T R O U B L E D C O M P A N Y R E P O R T E R Wednesday, April 21, 2004, Vol. 8, No. 78 Headlines 1817 DEWEY SQUARE: Case Summary & 20 Largest Unsecured Creditors 1819 CLUB: Live Bankruptcy Auction Scheduled for May 18 AHOLD: Reports Improved Fiscal Year 2003 Financial Results AMERICAN SPORTS: Brings-In TRG Inc. as Financial Advisor AURORA FOODS: Miller Buckfire Asks $6 Million Compensation B&G FOODS: S&P Places B-Level Credit Rating on Watch Negative BIDDLE-ASHLAND: Gets OK to Employ Heneson as Bankruptcy Counsel BRIDGEPORT METAL: Section 341(a) Meeting Slated for May 3, 2004 CABLE DESIGN: S&P Lowers Corporate Credit Rating to BB- CALPINE: First Quarter 2004 Earnings Conference Call is on May 6 CANADA PAYPHONE: Intends to File BIA Plan Proposal on May 7, 2004 COLE NATIONAL: S&P Revises CreditWatch Implications to Developing CONSECO INC: S&P Places Low-B & Junk Ratings on Watch Positive DESERT VIEW LLC: Case Summary & 5 Largest Unsecured Creditors ELITE MODEL: Carl Marks Capital to Sell 'Supermodel' Agency EMAGIN CORPORATION: George Haywood Has 6.1% Equity Stake ENRON CORP: Objects to 54 Late-Filed Hazelwood Claims ENRON CORPORATION: Inks Stipulation Reducing GE Capital's Claim EOS INTL: Files Form 15 to Terminate SEC Reporting & Delist Shares EQUUS GAMING: Still Unable to File Form 10-K over Units' Results EXPO DYEING & FINISHING: Case Summary & 20 Unsecured Creditors FIRST NATIONAL: Case Summary & 31 Largest Unsecured Creditors FLEMING: Barry Road Pushes Court to Allow $1.1M Admin. Claim FLOWSERVE: Expects to File 2003 Form 10-K Next Week FRANCE GROWTH: Elects V-Chairman Bergan to Supervise Liquidation GRAFTECH INT'L: Pioneer Global Discloses 6.95% Equity Stake HALLIBURTON: Settling Barracuda-Caratinga Dispute with Petrobras HASBRO INC: First Quarter Net Earnings Increase to $6.5 Million HIDDEN POINTE: Retains Schreeder Wheeler as Bankruptcy Attorney HILL WILLIAMS: Case Summary & 14 Largest Unsecured Creditors INTERSTATE BAKERIES: S&P Lowers Corporate Credit Rating to CCC+ KOCE: Daystar Television to Appeal Sale Ruling LAIDLAW INC: Reports Employee Stock Awards and Options METRIS COS: Considers $250MM Senior Secured Debt Private Placement MINOPLANET: Fiscal 2004 2nd Quarter Net Loss Down to $1.3 Million MIRANT CORP: Wants Go-Signal to Nix PG&E Gas Executory Contracts MIRANT CORPORATION: 2003 Net Loss Widens to $3.8 Billion MJ RESEARCH: Found Guilty in Patent Infringement Suit NAT'L CENTURY: L. Poulsen Asks Court to Estimate Claims for Voting NAT'L CENTURY: Agrees to Extend Intercompany Bar Date to April 30 NORSKECANADA: First Quarter 2004 Results Webcast Set for Apr. 30 NOVASTAR: SEC Initiates Informal Inquiry into Business Practices NUEVO ENERGY: Agrees to Merge Operations with Plains Exploration PACIFIC CARE: Improved Profitability Spurs Fitch's Ratings Upgrade PARMALAT: US Debtors Want to Mull on Leases Until Court OKs Plan PER-SE TECHNOLOGIES: Issues First Quarter 2004 Operations Update PG&E NATIONAL: Auctioning-Off GTNC Assets on May 3, 2004 PILLOWTEX: Demands Payment of Obligations from Kohl's Dept. Stores PLUMBEREX SPECIALTY: Case Summary & Largest Unsecured Creditors POTLATCH CORPORATION: Reports Improved First Quarter Earnings QWEST COMMS: First Quarter 2004 Earnings and Webcast Information REGAL ENTERTAINMENT: S&P Revises Outlook on Low-B Ratings to Neg. ROCKWOOD SPECIALTIES: Planned Purchase Spurs S&P to Watch Ratings SAINT JOSEPH'S PHARMACY: Voluntary Chapter 11 Case Summary SHAW GROUP: Obtains Go-Signal to Proceed on Astoria Energy Project SOLUTIA INC: Agrees to Set Off Mutual Debts with PPG Industries SPIEGEL GROUP: Proposes $750,000 Break-Up Fee for Pangea STRATEGIC HOTEL: Fitch Downgrades Class J Notes' Rating to BB+ TENNECO: S&P Keeps Positive Watch on Ratings over Planned Offer TESORO PETROLEUM: Fixes First Quarter Conference Call for May 6 TIMBER DOODLE: Case Summary & 14 Largest Unsecured Creditors TREASURE MOUNTAIN: Ex-Auditor Airs Going Concern Uncertainty UNITED AIRLINES: Wants Court Nod for New Aircraft Operating Pact UNITED AIRLINES: Has Exclusive Right, Until May 7, to File Plan WARNACO GROUP: Discusses Potential Settlement with SEC Staff WHEREHOUSE ENTERTAINMENT: Delaware Court Confirms Liquidating Plan WICKES: Committee Turns to Houlihan Lokey for Financial Advice WORLDCOM: Emerges from Chapter 11 Protection as MCI, Inc. * 15 Hunton & Williams Attorneys Named 2004 Georgia Super Lawyers * Chadbourne & Parke Welcomes Securities Litigator Joaquin Sena * The Deal Launches 12-Page Weekly Newsletter for $7,500 per Year * Upcoming Meetings, Conferences and Seminars ********* 1817 DEWEY SQUARE: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: 1817 Dewey Square, LLC dba Photographics 1245 Farmington Avenue West Hartford, Connecticut 06107 Bankruptcy Case No.: 04-20962 Chapter 11 Petition Date: April 1, 2004 Court: District of Connecticut (Hartford) Judge: Robert L. Krechevsky Debtor's Counsel: Myles H. Alderman, Jr., Esq. Alderman & Alderman 100 Pearl Street, 14th Floor Hartford, CT 06103 Tel: 860-249-0090 Total Assets: $1,153,600 Total Debts: $290,089 Debtor's 20 Largest Unsecured Creditors: Entity Nature Of Claim Claim Amount ------ --------------- ------------ CIT Small Business Lending Lease $208,911 Cynira, LLC Loan against $40,000 Inventory purchase 12/7/01 covered deficiency in loan from CIT. State of Connecticut State tax - $10,918 delinquent BNW Distribution, Inc. Photographic paper, chemistry $4,500 SBC SNET Yellow Pages $4,500 Fleet Bank Credit Card $4,477 J&J Imageworks Outlab production, $4,400 custom photo printing, large format printing, mounting, and laminating. C.R. Gibson Albums, greeting $2,770 Cards Safety - Kleen Hazard Waste Disposal $2,750 PI&P Outlab production, $2,000 digital printing and holiday greeting cards. Cox Communications Phones and Internet $722 Martin Aborn, Inc. Frames $650 Picture Products, Inc. Frames $570 CNG Heat $440 Prinz Ltd. Frames and Albums $325 Northeast Utilities Electricity $323 Forte Co. Frames $235 Griswold Mall Associates Ltd Commercial Lease $10 Dell Financial Lease Unknown Internal Revenue Service $1 1819 CLUB: Live Bankruptcy Auction Scheduled for May 18 --------------------------------------------------------- The chapter 11 trustee for 1819 Club in Washington, D.C., will auction: * a Class CN live adult entertainment liquor license and * a prime piece of D.C. real estate on May 18. Well-known as DC's original Gentlemen's Club, the venue will be sold at live auction as an ongoing concern, according to D.C. attorney Bryan Ross, the court-appointed trustee for the club, which filed for Chapter 11 bankruptcy protection earlier this year. The business and licenses are owned by SNOCO Enterprises, Inc. Long-time D.C. resident Nicholas "Nick" Addams is 90 percent owner of the business and sole owner of the real estate. Located at 18th & M Street Northwest on Dupont Circle South, the club was known as Joanna's until three years ago when Addams changed the name to reflect the actual mailing address: 1819 M Street, N.W. The live auction will be held at this location on Tuesday, May 18 starting at 11:00 a.m., with a 2:00 p.m. hearing scheduled later that day before the U.S. Bankruptcy Court in D.C. to approve the sale. Open nightly from 6:00 p.m. to 2:00 a.m., the club takes up the first floor of a four-story building. Officially, it seats 75. Addams, however, already has ABC approval to expand the operation to the second floor, nearly doubling the seating capacity. "The second floor is completely gutted and ready for build-out," according to Addams, who says, "New owners could easily double the gross income for a relatively modest investment. You could add 40 seats in less than 60 days with renovation costs of under $150,000." Addams also notes that until this past December, the club was open for lunch, something "the new owner could easily restart." In 1977, Addams bought the club which was known at the time as King Arthur's, reflecting a "Knights of the Round Table" theme that then pervaded this D.C. block. Another similar club called Camelot's, which still operates, is just two doors up. After Addams purchased the club, he immediately renamed it Joanna's in tribute to the club's star dancer. Many old-time patrons still refer to it by this name. Today the night spot employs 25 and features eight dancers each evening, from "Amy" and "Mya" to "Alexi" and "Champagne." The club has a loyal following of customers ages "21 to 75" and much repeat business according to Addams, who says a visit to the club has become a "rite of passage" for young men, who later choose the club as the site for bachelor parties and other gatherings. Additionally, there are 27 hotels within a half-mile mile radius of the club, making it convenient for business travelers. "It's almost unheard of for a Class CN license to become available. In fact, there are only six establishments that have this in all of D.C. Not only is the competition limited for this business, the real estate is incredibly valuable as well," says Stephen Karbelk, AARE, of Tranzon Fox, who will conduct the live auction. "The new owner or investment group could easily expand the club to the second floor and add office space or condominiums on floors three and four," Karbelk says. Tranzon Fox, based in Burke, VA, is part of Tranzon, LLC, a nationwide accelerated marketing and auction firm with offices coast-to-coast and national headquarters in Richmond, VA. Last year the company conducted more than 1,300 auctions in 41 states and the District of Columbia. Tranzon professionals specialize in providing real estate and business asset and liquidation auction and accelerated marketing services to corporations, financial institutions, trustees, individuals and estates throughout the U.S. Learn more about Tranzon at http://www.tranzon.com/ For a complete bidder's auction package, including the bidding procedures, contact Stephen Karbelk at 703-912-3307 (office) or 703-927-6838 (cell) or via E-mail at skarbelk@tranzon.com. AHOLD: Reports Improved Fiscal Year 2003 Financial Results ---------------------------------------------------------- Ahold released its Fiscal 2003 financial results this week. Highlights of 2003 - Net loss Euro 1 million (2002: net loss of Euro 1.2 billion) - Operating income Euro 718 million (2002: operating income Euro 239 million) - Net sales Euro 56.1 billion, a decrease of 10.6% compared to 2002, but an increase of 2.7% excluding foreign currency translation impact - Net loss under US GAAP Euro 747 million (2002: net loss Euro 4.3 billion) - Improved balance sheet: equity increased to Euro 4.9 billion (2002: Euro 2.6 billion). Net debt reduced to Euro 7.5 billion (2002: Euro 12.3 billion) - Net cash before financing activities generated Euro 1.5 billion (2002: net cash outflow Euro 107 million) Zaandam, The Netherlands, April 19, 2004 - Ahold published its 2003 results. "We are pleased to announce that we have clearly improved results in 2003, an extremely challenging year," said Hannu Ryopponen, Chief Financial Officer, commenting on the results. "A very turbulent period for the company was marked by the events announced in February 2003, as well as a tough trading