/raid1/www/Hosts/bankrupt/TCR_Public/020208.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Friday, February 8, 2002, Vol. 6, No. 28
Headlines
360NETWORKS: Acquires Urbanlink Assets via Non-Cash Transaction
ABRAXAS PETROLEUM: Venture Securities Discloses 7% Equity Stake
ACTIVE FIRE: Case Summary & 20 Largest Unsecured Creditors
ADVANCED MICRO: Fitch Junks Convertible Subordinated Rating
ALPNET: Issues 24.8MM Shares to SDL Pursuant to Planned Merger
AMTRAK: Cato Institute Report Calls for Chapter 11 Proceeding
BEAZER HOMES: S&P Affirms Low-B Post-Merger Agreement Ratings
BRIDGE INFO: Reaches Pact to Hire Lardner & Helfrey as Counsel
BURLINGTON INDUSTRIES: Committee Taps BDO Seidman as Advisors
CALICO COMMERCE: Closes Sale of Assets to PeopleSoft for $5MM
CLASSIC COMMS: Court Fixes Mar. 29 Bar Date for Proofs of Claim
COHO ENERGY: Chapter 11 Case Summary
COMDISCO INC: Selling Sub Debt Agreements to MetDent for $1MM+
COMMEMORATIVE BRANDS: S&P Keeps Watch on Low-B & Junk Ratings
COSERV ELECTRIC: Chapter 11 Case Summary
COUNCIL TRAVEL: Chapter 11 Case Summary
CRESCENT OPERATING: Machinery Unit Files Chapter 11 in Ft. Worth
CRESCENT MACHINERY: Chapter 11 Case Summary
EGAMES INC: Posts $5.7MM Operating Loss in FY 2001 Ended June 30
E.SPIRE COMMS: Seeks Approval to Extend Removal Period to Apr. 1
ENRON CORP: Seeks Approval to Hire Ordinary Course Professionals
ENRON PROPERTY: Case Summary & Largest Unsecured Creditors
ENRON: Bankr. Court to Hear from 401(k) Plaintiffs on Feb. 13
ENRON CORP: A.M. Best Says Bankruptcy Costs Insurers $3 Billion
EUPHONIX: Gets Shareholders' Nod to Restructure Promissory Notes
EXODUS COMMS: Court Okays Venture Asset as Marketing Agent
FEDERAL-MOGUL: US Trustee Amends Creditors' Committee Membership
FRUIT OF THE LOOM: Has Until June 30 to Act on Unexpired Leases
GLOBAL CROSSING: Gets Approval to Continue Funding Foreign Units
HARE KRISHNA: Will File for Chapter 11 Reorg. Later This Month
HAYES LEMMERZ: US Trustee Questions KPMG's Disinterestedness
HEAFNER TIRE: Ratings Still on Watch Neg. Following Tender Offer
IVC INDUSTRIES: No Date Yet for Special Shareholders' Meeting
IT GROUP: Seeks Court Approval to Sell Substantially All Assets
INTEGRATED HEALTH: Wants Removal Time Further Extended to May 27
INTERPLAY ENTERTAINMENT: Appoints Herve Caen as Interim CEO
KAISER ALUMINUM: Missed Payment Drags Ratings to Default Level
KMART CORP: Signs-Up PricewaterhouseCoopers as Financial Advisor
KMART: Will Talk About Store Closings at End of First Quarter
LTV CORP: Reaches Agreement to End Non-Union Retiree Benefits
LOEWS CINEPLEX: Asks Court for More Time to Decide on Leases
MARINER POST-ACUTE: Sale of Merrimack Facility to Amesbury OK'd
MAXXAM INC: Defers Q4 Financial Results Announcement
MCLEODUSA INC: Wins Nod to Continue Using Existing Bank Accounts
METALDYNE: S&P Revises Low-B Rating Outlook to Negative
METALS USA: Look for Schedules & Statements Around March 8
METRIS COMPANIES: Fitch Affirms BB+ Rating on Bank Facility
NORTHERN NATURAL: S&P Taking Harder Look At Pipeline's Ratings
NORTHLAND CRANBERRIES: Net Revenues Drop 39% to $125.8MM in 2001
ONSITE ACCESS: Committee Okays Solicitation Period Extension
ORIUS CORP: Fitch Slashes NATG Senior Subordinated Notes to D
PACIFIC GAS: DebtHolders Reserve Rights Re Tri-Party Agreement
PINNACLE HOLDINGS: Amends & Extends Facility Forbearance Pact
SAFETY-KLEEN CORP: Seeks Open-Ended Removal Period Extension
STOCKWALK GROUP: Will File Chapter 11 with Prepackaged Plan
SUN HEALTHCARE: Secures Okay to Hire Bloom Borenstein as Counsel
TECSTAR INC: EMCORE to Acquire Solar Cell Business for $21MM
TELESYSTEM INT'L: Recapitalization Plan Nearing Completion
UBRANDIT.COM: Case Summary & 20 Largest Unsecured Creditors
WARNACO GROUP: Plan Filing Exclusive Period Extended to May 8
WHEELING-PITTSBURGH: Hires Tatum CFO for Short-Term Consulting
WOLVERINE TUBE: Lenders Waive Revolver's Financial Covenants
WORLD WIDE WIRELESS: Celeste Trust Discloses 9.99% Equity Stake
* BOOK REVIEW: Getting It To the Bottom Line: Management by
Incremental Gains
*********
360NETWORKS: Acquires Urbanlink Assets via Non-Cash Transaction
---------------------------------------------------------------
360networks, inc., announced it has acquired assets of Urbanlink
Holdings Ltd. held by Worldwide Fiber Holdings Limited, a wholly
owned subsidiary of the Ledcor Group, in a non-cash transaction
that results in 360networks owning all of Urbanlink. 360networks
surrendered a US$82.3 million note in exchange for the Urbanlink
stock and the potential to acquire up to 62 million shares in
360networks.
The transaction was approved recently by the Supreme Court of
British Columbia and supported by the Court Monitor and the
company's senior bank lenders.
360networks and Ledcor were joint owners of Urbanlink, a
Canadian affiliate, which owns and operates fiber optic network
assets in Canada. 360networks negotiated to secure and integrate
Urbanlink with the company's other North American network assets
as it is an integral component of the company's operations and
reorganization efforts.
360networks does not intend for Urbanlink to be part of the
restructuring proceedings under Canada's Companies' Creditors
Arrangement Act.
360networks offers optical network services to
telecommunications and data communications companies in North
America. The company's optical mesh fiber network spans
approximately 36,000 kilometers (22,000 miles) in the United
States and Canada.
On June 28, 2001, the company and several of its operating
subsidiaries voluntarily filed for protection under the
Companies' Creditors Arrangement Act (CCAA) in the Supreme Court
of British Columbia. Concurrently, the company's principal U.S.
subsidiary, 360networks (USA) inc., and 22 of its affiliates
voluntarily filed for protection under Chapter 11 of the U.S.
Bankruptcy Code in the U.S. Bankruptcy Court for the Southern
District of New York. In October 2001, four operating
subsidiaries that are part of the 360atlantic group of companies
also voluntarily filed for protection in Canada. Insolvency
proceedings for several subsidiaries of the company have been
instituted in Europe and Asia. For more information about
360networks, visit http://www.360.net
ABRAXAS PETROLEUM: Venture Securities Discloses 7% Equity Stake
----------------------------------------------------------------
Venture Securities Corporation beneficially owns 2,091,422
shares of the common stock of Abraxas Petroleum Corporation,
representing 7.0% of the outstanding common stock of that
Company. The investment adviser firm, Venture Securities, holds
sole power to vote, or direct the voting, of 1,188,154 shares,
and the sole power to dispose of, or direct the disposition of,
the 2,091,42 shares.
Abraxas Petroleum Corporation is a San Antonio-based crude oil
and natural gas exploitation and production company that also
processes natural gas. The Company operates in Texas, Wyoming
and western Canada. The company owns 87% of Canadian firm Grey
Wolf Exploration and plans to buy the rest. At June 30, 2001,
the company had a total shareholders' equity deficit of about
$17 million.
ACTIVE FIRE: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: Active Fire Sprinkler Corp.
17 Battery Place
New York, NY 10004
Bankruptcy Case No.: 02-10507-reg
Chapter 11 Petition Date:
Court: Southern District of New York (Manhattan)
Judge: Robert E. Gerber
Debtor's Counsel: Randy J. Schaefer
LaMonica Herbst & Maniscalco, LLP
3305 Jerusalem Avenue
Wantagh, NY 11793
Tel: (516) 826-6500
Fax : (516) 826-0222
Estimated Assets: $0 to $50,000
Estimated Debts: $1 million to $10 million
Debtor's 20 Largest Unsecured Creditors:
Entity Nature Of Claim Claim Amount
------ --------------- ------------
American Home Assurance _____________ $1,040,000
Company
Daniel Markewich, Esq.
C/O Mound Cotton
Wollan & Greengrass
One Battery Park Plaza
New York, NY 10004-1486
McManus, Schor, Asmar & _____________ $120,000
Darden
Michael Miller, Esq. _____________ $75,000
Nys Unemployment Insurance _____________ $40,000
Grinnell Corp Trade debt $31,129
Lucent Technologies Trade debt $26,000
BMW Financial Services _____________ $23,096
Davis & Warshow _____________ $17,330
Marden, Harrison & Kreuter _____________ $15,661
Central Sprinkler _____________ $13,455
Chase Auto Finance _____________ $10,241
Chase Auto Finance _____________ $9,836
BDO Siedeman _____________ $9,540
Cross Fire & Security Co. _____________ $8,135
Local 348-108 _____________ $8,000
Ricoh Trade debt $6,000
Ford Motor Credit Corp. _____________ $4,950
Bender Insurance _____________ $2,993
Verizon Trade debt $1,000
Canawill, Inc. _____________ $864
ADVANCED MICRO: Fitch Junks Convertible Subordinated Rating
-----------------------------------------------------------
Fitch Ratings assigns a 'B-' rating to Advanced Micro Devices,
Inc.'s $500 million 4-3/4% Rule 144A convertible senior
debentures due 2022. Proceeds will be used for capital
expenditures, working capital, and general corporate purposes. A
portion will be invested in the recently announced joint venture
with United Microelectronics Corp. of Taiwan. The company's 'B'
senior secured, 'B-' senior unsecured, and 'CCC' convertible
subordinated ratings are affirmed. The Rating Outlook is changed
to Stable from Positive.
While the ratings reflect AMD's significant position in the PC
microprocessor and flash memory markets, its solid execution in
recent years, and relatively strong balance sheet, Fitch also
recognizes the difficult competitive environment AMD faces
especially regarding Intel's pricing strategy which continues to
pressure AMD's margins. The overall challenging current
semiconductor industry environment and volatility of AMD's
markets, as well as the highly capital intensive nature of its
business which requires that production process technologies be
updated on a continuous basis to remain competitive with ever
smaller feature sizes are also rating factors.
Yesterday AMD announced a joint venture with UMC to share the
more than $3 billion needed for its next major capital program
through a Singapore facility that by 2005 will fabricate
semiconductors on 300 mm rather than 200 mm wafers. The
agreement will reduce AMD's future capital spending
requirements, allow it to share technology with UMC, and provide
it with the lower unit die costs of the larger wafer size.
AMD's revenue decline of 16% in 2001 was less severe than that
of the overall semiconductor industry, which declined by
approximately 30%, one of the worst year's in the industry's
history. AMD's microprocessor revenues grew 4% on 16% unit
growth, with average selling price lower due to continuing
competitive pricing pressure. The company believes its
microprocessor market share against Intel improved to 20% from
16% in 2000. Microprocessor revenue growth was offset by a 28%
decline in AMD's flash memory segment, driven mostly by lower
market demand for cellular handsets. EBITDA declined to $654
million in 2001 from $1.47 billion in 2000 with capital spending
also declining to $703 million from $805 million.
Despite the difficult operating environment AMD did manage to
improve its balance sheet with the conversion of $518 million of
convertible subordinated notes and the redemption of the
remaining $43 million of 11% senior secured notes. Total debt
declined to $1.0 billion from $1.3 billion. Debt consists mainly
of loans from a consortium of mostly German banks, guaranteed by
the Federal Republic of Germany and the State of Saxony to
support AMD's primary current semiconductor fabrication facility
in Dresden, Germany. Leverage, as measured by total debt to
EBITDA, rose to 1.5 times in 2001 versus 0.9 times in 2000 due
to the faster decline in EBITDA than in debt. EBITDA/interest
coverage declined to 10.6 times from 24.4 times over the same
period. Pro forma had the $500 million private placement
occurred in 2001, leverage would have been 2.3 times and
interest coverage 7.7 times.
While Fitch believes the company's $870 million in cash at the
end of 2001, down from $1.29 billion in 2000, is adequate in the
near term, with the steep ongoing capital spending required to
maintain competitiveness in the semiconductor industry and
volatile free cash flows, the placement of the $500 million of
convertible senior debentures clearly increases the company's
liquidity and financial flexibility.
ALPNET: Issues 24.8MM Shares to SDL Pursuant to Planned Merger
--------------------------------------------------------------
On January 16, 2002, SDL plc, a company organized under the laws
of England and Wales, through Arctic Inc., a Utah corporation
and a wholly owned subsidiary SDL plc, accepted for purchase
24,877,788 common shares, no par value, of ALPNET, Inc., a Utah
corporation, that had been validly tendered and not withdrawn
pursuant to SDL's tender offer for all of the outstanding
shares at $0.21 per share, net to the seller in cash.
The Offer was made pursuant to an Agreement and Plan of Merger,
dated December 12, 2001 between the Company, Parent and
Purchaser, which provides for, among other things, the making of
the Offer by Purchaser and, following the consummation of the
Offer, the merger of Purchaser with and into the Company, with
the Company as the surviving corporation in the Merger. The
Shares purchased pursuant to the Offer constitute approximately
77% of the Shares issued and outstanding. The aggregate
purchase price for the Shares purchased pursuant to the Offer
was $5,224,335.48.
In addition, on December 12, 2001, Purchaser and the Company
entered into a Share Option Agreement pursuant to which
Purchaser is entitled to purchase Shares of the Company at a
price of $0.21 per Share, so that, following the purchase of
the Option Shares, Purchaser shall then own 90.1% of the
outstanding Shares of the Company; provided that to purchase
Shares under the Option, Purchaser must own at least 75% of the
outstanding Shares of the Company prior to exercising the
Option. On January 16, 2002, Purchaser exercised the Option to
purchase 44,461,957 of the authorized but unissued Shares of the
Company through a promissory note in the amount of $9,337,010.97
as payment in full.
Following the expiration of the Offer and the consummation of
the transactions described here, Parent now owns approximately
90.1% of the Shares issued and outstanding. Purchaser obtained
all funds needed for such purchase through a capital
contribution from Parent.
On February 1, 2002, the date on which the Articles of Merger
was duly filed with the Division of Corporations and Commercial
Code of the State of Utah, the Merger provided for by the Merger
Agreement will become effective. Pursuant to the Merger, Shares
which were not validly tendered pursuant to the Offer and
accepted for purchase by Purchaser (and whose holders have not
sought dissenters' rights for their Shares in accordance with
applicable provisions of Utah law) will be converted into the
right to receive $0.21 per Share, net to the seller in cash,
upon delivery of appropriate documentation to the Disbursing
Agent for the Offer, American Stock Transfer and Trust Company.
As a result of the Merger, Parent will own 100% of the
outstanding Shares of the Company.
The Company held a meeting of its Board of Directors on January
16, 2002 after completion of the Offer and acceptance of the
Shares by Purchaser. At the Board Meeting, the Company accepted
the resignations of Messer's. Donald M. Reeves, Darnell L.
Boehm, Eckart Wintzen and Koos Ros, as Directors of the Company.
The Company received written resignations from these Directors,
effective January 16, 2002. The Board then unanimously appointed
Mr. Mark Lancaster to serve as a Director and Chairman of the
Board and Mr. Alastair Gordon to serve as a Director and
Secretary of the Board. The Board then accepted the
resignations of Mr. Michael F. Eichner as Director and acting
CEO, Mr. Jaap van der Meer as Director and President, Mr. John
W. Wittwer as Vice President Finance and CFO, and Mr. James R.
Morgan, as Director, Secretary and Vice President Legal, CLO of
the Company. The Company received written resignations from
these Directors and Officers effective January 16, 2002. The
Board then unanimously appointed Mr. Mark Lancaster President
and Mr. Alastair Gordon Secretary of the Company.
To the knowledge of the Company, except as set forth here, there
are no arrangements, including any pledge by any person of
securities of the Company, the operation of which may at a
subsequent date result in a further change in control of the
Company.
ALPNET is one of the world's largest, publicly-owned, dedicated
providers of complete multilingual information management
solutions, with a worldwide network of offices and resources. A
pioneer in its industry, ALPNET helps corporations deploy into
international markets faster and more efficiently, through
intelligent use and reuse of multilingual informational assets.
ALPNET offers an extensive range of services, based on
innovative, proven technologies, including strategic InfoCycle
consulting, as well as Web, software and document localization
and publishing, in all business languages and formats. At
September 30, 2001, the company reported a working capital
deficiency of about $4.2 million.
AMTRAK: Cato Institute Report Calls for Chapter 11 Proceeding
--------------------------------------------------------------
The Amtrak Reform Council (ARC) was expected to submit yesterday
to Congress its reorganization plan for the federal government's
beleaguered passenger rail system. But according to a new
Cato Institute study, that plan "ignores fundamental problems
and represents a too-little, too-late departure from Amtrak's
present structure."
In "A Plan to Liquidate Amtrak," former ARC member Joseph
Vranich, bankruptcy lawyer Cornelius Chapman, and Edward L.
Hudgins, director of regulatory studies at the Cato Institute,
put forth their own plan. They recommend that Amtrak be
subjected to a "Chapter 11" bankruptcy proceeding that would put
its worthwhile assets in private hands while recouping some of
the billions of dollars U.S. taxpayers have sunk into the money-
losing train monopoly.
"The virtue of a Chapter 11 proceeding is that it is insulated
from political pressures, since a bankruptcy judge has both
express statutory authority and broad equitable powers to deal
with Amtrak simply in terms of its debts and its creditors," the
authors write.
"Although Amtrak under law was supposed to draw up its own
liquidation plan, a handful of senators recently blocked it from
doing so," Hudgins said. "Bankruptcy would force Amtrak to open
its now-veiled books to the public and policy makers."
This is in contrast to the ARC's proposal to simply reorganize
Amtrak's holdings, a plan that the authors say appears to be
anti-competitive and sets up the rail line to fail again and
again. According to the study, rail bankruptcies are nothing
new: In the 1890's when trains were the primary mode of
intercity passenger transportation, thousands of miles of rail
were taken over by the courts or sold at foreclosure without a
national crisis ensuing.
BEAZER HOMES: S&P Affirms Low-B Post-Merger Agreement Ratings
-------------------------------------------------------------
Standard & Poor's affirmed its double-'B'-minus corporate credit
rating on Beazer Homes USA following its announced definitive
merger agreement with unrated Crossman Communities Inc. The
outlook remains positive. The ratings and outlook acknowledge
the good strategic fit of the two companies as well as the
largely credit neutral structure of the merger transaction.
Atlanta-based Beazer Homes announced that it has entered into a
definitive merger agreement with Indianapolis-based Crossman
Communities. The stock and cash transaction has a total value of
approximately $603 million and represents 6.0 times Crossman's
calendar 2001 EBITDA or approximately 9.0x earnings. The
transaction is conditioned upon, among other things, the
approvals of both Beazer's and Crossman's shareholders and
appropriate regulatory approvals. The companies anticipate that
the transaction will be completed in approximately 90 to 120
days.
Beazer Homes builds single-family homes for first-time, and
first-time, move-up buyers in the Southeast, Southwest, and mid-
Atlantic regions of the U.S. Crossman Communities Inc. is also
focused on the entry-level buyer and has operated in various
Midwest markets since 1973. Crossman is the leading builder in
Indianapolis and among the top five builders in Columbus and
Cincinnati. It also has operations in Kentucky, Tennessee, and
in Beazer's existing markets of North Carolina and South
Carolina. The merger of the two companies results in a market
capitalization of approximately $1 billion and pro forma 2001
revenues of $2.7 billion from 15,506 deliveries, making it the
sixth largest homebuilder in the U.S. Crossman also adds
significant scope to Beazer's operations as it expands to 40
markets in 16 states, from 35 markets in 14 states, and provides
a sizable land supply (roughly six years) through a combination
of lots owned (58%) and optioned.
Integration should be relatively smooth given the good strategic
fit of the two companies, the expected retention of key Crossman
personnel, and Beazer's good track record of successfully
integrating previous, albeit much smaller, acquisitions.
The transaction has been structured with approximately 50%-60%
common stock to maintain Beazer's balance sheet and credit
statistics. The company has also obtained a $250 million bridge
facility (one year term) to facilitate the merger. Debt-to-total
capitalization on a pro forma basis is expected to be maintained
at about 54% and debt-to-tangible capitalization is expected
to be about 63%, which is net of a sizable but still acceptable
level (approximately $200 million) of goodwill for the
transaction. Coverage measures are also expected to remain
strong with pro forma EBITDA interest coverage of more than 4.0x
and debt/EBITDA of 2.6x, both of which are solid for the rating
and consistent with Beazer's historical levels.
Outlook Positive
Beazer continues to post strong operating results and management
has demonstrated its commitment to preserving its good financial
position. In addition to an enhanced market position and
improved geographic diversification, the addition of highly
profitable Crossman provides Beazer with potential for further
efficiency gains and profit opportunities. Future upgrade
consideration will be driven by continued improvement to
profitability measures, prudent inventory management,
particularly as the housing market softens, and maintenance of a
sound capital structure.
