidity as a result of extended maturities and lower cash interest payments under the refinancing. Proceeds from these issues, along with cash, were used to repay the company's existing $135 million senior unsecured notes and Petro Stopping Centers Holdings L.P.'s existing $113.7 million face value of senior discount notes due 2008. The new term loan is $25 million, $20 million less than the previous term loan. "The ratings reflect the company's participation in the highly competitive and fragmented truck stop industry, its high debt levels, and the volatility of diesel fuel prices," said Standard & Poor's credit analyst Patrick Jeffrey. These factors are somewhat mitigated by Petro's maintenance of a leading position in the industry. The negative outlook reflects the company's continued high leverage and thin cash flow coverage ratios. A further deterioration in these credit measures or reduced liquidity could result in a ratings downgrade in the near term. El Paso, Texas-based Petro is one of the leading operators in the truck stop industry, with the top five chains selling about 83% of all over-the-road diesel fuel. Although Petro differentiates itself through quality of service, Standard & Poor's believes that the company's smaller size and lack of national scope relative to other competitors make it more difficult to attract truck fleet business. Because of this, the company has been more affected by the economic slowdown in the U.S. than some of its competitors. PG&E NATIONAL: Valuation Analysis under NEG's 2nd Amended Plan -------------------------------------------------------------- In conjunction with formulating the Plan, National Energy & Gas Transmission Inc. has determined that it was necessary to estimate the post-confirmation going concern value of Reorganized NEG. Accordingly, in calculating the value of Reorganized NEG, Lazard Freres & Co. LLC, among other things: (a) reviewed publicly available financial statements of NEG, and its direct and indirect subsidiaries; (b) reviewed certain internal financial and operating data, including the forecasts prepared and provided by NEG's management relating to its business and its prospects; (c) met with certain members of NEG's senior management to discuss the operations and future prospects; (d) considered certain other financial projections prepared by NEG; (e) discussed historic, current and prospective operations of the operating business with NEG; (f) considered certain information of publicly traded companies believed to be reasonably comparable to NEG's operating business; and (g) reviewed other information and conducted other studies, analyses, inquiries, and investigations as deemed appropriate. The estimated calculation of going concern value is highly dependent on achieving the future financial results set forth in Reorganized NEG's business plan as well as the realization of certain other assumptions, none of which are guaranteed and many of which are outside of NEG's control. The estimates of value represent estimated reorganization values and do not necessarily reflect values that could be attainable in public or private markets. The values do not purport to be an estimate of post-reorganization market value or a value that might be realized in a private market sale transaction. The calculations of value do not conform to the uniform standards of professional appraisal practice of the appraisal foundation. The calculations of value set forth in the NEG valuation supersede in their entirety the calculations contained in prior versions of the disclosure statement. Valuation Methodology A sum-of-the-parts valuation was employed to estimate the going concern value of Reorganized NEG. Reorganized NEG includes the operations of Gas Transmission Northwest Corporation, equity interests in a variety of generation and gas transmission assets -- the IPPs -- various Operations & Maintenance and Management Services Agreement contracts under which NEG provides operations and maintenance and management services at many of the IPP assets, various real estate properties and all related corporate overhead. The sum-of-the-parts valuation for Reorganized NEG combines the theoretical equity valuations of GTNC and NEG's ownership interests in the IPPs as well as the equity value of other miscellaneous assets. GTNC's equity value is estimated by calculating the total enterprise value and subsequently subtracting the net debt. The equity value of the IPPs was estimated using a discounted cash flow analysis in which levered free cash flows were discounted at an estimated cost of equity. The equity values of both GTNC and the IPPs were combined with the estimated value of other miscellaneous NEG assets to determine a going concern enterprise valuation of Reorganized NEG. The equity value of Reorganized NEG can be estimated by subtracting the assumed amount of new debt issued by NEG at emergence. Gas Transmission Northwest Corporation In valuing GTNC, both public company multiples-based and discounted cash flow valuation techniques were employed. The public company multiple methodology values a company based on a relative comparison with other publicly traded companies with similar operating and financial characteristics. Equity and total enterprise value multiples are derived for each of the comparable companies based on various operating statistics. The implied enterprise and equity values of the company being valued are then calculated by multiplying relevant operating statistics of the business by the public comparable company multiples. Due to the lack of public companies directly comparable to GTNC, valuation estimates incorporate multiples from recent comparable acquisitions. These acquisition multiples were discounted to adjust for observed private market control premiums and, thereby, more closely approximate public trading multiples. After calculating estimated GTNC enterprise value under this methodology, GTNC's debt was subtracted to determine NEG's hypothetical value. An unlevered discounted cash flow valuation analysis was also employed to value to GTNC. This Discounted Cash Flow valuation methodology equates the value of an asset or business to the present value of expected future economic benefits to be generated by the asset or business, as reflected in its unlevered free cash flows. The Discounted Cash Flow methodology is a "forward-looking" approach that discounts all expected future economic benefits by a theoretical or observed discount rate determined by calculating the Weighted Average Cost of Capital of Reorganized NEG. After calculating the estimated GTNC enterprise value under this methodology, the GTNC debt was subtracted to determine NEG's hypothetical value. The WACC employed in the unlevered DCF valuation analysis was calculated by weighting the required returns on interest-bearing debt and common equity capital in proportion to their estimated percentages in an expected capital structure. The cost of equity for Reorganized NEG was estimated using the Capital Asset Pricing Model -- CAPM -- based on the risk-free rate of return on United States treasury bonds, plus a market risk premium expected over the risk-free rate of return, multiplied by a market-derived "beta". An after-tax cost of debt was calculated based on a theoretical expected market cost of debt and GTNC's expected corporate tax rate. The IPP A DCF approach was used to calculate the value of NEG's IPP ownership interests. NEG's interests in individual contracted plants were valued using a discounted cash flow analysis treating cash distributions to NEG as levered free cash flows. Contracted cash flows are discounted for the full life of the contract using a cost of equity that was derived using the CAPM. Estimated post-contract cash flows were also forecasted and discounted at a cost of equity derived using the CAPM. Other Assets and Certain Tax Matters NEG owns various real estate properties, which are valued on a DCF basis. In addition, NEG may emerge from Chapter 11 with NOLs that could be available to offset taxable income. Due to the uncertainty surrounding the amount and availability of NOLs that Reorganized NEG might retain or realize and be able to use without restriction, the value of the NOLs to Reorganized NEG was not included in the calculation of the firm's total enterprise value. $1.4 to $1.6 Billion Estimated Value Using the different valuation techniques, the hypothetical equity valuation range of the reorganized going concern enterprise is between $1,410,000,000 and $1,660,000,000. The Plan contemplates $1,000,000,000 in holding company debt, netting equity value between $410,000,000 and $660,000,000. These values exclude any funds to be distributed pursuant to the Plan and any value related to NOLs, which may be available to Reorganized NEG. This range of values for Reorganized NEG was prepared based on information available as of January 2004. This estimate was developed solely for purposes of formulation and negotiation of a Plan and analysis of implied relative recoveries to creditors. The calculation of value does not address any other aspect of the proposed restructuring or any related transactions and does not constitute a recommendation to any holder of outstanding NEG securities as to how the security holder should vote or act on any matter relating to the restructuring or any related transaction. Lazard's calculation of value does not constitute an opinion as to the fairness to holders of outstanding NEG securities from any point of view, including a financial point of view of the consideration to be received by the security holders pursuant to the plan. Estimates of reorganization going concern value do not purport to reflect or constitute appraisals, liquidation values or estimates of the actual market value that may be realized through the sale of any securities to be issued pursuant to the Plan, which may be significantly different from the amounts set forth in the valuation. (PG&E National Bankruptcy News, Issue No. 15; Bankruptcy Creditors' Service, Inc., 215/945-7000) PHOENIX INT'L: Creditor Gerard Haryman Converts $1M Loan to