environment in our key markets." Anders Moberg, CEO commented: "Months of ongoing effort resulted in a number of achievements, specifically defining a new strategy and creating the financial platform to move forward. At the end of last year we indicated that 2003 in many respects had been a lost year, but today's announcement also shows that Ahold is on track with its 'Road to Recovery' program." Executive Summary Improved results in a very challenging year Results for 2003 were heavily impacted by challenging markets, negative currency movements and non-recurring items. However, Ahold generated a modest net loss of Euro 1 million in 2003 compared to a loss of Euro 1.2 billion for 2002. Operating income in line with expectations Operating performance was in line with expectations, with no major additional goodwill impairment write-downs needed. The most important elements were the major negative swings in U.S. Foodservice's results from profit to loss as a result of primarily the sharp deterioration in pricing leverage with suppliers, the competitive pressure on U.S. and European retail operations, and the exceptional items on the sale of various companies. The costs associated with the irregularities and investigations of 2003 also impacted operating income. Higher net sales in local currencies Although economic conditions in all of Ahold's major trading areas were tough and competition remained intense, sales in local currencies nevertheless were resilient on an annual basis. The main retail trade operations, except Albert Heijn, showed net sales increases in local currencies, as well as U.S. Foodservice. The influence of the weak U.S. dollar throughout 2003 can clearly be seen on Ahold's reported net sales numbers in Euro. Divestments that took place in 2003 only had a slight impact on net sales. Improved balance sheet Ahold concluded 2003 with a significantly improved balance sheet as part of the 'Road to Recovery' Program that will be continued in 2004 and 2005. Net debt was reduced by a very substantial Euro 4.8 billion, as a result of the rights issue and initiatives to improve cash flow from the businesses. The strengthening of Ahold's financial position continues; further proof was delivered last week, when Ahold announced an Euro 920 million early debt redemption. Strong cash flow generation Whereas 2003 remained a tough year for all our businesses, net cash from operating activities remained strong. At the same time, selective investments lead to a sharp decrease in cash outflow from investing activities. As a result net cash before financing activities increased sharply to Euro 1.5 billion for the full year, compared to a net outflow in the previous year of Euro 107 million. Ahold 2003 Full Year Results Ahold prepares its financial statements in accordance with accounting principles generally accepted in the Netherlands ("Dutch GAAP"). Dutch GAAP differs in certain material aspects from accounting principles generally accepted in the United States ("US GAAP"). All financial information in this press release is based on Dutch GAAP unless otherwise noted. The figures reported in this press release are unaudited. Ahold plans to publish its Annual report and file the Annual report on Form 20-F on the 6th of May. In certain instances, results presented in this press release either exclude the impact of fluctuations in currency exchange rates used in the translation of Ahold's foreign subsidiaries' financial results into Euros or are presented in local currencies, which provides a better insight into the operating performance of foreign subsidiaries. For more information regarding the non-GAAP financial measure excluding currency impact, see "Definitions" below. In addition, in certain instances, operating income for Ahold's business segments is presented excluding the impact of the impairment and amortization of goodwill and exceptional items. Operating income before impairment and amortization of goodwill and exceptional items is a non-GAAP financial measure. A reconciliation of this non-GAAP financial measure to the Dutch GAAP measure of operating income, as well as management's explanation for the use of this measure, are set forth in Annex B. In this press release net cash flow before financing is used, which totals the net cash from operating activities and net cash from investing activities. Ahold adopted EITF 02-16 "Accounting by a Customer (including a Reseller) for certain Consideration Received from a Vendor" in the fourth quarter of 2003. Because this issue was effective for Ahold for the period beginning December 30, 2002, the results previously announced in the quarterly press releases differ from the results included in the full year 2003. Net sales Net sales down 10.6%, but up 2.7% excluding currency impact Many of Ahold's business areas posted increased net sales in local currencies despite challenging economic conditions and intense competition The 10.6% decrease in net sales was largely attributable to lower currency exchange rates against the Euro, particularly for the U.S. Dollar. The average U.S. Dollar to Euro exchange rate decreased approximately 16.5% in 2003 compared to 2002. Net sales excluding currency impact increased by 2.7% mainly due to increases in net sales excluding currency impact of 2.7% in the U.S. retail trade operations, 1.7% for the Europe retail trade operations, 2.3% at U.S. Foodservice and 17.8% in South America. Net sales in 2003 were favorably impacted by the full year consolidation in Ahold's consolidated financial statements of Disco, Ahold's subsidiary in Argentina, which began to be consolidated in the second quarter of 2002 and the full-year impact of the acquisitions at U.S. Foodservice in 2002. The divestments of various operations during 2003 only slightly negatively impacted net sales. Operating income Operating income before impairment and amortization of goodwill and exceptional items was primarily affected by a sharp decrease at U.S. Foodservice and by advisory fees Business profitability came under pressure in 2003 led by a sharp decrease at U.S. Foodservice, and competitive pressure on U.S. and European retail operations. Operating income before impairment and amortization of goodwill and exceptional items in 2003 decreased to Euro 1,065 million compared to Euro 2,144 million in 2002. U.S. Foodservice swung from a positive Euro 314 million of operating income before impairment and amortization of goodwill and exceptional items in 2002 to a Euro 72 million loss in 2003 as the loss of leverage with suppliers impacted gross margins and increased operating costs, resulting from the repercussions from accounting irregularities announced and investigations conducted in 2003. Operating expenses also increased in large part as a result of additional audit, legal, consultancy fees and other costs primarily in connection with the forensic accounting and legal investigations and the audit of the 2002 financial statements (approximately Euro 170 million). Operating income in line with expectations including minor impairment charges Operating income improved to Euro 718 million compared to Euro 239 million in 2002 which was in line with expectations. This was mainly due to a more than Euro 1.2 billion drop in the level of goodwill impairment charges compared to 2002, and also from lower exceptional items. Goodwill amortization Goodwill amortization in 2003 amounted to Euro 166 million, a decrease of 34.1% compared to 2002. This decrease was primarily due to lower goodwill balances at year-end 2002 resulting from the goodwill impairment charges recorded in 2002 and to the lower average currency exchange rate of the U.S. Dollar against the Euro. Goodwill impairment Goodwill impairment charges decreased from Euro 1,281 million in full year 2002 to Euro 45 million in full year 2003. Exceptional items: mostly non cash items with no impact on equity A loss of Euro 136 million was recorded in 2003 compared to an exceptional loss of Euro 372 million in 2002. The 2003 exceptional items mainly related to the divestment of foreign subsidiaries, principally Ahold's Chilean and Malaysian operations. Of these exceptional items, Euro 96 million related to the recognition of accumulated foreign currency translation adjustments in the statement of operations and Euro 44 million to the reversal of part of the goodwill, both of which had previously been charged to shareholders' equity. These exceptional items were non-cash and had no impact on the overall level of shareholders' equity. Exchange rate differences related to the translation of the financial statements of a foreign subsidiary into Euros are recorded directly in shareholders' equity. When these exchange rate differences are realized upon the sale of the relevant foreign subsidiary, the cumulative foreign currency translation adjustments are recognized in the statement of operations. Under Dutch GAAP, goodwill previously deducted directly from shareholders' equity upon the acquisition of the subsidiary has to be reclassified pro-rata to the statement of operations if the subsidiary is sold within six years of the initial acquisition. The exceptional loss in 2002 was caused by the default by Velox Retail Holdings, Ahold's former joint venture partner, on bank debt that Ahold had guaranteed. Net loss Break-even result Ahold closed 2003 with a small net loss of Euro 1 million, compared to a net loss of Euro 1.2 billion in 2002 under Dutch GAAP. This was primarily caused by the significant reduction in goodwill impairment charges and by the lower amount of exceptional items as mentioned above. The company reported an operating loss at U.S. Foodservice as well as lower operating income at a number of other business segments and at corporate the company had significantly higher audit, legal, consultancy and banking fees as well as other costs. The weakening of the U.S. Dollar against the Euro also had a negative impact on net income. Net financial expense includes substantial banking fees for the 2003 credit facility Net financial expense, which comprises net interest expenses, gains and losses on foreign exchange and other financial income and expense, was Euro 938 million in 2003 compared to Euro 1.0 billion in 2002. Net interest expenses in 2003 amounted to Euro 952 million, an increase of 0.8% compared to 2002. Excluding the impact of currency exchange rates, net interest expenses would have increased by 14.4%. This increase was primarily caused by banking fees under the credit facilities entered into in March and December 2003 and fees in connection with the extension and amendment of accounts receivable securitization programs at U.S. Foodservice, as well as the higher applicable borrowing rate under the March 2003 credit facility compared with the previous credit facility. These fees amounted to a total of approximately Euro 80 million. The March 2003 credit facility was cancelled and repaid in December 2003, and the company does not expect to draw on the new December 2003 credit facility (other than for letters of credit) during 2004 and beyond. The gain on foreign exchange in 2003 amounted to Euro 14 million