/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/040713.mbx T R O U B L E D C O M P A N Y R E P O R T E R Tuesday, July 13, 2004, Vol. 8, No. 143 Headlines ACCLAIM ENTERTAINMENT: Auditors Express Going Concern Doubt ADELPHIA COMMS: Court Modifies Automatic Stay On Devon Claims ADVANCED MEDICAL: Receives $70M Tender Offer for 9-1/4% Sr. Notes AIR CANADA: Canadian Auto Workers Ratify Labour Agreements AIRGATE PCS: Appoints Roy Hadley, Jr., as VP and General Counsel ALLEGHENY ENERGY: Names James Kauffman Vice President and CIO ALLIED PRINTING: Case Summary & 23 Largest Unsecured Creditors AMCAST INDUSTRIAL: Inks Pact to Sell Flow Control Division Assets AMERICAN TUBE & STEEL: Voluntary Chapter 11 Case Summary ANALYTICAL SURVEYS: Cures Senior Secured Debt Default APPLIED SOIL MECHANICS: Case Summary & 20 Unsecured Creditors ARBOR TREE SURGERY: Case Summary & 20 Largest Unsecured Creditors ASSET SECURITIZATION: S&P Raises Class A-4 Ratings To BB CALHOUN CBO: Fitch Maintains Senior Fixed Notes Ratings At C CANADA PAYPHONE: Intends to Make Proposal to Creditors Under BIA CANDESCENT TECH: Hires Pachulski Stang as Bankruptcy Attorneys CANDESCENT TECH: US Trustee Names 6-Member Creditors' Committee CATHOLIC CHURCH: Hires Schwabe Williamson Litigation Counsel CIRTRAN CORP: Opens Asia Headquarters for Cirtran-Asia Division COEUR D'ALENE: Wheaton Does Not Intend to Negotiate with Coeur CONTINENTAL DIVIDE: Case Summary & 20 Largest Unsecured Creditors CORAM HEALTHCARE: FFF Enterprises Offers $225 Million in Cash CREDIT SUISSE: Fitch Assigns Low Ratings to 6 Classes CROSSGEN ENTERTAIMENT: Sec. 341(a) Meeting Slated for Tomorrow DII: Halliburton Names Cedric Burgher Vice President and Treasurer EL PASO: Subsidiary Receives Waiver of Indenture Default ENRON: EESI Seeks Court OK to Liquidate Komag Inc. Common Stock FLEMING COS: General Mills Wants $980K Plus Expenses Reimbursed FOOTSTAR: Enters Agreement to Sell Mira Loma Distribution Center FOSTER WHEELER: Extends Common Shares Tender Offer to July 30 FRESH CHOICE: Plans to File Voluntary Petition Under Chapter 11 GLOBALNET INTERNATIONAL: Has Until August 14 to File Schedules GULFMARK OFFSHORE: S&P Assigns Proposed $155M Note Rating at BB- HARTCOURT COMPANIES: Auditors Raise Going Concern Doubt HUDSON STRAITS: S&P Rates Class E Deferrable Notes at BB HUMANA TRANS: Net Losses Trigger Going Concern Doubt INDEPENDENCE COURT: US Trustee to Meet with Creditors on Aug. 3 INTERPOOL INC: Fitch Assigns CCC+ Ratings To Preferred Stock KIWA BIO: Inks Letter of Intent With Reforestation Technologies LAIDLAW: IRS Wants Court to Allow $8 Million Claim LANTIS EYEWEAR: Wants to Employ RAS as Management Consultant LOEWS CINEPLEX: S&P Assigns Corporate Credit Rating At B MARINER HEALTH: Inks $1 Bil. Merger Pact with National Senior Care MEDIA GROUP INC: Case Summary & 25 Largest Unsecured Creditors METROMEDIA INT'L: Inks Pact to Sell Radio Unit to Communicorp MORGAN RV INC: Case Summary & 20 Largest Unsecured Creditors NATIONAL SCHOLARSHIP: Case Summary & Largest Unsecured Creditors NEWAVE INC: Reports $740,000 of Gross Revenues in June 2004 NEW CENTURY: Capital Deficit Triggers Going Concern Doubt NEWMARKET TECH: Nevada Secretary of State Accepts Name Change NRG ENERGY: Completes Sale of McClain Generating Station to OGE NRG ENERGY: Nelson Debtors Resolve CSFB and PCL Industrial Claims OMNI FACILITY: Wants to Retain Candlewood as Investment Bankers OWENS CORNING: Senator Suggests Creation of $141B Asbestos Trust PACIFIC GAS: Parties Amend Board of Equalization Stipulation Terms PARADIGM MEDICAL: Takes Steps to Reduce Costs and Expenses PARK CITY: Anticipates Positive Results in Preliminary Q4 Review PARMALAT: Pennsylvania Milk Board Gets $3.5 Million Cash Bond PEGASUS: Applies to Employ Drinker Biddle as Corporate Counsel PENTON MEDIA: Inks Separation Agreements with Former CEO & COO PILLOWTEX CORP: Kohl's Wants Court to Dismiss Complaint PLYMOUTH COMMONS REALTY: Voluntary Chapter 11 Case Summary POLO BUILDERS: Look for Schedules & Statements by July 29 PORTLAND HOUSING: S&P Lowers Series 1997A Bonds Rating To BB+ RELIANCE GROUP: PBGC Says RFS' Disclosure Statement is Inadequate RESIDENTIAL ACCREDIT: Fitch Affirm Classes B-1 & B-2 Low-B Ratings REVLON INC: Strengthens Balance Sheet With New $960M Bank Facility ROANOKE TECH: Can Now Issue 100 Million Class A Common Shares SABRELINER CORP: S&P Downgrades Corporate Credit Ratings To B- SIGHT RESOURCE: First Creditors Meeting Slated for July 30 SOLUTIA: Amends $500 Million DIP Financing Facility One More Time SPIEGEL INC: Court Authorizes Spiegel Catalog Assets Sale UAL CORP: Wants Court to Nix 7 Claims Totaling $700 Million STRUCTURED ASSET: Fitch Takes Various Rating Actions UNIFLEX: U.S. Trustee Schedules Sec. 341(a) Meeting on August 4 UNIFLEX: Wants Donlin Recano as Claims, Notice & Ballot Agent WASHINGTON MUTUAL: Fitch Affirms Low-B Ratings of 6 Classes WASTECORP.: Delays Filing of Financial Statements WEIRTON STEEL: Fair Harbor Offers 42% for Administrative Claims WILSONS LEATHER: Repurchases & Cancels $22M of 11-1/4% Sr. Notes WMF PROPERTIES: Case Summary & 3 Largest Unsecured Creditors * Large Companies with Insolvent Balance Sheets ********* ACCLAIM ENTERTAINMENT: Auditors Express Going Concern Doubt ----------------------------------------------------------- In compliance with NASDAQ Marketplace rule 4350 (b) Acclaim Entertainment, Inc.'s (Nasdaq: AKLM) independent auditors, KPMG, LLP, have included in their independent auditor's report dated June 29, 2004 an explanatory paragraph relating to substantial doubt as to Acclaim's ability to continue as a going concern, due to working capital and stockholders' deficits as of March 31, 2004 and the recurring use of cash in operating activities. The auditor's report is contained within the Company's annual report on Form 10-K filed with the Securities and Exchange Commission on July 1, 2004. This explanatory paragraph is not a new qualification, as KPMG's independent auditor reports have included a going concern qualification relating to the Company's financial statements, for each of the Company's past four fiscal years ending August 31, 2001 and 2002 and March 31, 2003 and 2004. About Acclaim Entertainment Based in Glen Cove, N.Y., Acclaim Entertainment, Inc., is a worldwide developer, publisher and mass marketer of software for use with interactive entertainment game consoles including those manufactured by Nintendo, Sony Computer Entertainment and Microsoft Corporation as well as personal computer hardware systems. Acclaim owns and operates five studios located in the United States and the United Kingdom, and publishes and distributes its software through its subsidiaries in North America, the United Kingdom, Australia, Germany, France and Spain. The Company uses regional distributors worldwide. Acclaim also distributes entertainment software for other publishers worldwide, publishes software gaming strategy guides and issues "special edition" comic magazines periodically. Acclaim's corporate headquarters are in Glen Cove, New York and Acclaim's common stock is publicly traded on NASDAQ.SC under the symbol AKLM. For more information please visit our website at http://www.acclaim.com/ At March 31, 2004, Acclaim Entertainment's balance sheet reflects a stockholders' deficit of $97,983,000 compared to a deficit of $55,088,000 at March 31, 2003. ADELPHIA COMMS: Court Modifies Automatic Stay On Devon Claims ------------------------------------------------------------- On January 16, 2003, certain of the Adelphia Communications Debtors timely filed four unsecured claims in against Devon Mobile Communications, L.P.: (1) a claim for not less than $96,323,824 for loans, service fees and coordination of purchases fees; (2) a claim for not less than $34,798,814 for certain guarantee obligations under the Services Agreement, as amended, between Devon and General Dynamics Government Systems Corporation; (3) a claim for not less than $1,260,127 for telephone services rendered by ACC Telecommunications of Virginia, LLC, an ACOM affiliate; and (4) a claim for not less than $441,691 for telephone services performed by ACC Virginia. On October 21, 2003, certain of the ACOM Debtors filed an administrative proof of claim against the Devon Debtors for not less than $89,866 arising from certain lease expenses for vehicles leased specifically for Devon's use. On January 8, 2004, the Devon Liquidating Trustee filed a proof claim in each of the ACOM Debtors' Chapter 11 cases. The Devon Claims supersede all of the claims previously filed by Devon and each previously filed claims will be deemed withdrawn. A description of the Amended Devon Claims is available at: http://bankrupt.com/misc/RiderToDevonClaims.pdf The Devon Trustee asked the ACOM Debtors for permission to take steps necessary to liquidate the Devon Claims in the New York Bankruptcy Court, including the filing and prosecution of a complaint, and to litigate objection to the ACOM claims in the Delaware Bankruptcy Court. Accordingly, in a stipulation approved by Judge Gerber, the ACOM Debtors and the Devon Trustee agree that: (1) The automatic stay in force in the ACOM Debtors' Chapter 11 cases is modified: (a) The Devon Trustee will be permitted to file and to prosecute the complaint as an adversary proceeding in the New York Bankruptcy Court, and the Devon Trustee waives his right under Rule 1014 of the Federal Rules of Bankruptcy Procedure to move to transfer the venue of any litigation on the Complaint, except that Devon may seek to amend the Complaint as permitted by applicable law; (b) The Devon Trustee will be permitted to prosecute the Complaint to judgment for the sole purpose of liquidating the Devon Claims, including those set forth in the Complaint; and (c) The Devon Trustee will be permitted to file and prosecute objections to the ACOM Claims in the Delaware Bankruptcy Court and the ACOM Debtors waive their rights under Bankruptcy Rule 1014 to move to transfer venue of any litigation involving the ACOM Claims and the Devon Objections to any Court other than the Delaware Bankruptcy Court; and (2) In the event the Devon Trustee obtains a judgment in its favor on the Complaint or ACOM obtains an allowed claim on account of the ACOM claims, any judgment or allowed claims will be subject to any rights of set-off and recoupment by the parties, to the extent permitted under applicable law. (Adelphia Bankruptcy News, Issue No. 63; Bankruptcy Creditors' Service, Inc., 215/945-7000) ADVANCED MEDICAL: Receives $70M Tender Offer for 9-1/4% Sr. Notes ----------------------------------------------------------------- Advanced Medical Optics, Inc. (AMO) (NYSE:AVO), announced the final results of its offer to purchase for cash any and all of the $70,000,000 aggregate outstanding principal amount of its 9-1/4 percent Senior Subordinated Notes due 2010 (CUSIP number 00763MAC2) and solicitation of consents to certain proposed amendments to the indenture related to the Notes. The Offer commenced on June 9, 2004, and expired at midnight, Eastern Daylight Time, on July 8, 2004. The Consent Solicitation expired at 5:00 p.m., Eastern Daylight Time, on June 21, 2004, and the supplemental indenture effecting the proposed amendments became operative on June 23, 2004. Based on a final count by The Bank of New York, the depositary for the Offer, a total of $70,000,000 aggregate principal amount at maturity of Notes was validly tendered by holders of the Notes as of the Expiration Date. Of the $70,000,000 principal amount of Notes tendered, $69,998,000 aggregate principal amount of Notes was tendered on or prior to the Consent Date and $2,000 aggregate principal amount of Notes was tendered after the Consent Date, but on or prior to the Expiration Date. Subject to the conditions of the Offer, AMO expects to accept for payment and pay for all Notes that were validly tendered and not validly withdrawn after the Consent Date, but on or prior to the Expiration Date, on or promptly following the first business day after the Expiration Date. All Notes tendered on or prior to the Consent Date were accepted for purchase and paid for by AMO on June 23, 2004. Lehman Brothers Inc. acted as exclusive dealer manager and Mellon Investor Services LLC acted as information agent in connection with the Offer. About Advanced Medical Optics Advanced Medical Optics, Inc. is a global leader in the development, manufacturing and marketing of ophthalmic surgical and eye care products. The company focuses on developing a broad suite of innovative technologies and devices to address a wide range of eye disorders. Products in the ophthalmic surgical line include foldable intraocular lenses, phacoemulsification systems, viscoelastics and related products used in cataract surgery, and microkeratomes used in LASIK procedures for refractive error correction. AMO owns or has the rights to such ophthalmic surgical product brands as PhacoFlex, Clariflex, Array and Sensar foldable intraocular lenses, the Sovereign phacoemulsification system with WhiteStar(TM) technology and the Amadeus(TM) microkeratome. Products in the contact lens care line include disinfecting solutions, daily cleaners, enzymatic cleaners and lens rewetting drops. Among the contact lens care product brands the company possesses are COMPLETE, COMPLETE Blink-N-Clean, COMPLETE Moisture PLUS(TM), ConseptF, Consept 1 Step, Oxysept 1 Step, Ultracare, Ultrazyme, Total Care and blink(TM) branded products. Amadeus is a licensed product of, and a trademark of, SIS, Ltd. Advanced Medical Optics, Inc. is based in Santa Ana, California, and employs approximately 2,300 worldwide. The Company has direct operations in about 20 countries and markets products in approximately 60 countries. For more information, visit the Company's web site at http://www.amo-inc.com/ * * * As reported in the Troubled Company Reporter's June 18, 2004 edition, Standard & Poor's Ratings Services affirmed its 'BB-' corporate credit and bank loan ratings and its 'B' subordinated debt rating on vision care company Advanced Medical Optics Inc. At the same time, Standard & Poor's assigned its 'B' subordinated debt rating to the company's proposed $275 million senior subordinated convertible notes due in 2024. The outlook is stable. AIR CANADA: Canadian Auto Workers Ratify Labour Agreements ---------------------------------------------------------- Air Canada announced that the ratification of the mainline carrier's labour agreements was successfully completed Friday with the confirmation from the Canadian Auto Workers (CAW) Airline Division that the airline's customer sales and service agents and crew schedulers at Air Canada have ratified their agreement. The mainline carrier has now achieved its share of the labour cost realignment target required to satisfy the conditions in the Deutsche Bank Standby Agreement and the GE Capital Aviation Services Global Restructuring Agreement. Over the past six weeks, agreements were ratified with the Air Canada Pilots Association representing mainline pilots, Canadian Airline Dispatchers Association (CALDA) representing flight dispatchers, Canadian Union of Public Employees (CUPE) representing flight attendants, and the International Association of Machinists and Aeropace Workers representing technical operations, airport ground service, finance, cargo and clerical personnel. Agreements were also ratified with three unions representing Air Canada Jazz employees - the Airline Pilots Association, CALDA and the CAW Airline Division. Teamsters Canada, representing Air Canada Jazz flight attendants were unable to ratify their agreement in the timeline given. Following attendance in Court today, Teamsters Canada have extended the time for completion of the ratification vote until July 15, 2004 in order to provide adequate time for all members to vote. A report will be submitted to the Court on July 16, 2004. "The ratification of our labour agreements sends a strong message to the other stakeholders that the people of Air Canada are willing to do what it takes to ensure a strong, viable airline going forward," said Robert Milton, President and Chief Executive Officer. "I salute the people of Air Canada and Air Canada Jazz and thank them for taking this necessary step. I remain confident that Teamsters Canada and the Air Canada Jazz flight attendants they represent will work towards a successful outcome to ensure the future of Air Canada Jazz and its employees." The Court set August 17, 2004 as the date for the Creditors Meeting to vote on the Restructuring Plan. Air Canada is proceeding with all planned activity to meet the September 30, 2004 target for emergence from CCAA. Headquartered in Saint-Laurent, Quebec Canada, Air Canada -- http://www.aircanada.ca-- represents Canada's only major domestic and international network airline, providing scheduled and charter air transportation for passengers and cargo. The Company filed for CCAA protection on April 1, 2003 (Ontario Superior Court of Justice, Case No. 03-4932) and Section 304 petition with the U.S. Bankruptcy Court for the Southern District of New York (Case No. 03-11971). Matthew A. Feldman, Esq., and Elizabeth Crispino, Esq., at Willkie Farr & Gallagher serve as the Debtors' U.S. Counsel. When the Debtors filed for protection from its creditors, they listed C$7,816,000,000 in assets and C$9,704,000,000 in liabilities. AIRGATE PCS: Appoints Roy Hadley, Jr., as VP and General Counsel ---------------------------------------------------------------- Roy E. Hadley, Jr., has joined AirGate PCS, Inc. (Nasdaq: PCSA), a PCS Affiliate of Sprint, as Vice President, General Counsel and Secretary. "We are very pleased to have someone of Roy Hadley's caliber join the AirGate management team," commented Thomas M. Dougherty, president and chief executive officer of AirGate PCS. "His extensive corporate legal experience and background in various communications industries will be a tremendous asset to AirGate, and we have every confidence that he will make a direct and significant contribution to the next stage of the Company's growth." Prior to joining AirGate, Mr. Hadley served as Chief Privacy Officer and Vice President, Legal Department for WorldTravel BTI. He held this position since July 2001 with responsibility for all legal matters for both headquarters and divisional operations as well as direct oversight for all privacy and data security matters, risk management, business acquisitions and divestitures, and primary support for the headquarters and divisional human resources departments. He also served on the audit committee and was responsible for the development and implementation of the Sarbanes-Oxley compliance program and strategic plan. Mr. Hadley previously served as Senior Counsel for Turner Entertainment Group; AOL Time Warner from 1999-2001, and Associate Commercial Counsel, MCI WorldCom, Inc. from 1995-1998. He also served as an associate in the law firm of Long, Aldridge & Norman in Atlanta in the general corporate and securities law practice group. Mr. Hadley received both an undergraduate degree and a law degree from the University of Georgia. About the Company AirGate PCS, Inc. is the PCS Affiliate of Sprint with the right to sell wireless mobility communications network products and services under the Sprint brand in territories within three states located in the Southeastern United States. The territories include over 7.4 million residents in key markets such as Charleston, Columbia, and Greenville-Spartanburg, South Carolina; Augusta and Savannah, Georgia; and Asheville, Wilmington and the Outer Banks of North Carolina. At March 31, 2004, Airgate PCS, Inc.'s balance sheet shows a stockholders' deficit of $91.5 million compared to a $377 million deficit reported at September 30, 2003. ALLEGHENY ENERGY: Names James Kauffman Vice President and CIO ------------------------------------------------------------- Allegheny Energy, Inc. (NYSE: AYE) named James B. Kauffman to the newly created position of Vice President and Chief Information Officer for the company. He will report to Jeffrey Serkes, Senior Vice President and Chief Financial Officer. "The innovative and effective use of technology is a key enabler to the development of a high performance organization at Allegheny Energy," said Mr. Serkes. "Jim will be responsible for delivering technology solutions that help position Allegheny as a top-tier energy company." Previously, Mr. Kauffman was Director of Information Services for Allegheny. He has a broad background in business process design across Allegheny's bulk power and retail delivery organizations. He received a Bachelor's degree in Civil Engineering and a Master's degree in Industrial Engineering from the University of Pittsburgh. He is also a registered Professional Engineer in Pennsylvania, West Virginia, Ohio, Virginia and Maryland. Headquartered in Greensburg, Pa., Allegheny Energy is an integrated energy company with a portfolio of businesses, including Allegheny Energy Supply, which owns and operates electric generating facilities, and Allegheny Power, which delivers low-cost, reliable electric and natural gas service to about four million people in Pennsylvania, West Virginia, Maryland, Virginia and Ohio. More information about Allegheny Energy is available at http://www.alleghenyenergy.com/ * * * As reported in the Troubled Company Reporter's March 18, 2004 edition, Fitch Ratings affirmed and removed from Rating Watch Negative the ratings of Allegheny Energy, Inc. and the utility subsidiaries: Allegheny Energy, Inc. -- Senior unsecured debt 'BB-'; -- 11-7/8% notes due 2008 'B+'. Allegheny Capital Trust I -- Trust preferred stock 'B+'. West Penn Power Company -- Medium-term notes and senior unsecured 'BBB-'. Potomac Edison Company -- First mortgage bonds 'BBB'; -- Senior unsecured notes 'BBB-'. Monongahela Power Company -- First mortgage bonds 'BBB'; -- Medium-term notes 'BBB-'; -- Pollution control revenue bonds (unsecured) 'BBB-'; -- Preferred stock 'BB+'. The Rating Outlook is Stable. The 'BB-' rating of Allegheny Energy, Inc.'s former bank credit facility maturing in January 2005 is withdrawn as that bank credit facility has been terminated and replaced. ALLIED PRINTING: Case Summary & 23 Largest Unsecured Creditors -------------------------------------------------------------- Lead Debtor: Allied Printing, Inc. aka Allied Graphics 7403 Philips Highway Jacksonville, Florida 32256 Bankruptcy Case No.: 04-06812 Debtor affiliates filing separate chapter 11 petitions: Entity Case No. ------ -------- Phillips, Muller, Thomas, Incorporated 04-06811 Type of Business: The Debtor is a commercial, financial and publication printer specializing in high