/raid1/www/Hosts/bankrupt/TCR_Public/051123.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Wednesday, November 23, 2005, Vol. 9, No. 278
Headlines
21ST CENTURY TECH: Hires Gordon & Silver as Bankruptcy Counsel
21ST CENTURY TECH: De Joya Griffith Approved as Accountants
ACCESS WORLDWIDE: Sept. 30 Balance Sheet Upside-Down by $3.6 Mil.
ADELPHIA COMMS: Arahova Panel Wants Withheld Documents Produced
ADELPHIA COMMS: Court Approves Protocol for Setting Plan Reserves
ADELPHIA COMMS: Files Fourth Amended Joint Plan of Reorganization
AEARO CO: Earns $27.6 Million of Net Income in Fiscal Year 2005
ALAMOSA HOLDINGS: Sprint Buy-Out Prompts S&P to Review Ratings
ALLIANCE ONE: Poor Performance Spurs S&P to Pare Ratings to B+
ALLSERVE SYSTEMS: Wants Teich Groh as Bankruptcy Counsel
AMERICAN ENERGY: Sept. 30 Balance Sheet Upside-Down by $618,777
AMF BOWLING: Incurs $20.5 Million Net Loss in First Quarter 2006
AMKOR TECHNOLOGY: Completes Sale of $100 Mil. Convertible Notes
ANIMAL PRODUCTIONS: Case Summary & 14 Largest Unsecured Creditors
APCO LIQUIDATING: Wants Until February 15 to Remove Civil Actions
ATA AIRLINES: Ratifies Agreement with Flight Attendants
AUBURN FOUNDRY: Trustee Employs Rothberg Logan as Special Counsel
AUSTIN COMPANY: Panel Taps Schottenstein Zox as Chapter 11 Counsel
BANCO RURAL: Moody's Withdraws $500 Million Notes' B2 Rating
BEARD COMPANY: Sept. 30 Balance Sheet Upside-Down by $5.2 Million
BEAZER HOMES: Buying Back 10 Million Shares for Up to $250 Million
BRILLIANT DIGITAL: Incurs $627K Net Loss in Quarter Ended Sept. 30
BONUS STORES: Court Extends Claims Objection Deadline to Feb. 13
BROOKLYN HOSPITAL: Outlines Procedures for Lien Claimant Payments
CABLEVISION SYSTEMS: Rejects $700 Million Offer for Sports Teams
CAMBEX CORP: Balance Sheet Upside-Down by $3.7 Million at Oct. 1
CAPROCK HOLDINGS: Moody's Rates $36 Million Sr. Sec. Loan at B3
CATHOLIC CHURCH: Court Okays Traxi as Spokane's Financial Advisor
CATHOLIC CHURCH: Spokane Wants to Retain GVA Kidder as Consultant
CENTRAL VERMONT: Selling Catamount Energy Unit to Diamond Castle
CENTURY/ML CABLE: Wants Until February 13 to File Final Report
CHARTER COMMS: Selling 122.8 Million Shares via Public Offering
CHARTER COMMS: Sept. 30 Balance Sheet Upside-Down by $5 Billion
CLAREMONT TECHNOLOGIES: Hires Matthew Johnson as Chap. 11 Counsel
CORNERSTONE PRODUCTS: Court Okays Interim Use of Cash Collateral
DANA CORPORATION: Bank Group Extends Reporting Default Waiver
DELPHI CORP: Union Coalition Rejects 24,000 Job Reductions
DEUTSCHE ALT-A: Moody's Rates Class B-2 Sub. Certificates at Ba2
DIGITAL LIGHTWAVE: Sept. 30 Equity Deficit Widens to $44.7 Million
DRUGMAX INC: Names Three Appointees to Senior Management Team
EMERITUS ASSISTED: $26.62 Mil. of Convertible Sub. Notes Tendered
EMERITUS ASSISTED: Reports $134 Mil. Equity Deficit at Sept. 30
ENRON CORP: SK Corp. Withdraws Claims Following Stock Purchase
EXCELLIGENCE LEARNING: Nasdaq Extends Filing Deadline to Dec. 30
FEDDERS CORP: Sells Thermal Management Biz to Laird for $17.4 Mil.
FOAMEX INT'L: Lowenstein Sandler Approved as Committee's Counsel
FOAMEX INT'L: Panel Taps Jefferies & Company as Financial Advisor
FOAMEX INT'L: Saul Ewing Approved as Committee's Local Counsel
FREDERICK MCNEARY: Argues Chapter 11 Trustee Unnecessary
GE COMMERCIAL: S&P Places Low-B Ratings on $57.3-Mil Cert. Classes
GENERAL MOTORS: Reduction Plans Prompt S&P to Review Ratings
GENERAL MOTORS: Moody's Affirms Corporate Family Rating at B1
GRAHAM PACKAGING: Delivers Amended Financial Statements to SEC
HINES HORTICULTURE: Low Performance Cues S&P to Shave Debt Ratings
HYDROCHEM INDUSTRIAL: S&P Affirms B Corporate Credit Rating
INFRASOURCE INC: Moody's Affirms $169 Million Debts' Ba3 Ratings
INTERACTIVE MOTORSPORTS: Sept. 30 Equity Deficit Tops $1.9 Million
INTERLIANT: Panel Wants Another Delay in Entry of Final Decree
INTERSTATE BAKERIES: Court Okays Fairfax Property Sale for $3.35MM
INTERSTATE BAKERIES: Court Okays Northwest Area Consolidation
JEROME-DUNCAN: Files First Amended Plan and Disclosure Statement
LANTIS EYEWEAR: Has Until February 1 to Object to Claims
LEVITZ HOME: Can Continue Postpetition Intercompany Transactions
LEVITZ HOME: Court Okays Continued Use of Existing Business Forms
LEVITZ HOME: Wants to Reject Nine Store Lease Agreements
LORAL SPACE: Emerges from Chapter 11 with $180 Million in Cash
MAFCO WORLDWIDE: S&P Rates Proposed $125-Mil Sr. Sec. Loans at B+
MARKWEST ENERGY: S&P Chips Rating on $225MM Sr. Unsec. Debt to B-
MIRANT: Court Allows Dismissal of MAEM Inverse Condemnation Case
MIRANT CORP: Wants Court Okay on PEPCO Indemnification Settlement
MIRANT CORP: MAEM Wants to Sell 25,728 NRG Shares in Open Market
MOLECULAR DIAGNOSTICS: Sept. 30 Balance Sheet Upside-Down by $10MM
NETWORK COMMS: S&P Places B- Rating on $175 Million Senior Notes
NETWORK INSTALLATION: Stockholders Equity Soars by $8.6 Million
NEWS CORP: Moody's Raises Pref. Shares' Rating to Baa3 from Ba1
NORTHWEST AIRLINES: Court Approves ATSA, NAMA & TWU Labor Pacts
NORTHWEST AIRLINES: Court Approves ALPA & APFAA Interim Pacts
NORTHWEST AIRLINES: $10,000,000 Asset Sales Deemed De Minimis
OMEGA HEALTHCARE: Closes Public Offering of 5,175,000 Common Stock
O'SULLIVAN IND: Wants Lease Decision Period Stretched to Apr. 12
O'SULLIVAN INDUSTRIES: Bankruptcy Cues Moody's to Withdraw Ratings
OWENS CORNING: Asks Court to Allow Loans with Chinese Subsidiaries
OWENS CORNING: Court Allows Exterior Unit to Buy Assets for $14MM
OWENS CORNING: Gets Court Approval on Aircraft Sale Procedures
PACIFIC BAY: Fitch Affirms BB- Rating on $17-Mil Preference Shares
PEMMA CORPORATION: Case Summary & 26 Largest Unsecured Creditors
PIEDMONT MUTUAL: A.M. Best Says Financial Strength Is Weak
PHILLIPS-VAN HEUSEN: Earns $40.3MM of Net Income in Third Quarter
PRESTWICK CHASE: McNeary Says Chapter 11 Trustee Unnecessary
PROTECTION ONE: Posts $3 Mil. Net Loss in 3rd Qtr. Ended Sept. 30
PROTOCOL SERVICES: Panel Hires Higgs Fletcher as Chap. 11 Counsel
REINHOLD INDUSTRIES: Completes Sale of NP Aerospace for $53.4 Mil.
REMINGTON ARMS: Raw Material Costs Cue S&P to Junk Credit Rating
RESIDENTIAL ASSET: Moody's Rates Class B-7 Certificates at Ba2
REUNION INDUSTRIES: Sept. 30 Balance Sheet Upside Down by $24 Mil.
SAINT VINCENTS: Settles Insurance Controversy with A.I. Credit
SAINT VINCENTS: Court Allows Access to $35 Mil. Commerce Bank Loan
SAKS INC: Moody's Confirms B2 Corporate Family & Sr. Debt Ratings
SBA COMMUNICATIONS: Completes Offering of $405 Million Certs.
SFX ENT: S&P Assigns B+ Rating on Proposed $575-Mil Secured Loans
SPX CORP: Enters Into New $1.625 Billion Senior Secured Facilities
SKILLED HEALTHCARE: Moody's Rates $200 Mil. Sub. Notes at (P)Caa1
STONE ENERGY: Bank Group Grants Waiver and Amends Borrowing Base
SOUTHERN GROUP: A.M. Best Says Financial Strength Is Poor
TARGUS GROUP: S&P Junks Rating on $85 Million First Lien Facility
THERMA-WAVE INC: Issuing $10.4 Mil. Shares Via Private Placement
TITAN CRUISE: Wants Until January 31 to File Chapter 11 Plan
TRONOX WORLDWIDE: Fitch Places B+ Rating on $350MM Sr. Unsec. Debt
TRUMP ENT: Appoints Dale Black as EVP and Chief Financial Officer
UAL CORP: 56 Former Employees Hold $280,000 Allowed Unsec. Claims
URANIUM RESOURCES: Balance Sheet Upside-Down by $16MM at Sept. 30
USG CORP: Futures Rep. Gets Court Nod to Hire M. Crames as Advisor
USG CORP: Wants Adversary Case vs. PI Panel & Trafelet Continued
VELOCITA CORP: Claims Objection Bar Date Extended to April 30
VERIDICOM INT'L: Incurs $1.6MM Net Loss in Quarter Ended Sept. 30
* Sheppard Mullin Names Rick Chessen as Washington Partner
* Upcoming Meetings, Conferences and Seminars
*********
21ST CENTURY TECH: Hires Gordon & Silver as Bankruptcy Counsel
--------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Nevada gave 21st
Century Technologies, Inc., permission to employ Gordon & Silver,
Ltd., as its general bankruptcy counsel.
Gordon & Silver will:
1) prepare the Debtor's schedules, statements of financial
affairs, applications, reports and other papers required by
the Court in its chapter 11 case;
2) advise the Debtor of its rights, obligations and the
performance of its duties in the administration of its
chapter 11 case;
3) assist the Debtor in formulating a plan of reorganization
and a disclosure statement and obtain approval of that
disclosure statement and confirmation of that plan;
4) represent the Debtor in all proceedings before the
Bankruptcy Court and other courts with jurisdiction over the
Debtor's chapter 11 case; and
5) render all other legal services to the Debtor that are
necessary in its bankruptcy case.
William M. Noall, Esq., a shareholder of Gordon & Silver, is one
of the lead attorneys for the Debtor. Mr. Noall discloses that
his Firm received a $100,000 retainer.
Mr. Noall reports Gordon & Silver's professionals bill:
Designation Hourly Rate
----------- -----------
Shareholders $350 - $510
Associates $150 - $325
Paralegals $120
Gordon & Silver assures the Court that it does not represent any
interest materially adverse to the Debtor and is a disinterested
person as that term is defined in Section 101(14) of the
Bankruptcy Code.
Headquartered in Las Vegas, Nevada, 21st Century Technologies,
Inc. -- http://www.tfctcorp.com/-- provides long-term debt and
equity investment capital to support the expansion of companies
in a variety of industries. The Company filed for chapter 11
protection on Nov. 1, 2005 (Bankr. D. Nev. Case No. 05-28185).
When the Debtor filed for protection from its creditors, it listed
total assets of $13,489,476 and total debts of $2,005,224.
21ST CENTURY TECH: De Joya Griffith Approved as Accountants
-----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Nevada gave
21st Century Technologies, Inc., permission to employ De Joya
Griffith & Company, LLC, as its accountants.
De Joya will:
a) audit the Debtor's balance sheet as of December 31, 2004 and
2003, and the related statements of operation, stockholders'
equity and cash flows for those years ended;
b) prepare the Debtor's federal income tax returns; and
c) provide all other accounting, tax advisory and consulting
services to the Debtor that are necessary in its chapter 11
case.
Jason F. Griffith, C.P.A., a shareholder of De Joya, discloses
that his Firm received a $10,000 retainer.
Mr. Griffith reports De Joya's professionals bill:
Designation Hourly Rate
----------- -----------
Partners $175 - $250
Senior Managers $125 - $175
Staff Accountants $100 - $125
Support Staff $75
De Joya assures the Court that it does not represent any interest
materially adverse to the Debtor and is a disinterested person as
that term is defined in Section 101(14) of the Bankruptcy Code.
Headquartered in Las Vegas, Nevada, 21st Century Technologies,
Inc. -- http://www.tfctcorp.com/-- provides long-term debt and
equity investment capital to support the expansion of companies
in a variety of industries. The Company filed for chapter 11
protection on Nov. 1, 2005 (Bankr. D. Nev. Case No. 05-28185).
William M. Noall, Esq., at Gordon & Silver, Ltd., represents the
Debtor in its restructuring efforts. When the Debtor filed for
protection from its creditors, it listed total assets of
$13,489,476 and total debts of $2,005,224.
ACCESS WORLDWIDE: Sept. 30 Balance Sheet Upside-Down by $3.6 Mil.
-----------------------------------------------------------------
Access Worldwide Communications, Inc. (OTC Bulletin Board: AWWC)
reported financial results for the quarter ended Sept. 30, 2005.
The company's revenues decreased $1.5 million, or 15.2%, to $8.4
million for the quarter ended Sept. 30, 2005, compared to $9.9
million for the quarter ended Sept. 30, 2004. The company
reported a loss from operations for the third quarter of 2005 of
$1.5 million, compared to a loss from operations of $600,000 for
the third quarter of 2004.
The company reported a net loss of $2.8 million for the quarter
ended Sept. 30, 2005, compared to net loss of $900,000 for the
quarter ended Sept. 30, 2004.
The overall decrease in revenues was primarily attributed to the
lead time necessary for the company's two new business development
professionals to replace the revenue lost from a prior client due
to regulatory changes in the Business Services segment. The
company is continuing to experience an increase in activity from
each of these individuals. The decrease was offset by the slight
increase in revenues in the company's Pharmaceutical Services
segment. The increase in net loss was attributed to the decrease
in revenues and a decrease in revenues at the medical education
business division. In addition, a deemed dividend related to
warrants issued to certain stockholders was recorded in the
quarter ended Sept. 30, 2005, at its fair value of $700,000, in
accordance with generally accepted accounting principles.
The company's revenues decreased $8.5 million, or 23.1%, to $28.3
million for the nine months ended Sept. 30, 2005, compared to
$36.8 million for the nine months ended Sept. 30, 2004. Revenues
for the Pharmaceutical Segment decreased $300,000, or 1.6%, to
$18.2 million for the nine months ended Sept. 30, 2005, compared
to $18.5 million for the nine months ended Sept. 30, 2004.
Revenues for the Business Segment decreased $8.2 million, or
44.8%, to $10.1 million for the nine months ended Sept. 30, 2005,
compared to $18.3 million for the nine months ended Sept. 30,
2004.
The company reported net loss of $4 million for the nine months
ended Sept. 30, 2005, compared to net loss and of $800,000 and for
the nine months ended Sept. 30, 2004.
"We continue to focus our efforts on improving revenue performance
at our other divisions and continue to review our selling, general
and administrative costs in light of our decreased revenues,"
stated Richard Lyew, the Company's Chief Financial Officer.
Founded in 1983, Access Worldwide Communications, Inc. --
http://www.accessww.com/-- provides a variety of sales, marketing
and medical education services. Among other things, the company
reaches physicians, pharmacists and patients on behalf of
pharmaceutical clients, educating them on new drugs, prescribing
indications, medical procedures and disease management programs.
Services include product stocking, medical education, database
management, clinical trial recruitment and teleservices. For
clients in the telecommunications, financial services, insurance
and consumer products industries, the company reaches the
established mainstream and growing multicultural markets with
multilingual teleservices. Access Worldwide is headquartered in
Boca Raton, Florida and has about 800 employees in offices
throughout the United States and Asia.
At Sept. 30, 2005, Access Worldwide Communications, Inc.'s balance
sheet showed a $3,625,027 stockholders' deficit compared to a
$3,865,118 deficit at Dec. 31, 2004.
ADELPHIA COMMS: Arahova Panel Wants Withheld Documents Produced
---------------------------------------------------------------
The Ad Hoc Committee of Arahova Noteholders in the chapter 11
cases of Adelphia Communications Corporation and its debtor-
affiliates, as holders of over $540,000,000 in senior notes issued
by Debtor Arahova Communications, Inc., asks the U.S. Bankruptcy
Court for the Southern District of New York to compel the ACOM
Debtors to produce certain material being withheld from production
on grounds of attorney-client privilege or work product doctrine.
According to Wayne A. Cross, Esq., at White & Case LLP, in New
York, the Arahova Committee timely served requests for the
production of documents and the depositions of knowledgeable
witnesses on counsel for current management controlled by ACOM
and certain third parties.
Throughout the expedited discovery schedule set by the Court, Mr.
Cross notes, the Arahova Committee diligently pursued their
requests to obtain needed information to represent its interests.
However, the Arahova Committee alleges that counsel at Willkie
Farr & Gallagher LLP and ACOM's management prevented it from
obtaining any information with respect to certain discovery that
is critical to many of the issues to be decided by the Court.
"Willkie and [ACOM's] Management have done so on the basis of
vague and generalized privilege and work product claims without
basis in fact or law," Mr. Cross asserts.
The withheld information include:
-- certain (as yet unidentified) documents responsive to the
Arahova Committee's document requests;
-- certain testimony by knowledgeable ACOM employees and its
affiliated Debtors in response to requests made during
depositions; and
-- documents prepared and received by PricewaterhouseCoopers
LLP in connection with forensic accounting services
performed on behalf of the ACOM Debtors, including the
Arahova Debtors.
Willkie and ACOM's Management have failed to provide a privilege
log or any detailed explanation for their privilege
claims, the Arahova Committee points out.
Mr. Cross argues that to the extent the material even is
privileged in the first place, it cannot be privileged as to the
Arahova Debtors, on whose behalf the material was prepared. Nor
can it be privileged as to the Arahova Noteholders Committee,
which is representing the interests of the Arahova estate.
Thus, the Arahova Committee concludes, the Court must compel the
ACOM Debtors to produce the material improperly withheld by
Willkie and ACOM's Management.
The Arahova Committee further seeks Judge Gerber's permission to
file its motion under seal.
Mr. Cross explains that the Motion contains information and
deposition testimony that the parties have contended are
"Confidential Discovery Material" pursuant to the Confidentiality
Stipulation and Protective Order that was approved by the
participants in the Inter-Debtor dispute resolution
process. Moreover, the information and testimony contain
sensitive financial and proprietary information that has not been
publicly disclosed either in the course of ACOM's chapter 11
cases or to any governmental agency. The disclosure of the
Confidential Discovery Material at this time could cause
competitive harm to the Debtors or any party-in-interest in
ACOM's cases, Mr. Cross says.
Headquartered in Coudersport, Pennsylvania, Adelphia
Communications Corporation (OTC: ADELQ) is the fifth-largest cable
television company in the country. Adelphia serves customers in
30 states and Puerto Rico, and offers analog and digital video
services, high-speed Internet access and other advanced services
over its broadband networks. The Company and its more than
200 affiliates filed for Chapter 11 protection in the Southern
District of New York on June 25, 2002. Those cases are jointly
administered under case number 02-41729. Willkie Farr & Gallagher
represents the ACOM Debtors. (Adelphia Bankruptcy News, Issue No.
114; Bankruptcy Creditors' Service, Inc., 215/945-7000)
ADELPHIA COMMS: Court Approves Protocol for Setting Plan Reserves
-----------------------------------------------------------------
Judge Gerber of the U.S. Bankruptcy Court for the Southern
District of New York approves the Adelphia Communications
Corporation and its debtor-affiliates' proposed procedures for
setting plan reserves and estimating individual disputed claims
with few modifications.
Judge Gerber rules that the proposed amount of each of the
funding company distribution reserve, the notes/trade
distribution reserve, the other unsecured distribution reserve
and the existing securities law claim reserve will be the sum of:
-- the aggregate amount of Allowed Claims in that class; plus
-- the aggregate amount of any Disputed Claims in that class
as to which, for reserve purposes only, the Debtor will
reserve the full face amount of the Disputed Claims; plus
-- the aggregate amount of postpetition interest payable on
account of the Allowed Claims and Disputed Claims; plus
-- the amount, if any, of Disputed Claims that are estimated
pursuant to the Estimation Procedures of Individual
Disputed Claims.
On or before the date that is 25 days prior to the Voting
Deadline, the Debtors may file a Notice of Estimation of Disputed
Claim setting forth the asserted amount of the claim and the
proposed maximum limitation on the claim for distribution
purposes.
The Court makes it clear that the Debtors will not file a Notice
of Estimation with respect to any Disputed Claim that, if
allowed, would be entitled to recovery exclusively from the
Contingent Value Vehicle, until the time as Distributable
Proceeds are available for distribution to that class in which
the Disputed Claim that the Debtors seek to estimate would
belong.
Furthermore, the Debtors will not file a Notice of Estimation of
Disputed Claim with respect to the non-contingent, liquidated
components of the claims against Adelphia Communications
Corporation filed by:
-- SG Cowen & Co.;
-- Harris Nesbitt Corp.;
-- Credit Suisse First Boston (USA), Inc.;
-- The Royal Bank of Scotland PLC;
-- Calyon Securities (USA) Inc.;
-- LCM I Limited Partnership;
-- Indosuez Capital Funding IIA, Ltd.;
-- ABN AMRO Securities LLC;
-- Banc of America Securities LLC;
-- BNY Capital Markets, Inc.;
-- Barclays Capital Inc.;
-- Citigroup Financial Products, Inc.;
-- Citigroup Global Markets Holdings, Inc.;
-- CIBC World Markets Corp.;
-- Deutsche Bank Alex Brown, Inc.;
-- ADP Clearing & Outsourcing Services, Inc.;
-- Morgan Stanley & Co. Incorporated;
-- PNC Capital Markets, Inc.;
-- Scotia Capital (USA) Inc.;
-- SunTrust Securities, Inc.; and
-- TD Securities (USA) Inc.
The Debtors reserve their rights to object to the allowance of
the claims on all grounds.
The Objections to the Motion are either withdrawn, resolved or
overruled by the Court.
Headquartered in Coudersport, Pennsylvania, Adelphia
Communications Corporation (OTC: ADELQ) is the fifth-largest cable
television company in the country. Adelphia serves customers in
30 states and Puerto Rico, and offers analog and digital video
services, high-speed Internet access and other advanced services
over its broadband networks. The Company and its more than
200 affiliates filed for Chapter 11 protection in the Southern
District of New York on June 25, 2002. Those cases are jointly
administered under case number 02-41729. Willkie Farr & Gallagher
represents the ACOM Debtors. (Adelphia Bankruptcy News, Issue No.
115; Bankruptcy Creditors' Service, Inc., 215/945-7000)
ADELPHIA COMMS: Files Fourth Amended Joint Plan of Reorganization
-----------------------------------------------------------------
Adelphia Communications Corporation (OTC:ADELQ) filed a fourth
amended plan of reorganization with the U.S. Bankruptcy Court for
the Southern District of New York together with a related amended
disclosure statement.
These filings represent the company's additional responses and
proposed resolutions to the objections that had been filed to
approval of the company's disclosure statement. The hearing to
consider approval of the disclosure statement commenced on
October 27, 2005. The company expects to supplement this filing
with additional information about ranges of potential recoveries
based on discussions with constituents.
On April 21, 2005, Adelphia announced that it had reached
definitive agreements for Time Warner Inc. (NYSE:TWX) and Comcast
Corporation (Nasdaq: CMCSA, CMCSK) to acquire substantially all
the U.S. assets of Adelphia for $12.7 billion in cash and 16
percent of the common stock of Time Warner's cable subsidiary,
Time Warner Cable Inc.
A full-text copy of the Fourth Amended Plan of Reorganization is
available for free at http://ResearchArchives.com/t/s?31a
A full-text copy of the Fourth Amended Disclosure Statement is
available for free at http://ResearchArchives.com/t/s?31b
Headquartered in Coudersport, Pennsylvania, Adelphia
Communications Corporation (OTC: ADELQ) is the fifth-largest cable
television company in the country. Adelphia serves customers in
30 states and Puerto Rico, and offers analog and digital video
services, high-speed Internet access and other advanced services
over its broadband networks. The Company and its more than
200 affiliates filed for Chapter 11 protection in the Southern
District of New York on June 25, 2002. Those cases are jointly
administered under case number 02-41729. Willkie Farr & Gallagher
represents the ACOM Debtors.
AEARO CO: Earns $27.6 Million of Net Income in Fiscal Year 2005
---------------------------------------------------------------
For the year ended Sept. 30, 2005, Aearo Company I reported net
sales increased $60.6 million, or 16.7%, to $423.4 million from
$362.8 million a year earlier.
Adjusted EBITDA increased 25% to $77.8 million for the year
ended Sept. 30, 2005 from $62.2 million for the year ended
Sept. 30, 2004.
Net income for the year ended Sept. 30, 2005 increased to
$27.6 million from $3.5 million for the year ended Sept. 30, 2004.
This performance represents the best fiscal year for sales and
earnings in the company's history.
The increase in net sales was primarily driven by organic growth
in the Safety Products and Specialty Composites segments and
foreign currency translation. The weakness of the U.S. dollar
favorably impacted net sales by $7.7 million or 2.1%.
Gross profit for the year ended Sept. 30, 2005 increased 33.1% to
$206.7 million from $155.3 million for the year ended Sept. 30,
2004. Gross profit for 2004 was adversely affected by a
non-recurring charge of $17.1 million resulting from the write-up
of inventory required by SFAS No. 141 on the merger date and
subsequent sale of such inventory. Gross profit as a percentage
of sales for the year ended Sept. 30, 2005 was 48.8% as compared
to 47.5% for the year ended Sept. 30, 2004 with fiscal year 2004
calculated by excluding the effects of the purchase accounting
adjustment.
The provision for income taxes for the year ended Sept. 30, 2005
was $11.2 million compared to $1 million for the year ended Sept.
30, 2004. The effective tax rate for the year ended Sept. 30,
2005 and 2004 was different from the statutory rate due to the mix
of income between the Company's foreign and domestic subsidiaries.
The company's foreign subsidiaries had taxable income in their
foreign jurisdictions while the Company's domestic subsidiaries
have net operating loss carry-forwards for income tax purposes.
Headquartered in Indianapolis, Indiana, Aearo Company --
http://www.aearo.com/-- is one of the world's leading designers,
manufacturers and marketers of a broad range of personal
protective products and energy-absorbing products, including head
and hearing protection devices, prescription and non-prescription
eyewear, and eye/face protection devices for use in a wide variety
of industrial and household applications.
* * *
As reported in the Troubled Company Reporter on Aug. 17, 2005,
Moody's Investors Service has affirmed the ratings of Aearo
Company, in response to its announcement that its parent company,
Aearo Corporation, has issued $54 million of senior unsecured PIK
notes to fund a distribution to Holdco's shareholders. The rating
outlook remains stable.
Ratings affirmed:
* B1 for the $50 million senior secured revolver, due 2010;
* B1 for the $123.8 million senior secured term loan, due 2011;
* B3 for the $175 million of 8.25% senior subordinated notes,
due 2012; and
* B1 corporate family rating.
ALAMOSA HOLDINGS: Sprint Buy-Out Prompts S&P to Review Ratings
--------------------------------------------------------------
Standard & Poor's Rating Services placed its ratings for Lubbock,
Texas-based wireless carrier Alamosa Holdings Inc. and all
subsidiaries, including Alamosa Delaware Inc. and AirGate PCS
Inc., on CreditWatch with positive implications.
This action follows today's announcement that Sprint Nextel Corp.
(A-/Stable/--) has agreed to purchase Alamosa, its largest Sprint
PCS wireless affiliate, for about $3.2 billion cash plus the
assumption of approximately $1.1 billion of debt. Absent
guarantees from Sprint Nextel, the corporate credit rating likely
would be raised to 'BBB-' from 'B-'.
"The ratings on Sprint Nextel are affirmed, as the potential
acquisition of some or all of the Sprint affiliates already had
been factored into the 'A-' corporate credit rating," said
Standard & Poor's credit analyst Eric Geil. The acquisition is
subject to the approval of Alamosa shareholders and customary
regulatory approvals, and is expected to be completed in the first
quarter of 2006. Alamosa provides wireless services under the
Sprint brand to about 1.5 million subscribers in 19 states with
total of 19.9 million covered population equivalents.
ALLIANCE ONE: Poor Performance Spurs S&P to Pare Ratings to B+
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on leaf
tobacco dealer Alliance One International Inc. and its wholly
owned subsidiary, Intabex Netherlands B.V., including its
corporate credit rating to 'B+' from 'BB-'.
The ratings were removed from CreditWatch where they were placed
on Oct. 25, 2005, with negative implications. The outlook is
negative. Total rated debt on Morrisville, North Carolina-based
Alliance One is about $1.5 billion.
The downgrade reflects:
* the decline in operating performance and
* the related effect on credit protection measures.
These factors are due to:
* the poor quality of the Brazilian crop and
* Standard & Poor's expectation that financial measures will
not improve to levels appropriate for the ratings in the
near term.
Standard & Poor's expects that the company will receive an
amendment by its senior lenders that will loosen its financial
covenants in the near term. Although Alliance One is ahead of
schedule in achieving the cost savings from the May 2005 merger of
DIMON Inc. and Standard Commercial Corp., these savings were not
sufficient to offset the declines in operating profit.
ALLSERVE SYSTEMS: Wants Teich Groh as Bankruptcy Counsel
--------------------------------------------------------
Allserve Systems Corp. asks the Hon. Rosemary Gambardella of the
U.S. Bankruptcy Court for the for the District of New Jersey,
Newark Division, for permission to employ Teich Groh as its
bankruptcy counsel.
Teich Groh will provide all services necessary for a successful
reorganization or sale of the Debtor's assets.
Papers filed with the Court did not disclose Teich Groh's hourly
rates.
Barry W. Frost, Esq., a member at Teich Groh, assures the Court
that the Firm is disinterested as that term is defined in Section
101(14) of the U.S. Bankruptcy Code.
Founded in 1939, Teich Groh -- http://www.teichgroh.com/-- is a
full-service law firm that serves clients throughout the state of
New Jersey.
Headquartered in North Brunswick, New Jersey, Allserve Systems
Corp. is an outsourcing company for the IT industry. The Debtor
filed for chapter 11 protection on November 18, 2005 (Bankr. D.
N.J. Case No. 05-60401). When the Debtor filed for protection
from its creditors, it estimated assets between 10 million to $50
million and debts between $50 million to $100 million.
AMERICAN ENERGY: Sept. 30 Balance Sheet Upside-Down by $618,777
---------------------------------------------------------------
The American Energy Group, Ltd., delivered its annual report on
Form 10-QSB for the quarter ending Sept. 30, 2005, to the
Securities and Exchange Commission on Nov. 14, 2005.
The company reported no revenues and a $277,710 net loss for the
three months ending Sept. 30, 2005, compared to a $161,038 net
loss for the same period last year. At Sept. 30, 2005, the
company's balance sheet showed $618,777 stockholders deficit,
compared to a deficit of $559,781 at June 30, 2005.
A full-text copy of the regulatory filing is available at no
charge at http://ResearchArchives.com/t/s?313
Headquartered in Houston, Texas, The American Energy Group, Ltd.
was, until its bankruptcy in 2002, an independent oil and natural
gas company engaged in the exploration, development acquisition
and production of crude oil and natural gas properties in the
Texas gulf coast region of the United States and in the Jacobabad
area of the Republic of Pakistan. The company's creditors filed
an involuntary chapter 7 petition on June 28, 2002 (Bankr. S.D.
Tex. Case No. 02-37125). Leonard H. Simon, Esq., at Pendergraft &
Simon L.L.P represents the Debtor in its chapter 11 case. The
company converted the chapter 7 case to a chapter 11 proceeding
and confirmed a chapter 11 plan. That plan did not stop a secured
creditor from foreclosing on the company's Fort Bend County oil
and gas leases.
On April 14, 2005, The American Energy Operating Corp., an
inactive subsidiary of The American Energy Group, Ltd., filed a
voluntary Chapter 7 bankruptcy petition (Bankr. S.D. Tex. Case No.
05-35757).
AMF BOWLING: Incurs $20.5 Million Net Loss in First Quarter 2006
----------------------------------------------------------------
AMF Bowling Worldwide, Inc., delivered its quarterly report on
Form 10-Q for the quarter ending Oct. 2, 2005, to the Securities
and Exchange Commission on Nov. 16, 2005, reporting:
First Fiscal First Fiscal
Quarter 2006 Quarter 2005
------------ ------------
Consolidated operating revenue $122,743,000 $115,133,000
Operating loss ($15,800,000) ($16,700,000)
New loss ($20,500,000) ($12,900,000)
A full-text copy of the regulatory filing is available at no
charge at http://ResearchArchives.com/t/s?314
Headquartered in Richmond, Virginia, AMF Bowling Worldwide, Inc.
is the largest operator of bowling centers in the world with
roughly 370 centers.
AMF Bowling Worldwide, Inc., filed for chapter 11 protection
on July 3, 2001 (Bankr. E.D. Va. Case Nos. 01-61119 through
01-61143). Marc Abrams, Esq., at Willkie, Farr & Gallagher
represented the operating subsidiaries. The corporate parent,
AMF Bowling, Inc., filed for chapter 11 protection on July 31,
2001 (Bankr. E.D. Va. Case No. 01-61299). Lawrence H. Handelsman,
Esq., at Stroock & Stroock & Lavan LLP, represented the parent
company. The Debtors' Second Amended & Modified Chapter 11 Plan
was confirmed on Feb. 1, 2002, and consummated on March 8, 2002.
That plan deleveraged the company's balance sheet, and delivered a
92% equity stake in the reorganized subsidiaries to the company's
secured lenders and a 7% equity stake in the operation to
unsecured creditors. The old public parent company died.
* * *
As reported in the Troubled Company Reporter on July 19, 2005,
Moody's Investors Service downgraded the ratings of AMF Bowling
Worldwide, Inc., thus concluding the review of the ratings for
possible downgrade initiated on March 10, 2005.
These ratings were lowered:
-- To Caa1 from B3, $150 million 10% senior subordinated notes,
due 2010
-- To B2 from B1, approximately $120 million senior secured
credit facility consisting of a $40 million revolver,
maturing in 2009, and approximately $79 million term B
loans, maturing in 2009
-- To B2 from B1, Corporate Family Rating (formerly known as
the Senior Implied Rating)
Moody's said the ratings outlook is stable.
AMKOR TECHNOLOGY: Completes Sale of $100 Mil. Convertible Notes
---------------------------------------------------------------
Amkor Technology, Inc. (Nasdaq: AMKR) completed the sale of $100
million of convertible subordinated notes due 2013 to James J. Kim
and certain affiliated entities of James J. Kim in a private
placement.
The notes:
* bear interest at a rate of 6.25% per year,
* are convertible into Amkor's common stock at a conversion
price of $7.49 per share, and
* are subordinated to the prior payment in full of all of
Amkor's senior and senior subordinated debt.
Amkor intends to use the proceeds from the sale of these notes to
refinance a portion of its outstanding $233 million aggregate
principal amount of 5.75% Convertible Subordinated Notes due June
1, 2006 in a manner such that the notes constitute permitted
refinancing indebtedness under Amkor's outstanding senior and
senior subordinated notes indentures.
At the initial conversion price, each $1,000 principal amount of
notes is convertible into approximately 133.5113 shares of Amkor's
common stock. The initial conversion price represents a 30
percent premium on the average closing bid price per share of
Amkor's common stock as reported on the Nasdaq National Market for
the five trading day period ending on Nov. 11, 2005.
Amkor Technology, Inc., headquartered in Chandler, Arizona, is one
of the world's largest providers of contract semiconductor
assembly and test services for integrated semiconductor device
manufacturers as well as fabless semiconductor operators. For the
most recent FY2004, the company generated net sales of $1.9
billion.
* * *
As reported in the Troubled Company Reporter on Aug. 25, 2005,
Moody's Investors Service lowered the long term ratings and
speculative grade liquidity rating of Amkor Technology, and
maintains a negative rating outlook.
The downgrade of the long term debt ratings reflects concerns
about Amkor's ability to support its existing debt load at its
current operating performance levels. The burden of fixed
expenses and continued high capex levels make it challenging for
Amkor to generate positive cash flow without meaningful growth in
revenues and operating margin which has been absent so far.
Amkor's subordinated notes were downgraded by two notches, versus
one notch for other ratings, reflecting the magnifying of
debtholders' weaker recovery position relative to more senior
obligations as the company's overall credit profile deteriorates.
The downgrade of the liquidity rating to SGL-4, indicating weak
liquidity, specifically reflects concerns about Amkor's ability to
meet its $233 million debt maturity in June 2006 from existing
sources of funds or cash generation over the next 12 months.
These ratings were lowered:
* Corporate family rating (formerly Senior implied rating)
to B3 from B2;
* Senior unsecured debt rating to Caa1 from B3;
* Senior secured (2nd lien) term loan to B2 from B1;
* Subordinated notes lowered to Caa3 from Caa1; and
* Speculative grade liquidity rating lowered to SGL-4
from SGL-3.
The rating outlook remains negative.
ANIMAL PRODUCTIONS: Case Summary & 14 Largest Unsecured Creditors
-----------------------------------------------------------------
Lead Debtor: Animal Productions LLC
5890 West Jefferson Boulevard
Los Angeles, California 90016
Bankruptcy Case No.: 05-50055
Debtor affiliates filing separate chapter 11 petitions:
Entity Case No.
------ --------
Captured Productions Inc. 05-50056
Cinema Holdings Inc. 05-50057
Desperate Inc. 05-50058
Disorder Productions Inc. 05-50059
Lost Angels Distribution Inc. 05-50060
Type of Business: The Debtors are filmmakers and affiliates of
Franchise Pictures LLC. Franchise Pictures and
20 affiliates filed for chapter 11 protection on
Aug. 18, 2004 (Bankr. C.D. Calif. Case No.
04-27996 changed to 05-13855) with Judge Tighe
presiding.
Chapter 11 Petition Date: November 21, 2005
Court: Central District of California (San Fernando Valley)
Judge: Maureen Tighe
Debtors' Counsel: Susan H. Tregub, Esq.
17554 Weddington Street
Encino, California 91316
Tel: (818) 679-9278
Estimated Assets Estimated Debts
---------------- ---------------
Animal Productions LLC Less than $50,000 $1 Million to
$10 Million
Captured Productions Inc. Less than $50,000 $1 Million to
$10 Million
Cinema Holdings Inc. Less than $50,000 $1 Million to
$10 Million
Desperate Inc. Less than $50,000 $1 Million to
$10 Million
Disorder Productions Inc. Less than $50,000 $1 Million to
$10 Million
Lost Angels Distribution Inc. Less than $50,000 $1 Million to
$10 Million
Consolidated List of Debtors' 14 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
American Federation of Musicians Unknown
1501 Broadway, Suite 600
New York, NY 10036
B.A. Bay Inc. Profit Unknown
c/o William Morris Agency participation
1325 Avenue of the Americas payable
New York, NY 10019
Danny Trejo Unknown
c/o Amsel, Eisenstadt & Frazier
5757 Wilshire Boulevard, Suite 510
Los Angeles, CA 90036
Dark & Stormy Nights Productions Profit Unknown
c/o Creative Artists Agency participation
9830 Wilshire Boulevard payable
Beverly Hills, CA 90212
Edward Bunker Profit Unknown
c/o Windfall Management participation
4084 Mandeville Canyon Road payable
Los Angeles, CA 90049
Directors Guild of America, Inc. Unknown
7920 Sunset Boulevard
Los Angeles, CA 90046
E Group Services, Inc. Unknown
c/o Hans Turner
5890 West Jefferson Boulevard
Los Angeles, CA 90016
IATSE General Office Unknown
1430 Broadway, 20th Floor
New York, NY 10018
Mobius International, Inc. Unknown
5890 West Jefferson Boulevard
Los Angeles, CA 90016
New Moon Productions, Inc. Unknown
c/o Wyman, Issacs,
Blumenthal, et al.
8840 Wilshire Boulevard
Second Floor
Beverly Hills, CA 90212
R2D2, LLC Unknown
c/o David Bergstein
5890 West Jefferson Boulevard
Los Angeles, CA 90016
Screen Actors Guild Unknown
5757 Wilshire Boulevard
Los Angeles, CA 90036
Tre Saldo, Inc. Unknown
c/o Lichter, Grossman, Nichols
9200 Sunset Boulevard, Suite 530
West Hollywood, CA 90069
Writers Guild of America Unknown
West, Inc.
7000 West Third Street
Los Angeles, CA 90048
APCO LIQUIDATING: Wants Until February 15 to Remove Civil Actions
-----------------------------------------------------------------
APCO Liquidating Trust and APCO Missing Stockholder Trust ask the
U.S. Bankruptcy Court for the District of Delaware to extend until
February 15, 2006, their deadline to remove civil actions.
The Debtors are parties to multiple civil actions pending in
various courts throughout the United States. They decide to
analyze each of their civil action in light of these factors:
a) the importance of the proceeding to the expeditious
resolution of the Debtors' chapter 11 cases;
b) the time it would take to complete the proceeding in its
current value;
c) the presence of federal questions in the proceeding that
increase the likelihood that one or more aspects thereof
will be heard by a federal court;
d) the relationship between the proceeding and matters to be
considered in connection with any proposed plan in the
chapter 11 cases, the claims allowance process, and the
assumption or rejection of executory contracts; and
e) the progress made to date in the proceeding.
The Debtors believe that the extension period will give them
additional time needed to make fully informed decisions concerning
the removal of each civil action.
Headquartered in Oklahoma City, Oklahoma, APCO Liquidating Trust
and APCO Missing Stockholder Trust were created on behalf of the
common stockholders of APCO Oil Corporation. The Debtors filed
for chapter 11 protection on August 19, 2005 (Bankr. D. Del. Case
No. 05-12355). Gregory P. Williams, Esq., John Henry Knight,
Esq., and Rebecca L. Booth, Esq., at Richards, Layton & Finger,
P.A., represent the Debtors. When the Debtor filed for
protection, they estimated assets and debts between $10 million to
$50 million.
ATA AIRLINES: Ratifies Agreement with Flight Attendants
-------------------------------------------------------
ATA Airlines, Inc. (Pink Sheets:ATAHQ) reported that its flight
attendants, represented by the Association of Flight Attendants,
have voted to ratify a new collective bargaining agreement.
The new agreement will extend wage, benefit and work rule
concessions earlier ratified on Oct. 15, 2004, and will become
effective Jan. 1, 2006. The collective bargaining agreement will
be amendable on Oct. 31, 2008.
"Reaching this consensual agreement marks yet another significant
accomplishment in strengthening the airline's financial position
as we edge ever closer to successful emergence from Chapter 11,"
said ATA CEO and President John Denison. "By ratifying this
agreement, our flight attendants are demonstrating a faith in this
Company that has been displayed by so many of our employees during
this difficult restructuring period."