and mainly related to the positive impact of the revaluation of the Argentine Peso on U.S. Dollar-denominated debt in Argentina. In 2002, a foreign exchange loss of Euro 50 million was incurred mainly related to the negative impact of the devaluation of the Argentine Peso on U.S. Dollar-denominated debt and inflation adjustment losses related to Argentine Peso-denominated debt in Argentina. Income taxes benefit from release of provisions The effective income tax rate, excluding the impact of non-tax-deductible impairment and amortization of goodwill and exceptional items, decreased to 0.9% in 2003 compared to 36.8% in 2002. Tax Information Apart from the impact of the different geographic mix of income, the substantial reduction of income taxes was caused by: -- Release of tax provisions due to the partial closure of the 1999 - 2001 U.S. tax audit; -- Release of tax provisions due to the closure of a large 1997 - 2002 Dutch tax audit; -- Tax deductible losses as a result of Asian divestments. Share in income (loss) of joint ventures and equity investees Share in income of joint ventures and equity investees in 2003 amounted to Euro 161 million compared to a loss of Euro 38 million in 2002, with 2003 benefiting from a sale and leaseback gain at ICA while 2002 included losses at DAIH which was consolidated as of the third quarter of 2002. US GAAP US GAAP result Net loss in accordance with US GAAP decreased from Euro 4.3 billion in 2002 to a net loss of Euro 747 million in 2003. US GAAP reconciliation The difference between US GAAP and Dutch GAAP of Euro 746 million was mainly caused by the different treatment under US GAAP of assets held for sale (Euro 506 million), and the cumulative effect of the change in accounting principles for certain consideration from vendors (Euro 100 million). Both are non-cash items. Under US GAAP if the expectation is that, more likely than not, an asset will be sold before the end of its estimated useful life, an impairment analysis should be performed. Since it was also concluded that these assets are held for sale, in this impairment analysis the carrying value includes the unrealized cumulative translation adjustment of Euro 582 million, that was previously accounted for in shareholders equity. During 2003 EITF 02-16 "Accounting by a Customer (Including a Reseller) for certain Consideration Received from a Vendor" was adopted for both Dutch and US GAAP. Under Dutch GAAP the cumulative effect adjustment of Euro 100 million was recorded in opening equity, under US GAAP, in accordance with APB Opinion 20, the amount of the cumulative effect was included in the income statement. The full reconciliation of net income in accordance with Dutch GAAP to net income in accordance with US GAAP can be found in Annex C. Improved Balance Sheet Ahold closed 2003 with a much improved balance sheet, with net debt reduced by Euro 4.8 billion. The Euro 2.9 billion rights offering, completed in December, was critical to putting the company on a stronger financial footing. Ahold's financial position also benefited significantly from initiatives to improve cash flow from the business as the working capital improvement program continued to yield positive results, capital expenditures were significantly reduced from 2002 and Ahold completed its first divestments. Balance sheet total Balance sheet total is reduced, reflecting reduced capex, improved working capital and divestments The company has significantly strengthened the balance sheet by increasing equity by Euro 2.2 billion. The company was able to repay its 3% convertible notes of Euro 678 million in September from the cash flow before financing activities. A major event of 2003 was the rights issue, which enabled the company to repay the March 2003 credit facility in December and left the company in a strong liquidity position at year end. The total balance sheet decreased by Euro 1,339 million as a result of lower fixed assets and improved working capital. In 2003 the company selectively invested in the key operating companies in such a way that the overall capital expenditure was lower than depreciation. The balance sheet total was also impacted by the lower U.S. Dollar rate. The cash impact of working capital improvement in 2003 amounted to Euro 446 million compared to Euro 107 million in 2002 and was the result of negotiating better accounts payable terms in Europe and managing the inventory levels at U.S. Foodservice. Equity Equity increased by Euro 2.2 billion The positive liquidity impact from the rights issue was approximately Euro 2.9 billion. This was however off-set by a negative currency impact and other changes of Euro 666 million and an opening balance adjustment of Euro 100 million net of tax resulting from the adoption of EITF 02-16, as outlined in Annex D. Net debt Net debt reduced substantially by Euro 4.8 billion Net debt is substantially impacted by the lower U.S. Dollar to Euro exchange rate. In the fourth quarter Ahold was in compliance with the financial ratios of the covenant of the December 2003 Credit Facility. The ratios consist of Net Debt / EBITDA and EBITDA / net interest expenses. Improved cash flow before financing activities Ahold generated nearly Euro 1.5 billion in net cash flow before financing activities in 2003, underscoring control over capital expenditures, the continued success of working capital initiatives, initial divestments proceeds and curtailing of acquisitions. Net cash before financing activities Net cash flow before financing activities in 2003 increased to Euro 1,461 million compared to a net cash outflow of Euro 107 million in 2002. This increase was including the result of lower net cash outflow related to investing activities of Euro 2,145 million. Net cash from operating activities: working capital improvements offset by lower operating income before impairment and amortization of goodwill and exceptional items Changes in working capital resulted in a cash inflow of Euro 446 million in 2003 mainly due to lower inventory levels at all operating companies, primarily at U.S. Foodservice as a result of focusing on controlling inventory levels and purchases from vendors. Net cash from operating activities in 2003 decreased by Euro 577 million compared to 2002, mainly as a consequence of lower operating income before impairment and amortization of goodwill and exceptional items at U.S. Foodservice and the fees paid to auditors, lawyers, consultants and other costs of approximately Euro 170 million. Net cash from investing activities: lower capital expenditures and acquisitions curtailed Net cash used in investing activities was reduced by Euro 2.1 billion primarily as a result of a reduction in investments in tangible fixed assets of Euro 822 million to Euro 1,183 million in 2003 compared to Euro 2,005 million in 2002. Acquisitions of group companies were limited to Euro 58 million, related to the acquisition of some stores at Stop & Shop, compared to Euro 977 million in 2002. Divestments of tangible and intangible fixed assets amounted to Euro 555 million in the full year 2003 compared to Euro 590 million in 2002. Divestments of subsidiaries contributed an additional Euro 284 million. Net cash from financing activities: rights issue and debt repayment Net cash from financing activities amounted to Euro 1,065 million. This is mainly the result of the proceeds of the shares issue of Euro 2.9 billion. In 2003 the company, among other things, repaid the 3% convertible notes of Euro 678 million from its net operating cash flow in September and further repaid the March 2003 credit facility in December. Segment Information Retail Trade - United States Full Year 2003: Performance Powered by Stop & Shop and Giant- Carlisle Net sales in the U.S. retail trade operations in 2003 increased by 2.7% in U.S. Dollars compared to 2002. Identical sales in U.S. Dollars increased 0.1% and comparable sales in U.S. Dollars increased by 0.9% in 2003 compared to 2002. Stop & Shop and Giant-Carlisle showed strong U.S. Dollar net sales, resulting from comparable store gains, as well as from the opening of stores. Net sales in 2003 were impacted by heightened competition and competitive store openings, particularly in the southeastern United States. Operating income before impairment and amortization of goodwill and exceptional items in the U.S. retail trade business in U.S. Dollars decreased by 10.7% compared to 2002. Operating expenses in the U.S. retail trade business in 2003 were affected by higher administrative expenses and pension expenses, as well as continued rising health care costs. Operating income in U.S. Dollars was relatively flat in 2003 when compared to 2002. Fourth Quarter 2003: Impact of impairment, additional expenses and intense competition Net sales in U.S. Dollars in the U.S. retail trade business increased 0.8% compared to the fourth quarter of 2002. Identical sales in U.S. Dollar declined 0.1% for the U.S. retail trade operations, while both Stop & Shop and Giant-Carlisle showed identical sales growth. Comparable sales increased 0.6% in the fourth quarter of 2003. Operating income before impairment and amortization of goodwill and exceptional items in U.S. Dollars in the fourth quarter of 2003 decreased by 21.9%. Stop & Shop continued its strong performance during the quarter, while Giant-Landover reported a decrease due to heightened competitive activity including pressure from alternative formats. Operating income before impairment and amortization of goodwill and exceptional items at Other USA Retail was significantly impacted by impairment charges relating to long-lived assets of USD 30 million, mainly at Tops, compared to USD 13 million in the fourth quarter of 2002. Also, Other USA Retail was adversely affected in the fourth quarter of 2003 by the intense competition and increased promotional activity, primarily in the southeast. Operating income in U.S. Dollars in the fourth quarter of 2003 increased 33.7% mainly as a result of non-recurring goodwill impairment charges in the fourth quarter of 2002. Retail Trade - Europe Full Year 2003: Competitive pressure in most markets Net sales in the Europe retail operations increased 0.9% compared to 2002. Excluding currency impact in Central Europe, the increase of the net sales in the Europe retail operations would have been 1.7%. Net sales at Albert Heijn in 2003 declined by 1.7% compared to 2002. Identical sales at Albert Heijn in 2003 declined by 2.7% primarily due to lower consumer spending and a negative market sentiment towards Albert Heijn. As a result, Albert Heijn introduced its price repositioning strategy in October 2003 and regained market share in the fourth quarter. Net sales at other Europe retail trade operations in 2003 increased by 2.9% compared to 2002, primarily due to strong net sales growth at Schuitema and an increase in net sales in Central Europe and Spain. The increase in net sales was marginally offset by the divestments of Ahold's specialty stores (Jamin and De Tuinen) in The Netherlands, which were completed in the second quarter of 2003. In Central Europe and Spain, net sales increased due to the opening of new