/raid1/www/Hosts/bankrupt/TCR_Public/051128.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Monday, November 28, 2005, Vol. 9, No. 282
Headlines
ADELPHIA COMMS: Creditors Have Until Feb. 3 to Vote on Plan
AERWAV INTEGRATION: Panel Wants Chapter 11 Trustee Appointed
AGILENT TECHNOLOGIES: Moody's Affirms Ba2 Corporate Family Rating
AMERICAN LOCKER: Posts $539,318 Net Loss in Third Quarter
AMERIGAS PARTNERS: Reports Fiscal 2005 Results & Issues Guidance
AMSCAN HOLDINGS: Moody's Rates Planned $505 Mil. Facilities at B2
ANCHOR GLASS: Retired Employees Want Sec. 1114 Committee Created
ANCHOR GLASS: Moves to Reject Six Business Compensation Pacts
ANCHOR GLASS: Class Action Plaintiffs Want to Begin Rule 2004 Exam
ARMSTRONG WORLD: Court Approves EFP Floor Settlement Agreement
ASARCO LLC: U.S. Government Wants DIP Order Denied or Modified
ASARCO LLC: Wants to Assume Amber Glass Construction Pact
ASARCO LLC: Final Cash Collateral Hearing Set Today
ATA AIRLINES: Wants Court to Set Plan Solicitation Deadlines
ATA AIRLINES: Wants Midway Gate Deals With Southwest Approved
BEACON POWER: Terminates Arrangement Agreement with NxtPhase
BERTHEL GROWTH: Sept. 30 Balance Sheet Upside-Down by $6 Million
BOYDS COLLECTION: Hires Swidler Berlin as Bankruptcy Co-Counsel
BOYDS COLLECTION: Wants to Retain Deloitte & Touche as Auditors
BRAVO! FOODS: Posts $4.9 Million Net Loss in Qtr. Ended Sept. 30
CATHOLIC CHURCH: Litigants Balk at Spokane's Disclosure Statement
CATHOLIC CHURCH: Portland Wants Estimations Procedures Approved
CENTRAL WAYNE: Wants to Hire Gazes as Special Litigation Counsel
CHAMPIONSHIP AUTO: Posts $124,00 Net Loss in Qtr. Ended Sept. 30
CIRCLE GROUP: Posts $1 Million Net Loss in Third Quarter
CIRTRAN CORP: Reports Third Quarter 2005 Financial Results
CLYDESDALE CBO: Moody's Lifts $47 MM Class B Notes' Rating to Ba2
COOPER COMPANIES: Moody's Reviews $750 Million Debts' Ba3 Ratings
DELPHI CORP: Wants to Hire Wilmer Cutler as Special Counsel
DELPHI CORP: Wants to Hire Jones Lang as Real Estate Advisors
DELPHI CORP: BofA Wants Adequate Protection Under Aircraft Leases
DENALI CAPITAL: Moody's Withdraws Class B-2L Notes' Ba2 Rating
DIRECT INSITE: Balance Sheet Upside-Down by $2.97MM at Sept. 30
DIRECTED ELECTRONICS: Moody's Reviews B2 Credit Loan Rating
EMPIRE FINANCIAL: Earns $1.58 Million in Third Quarter 2005
FEDERAL-MOGUL: Court Approves $775M Amended DIP Credit Agreement
FEDERAL-MOGUL: Asbestos PD Committee Objects to U.K. Settlement
FORCE PROTECTION: Jaspers + Hall Raises Going Concern Doubt
FRESH CHOICE: Bankruptcy Court Confirms Joint Chapter 11 Plan
GLYCOGENESYS INC: Losses & Deficits Trigger Going Concern Doubt
GRAND EAGLE: Creditors Committee Settles Dispute With Viacom
HONEY CREEK: Can Use of Cash Collateral to Maintain Operations
IBSG INT'L: Earns $278K of Net Income in Third Quarter
ILINC COMMS: Posts $521,000 Net Loss in Quarter Ending Sept. 30
INDUSTRIAL ENTERPRISES: Financial Restatements Prompt Filing Delay
INLAND FIBER: Balance Sheet Upside-Down by $162 Mill. at Sept. 30
INSEQ CORPORATION: Reports Third Quarter Financial Results
INTEGRATED SECURITY: Sept. 30 Balance Sheet Upside-Down by $5 Mil.
ITRONICS INC: Sept. 30 Balance Sheet Upside-Down by $916,599
JORDAN INDUSTRIES: Sept. 30 Balance Sheet Upside-Down by $247 Mil.
KAIRE HOLDINGS: Sept. 30 Balance Sheet Upside-Down by $2 Million
MAFCO WORLDWIDE: Moody's Rates Proposed $125-Mil Facilities at B1
MASSEY ENERGY: Moody's Reviews $132 Million Sr. Notes' B1 Rating
MCI INC: 9 Directors Acquire 6,489 Shares of Common Stock
MIRANT CORP: PEPCO Wants Certs. Issued to Refinance $148M Bonds
MIRANT CORP: Inks Maryland Counties' Multi-Million Settlement Pact
MIRANT CORP: Asks Court to Compel Wilson to Comply with Rule 2019
NBO SYSTEMS: Financial Woes Prompt Going Concern Doubt
NORTHWEST AIRLINES: Owes $83 Million on Davey Terminal Bonds
NYLIM STRATFORD: Moody's Places Class C Notes' B1 Rating on Watch
O'SULLIVAN INDUSTRIES: Can Keep Existing Bank Accounts
OWENS CORNING: Establishes New Insurance Policy with Old Republic
PATRON SYSTEMS: Sept. 30 Balance Sheet Upside-Down by $345,194
RAVEN MOON: Posts $1.1 Mil. Net Loss in Quarter Ending Sept. 30
ROMACORP INC: Committee Wants to Hire Haynes & Boone as Counsel
ROMACORP INC: Look for Bankruptcy Schedules on December 6
REFCO INC: Wants Court to Okay Bid Procedures for FX Asset Sale
REFCO INC: Wants Court to Okay $3.15-Mil Break-Up Fee for FXCM
REFCO INC: Refco LLC Files Chapter 7 to Consummate Asset Sale
REFCO LLC: Voluntary Chapter 7 Case Summary
SAINT VINCENTS: More Claimants Want to Prosecute Malpractice Suits
SAINT VINCENTS: Stay Modified to Permit Decision on Merola's Plea
SECURECARE TECH: Sept. 30 Balance Sheet Upside-Down by $1.8 Mil.
SITESTAR CORP: Working Capital Deficit Fuels Going Concern Doubt
TECH DATA: Earns $23 Million in Third Quarter Ending Oct. 31
THERMA-WAVE: Incurs $4.1 Million Net Loss in Second Quarter
USN CORP: Sept. 30 Balance Sheet Upside-Down by $5.1 Million
VITAL LIVING: Equity Deficit Narrows to $18.7-Mil at Sept. 30
WESTPOINT STEVENS: Beal Bank Wants Payment of Fees & Expenses
WINDSOR WOODMONT: Asks Court for Final Decree Closing Bankr. Case
WINDSWEPT ENVIRONMENTAL: Posts $1.2 Mil. Net Loss in Third Quarter
WINN-DIXIE: Will Abandon Unsold Burdensome FF&E at Targeted Stores
WINSTAR COMMS: Clifford Chance Approved as Ch. 7 Trustee's Counsel
WORLDCOM INC: Eduardo Jordan Wants Stay Lifted to Pursue Damages
* BOND PRICING: For the week of Nov. 21 - Nov. 25, 2005
*********
ADELPHIA COMMS: Creditors Have Until Feb. 3 to Vote on Plan
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The U.S. Bankruptcy Court for the Southern District of New York
set Nov. 25, 2005, as the record date for purposes of determining
which creditors and equity interest holders are entitled to vote
on Adelphia Communications Corporation and its debtor-affiliates'
Fourth Amended Plan of Reorganization.
The Court approved the Debtors' Disclosure Statement on Wednesday,
Nov. 23.
The Debtors are now authorized to transmit the Disclosure
Statement to their creditors to solicit acceptances for their
plan.
Accordingly, Judge Gerber directs the ACOM Debtors to commence
distribution by Dec. 5, 2005, the Solicitation Packages to:
1. all persons or entities identified in the their Schedules
of Liabilities as holding liquidated, noncontingent, and
undisputed claims, in an amount greater than zero dollars,
excluding scheduled claims that have been (a) superseded by
a timely filed proof of claim, (b) disallowed or expunged,
or (c) paid in full;
2. all parties having filed timely claims as reflected on the
Official Claims Register as of the close of business on the
Record Date, and whose claims have not been disallowed or
expunged prior to the Solicitation Commencement Date; and
3. the registered holders of the ACOM Debtors' debt and equity
securities as of the Record Date, provided that except with
respect to transfers of their publicly held debt
securities, that the assignee of a transferred and assigned
claim will be entitled to receive the Solicitation Package
if the transfer and assignment has been noted on the
Court's docket and is effective pursuant to Rule 3001(e) of
the Federal Rules of Bankruptcy Procedure as of the close
of business on the Record Date.
Voting Deadline
All ballots and master ballots must be properly executed,
completed, and its original must be delivered to the Balloting
Agent to be actually received by no later than 4:00 p.m.
(prevailing New York Time) on Feb. 3, 2006.
Any ballot received after the Voting Deadline will not be
counted. However, the ACOM Debtors may grant one or more
extensions of the Voting Deadline for one or more creditors or
equity interest holders, one or more Voting Classes, or one or
more Debtor Groups under the Plan.
With respect to holders of Bank Claims entitled to vote on the
Plan in:
* Classes FV-Bank (Frontiervision Bank Claims),
* P-Bank (Parnassos Bank Claims),
* TCIBank (Century-TCI Bank Claims),
* Century-Bank (Century Bank Claims),
* OLY-Bank (Olympus Bank Claims), and
* UCA-Bank (UCA Bank Claims),
the Court directs the administrative agent for each credit
facility to provide to the Balloting Agent a written list of the
names of the participants in its particular syndicate, including
the participants' contact information and voting amounts, no
later than December 2, 2005.
Alta Claims Classification
The Court makes it clear that while Alta Communications, VII,
L.P.; Alta VII Associates, LLC; Harbourvest Partners V Direct
Fund L.P.; C. Philip Rainwater; Washington & Congress Capital
Partners, L.P.; and Triumph II Investors, L.P.; will be entitled
to vote their claims according to the Voting Procedures, the
classification of the Alta's claims for voting purposes will be
as agreed to by the ACOM Debtors and Alta or, in the absence of
the agreement, determined by the Court at the Confirmation
Hearing.
3018(a) Motions
If any claimant seeks to challenge the allowance of its claim for
voting purposes, the claimant is directed to serve on the ACOM
Debtors and file with the Court on or before the tenth day after
the later of:
* December 5, 2005, and
* the service of notice of an objection, if any, to the claim,
a motion for an order pursuant to Bankruptcy Rule 3018(a)
temporarily allowing the claim in a different amount for purposes
of voting to accept or reject the Plan.
The Court will consider all 3018(a) Motions at a hearing on
January 25, 2006, or as soon as counsel may be heard.
The hearing to consider confirmation of the Plan will commence at
9:45 a.m., prevailing New York Time, on February 22, 2006.
A full-text copy of the Court's order approving the Fourth
Amended Disclosure Statement is available for free at
http://ResearchArchives.com/t/s?325
A full-text copy of the Fourth Amended Disclosure Statement is
available for free at http://ResearchArchives.com/t/s?31b
A full-text copy of the Fourth Amended Plan of Reorganization is
available for free at http://ResearchArchives.com/t/s?31a
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.
116; Bankruptcy Creditors' Service, Inc., 215/945-7000)
AERWAV INTEGRATION: Panel Wants Chapter 11 Trustee Appointed
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The Official Committee of Unsecured Creditors of Aerwav
Integration Group, Inc., and its debtor-affiliates asks the U.S.
Bankruptcy Court for the District of New Jersey to appoint a
chapter 11 trustee in the Debtors' case. In the alternative, the
Committee wants the cases converted to chapter 7 liquidation
proceedings.
Ben H. Becker, Esq., at Becker Meisel, LLC, reminds the Court that
the Committee had served the Debtors with Rule 2004 subpoenas
seeking information related to the Debtors' business operations
and financial conditions. Understanding the myriad demands
involved in these cases, the Committee agreed to several
adjournments. The Committee has sought to communicate informally
and to cooperate with the Debtors to avoid imposing additional
administrative expenses to the estate.
According to Mr. Becker, the Debtors' failure to timely file their
monthly reports put the Committee in the dark with regards to
postpetition administrative expenses incurred. On a conference
call on September 30 discussing the validity of Armor Holdings
Inc.'s liens against the estate, the Committee learned for the
first time that $400,000 of administrative expenses have
accumulated.
The Committee and the Debtors conducted a telephone conference
call on Oct. 7 to discuss the magnitude of their postpetition
expenses. The Debtors disclosed that involuntary furlough on
operations resulted from the accumulation of payables and
insurance problems. Despite the Debtors' assurances that
operations are stabilizing and collections are picking up, the
Committee are still concerned that administrative costs have not
gone down.
On Oct. 14, the Debtors filed monthly reports for July 22 to
July 31 and for the month of August. However, the reports missed
including critical bank reconciliations, bank statements and check
registers.
Despite repeated promises and assurances, the Committee says, the
Debtors have not addressed the serious operating concerns of their
businesses and have not made progress to turnaround in any
meaningful way their financial affairs.
The Committee doubts that the current management team is capable
of preserving the going concern value of the estates.
Heaquartered in Pine Brook, New Jersey, Aerwav Integration Group,
Inc., fka ArmorGroup Integrated Systems dba Aerwav Integration
Services -- http://www.aerwavintegration.com/-- creates,
installs, monitors and customizes integrated electronic safety and
security systems. The Debtor, along with its affiliates, filed
for chapter 11 protection on July 22, 2005 (Bankr. D. N.J. Case
Nos. 05-33791 through 05-33794). Gerald H. Gline, Esq., and
Warren A. Usatine, Esq., at Cole, Schotz, Meisel, Forman &
Leonard, P.A., represent Aerwav. When the Debtors filed for
chapter 11 protection, they estimated below $50,000 in assets and
$1 million to $10 million in debts.
AGILENT TECHNOLOGIES: Moody's Affirms Ba2 Corporate Family Rating
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Moody's Investors Service affirmed the ratings of Agilent
Technologies, Inc. The ratings outlook is stable.
These ratings were affirmed:
* Corporate Family Rating of Ba2
* Speculative Grade Liquidity Rating of SGL-1
The affirmation reflects Agilent's short-term challenges
associated with a smaller asset base and somewhat higher debt
levels offset by expected longer-term benefits to the company's
franchise value as a result of operations in less volatile markets
following the company's planned repositioning. Consideration is
given to the company's more focused business strategy affording
increased growth opportunities in Agilent's core markets after the
disposition of the Semiconductor Products Group ("SPG") and memory
test assets. Proceeds from asset sales will be used to fund share
repurchases.
The Ba2 corporate family rating continues to reflect Agilent's
leading market shares across its core electronic and bio-
analytical test and measurement businesses. The rating
incorporates the enhanced operating performance associated with:
* the previous restructuring and consolidation efforts;
* strong liquidity position;
* sizeable free cash flow generation; and
* improved debt protection measures.
With the planned realignment of its global infrastructure
operations and associated cost savings, Moody's believes the
company will be better able to allocate capital resources more
effectively across its remaining core business units, which should
improve ROA measures going forward.
In August, Agilent announced it will spin-off its System-on-a-Chip
and memory test businesses (collectively 6% of total revenues)
into a new publicly traded company in fiscal year 2006. The
company also announced the sale of its joint venture equity stake
in Lumileds Lighting International, B.V. for $948.5 million and
divestiture of its Semiconductor Products Group for $2.7 billion.
The sale of SPG, which accounts for 25% of Agilent's revenues, is
expected to be completed in early December.
Over the next year, Agilent will implement restructuring
initiatives to reduce global infrastructure costs by $450 million
through the elimination of 1,300 jobs and 11 facilities primarily
associated with the SPG sale, and reduction of worldwide sales
offices.
In addition, Agilent's Board approved a $4.5 billion stock
repurchase program to return proceeds from the sales of its SPG
business and Lumileds equity stake to its shareholders. In
November, Agilent announced it was accelerating the stock buyback
via a modified "Dutch Auction" tender offer to buy up to 73
million of its common stock at a share price not greater than $37
and not less than $32 for total consideration of up $2.7 billion.
The tender offer, which expires on December 13, 2005, will be
subject to receipt of proceeds from the sale of SPG and the
Lumileds equity stake. Finally, in September, the company
redeemed all of its $1.15 billion convertible notes with $684
million in cash and $466 million in stock.
Following the divestitures, the company's business will be less
diversified with a smaller revenue base, which should decline by
roughly 25-30%. Going forward, the business profile will be
focused completely on the test and measurement market with the
company's Electronic Measurement business representing 68% of
total revenues.
Although this operating segment is relatively less volatile,
Agilent's business will become more interrelated to the entire
electronics cycle with very little counter-cyclical operations.
The rating also factors the $2.7 billion stock repurchase
scheduled for the first quarter of 2006. This represents a more
aggressive financial policy than in the past given the
considerable amount of cash exiting the company in a short period
of time.
In view of the $3.6 billion of sale proceeds expected over the
interim from the asset and equity stake dispositions combined with
existing cash balances of $2.3 billion and expectation of
significant free cash flow generation next year, Moody's expects
Agilent should have in excess of $3.0 billion of cash-on-hand at
fiscal yearend 2006. However, the large cash balance will be
offset by $1.5 billion of new debt, which the company expects to
incur as part of long-term financing for the stock tender.
Lastly, for the foreseeable future Agilent will need to divert
cash flow to fund its defined benefit pension plan as measured by
the projected benefit obligation. Contributions for the 9-month
period ending July 31, 2005 declined 36% to $73 million compared
to the same period in fiscal year 2004.
The company's financial performance has improved over the past
year despite a decline in revenues. In fiscal year 2005, Agilent
generated revenues of $6.9 billion ($5.1 billion sans SPG)
compared to $7.2 billion in fiscal year 2004 ($5.2 billion sans
SPG). Negative revenue growth was attributed to softening demand
in the mobile handset and semiconductor test markets (which
exhibited a rebound in the fourth quarter), and continued price
erosion in the wireless and electronics semiconductor components
business.
Excluding SPG, preliminary adjusted gross margin advanced to 49.1%
compared to 47.3% in fiscal year 2004. Preliminary adjusted
operating earnings increased 27% to $184 million (3.6% margin)
from $145 million (2.8% margin) in the prior year due to operating
expense reductions and cost savings from earlier rationalization
efforts. Preliminary unadjusted EBIT improved 8.4% to $516
million from $476 million and preliminary unadjusted EBIT to
interest expense was 15.6x compared to 13.2x in fiscal year 2004.
Preliminary unadjusted free cash flow was $700 million. The
company ended fiscal year 2005 with cash balances of $2.3 billion.
Moody's notes that pro forma for the divestitures and new debt
financing, Moody's expects:
* EBIT margins of roughly 12-15%;
* total debt to EBITDA under 2.0x;
* EBIT to interest expense of 7.0x; and
* free cash flow to total debt above 45%.
Agilent's rating outlook is stable, reflecting expectations of a
higher degree of consistency in operating performance in its
markets post the sale of SPG, which typically had limited earnings
visibility. Despite improved credit metrics, the rating is
restrained by flat year-over-year revenue growth in the Electronic
Measurement business, which will now represent the bulk of total
revenues. Moody's expectation that share repurchase activity will
be managed appropriately for the rating is also factored in the
stable outlook.
The rating or outlook could experience upward pressure as a result
of:
* evidence that the company can execute effectively and sustain
its current operating performance across business cycles with
current levels of research and development investment and
capital expenditures;
* demonstrated stability in gross and operating margins amid
above average revenue growth;
* realized synergies from infrastructure rationalization;
* consistent free cash flow generation; and
* stabilization in financial policies.
A downward revision in the rating or outlook could materialize
should Moody's witness an increase in business risk or a change in
Agilent's competitive position or performance versus peers, which
could indicate an increase in pricing pressure, margin pressure or
future investment. Additionally, the company could face downward
pressure if:
* anticipated cost savings are not realized;
* management deviates from its financial policy of maintaining
sufficient liquidity; or
* future cash acquisition spending and share repurchases exceed
amounts provided by the company's free cash flow.
Agilent's speculative grade liquidity rating of SGL-1 is largely
based on its approximate $2.3 billion in unrestricted cash and
cash equivalents and generation of free cash flow. Moody's
expects the company to maintain strong levels of free cash flow to
cover capital expenditures and working capital requirements.
Further supporting the company's overall liquidity is the fact
that Agilent has no covenant restrictions and has alternative
liquidity availability with an unencumbered asset base.
Headquartered in Palo Alto, California, Agilent Technologies, Inc.
is a diversified technology company serving the:
* communications,
* electronics,
* life sciences, and
* chemical analysis industries.
For the fiscal year ended October 31, 2005, net revenues were $5.1
billion (excluding SPG business). Approximately 64% of sales were
derived from electronic measurement, 27% from bio-analytical
measurement and 9% from semiconductor test solutions (sans SPG).
AMERICAN LOCKER: Posts $539,318 Net Loss in Third Quarter
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American Locker Group Incorporated (Nasdaq:ALGI) filed its
Quarterly Report on Form 10-Q for its fiscal quarter ended
Sept. 30, 2005. The operating results for the third quarter of
2005 reflect the first full quarter without revenues from the
company's long-term contract with the United States Postal Service
for polycarbonate and aluminum Cluster Box Units, which was not
renewed by USPS and expired on May 31, 2005. In addition, the
company recorded restructuring charges of $523,000 in the third
quarter of 2005.
In the third quarter of 2005, the company recorded consolidated
net sales of $6,612,149, a decrease from $18,074,076, or 63.4%,
over the third quarter of 2004. The company's consolidated net
sales for the nine months ended Sept. 30, 2005 were $24,758,791,
which represents a decline of 34.6% from the consolidated net
sales of $37,882,548 for the comparable period in 2004. The
decrease in net sales was attributable primarily to reduced volume
of plastic postal products sold after the termination of the
Company's CBU contract with USPS on May 31, 2005 and the existence
of a large one-time sale to USPS in the third quarter of 2004 of
approximately $7,000,000.
The company reported a net loss of $539,318 in the third quarter
of 2005 and a net loss of $6,611,876 for the nine months ended
Sept. 30, 2005, after a first quarter write-down of goodwill of
$6,155,204, as compared to net income of $1,826,751 and
$2,907,736, respectively, in the same periods of 2004.
"The Company is moving forward in the challenging implementation
of the restructuring plan adopted by the Board of Directors in May
of this year," Edward F. Ruttenberg, the Company's Chairman and
Chief Executive Officer, stated. "During the third quarter, the
Company centralized and relocated many financial reporting
functions and all administrative functions to the new headquarters
in Grapevine, Texas. The Company expects to realize reduced
selling, general and administrative expenses going forward as a
result of these measures."
Default
On March 18, 2005, the company received a notice of default and
reservation of rights letter from its lender regarding the
company's term loan as a result of the non-renewal of its aluminum
Cluster Box Units contract with the United States Postal Service.
To date, the company has made all scheduled payments on its term
loan and its outstanding mortgage loan. In addition, the lender
has verbally advised the company that its revolving line of credit
is not available. The company has no long-term capital
commitments or obligations, although this situation may require
re-evaluation upon receipt of the USPS drawing and design package
for the new 1118F CBU.
Lender Talks
As reported in the Troubled Company Reporter on Aug. 1, 2005,
the company is in discussions with its lender -- Manufacturers and
Traders Trust Company -- to restructure the company's term and
revolving debt with a new loan agreement to be in effect for
approximately one year, during which time the company expects to
seek a new lender in Texas, where the company will be relocating
its headquarters by the end of 2005.
The lender's initial proposal provides that the company:
(i) pay down the remaining balance of its term loan, which is
approximately $2,700,000, in 2005;
(ii) maintain its mortgage loan due in 2006, which has an
outstanding balance of approximately $2,300,000; and
(iii) have available a revolving line of credit of $1,000,000,
subject to terms and conditions to be negotiated.
The real property and building which secures the company's
mortgage loan have been appraised by the lender at a value of
approximately $3,000,000.
The company expects to have sufficient cash on hand to pay off its
term loan and further expects to be able to refinance its mortgage
loan with a new lender in Texas. If the company is unable to
restructure its term and revolving debt with its current lender or
to refinance its mortgage loan and obtain financing from a new
lender on terms acceptable to the company, the financial position
of the company would be materially adversely affected.
Headquartered in Grapevine, Texas, American Locker Group
Incorporated -- http://www.americanlocker.com/-- is an
engineering, assembling, manufacturing and marketing enterprise
engaged primarily in the sale of lockers. This includes coin,
key-only, and electronically controlled checking lockers and
related locks and plastic and aluminum centralized mail and parcel
distribution lockers.
AMERIGAS PARTNERS: Reports Fiscal 2005 Results & Issues Guidance
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AmeriGas Propane, Inc., general partner of AmeriGas Partners, L.P.
(NYSE:APU), reported results of $94.4 million for the fiscal year
ended Sept. 30, 2005, excluding the previously reported
$33.6 million loss on the early extinguishment of debt. This
compared to a $91.9 million net income for the previous fiscal
year.
Including the loss on the early extinguishment of debt of
$33.6 million net income was $60.8 million. Net income for the
fiscal year also includes a $7.1 million after-tax gain on the
sale of its 50% interest in a propane import terminal in Virginia,
as previously reported. Excluding the loss on the early
extinguishment of debt of $33.6 million, the Partnership's
earnings before interest expense, income taxes, depreciation and
amortization (EBITDA) were $249.5 million for the fiscal 2005
period compared to $255.9 million for the fiscal year 2004. EBITDA
including the loss on extinguishment of debt and the $9.1 million
pre-tax gain on the sale of the import terminal was $215.9
million.
"I am very proud of the performance of all of our employees,
especially considering the challenges we faced during fiscal 2005
of warmer weather, price-induced conservation and higher energy-
related operating expenses," Eugene V. N. Bissell, chief executive
officer of AmeriGas, said. "Assuming a return to normal weather
in fiscal 2006, we expect EBITDA in the range of $255 million to
$265 million."
For the twelve months ended Sept. 30, 2005, retail propane volumes
sold were 1.035 billion gallons, down slightly from 1.059 billion
gallons sold in the prior year principally due to warmer weather
and price-induced customer conservation partly offset by increased
volumes from acquisitions and internal growth.
Nationally, weather was 6.9% warmer than normal in 2005 compared
to weather that was 4.9% warmer than normal in the prior-year
period, according to the National Oceanic and Atmospheric
Administration. Revenues increased to $1.96 billion in fiscal
2005 from $1.78 billion in fiscal 2004 reflecting higher average
selling prices partially offset by lower retail volumes sold.
Total margin decreased $3.4 million principally as a result of
lower retail volumes sold. Operating and administrative expenses
increased primarily as a result of higher vehicle fuel and lease
expenses as well as increases in expenses for maintenance,
uncollectible accounts and general insurance.
For the fourth quarter of fiscal 2005, the Partnership recorded
a seasonal net loss of $28.4 million, compared with a loss of
$32.8 million, or $0.60 per limited partner unit, for the
prior-year period. Retail volumes sold in the quarter were
177.4 million gallons, slightly higher than the 175.5 million
gallons sold in the prior year quarter. EBITDA for the period
declined to $7.9 million from $8.6 million in last year's
quarter. Revenue for the quarter totaled $359.3 million versus
$312.9 million in the fiscal 2004 quarter principally due to
higher selling prices reflecting significantly higher propane
product costs.
AmeriGas Partners, L.P. (NYSE:APU) is the nation's largest retail
propane marketer, serving nearly 1.3 million customers from over
650 locations in 46 states. UGI Corporation (NYSE:UGI), through
subsidiaries, owns 44% of the Partnership and individual
unitholders own the remaining 56%.
* * *
As reported in the Troubled Company Reporter on Apr. 15, 2005,
AmeriGas Partners, L.P.'s $400 million senior notes due 2015,
issued jointly and severally with its special purpose financing
subsidiary Amerigas Finance Corp., are rated 'BB+' by Fitch
Ratings. An indirect subsidiary of UGI Corp. is the general
partner and 44% limited partner for APU, which, in turn, is a
master limited partnership for AmeriGas Propane, L.P., an
operating limited partnership. Proceeds from the new senior notes
were used to repurchase tendered 8.875% APU senior notes.
AMSCAN HOLDINGS: Moody's Rates Planned $505 Mil. Facilities at B2
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Moody's Investors Service assigned a B2 rating to the proposed
$505 million senior secured credit facilities to be launched by
Amscan Holdings, Inc. Proceeds will finance Amscan's acquisition
of Party City Corporation and the repayment of existing Amscan
senior secured debt. With the exception of the newly rated
facilities, Amscan's existing ratings remain on review for
possible downgrade pending the close of the acquisition. At that
time, Moody's expects to downgrade Amscan's corporate family
rating to B2, to lower its senior subordinated notes rating to
Caa1, and to withdraw existing senior secured ratings. The
ratings outlook is anticipated to be stable.
The prospective rating downgrade reflects the weakened financial
profile expected to result from the high-priced and majority debt-
financed acquisition, which heightens risks associated with:
* the timely realization of synergies;
* the retention of non-Party City customers; and
* the stabilization of Party City sales and profits.
These risks are moderated, in part by:
* the sensible combination of the leading vendor and specialty
retailer in the relatively stable party supply market; and
* the company's well-considered synergy, customer retention,
and operational strategies.
These ratings were assigned:
* $85 million senior secured six-year revolving credit
facility, B2;
* $420 million senior secured seven-year term loan
facility, B2.
These ratings remain on review for possible downgrade:
* Corporate family rating (formerly senior implied rating), B1;
* $50 million senior secured revolving credit facility
due 2010, B1;
* $205 million senior secured term loan B facility
due 2012, B1; and
* $175 million 8.75% senior subordinated notes due 2014, B3.
In September 2005, Amscan entered into an agreement to purchase
Party City for approximately $362 million. The transaction is
expected to close by year-end. Although the acquisition price
represents a substantial multiple of Party City's trailing twelve-
month EBITDA, the impact on Amscan's financial leverage is
moderated by a $132 million equity investment by Berkshire
Partners, Weston Presidio, and management.
Further, Moody's recognizes the strategic benefits that may result
from the business combination, including the potential for
incremental sales of Amscan product into Party City's owned and
franchised stores.
Nonetheless, the transaction will leave Amscan with a vulnerable
financial profile, with EBIT-to-interest around 1.3x and debt-to-
EBITDA around 6.6x (both ratios including Moody's standard
adjustments, but excluding management's anticipated synergies),
and modest prospective free cash flow generation during fiscal
2006 (ending December 2006). The company's high leverage and
limited near-term debt repayment prospects heighten the execution
risks surrounding the acquisition, including:
1) realizing sales and cost related synergies in the expected
magnitude and timeframe;
2) maintaining stabilized sales and profit trends at Party City
under new ownership and management, and with retention of
key personnel;
3) managing important non-Party City retail relationships in
order to minimize any potential customer/sales losses; and
4) maintaining distinct operating controls between the retail
and wholesale businesses to eliminate potential conflicts.
While management has sensible strategies to address these
concerns, the company will be challenged to return to its
historical credit metrics in the near-term even under flawless
execution, and could face unforeseen challenges or adverse market
developments. In this last regard, Moody's notes Party City's
historical volatility in terms of:
* store growth, comparable store sales, and profitability;
* the potential for higher energy costs to limit discretionary
spending or customer traffic;
* Amscan's exposure to higher raw material or distribution
costs;
* the risk of incremental category participation by mass
retailers, direct sellers, and other specialty chains; and
* the potential for heightened competition.
Notwithstanding these concerns, the prospective rating levels and
stable outlook also reflect the expectation that Amscan will
realize substantial synergies through the business combination and
begin to meaningfully reduce leverage by fiscal 2007. Moody's
view is supported by the substantial product overlap of Amscan's
existing product portfolio with Party City's non-Amscan SKU.
Further, Moody's notes Amscan's stable historical operating
performance, and the generally moderate risks in party supply
categories related to cyclicality, seasonality, or fads. The
company's product breadth, balloon license portfolio, design
capabilities, and cost efficiency have made it a valuable partner
for its superstore customers, many of which may be reluctant to
switch vendors (particularly smaller independent chains).
Lastly, the ratings are supported:
* by Party City's clear leadership and recognition in the party
superstore channel;
* by the recent comparable sales gains as the company has
improved its merchandising, layouts, and promotional
offerings; and
* by the convenience, selection, and value offered by the
superstores relative to mass retailers and other competitors.
Upward rating pressure is unlikely over the coming year due to the
time needed to successfully execute sales and cost synergy plans,
but could develop over the longer-term if planned profit and cash
flow gains are achieved such that the company maintains debt-to-
EBITDA below 6.0x, EBIT-to-interest over 1.5x, and free cash flow
in mid-single digits as a percentage of debt (all ratios including
Moody's standard adjustments). Similarly, while Amscan has a
moderate cushion at existing rating levels for near-term execution
or operational challenges, sustained profit erosion or negative
cash flow would likely pressure the ratings. In particular,
ratings could be downgraded if leverage exceeds 7.25x or if
Amscan's liquidity becomes constrained in any way.
The B2 rating on the proposed senior secured credit facilities
reflects their predominant position in the pro forma capital
structure, as supported by operating subsidiary guarantees and by
asset and capital stock pledges by Amscan and its subsidiaries.
However, notching consideration above the corporate family rating
level is restricted by the lack of tangible asset coverage and by
the high multiple of EBITDA required to fully-cover the facilities
in a distressed scenario. Moody's anticipates customary
restrictions and financial maintenance covenants, with an initial
mandatory prepayment requirement with 50% of excess cash flow.
Quarterly term loan amortization is expected at an annual rate of
1% per annum, with the balance due at maturity.
Amscan Holdings, Inc., with executive offices in Elmsford, New
York, is a leading manufacturer of party goods and the largest
manufacturer of metallic balloons. The company sells its products
through:
* party superstores,
* party goods retailers, and
* other retail distribution channels.
Party City Corporation, with headquarters in Rockaway, New Jersey,
currently operates more than 500 company-owned and franchised
party goods stores in the United States and Puerto Rico. For the
twelve-month period ended September 2005, the combined companies
had pro forma revenues of around $875 million and pro forma EBITDA
of approximately $100 million, excluding the synergies expected to
be generated by the acquisition.
ANCHOR GLASS: Retired Employees Want Sec. 1114 Committee Created
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Robert L. Simmons, Edna Rusnak and Hiram Miller ask the U.S.
Bankruptcy Court for the Middle District of Florida to appoint a
committee of retired employees under Section 1114 of the
Bankruptcy Code that will have the same rights, powers and duties
as committees appointed under Section 1102 and 1103.
Section 1114(d) provides in relevant part that the Court, upon a
motion by any party-in-interest will appoint a committee of
retired employees if, among others, the Debtor does not pay the
retiree benefits to serve as the authorized representative of
those persons receiving retiree benefits not covered by a
collective bargaining agreement.
The Three Retirees worked for Glass Containers Corporation and are
entitled to "retiree benefits" from Anchor Glass Container Corp.,
Edwin G. Rice, Esq., at Glenn Rasmussen Fogarty & Hooker, PA, in
Tampa, Florida, asserts.
At the time of his retirement, Mr. Simmons held the salaried
position of Vice President, Industrial Relations. Ms. Rusnak
held the salaried position of Administrator of Employee Benefits
and Mr. Miller held the salaried position of Controller. At the
time of their retirement, Mr. Simmons, et al., and their enrolled
spouses qualified to receive "retiree benefits" as the term is
defined in Section 1114(a) of the Bankruptcy Code.
Mr. Rice tells the Court that the retiree benefits are not covered
by a collective bargaining agreement.
The Debtor succeeded to GCC's obligation to provide "retiree
benefits" to Mr. Simmons, et al., through various acquisition and
merger transactions. However, pursuant to a letter dated July 20,
2005, the Debtor informed the Mr. Simmons, et al., that effective
October 1, 2005, it is not going to pay for their retiree
benefits.
Mr. Rice contends that the medical coverage retiree benefits
provided to Mr. Simmons, et al., and their spouses at the time of
their retirement were fully vested and not subject to termination.
"The Debtor has no right to refuse to pay the vested retiree
benefits."
Mr. Rice tells the Court that there are 25 retired salaried
employees of GGC or eligible spouses with fully vested retiree
benefits. The retired employees are elderly. Many of them are in
ill health, live in nursing homes and can't afford medical
coverage.