Equity ------------------------------------------------------------------ The following action has been approved by the Board of Directors of Phoenix International Industries, Inc.: On January 21, 2004, Gerard Haryman, Chairman, President and CEO, of Epicus Communications Group, Inc. (formerly, Phoenix International Industries, Inc.), converted to equity, $1,000,000 of the monies owed to him, consisting of loans made by Mr. Haryman to the Company. Said equity will be in the form of the Company's common stock Restricted per "Rule 144" of the Securities Exchange Act of 1933. To convert the face dollar amount of $1,000,000 into the Company's Rule 144 restricted shares of common stock, a conversion price was determined by using the average closing price for the 20 trading days prior to January 21, 2004, with an applied holding discount of 50%. Phoenix International Industries, Inc., is a Florida holding company, whose primary focus is the telecommunications and internet industries. Phoenix focuses on identifying and investing in growth stage technology issues. The company's November 30, 2003, balance sheet reports a net capital deficit of about $9 million. PICCADILLY CAFETERIAS: Agrees To Sell Assets For $80 Million ------------------------------------------------------------ Piccadilly Cafeterias, Inc. announced that it has agreed to sell its assets and ongoing business operations to Piccadilly Investments LLC, for a cash sale price of nearly $80 million. The agreement is the culmination of a Section 363 bankruptcy sale process that concluded with an auction on Wednesday, February 11. The transaction, approved by Piccadilly's Board of Directors and the presiding bankruptcy judge, Raymond B. Ray, is expected to close by mid-March. Vince Colistra, Piccadilly's Chief Restructuring Advisor and the Managing Director from Phoenix Management Services, said, "We are very pleased with the outcome of the bankruptcy auction, because it resulted in a significant increase from the $54 million initial offer we announced when the company filed for bankruptcy last year." In addition to a voluntary chapter 11 filing, the 2003 agreement also called for Piccadilly to continue soliciting proposals from other interested parties. It was during this time that the newly formed Piccadilly Investments LLC submitted a qualifying offer of $55.8 million, resulting in a very competitive bankruptcy auction, bumping the price up to $80 million, which was $1 million higher than the preceding competing bid of $79 million. Piccadilly Investments LLC is an acquisition company jointly owned by The Yucaipa Companies and Diversified Investment Management Group, two Los Angeles-based private equity firms. "We are excited to be acquiring Piccadilly with its long and proud tradition. It has a tremendous brand name with significant growth potential," said Ron Burkle, Managing Partner of The Yucaipa Companies. According to its own press release, Yucaipa brings its strategic, financial and operational expertise to the companies it owns. Yucaipa has stated that its investment will provide Piccadilly with the resources to remodel, replace and revitalize existing cafeterias and expand into new locations. Yucaipa also looks forward to working with local communities and redevelopment agencies across the geographic area in which Piccadilly operates, according to the company's statement. Jack McGregor, the acting Chief Executive Officer of Piccadilly, said the purchase "is excellent news for our loyal team members and guests," and noted that the buyer has "indicated its intention to retain Piccadilly's corporate headquarters in Baton Rouge." Even after paying the customary break-up fee to Piccadilly's initial prospective buyer, the enhanced purchase price will allow Piccadilly to fully retire its outstanding bank debt and senior notes, and leave a substantial amount for pro rata distribution to its unsecured creditors. Unfortunately, no monies will be available for distribution to common stockholders, according to McGregor. "Going forward, Piccadilly will have standing behind it the substantial financial resources of a highly sophisticated private equity group. We are very grateful to our guests, our team members and our board," said McGregor, "for their loyalty during these past several months." PINNACLE ENT.: Gets $2M For Extending Time for Calif. Land Sale --------------------------------------------------------------- Pinnacle Entertainment, Inc. (NYSE: PNK) announced that it has amended and reinstated its agreement with the Rothbart Development Corporation for the sale of 60 acres of land in Inglewood, California. Among other things, the amendment extends the time for closing the transaction until April 30, 2004 in consideration of a non-refundable payment of $2 million. The payment shall be credited against the purchase price of $36 million at the transaction's closing. The amendment also grants the buyer the option to further extend the closing until May 31, 2004 by written notice on or before April 30, 2004 in consideration of an additional non-refundable payment of $1 million which also would be credited against the purchase price at closing. The original agreement had been terminated by its terms in December 2003. The Company has also received an additional payment of $1,100,000 from a regional homebuilder for an extension of time to close the transaction for the sale of a different 37 acres in Inglewood, California until March 31, 2004. The Company has now received a total of $2,150,000 in extension payments from the buyer which will be credited against the purchase price of $22,200,000 at the closing. Pinnacle Entertainment (S&P, B Corporate Credit Rating, Stable) owns and operates eight casinos (four with hotels) in Nevada, Mississippi, Louisiana, Indiana and Argentina, and receives lease income from two card club casinos, both in the Los Angeles metropolitan area. The Company is also developing a major casino resort in Lake Charles, Louisiana. PROLOGIC MANAGEMENT: Gets Nod to Tap Felker Altfeld as Counsel -------------------------------------------------------------- Prologic Management Systems, Inc., sought and obtained approval from the U.S. Bankruptcy Court for the District of Arizona to employ the firm of Leonard Felker Altfeld Greenberg & Battaile, P.C., as counsel in this chapter 11 proceeding. The Debtor has selected Leonard Felker because of the Firm's experience in matters of this character, and believes that it is well qualified to represent it as debtor-in-possession in this case. The Debtor expects Leonard Felker to: a) give the Debtor legal advice with respect to its powers and duties as debtor-in-possession in the operation of its business and management of its property; b) prepare on behalf of the Applicant as debtor-in- possession necessary applications, answers, orders, reports and other legal papers; c) apply for a cash collateral order; d) prepare and file a Disclosure Statement and Plan of Reorganization; and e) perform all other legal services for the debtor-in- possession which may be necessary herein. The professionals who will have primary duties in this engagement and their current hourly rates are: Clifford B. Altfeld $250 per hour Edith I. Rudder $200 per hour R. David Sobel $200 per hour Headquartered in Tucson, Arizona, Prologic Management Systems Inc. -- http://www.prologic.com-- provides a full range of hardware and commercial software solutions, with a focus on a UNIX-based products, as well as Microsoft NT. The products and services provided by the Company include system integration, software development, proprietary software products and related services. The Company filed for chapter 11 protection on February 2, 2004 (Bankr. Ariz. Case No. 04-00394). Clifford B. Altfeld, Esq., at Leonard Felker Altfeld et al., represents the Debtor in its restructuring efforts. When the Company filed for protection from its creditors, it listed $2,502,265 in total assets and $14,306,386 in total debts. PRUSSIA ASSOCIATES: Retains Dilworth Paxson as Attorney ------------------------------------------------------- The U.S. Bankruptcy Court for the Eastern District of Pennsylvania gave its nod of approval to Prussia Associates, a Pennsylvania Limited Partnership in its application to employ Dilworth Paxson LLP as Attorney. The professional services that Dilworth Paxson shall render are necessary to enable the Debtor to execute its duties. It is expected that Dilworth Paxson will: a. provide Debtor with legal services with respect to its powers and duties as debtor-in-possession; b. prepare on behalf of Debtor or assisting Debtor in preparing all necessary pleadings, motions, applications, complaints, answers, responses, orders, United States Trustee reports, and other legal papers; c. represent the Debtor in any matter involving contests with secured or unsecured creditors, including the claims reconciliation process; d. assist the Debtor in providing legal services required to prepare, negotiate and implement a plan of reorganization; and e. perform all other legal services for the Debtor which may be necessary herein, other than those requiring specialized expertise for which special counsel, if necessary, may be employed. Lawrence G. McMichael, Esq., a partner in Dilworth Paxson will lead the team in this engagement and will bill the Debtors with $500 per hour in exchange for its services. The other member of the team and their current hourly rates are: Martin J. Weiss $330 per hour Mary T. Tomich $320 per hour D. Sam Anderson $175 per hour Michelle Petroni $100 per hour Headquartered in King of Prussia, Pennsylvania, Prussia Associates, a Pennsylvania Limited Partnership offers outstanding facilities and the highest levels of service. The hotel has all the amenities of an urban hotel in a suburban park-like setting. The Company filed for chapter 11 protection on January 26, 2004 (Bankr. E.D. Pa. Case No. 04-11042). Lawrence G. McCMichael, Esq., and Martin J. Weis, Esq., at Dilworth Paxon LLP represent the Debtor in its restructuring efforts. When the Company filed for protection from its creditors, it listed over $10 million