BRIDGE INFO: Reaches Pact to Hire Lardner & Helfrey as Counsel
--------------------------------------------------------------
In a Court-approved stipulation, Bridge Information Systems,
Inc., and its debtor-affiliates, the Official Committee of
Unsecured Creditors and the post-petition Lenders have agreed
that:
(i) Bryan Cave, co-counsel to the Debtors, does have a
conflict of interest with Savvis Communications
Corporation;
(ii) Foley & Lardner and Helfrey, Simon & Jones represent the
Debtors as special counsel with respect to its third-party
action against Savvis;
(iii) neither the DIP Lenders nor the United States Trustee has
objected to the retention of Foley & Lardner and Helfrey &
Jones as special counsel to the Debtors in connection with
the third-party action; and,
(iv) the Committee has approved the retention of Foley &
Lardner and Helfrey, Simon & Jones as special counsel to
the Debtors.
Thus, the Court rules that Foley & Lardner and Helfrey, Simon &
Jones are appointed as special counsel to the Debtors with
respect to the Debtors' third-party action against Savvis
Communications Corporation. (Bridge Bankruptcy News, Issue No.
25; Bankruptcy Creditors' Service, Inc., 609/392-0900)
BURLINGTON INDUSTRIES: Committee Taps BDO Seidman as Advisors
-------------------------------------------------------------
The Official Committee of Unsecured Creditors of Burlington
Industries, Inc., and its debtor-affiliates, seeks the Court's
authority to retain BDO Seidman as its financial advisor, nunc
pro tunc to November 30, 2001.
Donald J. Detweiler, Esq., at Saul Ewing, in Wilmington,
Delaware, relates that the Committee decided to employ BDO
Seidman because of the Firm's considerable experience in
representing creditors' committees in chapter 11 cases
throughout the country. The Committee believes that BDO Seidman
is well qualified to represent its interests.
The Committee expects BDO Seidman to assist it in:
(i) analyzing the current financial position of the Debtors;
(ii) analyzing the Debtors' business plans, cash flow
projections, restructuring programs and other reports or
analyses prepared by the Debtors or its professionals in
order to advise the Committee on the viability of the
continuing operations and the reasonableness of
projections and underlying assumptions;
(iii) analyzing the financial ramifications of proposed
transactions for which the Debtors seek Bankruptcy Court
approval including, but not limited to, DIP financing,
assumption/rejection of leases, management compensation
and/or retention plans;
(iv) analyzing the Debtors' internally prepared financial
statements and related documentation, including store
level operating results, in order to evaluate the
performance of the Debtors as compared to its projected
results;
(v) attend and advise at meetings with the Committee, its
counsel and representatives of the Debtors;
(vi) assist and advise the Committee and its counsel in the
development, evaluation and documentation of any plans
of reorganization or strategic transactions, including
developing, structuring and negotiating the terms and
conditions of potential plans or strategic transactions
and the value of consideration that is to be provided to
unsecured creditors;
(vii) render expert testimony on behalf of the Committee; and,
(viii) provide such other services, as requested by the
Committee and agreed to be BDO Seidman.
Mr. Detweiler states that BDO Seidman will bill for services at
its customary hourly rates:
Professionals Rates
------------- -----
Partners $330 - $600
Senior Managers 215 - 480
Managers 195 - 330
Seniors 140 - 245
Staff 90 - 185
According to Jerry D'Amato, a Certified Public Accountant and a
member of BDO Seidman, the Firm and its members have no
connection with the Debtors or any other party in interest --
other than the initial communication between BDO Seidman and the
Committee with respect of the retention of their firm in this
case. Mr. D'Amato asserts that BDO Seidman does not hold any
interest materially adverse to the Debtors' estates and is a
"disinterested person" as defined by section 101(14) of the
Bankruptcy Code.
Mr. D'Amato explains that from time to time, BDO Seidman has
been retained and will likely continue to be retained by certain
creditors of the Debtors, but guarantees to use commercially
reasonable efforts to limit any such engagements to matters
unrelated to this case. (Burlington Bankruptcy News, Issue No.
7; Bankruptcy Creditors' Service, Inc., 609/392-0900)
CALICO COMMERCE: Closes Sale of Assets to PeopleSoft for $5MM
-------------------------------------------------------------
Calico Commerce, Inc., announced that it has closed the sale of
its intellectual property and certain assets to PeopleSoft,
Inc., for approximately $5 million cash. As a result of the
sale, Calico will cease selling its products, and PeopleSoft
will be providing support of Calico's configuration applications
and will collect accounts receivable due to Calico.
"The market for stand-alone interactive selling vendors is
vanishing because customers are demanding broad, integrated
enterprise software solutions, as opposed to point products,"
said James B. Weil, president and CEO of Calico. "We are pleased
that the Calico's best-of-breed products will become part of
PeopleSoft's enterprise solution offering."
In addition, PeopleSoft has hired approximately 40 of Calico's
employees, leaving Calico with approximately 5 employees to
perform the remaining tasks necessary to conclude its bankruptcy
proceedings and other administrative matters.
Information about Calico Commerce, Inc., and its bankruptcy
proceedings will continue to be located online at
http://www.calicocommerce.com as well as in the company's
filings with the Securities and Exchange Commission available
online at http://www.sec.gov
CLASSIC COMMS: Court Fixes Mar. 29 Bar Date for Proofs of Claim
---------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware fixed a
Claims Bar Date and Governmental Unit Bar Date by which
creditors must file proofs of claim against Classic
Communications, Inc., in its chapter 11 cases.
The Court directs that all person and entities holding or
wishing to assert a claim against any of the Debtors or their
property have until March 29, 2002 to file a separate, completed
and executed proof of claim form. The Governmental Units Bar
Date is May 13, 2002.
The Claims Bar Date does not apply to the filing of proofs of
interests in the Debtors. However, if any security holder that
has a claim arising out of the purchase or sale of an equity
interest, they must file a claim on or before the Claims Bar
Date.
Proofs of claim will be deemed timely filed only if actually
received by BSI on or before the applicable Bar Date.
Original proofs of claim sent via first class mail should be
addressed to:
Classic Communications, Inc.
c/o Bankruptcy Services LL
PO Box 5112
FDR Station
New York, NY 10150-5112
and a duplicate should be sent to:
Classic Communications, Inc.
c/o Bankruptcy Services LLC
70 East 55th Street, Heron Tower, 6th Floor
New York, NY 10022
Facsimile or e-mail proofs of claims are not acceptable and are
not valid for any purpose.
The Debtors remind creditors that if they fail to file a proof
of claim on or before the applicable Bar Date that they shall be
forever barred from asserting their claims. The Debtors shall
be discharged from any indebtedness or liability and such holder
shall not be permitted to vote on any plan or participate in any
distribution on the Debtors' chapter 11 cases on account of such
claim.
The Debtors agree that Goldman Sachs Credit Partners LP may file
one proof of claim against each Debtor, as applicable, on behalf
of all the Prepetition Lenders. Each Prepetition Lenders
however, retains the exclusive right to vote individually on any
plan of reorganization.
Classic Communications, Inc., a cable operator focused on non-
metropolitan markets in the United States, filed for Chapter 11
petition on November 13, 2001 along with its subsidiaries.
Brendan Linehan Shannon, Esq. at Young, Conaway, Stargatt &
Taylor represents the Debtors in their restructuring efforts.
When the Company filed for protection from its creditors, it
listed $711,346,000 in total assets and $641,869,000 in total
debts.
COHO ENERGY: Chapter 11 Case Summary
------------------------------------
Lead Debtor: Coho Energy, Inc.
14785 Preston Rd., #860
Dallas, TX 75254
Bankruptcy Case No.: 02-31189
Debtor affiliates filing separate chapter 11 petitions:
Entity Case No.
------ --------
Coho Resources, Inc. 02-31190
Coho Oil & Gas, Inc. 02-31191
Chapter 11 Petition Date: February 6, 2002
Court: Northern District of Texas (Dallas)
Judge: Barbara J. Houser
Debtor's Counsel: Michael W. Anglin, Esq.
Fulbright & Jaworski
2200 Ross Ave., Suite 2800
Dallas, TX 75201
214-855-8000
COMDISCO INC: Selling Sub Debt Agreements to MetDent for $1MM+
--------------------------------------------------------------
Comdisco, Inc., and its debtor-affiliates intend to sell its Sub
Debt Agreements with Dental X Change Inc. to MetDent Inc.
George N. Panagakis, Esq., at Skadden, Arps, Slate, Meagher &
Flom, in Chicago, Illinois, states that included in the sale are
related promissory notes for the purchase price of $1,000,000
together with other non-cash consideration.
Mr. Panagakis relates that the agreed purchase price for the
Debt is $1,000,000 together with a certain convertible note and
contingent obligation issued by Dental Connect Inc. "Under the
proposed transaction, the purchaser will also obtain an option
to purchase certain equipment with the Debtor currently leased
to Dental X Change," Mr. Panagakis adds.
Furthermore, Mr. Panagakis reports that the Debt is secured by
liens, which are subordinate to those of Silicon Valley Bank.
The proposed sale will occur in conjunction with a subsequent
foreclosure by Silicon Valley Bank of its interests in Dental X
Change. Based on the substantial price that the Buyer has
agreed to pay for the Debt, the Debtors believe the offer is
fair, appropriate and favorable. (Comdisco Bankruptcy News,
Issue No. 20; Bankruptcy Creditors' Service, Inc., 609/392-0900)
COMMEMORATIVE BRANDS: S&P Keeps Watch on Low-B & Junk Ratings
-------------------------------------------------------------
Standard & Poor's placed its ratings on Commemorative Brands
Inc., on CreditWatch with positive implications. The CreditWatch
listing reflects the intention of holding company American
Achievement Corp. to refinance a significant portion of
Commemorative Brands' existing indebtedness.
The positive implications of the CreditWatch incorporates
Standard & Poor's expectation that it will raise Commemorative
Brands' subordinated debt rating to single-'B'-minus upon the
closing of the refinancing transaction. If the refinancing is
completed as described, the note offering will relieve
Commemorative Brands from onerous debt service requirements and
bank financial covenants during the next few years.
In addition, Standard & Poor's assigned its single-'B'-plus
rating to American Achievement's proposed $175 million senior
unsecured notes due 2007, issued under Rule 144A, and its
single-'B'-plus corporate credit rating to the company. The debt
will rank pari passu, including domestic subsidiary guarantees.
At the same time, Standard & Poor's assigned its double-'B'-
minus rating to American Achievement's proposed $40 million
senior secured revolving credit facility due 2006.
The rating on the bank facility is one notch higher than the
corporate credit rating. The facility is guaranteed on a senior
secured basis by all of American Achievement's domestic direct
and indirect subsidiaries and is secured by substantially all of
the assets of the company and its guarantors. The credit
facility derives strength from its secured position. Based on
Standard & Poor's simulated default scenario, which incorporates
severely distressed cash flows that would trigger a default on
payment, the distressed enterprise value is expected to fully
cover the entire loan balance when fully drawn, if a payment
default were to occur.
The ratings reflect American Achievement's high leverage and
narrow business focus, partially offset by the company's well-
recognized brand names, broad distribution network, and the non-
deferrable nature of demand in the mature domestic class ring
and yearbook market.
Austin, Texas-based American Achievement, through Commemorative
Brands, is a leading manufacturer of class rings, yearbooks,
graduation products and affinity jewelry. The company's
financial flexibility continues to be constrained by its heavy
debt burden, incurred largely in connection with the company's
1996 buyout of ArtCarved and LG Balfour Co., and the
acquisitions of Taylor Publishing Co. and Educational
Communications Inc. In addition, the $2.3 billion U.S.
scholastic products industry is competitive, with three
competitors dominating a significant portion of the class ring
and yearbook segments. Moreover, the business is highly
seasonal.
Still, American Achievement is a leading provider of class
rings, yearbooks and achievement publications in the U.S.
Approximately 40% of the company's total sales are generated
from the estimated $500 million North American high school and
college class ring market, sold under the ArtCarved and Balfour
brand names. Customized production, broad distribution network,
and the non-deferrable nature of demand create barriers to entry
and contribute to fairly stable cash flows and minimal inventory
risk. Consistent with the industry, the majority of the
company's class ring sales are in high school rings. The company
is the No. 2 player in the school ring market, behind market
leader Jostens Inc.
During the past few years, acquisitions have broadened American
Achievement's product offerings and enabled the company to
compete within about $1.3 billion of the scholastic products
market. Indeed, the July 2000 acquisition of Taylor Publishing
provided the company with a competitive position in the
estimated $500 million high school and college yearbook market.
The company has an estimated 20% share of this market, behind
market leader Jostens and on parity with Herff Jones Inc. While
the March 2001 acquisition of ECI provided the company with the
leading position in directories that recognize academic
achievement for the high school, college and teacher markets. In
addition, favorable demographics trends should contribute to
increased sales volume. Moreover, the integration of the ring
and yearbook operations provides American Achievement with
significant cross-selling opportunities since only about 25% of
high school customers currently purchase both rings and
yearbooks from the company.
Significantly, the company's operating performance has improved.
Cost savings from integrating the Taylor Publishing and ECI
businesses and operating efficiencies gained from new technology
have significantly reduced unit production costs for high school
rings and shortened production run cycles for yearbooks. Thus,
Standard & Poor's expects, pro forma the refinancing, EBITDA
coverage of cash interest to be about 2 times in 2002, with
funds from operations to lease adjusted debt to be about 10%.
Total debt adjusted for leases and preferred stock to EBITDA
will be about 5x, down from more than 6x in fiscal 2001. In
addition, the company's revolving credit facility provides some
financial flexibility, given that debt service requirements will
be minimal.
Ratings on CreditWatch with Positive Implications
Commemorative Brands Inc.
Corporate credit B
Subordinated debt CCC+
COSERV ELECTRIC: Chapter 11 Case Summary
----------------------------------------
Lead Debtor: Denton County Electric Cooperative, Inc.
dba CoServe Electric
dba CoServ Asset Management Corp.
dba CoServ Financial Services Corp.
dba CoServ Realty Services Corp.
dba CoServe Transportation Services Corp.
7701 S. Stemmons Frwy.
Lake Dallas, TX 75065-2363
Bankruptcy Case No.: 02-40665
Debtor affiliates filing separate chapter 11 petitions:
Entity Case No.
------ --------
Coserv Realty Holdings, L.P. 02-40666
CoServ Investments, L.P. 02-40667
Coserv Utility Holdings, LP 02-40668
Chapter 11 Petition Date: February 1, 2002
Court: Northern District of Texas (Fort Worth)
Judge: D. Michael Lynn
Debtors' Counsel: Richard McCoy Roberson, Esq.
Gardere,Wynne & Sewell
1601 Elm St., Suite 3000
Dallas, TX 75201
Tel: 214-999-3000
COUNCIL TRAVEL: Chapter 11 Case Summary
---------------------------------------
Lead Debtor: Council Travel Services, Inc.
205 East 42nd Street
New York, NY 10017
Bankruptcy Case No.: 02-10509-reg
Debtor affiliates filing separate chapter 11 petitions:
Entity Case No.
------ --------
Council Travel Services USA, Inc. 02-10510
Council Charter, Inc. 02-10511
Chapter 11 Petition Date: February 05, 2002
Court: Southern District of New York (Manhattan)
Judge: Robert E. Gerber
Debtors' Counsel: Schuyler Glenn Carroll, Esq.
Olshan Grundman Frome
Rosenzweig & Wolosky LLP
505 Park Avenue
New York, NY 10022
Tel: (212) 451-2313
Fax: (212) 935-1787
CRESCENT OPERATING: Machinery Unit Files Chapter 11 in Ft. Worth
----------------------------------------------------------------
Crescent Machinery Company, a wholly owned subsidiary of
Crescent Operating, Inc., (OTCBB:COPI.OB) has filed a voluntary
petition under Chapter 11 of the U.S. Bankruptcy Code with the
U.S. Bankruptcy Court in Fort Worth, Texas. CMC intends to
continue its normal operations in the sale, rental and servicing
of construction equipment, while reorganizing and restructuring
its debt to emerge a financially stronger and more competitive
business. CMC will continue with business as usual during this
process, but certain locations will be evaluated and may be sold
or closed to improve efficiency.
Crescent Machinery Company started with a single location in
Dallas, Texas. Today, CMC serves the construction industry from
fifteen branch locations in the states of Texas, Oklahoma,
California, Nevada and Hawaii. Among the major manufacturers
served by CMC's distribution system are JCB, Terex, Ingersoll-
Rand, Compaction America, Link-Belt, Gradall and LBX. In
addition to the sale of new and used equipment, the Company
operates a fleet of machines dedicated to the rental market. All
CMC locations provide parts as well as service and repair for
customers' machines.
Like many companies serving the construction industries,
Crescent Machinery Company has been affected by multiple factors
impacting the industry. These factors include excess inventories
of machines available for sale or rental, severe price
competition, a slowdown in many construction markets, the
reduction in the number of new projects, the general
recessionary economy, and the continued negative effects
following the terrorist attacks of September 11.
"We plan to move quickly and aggressively to reorganize Crescent
Machinery Company, taking advantage of the Chapter 11 process to
right size the organization and position the Company for the
future," says Crescent Machinery Company CEO Eric Anderson. "We
look forward to presenting our plans to the court, working with
our lenders and suppliers, and completing the reorganization
process with a strong business to serve our markets," Anderson
added.
In reviewing the markets the Company serves, CMC has made the
initial decision to focus Crescent Machinery Company in the
Texas and Oklahoma markets. The Company operates eight locations
in these states, and believes its experience with its customer
base and the suppliers represented in these markets gives it a
strong position. With its decision to downsize to an eight
location company, CMC will begin to sell or close its branch
operations in California, Nevada and Hawaii. "Our focus on Texas
and Oklahoma will give us the ability to closely and efficiently
manage a business requiring superb customer service and creative
solutions in an increasingly competitive market. While it is
difficult to exit our West Coast branches with their dedicated
employees, this is a necessary step to improve the profitability
and strength of CMC," Anderson said further.
CRESCENT MACHINERY: Chapter 11 Case Summary
-------------------------------------------
Lead Debtor: Crescent Machinery Company
777 Taylor St., #1050
Ft. Worth, TX 76102
Bankruptcy Case No.: 02-41005
Debtor affiliate filing separate chapter 11 petitions:
Entity Case No.
------ --------
E.L. Lester & Company, Inc. 02-41006
Chapter 11 Petition Date: February 6, 2002
Court: Northern District of Texas (Fort Worth)
Judge: D. Michael Lynn
Debtors' Counsel: James Robert Prince, Esq.
Thompson & Knight
3300 First City Center
1700 Pacific Ave.
Dallas, TX 75201-4693
Tel: 214-969-1700
EGAMES INC: Posts $5.7MM Operating Loss in FY 2001 Ended June 30
----------------------------------------------------------------
eGames, Inc., reported that net sales for the year ended June
30, 2001 were approximately $7,172,000 compared to approximately
$10,794,000 for the year ended June 30, 2000, representing a
decrease of approximately $3,622,000, or 34%. The $3,622,000
decrease in net sales was primarily attributable to a $4,880,000
decrease in net sales to retailers that traditionally sell PC
software, or to distributors servicing such retailers, and a
$98,000 decrease in international net sales. These decreases
were partially offset by a $1,131,000 increase in net sales to
food and drug retailers and a $225,000 increase in promotional
customer sales. The $4,880,000 decrease in net sales to
traditional software retailers and distributors in fiscal 2001
was comprised of a $4,405,000 decrease in net sales made through
third-party distribution customers and a $475,000 decrease in
net sales made on a direct shipment basis to mass-merchant
retail customers.
The Company's $4,880,000 decrease in fiscal 2001 net sales to
traditional software retailers and distributors was attributed,
in part, to the increasing competition for retail shelf-space
from the Company's larger competitors that have continued to
transition historically top selling and previously higher-
priced software titles to the value-priced software category,
where the Company primarily competes at retail. The Company's
larger competitors have used their greater financial resources
to support the higher promotional spend rates that are often
required by retailers and have therefore continued to gain
additional retail shelf space. Additionally, office superstore
retailers and distributors reduced their offering of certain
value-priced software for the casual games fiscal 2001, which
negatively impacted the Company's net sales by approximately
$2,919,000 during this period. During fiscal 2001, it became
increasingly more difficult for the Company to absorb the
increased promotional spending requirements of these retailers,
which caused the Company to reduce its sales to the office
superstore retailers. Also during fiscal 2001, the Company's
mass-merchant retail customers continued to reduce in-channel
inventory of purchased product, which negatively impacted the
Company's net sales. The Company's net sales in fiscal 2001
were also affected by the deterioration of the financial
condition of certain mass-market retail customers.
During fiscal 2001, the Company's $1,131,000 increase in net
sales to food and drug retailers compared to fiscal 2000
resulted primarily from increases in both short-term promotions
merchandised in corrugated displays and longer-term featured
programs merchandised in more durable display fixtures such as
rotating display racks and in-line shelving display fixtures.
Approximately $1,089,000 of this increase was attributable to
the Company's net sales of third-party software titles within
its Store-in-a-Store program, which the Company had believed
would increase the overall success of the Company's sales
efforts to food and drug retailers due to the historical
success of these titles in traditional software retail stores.
Although the Company recognized increased net sales as a result
of this SIAS distribution strategy, the costs of display racks,
the higher costs associated with third-party software titles and
the additional shipping and return processing costs strained
the Company's working capital resources during fiscal 2001 and
the SIAS program caused the Company to recognize lower
profitability. As a result, the Company has already begun
reducing and will continue to reduce its sales efforts under
this program in fiscal 2002. During fiscal 2001, the Company's
net sales to food and drug retailers represented approximately
39% of the Company's net sales overall, compared to 15% of the
Company's fiscal 2000 overall net sales.
During the year ended June 30, 2001, the Company had three major
customers (Walgreen Company, Infogrames, Inc. and Rite Aid
Corporation), which accounted for approximately 20%, 17% and 10%
of net sales, respectively, compared to the year ended June 30,
2000, in which the Company had two major customers (Infogrames,
Inc. and Navarre Corporation), which accounted for approximately
22% and 13% of net sales, respectively.