The Debtor may have as many as 700 retired employees or covered
spouses, who may be eligible for "retiree benefits", Mr. Rice
adds.
Headquartered in Tampa, Florida, Anchor Glass Container
Corporation is the third-largest manufacturer of glass containers
in the United States. Anchor manufactures a diverse line of flint
(clear), amber, green and other colored glass containers for the
beer, beverage, food, liquor and flavored alcoholic beverage
markets. The Company filed for chapter 11 protection on Aug. 8,
2005 (Bankr. M.D. Fla. Case No. 05-15606). Robert A. Soriano,
Esq., at Carlton Fields PA, represents the Debtor in its
restructuring efforts. When the Debtor filed for protection
from its creditors, it listed $661.5 million in assets and
$666.6 million in debts.(Anchor Glass Bankruptcy News, Issue No.
13; Bankruptcy Creditors' Service, Inc., 215/945-7000)
ANCHOR GLASS: Moves to Reject Six Business Compensation Pacts
-------------------------------------------------------------
In separate pleadings, Anchor Glass Container Corporation asks the
U.S. Bankruptcy Court for the Middle District of Florida for
permission to reject six Business Compensation Agreements dated
Oct. 1, 2004, with:
1. Huey Seay & Associates
2. Executive Marketing Group
3. Will Price Sales Co.
4. LaPosta, Petty & Troha
5. McKelvey-Fulks Marketing
6. Paul, Polizzi & Associates
Under the Business Compensation Agreements with the counter
parties, Anchor Glass was responsible for compensating sales
representatives for professional services rendered on certain
sales.
Kathleen S. McLeroy, Esq., at Carlton Fields PA, in Tampa,
Florida, tells the Court that the Debtor's management has
concluded that the Business Compensation Agreements are
burdensome. Anchor Glass' management has determined that the
Agreements no longer provide any benefit to the Debtor's estate.
Headquartered in Tampa, Florida, Anchor Glass Container
Corporation is the third-largest manufacturer of glass containers
in the United States. Anchor manufactures a diverse line of flint
(clear), amber, green and other colored glass containers for the
beer, beverage, food, liquor and flavored alcoholic beverage
markets. The Company filed for chapter 11 protection on Aug. 8,
2005 (Bankr. M.D. Fla. Case No. 05-15606). Robert A. Soriano,
Esq., at Carlton Fields PA, represents the Debtor in its
restructuring efforts. When the Debtor filed for protection
from its creditors, it listed $661.5 million in assets and
$666.6 million in debts. (Anchor Glass Bankruptcy News, Issue No.
13; Bankruptcy Creditors' Service, Inc., 215/945-7000)
ANCHOR GLASS: Class Action Plaintiffs Want to Begin Rule 2004 Exam
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Prior to the Petition Date, Davidco Investors, LLC, on behalf of
itself as lead plaintiff and others similarly situated, filed a
consolidated amended class action complaint against the Debtor and
certain of the Debtor's officers and directors and third parties
in the U.S. District Court for the Middle District of Florida.
The Class Action is pending before Judge Susan C. Bucklew.
Craig P. Rieders, Esq., at Geneovese Joblove & Battista, PA, in
Miami, Florida, notes that the Debtor's Schedules of Assets and
Liabilities and Statement of Financial Affairs list 21 insurance
policies. Mr. Rieders says he also saw a list of certain policies
on an exhibit attached to the Debtor's motion to enter into an
insurance premium financing agreement.
"Some of the policies listed by the Debtor in its schedules may
provide coverage with respect to the claims at issue in the Class
Action Complaint," Mr. Rieders says.
Pursuant to Rule 2004 of the Federal Rules of Bankruptcy
Procedure, Davidco seeks the Court's permission to serve the
Debtor with a Rule 2004 subpoena duces tecum, seeking production
of certain documents, without examination.
Mr. Rieders says Davidco has made written and oral requests for
the information sought. To date, Davidco has not received the
requested information.
Mr. Rieders emphasizes that Davidco is not seeking to take any
action against the Debtor in the Class Action.
Headquartered in Tampa, Florida, Anchor Glass Container
Corporation is the third-largest manufacturer of glass containers
in the United States. Anchor manufactures a diverse line of flint
(clear), amber, green and other colored glass containers for the
beer, beverage, food, liquor and flavored alcoholic beverage
markets. The Company filed for chapter 11 protection on Aug. 8,
2005 (Bankr. M.D. Fla. Case No. 05-15606). Robert A. Soriano,
Esq., at Carlton Fields PA, represents the Debtor in its
restructuring efforts. When the Debtor filed for protection from
its creditors, it listed $661.5 million in assets and
$666.6 million in debts. (Anchor Glass Bankruptcy News, Issue
No. 13; Bankruptcy Creditors' Service, Inc., 215/945-7000)
ARMSTRONG WORLD: Court Approves EFP Floor Settlement Agreement
--------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware approved
the settlement agreement inked between Armstrong World
Industries, Inc., and its debtor-affiliates and EFP Floor
Products Fussboeden GmbH St. Johann.
The EFP Settlement Agreement
The parties specifically agree that:
(1) The parties will execute a joint letter of dismissal,
pursuant to which each of them will dismiss all its claims
in the arbitration proceeding with prejudice, including,
any claim for reimbursement of attorney's fees, costs and
expenses relating to the jurisdictional issue and all
other issues in the Arbitration Proceeding. The Letter of
Dismissal will be held in escrow by Womble Carlyle
Sandridge & Rice, PLLC, pending the occurrence of the
Effective Date. In connection with settlement of the
Arbitration Proceeding, Egger will also pay AWI and
Armstrong Hardwoord $5.25 million.
(2) EFP Floor Products will withdraw four claims filed against
AWI -- Claim Nos. 4639, 4747, and 4753. Moreover, EFP and
and Egger waive all rights to file a claim as unsecured
creditors or otherwise against AWI's estate or property,
including any claim in connection with payment of the
Preference Action Settlement Sum.
(3) AWI will dismiss the Preference Action with prejudice by
executing a Stipulation of Dismissal to be signed by
both AWI and EFP. In connection with the settlement of
the Preference Action, Egger will pay AWI $1.5 million.
The Stipulation of Dismissal, which will be filed with the
Court no earlier than six and no later than 10 business
days after the effective date of the Settlement, will be
held in escrow by Womble Carlyle pending the occurrence
of the Effective Date, and the payment of the Preference
Action Settlement and the Arbitration Settlement Sum.
(4) No later than October 3, 2005, Egger will pay the
Arbitration Settlement Sum and the Preference Action
Settlement Sum into a trust account maintained by an
Escrow Agent within two business days after the
Effective Date. The Escrow Agent will disburse to
Womble Carlyle by wire transfer the Arbitration
Settlement Sum and the Preference Action Settlement Sum.
(5) The parties will execute certain releases with respect
to all claims arising out of or related to the Arbitration
Proceeding, Preference Action, and Chapter 11 cases. The
Releases will beheld in escrow by Ropes & Gray LLP,
attorneys for EFP Floor Products, pending notice that the
Arbitration Settlement Sum and Preference Action
Settlement Sum have been received by Womble Carlyle.
(6) Within 10 days after receiving notice from any of the
parties that the Effective Date did not occur before
December 31, 2005:
-- Womble Carlyle will destroy the Letter of Dismissal,
Stipulation of Dismissal and Notice of Withdrawal of
Claims, and certify that destruction to all Parties;
-- R&G will destroy the Releases and certify that
destruction to all parties; and
-- the Escrow Agent will disburse the Arbitration
Settlement Sum and the Preference Action Settlement
Sum to Egger.
(7) To the extent there are any additional fees, costs or
expenses payable to the Tribunal or there are any
reimbursements received from the Tribunal, those fees
will be divided 50% to AWI and Armstrong Hardwood and
50% to EFP and Egger, to be paid within 30 days after
receiving written notification.
(8) The parties will return or destroy on or before the
later of 30 days after the Effective Date, or
January 31, 2006, all documents furnished during the
course of the Arbitration Proceeding or the Preference
Action that were marked "confidential."
Headquartered in Lancaster, Pennsylvania, Armstrong World
Industries, Inc. -- http://www.armstrong.com/-- the major
operating subsidiary of Armstrong Holdings, Inc., designs,
manufactures and sells interior finishings, most notably floor
coverings and ceiling systems, around the world. The Company and
its debtor-affiliates filed for chapter 11 protection on
December 6, 2000 (Bankr. Del. Case No. 00-04469). Stephen
Karotkin, Esq., at Weil, Gotshal & Manges LLP, and Russell C.
Silberglied, Esq., at Richards, Layton & Finger, P.A., represent
the Debtors in their restructuring efforts. When the Debtors
filed for protection from their creditors, they listed
$4,032,200,000 in total assets and $3,296,900,000 in liabilities.
As of March 31, 2005, the Debtors' balance sheet reflected a
$1.42 billion stockholders' deficit. (Armstrong Bankruptcy
News, Issue No. 83; Bankruptcy Creditors' Service, Inc.,
215/945-7000)
ASARCO LLC: U.S. Government Wants DIP Order Denied or Modified
--------------------------------------------------------------
As reported in the Troubled Company Reporter on Sept. 23, 2005,
ASARCO LLC sought authority from the U.S. Bankruptcy Court for the
Southern District of Texas to enter into an agreement with The CIT
Group/Business Credit, Inc., for $75,000,000 in postpetition
financing.
To secure all obligations under the DIP Facility, ASARCO will
grant The CIT Group a first priority lien on substantially all of
ASARCO's assets, excluding insurance proceeds arising from or
payable as a result of personal injury claims, and subject to
agreed upon carve-outs for the United States Trustee and the
Debtors' and Creditors Committee's professionals. No costs or
expenses of administration will be imposed against the collateral.
U.S. Government Objects
The United States of America on behalf of the Environmental
Protection Agency objects to the provision in the proposed Final
DIP Order restricting the use of Section 506(c) of the Bankruptcy
Code. The proposed Final DIP Order presented by ASARCO LLC
provides that "Bankruptcy Code 506(c) is not applicable to the
DIP Facility, the Collateral, and the DIP Agent and the DIP
Lenders."
Section 506(c) provides for the recovery "from property securing
an allowed secured claim, the reasonable, necessary costs, and
expenses of preserving, or disposing of, such property to the
extent of any benefit to the holder of such claim."
David l. Dain, Esq., of the Environment & Natural Resources
Division -- Environmental Enforcement Section of the U.S.
Department of Justice, in Washington, D.C., points out that in
Hartford Underwriters Insurance Co. v. Union Planters Bank, N.A.,
530 U.S. 1 (2000), the Supreme Court stated that a trustee "is
obliged to seek recovery under [section 506(c)] whenever his
fiduciary duties so require." In this regard, Mr. Dain says the
proposed Final DIP Order would preclude the Debtor from
exercising its required fiduciary duties and is thus contrary to
the Hartford Underwriters ruling. A lender may not require a
debtor to violate its fiduciary duties, Mr. Dain says.
Citing In re Cajun Elec. Power Co-op., Inc., 185 F.3d 446, 453-54
(5th Cir. 1999), and In re H.L.S. Energy Co., 151 F.3d 434, 438
(5th Cir. 1998), Mr. Dain notes that 28 U.S.C. Section 959(b)
requires a debtor to "manage and operate" the collateral property
in its possession in compliance with applicable law. If a
postpetition lender took the position that a debtor could not
take action or spend funds to protect public health and safety
from hazards posed by the collateral, the debtor may have a
fiduciary duty to surcharge the collateral under Section 506(c).
If the debtor refused to exercise its fiduciary duty, Mr. Dain
contends that the EPA may have the right to seek permission from
the Court to require a surcharge to protect public health and
safety.
Mr. Dain tells Judge Schmidt that there is nothing in the
Bankruptcy Code's provisions for postpetition financing providing
for any preemption or waiver of Section 506(c) or 28 U.S.C.
Section 959(b), or of the fiduciary duties of a debtor-in-
possession. Section 364 makes reference to Sections 503 and 507
of the Bankruptcy Code, but makes no reference that it can
somehow override Section 506(c), 28 U.S.C. Section 959, or a
debtor's fiduciary duties.
The U.S. Government asks the Court to deny final approval of the
DIP Financing Agreement unless the proposed Final DIP Order is
modified to carve out an exception for circumstances involving
the violation of 28 U.S.C. Section 959.
Headquartered in Tucson, Arizona, ASARCO LLC --
http://www.asarco.com/-- is an integrated copper mining,
smelting and refining company. Grupo Mexico S.A. de C.V. is
ASARCO's ultimate parent. The Company filed for chapter 11
protection on Aug. 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207).
James R. Prince, Esq., Jack L. Kinzie, Esq., and Eric A.
Soderlund, Esq., at Baker Botts L.L.P., and Nathaniel Peter
Holzer, Esq., Shelby A. Jordan, Esq., and Harlin C. Womble, Esq.,
at Jordan, Hyden, Womble & Culbreth, P.C., represent the Debtor in
its restructuring efforts. When the Debtor filed for protection
from its creditors,it listed $600 million in total assets and $1
billion in total debts.
The Debtor has five affiliates that filed for chapter 11
protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521
through 05-20525). They are Lac d'Amiante Du Quebec Ltee, CAPCO
Pipe Company, Inc., Cement Asbestos Products Company, Lake
Asbestos of Quebec, Ltd., and LAQ Canada, Ltd. Details about
their asbestos-driven chapter 11 filings have appeared in the
Troubled Company Reporter since Apr. 18, 2005.
Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle,
Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No. 05-
21346) also filed for chapter 11 protection, and ASARCO has asked
that the three subsidiary cases be jointly administered with its
chapter 11 case. On Oct. 24, 2005, Encycle/Texas' case was
converted to a Chapter 7 liquidation. (ASARCO Bankruptcy News,
Issue No. 10; Bankruptcy Creditors' Service, Inc., 215/945-7000).
ASARCO LLC: Wants to Assume Amber Glass Construction Pact
---------------------------------------------------------
ASARCO LLC and Amber Glass & Steel, Inc., are parties to an
executory agreement concerning Amber Glass' construction of
structural steel mounts, which are necessary for the installation
of industrial air scrubbers at ASARCO's copper smelter facilities
in Hayden, Arizona.
To comply with state environmental regulations, James R. Prince,
Esq., at Baker Botts L.L.P., in Dallas, Texas, tells the Court
that ASARCO must replace its current ventilation system with more
efficient air scrubbers, which must be installed by the beginning
of December 2005, so that testing and inspections can be
completed by a year-end deadline.
ASARCO ordered the steel mounts, which cost $127,000, in June
2005.
Mr. Prince notes that ASARCO is presently not in default under
the Agreement and no cure payment must be made.
Mr. Prince asserts that failure to obtain regulatory approval
will substantially interfere with the Debtor's ability to conduct
business and will impair the Debtor's efforts to reorganize.
Accordingly, ASARCO asks Judge Schmidt for permission to assume
the Agreement pursuant to Section 365(a) of the Bankruptcy Code.
Headquartered in Tucson, Arizona, ASARCO LLC --
http://www.asarco.com/-- is an integrated copper mining,
smelting and refining company. Grupo Mexico S.A. de C.V. is
ASARCO's ultimate parent. The Company filed for chapter 11
protection on Aug. 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207).
James R. Prince, Esq., Jack L. Kinzie, Esq., and Eric A.
Soderlund, Esq., at Baker Botts L.L.P., and Nathaniel Peter
Holzer, Esq., Shelby A. Jordan, Esq., and Harlin C. Womble, Esq.,
at Jordan, Hyden, Womble & Culbreth, P.C., represent the Debtor in
its restructuring efforts. When the Debtor filed for protection
from its creditors,it listed $600 million in total assets and $1
billion in total debts.
The Debtor has five affiliates that filed for chapter 11
protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521
through 05-20525). They are Lac d'Amiante Du Quebec Ltee, CAPCO
Pipe Company, Inc., Cement Asbestos Products Company, Lake
Asbestos of Quebec, Ltd., and LAQ Canada, Ltd. Details about
their asbestos-driven chapter 11 filings have appeared in the
Troubled Company Reporter since Apr. 18, 2005.
Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle,
Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No.
05-21346) also filed for chapter 11 protection, and ASARCO has
asked that the three subsidiary cases be jointly administered with
its chapter 11 case. On Oct. 24, 2005, Encycle/Texas' case was
converted to a Chapter 7 liquidation. (ASARCO Bankruptcy News,
Issue No. 10; Bankruptcy Creditors' Service, Inc., 215/945-7000).
ASARCO LLC: Final Cash Collateral Hearing Set Today
---------------------------------------------------
As reported in the Troubled Company Reporter on Aug. 15, 2005,
Judge Schmidt of the U.S. Bankruptcy Court for the Southern
District of Texas granted ASARCO LLC authority to use its cash
collateral on an interim basis.
The Court directs ASARCO to deposit $1,280,000 of proceeds of
Mitsui & Co. (U.S.A.), Inc.'s collateral in a newly established
separate segregated bank account.
As ASARCO sells its copper inventory, the Debtor is directed to
continue allocating the proceeds to silver inventory in the same
manner that it has done previously.
As proceeds of Mitsui's collateral are received, the Debtor will
promptly deposit into the Mitsui Cash Collateral Account that
portion of the proceeds that the Debtor has allocated to silver
inventory.
The Court directs the Debtor to provide Mitsui with reports of
the amount of silver inventory on a bi-weekly basis and of the
amount of the Cash Collateral that is segregated in the Mitsui
Cash Collateral Account on a weekly basis pending a final
hearing.
Court Ruling
In the event ASARCO determines it needs to use funds in the
Mitsui Cash Collateral Account, the Debtor may request permission
from the Court, provided however, that Mitsui will be entitled to
seek further protection, including adequate protection.
The Court will convene a final hearing to consider ASARCO's
request today, Nov. 28, 2005, at 2:00 p.m. in Corpus Christi.
Headquartered in Tucson, Arizona, ASARCO LLC --
http://www.asarco.com/-- is an integrated copper mining,
smelting and refining company. Grupo Mexico S.A. de C.V. is
ASARCO's ultimate parent. The Company filed for chapter 11
protection on Aug. 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207).
James R. Prince, Esq., Jack L. Kinzie, Esq., and Eric A.
Soderlund, Esq., at Baker Botts L.L.P., and Nathaniel Peter
Holzer, Esq., Shelby A. Jordan, Esq., and Harlin C. Womble, Esq.,
at Jordan, Hyden, Womble & Culbreth, P.C., represent the Debtor in
its restructuring efforts. When the Debtor filed for protection
from its creditors,it listed $600 million in total assets and $1
billion in total debts.
The Debtor has five affiliates that filed for chapter 11
protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521
through 05-20525). They are Lac d'Amiante Du Quebec Ltee, CAPCO
Pipe Company, Inc., Cement Asbestos Products Company, Lake
Asbestos of Quebec, Ltd., and LAQ Canada, Ltd. Details about
their asbestos-driven chapter 11 filings have appeared in the
Troubled Company Reporter since Apr. 18, 2005.
Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle,
Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No.
05-21346) also filed for chapter 11 protection, and ASARCO has
asked that the three subsidiary cases be jointly administered with
its chapter 11 case. On Oct. 24, 2005, Encycle/Texas' case was
converted to a Chapter 7 liquidation. (ASARCO Bankruptcy News,
Issue No. 10; Bankruptcy Creditors' Service, Inc., 215/945-7000).
ATA AIRLINES: Wants Court to Set Plan Solicitation Deadlines
------------------------------------------------------------
As previously reported in the Troubled Company Reporter, ATA
Airlines, Inc., and its debtor-affiliates ask the U.S. Bankruptcy
Court for the Southern District of Indiana to approve a set of
uniform noticing, balloting, voting and tabulation procedures to
be used in connection with asking creditors to vote to accept
their Chapter 11 plan of reorganization.
Terry E. Hall, Esq., at Baker & Daniels LLP, in Indianapolis,
Indiana, reminds the Court that the Reorganizing Debtors filed
their Plan and a Disclosure Statement explaining the Plan on
September 30, 2005.
In an amended request, the Debtors ask the Court to establish
these deadlines relating to solicitation and tabulation of votes
on their plan of reorganization:
Event Date
----- ----
Record Date December 2, 2005
Objection Deadline to Disclosure December 2, 2005
Statement
Hearing on Disclosure Statement December 6, 2005
Mailing Date for Solicitation Package December 13, 2005
Deadline to seek temporary allowance December 23, 2005
of claims for voting purposes
pursuant to Rule 3018(a) of the Federal
Rules of Bankruptcy Procedure
Deadline for filing exhibits to the Plan January 3, 2006
Hearing on Rule 3018(a) Motions January 3, 2006
Voting Deadline for Plan January 12, 2006
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.
(ATA Airlines Bankruptcy News, Issue No. 41; Bankruptcy Creditors'
Service, Inc., 215/945-7000)
ATA AIRLINES: Wants Midway Gate Deals With Southwest Approved
-------------------------------------------------------------
ATA Airlines, Inc., currently has rights to eight gates at Midway
International Airport under a January 1, 1997 Chicago Midway
Airport Amended and Restated Airport Use Agreement and Facilities
Lease with the City of Chicago, in Illinois.
Pursuant to a December 22, 2004 Asset Purchase Agreement, ATA
Airlines agreed to transfer its rights to six of the 14 Midway
Gates to Southwest Airlines Co. In exchange, Southwest pledged
$117,000,000 in commitments to the Debtors, including $47,000,000
in DIP Credit Facility. Southwest also agreed to codeshare with
ATA out of Midway and other airports.
According to Jeffrey C. Nelson, Esq., at Baker & Daniels LLP, in
Indianapolis, Indiana, the eight Midway Gates are not required by
the business plan upon which the Reorganizing Debtors' amended
Chapter 11 Plan of Reorganization will be based. As a result,
ATA Airlines has sought ways to generate value for its excess
gates at Midway. Moreover, a critical element of the Business
Plan is an extended and expanded codeshare agreement with
Southwest.
As previously reported, the MatlinPatterson Global Opportunities
Partners II L.P., and MatlinPatterson Global Opportunities
Partners (Cayman) II L.P.'s commitment to provide $30,000,000 DIP
Financing to the Reorganizing Debtors and up to $70,000,000 equity
investment to Reorganized ATA is conditioned upon ATA amending its
agreements with Southwest.
By this motion, ATA Airlines asks the U.S. Bankruptcy Court for
the Southern District of Indiana for permission to:
(i) enter into a Midway Gate Restructuring Term Sheet; and
(ii) amend its Codeshare Agreement with Southwest; and
(iii) enter into a number of amendments to the Southwest DIP
Loan Agreement and the Southwest Bid.
Midway Gate Restructuring
The Midway Gate Restructuring Term Sheet provides for the
assignment and exchanges of Midway Gates among the City of
Chicago, ATA Airlines and Southwest. ATA will relinquish all of
its rights to all but one Midway Gate.
The parties will amend the ATA Midway Lease, and the Chicago
Midway Airport Amended and Restated Airport Use Agreement and
Facilities Lease, dated January 1, 1997, between Chicago and
Southwest.
Pursuant to the Amendment to the ATA Midway Lease, ATA Airlines
will transfer its rights to four gates to Southwest and surrender
its rights to the remaining four gates to the City of Chicago.
Southwest will assign its rights to one Midway Gate to ATA.
Upon closing, Southwest will obtain an additional four Midway
Gates, ATA will retain only one Midway Gate, and the City will
have full use, control and all rights to three additional Midway
Gates.
As part of the Midway Gate Transactions, Southwest agrees to
reduce the outstanding balance of the Southwest DIP Loan by
$20,000,000, which equates to a $5,000,000 per gate reduction.
Mr. Nelson notes that the $5,000,000 per gate is less than the
$5,670,000 per gate paid by Southwest for the Original Gates, and
the $6,250,000 per gate for ATA's 14 Midway Gates previously
offered by AirTran Airways, Inc.
However, Mr. Nelson points out that the Midway Gates assigned to
Southwest are not as desirable as the Original Gates and the
AirTran Offer contemplated the purchase of 23 arrival and
departure slots at Reagan and LaGuardia airports.
Mr. Nelson adds that ATA Airlines will receive valuable non-cash
considerations under the Midway Gate Transactions, including the
rights to the New ATA Gate and the benefits of the Southwest
Amendments.
A full text copy of the Midway Gate Restructuring Term sheet is
available for free at:
http://bankrupt.com/misc/3253_exhibit_a.pdf
Amended Codeshare Agreement
ATA Airlines and Southwest agree to amend their Codeshare
Agreement, which will provide important economic benefits to ATA
and is an important component of the Business Plan.
The parties did not disclose the terms of the Amended Codeshare
Agreement and ATA will file the Agreement with the Court under
seal.
Pursuant to the MatlinPatterson Bid, Southwest and ATA Airlines
are prohibited to, among others, amend the Codeshare Agreement
without MatlinPatterson's consent.
Amendment to Other Agreements
Southwest and ATA Airlines agree to amend various agreements
between them so that no actions or results that are consistent
with (i) ATA's current financial projections, (ii) current
reorganizations plans and (iii) proposed transaction with
MatlinPatterson will cause an event of default under the Southwest
DIP Loan Agreement.
The parties agree to amend to the Southwest DIP Loan Agreement to
remove certain financial covenants and to provide that the
Reorganizing Debtors will have until January 31, 2006, to confirm
a plan of reorganization.
They also agree to amend the Southwest Bid and related documents
so that Southwest's commitment to provide the Southwest Equity
Investment is terminated upon the receipt by the Reorganizing
Debtors of the Exit Financing from MatlinPatterson.
ATA Airlines has agreed to reimburse $1,000,000 to Southwest for
its expenses incurred in connection with the Midway Gate
Restructuring Term Sheet and the Amended Codeshare Agreement Term
Sheet.
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.
(ATA Airlines Bankruptcy News, Issue No. 41; Bankruptcy Creditors'
Service, Inc., 215/945-7000)
BEACON POWER: Terminates Arrangement Agreement with NxtPhase
------------------------------------------------------------
Beacon Power Corporation (NASDAQ: BCON), NxtPhase T&D Corporation
and Class A shareholders of NxtPhase have executed a settlement
agreement that terminates an arrangement agreement, originally
signed on April 22, 2005, under which Beacon was to acquire
NxtPhase in an all-stock transaction. As part of the settlement
agreement, each side agreed to release one another from any legal
claims or actions resulting from the process, and Beacon also
agreed to pay $150,000 to NxtPhase.
The arrangement agreement specified that the transaction would
automatically terminate if not completed by Dec. 31, 2005.
Considering the status of the SEC review process and the limited
time remaining until Dec. 31, as well as the increase in Beacon's
stock price since the signing of the agreement, it was determined
that the transaction was unlikely to be completed.
"We believe that this decision is in the best interests of our
shareholders," Bill Capp, Beacon Power president and CEO, said.
"With substantial new financing for Beacon now in place and with
final resolution of this proposed acquisition, we can focus our
attention on building and deploying our next-generation flywheel
systems for grid frequency regulation and other commercial
applications."
Settlement Agreement
Under the terms of the investment agreement between Beacon Power
and Perseus entered into in April 2005, the termination of the
NxtPhase arrangement agreement obligates Beacon and Perseus to
consummate an exchange whereby approximately 1.2 million shares of
the company's common stock that had been issued to Perseus 2000
Expansion, L.L.C. under the investment agreement will be returned
by Perseus to Beacon in exchange for Class A shares of NxtPhase
that Beacon purchased with the proceeds of some of Perseus's
investment in Beacon. After giving effect to Beacon's previously
announced $15 million investment, which closed on Nov. 8, and to
this rescission and share exchange with Perseus, Beacon will have
approximately 57.8 million common shares outstanding.
Beacon will withdraw its preliminary proxy statement, filed with
the SEC on Sept. 29, 2005, in connection with the proposed
NxtPhase acquisition. Thus, no special shareholder meeting will
be held in December, and no additional Beacon shares will be voted
upon or issued as part of the NxtPhase transaction. The two
companies will pursue their business objectives independently,
operating as separate companies.
About NxtPhase T&D Corporation
Headquartered in Vancouver, British Columbia, NxtPhase T&D
Corporation -- http://www.nxtphase.com/-- develops,
manufactures, and markets optical sensors and digital protection
and recording solutions that are designed to improve the way
high-voltage electric power is managed in a competitive electric
power industry. Optical current and voltage sensing products
offer more accurate digital information, broader dynamic range,
wider bandwidth, improved safety, and significant environmental
benefits compared with conventional technologies. Digital
recorders provide operators with information required to improve
grid reliability and to better understand the causes of and to
protect against blackouts. NxtPhase T&D Corporation is a
privately held company with sales and manufacturing operations in
the U.S. and Canada.
About Perseus, L.L.C.
Perseus, L.L.C. is a merchant bank and private equity fund
management company with offices in Washington, D.C. and New York
City. Perseus generally invests in companies in which it can
participate in the company's strategic planning, operations and
development and thereby add significant value to the investment.
In particular, Perseus invests in companies that have unique
strategic characteristics i.e., proprietary intellectual property,
powerful brands, distinctive content or a highly skilled work
force. Perseus and its affiliates manage several investment funds
with total commitments in excess of $2.0 billion.
About Beacon Power Corporation
Headquartered in Wilmington, Massachusetts, Beacon Power
Corporation -- http://www.beaconpower.com/-- designs
sustainable energy storage and power conversion solutions that
would provide reliable electric power for the utility, renewable
energy, and distributed generation markets. Beacon's Smart Energy
Matrix is a design concept for a megawatt-level, utility-grade
flywheel-based energy storage solution that would provide
sustainable power quality services for frequency regulation, and
support the demand for reliable, distributed electrical power.
Beacon is a publicly traded company with its research, development
and manufacturing facility in the U.S.
Going Concern Doubt
Beacon Power Corporation's 2004 Annual Reports contains its
management's concerns about the company's ability to continue as a
going concern. The company needs additional capital to operate
its business, as its Dec. 31, 2004, cash balances are sufficient
to fund operations only through approximately May 2005.
BERTHEL GROWTH: Sept. 30 Balance Sheet Upside-Down by $6 Million
----------------------------------------------------------------
Berthel Growth & Income Trust 1 delivered its quarterly report on
Form 10-Q for the quarter ending Sept. 30, 2005, to the Securities
and Exchange Commission on Nov. 8, 2005.
The company reported a $162,888 net investment loss on $56,390 of
total revenues for the quarter ending Sept. 30, 2005.
Going Concern Doubt
At Sept. 30, 2005, the Trust reported $8,520,483 in total assets
and $14,488,007 in total liabilities. That $5,967,524 trust
deficit raises substantial doubt about the ability of the Trust to
continue as a going concern. The trust deficit was $5,252,382
Dec. 31, 2004.
In August 2002, the United States Small Business Administration
notified Berthel SBIC, LLC, a wholly owned subsidiary of the
Trust, that all debentures, accrued interest and fees were
immediately due and payable. Berthel SBIC was transferred into
the Liquidation Office of the SBA at that time. On Sept. 1, 2003,
management signed a loan agreement with the SBA for $8,100,000
(after paying $1,400,000 on the $9,500,000 debentures) with a term
of 48 months at an interest rate of 7.49%. The Agreement requires
principal payments on the debt to the extent Berthel SBIC receives
cash proceeds exceeding $250,000 for the sale or liquidation of
investments. As of Sept. 30, 2005, $7,426,919 is outstanding
under the loan agreement, which is secured by substantially all
assets of Berthel SBIC. The loan agreement contains various
covenants, including limits on the amounts of expenses, other than
interest expense, that can be incurred and paid. The loan
agreement also contains various events of default, including a
decrease in the aggregate value of Berthel SBIC's assets of 10% or
greater.
A full-text copy of the regulatory filing is available at no
charge at http://ResearchArchives.com/t/s?32c
Berthel Fisher & Company, Inc., the parent of the Trust Advisor,
has $2.2 million of unsecured debt that was due Dec. 31, 2002.
Berthel Fisher & Company, Inc. has not paid this debt as of
Aug. 11, 2003, and is in default. Since Berthel Fisher & Company,
Inc. is in default, its creditors could take legal action to
enforce their right to repayment. Ultimately, this could result
in the bankruptcy of Berthel Fisher & Company, Inc. Since the
Trust Advisor is a subsidiary and asset of Berthel Fisher &
Company, Inc., the bankruptcy of Berthel Fisher & Company, Inc.
could cause the Trust Advisor to be unable to continue as a going
concern. If this were to happen, the Trust would need to appoint
a new trust advisor. The new trust advisor could require
additional fees and charges that would have a significant negative
impact on the Trust.
BOYDS COLLECTION: Hires Swidler Berlin as Bankruptcy Co-Counsel
---------------------------------------------------------------
The Boyds Collection, Ltd., and its debtor-affiliates sought and
obtained permission from the U.S. Bankruptcy Court for the
District of Maryland to employ Swidler Berlin LLP as their
bankruptcy co-counsel in Maryland.
The Debtors believe that the Firm's services will be complementary
to that of Kirkland & Ellis' services as their bankruptcy counsel.
The Debtors tell the Court that Kirkland & Ellis will require the
assistance of a Maryland counsel in their chapter 11 proceedings.
Specifically, Swidler Berlin will:
(a) provide the Debtors legal advice with respect too their
powers and duties as a debtor in possession and in the
operation of their business and management of their
property;
(b) represent the Debtors in defense of any proceedings
instituted to reclaim property or to obtain relief from the
automatic stay under section 362(a) of the Bankruptcy Code;
(c) prepare any necessary applications and other legal papers,
and appear on the Debtors' behalf in proceedings instituted
by or against the Debtors;
(d) assist the Debtors in the preparation of schedules,
statements of financial affairs and any amendments which the
Debtors may be required to file in these cases;
(e) assist the Debtors in the preparation of a plan of
reorganization and a disclosure statement;
(f) assist the Debtors with all legal matters, including, all
securities, corporate, real estate, tax, employee relations,
general litigation and bankruptcy legal work; and
(g) perform all other necessary legal services.
Roger Frankel, Esq., reports that his Firm's professionals bill:
Designation Hourly Rate
----------- -----------
Partners, $400-$645
Senior Counsel &
Of Counsel
Associates $205-$310
Legal Assistants $145-$195
Mr. Frankel discloses that his Firm received a $50,000 retainer
from the Debtors and is not owed any amounts with respect to its
prepetition fees.
Mr. Frankel assures the Court that his Firm does not hold any
interest adverse to the Debtors' estate.
Headquartered in McSherrystown, Pennsylvania, The Boyds
Collection, Ltd. -- http://www.boydsstuff.com/-- designs and
manufactures unique, whimsical and "Folksy with Attitude(SM)"
gifts and collectibles, known for their high quality and
affordable pricing. The Company and its debtor-affiliates filed
for chapter 11 protection on Oct. 16, 2005 (Bankr. Md. Lead Case
No. 05-43793). Matthew A. Cantor, Esq., at Kirkland & Ellis LLP
represents the Debtors in their restructuring efforts. As of
June 30, 2005, Boyds reported $66.9 million in total assets and
$101.7 million in total debts.
BOYDS COLLECTION: Wants to Retain Deloitte & Touche as Auditors
---------------------------------------------------------------
The Boyds Collection, Ltd., and its debtor-affiliates ask the U.S.
Bankruptcy Court for the District of Maryland for permission to
retain Deloitte & Touche LLP as their independent auditors and
accountants.
Deloitte & Touche is expected to:
a) audit and report the Debtors and their non-debtor
affiliates' consolidated financial statements for the year
ending Dec. 31, 2005, and thereafter;
b) review quarterly financial information to be included in
reports of the Debtors filed with the United States
Securities and Exchange Commission; and
c) provide other audit and accounting services, as may be
requested by the Debtors.
The Firm's professionals current hourly rates:
Designation Hourly Rate
----------- -----------
Partner/Principal/Director $600 - $750
Senior Manager $460 - $500
Manager $340 - $400
Senior Staff $270 - $300
Staff $220 - $230
To the best of the Debtors' knowledge, Deloitte & Touche
represents no interest adverse to the Debtors or their estate.
Headquartered in McSherrystown, Pennsylvania, The Boyds
Collection, Ltd. -- http://www.boydsstuff.com/-- designs and
manufactures unique, whimsical and "Folksy with Attitude(SM)"
gifts and collectibles, known for their high quality and
affordable pricing. The Company and its debtor-affiliates filed
for chapter 11 protection on Oct. 16, 2005 (Bankr. Md. Lead Case
No. 05-43793). Matthew A. Cantor, Esq., at Kirkland & Ellis LLP
represents the Debtors in their restructuring efforts. As of
June 30, 2005, Boyds reported $66.9 million in total assets and
$101.7 million in total debts.
BRAVO! FOODS: Posts $4.9 Million Net Loss in Qtr. Ended Sept. 30
----------------------------------------------------------------
Bravo! Foods International Corp., delivered its financial results
for the quarter ended Sept. 30, 2005, to the Securities and
Exchange Commission on Nov. 14, 2005.