in both estimated debts and assets. RCN HOLDING: Will Not Make Interest Payment on 10-1/8% Sr. Notes ---------------------------------------------------------------- RCN Corporation (Nasdaq: RCNC) announced that the Company is continuing negotiations on a collaborative basis with its senior secured lenders, an ad hoc committee of holders of its Senior Notes and others regarding a consensual financial restructuring of its balance sheet. RCN said that it is hopeful that these negotiations will lead to agreement on a successful consensual financial restructuring plan in the near term, although there is no assurance this will occur. In connection with these negotiations, RCN will not make the approximately $10.3 million interest payment due January 15, 2004 on its 10 1/8% Senior Notes due 2010 within the 30-day grace period provided under the indenture governing the 10 1/8% Senior Notes. RCN previously announced on January 15, 2004, that as part of its ongoing financial restructuring negotiations, it had chosen to defer the decision to make the interest payment on its 10 1/8% Senior Notes. In view of the continuing financial restructuring negotiations, RCN, the Lenders and members of the Noteholders Committee have entered into forbearance agreements under which the Lenders and members of the Noteholders' Committee have agreed not to declare any Events of Default, which they would be entitled but not required to do, under RCN's senior credit facilities or RCN's senior notes, respectively, as a result of RCN not making the interest payment on the 10 1/8% Senior Notes prior to the end of the grace period. If such declarations were made, the indebtedness would become immediately due and payable. These forbearance agreements will expire on March 1, 2004, unless extended. RCN Corporation, the parent holding company, said that it expects any financial restructuring to be implemented through reorganization under chapter 11. RCN believes that a consensual financial restructuring pursuant to a chapter 11 reorganization would achieve the most successful financial outcome for the holding company and its constituents. RCN does not intend that its market operating subsidiaries be included in such a chapter 11 filing. Additionally, it is anticipated that a filing at the holding company level would not have any adverse effect on customers and vendors. "We will continue to negotiate the terms of a financial restructuring with our senior lenders, noteholders and others during the time afforded us by the forbearance arrangements, and we expect to maintain normal operations throughout the financial restructuring process," said David C. McCourt, Chairman and Chief Executive Officer of RCN. "We will continue to provide our customers with the same high-quality bundled services and superior customer service without any interruption, and will continue to act responsibly towards our employees and vendors. "This has been and will be a difficult process, but we believe it will positively impact our operating companies, vendors, customers, and employees and in an effort to communicate directly with these important constituents, we are launching http://www.rcntomorrow.com/which will provide updates on where we are in the restructuring process," said Mr. McCourt. "We expect to emerge from any consensual restructuring as a stronger, more viable and more competitive company, positioned for long-term success." RCN's objective is to reach agreement on a consensual financial restructuring plan during the current forbearance period. RCN is encouraged as to the prospect of doing so. If however, discussions were to proceed beyond that period or were to end, additional forbearance, waiver and/or amendment agreements would be needed to support continuing operations. In addition, in the absence of an agreement on a consensual financial restructuring upon expiration of the forbearance agreements, the Lenders and members of the Noteholders' Committee who hold 10 1/8% Senior Notes would be entitled, but not required, to declare RCN's senior credit facilities and the outstanding 10 1/8% Senior Notes, respectively, immediately due and payable. Any acceleration of amounts due under RCN's senior credit facilities or the 10 1/8% Senior Notes would, due to cross default provisions in the Company's indentures governing its other senior notes, entitle, but not require, the holders of other senior notes to declare the Company's other senior notes immediately due and payable if they so choose. Holders of 10 1/8% Senior Notes that are not members of the Noteholders' Committee are not subject to the terms of the forbearance agreements. If acceleration of the Company's senior credit facilities and 10 1/8% Senior Notes were to occur, RCN would not, based on current and expected liquidity, have sufficient cash to pay the amounts that would be payable. Although RCN is actively pursuing discussions towards a final agreement on a consensual financial restructuring, there can be no assurance that such an agreement will ultimately be reached, that RCN would be able to obtain further extensions of its forbearance agreements with the Lenders and members of the Noteholders' Committee, or that a holders of 10 1/8% Senior Notes that are not members of the Noteholders' Committee will not declare an Event of Default under the 10 1/8% Senior Notes (which would terminate the forbearance agreement with Lenders), or seek other remedies available under applicable law or the terms of the 10 1/8% Senior Notes, prior to such time. RCN will continue to apply substantial effort and resources to reaching a formal agreement on a consensual financial restructuring while also continuing to evaluate the best alternatives for RCN under current circumstances and as discussions and events unfold. Since financial restructuring negotiations are ongoing, the treatment of existing creditor and stockholder interests in the company is uncertain at this time. However, RCN has said that the restructuring will likely result in a conversion of a substantial portion of its outstanding Senior Notes into equity and an extremely significant, if not complete, dilution of current equity. RCN also said that it has chosen to defer the decision to make an interest payment scheduled to be made on February 15, 2004, of approximately $14.2 million with respect to its 9.80% Senior Discount Notes Due 2008. In the event that RCN does not make this interest payment within 30 days beginning February 15, 2004, an Event of Default would arise with respect to the 9.80% Senior Notes and entitle, but not require, holders thereof to declare the outstanding 9.80% Senior Notes immediately due and payable. For additional information about the restructuring process, visit http://www.rcntomorrow.com. RCN Corporation (Nasdaq: RCNC) is the nation's first and largest facilities-based competitive provider of bundled phone, cable and high speed internet services delivered over its own fiber-optic local network to consumers in the most densely populated markets in the U.S. RCN has more than one million customer connections and provides service in Boston, New York, Philadelphia/Lehigh Valley, Chicago, San Francisco, Los Angeles and Washington, D.C. metropolitan markets. RELIANCE: Court Okays Proposed Settlement with PNC Leasing et al. ----------------------------------------------------------------- Reliance Insurance Company sought and obtained the Court's permission to enter into a settlement with: -- Hartford Fire Insurance Company; -- Hartford Specialty Company; -- Hartford Financial Services Group; -- PNC Vehicle Leasing; -- PNC Leasing; -- PNC Financial Services Group; -- Magellan Insurance Company; and -- Swiss Reinsurance America Corporation. PNC purchased two policies of vehicle residual value insurance, Nos. NZB 100-4007 and NZB 100-4012 from RIC. Hartford purchased assets and acquired from RIC future renewal rights on RIC policies for vehicle residual value insurance. Hartford agreed to reinsure RIC's retained net liability on the PNC Policies. Swiss Reinsurance and RIC entered into a reinsurance contract pursuant to which Swiss Reinsurance agreed to reinsure a portion of RIC's liability under the PNC Policies on a quota share basis. Pursuant to a "Tri-Arc Residual Value Quota Share Reinsurance Treaty," Magellan agreed to reinsure a portion of RIC's liability under the PNC Policies. PNC has made claims directly against Hartford for payments it alleges are due for losses arising after November 3, 2001, and that are not included in the settled claims. This includes claims PNC has asserted in a civil action captioned "PNC Vehicle Leasing LLC and PNC Leasing LLC v. The Hartford Financial Services Group, Inc., and Hartford Specialty Company," before the Court of Common Pleas of Allegheny County, Pennsylvania. The Claims are separate from all settled claims, as they are based on allegations Hartford made or actions Hartford took before RIC was placed in rehabilitation. The claims resulted in Hartford having direct liability to PNC for alleged losses on vehicles enrolled under the PNC Policies that came off lease after November 3, 2001. Hartford argued that its liability is reinsured by Magellan or Swiss Reinsurance, but on which RIC has no liability to PNC, due to the Liquidation Order, which terminated RIC's liability. PNC, Hartford, Swiss Reinsurance and Magellan do not dispute the termination of RIC's liability. Magellan contended it owed nothing to either RIC or Hartford. PNC contended that it has incurred losses arising out of its vehicle leasing business that are compensable under the PNC Policies. The Settlement RIC and PNC agreed on a total adjusted pre-November 3, 2001, loss on the PNC Policies of $21,990,000, before applying the relevant deductible. PNC and RIC agreed -- and Hartford, Swiss Reinsurance and Magellan did not contest -- that the portion of the deductible under the program applicable to this loss is $13,450,000, leaving an $8,540,000 net allowed claim. PNC acknowledged that before November 3, 2001, it was paid by RIC $5,782,000 for losses PNC claimed relating to the PNC Policies. PNC will file a proof of