Senior Vice President of Employee Relations Richard Meyer agreed
with Denison. "[Yester]day's announcement is a true testament to
the outstanding cooperative efforts made by everyone involved in
the negotiations," added Mr. Meyer. "We appreciate our flight
attendants choosing to play a role in reducing the Company's
operating costs. With this decision, they are helping to create a
more robust and financially stable airline that can support a
better long-term future for all employees."
Concessions were already in effect through Oct. 15, 2006, under an
agreement between ATA and AFA signed in October of 2004. In early
August of 2005, negotiations resumed with the primary goal of
extending those concessions. On Nov. 7, 2005, ATA AFA Master
Executive Council members forwarded a tentative agreement to
flight attendants for voting on ratification. Yesterday's
announcement confirms their approval of that agreement.
The Association of Flight Attendants-CWA is the world's largest
labor union organized by flight attendants for flight attendants.
AFA represents over 46,000 flight attendants at 22 airlines,
serving as a voice for flight attendants at their workplace, in
the industry, in the media and on Capitol Hill.
Headquartered in Indianapolis, Indiana, ATA Airlines, owned by ATA
Holdings Corp. -- http://www.ata.com/-- is the nation's 10th
largest passenger carrier (based on revenue passenger miles) and
one of the nation's largest low-fare carriers. ATA has one of the
youngest, most fuel-efficient fleets among the major carriers,
featuring the new Boeing 737-800 and 757-300 aircraft. The
airline operates significant scheduled service from Chicago-
Midway, Hawaii, Indianapolis, New York and San Francisco to over
40 business and vacation destinations. Stock of parent company,
ATA Holdings Corp., is traded on the Nasdaq Stock Exchange. The
Company and its debtor-affiliates filed for chapter 11 protection
on Oct. 26, 2004 (Bankr. S.D. Ind. Case Nos. 04-19866, 04-19868
through 04-19874). Terry E. Hall, Esq., at Baker & Daniels,
represents the Debtors in their restructuring efforts. When the
Debtors filed for protection from their creditors, they listed
$745,159,000 in total assets and $940,521,000 in total debts.
AUBURN FOUNDRY: Trustee Employs Rothberg Logan as Special Counsel
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Indiana
gave Rebecca Hoyt Fischer, Esq., the chapter 7 Trustee for Auburn
Foundry, Inc., permission to employ Mark A. Warsco, Esq., and his
firm, Rothberg Logan & Warsco LLP, as her special counsel.
The Trustee has selected Rothberg Logan to provide legal services
because of its prior experience in bankruptcy matters. The firm
will represent Ms. Fischer in this chapter 7 proceeding. Before
the case was converted, Rothberg Logan handled some avoidance
actions as conflicts counsel.
The firm will bill the Debtor based on its professionals' hourly
rates:
Attorney Hourly Rate
-------- -----------
Mark A. Warsco $265
Susan E. Trent $175
Mr. Warsco assures the Court that Rothberg Logan is a
"disinterested person" as that term is defined in section 101(14)
of the bankruptcy code.
Headquartered in Auburn, Indiana, Auburn Foundry, Inc. --
http://www.auburnfoundry.com/-- produces iron castings for the
automotive industry and automotive aftermarket industry. The
Company filed for chapter 11 protection on February 8, 2004
(Bankr. N.D. Ind. Case No. 04-10427). John R. Burns, Esq.,
and Mark A. Werling, Esq., at Baker & Daniels, represent the
Debtor in its restructuring efforts. When the Company filed for
protection from its creditors, it listed both estimated debts and
assets of over $10 million. The Debtor's chapter 11 case was
converted into a liquidation proceeding under chapter 7 of the
Bankruptcy Code on Oct. 11, 2005.
AUSTIN COMPANY: Panel Taps Schottenstein Zox as Chapter 11 Counsel
------------------------------------------------------------------
The Official Committee of Unsecured Creditors of Austin Holdings,
Inc., and its debtor-affiliates, asks the U.S. Bankruptcy Court
for the Northern District of Ohio for permission to employ
Schottenstein Zox & Dunn Co., LPA, as its bankruptcy counsel.
Schottenstein Zox is expected to:
a) provide legal advice with respect to the Committee's
rights, powers and duties;
b) advise the Committee concerning the administration of the
Debtors' cases;
c) assist the Committee in the investigation of the acts,
conduct, assets, liabilities, and financial condition of
the Debtors;
d) prepare necessary responses, objections, applications,
motions, answers, orders, reports and other legal papers;
e) represent the Committee in all proceedings in this matter;
f) participate in the formulation and negotiation of one or
more plans of reorganization; and
g) perform all other appropriate legal services that the
Committee may request.
Schottenstein Zox's professionals and their current hourly billing
rates are:
Professional Rate
------------ ----
M. Colette Gibbons, Esq. $375
Victoria E. Powers, Esq. $335
Michael D. Tarullo, Esq. $300
Robert M. Stefancin, Esq. $295
Hansel H. Rhee, Esq. $225
Stephen P. Withee, Esq. $225
Tyson A. Crist, Esq. $195
Kristen E. Braden, Esq. $150
Taylor M. Wesley, Esq. $150
Tena M. Thompson $135
Legal Assistants $110
Ms. Gibbons assures the Court of her firm's disinterestedness as
that term is defined in Section 101(14) of the Bankruptcy Code.
Headquartered in Cleveland, Ohio, The Austin Company is an
international firm offering a comprehensive portfolio of in-house
architectural, engineering, design-build, construction management
and consulting services. The Company also offers value-added
strategic planning services including site location,
transportation and distribution consulting, and facility and
process audits. The Company and two affiliates filed for chapter
11 protection on Oct. 14, 2005 (Bankr. N.D. Ohio Lead Case No. 05-
93363). Christine M. Pierpont, Esq., at Squire, Sanders &
Dempsey, LLP, represents the Debtors in their restructuring
efforts. When the Debtors filed for protection from their
creditors, they estimated between $10 million to $50 million in
total assets and debts.
BANCO RURAL: Moody's Withdraws $500 Million Notes' B2 Rating
------------------------------------------------------------
Moody's Investors Service withdrew the foreign currency bond
rating on Banco Rural S.A.'s US$500 million medium-term note
program, following the maturity of all bonds issued under the
program.
This rating was withdrawn:
* Banco Rural; S.A. long-term foreign currency bond rating
of B2
BEARD COMPANY: Sept. 30 Balance Sheet Upside-Down by $5.2 Million
-----------------------------------------------------------------
The Beard Company (OTC BB: BRCO) reported a net loss of $574,000
for the third quarter of 2005 compared with a net loss of $512,000
in the comparable 2004 quarter. Revenues were up 38%, increasing
to $344,000 in the current quarter versus $249,000 a year ago.
Revenues escalated 47% to $914,000 for the current nine months
versus $622,000 for the comparable 2004 period. For the nine
months ended Sept. 30, 2005, the Company reported a net loss of
$1,324,000 compared to net earnings of $1,488,000 in the 2004
period.
Herb Mee, Jr., President, stated: "Our progress during the quarter
was mixed. The CO2 Segment showed strong improvement, with
revenues up 57% and operating profit up 66% over the previous
year. We do not yet have approval from the USDA on the financing
needed for our Pinnacle Project, which has postponed commencement
of the project. As a result of delays in hooking up our new gas
wells in Colorado, they did not start producing income until the
end of the quarter. Our new fertilizer plant in China commenced
production in September. However, sales have developed more
slowly than originally projected, which will likely result in a
loss for the segment in the fourth quarter."
"Results for the nine months of 2004 benefited from the $2,943,000
received from the McElmo Dome Settlement, whereas the 2005 period
had no such benefit. Operating results for the current periods
were mixed, with the third quarter of 2005 generating an operating
loss of $429,000 versus $409,000 in 2004, while the nine months of
2005 actually improved, reflecting an operating loss of $1,109,000
compared to $1,201,000 in 2004," Mr. Mee concluded.
The Beard Company's operations consist principally of coal
reclamation activities, carbon dioxide gas production, the
construction of fertilizer plants in China, and its e-commerce
activities aimed at developing business opportunities to leverage
starpay(TM)'s intellectual property portfolio of Internet payment
methods and security technologies.
At Sept. 30, 2005, The Beard Company's balance sheet showed a
$5,200,000 stockholders' deficit compared to a $4,144,000 deficit
at Dec. 31, 2004.
BEAZER HOMES: Buying Back 10 Million Shares for Up to $250 Million
------------------------------------------------------------------
Beazer Homes USA, Inc. (NYSE: BZH), disclosed the acceleration of
its comprehensive plan to enhance shareholder value, built upon
the demonstrated success of the Profitable Growth Strategy that
the Company has articulated and executed over the past two years.
As part of this plan, the Board of Directors has authorized the
Company to repurchase 10 million shares of the Company's stock.
"The record results in the fourth quarter of fiscal 2005 reinforce
the effectiveness of our profitable growth initiatives in
achieving greater profitability by optimizing efficiencies,
increasing market penetration, and leveraging our national brand.
During that quarter, we improved homebuilding gross margin and
operating income margin by 350 basis points over the prior year,
driving a 98% increase in diluted earnings per share," said Ian J.
McCarthy, President and Chief Executive Officer. "Beazer Homes
will build upon these successes by targeting margins and return on
invested capital within the upper quartile of the industry."
"During the previous quarter and fiscal year, the Company has made
considerable progress in realizing our stated goal of enhancing
margins and profitability by executing its profitability
initiatives. The Board of Directors and management of Beazer
Homes have since further developed our Profitable Growth Strategy
to enhance shareholder value in the context of the current market
environment. Coupled with continued execution of our profitable
growth initiatives, we will pursue a more aggressive share
repurchase strategy to further enhance shareholder value," said
McCarthy. "The Board of Directors has authorized the expansion of
the Company's existing share repurchase program from 2 million
shares as of September 30, 2005 to a total of 10 million shares.
This increase reflects our confidence in Beazer Homes' future
performance and our commitment to returning capital to our
shareholders."
$200 to $250 Million Allocation
The Company expects to execute the repurchase program within the
next 36 months, with $200 to $250 million allocated to share
repurchases in fiscal 2006, subject to market conditions and other
factors. Shares may be purchased for cash in the open market, on
the New York Stock Exchange or in privately negotiated
transactions. Furthermore, the Company will enter into a plan
under Rule 10b5-1 to execute a portion of the share repurchase
program, supplemented with opportunistic purchases in the open
market or in privately negotiated transactions. The Company said
that following the release of its fourth quarter and fiscal year
results, it had repurchased 500,000 shares.
The Company will fund this expanded share repurchase program by
redeploying its cash by limiting or curtailing operations in
certain markets, reinvesting in higher margin markets and
accelerating cash generation through increased profitability. The
Company intends to maintain a capital structure with net debt to
total capitalization at approximately 50%. Given the further
development of this strategy, the Company is also reviewing its
existing compensation programs, including better aligning the
interests of management and its shareholders within the context of
this program.
"Our strong level of backlog, coupled with our current
expectations for further competitive advantages for large public
builders such as Beazer Homes, provides us confidence in our
future." said McCarthy. "In addition, our recent review of our
capital allocation strategies is highly focused on our most
profitable opportunities. We expect that our margin expansion
program, combined with the announced expansion of our share
repurchase authorization to 10 million shares, will further
enhance shareholder value. We also maintain our initial outlook
for fiscal 2006 diluted earnings of $10.50 per share, not taking
into account any impact from these capital allocation strategies.
Any impact these strategies may have on our outlook will be
addressed prospectively."
Headquartered in Atlanta, Beazer Homes USA, Inc. --
http://www.beazer.com/-- is one of the country's ten largest
single-family homebuilders with operations in Arizona, California,
Colorado, Delaware, Florida, Georgia, Indiana, Kentucky, Maryland,
Mississippi, Nevada, New Jersey, New Mexico, New York, North
Carolina, Ohio, Pennsylvania, South Carolina, Tennessee, Texas,
Virginia and West Virginia and also provides mortgage origination
and title services to its homebuyers. Beazer Homes, a Fortune 500
company, is listed on the New York Stock Exchange under the ticker
symbol "BZH."
* * *
As reported in the Troubled Company Reporter on June 7, 2005,
Fitch Ratings assigned a 'BB+' rating to Beazer Homes USA,
Inc. (NYSE: BZH) $300 million, 6.875% senior unsecured notes due
July 15, 2015. Fitch said the Rating Outlook is Stable.
BRILLIANT DIGITAL: Incurs $627K Net Loss in Quarter Ended Sept. 30
------------------------------------------------------------------
Brilliant Digital Entertainment, Inc., delivered its financial
results for the quarter ended Sept. 30, 2005, to the Securities
and Exchange Commission on Nov. 14, 2005.
For the three months ended Sept. 30, 2005, Brilliant Digital
incurred a net loss of $627,000 on $1,485,000 of revenues, in
contrast to a $2,059,000 net loss on $2,114,000 of revenues for
the comparable period in 2004.
The Company's balance sheet showed $2,777,000 of assets at
Sept. 30, 2005, and liabilities totaling $3,800,000, resulting in
a stockholder's deficit of $1,023,000. As of Sept. 30, 2005, the
Company had a working capital deficit of $4,446,000, excluding a
non-cash debt discount of $2,949,000 related to the issuance of
warrants. Included in this working capital deficit are accounts
payable, accrued expenses and accrued expenses to related parties
of $728,000 which are over 90 days past due, and $3,777,000 of
secured indebtedness.
Brilliant Digital had cash and cash equivalents totaling
approximately $1,248,000 at Sept. 30, 2005. This is an increase
of $945,000 as compared to Dec. 31, 2004. Cash and cash
equivalents included $294,000 of an advance against future
payments due from Focus Interactive, Inc. under a Strategic
Alliance and Distribution Agreement. Since June 2003, the Focus
payments under the agreement have funded a substantial portion of
the Company's working capital needs.
Going Concern Doubt
Vasquez & Company LLP expressed substantial doubt about
Brilliant Digital's ability to continue as a going concern
after it audited the Company's financial statements for the
year ended Dec. 31, 2004. The auditing firm pointed to the
Company's losses and working capital deficiency.
About Brilliant Digital
Through its Altnet, Inc., subsidiary, Brilliant Digital
Entertainment, Inc. -- http://www.brilliantdigital.com/--
operates a peer-to-peer-based content distribution network that
allows the secure and efficient distribution of a content owner's
music, video, software and other digital files to computer users
via the Internet.
BONUS STORES: Court Extends Claims Objection Deadline to Feb. 13
----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware gave
William Kaye, the Liquidating Agent appointed to administer the
confirmed chapter 11 Plan of Bonus Stores, Inc., until Feb. 13,
2006, to object to proofs of claim filed against the Debtor's
estate.
Mr. Kaye told the Bankruptcy Court that the extension will allow
him to:
* review any remaining claims,
* file any additional objections, and
* notice all outstanding claims objection to be heard before
the Court.
The Liquidating Agent believes that he will be able to complete
the claims objection process within the extended period.
Headquartered in Columbia, Mississippi, Bonus Stores, Inc.,
operated a chain of over 360 stores in 13 Southeastern states
offering everyday deep discount prices on basic everyday items.
The Company filed for chapter 11 protection on July 25, 2003
(Bankr. Del. Case No. 03-12284). Joel A. Waite, Esq., at Young
Conaway Stargatt & Taylor, LLP represents the Debtor. When the
Company filed for protection from its creditors, it estimated
assets and debts of more than $100 million. Bonus Stores, Inc.
(fka Bill's Dollar Stores) declared its First Amended Liquidating
Chapter 11 Plan effective on September 20, 2004. William Kaye is
the Liquidating Agent under the Debtors' confirmed Plan. Edward
J. Kosmowski, Esq., at Young Conaway Stargatt & Taylor, LLP
represents the Liquidating Agent.
BROOKLYN HOSPITAL: Outlines Procedures for Lien Claimant Payments
-----------------------------------------------------------------
The Brooklyn Hospital Center and Caledonian Health Center, Inc.,
ask the U.S. Bankruptcy Court for the Eastern District of New York
for authority to establish procedures in connection with the
payment of prepetition claims for certain construction services
and other lien claimants who may have state law remedies available
to secure payment of their claims.
The Debtors want to pay and discharge, on a case-by-case basis,
the debts owed to lien claimants on order to avoid undue delay and
to facilitate the continued operation of their businesses, the
maintenance of their properties and the completion of necessary
construction, repair and maintenance of their facilities.
The Debtors propose that:
a) lien claimants holding prepetition claims of $100,000 or
less, will be paid only with the consent of the Debtors'
Official Committee of Unsecured Creditors.
b) in the event that the Committee prohibits the Debtors from
paying the prepetition claim of a Lien Claimant in excess
of $100,000, the Debtors will be required to obtain prior
Bankruptcy Court approval before making any payment.
Payment to the lien claimants will be made on the condition that
the claimants promise to continue constructing, repairing and
maintaining the Debtors' facilities on the trade terms that, at a
minimum, the claimants provided to the Debtors on a historical
basis prior to the petition date. The Debtor also reserves the
right to negotiate new trade terms with any lien claimant as a
condition to payment of their claims.
TM Mechanical Payment
In connection with their request to pay prepetition lien
claimants, the Debtors ask the Bankruptcy Court to authorize a
$72,333 payment to TM Mechanical on account of certain prepetition
services.
Prior to the petition date, the Debtors hired TM Mechanical to
render services related to a boiler replacement project at the
Debtors' hospital facility.
The project is near completion, but TM Mechanical has threatened
to stop work if it not paid for its pre-petition services. The
Debtors believe that TM Mechanical would be entitled to obtain a
mechanic's lien for the unpaid prepetition work.
Lawrence M. Handelsman, Esq. at Stroock & Stroock & Lavan LLP
tells the Bankruptcy Court that obtaining another contractor to
complete the project would raise costs, delay completion and void
the boiler warranty provided by TM Mechanical.
Headquartered in Brooklyn, New York, The Brooklyn Hospital Center
-- http://www.tbh.org-- provides a variety of inpatient and
outpatient services and education programs to improve the well
being of its community. The Debtor, together with Caledonian
Health Center, Inc., filed for chapter 11 protection on Sept. 30,
2005 (Bankr. E.D.N.Y. Case No. 05-26990). Lawrence M. Handelsman,
Esq., and Eric M. Kay, Esq., at Stroock & Stroock & Lavan LLP
represent the Debtors in their restructuring efforts. When the
Debtors filed for protection from their creditors, they listed
$233,000,000 in assets and $337,000,000 in debts.
CABLEVISION SYSTEMS: Rejects $700 Million Offer for Sports Teams
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Cablevision Systems Corp. rejected a $700 million offer made by an
investment group led by Russell D. Glass for the purchase of the
company's Knicks basketball and Rangers hockey teams, the
Associated Press reports.
"Cablevision has no plans to sell the Knicks and the Rangers and
the inquiry does not look credible to us," Peter Grant of The Wall
Street Journal quoted a Cablevision spokesman as saying.
Mr. Glass, who has worked for billionaire Carl Icahn's investment
firm, did not disclose the group's identity.
The Glass-led group also offered to purchase Cablevision's Madison
Square Garden last month but didn't set a price, Mr. Grant
reports, citing unidentified people familiar with the matters.
A $700 million offer would compare with the team's $750 million
value based on a Forbes magazine survey, Connie Guglielmo of
Bloomberg News relates.
Cablevision Systems Corporation -- http://www.cablevision.com/--
is one of the nation's leading entertainment, media and
telecommunications companies. In addition to its cable, Internet,
and voice offerings, the company owns and operates Rainbow Media
Holdings LLC and its networks; Madison Square Garden and its
teams; and, Clearview Cinemas. In addition, Cablevision operates
New York's Radio City Music Hall.
As of Sept. 30, 2005, Cablevision's equity deficit narrowed to
$2.54 billion from a $2.63 billion deficit at Dec.31, 2004.
CAMBEX CORP: Balance Sheet Upside-Down by $3.7 Million at Oct. 1
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Cambex Corporation delivered its financial results for the quarter
ended Oct. 1, 2005, to the Securities and Exchange Commission on
Nov. 14, 2005.
Revenues were $426,378 for the quarter ended Oct. 1, 2005, as
compared to $853,437 of revenues for the same period in 2004.
Gross profit rate was 80% of sales for the three months ended
Oct. 1, 2005, in contrast to a gross profit rate of 81% for the
three months ended Oct. 2, 2004. The gross profit figure for
third quarter 2005 included a $41,000 reversal of previously
accrued third party charges.
Cambex incurred a $97,000 net loss for the third quarter of 2005,
compared with net income of $252,000 for the third quarter of
2004.
The Company's balance sheet showed assets of $733,142 at Oct. 1,
2005, and liabilities totaling $4,398,050, resulting in a
stockholders' deficit of $3,664,908. At Oct. 1, 2005, the Company
had working capital deficit of $3,670,000.
During the nine months ended Oct. 1, 2005, net cash provided by
operating activities was $55,848. Net cash used in investing
activities was $6,000. Net cash used in financing activities was
$37,456, relating primarily to repayments of notes payable.
Cambex has a loan and security agreement with B.A. Associates,
Inc., under which it can borrow up to $1.1 million. The
outstanding balance due to B.A. Associates was $799,467 at Oct. 1,
2005. In addition, the Company has a notes payable of $479,643 at
Oct. 1, 2005, including $275,000 of advances payable from related
parties, which are due on demand. The notes payable balance of
$204,643 includes $150,000 of series 1 bridge financing note and
$54,643 of accounts payable converted to notes payable.
About Cambex
Headquartered in Westborough, Massachusetts, Cambex Corporation
-- http://www.cambex.com/-- provides products and services for
optimizing storage network productivity and application
performance. The Company's products include storage caching
appliances, server memory, Fibre Channel host bus adapters, and
high availability software. Services include SAN optimization and
mainframe rehosting.
CAPROCK HOLDINGS: Moody's Rates $36 Million Sr. Sec. Loan at B3
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Moody's Investors Service assigned initial ratings to CapRock
Holdings Inc. of B2 Corporate Family, B2 First Priority Senior
Secured, and B3 Second Priority Senior Secured. The outlook is
stable.
These first time ratings were assigned:
* Corporate Family Rating B2
* First Priority Senior Secured B2
-- US$30 million Revolving Facility, due November 2011
-- US$115 million Term Loan, due November 2011
* Second Priority Senior Secured B3
-- US$36 million Term Loan, due November 2012
The outlook is stable.
The rated debt, which will fund about 75% of the acquisition of
CapRock by ABRY Partners, a private equity firm, will be secured
by all the assets of the company. As the funded 1st Priority
Senior Secured Loan will comprise about 75% of initial total
indebtedness, it has been rated at the same level as the Corporate
Family Rating. The 2nd Priority Senior Secured Loan has been
notched down one level from the Corporate Family rating to reflect
its junior ranking collateral position.
Moody's believes CapRock's liquidity position is adequate.
Pro-forma the transaction, Moody's expects the company will have
minimal cash balances and access to an essentially unused $30
million First Priority Senior Secured revolving bank facility for
liquidity purposes. Moody's expects proposed covenants may limit
full revolver usage marginally following closing of the
transaction, but that this constraint should ease gradually
through 2006. Moody's expects CapRock will generate sufficient
free cash flow over the next few years to fund modest debt
maturities.
The Corporate Family rating is supported by:
1) CapRock's strong operating performance over the last few
years serving a largely blue chip customer base;
2) the contractual nature of much of CapRock's service
revenues;
3) healthy customer retention rates, helped by the existence of
high customer switching costs and high quality service
levels; and
4) Moody's expectation that CapRock will generate modestly
positive free cash flow in each of the next two years.
The ratings are constrained by:
1) the significant concentration of revenues to one key
customer;
2) Moody's belief that satellite bandwidth demands of this
specific customer may decline gradually over the next few
years;
3) the competitive nature of the satellite communications
service industry generally; and
4) the company's small scale.
The rating outlook is stable as Moody's expects CapRock to produce
modest revenue growth over the next few years, maintain operating
margins at approximately 30%, while reducing capital spending to
near maintenance levels. As a result, Moody's expects key
financial metrics over this period to improve slightly, allowing
the company to remain well positioned within the B2 rating
category.
In particular, Moody's expects CapRock to generate free cash flow
to debt in the low to mid-single digit percentage range with debt
to EBITDA leverage remaining near 5x and EBITDA- Capex/ Interest
coverage of almost 2x (all calculations adjusted per Moody's
published methodology).
The ratings might be considered for upgrade if Moody's were to
believe that CapRock would be able to generate sustainable revenue
growth at least in the high single digits and debt/ EBITDA
leverage were to decrease to roughly 4x. The ratings might be
considered for downgrade if Moody's believed CapRock were unable
to generate any sustainable free cash flow, likely arising from an
unexpected contract loss or higher than planned maintenance
capital expenditures.
CapRock is focused on providing mission critical fixed satellite
communications in remote locations, engineered at high levels of
reliability. The majority of the company's revenue is contractual
over a 12 to 36 month timeframe, which gives good near term
revenue visibility. Additionally, Moody's believes that the
installed customer equipment engineered specifically for CapRock's
network and customer demands results in high customer switching
costs, which helps customer retention rates and acts to stabilize
revenues.
Furthermore, Moody's believes the company's business model
provides it with a good degree of ability to match operating and
capital costs with associated revenues, providing a highly
variable cost structure. Moody's notes, however, that over 50% of
CapRock's revenue is concentrated with one key customer, which
constrains the rating.
The remote communications industry is highly fragmented, which
Moody's believes may contribute to general industry pricing
pressures. Moody's acknowledges however that CapRock focuses on a
niche part of the industry which has few global competitors,
mitigating these concerns to some extent. Moody's also believes
the industry is likely to consolidate over the near term, which
may result in larger competitors, reducing CapRock's current
advantage of being a global provider. In Moody's opinion, it is
also possible that CapRock may seek out small acquisitions to
increase its scale over the intermediate term, which may limit
improvement to overall credit metrics.
CapRock Holdings Inc., dba CapRock Communications, is a global
remote fixed satellite-based communications provider headquartered
in Houston, Texas.
CATHOLIC CHURCH: Court Okays Traxi as Spokane's Financial Advisor
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As previously reported, the U.S. Bankruptcy Court for the Eastern
District of Washington authorized the Committee of Tort Litigants
in the Diocese of Spokane's Chapter 11 case to retain Traxi LLC as
financial advisors as of March 30, 2005. Judge Williams
temporarily denied the application to the extent that the Tort
Litigants sought Traxi's retention to analyze the assets of the
Diocese's affiliated entities, without prejudice to the Tort
Litigants' right to renew the application after the Court rules on
the Tort Litigants' request for summary judgment.
In light of the Court's recent decision granting the Litigants
Committee's request for partial summary judgment on the "property
of the estate dispute," John W. Campbell, Esq., at Esposito,
George & Campbell, PLLC, in Spokane, Washington, contends that it
is appropriate to submit an amended order approving Traxi's
retention. The Amended Order will eliminate the Court's
limitation on Traxi's ability to analyze the financial
relationship between the Diocese and its affiliate entities, Mr.
Campbell says.
The Litigants Committee seeks the Court's permission to file the
proposed Amended Order, without fixing Traxi's specific
compensation.
Spokane Objects
Traxi's retention as a financial consultant is unnecessary and the
Application should be denied, Michael J. Paukert, Esq., at Paine,
Hamblen, Coffin, Brooke & Miller LLP, in Spokane, Washington,
tells the Court.
Mr. Paukert notes that the Court's order granting the Litigants
Committee's request for partial summary judgment did not determine
whether or not Spokane's affiliated entities are separate entities
from the Diocese. The Court Order only determined that the real
property of around 20 parishes were part of the Diocese's estate.
Thus, Mr. Paukert argues that there is no justification to retain
a financial advisor to determine the enterprise value of the
Diocese, parishes, and separately incorporated entities, when no
determination has been made that these entities are a single
"enterprise."
Mr. Paukert further notes that to the extent it is necessary to
value the real property of the Diocese and the real property of
the parishes that were subject of the Court's Order granting the
partial summary judgment, the services should be performed by an
appraiser with experience appraising property within the Spokane
market, and not a financial advisor located in New York.
"The [Diocese] is already responsible for the travel expenses of
the [Litigants Committee's] legal counsel," Mr. Paukert asserts.
The Diocese should not be made to pay further pay any expenses for
the cross-country travel of the Committee's financial consultants,
he adds.
Spokane alleges that Traxi's retention for the purposes of
investigating, analyzing or taking any other action in support of
potential preferences, related party transactions, fraudulent
conveyances, or other avoidance actions, is premature. Since the
Litigants Committee does not have the authority to initiate any
litigation on behalf of the Diocese, the Committee has no
authority, reason or need to retain Traxi for these purposes.
Spokane also contends that retaining a financial advisor during
its exclusivity period to aid in the development of alternative
plans is an "unnecessary expenditure of estate assets." Besides,
Mr. Paukert says, a financial consultant with an hourly rate of
$250 is unreasonable for the Spokane area.
* * *
Judge Williams authorizes the Tort Litigants Committee to retain
Traxi, with a limit to the amount of fees to be generated by the
appointment. Judge Williams directs the Litigants Committee's
counsel to provide the order approving Traxi's appointment.
The Roman Catholic Church of the Diocese of Spokane filed for
chapter 11 protection (Bankr. E.D. Wash. Case No. 04-08822) on
Dec. 6, 2004. Michael J. Paukert, Esq., at Paine, Hamblen,
Coffin, Brooke & Miller, LLP, represents the Spokane Diocese in
its restructuring efforts. When the Debtor filed for protection
from its creditors, it listed $11,162,938 in total assets and
$81,364,055 in total debts. (Catholic Church Bankruptcy News,
Issue No. 46; Bankruptcy Creditors' Service, Inc., 215/945-7000)
CATHOLIC CHURCH: Spokane Wants to Retain GVA Kidder as Consultant
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The Tort Litigants Committee, the Tort Claimants Committee, and
Gayle E. Bush, the Future Claims Representative, appointed in the
Diocese of Spokane's bankruptcy case allege that Spokane's
Disclosure Statement is devoid of any valuation information
regarding the real property claimed by the Parishes and affiliated
entities.
The real property that is admittedly part of the Diocese's estate
is either unappraised or the subject of outdated appraisals, the
tort claimants representatives explain. Hence, they require
consulting and appraisal services for the Spokane real property,
and the real property claimed by the parishes and affiliated
entities.
For this reason, Mr. Bush and the Committees seek authority from
the U.S. Bankruptcy Court for the Eastern District of Washington
to retain GVA Kidder Mathews as their appraiser and consultant.
GVA will provide appraisal services for real property identified
by the FCR and the Committees, and will be available to testify on
behalf of the FCR and the Committees in any litigation. In
addition, GVA will consult with the FCR and the Committees
regarding specific real estate issues as they arise in the case.
GVA will prepare appraisal and consulting services in accordance
with the appraisal reporting standards of the Uniform Standards of
Professional Appraisal Practice of the Appraisal Institute. GVA
will also provide Complete Summary appraisal reports for
properties as directed by the FCR and the Committees.
GVA will be paid based on these hourly rates:
Professional Hourly Rate
------------ -----------
Peter K. Shorett, MAI, CRE, CCIM $200
Staff MAI $150
Senior Analyst $125
Associate Analyst $100
Research $75
Administrative Staff $50
GVA will also be reimbursed for travel expenses from Seattle,
Washington, and the living expenses sustained while doing
fieldwork in Spokane, Washington. If the scope of analysis
changes during the appraisal process, the change could alter the
cost, Mr. Bush notes.
Peter K. Shorett, executive vice-president of GVA, assures Judge
Williams that GVA does not hold or represent any interest adverse
to the Diocese, and is "disinterested" within the meaning of
Section 101(14) of the Bankruptcy Code.
The FCR and the Committees may have adverse interests on issues in
the case but they do not have adverse interests regarding the
scope of GVA's duties, Mr. Bush adds.
Objections
A. Diocese of Spokane
The Diocese of Spokane recognizes the need to appraise the real
property of the Parishes and schools located within the Diocese.
However, Spokane finds Mr. Bush and the Committee's request to
retain GVA silent as to any methodology that may be used to
determine the value of the real property of the parishes and
schools located within the Diocese. Spokane wants the Court to
require disclosure of intended methodology for the appraisal and a
more concrete explanation of the work product that GVA will
provide.
If the needed information is disclosed, Michael J. Paukert, Esq.,
at Paine, Hamblen, Coffin, Brooke & Miller LLP, in Spokane,
Washington, notes that valuation disputes will be minimized and
the Diocese will not need to retain an appraiser, consuming
additional estate assets.
Spokane also wants the Court to compel GVA to disclose a budget
prior to approval of GVA's retention.
Spokane also argues that there is no need to appraise the real
property of the so-called "affiliated entities" which are also
defendants in the Property of the Estate litigation, like:
* Catholic Charities,
* Morning Star Boys Ranch, and
* Catholic Cemeteries.
"Appraisal of the real property of the affiliated entities is
unnecessary use of the estate assets," Mr. Paukert says.
In the event that the Court approves GVA's retention, Spokane asks
the Court to limit the scope of GVA's employment to appraisal of
the parishes and schools.
B. Parishes
As creditors of the Diocese of Spokane's Chapter 11 estate, the
individual parishes contend that GVA's retention is premature at
this time. The Parishes also argue that the retention will
duplicate administrative costs, and will, at this time, not
promote economic resolution of the confirmation issues relating to
Spokane's Plan of Reorganization.
The Parishes, therefore, ask the Court to deny approval of GVA's
retention.
The Roman Catholic Church of the Diocese of Spokane filed for
chapter 11 protection (Bankr. E.D. Wash. Case No. 04-08822) on
Dec. 6, 2004. Michael J. Paukert, Esq., at Paine, Hamblen,
Coffin, Brooke & Miller, LLP, represents the Spokane Diocese in
its restructuring efforts. When the Debtor filed for protection
from its creditors, it listed $11,162,938 in total assets and
$81,364,055 in total debts. (Catholic Church Bankruptcy News,
Issue No. 46; Bankruptcy Creditors' Service, Inc., 215/945-7000)
CENTRAL VERMONT: Selling Catamount Energy Unit to Diamond Castle
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Central Vermont Public Service (NYSE:CV) reported that its wholly
owned subsidiary, Catamount Resources Corp., will sell its entire
interest in subsidiary wind energy company Catamount Energy Corp.,
to Diamond Castle, a New York-based private equity investment
firm, and its affiliated funds for $60 million in cash, less
$750,000 in certain transaction expenses.
"The sale of Catamount brings to a rewarding close our investment
in the independent power business," CVPS President Bob Young said.
"The sale provides us a solid return on our investment, and gives
the company myriad options for use of the proceeds as we look
forward."
CVPS announced the sale of a 51 percent interest in Catamount to
Diamond Castle last month, but retained an option to sell the
entire business, which it has now exercised. CVPS was able to
exercise the option earlier than previously expected because
Diamond Castle waived a condition requiring completion of
Sweetwater III, a Catamount wind development in Texas that is
expected to be completed by early 2006.
As a result of the sale CVPS expects to realize approximately
$52 million in cash and recognize a net gain in the fourth
quarter. The amount of the gain has not yet been determined. The
sale is scheduled to close in December. The definitive agreements
were filed with the Securities Exchange Commission on a Form 8-K
by the Company on Oct. 18, 2005.
CVPS is currently evaluating how it will apply the proceeds of the
sale, but it currently expects to return approximately $52 million
to shareholders, either through a stock buy-back or a special
dividend to shareholders.
Returning CVPS to Financial Strength
"The Catamount sale complements a restoration plan we are
implementing to return CVPS to a strong financial position, which
is critical for our investors and our customers as we address
power supply and transmission issues" Mr. Young said.
That plan includes:
* One-time 2005 budget cuts of $750,000;
* Securing a $25 million revolving credit facility in October
2005;
* $2.7 million in 2006 budget cuts, including a 10 percent
cut in Young's salary and a 5 percent reduction in other
officers' salaries, which will help offset rising fuel and
medical costs;
* Deferral of $4.8 million of capital investments, which
won't affect service, from 2006 to the next few years;
* Restructuring the board of directors in 2006;
* Efforts to improve communication with Vermont regulators
and find common ground on customer and company needs.
Diamond Castle Holdings, LLC is a private equity firm founded in
September 2004. Lawrence Schloss, the former chairman of
Donaldson, Lufkin & Jenrette's and Credit Suisse First Boston's
successful private equity business, is the CEO of Diamond Castle.
Diamond Castle has 21 employees located in New York and focuses on
investments in the power, financial services, media and telecom,
and healthcare sectors.
Founded in 1929, Central Vermont Public Service is Vermont's
largest electric utility, serving about 150,000 customers
statewide. The company's two non-regulated subsidiaries include
Catamount Energy Corporation and Eversant Corporation. Catamount
invests in non-regulated energy generation projects in the United
States and United Kingdom with a focus on developing, owning and
operating wind energy projects. Eversant sells and rents electric
water heaters through a subsidiary, SmartEnergy Water Heating
Services.
* * *
As reported in the Troubled Company Reporter on June 20, 2005,
Fitch Ratings has downgraded the ratings of Central Vermont Public
Service's as follows:
-- Senior secured debt to 'BBB' from 'BBB+';
-- Preferred stock to 'BB+' from 'BBB-'.
The Rating Outlook is Stable.
CENTURY/ML CABLE: Wants Until February 13 to File Final Report
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Pursuant to Rule 3022 of the Federal Rules of Bankruptcy
Procedure and the Order confirming its Plan of Reorganization,
Century/ML Cable Venture is required to file a closing report by
mid-November of 2005.
According to Richard S. Toder, Esq., at Morgan Lewis & Bockius
LLP, in New York, as a result of significant disputed claims and
continuing litigation between Adelphia Communications Corp. and
Century/ML, Century/ML's estate will remain active until the time
the litigation is resolved.
Therefore, Century/ML asks the U.S. Bankruptcy Court for the
Southern District of New York to extend until Feb. 13, 2005, the
deadline to file its final closing report.
Century Communications Corporation filed for Chapter 11 protection
on June 10, 2002. Century's case has been jointly administered to
proceedings of Adelphia Communications Corporation. Century
operates cable television services in Colorado, California and
Puerto Rico. CENTURY is an indirect wholly owned subsidiary of
ACOM and an affiliate of Adelphia Business Solutions, Inc.
Lawyers at Willkie, Farr & Gallagher represent CENTURY.
Headquartered in Coudersport, Pennsylvania, Adelphia
Communications Corporation (OTC: ADELQ) is the fifth-largest cable
television company in the country. Adelphia serves customers in
30 states and Puerto Rico, and offers analog and digital video
services, high-speed Internet access and other advanced services
over its broadband networks. The Company and its more than 200
affiliates filed for Chapter 11 protection in the Southern
District of New York on June 25, 2002. Those cases are jointly
administered under case number 02-41729. Willkie Farr & Gallagher
represents the ACOM Debtors. (Adelphia Bankruptcy News, Issue
No. 115; Bankruptcy Creditors' Service, Inc., 215/945-7000)
CHARTER COMMS: Selling 122.8 Million Shares via Public Offering
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The Securities and Exchange Commission has declared effective
Charter Communications, Inc.'s registration statement on Form S-1
covering the sale of up to 122.8 million shares of its Class A
common stock, which it intends to loan to Citigroup Global Markets
Limited pursuant to a share lending agreement for sale in a public
offering by Citigroup or its affiliates.
The shares of the Class A common stock are being offered on a
"best efforts" basis. This offering of Charter's Class A common
stock is being conducted to facilitate transactions by which
investors in Charter's 5.875% convertible senior notes due 2009
issued on Nov. 22, 2004, will hedge their investments in the
convertible senior notes. In July 2005, Charter issued 27.2
million shares pursuant to the share lending agreement.
These shares are not being offered to, and may not be purchased
by, any person who holds an open short position in Charter Class A
common stock, any person who is purchasing the shares on behalf of
or for the account of such person, or any person who has an
arrangement or understanding to resell, lend or otherwise transfer
(directly or indirectly) the shares to such a person. Purchasers
of these shares will be required to certify the foregoing in
writing.
Charter will not receive any of the proceeds from the sale of this
Class A common stock. However, under the share lending agreement,
Charter will receive a loan fee of $.001 for each share that it
lends to Citigroup.
Charter Communications, Inc. -- http://www.charter.com/-- a
broadband communications company, provides a full range of
advanced broadband services to the home, including cable
television on an advanced digital video programming platform via
Charter Digital(TM), Charter High-Speed(TM) Internet service and
Charter Telephone(TM). Charter Business(TM) provides scalable,
tailored and cost-effective broadband communications solutions to
organizations of all sizes through business-to-business Internet,
data networking, video and music services. Advertising sales and
production services are sold under the Charter Media(R) brand.
At Sept. 30, 2005, Charter's balnace sheet hsowed a $5 billion
stockholders' deficit, compared to a $4.4 billion deficit at
Dec. 31, 2004.
CHARTER COMMS: Sept. 30 Balance Sheet Upside-Down by $5 Billion
---------------------------------------------------------------
Charter Communications, Inc., delivered its financials statements
for the quarterly period ended Sept. 30, 2005, to the Securities
and Exchange Commission on Nov. 2, 2005.
For the three months ended Sept. 30, 2005, the company earned
$76 million on $1.3 billion in revenues, compared to a
$3.2 billion net loss on $1.2 billion in revenues for the same
period in 2004.
The Company reported a $118 million net cash flows from operating
activities for the nine months ended Sept. 30, 2005, and
$383 million for the same period in 2004.
At Sept. 30, 2005, Charter's balnace sheet hsowed a $5 billion
stockholders' deficit, compared to a $4.4 billion deficit at
Dec. 31, 2004.
Liquidity and Capital Resources
The Company has a significant level of debt. The Company's long-
term financing as of Sept. 30, 2005, consists of:
-- $5.5 billion of credit facility debt;
-- $12.7 billion accreted value of high-yield notes; and
-- $866 million accreted value of convertible senior notes.
For the remainder of 2005, $7 million of the Company's debt
matures, and in 2006, an additional $55 million of the Company's
debt matures. In 2007 and beyond, significant additional amounts
will become due under the Company's remaining long-term debt
obligations.
Private Debt Placement
In September 2005, Charter Holdings and its wholly owned
subsidiaries, CCH I, LLC and CCH I Holdings, LLC, completed the
exchange of approximately $6.8 billion total principal amount of
outstanding debt securities of Charter Holdings in a private
placement for new debt securities.
Holders of Charter Holdings notes due in 2009 and 2010 exchanged
$3.4 billion principal amount of notes for $2.9 billion principal
amount of new 11% CCH I senior secured notes due 2015. Holders of
Charter Holdings notes due 2011 and 2012 exchanged $845 million
principal amount of notes for $662 million principal amount of 11%
CCH I senior secured notes due 2015. In addition, holders of
Charter Holdings notes due 2011 and 2012 exchanged $2.5 billion
principal amount of notes for $2.5 billion principal amount of
various series of new CIH notes. Each series of new CIH notes has
the same stated interest rate and provisions for payment of cash
interest as the series of old Charter Holdings notes for which
such CIH notes were exchanged. In addition, the maturities for
each series were extended three years.
Credit Facilities and Covenants
The Company's ability to operate depends upon, among other things,
its continued access to capital, including credit under the
Charter Communications Operating, LLC credit facilities. These
credit facilities, along with the Company's indentures and Bridge
Loan, contain certain restrictive covenants, some of which require
the Company to maintain specified financial ratios and meet
financial tests and to provide audited financial statements with
an unqualified opinion from the Company's independent auditors.