The Company's international net revenues, inclusive of both
product net sales and royalty revenues, represented 6% of the
Company's net sales for fiscal 2001 compared to 5% of the
Company's net sales for fiscal 2000. The Company anticipates
that its international net revenues may represent approximately
5% to 10% of its net sales during fiscal 2002. The Company's
international net revenues for the years ended June 30, 2001
and 2000 were 411,000 and $509,000, respectively. During the
fourth quarter of fiscal 2001, he Company sold its wholly-owned
distribution operation located in the United ingdom. By
effecting this sale, the Company transitioned the majority of
its international distribution efforts to a licensing revenue
model, whereby the Company no longer bears the working capital
risk of supporting these multi-country sales efforts, but will
earn a royalty fee based upon product sales covered in various
licensing arrangements.
During fiscal 2001, the Company recorded $225,000 in promotional
customer revenues as a result of developing and manufacturing a
customized software game title for a nationally known fast-food
restaurant. This product enabled the consumer to both play
games included on the computer disk, as well as to use an
embedded Internet link on the computer disk to play additional
games on a special section of the retailer's Internet website.
During fiscal 2002, the Company will continue to explore other
such potential promotional programs, but will only allocate
resources to such programs that would add incremental
profitability to the Company's operating results.
During fiscal 2001, the Company initiated several programs to
increase the net sales of its products over the Internet,
including: the roll-out of an improved and expanded Web site;
improvement of its electronic distribution capabilities by
further developing and expanding its affiliation with Digital
River, a leading distributor of digital software over the
Internet; and incorporation of user-friendly on-line
functionality into its products. Revenues of the Company's
products via the Internet for the years ended June 30, 2001 and
2000 were approximately $171,000 and $177,000, respectively, or
approximately 2% of the Company's net sales during both years.
During fiscal 2002, the Company plans to continue evaluating
potential new initiatives to help increase the operating profits
from its sales efforts over the Internet.
Cost of sales for the year ended June 30, 2001 were $6,007,000
compared to $4,279,000 for the year ended June 30, 2000,
representing an increase of $1,728,000, or 40%. This increase
was caused primarily by increases in: provision for inventory
obsolescence of $1,273,000, processing costs for product returns
of $324,000, freight costs of $206,000, and other cost of sales
of $244,000, which increases were partially offset by decreases
in product costs of $297,000 and royalty costs of $22,000.
The Company's gross profit margin for fiscal 2001 decreased to
16.2% of net sales from 60.4% of net sales for fiscal 2000.
This 44.2% decrease in gross profit margin was caused primarily
by increases, as a percentage of net sales, in the following:
- provision for inventory obsolescence of 18.3%;
- product cost of 8.6%;
- processing costs for product returns of 5.2%;
- freight costs of 4.8%;
- royalty costs of 3.4%; and
- other cost of sales of 3.9%.
As a result of the various factors discussed above, the Company
recognized a $5,738,000 loss from continuing operations for the
year ended June 30, 2001, compared to income from continuing
operations of $57,000 for the year ended June 30, 2000, a
decrease of $5,795,000.
eGames, Inc., formerly RomTech, Inc., a Pennsylvania corporation
incorporated in July 1992, publishes, markets and sells a
diversified line of personal computer software primarily for
consumer entertainment. The Company also offers a small number
of personal productivity products for sale. In August 1998, the
Company acquired Software Partners Publishing and Distribution
Ltd., a United Kingdom-based distributor of personal computer
software for consumer entertainment and small office/home office
applications. On March 31, 1999 Software Partners changed its
name to eGames Europe Ltd. On May 11, 2001 the Company sold
eGames Europe to Greenstreet Software Limited, a United
Kingdom-based software publisher and distributor. As reported in
the Nov. 07, 2001, edition of Troubled Company Reporter, the
company received a waiver of defaults of its financial covenants
under the $2 million credit facility.
E.SPIRE COMMS: Seeks Approval to Extend Removal Period to Apr. 1
----------------------------------------------------------------
e.spire Communications, Inc., and its debtor-affiliates ask the
U.S. Bankruptcy Court for the District of Delaware to extend the
time period within which they must decide if they want to remove
lawsuits pending in courts outside of Delaware to Delaware for
continued litigation. This is the Debtors' third request of an
extension. The Debtors ask the Court to extend the deadline
through April 1, 2002.
In order to determine the removal of any particular action, the
Debtors must evaluate various issues. At this time, the Debtors
say, they have not had a sufficient opportunity to do so. The
Debtors' management and counsel have been preoccupied with
numerous bankruptcy-related matters and administering these
Chapter 11 cases. The management has also been focused on the
sale of certain assets and negotiating a plan of reorganization.
A hearing on this request is scheduled for February 20, 2002.
e.spire Communications, Inc. is a facilities-based integrated
communications provider, offering traditional local and long
distance dedicated internet access in 28 markets throughout the
United States. The Company filed for chapter 11 protection on
March 22, 2001. Domenic E. Pacitti, Esq., Maria Aprile Sawczuk,
Esq. and Mark Minuti at Saul Ewing LLP represents the Debtors in
their restructuring effort.
ENRON CORP: Seeks Approval to Hire Ordinary Course Professionals
----------------------------------------------------------------
Enron Corporation, and its debtor-affiliates seek the Court's
authority to employ professionals utilized in the ordinary
course of business as of the Petition Date.
According to Melanie Gray, Esq., at Weil, Gotshal & Manges LLP,
in New York, the services provided by these Ordinary Course
Professionals include, among others, legal services with regard
to certain specialized matters or areas of the law other than
reorganization and bankruptcy law. In addition, Ms. Gray says,
the Debtors may employ other professionals in the ordinary
course of business, such as appraisers, brokers, consultants,
engineers, and auctioneers.
"The Debtors reserve the right to retain additional Ordinary
Course Professionals from time to time during these cases, as
the need arises," according to Ms. Gray. Furthermore, Ms. Gray
states, the Debtors propose to file a list of such additional
professionals with the Court and to serve copies of such list on
the United States Trustee, the attorneys for the post-petition
lenders, and the attorneys for the statutory committee of
unsecured creditors. If no objections to any such supplemental
list are filed within 15 days after its service, the Debtors ask
the Court to consider the supplemental list as approved without
the need for a hearing.
In light of the additional cost associated with the preparation
of employment applications for professionals and the substantial
number of Ordinary Course Professionals, Ms. Gray contends, it
is impractical and cost inefficient for the Debtors to submit
individual applications, affidavits and proposed retention
orders for each professional. Accordingly, Ms. Gray suggests
that the Court should dispense with the requirement of
individual employment applications, affidavits and retention
orders with respect to each Ordinary Course Professional, and
that each professional be retained from time to time as of the
Petition Date.
Moreover, Ms. Gray continues, each professional retained as an
Ordinary Course Professional shall file an affidavit with the
Court pursuant to section 327 of the Bankruptcy Code, within 30
days following the later of:
(i) entry of the order granting this Motion, and
(ii) the engagement of such professional by the Debtors in
these chapter 11 cases, setting forth that such
professional does not represent or hold any interest
adverse to the Debtors or their respective estates.
Ms. Gray asserts that the Debtors should be permitted to pay
each Ordinary Course Professional, without a prior application
to the Court by such professional, 100% of the fees and
disbursements incurred, upon the submission to, and approval by,
the Debtors of an appropriate invoice setting forth in
reasonable detail the nature of the services rendered and
disbursements actually incurred. However, Ms. Gray makes it
clear that such interim fees and disbursements should not exceed
$50,000 per month per Ordinary Course Professional on average
over any six-month period. "All payments of compensation
exceeding $50,000 per month per Ordinary Course Professional on
average over a rolling six-month period shall be subject to the
prior approval of the Court," Ms. Gray explains. At this time,
the Debtors expect that the total fees to any Ordinary Course
Professionals would not average more than $50,000 per month.
Ms. Gray tells the Court that the approval of the relief
requested will save the estates the expense of separately
applying for the employment of each professional. Furthermore,
Ms. Gray adds, relieving the Ordinary Course Professionals of
the requirement of preparing and prosecuting fee applications
will save the estates the additional professional fees and
expenses that would be generated by it. Likewise, Ms. Gray says,
the proposed procedure employing the Ordinary Course
Professionals will spare the Court and the United States Trustee
from having to consider numerous fee applications involving
relatively modest amounts of fees and expenses. (Enron
Bankruptcy News, Issue No. 11; Bankruptcy Creditors' Service,
Inc., 609/392-0900)
ENRON PROPERTY: Case Summary & Largest Unsecured Creditors
----------------------------------------------------------
Debtor: Enron Property & Services Corp.
1400 Smith Street
Houston, Texas 77002
Bankruptcy Case No.: 02-10464
Type of Business: The Debtor provides real estate, facility and
services to Enron Corp. and third parties.
Chapter 11 Petition Date: February 1, 2002
Court: Southern District of New York (Manhattan)
Judge: Arthur J. Gonzalez
Debtor's Counsel: Melanie Gray, Esq.
Weil, Gotshal & Manges LLP
700 Louisiana, Suite 1600
Houston, Texas 77002
Telephone: (713) 546-5000
-and-
Brian S. Rosen, Esq.
Weil, Gotshal & Manges LLP
767 Fifth Avenue
New York, New York 10153
Telephone: (212) 310-8000
Total Assets: $358,554,800
Total Debts: $193,968,000
Debtor's Largest Unsecured Creditors:
Entity Nature Of Claim Claim Amount
------ --------------- ------------
MCSi, Inc. Contract $1,700,000
Mr. Steve McMahon
Bob Higgenbotham
8801 Jameel, Suite 180
Houston, TX 77040
Tel: (713) 895-9696, x 212
SBFI, Inc. Contract $1,425,761
Mr. Laurence S. Slovin
Craig Veach or
Legrand Crapps
125 Maiden Lane, 14th Floor
New York, NY 10038
Tel: (803) 321-0313
Jimenez Contract Contract $1,176,133
Services, Inc.
Mr. Michael J. Carr
Cheryl Luck
1293 Post Oak Road, Suite 100
Houston, TX 77055
Tel: (713) 681-6407
W. S. Bellows Contract $1,100,000
Construction Corp.
Mr. Robert A. Higgins
1906 Afton
Houston, TX 77055
Fax: (713) 812-2687
Steve Imburgia
Tel: (713) 680-2132
C. W. Henderson Contract $885,000
Electric, Inc.
Mr. Cliff Henderson
Russell Drennan
P.O. Box 91057
Houston, TX 77291
(281) 447-3426
Constructors & Contract $795,000
Associates, Inc.
Mr. David W. Conine
909 Fannin Street, Suite 1125
Houston, TX 77010-1006
Tel: (713) 650-6420
Fisk Electric Company Contract $605,000
Mr. James Muhl
111 T.C. Jester Boulevard
Houston, TX 77007
Tel: (713) 868-6111
Avnet, Inc. Contract $600,000
Mr. Mark Zerbe
7433 Harwin Drive
Houston, TX 77036
Jim McFadden
Tel: (713) 780-7770
McCoy Enterprises, Inc. Contract $586,538
dba McCoy, Inc.
Mr. August H. Saxe
6869 Old Katy Road
Houston, TX 77024
Bobby Hollis
Tel: (713) 802-6750
Electronic Data Contract $580,000
Carriers, Inc.
Mr. George Gilbert
2228 Wirtcrest, Suite A
Houston, Texas 77055
Kay McCaghren
Tel: (713) 680-2221
Marek Brothers Contract $573,576
Systems, Inc.
Mr. Mike Holland
3539 Oak Forest Drive
Houston, TX 77018
Tel: (713) 681-2626
Tri-Universal Contract $493,000
Enterprises, Inc.
Mr. Mike Macejewski
4523 Irvington
Houston, TX 77009
Tel: (713) 691-3393
Tellepsen Builders, L.P. Contract $478,259
Mr. James Bryant
777 Benmar, Suite 400
Houston, TX 77060-3607
Mike Durham
Tel: (281) 447-8100 x 131
Burns DeLatte & Contract $465,000
McCoy, Inc.
Jim Angelle
320 Westcott
Houston, TX 77007
Tel: (713) 861-3016
GraphTec, Inc. Contract $465,000
Mr. Dillard R. Grasty
8411 Rannie Road
Houston, TX 77080
Tel: (713) 690-9999
Office Specialty, Ltd. Contract $405,000
Mr. Ram Ramkumar, CEO
1865 Birchmount Road
Scarborough, Ontario M1P 2J5
Julie Wright
Tel: (905) 836-7676
Lanier Worldwide, Inc. Contract $350,000
Mr. Madhu Kamdar
2300 Parklake Drive N.E.
Atlanta, GA 30345
Pat Weisner
Tel: (281) 295-4665
Pitney Bowes Management Contract $310,000
Services
Mr. Gene Alhorn
910 Jefferson, Suite 3900
Houston, TX 77002
Dave Richardson
Tel: (713) 547-7811
G.L. Seaman & Company of Contract $297,518
Houston dba Debner +
Company
Mr. Tim Debner
2000 Bering Drive, Suite 100
Houston, TX 77057
Sally Herbert
Tel: (713) 732-1300
Fisher Gulfcoast, Inc. Contract $283,000
Mr. James R. Fisher
6910 Renwick
Houston, TX 77081
Tel: (713) 664-8204
ENRON: Bankr. Court to Hear from 401(k) Plaintiffs on Feb. 13
-------------------------------------------------------------
The Gottesdiener Law Firm announced that the U.S. Bankruptcy
Court for the Southern District of New York will hold hearings
on February 13th and February 20th regarding the firm's attempts
to recover financial losses suffered by participants in the
company's 401(k) Plan.
Specifically, the Court will consider the firm's motion to lift
the "automatic stay" that has protected Enron from suit since it
filed for bankruptcy on December 2, 2001, and the firm's attempt
to block Enron from tapping into an $85 million fiduciary
liability insurance policy earmarked to compensate workers.
The legal maneuver would allow workers to proceed in their
efforts to establish that the company violated federal pension
laws in its handling of its 401(k) Plan, and share in whatever
proceeds may be available after secured creditors' claims are
satisfied in the bankruptcy.
"We're gratified that Judge Gonzalez has granted us a hearing
and look forward to giving voice to the Enron worker's
concerns," said Eli Gottesdiener, head of the Gottesdiener Law
Firm which filed suit on behalf of Enron 401(k) Plan
participants in November 2001.
The papers the firm filed with the bankruptcy court are
available at on the Website dedicated to the 401(k) litigation,
www.enronsuit.com.
Based in Washington, D.C., the Gottesdiener Law Firm --
http://www.gottesdienerlaw.com-- and its principal attorney,
Eli Gottesdiener, specialize in complex civil and criminal
litigation on behalf of plaintiffs and defendants in federal and
state courts. Mr. Gottesdiener has prosecuted some of the
leading pension and 401(k) plaintiffs' class action cases in the
country, including Mehling v. New York Life Ins. Co., a pending
pension and 401(k) class action case against New York Life
Insurance Company; Gottlieb v. SBC Communications, Inc., a
401(k) class action against SBC; and Franklin (I and II) v.
First Union Corp., two 401(k) class actions against First Union
Corporation that were recently successfully settled for $26
million.
ENRON CORP: A.M. Best Says Bankruptcy Costs Insurers $3 Billion
---------------------------------------------------------------
The failure of energy-trading giant Enron Corp., has hit the
portfolios of several insurers with investment exposures as of
Sept. 30, 2001, totaling more than $3 billion, according to an
A.M. Best statistical study.
In total, the life/health insurance industry reported a market-
value investment worth $2.8 billion as of Sept.30, 2001, with
the majority of investment in corporate bonds, based on their
quarterly filings with the National Association of Insurance
Commissioners.
The property/casualty industry reported a market-value
investment of $604 million for the same period, also with the
majority of holdings in Enron's corporate bonds.
Many life/health and property/casualty insurers hold Enron
securities, including corporate bonds, common stocks and
preferred stocks. Among the highest reported values are John
Hancock Financial Services Inc., with $320 million invested in
Enron. Swiss Re held Enron bonds in its corporate bond
portfolio, which has an estimated loss of $31 million, based on
the market valuation in mid-December. The company also had
exposure through its portfolio of credit default swaps amounting
to $28 million. Other companies affected include Hartford
Financial Services, St. Paul Cos., and Reinsurance Group of
America Inc.
The full 44-page A.M. Best statistical study provides details on
the individual investments of the major insurance companies,
including their holdings in Enron's common and preferred stock
and corporate bonds. The study shows the number of shares, book
value, market value, statement value and actual costs as of
Sept. 30, 2001, the most recent date for which data is
available. Data on corporate bonds also includes the year bonds
were acquired, maturity dates and rates.
A.M. Best expects to update this statistical study with year-end
2001 data when it becomes available, as certain positions might
have been reduced after the quarterly filing, and some insurers
will have to write down these assets.
Subscribers to BestWeek can download a printed copy of the full
44-page statistical study for $50 or a combination of the
printed study plus a spreadsheet file of the study data for $150
from the BestWeek Web site at
http://www3.ambest.com/frames/fs.asp?site=bestweek&tab=4
Nonsubscribers can download a copy of the full 44-page study for
$100 or a combination of the printed study plus a spreadsheet
file of the study data for $275 from the BestWeek Web site at
http://www3.ambest.com/frames/fs.asp?site=bestweek&tab=4
A.M. Best Co., established in 1899, is the world's oldest and
most authoritative insurance rating and information source. For
more information, visit A.M. Best's Web site at
http://www.ambest.com
EUPHONIX: Gets Shareholders' Nod to Restructure Promissory Notes
----------------------------------------------------------------
Euphonix, Inc. (OTCBB: EUPH.OB), said that its Board of
Directors has unanimously approved, and the Company will file, a
Form 15 with the Securities and Exchange Commission to suspend
its obligations to file periodic reports, including Forms 10-Q
and 10-K, with the Securities and Exchange Commission. As a
result of filing the Form 15 the Company's shares will cease
trading on the OTC Bulletin Board. Certain market makers may
continue to make a market for Euphonix's stock on the "Pink
Sheets Market." The Company will continue to provide
information to shareholders as required by the California
Corporations Code.
One of the practical effects of this decision will be to remove
the burdensome accounting, legal and administrative costs
associated with SEC reporting, which has been a material cost
element of the Company's operating cost. The projected
accounting and legal cost savings will help to bring the
Company's expenses more in line with its revenues and will
enable Company's management to focus more of its time on
business issues.
The Company also announced that it has secured necessary
shareholder approval for its $6.0 million line of credit secured
in November 2001 and the restructuring of the Company's existing
promissory notes, which included extending the maturity dates to
December 2003. The line of credit will be used to support
investment in new product development and future operations. The
line of credit was obtained from Dieter Meier and Walter Bosch
who are significant shareholders and creditors of the Company
and also serve on the Company's Board of Directors.
Based in Palo Alto, California, Euphonix develops, manufactures
and supports networked digital audio systems for film/post
production, broadcast, music, sound reinforcement and multimedia
applications.
Founded in 1988, Euphonix has delivered more large format
digital-control mixing consoles worldwide than any other
manufacturer and is the first professional console manufacturer
to deliver the combination of a 24bit 96kHz audio console and 48
track multi-track recorder to the industry. For more information
call (650) 855-0400 or visit the Euphonix Web Site at
http://www.euphonix.com
EXODUS COMMS: Court Okays Venture Asset as Marketing Agent
----------------------------------------------------------
Exodus Communications, Inc., and its debtor-affiliates obtained
Court order authorizing the employment and retention of Venture
Asset Group, LLC as asset marketing agent.
According to Adam W. Wagner, the Debtors' Senior Adviser for
Legal and Corporate Affairs, Venture Asset is employed in
connection with the sale, lease or other disposition of certain
of the Debtors' Internet Data Centers and "in place" personal
property used with the operation of the said facilities as
stand-alone operating units in the United States, Canada and
abroad.
The Debtors sought to retain Venture Asset as marketing agent
because:
A. Venture Asset and its principals have an excellent reputation
of providing high quality asset marketing service to
debtors and creditors in bankruptcy reorganizations and
other debt restructurings,
B. Venture Asset has demonstrated an extensive knowledge of the
Debtors' assets and how to maximize their value,
C. Venture Asset is capable of providing the Debtors with asset
marketing services where the Debtors intend to sell, lease
or otherwise dispose of assets as stand alone operating
units.
Under the agreement, Venture Asset will perform specific tasks
in the areas of:
A. Feasibility Plans - Venture Asset shall develop, complete and
deliver a feasibility plan for the sale, acquisition,
refinancing or other disposition of assets in accordance
with the Debtors' goals and objectives and provide ongoing
advice to the Debtors regarding transactions.
B. Physical Inspection of Property - Venture Asset shall inspect
property and document physical inspection for potential
buyers (including photos, verification of assets,
comparison of plans to actual inspection, environmental,
zoning or other issues), verify list of assets and
personal property, meet with landlords, vendors, suppliers
or other contacts necessary to document current state of
property and determine and maximize value.
C. Document Gathering or Due Diligence - Venture Asset shall
prepare due diligence list and requirements, gather due
diligence information from various internal and external
resources to enable the Debtors to present a clear, concise
presentation for potential buyers and prepare due diligence
binders with all documentation available for potential
buyer review.
D. Government Regulation and Compliance Check- Venture Asset
shall confirm issuance of all necessary government
approvals, identify and list all necessary government
approvals not obtained by the Debtors and assist the
Debtors in obtaining any additional approvals necessary for
sale of property or transfer of assets.
E. Marketing - Venture Asset hall prepare one-page flyers on
each property for general marketing purposes, prepare in-
depth or binder documents on each property for analysis by
qualified buyers, contact potential buyers of property or
assets through a variety of means including telephone, e-
mail, and in-person solicitations, advertising or marketing
in industry publications, newsletters and websites and any
other means required to ensure sufficient inquiry on the
sale of assets and property. Also, the firm shall receive,
track and follow-up inquiries for sale of assets and or
property, keeping records of all activity for inspection by
the Debtors, arrange for tours or inspections of property
and oversee sales activity and facilitate fast track
pipeline for sale process from initial contact through
letter of intent.