stores. Net sales in Central Europe, however, were negatively impacted by currency exchange rates, deflation and the sale of two hypermarkets in Poland. Operating income before impairment and amortization of goodwill and exceptional items in the Europe retail trade operations decreased 28.4% primarily due to lower operating income at Albert Heijn. This was principally caused by lower net sales during the first three quarters, lower gross margins due to the price repositioning strategy and costs relating to its restructuring program. Operating income before impairment and amortization of goodwill and exceptional items at other Europe retail trade operations in 2003 decreased compared to 2002 mainly as a result of increased costs related to new stores and lower real estate gains. The operating income before impairment and amortization of goodwill and exceptional items in Spain was at the same level as in 2002. Operating income returned from a loss of Euro 654 million in 2002 to a profit of Euro 188 million in 2003 because of the significant decrease in goodwill impairment charges in 2003 compared to 2002. Fourth Quarter 2003: Albert Heijn price repositioning strategy leads to market share gains Net sales in the fourth quarter of 2003 slightly decreased by 0.5% and 0.7% if excluding currency impact. Albert Heijn recovered market share but reported lower net sales. Identical sales fell 1.5% in the fourth quarter in 2003. The lower net sales at other Europe retail trade operations were the result of lower net sales in Spain. Operating income before impairment and amortization of goodwill and exceptional items decreased in 2003 by 32.9% compared to 2002. Operating income before impairment and amortization of goodwill and exceptional items at Albert Heijn in the fourth quarter of 2003 decreased compared to the same period in 2002. The decrease was primarily due to lower net sales and gross margins partially offset by lower operating expenses. The price repositioning strategy resulted in Albert Heijn regaining market share in the fourth quarter. Operating income before impairment and amortization of goodwill and exceptional items at other Europe retail trade operations decreased in the fourth quarter of 2003, compared to the fourth quarter of 2002. This decrease was primarily due to an operating loss at Schuitema as a result of, amongst others, fixed asset impairments. In Central Europe, the company reported operating income before impairment amortization of goodwill and exceptional items turning to a positive result, since no further impairment on long-lived assets was needed. Spain reported a lower operating loss before impairment and goodwill amortization of goodwill and exceptional items in the fourth quarter of 2003 primarily due to lower impairments on long-lived assets. Operating income in the fourth quarter of 2003 increased from a loss of Euro 820 million to a profit of Euro 44 million primarily because of the significant decline of goodwill impairment charges in 2003 compared to 2002. Foodservice Foodservice - United States Full Year 2003: Sharp loss of profitability at U.S. Foodservice Net sales at U.S. Foodservice increased by USD 402 million, or 2.3%, in 2003 compared to net sales in 2002. The acquisition of Allen Foods in December 2002, and certain assets of Lady Baltimore in September 2002, contributed approximately 1.3% of the net sales growth. Excluding acquisitions and the increase in food price inflation as estimated by the company, net sales would have slightly declined in 2003. An operating loss before impairment and amortization of goodwill and exceptional items of USD 74 million was incurred in 2003 compared to income of USD 292 million in 2002. This was primarily due to U.S. Foodservice experiencing a weakening of its procurement leverage as vendors raised prices and shortened payment terms, largely related to irregularities announced and investigations conducted in 2003. U.S. Foodservice also experienced higher operating costs. Operating loss was in line with the operating loss before impairment and amortization of goodwill and exceptional items since the goodwill amortization was at the same level in 2003 as in 2002. Foodservice - Europe: Economic pressures Net sales at the Deli XL food service operations, located in The Netherlands and Belgium, in 2003 decreased by 3.8% compared to 2002. This decrease was primarily due to continuing unfavorable market conditions. As a result operating income at the European food service operations in 2003 decreased by 25.0% compared to 2002. Fourth Quarter 2003: strong sales Net sales of U.S. Foodservice in U.S. Dollars in the fourth quarter increased by 6.0%. Operating income before impairment and amortization of goodwill and exceptional items of U.S. Foodservice in the fourth quarter of 2003 benefited significantly from the release of previously, in 2003, accrued employee benefits. Other Business Areas: Divestment program underway Retail Trade - South America Net sales in the South America retail trade operations in 2003 increased by 3.5% compared to 2002. This increase was mainly due to the full-year consolidation in 2003 of Disco, which began to be consolidated in the second quarter of 2002. This increase was partially offset by the impact of the divestment of Santa Isabel's Chilean and, to a lesser extent, Paraguayan and Peruvian operations in July, September and December 2003, respectively. The operating loss before impairment and amortization of goodwill and exceptional items in 2003 was the result of the general economic depression in South America and vendors' reaction to the announcements of Ahold's divestments in the region. Retail Trade - Asia Pacific Net sales in the Asia Pacific retail trade operations in 2003 amounted to Euro 364 million, a decrease of 20.5% compared to 2002. This decrease was primarily due to the divestment of our operations in Malaysia and Indonesia completed in September 2003 and a decline in net sales in Thailand of 6.9% fully due to a currency exchange rate impact of the Thai Baht compared to the Euro. Operating loss before impairment and amortization of goodwill and exceptional items in the Asia Pacific retail trade operations in 2003 amounted to Euro 16 million, compared to an operating loss of Euro 31 million in full year 2002. This was primarily due to the divestment of operations in Malaysia and Indonesia, as well as performance improvement in Thailand. Other Activities Other activities mainly include operations of three real estate companies which acquire, develop and manage store locations in Europe and the United States and corporate overhead costs of the Ahold parent company. The operating loss before impairment and amortization of goodwill and exceptional items in 2003 partially reflected corporate costs of Euro 263 million compared to Euro 33 million in 2002. The higher corporate costs in 2003 were mainly caused by the significant costs incurred in connection with the forensic accounting and legal investigations, ongoing litigation, ongoing government and regulatory investigations and higher audit fees in connection with the audit of the 2002 financial statements (approximately Euro 130 million). Furthermore, corporate costs increased as a result of an additional contribution to the loss reserve of the self insurance program in the U.S. (Euro 45 million). Gains from the sale of real estate included in other activities were at the same level in 2003 compared to 2002. Operating loss of the total other business areas decreased from a loss of Euro 678 million in 2002 to a loss of Euro 422 million in 2003. The exceptional items were reduced from Euro 372 million in 2002 to Euro 136 million in 2003. The exceptional loss in 2003 relates primarily to the losses of the Chilean and Malaysian divestments, with regards to the foreign currency translation adjustment and goodwill reversals which do not impact equity. Goodwill impairment reduced from Euro 271 million in 2002 to Euro 42 million in 2003. Share in Income (Loss) of Joint Ventures and Equity Investees The share in income of joint ventures and equity investees in 2003 amounted to Euro 161 million, compared to a loss of Euro 38 million in 2002. This was primarily caused by the inclusion in this line item for 2002 of a Euro 126 million loss at DAIH, until it began to be consolidated beginning in the third quarter of 2002. The share in income of ICA, included in European joint ventures, increased considerably in 2003 mainly as a result of a gain related to the sale and leaseback of several distribution centers. The loss at DAIH reflected the losses incurred at Disco and Santa Isabel during the period that they were not consolidated in the financial statements. The loss at DAIH was mainly caused by the negative impact of the devaluation of the Argentine Peso on U.S. Dollar-denominated debt. 2004: A Year of Transition General 2004 will be a year focused on continued efforts to strengthen the organization, and restructure and integrate the businesses in order to build a solid platform for future growth and profitability. Management will concentrate on achieving the previously announced Road to Recovery performance objectives for 2005 and beyond. Ahold will continue to strengthen and improve its internal controls and corporate governance, as well as solidify compliance with the regulatory environment in 2004. All of these changes are important cornerstones of our Road to Recovery strategy. They will require considerable resources and effort from our operations and corporate support office in 2004. Retail operations will continue to face increased competition and price pressure. On the other hand, Ahold expects healthy sales development in the foodservice sector. US retail Net sales growth in U.S. retail operations in 2004 is expected to be only modest as a result of continued competitive pressure. One of the key efforts in the U.S. for 2004 will be the integration of Stop & Shop and Giant-Landover, which will improve the long-term competitiveness and cost-effectiveness of these brands. This integration will require an initial investment during 2004, but will result in significant benefits in 2005 and beyond. At Tops we continue to focus on repositioning its 'go to market strategy' and improving its operational performance. The intended divestment in 2004 of BI-LO/Bruno's is expected to negatively impact net sales in 2004. Europe retail Ahold expects net sales in its Europe retail operations to increase in 2004 in a generally tough environment with weak economies, consumer focus on price, and increased competition. There will be a continued focus on efficiency and competitiveness in Europe. The planned divestment of our Spanish operations in 2004 will reduce European net sales. Foodservice Market conditions, in particular in the U.S., are expected to be favorable for the foodservice industry. However, increasing fuel costs and food commodity prices may have a negative effect on industry pricing and competitiveness. It is possible that net sales may experience a small reduction in 2004 at U.S. Foodservice, as a result of an effect of improved customer mix specifically