As of Sept. 30, 2005, the Company is in compliance with the
covenants under its indentures and credit facilities and the
Company expects to remain in compliance with those covenants and
the Bridge Loan covenants for the next twelve months. The
Company's total potential borrowing availability under the current
credit facilities totaled $786 million as of Sept. 30, 2005,
although the actual availability at that time was only $648
million because of limits imposed by covenant restrictions.
Effective Jan. 2, 2006, the Company will have additional borrowing
availability of $600 million as a result of the Bridge Loan.
Continued access to the Company's credit facilities and Bridge
Loan is subject to the Company remaining in compliance with the
covenants of these credit facilities and Bridge Loan, including
covenants tied to the Company's operating performance. If the
Company's operating performance results in non-compliance with
these covenants, or if any of certain other events of non-
compliance under these credit facilities, Bridge Loan or
indentures governing the Company's debt occur, funding under the
credit facilities and Bridge Loan may not be available and
defaults on some or potentially all of the Company's debt
obligations could occur.
An event of default under the covenants governing any of the
Company's debt instruments could result in the acceleration of its
payment obligations under that debt and, under certain
circumstances, in cross-defaults under its other debt obligations,
which could have a material adverse effect on the Company's
consolidated financial condition or results of operations.
A full-text copy of Charter Communications' Form 10-Q is available
at no charge at http://ResearchArchives.com/t/s?316
Charter Communications, Inc. -- http://www.charter.com/-- a
broadband communications company, provides a full range of
advanced broadband services to the home, including cable
television on an advanced digital video programming platform via
Charter Digital(TM), Charter High-Speed(TM) Internet service and
Charter Telephone(TM). Charter Business(TM) provides scalable,
tailored and cost-effective broadband communications solutions to
organizations of all sizes through business-to-business Internet,
data networking, video and music services. Advertising sales and
production services are sold under the Charter Media(R) brand.
CLAREMONT TECHNOLOGIES: Hires Matthew Johnson as Chap. 11 Counsel
-----------------------------------------------------------------
Claremont Technologies Corp. sought and obtained permission from
the U.S. Bankruptcy Court for the District of Nevada to employ
Matthew L. Johnson & Associates, P.C., as its bankruptcy counsel.
Matthew L. Johnson will:
1) institute, prosecute or defend any lawsuits, adversary
proceedings, and contested matters that may arise during
this chapter 11 case;
2) assist in the recovery and liquidation of the estate's
assets, and protect and preserve estate's assets;
3) assist in determining the priorities and status of claims
filed and file objection if necessary;
4) assist in the preparation of a disclosure statement and
chapter 11 plan; and
5) give the Debtor advice in matters related to its case and
perform all other legal services which are necessary in
this bankruptcy proceeding.
Wataire Industries Inc. paid the firm a $10,000 retainer. As
previously reported, under the Plan of Reorganization of
Claremont, Wataire will be contributing certain assets and
technologies to Claremont in exchange for approximately 70% of the
common stock of Claremont. This will result in Claremont
becoming a majority owned subsidiary of Wataire.
Matthew L. Johnson, Esq., is the lead attorney for the Debtor.
The current hourly rates of professionals at Matthew Johnson's
are:
Designation Rate
----------- ----
Attorneys $275
Law Clerks $130
Paralegals $125
To the best of the Debtor's knowledge, Matthew L. Johnson is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.
Headquartered in Las Vegas, Nevada, Claremont Technologies Corp.
develops the first and only independent lab certified device, the
Safe Cell Tab, which helps eradicate all cancer-causing radiation
from electromagnetic frequencies. The Company was subject to an
involuntary chapter 7 petition on March 25, 2005 (Bankr. D. Nev.
Case No. 05-12235). The Debtor consented to an entry of an order
for relief under chapter 11 on Aug. 24, 2005.
CORNERSTONE PRODUCTS: Court Okays Interim Use of Cash Collateral
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Texas
authorized Cornerstone Products, Inc., to continue using cash
collateral securing repayment of pre-petition obligations to Fleet
Capital Corporation, First United Bank and First United Bank
Venture Capital, on an interim basis.
The Debtor says that the proceeds of the cash collateral will be
used for winding down its business operations and liquidation of
its assets. A full-text copy of the budget covering the period
from Nov. 10, 2005, to Feb. 28, 2006 is available for free at:
http://researcharchives.com/t/s?31d
As adequate protection, the budget provides for the payment to
Fleet of any cash in the Cash Collateral Account in excess of the
amount needed to fund the budget. Any monies remaining after the
payment in full of Fleet's claims will be retained by the Debtor
subject to the liens, if any, of FUB pending of the Court's order.
The Debtor has agreed to grant to FUB replacement liens and
superpriority administrative claim status as was provided to
Fleet.
The Court will convene a final hearing at 3:30 a.m., on Nov. 29,
2005, to consider the Debtor's request to use the Cash Collateral
on a permanent basis.
Headquartered in Plano, Texas, Cornerstone Products, Inc.
-- http://www.cornerstoneproducts.com/-- manufactures custom
injection molded plastic products. The Company filed for
chapter 11 protection on July 5, 2005 (Bankr. E.D. Tex. Case No.
05-43533). Frank J. Wright, Esq., at Hance Scarborough Wright
Ginsberg & Brusilow, L.L.P., represents the Debtor in its
restructuring efforts. When the Debtor filed for protection from
its creditors, it listed total assets of $59,595,144 and total
debts of $65,714,015.
DANA CORPORATION: Bank Group Extends Reporting Default Waiver
-------------------------------------------------------------
Dana Corporation (NYSE: DCN) received a continuation and extension
of waivers related to its five-year bank facility and accounts
receivable securitization program and has amended the agreements
related to both facilities.
The new waivers extend the existing waivers under these agreements
from Nov. 30, 2005, to May 31, 2006, including waivers of the
principal financial covenants in the five-year bank facility. In
addition, they waive non-compliance with other covenants related
to the delayed filing or delivery of Dana's financial statements
for the third quarter of 2005, as well as for the earlier periods
that the company previously announced it will restate.
"We appreciate the support of our bank group. These waivers
provide us the flexibility and time to complete the restatements
in an orderly fashion," said Dana Chief Financial Officer Bob
Richter. "We look forward to working with our bank group on
additional modifications to the existing facilities or the
creation of successor facilities to address Dana's needs beyond
the expiration of the waivers."
As part of the amendment of the five-year bank facility, Dana and
its wholly-owned domestic subsidiaries are granting security
interests in certain domestic current assets and machinery and
equipment. As part of the amendment to the accounts receivable
securitization program, Dana's minimum corporate credit rating
required under the agreement has been reduced.
The new waivers under both agreements provide for early
termination in the event Dana is not able to deliver its restated
financial statements by Dec. 30, 2005. Dana expects to file its
restated financial statements with the Securities and Exchange
Commission prior to this date.
Restatement Update
Last week, Dana Corporation provided this additional information
related to the status of the restatement of its financial
statements and reaffirmed the expected impact of the restatement
on aggregate net income for the periods affected:
With reference to its announcements of Oct. 10, 2005, and
Oct. 18, 2005, relative to the restatement of its financial
statements, Dana's management and the Audit Committee of the
Board of Directors have determined that the restatement of
its 2004 financial statements will trigger the accounting
requirement to restate its financial statements for the years
2002 and 2003 and its financial results for the years 2000
and 2001. Consequently, Dana's financial statements for 2002
and 2003 and financial results for 2000 and 2001 can no
longer be relied upon.
The items requiring the restatements of the years prior to
2004 are unrelated to the company's ongoing internal
investigation. The restatement for these items will impact
only the timing of reported income, and not the cumulative
net income in the periods affected. Therefore, Dana still
expects that the net aggregate reduction in net income after
tax for all periods to be restated will remain in the $25
million to $45 million range, which was previously announced.
The company's conclusions were reached in consultation
with its independent registered public accounting firm,
PricewaterhouseCoopers LLP, and independent investigators
retained by the Audit Committee.
Dana is in the process of preparing amended reports on
Forms 10-Q/A for the first two quarters of 2005 and Form
10-K/A for the year ended December 31, 2004. The Form 10-K/A
for 2004 will include restated financial statements for each
of the years 2002 through 2004 and restated financial results
for the years 2000 and 2001 in the Selected Financial Data.
Potential Bond Indenture Default
In connection with the restatements announced on Oct. 10, Dana
notified the trustee under its Indentures dated Aug. 8, 2001 and
Mar. 11, 2002, that the company may have violated a covenant in
those Indentures with respect to furnishing financial statements
prepared in accordance with generally accepted accounting
principles. On Nov. 4, the trustee advised Dana that it had
notified the registered holders of the notes issued under those
Indentures of this possible violation and of Dana's intention to
restate its financial statements in the near term. Dana expects
to cure the possible violation by filing its financial statements
within the 60-day period provided in the Indentures.
About Dana Corporation
Dana Corporation -- http://www.dana.com/-- designs and
manufactures products for every major vehicle producer in the
world. Dana is focused on being an essential partner to
automotive, commercial, and off-highway vehicle customers, which
collectively produce more than 60 million vehicles annually. A
leading supplier of axle, driveshaft, engine, frame, chassis, and
transmission technologies, Dana employs 46,000 people in 28
countries. Based in Toledo, Ohio, the company reported sales of
$9.1 billion in 2004.
* * *
As reported in the Troubled Company Reporter on Oct. 25, 2005,
Standard & Poor's Ratings Services lowered its corporate credit
and senior unsecured debt ratings on Dana Corp. to 'BB' from
'BB+', and kept the ratings on CreditWatch with negative
implications.
DELPHI CORP: Union Coalition Rejects 24,000 Job Reductions
----------------------------------------------------------
The six unions representing 33,000 hourly workers at Delphi Corp.
vehemently rejected the company's latest "final offer" Nov. 16
that would slash 24,000 jobs in three years and force workers to
take huge pay cuts and accept major increases in health care
costs.
Yet Delphi plans to reward some 500 "key employees" with up to 10%
of the company's stock and cash bonuses of $87.9 million.
"Delphi's contract proposal was not designed to be a framework for
an agreement but a road map for confrontation. [The offer] is
ridiculous and they know it's ridiculous," says UAW President Ron
Gettelfinger.
Delphi, which declared bankruptcy Oct. 8, wants to lower wages by
more than 60 percent, making it even harder for workers to pay the
higher health care premiums, while salaried employees pay about
the same cost for health care premiums next year as they did this
year. Delphi also is preparing to ask the bankruptcy court for
permission to turn over the pension plan to the federal Pension
Benefit Guaranty Corp., which insures private pensions. Even if
Delphi drops the pension plan, regular payments to retirees are
expected to continue at full levels. General Motors has
guaranteed it would cover the portion of Delphi pensions not paid
by the government if the supplier went bankrupt before 2007. GM
spun off Delphi in 1999.
The six unions -- the UAW, IUE-CWA, United Steelworkers,
Electrical Workers, Machinists and Operating Engineers -- formed
the Mobilizing@Delphi coalition earlier this month to coordinate
their fight against Delphi's assault on working families and their
communities. The coalition held its first meeting Nov. 16 at
Solidarity House, the UAW headquarters in Detroit.
The group declared it will work together to deny Delphi any
opportunity to set one plant against another or one union against
another.
"We are united in our effort to craft a solution to Delphi's
current problems that makes sense for our members, for the company
and its investors and for the communities where we work and live,"
said the coalition in a joint statement.
"The AFL-CIO stands shoulder-to-shoulder with the Delphi workers
and their unions. Together we will fight to force Delphi
management to change the company's anti-working family strategy,"
says AFL-CIO President John Sweeney.
Meanwhile, the International Metalworkers' Federation, which
represents 25 million members in more than 100 countries
worldwide, pledged its support of the Delphi workers.
"The attempt by [Delphi CEO] Steve Miller to undermine the jobs,
wages and working conditions of your members through a radical
restructuring signifies a basic disdain and disrespect for workers
and their livelihoods," IMF General Secretary Marcello Malentacchi
wrote in a letter to the six unions.
Headquartered in Troy, Michigan, Delphi Corporation --
http://www.delphi.com/-- is the single largest global supplier of
vehicle electronics, transportation components, integrated systems
and modules, and other electronic technology. The Company's
technology and products are present in more than 75 million
vehicles on the road worldwide. The Company filed for chapter 11
protection on Oct. 8, 2005 (Bankr. S.D.N.Y. Lead Case No.
05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and
Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP,
represents the Debtors in their restructuring efforts. As of
Aug. 31, 2005, the Debtors' balance sheet showed $17,098,734,530
in total assets and $22,166,280,476 in total debts.
DEUTSCHE ALT-A: Moody's Rates Class B-2 Sub. Certificates at Ba2
----------------------------------------------------------------
Moody's Investors Service assigned Aaa ratings to the senior
certificates except certificates I-A-8 (rated Aa1) and II-A-8
(rated Aa1) issued by Deutsche Alt-A Securities Mortgage Loan
Trust Series 2005-5, and ratings ranging from Aa1 to Ba2 to the
subordinate certificates in the deal.
The securitization is backed by:
* National City (27%),
* Greenpoint (21%),
* MortgageIT (19%),
* First National Bank of Nevada (11%),
* Impac (7%), and
* various others (remaining 15%) originated fixed-rate Alt-A
mortgage loans acquired by Deutsche Bank Securities.
The ratings of the certificates are based primarily on:
* the credit quality of the underlying mortgages;
* the credit enhancement provided by subordination; and
* the legal structure of the transaction.
Moody's expects collateral losses to range from 0.70% to 0.90%.
National City Mortgage Co., Greenpoint Mortgage Funding, Inc., and
GMAC Mortgage Corporation will service the loans. Wells Fargo
Bank, N.A. will act as master servicer.
The complete rating actions are:
Deutsche Alt-A Securities Mortgage Loan Trust Mortgage Pass-
Through Certificates, Series 2005-5
* Class I-A-1, rated Aaa
* Class I-A-2, rated Aaa
* Class I-A-3, rated Aaa
* Class I-A-4, rated Aaa
* Class I-A-5, rated Aaa
* Class I-A-6, rated Aaa
* Class I-A-7, rated Aaa
* Class I-A-8, rated Aa1
* Class I-A-IO, rated Aaa
* Class II-A-1, rated Aaa
* Class II-A-2, rated Aaa
* Class II-A-3, rated Aaa
* Class II-A-4, rated Aaa
* Class II-A-5, rated Aaa
* Class II-A-6, rated Aaa
* Class II-A-7, rated Aaa
* Class II-A-8, rated Aa1
* Class II-A-IO, rated Aaa
* Class II-A-PO, rated Aaa
* Class R, rated Aaa
* Class M-1, rated Aa1
* Class M-2, rated Aa2
* Class M-3, rated Aa3
* Class M-4, rated A2
* Class M-5, rated A3
* Class M-6, rated Baa2
* Class M-7, rated Baa3
* Class B-1, rated Ba1
* Class B-2, rated Ba2
DIGITAL LIGHTWAVE: Sept. 30 Equity Deficit Widens to $44.7 Million
------------------------------------------------------------------
Digital Lightwave, Inc., delivered its financial statements for
the quarter ending Sept. 30, 2005, to the Securities and Exchange
Commission on Nov. 10, 2005.
The company reported net loss of $2,083,000 on $4,898,000 of net
sales for the quarter ending Sept. 30, 2005. At Sept. 30, 2005,
the company's balance sheet showed $9,465,000 in total assets,
$54,161,000 in total liabilities, and a $44,696,000 stockholders'
deficit.
A full-text copy of Digital Lightwave's quarterly financial
statements for the quarter ending Sept. 30, 2005, is available at
no charge at http://ResearchArchives.com/t/s?317
Based in Clearwater, Florida, Digital Lightwave, Inc., provides
the global communications networking industry with products,
technology and services that enable the efficient development,
deployment and management of high-performance networks. Digital
Lightwave's customers -- companies that deploy networks, develop
networking equipment, and manage networks -- rely on its offerings
to optimize network performance and ensure service reliability.
The Company designs, develops and markets a portfolio of portable
and network-based products for installing, maintaining and
monitoring fiber optic circuits and networks. Network operators
and telecommunications service providers use fiber optics to
provide increased network bandwidth to transmit voice and other
non-voice traffic such as internet, data and multimedia video
transmissions. The Company provides telecommunications service
providers and equipment manufacturers with product capabilities to
cost-effectively deploy and manage fiber optic networks. The
Company's product lines include: Network Information Computers,
Network Access Agents, Optical Test Systems, and Optical
Wavelength Managers. The Company's wholly owned subsidiaries are
Digital Lightwave (UK) Limited, Digital Lightwave Asia Pacific
Pty, Ltd., and Digital Lightwave Latino Americana Ltda.
As of Sept. 30, 2005, Digital Lightwave's equity deficit widened
to $44,696,000 from a $29,146,000 deficit at Dec. 31, 2004.
DRUGMAX INC: Names Three Appointees to Senior Management Team
-------------------------------------------------------------
DrugMax, Inc. (Nasdaq: DMAX) reported three recent senior
management appointments. The management appointments include:
(1) Lawrence D. Kososki, Senior Vice President of Business
Development & Sales;
(2) Thomas Ferranti, Vice President of Information Technology;
and
(3) Kenneth J. Yonika, Controller.
Ed Mercadante, R.Ph., Co-Chairman and Chief Executive Officer of
DrugMax, stated, "We are extremely pleased to welcome these
talented individuals, each having extensive experience and proven
leadership in their respective fields. With the addition of
Larry, Tom and Ken, we have continued to successfully strengthen
our management team and further aligned the Company's
organizational talent with its strategic focus of operating a
pharmacy and a specialty pharmaceutical business. At the same
time, we have better positioned the Company to both grow its
business and achieve operational improvements for the benefit of
DrugMax and its shareholders."
Mr. Kososki, Senior Vice President of Business Development &
Sales, will be directly responsible for growing the Company's core
pharmacy and specialty pharmaceutical business. Mr. Kososki
brings over 20 years of strategic sales and management experience
in the pharmacy industry. Most recently, Mr. Kososki was Regional
Vice President of Operations for Apria Healthcare Group, Inc., a
New York Stock Exchange listed home healthcare company focused on
home infusion therapy, respiratory therapy and medical equipment
sales. At Apria Mr. Kososki was responsible for one of the
Company's 15 regions and oversaw operations, logistics, revenue
management and clinical departments. In this role, Mr. Kososki
managed a regional team of 600 employees and revenues of $120
million. Prior to this, Mr. Kososki served as an Independent
Consultant to the institutional pharmacy sector and as Senior Vice
President of the Long Term Care Pharmacy Division at Sunscript
Pharmacy Corporation, a national institutional pharmacy company
that was acquired by Omnicare Inc. In this role, Mr. Kososki had
strategic sales and operational management responsibilities,
managing over 1200 employees and $250 million in revenues. Prior
to this, Mr. Kososki was a Regional Vice President and Director of
Pharmacy for Sunscript. Mr. Kososki earned his BS in Pharmacy
from the University of Connecticut and is a Licensed Pharmacist in
Connecticut and Massachusetts. Mr. Kososki also earned a Master
of Public Administration degree from American International
College.
Mr. Ferranti, the Company's new Vice President of Information
Technology, will be responsible for utilizing technology to
improve the Company's corporate, pharmacy location and financial
operations. Mr. Ferranti joins the Company with 18 years of
computer technology and business management experience and a
proven history of accomplishments in systems architecture,
development and network integration and operations. Mr. Ferranti
most recently served as Executive Vice President and Chief
Operating Officer for SourceOne, Inc., a provider of fulfillment,
document management and marketing services tailored to the
financial services industry. In this role, Mr. Ferranti helped
develop and execute a plan to control costs, increase customer
satisfaction and attain new sales for the Company. Prior to this,
Mr. Ferranti served as SourceOne's Vice President and Chief
Information Officer where he managed a staff of 50 and was
directly responsible for the Company's information technology,
client service architecture and call center operations. Before
joining SourceOne, Mr. Ferranti was a Senior Engineer at Aetna
Life & Casualty Company, where he was the primary engineer leading
many of Aetna Retirement Service's strategic technology
initiatives. At Aetna, Mr. Ferranti was also Manager of Remote
Access Engineering and a Senior Programmer. Mr. Ferranti is a
Certified Network Engineer and earned his BS in Computer Science
from Central Connecticut State University.
Mr. Yonika, Controller, will work closely with CFO, James Searson,
in managing the Company's financial reporting and compliance. Mr.
Yonika brings 18 years of accounting, financial reporting, audit,
tax and other finance and accounting experience with both public
companies and accounting firms. Mr. Yonika most recently served
as Manager of Financial Reporting for NASDAQ listed Invitrogen
Corporation, a leading developer, manufacturer, and marketer of
research tools to customers engaged in life sciences research and
the commercial manufacturing of genetically engineered products.
Mr. Yonika had overall responsibility for financial reporting and
management including the preparation and filing of the company's
SEC filings. Prior to this, Mr. Yonika held the Senior Finance
Position with ViaStar Media Corporation, an independent music
label and music and media distributor, where he was responsible
for all of the company's financial operations. In this role, Mr.
Yonika prepared the company for a listing on the American Stock
Exchange and assisted with its corporate restructuring as well as
the due diligence of multiple acquisitions. Mr. Yonika also held
the position of Lead Consultant with Pacific Crest Equities, Inc.,
a full service accounting, reporting and financial services firm
working with emerging publicly traded companies in various
industries including healthcare. Mr. Yonika's experience also
includes working with various public accounting firms such as KPMG
Peat Marwick. Mr. Yonika is a certified public accountant and
earned his BBA in Accounting at Western Connecticut State
University.
DrugMax, Inc. -- http://www.drugmax.com/-- is a specialty
pharmacy and drug distribution provider formed by the merger on
November 12, 2004 of DrugMax, Inc. and Familymeds Group, Inc.
DrugMax works closely with doctors, patients, managed care
providers, medical centers and employers to improve patient
outcomes while delivering low cost and effective healthcare
solutions. The Company is focused on building an integrated
specialty drug distribution platform through its drug distribution
and specialty pharmacy operations. DrugMax operates two drug
distribution facilities, under the Valley Drug Company and Valley
Drug South names, and 77 specialty pharmacies in 13 states under
the Arrow Pharmacy & Nutrition Center and Familymeds Pharmacy
brand names.
* * *
Going Concern Doubt
Deloitte & Touche LLP issued an unqualified audit report with an
explanatory paragraph raising doubt about the Company's ability to
continue as a going concern after completing its review of
DrugMax' 2004 financials.
EMERITUS ASSISTED: $26.62 Mil. of Convertible Sub. Notes Tendered
-----------------------------------------------------------------
Emeritus Assisted Living (AMEX: ESC) reported that $26.625 million
of its outstanding $32 million 6.25% Convertible Subordinated
Debentures due 2006 had been tendered for exchange in its exchange
offer as of Thursday, November 17, 2005.
The original expiration date of its exchange offer, including
withdrawal rights, has been extended and will now expire at
5:00 p.m., Eastern time, on Tuesday November 22, 2005, unless
further extended or terminated.
The exchange offer will be made only through and upon the terms
and conditions described in Emeritus's Offering Memorandum dated
October 18, 2005, as amended, and related letter of transmittal,
as amended.
Holders must tender their outstanding debentures prior to the
expiration date if they wish to participate in the exchange offer.
Any existing debentures that are not exchanged will remain
outstanding until the maturity date of the existing debentures in
January 2006. U.S. Bank, National Association is acting as
exchange agent for the offer.
Emeritus Assisted Living -- http://www.emeritus.com/-- is a
national provider of assisted living and related services to
seniors. Emeritus is one of the largest developers and operators
of freestanding assisted living communities throughout the United
States. These communities provide a residential housing
alternative for senior citizens who need help with the activities
of daily living with an emphasis on assistance with personal care
services to provide residents with an opportunity for support in
the aging process. Emeritus currently holds interests in 182
communities representing capacity for approximately 18,400
residents in 34 states.
As of September 30, 2005, Emeritus' equity deficit widened to
$134,220,000 from a $128,319,000 equity deficit at Dec. 31, 2004.
EMERITUS ASSISTED: Reports $134 Mil. Equity Deficit at Sept. 30
---------------------------------------------------------------
Emeritus Assisted Living, aka Emeritus Corporation (AMEX: ESC)
delivered its quarterly report on Form 10-Q for the quarterly
period ending Sept. 30, 2005, to the Securities and Exchange
Commission on Nov. 14, 2005.
The Company disclosed that it incurred a third quarter net loss to
common shareholders of $11.6 million compared to a net loss of
$6.5 million for the same quarter in 2004. Included in the
current quarter is an increase of approximately $5 million
associated with the Company's general and professional liability
insurance program and an increase from the prior year of
approximately $900,000 in Gulf Coast hurricane-related losses.
The Company reported that in comparing the net loss for 2005 and
2004, it is important to consider its property-related expenses,
which include depreciation and amortization, facility lease
expense, and interest expense that are directly related to its
communities, and which include capital lease accounting treatment,
finance accounting treatment, or straight-line accounting
treatment of rent escalators for many of our leases.
Those accounting treatments all result in greater property-related
expense than actual lease payments made in the early years of the
affected leases and less property-related expense than actual
lease payments made in later years.
The Company disclosed that it has incurred operating losses since
its inception in 1993, and as of September 30, 2005, it had an
accumulated deficit of approximately $210.9 million. The Company
believes that these losses have resulted from its early emphasis
on expansion, financing costs arising from multiple financing and
refinancing transactions related to this expansion, and occupancy
rates remaining lower for longer periods that it anticipated.
Emeritus Assisted Living, aka Emeritus Corporation --
http://www.emeritus.com/-- is a national provider of assisted
living and related services to seniors. Emeritus is one of the
largest developers and operators of freestanding assisted living
communities throughout the United States. These communities
provide a residential housing alternative for senior citizens who
need help with the activities of daily living with an emphasis on
assistance with personal care services to provide residents with
an opportunity for support in the aging process. Emeritus
currently holds interests in 182 communities representing capacity
for approximately 18,400 residents in 34 states.
As of Sept. 30, 2005, Emeritus Assisted's balance sheet showed a
$134,220,000 stockholders' deficit compared to a $128,319,000
deficit at Dec. 31, 2004
ENRON CORP: SK Corp. Withdraws Claims Following Stock Purchase
--------------------------------------------------------------
In 1988, Enron International Korea LLC, a non-debtor indirect
subsidiary of Enron Corp., and SK Corp. formed a joint venture in
Korea.
On Oct. 15, 2002, SK filed Claim No. 14350 against Enron, in
which SK asserts:
-- a $2,795,215 unsecured nonpriority claim for a "contract
claim/guarantee" related to the Stock Subscription and
Purchase Agreement dated December 10, 1998, with respect to
the joint venture SK-Enron; and
-- an unsecured nonpriority claim in an unspecified amount for
reimbursement of attorney's fees and other interest and
costs and expenses SK incurred.
The Debtors objected to the SK Claim alleging insufficient proof
and no amount was due based on their books and records.
Over the course of the past several years, a number of disputes
have arisen between EIK and SK. To resolve their disputes, EIK
and SK have engaged in arm's-length negotiations.
To resolve their disputes with SK and to maximize value for their
ultimate shareholders, the Debtors and EIK entered into a Stock
Purchase and Settlement Agreement with SK. EIK agreed to sell
its interest in SK-Enron to SK for valuable consideration and SK
agreed to withdraw its claim against Enron, with prejudice.
In conjunction with closing on the Agreement, EIK and SK, on
their own behalf and on behalf of their affiliates agreed to
release, waive and forever discharge the other from all claims,
defenses, causes of action, or obligations relating to their
disputes existing at any time prior to closing on the Agreement.
As previously reported in the Troubled Company Reporter, SK Corp.
purchased 999,999 shares in SK Enron, raising its stake in the
joint venture to 51% this month.
Headquartered in Houston, Texas, Enron Corporation --
http://www.enron.com/-- is in the midst of restructuring various
businesses for distribution as ongoing companies to its creditors
and liquidating its remaining operations. Before the company
agreed to be acquired, controversy over accounting procedures had
caused Enron's stock price and credit rating to drop sharply.
Enron filed for chapter 11 protection on December 2, 2001 (Bankr.
S.D.N.Y. Case No. 01-16033). Judge Gonzalez confirmed the
Company's Modified Fifth Amended Plan on July 15, 2004, and
numerous appeals followed. The Confirmed Plan took effect on
Nov. 17, 2004. Martin J. Bienenstock, Esq., and Brian S. Rosen,
Esq., at Weil, Gotshal & Manges, LLP, represent the Debtors in
their restructuring efforts. (Enron Bankruptcy News, Issue No.
162; Bankruptcy Creditors' Service, Inc., 15/945-7000)
EXCELLIGENCE LEARNING: Nasdaq Extends Filing Deadline to Dec. 30
----------------------------------------------------------------
Excelligence Learning Corporation (Nasdaq:LRNSE) reported that the
NASDAQ Listing Qualifications Panel has agreed to continue the
listing of the Company's securities on The NASDAQ Capital Market,
provided that the company files its quarterly reports on Form 10-Q
for the three months ended June 30, 2005 and Sept. 30, 2005, and
all restated financial statements for prior periods, on or before
Dec. 30, 2005.
As previously announced, the completion and review of the
company's quarterly reports have been delayed pending finalization
of the company's restatement of its financial statements as of and
for the year ended Dec. 31, 2004 and the quarter ended March 31,
2005.
The Panel had previously agreed to continue the listing of the
company's securities on The NASDAQ Capital Market provided that
the company filed its delinquent quarterly report for the period
ended June 30, 2005, and all restated financial statements for
prior periods, on or before Nov. 14, 2005. The company
subsequently notified the Panel that it would be unable to meet
that deadline, and requested a further extension of time, to
Dec. 30, 2005. In its Nov. 16, 2005 decision granting the
company's request, the Panel has indicated that it may not
consider further extensions to the Dec. 30, 2005 date.
As expected, the company has received a NASDAQ Staff Determination
Letter, dated Nov. 17, 2005, noting that the company's failure to
timely file its Form 10-Q for the quarter ended Sept. 30, 2005,
represents a second violation of Marketplace Rule 4310(c)(14), and
therefore serves as an additional basis for delisting the
company's securities from The NASDAQ Capital Market. Because the
Listing Qualifications Panel has already approved the company's
plan to bring all of its filings current by Dec. 30, 2005, the
company will not have to enter a second appeal in response to the
November 17 Staff Determination Letter.
In connection with its decision to grant the company's request for
a filing extension, the Panel has requested prompt notification of
any significant events that occur during the extension period. To
maintain its listing, the company must also demonstrate compliance
with all other continued listing requirements of The NASDAQ
Capital Market.
Although the company currently believes that it will be able to
meet the Panel's requirement that it regain compliance with
Marketplace Rule 4310(c)(14) by December 30, 2005, there can be no
guarantee that it will be able to file its outstanding quarterly
reports and all restatements by that date. If the company is
unable to meet the Panel's terms, the company's securities could
be delisted from The NASDAQ Capital Market.
Headquartered in Monterey, California, Excelligence Learning
Corporation -- http://www.excelligencelearning.com/-- is a
developer, manufacturer and retailer of educational products which
are sold to child care programs, preschools, elementary schools
and consumers. The company serves early childhood professionals,
educators, and parents by providing quality educational products
and programs for children from infancy to 12 years of age. With
its proprietary product offerings, a multi-channel distribution
strategy and extensive management expertise, the company aims to
foster children's early childhood and elementary education.
The company is composed of two business segments, Early Childhood
and Elementary School. Through its Early Childhood segment, the
company develops, markets and sells educational products through
multiple distribution channels primarily to early childhood
professionals and, to a lesser extent, consumers. Through its
Elementary School segment, the Company sells school supplies and
other products specifically targeted for use by children in
kindergarten through sixth grade to elementary schools, teachers
and other education organizations. Those parties then resell the
products either as a fundraising device for the benefit of a
particular school, student program or other community
organization, or as a service project to the school.
* * *
As reported in the Troubled Company Reporter on Sept. 15, 2005,
Excelligence Learning Corporation (Nasdaq:LRNSE) reported that, on
Sept. 7, 2005, and upon the recommendation of management, its
Board of Directors concluded that the company's previously issued
financial statements as of and for the year ended Dec. 31, 2004
and the quarter ended March 31, 2005, should not be relied upon
and should be restated. This conclusion was based on the results
of the previously announced internal investigation initiated by
the Company's Audit Committee to determine if the company
improperly failed to record and accrue for certain obligations for
the period and fiscal year ended Dec. 31, 2004.
Material Weakness
The circumstance of a restatement is a strong indicator that a
material weakness may have existed in the company's internal
control over financial reporting. Management is continuing to
evaluate whether there were one or more material weaknesses
related to the company's restatements.
FEDDERS CORP: Sells Thermal Management Biz to Laird for $17.4 Mil.
------------------------------------------------------------------
Fedders Corporation (NYSE: FJC) has sold its non-core thermal
management business, Melcor Corporation, to Laird Technologies,
Inc. of St. Louis, Missouri for $17.4 million in cash. Laird,
whose business is focused on thermal management technology, is a
division of a UK company, The Laird Group, PLC.
"The sale of Melcor will further enable Fedders to sharpen our
strategic focus and resources on our core residential, commercial
and industrial air treatment businesses," Fedders' President,
Michael Giordano said.
Fedders Corporation manufactures and markets worldwide air
treatment products, including air conditioners, air cleaners, gas
furnaces, dehumidifiers and humidifiers and thermal technology
products.
* * *
As reported in the Troubled Company Reporter on July 5, 2005,
Standard & Poor's Ratings Services lowered its corporate credit
ratings on air treatment products manufacturer Fedders Corp. and
Fedders North America Inc. to 'CC' from 'CCC'. At the same time,
Fedders North America's senior unsecured debt rating was lowered
to 'C' from 'CC'. S&P said the outlook remains negative.
FOAMEX INT'L: Lowenstein Sandler Approved as Committee's Counsel
----------------------------------------------------------------
The Official Committee of Unsecured Creditors of Foamex
International Inc., and its debtor-affiliates sought and obtainted
permission from the U.S. Bankruptcy Court for the District of
Delaware's permission to retain Lowenstein Sandler PC as its
counsel, nunc pro tunc to Sept. 30, 2005.
As the Committee's counsel, Lowenstein Sandler will:
(a) provide legal advice with respect to the Committee's
powers and duties as an official committee under Section
1102;
(b) assist the Committee in investigating the acts, conduct,
assets, liabilities and financial condition of the
Debtors, the operation of the Debtors' business, potential
claims, and any other matters relevant to the formulation
of a plan of reorganization;
(c) participate in the formulation of a plan;
(d) provide legal advice with respect to any disclosure
statement and plan filed and with respect to the process
for approving or disapproving disclosure statements and
confirming or denying confirmation of a plan;
(e) prepare the necessary applications, motions, complaints,
answers, orders, agreements and other legal papers;
(f) appear in Court to present necessary motions, applications
and pleadings, and otherwise protecting the interests of
those represented by the Committee;
(g) assist the Committee in requesting the appointment of a
trustee or examiner, should the action be necessary; and
(h) perform other legal services as may be required and be in
the interest of the Committee and creditors.
Lowenstein Sandler will be paid on an hourly basis in accordance
with the firm's ordinary and customary rates:
Professional Hourly Rates
------------ ------------
Partners $320-$595
Counsel $265-$425
Associates $165-$300
Legal Assistants $75-$150
Kenneth A. Rosen, Esq., a member of Lowenstein Sandler, assures
the Court that the firm represents no other entity in connection
with the Debtors' Chapter 11 cases, is a "disinterested person"
as that term is defined in Section 101(14), and does not hold or
represent any interest adverse to the Committee with respect to
the matters on which it is to be employed.
However, Mr. Rosen discloses that Lowenstein Sandler currently
represents these entities in matters wholly unrelated to the
Debtors' bankruptcy cases:
* JP Morgan Chase Bank, NA
* PNC Bank, NA
* BASF Corporation
Headquartered in Linwood, Pa., Foamex International Inc. --
http://www.foamex.com/-- is the world's leading producer of
comfort cushioning for bedding, furniture, carpet cushion and
automotive markets. The Company also manufactures high-
performance polymers for diverse applications in the industrial,
aerospace, defense, electronics and computer industries. The
Company and eight affiliates filed for chapter 11 protection on
Sept. 19, 2005 (Bankr. Del. Case Nos. 05-12685 through 05-12693).
Attorneys at Paul, Weiss, Rifkind, Wharton & Garrison LLP,
represent the Debtors in their restructuring efforts. Houlihan,
Lokey, Howard and Zukin and O'Melveny & Myers LLP are advising the
ad hoc committee of Senior Secured Noteholders. As of July 3,
2005, the Debtors reported $620,826,000 in total assets and
$744,757,000 in total debts. (Foamex International Bankruptcy
News, Issue No. 6; Bankruptcy Creditors' Service, Inc.,
215/945-7000)
FOAMEX INT'L: Panel Taps Jefferies & Company as Financial Advisor
-----------------------------------------------------------------
The Official Committee of Unsecured Creditors appointed in Foamex
International Inc., and its debtor-affiliates' Chapter 11 cases
contends that the services of a financial advisor is necessary and
appropriate to evaluate the complex financial and economic issues
raised by the Debtors' reorganization proceedings and to
effectively fulfill its statutory duties.
The Committee wants to retain Jefferies & Company, Inc., as its
financial advisor because the firm has expertise in providing
financial advisory services to debtors and creditors in
restructurings and distressed situations.
According to Committee Chairman J. Donald Hamilton, Jefferies has
extensive experience in reorganization cases and has an excellent
reputation for services it has rendered in large and complex
Chapter 11 cases.
Pursuant to Sections 328(a) and 1103 of the Bankruptcy Code, the
Committee sought and obtained the U.S. Bankruptcy Court for the
District of Delaware's permission to retain Jefferies as its
financial advisor, effective as of October 6, 2005.
As the Committee's financial advisor, Jefferies will:
(a) familiarize with and analyze the business, operations,
assets, financial condition and prospects of the Debtors;
(b) advise the Committee on the current state of the
"restructuring market";
(c) assist and advise the Committee in examining and analyzing
any potential or proposed strategy for restructuring or
adjusting the Debtors' outstanding indebtedness or overall
capital structure, including, assisting the Committee in
developing its own strategy for accomplishing a
Restructuring;
(d) assist and advise the Committee in evaluating and
analyzing the proposed implementation of any
Restructuring, including the value of the securities, if
any, that may be issued under any plan of reorganization;
and
(e) render other financial advisory services as may from time
to time be agreed upon by the Committee and Jefferies,
including, but not limited to providing expert testimony,
and other expert and financial advisory support related to
any threatened, expected or initiated litigation.
Jefferies will be paid pursuant to this Fee Structure:
A. Monthly Fee: $150,000
B. Transaction Fee equal to the greater of:
* $500,000; or
* 1% of any recoveries by unsecured creditors.
A credit equal to 33% of all Monthly Fees paid to Jefferies
will be applied against the portion of any Transaction Fee
in excess of $500,000. The Transaction Fee is due and
payable on the earlier of (i) the date of receipt of
recoveries or interests by unsecured creditors, or (ii) the
effective date of a plan of reorganization.
In addition, Jefferies will be reimbursed of all reasonable and
documented out-of-pocket expenses incurred in connection with the
Debtors' Chapter 11 cases.
Jefferies has indicated to the Committee that it is not the
general practice of investment banking firms to keep detailed
time records similar to those customarily kept by attorneys.
Accordingly, the Court waives the requirements set in Local Rule
2016-2.
Michael J. Henkin, a Senior Vice President at Jefferies, attests
that the firm does not hold or represent any interest adverse to
the estate that would impair its ability to objectively perform
professional services to the Debtor and is a "disinterested
person" as that term is defined in Section 101(14) of the
Bankruptcy Code.
With more than 80,000 customer accounts around the world, it is
possible that one of Jefferies clients may hold a claim or
otherwise be an interested party in the Debtors' chapter 11
cases, Mr. Henkin says.
Mr. Henkin asserts that neither Jefferies, nor any of its
employees is or was, within three years before the commencement
of the bankruptcy cases, an investment banker for the Debtors.
However, in March 2002, Jefferies acted as a Joint Book-Running
Manager in the issuance of the Debtors' 10-3/4% Senior Secured
Notes due 2009.
Mr. Hamilton discloses that the Debtors and their estates will
indemnify Jefferies for all claims, damages, liabilities and
expenses, except to the extent that the claims, damages,
liabilities and expenses resulted principally from the firm's
gross negligence or willful misconduct.
Headquartered in Linwood, Pa., Foamex International Inc. --
http://www.foamex.com/-- is the world's leading producer of
comfort cushioning for bedding, furniture, carpet cushion and
automotive markets. The Company also manufactures high-
performance polymers for diverse applications in the industrial,
aerospace, defense, electronics and computer industries. The
Company and eight affiliates filed for chapter 11 protection on
Sept. 19, 2005 (Bankr. Del. Case Nos. 05-12685 through 05-12693).
Attorneys at Paul, Weiss, Rifkind, Wharton & Garrison LLP,
represent the Debtors in their restructuring efforts. Houlihan,
Lokey, Howard and Zukin and O'Melveny & Myers LLP are advising the
ad hoc committee of Senior Secured Noteholders. As of July 3,
2005, the Debtors reported $620,826,000 in total assets and
$744,757,000 in total debts. (Foamex International Bankruptcy
News, Issue No. 6; Bankruptcy Creditors' Service, Inc.,
215/945-7000)
FOAMEX INT'L: Saul Ewing Approved as Committee's Local Counsel
--------------------------------------------------------------
The Official Committee of Unsecured Creditors of Foamex
International Inc., and its debtor-affiliates sought and obtained
the U.S. Bankruptcy Court for the District of Delaware's authority
to retain Saul Ewing LLP as its Delaware counsel, nunc pro tunc to
September 30, 2005. Saul Ewing will perform necessary legal
services during the Debtors' Chapter 11 cases.
J. Donald Hamilton, Committee Chair, asserts that the retention
of Saul Ewing as counsel is essential to the Committee. Saul
Ewing and Lowenstein Sandler PC, the Committee's lead counsel,
will make every effort to prevent any needless duplication of
effort. Pursuant to Local Rule 83.5(c) and because the members
of Lowenstein Sandler are not Delaware lawyers, the retention of
Saul Ewing as Delaware counsel is necessary, Mr. Hamilton says.
The Committee chose to retain Saul Ewing as its local counsel
because of the firm's:
-- experience and knowledge in the field of creditor's rights
and business reorganizations; and
-- proximity to the Court, which gives it the ability to
respond quickly to emergency hearings and other emergency
matters in the Court.
Saul Ewing will, among others:
(a) provide legal advise with respect to the Committee's
rights, powers and duties;
(b) prepare all necessary applications, answers, responses,
objections, orders, reports and other legal papers;
(c) represent the Committee in any and all matters arising in
the cases including any dispute or issue with the Debtors,
alleged secured creditors and other third parties;
(d) assist the Committee in its investigation and analysis of
the Debtors, including but not limited to, the review and
analysis of all pleadings, claims and plans of
reorganization that may be filed in the Debtors' cases and
any negotiations or litigation that may arise out of or in
connection with the matters, operations and financial
affairs;
(e) represent the Committee in all aspects of confirmation
proceedings; and
(f) perform all other legal services for the Committee that
may be necessary or desirable in the proceedings.
Saul Ewing will be paid based on its current standard hourly
rates:
Individual Hourly Rates
---------- ------------
Mark Minuti, Esq. (partner) $450
Donald J. Detweiler, Esq. (partner) $375
Jeremy W. Ryan, Esq. (associate) $315
Patrick J. Reilley, Esq. (associate) $240
Monica A. Molitor (paralegal) $155
Veronica Parker (clerk) $90
Other attorneys and paralegals may also, from time to time,
perform services for the Committee, based on their areas of
expertise and the Committee's needs.