claim in RIC's proceedings for $21,990,000, subject to the $13,450,000 deductible, which will be reduced by the $5,782,000 payments already made to PNC, yielding a $2,758,000 allowed claim against the RIC Estate. RIC and Hartford's reinsurance obligation to RIC is $2,870,000. Magellan's responsibility to PNC is $2,135,000. RIC had drawn down $1,380,000 on a letter of credit, leaving $755,000 in remaining obligation to RIC. Swiss Reinsurance's obligation to PNC is $2,135,000. Swiss Reinsurance paid $204,000 toward the reinsurance obligation, leaving $1,931,000 in remaining obligation to RIC. Upon consummation of the Settlement, all Parties agreed to release each other from any and all liability. (Reliance Bankruptcy News, Issue No. 46; Bankruptcy Creditors' Service, Inc., 215/945-7000) REVLON CONSUMER: S&P Places Current Ratings on Watch Positive ------------------------------------------------------------- Standard & Poor's Ratings Services placed its rating on Revlon Consumer Products Corp. on CreditWatch with positive implications, following the company's announcement that it had reached an agreement with MacAndrews & Forbes and Fidelity Investments, two of its largest creditors, to reduce $930 million of its $1.9 billion in total debt. This reduction will be primarily through a debt-for-equity exchange. Of the total $930 million, approximately $780 million will be exchanged by March 31, 2004, and the remainder will be completed by March 2006. Public debtholders have also been given the option to exchange their holdings for equity. "After the planned transaction, Standard & Poor's believes the company's credit profile will be stronger, and that the corporate credit rating will rise into the 'B' category," said credit analyst Patrick Jeffrey. Standard & Poor's views the privately negotiated agreements with Fidelity and MacAndrews & Forbes (Revlon's principal shareholder) as completing the bulk of Revlon's capital restructuring. The planned transaction will stabilize the company's credit profile, significantly reducing leverage and improving liquidity. The exchange offer for various publicly held debt issues would further improve the credit profile. The value of these offers either exceeds or approaches par based on Revlon's current stock price. These factors are reflected in Revlon's bonds, which are no longer trading at distressed levels. Standard & Poor's will meet with management once the extent of bondholder acceptance of the exchange offer is determined. The ratings impact will then be evaluated. ROBOTIC VISION: Dec. 2003 Shareholder Deficit Narrows to $6.5M -------------------------------------------------------------- Robotic Vision Systems, Inc. (RVSI) (RVSI.PK) reported results for its fiscal year 2004 first quarter ended December 31, 2003. First quarter revenues were $10,337,000 compared to $10,388,000 in fiscal 2003's first quarter and $13,500,000 in fiscal 2003's fourth quarter. RVSI's net loss in fiscal 2004's first quarter was $4,637,000, or $0.31 net loss per share; compared to a net loss of $8,534,000 or $0.70 net loss per share in fiscal 2003's first quarter; and $3,486,000, or $0.27 net loss per share in fiscal 2003's fourth quarter. Orders for the quarter ended December 31, 2003 were $12,533,000, yielding a book-to-bill ratio of 1.20 to 1. The above results incorporate consolidated revenues for both the Semiconductor Equipment Group and Acuity CiMatrix. All results are inclusive of unusual gains and losses, and reflect the one- for-five reverse stock split effected in November 2003. Robotic Vision Systems' December 31, 2003 balance sheet shows a working capital deficit $24,420,000. Total stockholders' equity deficit narrowed to $6,466,000 as compared to $10,450,000 in September 2003 "We believe the first quarter was the final page of an old story," said Pat V. Costa, Chairman and CEO of RVSI. "Part of our attention during the quarter was diverted by the need to complete our line of credit, which we did at the beginning of December. Moreover, we were not able to convert all of our shippable backlog into revenue, and we faced long vendor lead times on certain parts." "This current quarter is a very different story," Mr. Costa said. "Through yesterday, incoming orders are more than double the level of the same time last quarter and, in the current quarter, we know of few impediments to shipping against backlog. What's especially encouraging is that, on the order front at our Semiconductor Equipment Group, the very strong improvement in the current quarter comes in spite of the typical two-week shutdown most Asian test, assembly, and packaging houses take for the lunar new year in late January or early February." Second Quarter Outlook "We entered the quarter with backlog of $10.1 million, we believe we can see bookings in a range of $16 million to $19 million," Mr. Costa said. "Based on those figures, we believe we can see recognizable revenue in the March quarter from $15 million to $17 million. It is clear that this is going to be a quarter of dramatically improved P&L performance. We do not promise operating profitability in this quarter, but neither do we rule it out." "Beyond the current quarter, I am extremely encouraged by the positive direction the business is taking as indicated by the rising rate of bookings and shipments, and I believe that the balance of FY04 should show sequential, sustained improvement." Robotic Vision Systems, Inc. (RVSI) (RVSI.PK) has the most comprehensive line of machine vision systems available today. Headquartered in Nashua, New Hampshire, with offices worldwide, RVSI is the world leader in vision-based semiconductor inspection and Data Matrix-based unit-level traceability. Using leading-edge technology, RVSI joins vision-enabled process equipment, high- performance optics, lighting, and advanced hardware and software to assure product quality, identify and track parts, control manufacturing processes, and ultimately enhance profits for companies worldwide. Serving the semiconductor, electronics, aerospace, automotive, pharmaceutical and packaging industries, RVSI holds more than 100 patents in a broad range of technologies. For more information visit http://www.rvsi.comor call (800) 669- 5234. RURAL/METRO: December 2003 Balance Sheet Upside Down By $210 Mil. ----------------------------------------------------------------- Rural/Metro Corporation (Nasdaq:RURL), a leading national provider of medical transportation and fire protection services, announced results for the quarter ended December 31, 2003, the second quarter of its fiscal 2004. Net revenue for the second quarter of fiscal 2004 totaled $134.1 million, a 9.3% increase over net revenue of $122.7 million for the second quarter of fiscal 2003. For the first six months of fiscal 2004, the company reported $265.9 million in net revenue, a 7.9% increase over the $246.4 million reported for the same period in fiscal 2003. For the three months ended December 31, 2003, medical transportation and related services revenue increased to $114.6 million, or 11.2%, from $103.1 million for the comparable period ended December 31, 2002. The company attributed the gain primarily to increases in same-service-area transport volume, new contract revenue and rate increases. On a same-service-area basis, medical transportation and related service revenue increased 9.5% over the previous quarter and 8.6% over the first six months of fiscal 2003. Income from continuing operations for the fiscal 2004 second quarter was $2.3 million compared to a loss from continuing operations of $1.0 million in the same period of fiscal 2003. For the first six months of fiscal 2004, the company generated income from continuing operations of $3.4 million, compared with a loss from continuing operations of $1.4 million for the same period in fiscal 2003. After considering losses from discontinued operations of $0.2 million, net income for the period ended December 31, 2003 totaled $2.2 million compared to a net loss of $0.3 million for the same period in fiscal 2003. Rural/Metro Corp.'s December 31, 2003 balance sheet shows a total stockholders' equity deficit of $210,080,000 Jack Brucker, President and Chief Executive Officer, said, "Throughout the second quarter, we continued to meet our financial objectives while achieving revenue growth within our core medical transportation segment. We are pleased with the results and look forward to building on this level of performance in the future." Daily cash deposits for the second quarter of fiscal 2004 were consistent with first quarter results, averaging $1.8 million per day. Cash collections during the first six months of fiscal 2004 totaled $224.6 million, compared to $220.8 million for the same period of the prior year. For the three months ended December 31, 2003, the company generated $12.3 million in earnings before interest, taxes, depreciation and amortization (EBITDA), compared to $10.4 million for the same period of the prior year, an 18.3% improvement. For the first six months of fiscal 2004, the company reported EBITDA of $24.4 million, compared with $32.6 million for the same period of the prior year. The six-month comparison for fiscal 2003 includes a $12.5 million, non-cash gain from the disposal of the company's Latin American operations. Excluding the Latin American gain, the company reported year-to-date EBITDA in fiscal 2003 of $20.1 million. The company regards EBITDA, which is widely used by analysts, investors, creditors, and other interested parties, as relevant and useful information. The company provides this information to permit a more comprehensive analysis of its ability to meet future debt service, capital expenditure, and working capital requirements. Additionally, the company's management uses this information to evaluate the performance of its operating units. EBITDA is not intended to represent cash provided by operating activities as defined by generally accepted accounting principles and it should not be considered as an indicator of operating performance or an alternative to cash provided by operating activities as a measure of liquidity. Throughout