The company reported a net loss for the three months ended
Sept. 30, 2005 of $4,906,456 compared with a net loss of
$1,120,992 for the same period in 2004. The net loss increased by
$3,785,464 or 337.7% compared to the same period in 2004. Of the
$4,906,456 net loss, $3,000,000 represents a one time, non-
recurring finder's fee payable to a third party in connection with
the execution of the Master Distribution Agreement with Coca-Cola
Enterprises, Inc.
Coca-Cola Takes Control
At December 31, 2004, Bravo's balance sheet showed liabilities
exceeding assets by $3 million. That capital deficit was reversed
on July 13, 2005, after the sale of a basket of options to Coca-
Cola Enterprises Inc. to purchase shares of common stock,
convertible securities and warrants, entitling Coca-Cola
Enterprises to purchase approximately 69,000,000 shares
of common stock from nine non-affiliated shareholders of the
Company, representing approximately 23% of the authorized shares
of the Company's common stock. Coca-Cola Enterprises and the
Company contemporaneously commenced negotiations regarding a stock
purchase agreement for the direct sale of approximately 81 million
shares of the Company's common stock to Coca-Cola Enterprises.
The consummation of the direct sale and the exercise of the
Options by Coca-Cola Enterprises would have resulted in Coca-Cola
Enterprises holding slightly in excess of 50% of the Company's
equity on a fully diluted basis. These transactions were
contingent upon the execution of a Master Distribution Agreement
between the Company and Coca-Cola Enterprises. On July 29, 2005,
the Company and Coca-Cola Enterprises entered into a Letter of
Intent memorializing and confirming their intention to enter into
the stock purchase agreement. The company's balance sheet shows a
$7.5 million capital surplus at Sept. 30, 2005.
New Personnel
The company reported that its growth has necessitated the hiring
of additional management personnel for corporate and anticipated
hiring of field personnel to accommodate the regional business
units of CCE. The Company introduced Jeffrey Kaplan as its new
Chief Financial Officer and Michael Comerford as its new Director
of Operations. Tommy Kee, the Company's former CFO, will assume
the duties of Chief Accounting Officer and will continue to report
directly to Roy Warren, CEO. Mr. Comerford will report to
Benjamin Patipa, the Company's Chief Operating Officer. Six new
regional managers will be hired to service the 6 regional business
units of CCE and will report to Mike Edwards, the Company's
Executive Vice President of Sales.
Going Concern Doubt
Lazar Levine & Felix LLP expressed substantial doubt about the
company's ability to continue as a going concern after it audited
the company's financial statement for the fiscal year ended
Dec. 31, 2004. The auditing firm pointed to the company's
recurring losses, working capital deficiency, shareholder deficit,
and delinquent debts.
Bravo! Foods International Corp. -- http://www.bravobrands.com/--
develops, brands, markets, distributes and sells nutritious,
flavored milk products throughout the 50 United States, Great
Britain and various Middle Eastern countries. Bravo!'s products
are available in the United States and internationally through
production agreements with regional aseptic milk processors and
are currently sold under the brand name Slammers(R).
Many of Bravo! Foods' Slammers(R) lines of shelf-stable, single-
serve milk drinks are co-branded through exclusive partnerships
with Masterfoods, a division of Mars Incorporated, Marvel
Entertainment and MD Enterprises (Moon Pie(R)), providing superior
name recognition packaged with quality, great- tasting drinks.
Slammers(R) are now available at more than 30,000 stores
nationwide, including such popular chains as: 7-Eleven, A&P,
Associated Grocers, Bi-Lo, Bruno's, C/S Metro, Dutch Farms, Giant
Food Stores, Jewel, Mars, Pathmark, Piggly Wiggly, Ralphs,
Safeway, Sam's Club, Shaw's, ShopRite, Speedway, SuperTarget,
Unified, Waldbaums, Walgreens and White Rose.
CATHOLIC CHURCH: Litigants Balk at Spokane's Disclosure Statement
-----------------------------------------------------------------
The Official Committee of Tort Litigants argues that the Diocese
of Spokane's Disclosure Statement fails to provide even a modicum
of meaningful information to creditors, either on the debt side or
asset side of the Diocese's balance sheet.
James Stang, Esq., at Pachulski, Stang, Ziehl, Young, Jones &
Weintraub PC, in Los Angeles, California, contends that the
Disclosure Statement does not provide any information regarding
the total amount of the sex abuse claims against the Diocese.
After three years of litigation with sex abuse survivors and after
participating in an internal survey as part of the John Jay study
of sex abuse in the Church in America, the best the Diocese can
say is that it cannot "at this time, estimate the magnitude of the
amount of the Tort Claims," Mr. Stang notes.
The Litigants Committee further argues that the Diocese promises
that creditors will have access to an alternative dispute
resolution process or litigation for allowance of claims.
However, Spokane fails to provide any of the documents setting
forth the protocols or the trust agreements that administer the
funds for the payment of allowed claims. On the asset side, the
Disclosure Statement is equally devoid of any material data.
Mr. Stang tells Judge Williams of the U.S. Bankruptcy Court for
the Eastern District of Washington that the Diocese does not
provide any information regarding the value of the Parish
properties. As to insurance coverage, the Diocese throws up its
hands and says, "[a]t this time it is not possible for the
Diocese to provide even an estimate of the total value of the
Insurance Actions."
Accordingly, Mr. Stang believes that the Disclosure Statement was
"nothing more than a placeholder so that the Diocese could extend
its exclusivity period for another 60 days."
The Court is well versed in the standards for approval of a
disclosure statement and the Litigants Committee will save the
Court from the tedium of reviewing lengthy points and authorities
at this stage of the proceeding, Mr. Stang maintains.
The Litigants Committee believes that the Plan of Reorganization
contains provisions that make it unconfirmable, that is, that the
Diocese is not bound to satisfy the Best Interest of Creditors
test.
The Litigants Committee has not identified those provisions
assuming that the Court would reserve those issues for the
confirmation hearing, Mr. Stang says.
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. 47; Bankruptcy Creditors' Service, Inc., 215/945-7000)
CATHOLIC CHURCH: Portland Wants Estimations Procedures Approved
---------------------------------------------------------------
The Archdiocese of Portland in Oregon asks the U.S. Bankruptcy
Court for the District of Oregon to estimate and temporarily allow
all unresolved present child sex abuse tort claims filed by
April 29, 2005, for the limited purposes of voting on, and
confirmation of, Portland's Plan of Reorganization.
Thomas W. Stilley, Esq., at Sussman Shank LLP, in Portland,
Oregon, informs Judge Perris that actual liquidation for purposes
of distribution of the Unresolved Present Child Sex Abuse Tort
Claims will unduly delay the administration of Portland's
bankruptcy case.
Most of the Unresolved Present Child Sex Abuse Tort Claims assert
a right to jury trial. Only two of the Claims were ready for
trial on the Petition Date since discovery has just begun with the
rest of the Claims. Due to the passage of time, Mr. Stilley
asserts that additional trial preparation will now be necessary,
even in the two cases. After completion of discovery, most of the
Present Child Sex Abuse Tort Claims must be briefed for
potentially dispositive motions.
"It will take many years for these cases to be liquidated by jury
trial for purposes of distribution," Mr. Stilley says.
Specifically, according to Mr. Stilley:
1. thorough discovery is required in each case because of the
amount of damages sought and the decades that have passed
between the time of the alleged events and the actual
filing of the claims;
2. independent medical and psychological experts must
evaluate each plaintiff;
3. additional discovery and briefing will be required to
evaluate the Archdiocese's statute of limitations and
other defenses including substantial constitutional
issues; and
4. other investigation and preparation will be necessary.
Furthermore, given the complicated and unique legal issues
involved in the claims, the likelihood of appellate review of any
trial verdicts could add several more years to the process.
Portland does not want years to pass before Plan confirmation,
Mr. Stilley explains. The Archdiocese believes that the temporary
allowance of the Unresolved Present Child Sex Abuse Tort Claims is
absolutely necessary to avoid undue delay in the administration of
its Chapter 11 case.
The litigation of the pending Property of the Estate Adversary
Proceeding has consumed over $1,000,000 of Portland's resources to
date, and will continue to be enormously costly. Mr. Stilley
points out that the Adversary Proceeding could be rendered
unnecessary or moot if Portland's proposed Plan is confirmed.
Estimation Procedures
Portland's proposed estimation methodology is based primarily on
140 prepetition claims alleging sexual abuse of minors that were
actually liquidated within 2000 to 2004. The Liquidation occurred
within the adversary system of the Oregon state courts, pursuant
to settlements between the Archdiocese and child sex abuse tort
claimants.
A total of 45 claims alleging misconduct by former priest Maurice
Grammond were liquidated for $28,404,500, for an average of
$631,211 per claim, and 14 claims alleging misconduct by former
priest Thomas Laughlin were liquidated for $10,054,765, for an
average of $773,443 per claim. The remaining 82 non-Grammond and
non-Laughlin claims liquidated for $14,942,834, for an average of
$182,230 per claim.
According to Mr. Stilley, the average value of the Settled Claims
is highly probative of the aggregate actual value of the
Unresolved Present Child Sex Abuse Tort Claims for purposes of
Plan confirmation.
The Settled Claims and the Unresolved Present Child Sex Abuse
Tort Claims have similar characteristics, including:
-- proximity in time of liquidation;
-- type and nature of alleged abuse;
-- range of time period from the alleged occurrence until the
assertion of the claim;
-- range of alleged damages;
-- identity of employer or principal of the accused
wrongdoers;
-- applicable law;
-- representation by and identity of claimants' attorneys; and
-- requests for jury trials.
Based on the Settled Claims Data, the Unresolved Present Child
Sex Abuse Tort Claims is expected to actually liquidate in amounts
ranging from $0 to over $1,000,000. However, since most of the
Unresolved Present Child Sex Abuse Tort Claims are in the earliest
stages of discovery, Mr. Stilley submits that it is speculative at
this time to predict whether any Unresolved Present Child Sex
Abuse Tort Claim will liquidate for $0, $1,000,000, or, more
likely, at some point in between. The only certainty, Mr. Stilley
says, is that a claimant's allegations of the amount of damages he
or she is entitled to receive has no correlation to the amount of
damages the claimant will ultimately receive.
On the other hand, Mr. Stilley relates that the Settled Claims
Data is conclusive evidence of the actual liquidations of claims
similar to the Unresolved Present Child Sex Abuse Tort Claims
within the four years prior to the Petition Date and the year
after the Petition Date.
Estimation Formula
Portland asks the Court to approve its proposed method or formula
for estimating Unresolved Present Child Sex Abuse Tort Claims.
To arrive at the Aggregate Amount of the Claims, Portland will use
$182,230 per claim to value each Unresolved Child Sex Abuse Tort
Claim against persons accused other than Mssrs. Grammond and
Laughlin. Each unresolved claim accusing:
-- Mr. Grammond will be valued at $631,211; and
-- Mr. Laughlin will be valued at $773,443.
The Aggregate Amount will be determined by multiplying the number
of claims in each category remaining after disallowance of claims
prior to confirmation through the claims objection process, by
the established liquidation value of each category of claims:
Weighted Average Value of Settled Prepetition Claims:
Grammond $631,211
Laughlin $773,443
All other claims $182,230
x Number of Unresolved Present Child Sex Abuse Tort Claims
Grammond
Laughlin
All others
= Aggregate amount necessary to pay Unresolved Present Child
Sex Abuse Tort Claims
Portland maintains that the number of unresolved claims will be
subject to change up to the time of confirmation of the Plan.
Portland notes that a weighted average of the Settled Prepetition
Claim values, multiplied by the number of Unresolved Present
Child Sex Abuse Tort Claims provides a fair, reliable and accurate
method of determining the Aggregate Amount necessary to pay the
Claims in full.
Falling Average
Mr. Stilley discloses that the Settled Claims Data established a
clear "falling average" between 2000 and 2005. The average
liquidation value of claims has diminished substantially over
time.
The average settlement value in October 2000 was $750,000. The
average settlement value between 2001 and 2004 was $301,323.
Claims resolved postpetition in 2005, including filed proofs of
claim, have an average value of $127,582. Using the placeholder
of $5,000 for each claim resolved for zero dollars, 59 claims have
been resolved as to amount postpetition, for a total of
$6,882,000, which averages $127,582 per claim.
Despite the evidence of lower postpetition average liquidation
value, Mr. Stilley maintains that Portland's methodology uses the
higher, prepetition settlement values of claims to estimate the
Unresolved Present Child Sex Abuse Tort Claims. The Aggregate
Amount, therefore, will be larger than necessary to compensate the
Unresolved Present Child Sex Abuse Tort Claims.
Accordingly, Portland wants the amount of damages alleged by
claimants to be completely rejected as valid evidence of the
estimated value of the Unresolved Present Child Sex Abuse Tort
Claims because the allegations have no correlation to the amount
of damages the claimant will ultimately receive.
Jury Trial
The Debtor's estimation method accounts for the possibility of
liquidation by jury trial. Portland's proposed Plan and Claims
Resolution Facility provide for all methods of liquidation for
purposes of distribution. Any jury trial will occur in the U.S.
District Court for the District of Oregon.
Portland intends to file a request to estimate Future Claims after
its independent expert, Hamilton, Rabinovitz & Alschuler, Inc.,
completes its analysis regarding Future Claims. Portland will
also file requests to estimate or to disallow other contingent,
non-liquidated claims prior to Plan confirmation.
The Archdiocese of Portland in Oregon filed for chapter 11
protection (Bankr. Ore. Case No. 04-37154) on July 6, 2004.
Thomas W. Stilley, Esq., and William N. Stiles, Esq., at Sussman
Shank LLP, represent the Portland Archdiocese in its restructuring
efforts. In its Schedules of Assets and Liabilities filed with
the Court on July 30, 2004, the Portland Archdiocese reports
$19,251,558 in assets and $373,015,566 in liabilities. (Catholic
Church Bankruptcy News, Issue No. 47; Bankruptcy Creditors'
Service, Inc., 215/945-7000)
CENTRAL WAYNE: Wants to Hire Gazes as Special Litigation Counsel
----------------------------------------------------------------
Central Wayne Energy Recovery Limited Partnership asks the U.S.
Bankruptcy Code for the District of Maryland, Baltimore Division,
for permission to employ Gazes LLC as its special litigation
counsel.
The Debtor explains that the confirmation hearing for its First
Amended Plan of Liquidation is scheduled on Dec. 5, 2005. Upon
confirmation of the Plan, Gazes will be appointed as liquidating
trustee of a liquidating trust to be established for the purpose
of continuing the liquidation of the Debtor's assets.
Before the plan's confirmation, Gazes will be primarily involved
in pursuing avoidance claims arising under Sections 544, 545, 547,
548 and 553 of the Bankruptcy Code. Gazes will also investigate
the potential avoidance claims and, if necessary, file complaints
on account of those claims.
Ian J. Gazes, Esq., a Principal of Gazes LLC, reports that his
Firm's compensation will be on the same terms as those proposed in
Section 6.1.g. of the Plan, which governs compensation to Gazes
after the Plan's confirmation.
Gazes LLC will receive 43% of the gross recovery received on
account of any avoidance claims, plus reimbursement of related
expenses, and payment of Gazes' compensation will have priority
over payment of all claims other than administrative, priority tax
and other priority claims.
Pursuant to the Plan, Gazes will not be entitled to any
compensation other than the contingency fees and Gazes' hourly
fees for services related to the adversary proceeding against The
Detroit Edison Company and Michigan Consolidated Gas Company
Gazes LLC 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 Baltimore, Maryland, Central Wayne Energy
Recovery LP owns a waste-to-energy system facility that converts
the heat energy generated by incinerating waste to electricity.
The Company filed for chapter 11 protection on December 29, 2003
(Bankr. D. Md. Case No. 03-82780). Maria Chavez Ruark, Esq.,
Piper Rudnick LLP represent the Debtor from its creditors. When
the Company filed for protection from its creditors, it listed
more than $10 million in assets and more than $100 million in
debts.
CHAMPIONSHIP AUTO: Posts $124,00 Net Loss in Qtr. Ended Sept. 30
----------------------------------------------------------------
Championship Auto Racing Teams, Inc., delivered its financial
results for the quarter ended Sept. 30, 2005, to the Securities
and Exchange Commission on Nov. 14, 2005.
Total expenses were $160,000 for the three months ended Sept. 30,
2005, consisting of legal and consulting fees of $4,000, salaries,
employee and related expenses of $94,000, insurance of $64,000 and
other office and miscellaneous expenses and credits.
Interest income from cash investments for three months ended
Sept. 30, 2005 was $36,000. Net loss for the three months ended
Sept. 30, 2005 was $124,000.
Total expenses were $1.1 million for the nine months ended
Sept. 30, 2005, which were partially offset by a recovery of
$450,000 from the CART Liquidation Trust. Expenses consisted of
legal and consulting fees of $391,000, salaries, employee and
related expenses of $495,000, insurance of $198,000 and other
office and miscellaneous expenses and credits. Interest income
from cash investments for nine months ended Sept. 30, 2005 was
$91,000. Income tax expense for the nine months ended September
30, 2005 was $25,000. Net loss for the Nine months ended
September 30, 2005 was $574,000.
At Sept. 30, 2005, the company had $4.9 million in working
capital, and its primary source of liquidity was $4.9 million in
cash and cash equivalents. The company's cash balance on
Sept. 30, 2005 was $4.9 million, a net decrease of $516,000 from
Dec. 31, 2004. This decrease was the result of net cash used in
operating activities of $516,000.
Lease Agreement
In April 2002, the company entered into a lease for its corporate
headquarters in Indianapolis, Indiana. The lease commenced on
May 1, 2002 and expires on Oct. 31, 2010. The total amount due
through the life of the lease as of Sept. 30, 2005 is $1.6
million. The company has sublet this office space to Open Wheel,
and retains office space for its use, at no cost. However, the
company remains liable on the lease.
Plan of Liquidation
The company intends to:
* liquidate its remaining assets,
* pay off remaining liabilities, and
* complete the process of liquidation and winding up the
Company's affairs.
The company's Board of Directors has adopted a plan of liquidation
and dissolution subject to the approval of the stockholders at a
stockholders meeting scheduled for Dec. 13, 2005. In the event
that the stockholders adopt the plan of liquidation and
dissolution, the company would expect to incur liquidation
expenses, in addition to payments of ongoing operating expenses
and settlement of existing or potential obligations.
Championship Auto Racing Teams, Inc. previously owned and operated
the Champ Car World Series. The Company has sold all of its
operating assets and is in the process of winding up its affairs.
The Company's formerly wholly owned subsidiary, CART, Inc., filed
a chapter 11 petition on December 16, 2003 (Bankr. S.D. Ind. Case
No. 03-23385). Pursuant to the bankruptcy court order, the
Company sold the operating assets of CART and the stock of Pro-
Motion Agency, Inc., a former wholly owned subsidiary of the
Company and CART Licensed Products, Inc., a former wholly owned
subsidiary of CART, Inc. Also, pursuant to the bankruptcy court
order, the Company cancelled its stock in CART, Inc. and
transferred the remaining assets and liabilities to an
unconsolidated liquidating trust. During 2003, the Company ceased
the operations of its wholly owned subsidiary, Raceworks LLC, and
intends to liquidate its remaining assets
* * *
Going Concern Doubt
As reported in the Troubled Company Reporter on May 9, 2005,
Deloitte & Touche LLP audited Championship Auto Racing Teams,
Inc.'s financial statements for the year ending December 31, 2004.
At the conclusion of that engagement, the auditing firm says
there's substantial doubt about the company's ability to continue
as a going concern. The auditors point to the Company's recurring
loses from operations; the sale of substantially all the operating
assets of its CART, Inc., subsidiary; pending or threatened
litigation against the Company and its subsidiaries; and the
Company's intent to liquidate its remaining assets.
CIRCLE GROUP: Posts $1 Million Net Loss in Third Quarter
--------------------------------------------------------
Circle Group Holdings, Inc., delivered its financial results for
the quarter ended Sept. 30, 2005, to the Securities and Exchange
Commission on Nov. 14, 2005.
The company reported net loss for the third quarter of 2005 of
$1,005,021, a 188% decrease from the net income of $56,827 for the
third quarter of 2004. For the nine months ending Sept. 30, 2005,
the Company reported a net loss of $4,969,891, a 96% increase from
a net loss of $2,529,285 for the nine-month period ending
Sept. 30, 2004. This was due to a combination of the decrease in
revenues, the introduction and promotion of Z-Trim products, the
increase in investor and public relation expenses, and a provision
of an uncollectible note receivable.
Total assets decreased to $7,469,285 at Sept. 30, 2005 from
$7,957,409 on Dec. 31, 2004. This was primary the result of the
net operating loss, offsetting against the proceeds received from
equity transactions. Total equity increased to $6,657,450 on
Sept. 30, 2005 compared to $5,833,958 for the year ended Dec. 31,
2004.
Revenues decreased by $49,576 or 28% to $124,993 for the three
months ended Sept. 30, 2005 from $174,569 for the three months
ended Sept. 30, 2004. Revenues decreased by $115,410 or 22% to
$404,385 for the nine months ended Sept. 30, 2005 from $519,795
for the nine months ended Sept. 30, 2004. The decrease in
revenues was primarily due to the decrease in demand of the
company's e-tailer products as a result of budget cuts in the
airline and train industries, and to the decrease in demand of the
business consulting service.
At Sept. 30, 2005, the company had cash and cash equivalents of
$26,953, a decrease of $66,795 from Dec. 31, 2004 primarily due to
cash consumed in operations of $3,247,754 and purchase of property
and equipment of $157,891 offsetting by proceeds received from
equity transactions of $3,338,850. The company's total capital
lease obligations were $53,201 at Sept. 30, 2005.
Going Concern Doubt
Spector & Wong, LLP expressed substantial doubt on the company's
ability to continue as a going concern after it audited the
company's financial statement for the fiscal year ended Dec. 31,
2004. The auditing firm points to the company's operating losses
and working capital deficiencies.
In its latest Form 10-Q filing, the company discloses that it
closed down its loss generating businesses, and continued to
evaluate and implement cost cutting measures at every entity
level. However, for the nine months ended Sept. 30, 2005, the
Company continues to experience a negative cash flow from
consolidated operations, and projects that it will need certain
additional capital to enable it to continue operations at its
current level beyond the near term.
The Company believes that certain of this needed capital will
result from the successful collection of its accounts receivable
balances as the manufacturing plant is fully operating during the
coming fiscal year. The Company believes it can raise additional
funds through private placements of its common stock.
Founded in May 1994, Circle Group Holdings, Inc., f/k/a Circle
Group Entertainment Ltd. had no business operations except for
research and development activities between May 1994 and January
1997. In 2002, the company reorganized its business units into
three reportable segments: food product development, security
product development, and e-tailor, and acquired FiberGel
Technologies, Inc., which owns an exclusive license to Z-Trim, an
all-natural, corn and other grain-based fat replacement.
The company has four operating subsidiaries: FiberGel
Technologies, Inc., thebraveway.com, Inc., operating as The Brave
Way Training Systems, On-Line Bedding Corp., and Z-Amaize
Technologies, Inc., and has exclusive worldwide licenses to the
Nutrition Analysis Tool website, Mini-Raman Lidar System, and
ThraxVac technology.
CIRTRAN CORP: Reports Third Quarter 2005 Financial Results
----------------------------------------------------------
Cirtran Corp. delivered its financial statements for the quarterly
period ended Sept. 30, 2005, with the Securities and Exchange
Commission on Nov. 14, 2005.
For the three months ended Sept. 30, 2005, the company reports
$575,042 in net income on $4.3 million in revenues, compared to a
$552,086 net loss on $2.6 million in revenues for the same period
in 2004.
At Sept. 30, 2005, the company's balance sheet showed a
$2.9 million in positive equity, compared to a $2.2 million
deficit at Sept. 30, 2004.
Going Concern Doubt
The company has $377,357 cash on hand at Sept. 30, 2005. Because
the company has negative cash flows from operations, it must rely
on other cash sources. The company anticipates that various
methods of equity financing will be required to support its
operations until cash flows from operations are positive.
As reported in the Troubled Company Reporter on April 19, 2005,
Hansen, Barnett & Maxwell, CirTran's accountants, raised
substantial doubts about the Company's ability to continue as a
going concern after it audited the Company's financial statements
for the fiscal year ended Dec. 31, 2004, citing continuing losses
and negative cash flows from operations, and pointing to the
company's accumulated deficit, equity deficit and working capital
deficit.
Default
As of Sept. 30, 2005, the company was in default of its
obligations under a settlement agreement with Sunborne XII, LLC.
The company, as successor to Circuit TEchnology, Inc., was a
defendant in an action brought by Sunborne in El Paso County,
Colorado District Court, for alleged breach of a sublease
agreement involving facilities located in Colorado.
"Our liability in this action was originally estimated to range up
to $2.5 million, and we subsequently filed a counter suit in the
same court against Sunborne in an amount exceeding $500,000 for
missing equipment," Iehab J. Hawatmeh, the company's President and
Chief Financial Officer said.
Pursuant to a settlement agreement, the company is required to pay
$250,000 to Sunborne along with 8% interest. The Company is
continuing to negotiate with Sunborne in an attempt to settle its
remaining obligation.
Founded in 1993, CirTran Corp. -- http://www.CirTran.com/-- is a
premier international full-service contract manufacturer of low to
mid-size volume contracts for printed circuit board assemblies,
cables and harnesses to the most exacting specifications.
Headquartered in Salt Lake City, CirTran's modern 40,000-square-
foot non-captive manufacturing facility -- the largest in the
Intermountain Region -- provides "just-in-time" inventory
management techniques designed to minimize an OEM's investment in
component inventories, personnel and related facilities, while
reducing costs and ensuring speedy time-to-market.
CLYDESDALE CBO: Moody's Lifts $47 MM Class B Notes' Rating to Ba2
-----------------------------------------------------------------
Moody's Investors Service upgraded its rating of this class of
notes issued by Clydesdale CBO I Ltd., a collateralized debt
obligation issuance:
1) $47,000,000 Senior Secured Class B Fixed Rate Notes Due 2011
from Caa1 on watch for possible upgrade to Ba2 no longer on
watch for possible upgrade.
Moody's noted that the transaction, which closed in March of 1999,
has experienced improvement in overcollateralization due to
amortization of the senior CDO liabilities. The rating of the
Class B Notes was placed on the Moody's watchlist for possible
upgrade on October 21, 2005.
Moody's stated that the rating assigned to the Class B Notes,
prior to the rating action taken, is no longer consistent with the
credit risk posed to investors.
Issuer: Clydesdale CBO I, Ltd.
The rating of this class of notes has been upgraded:
Class Description:
* U.S. $47,000,000 Senior Secured Class B Fixed Rate Notes
Due 2011 from Caa1 on watch for possible upgrade to Ba2 no
longer on watch for possible upgrade.
COOPER COMPANIES: Moody's Reviews $750 Million Debts' Ba3 Ratings
-----------------------------------------------------------------
Moody's Investors Service placed the ratings of The Cooper
Companies, Inc. (Corporate Family and senior secured at Ba3) on
review for possible downgrade reflecting lower free cash flow and
debt reduction expectations following the company's recent
downward revision of its sales and earnings guidance and
moderately-sized, debt financed acquisitions.
Ratings placed under review for possible downgrade:
* Corporate family rating -- Ba3
* $275 Million 5-Year Senior Secured Revolving Credit Facility
-- Ba3
* $225 Million 5-Year Senior Secured Term Loan A -- Ba3
* $250 Million 7-Year Senior Secured Term Loan B -- Ba3
Moody's has affirmed the company's SGL-2 speculative grade
liquidity rating.
Moody's review will focus on the company's ability to improve free
cash flow in light of increased competitive pressures in certain
segments of Cooper's soft contact lens business and the higher
capital expenditure needs over the next several years. The review
will also consider the company's debt reduction strategy and
examine the impact of existing and potential future acquisitions
on Cooper's financial flexibility and whether such acquisitions
amplify management distractions.
Moody's notes, that on November 21, 2005 Cooper reduced its fiscal
2005 to 2007 sales and earnings guidance, largely because of
increased competitive pressures in the company's two-week
spherical lens business and exchange rate related factors.
Moody's anticipates that Cooper will generate minimal free cash
flow in fiscal 2006, reflecting approximately $150 million in
capital expenditures related to expansion of manufacturing
capacity, well above levels anticipated when we affirmed the
company's ratings in June 2005.
The Cooper Companies, Inc., headquartered in Pleasanton,
California, manufactures and markets soft contact lenses
worldwide. The company also manufactures:
* diagnostic products,
* surgical instruments, and
* accessories for women's healthcare.
For the twelve months ended July 31, 2005, the company generated
approximately $717 million of revenues.
DELPHI CORP: Wants to Hire Wilmer Cutler as Special Counsel
-----------------------------------------------------------
Marjorie H. Loeb, assistant secretary of Delphi Corporation,
relates that since 2004, the Securities and Exchange Commission
and other government authorities have been investigating Delphi's
accounting and adequacy of disclosures for a number of
transactions, which include ones in which Delphi received rebates
or other lump-sum payments from suppliers, certain off-balance
sheet financings of indirect materials and inventory, and the
0payment in 2000 of $237,000,000 in cash, and the subsequent
receipt in 2001 of $85,000 in credits, as a result of certain
settlement agreements entered into between Delphi and General
Motors.
The Audit Committee of the Company's Board of Directors, Ms. Loeb
continues, undertook to examine the circumstances giving rise to
the SEC Investigation and to take related appropriate actions,
including disciplinary actions against certain employees and
communicating and cooperating fully with the SEC and other
government authorities.
Delphi employed Wilmer Cutler Pickering Hale and Dorr LLP to
represent the Audit Committee in matters relating to the SEC
Investigation under the terms of an engagement letter dated
August 24, 2004. In connection with the SEC Investigation, the
firm has reviewed documents, interviewed relevant personnel,
advised the Audit Committee and the Board of Directors,
communicated with the SEC and other authorities, and performed
related tasks. Thus, the firm has become familiar with the
factual and legal issues relevant to the SEC Investigation.
The Debtors ask the U.S. Bankruptcy Court for the Southern
District of New York for authority to employ Wilmer Cutler as
special regulatory counsel to the Audit Committee, nunc pro tunc
to Oct. 7, 2005, with respect to the SEC Investigation in the
Debtors' Chapter 11 cases.
As special regulatory counsel, Wilmer Cutler will:
(a) review documents, interview relevant personnel, and
report to the Audit Committee and Delphi's Board of
Directors regarding the SEC Investigation;
(b) advise the Board of Directors on securities law and other
issues relating to the SEC Investigation; and
(c) advise and assist the Debtors in meetings and
communications with the SEC and other regulators and
governmental authorities.
The Debtors will pay Wilmer Cutler at its standard hourly rates,
subject to periodic adjustments:
Partners $425 - $815
Junior Partners $420 - $515
Counsel $400 - $600
Associates $270 - $470
Attorneys/Specialists $220 - $405
Paraprofessionals $80 - $245
Charles Davidow, Esq., a partner at Wilmer Cutler, informs the
Court that the firm has in the past represented, currently
represents, and will likely in the future represent certain
creditors and other parties-in-interest in matters unrelated to
the Audit Committee or the Debtors or their cases. Mr. Davidow
does not believe that this will raise any actual or potential
conflict of interest relating to the firm's engagement as special
regulatory counsel in the Debtors' cases.
To vitiate any actual or potential conflicts of interest, Wilmer
Cutler, Mr. Davidow says, will not assist the Audit Committee or
the Debtors in connection with their analysis, negotiations, and
litigation, if any, with parties with whom the firm has existing
client relationships.
The firm will also coordinate with the Debtors' other
professionals so as not to duplicate their services.
Wilmer Cutler, Mr. Davidow avers, does not represent or hold any
interest adverse to the Audit Committee or the Debtors or their
estates with respect to the matters on which the firm is to be
employed.
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. (Delphi
Bankruptcy News, Issue No. 9; Bankruptcy Creditors' Service, Inc.,
215/945-7000)
DELPHI CORP: Wants to Hire Jones Lang as Real Estate Advisors
-------------------------------------------------------------
Delphi Corporation and its debtor-affiliates ask the Honorable
Robert D. Drain of the U.S. Bankruptcy Court for the Southern
District of New York for authority to employ Jones Lang LaSalle
Americas, Inc., as their real estate administrative and
transactional services provider, nunc pro tunc to Nov. 3, 2005,
pursuant to a Real Estate Services Agreement dated Sept. 2, 2005,
as amended.
Karen Healy, vice president of corporate affairs, marketing
communications and facilities of Delphi Corporation, relates that
the Debtors require a qualified global real estate service
provider to maintain and administer more than 400 owned or leased
parcels of real property containing a total of 86,000,000 square
feet in nearly 40 countries worldwide. Currently, the Debtors do
not have the resources to perform either the real estate
administration or transactional services contemplated by the
Engagement Agreement.
"Historically, the Debtors have outsourced these activities," Ms.
Healy tells Judge Drain. "The previous real estate service
provider terminated its relationship with Delphi at the beginning
of November when its contract terminated."
JLL is a global integrated real estate services provider,
specializing in facility services, transactional services, and
lease administration. Its services include:
* advising companies in complex restructuring assignments
concerning the reduction of real estate operating and
occupancy costs;
* increasing operating efficiency of real estate assets; and
* advising on all real estate matters during restructuring,
reorganization, or liquidation efforts.
Notwithstanding JLL's restructuring experience, the Debtors had
decided to retain the firm prior to October 8, 2005, to provide
them with real estate administration services and advice. Thus,
the Debtors believe that the firm is well qualified to serve as
their real estate services provider to perform certain services
that will be necessary for the duration of their Chapter 11
cases.
Pursuant to the Engagement Agreement, JLL will:
(a) maintain the Debtor's real property information database
containing key data of all owned and leased locations;
(b) coordinate all leased real estate related payables
including rent and property tax payments;
(c) issue notice and recommendations relating to notice
provisions, expiration dates, or other dates for action by
the Debtors;
(d) perform an initial evaluation and abstract of all real
property interests and provide strategic planning
services;
(e) provide leasing, subleasing, lease termination, or other
lease disposition services;
(f) provide real property purchase and sale services;
(g) assist with all facility planning and strategy; and
(h) provide field review of each location, analysis of market
costs, and comparison of lease rates by facility.
JLL will charge the Debtors for the costs of the salaries of all:
(i) administrative personnel plus an overhead allocation
profit factor equal to 75% of the salaries or $16,375 per
month, with a one time set-up fee of $27,000;
(ii) transaction services personnel, excluding bonuses,
benefits, and payroll taxes, in accordance with a salary
schedule acceptable to Delphi plus an overhead allocation
profit factor equal to 55% of the transactional services
salaries or $46,000 per month.
JLL will also receive a fee commission for leasing/subleasing,
sales, purchases, expansions, and renewals that would be subject
to customary market commissions, provided, however, that in no
event will the fee commission exceed the required commission cap
scale.
JLL has agreed to give the Debtors a discount on the fee
commissions based on the revenue sharing procedure described in
the Engagement Agreement and the revenue sharing schedule.
The Debtors have agreed to reimburse JLL's actual and reasonable
out-of-pocket costs and expenses incurred in connection with its
services.
James Becker, a member of JLL, assures the Court that the firm:
-- does not have any connection with the Debtors, their
creditors, or any other party-in-interest;
-- is a "disinterested person" under Section 101(14) of the
Bankruptcy Code and as required under Section 327(a); and
-- does not hold or represent an interest adverse to the
Debtors' Chapter 11 estates.
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. (Delphi
Bankruptcy News, Issue No. 9; Bankruptcy Creditors' Service, Inc.,
215/945-7000)
DELPHI CORP: BofA Wants Adequate Protection Under Aircraft Leases
-----------------------------------------------------------------
Bank of America, N.A., asks The Honorable Robert D. Drain of the
U.S. Bankruptcy Court for the Southern District of New York to:
(1) grant adequate protection of its interests in collateral
relating to two aircraft being leased to Delphi Automotive
Systems Human Resources, LLC, including the grant of
replacement liens in any similar, after-acquired
collateral, including cash collateral; and
(2) terminate the automatic stay and direct Delphi Corporation
and its debtor-affiliates to immediately turn over the
Cash Collateral to Bank of America immediately upon
receipt.
Learjet Lease
Patrick E. Mears, Esq., at Barnes & Thornburg LLP, in Grand
Rapids, Michigan, relates that on March 30, 2001, Bank of
America's predecessor-in-interest, Fleet National Bank, entered
into an Aircraft Lease with Delphi HR's predecessor-in-interest,
SM 5105 LLC, as lessee, for a 144-month lease term beginning on
December 20, 2001, and expiring on December 19, 2013.