The firm will also be reimbursed of its actual and necessary
expenses.
Donald J. Detweiler, Esq., a partner at Saul Ewing, assures the
Court that the firm does not hold or represent any interest
adverse to the Committee. Saul Ewing is a "disinterested person"
as that term is defined in Section 101(14) of the Bankruptcy
Code.
Headquartered in Linwood, Pa., Foamex International Inc. --
http://www.foamex.com/-- is the world's leading producer of
comfort cushioning for bedding, furniture, carpet cushion and
automotive markets. The Company also manufactures high-
performance polymers for diverse applications in the industrial,
aerospace, defense, electronics and computer industries. The
Company and eight affiliates filed for chapter 11 protection on
Sept. 19, 2005 (Bankr. Del. Case Nos. 05-12685 through 05-12693).
Attorneys at Paul, Weiss, Rifkind, Wharton & Garrison LLP,
represent the Debtors in their restructuring efforts. Houlihan,
Lokey, Howard and Zukin and O'Melveny & Myers LLP are advising the
ad hoc committee of Senior Secured Noteholders. As of July 3,
2005, the Debtors reported $620,826,000 in total assets and
$744,757,000 in total debts. (Foamex International Bankruptcy
News, Issue No. 6; Bankruptcy Creditors' Service, Inc.,
215/945-7000)
FREDERICK MCNEARY: Argues Chapter 11 Trustee Unnecessary
--------------------------------------------------------
Frederick J. McNeary, Sr., president and shareholder of Prestwick
Chase, Inc., wants the U.S. Bankruptcy Court for the Northern
District of New York to deny APC Partners II, LLC's request for
the appointment of either a chapter 11 trustee or an examiner in
both his and Prestwick's separate bankruptcy cases.
APC, which holds approximately $4.2 million in secured claims
against the estates of Mr. McNeary and Prestwick, asked for the
appointment of a chapter 11 Trustee after concluding that
Prestwick's business has been seriously mismanaged.
As reported in the Troubled Company Reporter on Oct. 2, 2005,
APC's accusations included, among other things:
a) Prestwick's prepetition misappropriation of over $300,000
in tenant security deposits;
b) failure to disclose financial information such as bank
records, accurate rent rolls, provide certifications of
financial disclosures;
c) improper payments of Prestwick to or for the benefit of
insiders;
d) Mr. McNeary Sr.'s failure to acknowledge or act upon
meritorious and valuable causes of action involving his
home in Saratoga Springs and golf community condominium in
the Palm Beach area of Florida;
e) management inexperience in Prestwick's business; and
f) failure to file a plan of reorganization.
Mr. McNeary's Side of the Story
Mr. McNeary says APC's request for the appointment of a chapter 11
Trustee or an examiner is unwarranted because APC has not met its
burden of proof to support such an extraordinary remedy.
Mr. McNeary says that none of APC's allegations address
improprieties in his personal bankruptcy case. APC's motion,
according to Mr. McNeary, focuses exclusively on Prestwick's
bankruptcy case.
Mr. McNeary says that APC has failed to show that he is not
trustworthy and that the local business community lacks confidence
in him. He adds that no other creditor supports the appointment
of a chapter 11 Trustee or examiner.
Mr. McNeary refutes APC's insinuations that he has tried to
conceal certain of his assets.
APC had accused Mr. McNeary of failing to disclose the 10 shares
of Putnam Brook stock he owns as well as a $50,000 prepetition
transfer made to his wife's account to pay for hurricane damage on
a townhouse in Florida.
Mr. McNeary contends that the omission was a plain administrative
oversight and therefore does not rise to the level of fraud
suggested by APC. In fact, Mr. McNeary says APC has failed to
show that he has been uncooperative in the disclosure of relevant
financial information.
Headquartered in Saratoga Springs, New York, Prestwick Chase, Inc.
-- http://www.prestwickchase.com/-- offers senior housing and
independent living as an alternative to home ownership. The
Company filed for chapter 11 protection on March 11, 2005 (Bankr.
N.D.N.Y. Case No. 05-11456). Robert J. Rock, Esq., at Albany, New
York, represents the Debtor in its restructuring efforts. When
the Debtor filed for protection from its creditors, it estimated
assets and debts of $10 million to $50 million.
Frederick J. McNeary, Sr., is a real estate developer and broker.
He is also a shareholder of bankrupt Prestwick Chase, Inc., which
filed for chapter 11 protection on March 11, 2005 (Bankr. N.D.N.Y.
Case No. 05-11456). Mr. McNeary filed for chapter 11 protection
on April 29, 2005 (Bankr. N.D.N.Y. Case No. 05-13007). Howard M.
Daffner, Esq., at Segel, Goldman, Mazzotta & Siegel, P.C.,
represents the Debtor. When Mr. McNeary filed for protection from
his creditors, he estimated less than $50,000 in assets and listed
$10 million to $50 million in debts.
GE COMMERCIAL: S&P Places Low-B Ratings on $57.3-Mil Cert. Classes
------------------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary
ratings to GE Commercial Mortgage Corp.'s $2.412 billion
commercial mortgage pass-through certificates series 2005-C4.
The preliminary ratings are based on information as of Nov. 21,
2005. Subsequent information may result in the assignment of
final ratings that differ from the preliminary ratings.
The preliminary ratings reflect the credit support provided by:
* the subordinate classes of certificates,
* the liquidity provided by the trustee,
* the economics of the underlying loans, and
* the geographic and property type diversity of the loans.
Classes A-1, A-2FX, A-2FL, A-3, A-SB, A-4, A-1A, A-M, A-J, B, C,
D, and E are currently being offered publicly. The remaining
classes will be offered privately. Standard & Poor's analysis
determined that, on a weighted average basis, the pool has a debt
service coverage of 1.37x, a beginning LTV of 105.9%, and an
ending LTV of 94.7%.
A copy of Standard & Poor's complete presale report for this
transaction can be found on RatingsDirect, Standard & Poor's
Web-based credit analysis system, at http://www.ratingsdirect.com/
The presale can also be found on the Standard & Poor's Web site at
http://www.standardandpoors.com/ Select Credit Ratings, and then
find the article under Presale Credit Reports.
Preliminary Ratings Assigned
GE Commercial Mortgage Corp.
Recommended
Class Rating Amount credit support
----- ------ ------ --------------
A-1 AAA $102,300,000 30.000%
A-2FX AAA $100,000,000 30.000%
A-2FL AAA $125,900,000 30.000%
A-3 AAA $222,100,000 30.000%
A-SB AAA $141,070,000 30.000%
A-4 AAA $782,600,000 30.000%
A-1A AAA $214,384,000 30.000%
A-M AAA $241,193,000 20.000%
A-J AAA $153,761,000 13.625%
B AA+ $24,119,000 12.625%
C AA $30,149,000 11.375%
D AA- $24,120,000 10.375%
E A $45,223,000 8.500%
F A- $27,135,000 7.375%
G BBB+ $33,164,000 6.000%
H BBB $24,119,000 5.000%
J BBB- $27,134,000 3.875%
K BB+ $12,060,000 3.375%
L BB $12,060,000 2.875%
M BB- $9,044,000 2.500%
N B+ $9,045,000 2.125%
O B $6,030,000 1.875%
P B- $9,045,000 1.500%
Q NR $36,179,314 0.000%
X-W* AAA TBD N/A
* Interest-only class with a notional dollar amount.
NR -- Not rated.
TBD -- To be determined.
N/A -- Not applicable.
GENERAL MOTORS: Reduction Plans Prompt S&P to Review Ratings
------------------------------------------------------------
Standard & Poor's Ratings Services said that its ratings on
General Motors Corp., General Motors Acceptance Corp., and all
related entities, including GMAC's subsidiary, Residential
Capital Corp. remain on CreditWatch, where they were placed on
Oct. 3, 2005.
This CreditWatch update follows GM's announcement of further
capacity and headcount reductions in North America. GM's 'BB-'
long-term and 'B-2' short-term ratings are on CreditWatch with
negative implications. GMAC's 'BB/B-1' ratings and ResCap's
'BBB-/A-3' ratings are on CreditWatch with developing
implications. Consolidated debt outstanding totaled $285 billion
at Sept. 30, 2005.
The reductions will be substantial:
* Annual assembly capacity is to be cut by a further 1
million units by 2008, to 4.2 million units, and
* an additional 5,000 jobs will be cut in manufacturing,
beyond the 25,000 previously targeted. The manpower
reductions are to be achieved mostly through attrition and
early retirement programs.
GM has not yet disclosed the restructuring charges and cash costs
related to these actions, but S&P expects these to be substantial.
The CreditWatch listing on GM reflects:
* The recent precipitous deterioration in GM's product mix in
North America and ongoing decline in its market share; S&P
now have significantly diminished expectations for the
profit potential of GM's soon-to-be-introduced new family
of midsize and large SUVs;
* More broadly, the sales and pricing outlook for GM's
products. Having lowered list prices on many of its models
in the hopes of curtailing incentives, GM has now announced
a new incentive program. Moreover, full-size pickups, GM's
only other major source of automotive earnings, may face
challenges in 2006;
* The adequacy of GM's strategies for improving its cost
position, despite the announcements of Nov. 21 and the
concessions recently obtained from its principal labor
union, the United Auto Workers, which will reduce somewhat
its burdensome health care costs;
* The potential adverse consequences for GM of Delphi Corp.'s
bankruptcy filing, given that GM now faces the prospect of
supply disruptions resulting from work stoppages at Delphi
and/or demands for price relief from Delphi, as well as the
need to honor its guarantee of certain pension and retiree
medical liabilities of Delphi; and
* The ongoing SEC investigation of GM's accounting practices,
although this is a lesser consideration.
The CreditWatch listing on GMAC reflects the potential that GM
could cede its ownership control over GMAC. GM has announced that
it is considering the sale of a controlling interest in GMAC to
restore GMAC's investment-grade rating.
S&P views an investment-grade rating for GMAC as feasible if GM
sells a majority stake in GMAC to a highly rated financial
institution with a long-range strategic commitment to the
automotive finance sector. GMAC still would be exposed to risks
stemming from its role as a provider of funding support to GM's
dealers and retail customers. However, S&P believes a strategic
majority owner would cause GMAC to adopt a defensive underwriting
posture by curtailing its funding support of GM's business if that
business were perceived to pose heightened risks to GMAC.
The ratings on ResCap are two notches above the ratings on its
direct parent, GMAC, reflecting ResCap's ability to operate its
mortgage businesses separately from GMAC's auto finance business,
as ResCap is partially insulated from them by financial covenants
and governance provisions. However, S&P continues to link the
ratings on ResCap with GMAC's because of the latter's full
ownership of ResCap. Consequently, should the ratings on GMAC be
lowered, the ratings on ResCap would likewise be lowered by the
same amount. Alternatively, if the ratings on GMAC were raised,
ResCap's ratings also could be raised.
S&P expects to resolve the reviews on GM, GMAC, and ResCap by
mid- to late January, but could revise this timetable if ongoing
developments warrant. Lowering GM's ratings by more than one
notch is possible, given the magnitude of the challenges the
company faces. S&P's primary areas of focus will remain GM's
business and financial challenges in North America and any plans
for restructuring and cost reductions.
GENERAL MOTORS: Moody's Affirms Corporate Family Rating at B1
-------------------------------------------------------------
Moody's Investors Service affirmed the B1 Corporate Family and
long-term ratings and the SGL-1 speculative grade liquidity rating
of General Motors Corporation; the rating outlook remains
negative. Moody's review of GMAC's ratings is continuing (Ba1
senior unsecured, on review with direction uncertain and Not Prime
short-term, on review for possible upgrade).
The affirmation of the GM rating follows the company's
announcement that it will implement a major restructuring program
designed to significantly reduce North American capacity and lower
fixed costs. Moody's said that a GM restructuring program was
contemplated in its November 1st, 2005 downgrade of the company's
long-term rating to B1 from Ba2. The rating agency further stated
that the finalization of a number of critical assumptions and
expectations underlying the plan will play an important role in
its assessment of the degree to which the plan will help GM re-
establish a competitive business model and improve its long-term
operating and financial performance. Consequently, the
restructuring, as announced, does not merit any change in the
status of GM's B1 rating and negative outlook.
As the various restructuring-related assumptions and expectations
are resolved, other risk factors identified by Moody's in its
November 1st rating action will remain critical to GM's near-term
credit quality and its ability to support the B1 rating. These
factors, which also underpin the negative rating outlook, include:
1) the resolution of the SEC inquiry into various GM accounting
practices and any impact that this might have on the
company's ability to file financial statements in a timely
manner, to proceed with the sale of a majority stake in
GMAC, and to affirm the effectiveness of its accounting
controls and procedures;
2) the risk that a UAW strike or work action at Delphi could
severely impair GM's North American operations;
3) the possibility that a resolution of the Delphi
reorganization could entail a material cash cost to GM; and
4) the completion of the sale of the majority stake in GMAC
which will help fund the cash costs of the restructuring
program.
Moody's believes that an additional near-term factor that could
impact GM's rating is the Pension Benefit Guarantee Corporation's
(PBGC) concern about the termination value of GM's US pension
plan, and the potential that this could impede the sale of the
GMAC stake or reduce the net proceeds received by GM.
Moody's notes that GM could deploy the proceeds from the GMAC sale
to cover:
* the cash outflows associated with the restructuring
initiative;
* payments to assist in the resolution of the Delphi
reorganization;
* any additional contribution to its US pension plan in
response to the PBGC's concerns; and
* any automotive operating cash consumption through 2006.
However, Moody's believes that utilizing the GMAC sale proceeds to
defray such expenditures would result in a material erosion in
GM's overall credit metrics. The dividend stream from the finance
subsidiary would likely have been significantly reduced by the
sale, but there would be no offsetting increase in GM's overall
liquidity or reduction in its leverage and debt service
obligation. Consequently, large cash outflows relating to the
restructuring, Delphi, pension contributions, or operating losses
could result in pressure on GM's rating notwithstanding the inflow
of funds from the GMAC sale.
Moody's believes that GM's restructuring program has constructive
elements. It anticipates that by 2008 approximately 30,000 hourly
positions will have been eliminated and that North American, two-
shift production capacity will have been reduced to 4.2 million
units per year from a current level of 5.2 million units. Moody's
believes that a successful restructuring initiative to reduce
capacity in line with GM's declining North American market share
position will be critical to the company's ability to establish a
competitive and sustainable business model.
However, key drivers of the plan's success will be the degree to
which it is based on realistically achievable expectations for
market share, product mix and pricing. Moreover, the plan must be
agreed to by the UAW, and the cash costs of implementing the plan
and funding employee separation costs have not been finalized.
Moody's assessment of the plan and its impact on GM's credit
quality will focus on the size and timing of any contemplated cash
savings, and the degree to which the assumptions underlying the
plan are achievable.
General Motors Corporation, headquartered in Detroit, Michigan, is
the world's largest producer of cars and light trucks. GMAC, a
wholly-owned subsidiary of GM, provides retail and wholesale
financing in support of GM's automotive operations and is one of
the world's largest non-bank financial institutions.
GRAHAM PACKAGING: Delivers Amended Financial Statements to SEC
--------------------------------------------------------------
Graham Packaging Holdings Company delivered three sets of Amended
Financial Statements for the year ended Dec. 21, 2004, and for the
quarters ending Mar. 31, 2005, and June 30, 2005, to the
Securities and Exchange Commission on Nov. 14, 2005.
The company filed the amended financial statements to correct a
misclassification between current deferred income tax assets and
non-current deferred income tax liabilities. The company also
filed the amended and restated monitoring agreement.
Under an amended and restated monitoring agreement entered on
Sept. 30, 2004, among Blackstone Investors, Graham Family
Investors, Holdings and the Operating Company, Blackstone will
receive a $3 million yearly monitoring fee and the Graham Family
Investors receive a $1 million yearly monitoring fee.
The effect of the restatement is to reduce current deferred income
tax assets, total current assets and non-current deferred income
tax liabilities by $46.6 million as of Dec. 31, 2004.
At Dec. 31, 2004, Graham Packaging's Balance Sheet showed:
Total Assets $2,505,000,000
Total Liabilities 2,465,200,000
Total Stockholders' Equity Deficit ($434,100,000)
At Mar. 31, 2005, Graham Packaging's Balance Sheet showed:
Total Assets $2,586,192,000
Total Liabilities 3,017,393,000
Total Stockholders' Equity Deficit ($445,407,000)
At June 30, 2005, Graham Packaging's Balance Sheet showed:
Total Assets $2,562,228,000
Total Liabilities 3,019,451,000
Total Stockholders' Equity Deficit ($457,223,000)
Full-text copies of Graham Packaging Holdings Company's Amended
Financial Statements are available for free at:
* for the year ending Dec. 31, 2004
http://ResearchArchives.com/t/s?310
* for the first quarter ending Mar. 31, 2005
http://ResearchArchives.com/t/s?311
* for the second quarter ending Jun. 30, 2005
http://ResearchArchives.com/t/s?312
Headquartered in York, Pennsylvania, Graham Packaging Holdings
Company -- http://www.grahampackaging.com/-- is a leading U.S.
supplier of plastic containers for hot-fill juice and juice
drinks, sports drinks, drinkable yogurt and smoothies, nutritional
supplements, wide-mouth food, dressings, condiments, and beers;
the leading global supplier of plastic containers for yogurt
drinks; and the number-one supplier in the U.S., Canada, and
Brazil of one-quart/one-liter plastic HDPE (high-density
polyethylene) containers for motor oil.
The Blackstone Group of New York is Graham Packaging's majority
owner.
As of Sept. 30, 2005, the company's balance sheet showed
$450,722,000 stockholders' deficit, compared to $434,100,000
deficit at Dec. 31, 2004.
HINES HORTICULTURE: Low Performance Cues S&P to Shave Debt Ratings
------------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on Irvine,
California-based Hines Horticulture Inc., including corporate
credit rating to 'B' from 'B+'.
The ratings on the $40 million term loan due 2008 were withdrawn
following repayment of the $30.5 million outstanding balance. The
outlook is negative. Hines had about $210 million of total debt
outstanding at Sept. 30, 2005.
"The downgrade reflects Standard & Poor's continued concerns about
challenging industry conditions that may further pressure the
company's softer-than-expected operating performance," said
Standard & Poor's credit analyst Alison Sullivan.
Hines has been negatively affected in the past two years by severe
weather in key regions, and rising costs associated with fuel and
third-party merchandising. Furthermore, the company is
increasingly dependent on mass merchant and home center customers,
and subject to pricing pressure due to nursery and garden retailer
liquidations and industry overcapacity.
Hines' operating performance was soft in the first nine months of
2005. Sales and EBITDA fell 1% and 21%, respectively, compared to
the first nine months of 2004. Hurricanes Katrina and Rita hurt
performance and led to some structural and crop damage at the
Miami facility, the latter of which is insured under the Federal
Crop Insurance Act. Lingering effects of the hurricanes, along
with additional impact from Hurrican Wilma, will continue
into the fourth quarter.
HYDROCHEM INDUSTRIAL: S&P Affirms B Corporate Credit Rating
-----------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B' corporate
credit rating and other ratings on HydroChem Industrial Services
Inc. and removed them from CreditWatch where they were placed with
negative implications on Sept. 28, 2005.
The outlook is stable. Total debt outstanding was $174 million as
of Sept. 30, 2005.
The rating actions reflect the company's ability to withstand many
of the operating challenges it faced as a result of late summer
hurricanes in the Gulf Coast region.
"While credit measures weakened slightly in recent months because
of the hurricanes, we expect ratios will return to levels
appropriate for the rating in the near to intermediate term," said
Standard & Poor's credit analyst Robyn Shapiro.
The ratings on Deer Park, Texas-based HydroChem reflect a modest
scope of operations:
* revenues of just over $200 million,
* high debt leverage, and
* minimal free cash generation.
These factors are only somewhat offset by the company's position
as a leading participant in the $2 billion market for domestic
industrial cleaning services.
HydroChem offers high-pressure water cleaning/ hydroblasting,
chemical cleaning, industrial vacuuming, tank cleaning, and
related services to the petrochemical, oil refining, utilities,
and other process industries. Services offered are typically part
of customers' recurring maintenance programs that improve
operating efficiency and extend the useful lives of equipment and
facilities.
HydroChem provides services to approximately 1,000 customers from
its 93 operating locations throughout the U.S. Customer
concentration is significant as more than 70% of revenues were
derived from the 20 largest customers during 2004. However,
long-term contracts with well-established customers, including the
10 largest domestic petrochemical and oil refining companies and
eight of the 10 largest domestic utility companies, should
somewhat mitigate credit risk derived from customer concentration.
The markets served are highly competitive, mature, and prone to
cyclical swings in operating results. Consequently, HydroChem's
earnings could trend downward during periods of low capacity
utilization in the petrochemical industry, as was the case in 2001
and 2002. The company is also somewhat vulnerable to high fuel
costs, although some of the increase is likely to be passed
through to customers.
As a result of the recent hurricanes in the Gulf Coast region,
many refineries deferred ongoing maintenance while plants were
closed or had operations disrupted. However, most of these
refineries have resumed operations faster than anticipated and,
consequently, HydroChem has been able to resume services for its
customers in that region.
HydroChem has also begun to face higher labor costs in this region
due to the displacement of labor after the hurricanes. However,
management is confident the company can pass these increased labor
costs on to its customers.
INFRASOURCE INC: Moody's Affirms $169 Million Debts' Ba3 Ratings
----------------------------------------------------------------
Moody's Investors Service affirmed the ratings of InfraSource Inc.
including the company's Ba3 corporate family rating, and changed
the company's ratings outlook to negative. The change in outlook
reflects the company's currently weak free cash flow generation
and concerns related to the company's ability to significantly
improve its cash flow on a sustainable basis over the short term.
Moody's notes that the company has announced that it expects to
see an improvement in its free cash flow in the fourth quarter.
These ratings have been affirmed:
* $85 million revolving credit facility due 2009, rated Ba3
* $84 million term loan due 2010, rated Ba3
The ratings outlook has been changed to negative from stable.
InfraSource's rating affirmation hinges on the belief that the
company will successfully translate its large accounts receivable
position into positive free cash flow as it prioritizes return on
investment on a project by project basis and focuses its bidding
toward higher margin opportunities even if this means lower
revenue growth. The change to a negative outlook reflects the
belief that the company's initiatives to improve its free cash
flow will take time and that the company's prospective free cash
flow generation may prove weak for the ratings category even after
anticipated initiatives.
The affirmation reflects the company's debt to EBITDA for the LTM
period ended September 30, 2005 of only 2.1 times and funds from
operations to debt that was an impressive 30% for this same
period. Additionally, the company's accounts receivable have been
increasing at the same rate as the company's sales; for the third
quarter of 2005 sales and accounts receivables increased by
approximately 40%. The increase in accounts receivables was not
offset by other working capital items. Moody's notes that the
company's accounts payables are mainly employee cost related
thereby making it difficult to counterbalance the increase in
accounts receivables by increasing payables.
The company operates in the:
* electric,
* telecom, and
* natural gas segments.
Of these, the electric and telecom business are known to be the
higher margin.
Through focused bidding on higher margin opportunities and a focus
on reducing its accounts receivables, Moody's believes that
InfraSource may be able to reverse the effects of large accounts
receivable on its free cash flow. This, combined with low
leverage for the rating category, led Moody's to affirm
InfraSource's current ratings.
The company's ratings remained constrained by low free cash flow
for the ratings category, for the LTM period ended September 30,
2005 the company's free cash flow to debt was approximately -36%.
The company also relies on Surety Bonding for portions of its
business.
The negative ratings outlook reflects the belief that the
company's free cash flow may not improve sufficiently over the
short term so as to allow the company to be comfortably positioned
within its current rating category. The ratings may decline if
free cash flow to total debt was to remain under 12% on a
projected basis, or if its liquidity was to weaken meaningfully.
The company's free cash flow is limited by the company's large
capital expenditures. Hence, were the returns on these
investments to be below expectations, the ratings may come under
pressure.
The negative outlook considers the company's success in addressing
various challenges that arose earlier in 2005 when the company
lost money on a project that was underbid relative to the costs of
providing the service, its growth rate has been very strong and
that additional challenges may surface. InfraSource's ratings may
improve if its anticipated free cash flow to total debt increased
to over 15% on a sustainable basis. A significant improvement in
free cash flow to total debt could result in a change in outlook.
The company currently has over $50 million in liquidity comprised
of cash and revolver availability.
Formed in 1999 and headquartered in Media, Pennsylvania,
InfraSource Services, Inc. is among the largest independent
providers of infrastructure outsourcing services to the electric
and gas utilities in the U.S. For the year ended December 31,
2004 InfraSource generated sales and EBITDA of $651 million and
$62 million, respectively.
INTERACTIVE MOTORSPORTS: Sept. 30 Equity Deficit Tops $1.9 Million
------------------------------------------------------------------
Interactive Motorsports and Entertainment Corp. delivered its
quarterly report on Form 10-Q for the quarter ending Sept. 30,
2005, to the Securities and Exchange Commission on Nov. 16, 2005.
Performance for the three months ending Sept. 30, 2005 resulted in
a loss of $291,176 on revenue of approximately $966,000 as
compared to the profit of $7,855 on sales of approximately
$1,609,000 for the three-month period ending Sept. 30, 2004.
During the nine months ended Sept. 30, 2005, the company had total
revenues of $3,771,171 compared to $4,702,585 for the nine months
ended Sept. 30, 2004. Sales performance resulted in a net loss of
approximately $719,000 for the 9-month period, an improvement of
almost $361,000 over the loss incurred during the same period in
2004.
A decrease in revenue, for both the quarter and the nine month
period ending Sept. 30, 2005 was expected, and is due primarily to
the company's migration from a business model focusing on
company-owned stores, to one that focuses on revenue sharing
company-owned simulators with store operators, and selling
company-owned simulators to investors or to store operators.
The primary source of funds available to the company are receipts
from customers for simulator and merchandise sales in its two
owned and operated racing centers, percentage of gross revenues
from simulator races and minimum guarantees from revenue share and
lease sites, the sale of simulators, proceeds from equity
offerings including the $2,610,050 received in August 2002,
proceeds from debt offerings including the $700,000 in Secured
Bridge Notes and warrants issued in March 2003, the $604,000 in
net proceeds from Notes and options issued between February and
June, 2004, the additional loan of $300,000 from one of the
existing Bridge Loan note holders, loans from shareholders, credit
extended by vendors, and possible future financings.
As of the filing of this Form 10-QSB, the net proceeds of
$1,874,708 from the three sales transactions for the sale of 44
simulators to Race Car Simulation Corp. have been depleted.
The company believes that it has generated a significant interest
in its simulators, and that some combination of revenue share
agreements, lease agreements and simulator sales agreements with
both the original simulator and the new SMS Reactor simulator will
be sufficient to fund the daily operations of the business,
although there can be no assurances.
Asset Purchase Agreements
On Dec. 31, 2004, March 31, 2005 and April 15, 2005, the company
entered into three Asset Purchase Agreements pursuant to which it
sold forty-four of its race car simulators that were located in
existing revenue share locations, or have been installed in new
revenue share sites. While this transaction generated an
aggregate purchase price of $2,856,600, it also depleted monthly
revenue share payments to the company generated by the simulators
that were sold. Management intends to contract with revenue share
partners and install simulators within its inventory to replenish
the cash flow lost from 34 of the 44 simulators that were sold in
a timely manner, although there can be no assurances. To this
end, the Company has installed a five-simulator site in
Burlington, Vermont, a five-simulator site in Mentor, Ohio, a
two-simulator site in Sheffield, Ohio, and has delivered a
two-simulator trailer to a lessee.
The company's current debt financing includes the extension of
$350,000, plus the addition of $300,000 of the Secured Bridge
Notes and Warrants initiated in March of 2003 until Dec. 31, 2005,
and an extension of a Note and Option Agreement of $146,000 until
Dec. 31, 2005.
As of Sept. 30, 2005, the company had cash and cash equivalents
totaling $87,408 compared to $1,334,673 at Dec. 31, 2004. Current
assets totaled $1,071,681 at Sept. 30, 2005 compared to $2,058,820
on Dec. 31, 2004. Current liabilities totaled $3,897,310 on
Sept. 30, 2005 compared with $4,618,647 on Dec. 31, 2004. As
such, these amounts represent an overall decrease in working
capital of $265,802 for the nine months ending Sept. 30, 2005.
Headquartered in Indianapolis, Indiana, Interactive Motorsports
and Entertainment Corp., through its wholly owned subsidiary,
Perfect Line, Inc., is a world leader in race simulation that owns
and operates racing centers, leases or revenue shares with third
party operators and sells race car simulators. NASCAR Silicon
Motor Speedway customers experience driving in a NASCAR racecar
that simulates the motion, sights and sounds of an actual NASCAR
event. Located in high profile, high traffic locations, the
company's racing centers range from 2 to 12 race car simulators
per location and many sites offer what the Company believes to be
the best selling NASCAR driver merchandise available to the
market.
As of Sept.30, 2005, Interactive Motorsports' equity deficit
widened to $1,968,050 from a $1,741,431 deficit at Dec. 31, 2004.
INTERLIANT: Panel Wants Another Delay in Entry of Final Decree
--------------------------------------------------------------
The Post Effective Date Creditors' Committee of I Succesor Corp.,
fka Interliant Inc., and its debtor-affiliates, pursuant to the
Debtors' Third Amended Plan of Liquidation, asks the U.S.
Bankruptcy Court for the Southern District of New York to delay
the entry of a final decree formally closing the bankruptcy cases
to February 17, 2005.
The Committee tells the Court that while the claims administration
process is substantially complete, and all preference actions have
been settled or dismissed, the Committee's litigation against
certain former insiders continues.
Additionally, settlement discussions are underway in the insider
litigation. Thus, a further extension of the Final Decree
deadlines was required.
Adam H. Friedman, Esq., at Olshan Grundman Frome Rosenzweig &
Wolosky LLP, in New York, represents the Committee.
Headquartered in Purchase, New York, Interliant, Inc., is a
provider of Web site and application hosting, consulting services,
and programming and hardware design to support the information
technologies infrastructure of its customers. The Company and its
debtor-affiliates filed for chapter 11 protection on August 5,
2002 (Bankr. S.D.N.Y. Case No. 02-23150). Cathy Hershcopf, Esq.,
and James A. Beldner, Esq., at Kronish Lieb Weiner & Hellman, LLP,
represent the Debtors in their restructuring efforts. When the
Company filed for protection from its creditors, it listed
$69,785,979 in assets and $151,121,417 in debts. The Court
confirmed the Debtors' Third Amended Plan of Liquidation on March
12, 2004, allowing the Debtors to emerge from bankruptcy on Sept.
30, 2004.
INTERSTATE BAKERIES: Court Okays Fairfax Property Sale for $3.35MM
------------------------------------------------------------------
The U.S. Bankruptcy Court for the Western District of Missouri
approved the sale of a 1.48-acre parcel of real estate at
8522 Lee Highway in Fairfax, Virginia, owned by Interstate
Bakeries Corporation and its debtor-affiliates.
The Debtors have determined that the property is no longer useful
in their business operations and thus considered surplus real
estate that needs to be disposed of or sold.
The Debtors utilized the services of a joint venture composed of
Hilco Industrial, LLC, and Hilco Real Estate, LLC, in connection
with the sale and marketing of the Fairfax Property.
After exploring several alternatives and significant marketing
efforts by the Debtors and Hilco, the Debtors have decided to
sell the Property to Christos S. Sarantis, an individual residing
in the state of Virginia, for $3,350,000, free and clear of all
liens, claims and encumbrances and subject to higher and better
offers.
Mr. Sarantis has deposited $335,000 in escrow.
To maximize the value realized by their Chapter 11 estates from
the sale of the Property, the Debtors will continue to seek and
solicit bids that are higher or otherwise better than the offer
submitted by Mr. Sarantis.
The Debtors have agreed to provide Bid Protections to Mr.
Sarantis in the form of a termination fee equal to $67,000 or 2%
of the Purchase Price. The Debtors will also pay reasonable and
documented expense reimbursement of up to $25,000 to Mr.
Sarantis.
Headquartered in Kansas City, Missouri, Interstate Bakeries
Corporation is a wholesale baker and distributor of fresh baked
bread and sweet goods, under various national brand names,
including Wonder(R), Hostess(R), Dolly Madison(R), Baker's Inn(R),
Merita(R) and Drake's(R). The Company employs approximately
32,000 in 54 bakeries, more than 1,000 distribution centers and
1,200 thrift stores throughout the U.S.
The Company and seven of its debtor-affiliates filed for chapter
11 protection on September 22, 2004 (Bankr. W.D. Mo. Case No.
04-45814). J. Eric Ivester, Esq., and Samuel S. Ory, Esq., at
Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in
their restructuring efforts. When the Debtors filed for
protection from their creditors, they listed $1,626,425,000 in
total assets and $1,321,713,000 (excluding the $100,000,000 issue
of 6.0% senior subordinated convertible notes due August 15, 2014,
on August 12, 2004) in total debts. (Interstate Bakeries
Bankruptcy News, Issue No. 31; Bankruptcy Creditors' Service,
Inc., 215/945-7000)
INTERSTATE BAKERIES: Court Okays Northwest Area Consolidation
-------------------------------------------------------------
The U.S. Bankruptcy Court for the Western District of Missouri
authorized Interstate Bakeries Corporation and its debtor-
affiliates to take actions as are necessary to consolidate
operations in their Northwest profit center. The Court also
approved the procedures for rejecting contracts and abandoning
property.
J. Eric Ivester, Esq., at Skadden Arps Slate Meagher & Flom LLP,
in Chicago, Illinois, relates that Interstate Bakeries Corporation
and its debtor-affiliates have already sought and obtained Court
authority to consolidate operations in five of their profit
centers in the United States:
-- Florida/Georgia,
-- Mid-Atlantic,
-- Northeast,
-- Northern California, and
-- Southern California.
The Debtors' profit centers are groupings of bakeries, depots,
thrift stores and routes based on geographic proximity.
Mr. Ivester reports that the Debtors have already analyzed their
profit center in the Northwest region of the U.S. and have, as a
result, identified, among other things:
(i) unprofitable products and routes;
(ii) areas of inefficient distribution;
(iii) opportunities to rationalize brands and stock keeping
units; and
(iv) excess capacity in the Northwest Profit Center.
The Debtors determined that to achieve the target levels or
profitability and efficiency, they must:
* close their bakery in Lakewood, Washington;
* close certain depots and thrift stores; and
* use remaining depots to service remapped delivery routes.
The Debtors expect to complete these actions by Dec. 17, 2005, at
which time their bread products will be no longer be sold in the
states of Washington and Oregon. Branded cake products, however,
will continue to be available in those markets.
The consolidation is expected to affect approximately 200 bakery
production workers in the Northwest PC. The Debtors sent out
Worker Adjustment and Retraining Notification notices on Oct. 17,
2005.
Mr. Ivester reports that the preliminary estimate charges to be
incurred in connection with the bakery closing in the Northwest PC
is approximately $15,000,000, including:
-- $1,500,000 of severance charges;
-- $11,500,000 of asset impairment charges; and
-- $2,000,000 in other charges.
The Debtors further estimate that approximately $3,500,000 of the
costs will result in future cash expenditures and $500,000 in
capital expenditures and accrued expenses to effect the
consolidation. Costs associated with the reduction of routes,
depots and thrift stores cannot be estimated at this time, Mr.
Ivester says.
The Debtors believe that the consolidation of the Northwest PC
will result in reduced costs, more efficiencies and an improvement
in their financial performance.
Headquartered in Kansas City, Missouri, Interstate Bakeries
Corporation is a wholesale baker and distributor of fresh baked
bread and sweet goods, under various national brand names,
including Wonder(R), Hostess(R), Dolly Madison(R), Baker's Inn(R),
Merita(R) and Drake's(R). The Company employs approximately
32,000 in 54 bakeries, more than 1,000 distribution centers and
1,200 thrift stores throughout the U.S.
The Company and seven of its debtor-affiliates filed for chapter
11 protection on September 22, 2004 (Bankr. W.D. Mo. Case No.
04-45814). J. Eric Ivester, Esq., and Samuel S. Ory, Esq., at
Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in
their restructuring efforts. When the Debtors filed for
protection from their creditors, they listed $1,626,425,000 in
total assets and $1,321,713,000 (excluding the $100,000,000 issue
of 6.0% senior subordinated convertible notes due August 15, 2014,
on August 12, 2004) in total debts. (Interstate Bakeries
Bankruptcy News, Issue No. 32; Bankruptcy Creditors' Service,
Inc., 215/945-7000)
JEROME-DUNCAN: Files First Amended Plan and Disclosure Statement
-----------------------------------------------------------------
Jerome-Duncan, Inc., delivered its First Amended Plan of
Reorganization and an accompanying First Amended Disclosure
Statement to the U.S. Bankruptcy Court for the Eastern District
of Michigan on Nov. 11, 2005.
Summary of Amended Plan
The Plan provides for two alternative methods of implementation.
The first alternative provides for the Debtor and its stockholders
to reorganize the company through a Capital Contribution Agreement
and retain their equity interests in the Reorganized Debtor.
The second alternative consists of a sale of Debtor's assets to be
conducted by the Chief Restructuring Officer in accordance with
terms and conditions of Court-approved sale procedures. The
proceeds from the auction would then be delivered to James H.
Harris, the Debtor's chief restructuring officer, who will act as
a liquidating trustee under to a proposed liquidating trust.
Treatment of Claims and Interests
The Plan contemplates full payment of Ford Motor Company's claims
in full in accordance with any loan documents executed by the
Debtor and Ford or the business terms under which the Debtor and
Ford have operated under the franchise agreement.
The allowed secured claim of Ford Motor Credit Company will be
paid in accordance with the FMCC Loan Documents, provided however,
that any defaults will be waived by FMCC as of the confirmation
date
The allowed claim of the Parkway Agency will be paid in full with
either the proceeds from the capital contribution in accordance
with the Capital Contribution Agreement or the auction of the
Debtor's assets.
Allowed secured claims held by Shashi K. Tejpaul and JD Leasing
will be paid in full with either the proceeds from the capital
contribution in accordance with the Capital Contribution Agreement
or the auction of the Debtor's assets.
The allowed secured claim of SBC Capital Services will be paid a
monthly payment in accordance with the Capital Services
Indebtedness loan documents.
Allowed claims of any insiders, including the claims of Richard
Duncan, Barbara Duncan, Mr. TejPaul and Gail Duncan and all of
their related or affiliated entities will receive either proceeds
from the capital contribution or the auction of the Debtor's
assets.
Interests of the interest holders will either retain their
interests if the capital contribution is made or their claims will
be cancelled if the Debtor instead proceeds with the auction.
Allowed unsecured claims of all unsecured creditors who are not
insiders will be paid in one of two ways. If the Capital
Contribution is made, the Debtor will deposit the Unsecured
Creditor Deposit into the client trust account of the unsecured
creditors committee's counsel. Each unsecured creditor with an
allowed unsecured claim will be paid 100% of its claim without
interest in accordance with the Capital Contribution Agreement.
If the Capital Contribution is not made by the effective date of
the plan, distributions to the all allowed unsecured claims will
come from the proceeds of an auction sale but after full payment
of all allowed administrative, secured and priority claims, in
accordance with the priority scheme of the Bankruptcy Code.
A full-text copy of the first amended Disclosure Statement is
available for a fee at:
http://www.researcharchives.com/bin/download?id=051122022459
Headquartered in Sterling Heights, Michigan, Jerome Duncan Inc.,
is the largest dealer of automobiles manufactured by Ford Motor
Company in the state of Michigan. The Debtor is one of the most
well-known, modern automobile dealers in the area and has a
tradition of serving customers in southeastern Michigan for the
past 50 years. The Debtor employs over 200 individuals in its
operations and generates between $300 and $500 million in annual
sales. The company filed for chapter 11 protection on June 17,
2005 (Bankr. E.D. Case No. 05-59728). Arnold S. Schafer, Esq., at
Schafer and Weiner, PLLC, represents the Debtor in its
restructuring efforts.
LANTIS EYEWEAR: Has Until February 1 to Object to Claims
--------------------------------------------------------
The Honorable Allan L. Gropper of the U.S. Bankruptcy Court for
the Southern District of New York extended, until February 1,
2006, Joseph Myers's period to object to claims filed against the
estate of Lantis Eyewear Corporation, nka Sitnal, Inc.
Mr. Myers, a partner and managing director at Clear Thinking Group
LLC, serves as Creditor Trustee for the Sitnal Creditor Trust
created pursuant to the Debtor's confirmed Second Amended Plan of
Liquidation.
The Bankruptcy Court directs Mr. Myers to seek approval of
adversary proceeding settlements by filing a notice of presentment
of any proposed stipulation and order and serving copies on:
a) the Office of the United States Trustee
Attention: Brian Masumoto, Esq.
33 Whitehall Street, 21st Floor
New York, New York 10004
b) the Master Service List; and
c) all parties having filed notices of appearance in the
Debtor's chapter 11 case on at least ten business days'
notice pursuant to Local Rule 9074-1.
In addition, Judge Gropper allows the Creditor Trustee to settle
adversary proceedings, in which the contested amount does not
exceed $150,000, without further approval by the Court or notice
to any person.
Headquartered in New York, Lantis Eyewear Corporation nka Sitnal,
Inc. -- http://www.lantiseyewear.com/-- is a leading designer,
marketer and distributor of sunglasses, optical frames and related
eyewear accessories throughout the United States. The Company
filed for chapter 11 protection on May 25, 2004 (Bankr. S.D.N.Y.
Case No. 04-13589). Jeffrey M. Sponder, Esq., at Riker, Danzig,
Scherer, Hyland & Perretti LLP, represents the Debtor. When the
Debtor filed for protection from its creditors, it listed
$39,052,000 in total assets and $132,072,000 in total debts.
LEVITZ HOME: Can Continue Postpetition Intercompany Transactions
----------------------------------------------------------------
Levitz Home Furnishings, Inc., and its debtor-affiliates sought
and obtained the U.S. Bankruptcy Court for the Southern District
of New York's permission, on a final basis, to continue
intercompany transactions after the Petition Date.
The Honorable Burton R. Lifland of the Southern District of New
York Bankruptcy Court holds that all Intercompany Claims held by
one Debtor against another Debtor arising from postpetition
intercompany transfers will be entitled to administrative expense
priority pursuant to Section 503(b)(1) of the Bankruptcy Code.
Judge Lifland also directs the Debtors to continue maintaining
current records with respect to all transfers of cash so that all
transactions, including intercompany transactions, may be readily
ascertained, traced, and recorded properly on applicable
intercompany accounts.
Richard H. Engman, Esq., at Jones Day, in New York, notes that
transfers among the Debtors represent extensions of intercompany
credit. The administrative expense status to Intercompany Claims
will ensure that each individual Debtor utilizing funds flowing
through the Cash Management System will continue to bear ultimate
repayment responsibility for its borrowings.
The Debtors maintain current and accurate accounting records of
the intercompany transactions. Thus, each of the Debtor's
entitlement of funds is known and recorded.
Mr. Engman asserts that that the intercompany funding reduces the
administrative costs incurred by the Debtors. By contrast, if
the intercompany funding is to be discontinued, the Debtors' Cash
Management System and related administrative controls will be
disrupted to the detriment of the Debtors and their estates.
Headquartered in Woodbury, New York, Levitz Home Furnishings, Inc.