the second quarter and in recent weeks, the company secured new and renewal contracts among key customers in a variety of regional service areas. Renewal contracts included exclusive agreements to provide emergency ambulance transportation in Mesa and Gilbert, Arizona, as well as Loudon and Franklin counties in Tennessee. Additionally, the company was awarded a new contract to provide non-emergency ambulance transportation services to Marymount Hospital in Cleveland, Ohio. Brucker continued, "While we continue to execute our hub-and-spoke strategy to increase top-line growth within established service areas, we also remain very focused on the profitability of our existing operations to ensure they are aligned with our business strategy and can produce long-term growth." During the second quarter, the company announced that it would exit from its fire protection services contract in Scottsdale, Arizona, in 2005. Additionally, during the period, the company exited from ambulance operations in Galveston County and Borger, Texas. In addition, the company entered into an agreement to sell a non-core service area in the Southeast. First-quarter discontinued operations included Baltimore, Maryland, and Waco, Texas. Brucker continued, "Our business activities are in line with our strategic objectives as we seek to expand our market share in existing service areas and concentrate on further strengthening our core business. We look forward to continuing these efforts in the future as we strive to increase our return on invested capital by maximizing our presence in growing regional markets, among other strategies." The company sustained trends in several of its key operating statistics in the second quarter, reporting an average EMS patient charge of $308, compared to $289 in the same period of the prior year, or an increase of 6.6%. Days' sales outstanding (DSO) averaged 43 days for the second quarter of fiscal 2004 compared to 42 days in the first quarter of fiscal 2004 and 47 days for the second quarter of fiscal 2003. The company attributed the slight increase in DSO to the previously mentioned increase in transport volume. Rural/Metro Corporation provides emergency and non-emergency medical transportation, fire protection, and other safety services in 24 states and more than 400 communities throughout the United States. For more information, visit the company's web site at http://www.ruralmetro.com/. SAFFRON FUND: Board Backs Liquidation & Dissolution Proposal ------------------------------------------------------------ The Board of Directors of Saffron Fund, Inc. has decided to recommend the liquidation and dissolution of the Fund at the upcoming annual general meeting of the Fund. The directors voted unanimously in favor of the recommendation. The annual general meeting is currently scheduled for May 13, 2004, with the record date for that meeting being currently set for April 12, 2004. The Fund will distribute a proxy statement to stockholders discussing, among other things, the proposal to liquidate the Fund, which stockholders should carefully review. Saffron Fund, Inc. is a closed-end, non-diversified management investment company. SALOMON BROS: S&P Hatchets Class B-3 Notes' Rating to D from CCC ---------------------------------------------------------------- Standard & Poor's Ratings Services lowered its rating on class B-3 from Salomon Brothers Mortgage Securities VII Inc.'s mortgage pass-through certificates series 1998-AQ1 to 'D' from 'CCC'. Concurrently ratings are affirmed on seven other classes from the same series. The rating on class B-3 is lowered to 'D' due to the $64,620.53 write-down of the class' principal balance and the complete erosion of the class' credit support (provided by subordination) as a result of the collateral incurring losses monthly. The transaction has been realizing net losses averaging approximately $246,000 per month during the most recent 12 months, with approximately 3.24% in cumulative realized losses. Total delinquencies have increased to approximately 17% from approximately 14.88%, with serious delinquencies (90-plus days, foreclosure, and REO) increasing to 13.26% from 11.99% during the same period. The mortgage pool has paid down to approximately 11.97% of its original balance, with approximately 7.02% of the senior certificates outstanding. Standard & Poor's expects continued poor performance of the collateral based on the delinquency profile and will continue to monitor the performance closely. However, class B-2 has adequate credit support at this time to maintain its 'A' rating. The affirmed ratings reflect adequate actual and projected credit support percentages, despite moderate delinquencies and net losses. The collateral consists of 30-year, fixed-rate subprime mortgage loans secured by first liens on residential properties. RATING LOWERED Salomon Brothers Mortgage Securities VII Inc. Mortgage pass-through certs Rating Series Class To From 1998-AQ1 B-3 D CCC RATINGS AFFIRMED Salomon Brothers Mortgage Securities VII Inc. Mortgage pass-through certs Series Class Rating 1998-AQ1 A-5, A-6, A-7 XS-N, XS-T AAA 1998-AQ1 B-1 AA 1998-AQ1 B-2 A SIRIUS SATELLITE: S&P Rates New $250M Convertible Notes at CCC- --------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'CCC-' rating to Sirius Satellite Radio Inc.'s new $250 million convertible notes due 2009. At the same time, Standard & Poor's affirmed its existing ratings, including its 'CCC' corporate credit rating, on the satellite radio broadcaster. The outlook is stable. The New York, New York- based firm has approximately about $450 million in debt. "The company is expected to use the proceeds for general corporate purposes, including expanding distribution and product development," according to Standard & Poor's credit analyst Steve Wilkinson. He noted, "The added liquidity is important to ratings stability given the considerable cash being consumed as Sirius works to accelerate subscriber growth." Sirius' growth has picked up but it continues to trail XM Satellite Radio Inc. in adding new subscribers. Sirius had 261,061 subscribers as of Dec. 31, 2003. The company is taking steps to improve the availability of its service. On February 12, Sirius announced multi-year distribution agreements with Echostar Communications Corp. and RadioShack Corp., each of which will start selling co-branded boom-box and plug & play units in mid-2004. These agreements will more than triple the distribution outlets marketing Sirius' service. The Echostar deal will also give Sirius' service exposure by providing it free of charge to more than 6 million of its premium subscribers and through joint marketing efforts. These deals should help growth and prompted Sirius to raise its 2004 subscriber growth target by 23% and its expected year-end subscriber count to 1 million. The stable outlook reflects the near-term flexibility provided by Sirius' liquid assets and some progress with key operational issues. Rating stability hinges on maintaining sizable liquid assets and continuing progress in building its subscriber base. SIRIUS SATELLITE: Prices Convertible Notes Offering --------------------------------------------------- SIRIUS Satellite Radio (Nasdaq: SIRI) announced that it priced an offering of $250 million of 2-1/2% Convertible Notes due 2009, to a qualified institutional buyer pursuant to Rule 144A under the Securities Act of 1933. In addition, Sirius has granted the initial purchaser a 30-day option to purchase up to an additional $50 million principal amount of the notes. Each $1,000 in principal amount of the notes will be convertible, at the option of the holder, into 226.7574 shares of SIRIUS' common stock, an effective price of $4.41 per share. SIRIUS plans to use the net proceeds for general corporate purposes. The notes, and the common stock issuable upon conversion of the notes, have not been registered under the Securities Act, or any state securities laws, and may not be offered or sold in the United States absent registration under, or an applicable exemption from, the registration requirements of the Securities Act and applicable state securities laws. SIRIUS (S&P, CCC Corporate Credit Rating, Stable) is the only satellite radio service bringing listeners more than 100 streams of the best music and entertainment coast-to-coast. SIRIUS offers 60 music streams with no commercials, along with over 40 world- class sports, news and entertainment streams for a monthly subscription fee of only $12.95, with greater savings for upfront payments of multiple months or a year or more. Stream Jockeys create and deliver uncompromised music in virtually every genre to our listeners 24 hours a day. Satellite radio products bringing SIRIUS to listeners in the car, truck, home, RV and boat are manufactured by Kenwood, Panasonic, Clarion and Audiovox, and are available at major retailers including Circuit City, Best Buy, Car Toys, Good Guys, Tweeter, Ultimate Electronics, Sears and Crutchfield. SIRIUS is the leading OEM satellite radio provider, with exclusive partnerships with DaimlerChrysler, Ford and BMW. Automotive brands currently offering SIRIUS radios in select new car models include BMW, MINI, Chrysler, Dodge, Jeep(R), Nissan, Infiniti, Mazda and Audi. Automotive brands that have announced plans to offer SIRIUS in select models include Ford, Lincoln, Mercury, Mercedes-Benz, Jaguar, Volvo, Volkswagen, Land Rover and Aston Martin. SMITHFIELD FOODS: Will Host 3rd Quarter Conference Call on Feb. 24 ------------------------------------------------------------------ Smithfield Foods, Inc. (NYSE: SFD) will announce its fiscal 2004 third quarter earnings on Tuesday, February 24, before the market opens. The company will host a conference call at 10:00 a.m., Eastern Standard Time, Tuesday, February 24, to discuss third quarter results. The call can be accessed live on the Internet at Vcall, http://www.vcall.com/CEPage.asp?ID=86021.The webcast will be archived on the Smithfield Foods web site, http://www.smithfieldfoods.com/investor/calls. With annualized sales of $9 billion, Smithfield Foods (S&P, BB+ Corporate Credit