F. Negotiations - Venture Asset shall meet with landlords to
discuss rent reductions or abatement during marketing
activity and return of security deposits or other
collateral where possible, assist the Debtors in removing
liens against property to enable legal sale of such
property, negotiate sale of property and assets acting on
behalf of the Debtors seeking maximum recovery on all sales
and work with potential purchasers to remove contingencies
on sale.
G. Drafting of Contracts and Agreements - Venture Asset shall
act as resource for buyer in drafting purchase documents and
related agreements, act as resource for the Debtors in
review and analysis of purchase documents and related
documents and facilitate quick process for legal counsel
review and manage documents tracking.
H. Third Party Consents - Venture Asset shall act as resource
for Debtors' legal counsel in preparing paperwork, motions
and supporting documents necessary for court approval of
transaction.
I. Closing or post-closing in the case of property sale -
Venture Asset shall work with the Debtors' legal counsel to
obtain closing statement after sale review and verify closing
statement for accuracy, review title policy for conformity
and prepare and deliver post-closing documentation binder
to the Debtors.
Venture Asset will be compensated with transaction fees for each
closing equivalent to:
A. 2.25% of the consideration actually paid to the Debtors for
each closing of a sale of a Debtors' asset.
B. 2.25% of the sum of the total rental stream for each closing
of a lease by the Debtors' asset.
C. 10% of the amount of the consideration actually paid to the
Debtors for each closing of a sale or other disposition of
leased assets and upon closing of a transaction that
exceeds the sum of the salvage value for the assets that
have been sold. (Exodus Bankruptcy News, Issue No. 13;
Bankruptcy Creditors' Service, Inc., 609/392-0900)
FEDERAL-MOGUL: US Trustee Amends Creditors' Committee Membership
----------------------------------------------------------------
Pursuant to section 1102(a)(1) of the Bankruptcy Code, the
United States Trustee amends the membership of the Official
Committee of Unsecured Creditors in the chapter 11 cases of
Federal-Mogul Corporation and its debtor-affiliates by replacing
R2 Investments with Gramercy Capital Advisors LLC. The Official
Committee of Unsecured Creditors is now composed of:
A. Gramercy Capital Advisors, LLC
Attn: Nicholas W. Walsh
3 Sheridan Square, Suite 11E, New York, NY 10014
Phone: (646) 336-5740 Fax: (212) 255-6624
B. Aspen Advisors LLC
Attn: Neil Subin
152 West 57th St., New York, New York 10019
Phone: (561) 223-0089 Fax: (954) 697-4687
C. Teachers Insurance and Annuity Association of America
Attn: Roi G. Chandy
730 Third Avenue, New York, New York 10017
Phone: (212) 916-6139 Fax: (212) 916-6140
D. U.S. Bank Trust National Association,
as Indenture Trustee
Attn: Lawrence Bell
1420 Fifth Avenue, 7th Floor, Seattle, Washington 98101
Phone: (206) 344-4654 Fax: (206) 344-4630
E. NTN Bearing Corporation of America
Attn: Craig K. Dunn
1600 E. Bishop Court, Mt. Prospect, Illinois 60056
Phone: (847) 298-7500 Fax: (847) 294-1209
F. Cummins, Inc.
Attn: Paul W. Malone II
500 Jackson St., M/C 60701, Columbus, Indiana 47201
Phone: (812) 377-9632 Fax: (812) 377-3272
G. Leggett & Platt Aluminum Group
Steffan B. Sarkin
75 N. East Ave., Suite 401, Fayetteville, Arkansas 72701
Phone: (501) 443-1455 Fax: (501) 443-7058 (Federal-
Mogul Bankruptcy News, Issue No. 10; Bankruptcy
Creditors' Service, Inc., 609/392-0900)
FRUIT OF THE LOOM: Has Until June 30 to Act on Unexpired Leases
---------------------------------------------------------------
Judge Walsh rules that Fruit of the Loom has until June 30, 2002
to assume, assume and assign, or reject 29 unexpired real
property leases. (Fruit of the Loom Bankruptcy News, Issue No.
47; Bankruptcy Creditors' Service, Inc., 609/392-0900)
GLOBAL CROSSING: Gets Approval to Continue Funding Foreign Units
----------------------------------------------------------------
Global Crossing Ltd., and its debtor-affiliates request
authorization to continue funding their foreign affiliates who
have not sought chapter 11 protection in these cases to enable
them to continue in existence while the Debtors reorganize.
Harvey R. Miller, Esq., at Weil Gotshal & Manges LLP, advises
that the Non-Debtor Foreign Affiliates rely on daily funding of
their operations through the Concentration Account without
which, the Non-Debtor Foreign Affiliates would likely cease
operations. The loss of a Non-Debtor Foreign Affiliate would
severely impair the Debtors' provision of services as they are
critical to the Debtors' global network. They also own, service
and maintain the Debtors' network and administer the Debtors'
businesses and properties around the world. Mr. Miller submits
that the loss of one country would limit the Debtors' global
reach and impact their competitive edge and therefore, without
the Non-Debtor Foreign Entities, the Debtors would be forced to
shut down their network which would substantially impair the
going concern value of all of the Debtors' businesses.
The protections afforded to debtors under the Bankruptcy Code do
not apply to creditors in foreign jurisdictions and will not
protect the Non-Debtor Foreign Affiliates. If the Debtors ceased
to fund the Non-Debtor Foreign Entities, Mr. Miller fears that
such entities may be insolvent and would be at the mercy of
their creditors who, pursuant to local law, could seize assets,
initiate local insolvency proceedings and impose personal
liability on the officers and directors of such Non-Debtor
Foreign Entities.
* * *
Judge Gerber granted the Debtors' request on an interim basis
pending receipt of than objections before March 21, 2002 and a
hearing on March 26, 2002. If no objections are filed, Judge
Gerber orders that this interim order shall be deemed a final
order. (Global Crossing Bankruptcy News, Issue No. 2; Bankruptcy
Creditors' Service, Inc., 609/392-0900)
HARE KRISHNA: Will File for Chapter 11 Reorg. Later This Month
--------------------------------------------------------------
At least a dozen temples, related entities and individuals
affiliated with the International Society for Krishna
Consciousness (ISKCON), better known as the Hare Krishna
Movement, will file for Chapter 11 bankruptcy protection later
this month.
The Chapter 11 bankruptcy focuses on reorganization rather than
liquidation of religious assets. It is being filed to deal with
claimants including a $400 million dollar lawsuit against
Krishna temples.
That suit, first filed in Federal Court in June 2000, alleges
children were abused at the religious society's boarding schools
in the 1970's and 1980's. The Krishnas prevailed when the suit
was dismissed in September 2001, but a similar $400 million suit
was later filed in Texas State Court.
The lawsuit, ISKCON leaders say, seeks far more money than the
financial value of all the Krishna temples in North America. In
essence, the suit threatens to shut down an entire religion.
"Rather than wasting millions of dollars to fight this suit,
Chapter 11 reorganization will help ISKCON communities to
establish a substantial, yet reasonable, fund to help any young
person who may have been abused," said Anuttama Dasa, ISKCON
Director of Communications. "We want first and foremost to heal
our communities and our young people," Dasa said.
Through the reorganization, Krishnas hope to assure that all
victims of past abuse--including youth who may have chosen not
to join the suit--are compensated according to the severity of
their grievance.
"Chapter 11 protection will also assure that innocent families
and congregations do not have their places of worship sold out
from under them, " said Dasa. "We believe that innocent people
should not be punished for the deeds of individual deviants who
acted in total violation of our religious principles and
teachings."
The New York Times reported in 1999 that the Krishnas were
"unusually candid" in their efforts to address past abuse. In
1990, ISKCON established policies mandating abuse prevention
training and the reporting of any allegations of abuse to
government authorities. In 1996, an independent Children of
Krishna organization was formed to provide grants for education
and training for Krishna youth.
In 1998, a professionally staffed Child Protection Office was
established to investigate allegations of past abuse, provide
grants for Krishna youth who may have been abused, and to assure
the ongoing protection of Krishna children.
"Chapter 11 is a further effort to address past problems by
creating an orderly and efficient procedure for dealing with and
maximizing return to claimants," said Sandy Frey, Bankruptcy
Counsel.
The International Society for Krishna Consciousness (ISKCON) is
part of the ancient Vaishnava tradition, a monotheistic faith
within Hindu culture. ISKCON was founded by A.C. Bhaktivedanta
Swami Prabhupada, who first brought the Krishna tradition from
India to the west in 1965.
HAYES LEMMERZ: US Trustee Questions KPMG's Disinterestedness
------------------------------------------------------------
Frank J. Perch, III, Esq., tells the Court that the U.S. Trustee
objects to Hayes Lemmerz's application to employ KPMG because:
A. According to the Application, KPMG has been employed by the
Debtor as its accountants since 1992.
B. The Application further recites that the Debtor announced in
September 2001 that it would be necessary to restate
earnings for fiscal year 2000 and first quarter 2001 due to
the discovery of "accounting errors." Indeed, Debtor
subsequently announced that it also needed to restate the
financial results for fiscal year 1999.
C. The Application does not disclose whether KPMG was involved
in preparing the financial reports that are now being
restated or issued an audit opinion thereupon, although the
strong likelihood of same is suggested by the fact that
KPMG has been acting as accountant to the Debtor since
1992.
D. If KPMG prepared the financial statements that are now being
restated, or issued an audit opinion thereupon, KPMG may
have exposure to claims by creditors or equity holders, or
even to claims by the Debtor itself, relating to its pre-
petition work. The UST questions KPMG's disinterestedness
in light of the foregoing. (Hayes Lemmerz Bankruptcy News,
Issue No. 5; Bankruptcy Creditors' Service, Inc., 609/392-
0900)
HEAFNER TIRE: Ratings Still on Watch Neg. Following Tender Offer
----------------------------------------------------------------
Standard & Poor's ratings on Heafner Tire Group Inc. remain on
CreditWatch with negative implications, where they were placed
November 19, 2001. Heafner's total debt as of September 29,
2001, was about $288 million.
Heafner announced that it has commenced a tender offer for all
of its $150 million 10% senior notes due 2008. The company is
offering to purchase the notes for $375 per $1,000 principal
amount, a significant discount to the face value of the notes,
which would result in impairment of the existing bondholders.
Standard & Poor's would consider the purchase of debt at the
discounted offer price to be tantamount to a default. The offer
is conditioned upon Heafner's receipt of funds from an overall
recapitalization plan. If the tender offer is completed, the
corporate credit rating will be lowered to 'SD' and the senior
unsecured debt rating will be lowered to 'D'.
Heafner is a leading independent supplier of passenger car and
light truck tires to the domestic replacement tire market. The
company has reported weak operating results during the past year
due to reduced demand for consumer and commercial replacement
tires (resulting from the soft U.S. economy), high expense
levels following several acquisitions, and the negative effects
of Ford Motor Company's 2001 recall of certain Firestone tires.
Credit protection measures are very weak, with total debt to
EBITDA of about 9 times and liquidity is constrained, with only
$18 million available under a revolving credit facility as of
September 29, 2001.
Even if the proposed tender offer does not occur, the ratings on
the company could be lowered if it appears that financial
performance will fall below expected levels, operating
improvements will be substantially delayed, or liquidity will
become more constrained.
Ratings Still On Creditwatch Negative
Heafner Tire Group Inc.
Corporate credit rating B-
Senior secured debt B-
Senior unsecured debt CCC+
IVC INDUSTRIES: No Date Yet for Special Shareholders' Meeting
-------------------------------------------------------------
A special meeting of the stockholders of IVC Industries, Inc., a
Delaware corporation, at 10:00 a.m., local time, on [meeting
date yet to be announced] at the offices of Rosenman & Colin
LLP, 575 Madison Avenue, New York, N.Y. 10022, for the following
purpose:
To consider and vote upon a proposal to adopt and
approve the merger agreement, dated December 21, 2001,
and amended and restated on January 22, 2002, between
Inverness Medical Innovations, Inc., a Delaware
corporation, Nutritionals Acquisition Corporation, a
Delaware corporation and a wholly owned subsidiary of
Inverness, and IVC Industries, Inc., a Delaware
corporation. Under the terms of the merger agreement,
upon the adoption and approval of the merger
agreement by holders of IVC common stock and the
completion of the merger: (i) Nutritionals Acquisition
Corporation will merge with and into IVC, with IVC
continuing as the surviving corporation and (ii)
each outstanding share of IVC common stock will be
cancelled and converted into the right to receive $2.50
in cash, other than any outstanding share of IVC common
stock that is held by stockholders who perfect their
appraisal rights under Delaware law.
The record date has yet to be established for the purpose of
determining the IVC stockholders who are entitled to receive
notice of and to vote at the special meeting.
Vitamin maker IVC Industries' revenues are fortified with
private-label sales. The company markets more than 600 vitamin,
mineral, and herbal supplements. Private-label products and its
own Fields of Nature, Synergy Plus, and LiquaFil brands are sold
in drugstores, retail chains, and health food stores. The
company's Intergel soft gel factory produces the LiquaFil line
of products. Wholesale club operator Costco is IVC's largest
customer, accounting for almost half of sales. IVC's chairman
and CEO E. Joseph Edell owns almost 30% of the company.
The Company has been pursuing, among other initiatives; i)
obtaining alternative sources of financing, ii) seeking
additional sales opportunities within its core business, iii)
seeking new sales opportunities through non-traditional channels
of distribution, iv) reducing expenses to a level that would
provide the Company with sufficient cash flows to meet its
obligations, v) merger or sale of the Company, and or vi) a
combination of any of the foregoing.
IT GROUP: Seeks Court Approval to Sell Substantially All Assets
---------------------------------------------------------------
Based upon an analysis of their ongoing and future business
prospects, The IT Group, Inc.'s management, Board of Directors,
and financial advisors have concluded that, given the company's
continuing cash losses, its inability to obtain additional
financing, the competitive nature of their industry, and their
diminishing operating and profit margins, the best way to
maximize the value of their estates is to sell their assets
as a going business concern, thereby preserving the substantial
goodwill of the business, maintaining customer relationships and
avoiding a liquidation sale of the Debtors' business at
depressed prices.
Selling their assets now enables the Debtors to reduce the risk
that enterprise value will deteriorate. Moreover, by selling
the Assets now, the Debtors will relieve themselves of certain
ongoing costs and expenses, thereby minimizing administrative
expenses and maximizing creditor recoveries.
Accordingly, David S. Kurtz, Esq., at Skadden, Arps, Slate,
Meagher & Flom, argues, well-articulated business reasons
exist for approving the Asset Sale, such that the "business
purpose" test under Bankruptcy Code section 363 is met. See
Lionel, 722 F.2d at 1071 ("most important[] perhaps, [is]
whether the asset is increasing or decreasing in value").
There is more than adequate business justification for the
Debtors' to sell substantially all of their the Assets, Mr.
Kurtz continues, directing the Court's attention to In re Tempo
Technology Corp., 202 B.R. 363 (D. Del. 1996), aff'd, 141 F.3d
1155 (3d Cir. 1998) (sale of substantially all of a chapter 11
debtor's assets pursuant to a section 363(b) motion where the
debtor "faced a severe cash shortfall and had no readily
available source of investment capital or loans," and would
shortly have run out of cash absent the debtor-in-possession
financing provided by the prospective purchaser); see also In re
Delaware and Hudson Railway, 124 B.R. at 177 (affirming
bankruptcy court's approval of sale of substantially all assets
where debtor would have been "in liquidation mode if required to
delay a sale until after filing a disclosure statement and
obtaining approval for a reorganization plan"); Titusville
Country Club, 128 B.R. at 400 (bankruptcy court granted
expedited hearing on 363(b) motion based on "deterioration" of
debtor's assets); In re Coastal Indus., Inc., 63 B.R. 361, 366-
69 (Bankr. N.D. Ohio 1986) (approving expedited 363(b) sale five
weeks post-petition to buyer with "the name recognition required
by [the debtor's] customers" where debtor was suffering
operating losses and lacked financing to continue its
operations).
Accordingly, the Debtors ask Judge Walrath to affirm the
Debtors' business judgment and grant them authority to sell
substantially all of their assets in a competitive bidding
process to the highest and best bidder. (IT Group Bankruptcy
News, Issue No. 3; Bankruptcy Creditors' Service, Inc., 609/392-
0900)
INTEGRATED HEALTH: Wants Removal Time Further Extended to May 27
----------------------------------------------------------------
Integrated Health Services, Inc., and its debtor-affiliates seek
a seventh extension of the time within which they may file
notices of removal of related proceedings, under Bankruptcy Rule
9027(a), through May 27, 2002.
The Debtors believe that they may be party to Pre-petition
Actions currently pending in the courts of various states and
federal districts. However, due to the size and complexity of
these cases, the Debtors have not had a full opportunity to
investigate their involvement in the Pre-Petition Actions.
Because the attention of the Debtors' personnel and management
has been focused primarily on stabilizing the business,
administering the bankruptcy proceeding and developing a
business plan to take the Debtors through reorganization, the
Debtors and their professionals have not had sufficient time to
fully review all of the Pre-Petition Actions to determine if any
should be removed pursuant to Bankruptcy Rule 9027(a).
The Debtors submit that the extension of the removal period
requested is in the best interests of the Debtors, their estates
and their creditors because this will afford them an opportunity
to make more fully informed decisions concerning the removal of
each Pre-Petition Action so that they do not forfeit the
valuable rights afforded to them under 28 U.S.C. section 1452.
On the other hand, the Debtors represent, the rights of the IHS
Debtors' adversaries, will not be prejudiced by such an
extension, because any party to a Pre-Petition Action that is
removed may seek to have it remanded to the state court pursuant
to 28 U.S.C. section 1452(b). (Integrated Health Bankruptcy
News, Issue No. 28; Bankruptcy Creditors' Service, Inc.,
609/392-0900)
INTERPLAY ENTERTAINMENT: Appoints Herve Caen as Interim CEO
-----------------------------------------------------------
In a letter dated January 7, 2002, Brian Fargo informed
Interplay Entertainment Corporation of his resignation as a
director, Chairperson of the Board of Directors and Chief
Executive Officer of the Company, effective January 21, 2002.
Mr. Fargo stated several reasons for his resignation, which are
summarized below.
Mr. Fargo gave as reasons for his resignation the alleged
reduction in his responsibilities as chief executive of the
Company commencing in September 2001, including his supervision
of the Company's legal and contractual affairs, global strategy
and development of corporate relationships, and internal and
external product development activities. Mr. Fargo cites as
specific examples the instruction to company departments to
report directly to Herve Caen, the Company's President, and
Nathan Peck, the Company's Chief Administrative Officer.
Mr. Fargo also references actions by Messrs. Caen and Peck to
stop an audit by the Company of Virgin Interactive Entertainment
Limited, which Mr. Fargo alleges is contrary to his express
instructions in September 2001 to continue to seek the audit.
Mr. Fargo also references the return by the Company of $1
million to Titus Interactive S.A. without his approval.
In response to reasons given by Mr. Fargo, Interplay
Entertainment offers the following:
"Mr. Fargo has not regularly attended to his
responsibilities as Chief Executive Officer of the Company for
more than 4 months. Instead, Mr. Fargo has focused his energies
on attempting to secure a highly lucrative severance and
separation package for himself. The Company is investigating
whether Mr. Fargo, during his 4-month absence from the Company,
has improperly engaged in competition with the Company by, among
other things, soliciting Company employees. The Company is
considering pursing civil actions against Mr. Fargo for breach
of his duties to the Company.
As to Mr. Fargo's contention that he has been effectively
removed from his ability to supervise the Company's affairs,
including its legal and contractual affairs, its global
corporate strategy, its development of corporate relationships
and its internal and external product development, the Company
contends that he could not have supervised these functions while
absent from the workplace for a third of the year. The
supervision of these affairs requires regular attendance. To the
extent Mr. Fargo is not currently supervising these functions,
it is as a result of his own misconduct and his failure to
perform the duties and responsibilities owed by him to the
Company. Having absented himself from the Company, it is
inequitable for Mr. Fargo to claim that he does not have
supervisory authority over these important and necessary
corporate functions.
Mr. Fargo's allegation that Virgin has refused to let the
Company's auditors perform an audit is without merit. Had Mr.
Fargo been attending work, he would have known that the audit is
currently in progress.
The circumstances of the Company's repayment to Titus of $1
million, which is referred to in Mr. Fargo's letter as a reason
for his resignation, has been publicly disclosed in the
Company's filings with the Securities and Exchange Commission.
The Company agreed to sell to Titus certain distribution
rights to the Company's products. Because of Titus' relationship
with the Company, the transaction was conditional upon approval
of the transaction by a Board committee of disinterested
directors, of which Mr. Fargo was a member. Titus advanced $1
million to the Company to be held as a good faith deposit
against the purchase price pending approval of the transaction
by Mr. Fargo and the other committee members. The Board
committee, however, never approved the transaction.
Consequently, the agreement was terminated and the $1 million
deposit was returned to Titus.
In response to Mr. Fargo's letter, the Company informed Mr.
Fargo that his actions constituted violations of his employment
agreement, and provided him with thirty (30) days to cure his
performance defects and immediately carry out the
responsibilities and duties required of him by his employment
agreement. Mr. Fargo declined to return to work at the Company,
and his resignation took effect on Monday, January 21, 2002."
On January 28, 2002, the Board of Directors appointed Herve
Caen, the President and a director of the Company, as interim
Chief Executive Officer.
Not exactly a model of gentility, Interplay Entertainment makes
PC and console video games with such serene titles as Dungeon
Master II, Redneck Rampage, and Torment. Among the subsidiaries
and divisions under the Interplay umbrella are 14 Degrees East
(strategy and puzzle games), Black Isle (role playing games),
Shiny Entertainment (cartoon animation), Tantrum (action games),
and Digital Mayhem. Struggling to rebound from financial
problems, Interplay is putting more focus on its console games.