Personal property under the Learjet Lease include:
(a) a Learjet 60 aircraft bearing U.S. Registration Mark
N699DA and manufacturer's Serial No. 237;
(b) two Pratt & Whitney Canada model number PW305A aircraft
engines bearing manufacturer's Serial Nos. PCE-CA0319 and
PCE-CA 0318; and
(c) all present and future parts, avionics, accessories,
accessions and attachments related to the Learjet
Aircraft, the Learjet Engines and any related goods,
including all present and future replacements,
substitutions and exchanges.
Bank of America, as successor-in-interest to Fleet National,
holds the title to the Learjet Aircraft, the Learjet Engines and
the Learjet Accessories and Avionics. The lessor's cost of the
Learjet amounted to $11,125,200.
Pursuant to the Learjet Lease, SMLLC, Mr. Mears says, is required
to pay to Bank of America "Basic Rent" and "Supplemental Rent."
Each monthly installment of Base Rent under the Learjet Lease is
$64,203 for months 1 through 72 and $78,471 for months 73 through
144, subject to a "Rate Reset" at the 96th Month of the Lease.
All of SMLLC's obligations under the Learjet Lease are
unconditionally guaranteed by Delphi Corporation, formerly known
as Delphi Automotive Systems Corporation, and Delphi Automotive
Systems LLC, pursuant to the terms of four separate guaranties,
all of which are dated March 30, 2001, as amended.
Pursuant to the terms of the Learjet Lease and two separate
Consents to Aircraft Management Agreement and Charter Agreement
and Assignment executed by Fleet National, SMLLC, Pentastar
Aviation, LLC, and Automotive Air Charter, Inc., dated Nov. 27,
2001, and December 16, 2003, SMLLC and Delphi HR granted to Fleet
a first priority security interest in, inter alia, all of SMLLC's
rights under the Management Agreement and the Learjet Charter
Agreement and any subleases of the Learjet aircraft, including
any sums paid and payable to SMLLC. This security interest was
perfected under applicable non-bankruptcy law.
"The Learjet is being chartered on a frequent basis to third
parties and, as a result of these charters, cash revenues are
being paid to the Debtors," Mr. Mears informs the Court. "These
cash revenues constitute 'cash collateral,' within the meaning of
Section 363(a) of the Bankruptcy Code in which Bank of America
holds a first priority security interest."
Neither the Learjet Charter Agreement nor the Management
Agreement have been rejected or terminated.
Challenger Lease
On March 30, 2001, Fleet National entered into an Aircraft Lease
with SMLLC, as lessee, covering:
(a) a Bombardier Inc. CL-600-2B16 (Variant 604) aircraft
bearing U.S. Registration Mark N599DA and manufacturer's
Serial No. 5498;
(b) two General Electric CF 34-3B aircraft engines bearing
manufacturer's Serial Nos. 873033 and 873034; and
(c) all present and future parts, avionics, accessories,
accessions and attachments related to the Challenger
Aircraft, the Challenger Engines and any related goods,
including all present and future replacements,
substitutions and exchanges.
Bank of America, as successor-in-interest to Fleet National,
holds title to the Challenger Aircraft, the Challenger Engines
and the Challenger Accessories and Avionics. The lessor's cost
of the Learjet amounted to $24,149,760.
Pursuant to the Challenger Lease, SMLLC is required to pay to
Bank of America "Supplemental Rent" and "Base Rent," which must
be paid on the 20th day of each calendar month with the last
payment being due on November 20, 2013.
Each monthly installment of Base Rent is $130,476 for months 1
through 72 and $159,480 for the months 73 through 144, subject,
however, to a "Rate Reset" at the 96th month of the Lease.
Delphi Corporation and Delphi Automotive Systems LLC
unconditionally guaranteed all of SMLLC's obligations under the
Challenger Lease, pursuant to the terms of four separate
guaranties, all of which are dated as of March 30, 2001, as
amended.
On November 26, 2001, SMLLC and Charter executed a Charter
Agreement concerning the Challenger Aircraft, which was renewed
on January 2, 2002. SMLLC and Pentastar Aviation, LLC, also
executed a Management Agreement, which was thereafter renewed on
June 1, 2002, and on May 5, 2003.
On December 16, 2003, SMLLC assigned all of its rights in the
Challenger Lease and related documents to Delphi HR pursuant to
the terms of an Aircraft Lease Assignment, Assumption and
Amendment Agreement that was recorded with the Federal Aviation
Administration on February 18, 2004.
Pursuant to the terms of the Challenger Lease and the Assignments
of Related Collateral, SMLLC and Delphi HR granted to Fleet
National a first priority security interest in, inter alia, all
of SMLLC's rights under the Management Agreement and the
Challenger Charter Agreement and in any subleases of the
Challenger Aircraft including any sums paid and payable to SMLLC.
This security interest, Mr. Mears reports, has been perfected
under applicable non-bankruptcy law.
According to Mr. Mears, the Challenger Aircraft is being
chartered on a frequent basis to third parties and, as a result
of these charters, cash revenues are being paid to the Debtors.
"These cash revenues constitute 'cash collateral' within the
meaning of Section 363(a) in which Bank of America holds a first
priority security interest."
Neither the Challenger Charter Agreement nor the Management
Agreement have been rejected or terminated, Mr. Mears says.
Adequate Protection
All administrative expenses due to Bank of America related to the
Learjet Lease and the Challenger Lease have been subordinated in
priority to administrative expenses due to the DIP Lenders, Mr.
Mears reminds Judge Drain. As a result, in the event of a
conversion of the Debtors' Chapter 11 cases to Chapter 7, there
is a possibility that Bank of America's claim for administrative
expenses will not be paid in its entirety.
To date, Delphi HR, Mr. Mears reports, has failed to pay
postpetition rent due on October 20, 2005, and November 20, 2005,
under the Learjet Lease and the Challenger Lease. The rent
arrearage resulting from these missed postpetition payments
presently amounts to $389,357.
As the holder of a security interest in the Learjet and
Challenger Cash Collateral, Bank of America, Mr. Mears asserts,
is entitled to receive adequate protection of those interests as
protection against any depreciation in value of its collateral
during the pendency of the Debtors' cases. Bank of America does
not consent to any use by the Debtors of the Cash Collateral.
As a measure of adequate protection, the Court, Mr. Mears
suggests, should at a minimum grant to Bank of America
replacement liens in all after-acquired property of the Debtors'
Chapter 11 estates of the same kind or nature as the property
serving as collateral for the obligations due to Bank of America
under the Learjet Lease and the Challenger Lease, including Cash
Collateral.
In addition, Mr. Mears continues, the Court should require the
Debtors to transmit to Bank of America periodic accountings of
all Cash Collateral generated after October 8, 2005, including
all revenues and proceeds of the Management Agreement, the
Learjet Charter Agreement, the Challenger Charter Agreement and
any subleases of the Challenger or the Learjet, through automatic
payments, equity cushion, additional or replacement liens, or
prospects for a successful reorganization.
Relief From Stay
Mr. Mears asserts that sufficient cause exists to terminate the
automatic stay and to require the payment of all Cash Collateral
to Bank of America upon the Debtors' receipt of the sums, for
these reasons:
(i) The amount of the Cash Collateral in the Debtors'
possession is less than the amount of the Postpetition
Rent Arrearage and the accelerated amount of all lease
obligations, and, therefore, the Debtors lack any equity
in the Property within the meaning of Section 362(d)(2)(A)
of the Bankruptcy Code;
(ii) The Cash Collateral is unnecessary to an effective
reorganization of the Debtors because the Property
constitutes an extremely small portion of the Debtors'
assets and is not subject to any liens or security
interests other than those held by Bank of America; and
(iii) The Debtors have failed to pay the $389,357 Postpetition
Rent Arrearage and have made no proposal to Bank of
America concerning payment of that amount.
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. (Delphi
Bankruptcy News, Issue No. 9; Bankruptcy Creditors' Service, Inc.,
215/945-7000)
DENALI CAPITAL: Moody's Withdraws Class B-2L Notes' Ba2 Rating
--------------------------------------------------------------
Moody's Investors Service withdrew the ratings on these classes of
notes issued by Denali Capital CLO II, Ltd.:
1) U.S. $270,000 000 Class A-1L Floating Rate Notes due
August 2014 (rated Aaa)
2) U.S. $18,500 000 Class A-2L Floating Rate Notes due
August 2014 (rated Aa2)
3) U.S. $30,000 000 Class A-3L Floating Rate Notes due
August 2014 (rated A2)
4) U.S. $13,000 000 Class B-1L Floating Rate Notes due
August 2014 (rated Baa2)
5) U.S. $9,000 000 Class B-2L Floating Rate Notes due
August 2014 (rated Ba2)
In addition, the rating on the U.S. $6,000 000 Class B-X
Combination Notes due August 2014 (rated Baa2) was also withdrawn.
According to Moody's, the ratings were withdrawn because the Notes
were redeemed in full on the Payment Date of November 21, 2005.
Denali Capital CLO II, Ltd. closed in July of 2002.
DIRECT INSITE: Balance Sheet Upside-Down by $2.97MM at Sept. 30
---------------------------------------------------------------
Direct Insite Corp. (OTC BB:DIRI.OB) reported revenue from
continuing operations increase 57.2% and 27.5% to $2,512,000 and
$6,910,000 respectively for the three and nine months ended
Sept. 30, 2005, compared to revenue from continuing operations of
$1,598,000 and $5,421,000 for the same periods in 2004.
Recurring revenues from EIP&P services increased 68.8% and 44.5%
to $1,695,000 and $4,284,000 for the three and nine months ended
September 30, 2005, compared to $1,004,000 and $2,965,000 for
the same periods in 2004, while recurring revenues from other
non-EIP&P services decreased by $128,000 and $399,000 for the
three and nine months ended September 30, 2005 compared to 2004.
Revenues from professional services increased 76.6% to $809,000
and 28.1% to $2,593,000 for the three and nine months ended
September 30, 2005, compared to $458,000 and $2,024,000 for the
same periods in 2004.
According to CEO and Chairman of the Board James A. Cannavino, the
results for the third quarter represent a major milestone for the
company. "We have successfully achieved significant revenue
growth while maintaining vigorous cost controls," Mr. Cannavino
said.
Direct Insite reported operating income of $75,000 for the
three-month period ended September 30, 2005, compared to an
operating loss of $481,000 for the same period of 2004. The
operating loss for the nine months ended September 30, 2005,
was reduced 66.9% to $306,000, compared to a loss of $925,000
for the nine months ended June 30, 2004.
Headquartered in Bohemia, New York, Direct Insite Corp. --
http://www.directinsite.com/-- employs a staff of 54. The
Company's IOL solution is deployed in North and South America,
Europe, Middle East, Africa and Asia-Pacific geographic areas.
As of September 30, 2005, Direct Insite's equity deficit widened
to $2,969,000 from a $2,537,000 deficit at December 31, 2004.
DIRECTED ELECTRONICS: Moody's Reviews B2 Credit Loan Rating
-----------------------------------------------------------
Moody's Investors Service placed the B2 corporate family rating
and B2 senior secured credit facility ratings of Directed
Electronics under review for possible upgrade following recent
operating performance improvements and expected repayment of its
subordinated notes with the proceeds expected to be received from
its anticipated IPO.
Ratings under review for possible upgrade include:
* Senior secured revolving credit facility at B2;
* Senior secured term loan at B2; and
* Corporate family rating at B2.
On November 16, 2005, Directed filed the second amendment to its
registration statement for common equity, the proceeds of which
are expected to be used to repay two subordinated notes
aggregating $74 million. If the IPO is completed under its
current terms, the company's corporate family rating and secured
credit facility (revolver and term loan) ratings will likely be
upgraded to B1 from B2.
The rating review will focus on the use of net proceeds from the
IPO, which Moody's expects to be applied to the repayment of
subordinated notes. The review will also incorporate the
improvement in Directed's operating results over the past year
with the acquisition of Definitive Technology and the exclusive
agreement to supply Sirius branded satellite radio receivers to
the retail channel, both of which have diversified the company's
product mix and are the principal drivers for future growth.
Directed's revenue increased almost 30% in the LTM ended Sept. 30,
2005, to roughly $245 million, driven principally by the
Definitive and Sirius businesses. Assuming the IPO closes under
its current terms and the company repays its $74 million of
subordinated notes, for the LTM ended September 30, 2005, the
company's leverage (adjusted debt/adjusted EBITDA) improves to
3.7x from 5.2x and its interest coverage during this period
improves to 3.8x from 2.2x. Debt and EBITDA are adjusted for the
capitalization of operating leases in accordance with Moody's
Global Standard Adjustments.
Directed Electronics, Inc., with corporate headquarters in Vista,
California, is a leading designer and manufacturer of consumer
branded vehicle security and convenience systems including such
recognized brands as Viper and Clifford. Directed is a major
supplier of car audio equipment, and designs and markets two
leading brands of home audio loudspeakers: Definitive Technology
and a/d/s, as well as a full line of mobile video entertainment
products, and the exclusive supplier of Sirius branded Satellite
Radio receivers in the retail channel. Directed's products are
sold and installed through a diverse distribution network that
includes over 3,400 retailers. Sales for the LTM ended September
2005 were approximately $245 million.
EMPIRE FINANCIAL: Earns $1.58 Million in Third Quarter 2005
-----------------------------------------------------------
Empire Financial Holding Company delivered its quarterly 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 a $1,583,636 of net income on $6,447,000
of net revenues for the quarter ending September 30, 2005. At
Sept. 30, 2005, the Company's balance sheet shows $6,395,082 in
total assets and $2,944,059 of positive stockholders equity.
A full-text copy of the regulatory filing is available at no
charge at http://ResearchArchives.com/t/s?332
Empire Financial Holding Company, through its wholly owned
subsidiary, Empire Financial Group, Inc., provides full-service
retail brokerage services through its network of independently
owned and operated offices and discount retail securities
brokerage via both the telephone and the Internet. Through its
market-making and trading division, the Company offers securities
order execution services for unaffiliated broker dealers and makes
markets in domestic and international securities. Empire
Financial also provides turn-key fee based investment advisory and
registered investment advisor custodial services through its
wholly owned subsidiary, Empire Investment Advisors, Inc.
* * *
Going Concern Doubt
The audit report contained in its Annual Report on Form 10-KSB for
the year ended Dec. 31, 2004, contains an explanatory paragraph
that raises doubt about the Company's ability to continue as going
concern because of losses from continuing operations in 2004, 2003
and 2002, a stockholders' deficit at the end of 2004 and
uncertainties relating to regulatory investigations.
FEDERAL-MOGUL: Court Approves $775M Amended DIP Credit Agreement
----------------------------------------------------------------
The Hon. Raymond T. Lyons of the U.S. Bankruptcy Court for the
District of Delaware authorizes Federal-Mogul Corporation and its
debtor-affiliates to enter into and perform obligations under
the Amended DIP Agreement, the Commitment Letter and the Fee
Letter. The Court also authorizes the Debtors to continue using
cash collateral and providing adequate protection.
The Debtors delivered to the Court their Amended DIP Credit
Agreement on Nov. 10, 2005.
Amended DIP Facility Term Sheet
Facility: The Amended DIP Facility will consist of:
a. $500,000,000 senior secured revolving
credit facility with a letter of credit
sublimit in at least the U.S. dollar
equivalent of $375,000,000; and
b. $275,000,000 senior secured Term Loan
Facility.
Maturity: a. Dec. 9, 2006; or
b. If earlier, the date of substantial
consummation of a plan of reorganization
for Federal-Mogul and its subsidiaries.
Purpose: Federal-Mogul and its subsidiaries will use
the Amended DIP Facility to:
a. repay obligations owed under the
Existing DIP Facility;
b. finance the U.K. Settlement Agreement;
c. fund the purchase or retention of the
Intercompany Loan Notes from the U.K.
Administrators pursuant to the U.K.
Settlement Agreement and among Federal-
Mogul and its subsidiaries; and
d. provide working capital and funds for
other general corporate purposes.
Administrative
Agent: Citicorp USA, Inc.
Sole Arranger
and Bookrunner: Citigroup Global Markets, Inc.
Lenders: A syndicate of financial institutions,
including Citigroup USA arranged by the
Arranger in consultation with Federal-Mogul
and its subsidiaries.
Priority
and Liens: The Lenders under the New Revolving Credit
Facility will have:
* first priority in repayment with respect
to current assets of Federal-Mogul and
its subsidiaries; and
* second priority in repayment with respect
to fixed assets of Federal-Mogul and
its subsidiaries.
The Lenders under the New Term Loan
Facility will have:
* first priority in repayment with respect
to fixed assets of Federal-Mogul and its
subsidiaries; and
* second priority in repayment with respect
to current assets of Federal-Mogul and
its subsidiaries.
To the extent no material adverse tax or
other financial consequences to Federal
Mogul and its subsidiaries would result,
the Loan Notes would be made available to
serve as collateral for the Lenders under
the Amended DIP Facility; provided that the
lenders will release any security interest
in the Loan Notes in the event that
Federal-Mogul and its subsidiaries
determine that to avoid material adverse
tax or other financial consequences to
Federal-Mogul and its subsidiaries, the
Loan Notes should be transferred to a
Federal-Mogul subsidiary that is not a
Borrower.
Adequate
Protection: Substantially similar to that under the
Existing DIP Facility with certain
modifications with respect to adequate
protection in favor of the Surety Bond
Issuers to reflect the Stipulation and
Agreement for the Compromise and Settlement
of Secured Surety Claims for Treatment
under Third Amended Joint Plan of
Reorganization and Related Matters approved
by the Bankruptcy Court on March 17, 2005.
Closing Date: The date of the initial funding of the
Amended DIP Facility
Interest Rates
and Fees: With respect to the New Revolving Credit
Facility, LIBOR plus 2.25% or Base Rate
plus 1.25%.
With respect to the New Term Loan Facility,
LIBOR plus 2.50% or Base Rate plus 1.50%.
Letter of credit participating fees,
processing fees and fronting fees will be
identical to those in the Existing DIP
Facility.
Commitment fee on unused amounts under the
New Revolving Credit Facility equal to
0.375%.
Representations
and Warranties,
Covenants, and
Events of
Default: Substantially similar to that under the
Existing DIP Facility.
Includes an affirmative covenant requiring
Federal-Mogul and its subsidiaries to
conduct an appraisal of their inventory by
an independent inventory appraisal firm by
March 31, 2006, which:
* is in desktop form;
* contains a similar level of detail as the
appraisal provided to the Administrative
Agent in 2004; and
* is satisfactory to the Administrative
Agent.
With modifications acceptable to Citigroup
USA and Federal-Mogul and its subsidiaries,
including to accommodate the transactions
contemplated by the U.K. Settlement
Agreement and transfers of the Intercompany
Loan Notes among Federal-Mogul and its
subsidiaries.
Financial
Covenants: The loan documentation will contain
financial covenants that are similar to
those contained in the Existing DIP
Facility, including maximum capital
expenditures and a minimum consolidated
EBITDA covenant, with threshold amount
contained in the covenants to be
determined.
Mandatory
Prepayments &
Commitment
Reductions: Substantially similar to that under the
Existing DIP Facility.
Conditions
Precedent: Customary conditions precedent to closing
other similar facilities and substantially
as set forth in the Existing DIP Facility,
including:
* the satisfaction of the Arranger and
Citigroup USA in their sole discretion,
the entry of a bankruptcy court order
approving the full amount of the Amended
DIP Facility and the granting of the
superpriority administrative claim status
and liens; and
* the execution and delivery of mutually
satisfactory definitive documentation for
the Amended DIP Facility on substantially
the same terms.
Receipt by Citigroup USA and Citigroup
Global Markets of an executed copy of a
Loan Note Agreement prior to any draw on
the New Term Loan Facility or New Revolving
Credit Facility where the purpose of the
draw is to fund the Top Up Offer, or the
issuance of a letter of credit in
connection with the draw.
The Amended DIP Agreement includes a number of modifications to
various covenants, events of default and other provisions aimed
at ensuring that the Debtors can implement the U.K. Global
Settlement Agreement, including submitting a Top Up Offer. Those
amendments will ensure that the Debtors have flexibility as
necessary to make and consummate the Top Up Offer in an optimal
fashion, including the ability to undertake any intermediate or
ancillary transactions in connection with the Top Up Offer and
the Loan Notes.
The Debtors also propose to include a number of discrete
provisions in the Amended DIP Agreement that would enable them to
utilize the available financing more effectively and more
accurately track the Debtors' present strategic business plan.
The specific amendments include:
* Allowances necessary to permit the merger of two of the
Debtors' affiliates in Italy for the purpose of
recapitalizing the operations of the Federal-Mogul group of
companies in that country;
* Covenant relief necessary to permit the transfer of the
stock of certain of the Debtors' Asian affiliates, other
than those owned by the United Kingdom, into a new holding
company incorporated in Mauritius, for the purpose of
enhancing the efficiency of those holdings;
* Provisions allowing the Debtors to outsource certain of
their inventory management and hold their inventory in
consignment arrangements proposed to be established at
certain of the Debtors' facilities;
* Specific carve-outs from certain of the covenants in the
Amended DIP Facility to permit the dissolution of dormant
entities within the corporate structure of the Federal-Mogul
group of companies;
* Allowing for the consolidation of the stock ownership of
certain foreign subsidiaries of the U.S. Debtors into an
indirect holding company subsidiary of Federal-Mogul
Corporation to simplify the corporate structure of the
Federal-Mogul group of companies and achieve a number of
efficiencies expected to result from that consolidation; and
* Permitting the Debtors to invest in an Asian business, which
they have determined offers long-term strategic benefits for
their business.
A full-text copy of the 135-page Credit and Guaranty Agreement is
available for free at http://ResearchArchives.com/t/s?32d
The Fee Letter
In return for Citigroup's commitment to fund the Amended DIP
Facility, the Debtors have agreed to pay non-refundable upfront
and facility fees to Citigroup. The Debtors will also pay
Citigroup administrative agency and collateral monitoring fees
per annum. The Debtors did not disclose the amount of the fees.
A full-text copy of Citigroup's Fee Letter is available at
http://bankrupt.com/misc/CUSA_Fee_Letter.pdf
A full-text copy of October 25 Commitment Letter is
available at http://bankrupt.com/misc/Commitment_Letter.pdf
Headquartered in Southfield, Michigan, Federal-Mogul Corporation
-- http://www.federal-mogul.com/-- is one of the world's largest
automotive parts companies with worldwide revenue of some US$6
billion. The Company filed for chapter 11 protection on Oct. 1,
2001 (Bankr. Del. Case No. 01-10582). Lawrence J. Nyhan Esq.,
James F. Conlan Esq., and Kevin T. Lantry Esq., at Sidley Austin
Brown & Wood, and Laura Davis Jones Esq., at Pachulski, Stang,
Ziehl, Young, Jones & Weintraub, P.C., represent the Debtors in
their restructuring efforts. When the Debtors filed for
protection from their creditors, they listed US$10.15 billion in
assets and US$8.86 billion in liabilities. At Dec. 31, 2004,
Federal-Mogul's balance sheet showed a US$1.925 billion
stockholders' deficit. At Mar. 31, 2005, Federal-Mogul's balance
sheet showed a US$2.048 billion stockholders' deficit, compared to
a US$1.926 billion deficit at Dec. 31, 2004. Federal-Mogul
Corp.'s U.K. affiliate, Turner & Newall, is based at Dudley Hill,
Bradford. (Federal-Mogul Bankruptcy News, Issue No. 98;
Bankruptcy Creditors' Service, Inc., 215/945-7000)
FEDERAL-MOGUL: Asbestos PD Committee Objects to U.K. Settlement
---------------------------------------------------------------
The Official Committee of Asbestos Property Damage Claimants
appointed in the chapter 11 cases of Federal-Mogul Corporation and
its debtor-affiliates objected to the Debtors' request to perform
obligations under the U.K. Global Settlement Agreement.
A full-text copy of the U.K. Global Settlement is available at no
cost at http://bankrupt.com/misc/UKGlobalSettlement.pdf
As reported in the Troubled Company Reporter on Oct. 26, 2005, the
Debtors and their debtor-affiliates based the United Kingdom asked
Judge Lyons to authorize, but not require, the Debtors to enter
into and perform their obligations under the U.K. Global
Settlement Agreement.
On Sept. 26, 2005, the Debtors reached an agreement with the
administrators of the U.K. Debtors, which would allow Federal-
Mogul to retain the businesses and other assets of its UK
affiliates in exchange for certain monetary amounts and reserves.
The U.K. Global Settlement Agreement
The U.K. Global Settlement Agreement, according to James E.
O'Neill, Esq., at Pachulski, Stang, Ziehl, Young, Jones &
Weintraub, in Wilmington, Delaware, is a comprehensive resolution
of disputes between the Plan Proponents and the Administrators as
to the reorganization of the U.K. Debtors. Those disputes, which
have centered on the valuation of and the law applicable to
asbestos personal injury claims and pensions-related claims
against the U.K. Debtors, have been a primary obstacle to
confirmation of the Plan and the successful conclusion of cross-
border plenary insolvency proceedings.
As a result of those disputes, the Administrators have for some
time been engaged in efforts to market and sell the assets and
businesses of the U.K. Debtors pursuant to U.K. insolvency laws.
In the view of all parties, the non-consensual liquidation of the
U.K. Debtors was less desirable than a coordinated and consensual
reorganization of the U.K. Debtors pursuant to the U.S. and U.K.
insolvency laws.
The U.K. Global Settlement Agreement resolves the parties'
disputes and thereby avoids the liquidation of the U.K. Debtors
and a clash of U.S. and U.K. jurisdictions, Mr. O'Neill says.
The U.K. Global Settlement Agreement thus removes a principal
obstacle to confirmation of the Plan and opens the path towards
the successful conclusion of the cross-border insolvency
proceedings.
The U.K. Global Settlement Agreement, in sum, provides for the
prompt and coordinated resolution of the U.K. administration
proceedings. Specifically, the Administrators have agreed to
propose and recommend schemes of arrangement or company voluntary
arrangements for the U.K. Debtors in accordance with the terms of
the U.K. Global Settlement Agreement.
The CVAs or Schemes, if approved by the requisite vote of
creditors in accordance with U.K. insolvency laws, will provide
for the resolution and treatment of most claims against the U.K.
Debtors with the notable exception of U.S., Canadian and certain
other "rest of world" current and future asbestos personal injury
claims against the U.K. Debtors and Intercompany Claims.
The resolution and treatment of the U.S. APICs will instead be
dealt with pursuant to the Plan and, specifically, the Section
524(g) asbestos trust to be created pursuant to the Plan, Mr.
O'Neill explains. For all other claimants against the U.K.
Debtors, the U.K. Global Settlement Agreement provides that they
will be entitled to the distributions they are to receive
pursuant to the CVAs or Schemes.
The U.K. Global Settlement Agreement provides for certain
reserves and payments to be established and made pursuant to the
CVAs or Schemes. These reserves and payments will be funded by:
(a) the substantial cash owned by the U.K. Debtors and
controlled, under the laws of the United Kingdom, by the
Administrators; and
(b) the proceeds of certain intercompany loan notes held by
T&N Limited.
Asbestos PD Committee Objection
For more than four years, the Debtors have taken advantage of the
protection under Chapter 11, including the automatic stay of
property damage claims that were pending on the Petition Date,
and the freedom from new lawsuits, Theodore J. Tacconelli, Esq.,
at Ferry, Joseph & Pearce, P.A., in Wilmington, Delaware,
asserts.
Specifically, Mr. Tacconelli points out that the Debtors:
-- were granted a bar date for property damage claims and have
had over two years to evaluate the claims received;
-- have utilized the claim objection process at least six
times to object to property damage claims before the
Bankruptcy Court; and
-- along with their other creditor constituencies, are taking
advantage of the channeling injunction under Section 524(g)
of the Bankruptcy Code to bar future asbestos personal
injury claims.
"While they have enjoyed all the benefits of Chapter 11, they now
try to avoid its burdens by asking the Court to abdicate its duty
to adjudicate claims objections in favor of a process that will
require property damage claimants to cross not just a continent
but an ocean to prove up their claims in the U.K.," Mr.
Tacconelli contends.
The Debtors have asked the Court to exercise its discretion and
defer, as a matter of comity, to a U.K. process that is dictated
by the terms of a settlement agreement, Mr. Tacconelli says.
"[That] agreement [was] reached through a process in which the PD
Committee did not participate and in fact was excluded from."
That exclusion from the negotiations was in direct contravention
of the Bankruptcy Court's direction at the December 20, 2004
hearing to involve the PD Committee in discussions with mediator
Francis McGovern currently ongoing regarding the English
companies, Mr. Tacconelli argues. "While counsel for the PD
Committee received a handful of calls from the Debtors and the
[Official Committee of Unsecured Creditors], these were mere
updates on the negotiations in the U.K. rather than a meaningful
engagement of the PD Committee in those negotiations."
The Debtors and the U.K. Administrators, along with the Plan
Proponents, are trying to achieve the inequitable result through
the mechanism of a Section 363(b) motion and not pursuant to a
plan of reorganization, Mr. Tacconelli contends. "They seek to
achieve through comity what they cannot achieve under the
Bankruptcy Code, effectively cherry-picking the benefits of
chapter 11 while casting aside the procedural and substantive
burdens."
Mr. Tacconelli argues that the U.K. Settlement Agreement should
not be approved for these five reasons:
1. It is an impermissible sub rosa plan of reorganization for
the U.K. Debtors and should not be approved absent
compliance with the requirements of Chapter 11;
2. It seeks to achieve through an improper invocation of the
principle of comity a result that is flatly impermissible
under the Bankruptcy Code;
3. It is an improper attempt to erect practical and legal
hurdles to property damage claims wherein they are not
likely to be pursued at all;
4. It provides for a claims reconciliation process for
property damage claimants that is patently unfair and
contrary to the requirements of Section 502; and
5. It confers a substantial benefit on Federal-Mogul
Corporation, the equity holder of T&N Limited, without
providing for full recovery to creditors of T&N Limited and
without disclosure of the price Federal-Mogul is paying for
the assets of the U.K. Debtors, the value of those assets,
or the alternatives to a sale to insiders.
Sub Rosa Plan
A sub rosa plan of reorganization is one in which the debtor and
the other joining parties attempt to bypass the protections
provided by Chapter 11 and set the terms of a plan of
reorganization outside of the strictures of the confirmation
process, Mr. Tacconelli explains.
The Debtors and the U.K. Administrators have asked the Court to
approve the U.K Settlement Agreement and agree that comity will
permit the company voluntary arrangements or schemes for the U.K.
Debtors to proceed in the U.K., including distributions of
recoveries to claimants.
Since the U.K. Debtors will remain debtors under Chapter 11, a
plan of reorganization will still be required for confirmation,
Mr. Tacconelli points out. However, according to the Comity
Motion, that plan will merely provide that comity is granted to
the CVAs or Schemes in the U.K.
In other words, approving the Comity Motion is tantamount to
setting the terms of the Plan, Mr. Tacconelli says. "By pre-
determining the terms of the plan of reorganization, the Comity
Motion, and the U.K. Settlement Agreement embodied within it,
constitute an impermissible sub rosa plan of reorganization."
Comity Should Not Be Extended to U.K. Settlement
The U.K. Global Settlement Agreement expressly provides that
"[Asbestos property damage] claims against T&N [will] be
exclusively subjected to the U.K. proving process and such of
those claims (if any) as are admitted [will] be paid a set
dividend equal to the dividend payable to general unsecured
creditors. . . ."
That's the fundamental problem with the U.K Settlement Agreement,
Mr. Tacconelli says.
The PD Claims will be paid from a $5,500,000 reserve established
by the U.K. Administrators. If the aggregate amount payable to
Property Damage Claimants exceeds the reserve, Federal-Mogul will
indemnify the U.K. Group Companies for the coverage, Mr.
Tacconelli notes. Thus, Federal-Mogul bears the financial risk
of making all required distributions to Property Damage Claimants
in excess of $5,500,000.
The U.K. Global Settlement Agreement further provides that
Federal-Mogul will cooperate with the U.K. Administrators in
connection with the property damage claim process and expressly
reserves for Federal-Mogul the right to be heard in any U.K.
legal proceedings concerning those claims.
"These provisions mean that the individuals, school districts,
municipalities, hospitals, and governmental agencies who allege
their buildings located in the U.S. are contaminated with
asbestos-containing materials manufactured or distributed by T&N
will have to prove up their claims in England, in accordance with
U.K. insolvency law and procedure, in proceedings where Federal-
Mogul Corporation and the U.K. Administrators will work together
to defend against those claims," Mr. Tacconelli says.
The Debtors and the U.K. Administrators suggest that the process
represents a "sensible solution" that affords "fundamental
fairness" to creditors of the U.K. Debtors. Mr. Tacconelli
contends that the U.K. Settlement Agreement is fundamentally
unfair to the Property Damage Claimants.
The purpose behind those provisions is transparent, Mr.
Tacconelli tells the Court. "[T]he Debtors and the U.K.
Administrators believe that it will be much harder and more
costly for U.S. Property Damage Claimants to pursue their claims
in the U.K. -- so much harder and more costly that many claimants
with modest damages are not likely to pursue their claims at all.
So, they have agreed among themselves to a change of forum for
the eventual adjudication of those claims, and now attempt to get
[the Bankruptcy Court] to bless their choice -- one that plainly
violates U.S. bankruptcy law -- as a matter of international
comity."
Comity is merely the recognition which one nation allows to the
legislative, executive, or judicial acts of another, having due
regard both to international duty and convenience, and to the
rights of its own citizens, or of other persons who are under the
protection of its laws, Mr. Tacconelli reminds the Court. The
principle of comity has never meant categorical deference to
foreign proceedings. Implicit in the concept is the idea that
deference should be withheld where appropriate to avoid the
violation of the laws, public policies, or rights of the citizens
of the United States.
No Conflict Between U.S. & U.K. Laws
Mr. Tacconelli relates that the Debtors and the U.K.
Administrators asked the Court that comity should be granted
because:
1. there are "true conflicts" between U.S. and U.K. insolvency
law and procedure;
2. the U.K. Debtors are incorporated under the laws of the
U.K., their businesses are primarily in the U.K., are
headquartered and managed in the U.K., their assets are
primarily in the U.K., and "most" of their creditors are
located in the U.K.; and
3. the U.K. insolvency law is "generally recognized" as an
efficient and procedurally fair means of financial
reorganization and has as its foundation the same principal
purposes and policies as does Chapter 11.
There is no true conflict, Mr. Tacconelli argues. The only real
conflict that exists is one that was manufactured by the U.K.
Settlement Agreement itself -- the conflict between:
-- provisions of the U.S. Bankruptcy Code that provide claims
are presumptively allowed unless objected to and that
require the Bankruptcy Court to adjudicate objections; and
-- a provision in the U.K. Settlement Agreement which mandates
that the property damage claims be proved up in the U.K.
While there are some schematic differences between U.K. and U.S.
procedure with respect to the timing, process, and content of
U.S. plans of reorganization and U.K. company voluntary
arrangements, none of these represents an irreconcilable conflict
requiring complete deference to the U.K. process, Mr. Tacconelli
points out. Nor is there any conflict of laws that requires
deference to a U.K. adjudication process for property damage
claims.
None of the reasons proffered by the Debtors or the U.K.
Administrators demonstrates that it is appropriate for the Court
to defer to an agreed carve-up of the U.K. Debtors without first
ensuring that it complies with the basic requirements of
Chapter 11, Mr. Tacconelli says.
Bankruptcy Court Should Exercise Jurisdiction
In the alternative, the Debtors and U.K. Administrators have
asked the Bankruptcy Court to abstain from exercising its
jurisdiction over the U.K. Debtors on a limited basis pursuant to
Section 1334(c)(1) of the Judiciary Procedures Code.
Mr. Tacconelli argues that the request is improper because it
does not satisfy the elements for discretionary abstention. Mr.
Tacconelli asserts that the Bankruptcy Court has an independent
duty pursuant to Section 502 of the Bankruptcy Code to adjudicate
claims allowance issues for claims that have been validly filed
under Section 501. The Bankruptcy Court cannot merely pass that
responsibility off to another court, especially one that is
located in a foreign jurisdiction and applies foreign law.
Moreover, the Bankruptcy Court cannot confirm a plan of
reorganization without ensuring that the plan satisfies the
requirements of the Bankruptcy Code.
For these reasons, the PD Committee asks Judge Lyons to deny the
Comity Motion and consider the U.K. Settlement Agreement in
conjunction with a plan of reorganization proposed in accordance
with the substantive and procedural requirements of the
Bankruptcy Code.