quality color lithography. See http://www.alliedgraphics.net/ Chapter 11 Petition Date: July 2, 2004 Court: Middle District of Florida (Jacksonville) Judge: Jerry A. Funk Debtors' Counsel: Earl M. Barker, Jr., Esq. Slott & Barker 334 East Duval Street Jacksonville, FL 32202 Tel: 904-353-0033 Total Assets Total Debts ------------ ----------- Allied Printing, Inc. $3,373,230 $6,099,485 Phillips, Muller, Thomas, Inc. $1,358,400 $1,330,454 A. Allied Printing, Inc.'s 20 Largest Unsecured Creditors: Entity Nature Of Claim Claim Amount ------ --------------- ------------ FL Dept. of Revenue Sales Tax $454,707 State Sales Tax Division 5050 W. Tennessee St. Tallahassee, FL 32399 First Bank of Jacksonville $400,000 11100 San Jose Blvd. Jacksonville, FL 32223 Fleet Business Credit Secured Value: $231,020 $450,000 Case Paper Company Paper Supply $191,339 Strategic Outsourcing, Inc. $122,063 Mac Papers-Jacksonville Paper $103,711 GE Capital Secured Value: $101,008 $175,000 Unisource Paper $92,387 IOS Capital Secured Value: $91,200 $75,000 York Paper Company Paper $87,411 Toyo Ink Ink $84,486 David Cutler Industries Paper $50,426 Ikon Office Solutions Maintenance Contract $48,980 Creos Americas, Inc. Maintenance Contract $39,168 Phillips, Muller Thomas Inc. $32,900 First Bank of Jacksonville Line of Credit $25,000 Xerox Capital Services Security Agreement $24,800 Secured Value: $100,000 G.E. Richards Graphic Plants & Chemicals $24,058 Supplies US Ink Corporation Ink $23,382 Knopf & Sons Bindery Subcontract work $21,598 B. Phillips, Muller, Thomas' 3 Largest Unsecured Creditors: Entity Claim Amount ------ ------------ David Cutler Industries $24,000 Florida Dept. of Revenue $10,495 Champion Industries, Inc. $7,500 AMCAST INDUSTRIAL: Inks Pact to Sell Flow Control Division Assets ----------------------------------------------------------------- Amcast Industrial Corporation, (OTCBB:AICO) signed a definitive agreement to sell most of the assets of its Flow Control division to a U.S. subsidiary of the Dutch group Aalberts Industries N.V. (Amsterdam:AAL). The transaction, which is subject to regulatory approval and customary closing conditions, is anticipated to close within the next thirty days. The sale of the Flow Control products segment includes the businesses of Elkhart Plumbing (Elkhart, Indiana & Fayetteville, Arkansas), Elkhart Industrial (Geneva, Indiana), and Amcast Industrial Ltd. (Burlington, Ontario). This asset sale is being made to comply with the provisions of our loan agreements. The proceeds will be used to reduce debt. Amcast Industrial Corporation is a leading manufacturer of technology-intensive metal products. Its two business segments are brand name Flow Control Products marketed through national distribution channels and Engineered Components for original equipment manufacturers. The company serves the automotive, construction, and industrial sectors of the economy. At May 30, 2004, Amcast Industrial Corporation reports a stockholders' deficit of $40,094,000 compared to a deficit of $41,935,000 at August 31, 2003. AMERICAN TUBE & STEEL: Voluntary Chapter 11 Case Summary -------------------------------------------------------- Debtor: American Tube & Steel Fabricators, Inc. 28064 Avenue Stanford Unit C Valencia, California 91355 Bankruptcy Case No.: 04-14530 Chapter 11 Petition Date: July 1, 2004 Court: Central District of California (San Fernando Valley) Judge: Geraldine Mund Debtor's Counsel: Jeffrey L. Willis, Esq. Law Office of Jeffrey L. Willis 24575 Town Center Drive #2106 Valencia, CA 91355 Tel: 805-405-1510 Estimated Assets: $1 Million to $10 Million Estimated Debts: $500,000 to $1 Million The Debtor did not file a list of its 20-largest creditors. ANALYTICAL SURVEYS: Cures Senior Secured Debt Default ----------------------------------------------------- Analytical Surveys, Inc. (ASI) (Nasdaq: ANLT), a leading provider of utility-industry data collection, creation and management services for the geographic information systems (GIS) markets, cured the event of default announced on June 1, 2004. The Company's $1.7 million Senior Secured Convertible Note has been restructured by extending the maturity of the Note has been extended until January 2, 2006. The Note is convertible into Common Stock pursuant to the terms of the previous Note or is payable in cash upon maturity at the option of the holder. The restructuring eliminated approximately $134,000 of accrued interest, and all penalties that had been incurred under the event of default. The holder of the Note relinquished its rights under a Warrant that was issued on April 2, 2002, pursuant to the issuance of the original Note and which provided the holder of the Note the right to purchase 500,000 shares of Common Stock. This Warrant was cancelled in the restructuring. Analytical Surveys Inc. provides technology-enabled solutions and expert services for geospatial data management, including data capture and conversion, planning, implementation, distribution strategies and maintenance services. Through its affiliates, ASI has played a leading role in the geospatial industry for more than 40 years. The Company is dedicated to providing utilities and government with responsive, proactive solutions that maximize the value of information and technology assets. ASI is headquartered in San Antonio, Texas and maintains operations in Waukesha, Wisconsin. For more information, visit http://www.anlt.com/ APPLIED SOIL MECHANICS: Case Summary & 20 Unsecured Creditors ------------------------------------------------------------- Debtor: Applied Soil Mechanics Inc. P.O. Box 4259 San Luis Obispo, California 93403 Bankruptcy Case No.: 04-11716 Chapter 11 Petition Date: July 2, 2004 Court: Central District of California (North Division) Judge: Robin Riblet Debtor's Counsel: Simon Aron, Esq. Wolf, Rifkin, Shapiro & Schulman, LLP 11400 West Olympic Boulevard 9th Floor Los Angeles, CA 90064 Tel: 310-478-4100 Total Assets: $500,000 to $1 Million Total Debts: $1 Million to $10 Million Debtor's 20 Largest Unsecured Creditors: Entity Claim Amount ------ ------------ Earth Systems, Inc. $977,359 c/o Jerry Brown 895 Aerovista Place Ste. 100 San Luis Obispo, CA 93401 Bill E. Zehbach $84,900 Carl W. Greenlee $43,350 Severson & Werson $51,087 Warm Springs Associates I $12,521 Exploration Geoservices Inc. $6,909 Dynamic Consultants, Inc. $6,000 Mattingly Testing Servs. Inc. $6,000 Braun Intertec Corp. $5,000 Blaine Tech Services Inc. $2,000 Executive Business Center $1,095 Nextel Communications $1,000 Exploration Drilling Services $1,000 CELSOC $882 Pacific Gas & Electric Co. $800 Berry Network $780 GE Business Productivity $700 Access Soil Drilling, Inc. $500 Cenozoic Exploration $500 North Star Drilling $500 ARBOR TREE SURGERY: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: Arbor Tree Surgery Inc. 802 Paso Robles Street Paso Robles, California 93446 Bankruptcy Case No.: 04-11667 Type of Business: The Debtor provides utility line clearance tree trimming, residential, commercial, and municipal tree care, ornamental arboriculture, and custom vegetation management services for power companies and other customers in the western US, including California and Oregon. See http://www.arbortree.com/ Chapter 11 Petition Date: June 30, 2004 Court: Central District of California (North Division) Judge: Robin Riblet Debtor's Counsel: Edwin J. Rambuski, Esq. Law Offices of Edwin J. Rambuski 1220 Marsh Street San Luis Obispo, CA 93401 Tel: 805-546-8284 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 ------ --------------- ------------ State Fund Insurance $212,883 The Hartford Insurance $58,154 Blue Shield of California Insurance $50,016 Blue Cross of California Insurance $48,048 Ramos Oil Co. Trade Debt $27,202 Fremont Compensation Trade Debt $15,000 Principal Financial Group Trade Debt $13,511 Alfredo Soto Wages and Vacation $7,777 Pay IBEW 1245/Money Purchase Trade Debt $6,931 Pens. Alberto Martinez Wages and Vacation $5,206 Pay Valley Saw and Garden Equip. Trade Debt $4,727 Jose Llamas Wages and Vacation $4,612 Pay Alfredo Llamas Wages and Vacation $4,332 Pay Douglas Rhodes Wages and Vacation $4,092 Pay Juan Bribiesca Wages and Vacation $3,903 Pay Commercial Truck Co. Trade Debt $3,844 Armando Medina Wages and Vacation $3,694 Pay Jose Morales Wages and Vacation $3,676 Pay Felipe Huitron-Salcedo Wages and Vacation $3,440 Pay Santiago Torres Wages and Vacation $3,287 Pay ASSET SECURITIZATION: S&P Raises Class A-4 Ratings To BB -------------------------------------------------------- Standard & Poor's Ratings Services raised its ratings on four classes of Asset Securitization Corp.'s Commercial Mortgage Pass Through Certificates Series 1997-D5 and removed them from CreditWatch negative. At the same time, three other ratings are affirmed and removed from CreditWatch negative, and the rating on class A-8Z from the same transaction is raised. The ratings that were previously on CreditWatch are affirmed and raised due to the anticipation that interest due to the A-1 certificates will be received on a timely basis and the fact that accumulated interest shortfalls due to the A-2, A-3, and A-4 have been repaid. Nevertheless, the trust remains exposed to liquidity issues due to the ongoing Doctor's Hospital litigation. These liquidity issues have not impacted class A-8Z, as its future cashflow and rating are directly linked to the Comsat junior loan. The rating on class A-8Z is being raised due to the LTV improvement of the combined Comsat junior and senior loans due, primarily, to amortization since issuance. The interest shortfalls that the trust recently experienced were primarily the result of the recovery of non-recoverable advances by the master servicer, GMAC Commercial Mortgage Corp., relating to the Doctor's Hospital loan. Additional shortfalls have impacted the trust on a recurring basis due to costs associated with the trust's lawsuit against both the depositor and loan seller to repurchase the Doctor's Hospital loan. These costs have totaled $6.6 million to date, and it is possible that costs related to the trial phase of the litigation could cause payment interruptions to the certificates with ratings previously on CreditWatch. Should this occur, the ratings for all classes will be reviewed. As of June 16, 2004, the trust collateral consisted of 143 loans with an aggregate outstanding balance of $1,538.3 million, down from 155 loans totaling $1,754.0 million at issuance. GMACCM provided 2003 net cash flow debt service coverage figures for 86.8% of the pool. Based on this information Standard & Poor's computed a weighted average DSC of 1.47%, up from 1.39% at issuance. These figures exclude five defeased loans and 17 credit tenant lease loans. The trust has experienced five losses to date amounting to $28.4 million. The top 10 loans have an aggregate outstanding balance of $657.3 million (42.8%) and reported a 2003 weighted average DSC of 1.46x, down from 1.49x at issuance. The calculation excludes the Doctor's Hospital loan, the eighth largest loan in the pool (2.9%), which is in special servicing. No other top 10 loan is in special servicing, but the seventh largest loan is on the servicer's watchlist. The two top 10 loans secured by lodging assets both reported a DSC decline in excess of 10.0% since issuance; however, both loans reported a DSC in excess of 1.40x in 2003. There are seven assets with the special servicer, ORIX Capital Markets LLC that have an aggregate balance of $70.7 million. Doctor's Hospital is the largest of these assets and this loan is secured by a former 241-bed hospital in Hyde Park, Ill. with an outstanding principal balance of $44.6 million. The facility has been closed since April 2000. This loan has been the subject of extensive litigation, as the special servicer alleges, among other things, that the loan is not a qualified mortgage loan and insists that the depositor is obligated to repurchase it. GMACCM has made a non-recoverable determination with respect to advances on this asset. As a result, this loan creates a monthly interest shortfall of $360,000 for the trust. Additionally, Standard & Poor's estimates future litigation expenses related to this loan will average between $450,000 to $500,000 per month, which will add to the ongoing interest shortfall amount. The other specially serviced assets include a 167,000-sq.-ft. retail facility in San Antonio, Texas that is REO. This property was entirely occupied by Kmart and has an unpaid principal balance of $9.4 million (0.6%) and $1.3m million in additional exposure. This property was recently under contract but the sale did not materialize. As a result, this property will be combined with two other retail properties in a bulk sale. The trust owns another retail property located in Billings, Montana that was also formerly tenanted by Kmart. This 86,000-sq.-ft. facility has an outstanding balance of $1.8 million (0.1%), additional exposure of $100,000, and was transferred to the special servicer in 2002 due to imminent default, as it was on the initial Kmart store closing list; however, the borrower kept the loan current until October 2003. ORIX is also in foreclosure proceedings on a loan secured by a manufactured housing portfolio in Pennsylvania. This 227-pad portfolio has been in special servicing since 1999 and has an outstanding balance of $2.2 million (0.1%). One of the manufactured housing parks was liquidated for $2.0 million in April 2004 and proceeds were used to bring the loan current. The trust has certain legal obligations related to remedying water and sewer violation issues, which will adversely affect the ultimate recovery proceeds. Standard & Poor's anticipates substantial losses on the San Antonio Kmart asset as well as the manufactured housing portfolio and only a modest loss on the Billings Kmart property. The three remaining specially serviced loans amount to $12.8 million and none of these loans are delinquent. Standard & Poor's anticipates that these loans will return to the master servicer shortly or pre-pay in full with no loss to the trust. GMACCM's watchlist consists of 32 loans with an outstanding balance of $281.5 million (18.3%). Only one top 10 loan, the seventh largest loan in the portfolio, appears on the watchlist. This loan has a balance of $47.9m million (3.1%) and is secured by an 86,600-sq.-ft. office in Crystal City, Virginia. This loan reported a 2003 DSC of 1.30x and is on the watchlist because of a decrease in occupancy. Standard & Poor's recently approved the assumption of this loan by an entity that is controlled by a state pension fund that is expected to fund a substantial renovation program. The second largest loan on the watchlist is secured by an 803,200-sq.-ft. portfolio of office and industrial properties in New Jersey that has an outstanding balance of $40.3 million. This loan reported a 1.94x DSC in 2003. However, one tenant vacated 155,700 sq. ft. when its lease expired in December 2003 and two other tenants that occupy more than 180,000 sq. ft. will vacate when their respective leases expire in the next few months. The third largest loan on the watchlist is secured by a portfolio of 10 lodging assets consisting of 1,398-rooms with an aggregate balance of $35.7 million. This loan is on the watchlist because its DSC is below 1.20x; the portfolio generated a 2003 DSC of 1.17x, down from 1.19x in 2002. A 704-unit multifamily ortfolio located in Waco, Texas secures the only other loan on the watchlist with a balance in excess of 15.0m million. This loan has an outstanding balance of $23.0 million (1.5%) and reported a 2003 DSC of 1.01x, down from 1.12x in 2002. The remaining loans appear on the watchlist primarily due to DSC or occupancy issues. loans secured by lodging properties account for only 14.1% of the outstanding pool balance, yet make up 24.8% of the watchlist. The trust collateral is located across 36 states and is concentrated in Ohio (10.7%), New Jersey (9.2%), and Texas (9.1%). Property type concentrations can be found in retail (29.2%), office (27.8%), and multifamily (21.0%) assets. Standard & Poor's stressed the specially serviced assets, loans that appear on the watchlist, and other loans with credit issues, when appropriate, in its analysis. The resultant credit enhancement levels support the raised and affirmed ratings. Rating Raised Asset Securitization Corp. Commercial mortgage pass-thru certs series 1997-D5 Rating Class To From Credit Enhancement (%) A-8Z A- BBB- - Ratings Raised And Removed From Creditwatch Asset Securitization Corp. Commercial mortgage pass-thru certs series 1997-D5 Rating Class To From Credit Enhancement A-1E AAA AA-/Watch Neg 25.8% A-2 AA- BBB/Watch Neg 20.0% A-3 A- BBB-/Watch Neg 16.5% A-4 BB B/Watch Neg 14.8% Ratings Affirmed And Removed From Creditwatch Asset Securitization Corp. Commercial mortgage pass-thru certs series 1997-D5 Rating Class To From Credit Enhancement A-1B AAA AAA/Watch Neg 29.3% A-1C AAA AAA/Watch Neg 29.3% A-1D AAA AAA/Watch Neg 29.3% CALHOUN CBO: Fitch Maintains Senior Fixed Notes Ratings At C ------------------------------------------------------------ Fitch Ratings affirms the rating of one class of notes issued by Calhoun CBO, Ltd./Corp., which closed July 23, 1998. This affirmation is the result of Fitch's review process. The following rating actions are effective immediately: --$213,984,162 senior secured floating rate notes affirmed at 'BB-'; --$66,784,865 second priority senior fixed rate notes maintained at 'C'. Calhoun is a collateralized bond obligation managed by American Express Asset Management Group, Inc. The collateral of Calhoun is composed of high yield bonds with 81.07% invested in non-emerging markets assets and 18.93% in emerging markets assets. Payments are made semi-annually in January and July and the reinvestment period ended in July, 2003. Included in this review, Fitch discussed the current state of the portfolio with the asset manager and their portfolio management strategy. According to the April 23, 2004 trustee report, the collateral includes $23.19 million (10.21%) defaulted assets. The deal currently contains another $41.54 million (17.12%) assets rated 'CCC+' or below. The Senior Par Value Test is failing at 109.03% with a trigger of 127.50% and the Second Priority Par Value Test is failing at 83.09% with a trigger of 104.0%. The rating of the senior secured notes addresses the likelihood that investors will receive full and timely payments of interest, as per the governing documents, as well as the stated balance of principal by the stated maturity date. The rating of the second priority senior notes addresses the likelihood that investors will receive ultimate and compensating interest payments, as per the governing documents, as well as the stated balance of principal by the stated maturity date. CANADA PAYPHONE: Intends to Make Proposal to Creditors Under BIA ---------------------------------------------------------------- Subsequent to the Press Releases of Canada Payphone Corporation dated April 8, April 19 and May 6, 2004, announcing the filing of a Notice of Intention to make a proposal for the benefit of its creditors under the Bankruptcy and Insolvency Act and requesting an extension of 45 days, which was granted on May 5, 2004, the Company filed its restructuring plan proposal on June 16, 2004 and a creditor's meeting was held today. In order to permit further negotiations, at the request of the Company, the creditors agreed to adjourn the creditors' meeting to August 12, 2004. About the Company Canada Payphone Corporation is Canada's leading competitive payphone service provider. Over the past few years, Canada Payphone has played an instrumental role in the deregulation of the competitive payphone industry and continues to create exciting business opportunities in the new era of public access communications. In 1999, Canada Payphone began installing payphones across Canada. An experienced telecommunications team and the latest advancements in payphone technology provide Canada Payphone's customers with superior service and reliability. Canada Payphone Corporation is currently registered in the TSX Venture Exchange under the symbol 'CPY'. CANDESCENT TECH: Hires Pachulski Stang as Bankruptcy Attorneys -------------------------------------------------------------- Candescent Technologies Corporation and its debtor-affiliate ask the U.S. Bankruptcy Court for the Northern District of California for permission to hire Pachulski, Stang, Ziehl, Young, Jones & Weintraub PC as their general bankruptcy counsel. The Debtors tell the Court that the Firm's services are necessary for them to successfully reorganize under chapter 11 of the Bankruptcy Code. Pachulski Stang will: a. represent and appear for the Debtors concerning all matters concerning the administration of their bankruptcy cases; b. represent and appear for the Debtors with respect to motions to assume, assign or reject leases and other executory contracts; c. consult with the Debtors concerning bankruptcy issues with respect to specific lawsuits, adversary proceedings or contested matters in their bankruptcy cases, including contested objections to claims, disputes over the amounts owed in respect to executory contracts or leases and the obligations thereunder, and proceedings in which the Debtors are seeking the recovery of damages or avoidance of transfers; and d. provide services, in the Firm's sole and unfettered discretion, relating to other legal proceedings, cases, or matters, if requested by the Debtors. The attorneys and paralegals currently expected to be principally responsible for this matter, and their respective hourly rates are: Professional Billing Rate ------------ ------------ Robert B. Orgel $525 per hour Ramon M. Naguiat $265 per hour Patricia J. Jeffries $160 per hour Headquartered in Los Gatos, California, Candescent Technologies Corp. -- http://www.candescent.com/-- is a supplier of flat panel displays for notebook computers, communications and consumer products. The Company filed for chapter 11 protection on June 16, 2004 (Bankr. N.D. Calif. Case No. 04-53803). Ramon Naguiat, Esq., at Pachulski, Stang, Ziehl, Young et al represents the Debtors in their restructuring efforts. When the Company filed for protection from their creditors, they listed both estimated debt and assets of over $100 million each. CANDESCENT TECH: US Trustee Names 6-Member Creditors' Committee --------------------------------------------------------------- The United States Trustee for Region 15 appointed six creditors to serve on an Official Committee of Unsecured Creditors in Candescent Technologies Corporation's Chapter 11 cases: 1. AIM Advisors, Inc. 11 Greenway