Interplay's shareholders include French software firm Titus
Interactive (nearly 44%); Universal Studios (about 15%); and
founder, chairman, and CEO Brian Fargo (13%). At September 30,
2001, the company reported a stockholders' equity deficit of
about $24 million.
KAISER ALUMINUM: Missed Payment Drags Ratings to Default Level
--------------------------------------------------------------
Standard & Poor's lowered its corporate credit and subordinated
debt ratings on Kaiser Aluminum & Chemical Corp. to 'D' and
removed them from CreditWatch. Standard & Poor's rating on the
company's senior unsecured debt is lowered to double-'C' from
triple-'C' and remains on CreditWatch with negative
implications.
The actions result from the company's missed $25.5 million
interest payment on its 12-3/4% senior subordinated notes.
Ratings were lowered and placed on CreditWatch on January 15,
2002 following Kaiser's announcement that it is in discussions
with bondholders to consider restructuring alternatives.
The 'D' corporate credit rating indicates that Standard & Poor's
expects the default will be general and the issuer will fail to
meet its other financial obligations as they come due despite
cash balances of $132 million and availability under its
modified $100 million revolving credit facility as of
January 29, 2002. Kaiser disclosed that it has retained
financial advisors and that these restructuring alternatives
could result in the nonpayment of principal and interest on the
9-7/8% notes (approximately $174 million outstanding) due
Feb. 15, 2002, and interest due April 15, 2002, on the 10-7/8%
senior notes (approximately $225 million outstanding) due 2006.
Ratings on the 10 7/8% and 9 7/8% notes will be lowered to 'D'
upon a missed payment, a bankruptcy filing, or the successful
execution of any potential coercive exchange offer at below par
value.
Standard & Poor's ratings on Maxxam Inc. and Pacific Lumber Co.
remain on CreditWatch with negative implications where they were
placed January 15, 2002. Maxxam Inc. guarantees the 12% senior
secured notes due Aug. 1, 2003, at its Maxxam Group Holdings
Inc. (MGHI) subsidiary. The actions on MAXXAM and Pacific Lumber
reflect concerns regarding Kaiser as well as issues affecting
the wood products business. Wood product market conditions are
weak, with oversupply and soft demand resulting in volatile
pricing for lumber and logs. In addition, the company has not
always been able to harvest at desired levels because the
governmental approval process has been slow, although it has
reportedly improved recently. Still, recent cost cutting
measures and a focus on unit cost optimization, should improve
cash flow and earnings coverages.
Although cash balances of $129 million at Maxxam Inc. and $36
million at MGHI as of September 30, 2001, are more than the
current outstandings of the MGHI notes and could be earmarked to
meet the August 1, 2003, maturity, heightened uncertainty exists
over whether these funds will be made available to meet the
maturity as well as a possible bankruptcy filing by Kaiser and
the ability of Kaiser's creditors to drag Maxxam into any
bankruptcy proceedings. In resolving its CreditWatch, Standard &
Poor's will review the operating conditions and financial
profile of Pacific Lumber and its ability to service the MGHI
debt as well as the aforementioned issues.
Ratings Lowered and Removed from CreditWatch
Ratings
Kaiser Aluminum & Chemical Corp. To From
Corporate credit rating D CCC
Subordinated debt D CC
Rating Lowered and Remaining on CreditWatch Negative
Rating
Kaiser Aluminum & Chemical Corp. To From
Senior unsecured debt CC CCC
Ratings Remaining on CreditWatch
with Negative Implications
MAXXAM Inc. Ratings
Corporate credit rating B
Senior secured debt CCC+
Pacific Lumber Co.
Corporate credit rating B
Maxxam Group Holdings Inc.
Senior secured debt CCC+
(gtd. by MAXXAM Inc.)
DebtTraders reports that Kaiser Aluminum & Chemicals' 12.750%
bonds due 2003 (KAISER2) are trading between 33 and 36. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=KAISER2for
real-time bond pricing.
KMART CORP: Signs-Up PricewaterhouseCoopers as Financial Advisor
----------------------------------------------------------------
Kmart Corporation, and its debtor-affiliates seek the Court's
authority to employ and retain PricewaterhouseCoopers as their
financial advisor, nunc pro tunc to the Petition Date.
Kmart CEO Charles C. Conaway relates that the Debtors engaged
PwC prior to the Petition Date to provide accounting, tax
consulting and financial advisory services. During this
engagement, Mr. Conaway tells the Court that PwC developed a
great deal of institutional knowledge regarding the Debtors'
operations, finance and systems. "Because such experience and
knowledge will be valuable in the reorganization process, the
Debtors wish to retain PwC to provide assistance during these
cases," Mr. Conaway explains.
Specifically, the Debtors will look to PwC to provide:
Financial Advisory Services
-- Assistance to the Debtors in the preparation of financial
related disclosures required by the Court, including the
Schedules of Assets and Liabilities, the Statement of
Financial Affairs, and Monthly Operating Reports;
-- Assistance to the Debtors with information and analyses
required pursuant to the DIP financing, including, but not
limited to, preparation for hearings regarding the use of
cash collateral and DIP financing;
-- Assistance in developing accounting and operating procedures
to segregate pre-petition and post-petition business
transactions;
-- Assistance with the identification and implementation of
short-term cash management procedures;
-- Assistance and advice to the Debtors with respect to the
identification of core business assets and the disposition of
assets or liquidation of unprofitable stores and other
operations;
-- Assistance with implementation of court orders;
-- Assistance with the identification of executory contracts and
leases and performance of cost and benefit evaluations with
respect to the affirmation or rejection of each;
-- Assistance regarding the evaluation of the present level of
operations and identification of areas of potential cost
savings, including overhead and operating expense reductions
and efficiency improvements;
-- Assistance in the preparation of financial information for
distribution to creditors and others, including, but not
limited to, cash receipts and disbursement analysis, analysis
of various asset and liability accounts, and analysis of
proposed transactions for which Court approval is sought;
-- Attendance at meetings and support for other professional
advisors in discussions with potential investors, bank and
other secured lenders, the Creditors' Committee appointed in
these chapter 11 cases, the U.S. Trustee and other parties in
interest and professionals they hired, as requested;
-- Assistance in responding to and tracking calls
received from suppliers in a call center, including the
production of various management reports reflecting call
center activity;
-- Assistance in claims processing, analysis and
reporting including plan classification modeling and claim
estimation;
-- Analysis of creditor claims by type, entity and individual
claim, including assistance with development of a database to
track such claims;
-- Assistance with selection of and oversight of a
tabulation agent, ballot design, development of tabulation
protocols, and tabulation reporting;
-- Assistance with plan distribution activities;
-- Assistance in the preparation of information and analysis
necessary for the confirmation of a Plan of Reorganization
in these chapter 11 cases;
-- Assistance in the evaluation and analysis of avoidance
actions, including fraudulent conveyances and preferential
transfers;
-- Testimony on various matters, as requested;
-- Other financial advisory and claims management
services consistent with PwC's role in these matters as may
be required or requested by the Debtors or their counsel; and
-- Other general business consulting or such other
assistance as Debtors' management or counsel may deem
necessary which are not duplicative of services provided by
other professionals in this proceeding.
Mr. Conaway adds that PwC may provide additional financial
advisory services, at the Debtors' request.
According to Mr. Conaway, PwC professionals providing assistance
in the Vendor Call Center will be performing repetitive tasks in
responding to numerous vendor calls including answering incoming
calls, communicating relevant factual information regarding the
proceedings and updating the Vendor Call Center Database to
reflect the outcome of the calls received. "Given the nature
and volume of supplier calls, it would not be practical to
maintain detailed time records for tasks performed in the Vendor
Call Center," Mr. Conaway asserts. Accordingly, the Debtors ask
the Court to allow PwC Vendor Call Center professionals to
submit only summary documentation within the firm's overall
applications.
The Debtors will compensate PwC pursuant to the firm's customary
hourly rates (which is subject to periodic adjustments):
Partners $500 - 595
Managers and Directors 325 - 490
Associates and Senior Associates 150 - 325
Administration and Paraprofessionals 75 - 140
Subject to the Court's approval, the Debtors and PwC agree that:
(1) Any controversy or claim in connection the services provided
by PwC shall be brought to the Bankruptcy Court or the
District Court for the Northern District of Illinois;
(2) PwC and the Debtors consent to the jurisdiction and venue of
such court as the sole and exclusive forum for the
resolution of such claims or lawsuits;
(3) PwC and the Debtors waive trial by jury;
(4) If the Court does not have jurisdiction over the claims and
controversies, PwC and the Debtors will submit first to non-
binding mediation; and if mediation is not successful, then
to binding arbitration; and
(5) Judgment on any arbitration award may be entered in any
court having proper jurisdiction.
Randall S. Eisenberg, Esq., a partner in PricewaterhouseCoopers
LLP, informs Judge Sonderby that the firm conducted a conflict
check on their computer database to identify its potential
relationship with parties in interest in these cases.
"As far as I have been able to ascertain, PricewaterhouseCoopers
has no known significant connection to the Debtors, their
creditors, equity security holders, other parties-in-interest or
their respective attorneys, except as disclosed to the Court,"
Mr. Eisenberg says.
According to Mr. Eisenberg, the firm may provide audit, tax and
consulting services to at least 111 parties in interest in these
cases. But Mr. Eisenberg clarifies that no services have been
provided to these parties in interest that could impact their
rights in the Debtors' cases. Nor does PwC's involvement in
these cases compromise its ability to continue such auditing,
tax and consulting services, Mr. Eisenberg emphasizes.
"To the best of my knowledge, PricewaterhouseCoopers is a
'disinterested person' as that term is defined in section
101(14) of the Bankruptcy Code," Mr. Eisenberg assures Judge
Sonderby.
If any new relevant facts or relationships are discovered, PwC
promises to file a Supplemental Affidavit with the Court
immediately.
Based on PwC's books and records, Mr. Eisenberg reports that the
firm received $3,215,170 from the Debtors for services performed
and expenses incurred -- including financial advisory, audit-
related, tax-related, and other consulting services -- during
the 90 days prior to the Petition Date. Mr. Eisenberg tells the
Court that PwC also received a retainer from the Debtors in the
amount of $1,000,000. Both parties have agreed that any portion
of the advance payments not used to compensate PwC for its pre-
petition services and expenses will constitute a retainer.
(Kmart Bankruptcy News, Issue No. 3; Bankruptcy Creditors'
Service, Inc., 609/392-0900)
KMART: Will Talk About Store Closings at End of First Quarter
-------------------------------------------------------------
As part of the process under Chapter 11, Kmart Corporation
(NYSE: KM) is reorganizing and evaluating the performance and
lease of every store.
As a result of this evaluation, Kmart has said that it will be
closing a number of stores. The exact number and locations have
not yet been determined. As the company said in a public
statement last week, when the decision about store closings is
made, it will inform its employees and make a public
announcement.
The evaluation and announcement are expected to be complete by
the end of Kmart's first quarter.
DebtTraders reports that KMart Corp.'s 8.800% bonds due 2010
(KMART8) are trading between 60 and 65. See
http://www.debttraders.com/price.cfm?DT_SEC_TICKER=kmart8for
real-time bond pricing.
LTV CORP: Reaches Agreement to End Non-Union Retiree Benefits
-------------------------------------------------------------
The LTV Corporation, and its debtor-affiliates, and the Official
Committee of Nonunion and Certain Union Retirees present Judge
Bodoh with an agreement regarding termination of certain retiree
benefits, which is quickly embodied in an Order entered by Judge
Bodoh.
By agreement, the Motion of the Debtor is granted, subject to
certain terms, and all objections are overruled. Under the
Agreement, LTV Steel and the other Debtors agree that:
(1) The Debtors will not terminate or modify any retiree
benefits, as defined in the Bankruptcy Code, covering the class
of retirees represented by the Official Committee before
February 28, 2002. Through that termination date, the Debtors
will collect contributions at the current levels for 2002
coverage under these plans. The Official Committee and the
Debtors agree that, effective on or after the termination date,
the Debtors may terminate retiree benefits.
(2) The Debtors will permit covered retirees to continue
medical insurance coverage in accordance with COBRA until the
last medical plan covering active employees in the "controlled
group", as that term is defined in section 414(t) of the
Internal Revenue Code, of which LTV Steel is a member, is
terminated.
(3) No later than 28 days in advance of termination, the
Debtors will send advance notice by first class United States
Mail of any termination of retiree benefits to covered retirees.
These notices will include, at a minimum, information regarding
conversion rights, if any, under any group insurance policies,
and the Debtors will take no action to impair, abridge or
eliminate any existing conversion rights under these insurance
policies. If through the delay of the Debtors the notices are
not mailed timely, the termination date will extend to March 31,
2002.
(4) The Debtors will provide the Official Committee,
through its designates, a form notice of termination to retirees
represented by the Official Committee, and the Committee will
have the right to review and comment on the notice within 1
business day, and the Debtors agree to "consider" these
comments.
(5) The Debtors will provide the Official Committee
with a computer disk containing retirees' names and addresses
for use by retirees or their designates in the event legacy or
other benefits become available. The Official Committee agrees
to reasonable privacy and security provisions, as may be
proposed by the Debtors, on the use of the information provided
in the computer disk.
(6) The Debtors and the Official Committee agree to
cooperate on alternative means of communication to covered
retirees of rights and benefits as may reasonably be agreed
upon. This does not "impose upon the Debtors any obligation to
assign or commit personnel to perform these functions". (LTV
Bankruptcy News, Issue No. 24; Bankruptcy Creditors' Service,
Inc., 609/392-00900)
LOEWS CINEPLEX: Asks Court for More Time to Decide on Leases
------------------------------------------------------------
In light of the pressing need to focus on the confirmation of
the Plan and to prevent them from being compelled to make
premature decisions with respect to the Leases, Loews Cineplex
Entertainment Corporation with its Debtor-Affiliates asks the
U.S. Bankruptcy Court for the Southern District of New York to
extend the time within which they must elect to assume, assume
and assign, or reject each of their unexpired leases of
nonresidential real property. The Debtors wish to move their
Lease Decision Period from February 12, 2002 through the date of
confirmation of the Debtor's chapter 11 plan.
The Debtors remind the Court that the unexpired leases of which
the Debtors are parties to, are the main component of the
Debtor's theatre business. The Debtors are continually analyzing
their entire theatre portfolio to determine which Leases should
be assumed, and which should be rejected. Such determination
requires the Debtors to work the legal and economic issues of
each Lease.
Loews Cineplex Entertainment Corporation is a major motion
picture theatre exhibition company with operations in North
America and Europe. The Company filed for chapter 11 protection
on February 15, 2001. Brad Eric Scheler, Esq., Janice MacAvoy,
Esq. at Fried, Frank, Harris, Shriver & Jacobson represents the
Debtors in their restructuring effort.
DebtTraders reports that Loews Cineplex Entertainment's 8.875%
bonds due 2008 (LOEWS1) are trading between 9 and 12. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=LOEWS1for
real-time bond pricing.
MARINER POST-ACUTE: Sale of Merrimack Facility to Amesbury OK'd
---------------------------------------------------------------
Mariner Health Group, Inc. (MHG), its wholly owned subsidiary
Merrimack Valley Nursing & Rehabilitation Center, Inc. and the
other MHG debtors sought and obtained authority to sell the
"Mariner Health of Merrimack Valley" skilled nursing facility to
Amesbury Realty Trust and Amesbury Village, LLC for
approximately $1,670,000 in cash. After adjustments and
prorations are made, Merrimack estimates that its net proceeds
will be approximately $1,200,000.
Specifically, the MHG Debtors have sought and obtained:
(1) approval of the Asset Purchase Agreement, dated as of
October 17, 2001, and the First Amendment to Asset Purchase
Agreement, dated as of January 2, 2002 (collectively, the
Purchase Agreement), by and between Amesbury (the Buyer) and
Merrimack as seller, with respect to the sale;
(2) authority to sell the Facility and its related assets
free and clear of liens, claims, encumbrances, and other
interests;
(3) approval of the brokers agreement by and between Merrimack
and Healthcare Transactions Group, Inc. (HTG);
(4) authority for the assumption and assignment to Buyer of the
Medicare Provider Agreement (Medicare provider number 22-
5318) between Merrimack and the Centers for Medicare and
Medicaid Services f/k/a the Health Care Financing
Administration (CMS) relating to the Facility;
(5) authorization of the rejection of certain executory
contracts related to the Facility.
The Facility is a 124-bed licensed skilled nursing facility,
located at 25 Maple Street, Amesbury, Massachusetts 01913-1398.
It is owned and operated by Merrimack at the time of the
transaction.
For the fiscal years ended September 30, 2000 and September 30,
2001, the Facility generated earnings before interest, taxes,
depreciation, and amortization (EBITDA) of $413,116 and
$289,590, respectively. Although the Facility has historically
been profitable, it has consistently underperfomed based upon
the Debtors' budgeted EBITDA. The Debtors believe that the
underperformance may be attributable to the Facility's location
and the state of plant relative to competitors in the area. The
Facility is located in an area that is difficult to reach during
poor weather. Further, the Facility is in need of significant
capital improvements that the Debtors believe would cost over
$200,000.
Because the Facility is over 40 miles from any other of the
Debtors' skilled nursing facilities, which makes it difficult
for the Debtors to service in a cost-effective manner, it is not
considered by the Debtors as a strategic component of their real
estate portfolio.
In exercising their business judgment, the Debtors determined
that a sale of the Facility was appropriate, considering the
Facility's historic underperformance, its location and the fact
that the Facility is not strategic to the Debtors' real estate
portfolio.
The Debtors tell Judge Walrath that they have marketed the
Facility since early 2001 under non-exclusive agreements with
various brokers but the only offer was that from the Buyer. The
Debtors believe this is a fair and reasonable offer for the
Facility and it is in the best interest of the Estate to take
the offer and sell the Facility to the Buyer.
The Purchase Agreement
Pursuant to the Purchase Agreement, Merrimack agrees to sell and
assign to the Buyer all of Merrimack's right, title, and
interest in and to the Assets which include:
(a) The Prepaids, consisting of all prepaid expenses, not to
exceed $10,000 in the aggregate, including, without
limitation, prepaid deposits with respect to licenses,
suppliers, and utilities;
(b) The Inventory located at the Facility;
(c) The Real Property consisting of the Facility;
(d) The Other Assets, including all tangible personal property
and equipment located at, and held by Merrimack, exclusively
for use at the Facility;
(e) The Permits, to the extent transferable, used exclusively in
the operation of the Facility;
(f) The Intellectual Property Rights, including all trademarks
and trade name associated with the Facility, excluding any
right to use the name "Mariner Post-Acute Network," "Mariner
Health Group," or any derivation thereof; and
(g) The going concern of the business conducted at the Facility.
The Purchase Agreement provides that, in exchange for the
Assets, the Buyer shall pay to Merrimack approximately
$1,670,000 in cash, subject to certain adjustments and
prorations (the Purchase Price"). The Purchase Agreement further
provides that Merrimack will pay Buyer $75,000 at Closing in
settlement of any potential Medicaid claims that may be asserted
by a Governmental Authority against the Facility or the Buyer
with respect to any Medicaid reimbursement made during the
period prior to the Closing Date (the Medicaid Claims Payment).
The Buyer has escrowed a $50,000 deposit which is non-refundable
so long as Merrimack's senior secured prepetition lenders
consent to the Sale and the Sale is approved by this Court.
Medicare Provider Agreement
Specifically, Merrimack will assume conditioned upon assignment
the Medicare Provider Agreement and provider number applicable
to the Facility and assign it to the Buyer after the Buyer
obtains CMS approval of the change of ownership, provided that
any claim of Medicare, the applicable fiscal intermediary, the
Department of Health and Human Services (HHS), or any other
party against the Debtors under the Medicare Provider Agreement
arising prior to the Petition Date will continue to be treated
as a prepetition claim with the same rights, status, and
priority as if such Medicare Provider Agreement had been
rejected, so that such claims will not become or be treated as
administrative claims, and will not be offset against any of the
Debtors' claims arising after the Petition Date. Instead, CMS
will be allowed to offset all such claims (to the extent valid,
and without prejudice to the Debtor's right to dispute such
claim) against any prepetition underpayment claim of the Debtors
against Medicare, even if the claim and debt are not "mutual,"
as ordinarily required by 11 U.S.C. Sec. 553, and without
further order of the Court. To the extent CMS's claim is not
satisfied in full via exercise of the offset right, the United
States shall have an administrative expense claim pursuant to 11
U.S.C. Sec. 507(b) for any such deficiency against Merrimack's
estate, which claim shall be capped at $50,000 with respect to
the Facility. The rights accorded the United States under the
Approval Order will constitute "cure" under 11 U.S.C. Sec. 365
so that the Buyer will not have successor liability for any
claim against any Debtors under the Medicare Provider Agreement
arising prior to the effective date of the assignment of such
Medicare Provider Agreement to the Buyer.
The Buyer will succeed to the quality of care history of
Merrimack as to the Facility, except that the assignee shall not
be liable to pay any civil monetary penalty accruing prior to
the Closing Date.
The Service Contracts
Because Merrimack agrees to sell all of the Assets associated
with the Facility and thereafter cease doing business at the
Facility, the service contracts related to the Facility will be
unnecessary and burdensome to Merrimack's estate upon the
Closing of the Sale. Accordingly, Merrimack and the Buyer have
agreed that Merrimack is not and will not be obligated to assume
or assign to the Buyer the Service Contracts, and that the
Service Contracts will instead be deemed rejected effective as
of the Closing Date.
The Debtors submit that the proposed transaction is the product
of arms' length, good faith negotiations between the Buyer and
Merrimack.
The Broker Agreement
As part of their efforts to sell the Facility, the Debtors
engaged numerous brokers under non-exclusive license agreements
to market the Facility. Included among the brokers that the
Debtors engaged was HTG, which the Debtors engaged on the terms
and conditions contained in the Brokers Agreement.