Headquartered in Southfield, Michigan, Federal-Mogul Corporation
-- http://www.federal-mogul.com/-- is one of the world's largest
automotive parts companies with worldwide revenue of some US$6
billion. The Company filed for chapter 11 protection on Oct. 1,
2001 (Bankr. Del. Case No. 01-10582). Lawrence J. Nyhan Esq.,
James F. Conlan Esq., and Kevin T. Lantry Esq., at Sidley Austin
Brown & Wood, and Laura Davis Jones Esq., at Pachulski, Stang,
Ziehl, Young, Jones & Weintraub, P.C., represent the Debtors in
their restructuring efforts. When the Debtors filed for
protection from their creditors, they listed US$10.15 billion in
assets and US$8.86 billion in liabilities. At Dec. 31, 2004,
Federal-Mogul's balance sheet showed a US$1.925 billion
stockholders' deficit. At Mar. 31, 2005, Federal-Mogul's balance
sheet showed a US$2.048 billion stockholders' deficit, compared to
a US$1.926 billion deficit at Dec. 31, 2004. Federal-Mogul
Corp.'s U.K. affiliate, Turner & Newall, is based at Dudley Hill,
Bradford. (Federal-Mogul Bankruptcy News, Issue No. 97;
Bankruptcy Creditors' Service, Inc., 215/945-7000)
FORCE PROTECTION: Jaspers + Hall Raises Going Concern Doubt
-----------------------------------------------------------
Jaspers + Hall, PC, expressed substantial doubt about Force
Protection, Inc.'s ability to continue as a going concern after it
audited the Company's financial statements for the three month and
nine month periods ended Sept. 30, 2005. The auditing firm points
to the Company's losses and negative cash flow.
Third Quarter Results
Force Protection (OTCBB: FRPT) recorded $33,452,306 in total
company revenue for the first nine months of 2005. Revenue from
vehicle sales and associated spare parts for the third quarter
ending Sept. 30, 2005 was $9,303,526, against costs of goods of
$7,770,078, resulting in a 16% gross profit of $1,533,448.
The Company incurred total operating costs of $14,908,737 for the
three months ended Sept. 30, 2005, resulting in a net loss from
operations of $5,605,211.
"The quarterly loss from operations was anticipated," said acting
Chief Financial Officer Scott Ervin. "The company experienced a
temporary decline in vehicle deliveries as it substantially
completed production of its 2004 contract backlog during the
second quarter of 2005 and continued to ramp up its internal
processes for production and delivery of the $93 million Joint
Explosive Ordnance Rapid Response Vehicle contract with the United
States Marine Corps during the third quarter."
"This period has been a time of important expansion for Force
Protection," Mr. Ervin added. "The expenses incurred during the
third quarter, which include substantial amounts for materials and
parts to support the JERRV contract as well as those associated
with infrastructure build up, were necessary steps that will help
the company achieve its estimated production capacity of up to two
vehicles per day in 2006."
The Company's balance sheet showed $27,387,866 in total assets at
Sept. 30, 2005, and liabilities of $17,786,201.
For the nine-month period ending Sept. 30, 2005, Force Protection
had a starting cash balance of $2,264,406 and an ending cash
balance of $1,248,688, representing a decrease in cash of
$1,015,718.
To meet its cash needs during this period, the Company sold 15,800
shares of its Series D Convertible Preferred Stock for $15,800,000
and exercised the balance of $445,985 remaining under an Equity
Line of Credit facility originally entered into on Sept. 20, 2003
with Dutchess Private Equities Fund.
In July 2005 the Company entered into a secured Bridge Facility
Agreement with GC Financial Services, Inc. to provide short term
financing up to a maximum amount of $5,000,000. As of Sept. 30,
2005 the outstanding balance under such Facility was $3,000,000
leaving an unused balance of $2,000,000.
Marine Corps Contract
Force Protection inked a contract with the Marine Corps for four
Buffalo mine clearance vehicles during the third quarter, marking
the first time the vehicle will be used by this branch of the
military. The total contract is worth an estimated $3,852,026.
Delivery of these vehicles is expected during the fourth quarter
of 2005 and the first quarter of 2006.
Headquartered in Ladson, South Carolina, Force Protection, Inc. --
http://www.forceprotectioninc.com-- manufactures ballistic and
mine-protected vehicles through its wholly owned subsidiary.
These specialty vehicles are protected against landmines, hostile
fire, and Improvised Explosive Devices. The Company manufactures
its vehicles using proprietary technology derived from South
African vehicle development programs carried out from 1972 through
1994, and incorporates design developments into the vehicles to
improve their protection and functionality. Force Protection's
mine and ballistic protection technology is among the most
advanced in the world. The vehicles are manufactured outside
Charleston, S.C.
FRESH CHOICE: Bankruptcy Court Confirms Joint Chapter 11 Plan
-------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of California
in San Jose confirmed the First Amended Chapter 11 Plan of
Reorganization of Fresh Choice, Inc., on Oct. 21, 2005.
The joint Plan provides for the recapitalization of the Debtor by
the Plan sponsors, Crescent Real Estate Equities Limited
Partnership and Cedarlane Natural Foods, Inc., and the funding of
an Unsecured Creditor Contribution for the payment of unsecured
claims. Crescent is the holder of 100% of the Company's
Class B Preferred Stock. Cedarlane is a manufacturer and
distributor of both fresh and frozen foods with operations in
Northern and Southern California.
On the effective date of the Plan, Crescent and Cedarlane will
receive 100% of the new equity interests in the Reorganized Debtor
and will have the exclusive right to appoint new officers and a
new board of directors. Crescent anticipates appointing Jerry R.
Crenshaw, Jr., and Jeffrey L. Stevens to the Reorganized Debtor's
board of directors while Cedarlane anticipates naming Robert S.
Atallah, Jr., and George Hourani to the board.
Plan Funding
In addition to available cash, Crescent and Cedarlane will
contribute equity or obtain debt financing to allow the
Reorganized Debtor to consummate the terms and distributions
proposed in the Plan. The Plan sponsors intend to contribute at
least $3 million in new equity in the Reorganized Debtor.
Disbursing Agent
The Debtor's Official Committee of Unsecured Creditors has
designated Alfred H. Siegel, CPA, to be appointed as the
Disbursing Agent on the effective date.
Mr. Siegel will be responsible of disbursing the Unsecured
Creditor Contribution. He will receive 1-1/4% of the Unsecured
Creditor Contribution as service fee, plus all reimbursable
expenses associated with the distribution.
Treatment of Classified Claims
Each holder of an allowed Priority Employee Claim not employed
with the Debtor as of the effective date of the Plan will receive
full payment of the allowed claim from available cash on the later
of the effective date or the date upon which the Bankruptcy Court
enters a Final Order determining or allowing the claim.
The holder of the Fairfield Note, payable to the City of Fairfield
in the original principal amount of $120,000, will retain all
legal, equitable or contractual rights allowed under the terms of
the note.
Secured Claims
Outstanding amounts due and payable to Mid-Peninsula Bank under
the revolving credit agreement dated Oct. 5, 2001, will be paid in
full, on the effective date from available cash, unless otherwise
agreed by Mid Peninsula and the Debtor.
Mid Peninsula will retain all legal, equitable, and contractual
rights on account of contingent secured claims arising from the
issuance of the Mid Peninsula Letters of Credit. The bank issued
the letters of credit to secure the Debtor's contingent
obligations under workers' compensation insurance policies. Mid
Peninsula's contingent secured claim will be reduced by the amount
by which the plan sponsors successfully reduce the Debtor's
contingent obligations under the workers' compensation policies
and the amount of the reduction of the contingent obligations of
the workers' compensation insurers.
Mid-Peninsula's claim for attorneys fees will be paid in full from
available cash upon agreement by the Plan sponsors and the bank or
on orders from the Bankruptcy Court.
Holders of allowed secured claims, other than Mid Peninsula, will
be paid either through:
a) the turnover of collateral securing the claim;
b) a cash payment equal to the amount of the allowed secured
claim; or
c) the Reorganized Debtor's assumption of the underlying
obligations with respect to the secured claim.
Unsecured Claims
Each holder of an allowed unsecured claim will receive a pro rata
share of the Unsecured Creditor Contribution, minus plan expenses
incurred by the Committee and the Disbursing Agent relating to the
analysis, reconciliation, objection to and allowance of unsecured
claims as well as post-effective date expenses incurred by the
Committee and Disbursing Agent.
The Plan sponsors will fund the Unsecured Creditor Contribution
either through:
a) a $5.5 million disbursement to the fund on the effective
date; or
b) a $1.5 million cash infusion to the fund, supplemented by a
$4 million cash payment on or within 60 days after the
effective date.
In addition to the $5.5 million cash contribution, the Plan
proponents will issue a $2.5 million non-interest bearing note
payable to the Disbursing Agent, in trust for the benefit of
allowed unsecured Creditors. The note, secured by all of the
assets of the Reorganized Debtor, will be subordinated to any
secured debt incurred by the Reorganized Debtor not greater than
$7 million.
The Reorganized Debtor will make quarterly payments in the amount
of $50,000 per payment to the Disbursing Agent pursuant to the
Unsecured Creditor Note and will pay the any remaining balance due
under the note 24 months after the effective date.
Based on the estimated $8 million to $8.4 million of allowed
unsecured claims, the Debtors expect to pay unsecured claim
holders approximately 95% of their allowed claims. However, the
Debtor says that, depending on the outcome of litigation of the
allowance of claims, unsecured claim holders could receive full
payment of their claims.
Equity Holders
Series B Preferred interests, all held by Crescent, will be
reinstated on the effective date. The legal, equitable, and
contractual rights of the holders of Series B Preferred Interests
will be left unaltered.
Common Interests and any remaining Preferred Interests will be
terminated and cancelled on the effective date.
Payments due from Workers' Compensation Insurers' Claims will be
assumed by the Reorganized Debtor and will be paid in the ordinary
course of its business.
A copy of Fresh Choice's First Amended Chapter 11 Plan of
Reorganization is available for a fee at:
http://www.researcharchives.com/bin/download?id=051125210419
Headquartered in Morgan Hill, California, Fresh Choice, Inc. --
http://www.freshchoice.com/-- owns and operates a chain of more
than 40 salad bar eateries, mostly located in California. The
company filed for chapter 11 protection on July 12, 2004 (Bankr.
N.D. Calif. Case No. 04-54318). Debra I. Grassgreen, Esq., at
Pachulski, Stang, Ziehl, Young, Jones & Weintraub P.C. represents
the Debtor in its restructuring efforts. When the Debtor filed
for protection from its creditors, it listed $29,651,000 in total
assets and $14,348,000 in total debts.
GLYCOGENESYS INC: Losses & Deficits Trigger Going Concern Doubt
---------------------------------------------------------------
Glycogenesys, Inc., reported financial results for the quarter
ended Sept. 30, 2005.
The Company incurred a net loss applicable to common stock of
$2,347,129 for the three months ended September 30, 2005, versus
$2,799,576 for the three months ended September 30, 2004.
Glycogenesys incurred a net loss applicable to common stock of
$7,268,970 for the nine months ended September 30, 2005, compared
to $8,288,125 for the same period last year.
As of September 30, 2005, the Company's balance sheet showed a
$500,00 in stockholders' equity, $74,001 in working capital, and
$2.5 million of liabilities -- all coming due in the next year.
As of November 15, 2005, Glycogenesys had a stockholders' deficit
and a working capital deficit because it failed to raise
additional capital.
The Company's future is dependent upon its ability to quickly
obtain financing to fund operations. As of November 15, 2005,
other than the common stock purchase agreement with Fusion Capital
Fund II, LLC, the Company hadnot obtained commitments from
existing or potential investors to provide additional financing.
Going Concern Doubt
Deloitte & Touche LLP expressed substantial doubt about
GlycoGenesys' ability to continue as a going concern after it
audited the company's financial statements for the fiscal year
ended Dec. 31, 2004. The auditing firm points to the company's
recurring losses from operations, accumulated deficit of
$94.5 million as of Dec. 31, 2004, and the Company's expectation
that it will incur substantial additional operating costs for the
foreseeable future. The Company received a similar opinion from
its independent auditors for the past four years.
About GlycoGenesys, Inc.
GlycoGenesys, Inc. -- http://www.glycogenesys.com/-- is a
biotechnology company focused on carbohydrate-based drug
development. The Company currently is conducting a Phase I dose
escalation trial of GCS-100LE, a unique compound to treat cancer,
in patients with solid tumors at Sharp Memorial Hospital, Clinical
Oncology Research in San Diego, California and the Arizona Cancer
Center at Tucson and at Scottsdale, Arizona. In addition, the
Company is conducting a Phase I/II dose escalation trial of GCS-
100LE in multiple myeloma at the Dana-Farber Cancer Institute in
Boston, Massachusetts. Further clinical trials are planned for
2005. The Company's headquarters are located in Boston,
Massachusetts with a laboratory in Cambridge, Massachusetts.
GRAND EAGLE: Creditors Committee Settles Dispute With Viacom
------------------------------------------------------------
The Official Committee of Unsecured Creditors of Grand Eagle,
Inc., and its debtor-affiliates ask the U.S. Bankruptcy Court for
the Northern District of Ohio, Eastern Division, to approve a
stipulation reducing Viacom, Inc.'s claim against the Debtors'
estates to $1 million.
Viacom had filed a $2.3 million general unsecured claim against
the debtors' estates for alleged actual and future environmental
cleanup costs associated with two of the Debtor's former
properties.
The Committee objected to the claim and Viacom subsequently filed
a reduced claim of approximately $2 million. Despite the
reduction, the Committee continued to dispute the claim. Its
contentions centered on:
-- the allocation of costs attributed to the Debtors by
Viacom in the reduced claim; and
-- the Debtors' liability for future, estimated clean-up
costs.
After extensive negotiations, Viacom agreed to reduce and limit
its allowed general unsecured claim against the Debtor's estate to
$1 million.
The Committee says the settlement is in the best interest of the
Debtors' estate given the risks and costs associated with
litigation.
Grand Eagle Companies, Inc., a privately held company, used to be
North America's largest independent motor, switchgear, and
transformer services provider. The Company filed for chapter 11
protection on December 7, 2001 (Bankr. N.D. Ohio Case No. 01-
54821). Subsequently, Grand Eagle sold all of its assets and is
no longer an operating business providing any goods or services
and no longer operates a business office. Jeffrey Baddeley, Esq.,
at Benesch Friedlander Coplan & Aronoff, represents the Debtors.
Jessica E. Price, Esq., at BROUSE McDowell represents the Official
Committee of Unsecured Creditors in these proceedings.
HONEY CREEK: Can Use of Cash Collateral to Maintain Operations
--------------------------------------------------------------
Honey Creek Kiwi, L.L.C., sought and obtained approval, on a final
basis, to access cash collateral securing repayment of
indebtedness to Municipal Mortgage Servicing, LLC.
Municipal Mortgage is the servicing agent for Bank One, Texas,
N.A., the indenture trustee under a $20,485,000 bond issuance by
the Texas Dept. of Housing and Community Affairs. The service
agent asserts a first priority lien and security interest in
substantially all of the Debtor's assets.
The Debtor needs the encumbered fund to pay its necessary
operating expenses, employee wages, vendors and suppliers and meet
other on-going business obligations in order to preserve the going
concern value of the estate.
To protect the lender against the diminution of its interest,
Municipal Mortgage will be given replacement liens on all of the
Debtor's assets.
Headquartered in Mesquite, Texas, Honey Creek Kiwi LLC, filed for
chapter 11 protection on August 24, 2005 (Bankr. N.D. Tex. Case
No. 05-39524). Richard G. Grant, Esq., at Roberts & Grant, P.C.,
represents the Debtor in its restructuring efforts. When the
Debtor filed for protection from its creditors, it estimated
assets and debts between $10 million and $50 million.
IBSG INT'L: Earns $278K of Net Income in Third Quarter
------------------------------------------------------
IBSG International, 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, IBSG International
earned $277,802 of net income, compared to $198,424 of net income
for the same period in 2004. The Company reported an increase in
sales revenues for the three months ended Sept. 30, 2005 to
$1,379,537 compared to sales revenues for the three months ended
Sept. 30, 2004 of $1,017,147.
The Company's balance sheet showed $8.9 million in total assets at
Sept. 30, 2005, and liabilities of $1.5 million. The Company has
incurred cumulative operating losses through Sept. 30, 2005 of
$2.3 million. Revenues had not been sufficient to cover its
operating costs and to allow it to continue as a going concern.
The potential proceeds from the sale of common stock, other
contemplated debt and equity financing, and increases in operating
revenues from new development would enable the Company to continue
as a going concern.
In March 2005, IBSG International addressed its capital
requirements by selling $1 million of Senior Secured Convertible
Notes. The notes are senior to any and all indebtedness of the
Company except for a bank line currently being negotiated for up
to $500,000 and will be secured substantially by all assets of the
Company and its subsidiaries.
Going Concern Doubt
HJ & Associates, LLC, expressed substantial doubt about IBSG
International's 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 significant losses from operations and insufficient
revenues to support operational cash flows.
Based in Celebration, Florida, IBSG International --
http://www.ibsgi.com/-- through its subsidiaries, operates as a
software provider, system integrator, and application service
provider. The company, through its subsidiary, Intelligent
Business Systems Group, Inc., licenses its digital service center
software, which provides a range of digital budgetary and
administrative, as well as commercial service applications, such
as B2B, e-commerce, government to business, and enterprise
business services on a single platform, known as the Biz World
Pro. It provides its services to state small business development
centers, business associations, and Fortune 1000 companies. The
company's other subsidiary, Secure Blue, Inc., provides a
Sarbanes-Oxley compliant and security software called Secure Blue
Pro. Its other subsidiary, Intelligent Business Systems
Development, Inc. operates as a software development, maintenance,
and data storage company. In addition, the company has a joint
venture with The Knowledge Institute of New Hampshire to develop a
product called myVBI, which utilizes BizWorldPro as its core and
provides approximately 1000 small business services supporting the
concept of a virtual business incubator.
ILINC COMMS: Posts $521,000 Net Loss in Quarter Ending Sept. 30
---------------------------------------------------------------
ilinc Communications Inc. delivered its quarterly 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 a $521,000 net loss on $3,005,000
of total revenues for the quarter ending Sept. 30, 2005.
At Sept. 30, 2005, the company's balance sheet shows
$16,272,000 in total assets and $12,246,000 in total debts.
Liquidity Problem
As of Sept. 30, 2005, the company had a working capital deficit of
$3.7 million.
A full-text copy of the regulatory filing is available at no
charge at http://ResearchArchives.com/t/s?330
Going Concern Doubt
Epstein, Weber & Conover, PLC, expressed substantial doubt about
iLinc Communications' ability to continue as a going concern after
it audited the company's financial statements for the fiscal year
ended March 31, 2005. The auditors point to the company's
significant working capital deficiency, substantial recurring
losses and negative cash flows from operations.
iLinc Communications, Inc. -- http://www.iLinc.com/-- develops
conferencing products and services for highly secure and cost-
effective collaborative online meetings, presentations, and
training sessions. The Company provides integrated Web and audio
conferencing as a Web-based service, onsite installable software,
or through hybrid ownership licensing in which customers pay a
one-time fee for unlimited conferencing yet the software is hosted
by iLinc. Its products and services include the iLinc suite of
Web Conferencing software (MeetingLinc, LearnLinc, ConferenceLinc,
and SupportLinc); Phone (Audio) Conferencing Services; On-Demand
Conferencing; and EventPlus, a service for professionally managed
online and audio conferencing events. iLinc's products and
services are used by organizations worldwide in sales, HR and
training, marketing, and customer support.
INDUSTRIAL ENTERPRISES: Financial Restatements Prompt Filing Delay
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Industrial Enterprises of America, Inc.'s accountants and legal
advisors have determined that many of the liabilities that were on
the company's balance sheet were actually the liabilities of its
former subsidiary and should have been taken off of the company's
books.
Due to this development, the company disclosed that its
accountants require more time to prepare the financial statements.
While this is a short-term delay for the company, the net effect
of this accounting restatement should strengthen the company's
financial standing and improve the company's ability to operate
profitably. Industrial Enterprises anticipates filing its first
quarter numbers with the Securities and Exchange Commission in the
coming week.
Going Concern Doubt
Beckstead and Watts, LLP, has expressed substantial doubt about
Industrial Enterprises of America, Inc.'s ability to continue as a
going concern after it audited the company's financial statements
for the fiscal year ended June 30, 2005. The auditors issued the
opinion because "the company has had limited operations and [has]
not commenced planned principal operations."
Headquartered in New York, New York, Industrial Enterprises of
America, Inc. -- http://www.TheOtherGas.com/-- is a holding
Company with three operating subsidiaries, EMC Packaging, Unifide
Industries and Todays Way Manufacturing, LLC. EMC Packaging is
one of the largest worldwide providers of refrigerant gases,
specializing in converting hydroflurocarbon gases into branded and
private label refrigerant and propellant products as well as
packaging of "gas dusters" used in a variety of industries.
Unifide Industries markets and sells specialty automotive products
under proprietary trade names and private labels, and Todays Way
Manufacturing manufactures and packages the products sold by
Unifide Industries.
INLAND FIBER: Balance Sheet Upside-Down by $162 Mill. at Sept. 30
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Inland Fiber Group, LLC, 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, Inland Fiber reported a
$7,259,000 net loss on $4,163,000 of revenues, in contrast to a
$12,557,000 net loss on $3,569,000 of revenues for the same period
in 2004.
The Company's balance sheet showed $84,339,000 in total assets at
Sept. 30, 2005, and liabilities of $246,343,000, resulting in a
stockholders' deficit of $162,004,000.
Going Concern Doubt
Eisner, LLP, expressed substantial doubt about Inland Fiber's
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 receipt of a Notice of
Default and Acceleration in connection with the indenture
governing the $225 million of Senior Notes due in 2007.
In December 2003, the Indenture Trustee filed an action in the
Court of Chancery of the State of Delaware against the Company.
The complaint alleges that the Company violated the provisions of
the indenture by transferring certain assets to its affiliates,
the directors of the Company violated their fiduciary duty to the
Company and that the transfers of the assets were fraudulent
conveyances and subject to rescission.
Inland Fiber continues to deny the existence of an Event of
Default and in March 2005, filed an appeal of the Court's order
with the Supreme Court of the State of Delaware.
The indenture contain certain restrictive covenants that limits
the Company's ability to make cash distributions, incur additional
indebtedness, sell assets or harvest timber in excess of certain
limitations. Although the Company had been approached regarding
certain debt restructuring scenarios, the ongoing litigation with
the indenture Trustee has materially interfered with the Company's
ability to pursue a number of such scenarios.
Headquartered in Klamath Falls, Oregon, Inland Fiber Group, LLC,
owns 167,000 fee acres of timberlands and cutting rights on 68,000
acres of timberlands containing an aggregate amount of
merchantable timber volume of approximately 0.4 billion board
feet.
* * *
As reported in the Troubled Company Reporter on July 11, 2005,
Moody's Investors Service lowered the rating of Inland Fiber
Group, LLC's $225 million 9 5/8% senior secured notes to Ca from
Caa3. Moody's also lowered the company's senior implied and
issuer ratings to Ca from Caa3. Moody's said the outlook is
stable.
INSEQ CORPORATION: Reports Third Quarter Financial Results
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INSEQ Corporation delivered its quarterly report on Form 10-QSB
for the quarter ending Sept. 30, 2005, to the Securities and
Exchange Commission on Nov. 15, 2005.
The Company reported $39,467 of net income on $1,310,699
of net revenues for the quarter ending Sept. 30, 2005. At
Sept. 30, 2005, the Company's balance sheet shows $5,109,126 in
total assets and $944,227 stockholders equity.
The Company's external auditors -- Rosenberg, Rich, Baker,
Berman & Company -- raised going concern doubts after reviewing
the company's 2004 financial statements. The Company's management
echoed the same sentiment pointing to its:
* $1,307,300 net loss for the nine months ended Sept. 30, 2005;
and
* $111,589 cash balance at September 30, 2005.
A full-text copy of the regulatory filing is available at no
charge at http://ResearchArchives.com/t/s?334
INSEQ Corporation is 70% owned by GreenShift Corporation (OTC
Bulletin Board: GSHF), a business development corporation whose
mission is to develop and support companies and technologies that
facilitate the efficient use of natural resources and catalyze
transformational environmental gains.
INTEGRATED SECURITY: Sept. 30 Balance Sheet Upside-Down by $5 Mil.
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Integrated Security Systems Inc. delivered its quarterly report on
Form 10-QSB for the quarter ending Sept. 30, 2005, to the
Securities and Exchange Commission on Nov. 21, 2005.
The company reported a $1,392,013 net loss on $2,424,270 of net
revenues for the quarter ending Sept. 30, 2005. At Sept. 30,
2005, the company's balance sheet shows $9,147,682 in total assets
and $13,864,370 in total debts.
At Sept. 30, 2005, the company's balance sheet showed a
stockholders' deficit of $4,716,688, up 33% from the $3,541,147
deficit reported at Dec. 31, 2004.
The company's cash position increased by $333,271 during the
quarter ended Sept. 30, 2005. At Sept. 30, 2005, the company had
$638,766 in cash and cash equivalents. ISSI reports approximately
$1.8 million outstanding under its revolving credit facility.
Going Concern Doubt
Weaver and Tidwell, LLP, expressed substantial doubt about the
company's ability to continue as a going concern after it audited
the company's financial statements for the fiscal year ended
June 30, 2004. The auditors cited the company's significant
losses from operations for the year. The company received a
similar opinion from its previous auditors, Grant Thornton LLP.
A full-text copy of the regulatory filing is available at no
charge at http://ResearchArchives.com/t/s?126
Headquartered in Irving, Texas, Integrated Security Systems, Inc.
-- http://www.integratedsecurity.com/-- is a technology company
that provides products and services for homeland security needs.
ISSI also designs, develops and markets safety equipment and
security software to the commercial, industrial and governmental
marketplaces. ISSI's Intelli-Site(R) provides users with a
software solution that integrates existing subsystems from
multiple vendors without incurring the additional costs associated
with upgrades or replacement.
ITRONICS INC: Sept. 30 Balance Sheet Upside-Down by $916,599
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Itronics Inc. delivered its financial results for the quarter
ended Sept. 30, 2005, to the Securities and Exchange Commission on
Nov. 21, 2005.
For the three months ended Sept. 30, 2005, Itronics reported
$243,396 of consolidated revenues, compared to revenues of
$289,734 for the prior year quarter, a decrease of 16%.
Management attributes the decrease to lower Photochemical
Fertilizer and Mining Technical Services revenues.
The Company incurred a $932,018 consolidated net loss for the
quarter ended Sept. 30, 2005, compared to a $769,956 net loss for
the comparable 2004 period, an increased loss of $162,100, or 21%.
Consolidated revenues for the first nine months of 2005 were
$1,110,697 compared to $1,322,744 for the prior year period, a
decrease of 16%. For the nine months ended Sept. 30, 2005,
Itronics' consolidated net loss was $2,665,012, compared to a net
loss of $2,283,245 for the comparable 2004 period, an increased
loss of 17%.
Itronics' balance sheet showed $5,084,954 in total assets at
Sept. 30, 2005, and liabilities of $6,001,553, resulting in a
stockholders' deficit of $916,599. At Sept. 30, 2005, the Company
had an accumulated deficit of $25,609,971.
Working Capital Deficit
At Sept. 30, 2005, Itronics' balance sheet shows a $3,576,800
working capital deficit -- $1,818,600 of which relates to
acceleration of some convertible notes and accrued interest.
Itronics currently factors certain inventory items and receivables
to meet short term cash needs. This process enables the Company
to keep limited raw materials on hand for immediate production and
to obtain cash immediately upon selling product.
Financing Activities
A private placement of stock with attached warrants closed in
June 2005, with $570,000 received during the six months ended
June 30, 2005.
In July 2005 the Company obtained financing from an 8% convertible
debt issue for up to $3.25 million, with the final amount
dependent upon the filing and effectiveness of a registration
statement relating to common shares underlying the convertible
debt and warrants issued in the recent financing.
As of Sept. 30, 2005, the Company completed the first two of three
closings and received net proceeds after financing expenses and
prepaid interest of $1,726,200. The funding will provide for
working capital, manufacturing plant expansion, registration of
GOLD'n GRO Guardian fertilizer with the EPA, and debt reduction.
Going Concern Doubt
Cacciamatta Accountancy Corporation of Irvine California expressed
substantial doubt about Itronics' 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 accumulated deficit of $22,944,959, negative
working capital of $3,215,298, and stockholders' deficit of
$2,564,270 at Dec. 31, 2004.
Itronics -- http://www.itronics.com/-- is the world's only fully
integrated photochemical recycling company. It provides
photochemical waste collection services, recovers and refines
silver from the photochemicals, manufactures and blends liquid
fertilizers - GOLD'n GRO(R) from the processed residual, and sells
and distributes a line of liquid fertilizers developed for
specific applications, such as golf and lawn turf maintenance
programs, vegetables, wine grapes, citrus and evergreens.
ITronics, through its subsidiary, Itronics Metallurgical, Inc.,
extract more than 99% of the silver and virtually all of the other
toxic heavy metals from used photoliquids and use this "Beneficial
Use Photochemical, Silver and Water Recycling" technology to
produce environmentally beneficial chelated liquid fertilizer sold
under the trademark GOLD'n GRO, animal repellant/fertilizer to be
sold under the trademark GOLD'n GRO Guardian, and silver bullion.
JORDAN INDUSTRIES: Sept. 30 Balance Sheet Upside-Down by $247 Mil.
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Jordan Industries, Inc., delivered its quarterly report on Form
10-Q for the quarter ending Sept. 30, 2005, to the Securities and
Exchange Commission on Nov. 15, 2005.
The company reported $4,123,000 of net income on $187,918,000
of net sales for the quarter ending Sept. 30, 2005. At
Sept. 30, 2005, the company's balance sheet shows $637,371,000
in total assets and a $247,140,000 stockholders deficit.
As of June 1, 2005, the company's maximum borrowings under its
revolving credit facilities decreased from $75,000,000 to
$55,000,000. This, coupled with the facts that the company has
experienced operating losses in recent years and has used cash in
operating activities, has caused the Company's executive
management to evaluate various options to improve the Company's
liquidity. To this end, the company has restructured some of its
outstanding debt through an exchange offer and certain waiver
agreements. The effect of these transactions has been to reduce
cash paid for interest in the current year as well as to provide
for further reductions in debt maturity payments if certain
financial performance is not achieved.
A full-text copy of the regulatory filing is available at no
charge at http://ResearchArchives.com/t/s?32e
Jordan Industries, Inc., was organized to acquire and operate a
diverse group of businesses with a corporate staff providing
strategic direction and support. The Company is currently
comprised of 21 businesses which are divided into five strategic
business units: (1) Specialty Printing and Labeling, (2) Consumer
and Industrial Products, (3) Jordan Specialty Plastics, (4)
Jordan Auto Aftermarket, and (5) Kinetek.
KAIRE HOLDINGS: Sept. 30 Balance Sheet Upside-Down by $2 Million
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Kaire Holdings Inc. delivered its quarterly report on Form 10-QSB
for the quarter ending Sept. 30, 2005, to the Securities and
Exchange Commission on Nov. 21, 2005.
The company reported a $177,399 net loss on $271,695 of net
revenues for the quarter ending Sept. 30, 2005.
At Sept. 30, 2005, the company's balance sheet showed a $1,968,215
stockholders' deficit and a $1,493,246 net working deficit.
The company reported net losses of $820,879 for the nine-month
period ended Sept. 30, 2005 and $1,061,598 for the nine-month
period ended Sept. 30, 2004.
On March 29, 2005, Kaire issued a $125,000, 8% interest per annum,
two year convertible note to the Longview Fund LP. On June 22,
2005, Kaire issued three two-year 8% convertible notes to:
Amount Investor
------ --------
$100,000 Longview Fund LP.
175,000 Longview Equity Fund LP
75,000 Longview International Equity Fund, LP
--------
$350,000
A full-text copy of the regulatory filing is available at no
charge at http://ResearchArchives.com/t/s?33c
Kaire Holdings provides pharmacy marketing and support services
for long-term care facilities. The company helps patients with
medication compliance, monitors for adverse drug reactions, and
supports health care providers in monitoring patients' progress.
Kaire Holdings also provides patients with monthly cycle
medications, as well as offers long-term care providers with
training and drug education. In addition, the company provides
specialized products such as mobile medication carts and emergency
medication kits.
MAFCO WORLDWIDE: Moody's Rates Proposed $125-Mil Facilities at B1
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Moody's Investors Service assigned a B1 rating to the proposed
$125 million bank loan of MAFCO Worldwide Corporation. MAFCO is
the largest global supplier of licorice extracts. Together with
excess cash, proceeds will pay a $143 million dividend to the
holding company M & F Worldwide Corporation. In turn, M & F is
using the dividend to partially finance the purchase of Clarke
American Corporation (B1 corporate family rating assigned on
November 15). The rating outlook is stable.
Ratings assigned:
* $125 million secured bank facility at B1
* Corporate family rating at B1
The long-term ratings reflect:
* MAFCO's small size,
* non-diversified product offering, and
* customer concentration.
The reliance on cigarettes as the major end-use of its products
(given that licorice flavoring are used in "American-blend"
cigarettes) and the uncertainties associated with the sourcing of
licorice roots from several Central Asian countries (including
Afghanistan and Uzbekistan) constrain the ratings. Moody's notes
that MAFCO's licorice products are an integral flavor component of
American-blend cigarettes, but global demand for cigarettes is
flat to slightly negative. The ratings are also limited by a
history of acquisitions and divestitures at the holding company
and the potential exposure to historic contingent liabilities at
divested affiliates of M & F.
However, the ratings are supported by:
* the solid credit metrics following the transaction;
* the strong margins and sizable free cash flow surpluses; and
* Moody's expectation that MAFCO will follow its pattern of
rapidly paying down debt after levering up.
Also supporting the ratings are the company's market position as
the largest global supplier of licorice extracts and the long-
established position of the MAFCO's proprietary formulations as an
essential flavoring agent in major cigarette brands. The company
maintains large inventories of raw licorice root and finished
goods in order to minimize supply disruption risks for its major
customers. Sizable insurance policies and indemnities from
PepsiAmericas, Inc. (senior unsecured rating of Baa1) and Cooper
Industries LLC (senior unsecured rating of A3) provide comfort
that MAFCO and M & F are not likely to incur cash liabilities
related to potential asbestos claims disclosed in M & F's SEC
filings.
The stable rating outlook reflects Moody's expectations that:
1) revenue will remain stable and EBITDA margins will remain
near 40%;
2) the company will use discretionary free cash flow to
amortize the term loan ahead of schedule as has previously
been done; and
3) sales of licorice products for non-tobacco uses will
continue to offset any declines in cigarette volumes.
Ratings could be negatively impacted if:
* revenue or margins materially decline from current levels;
* leverage rises above 4.5 times; or
* unexpected liabilities have a materially negative impact on
cash flow.
The B1 rating of the proposed senior secured credit facility (to
be comprised of a $15 million revolving credit facility and a $110
million term loan B) considers that this debt has a first-lien on
all of the company's tangible and intangible assets. The assigned
rating relative to the corporate family rating recognizes that
this secured bank loan is the only long-term debt on the balance
sheet. The term loan holders benefit from a cash flow sweep
(initially set at 75% of excess cash flow). Given Moody's
expectation that MAFCO will keep a meaningful cash balance,
Moody's anticipates that the revolving credit facility will not be
used. On a pro-forma basis, MAFCO would have had more than $5
million of cash and $11 million of revolving credit facility
availability (after $4 million for letters of credit).
Pro-forma for this financing transaction, debt equals about 3.3
times EBITDA, fixed charge coverage is about 4 times, and free
cash flow is approximately 15% of debt. The blended average of
raw materials and finished products inventory is high at about 450
days; the company always keeps about 2 1/2 years of raw licorice
root to guard against supply disruptions. Over the past several
years, revenue has remained at approximately $95 million as
declining cigarette consumption has been offset by the development
of other applications for licorice extracts. Moody's expects that
the company will further develop non-tobacco uses for licorice
products, but tobacco will remain the primary end-use.
MAFCO Worldwide Corporation, headquartered in Camden, New Jersey,
is the leading global producer of licorice flavorings. The
company is a wholly-owned subsidiary of M & F Worldwide
Corporation (NYSE: MFW). MAFCO generated revenue of $96 million
for the twelve months ending September 2005.
MASSEY ENERGY: Moody's Reviews $132 Million Sr. Notes' B1 Rating
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Moody's Investors Service placed Massey Energy Company's Ba3
corporate family rating and all other ratings under review for
possible downgrade. The review follows Massey's announcement that
it will issue $725 million of senior notes and undertake tender
and exchange offers for $527 million of senior and convertible
notes. Moody's estimates that Massey's debt will increase by
approximately $200 million if the tender and exchange offers are
successful.