-- http://www.levitz.com/-- is a leading specialty retailer of
furniture in the United States with 121 locations in major
metropolitan areas principally the Northeast and on the West Coast
of the United States. The Company and its 12 affiliates filed for
chapter 11 protection on Oct. 11, 2005 (Bank. S.D.N.Y. Lead Case
No. 05-45189). David G. Heiman, Esq., and Richard Engman, Esq.,
at Jones Day, represent the Debtors in their restructuring
efforts. When the Debtors filed for protection from their
creditors, they reported $245 million in assets and $456 million
in debts. (Levitz Bankruptcy News, Issue No. 4; Bankruptcy
Creditors' Service, Inc., 215/945-7000)
LEVITZ HOME: Court Okays Continued Use of Existing Business Forms
-----------------------------------------------------------------
In the ordinary course of their business, Levitz Home Furnishings,
Inc., and its debtor-affiliates use a variety of checks and other
business forms. By virtue of the nature and scope of their
business operations and the large number of suppliers of goods and
services with whom they deal on a regular basis, the Debtors
sought and obtained the U.S. Bankruptcy Court for the Southern
District of New York 's permission, on a final basis, to continue
using their existing Business Forms.
The Honorable Burton R. Lifland of the Southern District of New
York Bankruptcy Court, however, directs the Debtors to include the
phrase "Debtor in-Possession" on their checks, as soon as
reasonably practicable.
Judge Lifland also directs Bank of America to honor the Debtors'
prepetition Business Forms with respect to any replacement bank
account that the Debtors may open with the Bank.
Richard H. Engman, Esq., at Jones Day, in New York, notes that
the authority to continue the use of business forms without
alteration has been granted by the Court in other Chapter 11
cases. He asserts that it is important that the Debtors are
permitted use their existing Business Forms, otherwise, the
Debtors' estates will be forced to bear a potentially significant
and unwarranted expense.
Headquartered in Woodbury, New York, Levitz Home Furnishings, Inc.
-- http://www.levitz.com/-- is a leading specialty retailer of
furniture in the United States with 121 locations in major
metropolitan areas principally the Northeast and on the West Coast
of the United States. The Company and its 12 affiliates filed for
chapter 11 protection on Oct. 11, 2005 (Bank. S.D.N.Y. Lead Case
No. 05-45189). David G. Heiman, Esq., and Richard Engman, Esq.,
at Jones Day, represent the Debtors in their restructuring
efforts. When the Debtors filed for protection from their
creditors, they reported $245 million in assets and $456 million
in debts. (Levitz Bankruptcy News, Issue No. 4; Bankruptcy
Creditors' Service, Inc., 215/945-7000)
LEVITZ HOME: Wants to Reject Nine Store Lease Agreements
--------------------------------------------------------
As part of its restructuring strategy, Levitz Home Furnishings,
Inc., has closed and vacated certain store locations, as well as
certain clearance centers, distribution centers, and office
space.
On April 8, 2005, Levitz' Board of Directors approved the plan
to, among other things, close all Seaman and Seaman Kids' stores
and to reopen 23 of those showrooms under the Levitz brand.
Richard H. Engman, Esq., at Jones Day, in New York, relates that
Levitz Home Furnishings, Inc., and its debtor-affiliates also have
begun the process of reviewing certain of their remaining leases,
for both closed and operating locations, to determine whether
continuing to operate from those locations is in their best
interests.
Pursuant to Section 365(a) of the Bankruptcy Code, the Debtors
propose to reject six leases effective on the later of the
Petition Date or the date the Debtors vacate the premises:
Premises Surrender Date
-------- --------------
Levitz Store, Astoria, N.Y. 11/9/2005
Levitz Store, Brooklyn Park, Minn. 11/9/2005
Levitz Store, East Brunswick, N.J. 11/9/2005
Seaman's Store, Jamaica, N.Y. 10/3/2005
Seaman's Store, Nassau, N.Y. 11/9/2005
Messa Call Center, Mesa, Ariz. 11/9/2005
The Debtors lease from Bina Realty Co. the premises for their
Seaman's Store in Brooklyn, New York. The Debtors assigned the
Lease to a third party, Wholesale Clothing Co., Inc., before the
Petition Date. The Debtors seek to reject the Lease and the
Assignment Agreement effective on the Petition Date.
The Debtors also lease from Sam's P.W., Inc., a property in
Roseville, California. The Debtors intended to build a store at
the property, which store remains under construction. The
Debtors never occupied the premises. The Debtors want to reject
the Lease effective on the Petition Date.
While they no longer conduct any business at the Leased
Properties and are generating no revenue from these locations,
rent under the Leases aggregates more than $229,000 per month.
Headquartered in Woodbury, New York, Levitz Home Furnishings, Inc.
-- http://www.levitz.com/-- is a leading specialty retailer of
furniture in the United States with 121 locations in major
metropolitan areas principally the Northeast and on the West Coast
of the United States. The Company and its 12 affiliates filed for
chapter 11 protection on Oct. 11, 2005 (Bank. S.D.N.Y. Lead Case
No. 05-45189). David G. Heiman, Esq., and Richard Engman, Esq.,
at Jones Day, represent the Debtors in their restructuring
efforts. When the Debtors filed for protection from their
creditors, they reported $245 million in assets and $456 million
in debts. (Levitz Bankruptcy News, Issue No. 4; Bankruptcy
Creditors' Service, Inc., 215/945-7000)
LORAL SPACE: Emerges from Chapter 11 with $180 Million in Cash
--------------------------------------------------------------
Loral Space & Communications Inc. officially concluded its
reorganization and has successfully emerged from chapter 11.
"Loral has reached an important milestone with its emergence from
chapter 11," Bernard L. Schwartz, Loral's chairman and chief
executive officer, said. "It is a great triumph for the men and
women of our workforce, who stayed focused on their jobs, upheld
our high manufacturing and service standards and kept Loral in the
forefront of the industry.
"Over the last two-and-a-half years, we have created a stronger,
leaner and more efficient Loral. We have won new awards and
customers, and we continue to seek and capture opportunities in
many new and traditional markets. We are confident that the
momentum we have built will benefit all our constituents."
Throughout the chapter 11 process, Space Systems/Loral remained
the premier manufacturer of commercial satellites, increasing its
market share and winning more than a third of the dollar value of
all contracts awarded over the last 18 months, more than any other
commercial satellite manufacturer. Loral Skynet's fleet is well-
positioned to serve areas with high growth potential such as Asia,
Europe, Latin America, the Middle East and the trans-Atlantic
market. Skynet has also expanded its services beyond traditional
FSS leases with the introduction of new IP-based data services.
Loral's new XTAR joint venture has been awarded contracts for
service to the U.S. State Department and the Spanish Ministry of
Defense.
Loral exits chapter 11 with approximately $180 million in cash.
During the chapter 11 reorganization, Loral did not require any
debtor-in-possession financing, and, as of its emergence from
chapter 11, has only $126 million of debt in the form of the notes
issued by Loral Skynet. Loral Skynet has also issued $200 million
of preferred stock to certain creditors of Loral Orion.
Members of Loral's new board of directors, in addition to chairman
and CEO Bernard L. Schwartz and non-executive vice chairman
Michael B. Targoff, are Sai S. Devabhaktuni, Hal Goldstein, John
D. Harkey Jr., Robert B. Hodes, Dean Olmstead, Mark H. Rachesky
and Arthur L. Simon.
In accordance with the Plan of Reorganization, the company is
issuing 20 million shares of new common stock in Loral Space &
Communications Inc. to certain of its creditors. Loral's prior
common and preferred stock was cancelled as of Nov. 21, 2005, with
no distribution made to holders of such stock.
When shares of the new Loral Space & Communications Inc. common
stock are distributed, they will begin trading on the NASDAQ
market under the ticker "LORL." Loral Space & Communications Inc.
common stock is currently trading as a "when-issued" stock on the
over-the-counter market under the ticker "LRALV."
Business Segments
Satellite Manufacturing - Space Systems/Loral
Space Systems/Loral's backlog at the end of the third quarter was
$902 million, compared with $399 million a year earlier. Since
the beginning of Loral's reorganization in July 2003, Space
Systems/Loral has received orders for nine satellites from seven
separate customers, more than any other manufacturer during the
same time period. Orders came from a wide variety of service
providers: FSS operators, mobile telephony providers, digital
audio radio service and direct-to-home service providers,
including leading operators such as DIRECTV, EchoStar, Intelsat,
PanAmSat and XM Satellite Radio. SS/L has delivered and launched
nine satellites over the last 24 months.
Satellite Services - Loral Skynet
Loral Skynet had a backlog of $502 million at the end of the third
quarter versus $529 million a year earlier. During the last two
years, Loral Skynet shifted its focus from primarily a fixed
satellite services operator to a full-service communications
solutions provider with hybrid space/terrestrial capabilities.
Skynet's fleet of satellites strategically positioned around the
globe in combination with its terrestrial communications resources
can provide customers with one-stop connectivity. In addition,
Skynet shares resources with Loral's XTAR joint venture, allowing
each to cross-market capacity to governments around the world.
Loral Space & Communications -- http://www.loral.com/-- is a
satellite communications company. It owns and operates a fleet of
telecommunications satellites used to broadcast video
entertainment programming, distribute broadband data, and provide
access to Internet services and other value-added communications
services. Loral also is a world-class leader in the design and
manufacture of satellites and satellite systems for commercial and
government applications including direct-to-home television,
broadband communications, wireless telephony, weather monitoring
and air traffic management.
The Company and various affiliates filed for chapter 11 protection
(Bankr. S.D.N.Y. Case No. 03-41710) on July 15, 2003. Stephen
Karotkin, Esq., and Lori R. Fife, Esq., at Weil, Gotshal & Manges
LLP, represent the Debtors in their successful restructuring. As
of Dec. 31, 2004, the Company listed assets totaling approximately
$1.2 billion and liabilities totaling approximately $2.3 billion.
The Court confirmed the Debtors' chapter 11 Plan on Aug. 1, 2005.
MAFCO WORLDWIDE: S&P Rates Proposed $125-Mil Sr. Sec. Loans at B+
-----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' corporate
credit rating to licorice products manufacturer Mafco Worldwide
Corp.
At the same time, Standard & Poor's assigned its 'B+' bank loan
rating and its '2' recovery rating to the company's proposed
$125 million of senior secured credit facilities, indicating that
lenders can expect substantial recovery of principal in the event
of a payment default. All ratings are based on preliminary
offering statements and are subject to review upon final
documentation.
The outlook is stable.
Standard & Poor's estimates that the Camden, New Jersey-based
company will have about $110 million of total debt outstanding
upon the closing of the transaction.
Proceeds from the new credit facilities will be used primarily to
pay a dividend to its indirect parent company, M & F Worldwide
Corp., which will use the funds as part of the financing for its
pending acquisition of check printing company Clarke American
Corp.
The ratings on Mafco reflect:
* the company's narrow business focus and exposure to the
declining tobacco industry,
* customer and supplier concentration, and
* leveraged financial profile.
Standard & Poor's has also considered the consolidated credit
quality of MFW and expects that MFW management will continue to
seek acquisitions at the parent level; however, Standard & Poor's
assumes that there are adequate restrictions in place that
limit the potential for the incurrence of additional debt at Mafco
under the new bank agreement, at least until Mafco has delevered.
Somewhat mitigating these factors are Mafco's leading market share
within its niche segment and strong EBITDA margins.
MARKWEST ENERGY: S&P Chips Rating on $225MM Sr. Unsec. Debt to B-
-----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B+' corporate
credit rating on midstream energy company MarkWest Energy Partners
L.P. and removed the rating from CreditWatch with negative
implications.
At the same time, Standard & Poor's lowered its rating on
MarkWest's existing $225 million senior unsecured debt to 'B-'
from 'B+', reflecting the company's significant use of its
$500 million secured credit facilities for the acquisition of the
Javelina gas processing and fractionation facility in Corpus
Christi, Texas and the related subordination of unsecured
debtholders.
The outlook is negative. Englewood, Colorado-based MarkWest is a
midstream energy master limited partnership with operations in the
Northeast and Southwest U.S.
"The rating affirmation is premised on MarkWest's ability to
execute its financing plan and restore leverage to below 50% in a
timely manner," said Standard & Poor's credit analyst Plana Lee.
The negative outlook on MarkWest reflects the execution risk of
completing each step of the company's financing plan on a timely
basis.
MIRANT: Court Allows Dismissal of MAEM Inverse Condemnation Case
----------------------------------------------------------------
The State of California established the California Power Exchange
as part of the deregulation of the electric energy industry in
California. The PX operated the market for the trading of
contracts for the future delivery of electricity called "Block
Forward Market" contracts. In that market, the PX identified
matching bids and offers, creating a binding obligation between
each buyer and seller and the PX. The PX was permitted to sell
or liquidate the contracts of a defaulting participant.
Mirant Americas Energy Marketing is one of the participants in
the PX market.
In 2000, Southern California Edison Company and Pacific Gas and
Electric Company entered into Block Forward Market contracts to
purchase electricity for various periods in 2001. Both defaulted
on payment and other obligations to the PX.
Liquidation of BFM Contracts
The PX began efforts to liquidate the BFM Contracts to distribute
the proceeds to the non-defaulting participants, including MAEM.
In February 2001, before the PX could complete that liquidation,
the Governor of California issued executive orders commandeering
the BFM Contracts pursuant to Section 8572 of the California
Government Code, the California Emergency Services Act.
Consequently, the BFM Contracts were transferred from the PX to
the California Department of Water Resources.
Claims Against the State
On March 9, 2001, the PX sought bankruptcy protection under
Chapter 11.
The PX filed a claim before the California Victims Compensation
and Government Claims Board seeking recovery under CESA for the
value of the BFM Contracts commandeered by the Governor.
Thereafter, the Official Committee of Participant Creditors of
the PX was formed. It pursued claims on behalf of the PX and its
bankruptcy estate.
MAEM's Claim
MAEM filed its own claim before the Board because the State of
California asserted that the PX did not have standing to assert
the inverse condemnation claims on behalf of the PX market
participants and certain statutes of limitation were about to
expire.
The Participants' Committee amended its claim for damages before
the Board, clarifying that it filed its Claim on behalf of the PX
and the PX market participants for whom the PX had the right to
liquidate the BFM Contracts.
For the same reasons as MAEM, several other PX participants also
filed claims with the Board.
On June 18, 2001, the Board consolidated all of the claims before
it relating to the BFM Contracts.
In September 2001, the Board's Administrative Law Judge ruled
that the Participants' Committee had the authority to represent
the interests of the PX participants before the Board. But in
March 22, 2002, the Board rejected all claims based on the BFM
Contracts.
Court Actions
On July 20, 2001, the Participants' Committee commenced an action
for inverse condemnation styled as California Power Exchange
Corporation v. State of California, et al., in Sacramento County
Superior Court, J.C.C.P. No. 4203, arising from the California
Governor's taking of the BFM Contracts.
The State retaliated by filing a complaint in Sacramento County
Superior Court against the PX and over 90 PX market participants,
including MAEM.
To protect its interests, MAEM filed a separate complaint against
the State captioned as Mirant Americas Energy Marketing, LP v.
State of California, et al., Sacramento County Superior Court,
J.C.C.P. No. 4203. MAEM alleges that, as a result of the
commandeering of the BFM Contracts, California enriched itself by
purchasing electricity at the defaulted BFM Contract prices
rather than at the higher open market electricity prices the
State would have paid and that, therefore, MAEM sustained
damages.
On December 17, 2003, the Sacramento County Superior Court ruled
that PX was a proper party to pursue, through the PX Action, the
claims and the interests of all PX market participants for whom
the PX could have acquired the BFM Contracts.
In 2004, the State, the PX and numerous other parties entered
into a stipulation, pursuant to which, among others, the parties
agreed that the State would dismiss the State Action and that the
PX could represent the interests of the PX market participants in
the PX Action. It was not necessary for MAEM to sign the
stipulation because the State voluntarily dismissed its action
against MAEM after the commencement of the bankruptcy cases of
Mirant Corporation and its debtor-affiliates.
Prosecution of PX Action
In September 2005, as part of its winding down process, the PX
informed the market participants that it would no longer fund the
PX Action. Pursuant to a settlement between the PX and the
Federal Energy and Regulatory Commission, the market participants
may continue prosecuting the PX Action by electing one of two
options:
(1) pay all costs incurred by counsel for the PX for the
continued litigation; or
(2) direct the PX to assign its rights to one or more market
participants who will continue the litigation at their own
expense for the benefit of all market participants. If a
market participant does not respond, it is deemed not to
have elected either option.
The deadline for MAEM and other market participants to decide how
to proceed with regard to the PX Action is tied to the date of
approval of the PX Settlement by both the FERC and the PX
bankruptcy court, both of which have not yet occurred.
Mirant Corporation and its debtor-affiliates expect that the
deadline to elect whether to pursue the PX Action will be in
early November 2005.
According to Jason D. Schauer, Esq., at White & Case LLP, in
Miami, Florida, the MAEM Action presents little value, if any, to
MAEM. The value of the PX Action, on the other hand, including
the potential recovery and distributions, is unclear.
"Although estimates of a judgment in favor of the PX in the PX
Action range from zero to hundreds of millions of dollars, MAEM's
share of any recovery would be proportionate to its market share
of approximately 4.7%," Mr. Schauer says. "Moreover, the PX
settlement accounts into which recovered funds would be placed
are within [the] FERC's jurisdiction to distribute among market
participants."
Many PX participants believe that, due to political and
regulatory reasons, the FERC will use any funds recovered from
the PX Action for refunds rather than distribute those funds to
market participants, Mr. Schauer relates. Thus, even if the
claims have merit, the recovery by MAEM may be zero.
Pursuing the PX Action would be very costly and require complex
expert testimony, Mr. Schauer says. "The PX has already spent in
excess of one million dollars litigating the PX Action and
related cases. Based on the affirmative defenses asserted by the
State, including the State's assertion that the participants
should not recover anything because of their alleged market price
manipulation, the cost of litigation, including discovery, will
likely exceed one million dollars."
Mr. Schauer informs Judge Lynn that based on discussions with the
PX and other market participants, it appears no market
participant plans to elect option 1 under the PX Settlement.
"[A]t most, only a few market participants, if any at all, will
elect a direct assignment of the right to continue to litigate
the PX Action under option 2."
At the Debtors' request, Judge Lynn authorizes, but does not
require, the Debtors to:
(1) dismiss the MAEM Action; and
(2) decline to elect either option under the PX Settlement
and discontinue any active involvement in the PX Action;
and
(3) execute all necessary related documents.
Headquartered in Atlanta, Georgia, Mirant Corporation --
http://www.mirant.com/-- is a competitive energy company that
produces and sells electricity in North America, the Caribbean,
and the Philippines. Mirant owns or leases more than 18,000
megawatts of electric generating capacity globally. Mirant
Corporation filed for chapter 11 protection on July 14, 2003
(Bankr. N.D. Tex. 03-46590). Thomas E. Lauria, Esq., at White &
Case LLP, represents the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $20,574,000,000 in assets and $11,401,000,000 in debts.
(Mirant Bankruptcy News, Issue No. 81; Bankruptcy Creditors'
Service, Inc., 215/945-7000)
MIRANT CORP: Wants Court Okay on PEPCO Indemnification Settlement
-----------------------------------------------------------------
On June 7, 2000, Potomac Electric Power Corporation and Mirant
Corporation entered into an Asset Purchase and Sale Agreement,
under which Mirant agreed to purchase certain of PEPCO's power
generating facilities and related assets in Maryland, Virginia,
and the District of Columbia.
Under the Agreement, Mirant assumed certain obligations while
PEPCO retained certain liabilities with respect to the Auctioned
Assets.
The Wilson Case
In January 2001, Alexander Wilson amended a claim filed in 1999
in the case styled In re Baltimore City Asbestos Litigation in
the Maryland Circuit Court to add PEPCO as a defendant.
The Circuit Court granted PEPCO's motion for summary judgment in
the Wilson Case and dismissed all claims related to PEPCO on
December 14, 2001.
Consequently, PEPCO asked Mirant to reimburse it for its expenses
relating to the Wilson Case. Mirant refused.
On February 1, 2002, PEPCO filed a complaint in the United States
District Court for the District of Columbia styled Potomac
Electric Power Co. v. Mirant Corp., Case No. 1:02-CV-00178-RMU,
seeking a determination that the costs and expenses it incurred
in connection with the Wilson Case were obligations assumed by
Mirant Corp. under the Agreement.
PEPCO's Claims
PEPCO filed several proofs of claim against the Debtors for
reimbursement and indemnification relating to the Wilson Case and
the Wilson Asbestos Litigation Cost Case:
Amended
Claim No. Claim No. Claim Amt. Debtor Asserted
--------- --------- ---------- ---------------
6496 8234 $688,272 Mirant Corp.
6474 8230 688,272 Potomac River
6475 8229 688,272 Piney Point
6476 8228 688,272 Mirant Peaker
6477 8233 688,272 MIRMA
6478 8231 688,272 MD Ash
6479 8237 688,272 D.C. O&M
6480 8236 688,272 Chalk Point
6481 8232 688,272 MIRMA
6482 8235 688,272 MAEM
In 2004, the Debtors objected to PEPCO's Claim Nos. 190, 191,
6474 to 6484 and 6496, and PEPCO Energy Services, Inc.'s Claim
No. 6490. But PEPCO and PEPCO Energy asserted that Mirant failed
to rebut the prima facie validity of their Claims.
The Debtors subsequently sought to estimate certain of PEPCO's
Claims, including the Indemnification Claims. PEPCO objected to
the Estimation Motion.
At PEPCO's request, the U.S. Bankruptcy Court for the Northern
District of Texas lifted the automatic stay in early 2005 to allow
the Wilson Asbestos Litigation Cost Case to proceed.
After negotiations, the Debtors and PEPCO agreed to settle their
dispute regarding the Indemnification Claims.
The principal terms of the Settlement Agreement are:
a. PEPCO will have an allowed, prepetition general unsecured
claim against Mirant Corp., for $472,500;
b. The Allowed Claim will supersede and amend Claim Nos. 6496
and 8234 filed against Mirant Corp., to the extent the
amount sought in the proofs of claim are related to the
Wilson Case;
c. The Other Mirant Party Claims will be disallowed in their
entirety to the extent that the amount sought in the proofs
of claim are related to the Wilson Case;
d. The Wilson Asbestos Litigation Cost Case will be dismissed,
with prejudice;
e. PEPCO will release the Debtors from any claims arising from
the Wilson Asbestos Litigation Cost Case, except for the
Allowed Claim; and
f. The Debtors will release PEPCO from any claims arising from
the Wilson Asbestos Litigation Cost Case.
The Debtors ask the Court to approve their Settlement Agreement
with PEPCO.
Headquartered in Atlanta, Georgia, Mirant Corporation --
http://www.mirant.com/-- is a competitive energy company that
produces and sells electricity in North America, the Caribbean,
and the Philippines. Mirant owns or leases more than 18,000
megawatts of electric generating capacity globally. Mirant
Corporation filed for chapter 11 protection on July 14, 2003
(Bankr. N.D. Tex. 03-46590). Thomas E. Lauria, Esq., at White &
Case LLP, represents the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $20,574,000,000 in assets and $11,401,000,000 in debts.
(Mirant Bankruptcy News, Issue No. 82; Bankruptcy Creditors'
Service, Inc., 215/945-7000)
MIRANT CORP: MAEM Wants to Sell 25,728 NRG Shares in Open Market
----------------------------------------------------------------
Mirant Corporation and its debtor-affiliates, pursuant to Section
363 of the Bankruptcy Code and Rule 6004 of the Federal Rules of
Bankruptcy Procedure, ask the U.S. Bankruptcy Court for the
Northern District of Texas to permit Mirant Americas Energy
Marketing, LP, to sell certain shares it owns of NRG Energy, Inc.,
free and clear of liens, claims, encumbrances and interests.
NRG is an energy company that owns and operates power generation
facilities and sells energy, capacity and related products in the
United States and internationally.
On May 14, 2003, NRG and certain of its debtor-affiliates,
including NRG Power Marketing Inc. and NRG Northeast Generating
LLC filed a chapter 11 petition in the Bankruptcy Court for the
Southern District of New York. On July 14, 2003, MAEM filed four
proofs of claim against the NRG Debtors. On August 25, 2005,
pursuant to NRG's confirmation plan of reorganization, the
Debtors received 25,728 shares of the common stock of NRG in
connection with the NRG Claims.
NRG is a publicly traded company on the New York Stock Exchange
with common shares trading at approximately $40 per share as of
November 7, 2005.
MAEM wants to sell the Shares on the open market. According to
the Debtors, they have no long-term use for the Shares and the
sales proceeds will benefit the Debtors' estates. The Debtors
contend that consideration to be received is fair and reasonable
because the market will determine the price of the Shares.
Headquartered in Atlanta, Georgia, Mirant Corporation --
http://www.mirant.com/-- is a competitive energy company that
produces and sells electricity in North America, the Caribbean,
and the Philippines. Mirant owns or leases more than 18,000
megawatts of electric generating capacity globally. Mirant
Corporation filed for chapter 11 protection on July 14, 2003
(Bankr. N.D. Tex. 03-46590). Thomas E. Lauria, Esq., at White &
Case LLP, represents the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $20,574,000,000 in assets and $11,401,000,000 in debts.
(Mirant Bankruptcy News, Issue No. 83; Bankruptcy Creditors'
Service, Inc., 215/945-7000)
MOLECULAR DIAGNOSTICS: Sept. 30 Balance Sheet Upside-Down by $10MM
------------------------------------------------------------------
Molecular Diagnostics Inc. reports significant improvement in
operating results for the quarter ended Sept. 30, 2005.
Molecular Diagnostics incurred a loss of $308,000 for the
Sept. 30, 2005, quarter, compared to losses of $1,019,000 for
the June 30, 2005, quarter and a loss of $1,949,000 for the
Sept. 30, 2004, quarter.
Due to significant reductions in general, administration and
interest expenses, the company was able to reduce the operating
loss before preferred stock dividend from $1.717 million for
quarter ended Sept. 30, 2004 and $791,000 for quarter ended
June 30, 2005 to a loss of $78,000 for the Sept. 30, 2005 quarter.
"We are pleased with the improvements we were able to make during
the 30 day period at the end of the third quarter in Molecular's
overall financial condition," Robert McCullough Jr., Molecular's
CFO, stated. "We are carrying that momentum forward in the fourth
quarter and look forward to making substantial additional progress
in reducing the liabilities from trade payables, outstanding
notes, accrued wages and accrued interest.
Through conversion of convertible notes to common stock and the
issuance of equity, Molecular Diagnostics was able to reduce total
liabilities outstanding from $12,652,000 to $10,672,000. The
company has reached settlement agreements with vendors on
approximately $1,405,000.
Going forward, the company plans to significantly reduce the
outstanding liabilities by converting much of the remaining
$3,560,000 notes, and settling or paying off much of the remaining
trade accounts payable of $2,405,000 as of Sept. 30, 2005, and
significantly reducing accrued liabilities of $2,882,000.
Molecular Diagnostics, Inc. -- http://www.molecular-dx.com/--
formerly Ampersand Medical Corporation, is a biomolecular
diagnostics company focused on the design, development and
commercialization of cost-effective screening systems to assist in
the early detection of cancer. MDI has currently curtailed its
operations focused on the design, development and marketing of its
InPath(TM) System and related image analysis systems, and expects
to resume such operations only when additional capital has been
obtained by the Company. The InPath System and related products
are intended to detect cancer and cancer-related diseases, and may
be used in a laboratory, clinic or doctor's office.
As of Sept. 30, 2005, Molecular Diagnostics' balance sheet showed
a $10,080,000 equity deficit, compared to a $12,123,000 deficit at
Dec. 31, 2004.
NETWORK COMMS: S&P Places B- Rating on $175 Million Senior Notes
----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B' corporate
credit and 'B+' bank loan rating and recovery rating of '1' for
Network Communications Inc. The affirmation follows the company's
revised refinancing plan to reduce the size of its bank facility
by $25 million and leave in place existing pay-in-kind holding
company debt.
In addition, Standard & Poor's assigned its 'B-' rating to NCI's
privately placed Rule 144A $175 million senior notes due 2013 and
withdrew the rating on the company's senior subordinated notes,
which are no longer being marketed.
The rating outlook is stable.
Pro forma total debt was $250 million at Sept. 11, 2005.
Lawrenceville, Georgia-based NCI is a leading publisher of
targeted real estate classified advertising magazines.
"The ratings reflect NCI's niche position in the increasingly
competitive and cyclical real estate classified advertising
market, its narrow product portfolio, high financial leverage, and
the risks arising from the migration of its classified real estate
advertising revenues to the Internet," said Standard & Poor's
credit analyst Hal Diamond. "These negative factors are
minimally offset by NCI's established position in magazine-based
real estate classified advertising, recently good operating
performance, and its relatively high conversion of EBITDA to
discretionary cash flow," the analyst continued.
The application of discretionary cash flow to debt reduction
should enable NCI to withstand some increase in competition or a
moderate cyclical deterioration in classified real estate volumes
over the next few years.
The outlook would be revised to negative if a cyclical
deterioration in operating performance and/or adverse shifts in
the company's competitive position result in an increase in debt
leverage. Standard & Poor's would consider revising the outlook
to positive over the longer term if NCI is able to broaden its
business base, improve overall profitability, lower debt leverage,
and establish an appropriate margin of compliance with tightening
covenants.
NETWORK INSTALLATION: Stockholders Equity Soars by $8.6 Million
---------------------------------------------------------------
Network Installation Corp. (OTC Bulletin Board: NWKI), reported
revenue of approximately $1.1 million for the quarter ended Sept.
30, 2005, compared to $760,835 for the quarter ended Sept. 30,
2004, a 41% increase. Network Installation recorded approximately
$1.2 million in non-cash charges for the quarter ended September
30, 2005. Total cash on hand was approximately $1.3 million.
Network Installation CEO Jeffrey Hultman stated, "I am pleased to
announce that for the very first time, we've achieved revenue of
$1 million in sequential quarters. I am even more excited
regarding the tremendous progress we've made with our two most
recent acquisitions of Kelley Technologies and Spectrum
Communications. Mr. Hultman added, "2005 has been a period of
significant transition for Network Installation as we are
continuing to wind down lower margin projects and expensing the
associated costs. While we will continue to concentrate on
considerably greater top line growth in 2006, we will also focus
our efforts on achieving profitability."
Acquisitions
Kelley Technologies was acquired on Sept. 22, 2005 and for
purposes of reporting in Network Installation's 10-QSB filing for
the period ending Sept. 30, 2005, the statement of profit and loss
is reflective of only eight days prior to the quarter end, however
the balance sheet reflects a consolidation of both companies. The
acquisition of Spectrum Communications closed on Nov. 1, 2005
following the end of the quarter and therefore its financial
statements have not been included. Upon the Company's future
filing of its 10-KSB for the period ending Dec. 31, 2005, the
complete financial results of Kelley Technologies and Spectrum
Communications will be consolidated with Network Installation.
Network Installation Corp. --
http://www.networkinstallationcorp.net/-- is a single source
provider of communications infrastructure, specializing in the
design, installation, deployment and integration of specialty
systems and computer networks. Through its wholly-owned
subsidiaries, Kelley Technologies, Spectrum Communications and Com
Services, Network Installation Corp. provides its services to the
following customers and industries; U.S. Dept. of Homeland
Security, Gaming & Casinos, U.S. Government & Military, local and
regional municipalities, Healthcare and Education.
At Sept. 30, 2005, Network Installation's balance sheet showed a
$6,700,753 stockholders' deficit, compared to a $1,877,631 deficit
at Dec. 31, 2004.
NEWS CORP: Moody's Raises Pref. Shares' Rating to Baa3 from Ba1
---------------------------------------------------------------
Moody's Investors Service upgraded the ratings of News Corporation
to Baa2 from Baa3 (senior unsecured). Moody's action reflects
News Corp.'s strengthened credit metrics, together with Moody's
confidence in management's ability and desire to maintain a
stronger credit profile. This rating action concluded the review
for possible upgrade that was initiated on September 22, 2005.
The ratings upgraded include:
News America Incorporated:
* Senior unsecured to Baa2 from Baa3
News Corporation Finance Trust II:
* Senior unsecured to Baa2 from Baa3
News Corporation Exchange Trust:
* Trust preferred shares to Baa3 from Ba1
The outlook for the above ratings is stable.
The rating upgrade reflects News Corp.'s operational success in
growing revenues and cash flow over recent years and Moody's view
that the company can maintain its current stronger credit metrics
while continuing to repurchase shares under its current $3 billion
program, invest in its businesses, and prudently finance
acquisitions.
Further, Moody's believes that News Corp.'s accumulated cash
balance (about $6.5 billion as of September 30, 2005) affords the
company significant flexibility to withstand a downturn in the
economy or partially deal with Liberty Media's stake (about 18%
voting stake; and 16% economic stake, which is worth about $8
billion) in News Corp. if necessary. Moody's considers
management's publicly-stated desire to maintain a higher
investment-grade credit rating when calculating financial
projections, and therefore expects the company would reduce
discretionary spending and leverage in a downturn to defend
against rating pressure.
Moody's removed News Corp.'s ratings from review for upgrade
earlier this year due to concern that Liberty Media's increased
voting stake in the company could pressure News Corp. into a
transaction that could reverse the improving credit trend. The
moves taken by the company's board neutralize the pressure for the
next two years, but a negotiated resolution over the intermediate-
term is possible. Liberty Media is motivated by tax efficiency
which translates into a low probability for a simple cash
repurchase of the stock occurring.
However, an asset trade for the stock could also carry negative
credit implications, and therefore the company would have to
mitigate the effect by reducing indebtedness with cash on hand
and/or allowing itself to gain in credit strength in other manners
within the near-term. Moody's further relies on management's
discretionary commitment to its debt ratings in light of any
looming Liberty Media ownership pressures and believes the poison
pill reduces concern over an imminent transaction and may be
considered a credit-friendly initiative, given the short-term
focus and view on use of higher debt leverage espoused by Liberty
Media. Moody's expects that the company will not consider a
transaction that will resolve the Liberty ownership issue in a
manner that would materially impair its financial flexibility and
its credit profile which is why the review for upgrade was
reinitiated and the rating ultimately raised.
Upward rating movement would reflect further strengthening of the
company's balance sheet, particularly if cash were allocated to
debt reduction, and if debt to EBITDA (adjusted using Moody's
standard adjustments) were to decline and maintained under 2.5x
while also maintaining free cash flow conversion in the 35% to 45%
range. A substantial decline in free cash flow outside the
expected decrease in 2006 which would increase the debt to above
3.5x EBITDA, or a change of commitment from management to stay
within targeted metrics by monitoring discretionary spending,
including acquisitions and stock repurchases, may put downward
pressure on the ratings.
The Baa2 senior unsecured debt rating of News Corp. and its
subsidiaries is based on its position as one of the world's
leading diversified media enterprises. Its diversity helps to
offset the variability in performance of its individual business
units, and the balance of mature strong cash flow generating units
support the early growth stage businesses which are important
components of the company's strategy. The ratings also
acknowledge News Corp.'s strong, relatively liquid, portfolio of
assets comprised of publicly traded companies. Most of the value
includes minority interests in operations that are core businesses
for News Corp., such as BSKYB (37%) and DIRECTV (34%), which
together are worth over $12 billion.
The rating also reflects Moody's expectation for continued prudent
financial management as the media giant seeks to broaden its
presence in both the content and distribution businesses. The
rating reflects moderating acquisition-driven event risk going
forward, as the company pursues smaller Internet company
acquisitions, and focuses on organic growth and strategic
ventures, particularly within the new FIM unit; Moody's expects
this strategic shift to continue in the intermediate term.
The rating also considers News Corp.'s strong free cash flow
generation from its media and entertainment units which provide
the company with exceptional financial flexibility and liquidity.
However, Moody's anticipates some pressure on News Corp.'s free
cash flow in the near-term as the company increases its spending
for planned expansion of its theatrical production film slate, and
over the intermediate term, as Moody's believes that as increasing
profits are generated, the company will use up its NOLs and its
cash tax rate will therefore increase.
News Corp.'s credit metrics are further enhanced when the
company's strong cash balance is considered. The company's total
debt-to-EBITDA was approximately 3.2x, and debt was 6.0x free cash
flow (both metrics adjusted for Moody's standard adjustments) at
September 30, 2005 (last twelve months); net of cash, debt-to-
EBITDA was 1.9x, debt-to-free cash flow was 2.3x, though Moody's
does not anticipate the company using its cash to materially
reduce indebtedness.
Moody's believes the company is positioned to sustain its improved
financial fundamentals throughout an economic cycle based on the
discretionary nature of a large portion of News Corp.'s cash uses
in the intermediate term. Moody's anticipates that progress in
News Corp.'s operating performance will continue, such as with
continued opportunity for revenue increases in the cable networks
and as Sky Italia is expected to turn profitable in 2006 with
almost 4 million subscribers, as a result of reduced churn and
increased ARPU. Moody's expects growth in News Corp.'s operating
profit of over 10% for 2006.
The stable rating outlook reflects News Corp.'s leading franchises
in various global markets, many of which are still expected to
experience growth. Moody's forecast, which includes conservative
estimates for Fox Interactive Media and incorporates an expected
decrease in free cash flow in 2006, supports News Corp.'s ability
to remain within adjusted targeted credit metrics and in line with
Baa2 peers. Moody's expects total debt, which includes its
exchangeable trust preferred securities at face value, guaranteed
debt, to remain around 3.0x EBITDA (adjusted for Moody's standard
adjustments).
Moody's anticipates that the company will generate in excess of
$1.5 billion of free cash flow in 2006 and growing to over
$2 billion per annum over the intermediate-term and expects the
company's adjusted debt to free cash flow to remain strong within
a range of 5.0x to 8.0x, and for the free cash flow conversion to
remain in the 35% to 45% range.
Moody's notes that free cash flow conversion is expected to
decline in 2006 based on the company's aforementioned intention to
expand its film release slate which is expected to be a large use
of cash in 2006. Moody's views this change as credit neutral
since it should be a one-time up-tick in working capital use and
the Film Entertainment segment is expected to grow its profit
contribution as a result.
The News Corporation, with its headquarters in the United States,
is one of the world's largest media companies and has operations
in:
* the production and distribution of motion picture and
television programming;
* television;
* satellite and cable broadcasting;
* the publication of newspapers, magazines, books and
promotional free-standing inserts;
* the development of digital broadcasting, conditional access
and subscription management systems; and
* the creation and distribution of popular on-line
programming.
NORTHWEST AIRLINES: Court Approves ATSA, NAMA & TWU Labor Pacts
---------------------------------------------------------------
Northwest Airlines Corp. and its debtor-affiliates seek the U.S.
Bankruptcy Court for the Southern District of New York's
authorization to enter into new collective bargaining agreements
with the Aircraft Technical Support Association, the Northwest
Airlines Meteorologists Association, and the Transport Workers
Union of America.
The Debtors have negotiated voluntary labor cost reductions with
the negotiating committee of each of the Unions to achieve more
competitive labor costs. The Debtors have proposed reductions in
pay and benefits to the Unions to generate $3,900,000 in annual
savings.
ATSA
Northwest Airlines, Inc., and ATSA, which represents the Debtors'
technical support employees, are parties to a collective
bargaining agreement dated November 2, 1998. The ATSA CBA had
an amendable date of November 1, 2004. It remains in effect
pursuant to the status quo provisions of the Railway Labor Act.
To reduce the Debtors' labor costs by $2,250,000 per year, ATSA
agrees:
* to a base pay reduction of 9.9%;
* that ATSA-represented employees will have a four-week
maximum annual vacation accrual, and the President's Day,
Birthday, and Personal Day holidays will be eliminated;
and
* that sick leave will be paid at 75%, sick bank hours will
be capped at 520 hours, and sick days will be accrued at
five sick days per year.
The ATSA membership has voted to ratify the terms of the ATSA
Agreement. A full-text copy of the ATSA Agreement is available
for free at:
http://bankrupt.com/misc/NWA_ATSA_agreement.pdf
NAMA
Northwest and NAMA, which represents the Debtors' meteorologists,
are parties to a CBA signed on October 29, 1998. The NAMA CBA
was amendable on October 31, 2004. It remains in effect pursuant
to the status quo provisions of the Railway Labor Act.
For the Debtors to achieve a $147,000 reduction in annual labor
costs, NAMA agrees:
* to a base pay reduction of 4.5%;
* that NAMA employees will have a six-week maximum annual
vacation accrual; and
* that sick leave will be paid at 75% if used, sick bank
hours will be capped at 520 hours, and sick days will be
accrued at five sick days per year. Existing sick
accruals will be grandfathered.
The NAMA Agreement is subject to ratification by NAMA members on
or before November 21, 2005. A full-text copy of the NAMA
Agreement is available for free:
http://bankrupt.com/misc/NWA_NAMA_accord.pdf
TWU
Northwest and TWU, which represents the Debtors' dispatchers and
operations planners, are parties to a CBA signed on December 1,
1998. The TWU CBA had an amendable date of November 30, 2003.
It remains in effect pursuant to the status quo provisions of the
Railway Labor Act.
To reduce the Debtors' labor costs by $1,500,000 per year, TWU
agrees:
* to a base pay reduction of 4.0%;
* that TWU employees will have a six-week maximum annual
vacation accrual; and
* that sick leave will be paid at 75% if used, sick bank
hours will be capped at 520 hours, and sick days will be
accrued at five sick days per year. In addition, existing
sick accruals will be grandfathered.
The TWU membership has voted to ratify the terms of the TWU
Agreement. A full text copy of the TWU Agreement is available
free of charge at:
http://bankrupt.com/misc/NWA_TWU_accord.pdf
Additional Provisions
The Agreements will be effective until December 31 of the fourth
full calendar year after the Debtors emerge from bankruptcy.
Under the Agreements, the current defined benefit pension plans
will be frozen and replaced with a defined contribution plan at
5% of wages or a similar plan of equivalent cost to the Debtors,
effective on their emergence from bankruptcy.
Preservation of the frozen defined benefit plans is contingent on
legislation being enacted to reduce pension-funding costs to
acceptable levels. For the legislation to have the effect of
preserving the frozen pension plans, the Debtors must also
realize a competitive cost structure and have the ability to
attract new financing to successfully exit bankruptcy, Gregory M.
Petrick, Esq., at Cadwalader, Wickersham & Taft LLP, notes.
If the concession does not materialize, arrives too late, is
insufficient, or the Debtors suffer adverse economic
circumstances on other fronts, the Debtors may seek to terminate
their pension plans, Mr. Petrick tells the Court.
With respect to medical benefits, the Agreements modify the group
medical and dental plans based on the Debtors' intention to
implement a single Company Group Medical/Dental Plan. This
would, among other things, require greater employee contributions
to the premiums and modify deductibles and insurance coverage
contributions.
The Agreements provide for profit sharing in the form of 10%
payout of all pre-tax income in excess of $1,000,000.
The Agreements also modify retiree health benefits for future and
current retirees.
Mr. Petrick clarifies that the Debtors are neither seeking to
assume their existing CBAs with their Unions nor convert any
prepetition claims into postpetition claims.
* * *
Judge Gropper approves the Debtors' Agreements with their three
unions on an interim basis. The approval will be deemed final
effective November 26, 2005, absent any timely filed objections.
Final approval of the NAMA and TWU Agreements is conditioned upon
the favorable membership ratification vote by the union members.
The Debtors' request to reject CBAs under to Section 1113(c) of
the Bankruptcy Code will be withdrawn, only as it relates to
ATSA, NAMA, and TWU on the effective date of the Agreements.