Pursuant to the Brokers Agreement with HTG, Merrimack is
obligated to pay HTG 4% percent of the total purchase price for
the Facility, for HTG's identification and introduction of the
Buyer to Merrimack (the Brokers Fee). The Debtors believe that
the Brokers Fee will be between $64,000 and $90,000. (Mariner
Bankruptcy News, Issue No. 25; Bankruptcy Creditors' Service,
Inc., 609/392-0900)
MAXXAM INC: Defers Q4 Financial Results Announcement
----------------------------------------------------
MAXXAM Inc. (AMEX:MXM) is deferring the release of its fourth-
quarter financial results. The previously scheduled date was
January 31.
MAXXAM is taking this step as a result of the decision of Kaiser
Aluminum Corporation (NYSE:KLU) to defer its fourth-quarter
earnings announcement, and not make the $25.5 million interest
payment on its 12-3/4% Senior Subordinated Notes scheduled for
February 1, 2002. Kaiser Aluminum also announced that it is
considering restructuring alternatives that could result in the
non-payment of principal and interest due February 15 on Kaiser
Aluminum's 9-7/8% Senior Notes due 2002 and interest due April
15 on Kaiser Aluminum's 10-7/8% Senior Notes due 2006.
(Additional detail on Kaiser Aluminum's announcement can be
found in a press release issued this afternoon by Kaiser
Aluminum.)
MAXXAM expects to issue its fourth-quarter financial results at
about the time Kaiser Aluminum issues its earnings results. A
new date has yet to be set by Kaiser Aluminum.
MAXXAM directly and indirectly holds approximately 62 percent of
Kaiser Aluminum.
MCLEODUSA INC: Wins Nod to Continue Using Existing Bank Accounts
----------------------------------------------------------------
McLeodUSA Inc. seeks a waiver on the United States Trustee's
requirement for closing bank accounts and opening new
postpetition bank accounts.
To supervise administration of Chapter 11 cases, the Office of
the United States Trustee requires all debtors-in-possession to:
(i) close all existing bank accounts and open new debtor-in-
possession bank accounts;
(ii) establish one debtor-in-possession account for all estate
monies required for the payment of taxes, including
payroll taxes;
(iii) maintain a separate debtor-in-possession account for
cash collateral; and
(iv) obtain checks for all debtor-in-possession accounts which
bear the designation "Debtor In Possession," the
bankruptcy case number and the type of accounts.
Randall Rings, the Debtor's Group Vice President, Secretary and
General Counsel, says the requirements would cause enormous
disruption in McLeodUSA's business, thus impairing efforts to
reorganize and pursue other alternatives to maximize the value
of its estate.
Mr. Rings says the Debtor completes thousands of transactions
each month through its existing bank accounts, including
transactions with respect to the Non-Debtor Affiliates'
receivables and payables. The Debtor believes that all of the
bank accounts, whether located within or outside the District of
Delaware, are held at financially-stable banking institutions
with FDIC insurance or other appropriate government-guaranteed
deposit protection insurance.
The Debtor's bank accounts are the basis of the cash management
system and what ensures smooth collections and disbursements in
the ordinary course.
The Debtor is part of a group of more than 30 related entities
located throughout the United States. The Debtor's main
concentration and disbursement bank accounts act as the
centralized system for collecting receivables and making
payments, including the collection of the Non-Debtor Affiliates'
receivables and payables. Many of these entities have
receivables owing from, and payables owing to, one another,
including the Debtor. These intercompany claims periodically are
settled through a nationwide system of accounts of which the
bank accounts are a subset.
Mr. Rings says that in order to avoid delays in payments to
administrative creditors, to ensure as smooth a transition into
Chapter 11 as possible with minimal disruption, including, but
not limited to, disruptions to the Non-Debtor Affiliate's
business operations if the Debtor were foreclosed from
continuing to collect the Non-Debtor Affiliate's receivables and
paying the Non-Debtor Affiliate's payables, it is important that
the Debtor be permitted to maintain its existing Bank Accounts.
Anticipating an emergence from Chapter 11 within a very short
time-period, Mr. Rings says it makes little economic sense
closing all its bank accounts and reopening them as new post-
petition accounts, or creating a cash management system which
separates cash from the Debtor from the Non-Debtor Affiliates.
Judge Katz grants the Debtor's Motion in all respects, directing
that the Bank Accounts be deemed debtor-in-possession accounts.
(McLeodUSA Bankruptcy News, Issue No. 2; Bankruptcy Creditors'
Service, Inc., 609/392-0900)
METALDYNE: S&P Revises Low-B Rating Outlook to Negative
-------------------------------------------------------
Standard & Poor's revised its outlook on Metaldyne Corp. to
negative from stable. At the same time, Standard & Poor's
affirmed its ratings.
The outlook revision reflects Metaldyne's weaker-than-expected
operating results and higher-than-expected debt use in the past
few quarters, which have resulted in subpar credit protection
measures. The rating affirmations reflect an expectation that
operating performance will gradually improve and help the
company bring debt to EBITDA down to the 4.0 times to 4.5x range
from the current 5.6x level (adjusted for operating leases and
accounts receivable sales).
The ratings on Metaldyne reflect the company's aggressive
financial profile, offset to some extent by its diversified
product portfolio, good engineering capabilities, and
concentration on value-added specialty products. Metaldyne
represents a combination of the former operations of MascoTech
Inc., Simpson Industries Inc., and Global Metal Technologies
Inc.
Metaldyne generates about $2.1 billion in annual revenues and is
a leading independent supplier of cold-, warm-, and hot-formed
metal-worked products for original equipment automotive
manufacturers. The company also produces towing systems,
specialty container products, specialty fasteners, and other
industrial products. Metaldyne benefits from significant
product, end-market, and customer diversity, all of which help
mitigate the risks associated with the competitive and cyclical
markets in which the company competes.
Offsetting the company's strengths is its aggressive financial
profile. Debt to EBITDA (adjusted for accounts receivable sales
and operating leases) is currently estimated to be about 5.6x.
Metaldyne's operating performance is currently under some
pressure due to the slowdown in the North American automotive
market. Current ratings are based on the assumption that the
increasing sales of higher value-added products, new product
introductions, and ongoing cost-saving efforts will help
Metaldyne mitigate industry pressures to some extent and lead to
a gradual improvement in financial measures, with debt to EBITDA
improving to the 4.0x-4.5x range over the near to intermediate
term. Although Metaldyne is expected to pursue acquisition
opportunities from time to time, it is expected to finance them
in such a way as to maintain credit protection measures within
the expected range.
Outlook: Negative
Should Metaldyne fail to generate the expected improvement in
credit protection measures, or should growth initiatives lead to
a diminution in financial flexibility, the ratings could be
lowered.
Ratings Affirmed
Metaldyne Corp.
Corporate credit rating BB-
Subordinated debt B
Senior secured bank loan BB-
METALS USA: Look for Schedules & Statements Around March 8
----------------------------------------------------------
Metals USA, Inc., and its debtor-affiliates ask the Court to
further extend the deadline by which they must file their
Schedules of Assets and Liabilities and Statements of Financial
Affairs. The Debtors tell the Court that they anticipate having
those documents ready for filing on March 8, 2002.
Zack A. Clement, Esq., at Fulbright and Jaworski LLP in Houston,
Texas, says that the Debtors have attempted to comply with the
U.S. Trustee's requirement that they file 44 separate sets of
Schedules and Statements. Management, however, has been focused
throughout the first few months of these Chapter 11 cases on
dealing with the Bank Group on matters including litigation on
cash collateral use, as well as negotiations for DIP financing.
Mr. Clement submits that to prepare the Schedules and
Statements, the Debtors must gather information from books,
records and document on thousands of transactions which require
substantial time and effort by the Debtors' employees and
outside professionals. Although the employees have been
mobilized to work diligently preparing the Schedules and
Statements, the Debtors nonetheless must compile financial and
operational information from 44 companies with $600,000,000 in
debt, a sizeable task under any circumstances and made more
difficult by the need to stabilize the Debtors' business
relationships and workforce in the wake of these Chapter 11
filings.
A hearing is to be held on February 20, 2002 to consider this
motion. (Metals USA Bankruptcy News, Issue No. 7; Bankruptcy
Creditors' Service, Inc., 609/392-0900)
METRIS COMPANIES: Fitch Affirms BB+ Rating on Bank Facility
-----------------------------------------------------------
Fitch Ratings affirms Metris Companies Inc. secured bank credit
facility at 'BB+' and senior debt at 'BB'. In addition, the
long-term deposit rating for Metris' wholly-owned banking
subsidiary, Direct Merchants Credit Card Bank N.A. (DMCCB) is
also affirmed at 'BB+'. The Rating Outlook has been revised to
Negative from Stable.
Fitch's ratings and affirmation continue to reflect the
company's established niche in the credit card sector, adequate
capitalization for the assigned rating and sustained
profitability. To date, Metris continues to grow its managed
credit card portfolio, which stands at $11.9 billion at year end
2001, through both internal and external account originations.
The company's capital structure is appropriate for the assigned
rating and is augmented by the company's $393 million Series C
preferred stock. Metris continues to be profitable, despite
higher reserving due to increased credit losses.
Fitch's ratings also incorporate Metris' focus on the low and
moderate income segment of the consumer credit market, where
loss and delinquency rates are higher and less predictable.
Fitch also recognizes Metris' more limited funding profile
relative to traditional banking peers, as the company is more
reliant on asset backed funding. Moreover, Fitch remains mindful
of the heightened regulatory scrutiny placed on consumer lending
practices and Metris will need to proactively manage its
business and marketing activities to remain in compliance with
new and emerging regulatory guidance.
Fitch's Negative Outlook reflects the view that Metris will be
challenged to manage credit quality and profitability throughout
2002. Metris has announced that its forecasted loss rate in 2002
will range between 12.7%-13.3% of average managed receivables,
up from 11% during 2001. While some of this forecasted increase
reflects a change in charge-off policy for accounts in consumer
credit counseling and slower expected receivable growth, Fitch
believes that given the uncertain economic environment, credit
losses could exceed forecasted ranges which could impact
profitability, if not offset through cost reductions.
Metris Companies Inc., is a Minnesota-based marketer of consumer
credit cards and related enhancement products. At December 31,
2001, the company reported $11.9 billion of managed loans, and
$1.1 billion of common and preferred equity.
NORTHERN NATURAL: S&P Taking Harder Look At Pipeline's Ratings
--------------------------------------------------------------
Standard & Poor's changed its CreditWatch listing on its ratings
of Northern Natural Gas Co. and Transwestern Pipeline Co. to
developing from negative implications. The CreditWatch change
reflects the fact that neither company has been included in the
Enron bankruptcy and the possibility that they will not
ultimately be drawn into the bankruptcy proceedings. In
addition, for NNG, the change reflects Dynegy Inc.'s
announcement regarding its assumption of ownership of NNG from
Enron Corp.
However, there is some uncertainty surrounding the ultimate
credit quality of the company due to Enron's repurchase option,
which expires on June 30, 2002. As a result, the ratings at
Northern Natural Gas will remain on CreditWatch until the option
expires. At that point, if the option expires, Standard & Poor's
expects the ratings of Northern Natural Gas to be consistent
with Dynegy's corporate credit rating.
The double-'C' ratings on NNG and Transwestern reflect the
uncertainty of whether the pipeline companies would be drawn
into the bankruptcy proceeding of the parent company, Enron.
Once Standard & Poor's determines that they are not likely to
become a part of the Enron bankruptcy, the ratings will be
changed to incorporate each company's stand-alone credit
profile. For NNG, if ownership is assumed by Dynegy, its rating
will reflect Dynegy's credit quality.
The ratings for Dynegy and its subsidiaries remain on
CreditWatch with negative implications. This reflects the
uncertainty surrounding the pending lawsuit filed by Enron that
alleges that Dynegy falsely executed its right to terminate the
merger agreement. Standard & Poor's cannot at this time
determine the outcome of such litigation. Also, in light of
certain events related to the energy trading and marketing
industry, Standard & Poor's is examining general counterparty
confidence and liquidity issues.
Ratings Placed on CreditWatch Developing
Northern Natural Gas Co.
Corporate credit rating CC
Senior unsecured debt CC
Transwestern Pipeline Co.
Corporate credit rating CC
NORTHLAND CRANBERRIES: Net Revenues Drop 39% to $125.8MM in 2001
----------------------------------------------------------------
During fiscal 2001, Northland Cranberries, Inc. continued to
experience substantial difficulty generating sufficient cash
flow to meet obligations on a timely basis. The Company failed
to make certain scheduled monthly interest payments under its
revolving credit facility, and were not in compliance with
several provisions of its former revolving credit agreement and
other long-term debt agreements as of the end of the fiscal
year. It was often delinquent on various payments to third party
trade creditors and others. The industry-wide cranberry
oversupply continued to negatively affect cranberry prices.
Continued heavy price and promotional discounting by Ocean Spray
and other regional branded competitors throughout fiscal 2001,
combined with Northland's inability to fund a meaningful
marketing campaign, resulted in lost distribution and decreased
market share of its products in various markets. The Company had
reached the maximum in its line of credit and was not able to
obtain any additional financing. As a result of these and other
factors, Northland incurred a large net loss for fiscal 2001.
Some of these other factors included:
-- An oversupply of cranberries resulting from three
consecutive nationwide bumper crops culminating with the 1999
harvest, followed by what Northland believes was an inadequate
volume regulation under the USDA cranberry marketing order for
the 2000 crop year, resulted in continued large levels of excess
cranberry inventories held by it and other industry
participants. As a result, the per barrel price for cranberries
continued to decline through the first quarter of fiscal 2001
and, while the per barrel price has subsequently increased, it
has not recovered to the extent anticipated. As a result of
these factors, Northland's cost to grow the fall 2001 crop and
the cost of on-hand inventories, including costs to be incurred,
were in excess of market value, and the Company determined that
it was necessary to write down the carrying value of its
cranberry inventory by approximately $17.6 million in the fourth
quarter of fiscal 2001.
-- Northland sold its private label sauce business and a
related manufacturing facility to Clement Pappas in June 2001 in
a cash transaction. Its private label sauce business and co-
packing sold from the facility generated net revenues of
approximately $7.8 million, $14.1 million and $9.0 million in
fiscal 2001, 2000 and 1999, respectively.
-- In the fourth quarter of fiscal 2001, as a result of the
deterioration in the long-term prospects for the cranberry
growing and processing industry over the summer due, in part, to
the implementation of what Northland believes was another
inadequate volume regulation under a USDA cranberry marketing
order for the 2001 calendar year crop, continued large levels of
excess cranberry inventories held by the Company and other
industry participants, forecasted future cranberry market prices
for the next several years, as well as continued reductions in
anticipated cranberry and cranberry concentrate usage
requirements related to the Company's recent decline in revenues
and market share, it decided to restructure operations and
identify various long-lived assets to be disposed of, and
concluded that the estimated future cash flows of long-lived
assets were below the carrying value of such assets.
Accordingly, during the quarter, the Company recorded an
impairment charge of approximately $80.1 million related to
writedowns to assets held for sale, property and equipment held
for use, and goodwill and other intangible assets in accordance
with Statement of Financial Accounting Standards.
Although Northland was successful in retaining distribution in
many markets, the lack of sufficient working capital limited its
ability to promote its products. The Company indicates that it
had reached the point where it felt it was imperative to reach
an agreement with its then-current bank group and to refinance
its bank debt, or else it believed it was faced with liquidating
or reorganizing the company in a bankruptcy proceeding in which
creditors would have likely received substantially less value
than it was felt they could receive in a restructuring
transaction and shareholders would have likely been left
holding shares with no value.
Northland's total net revenues decreased 39.2% to $125.8 million
in fiscal 2001 from $207.0 million in fiscal 2000. The decrease
resulted primarily from (i) reduced sales of Northland and
Seneca branded products, which the Company believes resulted
primarily from its change in promotional and pricing strategies
and reduced marketing spending; (ii) reduced co-packing revenue
from a major customer that during the first quarter of fiscal
2001 switched from an arrangement where Northland purchased
substantially all of the ingredients and sold the customer
finished product to a fee for services performed arrangement;
(iii) the sale of its private label juice business in March
2000; and (iv) the sale of its cranberry sauce business and a
manufacturing facility in June 2001, which reduced co-packing
revenue and revenue from cranberry sauce sales. Trade spending,
slotting and consumer coupons, which is reported as a reduction
of net revenues instead of as a selling, general and
administrative expense was down 72.0% to $16.6 million in fiscal
2001 from $59.2 million in fiscal 2000.
Cost of sales for fiscal 2001 was $115.5 million compared to
$253.4 million in fiscal 2000, resulting in gross margins of
8.2% and (22.4)%, respectively. The decrease in cost of sales
resulted primarily from reduced sales of Northland and Seneca
branded products, the elimination of costs associated with
production of private label juice products and reduced costs for
reduced sauce and co-packing revenues. Additionally, the
decrease resulted from the change during the first quarter of
fiscal 2001 in the arrangement with a significant co-packing
customer from an arrangement where the Company purchased
substantially all of the ingredients and sold the customer
finished product to a fee for services performed arrangement.
The improved margins in fiscal 2001 were also favorably impacted
by improved manufacturing efficiencies and cost controls.
ONSITE ACCESS: Committee Okays Solicitation Period Extension
------------------------------------------------------------
The Official Committee of Unsecured Creditors in the chapter 11
cases of Onsite Access, Inc., and its debtor-affiliates agree
that the Debtors' exclusive period for soliciting acceptances of
its liquidating chapter 11 Plan will be extended through April
30, 2002.
Onsite Access, Inc., intends to complete the wind down of their
businesses and to distribute the net proceeds from the sale of
their assets, as well as any liquidation proceeds to creditors
according to the terms of a consolidated Chapter 11 plan of
liquidation.
Committee Counsel has reviewed the Plan and requested certain
additional information from the Debtors relating to the proposed
treatment of certain classes of claims and interests as well as
several other issues. The Debtors will be filing an amended
plan and disclosure statement, incorporating the comments of the
Committee and other parties-in-interest and seek approval of the
amended Disclosure Statement.
OnSite Access, Inc., a broadband telecommunications network
provider of data, voice and enhanced services to small and
medium-sized businesses, sought chapter 11 protection on May 16,
2001 in the U.S. Bankruptcy Court for the Southern District of
New York. Frank A. Oswald, Esq., at Togut Segal & Segal LLP, in
New York, New York, represents the firm in its reorganization
efforts.
ORIUS CORP: Fitch Slashes NATG Senior Subordinated Notes to D
-------------------------------------------------------------
Fitch Ratings downgraded the rating of NATG Holdings, LLC's
(NATG) $150 million 12.75% senior subordinated notes to 'D' from
'CC' and removes the notes from Rating Watch Negative.
NATG is a wholly owned subsidiary of Orius Corporation and is
the issuer of the notes. As per the 8-K filing made by Orius on
January 18, 2002, the company's senior secured lenders have
blocked payment of interest on the Notes, and as a result, no
interest was paid on the February 2, 2002 interest payment due
date.
Orius is a holding company, headquartered in West Palm Beach,
FL, with operating subsidiaries engaged in the provision of
telecommunications and broadband network infrastructure on a
national basis. Services include the design, engineering, and
installation of central office telecom equipment, premise-
wiring, and cable. Willis Stein and Partners, a private equity
investor, is the company's majority owner.
PACIFIC GAS: DebtHolders Reserve Rights Re Tri-Party Agreement
--------------------------------------------------------------
Certain Debtholders submit their reservation of rights in
response to the Joint Motion of Pacific Gas and Electric
Company, and the Bank of New York as Indenture Trustee for an
Order pursuant to Sections 105(a) and 363 of the Bankruptcy
Code, authorizing, (i) Debtor to enter into Tri-Party Agreement,
and (ii) Appointment of Wilmington Trust Company as successor
trustee.
The Debtholders are holders of inter alia Floating Rate Notes,
Senior Notes, Medium Term Notes, Commercial Paper and other
claims totaling in excess of $2 billion against the Debtor, thus
representing a significant portion of the unsecured creditors in
the PG&E bankruptcy case. Specifically, the entities include:
State Teachers Retirement System of Ohio, the Washington DC
Water and Sewer Authority, Chandler Asset Management, Franklin
Mutual Advisers, LLC, King Street Capital, M.H. Davidson & Co.,
L.L.C., OZF Management L.P., Pacific Investment Company LLC,
Satellite Asset Management L.P., Security Benefit Life Insurance
Co., Stark Investments, Angelo Gordon & Co., and Appaloosa
Management LP.
The Debtholders tell Judge Montali that over $1 billion of the
claims held by the Debtholders were issued pursuant to the terms
of the indenture between The Bank of New York as indenture
trustee and the Debtor. With respect to certain series of the
securities issued under the Indenture, the Debtholders represent
over a majority in principal amount of such series.
The Debtholders indicate that while they recognize the need for
the Indenture Trustee to resign and support the payment by the
Debtor of the fees and expenses of the Resigning Trustee and
Successor Trustee, they submit their reservation of rights as
follows:
(1) Right to remove Trustee under Section 610(c) of the
Indenture
The Debtholders reserve all of their rights under the
Indenture including Section 610(c) under which the trustee
may be removed at any time with respect to the Securities of
any series by Act of the Holders, as defined in the
Indenture, of a majority in principal amount of the
outstanding Securities of such series delivered to the
Trustee and to the Company, the Debtor.
While the Debtholders know of no reason at this time why
Wilmington Trust Company should not be approved as the
Successor Trustee, the Debtholders make it clear that the
lack of objection should not be deemed a waiver of any
rights of the Debtholders under Section 610(c) should
circumstances change in the future.
(2) Reasonable Fees and Expenses
Section 607 of the Indenture provides for compensation and
reimbursement of the Trustee as "reasonable" fees and
expenses.
The Debtholders note that Section 403 of the Tri-Party
Agreement makes reference as to "all outstanding fees and
expenses."
Pursuant to the terms of Sections 901 and 902 of the
Indenture, although supplemental indentures without the
consent of the Holders are appropriate to evidence
succession, they are not authorized to change any of the
substantive rights of the Holders.