Plaza, Suite 100 Houston, Texas 77046 Attn: Robert G. Alley Bob.Alley@aiminvestments.com (713) 214-1845 2. Argent Financial Group (Bermuda) Ltd. 55 Vilcom Circle, Suite 200 Chapel Hill, North Carolina 27514 Attn: Bobby Richardson brichardson@argentclassic.com (919) 869-8650 3. Janus Capital Management 151 Detroit Street Denver, Colorado 80206 Attn: Heidi J. Walter (303) 394-7609 4. Oz Management, LLC 9 West 57th St., 39th Floor New York, New York 10019 Attn: Joel M. Frank jfrank@ozcap.com (212) 790-0160 5. U.S. Bank National Association (Indenture Trustee for Bond Debt) Corporate Trust Services Division One Federal Street, 3rd Floor Boston, Massachusetts 02110 Attn: Laura L. Moran laura.moran@usbank.com (617) 603-6429 6. U.S. Display Consortium 60 S. Market St., Suite 480 San Jose, California 95113 Attn: Michael Ciesinski usdc@usdc.org (408) 277-2400 Official creditors' committees have the right to employ legal and accounting professionals and financial advisors, at the Candescent Technologies Debtors' expense. They may investigate the Debtors' business and financial affairs. Importantly, official committees serve as fiduciaries to the general population of creditors they represent. Those committees will also attempt to negotiate the terms of a consensual chapter 11 plan -- almost always subject to the terms of strict confidentiality agreements with the Debtors and other core parties-in-interest. If negotiations break down, the Committee may ask the Bankruptcy Court to replace management with an independent trustee. If the Committee concludes reorganization of the Debtors is impossible, the Committee will urge the Bankruptcy Court to convert the Chapter 11 cases to a liquidation proceeding. Headquartered in Los Gatos, California, Candescent Technologies Corp. -- http://www.candescent.com/-- is a supplier of flat panel displays for notebook computers, communications and consumer products. The Company filed for chapter 11 protection on June 16, 2004 (Bankr. N.D. Calif. Case No. 04-53803). Ramon Naguiat, Esq., at Pachulski, Stang, Ziehl, Young et al represents the Debtors in their restructuring efforts. When the Company filed for protection from their creditors, they listed both estimated debt and assets of over $100 million each. CATHOLIC CHURCH: Hires Schwabe Williamson Litigation Counsel ------------------------------------------------------------ The Archdiocese of Portland in Oregon is named in 45 separate litigation matters involving alleged sexual abuse by various priests. From a monetary standpoint, the plaintiffs' claims constitute the majority of claims in the Debtor's chapter 11 case. "Representation of the Debtor in connection with these matters requires special knowledge of these claims," Archbishop John G. Vlazny tells the Bankruptcy Court. By this application, the Debtor seeks Judge Perris' permission to employ Schwabe Williamson & Wyatt, PC, in Portland, Oregon, as special counsel in its chapter 11 case. "Schwabe is infinitely familiar with these matters having represented the Debtor as lead counsel in all prepetition litigation," Archbishop Vlazny says. Schwabe has also served as the Debtor's general corporate counsel for many years. The four attorneys who'll work on this matter and their corresponding hourly rates are: Thomas Dulcich, Esq. $235 Margaret Hoffman, Esq. $235 James Finn, Esq. $235 Mario J. Madden, Esq. $185 Within the 12 months immediately preceding the Petition Date, the Archdiocese paid Schwabe $1,113,296 for legal services. This amount includes a $100,000 retainer. Mr. Dulcich assures the Court that he, his partners and his firm are disinterested within the meaning of Section 101(14) of the Bankruptcy Code as required under Section 327. Out of an abundance of caution, Mr. Dulcich discloses that his firm has represented, and received in the past 18 months, $13,873 from Oregon Catholic Press, $415 from Catholic Charities, and $51,044 from an unnamed insurance carrier on behalf of Catholic Charities. The Archdiocese of Portland in Oregon filed for chapter 11 protection (Bankr. Ore. Case No. 04-37154) on July 6, 2004. Thomas W. Stilley, Esq. and William N. Stiles, Esq. of Sussman Shank LLP represent the debtor in its restructuring efforts. When the debtor filed for chapter 11 protection, it listed estimated assets of $10,000,000 to $50,000,000 and estimated debts of $25,000,000 to $50,000,000. (Catholic Church Bankruptcy News, Issue No. 1; Bankruptcy Creditors' Service, Inc., 215/945-7000) CIRTRAN CORP: Opens Asia Headquarters for Cirtran-Asia Division --------------------------------------------------------------- CirTran Corp. (OTC BB: CIRT), an international full-service contract electronics manufacturer of printed circuit board assemblies, cables and harnesses, has opened an office in ShenZhen, China, establishing headquarters for its wholly owned subsidiary, CirTran-Asia Inc., to target the vast high-volume Asian manufacturing market. ShenZhen, a largely populated manufacturing hub, is located on the southern coastal region of China, approximately 35 kilometers from Hong Kong. This new office is in a Class A property that strategically positions CirTran-Asia to surround itself by some of the largest manufacturers in China, increasing our opportunities to pursue manufacturing relationships beyond printed circuit board assemblies, cables, harnesses and injection molding systems, and look for complete "box-build" or "turn-key" relationships in the electronics, retail and direct consumer markets. Trevor M. Saliba, executive vice president of worldwide business development of CirTran Corp., commented, "We are very excited about our new Asian headquarters. My colleague, Mr. Charles Ho, president of CirTran-Asia, has proven his ability to execute our company's strategies ahead of schedule. This office will be staffed with both sales and administrative professionals that will continue to pursue manufacturing relationships and manage our current ones." About CirTran Corp. Founded in 1993, CirTran Corp. has established itself as a premier full-service contract electronics manufacturer by building printed circuit board assemblies, cables and harnesses to the most exacting specifications. CirTran is headquartered in Salt Lake City, with a state-of-the-art 40,000 square foot facility. CirTran also provides "just-in-time" inventory management techniques that minimize the OEM's investment in component inventories, personnel and, related facilities, thereby reducing costs and ensuring speedy time to market. For further information about CirTran, visit the company's Web site located at http://www.cirtran.com/ At March 31, 2004, CirTran Corp.'s balance sheet shows a stockholders' deficit of $4,563,087 compared to a deficit of $4,941,251 at December 31, 2003. COEUR D'ALENE: Wheaton Does Not Intend to Negotiate with Coeur -------------------------------------------------------------- Wheaton River Minerals Ltd. (AMEX:WHT)(TSX:WRM) does not intend to enter into negotiations with Coeur d'Alene Mines Corporation at this time. To date, Coeur has attempted to make a take-over bid for Wheaton River by way of press release. When a formal tender offer is made, Wheaton will respond in due course as required by applicable law. "Over the last 30 months, Wheaton has increased its market capitalization from $20 million to $2.1 billion to become Canada's 6th largest and 2nd most profitable gold producer," said Ian Telfer, Chairman and CEO of Wheaton. "Wheaton's superb track record can be attributed to a strong growth strategy and we will continue to evaluate new opportunities," added Mr. Telfer. "There is no support for a Coeur/Wheaton combination from Wheaton's management, directors or shareholders," added Mr. Telfer. This sentiment is reinforced by comments from mining analysts. - Pierre Vaillancourt - Orion Securities Inc.: "We believe Coeur's existing bid for Wheaton River is insufficient. The risk profile of Coeur's assets combined with the future expenditures to develop new projects would result in excessive dilution to WRM shareholders." - Jim Taylor - Canaccord Capital Corporation: "We too believe that the combination of Wheaton and Coeur would not be in the long-term interests of WRM shareholders ....Coeur's premium rating as a silver company is unlikely to be sustainable for the merged group, as silver revenues would fall from 50% currently for Coeur to around the 20% level." - Tony Lesiak - UBS Investment Research: "...the CDE bid is dilutive to WRM on a cash flow, earning per share and net asset value basis, there are no synergies..." - Geoff Stanley - BMO Nesbitt Burns Research: "We do not believe that Coeur's offer is likely to succeed, nor do we view a merger as a desirable outcome for Wheaton shareholders." About Coeur d'Alene Coeur d'Alene Mines Corporation is the world's largest primary silver producer, as well as a significant, low-cost producer of gold. The Company has mining interests in Nevada, Idaho, Alaska, Argentina, Chile and Bolivia. As reported in the Troubled Company Reporter's June 3, 2004 edition, Standard & Poor's Ratings Services placed its B- corporate credit and senior unsecured debt ratings on Coeur D'Alene Mines Corp. on CreditWatch with positive implications following the company's announcement that it intends to acquire precious metals mining company Wheaton River Minerals Ltd. in a stock and cash transaction valued at approximately $1.8 billion. "The CreditWatch action reflects what is likely to be a meaningful improvement in Coeur's business and financial profile upon the successful acquisition of lower-cost producer Wheaton," said Standard & Poor's credit analyst Paul Vastola. Standard & Poor's expects that its ratings on Coeur would likely be raised several notches. Standard & Poor's will continue to monitor the transaction for any potential revisions to the deal. The deal remains subject to several conditions and is expected to close by Sept. 30, 2004. CONTINENTAL DIVIDE: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: Continental Divide Robotics, Inc. 2375 South Columbine Street Denver, Colorado 80210 Bankruptcy Case No.: 04-24227 Type of Business: The Debtor develops autonomous robotic systems. Chapter 11 Petition Date: July 1, 2004 Court: District of Colorado (Denver) Judge: Michael E. Romero Debtor's Counsel: Duncan E. Barber, Esq. Bieging Shapiro & Burrus LLP 4582 South Ulster Street Parkway, Suite 1650 Denver, CO 80237 Tel: 720-488-0220 Fax: 720-488-7711 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 ------ --------------- ------------ Terry Sandrin Loan $450,000 2375 S. Columbine St. Denver, CO 80210 Desmond Enterprises Trade debt $387,723 1551 S. Sunset St., #D Longmont, CO 80501 Premier Manufacturing Loan $275,000 1551 S. Sunset St., #D Longmont, CO 80501 Curriar Professional Trade debt $190,669 Services Royal Firman III Loan $175,000 Internal Revenue Service Trade debt $111,000 Hall Kinlon & Associates $54,000 Cargo Battery Trade debt $41,000 Royal Firman III Loan $40,000 MPD Trade debt $39,200 Verizon Wireless Trade debt $37,458 Tele Atlas North America, Lease $37,375 Inc. Benefactor Funding Trade debt $35,875 Aaron Johnson $35,589 TT Communications Trade debt $31,526 CS Communications Trade debt $30,000 MCI WorldCom Trade debt $27,459 Deutsche Financial Services Trade debt $27,000 Deutsche Financial Services Trade debt $24,456 American Express Blue $19,526 CORAM HEALTHCARE: FFF Enterprises Offers $225 Million in Cash ------------------------------------------------------------- Lawyers for FFF Enterprises, Inc., delivered copies of the company's Letters of Intent proposing to purchase all of Coram Healthcare Corp. and Coram, Inc.'s assets (excluding the estate's claims and causes of action against Cerberus Capital Management and Daniel Crowley) for $225 million in cash to the U.S. Bankruptcy Court for the District of Delaware. "Significantly," Richael J, Sitzer, Esq., at Rutan & Tucker, LLP, in Costa Mesa, California, representing FFF, tells Judge Walrath, "a sale of the Coram assets to FFF would provide for the continuing operation of the company, and the maximum retention of employees. FFF... understands the Coram business. FFF's NuFactor, Inc., subsidiary is a home infusion pharmacy specializing in delivering products and quality customer services to people with hemophilia and other chronic diseases directly to their homes. FFF would thus be a synergistic buyer for Coram and is committed to operating Coram as a going concern." FFF's offer is contingent on obtaining financing. FFF indicates that G.E. Capital and Ampersand Ventures have "indicated strong interest in providing debt and equity funding" for this transaction and will supply commitment letters on request. Currently, Arlin M. Adams, the Chapter 11 Trustee overseeing Coram's restructuring is attempting to prosecute his plan of reorganization to confirmation. Creditors have accepted the Chapter 11 Trustee's plan and equityholders have rejected it. The Equity Committee, led by Sam Zell, has proposed a competing plan of reorganization. The next omnibus hearing in Coram's chapter 11 cases is scheduled for July 19, 2004, at 2:00 p.m., in Wilmington, Delaware, before Judge Walrath. CREDIT SUISSE: Fitch Assigns Low Ratings to 6 Classes ----------------------------------------------------- Credit Suisse First Boston Commercial Trust 2004-FL1, commercial mortgage pass-through certificates are rated by Fitch as follows: --$191,453,000 class A 'AAA'; --$274,787,000 class A-X* 'AAA'; --$254,031,729 class A-Y-1* 'AAA'; --$254,031,729 class A-Y-2* 'AAA'; --$254,031,729 class A-Y-3* 'AAA'; --$36,753,000 class B 'AA'; --$15,812,000 class C 'A'; --$12,820,000 class D 'BBB+'; --$6,838,000 class E 'BBB'; --$11,111,000 class F 'BBB-'; --$13,248,000 class G 'BB+'; --$10,684,000 class H 'BB'; --$5,983,000 class J 'BB-'; --$5,555,000 class K 'B+'; --$4,701,000 class L 'B'; --$6,410,000 class M 'B-'; --$5,129,000 class N 'CCC'; --$14,384,729 class O not rated ('NR'); --$1,000,000 class P 'NR'. *Interest only. CROSSGEN ENTERTAIMENT: Sec. 341(a) Meeting Slated for Tomorrow -------------------------------------------------------------- The United States Trustee will convene a meeting of CrossGen Entertainment, Inc.'s creditors at 3:30 p.m., tomorrow, July 14, 2004, in Room 100-B at 501 East Polk St., Timberlake Annex, Tampa, Florida 33602. 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 Oldsmar, Florida, CrossGen Entertainment, Inc. -- http://www.crossgen.com/-- is a comic book publishing company. The Company filed for chapter 11 protection on June 18, 2004 (Bankr. M.D. Fla. Case No. 04-12478). Noel R. Boeke, Esq., and Rod Anderson, Esq., at Holland & Knight, LLP represent the Debtor in its restructuring efforts. When the Company filed for protection from its creditors, it listed estimated assets of over $1 million and debts of more than $10 million. DII: Halliburton Names Cedric Burgher Vice President and Treasurer ------------------------------------------------------------------ Halliburton (NYSE: HAL) announced that Cedric Burgher has been named the company's Vice President and Treasurer, and Paul Koeller has been named the company's Vice President, Investor Relations. Both appointments are effective June 21, 2004. As Treasurer, Mr. Burgher, 43, will be responsible for managing the company's global cash, debt, foreign exchange, capital structure, risk management, and customer credit and collection functions. Since September 2001, Mr. Burgher has been Halliburton's Vice President, Investor Relations. Prior to joining Halliburton, Mr. Burgher held a variety of financial management positions in the energy and banking sectors. He received his bachelor's degree from the University of Texas, his M.B.A. from the University of Dallas, and is a Chartered Financial Analyst. Mr. Burgher replaces Jerry Blurton who has been named Chief Financial Officer of Halliburton's KBR subsidiary effective July 1, 2004. Bruce Stanski, KBR's current Chief Financial Officer, will be promoted to lead KBR's government operations business at that time. In his new role, Mr. Koeller, 49, will oversee the company's communications and relationships with investors and analysts. Previously, he has served as a Vice President for Global Business Development in Halliburton's Energy Services Group. Mr. Koeller joined the Halliburton organization in 1996 through Landmark Graphics, as Director of Consulting for North and South America. Prior to his association with Landmark Graphics, Mr. Koeller served in various leadership positions within the management consulting group of Cap Gemini and as a geologist for Amoco Corporation. He received his Bachelor of Science degree in Geology from the University of Minnesota and has done graduate study at DePaul University and the University of Houston. "Cedric Burgher has done an outstanding job in managing investor and media relations during a challenging time in our organization's history," said Cris Gaut, Executive Vice President and Chief Financial Officer, Halliburton. "His broad energy and financial experience position him for success in this new role." "Paul Koeller will bring a fresh approach to our investor relations effort, drawing on his operations experience and his understanding of Halliburton's customer focused business approach," Gaut added. Founded in 1919, Halliburton is one of the world's largest providers of products and services to the petroleum and energy industries. The company serves its customers with a broad range of products and services through its Energy Services Group and Engineering and Construction business segments. Headquartered in Houston, Texas, Kellogg, Brown & Root is engaged in the engineering and construction business, providing a wide range of services to energy and industrial customers and government entities in over 100 countries. DII has no business operations. The Company filed for chapter 11 protection on December 16, 2003 (Bankr. W.D. Pa. Case No. 02-12152). Jeffrey N. Rich, Esq., Michael G. Zanic, Esq., and Eric T. Moser, Esq., at Kirkpatrick & Lockhart LLP, represent the Debtors in their restructuring efforts. (DII & KBR Bankruptcy News, Issue No. 15; Bankruptcy Creditors' Service, Inc., 215/945-7000) EL PASO: Subsidiary Receives Waiver of Indenture Default -------------------------------------------------------- El Paso Production Holding Company (EPPH), a subsidiary of El Paso Corporation (NYSE: EP), has entered into an agreement with the holders of a majority of its 7-3/4% Senior Notes due 2013, issued and outstanding under the indenture dated May 23, 2003. The agreement with the noteholders provides for a waiver of the breach by EPPH of its covenant to timely file its annual and quarterly reports with the Securities and Exchange Commission. The waiver will be effective until December 31, 2004. In connection with the waiver, EPPH has agreed to modify the covenants under this indenture with respect to affiliated party transactions. In particular, the agreement prohibits certain affiliated party transactions in excess of $100 million if the transactions would have a negative effect on EPPH's ratio of debt to proved reserves or its ratio of debt to EBITDA. The company does not anticipate these changes will impact the manner in which EPPH is managed. About the Company El Paso Corporation provides natural gas and related energy products in a safe, efficient, dependable manner. The company owns North America's largest natural gas pipeline system and one of North America's largest independent natural gas producers. As previously reported, Standard & Poor's Ratings Services lowered its corporate credit rating on natural gas pipeline and production company El Paso Corp. to 'B-' from 'B' to reflect a larger-than- expected write-down of the company's oil and natural gas reserves. The outlook remains negative. For more information, visit http://www.elpaso.com/ ENRON: EESI Seeks Court OK to Liquidate Komag Inc. Common Stock --------------------------------------------------------------- Enron Energy Services, Inc., seeks the Court's authority, pursuant to Section 363 of the Bankruptcy Code, to liquidate 49,802 shares of common stock in Komag, Inc., formerly known as HMT Technology Corporation, in the NASDAQ stock exchange, free and clear of all liens, claims and encumbrances. Prior to the Petition Date, Martin A. Sosland, Esq., at Weil, Gotshal & Manges, LLP, in New York, relates that EESI sold oil and gas to Komag through a commodity pricing contract. In November 2001, Komag filed a Chapter 11 petition. As of its Petition Date, Komag owed EESI $654,469 for oil and gas delivered, as well as $435,771 in mark-to-market losses under the Commodity Contract. Mr. Sosland reports that EESI filed a proof of claim in the Komag Bankruptcy Case, asserting $1,0920,240. The Claim was allowed and EESI received these distributions: (i) $89,147 in cash; (ii) $222,800 in interest bearing notes; and (iii) 49,802 shares of common stock. Early in 2004, Komag retired the Notes and paid EESI the outstanding principal and accrued interest. The Shares are currently held in a brokerage account managed by Wachovia. The market price of the Shares has fluctuated wildly in the past year, with reported trades as low as $10.31 and as high as $24.57. Mr. Sosland contends that liquidating the Shares will eliminate the price risk and convert the asset to cash for the benefit of EESI, its estate and creditors. Moreover, Mr. Sosland points out that EESI is not in the business of holding shares in publicly traded companies. As of June 17, 2004, the Shares were trading at $14.53, with a total market value of about $723,623. Selling the Shares at current market prices, when coupled with the cash payments already made by Komag, would result in EESI receiving almost full satisfaction on account of its Claim. (Enron Bankruptcy News, Issue No. 116; Bankruptcy Creditors' Service, Inc., 215/945-7000) FLEMING COS: General Mills Wants $980K Plus Expenses Reimbursed --------------------------------------------------------------- General Mills, Inc., on its own behalf and on behalf of Clorox Sales Co., ConAgra Foods, Inc., Conopco, Inc., Del Monte Corporation, Kimberly-Clark Corporation, Kraft Foods North America, Inc., Mars, Inc., Nestle USA, Inc., The Proctor & Gamble Distributing Co., Sara Lee Corporation, and S.C. Johnson & Son, Inc., as members of an ad hoc committee of reclamation claimants, seek reimbursement from the Fleming Companies Debtors' estates for the expenses they incurred in taking action up until the reconstitution of the Ad Hoc Committee as an official committee of reclamation claimants. The Ad Hoc Committee incurred $980,592.64 in administrative expenses, and up to an additional $10,000 in fees and expenses during the period from November 1, 2003 through February 25, 2004. Christian J. Singewald, Esq., at White and Williams, LLP, in Wilmington, Delaware, tells Judge Walrath that it is difficult to overstate the importance of the Ad Hoc Committee's role in the Debtors' cases. Because of the efforts of the Ad Hoc Committee and their professionals, the Debtors' cases will conclude with reorganization rather than liquidation. Not only was the Ad Hoc Committee instrumental in protecting the rights of more than 600 reclamation claimants, it played the key role in facilitating the creation of a confirmable plan of reorganization. The Committee's efforts resulted in a substantial contribution and, therefore, entitle them to compensation from the Fleming estates. The Ad Hoc Committee's effective organization of the reclamation creditors to act collectively has been instrumental in the progress toward a consensual plan, with apparent support from all major constituencies, rather than the more likely alternative of complicated, costly and time-consuming litigation, largely through the approximately 600 adversary proceedings with reclamation creditors. As a result, all constituencies and the Court itself have benefited. The consensual plan could not have been negotiated without the Official Committee of Reclamation Creditors. The Official Committee would not have been formed if the Ad Hoc Committee had not organized and assumed the burden of assuring that the rights of reclamation claimants were asserted. All of these actions were undertaken for the benefit of all reclamation creditors, at significant costs, and without any assurance of reimbursement. Formation of the Ad Hoc Committee The Committee was formed in July 2003, after the Debtors filed their first reclamation report, which contained many errors regarding the reclamation claims. However, the activities for which the Committee seeks an administrative claim began in November 2004, in connection with the Debtors' effort to pay $325 million to their prepetition secured lenders, and do away with reclamation claims in the process. Six of the more than 600 reclamation claimants, recognizing the potential prejudice to the rights of reclamation claimants -- who collectively held approximately 1/3 of all unsecured debt -- united and retained Piper Rudnick, LLP, and Blank Rome, LLP, to handle objections, hearings and negotiations to protect their reclamation rights. Each of the six claimants paid its per capita share of the fees and expenses incurred by the Ad Hoc Committee's professionals. By mid-December 2004, the Debtors took additional measures that revealed their determination to eliminate the reclamation claims. Faced with the Debtors' aggressive tactics and lack of representation or support by the Official Committee of Unsecured Creditors, six additional parties joined the Ad Hoc Committee. Thereafter, Piper Rudnick and Blank Rome continued to act as the Committee's counsel, and each of the current 12 members was responsible for their per capita share of the resulting fees and expenses. In addition, the Ad Hoc Committee hired J. H. Cohn, LLP, to perform accounting and financial advisory services. Cohn's fees also were divided equally among the Ad Hoc Committee members. The Court ultimately granted official status to the Ad Hoc Committee and approved the retention of counsel and Cohn for the Official Committee. The Committee's Contributions The Ad Hoc Committee protected trade creditor rights and helped create a confirmable plan. Throughout their cases, the Debtors engaged in repeated efforts through, among other devices, motions and plan provisions, to eliminate or severely impair reclamation rights and certain other rights of trade creditors, including set-off rights. This course of conduct consumed substantial judicial, estate and individual creditor resources, and threatened the rights of hundreds of small reclamation creditors which could not afford to mount a defense to the Debtors' tactics. The Ad Hoc Committee played an essential role in the responses, objections, and negotiations that resulted in the repeated vindication of reclamation creditor rights and in the conservation of judicial, estate and creditor resources. The Ad Hoc Committee accomplished these goals in spite of resistance from the Debtors, the Unsecured Creditors Committee, and, on occasion, the United States Trustee. As was acknowledged when the Court ordered the creation of the Official Committee to replace the Ad Hoc Committee, the work the Ad Hoc Committee performed benefited not only its members but also the entire estate. The Ad Hoc Committee's work facilitated the creation of a workable reorganization plan, resulting in significant cost savings for all involved, and in a greater recovery for creditors. Now that the benefits of these efforts are soon to be realized by the estates and all creditors, the Ad Hoc Committee should not be penalized by having their recoveries reduced because each member bore a share of the expenses incurred on behalf of and for the benefit of those reclamation creditors which could not afford to contribute, or those "free riders" which may have been able to contribute, but deferred. The Ad Hoc Committee's fees and expenses to date are: Professional Fees Expenses Total ------------ ---- -------- ----- Piper Rudnick $755,384.40 $39,244.25 $794,628.65 Blank Rome 64,497.00 5,792.30 70,289.30 J. H. Cohn 114,395.50 1,279.19 115,674.64 ----------- ---------- ----------- $934,276.90 $46,315.74 $980,592.64 Headquartered in Lewisville, Texas, Fleming Companies, Inc. -- http://www.fleming.com/-- is the largest multi-tier distributor of consumer package goods in the United States. The Company filed for chapter 11 protection on April 1, 2003 (Bankr. Del. Case No. 03-10945). Richard L. Wynne, Esq., Bennett L. Spiegel, Esq., Shirley Cho, Esq., and Marjon Ghasemi, Esq., at Kirkland & Ellis, represent the Debtors in their restructuring efforts. When the Debtors filed for protection from its creditors, they listed $4,220,500,000 in assets and $3,547,900,000 in liabilities. (Fleming Bankruptcy News, Issue No. 38; Bankruptcy Creditors' Service, Inc., 215/945-7000) FOOTSTAR: Enters Agreement to Sell Mira Loma Distribution Center ---------------------------------------------------------------- Footstar, Inc. has entered into a definitive agreement to sell the Company's distribution center in Mira Loma, California, and to outsource certain warehousing and distribution operations to support the ongoing needs of the Company's Meldisco division. The Mira Loma facility will be acquired by Alere Property Group LLC, a real estate company specializing in California industrial real estate. Alere will, in turn, lease the land and buildings to FMI International LLC, a leading third-party provider of logistics services to the fashion, footwear and retail industries. FMI will purchase the materials handling equipment in the Mira Loma facility, and provide warehousing and distribution services to the Company's Meldisco division under an eight-year agreement. The total proceeds to Footstar in connection with the sale is expected to be approximately $20 million. The transaction is subject to Bankruptcy Court approval and is expected to close as soon as practicable once Court approval is received. The Company has requested a hearing date for July 19, 2004. Dale W. Hilpert, Chairman, President and Chief Executive Officer, said, "This agreement is another step in the re-positioning of the Company as we develop our plan of reorganization so we can emerge from Chapter 11 and maximize value for our stakeholders. We are pleased to have secured continuous logistics services at the Mira Loma distribution center through FMI and are delighted that FMI has extended employment offers to all associates at the Mira Loma facility. We look forward to completing the transaction as soon as possible." About Footstar, Inc. Footstar, Inc. -- http://www.footstar.com/-- which filed for Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case No.: 04- 22350) on March 3, 2004, is a leading footwear retailer. As of May 1, 2004, the Company operates 2,498 Meldisco licensed footwear departments nationwide and 36 Shoe Zone stores. The Company also distributes its own Thom McAn brand of quality leather footwear through Kmart, Wal-Mart and Shoe Zone stores. Paul M. Basta, Esq. of Weil Gotshal & Manges represents the debtor in its restructuring efforts. When the company filed for bankruptcy protection, it listed total assets of $762,500,000 and total debts of $302,200,000. FOSTER WHEELER: Extends Common Shares Tender Offer to July 30 ------------------------------------------------------------- Foster Wheeler Ltd.(OTCBB:FWLRF) is extending, until 5 p.m. New York City time on Friday, July 30, 2004, its offer to exchange: (1) its Common Shares and its Series B Convertible Preferred Shares for any and all outstanding 9.00% Preferred Securities, Series I issued by FW Preferred Capital Trust I (liquidation amount $25 per trust security) and guaranteed by Foster Wheeler Ltd. and Foster Wheeler LLC, including accrued dividends; (2) its Common Shares and Preferred Shares for any and all outstanding 6.50% Convertible Subordinated Notes due 2007 issued by Foster Wheeler Ltd. and guaranteed by Foster Wheeler LLC; (3) its Common Shares and Preferred Shares for any and all outstanding Series 1999 C Bonds and Series 1999 D Bonds (as defined in the Second Amended and Restated Mortgage, Security Agreement, and Indenture of Trust dated as of October 15, 1999 from Village of Robbins, Cook County, Illinois, and to SunTrust Bank, Central Florida, National Association, as Trustee); and (4) its Common Shares and Preferred Shares and up to $150,000,000 of Fixed Rate Senior Secured Notes due 2011 of Foster Wheeler LLC guaranteed by Foster Wheeler Ltd. and certain Subsidiary Guarantors for any and all outstanding 6-3/4% Senior Notes due 2005 of Foster Wheeler LLC guaranteed by Foster Wheeler Ltd. and certain Subsidiary Guarantors; and solicitation of consents to proposed amendments to the indenture relating to the 9.00% Junior Subordinated Deferrable Interest Debentures, Series I of Foster Wheeler LLC, the indenture relating to the 6.50% Convertible Subordinated Notes due 2007 and the indenture relating to the 6-3/4% Notes due 2005. As of the close of business on July 8, 2004, holders have tendered the following amounts of the following securities: (A) 9.00% Preferred Securities, $2,513,675; (B) 6.50% Convertible Subordinated Notes, $23,000; (C) Robbins Series C Bonds due 2024, $21,000, Robbins Series C Bonds due 2009, $7,000, and Robbins Series D Bonds, $2,000; and (D) 6-3/4% Senior Notes, $7,093,000. As previously announced, Foster Wheeler intends to modify the terms of the exchange offer. The modified terms and conditions of the exchange offer are set forth in Foster Wheeler's registration statements on Form S-4 (File Nos. 333-107054 and 333-117244) filed on July 8, 2004. The amended exchange offer is subject to review by the Securities and Exchange Commission and other regulatory agencies, and revised offering materials will be distributed as soon as practicable. The dealer manager for the exchange offer and consent solicitation is Rothschild Inc., 1251 Avenue of the Americas, 51st floor, New York, New York 10020. Contact Rothschild at 212-403-3784 with any questions on the exchange offer. The exchange agent for the exchange offer is the Bank of New York, London Branch. The foregoing reference to the proposed registered exchange offer and any other related transactions shall not constitute an offer to buy or exchange securities or constitute the solicitation of an offer to sell or exchange any securities in Foster Wheeler Ltd. or any of its subsidiaries. Investors and security holders are urged to read the following documents filed with the SEC, as amended from time to time, relating to the proposed exchange offer because they contain important information: (1) the registration statements on Form S-4 (File Nos. 333-107054 and 333-117244) and (2) the Schedule TO (File No. 005-79124). These and any other documents relating to the proposed exchange offer, when they are filed with the SEC, may be obtained free at the SEC's Web site at http://www.sec.gov/You may also obtain these documents for free (when available) from Foster Wheeler by directing your request to: John A. Doyle; email john_doyle@fwc.com; telephone 908-730-4270; and address Foster Wheeler Inc., Perryville Corporate Park, Clinton, NJ 08809-4000. About Foster Wheeler Foster Wheeler Ltd. -- whose December 26, 2003 balance sheet shows a total shareholders' deficit of $872,440,000 -- is a global company offering, through its subsidiaries, a broad range of design, engineering, construction, manufacturing, project development and management, research and plant operation services. Foster Wheeler serves the refining, oil and gas, petrochemical, chemicals, power, pharmaceuticals, biotechnology and healthcare industries. The corporation is based in Hamilton, Bermuda, and its operational headquarters are in Clinton, New Jersey, USA. For more information about Foster Wheeler, visit http://www.fwc.com/ FRESH CHOICE: Plans to File Voluntary Petition Under Chapter 11 --------------------------------------------------------------- Fresh Choice, Inc. (Nasdaq:SALD) announced a strategic shift toward focusing on its core markets and its intention to file a voluntary petition to reorganize under Chapter 11 of the U.S. Bankruptcy Code in the Bankruptcy Court for the Northern District of California on Monday, July 12, 2004. The Company will continue to operate 46 restaurants primarily located in Northern California. In anticipation of this filing, Fresh Choice's Board of Directors has elevated Tim O'Shea to the new position of President and COO and promoted David E. Pertl to Executive Vice President and CFO. Mr. O'Shea was formerly Fresh Choice's Executive Vice President and COO and Mr. Pertl was Senior Vice President and CFO. Everett (Jeff) Jefferson will continue with the Company in the role of Chief Executive Officer and will focus his attention on the reorganization. Mr. Jefferson said, "As a first step in our reorganization, Fresh Choice closed 10 of its 56 locations. These locations, which were closed last week, were primarily located in Southern California, Texas and Washington. We continue to operate 31 restaurants in our core Northern California market, as well as 6 in Southern California, 2 in Washington and 7 in Texas." Mr. Jefferson said further, "The Company intends to seek protection under Chapter 11 of the U.S. Bankruptcy Code in order to facilitate a reorganization of our remaining 46 operations and a restructuring of our financial affairs. We firmly believe that upon emerging from Chapter 11, Fresh Choice will be stronger in terms of cash flow and operating flexibility." Mr. Jefferson concluded, "We will continue to focus on providing an exceptional dining experience to every guest. We are fortunate to have very dedicated employees who I am confident will continue to focus on our 'guest-first' philosophy." Fresh Choice, Inc. continues to operate 46 restaurants 43 of which are under the Fresh Choice and Zoopa brand names in California (37), the state of Washington (2) and Texas (4). The Company's Fresh Choice and Zoopa restaurants offer customers an extensive selection of high quality, freshly-prepared traditional and specialty salads, hot pasta dishes, pizza, soups, bakery goods and desserts in a self-service format. In addition, the Company operates one Fresh Choice Express restaurant, one dual branded Fresh Choice Express and licensed Starbucks retail store and one stand-alone licensed Starbucks retail store in Texas. * * * In its Form 10-Q for the quarterly period ended March 21, 2004 filed with the Securities and Exchange Commission, Fresh Choice, Inc. reports: Liquidity and Capital Resources "The Company's primary capital requirements have been for the expansion of its restaurant operations and remodeling of its restaurants. The Company has traditionally financed these requirements with funds from equity offerings, cash flow from operations, landlord allowances, capital equipment leases and short-term bank debt. The Company does not have significant trade receivables or inventory and receives trade credit based upon negotiated terms in purchasing food and supplies. "The Company intends to finance its operating cash requirements and fiscal 2004 capital requirements through existing cash balances, cash provided by operations and its borrowing arrangements. However, the Company's operating cash flow is impacted by the Company's comparable store sales increases or decreases as well as the Company's newer restaurants' sales performance. The Company's comparable store sales increased 1.2% in the first quarter of 2004 but the average sales of the seven newer stores, opened less than eighteen months and open for both lunch and dinner, averaged 37.9% below the comparable-store average sales. The Company expects comparable store sales to continue to improve and the sales performance of its newer restaurants to improve, but there can be no assurance that comparable store sales will improve or newer restaurant sales will improve. In addition, the Company may seek additional financing to provide greater flexibility. There can be no assurance that the Company will be able to obtain additional financing when needed on acceptable terms or at all. To the extent operating cash flow declines, or financing cannot be obtained, the Company intends to further curtail its capital spending plans in 2004 and beyond." GLOBALNET INTERNATIONAL: Has Until August 14 to File Schedules -------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York, gave GlobalNet International, LLC and its debtor-affiliates more time to file their schedules of assets and liabilities, statements of financial affairs and lists of executory contracts and unexpired leases required under 11 U.S.C. Sec. 521(1). The Debtor has until August 14, 2004 to prepare and deliver these financial disclosure documents. Headquartered in New York, New York, GlobalNet International LLC is engaged in the wholesale global telecommunications business. The Company filed for chapter 11 protection on June 30, 2004 (Bankr. S.D. N.Y. Case No. 04-14488). Scott S. Markowitz, Esq., at Todtman, Nachamie, Spizz & Johns, P.C., represents the Debtor in its restructuring efforts. When the Company filed for protection from its creditors, it listed estimated assets of over $1 million and estimated debts of more than $10 million. GULFMARK OFFSHORE: S&P Assigns Proposed $155M Note Rating at BB- ---------------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'BB-' corporate credit and senior unsecured ratings on GulfMark Offshore Inc. and assigned its 'BB-' rating to GulfMark's proposed $155 million senior unsecured offering due 2014. The outlook remains negative. The ratings affirmation follows a review of GulfMark in light of the proposed refinancing of its existing $130 million notes due 2008 with the issuance of $155 million senior notes due 2014. "Proceeds from the proposed notes exceeding any redemption premiums and financing fees, roughly $18 million, will be used to repay outstanding borrowings on GulfMark's credit facility and for general corporate purposes," noted Standard & Poor's credit analyst Paul B. Harvey. "In Standard & Poor's review of the $155 million senior notes, no notching was taken, despite its junior position to the secured credit facility," he continued. GulfMark is a provider of premium offshore vessels, with a fleet consisting of 52 vessels as of June 30, 2004. GulfMark's strategy is to focus on modern, technologically advanced vessels that can be employed on a term basis, emphasizing geographic regions with deepwater areas where there is long-term structural development and production work. GulfMark's North Sea market (71% of 2003 revenues) is its mainstay, and its Southeast Asian (17% of revenues) and Brazilian (12% of revenues) markets provide diversity and the potential for growth in its deepwater fleet. The negative outlook reflects GulfMark's reduced cash flow and increased borrowings from its credit facility. Standard & Poor's expects that new-vessel spending will be limited to the current three vessels under construction, and that GulfMark will focus on debt repayment in 2005. If GulfMark continues its fleet expansion at the expense of debt repayment, ratings would be lowered. HARTCOURT COMPANIES: Auditors Raise Going Concern Doubt ------------------------------------------------------- The Hartcourt Companies, Inc. signed a definitive agreement to purchase 51% percent equity interest in ServiceNet. The Company said 3,576,751 common shares and RMB3 Million (US$364,000) in cash had not been issued or paid as of March 31, 2004. Hartcourt's principal capital requirements during the year 2004 are to fund (by issuing additional stock) the acquisitions of growth and profitable, IT related operating companies in China. During the three months ended March 31, 2004, Hartcourt raised necessary funds to carry out its plans of acquisitions by selling its own common shares to selected investors and bringing in business partners whose contributions included the necessary cash. As shown in the Company's financial statements, Hartcourt incurred a net gain of $57,842 for the three months ended March 31, 2004 as compared to a net loss of $186,916 for the same period in 2003. In addition, Hartcourt's current assets exceeded its current liabilities by $11,101,999 at March 31, 2004. All above factors show that Hartcourt has improved substantially on its cash flow position. However, to support the expansion plan of existing subsidiaries in the IT Product Marketing business and to meet Hartcourt's requirements in its acquisition plan, the Company has continued to raise funds from capital markets. The plan includes: 1) settlement of all outstanding litigation and disputes. 