Rating, Negative) is the leading processor and marketer of fresh pork and processed meats in the United States, as well as the largest producer of hogs. For more information, please visit http://www.smithfieldfoods.com/ STATION CASINOS: Sets Up Rule 105b5-1 Trading Plans for Officers ---------------------------------------------------------------- Frank J. Fertitta III, Chief Executive Officer, Stephen L. Cavallaro, Executive Vice President and Chief Operating Officer and William W. Warner, Executive Vice President and Chief Development Officer of Station Casinos Inc., have entered into Rule 10b5-1 trading plans to sell up to 775,000, 180,000 and 115,600 shares, respectively, of the Company's common stock upon the exercise of certain options. Portions of the shares may be sold any time the stock achieves certain prearranged minimum prices and may take place beginning on January 30, 2004, and ending on June 30, 2004, for Frank J. Fertitta III, and beginning on January 30, 2004, and ending on July 20, 2004, for Stephen L. Cavallaro, and beginning on January 30, 2004, and ending on January 31, 2005, for William W. Warner, unless sooner terminated. The Executive Officers will have no control over the timing of any sales under the respective plans and there can be no assurance that the shares covered by the plans actually will be sold. The Executive Officers entered into the plans in order to diversify their financial holdings, although they will continue to have a significant ownership interest in the Company. These trading plans are intended to comply with Rule 10b5-1 of the Securities Exchange Act of 1934, as amended, and the Company's insider trading policy. Rule 10b5-1 allows corporate insiders to establish prearranged written plans to buy or sell a specified number of shares of a company stock over a set period of time. A plan must be entered into in good faith at a time when the insider is not in possession of material, nonpublic information. Subsequent receipt by the insider of material, nonpublic information will not prevent transactions under the plans from being executed. Station Casinos, Inc. (S&P, BB Corporate Credit Rating, Stable Outlook) is the leading provider of gaming and entertainment to the residents of Las Vegas, Nevada. Station's properties are regional entertainment destinations and include various amenities, including numerous restaurants, entertainment venues, movie theaters, bowling and convention/banquet space, as well as traditional casino gaming offerings such as video poker, slot machines, table games, bingo and race and sports wagering. Station owns and operates Palace Station Hotel & Casino, Boulder Station Hotel & Casino, Santa Fe Station Hotel & Casino, Wildfire Casino and Wild Wild West Gambling Hall & Hotel in Las Vegas, Nevada, Texas Station Gambling Hall & Hotel and Fiesta Rancho Casino Hotel in North Las Vegas, Nevada, and Sunset Station Hotel & Casino and Fiesta Henderson Casino Hotel in Henderson, Nevada. Station also owns a 50 percent interest in both Barley's Casino & Brewing Company and Green Valley Ranch Station Casino in Henderson, Nevada and a 6.7 percent interest in the Palms Casino Resort in Las Vegas, Nevada. In addition, Station manages the Thunder Valley Casino in Sacramento, California on behalf of the United Auburn Indian Community. STOLT OFFSHORE: Completes $100 Million Private Placement --------------------------------------------------------- Stolt Offshore S.A. (Nasdaq: SOSA; Oslo Stock Exchange: STO) announced that the company has closed a financing transaction with European investors through a private placement of 45.5 million new Common Shares at a subscription price of $2.20 per share, resulting in gross proceeds to the Company of approximately $100 million before expenses. Further, the Company expects to raise up to $50 million in a subsequent issue. The net proceeds from these two issues will be used as security for the new bonding facility referred to below, working capital, prepayment of existing debt and/or general corporate purposes. The new Common Shares will not be admitted for listing on the Oslo Stock Exchange until a prospectus has been filed with and approved by the Oslo Stock Exchange, which is expected to occur as soon as practicable. Stolt Offshore has also issued 17 million new Common Shares to Stolt-Nielsen Transportation Group Ltd (SNTG), a subsidiary of Stolt-Nielsen S.A., upon conversion of all outstanding Class B Shares to Common Shares. Furthermore, SNTG has irrevocably undertaken to the Company that it will convert $50 million of subordinated debt owed to it into 22,727,272 new Common Shares at the same subscription price of $2.20 per share. Stolt Offshore has also secured a new bonding facility of $100 million, a condition of the closing of the equity placement, and has reached agreement with its bank syndicate on more appropriate covenants for the remainder of the debt term. Tom Ehret, Chief Executive Officer said, "The receipt of $100 million of new equity and a $100 million bonding facility is an important milestone in Stolt Offshore's financial recovery. The support of our clients as well as our major creditors, led by HSBC, has been an important factor over the past six months and we are pleased to be returning to a more routine operating environment." Stolt Offshore is a leading offshore contractor to the oil and gas industry, specialising in technologically sophisticated deepwater engineering, flowline and pipeline lay, construction, inspection and maintenance services. The Company operates in Europe, the Middle East, West Africa, Asia Pacific, and the Americas. * * * As reported in Troubled Company Reporter's January 2, 2004 edition, Stolt Offshore S.A. obtained an extension from December 15, 2003 until April 30, 2004 of the waiver of banking covenants. Stolt Offshore continues discussions with its lenders towards a long-term agreement. SUPERIOR ESSEX: SEC Declares Registration Statement Effective ------------------------------------------------------------- Superior Essex Inc. (Pink Sheets: SESX.PK) announced that the Securities and Exchange Commission has declared effective the Company's Registration Statement on Form 10 covering its shares of common stock. The Company expects its common stock to begin trading in the near future on the Over-the-Counter Bulletin Board under the symbol SPSX.OB. The Company also stated that it intends to seek a listing on The NASDAQ National Market as soon as it meets the listing requirements for minimum round lot shareholders. About Superior Essex Superior Essex Inc. is one of the largest North American wire and cable manufacturers and among the largest wire and cable manufacturers in the world. Superior Essex manufactures a broad portfolio of wire and cable products with primary applications in the communications, magnet wire, and related distribution markets. The Company is a leading manufacturer and supplier of copper and fiber optic communications wire and cable products to telephone companies, distributors and system integrators; a leading manufacturer and supplier of magnet wire and fabricated insulation products to major original equipment manufacturers (OEM) for use in motors, transformers, generators and electrical controls; and a distributor of magnet wire, insulation, and related products to smaller OEMs and motor repair facilities. Additional information can be found on the Company's web site at http://www.superioressex.com/ * * * As reported in the Troubled Company Reporter's January 16, 2004 edition, Standard & Poor's Ratings Services assigned its 'B+' corporate credit rating to Atlanta, Ga.-based Superior Essex Inc. Standard & Poor's also assigned its 'BB' senior secured bank loan rating to the $120 million senior secured revolving credit facility, maturing in 2007, and its 'B+' rating to the $145 million second-priority secured notes due 2008. Superior Essex Communications LLC and Essex Group Inc., the operating subsidiaries of Superior Essex Inc., are co-borrowers of the credit facility and co-issuers of the notes. Superior Essex Inc. is a guarantor of the notes co-issued by the two operating subsidiaries. TRANSWESTERN PUBLISHING: S&P Assigns Lower-B Level Debt Ratings --------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BB-' senior secured debt ratings to TransWestern Publishing Co. LLC's planned $65 million seven-year senior secured revolving credit and $400 million seven-year senior secured tranche B term loan facilities. At the same time, recovery ratings of '4' were assigned to these facilities. The 'BB-' ratings are the same as the company's corporate credit rating; this and the '4' recovery ratings indicate a marginal recovery (25%-50%) of principal in the event of a default. Standard & Poor's also assigned its 'B' senior secured debt rating and its recovery rating of '5' to the company's planned $200 million eight-year senior second priority secured term loan facility. The 'B' rating is two notches lower than the corporate credit rating; this and the '5' recovery rating indicate that the second priority debt holders can expect negligible recovery (0%- 25%) of principal in the event of a default. Proceeds from these new credit facilities will be used to repay TransWestern's existing indebtedness, consisting of the outstanding credit facility and 9.625% senior subordinated notes due 2007, and to pay a dividend of about $200 million to the company's current equity holders. In addition, Standard & Poor's affirmed its 'BB-' corporate credit and senior secured debt and 'B' subordinated debt ratings on TransWestern. The outlook is negative. Headquartered in San Diego, California, the company will have roughly $600 million of debt outstanding following the transaction. "TransWestern's pro forma financial profile is not indicative of the 'BB-' corporate credit rating. However, it is expected to get there in coming years," said Standard & Poor's credit analyst Donald Wong. The debt to EBITDA measure is expected to decline sharply in 2004 as a result of the combination of lower debt and higher EBITDA levels. In addition, the company is expected to use most, if