related to certain national accounts. Operating income before impairment and amortization of goodwill and exceptional items is expected to be positive for 2004 and exceed the level of 2002, no later than 2006. Capital expenditures and working capital Capital expenditures will continue to be made strategically and will increase from the low levels of 2003 to approximately depreciation level. Investments will be focused on the growth of our food retail business. Initiatives to improve working capital started in 2003 and will be continued with expected further improvements in 2004. Net cash from operations is expected to improve. Finance and Tax Further reduction of net finance expense in 2004 is expected as a result of lower fees for our new credit facility and lower net interest expenses due to the continued reduction of net debt. Ahold expects its tax position to normalize during 2004, with a rate marginally above 30%. Net Debt The continued recovery and development of our operations together with the on-going divestment program is expected to lead to further reductions of net debt (excluding currency impact) in line with our objectives to reach investment grade profile by the end of 2005. Divestments and Other Issues The clearly improved financial position and liquidity gives us the platform to manage our divestment in an orderly fashion, i.e. no need for 'fire-sales'. The company plans to have divested its remaining operations in South America and Spain, as well as BI- LO/Bruno's and the remaining convenience stores at Tops in the United States, by the end of 2004. As announced in March 2004, Ahold completed the divestment of its stake in CRC Ahold in Thailand, and thus its exit from the Asia Pacific region. However, exceptional items are expected upon completion of the divestitures of certain South American operations as well as the divestment of BI-LO/Bruno's. The completion of these divestitures will lead to the recognition of accumulated foreign currency translation adjustments (CTA) in the statement of operations as well as in some cases the reversal of goodwill, both previously charged to shareholders' equity. The cumulative exchange rate differences charged to shareholders' equity for these operations at the beginning of 2004 amounted to Euro 648 million. The aggregate amount of goodwill that would have been required to be reversed if these operations had been divested at the beginning of 2004 would have been Euro 309 million. The net consequence of this is a significant exceptional loss in our statement of operations with an identical positive adjustment to net equity. These likely exceptional items will have a significant impact on net income, but no net impact on equity and are non-cash items. Operating expenses in 2004 will also be significantly impacted by a number of factors, in particular costs related to the ongoing legal proceedings and governmental and regulatory investigations, including possible fines or judgements that may be levied or awarded. Initiatives underway to enable the company to begin reporting under International Financial Reporting Standards, as required for 2005, and ongoing work to comply with the internal controls requirements of Section 404 of the U.S. Sarbanes-Oxley Act, required to be completed by the end of fiscal year 2005, will also have an impact. In summary, 2004 will be a year of execution and transition for Ahold and has to be seen as an important step on its Road to Recovery, which is well on track for continued progress beyond 2004. * * * As previously reported, Fitch Ratings, the international rating agency, assigned Netherlands-based food retailer Koninklijke Ahold NV a Stable Rating Outlook while removing it from Rating Watch Negative. At the same time, the agency affirmed Ahold's Senior Unsecured rating at 'BB-' (a speculative rating indicating that there is a possibility of credit risk developing, particularly as the result of adverse economic change over time; however, Fitch says, business or financial alternatives may be available to allow financial commitments to be met) and its Short-term rating at 'B' (Fitch's speculative rating, indicating minimal capacity for timely payment of financial commitments, plus vulnerability to near-term adverse changes in financial and economic conditions). The Stable Outlook reflects the benefits from the shareholder approval, granted on Wednesday, for a fully underwritten EUR3billion rights issue. Ahold however continues to face financial and operational difficulties which have been reflected in the Q303 results. Ahold announced in early November its strategy for reducing debt through its EUR3bn rights issue and EUR2.5bn of asset disposals as well as improving the trading performance of its core retail and foodservice businesses. Whilst the approved rights issue addresses immediate liquidity concerns, operationally, the news is less positive with Ahold's core Dutch and US retail operations both suffering from increased competition, mainly from discounters, resulting in operating profit margin erosion. Ahold's European flagship operation, the Albert Heijn supermarket chain in the Netherlands, recently reported both declining sales and profits, as consumers turn to discount retailers. In reaction to this, Albert Heijn, has amended its pricing structure which in turn would suggest that it will be more challenging in the future to match historic operating margin levels. AMERICAN SPORTS: Brings-In TRG Inc. as Financial Advisor -------------------------------------------------------- American Sports International, Ltd., sought and obtained permission from the U.S. Bankruptcy Court for the Northern District of Georgia, Rome Division, to employ and retain TRG, Inc., as their crisis manager and financial advisor in its Chapter 11 proceeding. TRG will provide: a) financial analysis of the Debtors' current and potential profitability, ongoing cash requirements and break-even levels; b) assistance in the Debtors' relationship with their lenders and creditors; c) general financial advice as it pertains to the Debtors' proceeding as contemplated herein; and d) any and all matters associated with this assignment. Michael J. Epstein reports that TRG will charge its hourly billing rates, which range from: Staff Classification Billing Rate -------------------- ------------ Principal $425 - $475 per hour Managing Director $350 - $395 per hour Director $250 - $325 per hour Consultant $175 - $250 per hour Analyst $110 - $175 per hour Headquartered in Jefferson, Iowa, American Sports International, Ltd. -- http://www.americanathletic.com/-- offers a variety of products including gymnastics apparatus, athletic mats, custom padding, basketball equipment, volleyball equipment, and divider curtains. The Company filed for chapter 11 protection on March 17, 2004 (Bankr. N.D. Ga. Case No. 04-41108). Jason H. Watson, Esq., John C. Weitnauer, Esq., and Troy J. Aramburu, Esq., at Alston & Bird LLP represent the Debtors in their restructuring efforts. When the Company filed for protection from their creditors, they listed both estimated debts and assets of over $10 million. AURORA FOODS: Miller Buckfire Asks $6 Million Compensation ---------------------------------------------------------- Miller Buckfire Lewis Ying & Co., LLC asks Judge Walrath to allow: -- $6,600,000 as compensation for services rendered from December 8, 2003 through March 19, 2004; and -- $21,615 as expense reimbursement. The firm also asks the Court to direct the Aurora Foods Debtors to pay Miller Buckfire all allowed and unpaid fees and expenses totaling $1,271,615, which represents $1,250,000 in fees and $21,614.72 in expenses. Miller Buckfire seeks compensation for these professionals who devoted a total of 346 hours: Professional Title Hours Worked ------------ ----- ------------ David Ying Managing Director 45.9 Derex Walker Principal 145.8 Roopesh Shah Principal 33.9 Jared Golub Associate 63.0 Sheetal Acherekar Analyst 57.4 ----- 346 According to Miller Buckfire Principal Derek Walker, the 346 hours were devoted to these projects: Project Hours Worked ------- ------------ Case Administration 119.2 MBLY Retention Issues 46.9 Travel 28.5 Due Diligence 4.5 Restructuring Plan 102.0 Business Plan & Strategy 0.4 Expert Testimony 38.5 Officer & Director Issues 3.0 Creditor Contacts 2.5 Employee Severance and Retention 0.5 ------ 346.0 The firm's out-of-pocket expenses are itemized as: Expenses Amount -------- ------ Travel $552.20 Hotel 1,686.70 Meals 713.08 Car Service/Taxi 2,311.63 Telephone 1,109.09 Messenger 42.00 Research 3,003.99 Presentation Support 1,674.53 Legal 10,521.50 --------- $21,614.72 Aurora Foods Inc. -- http://www.aurorafoods.com/-- based in St. Louis, Missouri, produces and markets leading food brands, including Duncan Hines(R) baking mixes; Log Cabin(R), Mrs. Butterworth's(R) and Country Kitchen(R) syrups; Lender's(R) bagels; Van de Kamp's(R) and Mrs. Paul's(R) frozen seafood; Aunt Jemima(R) frozen breakfast products; Celeste(R) frozen pizza; and Chef's Choice(R) skillet meals. With $1.2 billion in reported assets, Aurora Foods, Inc., and Sea Coast Foods, Inc., filed for chapter 11 protection on December 8, 2003 (Bankr. D. Del. Case No. 03-13744), to complete a pre-negotiated sale of the company to J.P. Morgan Partners LLC, J.W. Childs Equity Partners III, L.P., and C. Dean Metropoulos and Co. Judge Walrath confirmed the Debtors' pre-packaged plan on Feb. 20, 2004. Sally McDonald Henry, Esq., and J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP provide Aurora with legal counsel, and David Y. Ying at Miller Buckfire Lewis Ying & Co., LLP provides financial advisory services. (Aurora Foods Bankruptcy News, Issue No. 11; Bankruptcy Creditors' Service, Inc., 215/945-7000) B&G FOODS: S&P Places B-Level Credit Rating on Watch Negative ------------------------------------------------------------- Standard & Poor's Ratings Services placed its ratings on diversified food products company B&G Foods Inc., including its 'B+' corporate credit rating, on CreditWatch with negative implications. Negative implications means that the ratings could be lowered or affirmed following Standard & Poor's review. The CreditWatch placement follows the recent S-1 filing by B&G Foods stating that it plans to issue Enhanced Income Securities (EIS), which comprise class A common stock and senior subordinated notes. "Based on its preliminary review, Standard & Poor's believes that the EIS structure, in general, exhibits a more aggressive financial policy for B&G Foods than that currently factored into the rating," said Standard & Poor's credit analyst Ronald Neysmith. Though the amount of debt outstanding would change little after the EIS offering, B&G Foods will have significantly reduced its financial flexibility given the anticipated high dividend payout rate. As a result, the structure limits the company's ability to withstand potential operating challenges and also reduces the likelihood for future deleveraging. A further risk is that the debt portion of the EIS may not be treated as debt for U.S. federal income tax purposes by the IRS. If all or part of the subordinated