2) raise funds in private placements. As of March 31, 2004, Hartcourt had working capital of US$11,101,999. Its working capital requirements over the next 12 months will include capital necessary for capital injection into the current business due to expansion and for making additional acquisitions. In addition to working capital on hand, management believes that the Company will need an additional $3 to $4 million of working capital to fund its proposed plan of operations. Management intends to obtain the required capital through a combination of bank debt and sales of Company equity securities. However, there are no commitments or agreements on the part of anyone to provide Hartcourt with additional bank financing or to purchase its securities. If unable to raise the additional $2 to $3 million of working capital, Hartcourt's proposed plan of operations may be adversely affected. The report of the Company's independent accountants for the fiscal year ended December 31, 2003 states that due to recurring net losses from operations and the absence of an established source of revenue, there is substantial doubt about Hartcourt's ability to continue as a going concern. The Hartcourt Companies, Inc., incorporated in Utah in 1983, is a growth oriented company in the China's IT distribution and retail sectors. There are four main operations in this sector which are all located in China: 1) HuaQing Corporate Development Co., Ltd., located in Shanghai, China, a key distributor for Samsung Electronics, helps customers build their own PC system with components, technology and after sales support, 2) Guangdong NewHuaSun Computer Co., Ltd., a similar business to HuaQing, located in the Guangdong province covering the Southern China market, 3) Shanghai GuoWei Science and Technology Co., Ltd., a PC retailer in the Shanghai area with 13 retail outlets, and 4) Wenzhou ZhongNan Computer Group, a PC retailer covering the Zhejiang province. Through the strategic acquisition of controlling interest in profitable companies with leadership positions in regional markets, Hartcourt intends to integrate and consolidate the businesses to reach economy of scale and operating efficiency. HUDSON STRAITS: S&P Rates Class E Deferrable Notes at BB -------------------------------------------------------- Standard & Poor's Ratings Services assigned its preliminary ratings to Hudson Straits CLO 2004 Ltd./Hudson Straits CLO 2004 Corp.'s $413 million floating-rate notes and preference shares due 2015. The preliminary ratings are based on information as of July 9, 2004. Subsequent information may result in the assignment of final ratings that differ from the preliminary ratings. The preliminary ratings reflect: -- The credit enhancement provided to each class of notes through the subordination of cash flows to more junior classes; -- The transaction's cash flow structure, which has been subjected to various stresses requested by Standard & Poor's; -- The experience of the servicer; and -- The legal structure of the transaction, including the bankruptcy remoteness of the issuer. Preliminary Ratings Assigned Hudson Straits CLO 2004 Ltd./Hudson Straits CLO 2004 Corp. Class Rating Amount (mil. $) A-1 variable funding note AAA Up to 90.0 A-2 AAA 200.0 B AA 31.5 C deferrable A 23.5 D deferrable BBB 23.0 E deferrable BB 10.0 Preference shares N.R. 35.0 N.R.-Not rated. HUMANA TRANS: Net Losses Trigger Going Concern Doubt ---------------------------------------------------- Humana Trans Services Holding Corporation incurred recurrent net losses -- $3,906,934 for the six months ended March 31, 2004, and $3,746,760 for the three months ended March 31, 2004. At March 31, 2004, current liabilities exceed current assets by $1,404,562. Financing recently has been from stockholder advances, factoring of accounts receivable and equity capital. These factors raise substantial doubt about the Company's ability to continue as a going concern. It is the intention of the Company's management to improve profitability by significantly reducing operating expenses and to increase revenues significantly, through growth and acquisitions. The Company anticipates that in order to fulfill its plan of operation, including payment of certain past liabilities of the Company, it will need to seek financing from outside sources. The Company is currently pursuing a private and public placement of equity and also is actively pursuing discussion with one or more potential acquisition or merger candidates. There is no assurance that the Company will be successful in raising the necessary funds nor is there a guarantee that the Company can successfully execute any acquisition or merger transaction with any company or individual or if such transaction is effected, that the Company will be able to operate such company profitably or successfully. The ultimate success of these measures is not reasonably determinable at this time. These factors raise substantial doubt about the Company's ability to continue as a going concern. On May 7, 2004, Humana entered into a Letter of Intent with Emcore Professional Employers, Inc., of Greenville, North Carolina, whereby the Company will acquire 100% of the issued and outstanding shares of common stock of Emcore, for approximately 60% of the then issued and outstanding shares of Humana. The Letter of Intent is contingent upon certain conditions, one of which is the obtaining of $5,000,000 of equity financing, along with the proposed "spin-out" of the recruiting and staffing business of the Humana. The transaction must close by August 30, 2004, unless extended by mutual consent for an additional period of ninety (90) days. Humana Trans Services Holding Corp., formerly Steam Cleaning USA, Inc., formerly TTI Holdings of America Corp was incorporated in November 1994 under the laws of the State of Delaware under the name Thermaltec International, Corp. On May 18, 2001, Thermaltec changed its name to TTI Holdings of America Corp. From its inception until July 2001, TTI was primarily engaged in the thermal spray coating industry in the U.S. and Costa Rica. In July 2001, TTI divested the operations of its thermal spraying business, formerly consolidated in its wholly-owned subsidiary Panama Industries, Ltd, to its shareholders of record as of June 22, 2001 in the form of a stock dividend on the basis of one (1) share of Panama for every three (3) shares of TTI owned (the "Panama Spin-off"). Accordingly, as of July 2, 2001, TTI was no longer in the thermal spraying business and has been operating as a holding company focused on developing new business opportunities. INDEPENDENCE COURT: US Trustee to Meet with Creditors on Aug. 3 --------------------------------------------------------------- The United States Trustee will convene a meeting of Independence Court of Ormond Beach Associates LP's creditors at 1:30 p.m., on August 3, 2004 in Suite 1-200 at 300 North Hogan Street, Jacksonville, Florida 32202. 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 Pittsburgh, Pennsylvania, Independence Court of Ormond Beach Associates LP operates an assisted living facility. The Company filed for chapter 11 protection on June 21, 2004 (Bankr. M.D. Fla. Case No. 04-06355). Albert H. Mickler, Esq., at Mickler & Mickler represents the Debtor in its restructuring efforts. When the Company filed for protection from its creditors, it listed $342,120 in total assets and $6,185,065 in total debts. INTERPOOL INC: Fitch Assigns CCC+ Ratings To Preferred Stock ------------------------------------------------------------ Fitch Ratings affirms Interpool, Inc.'s senior secured, senior unsecured, and preferred stock ratings at 'BB-', 'B', and 'CCC+', respectively. The ratings are removed from Rating Watch Negative where they were placed on Oct. 10, 2003. The Rating Outlook is Positive. Approximately $322 million of debt and trust-preferred securities are affected by Fitch's action. The Rating Watch Negative was removed as Interpool has completed its financial restatement for fiscal years 2000, 2001, and 2002 with a negligible impact to credit fundamentals. While the company is not yet current with its Securities and Exchange Commission financial statement filings, Fitch has gained confidence that the company is ahead of the schedule announced in November 2003 to be in compliance with SEC financial statement reporting deadlines by the end of 2004. Interpool has also been successful at maintaining an acceptable liquidity position through sourcing new secured financing and consistent retention of meaningful unrestricted cash balances. The Positive Rating Outlook reflects Fitch's view that Interpool will continue its progress at becoming a timely SEC filer and also considers an expected strengthening of the company's information technology, accounting, and legal infrastructure resulting from the implementation of recommendations from Morrison and Foerster, LLP's forensic review of the company's operations. These improvements, when completed, will enable the company to better monitor, manage, and track equipment as well as improve the efficiency and integrity of its billing and cash management systems. Other strengths focus on the company's liquidity position. Despite full utilization of its revolving credit facility, Interpool has over $100 million of unrestricted cash on hand, in addition to generating roughly $40 million-$50 million of cash from operations before capital expenditures, on a quarterly basis. Combined, these should be sufficient to address the company's debt service requirements over the next 12 months. However, Interpool is also in the process of negotiating additional financings that would, over the long term, simplify the capital structure and provide additional liquidity resources. Completion of any new financings, in addition to providing additional liquidity, would allow opportunities to accelerate growth of the equipment fleet. However, depending upon the terms and conditions, they may cause the notching between the secured and unsecured ratings to be expanded. Fitch also believes that Interpool's core balance sheet fundamentals remain adequate. As the company has not been aggressively growing its equipment fleet while at the same time repaying debt, financial leverage has declined. Fitch believes that leverage, defined as debt divided by equity with 65% equity credit to the $75 million trust-preferred security, has declined to below 3.65 times (x) as of June 30, 2004 from 4.01x at Sept. 30, 2003. Interpool's risk-adjusted capitalization also remains strong, as the adjusted-to-required equity ratio has been near 1.0x over the past several years. Interpool is also facing favorable conditions in both the intermodal container and chassis leasing businesses. Fiscal 2004 has seen new container prices increase by approximately 40% and, more importantly, prices are now higher than they were in 1999. Many containers leased in 1999 are now up for renewal in 2004. Due to the nearly one to one correlation of container prices to lease rates, it is anticipated that Interpool may be able to improve its lease margins for containers subject to lease renewal. However, the company's strategy of leasing containers predominantly on a long-term basis means that only a small portion of the fleet renews each year, and therefore, a noticeable earnings boost should not be expected in the short term. Nevertheless, Fitch views Interpool's long-term leasing strategy favorably as it can help mute income volatility over time. Concerns center on Interpool's delinquent SEC financial filing status. Should the company fail to complete its 2003 10-K by Aug. 31, 2004, it would be forced to seek another round of waivers from its bank group. Fitch notes that creditors have been cooperative in the past when many of the company's credit metrics were weaker and greater uncertainty surrounded Interpool's future direction. Additional concerns center on the company's limited supply of unencumbered assets. Some previously unpledged assets have been pledged to secured lenders over the past nine months to secure new financing. While this has afforded time to complete the restatement of the 2000, 2001, and 2002 financials, it has affected the position of senior unsecured creditors in the capital structure. Other concerns focus on Interpool's lack of access to the public equity capital markets. While leverage and capitalization is currently solid, lack of access to public equity capital limits the ability to grow assets at a rate beyond the company's own internal capital formation rate. Fitch also believes that Interpool has modestly increased its cost base through the hiring of additional accountants, legal staff, information technology staff, and the engagement of additional internal auditors, as well as the deployment of new computer hardware and software. These additions, while necessary to support the company's operational integrity, may have a modest impact on profit margins. Tracing its roots to 1968 and based in Princeton, NJ, Interpool, Inc., through its subsidiaries, is the largest lessor of domestic chassis and, in combination with 50% owned subsidiary Container Applications International, the largest lessors of marine containers in the world. KIWA BIO: Inks Letter of Intent With Reforestation Technologies --------------------------------------------------------------- Kiwa Bio-Tech Products Group Corporation (OTCBB:KWBT) signed a cooperative Letter of Intent with Salinas, California based Reforestation Technologies International, Inc. The LOI is intended as a marketing agreement whereby KIWA will market RTI's products in the China market utilizing its sales and distribution channels. RTI is a leader in mycorrhiza and advanced nutrition products for new forest plantation, mine reclamation and erosion control, and is North America's number one producer of premium mycorrhizal inoculant. Their Planter Pak Technology combines a sophisticated blend of controlled release fertilizers in a simple and highly effective "Root Zone Delivery" system. Planters Paks are safe to handle, economical and been shown to consistently increase plant biomass by 240% to 400% over non-treated seedlings in the first three to five years. RTI's proven technology has been used for over a decade in Reforestation, Mine Reclamation, Land Restoration and Ornamental Applications. Wei Li, Chairman and CEO of KIWA stated, "KIWA is pleased to enter into this alliance with RTI. Their premium mycorrhizal products are best used in native vegetation restoration, forestry and agriculture due to their ability to form an extensive hyphal network in soil." Li continued, "Desertification has been claiming land at the speed of 600,000 acres per year in China since the 1990s. Currently, total desertification in China stands at 650,000,000 acres, which is 27.3% of the total area of the country. Among this land, close to 20,000,000 acres are arable lands. Reforestation has been a continuous effort that may reach up to 7,000,000 acres per year." Li added, "To enhance our product offerings and shorten the product development cycle, Kiwa is continuously focused on forming relationships with selected companies in the United States whose products complement what KIWA is already doing in China. By increasing the number and diversity of products we offer to the marketplace, KIWA will establish itself as a key supplier of bio-agricultural products in China and eventually in the US markets as well." For more information on KIWA and its products, please refer to the website at: http://www.kiwabiotechgroup.com/ About KIWA Bio-Tech Products Group Corporation KIWA develops, manufactures and distributes innovative, cost- effective, and environmentally-safe bio-technological products to agricultural and environmental protection markets. The Company's goal is to have people in China and elsewhere in the world eat healthier, drink cleaner and live longer. The Company is a pioneer in commercialization of biotechnology, having an offshore manufacturing base in Shandong Province, China and distributing bio-tech products worldwide. As reported in the Troubled Company Reporter's June 17, 2004 edition, on May 5, 2004, the Board of Directors of Kiwa Bio-Tech Group Corporation resolved to dismiss Pritchett, Siler & Hardy, P.C. as its independent public accountants. In addition, on May 5, 2004, the Company's Board of Directors resolved to engage Grobstein, Horwath & Company LLP as the Company's new independent accountants to audit its financial statements for the fiscal year ended December 31, 2004. The change was made as a result of the previously announced merger of the Kiwa Bio-Tech and Kiwa Bio- Tech Products Group, Ltd., which became effective on March 12, 2004. Pritchett, Siler & Hardy, P.C.'s report on the Company's consolidated financial statements for the fiscal year ended December 31, 2003, included an explanatory paragraph expressing concern about the Company's ability to continue as a going concern. LAIDLAW: IRS Wants Court to Allow $8 Million Claim -------------------------------------------------- Henry J. Riordan, Trial Attorney of the Tax Division of the U.S. Department of Justice, in Washington, D.C., argues that the Internal Revenue Service can't be sued. According to Mr. Riordan: -- the Reorganized Debtors failed to state a claim on which protection may be granted in regard to the withdrawn or dismissed tax claims; -- the Reorganized Debtors' suit for a tax refund and objection to the allowance of any withdrawn or dismissed tax claims is barred by the sovereign immunity of the United States; -- the Reorganized Debtors failed to file a claim for tax refund in accordance with Section 7422 of the Internal Revenue Code and Section 505(a)(2) of the Bankruptcy Code; -- the Reorganized Debtors' claim for a tax refund is barred by the applicable statue of limitations; -- the Reorganized Debtors' claims are subject to recoupment or set-off under Section 6402(a) of the Internal Revenue Code, the common law, and Section 553 of the Bankruptcy Code; -- Laidlaw Transportation, Inc., as common parent corporation of a consolidated group, is the sole agent for each member of the group, and each member of the consolidated group is severally liable for any tax debts; and -- the Reorganized Debtors' complaint may be barred, in whole or in part, under the doctrine of res judicata and collateral estoppel. The United States of America, on the IRS's behalf, therefore, asks the Court to: -- allow IRS's $8,022,036 Claim as filed; and -- dismiss the Debtors' suit for a refund of taxes. (Laidlaw Bankruptcy News, Issue No. 48; Bankruptcy Creditors' Service, Inc., 215/945-7000) LANTIS EYEWEAR: Wants to Employ RAS as Management Consultant ------------------------------------------------------------ Lantis Eyewear Corporation asks the U.S. Bankruptcy Court for the Southern District of New York for permission to hire RAS Management as management advisors and business consultants. The Debtor says it needs RAS Management's guidance in evaluating its operations, maximizing its realizable value and conforming to the financial requirements of a debtor-in-possession. RAS Management will: (1) review and evaluate Lantis' current operational turnaround initiatives, business plans and financial projections; (2) review and evaluate significant operational aspects of Lantis' business and identify key profit improvement opportunities; (3) review and evaluate any and all asset and operational valuation data and assist in preparing an independent valuation analysis; (4) assist Lantis in evaluating a strategic business plan designed to maximize value; (5) assist Lantis in the discharging its debtor-in-possession duties and functions, as requested by Lantis or its counsel; (6) consult with Lantis' management and counsel in connection with operation, financial, and other business matters relating to Lantis' ongoing activities; (7) interface with accountants and other financial consultants for committees and other creditors' groups; and (8) assist with other matters as Lantis' management or counsel may request from time to time. Paul E. Gricus, Lantis' Chief Financial Officer, discloses that RAS Management has been rendering consulting services to the Debtor since August 16, 2001. Since that time, RAS Management has become familiar with the Debtor and has garnered information necessary to deal effectively with many of its needs and problems that may arise in its Chapter 11 case. Lantis is in the process of retaining Houlihan Lokey Howard & Zukin as its investment banker. Mr. Gricus assures the Court that the services to be rendered by Houlihan Lokey will not be duplicative of the services to be rendered by RAS Management. Before the Petition Date, Lantis paid RAS Management $1,305,000 in the aggregate in the ordinary course of its business for prepetition services rendered. RAS Management holds a $20,000 retainer for application to postpetition services. RAS Management's hourly rates are not disclosed. Headquartered in New York, Lantis Eyewear Corporation -- http://lantiseyewear.com/-- is a leading designer, marketer and distributor of sunglasses, optical frames and related eyewear accessories throughout the United States. The Company filed for chapter 11 protection on May 25, 2004 (Bankr. S.D.N.Y. Case No. 04-13589). Jeffrey M. Sponder, Esq., at Riker, Danzig, Scherer, Hyland & Perretti, LLP, represents the Debtor. When the Company filed for protection from its creditors, it listed $39,052,000 in total assets and $132,072,000 in total debts. LOEWS CINEPLEX: S&P Assigns Corporate Credit Rating At B -------------------------------------------------------- Standard and Poor's Ratings Services assigned its 'B' corporate credit rating to Loews Cineplex Entertainment Corp. At the same time, a 'B' bank loan rating and a recovery rating of '3' were assigned to Loews' proposed $720 million of secured bank facilities, indicating expectations for a meaningful recovery of principal (50%-80%) in a default scenario. In addition, a 'CCC+' rating was assigned to the company's proposed $415 million of senior subordinated notes due 2014. On a pro forma basis, the New York, New York-based theater chain will have about $2 billion in debt. The outlook is positive. "The ratings on Loews reflect its exposure to the mature and competitive U.S. movie exhibition industry, high fixed costs, unpredictable film product quality, strong competition from both existing competitors and alternative entertainment sources, and its aggressive financial profile," said Standard & Poor's credit analyst Steve Wilkinson. These factors are only partly mitigated by the group's position as the third largest U.S. film exhibitor, improved market conditions in the U.S. in the past three years, benefits to Loews' asset quality from rejecting leases in bankruptcy and splitting off its Canadian circuit, a strong market position in the high margin Mexican market, and some limited earnings diversity provided by its Spanish and South Korean joint- venture film exhibition operations. Loews' U.S. operations--1,488 screens in 140 theatres--account for about 70% of the group's theater level cash flow, and primarily are focused in densely populated cities. Loews' strategic focus on large urban markets exposes it to intense competition for audiences and high fixed rental costs, which contribute to