Northwest Airlines Corporation -- http://www.nwa.com/-- is the
world's fourth largest airline with hubs at Detroit,
Minneapolis/St. Paul, Memphis, Tokyo and Amsterdam, and
approximately 1,400 daily departures. Northwest is a member of
SkyTeam, an airline alliance that offers customers one of the
world's most extensive global networks. Northwest and its travel
partners serve more than 900 cities in excess of 160 countries on
six continents. The Company and 12 affiliates filed for chapter
11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-
17930). Bruce R. Zirinsky, Esq., and Gregory M. Petrick, Esq., at
Cadwalader, Wickersham & Taft LLP in New York, and Mark C.
Ellenberg, Esq., at Cadwalader, Wickersham & Taft LLP in
Washington represent the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $14.4 billion in total assets and $17.9 billion in total
debts. (Northwest Airlines Bankruptcy News, Issue No. 11;
Bankruptcy Creditors' Service, Inc., 215/945-7000)
NORTHWEST AIRLINES: Court Approves ALPA & APFAA Interim Pacts
-------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
approved Northwest Airlines Corp. and its debtor-affiliates'
interim agreements with the Air Line Pilots Association,
International, and the Professional Flight Attendants Association
pursuant to Section 1113(e) of the Bankruptcy Code.
Judge Gropper authorizes the Debtors to implement interim changes
in their collective bargaining agreements with the International
Association of Machinists and Aerospace Workers, effective
November 16, 2005. Specifically, the Debtors may reduce the
wages paid to employees represented by IAM by 19%, and reduce
amounts paid as sick pay to a rate of 75% of the prevailing wage
rate after taking into account the temporary pay reduction.
The Section 1113(e) relief with respect to each of the CBAs will
expire on the earlier of:
(a) the effectiveness of a consensual permanent agreement
between the Debtors and a union;
(b) the rejection of the CBA under Section 1113(c);
(c) the denial of the Debtors' request to reject the CBA under
Section 1113(c);
(d) the date, if any, that the interim relief with PFAA
terminates pursuant to the Letter of Agreement between the
Debtors and PFAA.
Northwest's Statement
On November 16, 2005, Northwest Airlines (OTC: NWACQ:PK) said that
the U.S. Bankruptcy Court for the Southern District of New York
has granted the airline's Section 1113(e) motion that requires
temporary wage and benefit reductions of $114 million on an annual
basis for Northwest employees represented by the International
Association of Machinists and Aerospace Workers.
Northwest had earlier reached interim agreements with the
Air Line Pilots Association and the Professional Flight
Attendants Association. ALPA agreed to temporary pay and other
reductions of $215 million on an annualized basis and PFAA agreed
to cuts of $117 million. The interim pay reductions for the
three unions are effective today.
As previously announced, Northwest has reached agreements on
permanent wage and benefit reductions with employees represented
by the Aircraft Technical Support Association and the Transport
Workers Union of America. The airline also has a tentative
agreement with the Northwest Airlines Meteorology Association.
"With today's court action, we now have interim pay
reductions in place with our three large unions that provide
Northwest Airlines with immediate labor cost savings. We must
now complete our discussions with union leaders on long-term
agreements," said Doug Steenland, president and chief executive
officer.
Mr. Steenland continued, "Another key milestone in our
ongoing restructuring efforts is the permanent wage and benefit
reductions we achieved with the Aircraft Technical Support
Association and the Transport Workers Union of America."
"Those agreements, teamed with a tentative agreement with
the Northwest Airlines Meteorology Association, along with two
rounds of salaried and management pay cuts and the labor cost
savings achieved through Northwest's new aircraft maintenance
program, are essential to the airline's continuing efforts to
achieve a competitive cost structure."
"We sincerely appreciate the financial sacrifices our
employees are making to help ensure that Northwest completes its
restructuring process and emerges as a strong, global
competitor," Mr. Steenland concluded.
Northwest Airlines Corporation -- http://www.nwa.com/-- is the
world's fourth largest airline with hubs at Detroit,
Minneapolis/St. Paul, Memphis, Tokyo and Amsterdam, and
approximately 1,400 daily departures. Northwest is a member of
SkyTeam, an airline alliance that offers customers one of the
world's most extensive global networks. Northwest and its travel
partners serve more than 900 cities in excess of 160 countries on
six continents. The Company and 12 affiliates filed for chapter
11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-
17930). Bruce R. Zirinsky, Esq., and Gregory M. Petrick, Esq., at
Cadwalader, Wickersham & Taft LLP in New York, and Mark C.
Ellenberg, Esq., at Cadwalader, Wickersham & Taft LLP in
Washington represent the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $14.4 billion in total assets and $17.9 billion in total
debts. (Northwest Airlines Bankruptcy News, Issue No. 11;
Bankruptcy Creditors' Service, Inc., 215/945-7000)
NORTHWEST AIRLINES: $10,000,000 Asset Sales Deemed De Minimis
-------------------------------------------------------------
Before the Petition Date, Northwest Airlines Corp. and its debtor-
affiliates routinely sold, or when necessary, disposed of non-core
assets that had become tangential or superfluous to their
operations.
Gregory M. Petrick, Esq., at Cadwalader, Wickersham & Taft LLP,
in New York, tells the Court that as the Debtors' Chapter 11
cases progress, they will be evaluating assets and business
locations to consolidate their operations and focus on more
profitable activities and locations.
Mr. Petrick says that as the Debtors make these operational
decisions, the amount of equipment, fixtures, and other
incidental assets to be disposed of will undoubtedly increase.
Accordingly, the Debtors seek the U.S. Bankruptcy Court for the
Southern District of New York's permission to sell obsolete,
excessive, burdensome, or relatively de minimis assets with a
selling price of no more than $10,000,000.
The Debtors will adopt these Sale Procedures:
(a) The Debtors will serve a notice describing the assets to
be sold, any commissions to be paid to third-parties, and
the purchase price on:
* any known affected creditor asserting a Lien on any De
Minimis Assets subject to the sale;
* the U.S. Trustee; and
* counsels for the Official Committee of Unsecured
Creditors and the Official Committee of Retired
Employees;
(b) No notice is needed for asset sales with a purchase
price equal to or less than $1,000,000, provided,
however, that upon request, the Debtors will furnish a
quarterly schedule of all the assets sold to the U.S.
Trustee.
(c) The Debtors will serve notice for assets sales with a
purchase price between $1,000,000 and $10,000,000. If no
objections are filed within five business days of receipt
of the notice, the Debtors may immediately consummate the
transaction, including making any disclosed payments to
third-party brokers or auctioneers. If an objection that
cannot be resolved, the De Minimis Assets will not be sold
except on further order of the Court.
Pursuant to Section 363(f) of the Bankruptcy Code, the Debtors
propose to sell the De Minimis Assets free and clear of liens,
claims and encumbrances.
Abandonment of De Minimis Assets
In some instances, the costs of the sale and satisfaction of
encumbrances may exceed the likely proceeds of the sales.
The Debtors plan to abandon De Minimis Assets to the extent a
sale cannot be consummated at a value greater than the
liquidation expense.
The Debtors ask the Court to approve the Abandonment Procedures:
(a) The Debtors will serve notice of the abandonment of De
Minimis Assets on:
* any known affected creditor asserting a Lien on any De
Minimis Asset proposed to be abandoned by the Debtors;
* the U.S. Trustee; and
* counsel for the Official Committees;
(b) The Debtors will only serve notice of abandonment on those
known affected creditors asserting a Lien on or interest
with respect to De Minimis Assets that, if sold, would
have gross proceeds not greater than $1,000,000. Upon
request, the Debtors will furnish a quarterly schedule of
all the abandoned assets to the U.S. Trustee; and
(c) The Debtors will inform the Notice Parties of the
abandonment of De Minimis Assets that, if sold, would have
estimated gross proceeds from a sale exceeding $1,000,000
but less than or equal to $10,000,000. If no objection is
filed within five days of receipt of the notice, the
Debtors may immediately proceed with the abandonment. If
an objection cannot be resolved, the De Minimis Asset will
not be abandoned except on further Court order.
Mr. Petrick attests that the threshold values for determining
whether the Debtors' assets qualify for De Minimis abandonment
are reasonable in light of the Debtors' everyday operations.
Northwest Airlines Corporation -- http://www.nwa.com/-- is the
world's fourth largest airline with hubs at Detroit,
Minneapolis/St. Paul, Memphis, Tokyo and Amsterdam, and
approximately 1,400 daily departures. Northwest is a member of
SkyTeam, an airline alliance that offers customers one of the
world's most extensive global networks. Northwest and its travel
partners serve more than 900 cities in excess of 160 countries on
six continents. The Company and 12 affiliates filed for chapter
11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-
17930). Bruce R. Zirinsky, Esq., and Gregory M. Petrick, Esq., at
Cadwalader, Wickersham & Taft LLP in New York, and Mark C.
Ellenberg, Esq., at Cadwalader, Wickersham & Taft LLP in
Washington represent the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $14.4 billion in total assets and $17.9 billion in total
debts. (Northwest Airlines Bankruptcy News, Issue No. 11;
Bankruptcy Creditors' Service, Inc., 215/945-7000)
OMEGA HEALTHCARE: Closes Public Offering of 5,175,000 Common Stock
------------------------------------------------------------------
Omega Healthcare Investors, Inc. (NYSE:OHI) closed the
underwritten public offering of 5,175,000 shares of Omega common
stock at $11.80 per share, less underwriting discounts. Nov. 21.
2005's sale included 675,000 shares sold in connection with the
exercise of an over-allotment option granted to the underwriters.
Omega received approximately $58 million in net proceeds from the
sale of the shares, after deducting underwriting discounts and
before estimated offering expenses. Omega intends to use the net
proceeds of the offering of the shares to repay indebtedness under
its senior revolving credit facility. If and to the extent that
there are net proceeds remaining after Omega has repaid all
indebtedness under its senior revolving credit facility, Omega
intends to use these proceeds for working capital and general
corporate purposes.
UBS Investment Bank acted as sole book-running manager for the
offering. Banc of America Securities LLC, Deutsche Bank
Securities and Legg Mason Wood Walker, Incorporated acted as co-
managers for the offering.
Headquartered in Timonium, Maryland, Omega HealthCare Investors,
Inc. -- http://www.omegahealthcare.com/-- is a real estate
investment trust investing in and providing financing to the long-
term care industry. At Sept. 30, 2005, the company owned or held
mortgages on 216 skilled nursing and assisted living facilities
with approximately 22,407 beds located in 28 states and operated
by 38 third-party healthcare operating companies.
* * *
Omega Healthcare's 6.95% notes due 2007 and 7% notes due 2014
carry Moody's Investors Service's B1 rating, Standard & Poor's BB-
rating and Fitch's BB- rating.
O'SULLIVAN IND: Wants Lease Decision Period Stretched to Apr. 12
----------------------------------------------------------------
Pursuant to Section 365 of the Bankruptcy Code, the Debtors have
60 days after the Petition Date to decide whether to assume or
reject their unexpired nonresidential real property leases.
However, the Court can extend the time within which the Debtors
must assume or reject leases for cause.
James C. Cifelli, Esq., at Lamberth, Cifelli, Stokes & Stout,
P.A., in Atlanta, Georgia, tells Judge Mullins that the Debtors
are still in the process of analyzing the necessity of their
leases in connection with their development of a long-term
business plan and anticipate assuming or rejecting the Leases
pursuant to the Plan. Mr. Cifelli explains that the Debtors'
large and complex cases required them to expend a tremendous
amount of energy stabilizing their business and addressing various
operational concerns at these initial stages. As a result, the
Debtors have not yet completed a review of the
Leases.
Accordingly, the Debtors ask the Court to extend their lease
decision period until April 12, 2006.
An extension is unlikely to result in any prejudice to the
relevant lessors, Mr. Cifelli argues. "The Debtors are satisfying
their postpetition obligations under the Leases and do not have
significant outstanding prepetition balances, if any, on account
of such Leases," he says. "In addition, the Debtors have obtained
postpetition financing in these cases, providing them sufficient
liquidity to continue to make payments in accordance with the
terms of the Leases."
Mr. Cifelli notes that if the 60-day period were not extended, the
Debtors would be obligated either to expend significant time and
resources at the early stage of the proceedings to determine
whether it makes long-term business sense to assume the Leases and
the burdens associated or to automatically reject the Leases and
lose potentially valuable assets of their estates.
Headquartered in Roswell, Georgia, O'Sullivan Industries Holdings,
Inc. -- http://www.osullivan.com/-- designs, manufactures, and
distributes ready-to-assemble furniture and related products,
including desks, computer work centers, bookcases, filing
cabinets, home entertainment centers, commercial furniture, garage
storage units, television, audio, and night stands, dressers, and
bedroom pieces. O'Sullivan sells its products primarily to large
retailers including OfficeMax, Lowe's, Wal-Mart, Staples, and
Office Depot. The Company and its subsidiaries filed for chapter
11 protection on October 14, 2005 (Bankr. N.D. Ga. Case No. 05-
83049). On September 30, 2005, the Debtor listed $161,335,000 in
assets and $254,178,000 in debts. (O'Sullivan Bankruptcy News,
Issue No. 6; Bankruptcy Creditors' Service, Inc., 215/945-7000)
O'SULLIVAN INDUSTRIES: Bankruptcy Cues Moody's to Withdraw Ratings
------------------------------------------------------------------
Moody's Investors Service has withdrawn the ratings of O'Sullivan
Industries, Inc., and its parent, O'Sullivan Industries Holding,
Inc., because O'Sullivan Holdings and O'Sullivan Industries have
entered bankruptcy. As of March 31, 2005, O'Sullivan Industries
had approximately $196 million of rated debt on its balance sheet
and O'Sullivan Holdings had approximately $225 million of rated
debt on its balance sheet. Please refer to Moody's Withdrawal
Policy on http://www.Moodys.com/
The following ratings are withdrawn:
For O'Sullivan Industries, Inc.:
-- Corporate family rating
-- $100 million 10.63% Senior secured notes
-- $100 million 13.375% Senior subordinated notes
For O'Sullivan Industries Holding, Inc:
-- $25 million Senior notes
Headquartered in Roswell, Georgia, O'Sullivan Industries Holdings,
Inc. -- http://www.osullivan.com/-- designs, manufactures, and
distributes ready-to-assemble furniture and related products,
including desks, computer work centers, bookcases, filing
cabinets, home entertainment centers, commercial furniture, garage
storage units, television, audio, and night stands, dressers, and
bedroom pieces. O'Sullivan sells its products primarily to large
retailers including OfficeMax, Lowe's, Wal-Mart, Staples, and
Office Depot. The Company and its subsidiaries filed for chapter
11 protection on October 14, 2005 (Bankr. N.D. Ga. Case No.
05-83049). On September 30, 2005, the Debtor listed $161,335,000
in assets and $254,178,000 in debts. (O'Sullivan Bankruptcy News,
Issue No. 6; Bankruptcy Creditors' Service, Inc., 215/945-7000)
OWENS CORNING: Asks Court to Allow Loans with Chinese Subsidiaries
------------------------------------------------------------------
Owens Corning and its debtor-affiliates ask the U.S. Bankruptcy
Court for the District of Delaware to allow non-debtor Owens
Corning subsidiaries in China to make inter-company loans
aggregating $8,000,000 to Owens-Corning (Guangzhou) Fiberglass
Co., Ltd., so it can satisfy its obligations to China Lenders
under a Payoff Letter.
J. Kate Stickles, Esq., at Saul Ewing LLP, in Wilmington,
Delaware, relates that the funds will come from these China
Subsidiaries:
* Owens Corning (China) Investment Co. Ltd,
* Owens-Corning (Shanghai) Fiberglass Co., Ltd.,
* Owens-Corning (Nanjing) Foamular Board Co., Ltd.,
* Owens-Corning (Anshan) Co., Ltd.
Debt Structure
Pursuant to a Loan Facility Agreement, dated March 12, 1998, the
China Lenders made available to OC Investment, OC Shanghai and OC
Guangzhou a revolving credit facility. The China Lenders are:
(i) Standard Chartered Bank,
(ii) KBC Bank N.V., Shanghai Branch, and
(iii) Societe Generale, Hong Kong Branch.
Owens Corning was a guarantor with respect to the Loan Agreement.
On the Petition Date, $15,000,000 and $7,000,000 were outstanding
under the Loan Agreement as it pertains to OC Guangzhou and OC
Shanghai.
Under the terms of the Loan Agreement, each borrower's liability
is several and is limited to its share of the loan proceeds.
Owens Corning, as guarantor, was jointly and severally liable for
all amounts borrowed under the Loan Agreement.
The Standstill and Amendment Agreement
By the Petition Date, both OC Guangzhou and OC Shanghai were
suffering from low industry demand, lower worldwide prices than
had been anticipated, and a proliferation of competition. As a
result, OC Guangzhou and OC Shanghai were unable to service their
obligations under the Loan Agreement, and they had to restructure
their financial obligations to prevent them from being forced
into liquidation proceedings in China.
Accordingly, after the Petition Date, Owens Corning, OC Guangzhou
and OC Shanghai engaged in negotiations with the China Lenders to
restructure their obligations under the Loan Agreement, resolve
certain set-off rights asserted by Standard Chartered and restore
OC Guangzhou and OC Shanghai's financial and operational
viability.
As a result of these negotiations, Owens Corning, OC Guangzhou,
OC Shanghai, and the China Lenders entered into a Standstill and
Amendment Agreement dated as of November 25, 2002. Among other
things, the China Standstill:
(a) extended the maturity date of the Loan Agreement from
March 12, 2003, to December 31, 2005;
(b) permitted the China Lenders an allowed, general unsecured
claim against Owens Corning for $22,000,000;
(c) reduced permanently the principal balance outstanding
under the Loan Agreement based on the [$4,400,000] Sale
Price for the Guarantee Claim on a dollar for dollar
basis, pro rata between OC Guangzhou and OC Shanghai,
based on the principal amounts then outstanding; and
(d) released Owens Corning from its guarantee.
The Court approved the China Standstill in December 2002. As a
result of the China Standstill, OC Guangzhou currently has a
$12,000,000 principal balance outstanding under the Loan
Agreement, exclusive of interest and other obligations. OC
Shanghai's principal balance under the Loan Agreement is
$5,600,000 outstanding, exclusive of interest and other
obligations.
Pay-off of Loan Agreement
Owens Corning, OC Shanghai, OC Guangzhou, and the China Lenders
engaged in discussions regarding the obligations due under the
Loan Agreement. Subsequently, the parties have negotiated a
pay-off letter, which provides that:
1. OC Shanghai will satisfy its obligations under the Loan
Agreement by paying the China Lenders the full amount due;
2. OC Guangzhou will satisfy its obligations under the Loan
Agreement by paying the China Lenders 60% of the amount
due; and
3. Upon Standard Chartered's receipt of the payments, all
indebtedness and obligations of OC Shanghai and OC
Guangzhou with respect to the Loan Agreement and all other
Loan Documents, including all obligations in excess of the
Pay-off Amount, will be deemed discharged in full, and OC
Shanghai and OC Guangzhou will have no further obligations
owing to the China Lenders.
OC Guangzhou is Important to Owens Corning
Ms. Stickles says that although OC Shanghai has sufficient funds
to comply with its obligations under the Pay-off Letter, OC
Guangzhou does not have the same capability. As a result, OC
Guangzhou needs to obtain the necessary funds via loans from the
China Subsidiaries and other Owens Corning subsidiaries.
Ms. Stickles tells Judge Fitzgerald that the loans will allow OC
Guangzhou to continue operating, being "strategically important"
to Owens Corning's long-term business strategy in China. The
intercompany loans will help avoid any potential insolvency
proceedings and the risk that OC Guangzhou could be acquired by a
competitor of Owens Corning.
OC Guangzhou, with its state-of-the-art facility, provides
valuable production support to Owens Corning's global insulation
business and improves the company's ability to meet the demand
for insulation both in China and abroad, Ms. Stickles states.
Furthermore, Guangzhou is situated in a strategic location for
cost-effective service to the Asia Pacific region, including Hong
Kong, Macau, India and South China. OC Guangzhou's facility is
located in the coast of South China, which is one of the most
developed areas in China and where demand for fiberglass has been
increasing annually.
In 2004, OC Guangzhou completed an expansion and upgrade of its
facility, which doubled its capacity. Even with this expansion,
OC Guangzhou's facility is running at close to full capacity. OC
Guangzhou has the capability to produce a range and quality of
fiberglass products that other China facilities cannot produce.
Headquartered in Toledo, Ohio, Owens Corning --
http://www.owenscorning.com/-- manufactures fiberglass
insulation, roofing materials, vinyl windows and siding, patio
doors, rain gutters and downspouts. The Company filed for chapter
11 protection on October 5, 2000 (Bankr. Del. Case. No. 00-03837).
Mark S. Chehi, Esq., at Skadden, Arps, Slate, Meagher & Flom,
represents the Debtors in their restructuring efforts. At Sept.
30, 2004, the Company's balance sheet shows $7.5 billion in assets
and a $4.2 billion stockholders' deficit. The company reported
$132 million of net income in the nine-month period ending
Sept. 30, 2004. (Owens Corning Bankruptcy News, Issue No.
120; Bankruptcy Creditors' Service, Inc., 215/945-7000)
OWENS CORNING: Court Allows Exterior Unit to Buy Assets for $14MM
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware approves an
Asset Purchase Agreement and certain related agreements and
transactions entered into by Exterior Systems, Inc., an Owens
Corning debtor-affiliate, as buyer, on August 17, 2005.
According to Norman L. Pernick, Esq., at Saul Ewing LLP, in
Wilmington, Delaware, Exterior Systems is seeking strategic
opportunities to expand the geographic reach of its business.
Due to the potential adverse impact of certain information
contained in the Motion on the value of the Assets, Exterior
seeks the Court's permission to file the unredacted version of
the Motion under seal.
A full-text copy of the redacted Asset Purchase Agreement and
related Agreements and Transactions are available at no cost at:
http://bankrupt.com/misc/AssetPurchaseAgreement.pdf
The Debtors want to keep the Seller's identity a secret as of
this time because it might cause significant unrest among the
Seller's workforce, with potential loss of key personnel and
other disruption to the Seller's business operations. "The
Seller's 50 employees (other than the Shareholders) are not aware
either that the Assets may be sold or that the proposed purchaser
is a debtor-in-possession."
The Seller conducts its Business at its 114,000 square-foot
leased facility.
Asset Purchase Agreement
As reported in the Troubled Company Reporter on Sept. 13, 2005,
the Purchase Price is $14,855,000, subject to certain
adjustments. Exterior will assume certain trade accounts
payable, contractual liabilities, and liabilities under any
permits or licenses assigned to it. Exterior is required to pay
a $50,000 deposit.
The Assets include:
(a) machinery, equipment, vehicles, tools, supplies, spare
parts, furniture, fixtures and other personal property;
(b) inventories of raw material, work-in-process and finished
goods;
(c) personal property leases;
(d) trade rights, inventions, know-how, trade secrets and
royalty rights;
(e) contracts, purchase orders and sales order;
(f) computer programs and software;
(g) sales literature, catalogs and similar materials;
(h) records and files;
(i) notes, drafts and accounts receivable;
(j) licenses, permits and approvals;
(k) to the extent assignable, rights to workers' compensation
policies;
(l) the Seller's corporate name;
(m) general intangibles; and
(n) goodwill of the Seller.
Exterior is further required to pay:
-- to the Seller a royalty of 2% of all net sales of new
products for a five-year period from the Closing Date; and
-- up to $30,000 in consulting fees and costs necessary to
bring the Seller into compliance with applicable
environmental reporting and record keeping requirements.
Related Agreements and Transactions
A. Consulting Agreement
Exterior will engage one of the Seller's Shareholders, as an
independent contractor for a period of three years to render
consulting services to Exterior in connection with its
operation of the Business.
The Consultant will be paid $45,000 per year and certain other
expenses.
Exterior will be the sole and exclusive owner of all patent,
copyright, trademark, trade secret and other intellectual
property rights in all inventions that the Consultant develops
or assists in developing through the use of Exterior's
confidential information or in the course of rendering
consulting services to Exterior.
B. Transition Services Agreement
Exterior will engage one of the Shareholders, as an
independent contractor for a period of one year to render
transition services to Exterior as it, from time to time, may
reasonably request in connection with Exterior's transition
into its operation of the Business.
Exterior will pay the Shareholder $10,000 as annual fee.
C. Lease Agreement
The Seller will lease its Facility to Exterior for an initial
term of three years.
The annual rent during the initial term is $408,000, payable
in monthly installments of $34,000, with the annual rent to be
adjusted every year at the beginning of the second and third
years based on a Consumer Price Index.
The Lease Agreement also contains provisions relating to
hazardous substances, remediation and indemnification for
claims relating to hazardous substances.
D. Promissory Note
Exterior will issue a Promissory Note, amounting to
$2,505,000, not to be secured by any lien or collateral. The
principal amount together with interest at the rate of 5% per
annum will be paid to the Seller in 18 months from the date of
the Promissory Note.
Headquartered in Toledo, Ohio, Owens Corning --
http://www.owenscorning.com/-- manufactures fiberglass
insulation, roofing materials, vinyl windows and siding, patio
doors, rain gutters and downspouts. The Company filed for chapter
11 protection on October 5, 2000 (Bankr. Del. Case. No. 00-03837).
Mark S. Chehi, Esq., at Skadden, Arps, Slate, Meagher & Flom,
represents the Debtors in their restructuring efforts. At Sept.
30, 2004, the Company's balance sheet shows $7.5 billion in assets
and a $4.2 billion stockholders' deficit. The company reported
$132 million of net income in the nine-month period ending
Sept. 30, 2004. (Owens Corning Bankruptcy News, Issue No.
117; Bankruptcy Creditors' Service, Inc., 215/945-7000)
OWENS CORNING: Gets Court Approval on Aircraft Sale Procedures
--------------------------------------------------------------
Judge Fitzgerald of the U.S. Bankruptcy Court for the District of
Delaware rules that in connection with any particular aircraft
sale, Owens Corning is authorized to enter into a legally binding
purchase and sale agreement with a purchaser and as applicable,
with Pitney Bowes Credit Corporation, Hitachi Capital America
Corporation, and any Owner Trustee with respect to the particular
aircraft being sold that contains customary representations,
warranties and other terms and conditions. Upon the closing of a
particular aircraft sale of:
(i) the Hawker 2426 and the Hawker 2428 aircraft, the
purchaser will pay the gross proceeds to PBCC or
Hitachi, as applicable;
(ii) the Falcon aircraft, the purchaser will pay the gross
proceeds to the party designated in writing by PBCC and
the Owner Trustee;
(iii) the Hawker 2426 and the Hawker 2428 aircraft, PBCC or
Hitachi, as applicable, will transfer their interest in
the aircraft to the purchaser pursuant to the aircraft
agreement free and clear of any interest of PBCC and
Hitachi and the Debtors, and pursuant to Section 363 of
the Bankruptcy Code, free and clear of any liens, claims
and encumbrances held by any entity; and
(iv) the Falcon aircraft, PBCC will transfer its interest in
the Falcon and cause the Owner Trustee to transfer its
interest in the Falcon, free and clear of any interest
of PBCC, the Owner Trustee and the Debtors and pursuant
to Section 363 of the Bankruptcy Code the sale will be
free and clear of any liens, claims and encumbrances of
any entity with respect to the Falcon.
Headquartered in Toledo, Ohio, Owens Corning --
http://www.owenscorning.com/-- manufactures fiberglass
insulation, roofing materials, vinyl windows and siding, patio
doors, rain gutters and downspouts. The Company filed for chapter
11 protection on October 5, 2000 (Bankr. Del. Case. No. 00-03837).
Mark S. Chehi, Esq., at Skadden, Arps, Slate, Meagher & Flom,
represents the Debtors in their restructuring efforts. At Sept.
30, 2004, the Company's balance sheet shows $7.5 billion in assets
and a $4.2 billion stockholders' deficit. The company reported
$132 million of net income in the nine-month period ending
Sept. 30, 2004. (Owens Corning Bankruptcy News, Issue No.
119; Bankruptcy Creditors' Service, Inc., 215/945-7000)
PACIFIC BAY: Fitch Affirms BB- Rating on $17-Mil Preference Shares
------------------------------------------------------------------
Fitch Ratings upgrades one class and affirms four classes of rated
notes issued by Pacific Bay CDO, Limited. These rating actions
are effective immediately:
-- $315,000,000 class A-1 first priority senior secured
floating-rate notes affirmed at 'AAA';
-- $64,000,000 class A-2 second priority senior secured
floating-rate notes affirmed at 'AAA';
-- $36,000,000 class B third priority senior secured
floating-rate notes affirmed at 'AA';
-- $17,000,000 preference shares affirmed at 'BB-';
-- $8,762,099 class C mezzanine secured floating-rate notes
upgraded to 'A-' from 'BBB'.
Pacific Bay is a collateralized debt obligation, which closed in
November 2003. The portfolio consists of 70.5% residential
mortgage-backed securities, 8.9% commercial mortgage-backed
securities, 11.6% asset-backed securities, 6.6% corporate
securities, and 1.3% CDOs.
Fitch reviewed the credit quality of the individual assets
comprising the portfolio and discussed the transaction's
performance with Pacific Investment Management Company LLC, the
collateral manager.
According to the trustee report dated Oct. 31, 2005, the
overcollateralization tests, interest coverage tests, Fitch
weighted average rating factor test, and other performance tests
continue to pass their required levels. Additionally, the
portfolio contains no defaulted securities. As a result of this
analysis Fitch believes that the credit enhancement along with the
coverage tests have remained at appropriate levels to maintain the
ratings for each of the classes A-1, A-2, B, and the preference
share notes.
Due to an equity cap which caps interest distributions to the
preference shares at 14% per annum and amortizes the class C notes
with the excess spread, the class C notes have paid down by 48.5%
since the closing of the deal two years ago. This de-leveraging
of the class C notes has increased the credit enhancement
available to the class C notes to 6.5% from 3.8% at closing.
Fitch believes that the credit protection to the class C notes has
improved enough to warrant an upgrade to those notes. The ratings
of the class A-1, A-2, and B notes address the likelihood that
investors will receive full and timely payments of interest, as
per the governing documents, as well as the stated balance of
principal by the legal final maturity date. The rating of the
class C notes addresses the likelihood that investors will receive
ultimate and compensating interest payments, as per the governing
documents, as well as the stated balance of principal by the legal
final maturity date.
The rating of the preference shares addresses the ultimate payment
of a 2% yield per annum on the preference share rated balance as
well as the preference share rated balance by the legal final
maturity date.
Fitch will continue to monitor and review this transaction for
future rating adjustments. Additional deal information and
historical data are available on the Fitch Ratings Web site at
http://www.fitchratings.com/ For more information on the Fitch
VECTOR Model, see 'Global Rating Criteria for Collateralised Debt
Obligations,' dated Sept. 13, 2004, available on the Fitch Ratings
Web site at http://www.fitchratings.com/
PEMMA CORPORATION: Case Summary & 26 Largest Unsecured Creditors
----------------------------------------------------------------
Lead Debtor: The Pemma Corporation
dba California Transmission Products
515 South Santa Fe
Santa Ana, California 92705
Bankruptcy Case No.: 05-50043
Debtor affiliates filing separate chapter 11 petitions:
Entity Case No.
------ --------
HMS Holding Co. 05-50044
Chapter 11 Petition Date: November 21, 2005
Court: Central District Of California (Santa Ana)
Judge: John E. Ryan
Debtors' Counsel: Leslie A. Cohen, Esq.
Liner, Yankelevitz, Sunshine & Regenstreif, LLP
1100 Glendon Avenue, 14th Floor
Los Angeles, California 90024-3503
Tel: (310) 500-3500
Fax: (310) 500-3501
Estimated Assets Estimated Debts
---------------- ---------------
The Pemma Corporation $500,000 to $500,000 to
$1 Million $1 Million
HMS Holding Co. $1 Million to $1 Million to
$10 Million $10 Million
A. The Pemma Corporation's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
All Transmission Parts Trade Debt $90,313
1814 NE Argyle Street
Portland, OR 97211
State Fund of California Trade Debt $46,876
P.O. Box 11910
Santa Ana, CA 92711
Freudenberg-Nok Trade Debt $43,410
11617 State Route 13
Milan, OH 44846
Care West Insurance Insurance $9,000
United Parcel Service Trade Debt $7,786
Total Gear & Drivetrain Trade Debt $7,785
Shell Oil Trade Debt $5,850
Blue Cross Insurance Premium $5,643
Alto Products Trade Debt $4,192
Superior Trans Parts Trade Debt $3,584
Carfel Inc. Trade Debt $3,040
Borg Warner Inc. Trade Debt $2,575
All Automatic Trans Parts Trade Debt $2,142
G&K Services SA Trade Debt $2,025
SCE Utilities $1,500
AT&T Utilities $1,500
Performance Powertrain Product Trade Debt $1,464
SPX-Filtran Trade Debt $1,286
Hayden Automotive Trade Debt $1,192
Daylight Transport LLC Trade Debt $1,118
B. HMS Holding Co.'s 6 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Margolis & Morin LLP Legal Fees $48,271
444 South Flower St., 6th Floor
Los Angeles, CA 90071
Zamucen Currn Court ordered $32,492
Holmes & Hanzich LLP amounts due
17848 SkyPark Circle
Irvine, CA 92614
Robert Miller Legal Fees $26,383
2529 Foothill Boulevard
Suite 105
La Crescenta, CA 91214
State Farm Insurance Insurance $5,057
900 Old River Road
Bakersfield, CA 93311
Cella Lange & Cella LLP Legal Fees $3,823
23120 Alicia Parkway, Suite 200
Mission Viejo, CA 92692
Dykema Gossett PLLC Legal Fees $1,447
400 Renaissance Center
Detroit, MI 48243
PIEDMONT MUTUAL: A.M. Best Says Financial Strength Is Weak
----------------------------------------------------------
A.M. Best Co. has downgraded the financial strength rating to C-
(Weak) from C+ (Marginal) of Piedmont Mutual Insurance Company
(Statesville, NC) following an analysis of the company's third
quarter results. The rating outlook remains negative.
The analysis revealed a continued material erosion of Piedmont's
surplus in 2005. These results continue to be driven by
operations. Subsequently, the rating will be withdrawn and an FSR
rating of NR-4 (Company Request) assigned in response to
management's request that Piedmont be removed from A.M. Best's
interactive rating process.
A.M. Best Co., established in 1899, is the world's oldest and most
authoritative insurance rating and information source.
PHILLIPS-VAN HEUSEN: Earns $40.3MM of Net Income in Third Quarter
-----------------------------------------------------------------
Phillips-Van Heusen Corporation reported 2005 third quarter GAAP
net income of $40.3 million, which compares with the prior year's
third quarter GAAP net income of $26.7 million. Third quarter
2004 net income, exclusive of restructuring and other items, was
$30.6 million.
For the current year's nine months, GAAP net income was
$88.8 million, which compares with the prior year's GAAP net
income of $41.3 million.
Total revenues in the third quarter increased 13% to
$533.2 million from $473.5 million in the prior year.
Contributing to the increase was significant revenue growth in the
Company's dress shirt and sportswear businesses. For the nine
months, total revenues were $1,448.8 million, an increase of 18%
over the prior year amount of $1,227.6 million.
From a balance sheet perspective, the company ended the quarter
with over $170 million in cash and reduced its overall net debt by
$76 million compared with the comparable prior year period. The
Company's higher year over year cash position also contributed to
a 13% decrease in net interest expense in the current year's third
quarter.
"We are extremely pleased that the Company has maintained its
positive business momentum through the first nine months of the
year," Mark Weber, Chief Executive Officer, noted. "This is
especially encouraging given that there was a backdrop of
uncertainty leading into the third quarter concerning the overall
economic environment and consumer spending.
Phillips-Van Heusen Corporation -- http://www.pvh.com/-- is one
of the world's largest apparel companies. It owns and markets the
Calvin Klein brand worldwide. It is the world's largest shirt
company and markets a variety of goods under its own brands: Van
Heusen, Calvin Klein, IZOD, Arrow, Bass and G.H. Bass & Co.,
Geoffrey Beene, Kenneth Cole New York, Reaction Kenneth Cole, BCBG
Max Azria, BCBG Attitude, Sean John, MICHAEL by Michael Kors,
Chaps and Donald J. Trump Signature.
Phillips-Van Heusen's 7-3/4% Debentures due 2023 carry Moody's
Investors Service's Ba3 rating and Standard and Poor's BB+ rating.
PRESTWICK CHASE: McNeary Says Chapter 11 Trustee Unnecessary
------------------------------------------------------------
Frederick J. McNeary, Sr., president and shareholder of Prestwick
Chase, Inc., wants the U.S. Bankruptcy Court for the Northern
District of New York to deny APC Partners II, LLC's request for
the appointment of either a chapter 11 trustee or an examiner in
both his and Prestwick's separate bankruptcy cases.
APC, which holds approximately $4.2 million in secured claims
against the estates of Mr. McNeary and Prestwick, asked for the
appointment of a chapter 11 Trustee after concluding that
Prestwick's business has been seriously mismanaged.
As reported in the Troubled Company Reporter on Oct. 2, 2005,
APC's accusations included, among other things:
a) Prestwick's prepetition misappropriation of over $300,000
in tenant security deposits;
b) failure to disclose financial information such as bank
records, accurate rent rolls, provide certifications of
financial disclosures;
c) improper payments of Prestwick to or for the benefit of
insiders;
d) Mr. McNeary Sr.'s failure to acknowledge or act upon
meritorious and valuable causes of action involving his
home in Saratoga Springs and golf community condominium in
the Palm Beach area of Florida;
e) management inexperience in Prestwick's business; and
f) failure to file a plan of reorganization.
Mr. McNeary's Side of the Story
Mr. McNeary says APC's request for the appointment of a chapter 11
Trustee or an examiner is unwarranted because APC has not met its
burden of proof to support such an extraordinary remedy.
Mr. McNeary says that none of APC's allegations address
improprieties in his personal bankruptcy case. APC's motion,
according to Mr. McNeary, focuses exclusively on Prestwick's
bankruptcy case.
Mr. McNeary says that APC has failed to show that he is not
trustworthy and that the local business community lacks confidence
in him. He adds that no other creditor supports the appointment
of a chapter 11 Trustee or examiner.
Mr. McNeary refutes APC's insinuations that he has tried to
conceal certain of his assets.
APC had accused Mr. McNeary of failing to disclose the 10 shares
of Putnam Brook stock he owns as well as a $50,000 prepetition
transfer made to his wife's account to pay for hurricane damage on
a townhouse in Florida.
Mr. McNeary contends that the omission was a plain administrative
oversight and therefore does not rise to the level of fraud
suggested by APC. In fact, Mr. McNeary says APC has failed to
show that he has been uncooperative in the disclosure of relevant
financial information.
Headquartered in Saratoga Springs, New York, Prestwick Chase, Inc.
-- http://www.prestwickchase.com/-- offers senior housing and
independent living as an alternative to home ownership. The
Company filed for chapter 11 protection on March 11, 2005 (Bankr.
N.D.N.Y. Case No. 05-11456). Robert J. Rock, Esq., at Albany, New
York, represents the Debtor in its restructuring efforts. When
the Debtor filed for protection from its creditors, it estimated
assets and debts of $10 million to $50 million.
Frederick J. McNeary, Sr., is a real estate developer and broker.
He is also a shareholder of bankrupt Prestwick Chase, Inc., which
filed for chapter 11 protection on March 11, 2005 (Bankr. N.D.N.Y.
Case No. 05-11456). Mr. McNeary filed for chapter 11 protection
on April 29, 2005 (Bankr. N.D.N.Y. Case No. 05-13007). Howard M.
Daffner, Esq., at Segel, Goldman, Mazzotta & Siegel, P.C.,
represents the Debtor. When Mr. McNeary filed for protection from
his creditors, he estimated less than $50,000 in assets and listed
$10 million to $50 million in debts.
PROTECTION ONE: Posts $3 Mil. Net Loss in 3rd Qtr. Ended Sept. 30
-----------------------------------------------------------------
Protection One, Inc. (OTCBB: PONN) a provider of security
monitoring services in the United States, reported unaudited
financial results for the third quarter ended Sept. 30, 2005.
"I am pleased to report our Protection One Monitoring reporting
unit added 13% more retail recurring monthly revenue in the third
quarter of 2005 than in the third quarter of 2004 even as our
business and customers faced the challenges of an unprecedented
hurricane season, Richard Ginsburg, President and CEO, commented.
"As one of the few national, full-service commercial and
residential companies in our industry, we continue to focus our
efforts on closing the gap between retail losses and additions by
leveraging our infrastructure and our new capital structure."
Third Quarter Fiscal 2005 Results
The Company realized monitoring and related services revenues of
$61.5 million, compared to $62.3 million in the third quarter of
fiscal 2004, a decrease of 1.3%. Hurricane Katrina, which
principally affected the Company's operations in New Orleans,
resulted in the suspension of billing on approximately
$0.1 million of RMR during the month of September and reduced
monitoring and related service revenues in the quarter by that
amount.
Total revenues were $65.6 million compared to $67.5 million in the
third quarter of fiscal 2004. Most of this decline is
attributable to lower amortization of previously deferred
installation revenues which were reduced by push-down accounting
adjustments.
Net loss in the third quarter of 2005 was $3.3 million, compared
to $16.7 million in the third quarter of fiscal 2004. The per
share calculation for the third quarter of 2004 has been adjusted
to give retroactive effect to the one-share-for-fifty shares
reverse stock split.
Reflecting the one-share-for-fifty-shares reverse stock split and
the debt-for-equity exchange that occurred in the first quarter of
2005, the weighted average number of outstanding shares was
18,198,571 in the third quarter of 2005, compared to 1,965,654 in
the third quarter of fiscal 2004.
Year to Date Fiscal 2005 Results
The Company realized monitoring and related services revenues of
$26.5 million in the 39-day period commencing Jan. 1, 2005, and
ending with and including Feb. 8, 2005, and $158.1 million in the
234-day period beginning after that date and ending on Sept. 30,
2005, utilizing the push-down method as the new basis of
accounting. These revenues for the nine months ended Sept. 30,
2005, which were not affected by the push-down accounting
adjustments, decreased by 0.7% compared to the $186 million of
monitoring and service revenues realized in the same period one
year ago. For comparison purposes, monitoring and related
services revenues for the nine months ended Sept. 30, 2004,
decreased by 3.9% compared to the same period in 2003.
Total revenues in the pre- and post-push down periods were
$28.5 million and $168 million, respectively, and were
$201.9 million in the first nine months of fiscal 2004.
Net loss in the pre- and post-push down periods in the first three
quarters of fiscal 2005 was $11.4 million, and $14.4 million,
respectively. The per share calculation for the first three
quarters of 2004 has been adjusted to give retroactive effect to
the one-share-for-fifty shares reverse stock split. The net loss
in the first three quarters of fiscal 2004 included a
$285.9 million, non-cash charge against income to establish a
valuation allowance for non-realizable deferred tax assets
resulting from the sale of the Company, which ended the Company's
participation in a consolidated tax group with its former parent
company.
Reflecting the one-share-for-fifty-shares reverse stock split and
the debt-for-equity exchange, the weighted average number of
outstanding shares was 18,198,571 in the post-push down period and
1,965,654 in the pre-push down period and in the first three
quarters of fiscal 2004.
Adjusted EBITDA
Adjusted earnings before interest, taxes, depreciation,
amortization and other items in the third quarter of fiscal 2005
was $21.5 million, down from $22.9 million in the third quarter of
fiscal 2004, primarily due to expanding our organic retail sales
programs which reduce EBITDA due to the expensing of certain sales
overhead costs.
Adjusted EBITDA in the pre- and post-push down periods in the
first nine months of fiscal 2005 was $9 million and $55.1 million,
respectively, and was $66.5 million in the first nine months of
fiscal 2004.