The review for possible downgrade reflects:
* the higher debt level;
* Massey's continued inability to meet production targets; and
* its intention to use free cash flow to buy back shares.
The review is expected to conclude within the next week to 10
days.
Ratings placed under review are:
* $360 million of 6.625% Guaranteed Senior Unsecured Notes due
November 15, 2010, Ba3
* $175 million of 2.25% Guaranteed Senior Unsecured Convertible
Notes due April 1, 2024, Ba3
* $220 million of 6.95% Guaranteed Senior Unsecured Notes due
March 1, 2007, B1
* $132 million of 4.75% Guaranteed Senior Unsecured Convertible
Notes due May 15, 2023, B1
* Corporate family rating, Ba3.
Moody's notes that the 6.625% notes due 2010 and the 2.25% notes
due 2024 are guaranteed by A.T. Massey Coal Company, Inc. and
substantially all operating subsidiaries, while the 6.95% notes
due 2007 and the 4.75% notes due 2023 are guaranteed by A.T.
Massey only.
Massey has consistently failed to meet production targets of 46 to
48 million tons per annum as production has been stalled in the 42
million ton per annum range as the company has continued to
experience operating problems and production delays in its mining
operations, all of which are conducted in Central Appalachia. The
impact of these production difficulties was reflected in Massey's
3rd quarter financial performance, when it suffered an operating
loss, after adjusting for a one-time non-cash gain. Massey has
announced a $500 million share buyback and intends to use any free
cash flow generated to buy back shares under this program,
although Moody's estimates that share buy backs are currently
limited to about $100 million under the terms of its 6 5/8% notes.
The review will focus on Massey's ability to overcome operating
difficulties and meet production targets that are necessary for
the company to generate the level of earnings and cash flow that
would be consistent with the currently strong coal price
environment.
Headquartered in Richmond, Virginia, Massey Energy Company had
revenues of approximately $1.8 billion in its fiscal year ended
December 31, 2004.
MCI INC: 9 Directors Acquire 6,489 Shares of Common Stock
---------------------------------------------------------
In separate filings with the Securities and Exchange Commission
dated November 16, 2005, nine officers of MCI, Inc., disclose that
they recently acquired 6,489 shares of the Company's common stock:
Total
Shares Securities
Officer Acquired Price Now Owned
-------- -------- ----- ----------
Beresford, Dennis R. 825 $19.7 7,797
Davenport, Robert R. 476 $19.7 476
Grant, Gregory W. 746 $19.7 6,309
Haberkorn, Judith R. 746 $19.7 6,309
Harris, Laurence E. 698 $19.7 5,934
Holder, Eric H. 635 $19.7 5,507
Katzenbach, Nicholas Deb 872 $19.7 8,228
Neporent, Mark A. 698 $19.7 5,656
Rogers, Jr., Clarence B. 793 $19.7 7,509
Headquartered in Clinton, Mississippi, WorldCom, Inc., now known
as MCI -- http://www.worldcom.com/-- is a pre-eminent global
communications provider, operating in more than 65 countries and
maintaining one of the most expansive IP networks in the world.
The Company filed for chapter 11 protection on July 21, 2002
(Bankr. S.D.N.Y. Case No. 02-13532). On March 31, 2002, the
Debtors listed $103,803,000,000 in assets and $45,897,000,000 in
debts. The Bankruptcy Court confirmed WorldCom's Plan on
October 31, 2003, and on April 20, 2004, the company formally
emerged from U.S. Chapter 11 protection as MCI, Inc. (WorldCom
Bankruptcy News, Issue No. 108; Bankruptcy Creditors' Service,
Inc., 215/945-7000)
* * *
As reported in the Troubled Company Reporter on Feb. 22, 2005,
Standard & Poor's Ratings Services placed its ratings of Ashburn,
Virginia-based MCI Corp., including the 'B+' corporate credit
rating, on CreditWatch with positive implications. The action
affects approximately $6 billion of MCI debt.
MIRANT CORP: PEPCO Wants Certs. Issued to Refinance $148M Bonds
---------------------------------------------------------------
Potomac Electric Power Company is party to certain long-term
bonds aggregating $148,000,000. The bonds were originally issued
in connection with generating assets currently owned by Mirant
Corporation and its debtor-affiliates.
Andrea L. Niedermeyer, Esq., at Stutzman, Bromberg, Esserman &
Plifka, in Dallas, Texas, tells the Court that Pepco can now
refinance the bonds at lower rates. "To do so, however, Mirant
must first provide certificates concerning the operation of the
assets." The Asset Purchase and Sale Agreement for Generating
Plants and Related Assets requires Mirant to provide these
certificates upon request. Ms. Niedermeyer relates that the
certificates are ministerial in nature. "In fact, they are so
simple that they can be completed in a matter of minutes.
Mirant, however, has refused to spend those few minutes, not
because executing the certificates costs them any money or
exposes them to any liability but rather because, as [the] Court
has noted, Mirant 'enjoys a certain glee in making Pepco
miserable.'"
But while Mirant is making Pepco and its ratepayers miserable,
Mirant has incurred a claim of over $8,000,000, which increases
by approximately $5,000 to $6,000 a day, every day, Ms.
Niedermeyer says.
Accordingly, Pepco asks the Court exercise its authority under
Sections 363(b), 1107 and 1108 of the Bankruptcy Code and order
Mirant to execute the certificates.
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)
MIRANT CORP: Inks Maryland Counties' Multi-Million Settlement Pact
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Mirant Corporation, Mirant Mid-Atlantic, LLC, Mirant Piney Point,
LLC, Mirant MD Ash Management, LLC, Mirant Chalk Point, LLC,
Mirant Peaker, LLC, and their affiliated debtors sought and
obtained Court approval of their settlement agreements with
Charles County and Prince George's County in Maryland.
Ian T. Peck, Esq., at Haynes and Boone, LLP, in Dallas, Texas,
relates that MirMA, Piney Point and MD Ash are liable to Charles
County for unpaid 2003 prepetition taxes on certain real and
personal property located in the county. Chalk Point, Piney
Point, MD Ash, Peaker and MirMA are also liable to Prince
George's County for unpaid 2003 prepetition taxes on certain real
and personal property in Prince George's County.
On various dates, Charles County filed eight proofs of claim
against certain of the Charles County Debtors alleging that it
possesses secured claims on account of unpaid 2003 prepetition
taxes accrued on the Charles County Property as well as
postpetition interest at the rate of 12% per annum. Charles
County alleges that, as of September 30, 2005, it is owed
$17,640,718 on account of the Charles County Claims.
Prince George's County, on the other hand, filed 11 proofs of
claim against the Prince George's County Debtors alleging that it
possesses secured claims on account of:
-- unpaid 2003 prepetition taxes accrued on the Prince
George's County Property;
-- postpetition interest at the rate of 8% per annum for
the portion of prepetition taxes payable at the county
interest rate;
-- an additional 12% per annum penalty rate of interest for
the portion of prepetition taxes payable at the County
Interest Rate; and
-- an additional 12% per annum for the portion of prepetition
taxes payable at the State of Maryland interest rate.
As of September 30, 2005, Prince George's County alleges that it
is owed $19,413,973 on account of the Prince George's County
Claims, Mr. Peck relates.
According to Mr. Peck, the Debtors and the Counties don't agree
on the plan treatment of the Claims and the applicable
postpetition interest rate.
The Counties believe that they should not receive a Plan Secured
Note on account of their Claims, but rather should be paid the
full amount of their Claims on the Distribution Date.
In contrast, the Debtors assert that the Plan's proposed
treatment of the Claims is wholly appropriate under the
Bankruptcy Code.
Mr. Peck contends that while the Counties are entitled to payment
of some postpetition interest, the statutory interest rate of 12%
with respect to the Charles County Claims and the Prince George's
alleged interest rate with respect to its Claims is significantly
higher than any interest rate that the Counties would be entitled
to receive under Section 506 of the Bankruptcy Code.
To settle and compromise all issues and disputes existing between
them with respect to the Claims, the parties agree that the
postpetition interest payable on the unpaid 2003 prepetition
taxes will be 6% per annum, subject to the Maryland Debtors'
payment of, in full satisfaction of the Claims:
-- $15,986,453 for the Prince George's Claims; and
-- $15,559,925 for the Charles County Claims.
Mr. Peck notes that as a result of the interest rate reduction,
the Debtors will collectively save more than $5,508,310 in
potential postpetition interest.
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: Asks Court to Compel Wilson to Comply with Rule 2019
-----------------------------------------------------------------
The Wilson Law Firm, P.C., represents a group of Mirant
Corporation's equity holders who have chosen to function as a
single, unified ad hoc committee in the Debtors' Chapter 11
cases.
While the Wilson Shareholders may believe it benefits to act as a
unit, the formation of an ad hoc committee has also triggered
certain obligations on the part of the Wilson Shareholders and
their legal representatives, Craig H. Averch, Esq., at White &
Case LLP, in Miami, Florida, notes. Those obligations include
the mandatory disclosure provisions required by Rule 2019 of the
Federal Rules of Bankruptcy Procedure.
In its Rule 2019 Verified Statement dated April 18, 2004, The
Wilson Firm reported to represent five shareholders:
(1) Frank Smith,
(2) R. Weldon Tigner,
(3) Dave Lucas,
(4) Nancy Sterk, and
(5) David Matter.
Under its first amended Rule 2019 Verified Statement dated May 5,
2005, The Wilson Firm represented these equity security holders:
Shareholder Common Shares Owned Date Acquired
----------- ------------------- -------------
Clark Lewis 25,000 Unknown
Dave Lucas 8,000 Unknown
David Matter 10,600 Unknown
Frank Smith 145,000 Unknown
Harris Rush 30,000+ Unknown
Jack Strohbach 85,000 Unknown
L. Matt Wilson 270,000 Post-bankruptcy
Nancy Sterk 4,000 Unknown
R. Weldon Tigner 37,730 Unknown
L. Matt Wilson, Esq., also owns $110,000 of Mirant 5.7% 2007
Bonds.
The Verified Statements provide for the nature and amount of the
claim or interest held by each of the Wilson Shareholders.
However, The Wilson Firm's First Amended Verified Statement
provides that Mr. Rush owns 30,000+ MIRKQ common shares, Mr.
Averch notes.
"It is unclear whether this statement means that Mr. Rush owns
approximately 30,000 MIRKQ common shares or at least (and
potentially substantially more than) 30,000 MIRKQ common shares,"
Mr. Averch tells the Court.
Mr. Averch adds that the Verified Statements fail to provide the
specific dates on which the Wilson Shareholders acquired their
claims and equity interest, as required by Bankruptcy Rule
2019(a)(2). The failure to provide the date on which the claim
or equity interest was acquired is especially troubling in the
case of L. Matt Wilson, a principal attorney of the firm, Mr.
Averch points out.
"Mr. Wilson is not listed on the Original Verified Statement,
suggesting that he purchased his claims and equity interests
between the time the Original Verified Statement and the First
Amended Verified Statement were filed. However, the First
Amended Verified Statement provides merely that Mr. Wilson
purchased the claims and equity interests "Post-Bankruptcy."
According to Mr. Averch, the Debtors have informed the Wilson
Firm of the deficiencies in its Verified Statements. The Debtors
also asked the Wilson Firm to file another amended verified
statement that complied with Bankruptcy Rule 2019.
The Wilson Firm has refused to comply with the Debtors' request
and asserted that the Verified Statements were in compliance with
Bankruptcy Rule 2019.
Thus, the Debtors ask the Court to:
a. compel The Wilson Firm to produce information concerning
the Wilson Shareholders in compliance with Bankruptcy Rule
2019; or
b. absent compliance with the Bankruptcy Rule 2019
requirements, prevent The Wilson Firm from further
participation in the Debtors' Chapter 11 cases.
Bankruptcy Rule 2019 mandates that every entity or ad hoc
committee representing more than one creditor or equity holder in
a Chapter 11 case file a verified statement that provides for
specified information relating to the identities and the claims
or equity interests held by the individual that the entity or
committee represents. "Each participant in a reorganization case
is better able to act in its own interests when it has sufficient
information with which to assess the true interests and
motivations of the other entities," Mr. Averch states.
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. 80 Bankruptcy Creditors'
Service, Inc., 215/945-7000)
NBO SYSTEMS: Financial Woes Prompt Going Concern Doubt
------------------------------------------------------
NBO Systems, Inc., delivered its financial statements for the
quarterly period ended Sept. 30, 2005, to the Securities and
Exchange Commission on Nov. 14, 2005.
Revenues and other income increased approximately 25.0% despite a
decrease in transaction volume of approximately 14.9% for the
three-month period ended September 30, 2005. For the nine-month
period ended Sept. 30, 2005, revenues and other income increased
approximately 7.5% despite a decrease in transaction volume of
approximately 38.2%.
The company reported net losses decreased by 21.1% or $383,000 to
$1,429,000 from $1,812,000 in the three months ended Sept. 30,
2005, compared to the three months ended Sept. 30, 2004,
respectively. Net losses increased by 16.8% or $703,000 to
$4,897,000 from $4,194,000 in the nine months ended Sept. 30,
2005, compared to the nine months ended September 30, 2004,
respectively.
At Sept. 30, 2005, the company's balance sheet showed $5,472,646
in total assets and $15,405,355 in total debts. As of Sept. 30,
2005, the Company's equity deficit increased to $9.9 million from
a $7.6 deficit at December 31, 2004.
Going Concern Doubt
The Company has incurred net losses since inception and negative
cash flows from operating activities. During the nine months
ended September 30, 2005, the Company had negative cash flows of
$4,158,165 from operating activities. At September 30, 2005, the
Company had a deficit in working capital of $10,739,941.
The Company's ability to meet its obligations as they come due is
dependent upon its ability to obtain additional financing as
required, and ultimately to achieve and sustain profitability.
These conditions raise substantial doubt about the Company's
ability to continue as a going concern.
There can be no assurance that the Company will be successful in
executing its plans to improve operations or obtain additional
debt or equity financing. If the Company is unable to improve
operations or obtain additional debt and equity financing, it may
be required to restructure operations during 2005. Management
believes that if the Company were not able to obtain additional
financing for the development of its overall business, operations
could be restructured in order for the Company to be profitable at
the current level of sales. However, there can be no assurance
that the Company will be able to achieve its plan or to continue
operating without additional financing.
NBO Systems, Inc., is a developer, marketer and supplier of
prepaid stored-value card programs including gift cards, corporate
incentive and membership reward cards, and fund-raising cards.
The company markets its programs to mall owners or developers and
operators, restaurant chains, retailers, corporate incentive
providers, membership reward programs and fund-raising
organizations throughout the United States. Their business
historically focused primarily on mall gift certificates, mall
gift cards and third party gift card order fulfillment services,
which subject us to typical retail seasonality curves.
The company also provide all call center and internet fulfillment
of gift certificates and gift cards for clients of ValueLink, a
subsidiary of First Data Corp, and third-party providers of their
own dedicated, closed-end gift card programs such as Darden
Restaurants, Inc., a subsidiary of General Mills Restaurant, Inc.
The company are currently soliciting, negotiating, and finalizing
additional business relationships with other national restaurant
chains and retail outlets that typically have store locations in
or near shopping malls across the United States.
As of Dec. 31, 2004, the Company has suffered recurring losses,
has a working capital deficit of $4,546,863 and an accumulated
deficit of $34,301,717 and had negative cash flows from operating
activities of $2,144,400 for the year ended December 31, 2004.
These conditions raise substantial doubt about the Company's
ability to continue as a going concern.
NORTHWEST AIRLINES: Owes $83 Million on Davey Terminal Bonds
------------------------------------------------------------
On Oct. 17, 2005, Wayne County Airport Authority began
demolition work on the 38-year-old James M. Davey Terminal, which
had been vacant since February 2002, to make way for a more
modern and efficient North Terminal at the Detroit Metropolitan
Airport.
James M. Davey is universally credited with laying the foundation
for making the Detroit Airport one of the most important airports
of the jet age. Mr. Davey died in 1997.
When the Davey Terminal, originally known as North Terminal or
Terminal 2, was built in 1966, the Detroit Airport handled a
total of 4,200,000 passengers. By 2000, after numerous
modifications, concourse extensions and gate additions, the
Airport was handling 35,500,000 passengers, and the Davey
Terminal had become severely overcrowded and complicated to
navigate. In February 2002, Northwest Airlines moved its hub
operations to the McNamara Terminal.
The Detroit Free Press has reported that Northwest Airlines still
owes $83,400,000 in bonds, sold 20 years ago to fund improvements
to the Davey Terminal.
A year after making the Davey Terminal its hub in 1985, Republic
Airlines sold $90,500,000 in bonds to pay for projects such as an
underground fuel system, a flight kitchen and other projects at
the Davey Terminal. Northwest inherited the debt when it merged
with Republic.
Northwest's payments on the Davey bonds amount to $100,000 a year
and would culminate in an $82,000,000 payment when the bonds
mature in 2015, said Carla Sledge, chief financial officer for
Wayne County, which sold the bonds for Republic.
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. 8;
Bankruptcy Creditors' Service, Inc., 215/945-7000)
NYLIM STRATFORD: Moody's Places Class C Notes' B1 Rating on Watch
-----------------------------------------------------------------
Moody's Investors Service placed the $32 million Class C Fixed
Rate Notes due 2036 issued by NYLIM Stratford CDO 2001-1 Ltd. on
watch for possible downgrade.
According to Moody's, the rating action results from deterioration
in the credit quality and par amount of the transaction's
collateral portfolio and the failure of the portfolio to meet all
interest coverage tests.
Moody's noted that this mezzanine structured finance
resecuritization closed in April 2001 and is managed by New York
Life Investment Management LLC.
Rating action: Review for downgrade
Issuer: NYLIM Stratford CDO 2001-1 Ltd.
Class Description: U.S. $32,000,000 Class C Fixed Rate Notes
Due 2036
* Prior Rating: B1
* Current Rating: B1 on watch for possible downgrade
O'SULLIVAN INDUSTRIES: Can Keep Existing Bank Accounts
------------------------------------------------------
As reported in the Troubled Company Reporter on Oct. 24, 2005,
O'Sullivan Industries Holdings, Inc., and its debtor-affiliates
ask the U.S. Bankruptcy Court for the Northern District of Georgia
to authorize them to continue to maintain their existing bank
accounts.
James C. Cifelli, Esq., at Lamberth, Cifelli, Stokes & Stout,
P.A., in Atlanta, Georgia, tells the Court that authorizing the
Debtors to continue to use their existing bank accounts is
essential to their smooth and orderly transition into Chapter 11.
Mr. Cifelli points out that the Debtors' employees would suffer
great hardship if the Debtors are compelled to substitute a new
debtor-in-possession payroll account for the existing account.
"A new payroll account would inevitably lead to delays, confusion,
and disruption of payments that would likely adversely affect
employee morale at this critical juncture," Mr. Cifelli asserts.
The Court grants the Debtors' request on a final basis.
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: Establishes New Insurance Policy with Old Republic
-----------------------------------------------------------------
Under various state laws, Owens Corning is required to provide
workers' compensation insurance for its employees. Owens
Corning, therefore, is a beneficiary of these large deductible
workers' compensation insurance policies issued by Old Republic
Insurance Company:
(1) a policy with a term running from September 1, 2000, to
September 1, 2001;
(2) a policy with a term running from September 1, 2001, to
September 1, 2002;
(3) a policy with a term running from September 1, 2002, to
September 1, 2003, which was extended to November 1, 2003;
(4) a policy with a term running from November 1, 2003, to
November 1, 2004; and
(5) a policy with a term running from November 1, 2004, to
November 1, 2005.
The Previous Stipulations
Norman L. Pernick, Esq., at Saul Ewing LLP, in Wilmington,
Delaware, reminds the Court that the parties have entered into
four previous stipulations that clarified certain issues
regarding the policies and extended the policy expiration dates.
Pursuant to the terms of the 00/01 Policy, Owens Corning is
liable for all losses paid within the deductible level -- which
is $500,000 for each occurrence -- and provided Old Republic with
a prepetition letter of credit, equal to $8,361,000, from Credit
Suisse First Boston.
Mr. Pernick recounts that the First Stipulation addressed issues
concerning Old Republic's reimbursement rights and associated
claims against Owens Corning with respect to the 00/01 Policy and
the 01/02 Policy. Due to the expiration of the 01/02 Policy, the
parties entered into the 02/03 Policy, which also raised the same
issues as the previous ones. The issues relating to the 02/03
Policy were resolved through the Second Stipulation. In
accordance with the 02/03 Policy and the Second Stipulation,
Owens Corning increased the Letter of Credit from $8,500,000 to
$18,500,000.
Owens Corning and Old Republic agreed to extend the expiration
date of the 02/03 Policy until November 1, 2003, so that all of
Owens Corning's policies for all types of coverage would have the
same renewal date. Due to the expiration of the 02/03 Policy,
the parties eventually entered into the 03/04 Policy. The issues
raised by the 03/04 Policy were addressed and resolved through
the Third Stipulation. In accordance with the Third Stipulation,
Owens Corning is liable for all losses paid within the deductible
level, which is $500,000 for each occurrence, plus any allocated
loss adjustment expenses. Owens Corning also increased the
Letter of Credit -- now Postpetition L/C -- from $18,500,000 to
$20,500,000.
According to Mr. Pernick, the Fourth Stipulation resolved the
issues relating to the 04/05 Policy, which the parties entered
into at the 03/04 Policy's expiration. The 04/05 Policy had a
term running from November 1, 2004, to November 1, 2005. Under
the terms of the 04/05 Policy, Owens Corning is liable for all
losses paid within the deductible level, which is $500,000 for
each occurrence, plus any allocated loss adjustment expenses.
Old Republic no longer required that any additional collateral be
posted.
The New Policy
Mr. Pernick relates that at the expiration of the 04/05 Policy,
Old Republic issued a new workers' compensation policy to Owens
Corning for the one-year period commencing as of November 1,
2005. He explains that the terms of the New Policy are generally
consistent with previous dealings between the parties and Owens
Corning's experience with other carriers, except that the
deductible level of the policy was raised to $1,000,000 for each
occurrence, plus any allocated loss adjustment expenses.
In the course of the parties' renewal discussions, Old Republic
informed Owens Corning that it required clarification of the same
issues with respect to the New Policy that the previous
stipulations have resolved. Old Republic did not require that
any additional collateral be posted in connection with the
issuance of the New Policy.
Accordingly, the parties entered into a fifth stipulation setting
the terms of the New Policy:
(a) Old Republic is entitled to an unliquidated administrative
claim against Owens Corning, on account of the possibility
that:
-- Owens Corning may fail to make certain premium
payments, or fail to pay any other amount due with
respect to the New Policy; or
-- Owens Corning may fail to make payments within the
deductible layer of the New Policy for deductibles
relating to or on account of occurrences giving rise to
workers' compensation claims;
(b) The Owens Corning Administrative Claim will:
-- survive confirmation of Owens Corning's plan of
reorganization;
-- not be liquidated or adjudicated by the Court; and
-- not be payable on the effective date of the plan;
(c) The Court's approval of the Fifth Stipulation is to be
deemed an authorization or ratification for Owens Corning
to enter into the New Policy. Owens Corning is not to
seek to recover, until November 1, 2008, any excess
proceeds of the Prepetition L/C or the Postpetition L/C,
if drawn upon by Old Republic, unless otherwise agreed by
the parties;
(d) The proceeds of the Prepetition L/C are to be applied
first to Old Republic's prepetition claim on account of
the 00/01 Policy. Old Republic may apply the remaining
proceeds of the Prepetition L/C and the proceeds of the
Postpetition L/C to its administrative claims relating to
the 00/01 Policy, the 01/02 Policy, the 02/03 Policy, the
03/04 Policy, the 04/05 Policy and the New policy as it
sees fit, in its sole reasonable discretion. However, no
proceeds of the Prepetition L/C is to be applied to any
administrative claim by Old Republic related to the 04/05
Policy or the New Policy; and
(e) In the event Owens Corning does not make all required
premium payments owed on account of the New Policy or does
not make all required deductible payments on account of
the claims covered by the New Policy, Old Republic is to
be entitled, without obtaining relief from the automatic
stay, but only after providing Owens Corning, the
committees and the Futures Representative with no less
than seven days' prior written notice, to exercise its
state law rights, if any, to cancel the New Policy.
Mr. Pernick contends that the Court has already approved the
terms of the Fifth Stipulation since it had approved the four
earlier stipulations, which have similar terms. Mr. Pernick,
however, points out that the Fifth Stipulation improves on the
other four by foreseeing certain issues and avoiding them. One
of these issues is that Old Republic's reimbursement rights and
associated claims in relation to the new policy it issued will
remain unliquidated for a long time because covered workers'
claims may be payable for years after the policy's expiration.
Moreover, Mr. Pernick believes that the Fifth Stipulation is
favorable to the Debtors' Estates because it will continue to
permit Owens Corning to obtain workers' compensation insurance
for the upcoming year rates. Moreover, placing a value on claims
for deductible loss reimbursement relating to large deductible
policies shortly after a policy year ends may be difficult and
could result in estimated claims which are much higher or lower
than the actual reimbursement claims later.
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)
PATRON SYSTEMS: Sept. 30 Balance Sheet Upside-Down by $345,194
--------------------------------------------------------------
Patron Systems Inc. delivered its quarterly report on Form 10-QSB
for the quarter ending Sept. 30, 2005, to the Securities and
Exchange Commission on Nov. 21, 2005.
The company reported a $12,677,722 net loss on $152,941 of
net revenues for the quarter ending June 30, 2005, and a
$19,910,022 net loss for the nine months ended Sept. 30, 2005.
At Sept. 30, 2005, the company's balance sheet shows $26,385,169
in total assets and a $345,194 stockholders deficit.
The company reported a working capital deficiency at Sept. 30,
2005, of $23,033,903 and the company is continuing to experience
shortages in working capital.
The company is also involved in substantial litigation involving
its prior stock registrations issued to certain consultants. The
litigation is currently being investigated by the SEC.
A full-text copy of the regulatory filing is available at no
charge at http://ResearchArchives.com/t/s?339
Headquartered in Chicago, Illinois, Patron Systems, Inc. --
http://www/patronsystems.com-- was established in 2002 to provide
Immediate, Intelligent Information Security(TM) solutions to
financial services corporations, Homeland Security agencies, and
public safety organizations. In response to the growing need for
a more complete offering to protect data both in the enterprise
and in government, Patron Systems acquired three key technology
companies and consolidated them into a unique offering for
regulatory compliance and lifecycle protection of critical data.
The company's technologies include the leading email surveillance
and policy engine, the only secure data entry and eForms tool
using JusticeXML for unfettered sharing of data between and among
the various law enforcement entities, and a hosted business
continuity, archival, storage, and disaster recovery data center.
RAVEN MOON: Posts $1.1 Mil. Net Loss in Quarter Ending Sept. 30
---------------------------------------------------------------
Raven Moon Entertainment Inc. delivered its quarterly report on
Form 10-QSB for the quarter ending Sept. 30, 2005, to the
Securities and Exchange Commission on Nov. 21, 2005.
The company reported a $1,129,373 net loss for the quarter ending
June 30, 2005, compared to a $1,909,272 net loss of the same
period last year. During the nine months ending Sept. 30, 2005,
the company recorded a net loss of $4,880,837, as compared to a
loss $7,133,660 for the nine months ending Sept. 30, 2004.
At Sept. 30, 2005, the company's balance sheet showed a
stockholders' deficit of $1,871,796.
Going Concern Doubt
At September 30, 2005 the Company has $76,263 in cash, total
assets of $153,339. At September 30, 2005 Raven Moon's total
liabilities totaled $2,025,135. These circumstances raise
substantial doubt about the Company's ability to continue as a
going concern.
The company's ability to continue as a going concern is dependent
upon positive cash flows from operations and ongoing financial
support. Adequate funds may not be available when needed or may
not be available on terms favorable to the company.
If the company is unable to secure sufficient funding, the company
may be unable to develop or enhance its products and services,
take advantage of business opportunities, respond to competitive
pressures or grow the company's business in the manner that the
company's management believes is possible.
This could have a negative effect on the company's business,
financial condition and results of operations. Without such
support, the company may not be able to meet its working capital
requirements and accordingly the company and its subsidiaries may
need to reorganize and seek protection from its creditors.
A full-text copy of the regulatory filing is available at no
charge at http://ResearchArchives.com/t/s?338
Raven Moon Entertainment, Inc. -- http://www.ravenmoon.net/--
develops and produces children's television programs and videos,
CD music, and Internet websites focused on the entertainment
industry. Raven Moon talks about music publishing and talent
management on its Web site. Raven Moon indicates in its latest
quarterly report that it wants to enter the plush toy market too.
ROMACORP INC: Committee Wants to Hire Haynes & Boone as Counsel
---------------------------------------------------------------
The Official Committee of Unsecured Creditors in Romacorp, Inc.,
and its debtor-affiliates' chapter 11 cases asks the U.S.
Bankruptcy Court for the Northern District of Texas for permission
to employ Haynes and Boone, LLP as its counsel.
Haynes and Boone will:
a) advise the Committee of its powers and duties in the
Debtors' bankruptcy proceedings
b) assist the Committee in analyzing and preparing all
applications, motions, objections, responses, orders filed
in the Debtors' bankruptcy cases, and any related
adversary proceedings;
c) appear and represent the Committee at all hearings;
d) assist the Committee and its other professionals in matters
related to the administration of the Debtors' chapter 11
cases and the formulation and confirmation of a plan of
reorganization; and
e) perform other legal services for the Committee that are
necessary and required in the Debtors' chapter 11 cases.
Tom A. Howley, Esq., a Partner at Haynes and Boone, is one of the
lead attorneys for the Committee. Mr. Howley charges $470 per
hour for his services.
Mr. Howley reports Haynes and Boone's professionals bill:
Professional Designation Hourly Rate
------------ ----------- -----------
Jonathan C. Wilson Partner $490
Laurie Lang Partner $430
Debra Hatter Partner $410
Scott Everett Associate $415
Mark Elmore Associate $275
Dian Gwinnup Paralegal $170
Haynes and Boone assures the Court that it does not represent any
interest materially adverse to the Committee and is a
disinterested person as that term is defined in Section 101(14) of
the Bankruptcy Code.
The Court will convene a hearing at 9:00 a.m., on Dec. 20, 2005,
to consider the Committee's request.
Headquartered in Dallas, Texas, Romacorp, Inc., own and operate
the Tony Roma chain of restaurants with 22 company-owned stores,
86 domestic franchise stores and 118 international franchise
stores. The Debtor and seven of its affiliates filed for chapter
11 protection on November 6, 2005 (Bankr. N.D. Tex. Case No.
05-86818). Peter S. Goodman, Esq., Jason S. Brookner, Esq.,
Monica S. Blacker, Esq., and Matthew D. Wilcox, Esq., at Andrews
Kurth LLP represent the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $20,769,000 in total assets and $76,309,000 in total debts.
ROMACORP INC: Look for Bankruptcy Schedules on December 6
---------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Texas gave
Romacorp, Inc., and its debtor-affiliates until Dec. 6, 2005, to
file their Schedules of Assets and Liabilities, Statements of
Financial Affairs, and Statements of Executory Contracts and
Unexpired Leases.
The Debtors gave the Court three reasons in support of the
extension:
a) their operations are a large and complex enterprise
consisting of eight debtor-affiliates with aggregate debts
of more than $78 million and with operations in multiple
locations throughout the world;
b) their key business personnel were faced with numerous tasks
that had to be completed in the weeks leading up to the
Petition Date before they focused on the schedules and
statements; and
c) they and their personnel are currently mobilizing the
necessary resources to review the materials needed for the
schedules and statements and complete and file those
documents on or before the December 6 deadline.
Headquartered in Dallas, Texas, Romacorp, Inc., own and operate
the Tony Roma chain of restaurants with 22 company-owned stores,
86 domestic franchise stores and 118 international franchise
stores. The Debtor and seven of its affiliates filed for chapter
11 protection on November 6, 2005 (Bankr. N.D. Tex. Case No.
05-86818). Peter S. Goodman, Esq., Jason S. Brookner, Esq.,
Monica S. Blacker, Esq., and Matthew D. Wilcox, Esq., at Andrews
Kurth LLP represent the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $20,769,000 in total assets and $76,309,000 in total debts.
REFCO INC: Wants Court to Okay Bid Procedures for FX Asset Sale
---------------------------------------------------------------
As reported in the Troubled Company Reporter on Nov. 14, 2005,
Refco Inc., and its debtor-affiliates signed a Memorandum of
Understanding with Forex Capital Markets LLC, a Futures Commission
Merchant registered with the Commodity Futures Trading Commission
and a member of the National Futures Association, to sell certain
of its retail FX assets. The MOU
provides for:
* The sale of more than 15,000 retail client accounts of Refco
FX Associates LLC (RefcoFX.com); and
* The 35% share of Forex Capital Markets LLC currently owned
by Refco.
The transaction, which is valued at more than $110 million,
includes cash, the assumption of certain customer account
liabilities and forgiveness of certain debt.
Under the terms of the MOU, RefcoFX.com clients may continue
trading in their accounts without disruption, and - upon the
consummation of a transaction -- all retail customer positions and
orders traded on RefcoFX.com will be transferred intact.
* * *
The Debtors propose to implement uniform bidding procedures of
the sale of Refco F/X Associates, LLC's assets to Forex Capital
Markets, L.L.C.
A full-text copy of the Bid Procedures is available for free at:
http://bankrupt.com/misc/refco_fxbidprocedures.pdf
The Bid Procedures contemplate an auction process similar to that
conducted for the sale of the assets of Refco, LLC:
-- qualification of bidders,
-- access to information,
-- a minimum initial overbid requirement, and
-- the Debtors' determination of the highest and best bid in
consultation with the Official Committee of Unsecured
Creditors and representatives of the syndicate of lenders
led by Bank of America.
In addition, the Bid Procedures contemplate certain protections
for FXCM as the opening bidder, who has committed to a floor
price for the auction.
Specifically, the Bid Procedures provide, among other things,
that:
(1) The minimum bid must equal or exceed the sum of:
-- the purchase price, plus
-- the $2,000,000 minimum overbid increment, plus
-- FXCM's $3,150,000 break-up fee, plus
-- FXCM's $1,000,000 expense reimbursement, plus
-- an amount sufficient to cure all monetary defaults
under the FMA.
(2) Potential bidders are not entitled to a break-up fee,
termination fee, expense reimbursement or similar type of
payment.
(3) The Debtors must receive a Bid in writing on or before
December [__], 2005, at __:00 _.m. Eastern Time.
(4) If the Debtors receive a Qualified Bid other than FXCM's,
an auction will be held on December [__], 2005, at __:00
_.m. Eastern Time, at the offices of Skadden, Arps, Slate,
Meagher & Flom LLP, Four Times Square, New York, NY 10036
or at any other location as the Debtors may designate.
(5) Each Overbid will be made in increments of at least
$1,000,000 in excess of the previously announced highest
and best bid.
(6) At the close of the Auction, the Debtors will identify
which Qualified Bidder had the highest and best bid, which
will be determined by considering, among other things:
(a) the total consideration to be received by the
Debtors;
(b) the likelihood of each Qualified Bidder's ability
to timely close a transaction and make any deferred
payments, if applicable;
(c) the likelihood that each Qualified Bidder will be
able to demonstrate adequate assurance of future
performance of the Debtor's obligations under the
Assumed Contracts; and
(d) the net benefit to the estate, taking into account
the Purchasers' rights to the Purchasers' Bid
Protection.
(7) The sale hearing will be held on December [__], 2005, at
__:__ _.m. Eastern Time.
The Court will conduct a hearing on the Bid Procedures Motion at
10:00 a.m. on December 2, 2005.
About Forex Capital Markets LLC
Forex Capital Markets LLC provides currency trading services to
retail traders under the name FXCM -- http://www.fxcm.com/-- and
to institutional clients under name FXCM Pro --
http://www.fxcmpro.com/
The firm has serviced over 50,000 accounts and is registered with
the CFTC as a Futures Commission Merchant. FXCM has received
numerous awards from the investment community, including Best
Currency Broker from Shares, Best Retail Foreign Exchange Platform
from FX Week and Best Foreign Exchange Specialist from Technical
Analysis of Stocks & Commodities. In addition to currency
trading, FXCM offers educational courses on forex trading, and
provides research through DailyFX.com. FXCM will soon provide
managed account programs for clients seeking investment
diversification.