EBITDA margins below industry peers and more than offset the benefits of favorable consumer and advertiser demand. Loews' large market strategy also creates some earnings concentration, particularly in the greater New York metro area, where a large portion of the company's U.S. earnings is generated. Even so, the company's competitive position in the U.S. is somewhat protected by its good theater quality and its favorable position in key markets. Loews' Mexican operations, which account for about 20% of earnings, generate strong operating margins, supported by a concentrated market structure and relatively low operating costs, and significant flexibility under its theater lease agreements, where about 25% of leases are percentage rent only leases. MARINER HEALTH: Inks $1 Bil. Merger Pact with National Senior Care ------------------------------------------------------------------ Mariner Health Care, Inc. (OTCBB: MHCA) entered into a Merger Agreement with National Senior Care, Inc. Under the terms of the merger agreement Mariner shareholders will receive $30 in cash for each share of Mariner's Common Stock, representing a premium of 49% based on yesterday's closing price of $20.10. The transaction is valued at approximately $1.0 billion, including the assumption or satisfaction of Mariner's debt obligations of approximately $385 million. Mariner's Board of Directors unanimously approved the transaction following the receipt of a fairness opinion from J.P. Morgan Securities Inc. as to the consideration to be received by the Mariner stockholders. C. Christian Winkle, Chief Executive Officer of Mariner stated, "As a management team, we are pleased to be able to deliver this value to Mariner's stockholders. National Senior Care has recognized the value of the company that we have built and we look forward to working with them to complete the merger. Once the merger is complete, National Senior Care is committed to ensuring that we continue to best serve the needs of our patients and their families, as well as the employees who provide their care." The closing of the transaction is subject to various conditions contained in the merger agreement, including the approval by Mariner's stockholders and the receipt of financing. Additional conditions include regulatory, governmental and licensing approvals and other closing conditions. The transaction is anticipated to close during the fourth quarter of 2004. In accordance with the Merger Agreement, a $40 million irrevocable bank letter of credit has been obtained to secure the payment of the break-up fee payable to Mariner under certain circumstances. In the event that Mariner terminates the Merger Agreement under certain circumstances, it may be required to pay NSC a break-up fee of $20 million. Mariner has been advised that SMV Property Holdings, LLC and its affiliates, entities affiliated with Rubin Schron, have applied for a portion of the financing required in connection with this transaction, to Column Financial, an affiliate of Credit Suisse First Boston LLC. SMV and its affiliates intend to use the proceeds from that portion of the financing together with $200 million in equity committed by SMV's affiliates in connection with the completion of the transactions contemplated by the Merger Agreement. Additional debt and equity financing will be sought from banks and other sources. J.P. Morgan Securities, Inc. and Houlihan, Lokey, Howard & Zukin acted as financial advisors to the Board of Directors of Mariner. Powell Goldstein acted as counsel to Mariner and Wachtell, Lipton, Rosen & Katz acted as Special Counsel to the Board of Directors of Mariner. NSC has retained MetCap Securities, LLC to act as its financial advisor and Baker & McKenzie to act as its counsel. SMV and its affiliates have retained CSFB to act as their financial advisor and Jenkens & Gilchrist Parker Chapin to act as their counsel. About National Senior Care Affiliates of NSC, control more than 50 long-term health care facilities located throughout the country with facility concentrations in Texas, North Carolina and South Carolina and generally lease these facilities to unaffiliated, third party, licensed long-term care operators. NSC is an entity that has been formed for the purpose of completing the transactions contemplated by the Merger Agreement. About Mariner Health Care Mariner, headquartered in Atlanta, Georgia, is one of the largest long-term care operators in the United States. Mariner, through its subsidiaries and affiliates, operates 263 skilled nursing and assisted living facilities as well as eleven long-term acute care hospitals representing approximately 31,600 beds across the country. Additional company information is available at http://www.marinerhealth.com/ A full-text copy of the Agreement and Plan of Merger between Mariner and NSC is available for free at: http://www.sec.gov/Archives/edgar/data/882287/000095014404006774/g89855exv2w1.txt (Mariner Bankruptcy News, Issue No. 59; Bankruptcy Creditors' Service, Inc., 215/945-7000) MEDIA GROUP INC: Case Summary & 25 Largest Unsecured Creditors -------------------------------------------------------------- Lead Debtor: Media Group, Inc. 102-3 Hamilton Avenue Stamford, Connecticut 06902 Bankruptcy Case No.: 04-50845 Debtor affiliates filing separate chapter 11 petitions: Entity Case No. ------ -------- American Direct Marketing, Inc. 04-50846 International Media, Inc. 04-50847 Type of Business: The Debtor is a distributor and direct marketer of automotive additives and general merchandise. Chapter 11 Petition Date: July 9, 2004 Court: District of Connecticut (Bridgeport) Judge: Alan H.W. Shiff Debtor's Counsels: Douglas S. Skalka, Esq. Neubert Pepe and Monteith 195 Church Street 13th Floor New Haven, CT 06510 Tel: 203-821-2000 Total Assets Total Debts ------------ ----------- Media Group, Inc. $10,915,723 $14,743,552 American Direct Marketing, Inc. $3,216,642 $7,280,346 International Media, Inc. $5,159,038 $10,048 A. Media Group, Inc.'s 20 Largest Unsecured Creditors: Entity Nature Of Claim Claim Amount ------ --------------- ------------ HUPA International, Inc. Litigation/product $1,426,573 21717 Ferrero Parkway dispute Walnut, CA 91789 Walgreens Product returns $625,000 P.O. Box 4025 Denville, IL 61834 Crescent Marketing, Inc. Manufacturing/ $517,776 10285 Schaffstall Road Shipping North Collins, NY 14111 Dale Puziss, et al. Texas Class action $396,297 c/o Sandak Hennessey & Greco LLP 970 Summer St. Stamford, CT 06905 Phoenix International Advertising $330,000 Raceway 1801 W. Int'l Speedway Blvd. Daytona Beach, FL 32114 Shenzhen Universal Product $260,000 Industries Hubei Baofeng Bldg, Rm. 1103 1054 Bosoan Road South Shenzhen, China Reliance Asset Management Rent $258,040 422 Summer St. Stamford, CT 06901 Alexander H. Schwartz, Esq. Attorney Fees $235,042 Target Product return $155,000 Hall Dicker Kent Friedman Attorney Fees $134,631 Telamerica Media Advertising $125,000 Yellow Freight Shipping $123,000 Varnum, Riddering, Schmidt Attorney's Fees $95,000 Curtis Packaging Packaging $88,362 Cantor Colburn Attorney's Fees $75,000 Coast to Coast Fulfillment Services $63,722 Storeh Amini & Munves Attorney's Fees $59,807 Saint-Gobaia Calmar, Inc. Product $57,000 Menasha Packaging Co. Packaging $53,694 Dinsmore & Shohl Attorney's Fees $52,882 B. American Direct Marketing's 20 Largest Unsecured Creditors: Entity Nature Of Claim Claim Amount ------ --------------- ------------ Villandry LLC & Blue Ridge Lawsuit $2,000,000 Int'l c/o Lucio, Bronstein & Garbett 80 S.W. Eighth St., Ste 3100 Miami, FL 33130 Raymond Tuppatsch Lawsuit $600,000 American Industrial Services c/o Miller & Martin 1200 One Nashville Place 150 Fourth Ave. North Nashville, TN 37219 Crescent Marketing Trade $231,168 C. International Media, Inc.'s 20 Largest Unsecured Creditors: Entity Nature Of Claim Claim Amount ------ --------------- ------------ Villandry LLC & Blue Ridge Lawsuit $2,000,000 Int'l c/o Lucio, Bronstein & Garbett 80 S.W. Eighth St., Ste 3100 Miami, FL 33130 Raymond Tuppatsch Lawsuit $600,000 American Industrial Services c/o Miller & Martin 1200 One Nashville Place 150 Fourth Ave. North Nashville, TN 37219 METROMEDIA INT'L: Inks Pact to Sell Radio Unit to Communicorp ------------------------------------------------------------- Metromedia International Group, Inc. (currently traded as: OTCPK:MTRM - Common Stock and OTCPK:MTRMP - Preferred Stock), the owner of interests in various communications and media businesses in Russia and the Republic of Georgia, has reached an agreement to sell its wholly-owned radio business unit, Metromedia International Inc. to Communicorp Group Limited for an aggregate cash purchase price of $14.25 million. MII holds the Company's interests in seventeen of the Company's remaining eighteen radio businesses, which operate in Bulgaria, the Czech Republic, Estonia, Finland and Hungary. Communicorp will acquire the outstanding stock of MII for payments of $500 thousand (which was received Friday), $13.0375 million at closing and $712.5 thousand six (6) months after closing. The agreement with Communicorp anticipates a closing within 60 days subject to the satisfaction of certain closing conditions, including confirmatory due diligence by Communicorp. Such due diligence is related to the representations and warranties provided by the Company, including but not limited to, the financial statements of MII as presented by the Company, not having unrecorded liabilities in excess of $3.0 million. The agreement also provides for an adjustment to the cash purchase price, if the consolidated net assets of MII at closing differ by more than two percent (2%) from the projected amount the Company has provided to Communicorp. In a limited number of circumstances, including in the event that Communicorp identifies unrecorded liabilities in excess of $3.0 million prior to closing, Communicorp will have the option to terminate the agreement and receive repayment of the $500 thousand paid by it to the Company. The Company anticipates that the sale of MII will result in the recognition of a modest US GAAP book gain. However, the Company will likely recognize a US tax basis loss on the sale since the Company's tax basis is significantly higher than the projected net cash proceeds. Concerning the terms of the sale agreement, Ernie Pyle, Executive Vice President and Chief Financial Officer of the Company, commented, "Although this sale is subject to confirmatory due diligence by Communicorp, we do not presently expect any surprises which would result in termination of the agreement. We also do not anticipate any significant adjustment to the purchase price as a result of the true-up for net assets at closing." Mark Hauf, Chairman and Chief Executive Officer of the Company, also commented: "This sale of MII concludes the program of non- core asset sales we began early in 2003. I'm very pleased with the price our team negotiated for our remaining radio businesses and trust that Communicorp will be pleased with these additions to its radio portfolio. We have now essentially finished the fundamental restructuring of the Company's business operations. With the successful monetization of all former non-core business interests, the management team can now turn attention to the complex task of restructuring the Company's balance sheet." Paddy Halpenny, President and Chief Executive Officer of Communicorp, commented, "The MII radio businesses in Bulgaria, the Czech Republic, Estonia, Finland and Hungary present the Communicorp Group with exciting commercial opportunities in five established markets in Central and Eastern Europe. With the global economic upturn and considerably improved conditions within the advertising markets in each of these jurisdictions, these businesses are well positioned to prosper under the continuing stewardship of the group management team led by Christo Grozev - General Director, Catherine Tezcan - Finance Director and the individual country managing directors. With this strong management team under the strategic guidance and direction of the Communicorp Group, and, in particular, its Chairman and media and telecoms entrepreneur, Denis O'Brien, I am looking forward to growing these businesses significantly in the future." About Metromedia International Group Through its wholly owned subsidiaries, the Company owns communications and media businesses in Russia, Europe and the Republic of Georgia. These include mobile and fixed line telephony businesses, wireless and wired cable television networks and radio broadcast stations. The Company has focused its principal attentions on continued development of its core telephony businesses in Russia and the Republic of Georgia, while undertaking a program of gradual divestiture of its non-core media businesses. The Company's core telephony businesses include PeterStar, the leading competitive local exchange carrier in St. Petersburg, Russia, and Magticom, the leading mobile telephony operator in the Republic of Georgia. The Company's remaining non- core media businesses consist of 18 radio businesses operating in Finland, Hungary, Bulgaria, Estonia, and the Czech Republic and one cable television network in Lithuania. * * * As reported in the Troubled Company Reporter's June 24, 2004 edition, Metromedia International Group, Inc., filed with the Securities and Exchange Commission its 2004 First Quarter Form 10- Q. Simultaneously with the filing of the Current Quarterly Report with the SEC, the Company delivered a copy thereof to the Trustee of its 10 1/2 % Senior Discount Notes due 2007 and thereby cured a default condition within the specified cure period provided for under the Indenture governing the Senior Notes. As previously reported, the Trustee had advised the Company on May 18, 2004 that it must provide the Trustee with its Current Quarterly Report by July 16, 2004 or the Trustee would be forced to declare an Event of Default under the Indenture. Accordingly, the Company is currently in compliance with its SEC reporting requirements and the OTCBB trading eligibility requirements. MORGAN RV INC: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Morgan RV Inc. dba Strawberry RV 1905 South Frontage Road Plant City, Florida 33563 Bankruptcy Case No.: 04-13531 Type of Business: The Debtor is a motor vehicle dealer whose business includes selling recreational vehicles to end users from its place of business in Plant City, Florida. See http://www.strawberryrv.com/ Chapter 11 Petition Date: July 2, 2004 Court: Middle District of Florida (Tampa) Judge: Michael G. Williamson Debtor's Counsel: David W. Steen, Esq. David W. Steen, P.A. 602 South Boulevard Tampa, FL 33606-2630 Tel: 813-251-3000 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 ------ --------------- ------------ IRS Special Procedures $217,640 Florida Dept. of Revenue Florida State Sales $105,894 E-Trade Used Units - Trade-in $68,000 owed for loan of Kennedy Bank of the West Used Units - Trade-in $51,935 owed for loan of Troy Duncan ($41,819) and Trade-in owed for loan of lowery Florida Dept. of Revenue $46,140 Bank of America Used Unit - Trade-in $29,000 Owed for Sullivan Charter One Bank, NA Trade-in owed for $26,000 loan of Peterson Elizabeth Ramsaran Consignment unit $7,000 Starcraft $6,697 Mr. & Mrs. Louis Nutt Consignment unit $6,000 Amex $5,391 Coast Distribution $4,695 R-Vision $4,114 Unknown Consignment unit $3,000 Sharp Accting $2,320 FDN Communications $2,108 Stag-Parkway, Inc. $2,006 Media General Publishing $1,885 TECO (Tampa Electric) $1,408 Clear Channel $1,305 NATIONAL SCHOLARSHIP: Case Summary & Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Sero/National Scholarship Service & Fund for Negro Students, Inc. aka NSSFNS Veterans Program P.O. Box 11409 Atlanta, Georgia 30310 Bankruptcy Case No.: 04-95152 Type of Business: The Debtor is an organization that provides financial assistance for continuing education. Chapter 11 Petition Date: July 2, 2004 Court: Northern District of Georgia (Atlanta) Judge: Ray Mullins Debtor's Counsel: Robert L. Simmons, Esq. Simmons & Simmons 1037 R.D. Abernathy Boulevard, South West Atlanta, GA 30310 Tel: 404-755-2474 Estimated Assets: $1 Million to $10 Million Estimated Debts: $1 Million to $10 Million Debtor's 6 Largest Unsecured Creditors: Entity Claim Amount ------ ------------ Citizens Trust Bank $389,000 75 Piedmont Avenue Atlanta, GA 30303 Fannie Mae Foundation $235,000 City of Atlanta $148,000 Hartwood II Vesta Holdings $70,000 City of Atlanta Water Department $62,000 Georgia Department of Community Affairs $60,000 NEWAVE INC: Reports $740,000 of Gross Revenues in June 2004 ----------------------------------------------------------- NeWave, Inc. (OTC Bulletin Board: NWAV) a provider of membership- based online products and services through its subsidiary OnlineSupplier.com, booked a record $740,000 in gross revenue for the month of June. NeWave CEO Michael Hill stated, "I continue to be encouraged by the strength of our business. We believe NeWave is positioned to benefit from an ever expanding online economy and become a leading player in e-commerce. Our focus will continue to be on driving top line growth through increased membership from our diversity, quantity and quality of our product offering." He added, "Shortly we plan to begin the roll out of our national radio advertising campaign utilizing our national celebrity spokesman Bob Eubanks and we are extremely optimistic about the response to the campaign." About NeWave, Inc. NeWave, Inc. through its wholly-owned subsidiary Onlinesupplier.com offers a comprehensive line of products and services at wholesale prices through its online club membership. Additionally, NeWave's technology allows both large complex organizations and small stand-alone businesses to create, manage, and maintain effective website solutions for e-commerce. To find out more about NeWave (OTC Bulletin Board: NWAV), visit http://www.newave-inc.com/or http://www.onlinesupplier.com/ As reported in the Troubled Company Reporter's June 8, 2004 edition, Kabani & Company's report on the Company's consolidated financial statements for the fiscal years ended December 31, 2003 and December 31, 2002 included an explanatory paragraph wherein they expressed substantial doubt about NeWave's ability to continue as a going concern. NEW CENTURY: Capital Deficit Triggers Going Concern Doubt --------------------------------------------------------- As of March 31, 2004, New Century Companies Inc.'s balance sheet shows negative working capital of $3,075,942, an accumulated deficit of $6,254,547 and the company reports recurring losses from operations. These factors, among others, raise substantial doubt about the Company's ability to continue as a going concern. The Company intends to fund operations through increased sales and debt and equity financing arrangements which management believes may be insufficient to fund its capital expenditures, working capital and other cash requirements for the fiscal year ending December 31, 2004. Therefore, the Company will be required to seek additional funds to finance its long-term operations. The successful outcome of future activities cannot be determined at this time and there is no assurance that if achieved, the Company will have sufficient funds to execute its intended business plan or generate positive operating results. The Company is currently addressing its liquidity issue by the following actions: The Company continues its aggressive program for selling inventory that has been produced or is currently in production. The Company continues to implement plans to further reduce operating costs. The Company is continually seeking investment capital through the public markets including through its PPM. However, there is no guarantee that any of these strategies will enable the Company to meet its obligations for the foreseeable future. NEWMARKET TECH: Nevada Secretary of State Accepts Name Change ------------------------------------------------------------- NewMarket Technology Inc. (OTCBB:IPVO) received notification from the Secretary of State of Nevada that the name change to NewMarket Technology Inc. has been accepted. The Company will proceed immediately with submitting the approved name change to NASDAQ to affect a ticker symbol and CUSIP number change on the OTC Bulletin Board. The corporate name change is part of an overall communication plan to convey the Company's expanding business in various market sectors. NewMarket Technology Inc. sells emerging communication technology solutions and services. NewMarket's initial technology offering is a Voice over Internet Protocol (VoIP) solution. Over the last six months the Company has added emerging communication technology offerings specifically for the healthcare and homeland security industries. The Company generates additional revenue and exercises an economy of scale strategy by including a comprehensive emerging technology service and support offering as a critical component of the overall business plan. The Company has already won lucrative service contracts to support the emerging technology plans of high tech companies in addition to providing a cost effective support for their own emerging communication solutions. "The name change reflects the Company's notable advances toward the 2004 business plan objectives of rapidly building its revenue base along with a focus on profitability," said Philip Verges, CEO of NewMarket. "We are already approaching the annualized revenue run rate previously announced as the year end objective. Recent organic sales and the profitability of pending acquisitions are accelerating the Company's profitability schedule. We also expect the ticker symbol and CUSIP change to interfere with suspected short stock sellers that are not complying with regulatory timeframe requirements to purchase stock to fill short positions. We encourage shareholders to contact their brokers and request a confirmation that IPVoice certificates have been replaced with NewMarket certificates once the ticker symbol change has been affected with the OTCBB. Please do not hesitate to contact the Company for more information." About NewMarket Technology Inc. NewMarket (currently undergoing a corporate name change from IPVoice Communications Inc.) is a six-year-old company that has reported as a research and development concern for most of its history. In 2002, NewMarket launched a new business plan, which resulted in the Company posting six consecutive profitable quarters through 2003 and establishing an annualized $15 million in revenue. The Company is actively acquiring early-stage proprietary technology companies and financially distressed systems