The Debtholders assume that the requirement of
reasonableness is to be read into Section 403 of the Tri-
Party Agreement. The Debtholders make it clear that they are
not implying that the fees would be unreasonable but if the
purpose of Section 403 is to modify the terms of the
Indenture with respect to the standard for reimbursable fees
and expenses of the Trustee, then the Debtholders reserve
their rights to assert that such amendment is ineffective.
(3) The Debtor's Obligation To Pay Trustee's Fees
The Summary Claims Table that appears in the First Amended
Disclosure Statement for the First Amended Plan of
Reorganization sets forth the estimated percentage of
recovery for the Class 5 Claims, including Securities issued
under the Indenture, as 100%.
The Debtholders tell Judge Montali that the language in
Section 403 of the Tri-Party Agreement providing for
consideration to be applied first to the payment of fees and
expenses under the Indenture is inconsistent with the
estimated recovery as set forth in the Amended Disclosure
Statement.
The Debtholders strongly support the payment of the fees and
expenses of the Resigning Trustee and Successor Trustee by
the Debtor in this case. Given the facts and circumstances
of this case, including the Debtor's solvent status, the
Debtholders believe that the fees and expenses of such
Trustees must be paid by the Debtor rather than borne by the
Holders.
The Debtors make it a point that the entry of the Order
accompanying the Motion should not be deemed an agreement by
the Debtholders that the Securities will be paid in full if
the consideration received for the Securities can be
diminished by exercise of the Trustee's "latch on rights"
under the Indenture. The Debtholders do not waive their
position that the plan of reorganization in this case must
separately deal with the claims of the Trustee in a manner
that will satisfy those claims in full by payment from the
Debtor and obviate the need to exercise any latch on rights.
The Debtholders assert that, under Section 607 of the
Indenture, the Debtor covenanted to pay the reasonable fees
and expenses of the Trustee. The Debtholders reserve the
right to assert that any plan by this solvent Debtor in
which the fees and expenses of the Trustee are not paid
separately from the claims of the holders of the Securities
is not payment in full of such Securities, with all the
attendant ramifications for junior classes.
(4) Proper Treatment Under Plan
The Debtholders remind Judge Montali that, under Section
316(b) of the Trust Indenture Act, the right of any holder
of any indenture security to receive payment of the
principal of and interest on such security shall not be
impaired or affected without the consent of such holder.
Under Section 504 of the Indenture, only the Holders of the
Securities, and not the Trustee, can vote on a plan of
reorganization. Accordingly, only the Holders can approve
their treatment under a plan.
The Debtholders reserve all their rights with respect to the
proper treatment of the Securities under any plan of
reorganization in this case.
(5) Suggested Language in Order
The Debtholders suggest that the proposed order should be
modified to contain the following language:
"Nothing contained herein shall be deemed to (a)
diminish the rights of any holders of securities issued
under the Indenture, (b) waive the right of any holder of
securities issued under the Indenture to be paid in full
under applicable law or (c) dictate the provisions of or
be an agreement by any creditor as to the terms of a plan
of reorganization regarding the securities issued under
the Indenture." (Pacific Gas Bankruptcy News, Issue No.
21; Bankruptcy Creditors' Service, Inc., 609/392-0900)
PINNACLE HOLDINGS: Amends & Extends Facility Forbearance Pact
-------------------------------------------------------------
Pinnacle Holdings Inc. (Nasdaq: BIGT) announced that the
previously announced amended forbearance agreement that it and
its subsidiaries, including Pinnacle Towers Inc., entered into
on November 16, 2001 and amended on December 12, 2001 with the
lenders under their senior credit facility has been extended to
March 8, 2002, during which period the lenders agree not to
exercise remedies available to them as a result of Pinnacle's
non-compliance with certain covenants under its senior credit
facility as of September 30, 2001.
The prior forbearance agreement entered into eliminated Pinnacle
Tower's ability to make additional draws under the senior credit
facility; increased the interest rate on outstanding borrowings
under the facility; restricted the amount of money that can be
invested in capital expenditures by Pinnacle Towers; and limited
Pinnacle Tower's ability to incur additional debt.
The newest extension of the forbearance agreement also expressly
limits Pinnacle Tower's current ability to distribute funds to
Pinnacle Holdings in connection with Pinnacle Holdings 5.5%
Convertible Subordinated Notes. Pinnacle Towers believes it has
adequate financial resources to fund its current operating
expenses and fund the upcoming interest payment on Pinnacle
Holding's Convertible Notes on March 15, 2002 to bondholders as
of March 1, 2002. However, as a result of the current
agreements with the senior lenders, which as noted above
preclude Pinnacle Towers from distributing funds to Pinnacle
Holdings, Pinnacle Holdings will not have sufficient funds to
make such interest payment. If such payment is not made within
30 days of when due, then, subject to the terms of the governing
indenture, the holders of 25% in principal amount of the
Convertible Note may be able to declare the $200 million
principal amount of the Convertible Notes, together with accrued
and unpaid interest, immediately due and payable.
If the Convertible Note holders or, upon expiration of the
forbearance agreement, the bank lenders, were to accelerate the
maturity of amounts due under the Convertible Notes or Pinnacle
Tower's credit facility, respectively, Pinnacle's 10% Senior
Discount Notes due 2008, may subsequently become payable. If
any of such debt becomes payable, Pinnacle Holdings and Pinnacle
Towers would not have sufficient funds to immediately repay the
indebtedness of theirs that is so payable, and one or both of
them could have to seek to restructure its indebtedness under
Chapter 11 of the Bankruptcy Code.
Pinnacle Towers currently believes that it will need to make
further progress towards deleveraging its capital structure in
order to obtain additional forbearance extensions it will likely
need. Pinnacle Holdings believes it will likely have to attract
additional capital in order to be able to amend the senior
credit agreement so that Pinnacle Towers will no longer be out
of compliance with its terms. Pinnacle Holdings has been
actively seeking additional capital and considering ways to
deleverage its capital structure with the assistance of its
advisors.
As previously disclosed, and based on the feedback that Pinnacle
Holdings has received in response to its capital raising efforts
to date, raising additional capital at this time will likely not
be possible without significantly restructuring its existing
indebtedness. Such restructuring can take significant time to
negotiate and implement and may have to be implemented by means
of a reorganization under chapter 11 of the U.S. Bankruptcy
Code.
Any such debt restructuring may result in holders of Pinnacle
Holding's common stocks and Convertible Notes receiving de
minimus interests in Pinnacle Holdings, if any. There can be no
assurance that Pinnacle Tower's lenders will further extend
their forbearance agreement. Pinnacle Holdings is initiating
discussions with its bondholders to work collectively with it in
order to address its capital structure challenges.
Steve Day, Pinnacle's CEO said, "Notwithstanding our capital
structure issues, I am encouraged by the support we are
receiving from our senior lenders during this process. Pinnacle
Towers currently is generating adequate cash flow to timely pay
its suppliers and employees, pay the interest on its senior
credit facility and continue servicing its valued customers.
While we work on these capital structure issues, we continue to
stay focused on executing on the day-to-day operations of our
business, and believe doing so is in the best interests of all
of our stakeholders."
Settles Dispute with Tower Services Supplier
Pinnacle Towers also said that it recently resolved a
previously-announced dispute with a tower services supplier
whereby Pinnacle Towers agreed to pay the supplier $2.0 million
for termination of a services contract between them. The amount
was accrued by Pinnacle Holdings as a charge to current
operations in the third quarter of fiscal year 2001. As a
result, $4.1 million of Pinnacle Tower's cash that Pinnacle
Towers had been temporarily unable to access was released to it.
In addition, as part of the settlement agreement, the supplier
agreed to pay Pinnacle Towers $2.0 million as full payment of
its obligations under a separate master lease agreement with
Pinnacle Towers.
Pinnacle is a leading provider of communication site rental
space in the United States and Canada. At December 31, 2001,
Pinnacle owned, managed, leased, or had rights to in excess of
4,400 sites. Pinnacle is headquartered in Sarasota, Florida. For
more information on Pinnacle visit its Web site at
http://www.pinnacletowers.com
SAFETY-KLEEN CORP: Seeks Open-Ended Removal Period Extension
------------------------------------------------------------
Safety-Kleen Corp., and its subsidiaries and affiliates ask
Judge Walsh to grant a further extension of the time period
within which the Debtors may remove proceedings pending as of
the commencement of these cases. Mark L. Desgrosseilliers,
Esq., at Skadden Arps Slate Meagher & Flom LLP, reminds Judge
Walsh that, as of the Petition Date, the Debtors were parties to
hundreds of civil actions pending in various jurisdictions
around the United States and involving a variety of claims,
including claims sounding in contract and tort, as well as
claims arising under federal, state, and/or local environmental
laws.
More specifically, the Debtors propose that the time by which
they may file notices of removal with respect to any pending
Actions be extended to the earlier to occur of (a) the date on
which a reorganization plan(s) is (are) confirmed in these
bankruptcy cases or (b) 30 days after entry of an order
terminating the automatic stay with respect to any particular
Action sought to be removed.
A further extension of the Removal Period is in the best
interests of the Debtors, their estates, their creditors and
other parties-in-interest. Since the commencement of these
chapter 11 cases, the Debtors' focus has been, first, on
stabilizing their businesses and, second, on formulation of a
comprehensive business plan for the future. Further, since entry
of the Order granting the presently expiring extension, and
notwithstanding the numerous difficult issues the Debtors
continue to face as they seek to reorganize, the Debtors have
been working tirelessly to resolve those matters whose
successful conclusion is a prerequisite to the Debtors' ability
to finalize the business plan, which, in turn, will form the
basis of a reorganization plan.
Because their focus properly has been on completion of the
restatement and the development of a business plan, the Debtors
have not yet been able to complete their analysis of the merits
of removing any, or each, of the hundreds of Actions to which
they are a party. The proposed extension of the Removal Period
will afford the Debtors the chance to make an informed decision
with respect to the benefits, if any, to be derived from removal
of some or all of the Actions.
A further extension of the Removal Period will not prejudice the
non-Debtor parties to the Actions. Each non-Debtor party to an
Action that ultimately is removed will continue to have the
right to seek remand under 28 U.S.C. 1452(b). Further, an
additional extension of the Removal Period will not unduly delay
the prosecution of the Actions, as most, if not all, of the
Actions remain subject to the automatic stay of section 362(a)
of the Bankruptcy Code. In short, a further extension of the
Removal Period simply will permit maintenance of the status quo
while the Debtors review, analyze, and consider their options
with respect to the Actions. (Safety-Kleen Bankruptcy News,
Issue No. 26; Bankruptcy Creditors' Service, Inc., 609/392-0900)
STOCKWALK GROUP: Will File Chapter 11 with Prepackaged Plan
-----------------------------------------------------------
Late Tuesday afternoon, February 5, 2002, the board of directors
of Stockwalk Group, Inc. (Nasdaq: STOK) unanimously approved the
filing of a petition for reorganization under Chapter 11 of the
U.S. Bankruptcy Code. Although some of the details of the
reorganization plan are still being ironed out, the essence of
the plan calls for full repayment of all the company's debts
over an extended period of time. This plan is endorsed by a
committee of the company's creditors. Upon confirmation of the
plan, the company would cease being a publicly-traded company.
Instead, it would be privately owned by members of management.
Following the vote approving the filing of a reorganization
petition, directors Louis Fornetti and Jan Breyer resigned from
the board, noting that their services would no longer be needed
in a court supervised reorganization. Directors Jack Feltl and
John Feltl resigned earlier in the day.
David Johnson, the company's chief executive officer, expressed
optimism over the company's future. "Under this reorganization
plan, our creditors should eventually be repaid, and the company
can continue to serve a vital investment banking role in this
community. Given the level of the company's debt, the
alternative likely would be liquidation. In that case, our
creditors would receive very little." Johnson anticipates the
reorganization petition and proposed plan will be filed with the
court within the next several days.
Based in Minneapolis, Minn., Stockwalk Group, Inc. is the parent
company of Miller Johnson Steichen Kinnard, Inc., a full-service
brokerage firm of 300 investment executives in six states; and
Stockwalk.com, Inc., an online trading company (AOL keyword:
Stockwalk). Stockwalk Group, Inc. common stock trades on the
Nasdaq Stock Market under the symbol STOK. Its broker dealer
subsidiaries are members of the National Association of
Securities Dealers (NASD) and the Securities Investor Protection
Corporation (SIPC). Miller Johnson Steichen Kinnard is a member
of the Chicago Stock Exchange.
For more information, visit http://www.stockwalkgroup.com or
contact mkyler@stockwalk.com
SUN HEALTHCARE: Secures Okay to Hire Bloom Borenstein as Counsel
----------------------------------------------------------------
Sun Healthcare Group, Inc., and its debtor-affiliates obtained
the Court's authority to employ and retain Bloom Borenstein &
Savage PC as special counsel to commence and prosecute certain
avoidance actions.
Bloom Borenstein is being retained as substituted counsel in
Avoidance Actions originally commenced by Gazes & Associates
LLP. It was explained that the representation of the Debtors by
Bloom Borenstein as special counsel is necessary because the
Debtors have determined that it is more cost effective to
prosecute all but certain of the largest of their avoidance
actions on a contingency fee basis. While Richards, Layton &
Finger has agreed to prosecute certain of the larger avoidance
actions at its ordinary hourly rate, Mr. Silberglied notes that
neither of the Debtors retained professionals - Richards, Layton
& Finger or Weil, Gotshal & Manges - has agreed to prosecute the
remaining avoidance actions on a contingency basis. Accordingly,
Mr. Silberglied says, the Debtors is retaining Bloom Borenstein
with respect to those remaining avoidance actions.
With the Court approval, the Debtors will look to Bloom
Borenstein to represent them as special counsel to commence and
prosecute certain avoidance actions that are not commenced by
Richards, Layton & Finger.
Subject to the Court's approval, Bloom Borenstein will be
compensated at and receive a contingency-based fee of 33-1/3% of
the gross settlement amounts (inclusive of interest and any
credits paid to defendants pursuant to and consistent with the
plan of reorganization, if any, filed by the Debtors) collected
from such defendants to pursue these avoidance actions. In
addition to this fee, it is the firm's policy to charge its
clients for disbursements and expenses incurred in the rendition
of services. According to Ms. Savage, these disbursements and
expenses include, among other things, costs for telephone and
facsimile charges, photocopying, travel, business meals,
computerized research, messenger, couriers, postage, witness
fees, and other fees related to trials and hearings.
At the time of the application, Bloom Borenstein, as related to
the Court, had no agreement with any other entity to share any
compensation received. However, Judge Walrath was informed that
Bloom Borenstein will be retaining local counsel and intends to
compensate such counsel from its fees awarded in this case
consistent with and pursuant to Rule 2016 of the Bankruptcy
Rules.
Furthermore, the Court was assured that the members and
associates of Bloom Borenstein:
(i) do not have any connection with the Debtors or their
affiliates, their creditors, or any other party-in-
interest, or their respective attorneys and accountants,
(ii) are "disinterested persons" as that term is defined in
section 101(14) of the Bankruptcy Code, and
(iii) do not hold or represent any interest adverse to the
estates. (Sun Healthcare Bankruptcy News, Issue No. 31;
Bankruptcy Creditors' Service, Inc., 609/392-0900)
TECSTAR INC: EMCORE to Acquire Solar Cell Business for $21MM
------------------------------------------------------------
EMCORE Corporation (NASDAQ: EMKR - news), a leading provider of
semiconductor technologies for global communications, announced
that it has reached an agreement to acquire certain assets of
the Applied Solar Division business of Tecstar, Inc.
The transaction will make EMCORE the world's largest independent
solar panel integrator. Under the terms of the agreement, which
was signed by the parties on February 6, 2002, EMCORE will pay
$21 million for the solar cell business and operations of
Tecstar. The acquisition will also vertically integrate all
aspects of satellite solar panel construction within EMCORE and
provide EMCORE with solar panel manufacturing expertise with a
proven flight heritage dating back to 1958.
The Tecstar acquisition enables EMCORE to further penetrate the
satellite communications market by expanding the company's
product offerings to include CICs (cover interconnect cells) and
solar panels. EMCORE will now offer solar array integrators and
satellite manufacturers a single supply source to meet their
power requirements. The solar panel array is a critical sub-
assembly in satellite manufacturing. The greater the efficiency
(light-to-energy conversion) in a solar panel, the more
transponders a satellite can support. This results in more
capacity to transmit data and a corresponding increase in
satellite revenues. EMCORE currently manufactures the most
efficient radiation hard solar cell in the world, with a
beginning of life efficiency of 27.5%.
Tecstar, the industry's first solar cell manufacturer for space
applications, has an impressive 40+ year history of providing
fully integrated solar panels that have powered many well known
space programs such as the NASA Mars Pathfinder. With proven
flight processes and solar panel service to all major satellite
solar array integrators in the US and most international
suppliers, Tecstar's experience and firmly established track
record with customers will be paramount to EMCORE's increasing
success in the satellite communications sector.
Reuben F. Richards, Jr., President and CEO of EMCORE, stated,
"EMCORE has the most advanced solar cell technology available
today. By acquiring Tecstar, we are combining our industry-
leading technology with Tecstar's proven flight heritage to
offer manufacturers an integrated solution to meet all of their
satellite power needs from a single source. As a result of this
added capability, EMCORE will play a more direct role in a
satellite's on-orbit success."
Bryon Borgardt, Vice President and Chief Financial Officer of
Tecstar, added, "We are excited that the Tecstar heritage will
continue under the leadership of EMCORE, where our team can
combine its experience with EMCORE's innovative photovoltaic
technology to create the best solar panels available. We are
confident that EMCORE's leading solar cell technology will
provide the building blocks to achieve greater satellite
performance, while Tecstar's history of success with major
satellite providers will enhance these efforts."
The acquisition will be effected through a Chapter 11
reorganization of Tecstar. The motion to approve the sale of
certain Tecstar assets to EMCORE will be filed with the Delaware
Bankruptcy Court this week and requires Bankruptcy Court
approval. The proceeds from the EMCORE transaction and the
disposition or reorganization of Tecstar's remaining assets will
be used for the payment of Tecstar's creditors. The Tecstar
transaction is expected to be immediately accretive to EMCORE
shareholders.
EMCORE Corporation offers a versatile portfolio of compound
semiconductor products for the rapidly expanding broadband and
wireless communications and solid state lighting markets. The
Company's integrated solutions philosophy embodies state of the
art technology, material science expertise and a shared vision
of our customer's goals and objectives to be leaders and
pioneers in the rapidly growing world of compound
semiconductors. EMCORE's solutions include: optical components
for high speed data and telecommunications; solar cells for
global satellite communications; electronic materials for high
bandwidth communications systems, such as Internet access and
wireless telephones; MOCVD tools for the growth of GaAs, AlGaAs,
InP, InGaP, InGaAlP, InGaAsP, GaN, InGaN, AlGaN, and SiC
epitaxial materials used in numerous applications, including
data and telecommunications modules, cellular telephones, solar
cells and high brightness LEDs. For further information about
EMCORE, visit http://www.emcore.com
TELESYSTEM INT'L: Recapitalization Plan Nearing Completion
----------------------------------------------------------
Telesystem International Wireless Inc. (NASDAQ:TIWI)(TSE:TIW)
announced it has completed the majority of the interrelated
transactions contemplated in its recapitalization plan announced
in November 2001.
"The transactions completed significantly improve TIW's
financial position and provide for a sound financial foundation
moving forward," said Andre Gauthier, Vice-President and Chief
Financial Officer of TIW. "TIW's corporate debt is reduced by
approximately US$ 400 million, the Company's economic ownership
in ClearWave increases from 45.5% to approximately 75% and TIW
has significantly increased its liquidities. Since the beginning
of the restructuring process in the summer of 2001, TIW has
reduced its corporate debt by approximately US$ 660 million. We
recognize and appreciate the support we have received from our
stakeholders in this process and the confidence they have
demonstrated in TIW's future," added Andre Gauthier.
TIW has closed a US$52.1 million private placement with an
affiliate of J.P. Morgan Partners LLC, Capital Communications
CDPQ Inc., and Telesystem Ltd., and has issued, subject to
certain escrow arrangements, approximately 85 million Special
Warrants each exercisable for one subordinate voting share of
TIW at no extra cost. TIW has also undertaken to issue to these
same investors 13.3 million warrants to purchase subordinate
voting shares at US$1.00 on or before March 31, 2003. This is
the second tranche of TIW's financing announced in late 2001. In
December 2001, TIW issued approximately 24.5 million Special
Warrants to the same investors for US$15 million. This first
tranche of Special Warrants is exercisable for subordinate
voting shares on the same terms as the second tranche since the
recapitalization plan has been substantially completed. The
total of US$67.1 million in new financing corresponds to the
original US$90 million commitment which has been reduced to take
into consideration shares issued to ESD holders who tendered in
TIW's offer.
Further to an order of the Ontario Superior Court of Justice
(Commercial List), TIW is required to make available to all Unit
holders who tender into the current purchase offer for the
Units, the ability to participate rateably with Telesystem and
Capital Communications in Telesystem and Capital Communications
share of this financing, being an amount of US$42.8 million
committed to acquire 70 million subordinate voting shares, and
an entitlement to 8.5 million warrants. To give effect to this
court order, TIW intends to amend its current purchase offer for
the Units and has set aside in escrow a sufficient amount of
Special Warrants that would otherwise have been issued to
Telesystem and Capital Communications to meet the maximum
entitlement of Unit holders other than Telesystem and Capital
Communications in the financing, as ordered by the Court.
Although Telesystem and Capital Communications have funded their
commitment in full, a portion has been put in escrow to be
reimbursed to them at expiry of the amended Units purchase offer
to the extent that other Unit holders accept to tender and
participate in the financing.