Balance Sheet
Total debt reflected on the Company's balance sheet as of
Sept. 30, 2005, net of discounts, was $323.0 million, compared to
total debt on December 31, 2004, including premiums, of $505.8
million. The face value of debt outstanding on September 30,
2005, was $344.8 million, 31.8% lower than the $505.5 million
outstanding on December 31, 2004.
The Company's cash and equivalents as of September 30, 2005, were
$14.6 million, compared to $52.5 million at the end of 2004.
Push-Down Accounting
On Feb. 8, 2005, the Company consummated a debt-for-equity
exchange with affiliates of Quadrangle Group LLC that resulted in
Quadrangle reducing the aggregate principal amount outstanding
under the Company's credit facility with Quadrangle by
$120 million in exchange for 16 million shares of the Company's
common stock. The issuance of the new shares, together with
shares already owned by Quadrangle, resulted in Quadrangle owning
approximately 97.3% of the Company's common stock.
As a result of Quadrangle's increased ownership interest from the
Feb. 8, 2005, debt-for-equity exchange, the Company has "pushed
down" Quadrangle's basis to a proportionate amount of its
underlying assets and liabilities acquired, based on the estimated
fair market values of the assets and liabilities.
A full-text copy of Protection One's quarterly report for the
quarter ending Sept. 30, 2005, is available at no charge at
http://ResearchArchives.com/t/s?318
Headquartered in Lawrence, Kansas, Protection One, Inc. --
http://www.ProtectionOne.com-- is one of the largest providers of
security monitoring services in the United States. Including its
Network Multifamily subsidiary, a leading security provider to the
multifamily housing market, Protection One provides monitoring and
related security services to more than one million residential and
commercial customers. For more information about Protection One,
visit
PROTOCOL SERVICES: Panel Hires Higgs Fletcher as Chap. 11 Counsel
-----------------------------------------------------------------
The Honorable James W. Meyers of the U.S. Bankruptcy Court for the
Southern District of California authorized the Official Committee
of Unsecured Creditors of Protocol Services, Inc., and its debtor-
affiliates to retain John L. Morell, Esq., Martin A. Eliopulos,
Esq., Paul J. Leeds, Esq., and other members of the law firm of
Higgs, Fletcher & Mack, LLP, as their general bankruptcy and
litigation counsel.
Higgs Fletcher will:
a) advise the Committee on matters of bankruptcy law;
b) represent the Committee in proceedings or hearings in the
Bankruptcy Court involving matters of bankruptcy law.
c) advise the Committee concerning the requirements of the
Bankruptcy Code and rules relating to administration of
this bankruptcy case; and
d) assist the Committee in the negotiation, formulation,
confirmation, and implementation of a Plan of
Reorganization.
The hourly rates for Higgs Fletcher's professionals assigned to
work on this case are:
Professional Designation Hourly Rate
------------ ----------- -----------
John L. Morell, Esq. Partner $350
Martin A. Eliopulos, Esq. Partner $315
Paul J. Leeds, Esq. Associate $225
The Firm may also utilize the services of its other professionals
at these rates:
Designation Hourly Rate
----------- -----------
Partners $200 to $350
Associates $125 to $200
Paralegals $85 to $115
To the best of the Committee's knowledge, neither Higgs Fletcher
nor any of its attorneys have any connection with the Debtors,
their creditors an other parties-in-interest in this case, except
as stated in Mr. Morell's declaration.
Headquartered in Deerfield, Illinois, Protocol Services, Inc., and
its subsidiaries offers agency services, database development and
management, data analysis, direct mail printing and lettershops,
e-marketing, media replication, and inbound and outbound
teleservices. Protocol has offices and operations in
California, Colorado, Illinois, Louisiana, Florida, Michigan,
North Carolina, New York, Massachusetts, Connecticut and Canada
and employs over 4,000 individuals. The Company and its
affiliates -- Protocol Communications, Inc., Canicom, Inc., Media
Express, Inc., and 3588238 Canada, Inc. -- filed for chapter 11
protection on July 26, 2005 (Bankr. S.D. Calif. Case Nos. 05-06782
through 05-06786). Bernard D. Bollinger, Jr., Esq., and Jeffrey
K. Garfinkle, Esq., at Buchalter, Nemer, Fields & Younger,
represent the Debtors in their restructuring efforts. When the
Debtors filed for protection from their creditors, they estimated
more than $100 million in assets and debts.
REINHOLD INDUSTRIES: Completes Sale of NP Aerospace for $53.4 Mil.
------------------------------------------------------------------
Reinhold Industries, Inc. (Nasdaq: RNHDA) of Santa Fe Springs,
California reported that the sale of NP Aerospace to The Carlyle
Group closed on Nov. 21, 2005. The total purchase price of $53.4
million provides Reinhold approximately $40 million of net
proceeds after taxes and expenses. Reinhold will use these net
proceeds to pay off all of its outstanding indebtedness of
approximately $25.7 million.
Reinhold also declared on Nov. 21, 2005 a special dividend of
$6.00 per share to all shareholders of record on Dec. 16, 2005
payable on Jan. 3, 2006. The special dividend will return
approximately $19.6 million to Reinhold shareholders and will be
funded by:
(1) the remaining net proceeds from the sale of NP Aerospace,
and
(2) a new credit facility with LaSalle Bank.
The new credit facility will consist of:
* a new term loan of $5.5 million payable over four years, and
* a new revolving credit facility of up to $4.5 million.
Reinhold expects to have more than $4 million in availability
under this new revolver after paying the special dividend.
Reinhold also said on Nov. 21, 2005, that it will discontinue its
previous policy of paying regular quarterly dividends. As
previously announced, Reinhold will pay a quarterly dividend of
$0.50 per share to shareholders of record as of Dec. 2, 2005
payable on Dec. 16, 2005. This will be Reinhold's last
quarterly dividend under its now discontinued policy.
"Over the last two years, Reinhold has returned significant value
to its shareholders. Including the special $6.00 per share
dividend declared today, Reinhold will have paid $20.75 per share
in aggregate dividends since September 2004," said Ralph R.
Whitney, Jr., Chairman of the Board.
Michael T. Furry, Reinhold's President and CEO commented:
"Management will now focus on reducing operating expenses and
managing the Company's remaining domestic businesses. The cash
flow generated from these businesses will be used primarily to
reduce the Company's indebtedness."
William Blair & Company acted as the financial advisor to Reinhold
in connection with the sale of NP Aerospace.
Reinhold Industries, Inc. is a manufacturer of advanced custom
composite components and sheet molding compounds for a variety of
applications in the United States.
At Sept. 30, 2005, Reinhold Industries, Inc.'s balance sheet
showed a $4,495,000 stockholders' deficit compared to a $3,190,000
deficit at Dec. 31, 2004.
REMINGTON ARMS: Raw Material Costs Cue S&P to Junk Credit Rating
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on
Remington Arms Co. Inc., including lowering its corporate credit
rating to 'CCC+' from 'B', based on escalating raw material and
utility costs, which have meaningfully affected profitability,
debt leverage, and liquidity. The outlook is negative.
Madison, North Carolina-based Remington Arms had total debt
outstanding of $271 million, including $32 million of RACI Holding
Co. debt, at Sept. 30, 2005.
"The rating action reflects the continuing negative effects from
higher input prices, which have been only modestly offset by
Remington Arms' price increases, and the expectation that the
pressure on profitability and, more importantly, liquidity, will
intensify," said Standard & Poor's credit analyst Andy Liu.
Given the escalation of raw material costs, Remington Arms is
planning another round of price increases across most of its
products. These price increases could help Remington Arms recoup
some margin if raw material prices stabilize.
Adding to our concerns about raw material costs, the
sustainability of Remington Arms' pricing power remains highly
uncertain. It is conceivable that new price increases could
curtail consumer demand for firearms.
Also, declining consumer confidence and the negative impact of
higher energy prices on consumer discretionary spending could
weaken demand going into 2006.
RESIDENTIAL ASSET: Moody's Rates Class B-7 Certificates at Ba2
--------------------------------------------------------------
Moody's Investors Service assigned Aaa and Aa1 ratings to the
senior certificates issued by Residential Asset Securitization
Trust 2005-A11CB and ratings ranging from Aa2 to Baa3 on the
subordinate certificates. Moody's is now rating the Class B-7
certificate Ba2.
The securitized pool is comprised of fixed-rate loans originated
by IndyMac Bank F.S.B. The ratings are primarily based on the
quality of the collateral and the levels of protection afforded by
structural subordination. The credit quality of the loan pool is
generally consistent with that of collateral backing other recent
IndyMac fixed rate Alt-A securitizations. The expected pool loss
is in the range of 0.50% to 0.75%.
IndyMac Bank F.S.B. will be the master servicer of the mortgage
loans.
The complete rating action is:
Residential Asset Securitization Trust 2005-A11CB:
* Class B-7, Subordinate, Variable Rate Certificate rated Ba2
The certificate was issued under Rule 144A under the Securities
Act of 1933, as amended.
REUNION INDUSTRIES: Sept. 30 Balance Sheet Upside Down by $24 Mil.
------------------------------------------------------------------
Reunion Industries, Inc., delivered its financial reports for the
quarter ending Sept. 30, 2005, to the Securities and Exchange
Commission on Nov. 14, 2005.
The Company reported $1,923,000 of net income on $17,294,000 of
sales for the three months ending Sept. 30, 2005. At Sept. 30,
2005, the company's balance sheet showed $52,219,000 in total
assets, $76,215,000 in total liabilities, resulting in a
$24,319,000 stockholders' deficit. Reunion's Sept. 30 balance
sheet also shows strained liquidity with $26,267,000 in current
assets available to satisfy $63,565,000 of current liabilities
coming due within the next 12 months.
A full-text copy of Reunion Industries, Inc.'s financial reports
for the quarter ending Sept. 30, 2005, is available for free at
http://ResearchArchives.com/t/s?315
Headquartered in Pittsburgh, Pennsylvania, Reunion Industries,
Inc. -- http://www.reunionindustries.com-- owns and operates
industrial manufacturing operations that design and manufacture
engineered, high-quality products for specific customer
requirements, such as large-diameter seamless pressure vessels,
hydraulic and pneumatic cylinders, grating and precision plastic
components.
* * *
Going Concern Doubt
As previously reported in the Troubled Company Reporter on
Apr. 29, 2005, Mahoney Cohen & Company, CPA, P.C., raised
substantial doubt about Reunion Industries, Inc.'s ability to
continue as a going concern after it audited the Company's Form
10-K for the fiscal year ended Dec. 31, 2004. The auditors cited
four factors that triggered the going concern opinion:
-- the Company's $13.3 million working capital deficit,
-- a loss from continuing operations of $3.5 million before
gain on debt extinguishment,
-- cash used in operating activities of $3.3 million, and
-- a deficiency in assets of $25.6 million.
SAINT VINCENTS: Settles Insurance Controversy with A.I. Credit
--------------------------------------------------------------
Saint Vincents Catholic Medical Centers of New York and its
debtor-affiliates have signed a stipulation resolving A.I. Credit
Corporation's request to lift the automatic stay to terminate
certain insurance policies.
As reported in the Troubled Company Reporter on Oct. 28, 2005,
A.I. Credit wanted to cancel the insurance policies it financed in
favor of the Debtors pursuant to their Premium Financing
Agreements. The Debtors allegedly failed to pay for the
$1,402,723 in scheduled payments due on July 1, 2005.
In a stipulation approved by the U.S. Bankruptcy Court for the
Southern District of New York, the parties agree that:
(a) AICC will withdraw with prejudice its request to lift the
stay under Section 362 of the Bankruptcy Code to terminate
the insurance policies financed under the Premium
Financing Agreements;
(b) if the Debtors fail to make the November 1, 2005,
Payments, AICC may file a new request to lift the stay;
and
(c) the automatic stay is not modified with respect to the
Agreements, and the stipulation will not be construed to
authorize the cancellation of the Insurance Policies
without the Court's further order.
A.I. Credit Corporation confirms that:
(a) as of October 18, 2005, the Debtors have made all payments
due under the Premium Financing Agreements;
(b) it remains oversecured; and
(c) only one payment remains to be made under each of the
Agreements on November 1, 2005.
Headquartered in New York, New York, Saint Vincents Catholic
Medical Centers of New York -- http://www.svcmc.org/-- the
largest Catholic healthcare providers in New York State, operate
hospitals, health centers, nursing homes and a home health agency.
The hospital group consists of seven hospitals located throughout
Brooklyn, Queens, Manhattan, and Staten Island, along with four
nursing homes and a home health care agency. The Company and six
of its affiliates filed for chapter 11 protection on July 5, 2005
(Bankr. S.D.N.Y. Case No. 05-14945 through 05-14951). Gary
Ravert, Esq., and Stephen B. Selbst, Esq., at McDermott Will &
Emery, LLP, represent the Debtors in their restructuring efforts.
As of Apr. 30, 2005, the Debtors listed $972 million in total
assets and $1 billion in total debts. (Saint Vincent Bankruptcy
News, Issue No. 14; Bankruptcy Creditors' Service, Inc.,
215/945-7000)
SAINT VINCENTS: Court Allows Access to $35 Mil. Commerce Bank Loan
------------------------------------------------------------------
The Hon. Prudence Carter Beatty of the U.S. Bankruptcy Court for
the Southern District of New York gave her final stamp of approval
to Saint Vincent Catholic Medical Centers request for permission
to borrow up to $35,000,000 from Commerce Bank, N.A.
The Court directs SVCMC to pay all necessary fees and expenses so
as to perform all of its obligations under the Commerce Final
Financing Order and the Commerce DIP Loan Agreement without any
further Court order.
Commerce is granted a first priority, perfected senior priming
lien superior to all other liens of any other creditor upon all
of the Collateral, as defined in the Commerce DIP Loan Agreement,
to secure the Debtors' DIP Obligations.
All parties-in-interest, including the Official Committee of
Unsecured Creditors, are barred from challenging the validity,
enforceability, perfection, and priority of the Prepetition Debt,
Commerce's prepetition security interest in and prepetition Liens
on the Pools for the years 2005 and 2006, Commerce's
Superpriority Administrative Expense Claim, the Commerce DIP
Facility and any Lien or security interest granted.
The United States Department of Housing and Urban Development has
withdrawn its objection to the request, without prejudice to its
rights, including but not limited to any issue of valuation or
adequate protection that may arise.
A full-text copy of the Court's Final Commerce DIP Financing
Order is available at no charge at:
http://bankrupt.com/misc/SVCMC_commercedip_final_order.pdf
Headquartered in New York, New York, Saint Vincents Catholic
Medical Centers of New York -- http://www.svcmc.org/-- the
largest Catholic healthcare providers in New York State, operate
hospitals, health centers, nursing homes and a home health agency.
The hospital group consists of seven hospitals located throughout
Brooklyn, Queens, Manhattan, and Staten Island, along with four
nursing homes and a home health care agency. The Company and six
of its affiliates filed for chapter 11 protection on July 5, 2005
(Bankr. S.D.N.Y. Case No. 05-14945 through 05-14951). Gary
Ravert, Esq., and Stephen B. Selbst, Esq., at McDermott Will &
Emery, LLP, represent the Debtors in their restructuring efforts.
As of Apr. 30, 2005, the Debtors listed $972 million in total
assets and $1 billion in total debts. (Saint Vincent Bankruptcy
News, Issue No. 14; Bankruptcy Creditors' Service, Inc., 215/945-
7000)
SAKS INC: Moody's Confirms B2 Corporate Family & Sr. Debt Ratings
-----------------------------------------------------------------
Moody's Investors Serviced confirmed the long term debt ratings of
Saks Incorporated and assigned a positive outlook. The
confirmation recognizes that Saks' leverage will substantially
increase above its current levels during 2006 as it will be
supporting its current levels of debt with a much smaller business
(assuming the close of the sale of the Northern Department Store
Group to Bon-Ton).
The positive outlook reflects the likelihood that Saks will be
able to reduce this expected high leverage over the next 12 to 18
months by cutting back corporate overhead and/or improving its
operating performance. This rating action concludes the review
for possible upgrade announced on August 4, 2005.
The B2 corporate family rating reflects Moody's expectation that
the sale of the Northern Department Store Group (excluding
Parisian and Club Libby Lu) to Bon-Ton closes in the first quarter
of 2006 and that there will be no further near term reduction in
funded debt from the proceeds generated by the sale. Moody's
notes that Saks significantly reduced its debt levels in July 2005
from the proceeds of the asset sale to Belk.
In addition, the rating reflects the likelihood that operating
income will be constrained once the service agreements with Belk
and Bon Ton expire, resulting in operating profits from a smaller
group -- SFAE, Parisian, and Club Libby Lu -- supporting a
disproportionately large corporate overhead base. It is Moody's
opinion that it will take time for the Saks' management team to
align the corporate overhead expenses to a smaller organization.
Negative rating factors include:
* Saks' position as a weaker player in the high end department
store sub-segment competing against Nordstrom and
Neiman Marcus;
* its heavy reliance on its Manhattan store (Moody's expects it
to be approximately 14% of total sales going forward); and
* the ongoing SEC investigation that resulted from the internal
investigations conducted by Saks.
Ratings are supported by:
* the company's continued healthy liquidity;
* solid asset base with a sizable real estate portfolio
(including the flagship Fifth Avenue store); and
* its focus going forward on the strong performing high end
luxury segment.
Moody's is assuming that, proforma for the sale to Bon Ton, LTM
EBITDA (assuming service revenue from Belk and Bon Ton) for the
period ending October 31, 2005 is approximately $180 million,
resulting in Debt/EBITDA(calculated using Moody's standard
analytical adjustments) of approximately 5.4x.
Assuming no service revenue from Belk and Bon Ton and no reduction
in corporate overhead, Moody's is assuming that LTM EBITDA for the
period ending October 31, 2005 would be reduced to $154 million,
resulting in Debt/EBITDA(calculated using Moody's standard
analytical adjustments) of 5.9x.
The positive outlook reflects Moody's expectation that management
may significantly reduce corporate overhead expenses over the next
12 to 18 months and that operating performance may modestly
improve now that management is no longer distracted by the
internal investigation.
Ratings could move upward should operating performance improve or
funded debt levels be reduced such that for SFAE, Parisian, and
Club Libby Lu standalone; Debt/EBITDA (calculated using Moody's
standard adjustments) falls below 4.5x and EBITDA margin (as
reported) rises above 6%.
Given the positive outlook, it is highly unlikely that ratings
would be downgraded. However ratings could stabilize should
Debt/EBITDA (calculated using Moody's standard adjustments) be
sustained above 5.5x and if EBITDA margin (as reported for SFAE,
Parisian, and Club Libby Lu) fails to rise above 5.25%.
Downward rating pressure would develop should Debt/EBITDA
(calculated using Moody's standard adjustments) be sustained above
6.25x and should EBITDA margin (as reported) fall below 4%.
In addition, downward ratings pressure would ensue should
management's financial policy become more aggressive or should the
SEC investigation be finalized with a materially adverse result.
The senior unsecured guaranteed notes are rated at the same level
as the corporate family rating reflecting the sizable unencumbered
real estate portfolio that provides asset coverage for the senior
notes, as well as the subsidiary guarantees.
These ratings are confirmed:
* Corporate family rating of B2
* Senior unsecured debt guaranteed by operating subsidiaries
of B2
Saks Incorporated, headquartered in Birmingham, Alabama, operates
approximately 200 department stores and specialty stores under the
names:
* Saks,
* Parisian,
* Off 5th, and
* Club Libby Lu.
Proforma for the spin offs revenues for SFAE, Parisian, and Club
Libby Lu were approximately $$3.5 billion for fiscal year 2004.
SBA COMMUNICATIONS: Completes Offering of $405 Million Certs.
-------------------------------------------------------------
SBA Communications Corporation (Nasdaq: SBAC) reported that SBA
CMBS-1 Depositor LLC, an indirect subsidiary of SBA, has completed
the sale, in a private transaction, of its previously announced
offering of $405 million of Commercial Mortgage Pass-Through
Certificates, Series 2005-1 issued by SBA CMBS Trust, a trust
established by SBA CMBS-1 Depositor LLC. The assets of SBA CMBS
Trust consist of a non-recourse mortgage loan to SBA Properties,
Inc., interest on which will be paid from the operating cash flows
of 1,714 of its tower sites. The mortgage loan is secured by
mortgages on substantially all of such tower sites and their
operating cash flows.
The Certificates consist of five classes, all of which are rated
investment grade. The contract weighted average fixed interest
rate of the Certificates is 5.6%, and the effective weighted
average fixed interest rate to the borrower is 4.8%, on a GAAP
basis, after giving effect to a settlement gain of an interest
rate swap entered in contemplation of the transaction. The
Certificates have an expected life of five years with a final
repayment date in 2035.
The net proceeds received from this offering were used to purchase
the existing mortgage loan from the existing lenders under the
outstanding credit facility of SBA Senior Finance, Inc., a
subsidiary of SBA, to fund reserves and pay expenses associated
with the offering. The remainder of the net proceeds were
distributed to SBA Senior Finance, Inc. who may distribute them or
contribute them to any other SBA entity or use them for any
purpose.
The Certificates are comprised of five subclasses, including
$238.6 million principal amount of 2005-1A Certificates, receiving
the highest investment grade of:
* Aaa by Moody's Investor Services and
* AAA by Fitch Ratings.
The Certificate Subclasses B, C and D are each comprised of
$48.3 million of Certificates and are rated:
* Aa2, A2 and Baa2 by Moody's Investor Services and
* AA, A and BBB by Fitch Ratings.
The Certificate Subclass E is comprised of $21.5 of Certificates
and is rated:
* Baa3 by Moody's Investor Services and
* BBB- by Fitch Ratings.
Based in Boca Raton, Florida, SBA Communications --
http://www.sbasite.com/-- is a leading independent owner and
operator of wireless communications infrastructure in the United
States. SBA generates revenue from two primary businesses -- site
leasing and site development services. The primary focus of the
Company is the leasing of antenna space on its multi-tenant towers
to a variety of wireless service providers under long-term lease
contracts. Since it was founded in 1989, SBA has participated in
the development of over 25,000 antenna sites in the United States.
* * *
As reported in the Troubled Company Reporter on Oct. 5, 2005,
Moody's Investors Service placed the ratings of SBA Communications
and subsidiaries on review for possible upgrade, as outlined
below. This ratings action is based upon the company's recent
sale of common equity and dedicating the proceeds to the
repurchase of approximately $120 million of debt.
The ratings placed on review are:
SBA Communications Corp.:
* Corporate family rating of B2
* 8.5% Senior Notes due 2012 rated Caa1
* SBA Telecommunications, Inc.
* 9.75% Senior Discount Notes due 2011 rated B3
SBA Senior Finance, Inc.:
* $75 million senior secured revolving credit facility due 2008
rated B1
* $325 million senior secured term loan due 2008 rated B1
SFX ENT: S&P Assigns B+ Rating on Proposed $575-Mil Secured Loans
-----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' long-term
corporate credit rating to SFX Entertainment Inc. The outlook is
negative.
At the same time, SFX's proposed $575 million secured credit
facilities were rated 'B+', at the same level as the corporate
credit rating, with a recovery rating of '3', indicating the
expectation for meaningful recovery of principal in the event of a
payment default. Borrowings under the proposed facilities are
expected to be used to repay intercompany debt in connection with
SFX Entertainment's spin-off from Clear Channel Communications
Inc. and for general corporate purposes.
The Los Angeles-based promoter, producer, and venue operator for
live entertainment will have approximately $383 million of debt
outstanding, pro forma for the proposed transaction.
"The rating on SFX Entertainment reflects financial risk from a
high lease-adjusted debt to EBITDA ratio, a low EBITDA margin with
the potential for only modest expansion, and business volatility
stemming from content availability, talent costs, the general
economic environment, and soft attendance trends," said Standard &
Poor's credit analyst Alyse Michaelson Kelly. "These factors are
partially offset by the company's good competitive position in the
live entertainment industry, its significant geographic and
format diversity, and historical discretionary cash flow."
Business risk is a key rating concern. The live music segment,
including the promotion and production of music concerts,
generates approximately 80% of total revenues. Profitability is
determined by:
* sellout levels,
* per capita spending,
* artist payments, and
* production costs.
Standard & Poor's expects the company's North American music
business to be flat, at best, in 2006.
The company's theater business generates approximately 11% of
total revenues. Tickets are presold through one of the largest
subscription series in the U.S. and Canada. Theater is a less
volatile business than concert tours, with acts that periodically
reach a wider-than-expected audience. However, the unit's EBITDA
has been flat in the past few years because of the lack of hit
productions.
Pro forma total debt, including $40 million in preferred stock, to
EBITDA is expected to be 3x in 2005. The preferred stock is
mandatorily redeemable and is expected to pay a 10% cash dividend.
Because the company leases the majority of its venues worldwide,
its lease obligations are sizable. Pro forma lease-adjusted total
debt, including preferred stock, to EBITDA is expected to be
around 5.5x in 2005.
Negative revenue trends and significant capital spending are
expected to preclude any financial profile improvement next year.
The 5% EBITDA margin has minimal longer term upside potential that
would require changes in business mix, cost controls, and improved
venue utilization, but the company would have to develop new
revenue streams to significantly lift margins. Overhead related
to its 39 owned venues and low venue utilization, especially for
amphitheaters, are characteristic of this business.
The company has historically generated discretionary cash flow.
However, higher capital spending this year and next, in the
$100 million range, and a reversal of favorable working capital
trends are expected to result in negative discretionary cash flow
in 2005 and 2006. The company's ability to return to generating
positive free cash flow in the intermediate term will be an
important rating factor. There are no significant pro forma debt
maturities.
SPX CORP: Enters Into New $1.625 Billion Senior Secured Facilities
------------------------------------------------------------------
SPX Corporation (NYSE: SPW) entered into new syndicated Senior
Secured Credit Facilities in an aggregate amount of $1.625
billion. The new committed credit facilities have improved margin
pricing and are designed to increase the company's global
financial flexibility. The new facilities are comprised of:
* A 5-year, $450 million committed revolving credit line to be
used for general corporate purposes, such as the issuance of
letters of credit. At closing, the new revolving credit
line was undrawn except for outstanding letters of credit.
* A 5-year, $750 million delayed draw term loan facility that
was undrawn at closing. This facility will be available for
six months from the date of close, and may be drawn on to
refinance the company's February Liquid Yield Option Notes
debt and associated tax liability in the event the LYONs are
put to the company or redeemed by the company in February
2006.
* A 5-year, $425 million Foreign Trade Facility for the
purpose of issuing foreign credit instruments such as
standby letters of credit and bank guarantees.
The new committed facilities replace the existing credit
facilities of SPX, which have been terminated.
Patrick J. O'Leary, Executive Vice President and Chief Financial
Officer said, "These new credit facilities provide SPX with the
increased financial flexibility to continue growing our core
business while also addressing the potential February refinancing
event. In addition, we have taken the strategic step to globalize
our credit capacity to align with our expanding international
presence and global growth initiatives."
J.P. Morgan Securities Inc. was the lead arranger and Dresdner
Kleinwort Wasserstein and Deutsche Bank AG arranged the Foreign
Trade Facility.
SPX Corporation -- http://www.spx.com/-- is a leading global
provider of flow technology, test and measurement solutions,
thermal equipment and services and industrial products and
services.
* * *
As reported in the Troubled Company Reporter on Sept. 6, 2005,
Moody's Investors Service upgraded the ratings of SPX Corporation.
The upgrade concludes the rating review initiated on March 4,
2005. After the upgrade, the rating outlook is stable.
Ratings upgraded:
* corporate family rating, to Ba1 from Ba2;
* senior secured credit facility, due 2008, to Ba1 from Ba2;
* 7.5% and 6.25% senior notes, due 2013 and 2011 respectively,
to Ba2 from Ba3; and
* Liquid Yield Option Notes (LYONs), due 2021, to Ba2 from Ba3
The SGL-1 liquidity rating is confirmed.
SKILLED HEALTHCARE: Moody's Rates $200 Mil. Sub. Notes at (P)Caa1
-----------------------------------------------------------------
Moody's assigned a (P)B1 rating to Skilled Healthcare Group,
Inc.'s credit facilities, consisting of a $75 million revolver and
a $260 million first lien term loan, and a (P)Caa1 rating to the
proposed $200 million senior subordinated notes. These ratings,
along with the corporate family rating of (P)B2, have been
assigned on a provisional basis to the successor company. Moody's
also assigned a speculative grade liquidity rating of SGL-2 to
Skilled Healthcare.
Concurrently, Moody's affirmed the ratings of the existing
company, Skilled Healthcare Group, Inc. (Old). The ratings of
Skilled Healthcare Group, Inc. (Old) will be withdrawn and the
provisional ratings will be made final upon the closing of the
transaction.
The proceeds of the subordinated note offering along with $221
million of equity will be used to finance the acquisition of the
company by Onex Corp. The credit facilities, as amended, will be
assumed by the successor company, Skilled Healthcare. The
existing second lien term loan will be repaid at the closing of
the transaction.
The ratings reflect the company's high leverage following the
transaction and lack of geographic diversification. The company
currently operates in only four states with a significant portion
of its operations and EBITDA concentrated in California and Texas.
The ratings also consider Skilled Healthcare's susceptibility to
changes in government reimbursement programs either through
Medicare or Medicaid, and exposure to professional liability
claims against the company.
Also considered in the ratings is Skilled Healthcare's attractive
quality mix, which has contributed to strong margin performance,
and recent acquisitions, such as the Vintage Park Group in Kansas,
that help to diversify the company's geographic concentration.
Additionally, tort reform in Texas applicable to all cases filed
on or after September 1, 2003, limitations on losses due to
bankruptcy protection, and the implementation of an arbitration
program should help limit the company's exposure to professional
liability claims.
The stable outlook anticipates continued favorable operating
performance. Final rules regarding the increase in Medicare rates
for inflation and RUGS refinement contribute to a near-term stable
reimbursement environment that, along with moderate expectations
for capital expenditures, should provide the company with free
cash flow to decrease leverage. Moody's also expects the company
to continue a measured approach to acquisitions. Additionally,
the divestiture of the company's pharmacy business in March 2005
has allowed for increased focus on the growth of the company's
hospice and rehabilitation business.
If the company can continue to expand through growth in the
rehabilitation and hospice business lines and materially reduce
its debt, Moody's could upgrade the ratings. More specifically,
continued growth or debt reduction that results in cash flow from
operations and free cash flow to adjusted debt ratios reaching
sustainable levels above 10% and 7% could result in upward
pressure on the ratings.
Skilled Healthcare is currently among the leaders in the industry
in quality mix, defined as the proportion of non-Medicaid revenue
to total revenue. If the company is unsuccessful in maintaining
this mix of business, resulting in pressure on its healthy EBITDA
margins, then Moody's would likely see pressure on the ratings.
Additionally, if the frequency and severity of professional
liability claims were to increase, resulting in higher accruals
and pressure on operating margins, or if the company's previous
professional liability accruals were understated, resulting in a
higher accrual rate going forward and an associated reduction in
operating margins, the ratings could be downgraded. Moody's would
consider downgrading the rating if a combination of these or other
factors result in cash flow from operations and free cash flow to
adjusted debt ratios that are expected to be sustained below 5%
and 3%, respectively.
Pro forma for the transaction, adjusted operating cash flow
coverage of debt for the fiscal year ending December 31, 2005 is
expected to approximate 5-7% and adjusted free cash flow coverage
of debt is expected to approximate 3-5%. EBIT coverage of
interest is expected to be in the range of 1.5 to 2.0 times for
the same period. Additionally, Moody's expects the ratio of
adjusted debt to adjusted EBITDA for the year ending December 31,
2005 to approach a high 6.0 times on a gross basis, not giving
effect to an additional $34 million of expected cash on hand
following the bond issuance. Moody's understands that this cash
must be used by March 31, 2006 to either repay amounts outstanding
under the term loan or for permitted acquisitions.
The SGL-2 rating reflects Moody's belief that the company will
have good liquidity over the four quarters ending December 31,
2006. Pro forma for the transaction, Skilled Healthcare will have
access to a $75 million revolving credit facility that will be
undrawn at closing. Moody's does not expect the company to draw
on the revolver for working capital or capital expenditures.
Moody's expects cash flow from operations to be adequate to fund
all but extraordinary capital expenditures. Moody's expects the
company to remain in compliance with applicable covenant
requirements.
Additionally, the SGL rating reflects the fact that all assets are
pledged as security under the new credit agreement, which limits
alternative sources of liquidity.
The first lien senior secured facility is rated one notch above
the corporate family rating to reflect the expected recovery based
on an enterprise value and because it is adequately collateralized
by the real property related to the company's 50 owned facilities.
The senior subordinated notes are notched two levels below the
corporate family rating to reflect their subordination to a
significant amount of secured debt.
Moody's ratings are subject to our review of final documentation
for the transaction.
These summarizes Moody's rating actions:
Ratings assigned:
Skilled Healthcare Group, Inc.:
* $75 million senior secured revolving credit facility
due 2010, rated (P)B1
* $260 million senior secured first lien term loan due 2012,
rated (P)B1
* $200 million senior subordinated notes due 2013,
rated (P)Caa1
* Corporate family rating, (P)B2
* Speculative grade liquidity rating, SGL-2
Ratings affirmed (to be withdrawn at close of transaction):
Skilled Healthcare Group, Inc. (Old):
* $50 senior secured revolving credit facility due 2010, B1
* $260 senior secured first lien term loan due 2012, B1
* $110 senior secured second lien term loan due 2012, Caa1
* Corporate family rating, B2
Headquartered in Foothill Ranch, California, Skilled Healthcare
Group, Inc. operates long-term care facilities and provides post-
acute care and rehabilitation services. As of September 2005, the
company operated 57 skilled nursing facilities and 12 stand-alone
assisted living facilities in:
* California,
* Texas,
* Kansas, and
* Nevada.
For the twelve months ended September 30, 2005, Skilled Healthcare
recognized revenues of $411 million.
STONE ENERGY: Bank Group Grants Waiver and Amends Borrowing Base
----------------------------------------------------------------
Stone Energy Corporation (NYSE: SGY) received waivers from the
lenders under its bank credit agreement to extend its time to file
financial statements until December 15, 2005. Additionally, the
participating banks conducted the regularly scheduled semi-annual
borrowing base re-determination and Stone's borrowing base has
been renewed at $300 million, a reduction from the previous
borrowing base of $425 million. The re-determination includes the
impact of Hurricanes Katrina and Rita and the company's previously
announced downward reserve revision. Currently, Stone has $126
million borrowed or committed, leaving $174 million of
availability on the new borrowing base.
Likely Default
As reported in the Troubled Company Reporter on Nov. 16, 2005,
because of the delay in Stone's filings, Stone may not be in
compliance with certain of its obligations to file or deliver to
relevant parties its SEC reports and financial statements under
its public debt indentures and its bank credit agreement.
Stone is seeking waivers from the lenders under its bank credit
agreement to extend its time to file financial statements.
Under two bond debt indentures, the delay in filing the reports
does not automatically result in an event of default. Instead,
the holders of 25% of the outstanding principal amount of any
series of debt securities issued under such indentures would have
to provide notice of non-compliance and Stone would have 60 days
from the receipt of such notice to cure the default. Stone is
providing notice of the delay to the trustee under the indentures,
but has not received notice from these debt holders. If the
default was not cured and an acceleration of debt securities were
to occur, Stone may be unable to meet its payment obligations with
respect to the related debt.
Stone Energy is an independent oil and gas company headquartered
in Lafayette, Louisiana, and is engaged in the acquisition and
subsequent exploration, development, operation and production of
oil and gas properties located in the conventional shelf of the
Gulf of Mexico, deep shelf of the GOM, deep water of the GOM,
Rocky Mountain basins and the Williston Basin.
* * *
As reported in the Troubled Company Reporter on Oct. 10, 2005,
Moody's lowered the Corporate Family Rating for Stone Energy Corp.
to B1 from Ba3 and the ratings on the senior subordinated notes
from B2 to B3 following the company's announcement that it is
taking a significant reserve write-down and that the majority of
its production remains shut-in from the hurricanes. However,
Moody's is still evaluating the company's Speculative Grade
Liquidity Rating of SGL-2 in order to assess the amount and length
of the cash flow impact of the shut-in production as well as what
the impact of the reserve revision will have on Stone's borrowing
base driven revolving credit facility.
The ratings downgrade reflects the write-down of approximately 171
Bcfe (28.5mmboe) of proved reserves following a review of the
company's reserves by a new third party engineering firm.
Notably, the majority of the revisions are in the Proven Developed
(PD) categories, highlighting the inherent subjectivity in the
estimates of all reserves.
Moody's ratings actions for Stone Energy are:
* Downgraded to B1 from Ba3 -- Corporate Family Rating
* Downgraded to B3 from B2 -- $200 million 8.25% senior sub.
notes due 2011
* Downgraded to B3 from B2 -$200 million 6.75% senior sub.
notes due 2014
SOUTHERN GROUP: A.M. Best Says Financial Strength Is Poor
---------------------------------------------------------
A.M. Best Co. has downgraded the financial strength rating of
Southern Group Indemnity, Inc. (Miami, FL) to D (Poor) from C++
(Marginal). The rating outlook has been changed to negative from
stable.
The downgrade reflects the erosion of surplus due to significant
adverse loss reserve development in Southern Group's private
passenger auto line of business reported in the third quarter of
2005. The rating outlook is based on the severe deterioration of
the company's risk-adjusted capitalization and sharp increase in
underwriting leverage.
A.M. Best Co., established in 1899, is the world's oldest and most
authoritative insurance rating and information source.
TARGUS GROUP: S&P Junks Rating on $85 Million First Lien Facility
-----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B' corporate
credit rating on laptop case and computer accessory provider
Targus Group International Inc.
At the same time, Standard & Poor's assigned its 'B' rating and
its '2' recovery rating to the company's revised $230 million
senior secured first lien credit facility, indicating that first
lien lenders can expect substantial recovery of principal in the
event of a payment default or bankruptcy.
In addition, Standard & Poor's assigned its 'CCC+' rating and its
'5' recovery rating to the company's new $85 million second lien
facility, indicating that second lien creditors could expect
negligible recovery of principal in the event of payment default.
Standard & Poor's also withdrew its 'CCC+' rating on Targus'
previous $150 million senior subordinated note offering. All
ratings are based on preliminary offering statements and are
subject to review upon final documentation. The outlook is
stable.
Under the revised transaction, Anaheim, California-based Targus
will have about $300 million of total consolidated debt
outstanding -- inclusive of the holding company's PIK note
issuance, and excluding operating leases -- upon closing of the
transaction.
Fenway Partners, the financial sponsor, will acquire Targus for
about $420 million, including fees and expenses. Proceeds from
the new credit facilities, equity contribution, and PIK note
issuance will be used to finance the acquisition of the company.
THERMA-WAVE INC: Issuing $10.4 Mil. Shares Via Private Placement
----------------------------------------------------------------
Therma-Wave, Inc. (NASDAQ:TWAV) has entered into definitive
agreements with two of its largest institutional shareholders for
the private sale of $10.4 million of convertible preferred stock
and warrants to purchase common stock. Therma-Wave expects to
close the transaction on or prior to Nov. 23, 2005, subject to
customary conditions. Therma-Wave intends to use the proceeds
from this transaction for general corporate purposes.
Under the terms of the financing, Therma-Wave will issue:
* an aggregate of 10,400 shares of Series B Convertible
Preferred Stock at a purchase price of $1,000 per share,
and
* warrants to purchase 1.56 million shares of common stock.
The Series B Convertible Preferred Stock:
* will be paid cash dividends quarterly at a rate of 6% per
annum and
* will be convertible into common stock at a conversion price
of $1.55 per share.
The warrants will expire in 2010 and are exercisable at a per
share price of $1.55.
Holders of the Series B Convertible Preferred Stock will have
certain rights including:
* the right to name two additional members to the Therma-Wave
Board of Directors,
* anti-dilution provisions, and
* other rights and provisions to which Therma-Wave will be
subject.
The holders of the Series B Convertible Preferred Stock have
agreed that for the lesser of a period of two years or for as long
as the Preferred Stock is outstanding, they will not engage in any
short sale transactions in Therma-Wave stock.
The purchasers of the Series B Convertible Preferred Stock are:
* North Run Capital, LP and
* Deephaven Capital Management LLC.
Needham & Company, LLC acted as placement agent for this Series B
Convertible Preferred Stock financing.
"We are pleased to receive this vote of confidence from two of our
largest shareholders. With the proceeds of this financing, we will
continue to advance our leading edge metrology products and
technology to the benefit of our customers worldwide," said Boris
Lipkin, President and CEO of Therma-Wave, Inc. "We look forward
to working with the new members of our Board of Directors to
maximize shareholder value for all of our shareholders," added
Papken Der Torossian, Therma-Wave's Chairman.
The shares being sold have not been registered under the
Securities Act of 1933, or any state securities laws, and will be
sold in a private transaction under Regulation D. Unless the
shares are registered, they may not be offered or sold in the
United States except pursuant to an exemption from the
registration requirements of the Securities Act and applicable
state laws. Therma-Wave is required to register the securities
for resale on a registration statement to be filed with the
Securities Exchange Commission within 60 days of the closing of
the transaction.
Since 1982, Therma-Wave, Inc. -- http://www.thermawave.com/-- has
been revolutionizing process control metrology systems through
innovative proprietary products and technologies. The company is a
worldwide leader in the development, manufacture, marketing and
service of process control metrology systems used in the
manufacture of semiconductors. Therma-Wave currently offers
leading-edge products to the semiconductor manufacturing industry
for the measurement of transparent and semi-transparent thin
films; for the measurement of critical dimensions and profile of
IC features; for the monitoring of ion implantation; and for the
integration of metrology into semiconductor processing systems.
* * *
As reported in the Troubled Company Reporter on July 07, 2005,
PricewaterhouseCoopers LLP raised substantial doubt about
Therma-Wave, Inc.'s ability to continue as a going concern after
it audited the company's financial statements for the year ended
April 3, 2005. The qualification was included in PwC's audit
report as a result of the Company's recurring net losses and
negative cash flow.
Material Weaknesses
The company's management identified two material weaknesses in its
controls over the preparation, review and timely analysis of its
consolidated financial statements in connection with its financial
closing process. Specifically:
(1) inter-company accounts between the Company's U.S.
operations and its branches and subsidiaries are not
reconciled; and
(2) the Company's customer service and support organization
expense allocation between selling, general and
administrative expense and cost of revenue is recorded in
consolidation without supporting documentation for such
entry.
Each of these control deficiencies could result in a misstatement
of account balances or disclosures that would result in a material
misstatement in the annual or interim financial statements that
would not be prevented or detected. Accordingly, management has
determined that each of these control deficiencies constitutes a
material weakness.
TITAN CRUISE: Wants Until January 31 to File Chapter 11 Plan
------------------------------------------------------------
Titan Cruise Lines and Ocean Jewel Casino & Entertainment, Inc.,
ask the U.S. Bankruptcy Court for the Middle District of Florida,
Tampa Division, for an extension of their time to file a chapter
11 plan. The Debtors say that an extension until Jan. 31, 2006,
is sufficient.
The Debtors say that their cases are not only large but also
involves complex secured financing transactions as well as
additional layer of unsecured debt through unrecorded maritime
liens. The Debtors obtained a true picture of the maritime liens
after the September 26 secured claims bar date.
Also, the Debtors want to determine the final amount of unsecured
claims that will be filed on the November 28 bar date. The
unsecured claims are expected to exceed $5 million in these cases.
In addition, the Debtors have focused their efforts on procuring
an adequate offer for the purchase of substantially all of their
assets. Titan Cruise and Ocean Jewel are in the process of
analyzing sale alternatives in order to maximize the value of
remaining assets to enhance creditors' recoveries.