About Refco Inc
Headquartered in New York, New York, Refco Inc. --
http://www.refco.com/-- is a diversified financial services
organization with operations in 14 countries and an extensive
global institutional and retail client base. Refco's worldwide
subsidiaries are members of principal U.S. and international
exchanges, and are among the most active members of futures
exchanges in Chicago, New York, London and Singapore. In addition
to its futures brokerage activities, Refco is a major broker of
cash market products, including foreign exchange, foreign exchange
options, government securities, domestic and international
equities, emerging market debt, and OTC financial and commodity
products. Refco is one of the largest global clearing firms for
derivatives.
The Company and 23 of its affiliates filed for chapter 11
protection on Oct. 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006).
J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom
LLP, represent the Debtors in their restructuring efforts. Refco
reported $16.5 billion in assets and $16.8 billion in debts to the
Bankruptcy Court on the first day of its chapter 11 cases. (Refco
Bankruptcy News, Issue No. 11; Bankruptcy Creditors' Service,
Inc., 215/945-7000)
REFCO INC: Wants Court to Okay $3.15-Mil Break-Up Fee for FXCM
--------------------------------------------------------------
In recognition of the expenditure of time, energy and resources,
and the benefits to the Debtors' estates of securing a minimum
bid for Refco F/X Associates, LLC's assets, Refco Inc., and its
debtor-affiliates have agreed to seek bid protections for Forex
Capital Markets, L.L.C.
The Debtors propose to pay FXCM a $3,150,000 Break-Up Fee
(approximately 2.8% of the Purchase Price) and Expense
Reimbursement of reasonably documented out-of-pocket expenses in
an amount not to exceed $1,000,000 to be paid in the event of a
disposition of the Acquired Assets in any alternative transaction
within nine months after entry of a Bid Procedures Order.
According to the Debtors, the Bid Protections were a material
inducement for, and a condition of, FXCM's entry into the
Memorandum of Understanding.
The Debtors believe that the Bid Protections are fair and
reasonable in view of, among other things, the fact that FXCM's
efforts have increased the chances that the Debtors will receive
the highest and best offer for the Acquired Assets, by:
-- establishing a minimum for other bidders,
-- placing the Retail F/X Assets in a sales configuration mode
thereby attracting other bidders to the Auction,
-- assisting the Debtors in their efforts to stabilize their
business including the Acquired Assets,
-- waiving certain corporate governance rights, which
materially enhance the ability of the Debtors' to conduct
an auction, and
-- serving as a catalyst for other potential or actual
bidders, to the benefit of the Debtors, their estates,
their creditors and all other parties-in-interest.
The Debtors tell Judge Drain that FXCM is unwilling to execute
the Purchase Agreement and to commit to hold open its offer to
purchase the Acquired Assets unless the Bid Protections are
approved and payment of the Expense Reimbursement and the Breakup
Fee are authorized.
Thus, the Debtors ask the U.S. Bankruptcy Court for the Southern
District of New York to approve the Bid Protections and authorize
payment of the Expense Reimbursement and Breakup Fee.
The Debtors submit that the proposed Breakup Fee is:
(a) an actual and necessary cost and expense of preserving the
relevant Debtors' estates, within the meaning of Section
503(b) of the Bankruptcy Code,
(b) of substantial benefit to the Debtors,
(c) reasonable and appropriate, in light of the size and
nature of the proposed transaction and the efforts that
have been and will be expended by FXCM notwithstanding
that the proposed Sale is subject to higher or better
offers for the Acquired Assets, and
(d) necessary to ensure that FXCM will continue to pursue its
proposed acquisition of the Acquired Assets.
Headquartered in New York, New York, Refco Inc. --
http://www.refco.com/-- is a diversified financial services
organization with operations in 14 countries and an extensive
global institutional and retail client base. Refco's worldwide
subsidiaries are members of principal U.S. and international
exchanges, and are among the most active members of futures
exchanges in Chicago, New York, London and Singapore. In addition
to its futures brokerage activities, Refco is a major broker of
cash market products, including foreign exchange, foreign exchange
options, government securities, domestic and international
equities, emerging market debt, and OTC financial and commodity
products. Refco is one of the largest global clearing firms for
derivatives.
The Company and 23 of its affiliates filed for chapter 11
protection on Oct. 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006).
J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom
LLP, represent the Debtors in their restructuring efforts. Refco
reported $16.5 billion in assets and $16.8 billion in debts to the
Bankruptcy Court on the first day of its chapter 11 cases. (Refco
Bankruptcy News, Issue No. 11; Bankruptcy Creditors' Service,
Inc., 215/945-7000)
REFCO INC: Refco LLC Files Chapter 7 to Consummate Asset Sale
-------------------------------------------------------------
Refco Inc. (OTC: RFXCQ) successfully concluded its sale of
substantially all of the assets of Refco's domestic regulated
commodity futures business to Man Financial Inc., a wholly owned
subsidiary of Man Group plc.
As anticipated, the sale was consummated shortly after Refco LLC
filed a voluntary Chapter 7 petition. The U.S. Bankruptcy Court
for the Southern District of New York approved the sale at the
request of the Chapter 7 Trustee, Albert Togut, to permit the
seamless transfer of customer accounts over the weekend when
global markets are closed.
In addition, substantially all of the employees Refco LLC are
joining Man.
"We are delighted that the difficult period since the October 10th
announcements has now come to an end," Kevin Davis, CEO and
Chairman of Man Financial, said. "We are confident that the
combined strengths of our two companies will ensure that we are in
a position to offer our clients an unrivalled service, across a
wide variety of products, in every time zone."
Headquartered in New York, New York, Refco Inc. --
http://www.refco.com/-- is a diversified financial services
organization with operations in 14 countries and an extensive
global institutional and retail client base. Refco's worldwide
subsidiaries are members of principal U.S. and international
exchanges, and are among the most active members of futures
exchanges in Chicago, New York, London and Singapore. In addition
to its futures brokerage activities, Refco is a major broker of
cash market products, including foreign exchange, foreign exchange
options, government securities, domestic and international
equities, emerging market debt, and OTC financial and commodity
products. Refco is one of the largest global clearing firms for
derivatives.
The Company and 23 of its affiliates filed for chapter 11
protection on Oct. 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006).
J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom
LLP, represent the Debtors in their restructuring efforts. Refco
reported $16.5 billion in assets and $16.8 billion in debts to the
Bankruptcy Court on the first day of its chapter 11 cases.
REFCO LLC: Voluntary Chapter 7 Case Summary
-------------------------------------------
Debtor: Refco LLC
One World Financial Center
200 Liberty Street, Tower A
New York, New York 10281
Bankruptcy Case No.: 05-60134
Type of Business: The Debtor is a regulated commodity futures
company that has businesses in the United
States, London, Asia and Canada.
See http://www.refco.com/
The Debtor's affiliates, Refco Inc. and 23
entities, filed for chapter 11 protection on
Oct. 17, 2005 (Bankr. S.D.N.Y. Case No.
05-60006).
Chapter 7 Petition Date: November 25, 2005
Court: Southern District of New York (Manhattan)
Judge: Robert D. Drain
Debtor's Counsel: J. Gregory Milmoe, Esq.
Skadden, Arps, Slate, Meagher & Flom LLP
Four Times Square
New York, New York 10036
Tel: (212) 735-3770
Fax: (917) 777-3770
Estimated Assets: More than $100 Million
Estimated Debts: More than $100 Million
The Debtor did not file a list of its 20 largest unsecured
creditors.
SAINT VINCENTS: More Claimants Want to Prosecute Malpractice Suits
------------------------------------------------------------------
Four claimants ask the U.S. Bankruptcy Court for the Southern
District of New York to vacate the automatic stay to pursue claims
for medical malpractice that occurred at Saint Vincents Catholic
Medical Centers of New York and its debtor-affiliates' hospitals
in Staten Island and Queens.
1. Cherice Daniels
Cherice Daniels, on behalf of her infant son, Dante, commenced a
medical malpractice action in the New York State Supreme Court,
Richmond County, against several defendants, including St.
Vincent's Hospital, Staten Island, alleging malpractice in the
medical care provided to Dante.
Ms. Daniels seeks relief from the automatic stay to:
(a) continue prosecuting her action;
(b) proceed to trial with the proviso that any judgment
against the Debtors will not be enforced beyond the amount
of the Debtors' insurance coverage; and
(c) permit the Court to issue an order to enforce any excess
portion of a judgment against the Debtors to the extent it
exceeds the limits of insurance coverage.
2. Irene Stubbs
Irene Stubbs filed medical malpractice and personal injury claims
against the Debtors in the New York State Supreme Court, New York
County. Ms. Stubbs commenced her action against several
defendants, including the Debtors' Mary Immaculate Hospital in
Queens, alleging that she sustained an injury after she fell from
an ambulance.
Ms. Stubbs asks the Court to lift the automatic stay solely to
pursue whatever insurance policy or reserves the Debtors maintain
to pay personal injury claims.
Ms. Stubbs assures the Court that she does not otherwise seek to
recover from any other property of the Debtors.
3. Luis Mendoza
Luis Mendoza, as administrator of the estate of Teresa Mendoza,
is a litigant in a pending medical malpractice action in the New
York State Supreme Court, Queens County. Mr. Mendoza initiated
his action against an individual physician and the Debtors' Mary
Immaculate Hospital in Queens, alleging that medical malpractice
caused the personal injuries and death of his wife.
Mr. Mendoza wants the automatic stay modified so that discovery
and a potential trial in his action may proceed.
Mr. Mendoza says he will limit his recovery to any and all
available liability insurance coverage, and primary and excess
coverage, afforded to the Debtors.
Mr. Mendoza also seeks the right to sever the State action as
against the Debtors and proceed against the physician-defendant.
4. Aissatou Nian-Gaye
Aissatou Nian-Gaye filed a medical malpractice claim against the
Debtors in the United States District Court for the Eastern
District of New York. Ms. Nian-Gaye initiated her action against
several defendants, including St. Vincent's Hospital, Staten
Island, alleging that medical neglect in the delivery of her
child caused her a variety of injuries.
Ms. Nian-Gaye asks the Court to lift the stay so that she may
proceed with the prosecution of her action through trial or
settlement. Moreover, Ms. Nian-Gaye seeks leave to execute on
any recovery to the extent of the applicable insurance policies
without further order by the Court.
Ms. Nian-Gaye agrees to limit her recovery in the action solely
to the Debtors' applicable insurance coverage and agrees not to
invade their assets.
Debtors Object
Saint Vincent Catholic Medical Centers wants the four claimants'
requests denied.
SVCMC's medical malpractice insurance structure in Staten Island
is comprised of three tiers that operate together on an annual
basis:
(1) SVCMC employs primary insurance from third-party
providers;
(2) SVCMC has self-insured a portion of its malpractice
coverage, some of which is contained in insurance trusts;
and
(3) SVCMC has purchased excess insurance from unrelated third
parties.
Andrew M. Troop, Esq., Weil, Gotshal & Manges LLP, in New York,
relates that the Debtors' hospitals in Brooklyn and Queens are
fully self-insured. There is no third-party commercial insurance
coverage for the professional liability of these hospitals.
Accordingly, the Debtors are not only completely liable for
malpractice claims involving the Brooklyn and Queens hospitals,
but they also are responsible for all out-of-pocket expenses
related to any medical malpractice lawsuit, including defense
costs.
The Debtors also disagree to the lifting of the stay to the
extent that:
(a) the requests seek to pursue claims based on alleged
malpractice at their hospital in Brooklyn or Queens,
because there is no commercial insurance for these claims
and it could be detrimental to their estates to require
them to incur litigation expenses at this time; and
(b) any request seeks to enforce a judgment against the
Debtors or to sever an action to allow a claim to proceed
against an individual physician employed by the self-
insured Brooklyn or Queens hospitals.
Any liquidated claim against the Debtors will be paid as, when
and to the extent provided by any confirmed plan of
reorganization in their cases.
Mr. Troop adds that granting the lift stay requests of the
Medical Malpractice Claimants at this time would be premature.
The Motions should be adjourned until they can be considered on
their merits and in light of the Debtors' desire to be able to
develop and implement an overall plan for dealing with medical
malpractice claims generally.
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. 15; Bankruptcy Creditors' Service, Inc.,
215/945-7000)
SAINT VINCENTS: Stay Modified to Permit Decision on Merola's Plea
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
modified the automatic stay solely to the extent necessary to
permit the Appellate Division, Second Department, of the Supreme
Court of the State of New York, to render a decision regarding the
appeal filed Patsy Merola and to allow Mr. Merola to stipulate to
a lower claim against Saint Vincents Catholic Medical Centers of
New York and its debtor-affiliates based on the decision.
As reported in the Troubled Company on Oct. 28, 2005, Mr. Merola,
as administrator of the Estate of Wanda Merola, is a plaintiff in
a pending state action for wrongful death and pain and suffering
against Catholic Medical Center of Brooklyn and Queens Inc.
Mr. Merola obtained a $2,652,539 Judgment from the State Court on
October 9, 2003. The Judgment continues to accrue simple interest
at the statutory rate of 9%, according to Mr. Merola.
The Debtor appealed the entire Judgment to the Appellate Division.
To prevent Mr. Merola from enforcing the Judgment during the
pendency of the appeal, on November 12, 2003, the Debtor filed and
served Mr. Merola an "Undertaking on appeal from a Judgment
directing the payment of money", which was issued by Great
American Insurance Company. The Undertaking requires the issuer
to pay the Judgment, or any part of it, that is affirmed by the
Appellate Division, if the Debtor fails to pay the amount.
The Debtors seek to reduce various aspects of the damage awards
upon which the Judgment was based. Mr. Merola did not appeal any
aspect of the Judgment but only sought to have the Judgment
affirmed. After oral argument, the Appellate Division reserved
decision. The Appellate Court is precluded from rendering its
decision as a result of the Debtors' bankruptcy filing.
Mr. Merola also seeks relief from stay to permit him to stipulate
or accept any reduction of the damage award, and to enter a new
Judgment based on the reduced damage award, if necessary.
The need to stipulate can only benefit the Debtors by forever
limiting the Judgment to the amount of the reduced Judgment, Mr.
Suckle explains. In turn, should the Debtors emerge from
bankruptcy, the Debtors could seek further reduction in further
appeals should they so desire, while Mr. Merola would have
already stipulated to accept the reduced damage award and
Judgment precluding an appeal to reinstate the original higher
Judgment. The stipulation also allows Mr. Merola to have a
dollar amount to claim to Great American Insurance, and for all
parties in the bankruptcy case to know amount of the Merola
claim.
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)
SECURECARE TECH: Sept. 30 Balance Sheet Upside-Down by $1.8 Mil.
----------------------------------------------------------------
SecureCARE Technologies, Inc., formerly eClickMD, Inc., disclosed
its financial results for the quarter ended Sept. 30, 2005.
Revenue for the three months ended Sept. 30, 2005, was $108,774,
compared to $65,462 for the same period last year. This 66%
increase in revenue reflects a significant return on the
investments the Company made in the latter part of 2004 and in
2005 to expand its sales-force and its related sales and marketing
activities.
Revenues for the nine months ended Sept. 30, 2005, were $266,878
compared to $151,434 for the nine months ended Sept. 30, 2004.
This 76 percent increase in sales reflects a significant return on
the investments the Company made in the latter part of 2004 and in
2005 to expand its sales-force and its related sales and marketing
activities.
This strong marketplace momentum is reflected in the Company's
signed and billable home healthcare provider locations, totaling
136 locations at the end of September 2005.
Management believes that revenues will grow significantly over the
next twelve to eighteen months if the Company is able to raise the
additional capital required to execute its marketing and sales
strategy.
Costs of revenues was $203,926 for the three months ended
Sept. 30, 2005, compared to $131,225 for the three months ended
Sept. 30, 2004. This 55% increase in cost of revenues was
primarily attributable to increased operating lease expense and
higher amortization expense. In February 2005, the Company
entered into an operating lease for hardware and related software
to upgrade its entire production application and corporate
infrastructure. This resulted in an increase in operating lease
expense of approximately $49,000.
Costs of revenues were $640,489 for the nine months ended
Sept. 30, 2005 compared to $316,395 for the nine months ended
Sept. 30, 2004. This 102% increase in cost of revenues was
primarily attributable to an increase in headcount in the
technology and customer support departments, resulting in higher
payroll, payroll-related and employee benefits expense for the
period of approximately $141,000. These investments were made in
order to complete the initial development and on-going
enhancements and maintenance of the Company's SecureCARE.net
application, and to increase the resources deployed within
customer support and training to support significant revenue
growth during the period.
In February 2005, the Company completed development of
approximately $170,000 in internal use software, resulting in an
increase in amortization expense in 2005 of $21,250.
Selling, general and administrative expenses were $699,899 for the
three months ended September 30, 2005 compared to $476,850 for the
three months ended September 30, 2004.
Selling, general and administrative expenses were $1,871,203 for
the nine months ended September 30, 2005 compared to $1,156,365
for the nine months ended September 30, 2004.
Management expects that operating expenses will increase over the
next twelve to eighteen months if the Company is able to raise the
additional capital required to make the necessary investments in
technology enhancements and in its planned marketing, sales and
support programs.
Headquartered in Austin, Texa, SecureCARE Technologies, Inc.,
provides Internet-based document exchange and e-signature
solutions for the healthcare industry.
The Company's SecureCARE.net application is a secure, HIPAA-ready
(Health Insurance and Portability Act) tracking and reporting tool
that streamlines operations while providing physicians with
additional revenue opportunities.
As of Sept. 30, 2005, SecureCARE Technologies, Inc.'s equity
deficit increases to $1,880,817 compared to a $907,080 deficit at
Sept. 30, 2004.
SITESTAR CORP: Working Capital Deficit Fuels Going Concern Doubt
----------------------------------------------------------------
Sitestar Corp. delivered its quarterly 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 $116,524 of net income on $780,793 of net
revenues for the quarter ending Sept. 30, 2005. At Sept. 30,
2005, the company's balance sheet shows $3,694,739 in total assets
and $574,151 of positive stockholders equity.
As of Sept. 30, 2005, the company had a working capital deficit of
$1,943,832. That condition raises substantial doubt about the
company's ability to continue as a going concern.
Bagell, Josephs & Company, L.L.C., the company's auditor,
expressed substantial doubt in the company's ability to continue
as a going concern, after it audited the company's 2003 and 2004,
financial statements, pointing to the company's working capital
deficit.
A full-text copy of Sitestar's Form 10-QSB for the quarterly
period ended Sept. 30, 2005, is available at no charge at
http://ResearchArchives.com/t/s?33b
Sitestar Corporation, a holding company, provides Internet and
computer services to business and residential customers primarily
in the United States. The company's services include narrow and
broadband Internet access, toner recharge, custom networking,
technical consulting, ecommerce integration, Web application
development, and commercial-residential Internet services.
TECH DATA: Earns $23 Million in Third Quarter Ending Oct. 31
------------------------------------------------------------
Tech Data Corporation (NASDAQ:TECD) reported results for the third
quarter ended Oct. 31, 2005.
Net sales for the third quarter ended Oct. 31, 2005, were
$5.1 billion, an increase of 6.6% from $4.8 billion in the third
quarter of fiscal 2005.
The company reported net income, on a GAAP basis, of $23 million
for the third quarter of fiscal 2006, compared to net income of
$37.8 million for the prior year period.
"Our focused restructuring efforts in EMEA are delivering
measurable operating improvements as demonstrated by our
third-quarter results," Steven A. Raymund, Tech Data's chairman
and chief executive officer, commented. "We continue to generate
industry-leading growth and operating results in the Americas --
underscoring our position as a leading IT distributor. While we
are pleased with the improvements we've made in our business,
there is more work to be done. Through continued discipline and
process enhancements, we expect to drive better worldwide
operating results in the quarters ahead."
Share Repurchase Program
The company's Board of Directors has authorized the expansion of
its existing share repurchase program. Under the expanded
program, the company is authorized to repurchase in aggregate up
to $200 million of common stock. During the third quarter, the
company purchased 1.5 million shares of common stock at a cost of
$54.8 million, bringing its total shares repurchased during fiscal
2006 under the program to 2.8 million shares at a value of $100
million.
EMEA Restructuring Program
The company recorded $4.8 million of charges during the third
quarter of fiscal 2006 related to its EMEA restructuring program
which were comprised of $4.3 million related to workforce
reductions and $500,000 related to facility consolidations.
Year-to-date, the company has recorded $24.1 million in
restructuring charges and anticipates generating future annualized
savings of approximately the same amount. The program and related
actions are designed to better align the EMEA operating cost
structure with the current business environment. Excluding
consulting costs, the company expects to incur total charges in
the range of $40 million to $50 million related to the EMEA
restructuring program and generate annualized savings in the same
range.
"Tech Data's solid balance sheet and available cash provide the
company with the flexibility to support a stock repurchase program
while continuing to invest in our worldwide business," Jeffery P.
Howells, executive vice president and chief financial officer,
commented. "Combined with the company's EMEA restructuring
program efforts, our share repurchase program provides a solid
platform for increased shareholder value over the long-term."
Nine-month Results
Net sales for the nine-month period ended Oct. 31, 2005, were
$15 billion, an increase of 5.8 percent from $14.2 billion in the
nine-month period ended Oct. 31, 2004.
Gross margin for the nine-month period was 5.28%, down from 5.69%
in the prior-year comparable period.
Operating income, on a GAAP basis, for the nine-month period ended
Oct. 31, 2005, was $111.8 million, or .75% of net sales, compared
with $160.2 million, or 1.13% of net sales, in the prior year.
For the nine-month period ended Oct. 31, 2005, the company
incurred a net loss of $2.9 million, on a GAAP basis, compared
with net income of $103.1 million in the prior year.
Founded in 1974, Tech Data Corporation -- http://www.techdata.com/
-- is a leading distributor of IT products, with more than 90,000
customers in over 100 countries. The company's business model
enables technology solution providers, manufacturers and
publishers to cost-effectively sell to and support end users
ranging from small-to-midsize businesses to large enterprises.
Ranked 110th on the FORTUNE 500(R), Tech Data generated
$19.8 billion in net sales for its fiscal year ended
Jan. 31, 2005.
Tech Data Corp.'s 2% Convertible Subordinated Debentures due 2021
carry Moody's Investors Service's Ba2 rating, Standard & Poor's
BB+ rating and Fitch Ratings' BB rating.
THERMA-WAVE: Incurs $4.1 Million Net Loss in Second Quarter
-----------------------------------------------------------
Therma-Wave, Inc., (NASDAQ:TWAV) reported financial results for
the fiscal second quarter 2006 ended Oct. 2, 2005.
Net revenues for the fiscal second quarter of 2006 were
$17.3 million compared to net revenues of $17.5 million reported
for the fiscal first quarter of 2006, ended July 3, 2005.
Therma-Wave reported a $4.1 million net loss for the three months
ended Sept. 30, 2005, compared to net income of $1.3 million for
the same period in 2004. The second quarter 2006 net loss
includes a nominal benefit from the variable accounting treatment
of certain stock options and restructuring charges of
approximately $2.3 million. For the nine months ended Sept. 30,
2005, the Company incurred $1.7 million of net loss compared to
net income of $148,000 for the period ended Sept. 30, 2004.
The Company reported operating losses of $4.3 million and
$5.9 million for the second and first quarters of fiscal 2006,
respectively, and an operating loss of $6.5 million for its fiscal
year ended March 31, 2005. Gross margin for the fiscal second
quarter of 2006 was 34% compared to 41% in the fiscal first
quarter of 2006. The sequential decrease in fiscal second quarter
gross margin was primarily related to additional inventory
provisions of $1.6 million for customer service inventory and
manufacturing inventory.
"The strategic initiatives management implemented during the first
half of fiscal 2006 are yielding positive and measurable results,"
Boris Lipkin, Therma-Wave's president and chief executive officer
stated. "With better than forecasted revenues and reduced cash
consumption, as well as bottom line results in line with
management's expectations, we achieved notable operating
improvements during the quarter. Operating expenses as well as
cash consumption were reduced significantly during the quarter as
we took further steps to improve our cash position in order to
provide additional financial flexibility moving forward. We
intend to build on the improvements achieved during the first half
of fiscal 2006, as we remain focused on driving further gains in
operating efficiencies as well as increasing the market
penetration of our advanced metrology solutions among customers
worldwide. We stand fully committed to our stated goals of
achieving quarterly profitability and positive cash flow."
At Sept. 30, 2005, Therma-Wave had $55.4 million in total assets
and liabilities of $30.1 million. The Company has an accumulated
deficit of $309.5 million at Sept. 30, 2005.
Cash and cash equivalents totaled $14.5 million as of Oct. 2,
2005, compared to $13.2 million as of July 3, 2005. Fiscal second
quarter cash includes $5 million received during the quarter in
conjunction with a term loan with Silicon Valley Bank aimed at
bolstering cash reserves and improving financial flexibility.
Cash consumption, net of borrowings, during the fiscal second
quarter was $3.7 million representing a 59% sequential reduction
in cash consumption. Fiscal second quarter 2006 cash consumption
was more favorable than management's projected guidance of $4
million to $7 million.
Third Quarter Guidance
The Company provided guidance for the fiscal third quarter of 2006
ending Jan. 1, 2006:
-- revenue is expected to be in the range of $15 million to
$18 million.
-- diluted net loss per share is expected to be within the
range of $(0.08) to $(0.03), including provisions for
interest on debt, excluding non-cash charges or credits for
variable accounting of stock options (which will depend on
the Company's stock price) and any restructuring charges.
-- New orders are expected to be in a range of $14 million to
$17 million.
-- Cash consumption for the fiscal third quarter is expected
to be in the range of $3.0 million to $4.5 million. The
Company continues to focus on becoming cash neutral in the
near-term.
Material Weakness
In the fourth quarter of fiscal 2005, Therma-Wave identified two
material weaknesses in its internal controls:
1) as of April 3, 2005, the Company did not maintain
effective controls over intercompany accounts.
Specifically, the Company did not have effective controls
to ensure that intercompany account balances were
reconciled timely and properly eliminated in consolidation
in accordance with generally accepted accounting
principles.
2) as of April 3, 2005, the Company did not maintain
effective controls over the review and approval of journal
entries. Specifically, a manual journal entry to allocate
certain customer service and support costs between costs
of revenues and selling, general and administrative
expense was not properly documented, reviewed and
approved.
In view of these two material weaknesses found in the fourth
quarter of fiscal 2005, the Company's management concluded that
the Company's disclosure controls and procedures were not
effective as of Oct. 2, 2005.
Going Concern Doubt
As reported in the Troubled Company Reporter on July 7, 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.
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.
USN CORP: Sept. 30 Balance Sheet Upside-Down by $5.1 Million
------------------------------------------------------------
USN Corporation delivered its quarterly report on Form 10-QSB
for the quarter ending Sept. 30, 2005, to the Securities and
Exchange Commission on Nov. 21, 2005.
The company reported a $2,967,508 net loss on $6,339,103 of
product sales for the quarter ending Sept. 30, 2005.
At Sept. 30, 2005, the company's balance sheet showed $8,528,941
in total assets and a $5,112,627 stockholders deficit.
Going Concern Doubt
At Sept. 30, 2005, the company had a working capital deficit of
$5,169,261. The company had a net loss of $5,264,333 for the six
months ended Sept. 30, 2005, and a net loss of $5,804,666 for the
fiscal year ended March 31, 2005. The company disclosed that it
does not have sufficient cash flows from its operations to meet
its obligations currently due within the next 12 months. These
conditions raise substantial doubt about the company's ability to
continue as a going concern.
A full-text copy of the regulatory filing is available at no
charge at http://ResearchArchives.com/t/s?33a
Headquartered in Los Angeles, California, USN Corporation, through
its wholly owned subsidiary, USN Television Group, Inc. --
http://www.usntvg.com/,is a retailer of consumer products, such
as jewelry, watches, coins and other collectibles, through
interactive electronic media using broadcast, cable and satellite
television and the Internet. USN TV's programming is transmitted
by satellite to cable television systems, direct broadcast
satellite systems, including DirecTV, and television broadcasting
stations across the United States. USN TV also markets its
products through the Internet. Revenues are primarily generated
from sales of merchandise offered through USN TV's television home
shopping programming.
VITAL LIVING: Equity Deficit Narrows to $18.7-Mil at Sept. 30
-------------------------------------------------------------
Vital Living, Inc., delivered its financial statements for the
quarterly period ended Sept. 30, 2005, with the Securities and
Exchange Commission on Nov. 14, 2005.
The company reported a $1,161,000 net loss for the nine months
ended Sept. 30, 2005, compared with a $19,508,000 net loss for the
nine months ended Sept. 30, 2004.
For the nine months ended September 30, 2005, the company's
revenue was $4,330,000 compared with $2,716,000 for the nine
months ended Sept. 30, 2004, an increase of $1,614,000.
Cash flows used in operating activities was $355,000 and
$2,729,000 during the nine months ended Sept. 30, 2005, and 2004,
respectively. The $2,374,000 decrease in the nine months ended
Sept. 30, 2005, resulted from the ongoing cost containment and
expense management program combined with the effects of the
consolidation of our operations into our Phoenix, Arizona offices.
As of September 30, 2005, the Company's equity deficit narrowed to
$18,709,000 from a $19,915,000 deficit at December 31, 2004.
Going Concern Doubt
As reported in the Troubled Company Reporter on May 6, 2005,
Epstein Weber & Conover PLC, Vital Living's accountants, raised
substantial doubt about the Company's ability to continue as a
going concern after it audited the company's financial statements
for the fiscal year ended Dec. 31, 2004. The auditing firm
pointed to the company's recurring losses from operations, a
working capital deficit, and the company's dependency on funding
sources from other than operations.
For these reasons, the company is required to raise additional
capital by the issuance of both equity and debt instruments.
Headquartered in Phoenix, Airzona, Vital Living, Inc. --
http://www.vitalliving.com/-- develops and markets nutritional
fruit and vegetable supplements, protein supplements, and
nutraceuticals products. Through a licensing agreement, the
Company also has rights to use a pharmaceutical delivery system
known as "GEOMATRIX." Vital Living's principal products currently
are Greensfirst(R), Dream Protein(R), and Complete Essentials(R).
At Dec. 31, 2004, the company's balance sheet showed $26.1 million
in assets. The company reported a $28.5 million net loss on
$4.1 million of revenue in 2004.
WESTPOINT STEVENS: Beal Bank Wants Payment of Fees & Expenses
-------------------------------------------------------------
Gregory G. Hesse, Esq., at Jenkens & Gilchrist, in Dallas, Texas,
tells the Hon. Robert D. Drain of the U.S. Bankruptcy Court for
the Southern District of New York that WestPoint Stevens, Inc.,
and its debtor-affiliates have not paid Beal Bank, S.S.B., as
successor First Lien Agent and Collateral Trustee, its fees for
August, September, October, and November 2005. In addition, the
Debtors have not paid expenses incurred by Beal Bank. The Final
Order providing Prepetition Secured Lenders adequate protection,
entered on June 18, 2003, requires the Debtors to pay these fees
and expenses.
The Debtors owe Beal Bank fees amounting to about $400,000 for
August, September, October and November 2005, Mr. Hesse says.
Furthermore, Mr. Hesse continues, the Debtors are indebted for
Beal Bank's expenses, which include:
* Jenkens & Gilchrist P.C.'s legal fees & expenses through
October 31, 2005, aggregating $432,597; and
* Pitney Hardin, LLP's legal fees & expenses through
October 31, 2005, aggregating $64,488.
Mr. Hesse relates that prior to the closing of the sale of
substantially all the Debtors' assets on August 8, 2005, Beal
Bank submitted to WestPoint International, Inc., and WestPoint
Home, Inc., the Purchasers, invoices and other documentation to
support the amount of unpaid fees and expenses owed. However, the
Purchasers did not pay any of Beal Bank's unpaid fees and expenses
at the Closing. Since the Closing, counsel for Beal Bank has been
in contact with the Purchasers regarding the payment, but the fees
and expenses still remain unpaid.
Accordingly, Beal Bank asks the Court to direct the Debtors and
the Purchasers to promptly pay the unpaid sums.
Headquartered in West Point, Georgia, WestPoint Stevens, Inc., --
http://www.westpointstevens.com/-- is the #1 US maker of bed
linens and bath towels and also makes comforters, blankets,
pillows, table covers, and window trimmings. It makes the Martex,
Utica, Stevens, Lady Pepperell, Grand Patrician, and Vellux
brands, as well as the Martha Stewart bed and bath lines; other
licensed brands include Ralph Lauren, Disney, and Joe Boxer.
Department stores, mass retailers, and bed and bath stores are its
main customers. (Federated, J.C. Penney, Kmart, Sears, and Target
account for more than half of sales.) It also has nearly 60 outlet
stores. Chairman and CEO Holcombe Green controls 8% of WestPoint
Stevens. The Company filed for chapter 11 protection on
June 1, 2003 (Bankr. S.D.N.Y. Case No. 03-13532). John J.
Rapisardi, Esq., at Weil, Gotshal & Manges, LLP, represents the
Debtors in their restructuring efforts. (WestPoint Bankruptcy
News, Issue No. 59; Bankruptcy Creditors' Service, Inc.,
215/945-7000)
WINDSOR WOODMONT: Asks Court for Final Decree Closing Bankr. Case
-----------------------------------------------------------------
Michael L. Armstrong, the Continuing Estate Representative
appointed pursuant to Windsor Woodmont Black Hawk Resort
Corporation's Second Amended Plan of Reorganization asks the U.S.
Bankruptcy Court for the District of Colorado to enter a final
decree formally closing its bankruptcy case effective as of
Dec. 30, 2005.
The Court confirmed the Debtor's Plan on Dec. 22, 2004. Pursuant
to the confirmed Plan, the cash proceeds and Ameristar stock from
the Ameristar Sale were distributed to the Debtor's creditor and
interest holder classes. All claims and interests, with the
exception of the claims of the First Mortgage Noteholders, were
satisfied in full.
Mr. Armstrong tells the Court that entry of a final decree is
appropriate because:
1) the Confirmation Order has become final;
2) the Debtor has no ongoing business;
3) there were no deposits required under the Plan;
4) substantially all transfers of property and final
distributions under the Plan have been completed with the
few remaining transfers to be completed before Dec. 30,
2005; and
5) all motions, claim objections, contested matters, and
adversary proceedings have been resolved in this case.
Windsor Woodmont Black Hawk Resort Corporation, owner and
developer of Black Hawk Casino by Hyatt Casino in Black Hawk,
Colorado, filed for chapter 11 protection on November 7, 2002
(Bankr. Colo. Case No. 02-28089). Jeffrey M. Reisner, Esq., at
Irell & Manella LLP, represents the Debtor in its restructuring
efforts. When the Company filed for protection from its
creditors, it listed $139,414,132 in total assets and $152,546,656
in total debts.
WINDSWEPT ENVIRONMENTAL: Posts $1.2 Mil. Net Loss in Third Quarter
------------------------------------------------------------------
Windswept Environmental Group Inc. delivered its quarterly report
on Form 10-Q for the quarter ending Sept. 27, 2005, to the
Securities and Exchange Commission on Nov. 21, 2005.
The company reported a $1,239,781 net loss on $5,164,339 of net
revenues for the quarter ending Sept. 27, 2005. At Sept. 27,
2005, the company's balance sheet shows $16,114,886 in total
assets and $10,562,875 in total debts.
Going Concern Doubt
The company has incurred recurring losses from operations and is
experiencing difficulty in generating sufficient cash flow to meet
its obligations and sustain its operations, which raises
substantial doubt about the company's ability to continue as a
going concern.
As of Sept. 27, 2005, the company had a cash balance of $147,493,
working capital of $2,597,138 and stockholders' equity of
$5,552,011.
A full-text copy of the regulatory filing is available at no
charge at http://ResearchArchives.com/t/s?335
Windswept Environmental Group, Inc., through its wholly owned
subsidiary, Trade-Winds Environmental Restoration, Inc., --
http://www.tradewindsenvironmental.com/-- provides a full array
of emergency response, remediation, disaster restoration and
commercial drying services to a broad range of clients.
WINN-DIXIE: Will Abandon Unsold Burdensome FF&E at Targeted Stores
------------------------------------------------------------------
D.J. Baker, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, in
New York, relates that since the bankruptcy filing, Winn-Dixie
Stores, Inc., and its debtor-affiliates have rejected at least 180
store leases. The Debtors and their financial advisors have also
identified another 326 stores that are either in markets from
which the Debtors are exiting or are, nevertheless, unprofitable.
The Debtors continue to market the Targeted Stores and will reject
the lease for each Targeted Store the Debtors are unable to sell.
Once the Targeted Stores are sold or closed, the Debtors will be
left with 587 stores located in Florida, Alabama, Louisiana,
Mississippi, Georgia and the Bahamas.
The Debtors employed Hilco Merchant Resources, LLC, and Gordon
Brothers Retail Partners, LLC, to assist them in liquidating the
inventory and furniture, fixtures and equipment at the Targeted
Stores. The Agents are presently conducting going out of
business sales at the Targeted Stores and selling inventory and
FF&E to the general public.