not all, of its free operating cash flow for debt reduction in the intermediate term. UBIQUITEL INC: Unit Prices $270 Million Offering of Senior Notes ---------------------------------------------------------------- UbiquiTel Inc. (Nasdaq: UPCS), a PCS Affiliate of Sprint, announced that its wholly owned subsidiary, UbiquiTel Operating Company, has priced an offering of $270 million of senior notes due 2011 in a transaction exempt from the registration requirements of the Securities Act of 1933, as amended. The notes will be issued at a price of 98.26% and pay interest semi- annually at a coupon rate of 9.875%. UbiquiTel intends to use the proceeds, net of transaction costs, to repay and terminate the $230 million outstanding borrowings under its senior secured credit facility, to redeem $14.5 million principal amount of its 14% Series B senior discount notes due 2008 for $12.5 million, to purchase and retire $16 million principal amount of its outstanding 14% senior discount notes due 2010for $15.2 million. The transaction is expected to settle on or about February 23, 2004. The senior notes are being offered solely to qualified institutional buyers in reliance on Rule 144A of the Securities Act of 1933, as amended, and to non-U.S. persons in reliance on Regulation S under the Act. About UbiquiTel Inc. UbiquiTel is the exclusive provider of Sprint digital wireless mobility communications network products and services under the Sprint brand name to midsize markets in the Western and Midwestern United States that include a population of approximately 10.0 million residents and cover portions of California, Nevada, Washington, Idaho, Wyoming, Utah, Indiana and Kentucky. * * * As reported in the Troubled Company Reporter's February 10, 2004 edition, Standard & Poor's Ratings Services assigned its 'CCC' rating to UbiquiTel Operating Co.'s $250 million senior unsecured notes due 2011, issued under Rule 144A with registration rights. UbiquiTel Operating Co. is a subsidiary of UbiquiTel Inc., a Sprint PCS affiliate. Simultaneously, Standard & Poor's revised the rating on UbiquiTel Operating Co.'s existing senior unsecured debt to 'CCC' from 'CC' due to the lower amount of priority obligations in the company's capital structure as a result of this transaction. The 'CCC' bank loan rating on UbiquiTel Operating Co. was withdrawn as a result of this transaction. All other outstanding ratings on UbiquiTel and the operating company, including the 'CCC' corporate credit rating, were affirmed. The outlook was revised to positive from developing. UAL CORP: Flight Attendants' Union Seeks to Appoint Examiner ------------------------------------------------------------ The Association of Flight Attendants - Communications Workers of America, AFL-CIO, representing current and retired United Flight Attendants, asks Judge Wedoff to appoint an examiner to investigate allegations that United Airlines Inc. has "engaged in a scheme to intentionally mislead thousands of flight attendants into ending their careers and retiring early, defrauding them out of their retirement benefits." Robert S. Clayman, Esq., at Guerrieri, Edmond & Clayman, in Washington, D.C., says that, while the Debtors were encouraging flight attendants to retire before July 1, 2003, to receive certain health benefits, they were planning to cut those same benefits. This posture induced 2,100 flight attendants to retire early. During this "unprecedented exodus," the Debtors publicly extolled the success of their reorganization efforts but privately plotted to reduce retiree health benefits. Meanwhile, the flight attendants agreed to the Debtors' drastic cost reductions, which ultimately entailed $314,000,000 in AFA concessions. It was expressly agreed that any increases to retiree health care costs would apply only to flight attendants who retired after July 1, 2003. According to Mr. Clayman, appointment of an examiner is warranted because the Debtors fraudulently concealed their scheme until after the July 1, 2003 deadline. The Debtors had an obligation to advise their flight attendants that the contemplated Section 1114 Motion was not just a possibility, but a likelihood. Despite numerous opportunities, the Debtors never advised the flight attendants that if they elected to retire before the deadline, more comprehensive and affordable health benefits would soon evaporate. Mr. Clayman alleges that the Debtors abused Sections 1113 and 1114 of the Bankruptcy Code. The Debtors used Section 1113 to coerce employees into accepting draconian wage cuts. Once this process was concluded, the Debtors focused on Section 1114 to reverse the benefit advantage that enticed thousands of flight attendants to retire early. As a steady stream of positive news on the Debtors' improving financial condition came out, the Debtors never advised the AFA that they were preparing a Section 1114 strategy. According to Section 1104(c), where the public record substantiates "allegations of fraud, dishonesty, incompetence, misconduct, mismanagement or irregularity" by a debtor, the Bankruptcy Code mandates the appointment of an examiner to investigate the allegations. While standing by this public fraud, the Debtors silently watched a parade of 2,100 of their most senior, highest-paid flight attendants walk out their door under the belief that by ending their careers now, they would be securing less expensive and more comprehensive health benefits in the future. Mr. Clayman states that the Debtors and their attorneys lack the requisite independence to impartially report to the Court on these claims. A neutral court-appointed examiner can fairly investigate and assess the evidence and recommend the appropriate relief. Only an independent examiner is qualified to: (1) investigate the AFA's allegations; (2) determine when the Debtors had reason to believe that a Section 1114 Motion was more than a possibility, but a likelihood; and (3) recommend appropriate relief. (United Airlines Bankruptcy News, Issue No. 39; Bankruptcy Creditors' Service, Inc., 215/945-7000) UNITEDGLOBALCOM: Raises About $1 Billion From Rights Offering ------------------------------------------------------------- UnitedGlobalCom, Inc. (UGC) (Nasdaq: UCOMA), announced the preliminary results of its previously announced rights offering, which expired in accordance with its terms at 5:00 p.m., New York City time, February 12, 2004. UGC will receive gross proceeds of approximately $1 billion from the offering, which was fully-subscribed. The subscription agent for the Class A rights offering has informed UGC that Class A rightsholders have subscribed for approximately 63.7 million shares of UGC Class A common stock pursuant to the basic subscription privilege and approximately 66.8 million shares of UGC Class A common stock pursuant to the oversubscription privilege. Due to the substantial oversubscription, UGC will issue 100% of the approximately 83.0 million shares of the UGC Class A common stock offered in the rights offering. Class B and Class C rightsholders have subscribed for approximately 2.3 million shares of UGC Class B common stock and approximately 84.9 million shares of UGC Class C common stock, which represents 100% of the UGC Class B and Class C common stock offered in the rights offering. Shares of UGC Class A common stock requested pursuant to the oversubscription privilege will be allocated among the approximately 19.3 million shares of UGC Class A common stock available to satisfy oversubscription requests in accordance with the proration procedures described in the prospectus for the rights offering. The final allocation will be publicly announced shortly after it is determined. UGC is the largest international broadband communications provider of video, voice, and Internet services with operations in numerous countries. Based on the Company's operating statistics at September 30, 2003, UGC's networks reached approximately 12.6 million homes passed and 9 million RGUs, including approximately 7.4 million video subscribers, 717,900 voice subscribers, and 868,000 high speed Internet access subscribers. The company filed for Chapter 11 relief on January 12, 2004, (Bankr. S.D.N.Y Case No. 04-10156). WOODMERE CHINA: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Woodmere China, Inc. 207 Black Angus Court Millersville, Maryland 21108 Bankruptcy Case No.: 04-10704 Type of Business: The Debtor is a supplier of creative tabletop, giftware products and dinnerware for the home. See http://www.woodmerechina.com/ Chapter 11 Petition Date: January 12, 2004 Court: District of Maryland (Baltimore) Judge: E. Stephen Derby Debtor's Counsel: Alan M. Grochal, Esq. Tydings and Rosenberg 100 East Pratt Street, Fl. 26 Baltimore, MD 21202 Tel: 410-752-9700 Fax: 410-727-5460 Total Assets: $889,741 Total Debts: $3,430,000 Debtor's 20 Largest Unsecured Creditors: Entity Claim Amount ------ ------------ Sterling/Carl Marks $1,757,265 175 Great Neck Road Great Neck, NY 11021 MAI Trust $442,794 c/o Glo Resources 20 Stamoix Street Suite 620 Pittsburgh, PA 15222 Santa Anita $39,084 Product Asia/Volume Tableware $34,398 Revol $20,558 RJ/GL Bruce Porperty $20,229 Ellin & Tucker, Chartered $18,000 Doreen Vitullo $17,434 Adams Burch $16,103 Balph, Nicolls, Mitsos, Flannery $10,135 & Clark Solex Trading GMBH $9,944 National City Complete Lease $9,647 Harold Import Co. $5,616 R. Campbell & Associates $4,809 Bel-Terr Decorating $4,741 Gary Felasco $4,634 Penna Power Company $4,472 Packer Thomas $3,650 Forlenza & Associates $3,638 Bruce & Merrilees $2,646 WORLDCOM/MCI: WCOEQ & MCWEQ Shares May be Cancelled by April 30 --------------------------------------------------------------- Parker & Waichman (http://www.worldcomstockfraud.com)announces that shares of MCI WorldCom (WCOEQ, MCWEQ & MCIAV) trading under the symbols (Nasdaq:WCOEQ) and (Nasdaq:MCWEQ) will likely be cancelled before April 30, 2004. The anticipated delay in the cancellation of these shares is a result of MCI WorldCom filing a request with the U.S. Bankruptcy Court for a 60 day extension. MCI WorldCom's previous deadline to emerge from bankruptcy was February 28, 2004. When