Headquartered in Saint Petersburg, Florida, Titan Cruise Lines and
its subsidiary owns and operates an offshore casino gaming
operation. The Company and its subsidiary filed for chapter 11
protection on August 1, 2005 (Bankr. M.D. Fla. Case Nos. 05-15154
and 05-15188). Gregory M. McCoskey, Esq., at Glenn Rasmussen &
Fogarty, P.A., represents the Debtors in their restructuring
efforts. When the Debtors filed for protection from their
creditors, they estimated assets and debts between $10 million to
$50 million.
TRONOX WORLDWIDE: Fitch Places B+ Rating on $350MM Sr. Unsec. Debt
------------------------------------------------------------------
Fitch Ratings has initiated ratings on Tronox Worldwide LLC's and
Tronox Finance's $350 million senior unsecured debt at 'B+'.
At the same time, Fitch has assigned a rating to Tronox's senior
secured credit facility of 'BB' and assigned issuer default rating
of 'B'. Tronox Worldwide and Tronox Finance are co-issuers of the
senior unsecured notes. The Rating Outlook is Stable.
The ratings are supported by Tronox's market position,
geographical reach, and strong customer retention. Growth rate
projections for titanium dioxide are modest and tend to track
gross domestic product; however, growth rates vary by end-use
segment and region.
Fitch estimates growth in North America in 2006 to be close to 3%.
Emerging markets such as Latin America, Eastern Europe, and the
Asia-Pacific region are likely to grow at 2.5 % to 6% per year.
Therefore, Tronox is likely to realize more volume growth in
emerging markets. Fitch estimates overall sales growth for Tronox
in 2006 to be close to 3.5%.
The ratings incorporate the poor financial results to date as well
as limited improvement going forward based on Fitch projections.
Tronox has experienced net losses of $127.6 million,
$92.7 million, and $97.3 million for the fiscal years ended
Dec. 31, 2004, 2003, and 2002, respectively. The debt levels are
expected to be modest at the close of the IPO at $550 million and
full availability under the $250 million revolver. Debt to EBITDA
is expected to be under 2.7 times at Dec. 31, 2005. Maintenance
capital expenditures are expected to be manageable over the near
term. Limiting the ratings is the negative free cash flow and
environmental liabilities.
The Stable Outlook reflects the likelihood that Tronox's near-term
financial performance should remain steady and debt levels should
remain steady and may decline somewhat as TiO2 business conditions
continue to improve. TiO2 prices are up year-over-year and demand
has been steadily rising. It is expected that supply constraints
are likely to keep the market tight during the first six to nine
months of 2006 and maybe longer. Producers may be able to push
prices higher depending on how strong demand is in 2006. Supply
should continue to remain tight with no major production additions
planned in the near-term. Margins are expected to strengthen as
price increases take effect and as the market fundamentals
strengthen.
Fitch remains moderately concerned about volatile energy costs and
the overall effect of high raw material prices on demand.
Tronox is one of the leading global producers and marketers of
titanium dioxide. Titanium dioxide is a white pigment used in a
wide range of products for its exceptional ability to impart
whiteness, brightness, and opacity. They are the world's third
largest producer and marketers of titanium dioxide based on
reported industry capacity by the leading titanium dioxide
producers and have an estimated 13% market share of the $9 billion
global market in 2004 based on reported industry sales. Their
high-performance pigment products are critical components of
everyday consumer applications, such as coatings, plastics, and
paper, as well as specialty products, such as inks, foods, and
cosmetics.
In addition to titanium dioxide, Tronox produces electrolytic
manganese dioxide, sodium chlorate, and boron-based and other
specialty chemicals. The company generated adjusted EBITDA of
$162.2 million on $1.3 billion in sales in 2004. The Americas
account for 47% of sales, Europe accounts for 32%, and the
Asia-Pacific region accounts for 21%.
TRUMP ENT: Appoints Dale Black as EVP and Chief Financial Officer
-----------------------------------------------------------------
Trump Entertainment Resorts, Inc. (NASDAQ NMS: TRMP) reported the
appointment of Dale Black to the position of Executive Vice
President and Chief Financial Officer, effective Nov. 17, 2005.
"We are pleased to have an executive with Dale's excellent
communication skills and financial acumen join the Trump
Entertainment Resorts senior management team," James B. Perry, the
Company's President and Chief Executive Officer, commented.
Black comes to Trump after 12 years at Argosy Gaming Company,
serving most recently as Senior Vice President and Chief Financial
Officer, a position he held since April 1998. A graduate of
Southern Illinois University, Black began his career with Arthur
Andersen, and remained with them until 1991. He served as
Corporate Controller for a national manufacturing company from
July 1991 until April 1993, when he joined Argosy as Vice
President and Corporate Controller.
Frank McCarthy will continue with the Company as its Executive
Vice President and Corporate Controller, effective Nov. 17, 2005.
Trump Entertainment Resorts, Inc. -- http://www.trumpcasinos.com/
-- is a leading gaming company that owns and operates four
properties. The company's assets include Trump Taj Mahal Casino
Resort and Trump Plaza Hotel and Casino, located on the Boardwalk
in Atlantic City, New Jersey, Trump Marina Hotel Casino, located
in Atlantic City's Marina District, and the Trump Casino Hotel, a
riverboat casino located in Gary, Indiana. Together, the
properties comprise approximately 371,300 square feet of gaming
space and 3,180 hotel rooms and suites. The company is the sole
vehicle through which Donald J. Trump, the company's Chairman and
largest stockholder, conducts gaming activities and strives to
provide customers with outstanding casino resort and entertainment
experiences consistent with the Donald J. Trump standard of
excellence. Trump Entertainment Resorts, Inc. is separate and
distinct from Mr. Trump's real estate and other holdings.
Headquartered in Atlantic City, New Jersey, Trump Hotels & Casino
Resorts, Inc., nka Trump Entertainment Resorts, Inc. --
http://www.thcrrecap.com/-- through its subsidiaries, owns and
operates four properties and manages one property under the Trump
brand name. The Company and its debtor-affiliates filed for
chapter 11 protection on Nov. 21, 2004 (Bankr. D. N.J. Case No.
04-46898 through 04-46925). Robert A. Klymman, Esq., Mark A.
Broude, Esq., John W. Weiss, Esq., at Latham & Watkins, LLP, and
Charles Stanziale, Jr., Esq., Jeffrey T. Testa, Esq., William N.
Stahl, Esq., at Schwartz, Tobia, Stanziale, Sedita & Campisano,
P.A., represent the Debtors in their successful chapter 11
restructuring. When the Debtors filed for protection from their
creditors, they listed more than $500 million in total assets and
more than $1 billion in total debts. The Court confirmed the
Debtors' Second Amended Plan of Reorganization on Apr. 5, 2005,
and the plan took effect on May 20, 2005.
* * *
As reported in the Troubled Company Reporter on Nov. 10, 2005,
Moody's Investors Service revised the outlook of Majestic Star
Casino, L.L.C. to developing following the announcement that it
will acquire Trump Entertainment Resorts Holdings, L.P.'s Gary,
Indiana riverboat casino for $253 million in cash, or about 8
times the casino property's latest twelve month EBITDA.
Concurrently, the ratings for both Majestic Star and Trump were
affirmed; Trump's rating outlook is stable. The acquisition is
expected to close by the end of 2005 and is subject to customary
approvals and consents.
These Trump ratings have been affirmed:
-- $200 million senior secured revolver due 2010 -- B2;
-- $150 million senior secured term loan due 2012 -- B2;
-- $150 million senior secured delayed draw term loan due
2012 -- B2;
-- $1.25 billion second lien senior secured notes due 2015 --
Caa1;
-- Speculative grade liquidity rating -- SGL-3; and
-- Corporate family rating -- B3.
UAL CORP: 56 Former Employees Hold $280,000 Allowed Unsec. Claims
-----------------------------------------------------------------
From 1995 until 2002, UAL Corporation and its debtor-affiliates
leased a facility at 12125 Day Street, in Moreno Valley,
California. Prior to the Petition Date, 56 former employees filed
a lawsuit against the Debtors and others in the Superior Court for
the State of California, County of Los Angeles, entitled
Rosengarten, et al., v. United Airlines, et al., No. BC 258705.
The Rosengarten Complaint alleged that from 1995 to 2002, the Day
Street Office contained high levels of hydrogen sulfide, which
caused the Plaintiffs various eye injuries while they were
working for the Debtors, and other ailments like headaches, eye
irritation, short-term memory loss, conjunctivitis and
respiratory problems.
The Plaintiffs sought:
* unspecified damages from the Debtors and several other
defendants; and
* workers' compensation for the alleged injuries from the
California Workers' Compensation Fund.
Some of the Plaintiffs' workers' compensation cases have been
resolved, but others remain pending. The Debtors are attempting
to resolve the Plaintiffs' workers' compensation cases in the
ordinary course of business.
On April 24, 2003, the Plaintiffs filed Claim No. 16967 seeking
in excess of $10,000,000. Later, the Plaintiffs filed Claim No.
41489 asserting an undisclosed amount of liability.
On July 27, 2005, the Debtors objected to the Plaintiffs' Claims.
The Court sustained the Debtors' objection to Claim No. 41489 and
set a schedule for summary judgment briefing on the fraudulent
concealment aspect of Claim No. 16967.
On July 29, 2005, the Debtors, the Plaintiffs and other
defendants participated in mediation in Los Angeles, California.
As a result of the mediation, the parties agreed to terms
resolving the Complaint as it related to the Debtors.
Pursuant to the Settlement, the Plaintiffs will:
a) reduce their pending general unsecured claims to $5,000 per
Plaintiff, resulting to an aggregate of $280,000 for all 56
Plaintiffs;
b) withdraw any additional claims with prejudice;
c) waive any further claim, except workers' compensation cases
that are currently pending; and
d) dismiss the Complaint against the Debtors with prejudice.
The Debtors, in turn, promise not to offset funds the Plaintiffs
may receive from third parties to reduce the Debtors' liability.
Michael B. Slade, Esq., at Kirkland & Ellis, in Chicago,
Illinois, asserts that the Court should approve the Stipulation
as reasonable in light of the value provided to the Debtors. The
Settlement allows the Debtors to avoid potentially protracted
litigation, with costs that could exceed the value of the alleged
preferences. The Stipulation further maximizes the value of the
Debtors' estates by minimizing litigation costs and the
uncertainty of the outcome of the underlying preference action
and by expediting the administration of the Debtors' estates.
Headquartered in Chicago, Illinois, UAL Corporation --
http://www.united.com/-- through United Air Lines, Inc., is the
holding company for United Airlines -- the world's second largest
air carrier. The Company filed for chapter 11 protection on
December 9, 2002 (Bankr. N.D. Ill. Case No. 02-48191). James H.M.
Sprayregen, Esq., Marc Kieselstein, Esq., David R. Seligman, Esq.,
and Steven R. Kotarba, Esq., at Kirkland & Ellis, represent the
Debtors in their restructuring efforts. When the Debtors filed
for protection from their creditors, they listed $24,190,000,000
in assets and $22,787,000,000 in debts. (United Airlines
Bankruptcy News, Issue No. 107; Bankruptcy Creditors' Service,
Inc., 215/945-7000)
URANIUM RESOURCES: Balance Sheet Upside-Down by $16MM at Sept. 30
-----------------------------------------------------------------
Uranium Resources, Inc., (OTCBB:URIX) reported a $$2,018,000 net
loss for the three months ended Sept. 30, 2005, compared to a
$4,494,000 net loss of for the corresponding period of 2004.
During the first nine months of 2005, the Company incurred a
$14,458,000 net loss compared to a $14,159,000 net loss for the
corresponding period of 2004.
The Company's balance sheet showed assets of $19,560,169 at Sept.
30, 2005, and liabilities totaling $3,395,445, resulting in a
stockholders' deficit of $16,164,724. At Sept. 30, 2005, the
Company had accumulated deficit of $90,406,534.
Projected Cash Requirements
Uranium Resources anticipates to need cash of approximately $21.7
million for the fourth quarter of 2005 and the first six months of
2006. The cash will come from cash on hand at Sept. 30, 2005 of
$10.1 million, sales from production at the Company's Vasquez
facility of $9.2 million and sales under existing spot contracts
of $3.1 million from production at its Kingsville Dome facility.
The Company allocates the $21.7 million:
-- $9 million will be used for ongoing Vasquez production,
development and related activities (which includes ongoing
financial surety requirements of $1.2 million required in
the fourth quarter of the year);
-- $6.9 million for pre-production and development and
production activities to start-up production at Kingsville
Dome;
-- $1.2 million for other equipment and South Texas working
capital;
-- $630,000 for ongoing groundwater restoration activities at
the Kingsville Dome and Rosita projects;
-- $930,000 for land acquisition and holding costs for the
Texas and New Mexico properties; and
-- $3 million for general and administrative and other
working capital costs.
New Vice President for Exploration
William M. McKnight, Jr. has rejoined Uranium Resources as Vice
President - Exploration. Mr. McKnight will be responsible for
exploration and land acquisitions. Mr. McKnight was one of the
founders of the Company and served as Sr. Vice President -
Operations and Chief Operating Officer from 1978 to 1997. He also
served as a director of the Company until 1994.
Kingsville and Rosita Property
Uranium Resources continues working towards the completion of
Production Area Authorization #3 at its Kingsville Dome project,
which is expected to be completed by year-end with production
commencing in the second quarter of 2006. Prior to 1999 the
Company produced about 3.5 million pounds of uranium for the
Kingsville Dome property. Activities are currently underway to
upgrade the Kingsville processing facility to allow the processing
of the additional Kingsville Dome production.
In addition, the Company has identified additional areas at its
currently idle but fully licensed Rosita property containing
mineralized uranium material and continues in its plan to acquire
known uranium deposits within the South Texas uranium trend.
Prior to 1999 the Company produced about 2.6 million pounds of
uranium for the Rosita property. It has recently acquired 750
acres near the Rosita property that the Company believes contains
mineralized uranium material. The Company plans to upgrade and
restart the Rosita facility to process these materials.
Going Concern Doubt
Hein & Associates LLP expressed substantial doubt about Uranium
Resources' ability to continue as a going concern after it audited
the Company's financial statements for the years ended Dec. 31,
2004 and 2003. The auditing firm pointed to the Company's
recurring losses due to depressed uranium prices and its need to
generate profitable operations, or raise additional capital, to
fund future working capital requirements.
About Uranium Resources
Dallas, Texas-based Uranium Resources Inc. --
http://www.uraniumresources.com/-- specializes in in-situ
solution mining and holds mineralized uranium materials in South
Texas and New Mexico. Since 1988, the Company has produced about
6.1 million pounds of uranium from two South Texas properties, 3.5
million pounds from Kingsville Dome and 2.6 million pounds from
Rosita. Additional mineralized uranium materials exist at the
Kingsville Dome and Rosita properties. In 1999, the Company shut
down its production due to depressed uranium prices, and from the
first quarter of 2000 until December 2004, it had no source of
revenue and had to rely on equity infusions to remain in business.
USG CORP: Futures Rep. Gets Court Nod to Hire M. Crames as Advisor
------------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware authorizes
the Future Claimants Representative in the chapter 11 cases of USG
Corporation and its debtor-affiliates, Dean M. Trafelet, to retain
Michael J. Crames, Esq., of Peter J. Solomon, L.P., as his
advisor.
Mr. Crames will be paid at $795 per hour, subject to any
reasonable and customary annual increases commencing in January
2006, plus reimbursement of all necessary expenses incurred in
connection with his representation of the Futures Representative.
The authorized compensation and reimbursement payments will be
entitled to priority as administrative expenses and will be
entitled to the benefits of any "carve outs" for professionals'
fees and expenses in effect of the Debtors' cases.
Headquartered in Chicago, Illinois, USG Corporation --
http://www.usg.com/-- through its subsidiaries, is a leading
manufacturer and distributor of building materials producing a
wide range of products for use in new residential, new
nonresidential and repair and remodel construction, as well as
products used in certain industrial processes. The Company filed
for chapter 11 protection on June 25, 2001 (Bankr. Del. Case No.
01-02094). David G. Heiman, Esq., and Paul E. Harner, Esq., at
Jones Day represent the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $3,252,000,000 in assets and $2,739,000,000 in debts. (USG
Bankruptcy News, Issue No. 98; Bankruptcy Creditors' Service,
Inc., 215/945-7000)
USG CORP: Wants Adversary Case vs. PI Panel & Trafelet Continued
----------------------------------------------------------------
Paul N. Heath, Esq., at Richards, Layton & Finger, P.A., in
Wilmington, Delaware, tells the U.S. Bankruptcy Court for
the District of Delaware that USG Corporation and its
debtor-affiliates' efforts to move their bankruptcy forward
have consistently been premised on their view that, before a
meaningful plan of reorganization can be filed, the parties need
direction from both the United States District Court for the
District of Delaware and the Bankruptcy Court with respect to:
(i) the estimation of United States Gypsum's asbestos
liabilities; and
(ii) resolution of the corporate structure issues about which
the various constituencies strongly disagree.
Mr. Heath says that the parties need the Courts' direction on the
two issues because they are simply too far apart to make any
meaningful progress towards settlement and ultimate agreement on
a plan.
"Attempting to put a reorganization plan together without first
having those issues decided would do nothing more than put the
parties at war over a pointless 'placeholder' plan, driving the
parties further apart and resulting in further delays in any
progress towards the resolution of [the Debtors'] bankruptcy
proceedings," Mr. Heath asserts.
Furthermore, applicable rules provide that the Adversary
Proceeding commenced by the Asbestos Personal Injury Committee
and Dean M. Trafelet, the legal representative for the Debtors'
future asbestos personal injury claimants, may go forward without
notice to all creditors. Significantly, the causes of action
asserted in the Adversary Proceeding can only be brought
derivatively on U.S. Gypsum's behalf.
Mr. Heath points out that the Adversary Proceeding is not one
that can be brought on behalf of or against the individual
creditors, which is precisely why notice to the creditors is
unnecessary.
Mr. Heath states that the Adversary Proceeding seeks to resolve
conflicts surrounding the Debtors' past transactions and its
corporate structure. However, he contends, it is not an action
to address the broader issues raised by Section 524(g) under the
Bankruptcy Code.
While Section 524(g) specifically permits injunctions protecting
debtors and third parties who are merely alleged to be liable and
does not require a contribution by each protected party,
resolution of those issues should be left for another day. Mr.
Heath insists that just as the estimation proceedings must
proceed before a plan is filed, the Adversary Proceeding should
proceed also.
Therefore, to move towards a meaningful plan, the Debtor-
Plaintiffs ask Judge Fitzgerald to allow both estimation and the
Adversary Proceeding to move forward to full resolution before
requiring that a plan be proposed.
Headquartered in Chicago, Illinois, USG Corporation --
http://www.usg.com/-- through its subsidiaries, is a leading
manufacturer and distributor of building materials producing a
wide range of products for use in new residential, new
nonresidential and repair and remodel construction, as well as
products used in certain industrial processes. The Company filed
for chapter 11 protection on June 25, 2001 (Bankr. Del. Case No.
01-02094). David G. Heiman, Esq., and Paul E. Harner, Esq., at
Jones Day represent the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $3,252,000,000 in assets and $2,739,000,000 in debts. (USG
Bankruptcy News, Issue No. 99; Bankruptcy Creditors' Service,
Inc., 215/945-7000)
VELOCITA CORP: Claims Objection Bar Date Extended to April 30
-------------------------------------------------------------
The Honorable Donald H. Steckroth of the U.S. Bankruptcy Court for
the District of New Jersey extended, until April 30, 2006, the
period within which Anthony R. Calascibetta can object to proofs
of claim filed against the estates of Velocita Corp. and its
affiliates.
Mr. Calascibetta serves as the Liquidating Trustee for the Company
Liquidation Trust and the Affiliate Debtors Liquidation Trust
created pursuant to the Debtor's First Modified Plan of
Liquidation. He asked for the extension to secure more time to
complete the proper review and analysis of the proofs of claim and
determine whether objections are appropriate.
Velocita Corp., is in the business of building a nationwide
broadband fiber-optic network aimed at serving communications
carriers, internet service providers, data providers, television
and video providers, as well as corporate and government
customers. The Company, along with its debtor-affiliates, filed
for chapter 11 protection on May 30, 2002 (Bankr. N.J. Case No.
02-35895). Howard S. Greenberg, Esq., Morris S. Bauer, Esq., at
Ravin Greenberg PC and Gary T. Holtzer, Esq., at Weil, Gotshal &
Manges LLP represent the Debtors in their restructuring efforts.
A. Dennis Terrell, Esq., at Drinkle Biddle & Reath LLP represents
Anthony R. Calascibetta, the Liquidation Trustee. As of March 31,
2002, the Debtors listed $482,807,000 in total assets and
$827,000,000 in total debts. On July 21, 2003, Hon. Donald H.
Steckroth confirmed the Debtors' First Modified Plan of
Liquidation.
VERIDICOM INT'L: Incurs $1.6MM Net Loss in Quarter Ended Sept. 30
-----------------------------------------------------------------
Veridicom International, Inc., fka Alpha Virtual, Inc., reported a
net loss of $1,642,862 on $130,879 of revenues for the three
months ended Sept. 30, 2005, in contrast to a net loss of
$1,070,642 on $86,944 of revenues for the comparable period in
2004.
Revenues in the third quarter of 2005 primarily came from VKI
sales, a USB flash drive with finger print sensor. All other
revenues for the comparative periods are in respect of sales of
capacitive fingerprint sensors, computer peripherals and software
related to the use of the Company's fingerprint authentication
technology.
The Company's balance sheet showed $7,495,104 in total assets at
Sept. 30, 2005, and liabilities totaling $4,294,444. The Company
has a working capital deficit of $1,507,526 at Sept. 30, 2005, and
has accumulated deficit of $16,636,242.
Callable Notes
In February 2005, Veridicom completed the first of three rounds of
a private placement whereby it issued up to an aggregate of
$5,100,000 worth of 10% callable secured notes convertible into
shares of common stock, and warrants to purchase up to an
aggregate of 10.2 million shares of our common stock to certain
accredited investors. The first of three equal installments of
$1,700,000 was received in March 2005.
Subsequently in April 2005, the Company completed the second round
of the private placement resulting in aggregate proceeds amounting
to $1,700,000. The third closing of the private placement was
completed in August 2005.
As of Sept. 30, 2005, $1,420,000 of the aggregate proceeds were
received and $280,000 of the aggregate proceeds are receivable.
Since Oct. 1, 2005, the Company has been in default in making
repayments of principal and interest at the default rate of 15%
per annum on the callable secured notes.
Going Concern Doubt
AJ. Robbins, PC, expressed substantial doubt about Veridicom's
ability to continue as a going concern after it audited the
Company's financial statements for the year ended Dec. 31, 2004.
The auditing firm pointed to the Company's recurring losses from
operations.
About Veridicom
Veridicom International -- http://www.veridicom.com/-- designs,
develops and manufactures computer-based simulation systems for
training and decision support. These systems included both
hardware and software and are used to train personnel in the use
of various military and commercial equipment. Much of the
Company's simulator business was in the foreign defense industry.
The tightening of defense budgets worldwide, combined with the
continuing consolidation and competition in the defense industry,
negatively impacted the growth and profit opportunities for the
Company. As a result, in July 2000, the Company refocused its
business. In connection with the refocus, the Company sold its
assets related to its computer based simulation system line of
business to a developer and manufacturer of specialized defense
simulation products. The Company then commenced development of
commercial products in the area of Internet collaboration.
* Sheppard Mullin Names Rick Chessen as Washington Partner
----------------------------------------------------------
FCC Chair of the Digital Television Task Force and Associate
Bureau Chief of the Media Bureau Rick Chessen will join Sheppard,
Mullin, Richter & Hampton LLP in Washington, D.C. as a partner in
the Entertainment, Media and Communications practice group and the
firm's new communications practice.
With more than ten years' experience at the Federal Communications
Commission, Mr. Chessen was appointed to spearhead the FCC's
efforts regarding the transition to digital television. Mr.
Chessen was responsible for all legal, regulatory and technical
issues relating to the digital transition, including broadcaster
build-out, spectrum issues, consumer electronics and digital
rights management.
At Sheppard Mullin, Mr. Chessen is reunited with former FCC
colleague W. Kenneth Ferree, who joined the firm last month to
lead the firm's communications practice. Mr. Ferree previously
served as Chief of the Media Bureau at the FCC.
Prior to joining the Media Bureau, Mr. Chessen held legal and
regulatory positions at the FCC's Mass Media Bureau and Cable
Services Bureau, and with commissioner Gloria Tristani. Mr.
Chessen previously practiced at Sonnenschein, Nath & Rosenthal in
Chicago and Washington, D.C., specializing in media law.
"Rick's depth and breadth of experience at the FCC is a perfect
fit for our growing communications practice," said Guy Halgren,
managing partner of the firm. "We will be looking to Rick to
build on our existing strengths in entertainment and media law by
bolstering the firm's FCC capabilities."
"I enjoyed working with Ken at the FCC and look forward to growing
the communications practice with him at Sheppard Mullin," Mr.
Chessen said. "I am impressed with the firm's entertainment group
and am excited to expand its communications law capabilities."
Bob Darwell and Marty Katz, co-chairs of the firm's Entertainment,
Media and Communications practice, are delighted by Chessen's
addition to the group. "We are looking for opportunities to
expand our practice and Rick brings substantial FCC experience to
the group's growing communications specialty," said Mr. Darwell.
Mr. Katz agreed, "Rick is a fantastic addition to our FCC
practice. Both Rick and Ken Ferree reflect our commitment to join
with 'A' quality lawyers."
"Another win for the D.C. office," said Edward Schiff, managing
partner of the firm's Washington, D.C. office. "In addition to
the FCC group, Rick's specialization dovetails well with the
office's M&A corporate practice and its regulatory focus in the
Government Contracts, Antitrust and Labor & Employment practice
areas."
Mr. Chessen earned his law degree, cum laude, from Harvard Law
School in 1986 and graduated from University of Wisconsin with a
BA in 1983.
About Sheppard, Mullin, Richter & Hampton LLP
Sheppard, Mullin, Richter & Hampton LLP --
http://www.sheppardmullin.com/-- is a full service AmLaw 100 firm
with more than 450 attorneys in nine offices located throughout
California and in New York and Washington, D.C. The firm's
California offices are located in Los Angeles, San Francisco,
Santa Barbara, Century City, Orange County, Del Mar Heights and
San Diego. Sheppard Mullin provides legal expertise and counsel
to U.S. and international clients in a wide range of practice
areas, including Antitrust, Corporate and Securities;
Entertainment, Media and Communications; Finance and Bankruptcy;
Government Contracts; Intellectual Property; Labor and Employment;
Litigation; Real Estate/Land Use; Tax/Employee Benefits/Trusts &
Estates; and White Collar Defense. The firm was founded in 1927.
* Upcoming Meetings, Conferences and Seminars
---------------------------------------------
November 28-29, 2005
BEARD GROUP & RENAISSANCE AMERICAN CONFERENCES
Twelfth Annual Conference on Distressed Investing
Maximizing Profits in the Distressed Debt Market
The Essex House, New York, New York
Contact: 903-595-3800; 1-800-726-2524;
http://www.renaissanceamerican.com/
November 29, 2005
TURNAROUND MANAGEMENT ASSOCIATION
State of Banking 2006 and Beyond - Economy, Climate for
Turnaround Industry, Banking Relationships
Tournament Players Club at Jasna Polana, Princeton,
New Jersey
Contact: 312-578-6900;
http://www.turnaround.org/
November 29, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Orlando Luncheon
Citrus Club, Orlando, Florida
Contact: http://www.turnaround.org/
December 1, 2005
AMERICAN BANKRUPTCY INSTITUTE
Bankruptcy Fundamentals: Nuts & Bolts for Young
Practitioners
Hyatt Grand Champions Resort, Indian Wells, California
Contact: 1-703-739-0800; http://www.abiworld.org/
December 1-3, 2005
AMERICAN BANKRUPTCY INSTITUTE
Winter Leadership Conference
Hyatt Grand Champions Resort, Indian Wells, California
Contact: 1-703-739-0800; http://www.abiworld.org/
December 2, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Holiday Open House
Merchandise Mart, Chicago, Illinois
Contact: 815-469-2935 or http://www.turnaround.org/
December 5-6, 2005
MEALEYS PUBLICATIONS
Asbestos Bankruptcy Conference
Ritz-Carlton, Battery Park, New York, New York
Contact: http://www.mealeys.com/
December 5, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Carolinas Holiday Reception
The Park Hotel, Charlotte, North Carolina
Contact: 704-926-0359 or http://www.turnaround.org/
December 6, 2005
TURNAROUND MANAGEMENT ASSOCIATION
TMA/UVANY Holiday Party
Shanghai Reds, Buffalo, New York
Contact: 716-440-6615 or http://www.turnaround.org/
December 6, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Holiday Networking with CFA
Pyramid Club, Philadelphia, Pennslyvania
Contact: 215-657-5551 or http://www.turnaround.org/
December 7, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Evening Drinks
GE Commercial Finance, Sydney, Australia
Contact: 9299-8477 or http://www.turnaround.org/
December 8, 2005
TURNAROUND MANAGEMENT ASSOCIATION
NJTMA Networking Breakfast
Woodbridge Hilton, Iselin, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
December 8, 2005
TURNAROUND MANAGEMENT ASSOCIATION
TMA/CFA Holiday Party
J.W. Marriott, Atlanta, Georgia
Contact: 678-795-8103 or http://www.turnaround.org/
December 8, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Holiday Gathering & Help for the Needy *FREE to Members*
Mack Hall at Hofstra University, Hempstead, New York
Contact: 516-465-2356; http://www.turnaround.org/
December 8, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Annual Board of Directors Meeting
Rochester, New York
Contact: 716-440-6615; http://www.turnaround.org/
December 12-13, 2005
PRACTISING LAW INSTITUTE
Understanding the Basics of Bankruptcy & Reorganization
New York, New York
Contact: http://www.pli.edu/
December 14, 2005
TURNAROUND MANAGEMENT ASSOCIATION
Breakfast Meeting
Marriott Hotel, Tyson's Corner, Virginia
Contact: 703-912-3309; http://www.turnaround.org/
January 5, 2006
TURNAROUND MANAGEMENT ASSOCIATION
NJTMA Holiday Party
Iberia Tavern & Restaurant, Newark, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
January 14, 2005
CEB
Drafting & Negotiating Office Leases
San Francisco, California
Contact: customer_service@ceb.ucop.edu or
1-800-232-3444
January 14, 2005
CEB
Real Property Financing
Los Angeles, California
Contact: customer_service@ceb.ucop.edu or
1-800-232-3444
January 21, 2005
CEB
Drafting & Negotiating Office Leases
Sacramento, California
Contact: customer_service@ceb.ucop.edu or
1-800-232-3444
January 21, 2005
CEB
Drafting & Negotiating Office Leases
San Diego, California
Contact: customer_service@ceb.ucop.edu or
1-800-232-3444
January 21, 2005
CEB
Real Property Financing
Sacramento, California
Contact: customer_service@ceb.ucop.edu or
1-800-232-3444
January 21, 2005
CEB
Real Property Financing
San Diego, California
Contact: customer_service@ceb.ucop.edu or
1-800-232-3444
January 26, 2006
TURNAROUND MANAGEMENT ASSOCIATION
PowerPlay - TMA Night at the Thrashers
Philips Arena, Atlanta, Georgia
Contact: 678-795-8103 or http://www.turnaround.org/
January 28, 2005
CEB
Drafting & Negotiating Office Leases
Anaheim, California
Contact: customer_service@ceb.ucop.edu or
1-800-232-3444
January 28, 2005
CEB
Drafting & Negotiating Office Leases
Santa Clara, California
Contact: customer_service@ceb.ucop.edu or
1-800-232-3444
January 28, 2005
CEB
Real Property Financing
Anaheim, California
Contact: customer_service@ceb.ucop.edu or
1-800-232-3444
January 28, 2005
CEB
Real Property Financing
Santa Clara, California
Contact: customer_service@ceb.ucop.edu or
1-800-232-3444
January 26-28, 2006
AMERICAN BANKRUPTCY INSTITUTE
Rocky Mountain Bankruptcy Conference
Westin Tabor Center, Denver, Colorado
Contact: 1-703-739-0800; http://www.abiworld.org/
February 9-10, 2006
AMERICAN BANKRUPTCY INSTITUTE
International Insolvency Symposium
Eden Roc, Miami, Florida
Contact: 1-703-739-0800; http://www.abiworld.org/
February 27-28, 2006
PRACTISING LAW INSTITUTE
8th Annual Real Estate Tax Forum
New York, New York
Contact: http://www.pli.edu/
March 2-3, 2006
ASSOCIATION OF INSOLVENCY & RESTRUCTURING ADVISORS
Legal and Financial Perspectives on Business Valuations &
Restructuring (VALCON)
Four Seasons Hotel, Las Vegas, Nevada
Contact: http://www.airacira.org/
March 2-5, 2006
NATIONAL ASSOCIATION OF BANKRUPTCY TRUSTEES
2006 NABT Spring Seminar
Sheraton Crescent Hotel, Phoenix, Arizona
Contact: http://www.pli.edu/
March 4-6, 2006
NORTON INSTITUTES ON BANKRUPTCY LAW
Bankruptcy Law Institute
Marriott, Park City, Utah
Contact: 770-535-7722 or
http://www2.nortoninstitutes.org/
March 9, 2006
AMERICAN BANKRUPTCY INSTITUTE
Nuts & Bolts for Young Practitioners
Century Plaza, Los Angeles, California
Contact: 1-703-739-0800; http://www.abiworld.org/
March 10, 2006
AMERICAN BANKRUPTCY INSTITUTE
Bankruptcy Battleground West
Century Plaza, Los Angeles, California
Contact: 1-703-739-0800; http://www.abiworld.org/
March 22-25, 2006
TURNAROUND MANAGEMENT ASSOCIATION
TMA Spring Conference
JW Marriott Desert Ridge, Phoenix, Arizona
Contact: http://www.turnaround.org/
March 30-31, 2006
PRACTISING LAW INSTITUTE
Commercial Real Estate Financing: What Borrowers &
Lenders Need to Know Now
Chicago, Illinois
Contact: http://www.pli.edu/
March 30 - April 1, 2006
AMERICAN LAW INSTITUTE - AMERICAN BAR ASSOCIATION
Partnerships, LLCs, and LLPs: Uniform Acts, Taxation,
Drafting, Securities, and Bankruptcy
Scottsdale, Arizona
Contact: 1-800-CLE-NEWS; http://www.ali-aba.org/
April 1-4, 2006
NORTON INSTITUTES ON BANKRUPTCY LAW
Bankruptcy Law Institute
The Flamingo, Las Vegas, Nevada
Contact: 770-535-7722 or
http://www2.nortoninstitutes.org/
April 5-8, 2006
MEALEYS PUBLICATIONS
Insurance Insolvency and Reinsurance Roundtable
Fairmont Scottsdale Princess, Scottsdale, Arizona
Contact: http://www.mealeys.com/
April 6-7, 2006
BEARD GROUP & RENAISSANCE AMERICAN CONFERENCES
The Seventh Annual Conference on Healthcare Transactions
Successful Strategies for Mergers, Acquisitions,
Divestitures, and Restructurings
The Millennium Knickerbocker Hotel, Chicago,
Illinois
Contact: 903-595-3800; 1-800-726-2524;
http://www.renaissanceamerican.com/
April 18-22, 2006
AMERICAN BANKRUPTCY INSTITUTE
Annual Spring Meeting
JW Marriott, Washington, D.C.
Contact: 1-703-739-0800; http://www.abiworld.org/
April 19, 2006
PRACTISING LAW INSTITUTE
Residential Real Estate Contracts & Closings
New York, New York
Contact: http://www.pli.edu/
May 4-6, 2006
AMERICAN LAW INSTITUTE - AMERICAN BAR ASSOCIATION
Fundamentals of Bankruptcy Law
Chicago, Illinois
Contact: 1-800-CLE-NEWS; http://www.ali-aba.org/
May 8, 2006
AMERICAN BANKRUPTCY INSTITUTE
NYC Bankruptcy Conference
Millennium Broadway, New York, New York
Contact: 1-703-739-0800; http://www.abiworld.org/
May 18-19, 2006
BEARD GROUP & RENAISSANCE AMERICAN CONFERENCES
Third Annual Conference on Distressed Investing Europe
Maximizing Profits in the European Distressed Debt Market
Le Meridien Piccadilly Hotel, London, UK
Contact: 903-595-3800; 1-800-726-2524;
http://www.renaissanceamerican.com/
May 22, 2006
TURNAROUND MANAGEMENT ASSOCIATION
LI TMA Annual Golf Outing
Indian Hills Golf Club, Long Island, New York
Contact: 631-251-6296 or http://www.turnaround.org/
June 7-10, 2006
ASSOCIATION OF INSOLVENCY & RESTRUCTURING ADVISORS
22nd Annual Bankruptcy & Restructuring Conference
Grand Hyatt, Seattle, Washington
Contact: http://www.airacira.org/
June 15-18, 2006
AMERICAN BANKRUPTCY INSTITUTE
Central States Bankruptcy Workshop
Grand Traverse Resort, Traverse City, Michigan
Contact: 1-703-739-0800; http://www.abiworld.org/
June 21-23, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Global Educational Symposium
Hyatt Regency, Chicago, Illinois
Contact: http://www.turnaround.org/
June 22-23, 2006
BEARD GROUP & RENAISSANCE AMERICAN CONFERENCES
Ninth Annual Conference on Corporate Reorganizations
Successful Strategies for Restructuring Troubled
Companies
The Millennium Knickerbocker Hotel, Chicago,
Illinois
Contact: 903-595-3800; 1-800-726-2524;
http://www.renaissanceamerican.com/
June 29 - July 2, 2006
NORTON INSTITUTES ON BANKRUPTCY LAW
Bankruptcy Law Institute
Jackson Lake Lodge, Jackson Hole, Wyoming
Contact: 770-535-7722 or
http://www2.nortoninstitutes.org/
July 13-16, 2006
AMERICAN BANKRUPTCY INSTITUTE
Northeast Bankruptcy Conference
Newport Marriott, Newport, Rhode Island
Contact: 1-703-739-0800; http://www.abiworld.org/
July 26-29, 2006
AMERICAN BANKRUPTCY INSTITUTE
Southeast Bankruptcy Workshop
The Ritz Carlton Amelia Island, Amelia Island, Florida
Contact: 1-703-739-0800; http://www.abiworld.org/
September 7-9, 2006
AMERICAN BANKRUPTCY INSTITUTE
Southwest Bankruptcy Conference
Wynn Las Vegas, Las Vegas, Nevada
Contact: 1-703-739-0800; http://www.abiworld.org/
September 17-24, 2006
NATIONAL ASSOCIATION OF BANKRUPTCY TRUSTEES
Optional Alaska Cruise
Seattle, Washington
Contact: 800-929-3598 or http://www.nabt.com/
October 11-14, 2006
TURNAROUND MANAGEMENT ASSOCIATION
2006 Annual Conference
Milleridge Cottage, Long Island, New York
Contact: 312-578-6900; http://www.turnaround.org/
October 25-28, 2006
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
National Conference of Bankruptcy Judges
New Orleans, Louisiana
Contact: http://www.ncbj.org/
November 30-December 2, 2006
AMERICAN BANKRUPTCY INSTITUTE
Winter Leadership Conference
Hyatt Regency at Gainey Ranch, Scottsdale, Arizona
Contact: 1-703-739-0800; http://www.abiworld.org/
February 2007
AMERICAN BANKRUPTCY INSTITUTE
International Insolvency Symposium
San Juan, Puerto Rico
Contact: 1-703-739-0800; http://www.abiworld.org/
April 11-15, 2007
AMERICAN BANKRUPTCY INSTITUTE
ABI Annual Spring Meeting
J.W. Marriott, Washington, DC
Contact: 1-703-739-0800; http://www.abiworld.org/
March 29-31, 2007
ALI-ABA
Chapter 11 Business Reorganizations
Scottsdale, Arizona
Contact: 1-800-CLE-NEWS; http://www.ali-aba.org/
June 6-9, 2007
ASSOCIATION OF INSOLVENCY & RESTRUCTURING ADVISORS
23rd Annual Bankruptcy & Restructuring Conference
Westin River North, Chicago, Illinois
Contact: http://www.airacira.org/
October 10-13, 2007
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
National Conference of Bankruptcy Judges
Orlando, Florida
Contact: http://www.ncbj.org/
October 22-25, 2007
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
Marriott, New Orleans, Louisiana
Contact: 312-578-6900; http://www.turnaround.org/
December 6-8, 2007
AMERICAN BANKRUPTCY INSTITUTE
Winter Leadership Conference
Westin Mission Hills Resort, Rancho Mirage, California
Contact: 1-703-739-0800; http://www.abiworld.org/
March 25-29, 2008
TURNAROUND MANAGEMENT ASSOCIATION
TMA Spring Conference
Ritz Carlton Grande Lakes, Orlando, Florida
Contact: http://www.turnaround.org/
September 24-27, 2008
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
National Conference of Bankruptcy Judges
Scottsdale, Arizona
Contact: http://www.ncbj.org/
October 28-31, 2008
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
Marriott Copley Place, Boston, Massachusetts
Contact: 312-578-6900; http://www.turnaround.org/
October 5-9, 2009
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
Marriott Desert Ridge, Phoenix, Arizona
Contact: 312-578-6900; http://www.turnaround.org/
2009 (TBA)
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
National Conference of Bankruptcy Judges
Las Vegas, Nevada
Contact: http://www.ncbj.org/
October 4-8, 2010
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
JW Marriott Grande Lakes, Orlando, Florida
Contact: http://www.turnaround.org/
2010 (TBA)
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
National Conference of Bankruptcy Judges
New Orleans, Louisiana
Contact: http://www.ncbj.org/
The Meetings, Conferences and Seminars column appears in the
Troubled Company Reporter each Wednesday. Submissions via e-mail
to conferences@bankrupt.com are encouraged.
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable. Those sources may not,
however, be complete or accurate. The Monday Bond Pricing table
is compiled on the Friday prior to publication. Prices reported
are not intended to reflect actual trades. Prices for actual
trades are probably different. Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind. It is likely that some entity
affiliated with a TCR editor holds some position in the issuers'
public debt and equity securities about which we report.
Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets. At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets. A company may establish reserves on its balance sheet for
liabilities that may never materialize. The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.
A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged. Send announcements to
conferences@bankrupt.com/
Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.
Monthly Operating Reports are summarized in every Saturday edition
of the TCR.
For copies of court documents filed in the District of Delaware,
please contact Vito at Parcels, Inc., at 302-658-9911. For
bankruptcy documents filed in cases pending outside the District
of Delaware, contact Ken Troubh at Nationwide Research &
Consulting at 207/791-2852.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter is a daily newsletter co-published by
Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania,
USA, and Beard Group, Inc., Frederick, Maryland USA. Yvonne L.
Metzler, Emi Rose S.R. Parcon, Rizande B. Delos Santos, Jazel P.
Laureno, Cherry A. Soriano-Baaclo, Marjorie C. Sabijon, Terence
Patrick F. Casquejo, Christian Q. Salta, Jason A. Nieva, Lucilo
Junior M. Pinili, Tara Marie A. Martin and Peter A. Chapman,
Editors.
Copyright 2005. All rights reserved. ISSN: 1520-9474.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers. Information contained
herein is obtained from sources believed to be reliable, but is
not guaranteed.
The TCR subscription rate is $675 for 6 months delivered via e-
mail. Additional e-mail subscriptions for members of the same firm
for the term of the initial subscription or balance thereof are
$25 each. For subscription information, contact Christopher Beard
at 240/629-3300.
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