integration companies in specific global markets. In 2003, NewMarket acquired Infotel Technologies in Singapore and IP Global Voice, led by CEO Peter Geddis, a former Executive Vice President and Chief Operating Officer of Qwest Communications (NYSE:Q). The Company recently acquired Medical Office Software Inc., diversifying its communications technology offering into the healthcare industry. RKM IT Solutions of Caracas, Venezuela was also recently acquired as NewMarket's entry into the Latin American market. * * * Liquidity and Capital Resources In the Form 10-QSB for the quarterly period ended March 31, 2004, NewMarket reports: "At March 31, 2003, the Company had cash of $16,300 and a working capital deficit of $1,510,700 as compared to cash of $1,395,000 and working capital surplus of $252,000 at March 31, 2004. This improved working capital situation was due primarily to the implementation of the previously herein described new business model implemented in June 2002, which includes as part of the plan the acquisitions made over the last year. In addition we have been successful attracting investment capital to carry out this business model. "Since inception, the Company has financed operations primarily through equity security sales and convertible debt. The nature of the growth strategy of the Company will require further funding to be acquired either through equity or debt. Accordingly, if revenues are insufficient to meet needs, we will attempt to secure additional financing through traditional bank financing or a debt or equity offering; however, because the rapid growth and nature of the acquisitions of the Company and the potential of a future poor financial condition, we may be unsuccessful in obtaining such financing or the amount of the financing may be minimal and therefore inadequate to implement our continuing plan of operations. There can be no assurance that we will be able to obtain financing on satisfactory terms or at all, or raise funds through a debt or equity offering. In addition, if we only have nominal funds by which to conduct our operations, it will negatively impact our potential revenues." NRG ENERGY: Completes Sale of McClain Generating Station to OGE --------------------------------------------------------------- NRG Energy, Inc. (NYSE:NRG) announced its affiliate, NRG McClain LLC, has completed the sale of its 77 percent interest in the McClain Generating Station to Oklahoma Gas & Electric Company (OGE). The Oklahoma Municipal Power Authority will continue to own the remaining 23 percent interest in the facility. "Completing this transaction is another step in our program of divesting noncore assets that allows us to focus our energies on growing our core regional businesses," said David Crane, NRG President and Chief Executive Officer. "The sale removes $156 million in debt from NRG's balance sheet and continues our efforts towards reducing the leverage on NRG's balance sheet." NRG reached an agreement with OGE in August 2003 on the sale of NRG's interest in the 520-megawatt combined-cycle, natural gas- fired facility located in Newcastle, Oklahoma. The purchase was subject to approval from the Federal Energy Regulatory Commission which was granted July 2. WestLB AG's Global Specialized Finance Group represented the secured lenders in this transaction. NRG Energy, Inc. owns and operates a diverse portfolio of power- generating facilities, primarily in the United States. The Company's operations include baseload, intermediate, peaking, and cogeneration facilities, thermal energy production and energy resource recovery facilities. The company, along with its affiliates, filed for chapter 11 protection (Bankr. S.D.N.Y. Case No. 03-13024) on May 14, 2003. Debtors' counsel are James H.M. Sprayregen, P.C., Matthew A. Cantor, Esq., and Robbin L. Itkin, Esq. of Kirkland & Ellis. When the company filed for protection from its creditors, it listed total assets of $10,310,000,000 and total liabilities of $9,229,000,000. NRG ENERGY: Nelson Debtors Resolve CSFB and PCL Industrial Claims ----------------------------------------------------------------- Debtors LSP-Nelson Energy, LLC, and NRG Nelson Turbines, LLC, ask the Court to approve a settlement agreement, dated June 10, 2004, among the Nelson Entities, NRG Energy, Inc., PCL Industrial Construction, Inc., and Credit Suisse First Boston. CSFB is the administrative agent under a Credit Agreement dated May 8, 2001, by and among NRG Finance Company I, LLC, the financial institutions from time to time parties to the credit agreement as lenders, CSFB, and each of the other agents and arrangers listed in the Loan Documents. Prior to the Nelson Debtors' Petition Date, LSP-Nelson and National Energy Production Corporation entered into a Turnkey Engineering, Procurement and Construction Agreement, dated December 21, 2000. Samuel S. Kohn, Esq., at Kirkland & Ellis, in New York, relates that pursuant to the Nelson Agreement, NEPCO was to design, engineer, procure, construct, start-up and test the 1,100 megawatt gas-fired, combined cycle electric generating facility at 1311 Nelson Road in Nelson, Illinois. The Lenders' Claims To finance the Nelson Project, LSP-Nelson entered into a Project Owner Guaranty, dated June 8, 2001, with CSFB, on the Lenders' behalf. CSFB asserts that LSP-Nelson currently owes the Lenders not less than $676,297,839 under the Project Owner Guaranty. Furthermore, CSFB asserts that pursuant to certain security, mortgage and pledge agreements related to the Credit Agreement and Project Owner Guaranty, the Lenders have a valid security interest in the Nelson Assets and all the estate, right, title and interest of the Nelson Entities. On November 20, 2003, CSFB filed valid proofs of a secured claim against the Nelson Entities for not less than $676,297,839. PCL's Claims In early 2002, the Nelson Agreement was assigned to, and assumed by PCL, pursuant to the Assignment and Assumption of Turnkey EPC Contract and Release, dated February 28, 2002. The Nelson Agreement was amended and restated as between LSP-Nelson and PCL, dated as of February 28, 2002. Subsequently, PCL and LSP-Nelson entered into an Owner Services Agreement, signed on January 16, 2003 and dated effective as of December 13, 2002, whereby PCL was to perform certain services during the suspension of the work under the Amended Nelson Agreement. PCL asserts that CSFB and LSP-Nelson owe them $1,482,768 under the Owner Services Agreement. In addition, PCL and certain of its suppliers and subcontractors allege that they have mechanics' liens in an aggregate amount of $33,000,000, arising out of the Nelson Agreement and other additional work performed with respect to the Nelson Project. The Illinois Litigation On April 14, 2003, Phillips, Getschow Co., a subcontractor of PCL, commenced a lawsuit against PCL, certain of PCL's suppliers and subcontractors, LSP-Nelson, and CSFB, on the Lenders' behalf, in the Circuit Court of the Fifteenth Judicial Circuit in Lee County, Illinois. Phillips sought an adjudication of its mechanics' lien rights under Illinois law with respect to the Nelson Project. In May 2003, PCL filed a counterclaim and third party complaint against LSP-Nelson and CSFB in the Illinois Litigation, alleging certain causes of action including foreclosure on an alleged mechanics' lien, breach of contract and quantum meruit. In July 2003, PCL asked the Court to lift the automatic stay so it can continue the Illinois Litigation in order to adjudicate, but not enforce, the amount and priority of PCL's mechanics' lien claim relating to the Nelson Project. In October 2003, the Court lifted the automatic stay as to all parties in the Illinois Litigation to permit the Illinois Court to continue the litigation for the purpose of determining the amounts and priorities of liens and claims against the Nelson Entities and their property arising out of the Nelson Project. PCL and certain of its suppliers and subcontractors have filed valid proofs of secured claims in the Chapter 11 cases of the Nelson Entities. Mr. Kohn notes that the Nelson Entities have no equity in the Nelson Assets. The only outstanding issues with respect to the Nelson Assets are among parties who have asserted certain liens and claims against the Nelson Assets. Accordingly, the Debtors are acting as a fiduciary and are attempting to maximize the value of the Nelson Assets for their estates. The PCL Settlement Agreement During the past seven months, the Nelson Entities, NRG Energy, PCL and CSFB engaged in lengthy, complex and extensive negotiations. To this end, NRG and CSFB, on the Lenders' behalf, entered into a Term Sheet dated February 10, 2004, as amended, to ensure that NRG Energy is fully reimbursed for all of its costs and expenses associated with its preservation, maintenance, operation and sale and other disposition of the Nelson Project and the Nelson Assets. The Term Sheet grants NRG Energy the Nelson Superpriority Claim, with respect to the sale proceeds generated by the sale or other disposition of the Nelson Assets. On June 14, 2004, the Illinois Court determined certain amounts and priorities of liens and claims against the Nelson Entities and their property arising out of the Nelson Project, subject to certain provisions that require the New York Bankruptcy Court's approval. Ultimately, the Nelson Entities, NRG Energy, PCL and CSFB, on the Lenders' behalf, entered into a settlement agreement, with these salient terms: A. Compromise and Allowance of Claims (1) CSFB, on the Lenders' behalf, will have a valid, binding, enforceable and perfected lien on and security interest in the Nelson Assets in the amount of the Lenders' Claim; (2) The Lenders' Claim is an allowed secured claim in the Chapter 11 cases of the Nelson Entities; (3) PCL will have a valid mechanics' lien on the Nelson Assets for $13,750,000, including pre-judgment interest, costs, fees and charges of any other kind, like the cost of enforcement or legal fees plus post-judgment interest. The PCL Resolved Amount will be used to satisfy the Mechanics' lien claims on the Nelson Assets of PCL and PCL's subcontractors and materialmen, whose work on the property is by virtue of contracts with PCL or subcontracts in respect of contracts with PCL; (4) PCL will have an allowed secured claim in the Chapter 11 case of LSP-Nelson in the amount of the PCL Resolved Amount, together with interest, with distribution priority over the Lenders' Claim, but not over the payment the first $2,950,000 of the Nelson Superpriority Claim; and (5) The Nelson Superpriority Claim will be allowed in the Chapter 11 cases of the Nelson Entities, and will constitute expenses of administration under Sections 503(6)(1), 507(a) and 507(6) of the Bankruptcy Code against the Nelson Entities with priority in payment over any and all administrative expenses of the kinds specified or ordered pursuant to any provision of the Bankruptcy Code. The Allowed Nelson Superpriority Claim will at all times be senior to the rights of CSFB, PCL, the PCL Subcontractors, and any and all other entities asserting claims against the Nelson Entities. Any amounts of the Allowed Nelson Superpriority Claim which exceed $2,950,000 will not be senior to PCL's Rights. B. Disposition of Nelson Assets The Debtors will distribute $13,750,000 plus interest, or solely in the event proceeds from the Nelson Assets Sale are, at the date of any Distribution Order, insufficient to pay in full PCL's Allowed Claim, that lesser amount as the Court may order to an Escrow Agent for the benefit of PCL for disbursement to PCL. PCL agrees that upon receiving PCL Distribution in an aggregate amount equal to $13,750,000, plus interest, except with regards to the Owner Services Agreement Claim, PCL will be deemed to have relinquished any and all right, title or interest of any nature it may hold in: (a) any real or personal property related to, or acquired for use in, the Nelson Project; and (b) the proceeds from the Nelson Sale remaining after payment in full of the PCL Allowed Claim to the Escrow Agent for the benefit of PCL and to have assigned, without any recourse, representation, or warranty whatsoever, any and all of their right, title or interests in the Residual Property to CSFB. C. Indemnity PCL will indemnify, defend and hold harmless the Release Parties for any and all claims, causes of action, obligations, duties and liabilities related to the Nelson Entities, the Nelson Agreement or the Nelson Project. D. Releases PCL and its affiliates release the Release Patties from any and all claims, causes of action, obligations, duties and liabilities related to the Nelson Entities, the Nelson Agreement or the Nelson Project PCL agrees that any settlement with a PCL Subcontractor regarding Subcontractor Liens, including any settlement existing as of the Settlement Effective Date, will include a provision that the settling PCL Subcontractor: (a) stipulates to the validity and amount of the Lenders' Claim, including the validity and perfection of the Lenders' security interest in the Nelson Assets; and (b) releases any and all claims, causes of action, liens, obligations, duties and liabilities related to the Nelson Entities, the Nelson Agreement or the Nelson Project. E. Interest PCL, CSFB and Nelson Debtors agree that with regards to the Resolved Amount: (a) no interest will accrue for the period June 18 to 30, 2004; (b) interest will accrue at the rate of 6%, compounded annually, from July 1 through December 31, 2004; (c) interest will accrue at the rate of 8%, compounded annually, from January 1 through December 31, 2005; and (d) interest will accrue at the rate of 9%, compounded annually, thereafter. Mr. Kohn asserts that the PCL Settlement Agreement will avoid extensive, highly contested litigation among the Parties. The PCL Settlement Agreement aids in the preservation of the Nelson Debtors' financial resources, which will ultimately benefit all parties-in-interest. NRG Energy, Inc. owns and operates a diverse portfolio of power- generating facilities, primarily in the United States. Its operations include baseload, intermediate, peaking, and cogeneration facilities, thermal energy production and energy resource recovery facilities. The company, along with its affiliates, filed for chapter 11 protection (Bankr. S.D.N.Y. Case No. 03-13024) on May 14, 2003. Debtors' counsel are James H.M. Sprayregen, P.C., Matthew A. Cantor, Esq., and Robbin L. Itkin, Esq. of Kirkland & Ellis. When the company filed for protection from its creditors, it listed total assets of $10,310,000,000 and total liabilities of $9,229,000,000. (NRG Energy Bankruptcy News, Issue No. 30; Bankruptcy Creditors' Service, Inc., 215/945-7000) OMNI FACILITY: Wants to Retain Candlewood as Investment Bankers --------------------------------------------------------------- Omni Facility Services, Inc., and its debtor-affiliates ask the U.S. Bankruptcy Court for the Southern District of New York for permission to retain Candlewood Partners, LLC as their investment banker. Prior to the Petition Date, Candlewood and the Omni Facility Debtors entered into a Retention Agreement under which Candlewood agrees to: (i) familiarize itself, to the extent Candlewood deems appropriate and feasible, with the business, operations, properties, financial condition and prospects of the Debtors; (ii) develop and, at the Debtors' direction, execute a strategic plan to sell the Debtors' mechanical, janitorial and food plant sanitation businesses; (iii) assist the Debtors in preparing presentations, discussions and due diligence materials relating to such sales; (iv) assist the Debtors in the preparation of a confidential information package describing each of the businesses and in the preparation and negotiations of any confidentiality agreements to be entered into by third parties potentially interested in entering into a sale, which shall be subject to approval by the Debtors; (v) at the Debtors' request, prepare comprehensive valuation analyses on up to 2 businesses that are not included in the sales; (vi) at the Debtors' request, make presentations to the Debtors' senior management, the Boards of Directors of the Debtors and the Debtors' creditors and stockholders on the status of any negotiations or discussions regarding a sale; and (vii) provide such other financial advisory and investment banking services as are customary for similar transactions and as may be mutually agreed upon by the Debtors and Candlewood. Candlewood will be paid: a. a $30,000 Monthly Retainer Fee; plus b. Sales Fees: 1) Mechanical and Janitorial First Sale Fee equal to $450,000; 2) Food First Sale Fee equal to $50,000; 3) Aggregate Sale Fee equal to 10% of the aggregate Consideration in excess of $8,000,000; and c. if the Debtors request a valuation, the Debtors shall pay Candlewood a Valuation Fee equal to $10,000 for each valuation. Headquartered in South Plainfield, New Jersey, Omni Facility Services, Inc. -- http://www.omnifacility.com/-- provides architectural, janitorial, landscaping, and electrical services. The Company filed for chapter 11 protection on June 9, 2004 (Bankr. S.D.N.Y. Case No. 04-13972). Frank A. Oswald, Esq., at Togut, Segal & Segal LLP represents the Debtors in their restructuring efforts. When the Company filed for protection from their creditors, they listed $80,334,886 in total assets and $100,285,820 in total debts. OWENS CORNING: Senator Suggests Creation of $141B Asbestos Trust ---------------------------------------------------------------- Senator Tom Daschle (Democrat, South Dakota) has proposed the creation of a $141 billion trust fund, with $42 billion to be paid in the first three to five years to ensure solvency, in part in response to an earlier Republican proposal to budget $124 million to a fund allocated to asbestos litigation which drove companies like Grace, USG and Armstrong into bankruptcy. Senator Daschle made the proposal by letter addressed to Senate Majority Leader William Frist (Republican, Tennessee). Senator Frist confirmed that his office was in communication with Senator Daschle about an amount for the proposed fund. "We still think this legislation will fall short of the mark. We think the minimum that is needed is $149 billion," Peg Seminario, an occupational health official with the AFL-CIO, told Susan Cornwell at Reuters late last month. Businesses and insurers, Ms. Cornwell reports, have pushed for a lower $128 billion funding level. Headquartered in Toledo, Ohio, Owens Corning -- http://www.owenscorning.com/-- manufactures fiberglass insulation, roofing materials, vinyl windows and siding, patio doors, rain gutters and downspouts. The Company filed for chapter 11 protection on October 5, 2000 (Bankr. Del. Case. No. 00-03837). Mark S. Chehi, Esq., at Skadden, Arps, Slate, Meagher & Flom represents the Debtors in their restructuring efforts. On Jun 30, 2001, the Debtors listed $6,875,000,000 in assets and $8,281,000,000 in debts. (Owens Corning Bankruptcy News, Issue No. 79; Bankruptcy Creditors' Service, Inc., 215/945-7000) PACIFIC GAS: Parties Amend Board of Equalization Stipulation Terms ------------------------------------------------------------------ To recall, the U.S. Bankruptcy Court approved a stipulation between PG&E and the California State Board of Equalization resolving SBE's Claim No. 13024 relating to outstanding tax obligations for Sales and Use Tax, Hazardous Substances Tax, Underground Storage Tank Tax, and Natural Gas Surcharge Tax. The parties further agreed that the Sales and Use Tax portion of the Claim would be the amount finally determined to be due upon completion of: (a) the SBE's audit of PG&E's liability; and (b) any subsequent appeals before the SBE or litigation in a forum of competent jurisdiction that results in the final adjudication of the Sales and Use Tax portion of the Claim. PG&E and SBE have now fully resolved the Sales and Use Tax portion of the Claim. Both parties, therefore, amend the August 2002 Stipulation to reflect these modifications: (a) The Natural Gas Surcharge Tax portion of the Claim will be allowed for $18,052,279, rather than $18,082,279 as set forth in the August 2002 Stipulation. Based on PG&E's $18,052,279 payment to SBE with respect to the Natural Gas Surcharge Tax portion of the Claim pursuant to the Court's May 16, 2001 approval of PG&E's motion to honor its obligations for public purpose programs, the natural Gas Surcharge Tax portion of the Claim has been fully satisfied; (b) The Hazardous Substances Tax portion of the Claim, which was allowed for $108,265 pursuant to the August 2002 Stipulation, is comprised of $97,536 in principal amount and $10,729 in prepetition interest; (c) The amount owed by PG&E to SBE for the Sales and Use Tax portion of the Claim is $1,866,017, comprised of $1,646,781 in principal liability and $219,235 in prepetition interest; (d) The Sales and Use Tax Liability is subject to offset by credits and adjustments owed by the SBE to PG&E in the total amount of $1,259,223, comprised of $1,208,259 in principal liability and $50,964 in prepetition interest; (e) Accordingly, the Sales and Use Tax portion of the Claim will be allowed as a priority tax claim pursuant to Section 507(a)(8) of the Bankruptcy Code for $606,793, equal to the amount of the Sale and Use Tax Liability minus the Offset Amount. Postpetition interest will accrue on the Allowed Claim at the applicable statutory rate, and will be paid pursuant to the Court's authorization to payment of interests to holders of undisputed claims in certain classes, dated March 27, 2002, and pursuant to the Plan; and (f) The automatic stay is lifted to allow the SBE and PG&E to set off the Sales and Use Tax Liability against the $1,259,223 Offset Amount. The set-off of the Offset Amount against the Sales and Use Tax Liability will occur without further Court action or approval, and the SBE and PG&E will each treat the amounts authorized to be set off as payments to each other, and will enter the payments in their books and records. Headquartered in San Francisco, California, Pacific Gas and Electric Company -- http://www.pge.com/-- a wholly-owned subsidiary of PG&E Corporation (NYSE:PCG), is one of the largest combination natural gas and electric utilities in the United States. The Company filed for Chapter 11 protection on April 6, 2001 (Bankr. N.D. Calif. Case No. 01-30923). James L. Lopes, Esq., William J. Lafferty, Esq., and Jeffrey L. Schaffer, Esq., at Howard, Rice, Nemerovski, Canady, Falk & Rabkin represent the Debtors in their restructuring efforts. On June 30, 2001, the Company listed $23,216,000,000 in assets and $22,152,000,000 in debts. (Pacific Gas Bankruptcy