TIW has paid for the 7.00% Equity Subordinated Debentures
maturing February 15, 2002, deposited under the Company's
purchase offer and consent request which expired on February 4,
2002. As a result, TIW has issued approximately 37.7 million
subordinate voting shares of TIW and approximately 3.7 million
September 2002 warrants under the Share Option. Each September
2002 warrant will allow the holder to purchase one subordinate
voting share of TIW at a price of CDN$1.61 at any time until
September 30, 2002. Under the Cash Option, TIW has paid
approximately CDN$6.8 million and has issued approximately 2.5
million March 2003 warrants. Each March 2003 warrant will allow
the holder to purchase one subordinate voting share of TIW at a
price of CDN$1.61 at any time until March 31, 2003. Furthermore,
TIW has paid approximately CDN$0.1 million in consent fee and
has amended and reduced the principal of an aggregate of CDN$5
million in principal amount of ESDs to an aggregate of CDN$1.25
million in principal amount.
TIW has also paid for the 25.3 million Units validly tendered by
Telesystem Ltd, Caisse de depot et placement du Quebec and all
its subsidiaries, and Rogers Telecommunications (Quebec) Inc.,
by issuing approximately 137.9 million subordinate voting shares
of TIW which are prevented from trading until the closing of the
amended purchase offer to Unit holders. As a result, TIW's
economic ownership in ClearWave N.V. (ClearWave) has increased
from 45.5% to approximately 75%. TIW's economic ownership in
ClearWave may be further increased depending on the outcome of
the amended purchase offer to Unit holders.
The Company has also converted 100% of the US$300 million in
principal amount of 7.75% convertible debentures owned by an
affiliate of Hutchison Whampoa Limited, and certain affiliates
of J.P. Morgan Partners LLC, and the accrued and unpaid interest
thereon into approximately 154.5 million subordinate voting
shares. TIW has undertaken to issue warrants to purchase up to a
total of 15 million subordinate voting shares at US$1.00 per
share at any time until September 30, 2002 to Hutchison.
Telesystem has converted all of its 817,462 multiple voting
shares into subordinate voting shares on a one-for-one basis and
TIW now has only one class of common shares.
TIW also announces that it has amended its senior secured
corporate credit facility to allow for extensions of the
maturity of the facility from July 14, 2002 up to December 15,
2002, subject to certain conditions.
The private placement constituted a related party transaction
under applicable securities regulatory requirements and TIW has
relied on an exemption from the valuation and minority approval
requirements contained therein on the basis of the "Financial
hardship exemption", as determined by the Board of the Company,
including two-thirds of the Independent directors.
TIW is a global mobile communications operator with 4.9 million
subscribers worldwide. The Company's shares are listed on the
Toronto Stock Exchange ("TIW") and NASDAQ ("TIWI").
Our Web site address is: http://www.tiw.ca
UBRANDIT.COM: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Ubrandit.com, Inc.
4001 S 700 E #850
Salt Lake City, UT 84107-2535
c/o Hinman
722 W. Shepard Ln #104
Farmington, UT 84025
Debtor affiliate filing separate chapter 7 petition:
Entity Case No.
------ --------
Mindtronics Corporation 02-21678
Type of Business: Ubrandit.com has provided co-branded internet
content, ISP applications and other revenue-
producing applications to businesses and
media groups through its subsidiary,
Mindtronics Corporation, the company engaged
in technology, research, and development.
Chapter 7 Petition Date: January 30, 2002
Court: District of Utah (Salt Lake City)
Bankruptcy Case No. 02-21677
Judge: William T. Thurman
Debtors' Counsel: Annette W. Jarvis, Esq.
LeBoeuf Lamb Greene & MacRae
1000 Kearns Building
136 South Main
Salt Lake City, UT 84101
(801) 320-6700
Total Assets: $13,834,814
Total Debts: $945,860
WARNACO GROUP: Plan Filing Exclusive Period Extended to May 8
-------------------------------------------------------------
The Warnaco Group, Inc.'s exclusive period during which to
propose and file a plan of reorganization is extended through
May 8, 2000. Likewise, Warnaco's solicitation period within
which to solicit acceptances of that plan is extended through
July 8, 2002. (Warnaco Bankruptcy News, Issue No. 19; Bankruptcy
Creditors' Service, Inc., 609/392-0900)
WHEELING-PITTSBURGH: Hires Tatum CFO for Short-Term Consulting
--------------------------------------------------------------
Wheeling-Pittsburgh Corporation and Wheeling-Pittsburgh Steel
Corporation jointly ask Judge Bodoh to authorize their
employment of Mr. James R. Duncan, Jr., of Tatum CFO Partners
LLP, to provide short-term financial consulting services
relating to WPC's 50% equity investment in Ohio Coatings
Company, and WPSC's supply agreement with OCC, effective nunc
pro tunc to January 17, 2002.
Michael E. Wiles, Esq., at Debevoise & Plimpton in New York,
tells Judge Bodoh that Ohio Coatings Company is a company which
produces tin plate. OCC's current senior financing is maturing
and OCC is actively looking for alternative sources of
financing. The interests of OCC are intertwined with those of
WPC and WPSC to the extent that if OCC were to be unable to
sustain operations, it would have a negative impact on the
financial condition and operations of the Debtors.
The Debtors anticipate Mr. Duncan and Tatum will complete their
work no later than the end of April, 2002, and probably sooner.
Specifically, Mr. Duncan and Tatum will be:
(a) assisting WPC with respect to enhancing the value of
WPC's equity interest in OCC;
(b) assisting WPC with respect to enhancing the value of
WPC's equity interest in OCC;
(c) assisting WPC in the development of a strategy for
the disposition of some or a part of WPC's equity interest in
OCC;
(d) assisting WPC and the Debtors with any negotiations
involving Dong Yank Tin Plate of Korea, the remaining fifty
percent shareholder of OCC, relating to the foregoing;
(e) assisting the Debtors in considering the OCC banking
relationships and acting as a liaison for the Debtors with OCC's
current lenders in responding to any information requests by the
Debtors from OCC's lenders;
(f) assisting WPSC in maintaining its favorable supply
agreement with OCC relating to the sale of tin plate; and
(g) providing such other necessary services as requested
by the Debtors with respect to the foregoing.
On 5 days' advance written notice, either party may terminate
the agreement, with the termination to be effective on the date
specified in the notice so long as that date is no earlier than
five days from the date of delivery of the notice. Tatum will
continue to render services and to be paid during that five-day
period. The Debtor s agree that reports, projections or
forecasts may be prepared only at the Debtors' direction and
will reflect the Debtors' own judgment. Tatum makes no
representation or warranty as to the accuracy or reliability
of reports, projections or forecasts derived from use of the
information it provides, and will not be liable for any claims
of reliance on such reports, projections, forecast or
information.
The Debtors agree to indemnify Tatum to the full extent
permitted by law for any losses, costs, damages and expenses,
including reasonable attorneys' fees, as they are incurred, in
connection with (i) any cause of action, suit or other
proceeding arising in connection with Tatum's engagement by the
Debtors under this agreement, Tatum's provision of services to
the Debtors, or the Debtors' use of any analyses or information
provided by Tatum, and (ii) any legal proceeding in which Tatum
may be required or agree to participate. This indemnity will
not apply to Tatum's gross negligence or willful misconduct, or
to actions taken by Tatum in bad faith.
The Debtors propose that Tatum be compensated for the services
to be rendered to the Debtors at their ordinary billing rate of
$150 per hour, but not to exceed $1,350 in any one day, in
accordance with Tatum's customary billing practices regarding
charges and expenses.
The retention agreement also provides that Tatum is to receive a
retainer in the amount of $20,000 to be applied against the time
charges and expenses specific to its last application for
payment for its engagement.
Mr. James R. Duncan, Jr., an engagement partner for Tatum CFO
Partners LLP in Pittsburgh, discloses that he has "experience in
restructuring debt for a $100 million modernization and capital
expansion project which included a $115 million private
placement and $26.5 million public revenue bonds issued by the
State of Ohio." In addition, Mr. Duncan advises that he managed
the Chapter 11 reorganization process for Copperweld Steel
Company between 1993 and 1995.
Mr. Tatum also states that Tatum has provided, and likely will
continue to provide, services unrelated to the Debtors' cases
for PNC Bank, NA, although Tatum is not currently providing any
services to the Bank. He avers that he and Tatum are
disinterested, and neither hold nor represent any interests
adverse to the Debtors in the matters for which approval of
employment is sought.
The US Trustee Objects
Notwithstanding Mr. Duncan's averments, Ira Bodenstein, United
States Trustee for Region 9, in furtherance of his
administrative duties, objects to this Application because under
the terms of retention, the Debtors are obligated to "provide
extensive indemnification" for Tatum.
The Trustee notes that he made informal objections to this
Application which have been resolved. These included certain
concessions that Tatum will not require the Debtors to replenish
its retainer, and that Tatum has eliminated certain limitations
of liability from its Project Work Agreement, as well as certain
time requirements.
The Indemnity
Even with these concessions, the US Trustee, citing the
indemnity provision noted above, says that, except for the
exclusion relating to gross negligence, bad faith or willful
misconduct, the indemnity clause is unlimited in scope and
dollar amount.
The Trustee reminds Judge Bodoh that professionals retained by
debtor estates are fiduciaries. Tatum's request for blanket
indemnification of its mistakes, poor performance and negligence
runs counter to the high level of expertise and professionalism
espoused in support of its retention. Bankruptcy courts have
ruled that fiduciaries should not be relieved of the
consequences of their actions through an indemnification clause.
While Mr. Bodenstein says he recognizes that Judge Bodoh has
permitted similar indemnification provisions in the past, he
asserts such provisions would place an undefined and unlimited
expense burden on a case already facing "dire financial
circumstances" as reflected in the losses WPSC has reported and
continues to report in its monthly operating reports, most
recently $14,470,534 for November 2001. At this stage of the
case, Mr. Bodenstein believes that the indemnity provision
should be "excluded from the universe of reasonable terms and
conditions" and the Application denied.
The Debtors' Last Word
Wheeling-Pittsburgh Steel Corporation and Wheeling-Pittsburgh
Corporation submit that the terms of the proposed indemnity are
consistent with ordinary practices and with the requirements of
the Bankruptcy Code.
The Bankruptcy Reform Act of 1978 represented a significant
shift in historical policy with respect to professional
retentions. Previously, bankruptcy professionals had been paid
according to notions of "economy of estate," under which
professional compensation lagged behind that of professionals in
non-bankruptcy contexts. The legislative history accompanying
the 1978 amendments clearly expressed Congress's intent that
bankruptcy professionals be compensated on terms that are
similar to those that apply outside of bankruptcy:
[B]ankruptcy legal services are entitled to command the same
competency of counsel as other cases. In that light, the policy
of [Section 330] is to compensate attorneys and other
professionals serving in a case under title 11 at the same rate
as the attorney or other professional would be compensated for
performing comparable services other than in a case under title
11.
The clear import of the Bankruptcy Code's legislative history is
that professionals retained by a Chapter 11 debtor are entitled
to, and as a matter of public policy should receive, the same
compensation in bankruptcy and nonbankruptcy engagements. As a
result, the Bankruptcy Code permits a debtor to retain a
professional who is disinterested and does not hold or represent
an interest that is adverse to the estate, so long as the terms
and conditions of such retention are "reasonable." The Debtors'
decision to retain a professional on such reasonable terms
is a business decision to be afforded deference under a
"business judgment" standard of review.
Indemnities, including those extending to the indemnitee's
negligence, are a typical feature of commercial transactions.
They are consistent with fiduciary responsibilities, and are
commonly found in transactions involving fiduciaries. For
example, trust agreements and trust indentures commonly include
provisions indemnifying the trustee against a broad range of
claims and liabilities, including those arising out of the
trustee's own negligence. Similarly, a corporation's directors
and officers are generally indemnified under state corporate
law.
As Chief Judge Bernstein of the Southern District of New York
stated in the Halpern case: [T]he idea that a fiduciary cannot
be indemnified for negligence, or that such indemnification is
contrary to public policy, is just plain wrong. The common law
has carved out clear exceptions to indemnity, such as bad faith,
breach of trust, dishonesty, self-dealing, and willful, reckless
or grossly negligent misconduct, leaving the rest to the
parties' agreement.
In particular, indemnification is a customary practice in the
financial advisory industry both in and out of bankruptcy.
Indemnification provisions similar to one that has been included
in the Tatum retention agreement have previously been approved
in this case with respect to Jay Alix and with respect to the
retentions of Price Waterhouse Securities and Rothschild, Inc.
Indemnifications were also approved by this Court in the LTV
case and approved on appeal. In addition, similar agreements
have been approved in numerous other large Chapter 11 cases in
other districts. The proposed indemnity is consistent with the
customary practice of indemnifying financial advisors, whether
in the bankruptcy context or otherwise. For that reason, and for
the other reasons set forth above, the Debtors submit that the
proposed indemnity is a reasonable term of employment that is
fully consistent with the Bankruptcy Code and with the best
interests of their estates.
For these reasons and those set forth in the papers originally
submitted in support of their Application, the Debtors submit
that the retention of Tatum should be approved and that the
Objection of the United States Trustee should be overruled.
(Wheeling-Pittsburgh Bankruptcy News, Issue No. 17; Bankruptcy
Creditors' Service, Inc., 609/392-0900)
WOLVERINE TUBE: Lenders Waive Revolver's Financial Covenants
------------------------------------------------------------
Wolverine Tube, Inc. (NYSE: WLV) announced that to address any
potential financial covenant violations under its $200 million
Revolving Credit Facility, the Company has entered into a
Limited Waiver with its lenders. Under the terms of the Limited
Waiver, the lenders waived compliance with the financial
covenants contained in the Facility from December 31, 2001
through April 16, 2002.
In return, the Company agreed to limit borrowings under the
Facility to an aggregate amount of $130 million, to grant a
security interest in all U.S. accounts receivable and inventory
to secure all new borrowings under the Facility after the date
of the execution of the Limited Waiver, adjust the floating base
interest rate on the to LIBOR plus 3.00% and limit certain non-
operating activities of the Company.
In addition to the Limited Waiver, the Company and the lenders
entered into a Sixth Amendment to Credit Agreement and Security
Agreement documenting the agreed upon terms in the Limited
Waiver. The Facility matures on April 30, 2002 and the Company
is in the process of negotiating a refinancing structure.
Jed Deason, Chief Financial Officer stated, "Given the current
recession and general business environment, the Limited Waiver
provides the Company with adequate time to either refinance or
restructure the Facility with an appropriate financing facility
that meets the longer-term needs of the Company. This process
is well underway!" The Company believes that the funds
available from the Facility together with cash flow from
operations will be sufficient to satisfy the Company's normal
operating requirements, including working capital needs,
interest obligations, mandatory redemption of its preferred
stock and capital spending requirements, during the period of
the waiver. As of February 4, 2002, the Company had
approximately $100 million in outstanding borrowings and
obligations under the Facility.
Wolverine Tube, Inc. provides its customers with copper and
copper alloy tube, fabricated products, brazing alloys, fluxes
and lead-free solder, as well as copper and copper alloy rod,
bar and strip products. Internet addresses: http://www.wlv.com
and http://www.silvaloy.com
WORLD WIDE WIRELESS: Celeste Trust Discloses 9.99% Equity Stake
---------------------------------------------------------------
Celeste Trust Reg., whose principal business office is located
at Trevisa-Treuhand-Anstalt, Landstrasse 8, 9496 Furstentums,
Balzers, Liechtenstein benificially owns 19,218,925 shares of
the common stock of World Wide Wireless Communications, Inc.
The aggregate amount of 19,218,925 shares represents 9.99% of
the outstanding common stock of World Wide Wireless. Celeste
Trust Reg. holds sole powers of voting or disposing of the
entire amount of stock held.
The aggregate amount represents the maximum amount of shares
that Celeste Trust Reg. can beneficially control under a
contractually stipulated 9.99% ownership restriction. The full
conversion of Celeste's Convertible Debenture and exercise of
warrants would exceed this amount.
In February of 1997, Worldwide Wireless, Inc., a Nevada
corporation, was formed to coordinate the operations of TSI
Technologies, Inc., a Nevada corporation, and National Micro
Vision Systems, Inc., a Nevada corporation. Its purpose was to
complete the development of its patented advanced distributed
wireless telephone and network designs and to finance,
manufacture, and market these units and systems. TSI
Technologies, Inc., was the research and development company
formed for the purpose of creating and developing the
distributed wireless call processing system. National Micro
Vision Systems, Inc. was formed to operate a network of wireless
Internet sites. In April of 1998, Worldwide Wireless, Inc., TSI
Technologies, Inc. and National Micro Vision Systems, Inc.
acquired Upland Properties, Inc., a Nevada corporation, for
stock and transferred their assets to Upland Properties, Inc.
Upland Properties, Inc. then changed its name to World Wide
Wireless Communications, Inc. and began trading on the OTC
Bulletin Board under the symbol WLGS. National Micro Vision
Systems, Inc. is now completely separate from and unrelated to
us.
As of September 30, 2001 the company's total working capital was
deficient in the amount of $1,916,398. During 2001 and 2000, it
experienced continuing cash shortages due to an insufficient
subscriber base. The resulting cash shortages rendered the
company unable to advertise and aggressively promote its
services. Because the company has not received sufficient
revenues from operations and do not anticipate receiving
sufficient revenues for the next 12 months from operations, it
will need to obtain substantial funding from external sources
over the next twelve months to finance our current operations.
* BOOK REVIEW: Getting It To the Bottom Line: Management by
Incremental Gains
-----------------------------------------------------------
Author: Richard S. Sloma
Publisher: Beard Books
Soft cover: 96 pages
List Price: $34.95
Review by Gail Owens Hoelscher
Buy a copy for yourself and one for a colleague on-line at:
http://amazon.com/exec/obidos/ASIN/1893122832/internetbankrupt
In the author's words, "(t)his is a book about how to optimize
operating profit in an ongoing business consistent with and
supportive of the owners' (and/or creditors') demands." As in
his book The Turnaround Manager's Handbook, also published by
Beard Books, Richard Sloma's guidance is all-inclusive,
straightforward, and wise. He is perhaps unique in his ability
to use quotes and maxims liberally without sounding the least
bit preachy or trite.
A quote from Francois Voltaire, "perfection is attained by small
degrees," explains the main premise of this book, management by
incremental gains. It is based on the simple notion that change,
for better or worse and accidentally or on purpose, only occurs
incrementally. Without a succession of small changes in the same
direction there can be no progress or growth. Mr. Sloma defines
management as "getting work done through the efforts of others."
Thus, change in an organization depends on people. Mr. Sloma
takes a pragmatic (and perhaps somewhat dim!) view of the
ability of people to change, and maintains that the smaller a
change planned by management, the more likely it is to be
successfully implemented.
Mr. Sloma provides "real-world tested and proven methodology for
working with people in a professional manner to maximize their
individual commitment to goal achievement." He offers
recommendations based on his more than 30 years of management
experience that "strike(s) the long-sought-after logical balance
of viewing and managing people as if they were competent,
conscientious, and ambitious individuals who genuinely seek
opportunities for professional growth and development."
Getting It To The Bottom Line is not only about people skills,
by any means. Mr. Sloma introduces financial and operational
performance numbers, and gives details on how income statements
and cash flow statements measure the magnitude and direction of
planned changes in financial and operational performance. His
operational framework is illustrated in the following eight
steps:
* Quantify the do-nothing scenario
* If it works, don't fix it
* If it doesn't, quantify minimal acceptable performance
levels
* Quantify components of any financial performance gap
* If necessary, cut your losses, liquidate, and reinvest
elsewhere
* Quantify management action plans to bridge the
performance gap
* Define and establish a reporting and control system
* Define and implement an incentive compensation program
Mr. Sloma examines each step thoroughly, using recognized
financial analysis methods, as well as some of his own.
Throughout, he consistently emphasizes the importance of
achieving ambitious goals one small step at a time. He
admonishes managers to "spend no time or effort making `little'
plans. They have no magic to stir men's blood - or to make
owners as wealthy as they could be!"
This is a solid and substantive book that targets managers at
every level. Mr. Sloma presents his concepts in such a way that
anyone charged with leading an organization can learn to do it
better. On the last page, he even tells readers to "drop me a
line and let me know what you think and how it's going." Why not
read the book and take him up on it?
Richard S. Sloma is an attorney with more than 30 years of
senior management experience. He has served as Chief Executive
Officer, Chief Operating Officer, Chairman and Vice Chairman of
the Board of Directors and Board Member of six international
companies. He holds degrees in business from Northwestern
University and the University of Chicago, and a law degree from
De Paul University.
*********
Bond pricing, appearing in each Monday's edition of the TCR, is
provided by DLS Capital Partners in Dallas, Texas.
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Wednesday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged. Send announcements to
conferences@bankrupt.com.
Bond pricing, appearing in each Thursday's edition of the TCR,
is provided by DebtTraders in New York. DebtTraders is a
specialist in global high yield securities, providing clients
unparalleled services in the identification, assessment, and
sourcing of attractive high yield debt investments. For more
information on institutional services, contact Scott Johnson at
1-212-247-5300. To view our research and find out about private
client accounts, contact Peter Fitzpatrick at 1-212-247-3800.
Real-time pricing available at http://www.debttraders.com/
Each Friday's edition of the TCR includes a review about a book
of interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.
For copies of court documents filed in the District of Delaware,
please contact Vito at Parcels, Inc., at 302-658-9911. For
bankruptcy documents filed in cases pending outside the District
of Delaware, contact Ken Troubh at Nationwide Research &
Consulting at 207/791-2852.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter is a daily newsletter co-published by
Bankruptcy Creditors' Service, Inc., Trenton, NJ USA, and Beard
Group, Inc., Washington, DC USA. Yvonne L. Metzler, Bernadette
C. de Roda, Ronald P. Villavelez and Peter A. Chapman, Editors.
Copyright 2002. All rights reserved. ISSN: 1520-9474.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without
prior written permission of the publishers. Information
contained herein is obtained from sources believed to be
reliable, but is not guaranteed.
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*** End of Transmission ***