According to Mr. Baker, in the event the Debtors are unable to
sell the FF&E, it would cost them more money to remove the FF&E
from the Targeted Stores than they would receive from a
subsequent sale of the FF&E. The Debtors are also at risk of
incurring additional administrative obligations in the form of
rent and other overhead until the FF&E is removed. The remaining
FF&E will be burdensome to the estates and of inconsequential
value.
Thus, the Debtors intend to abandon the FF&E to the applicable
landlords pursuant to Section 554(a) of the Bankruptcy Code.
At least 12 parties have filed objections to the notice,
including:
-- Webber Commercial Properties, LLC,
-- 12th Street & Washington Associates
-- Catamount Atlanta, LLC,
-- Principal Life Insurance Company,
-- Pascagoula Properties, Ltd.,
-- Heritage SBE, LLC,
-- Pinetree Partners, LLC,
-- THC, LLC,
-- Allied Capital Corporation,
-- CWCapital Asset Management, LLC,
-- CRIIMI Mae Services Limited Partnership, and
-- ORIX Capital Markets, LLC.
The objecting parties complain that the Debtors did not state in
the Notice the deadline for selling the FF&E before the Debtors
will abandon them to the lessors.
Headquartered in Jacksonville, Florida, Winn-Dixie Stores, Inc.
-- http://www.winn-dixie.com/-- is one of the nation's largest
food retailers. The Company operates stores across the
Southeastern United States and in the Bahamas and employs
approximately 90,000 people. The Company, along with 23 of its
U.S. subsidiaries, filed for chapter 11 protection on Feb. 21,
2005 (Bankr. S.D.N.Y. Case No. 05-11063, transferred Apr. 14,
2005, to Bankr. M.D. Fla. Case Nos. 05-03817 through 05-03840).
D.J. Baker, Esq., at Skadden Arps Slate Meagher & Flom LLP, and
Sarah Robinson Borders, Esq., and Brian C. Walsh, Esq., at King &
Spalding LLP, represent the Debtors in their restructuring
efforts. When the Debtors filed for protection from their
creditors, they listed $2,235,557,000 in total assets and
$1,870,785,000 in total debts. (Winn-Dixie Bankruptcy News,
Issue No. 27; Bankruptcy Creditors' Service, Inc., 215/945-7000).
WINSTAR COMMS: Clifford Chance Approved as Ch. 7 Trustee's Counsel
------------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware gave
Christine Shubert, the Chapter 7 Trustee for Winstar
Communications and its debtor-affiliates, permission to employ
Clifford Chance as her special counsel, effective as of May 23,
2005.
As the Trustee's special counsel, Clifford Chance will:
(a) represent and assist the Trustee in carrying out her
duties with respect to the Claims filed against Winstar
B.V.;
(b) attend the creditors meeting;
(c) explain and defend the Claims to other creditors and the
Liquidator; and
(d) monitor the liquidation process and ensure that any
distributions are paid out to the Debtors' estates.
Mr. Rennie relates that compensation will be payable to Clifford
Chance on an hourly basis at its normal and customary hourly
rates, plus reimbursement of actual, necessary expenses and other
charges incurred by the firm.
The principal attorneys and paralegals presently designated to
represent the Trustee and their hourly rates are:
Jan Hendrik Crucq EUR500
Diederik Bos EUR225
Jan Hendrik Crucq, Esq., a member of Clifford Chance's Amsterdam
office, assures the Court that the firm does not hold nor
represent any interest adverse to the Debtors and their estates.
Thus, Clifford Chance is a "disinterested person" as defined in
Section 101(14) of the Bankruptcy Code.
Headquartered in New York, New York, Winstar Communications, Inc.,
provides broadband services to business customers. The Company
and its debtor-affiliates filed for chapter 11 protection on April
18, 2001 (Bankr. D. Del. Case Nos. 01-01430 through 01-01462).
The Debtors obtained the Court's approval converting their case to
a chapter 7 liquidation proceeding in January 2002. Christine C.
Shubert serves as the Debtors' chapter 7 trustee. When the
Debtors filed for bankruptcy, they listed $4,975,437,068 in total
assets and $4,994,467,530 in total debts. (Winstar Bankruptcy
News, Issue No. 70; Bankruptcy Creditors' Service, Inc.,
215/945-7000)
WORLDCOM INC: Eduardo Jordan Wants Stay Lifted to Pursue Damages
----------------------------------------------------------------
Gladys A. Cardenas, Esq., tells the U.S. Bankruptcy Court for the
Southern District of New York that on May 16, 2002, William Marin,
an employee of MCI/WorldCom, while driving the Company's vehicle,
hit Eduardo Jordan.
Mr. Jordan filed an automobile negligence case against the Debtor,
seeking to recover an amount from the Debtor's policy limits. The
case is currently pending in Miami-Dade County
Circuit Court.
At the time of the accident, the Debtor was insured through Zurich
American Insurance Company with a $2,000,000 liability limit, Ms.
Cardenas asserts.
Accordingly, Mr. Jordan asks the Court to lift the stay to allow
them to pursue damages within the Debtor's policy limits.
Headquartered in Clinton, Mississippi, WorldCom, Inc., now known
as MCI -- http://www.worldcom.com/-- is a pre-eminent global
communications provider, operating in more than 65 countries and
maintaining one of the most expansive IP networks in the world.
The Company filed for chapter 11 protection on July 21, 2002
(Bankr. S.D.N.Y. Case No. 02-13532). On March 31, 2002, the
Debtors listed $103,803,000,000 in assets and $45,897,000,000 in
debts. The Bankruptcy Court confirmed WorldCom's Plan on
October 31, 2003, and on April 20, 2004, the company formally
emerged from U.S. Chapter 11 protection as MCI, Inc. (WorldCom
Bankruptcy News, Issue No. 108; Bankruptcy Creditors' Service,
Inc., 215/945-7000)
* BOND PRICING: For the week of Nov. 21 - Nov. 25, 2005
-------------------------------------------------------
Issuer Coupon Maturity Price
------ ------ -------- -----
Adelphia Comm. 3.250% 05/01/21 3
Adelphia Comm. 6.000% 02/15/06 3
Adelphia Comm. 7.500% 01/15/04 58
Adelphia Comm. 7.750% 01/15/09 57
Adelphia Comm. 7.875% 05/01/09 59
Adelphia Comm. 8.125% 07/15/03 56
Adelphia Comm. 8.375% 02/01/08 56
Adelphia Comm. 9.375% 11/15/09 60
Adelphia Comm. 9.500% 02/15/04 58
Adelphia Comm. 9.875% 03/01/05 56
Adelphia Comm. 9.875% 03/01/07 57
Adelphia Comm. 10.250% 11/01/06 60
Adelphia Comm. 10.250% 06/15/11 63
Adelphia Comm. 10.500% 07/15/04 58
Adelphia Comm. 10.875% 10/01/10 59
AHI-DFLT 07/05 8.625% 10/01/07 45
Aladdin Gaming 13.500% 03/01/10 0
Albertson's Inc. 7.000% 07/21/17 74
Allegiance Tel. 11.750% 02/15/08 23
Allegiance Tel. 12.875% 05/15/08 25
Alloy Inc 5.375% 08/01/23 74
Amer & Forgn PWR 5.000% 03/01/30 69
Amer Color Graph 10.000% 06/15/10 68
Amer Plumbing 11.625% 10/15/08 15
American Airline 7.379% 05/23/16 67
American Airline 8.390% 01/02/17 74
American Airline 8.800% 09/16/15 65
American Airline 9.980% 01/02/15 67
American Airline 9.980% 01/02/15 67
American Airline 9.980% 01/02/15 67
American Airline 10.180% 01/02/13 67
American Airline 10.430% 09/15/08 70
American Airline 10.430% 09/15/08 70
American Airline 10.850% 03/15/09 65
Amer Restaurant 11.500% 11/01/06 25
Ames True Temper 10.000% 07/15/12 75
AMR Corp. 9.750% 08/15/21 60
AMR Corp. 9.800% 10/01/21 75
AMR Corp. 9.880% 06/15/20 61
AMR Corp. 10.000% 04/15/21 63
AMR Corp. 10.130% 06/15/11 67
AMR Corp. 10.150% 05/15/20 58
AMR Corp. 10.200% 03/15/20 67
AMR Corp. 10.400% 03/10/11 75
AMR Corp. 10.420% 03/10/11 73
Amscan Hldgs Inc. 8.750% 05/01/14 74
Anchor Glass 11.000% 02/15/13 70
Antigenics 5.250% 02/01/25 45
Anvil Knitwear 10.875% 03/15/07 55
Apple South Inc. 9.750% 06/01/06 3
Armstrong World 6.350% 08/15/03 73
Armstrong World 6.500% 08/15/05 71
Armstrong World 7.450% 05/15/29 73
Armstrong World 9.000% 06/15/04 73
Amtran Inc. 9.625% 12/15/05 4
Asarco Inc. 7.875% 04/15/13 62
Asarco Inc. 8.500% 05/01/25 50
At Home Corp. 4.750% 12/15/06 0
Atlantic Coast 6.000% 02/15/34 6
Atlas Air Inc 8.770% 01/02/11 62
Autocam Corp. 10.875% 06/15/14 66
Bank New England 8.750% 04/01/99 7
Budget Group Inc. 9.125% 04/01/06 0
Burlington North 3.200% 01/01/45 58
Burlington Inds 7.250% 09/15/05 2
Burlington Inds 7.250% 08/01/25 2
Calpine Corp. 4.000% 12/26/03 45
Calpine Corp. 4.750% 11/15/23 28
Calpine Corp. 7.625% 04/15/06 64
Calpine Corp. 7.750% 04/15/09 41
Calpine Corp. 7.875% 04/01/08 43
Calpine Corp. 8.500% 07/15/10 73
Calpine Corp. 8.500% 02/15/11 35
Calpine Corp. 8.625% 08/15/10 34
Calpine Corp. 8.750% 07/15/07 43
Calpine Corp. 8.750% 07/15/13 72
Calpine Corp. 9.875% 12/01/11 73
Calpine Corp. 10.500% 05/15/06 65
CD Radio Inc. 8.750% 09/29/09 0
Cell Therapeutic 5.750% 06/15/08 56
Cell Therapeutic 5.750% 06/15/08 51
Cellstar Corp. 12.000% 01/15/07 0
Cendant Corp 4.890% 08/17/06 50
Charter Comm Hld 10.000% 05/15/11 60
Charter Comm Hld 11.125% 01/15/11 61
CIH 10.000% 05/15/14 64
CIH 11.125% 01/15/14 64
Ciphergen 4.500% 09/01/08 75
Clark Material 10.750% 11/15/06 0
Collins & Aikman 10.750% 12/31/11 44
Comcast Corp. 2.000% 10/15/29 39
Constar Intl 11.000% 12/01/12 72
Cons Container 10.125% 07/15/09 69
Cooper Standard 8.375% 12/15/14 73
Covad Communication 3.000% 03/15/24 57
Cray Inc. 3.000% 12/01/24 55
Cray Research 6.125% 02/01/11 30
Curagen Corp. 4.000% 02/15/11 74
Curagen Corp. 4.000% 02/15/11 74
Curative Health 10.750% 05/01/11 68
DAL-DFLT09/05 9.000% 05/15/16 17
Dana Corp 5.850% 01/15/15 72
Dana Corp 7.000% 03/15/28 72
Dana Corp 7.000% 03/01/29 72
Decrane Aircraft 12.000% 09/30/08 50
Delco Remy Intl 9.375% 04/15/12 37
Delco Remy Intl 11.000% 05/01/09 41
Delta Air Lines 2.875% 02/18/24 17
Delta Air Lines 7.299% 09/18/06 62
Delta Air Lines 7.541% 10/11/11 60
Delta Air Lines 7.700% 12/15/05 19
Delta Air Lines 7.779% 01/02/12 72
Delta Air Lines 7.900% 12/15/09 20
Delta Air Lines 8.000% 06/03/23 17
Delta Air Lines 8.300% 12/15/29 18
Delta Air Lines 8.540% 01/02/07 28
Delta Air Lines 8.540% 01/02/07 26
Delta Air Lines 8.540% 01/02/07 22
Delta Air Lines 8.540% 01/02/07 28
Delta Air Lines 8.950% 01/12/12 43
Delta Air Lines 9.200% 09/23/14 41
Delta Air Lines 9.250% 12/27/07 19
Delta Air Lines 9.250% 03/15/22 20
Delta Air Lines 9.320% 01/02/09 55
Delta Air Lines 9.375% 09/11/07 55
Delta Air Lines 9.590% 01/12/17 40
Delta Air Lines 9.750% 05/15/21 18
Delta Air Lines 9.875% 04/30/08 63
Delta Air Lines 10.000% 08/15/08 19
Delta Air Lines 10.000% 05/17/08 42
Delta Air Lines 10.000% 05/17/09 39
Delta Air Lines 10.000% 05/17/09 39
Delta Air Lines 10.000% 06/01/10 44
Delta Air Lines 10.000% 06/01/10 50
Delta Air Lines 10.000% 06/01/10 61
Delta Air Lines 10.000% 12/05/14 19
Delta Air Lines 10.060% 01/02/16 53
Delta Air Lines 10.125% 05/15/10 19
Delta Air Lines 10.330% 03/26/06 27
Delta Air Lines 10.375% 02/01/11 19
Delta Air Lines 10.375% 12/15/22 18
Delta Air Lines 10.430% 01/02/11 41
Delta Air Lines 10.430% 01/02/11 41
Delta Air Lines 10.500% 04/30/16 56
Delta Air Lines 10.790% 09/26/13 41
Delta Air Lines 10.790% 03/26/14 14
Delta Air Lines 10.790% 03/26/14 41
Delphi Auto Syst 7.125% 05/01/29 55
Delphi Auto Syst 6.500% 05/01/29 55
Delphi Corp 6.500% 08/15/13 55
Delphi Trust II 6.197% 11/15/33 25
Diamond Brands 12.875% 04/15/09 0
Duane Reade Inc 9.750% 08/01/11 69
Dura Operating 9.000% 05/01/09 57
DVI Inc. 9.875% 02/01/04 10
E.Spire Comm Inc. 13.000% 11/01/05 0
Edison Brothers 11.000% 09/26/07 0
Empire Gas Corp. 9.000% 12/31/07 0
Epix Medical Inc. 3.000% 06/15/24 68
Exodus Comm. Inc. 10.750% 12/15/09 0
Exodus Comm. Inc. 11.625% 07/15/10 0
Falcon Products 11.375% 06/15/09 2
Fedders North AM 9.875% 03/01/14 74
Federal-Mogul Co. 7.375% 01/15/06 34
Federal-Mogul Co. 7.500% 01/15/09 34
Federal-Mogul Co. 8.160% 03/06/03 33
Federal-Mogul Co. 8.250% 03/03/05 33
Federal-Mogul Co. 8.330% 11/15/01 33
Federal-Mogul Co. 8.370% 11/15/01 31
Federal-Mogul Co. 8.800% 04/15/07 35
Finova Group 7.500% 11/15/09 36
FMXIQ-DFLT09/05 13.500% 08/15/05 3
Foamex L.P.-DFLT 9.875% 06/15/07 11
Foamex L.P./C-DFT 10.750% 04/01/09 72
Ford Motor Co. 6.500% 08/01/18 64
Ford Motor Co. 6.625% 02/15/28 64
Ford Motor Co. 7.125% 11/15/25 62
Ford Motor Co. 7.400% 11/01/46 61
Ford Motor Co. 7.700% 05/15/97 60
Ford Motor Co. 7.750% 06/15/43 62
Ford Motor Co. 8.875% 01/15/22 72
Ford Motor Co. 8.900% 01/15/32 70
Ford Motor Cred 4.400% 03/20/09 72
Ford Motor Cred 4.800% 07/20/09 72
Ford Motor Cred 4.900% 09/21/09 74
Ford Motor Cred 5.000% 09/21/09 75
Ford Motor Cred 5.000% 09/21/09 73
Ford Motor Cred 5.000% 02/22/11 70
Ford Motor Cred 5.150% 11/20/09 74
Ford Motor Cred 5.200% 03/21/11 70
Ford Motor Cred 5.250% 02/22/11 72
Ford Motor Cred 5.250% 03/21/11 74
Ford Motor Cred 5.250% 09/20/11 68
Ford Motor Cred 5.300% 03/21/11 70
Ford Motor Cred 5.350% 02/22/11 70
Ford Motor Cred 5.400% 09/20/11 71
Ford Motor Cred 5.400% 10/20/11 74
Ford Motor Cred 6.400% 10/20/11 72
Ford Motor Cred 6.450% 04/20/11 72
Ford Motor Cred 5.450% 10/20/11 69
Ford Motor Cred 5.500% 09/20/11 70
Ford Motor Cred 5.500% 10/20/11 73
Ford Motor Cred 5.550% 08/22/11 70
Ford Motor Cred 5.550% 09/20/11 74
Ford Motor Cred 5.600% 04/20/11 69
Ford Motor Cred 5.600% 08/21/11 74
Ford Motor Cred 5.600% 11/21/11 74
Ford Motor Cred 5.650% 05/20/11 72
Ford Motor Cred 5.650% 07/20/11 72
Ford Motor Cred 5.650% 11/21/11 69
Ford Motor Cred 5.650% 11/21/11 73
Ford Motor Cred 5.650% 12/20/11 73
Ford Motor Cred 5.650% 01/21/14 65
Ford Motor Cred 5.700% 03/22/10 74
Ford Motor Cred 5.700% 05/20/11 73
Ford Motor Cred 5.750% 08/22/11 73
Ford Motor Cred 5.750% 12/20/11 74
Ford Motor Cred 5.750% 01/21/14 63
Ford Motor Cred 5.750% 02/20/14 67
Ford Motor Cred 5.800% 08/22/11 69
Ford Motor Cred 5.850% 07/20/11 71
Ford Motor Cred 5.900% 02/21/12 72
Ford Motor Cred 5.900% 02/20/14 64
Ford Motor Cred 5.950% 05/20/10 75
Ford Motor Cred 6.000% 01/20/12 72
Ford Motor Cred 6.000% 01/21/14 66
Ford Motor Cred 6.000% 03/20/14 67
Ford Motor Cred 6.000% 03/20/14 69
Ford Motor Cred 6.000% 03/20/14 66
Ford Motor Cred 6.000% 03/20/14 73
Ford Motor Cred 6.000% 11/20/14 69
Ford Motor Cred 6.000% 11/20/14 67
Ford Motor Cred 6.000% 11/20/14 65
Ford Motor Cred 6.000% 01/20/15 64
Ford Motor Cred 6.050% 02/20/14 71
Ford Motor Cred 6.050% 06/20/11 72
Ford Motor Cred 6.050% 02/21/14 70
Ford Motor Cred 6.050% 03/20/14 66
Ford Motor Cred 6.050% 04/21/14 67
Ford Motor Cred 6.050% 12/22/14 68
Ford Motor Cred 6.050% 12/22/14 67
Ford Motor Cred 6.050% 12/22/14 70
Ford Motor Cred 6.050% 02/20/15 64
Ford Motor Cred 6.100% 02/20/15 70
Ford Motor Cred 6.150% 05/20/11 71
Ford Motor Cred 6.150% 12/22/14 66
Ford Motor Cred 6.150% 01/20/15 68
Ford Motor Cred 6.200% 04/21/14 67
Ford Motor Cred 6.200% 03/20/15 69
Ford Motor Cred 6.250% 06/20/11 74
Ford Motor Cred 6.250% 06/20/11 74
Ford Motor Cred 6.250% 12/20/13 75
Ford Motor Cred 6.250% 12/20/13 67
Ford Motor Cred 6.250% 04/21/14 70
Ford Motor Cred 6.250% 01/20/15 66
Ford Motor Cred 6.250% 03/20/15 67
Ford Motor Cred 6.300% 05/20/14 74
Ford Motor Cred 6.350% 04/21/14 73
Ford Motor Cred 6.500% 12/20/13 73
Ford Motor Cred 6.500% 02/20/15 66
Ford Motor Cred 6.500% 03/20/15 70
Ford Motor Cred 6.520% 03/10/13 70
Ford Motor Cred 6.600% 10/22/13 73
Ford Motor Cred 6.750% 10/21/13 71
Ford Motor Cred 6.750% 06/20/14 70
Ford Motor Cred 6.800% 06/20/14 74
Ford Motor Cred 6.800% 06/20/14 70
Ford Motor Cred 6.800% 03/20/15 67
Ford Motor Cred 6.850% 09/20/13 73
Ford Motor Cred 6.850% 06/20/14 73
Ford Motor Cred 6.950% 05/20/14 73
Ford Motor Cred 7.050% 09/20/13 72
Ford Motor Cred 7.100% 09/20/13 70
Ford Motor Cred 7.250% 07/20/17 67
Ford Motor Cred 7.250% 07/20/17 66
Ford Motor Cred 7.350% 09/15/15 68
Ford Motor Cred 7.900% 05/18/15 72
Gateway Inc. 1.500% 12/31/09 74
Gateway Inc. 2.000% 12/31/11 72
General Motors 7.125% 07/15/13 70
General Motors 7.400% 09/01/25 60
General Motors 8.100% 06/15/24 63
General Motors 8.250% 07/15/23 68
General Motors 8.375% 07/15/33 70
General Motors 8.800% 03/01/21 68
General Motors 9.400% 07/15/21 71
Gfsi Inc. 9.625% 03/01/07 74
GMAC 4.100% 03/15/09 74
GMAC 4.250% 03/15/09 73
GMAC 5.250% 01/15/14 68
GMAC 5.350% 01/15/14 69
GMAC 5.700% 06/15/13 75
GMAC 5.700% 12/15/13 67
GMAC 5.750% 01/15/14 74
GMAC 5.750% 06/15/13 71
GMAC 5.850% 06/15/13 70
GMAC 5.900% 12/15/13 72
GMAC 5.900% 01/15/19 64
GMAC 5.900% 01/15/19 66
GMAC 5.900% 02/15/19 63
GMAC 5.900% 10/15/19 60
GMAC 6.000% 07/15/13 71
GMAC 6.000% 11/15/13 71
GMAC 6.000% 12/15/13 73
GMAC 6.000% 02/15/19 66
GMAC 6.000% 02/15/19 61
GMAC 6.000% 02/15/19 65
GMAC 6.000% 03/15/19 69
GMAC 6.000% 03/15/19 65
GMAC 6.000% 03/15/19 64
GMAC 6.000% 03/15/19 64
GMAC 6.000% 03/15/19 63
GMAC 6.000% 04/15/19 64
GMAC 6.000% 09/15/19 65
GMAC 6.000% 09/15/19 67
GMAC 6.050% 08/15/19 65
GMAC 6.050% 08/15/19 64
GMAC 6.050% 10/15/19 74
GMAC 6.100% 05/15/13 74
GMAC 6.100% 09/15/19 63
GMAC 6.125% 10/15/19 65
GMAC 6.150% 12/15/13 72
GMAC 6.150% 08/15/19 61
GMAC 6.150% 09/15/19 60
GMAC 6.150% 10/15/19 62
GMAC 6.200% 11/15/13 73
GMAC 6.200% 04/15/19 65
GMAC 6.250% 03/15/13 74
GMAC 6.250% 10/15/13 73
GMAC 6.250% 11/15/13 74
GMAC 6.250% 12/15/18 66
GMAC 6.250% 01/15/19 70
GMAC 6.250% 04/15/19 72
GMAC 6.250% 05/15/19 63
GMAC 6.250% 07/15/19 60
GMAC 6.300% 03/15/13 71
GMAC 6.300% 11/15/13 72
GMAC 6.300% 08/15/19 65
GMAC 6.300% 08/15/19 64
GMAC 6.350% 04/15/13 65
GMAC 6.350% 07/15/19 67
GMAC 6.350% 07/15/19 65
GMAC 6.400% 12/15/18 67
GMAC 6.400% 11/15/19 70
GMAC 6.400% 11/15/19 69
GMAC 6.500% 03/15/13 71
GMAC 6.500% 04/15/13 68
GMAC 6.500% 06/15/18 67
GMAC 6.500% 11/15/18 66
GMAC 6.500% 12/15/18 69
GMAC 6.500% 12/15/18 70
GMAC 6.550% 05/15/19 68
GMAC 6.500% 01/15/20 64
GMAC 6.500% 02/15/20 70
GMAC 6.550% 12/15/19 69
GMAC 6.600% 08/15/16 73
GMAC 6.600% 05/15/18 68
GMAC 6.600% 06/15/19 68
GMAC 6.600% 06/15/19 68
GMAC 6.650% 06/15/18 68
GMAC 6.650% 10/15/18 67
GMAC 6.650% 10/15/18 73
GMAC 6.700% 07/15/12 72
GMAC 6.700% 05/15/14 74
GMAC 6.700% 06/15/14 72
GMAC 6.700% 08/15/16 72
GMAC 6.700% 08/15/18 69
GMAC 6.700% 06/15/18 69
GMAC 6.700% 11/15/18 67
GMAC 6.700% 06/15/19 67
GMAC 6.700% 12/15/19 67
GMAC 6.750% 11/15/09 75
GMAC 6.750% 10/15/11 70
GMAC 6.750% 04/15/13 74
GMAC 6.750% 06/15/14 75
GMAC 6.750% 06/15/14 75
GMAC 6.750% 07/15/16 73
GMAC 6.750% 09/15/16 71
GMAC 6.750% 06/15/17 69
GMAC 6.750% 03/15/18 72
GMAC 6.750% 07/15/18 70
GMAC 6.750% 09/15/18 71
GMAC 6.750% 10/15/18 69
GMAC 6.750% 11/15/18 65
GMAC 6.750% 05/15/19 72
GMAC 6.750% 05/15/19 67
GMAC 6.750% 06/15/19 72
GMAC 6.750% 06/15/19 70
GMAC 6.750% 03/15/20 69
GMAC 6.800% 02/15/13 74
GMAC 6.800% 09/15/18 70
GMAC 6.800% 10/15/18 67
GMAC 6.850% 05/15/18 68
GMAC 6.875% 08/15/16 71
GMAC 6.875% 07/15/18 72
GMAC 6.900% 07/15/18 72
GMAC 6.950% 06/15/17 72
GMAC 7.000% 06/15/16 74
GMAC 7.000% 06/15/16 74
GMAC 7.000% 09/15/16 74
GMAC 7.000% 05/15/17 73
GMAC 7.000% 05/15/17 73
GMAC 7.000% 06/15/17 73
GMAC 7.000% 07/15/17 74
GMAC 7.000% 07/15/17 71
GMAC 7.000% 03/15/18 73
GMAC 7.000% 05/15/18 72
GMAC 7.000% 08/15/18 68
GMAC 7.000% 09/15/18 71
GMAC 7.000% 02/15/21 69
GMAC 7.000% 09/15/21 70
GMAC 7.000% 09/15/21 68
GMAC 7.000% 06/15/22 65
GMAC 7.000% 11/15/23 66
GMAC 7.000% 11/15/24 64
GMAC 7.000% 11/15/24 63
GMAC 7.000% 11/15/24 69
GMAC 7.050% 05/15/17 72
GMAC 7.050% 03/15/18 72
GMAC 7.050% 03/15/18 73
GMAC 7.050% 04/15/16 72
GMAC 7.100% 09/15/12 72
GMAC 7.125% 04/15/17 74
GMAC 7.125% 07/15/17 74
GMAC 7.150% 07/15/17 73
GMAC 7.150% 01/15/25 67
GMAC 7.150% 03/15/25 66
GMAC 7.200% 10/15/17 72
GMAC 7.200% 10/15/17 65
GMAC 7.250% 03/15/17 70
GMAC 7.250% 05/15/17 74
GMAC 7.250% 07/15/17 74
GMAC 7.250% 09/15/17 74
GMAC 7.250% 01/15/18 74
GMAC 7.250% 04/15/18 72
GMAC 7.250% 04/15/18 74
GMAC 7.250% 08/15/18 73
GMAC 7.250% 09/15/18 66
GMAC 7.250% 01/15/25 69
GMAC 7.250% 03/15/25 67
GMAC 7.300% 12/15/15 74
GMAC 7.300% 12/15/17 67
GMAC 7.300% 01/15/18 74
GMAC 7.300% 01/15/18 69
GMAC 7.350% 03/15/17 75
GMAC 7.375% 04/15/17 73
GMAC 7.400% 02/15/21 73
GMAC 7.500% 12/15/12 69
GMAC 7.500% 04/15/17 75
GMAC 7.500% 11/15/17 72
GMAC 7.500% 12/15/25 74
GMAC 8.000% 03/15/25 70
Golden Northwest 12.000% 12/15/06 3
Graftech Int'l 1.625% 01/15/24 71
Gulf Mobile Ohio 5.000% 07/01/32 69
Home Interiors 10.125% 06/01/08 64
Huntsman Packag 13.000% 06/01/10 18
Imperial Credit 9.875% 01/15/07 0
Inland Fiber 9.625% 11/15/07 49
Integrat Elec SV 9.375% 02/01/09 52
Intermet Corp. 9.750% 06/15/09 38
Iridium LLC/CAP 10.875% 07/15/05 24
Iridium LLC/CAP 11.250% 07/15/05 21
Iridium LLC/CAP 13.000% 07/15/05 22
Iridium LLC/CAP 14.000% 07/15/05 22
Jts Corp. 5.250% 04/29/02 1
Kaiser Aluminum & Chem. 12.750% 02/01/03 5
Kmart Corp. 8.990% 07/05/10 25
Kmart Funding 9.440% 07/01/18 71
Kulicke & Soffa 1.000% 06/30/10 72
Level 3 Comm. Inc. 2.875% 07/15/10 68
Level 3 Comm. Inc. 6.000% 09/15/09 61
Level 3 Comm. Inc. 6.000% 03/15/10 61
Liberty Media 3.750% 02/15/30 55
Liberty Media 4.000% 11/15/29 60
Macsaver Financl 7.400% 02/15/02 0
Macsaver Financl 7.875% 08/01/03 0
Mcms Inc. 9.750 03/01/08 0
Merisant Co 9.500% 07/15/13 66
Metricom Inc. 13.000% 02/15/10 0
Motels of Amer 12.000% 04/15/04 66
Movie Gallery 11.000% 05/01/12 73
MSX Int'l Inc. 11.375% 01/15/08 71
Muzak LLC 9.875% 03/15/09 52
Natl Steel Corp. 8.375% 08/01/06 2
Natl Steel Corp. 9.875% 03/01/09 2
Nexprise Inc. 6.000 04/01/07 0
New Orl Grt N RR 5.000% 07/01/32 69
New World Pasta 9.250% 02/15/09 7
North Atl Trading 9.250% 03/01/12 72
Northern Pacific RY 3.000% 01/01/47 57
Northern Pacific RY 3.000% 01/01/47 57
Northwest Airlines 6.625% 05/15/23 36
Northwest Airlines 7.068% 01/02/16 69
Northwest Airlines 7.248% 01/02/12 18
Northwest Airlines 7.360% 02/01/20 68
Northwest Airlines 7.625% 11/15/23 36
Northwest Airlines 7.875% 03/15/08 35
Northwest Airlines 8.070% 01/02/15 21
Northwest Airlines 8.130% 02/01/14 23
Northwest Airlines 8.304% 09/01/10 72
Northwest Airlines 8.700% 03/15/07 35
Northwest Airlines 8.875% 06/01/06 35
Northwest Airlines 8.970% 01/02/15 16
Northwest Airlines 9.179% 04/01/10 25
Northwest Airlines 9.875% 03/15/07 37
Northwest Airlines 10.000% 02/01/09 35
Northwest Stl & Wir 9.500% 06/15/01 0
NTK Holdings Inc. 10.750% 03/01/14 60
NWA Trust 9.360% 03/10/06 64
Oakwood Homes 7.875% 03/01/04 10
Oakwood Homes 8.125% 03/01/09 10
Orion Network 11.250% 01/15/07 50
Orion Network 12.500% 01/15/07 35
Oscient Pharm 3.500% 04/15/11 74
Osu-Dflt10/05 13.375% 10/15/09 5
Owens-Crng Fiber 8.875% 06/01/02 69
PCA LLC/PCA Fin 11.875 08/01/09 23
Pegasus Satellite 9.625% 10/15/05 32
Pegasus Satellite 9.750% 12/01/05 25
Pegasus Satellite 12.375% 08/01/06 21
Pegasus Satellite 12.500% 08/01/06 25
Pegasus Satellite 13.500% 03/01/07 0
Pen Holdings Inc. 9.875% 06/15/08 65
Pinnacle Airline 3.250% 02/15/25 65
Piedmont Aviat 9.900% 11/08/06 0
Piedmont Aviat 10.000% 11/08/12 11
Pixelworks Inc. 1.750% 05/15/24 67
Pliant Corp. 13.000% 06/01/10 22
Polaroid Corp. 6.750% 01/15/02 0
Polaroid Corp. 7.250% 01/15/07 0
PRG-Schultz Intl 4.750% 11/26/06 49
Primedex Health 11.500% 06/30/08 57
Primus Telecom 3.750% 09/15/10 28
Primus Telecom 5.750% 02/15/07 52
Primus Telecom 8.000% 01/15/14 58
Primus Telecom 12.750% 10/15/09 51
Psinet Inc. 11.500% 11/01/08 0
RDM Sports Group 8.000% 08/15/03 0
Read-Rite Corp. 6.500% 09/01/04 20
Refco Finance 9.000% 08/01/12 73
Reliance Group Holdings 9.000% 11/15/00 21
Reliance Group Holdings 9.750% 11/15/03 1
Safety-Kleen Corp. 9.250% 06/01/08 0
Salton Inc. 12.250% 04/15/08 45
Solectron Corp. 0.500% 02/15/34 75
Solutia Inc. 6.720% 10/15/37 69
Solutia Inc. 7.375% 10/15/27 69
Speciaty PaperB 9.375% 10/15/07 75
Tekni-Plex Inc. 12.750% 06/15/10 57
Teligent Inc. 11.500% 12/01/07 0
Toys R Us 7.375% 10/15/18 70
Transtexas Gas 15.000% 03/15/05 1
Trism Inc. 12.000% 02/15/08 0
Triton Pcs Inc. 8.750% 11/15/11 74
Triton Pcs Inc. 9.375% 02/01/11 75
Tropical Sportsw 11.000% 06/15/08 0
United Air Lines 6.831% 09/01/08 69
United Air Lines 7.270% 01/30/13 46
United Air Lines 7.371% 09/01/06 35
United Air Lines 7.762% 10/01/05 44
United Air Lines 8.030% 07/01/11 69
United Air Lines 9.000% 12/15/03 15
United Air Lines 9.020% 04/19/12 54
United Air Lines 9.125% 01/15/12 15
United Air Lines 9.200% 03/22/08 52
United Air Lines 9.350% 04/07/16 62
United Air Lines 9.560% 10/19/18 55
United Air Lines 9.750% 08/15/21 15
United Air Lines 10.020% 03/22/14 58
United Air Lines 10.110% 01/05/06 51
United Air Lines 10.125% 03/22/15 58
United Air Lines 10.250% 07/15/21 16
United Air Lines 10.670% 05/01/04 15
United Air Lines 11.210% 05/01/14 15
Univ. Health Services 0.426% 06/23/20 57
US Air Inc. 10.250% 01/15/49 1
US Air Inc. 10.250% 01/15/49 4
US Air Inc. 10.250% 01/15/49 3
US Air Inc. 10.300% 07/15/49 8
US Air Inc. 10.550% 01/15/49 28
US Air Inc. 10.610% 06/27/07 0
US Air Inc. 10.680% 06/27/08 2
US Air Inc. 10.700% 01/15/49 27
US Air Inc. 10.700% 01/15/49 28
US Air Inc. 10.750% 01/15/49 6
US Air Inc. 10.800% 01/01/49 6
US Air Inc. 10.800% 01/01/49 5
Vitesse Semicond 1.500% 10/01/24 72
WCI Steel Inc. 10.000% 12/01/04 62
Werner Holdings 10.000% 11/15/07 41
Westpoint Steven 7.875% 06/15/05 0
Winn-Dixie Store 8.875% 04/01/08 74
Winstar Comm 10.000% 03/15/08 0
Winstar Comm 12.750% 04/15/10 0
World Access Inc. 4.500% 10/01/02 4
Xerox Corp 0.570% 04/21/18 41
*********
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
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re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers. Information contained
herein is obtained from sources believed to be reliable, but is
not guaranteed.
The TCR subscription rate is $675 for 6 months delivered via e-
mail. Additional e-mail subscriptions for members of the same firm
for the term of the initial subscription or balance thereof are
$25 each. For subscription information, contact Christopher Beard
at 240/629-3300.
*** End of Transmission ***