notes are treated as equity rather than debt, then the interest on the subordinated notes will not be deductible by B&G Foods. This could make the EIS securities uneconomic and expose the company to refinancing risk and a claw- back of previous years' liability (there is generally a three-year limit on such a claw-back). Following the completion of the Securities & Exchange Commission's review, Standard & Poor's will resolve its CreditWatch. B&G is a manufacturer, marketer, and distributor of a diversified portfolio of food products, including branded pickles, peppers, taco shells, salsa, hot sauces, maple syrup, salad dressing, and other specialty food products. B&G's acquisition strategy includes buying solid niche brands that possess either No. 1 or No. 2 positions within their categories. BIDDLE-ASHLAND: Gets OK to Employ Heneson as Bankruptcy Counsel --------------------------------------------------------------- Biddle-Ashland I, LLC sought and obtained approval from the U.S. Bankruptcy Court for the District of Maryland, Baltimore Division, to employ Howard M. Heneson, Esq., and his law firm, as their attorneys. The Debtor selected Mr. Heneson because of his experience in bankruptcy and reorganization matters. As Counsel, Mr. Heneson will: a) investigate and advise the Debtor with regard to its rights in this bankruptcy proceeding; b) represent the Debtor's interests in this Bankruptcy proceedings; c) investigate and advise the Debtor as to the potential ways to reorganize the Debtor's affairs and attempt, if appropriate, to discover potential assets in this proceeding; and d) do all of those duties appropriate to representing the Debtor in this proceeding. Prior to this engagement, the Debtor consulted with Mr. Heneson and paid a $2,000 retainer on March 26, 2004. For postpetition services, Mr. Heneson will receive a $10,000 retainer. Headquarter in Baltimore, Maryland, Biddle-Ashland I, LLC operates a real estate rental and development company. The Company filed for chapter 11 protection with its affiliate, Biddle-Ashland II, LLC on March 29, 2004 (Bankr. D. Md. Case No. 04-17669). Howard M. Heneson, Esq., at Christman & Fascetta represent the Debtors in their restructuring efforts. When they filed for protection from its creditors, Biddle-Ashland I, LLC lists $12,004,600 in assets and $6,465,800 in debts; Biddle-Ashland II, LLC reports $1,032,500 in assets and $6,443,000 in debts. BRIDGEPORT METAL: Section 341(a) Meeting Slated for May 3, 2004 --------------------------------------------------------------- The United States Trustee will convene a meeting of Bridgeport Metal Goods Manufacturing Co.'s creditors at 11:00 a.m., on May 3, 2004 in the Bankruptcy Meeting Room at One Century Tower, 265 Church Street, Suite 1104, New Haven, Connecticut 06510-7017. This is the first meeting of creditors required under 11 U.S.C. Sec. 341(a) in all bankruptcy cases. All creditors are invited, but not required, to attend. This Meeting of Creditors offers the one opportunity in a bankruptcy proceeding for creditors to question a responsible office of the Debtor under oath about the company's financial affairs and operations that would be of interest to the general body of creditors. Headquartered in Bridgeport, Connecticut, Bridgeport Metal Goods Manufacturing Co. -- http://www.bmgmfg.com/-- is engaged in the business of manufacturing, decorating and assembling plastic cosmetic containers and packaging products. The Company filed for chapter 11 protection on March 30, 2004 (Bankr. D. Conn. Case No. 04-50412). Irve J. Goldman, Esq., and Jessica Grossarth, Esq., at Pullman & Comley represent the Debtor in their restructuring efforts. When the Company filed for protection from its creditors, it listed both estimated debts and assets of over $10 million. CABLE DESIGN: S&P Lowers Corporate Credit Rating to BB- ------------------------------------------------------- Standard & Poor's Ratings Services lowered its 'BB' corporate credit rating on Cable Design Technologies Corp. (to be renamed Belden CDT Inc. following the completion of the proposed merger with St. Louis, Missouri-based Belden Inc.) to 'BB-', and lowered its subordinated debt rating on $110 million of convertible notes of Cable Design Technologies to 'B' from 'B+'. At the same time, Standard & Poor's removed its ratings on CDT from CreditWatch, where they were placed on Feb. 5, 2004, after announcement of the merger. The outlook is stable. "The newly merged company will have annual revenues of approximately $1 billion and significant market positions in both data networking cables and connectivity products, used in communications and computer networks, and in specialty electronic wire and cable products," said Standard & Poor's credit analyst Joshua Davis. In tandem with the merger, Belden will sell portions of its North American copper telecommunications wire business to Superior Essex Inc. for $95 million of cash. Belden CDT will have approximately $316 million of funded debt outstanding at the close of the merger. The ratings on Belden CDT reflect the company's participation in highly competitive, cyclical and low-return wire and cable markets, partially offset by solid positions in segments of the relatively more value-added specialty electronic wire segments, greater scale and broader market presence following the merger and a moderate financial profile for the rating. Belden CDT's position in specialty electronic wire and cable, which is expected to account for 60% of the company's revenues, provides ratings support. The company's presence across a range of specialty product lines, including aerospace/aviation, automobiles, broadcast/entertainment, and safety and security, provide relatively stable revenues and profitability, with EBITDA margins exceeding 10%. Risks in this segment are concentrated in Belden CDT's European operations, some of which do not enjoy the same market position and profitability as the company's North American businesses. Furthermore, both the specialty and networking segments are at risk from rising materials costs, particularly copper, which have experienced sharp price increases over the past year. CALPINE: First Quarter 2004 Earnings Conference Call is on May 6 ---------------------------------------------------------------- Calpine Corporation (NYSE: CPN), a leading North American power company, will announce its first quarter 2004 financial results on May 6, 2004. The company has scheduled a conference call to discuss its financial and operating results for the three months ended March 31, 2004. The call will take place on Thursday, May 6, 2004, at 8:30 a.m. PDT, and can be accessed via a web cast on Calpine's Investor Relations page, http://www.calpine.com/or by dialing 1-888-603-6685 (706-634-1265 for international callers) at least five minutes before the start of the call. A replay and transcript of the conference call will be available for 30 days on Calpine's Investor Relations page at http://www.calpine.com/ Calpine Corporation (S&P, CCC+ Senior Unsecured Convertible Note and B Second Priority Senior Secured Note Ratings, Negative Outlook), celebrating its 20th year in power in 2004, is a leading North American power company dedicated to providing electric power to customers from clean, efficient, natural gas- fired and geothermal power facilities. The company generates power at plants it owns or leases in 21 states in the United States, three provinces in Canada and in the United Kingdom. Calpine is also the world's largest producer of renewable geothermal energy, and owns or controls approximately one trillion cubic feet equivalent of proved natural gas reserves in the United States and Canada. For more information about Calpine, visit http://www.calpine.com/ CANADA PAYPHONE: Intends to File BIA Plan Proposal on May 7, 2004 ----------------------------------------------------------------- Subsequent to a Press Release dated April 8, 2004, announcing the decision to file a Notice of Intention to make a proposal for the benefit of its creditors under the Bankruptcy and Insolvency Act (Canada) and to appoint Appel & Co. Inc., member of Horwath International, as trustee, Canada Payphone Corporation is confirming receipt of the accepted "Notice of Intention to file a proposal" and that such application dated April 08, 2004, has been received from the office of the Superintendent of Bankruptcy granting the Company protection. Unless an extension is required, the Company will file its restructuring plan proposal no later then May 7, 2004, and a creditors meeting will be scheduled within 21 days of the filing of the proposal. The effect of the restructuring plan on the existing shareholders is uncertain at this time. Canada Payphone Corporation is listed on the TSX Venture Exchange and is listed as CPY. COLE NATIONAL: S&P Revises CreditWatch Implications to Developing ----------------------------------------------------------------- Standard & Poor's Ratings Services revised its CreditWatch implications on the ratings for Cole National Group Inc. (including the 'BB-' corporate credit rating) to developing from positive. The CreditWatch revision follows the announcement that Cole National Corp., the parent of Cole National Group, has received an unsolicited acquisition offer from Moulin International Holdings (unrated) to acquire Cole National for about $450 million. About $275 million in rated debt is affected. The proposal contemplates that HAL Holding N.V., which owns about 19.2% of Cole National's outstanding shares, will provide substantial financing for the transaction, including the purchase of certain assets of Cole National at the closing of the proposed merger. In January 2004, Cole National entered into a merger agreement with Luxottica Group S.p.A. (unrated), under which Luxottica would acquire the company for about $400 million. Luxottica has neither amended nor removed its offer at the current time. Standard & Poor's will monitor the developments of the proposed offers. The CreditWatch listing reflects the possibility that ratings could be raised or lowered based on the credit profile of the acquiring company. CONSECO INC: S&P Places Low-B & Junk Ratings on Watch Positive -------------------------------------------------------------- Standard & Poor's Ratings Services placed its 'B-' counterparty credit, 'B-' senior debt, and 'CCC-' preferred stock ratings on Conseco Inc. on CreditWatch with positive implications. At the same time, Standard & Poor's placed its 'BB-' counterparty credit ratings and financial strength ratings on Bankers Life & Casualty Co., Colonial Penn Life Insurance Co., Conseco Insurance Co., Conseco Health Insurance Co., Conseco Life Insurance Co., and Conseco Life Insurance Co. of NY on CreditWatch with positive implications. "The CreditWatch reflects the expected issuance by Conseco Inc. of $1 billion of new common equity by early May 2004," said Standard & Poor's credit analyst Jon Reichert. Not affected by this CreditWatch action are the ratings on Conseco Senior Health Insurance Co., which remain on CreditWatch negative where they were placed Nov. 19, 2003. "Proceeds from