MCI WorldCom emerges from bankruptcy it is likely that the shares of WCOEQ and MCWEQ will be cancelled and new shares of the company will be issued, leaving existing shareholders with stock of little or no value. These "new" shares are currently trading on a "when issued" basis under the symbol MCIAV. MCI WorldCom shareholders can request a free lawsuit case evaluation at http://www.worldcomstockfraud.com/and http://www.worldcomemployeelawsuit.com/ Parker & Waichman is currently representing over 2,000 current and former MCI and WorldCom shareholders. These retained clients consist of Salomon Smith Barney clients who purchased shares of WorldCom or MCI securities, current and former WorldCom or MCI employees and clients of any brokerage firm that lost at least $300,000 on WorldCom or MCI securities. Many of these clients qualified as members of the WorldCom class action lawsuit but have decided to opt-out of that lawsuit to pursue individual claims. Parker & Waichman continues to offer free lawsuit case evaluations at: http://www.worldcomstockfraud.comand http://www.worldcomemployeelawsuit.com. Parker & Waichman continues to believe that many current and former WorldCom and MCI shareholders may be better served by opting-out of the WorldCom class action lawsuit to pursue individual claims. Current and former WorldCom and MCI shareholders and employees can visit http://www.worldcomstockfraud.comand http://www.worldcomclassaction.comto view and download the WorldCom class action opt-out form, "Notice of Class Action." Current and former WorldCom and MCI shareholders who do not specifically opt-out of the class action by filing the required form or information are automatically included in the class action lawsuit. For more information on Parker & Waichman, LLP please visit: http://www.yourlawyer.comor call 1-800-LAW-INFO. Current and former shareholders are also encouraged to visit: http://www.injurytalk.com WR GRACE: Seeks to Extend Plan-Filing Exclusivity to Aug. 1, 2004 ----------------------------------------------------------------- W.R. Grace & Co. and its debtor-affiliates ask Judge Fitzgerald to extend their exclusive periods to file a plan of reorganization through August 1, 2004 and to solicit acceptances of that plan through October 1, 2004. David W. Carickhoff, Esq., at Pachulski Stang Ziehl Young & Jones, reminds the Court that these Chapter 11 cases were filed as a result of mounting asbestos-related litigation liabilities rather than as a result of difficulties with the Debtors' core businesses. Defining these liabilities, then providing for payment of valid claims on a basis that preserves the Debtors' core business operations is a complex process. Given its nature, this process could require significant litigation, which will take time. Considering the strength of their core businesses, the Debtors contend that they will be able to file a viable plan of reorganization in due course as the procedures for addressing the asbestos-related claims unfold. Amid intense opposition from the Asbestos Committees over the process to be employed, the Debtors have put into place a case management schedule that will establish a system to efficiently manage the adjudication of the myriad of asbestos-related claims against their estates. A further extension of the Debtors' exclusive periods will not harm creditors and other parties-in-interest, Mr. Carickhoff assures the Court. Indeed, Mr. Carickhoff says, termination of the exclusive periods would defeat the very purpose behind Section 1121 of the Bankruptcy Code, which is to afford the Debtors a meaningful and reasonable opportunity to negotiate with their creditors and to then propose and confirm a consensual plan of reorganization. Mr. Carickhoff contends that termination of the exclusive periods would signal a loss of confidence in the Debtors and their reorganization efforts. "The Debtors' core businesses would deteriorate, value would evaporate, and everybody would lose," Mr. Carickhoff says. Mr. Carickhoff notes that extensions of the exclusive periods are typical in multi-billion-dollar Chapter 11 cases in Delaware, like In re Harnischfeger Industries, Inc., Bankr. Case No. 99- 2171 (PJW) (multiple extensions totaling 20 months); In re Loewen Group Int'l, Inc., Bankr. Case. No. 99-1244 (PJW) (exclusive periods extended for 19 months); In re Montgomery Ward Holding Corp., Bankr. Case No. 97-1409 (PJW) (exclusive periods extended for 21 months); and In re Trans World Airlines, Inc., Bankr. Case No. 02-115 (HSB) (exclusivity extended for 20 months). Mr. Carickhoff further relates that the uncertainty surrounding the controversy over Judge Wolin's participation in these cases have had an effect on the Debtors' ability to file a plan. The Debtors have worked diligently in conjunction with a number of constituencies in these Chapter 11 cases to advance the Chapter 11 cases, and, as a result, substantial progress has been made in establishing a framework within which to resolve the Actions and various other claims against the Debtors. There have been a number of developments that have impeded the Debtors' progress toward establishing the framework to deal with asbestos-related Personal Injury Claims against the Debtors. Moreover, the "Science Trial" regarding factual questions about the scientific risks of Zonolite Attic Insulation remains to be completed. The "Science Trial" was scheduled to commence on February 9, 2004, but was cancelled. The parties continue settlement negotiations in an effort to resolve the issues; however, at present, the ZAI issues remain unresolved. The Debtors and their professionals are in the process of reviewing the filed claims and preparing claims objections. A Personal Injury Claims bar date, however, has yet to be set, and other related issues raised by the Debtors' case management motions also remain unresolved. The Debtors and other constituents have briefed Judge Wolin on how best to resolve the Personal Injury Claims and the procedures for doing so. Mr. Carickhoff also relates that the parties in the fraudulent transfer action filed by the official asbestos committees against Sealed Air Corporation in these Chapter 11 cases have reached a settlement. The Debtors are continuing to negotiate with the other parties not included in the settlement; however, Judge Wolin also has jurisdiction over the fraudulent transfer action. Therefore, approval of the settlement might also be delayed until the recusal issue is finally resolved. * * * Judge Fitzgerald will convene a hearing on March 22, 2004 to consider the Debtors' request. By application of Del.Bankr.L.R. 9006-2, the Debtors' exclusive period to file a plan of reorganization is automatically extended through the conclusion of that hearing. (W.R. Grace Bankruptcy News, Issue No. 55; Bankruptcy Creditors' Service, Inc., 215/945-7000) * Large Companies with Insolvent Balance Sheets ----------------------------------------------- Total Shareholders Total Working Equity Assets Capital Company Ticker ($MM) ($MM) ($MM) ------- ------ ------------ ------- -------- Alliance Imaging AIQ (39) 683 43 Akamai Technologies AKAM (168) 230 60 AK Steel Holdings AKS (53) 5,025 579 Alaris Medical AMI (32) 586 173 Amazon.com AMZN (1,036) 2,162 568 Aphton Corp APHT (11) 16 (5) Arbitron Inc. ARB (100) 156 (2) Alliance Resource ARLP (46) 288 (16) Atari Inc. ATAR (97) 232 (92) Actuant Corp ATU (7) 361 31 Avon Products AVP (91) 3,327 73 Blount International BLT (369) 428 91 Cincinnati Bell CBB (2,104) 1,467 (327) Cubist Pharmaceuticals CBST (7) 221 131 Cedara Software CDE (2) 20 (12) Choice Hotels CHH (114) 314 (37) Compass Minerals CMP (90) 644 101 Columbia Laboratories COB (8) 13 5 Caraco Pharm Labs CPD (20) 20 (2) Centennial Comm CYCL (579) 1,447 (98) Diagnostic Imag DIAM 0 20 (3) Echostar Comm DISH (1,206) 6,210 1,674 Deluxe Corp DLX (298) 563 (309) D&B Corp DNB (19) 1,528 (104) Education Lending Group EDLG (26) 1,481 N.A. Eyetech Pharma EYET (78) 76 62 First Potomac FPO (1) 126 N.A. WR Grace & Co. GRA (222) 2,688 587 Graftech International GTI (351) 859 108 Integrated Alarm IASG (11) 46 (8) Imax Corporation IMAX (104) 243 31 Imclone Systems IMCL (186) 484 139 Inkine Pharm INKP (6) 14 5 Gartner Inc. IT (29) 827 1 Journal Register JRC (4) 702 (20) KCS Energy KCS (30) 268 (16) Kos Pharmaceuticals KOSP (75) 69 (55) Lodgenet Entertainment LNET (101) 298 (5) Lucent Technologies LU (3,371) 15,747 2,818 Memberworks Inc. MBRS (21) 281 (100) Moody's Corp. MCO (327) 631 (190) McDermott International MDR (417) 1,278 154 McMoRan Exploration MMR (31) 72 5 Maguire Properti MPG (159) 622 N.A. Nuvelo Inc. NUVO (4) 27 21 Northwest Airlines NWAC (1,483) 13,289 (762) ON Semiconductor ONNN (498) 1,144 201 Petco Animal PETC (11) 555 113 Primus Telecomm PRTL (168) 724 65 Per-Se Tech Inc. PSTI (21) 171 (1) Qwest Communications Q (2,830) 29,345 (475) Quality Distribution QLTY (126) 387 19 Rite Aid Corp RAD (93) 6,133 1,676 Ribapharm Inc RNA (363) 199 92 Sepracor Inc SEPR (619) 1,020 728 Silicon Graphics SGI (165) 650 1 Sigmatel Inc. SGTL (4) 18 (1) St. John Knits Int'l SJKI (65) 234 69 I-Stat Corporation STAT 0 64 33 Syntroleum Corp. SYNM (1) 47 14 Town and Country Trust TCT (2) 504 N.A. Tenneco Automotive TEN (75) 2,504 (50) Thermadyne Holdings THMD (665) 297 139 TiVo Inc. TIVO (25) 82 1 Triton PCS Holdings TPC (60) 1,618 173 Tessera Technologies TSRA (74) 24 20 UnitedGlobalCom UCOMA (3,040) 5,931 (6,287) United Defense I UDI (30) 1,454 (27) Ultimate Software ULTI (7) 31 (10) Universal Technical UTI (36) 84 29 Valassis Comm. VCI (33) 386 80 Valence Tech VLNC (17) 36 4 Ventas Inc. VTR (54) 895 N.A. Warnaco Group WRNC (1,856) 948 471 Western Wireless WWCA (464) 2,399 (120) Xoma Ltd. XOMA (11) 72 30 ********* 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. 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., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland USA. Yvonne L. Metzler, Bernadette C. de Roda, Donnabel C. Salcedo, Aileen M. Quijano and Peter A. Chapman, Editors. Copyright 2004. 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. 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