the common equity issuance, in conjunction with proceeds from an expected $500 million issuance of mandatory convertible preferred stock and $900 million of new bank debt, are expected to be used to refinance the existing $1.3 billion of outstanding bank debt, redeem the outstanding $900 million of convertible exchangeable preferred stock, and make a capital contribution to the insurance subsidiaries," Mr. Reichert added. "Because of this recapitalization, Conseco Inc. is expected to have a capital structure with less onerous debt service payments than currently exists, allowing for greater fixed-charge coverage that should be supportive of higher ratings at the holding company as well as at the insurance subsidiaries." If the ratings are upgraded, it is expected that the senior debt rating on Conseco Inc. will go no higher than 'BB-', the preferred stock rating will go no higher than 'B-', and the financial strength will go no higher than 'BB+'. Assuming a successful recapitalization of the holding company, the ratings constraint for Conseco will shift from being the holding company's capital structure to being the insurance operations. At this time, Standard & Poor's believes it is too early to consider Conseco's insurance operations to be investment grade largely due to the uncertainty regarding the company's future competitive position. Although financial results have been generally positive since Conseco Inc.'s emergence from bankruptcy in September 2003, Standard & Poor's believes it will take an additional two to four quarters of actual results to determine how effective management has been at reattracting the independent agent force to sell Conseco products, and if the products are priced appropriately to deliver sufficient statutory earnings to generate the capital needed to fund additional growth. DESERT VIEW LLC: Case Summary & 5 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Desert View, LLC 1160 Paseo De Majescad Calexico, California 92231 Bankruptcy Case No.: 04-03291 Chapter 11 Petition Date: April 9, 2004 Court: Southern District of California (San Diego) Judge: Louise DeCarl Adler Debtor's Counsel: James N. Maynard, Esq. Law Offices of James N. Maynard 2683 Via De La Valle, Suite 326 Del Mar, CA 92014 Tel: 858-792-3789 Estimated Assets: $1 Million to $10 Million Estimated Debts: $500,000 to $1 Million Debtor's 5 Largest Unsecured Creditors: Entity Nature Of Claim Claim Amount ------ --------------- ------------ Gibson & Schaefer, Inc. Trade $2,835 NationsRent Trade $1,592 Landmark Trade $792 BJ Engineering & Survey Inc. Trade $600 I.V. Recycling, Inc. Trade $192 ELITE MODEL: Carl Marks Capital to Sell 'Supermodel' Agency ----------------------------------------------------------- Carl Marks Capital Advisors LLC, part of the 79-year-old merchant bank Carl Marks & Co, has been retained to sell Elite Model Management Corporation, the famous agency that created "supermodels" in the '80s and '90s. Elite filed for Chapter 11 bankruptcy protection in February in the U.S. Bankruptcy Court for the Southern District of New York. John Casablancas opened the Elite Agency in Paris in 1972 and Elite New York in 1974. The agency created the supermodel category - and supermodels such as Cindy Crawford, Claudia Schiffer, Naomi Campbell and Nastassja Kinkski - through its Elite Model System. A number of current Hollywood actresses such as Brooke Shields, Demi Moore and Cameron Diaz also started their careers at Elite. "Though the agency has experienced recent financial difficulty, it is a strong, prestigious brand," said CMCA partner Mark L. Claster, "with representation throughout the United States in Los Angles, Chicago, Atlanta and Miami in addition to New York. Our extensive experience in helping to revitalize companies should be particularly useful to Elite. The Carl Marks organization has also been involved in more than 300 M&A transactions since the '60s - experience we will apply to Elite." Carl Marks Capital Advisors LLC focuses on offering sophisticated financial advisory services to middle market companies. Carl Marks Consulting Group LLC is a full-service advisory firm, dedicated to helping businesses effectively manage change and strengthen their organizations for long-term success. Both Carl Marks Capital Advisors LLC and Carl Marks Consulting Group LLC are affiliates of Carl Marks & Co, a leading merchant bank founded in 1925 in New York. EMAGIN CORPORATION: George Haywood Has 6.1% Equity Stake -------------------------------------------------------- George W. Haywood beneficially owns 3,966,765(1) shares of eMagin Corporation's common stock with sole voting and dispositive powers. The amount held represents 6.1% of the outstanding common stock of eMagin. (1) The amount shown above does not include an aggregate of 3,203,187 shares of common stock issuable upon exercise of warrants held by Mr. Haywood. Such warrants are not exercisable to the extent that after giving effect to such exercise Mr. Haywood would beneficially own more than 4.99% of the outstanding shares of common stock of eMagin Corporation. Accordingly, Mr. Haywood does not currently beneficially own the shares of common stock underlying such warrants. eMagin is a developer and manufacturer of optical systems and microdisplays for use in the electronics industry. eMagin's wholly-owned subsidiary, Virtual Vision Inc., develops and markets microdisplay systems and optics technology for commercial, industrial and military applications. The company's Dec. 31, 2003, balance sheet discloses a net capital deficiency of about $4.7 million. ENRON CORP: Objects to 54 Late-Filed Hazelwood Claims ----------------------------------------------------- Beginning on June 30, 2003, and long after the applicable Bar Date, the Hazelwood Heirs filed 54 Proofs of Claim totaling $579,184,397,746 plus an unliquidated amount against the Enron Corporation Debtors. The Hazelwood Heirs asserts that they are entitled to recover from Enron for goods and services performed from 1935 to 2003 for royalties related to gas and oil leases from land located in Cass County, Texas. The Debtors have searched their records and cannot identify any creditor having the name of any of the Hazelwood Heirs, or any other basis for the claims belatedly asserted against the Debtors. Although sufficient supporting documentation is not attached to substantiate the Claims, three of the 54 Claims contain some information that these proofs of claim ware virtually identical to certain proofs of claim filed in the EOTT Energy Partners LP case by the Hazelwood Heirs. The Debtors can only assume that the remaining 51 Claims allege the same basis as the three Claims. From the documentation and the adjudication of the Hazelwood Heirs claims in the EOTT cases, Melanie Gray, Esq., at Weil, Gotshal & Manges LLP, in New York, points out that it is clear that whatever claims the Hazelwood Heirs may have thought they had, those claims were against EOTT, not against any of the Debtors in these cases. Accordingly, the Debtors ask the Court to expunge the Hazelwood Heirs Claims because they: (i) were filed after the Bar Date; (ii) were not reflected in any way in the Debtors' books and records; (iii) did not include sufficient supporting documentation to establish the basis of the Claims; (iv) appear to relate to a claim against EOTT that has already been adjudicated; and (v) are barred by the statute of limitations. (Enron Bankruptcy News, Issue No. 104; Bankruptcy Creditors' Service, Inc., 215/945-7000) ENRON CORPORATION: Inks Stipulation Reducing GE Capital's Claim --------------------------------------------------------------- Pursuant to the Enron Debtors and GE Capital's Stipulation, the Surplus Collateral under the Schedule No. 1 Collateral was abandoned by Enron. The Surplus Collateral located at the Navigation Street Warehouse has been sold or disposed of by or on behalf of GE Capital and the Texas Taxing Authorities subsequent to Enron's abandonment. The Stipulation provides, inter alia, that the Surplus Collateral located on unused floors of Enron Center North may remain at its present location until December 31, 2003 without any liability of GE Capital or the Surplus Collateral for rent or storage costs. Pursuant to the 2001 Agreement, GE Capital extended $14,198,051 to refinance the Schedule No. 1 Collateral. Prior to the Petition date, Enron made $952,787 in principal repayments to GE Capital with respect to the Schedule No. 1 Financing. Subsequent to the Petition Date, Enron made $1,858,134 in adequate protection payments with respect to the Schedule No. 1 Collateral. The gross proceeds from an Auction received from the sale of the Surplus Collateral located at the Navigation Street Warehouse are $245,000. Pursuant to the Stipulation between General Electric Capital Corporation and Certain Texas Taxing Authorities, dated August 6, 2003, at least 50% of the Auction Proceeds must be used to satisfy the liens of GE Capital and not the liens asserted by Harris County, City of Houston, Houston Independent School District and Houston Downtown Management District. The parties estimate that the value of the remaining Schedule No. 1 Collateral that Enron continues to retain is $350,000, which the parties have considered as received by GE Capital in determining the remaining indebtedness of Enron with respect to the Schedule No. 1 Financing. The total payments GE Capital received with respect to the Schedule No. 1 Financing are $2,810,921, and the combined total of the Auction Proceeds and Retained Collateral is $595,000. Enron's remaining indebtedness with respect to the Schedule No. 1 Financing is $10,914,630, which the parties have agreed to compromise in the amount of $10,800,000. GE Capital asserts that it is entitled to an administrative expense claim against Enron as a result of certain alleged breaches by Enron under prior stipulations between Enron and GE Capital and alleged damage to the Schedule No. 1 Collateral. Enron disputes GE Capital's assertions. Following discussions among representatives of GE Capital and Enron, the parties have agreed to fix the amount of Enron's remaining indebtedness with respect to the Schedule No. 1 Financing, fix the amount of GE Capital's claim relating to the 2001 Agreement, and avoid the costs of further litigation and risks attendant thereto by resolving the dispute between them upon the terms and conditions set forth in this Stipulation. With Judge Gonzalez's approval, the Debtors and GE Capital agree: 1. Allowance of Claim GE Capital's Proof of Claim No. 12814 is amended and allowed as: (a) Secured Claim with respect to Schedule Nos. 2 and 3. Pursuant to the January 16 Stipulation GE Capital's secured claim with respect to the GE Collateral identified in Schedule Nos. 2 and 3 has been satisfied; (b) Unsecured Claim with respect to Schedule Nos. 2 and 3. GE Capital's unsecured claim with respect to the GE Collateral identified in Schedule Nos. 2 and 3 is unaffected by this Stipulation and remains allowed in full as a general unsecured claim of $1,703,025 pursuant to the January 16 2002 Stipulation; (c) Secured Claim with respect to Schedule No. 1. GE Capital has a secured claim with respect to Schedule No. 1 for $595,000, which claim is allowed in full and as a secured claim for all purposes in these Chapter 11 cases. On the Effective Date, GE Capital will be deemed to have received value in full satisfaction of the Allowed Secured Claim by way of (i) the Auction Proceeds and (ii) the Retained Collateral; (d) Unsecured Claim with respect to Schedule No. 1. Pursuant to Section 506(a) of the Bankruptcy Code, GE Capital has a general unsecured deficiency claim with respect to Schedule No. 1 amounting to $10,800,000, which amount is allowed in full for all purposes in these Chapter 11 cases; (e) Allowed Unsecured Claim. GE Capital's total allowed unsecured claim is $12,503,025; and (f) Administrative and Tax Claims. To the extent not already paid, Enron will pay all postpetition Taxes accruing on or before December 31, 2003 with respect to the GE Collateral. GE Capital will have no administrative claim in Enron's Chapter 11 case as asserted in the Proof of Claim, and no claim arising from Enron's obligations under the 2001 Agreement to pay taxes as asserted in the Proof of Claim. Enron acknowledges that one or more Taxing Authorities assert claims for taxes on the GE Collateral that accrued prior to the Petition Date. Without admitting any liability in that regard, Enron agrees that as between Enron and GE Capital, GE Capital will have no liability for any Prepetition Tax Claims, and that Enron will be solely liable for, and will assume the defense for, any Prepetition Tax Claims. Enron agrees to indemnify, defend and hold GE Capital harmless from any claim or liability that may be asserted against GE Capital for the Prepetition Tax Claims, provided, however, that the aggregate payment required will not exceed the amount of the proof of claim asserted by the Texas Taxing Authorities against Enron under Proof of Claim No. 22411, or in the event that Claim No. 22411 is allowed pursuant to a Court order, is in an amount less than $2,158,405. 2. Surplus Collateral This Stipulation does not alter or affect GE Capital's rights with respect to the Surplus Collateral pursuant to the August 6 Stipulation, including, but not limited to, having the Surplus Collateral located on unused floors of Enron Center North remain in place through and including December 31, 2003. 3. Retained Collateral (a) The Retained Collateral located at Enron Center North will be abandoned by Enron pursuant to Section 554 of the Bankruptcy Code as of December 31, 2003; (b) The Retained Collateral may remain at its present location through and including February 29, 2004 without any rent or storage costs. Upon reasonable notice to Enron, GE Capital may inspect the Retained Collateral. Subsequent to the abandonment by Enron of the Retained Collateral, GE Capital may remove the Removable Retained Collateral in whole or in part at any time on or before February 29, 2004 and may sell, retain or otherwise dispose them as GE Capital will deem fit without further Court order. To the extent GE Capital acknowledges that the lien asserted by the Texas Taxing Authorities is superior to the its liens, the Texas Taxing Authorities will have the same rights that are granted to GE Capital; 4. Adequate Protection Payments Beginning January 1, 2004, Enron will have no further obligation to make monthly adequate protection payments from January 1, 2004 forward with respect to the Retained Collateral. GE Capital will be entitled to retain all amounts paid as adequate protection under Schedule No. 1. Effective as of January 1, 2004 Enron will have no obligations under the Adequate Protection Stipulation that accrue or would accrue on and after January 1, 2004. (Enron Bankruptcy News, Issue No. 104; Bankruptcy Creditors' Service, Inc., 215/945- 7000) EOS INTL: Files Form 15 to Terminate SEC Reporting & Delist Shares ------------------------------------------------------------------ Eos International, Inc. (OTC Bulletin Board: EOSI) announced that it has filed a Form 15 with the Securities and Exchange Commission to terminate registration of Eos' common stock, par value of $0.01 per share, under the Securities Exchange Act of 1934. The filing of the Form 15 suspends the obligations of Eos to file further periodic reports with the SEC, including Forms 10-K, 10-Q and 8-K. Upon the effectiveness of the Form 15, which is anticipated to be within 90 days after filing, Eos will no longer be obligated to file periodic reports with the SEC. Eos has notified Nasdaq of this action. Bid and asked quotations on Eos common stock will no longer be reported on the Nasdaq OTC Bulletin Board. Joe Ferreira, President and Chief Executive Officer, made the following comment: "The accounting, legal and administrative costs of remaining a reporting company outweigh the benefits to our company and our stockholders. As a non-reporting company, we expect to realize significant cost savings and avoid anticipated future costs. Management will be able to devote increased attention and resources to improving operations, managing liabilities and enhancing long-term value." About Eos International, Inc. Eos International, Inc. is a holding company for direct selling companies of consumer goods. Eos owns 100% of the capital stock of each of Discovery Toys, Inc. and I.F.S. of New Jersey, Inc. and 85% of the capital stock of Regal Greetings and Gifts Corporation. As reported in the Troubled Company Reporter's March 17, 2004 edition, due to lack of working capital at Eos International Inc. and possible non-compliance with bank covenants, there is uncertainty as to whether Eos can continue as a going concern. The report of its auditors on its consolidated financial statements as of September 30, 2003 contains a separate paragraph stating that substantial doubt exists about the Company's ability to continue as a "going concern". Uncertainty existed as to whether Eos would have sufficient working capital, whether Discovery Toys would be successful in receiving a waiver on default of its bank covenants at September 30, 2003 and renegotiating covenants for the remainder of 2003 and 2004, and whether the Company's other operating subsidiaries will be able to continue to comply with certain borrowing covenants during the fiscal year ending September 30, 2004. On December 17, 2003, Discovery Toys received the waiver, and renegotiated its covenants for the fiscal year ending September 30, 2004. Should Eos be unable to secure additional financing or be in default of its debt agreements because of covenant violations, a lender could call its line of credit. These conditions raise substantial doubt about the Company's ability to continue as a "going concern". EQUUS GAMING: Still Unable to File Form 10-K over Units' Results ---------------------------------------------------------------- Equus Gaming Company L.P. is unable to timely file its financial information with the SEC because the Company is still in the process of confirming operating results from wagering operations in the Dominican Republic, Puerto Rico and Colombia. Until the reported numbers can be confirmed and the results for the year reviewed by the Company's independent public accountants, Equus Gaming will not be in a position to file Form 10-K for the period ended December 31, 2002, however, the Company expects to file within the next 60 days. Total Revenues for the fiscal year 2002 will be approximately $4 million greater than the results for the corresponding fiscal year period of 2001. This increase in revenue reflects the losses experienced in fiscal year 2001 as a result of sale of investments that did not occur in fiscal year 2002. Commissions on wagering in fiscal year 2002, the primary source of revenues, is expected to reflect a decline of approximately $400 thousand from fiscal year 2001 as a result of the continual degredation of the total wagering handle. Total Expenses for the fiscal year 2002 are expected to reflect a decrease of approximatley $6 million as compared to the previous fiscal year of 2001. This reduction of expenses is reflective of management reduction in operating expenses, salaries and wages, general and administrative expenses, satellite costs and horseowners purses. The above increase in revenues and reduction in expenses is expected to reduce the Net Loss by approximately $10 million in fiscal year 2002 versus fiscal year 2001. EXPO DYEING & FINISHING: Case Summary & 20 Unsecured Creditors -------------------------------------------------------------- Debtor: Expo Dyeing & Finishing Inc. 1365 Knollwood Circle Anaheim, California 92801 Bankruptcy Case No.: 04-12436 Type of Business: The Debtor provides textile dyeing and finishing services. Chapter 11 Petition Date: April 13, 2004 Court: Central District of California (Santa Ana) Judge: James N. Barr Debtor's Counsel: Thomas E. Kent, Esq. Law Offices of Thomas Kent 3250 Wilshire Boulevard Suite 1700 Los Angeles, CA 90010 Tel: 213-380-2828 Estimated Assets: $1 Million to $10 Million Estimated Debts: $1 Million to $10 Million Debtor's 20 Largest Unsecured Creditors: Entity Nature Of Claim Claim Amount ------ --------------- ------------ Enron Energy Services Utility Bills $656,894 5200 Upper Metro Place Dublin, OH 43017 United Fabricare Supply Inc. Trade Debt $321,154 1237 West Walnut Street Compton, CA 90220 Orange County Sanitation Sanitation Services $178,624 Orange County Tax Collector Property Taxes $167,088 Westco Sprectra Color, Inc. Trade Debt $138,916 LA Supply Trade Debt $105,055 CIBA Specialty Chemicals Trade Debt $103,635 State Compensation Ins. Fund Worker's Comp. Ins. $86,285 Premium Style Knits Trade Debt $86,285 Sees Development Trade Debt $80,000 BlueBridge Gas Company Utility Bills $65,613 Occidental Energy Marketing Utility Bills $64,480 Hana Financial Trade Debt $64,380 Univar USA, Inc. Trade Debt $60,366 F & F Knitting Trade Debt $46,691 City of Anaheim Utility Bills $40,476 Caist Industries, Inc. Trade Debt $31,072 Morton International Trade Debt $24,596 Basic Chemical Solution Trade Debt $19,356 Royal Packaging Trade Debt $12,496 FIRST NATIONAL: Case Summary & 31 Largest Unsecured Creditors ------------------------------------------------------------- Lead Debtor: The First National Gunbanque Corporation 3259 Electra Drive South Colorado Springs, Colorado 80906 Bankruptcy Case No.: 04-16544 Debtor affiliates filing separate chapter 11 petitions: Entity Case No. ------ -------- Karl Clark Lippard 04-16545 Type of Business: The Debtor is the largest firearms broker in the world, specializing in firearms that are no longer manufactured or readily available. See http://www.fngbcorp.com/ Chapter 11 Petition Date: April 1, 2004 Court: District of Colorado (Denver) Judge: Howard R. Tallman Debtors' Counsel: F. Brittin Clayton, III, Esq. 1645 Canyon Boulevard Boulder, CO 80302 Tel: 303-444-7722 Fax: 303-444-8170 Estimated Assets Estimated Debts ---------------- --------------- The First National Gunbanque $50,000-$100,000 $1 M to $10 M Corporation Karl Clark Lippard $500,000-$1 M $1 M to $10 M A. First National Gunbanque's 11 Largest Unsecured Creditors: Entity Nature Of Claim Clai