News, Issue No. 79; Bankruptcy Creditors' Service, Inc., 215/945-7000) PARADIGM MEDICAL: Takes Steps to Reduce Costs and Expenses ---------------------------------------------------------- Historically, Paradigm Medical Industries, Inc. has not demonstrated the ability to generate sufficient cash flows from operations to satisfy its liabilities and sustain operations, and the Company has incurred significant losses. These factors raise substantial doubt about Paradigm's ability to continue as a going concern. The Company's continuation as a going concern is dependent on its ability to generate sufficient income and cash flow to meet its obligations on a timely basis and/or obtain additional financing as may be required. The Company is actively seeking options to obtain additional capital and financing. In addition, the Company has taken steps to reduce costs and increase operating efficiencies. Specifically, the Company has significantly reduced the use of consultants, which has resulted in a large decrease in expenses, and reduced the direct sales force to three representatives, which has resulted in less payroll, travel and other selling expenses. Although these cost savings have significantly reduced the Company's losses and ongoing cash flow needs, if the Company is unable to obtain equity or debt financing, it may be unable to continue development of its products and may be required to substantially curtail or cease operations. The Company is engaged in the design, development, manufacture and sale of high technology diagnostic and surgical eye care products. Given the "going concern" status of the Company, management has focused efforts on those products and activities that will, in its opinion, achieve the most resource efficient short-term cash flow. As seen in the results for the three months ended March 31, 2004, diagnostic products have been the major focus and the Photon(TM) and other extensive research and development projects have been put on hold pending future evaluation when the Company's financial position improves. The Company does not focus on a specific diagnostic product or products but, instead, on this entire diagnostic product group. Paradigm Medical will continue to seek funding to meet its working capital requirements through collaborative arrangements and strategic alliances, additional public offerings and private placements of its securities, and bank borrowings. The Company is uncertain whether or not the combination of existing working capital and benefits from sales of its products will be sufficient to assure continued operations through December 31, 2004. As of March 31, 2004, the Company had accounts payable of $686,000, a significant portion of which is over 90 days past due. The Company has contacted many of the vendors or companies that have significant amounts of payables past due in an effort to delay payment, renegotiate a reduced settlement payment, or establish a longer-term payment plan. While some companies have been willing to renegotiate the outstanding amounts, others have demanded payment in full. Under certain conditions, including but not limited to judgments rendered against the Company in a court of law, a group of creditors could force it into bankruptcy due to its inability to pay the liabilities arising out of such judgments at that time. In addition to the accounts payable noted above, the Company also has non-cancelable capital lease obligations and operating lease obligations that require the payment of approximately $187,000 in 2004, $172,000 in 2005, and $14,000 in 2006. Paradigm Medical Industries is engaged in the design, development, manufacture and sale of high technology diagnostic and surgical eye care products. PARK CITY: Anticipates Positive Results in Preliminary Q4 Review ---------------------------------------------------------------- Park City Group, Inc. (OTCBB:PKCY) announced that a significant portion of the fourth quarter revenues have been generated from existing customers, and specifically the Fresh Market Manager customers. The Company experienced a strong finish to the quarter and by achieving this additional licensing revenue from the existing customers, it means that the Company will likely meet its financial plan for the fourth quarter that ended June 30, 2004. "The major focus of our business is delivering good customer service and products that will deliver the results that are promised. Our belief is that our success is measured by the success of our customers. This belief is reinforced by the fact that this quarter's revenues (anticipated to be between $1.4 and $1.5 million) are composed primarily of additional licenses from several existing customers. Our customers have given us their approval by acquiring additional licenses," states Randy Fields, CEO of Park City Group. Mr. Fields adds, "Additionally, the Company has continued growth in its sales pipeline with named prospects, many of whom are well into the process and are nearing the contract negotiation stage. We believe this is due in large part to our efforts in improving Company and product visibility with press coverage of customers and articles we have written for trade publications." "Preliminarily, our fourth quarter results will show that the Company has continued to make significant progress on balance sheet improvement and major developments in this past quarter also aided our ability to meet our financial plan," continues Fields. "For example, by providing an option for PAYGo (the subscription service for our software and services on a monthly fee basis), we were able to expedite the addition of new customers to our existing customer list. This is another important building block to the sustained growth plans and increasing revenue opportunities for moving the Company forward and developing a sustained and consistent revenue stream from month to month. We are pleased with our progress and anticipate being able to keep this momentum going into our next fiscal year." About Park City Group Park City Group, Inc. -- whose March 31, 2004 balance sheet shows a stockholders' deficit of $5,965,339 -- develops and markets patented computer software that helps its retail customers to increase their sales while reducing their inventory and labor costs: the two largest, controllable expenses in the retail industry. The technology has its genesis in the operations of Mrs. Fields Cookies, co-founded by Randy Fields, CEO of Park City Group, Inc. Industry leading customers such as The Home Depot, Victoria's Secret, The Limited, Anheuser Busch Entertainment and Tesco Lotus benefit from our software. Feel free to contact us (Media Contact Randy Fields) at 800-772-4556 or info@parkcitygroup.com To find out more about Park City Group (OTCBB: PKCY, Berlin: WKN# 925919), visit http://www.parkcitygroup.com/ PARMALAT: Pennsylvania Milk Board Gets $3.5 Million Cash Bond ------------------------------------------------------------- Certain of the states in which the Parmalat U.S. Debtors operate require purchasers of raw milk products to post bonds or provide other security to guarantee their obligations to milk suppliers. To satisfy these licensing requirements, the Debtors posted bonds in New York, Pennsylvania, New Jersey, and Michigan aggregating $9,350,000. The Debtors are currently in negotiations to replace the bonds, which expired on July 1, 2004. The Pennsylvania Milk Board requires that bonds or other form of security be in place at the time the renewal application for the U.S. Debtors' license to operate in Pennsylvania is submitted. As a result of the Debtors' failure to submit the required renewal application due June 15, 2004, the Pennsylvania Milk Board advised the Debtors that absent the submission of replacement security by June 22, 2004, the Pennsylvania Milk Board will send out a letter to Pennsylvania milk suppliers informing them of the Debtors' failure to provide the required security. The Debtors believe that this action would have a detrimental effect on their business. The U.S. Debtors are in the process of purchasing a certificate of deposit for $3,545,000 from Citibank, N.A., which they intend to assign as security to the Pennsylvania Milk Board on an interim basis pending the replacement of the Pennsylvania milk bonds. The Final DIP Order currently precludes the U.S. Debtors from granting liens that are senior to the Prepetition Collateral or the Postpetition Collateral to any other parties. In this regard, the U.S. Debtors, General Electric Capital Corporation, Citibank and the Official Committee of Unsecured Creditors agree to amend the Final DIP Order. In a Court- approved Stipulation, the parties agree to authorize the Debtors to purchase and assign as security the Citibank certificate of deposit to the Pennsylvania Milk Board to guarantee the Debtors' obligations to Pennsylvania milk suppliers. The Debtors are also authorized to take all appropriate steps to provide the Pennsylvania Milk Board with a first priority lien on the certificate of deposit. In all other respects, the Final DIP Order remains in full force and effect. * * * Judge Drain approves the stipulation amending the termination provisions under the DIP Financing Agreement and the Final DIP Order. Headquartered in Wallington, New Jersey, Parmalat USA Corporation -- http://www.parmalatusa.com/-- generates more than 7 billion euros in annual revenue. The Parmalat Group's 40-some brand product line includes milk, yogurt, cheese, butter, cakes and cookies, breads, pizza, snack foods and vegetable sauces, soups and juices and employs over 36,000 workers in 139 plants located in 31 countries on six continents. The Company filed for chapter 11 protection on February 24, 2004 (Bankr. S.D.N.Y. Case No. 04- 11139). Gary Holtzer, Esq., and Marcia L. Goldstein, Esq., at Weil Gotshal & Manges LLP represent the Debtors in their restructuring efforts. On June 30, 2003, the Debtors listed EUR2,001,818,912 in assets and EUR1,061,786,417 in debts. (Parmalat Bankruptcy News, Issue No. 24; Bankruptcy Creditors' Service, Inc., 215/945-7000) PEGASUS: Applies to Employ Drinker Biddle as Corporate Counsel -------------------------------------------------------------- Throughout the course of their Chapter 11 cases, the Pegasus Satellite Communications, Inc., and its debtor-affiliates will require a corporate and regulatory counsel with a national reputation and with extensive experience in all areas of corporate law. The Debtors believe that Drinker Biddle & Reath, LLP, is particularly well suited to act as their special corporate and regulatory counsel to represent them in connection with securities offerings, other forms of financing, acquisitions and divestitures that likely to be encountered in these Chapter 11 cases. Scot A. Blank, the Debtors' Senior Vice President for Legal and Corporate Affairs, and General Counsel, relates that the attorneys at Drinker Biddle have performed legal services for the Debtors, their non-debtor affiliates, and their predecessors since 1987. Through their representations, Drinker Biddle has become uniquely and thoroughly familiar with the Debtors and their business affairs. Accordingly, the Debtors sought and obtained the Court's authority to employ Drinker Biddle as their special corporate and regulatory counsel. Before the Petition Date, Drinker Biddle served as the Debtors' outside special corporate and regulatory counsel. The Debtors expect Drinker Biddle to continue to provide them with similar services in connection with corporate and regulatory matters, which do not constitute matters central to their reorganization. Drinker Biddle will work closely with the Debtors' general bankruptcy counsel. Mr. Blank states that the Debtors and their non-debtor parent, Pegasus Communications Corporation, paid about $1,600,000 in fees and expenses to Drinker Biddle for services as corporate and regulatory counsel over the past 12 months. Although the cost of professional fees on a going forward basis cannot be estimated with certainty, it is contemplated that Drinker Biddle's fees will not exceed $75,000 per year. Drinker Biddle will be paid by the Debtors for its legal services on an hourly basis in accordance with its ordinary and customary rates. Drinker's hourly billing rates are: Partners $305 - 550 Associates 165 - 385 Para-professionals 70 - 195 Warren T. Pratt, a member of Drinker Biddle, assures Judge Haines that the firm is a disinterested person as defined in Section 101(14) of the Bankruptcy Code and holds no adverse interest against the Debtors or any parties-in-interest. Headquartered in Bala Cynwyd, Pennsylvania, Pegasus Satellite Communications, Inc. -- http://www.pgtv.com/-- is a leading independent provider of direct broadcast satellite (DBS) television. The Company, along with its affiliates, filed for chapter 11 protection (Bankr. D. Me. Lead Case No. 04-20889) on June 2, 2004. Leonard M. Gulino, Esq., and Robert J. Keach, Esq., at Bernstein, Shur, Sawyer & Nelson, represent the Debtors in their restructuring efforts. When the Debtors filed for protection from their creditors, they listed $1,762,883,000 in assets and $1,878,195,000 in liabilities. (Pegasus Bankruptcy News, Issue No. 6; Bankruptcy Creditors' Service, Inc., 215/945-7000) PENTON MEDIA: Inks Separation Agreements with Former CEO & COO -------------------------------------------------------------- Penton Media, Inc. (OTCBB:PTON) has reached separation agreements with: * former CEO Thomas L. Kemp and * former president and chief operating officer Daniel J. Ramella. Both agreements become effective July 9, 2004. In addition, Ramella has resigned as a director of Penton's Board. Penton Media -- http://www.penton.com/-- is a diversified business-to-business media company that provides high-quality content and integrated marketing solutions to the following industries: aviation; design/engineering; electronics; food/retail; government/compliance; business technology/enterprise IT; leisure/hospitality; manufacturing; mechanical systems/construction; health/nutrition and natural and organic products; and supply chain. Founded in 1892, Penton produces market-focused magazines, trade shows, conferences and online media, and provides a broad range of custom media and direct marketing solutions for business-to-business customers worldwide. At March 31, 2004, Penton Media, Inc.'s balance sheet shows a stockholders' deficit of $154,902,000 compared to a deficit of $144,929,000 at December 31, 2003. PILLOWTEX CORP: Kohl's Wants Court to Dismiss Complaint ------------------------------------------------------- Jeffrey Meyers, Esq., at Ballard Spahr Andrews & Ingersoll, in Philadelphia, Pennsylvania, tells the Court that Kohl's Department Stores, Inc., placed orders with the Pillowtex Corporation Debtors for various types of textiles in 2003 and 2004. However, as previously agreed with the Debtors, Kohl's is entitled to promotional mark down, allowances as well as other rights to recoupment and set-off. Mr. Meyers relates that Kohl's does not owe the Debtors anything and is, instead, owed a substantial amount by the Debtors. Pursuant to its contract with the Debtors, Kohl's is entitled to volume rebates, broadcast allowances, bridal allowances, markdown assistance credits, late shipment fees, and other allowances totaling $5,661,556. Kohl's is also entitled to these credits: Back order freight, shipment penalties and overcharges related to 2002 invoices $204,991 Back order freight, shipment penalties and overcharges related to 2003 invoices 68,967 Defective and out of stock merchandise 103,543 The Debtors neither confirmed that they would issue the credits to Kohl's to be applied toward the unpaid invoices, nor refunded the amount of money that corresponds to the credits. Furthermore, the Debtors ceased supplying certain products to Kohl's. As a result, Kohl's needed to sell some merchandise below cost and suffered a loss of profit. The Debtors' actions constituted a breach of contract and Kohl's estimates the damage to be $11,243,778. Mr. Meyers asserts that, since some or all of the claims asserted by the Debtors in the Complaint and the claims asserted by Kohl's in its counterclaims may arise mutually from the same transactions, and during the same time period, the Debtors are subject to set-off or recoupment. Kohl's asks the Court to dismiss the Debtors' complaint. Kohl's also seeks damages from the Debtors to be determined at trial. Kohl's also asks the Court for permission to recoup or set off against any award that may be entered in the Debtors' favor. Kohl's demands a trial by jury on all issues that are triable. Debtors Talk Back Gilbert R. Saydah, Jr., Esq., at Morris Nichols Arsht & Tunnel, in Wilmington, Delaware, asserts that Kohl's Counterclaims fail to state a claim on which relief can be granted. The Debtors also believe that the Counterclaims are barred by statutes of limitations, and the doctrines of laches, unclean hands, waiver, ratification and estoppel. Kohl's also failed to mitigate damages. Headquartered in Dallas, Texas, Pillowtex Corporation -- http://www.pillowtex.com/-- sells top-of-the-bed products to virtually every major retailer in the U.S. and Canada. The Company filed for Chapter 11 protection on November 14, 2000 (Bankr. Del. Case No. 00-4211). David G. Heiman, Esq., at Jones, Day, Reavis & Poque represents the Debtors in their restructuring efforts. On July 30, 2003, the Company listed $548,003,000 in assets and $475,859,000 in debts. (Pillowtex Bankruptcy News, Issue No. 66; Bankruptcy Creditors' Service, Inc., 215/945-7000) PLYMOUTH COMMONS REALTY: Voluntary Chapter 11 Case Summary ---------------------------------------------------------- Debtor: Plymouth Commons Realty Corporation P.O. Box 314 Plymouth, Connecticut 06782 Bankruptcy Case No.: 04-33133 Chapter 11 Petition Date: July 2, 2004 Court: District of Connecticut (New Haven) Judge: Lorraine Murphy Weil Debtor's Counsel: Christopher C. Noble, Esq. Noble & Associates, LLC 1493 Stanley Street New Britain, CT 06053-2920 Tel: 860-225-1731 Total Assets: $3,101,010 Total Debts: $2,922,422 The Debtor did not file a list of its 20-largest creditors. POLO BUILDERS: Look for Schedules & Statements by July 29 --------------------------------------------------------- Polo Builders, Inc., and its debtor-affiliates ask the U.S. Bankruptcy Court for the Northern District of Illinois, Eastern Division, for more time to prepare and file their schedules of assets and liabilities, statements of financial affairs and lists of executory contracts and unexpired leases required under 11 U.S.C. Sec. 521(1). The Polo Builders Debtors tell the Court that their financial affairs are complex and intertwined in several ways. They have very limited personnel and resources available to assist in sorting out their affairs and report the Schedules accurately and completely. The Debtors submit that they need until July 29, 2004 to file their Schedules of Assets and Liabilities and Statement of Financial Affairs. Headquartered in Villa Park, Illinois, Polo Builders, Inc., filed for chapter 11 protection on June 23, 2004 (Bankr. N.D. Ill. Case No. 04-23758). Steven B. Towbin, Esq., at Shaw Gussis Fishman Glantz Wolfson & Towbin LLC 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. PORTLAND HOUSING: S&P Lowers Series 1997A Bonds Rating To BB+ ------------------------------------------------------------- Standard & Poor's Ratings Services lowered its rating to 'BB+' from 'BBB' on Portland Housing Authority, Oregon's housing revenue senior-lien bonds, series 1997A, issued for the Civic Apartments project. The outlook is negative. The rating action was based on the authority's potential long-term deteriorating fiscal and operating performance. "The unaudited financial and operating results for Civic Apartments, based on the year ended March 31, 2004, indicate that the property continues to underperform," Standard & Poor's credit analyst Debra Boyd said. "Civic Apartments must achieve both occupancy and income to maintain the property and to service debt." Portland Housing Authority has identified two possible actions to take over the medium term in response to its fiscal and operational challenges. It has created a redevelopment plan that would infuse more than $21.5 million into the project. The redevelopment project would include a complete renovation of the existing units, a new parking structure, and construction of retail space at ground level. The authority indicated that it ceased leasing efforts on the property in April 2004 in anticipation of these efforts, which has contributed to the property's high vacancy rates. If financing for the redevelopment plan cannot be secured, the authority indicated it will sell the property. The bonds are secured by a first mortgage lien on the Civic Apartments, an older property with 138 units. The Portland Housing Authority has owned the property since 1997. The property is run by Income Property Management, which has been associated with the property since 2001. RELIANCE GROUP: PBGC Says RFS' Disclosure Statement is Inadequate ----------------------------------------------------------------- The Pension Benefit Guaranty Corporation says that the Disclosure Statement proposed by Reliance Financial Services Corporation fails to provide adequate information about the classification of certain claims, third party release provisions and the "opt-out" requirement. The PBGC filed administrative priority and general unsecured claims against: (a) The Reliance Insurance Company Employee Retirement Plan for; (1) $124,200,000 in Unfunded Benefit Liabilities; (2) $27,618,083 in Minimum Funding Contributions; and (3) $292,126 in unpaid insurance premiums; and (b) The Reliance Group Holdings, Inc. Pension Plan for: (1) $18,500,000 in Unfunded Benefit Liabilities; (2) an unliquidated amount for Minimum Funding Contributions; and (3) an unliquidated amount for unpaid insurance premiums. Improper Classification of Bank Claims James J. Keightley, General Counsel at the PBGC in Washington, D.C., tells the Court that the Disclosure Statement fails to provide adequate information on the classification and treatment of Bank Claims. The Bank Claims are secured by RIC Common Stock. The Bank Committee, the proponent of the Disclosure Statement and Plan, asserts that based on the pledge of the RIC Common Stock and its proceeds under the Bank Credit Agreement, the Bank Claims are entitled to cash dividends from RIC and the Net Operating Losses. However, since the RIC Common Stock may be worthless and the Bank Claims are undersecured, these Claims should be classified as general unsecured claims, Mr. Keightley argues. Furthermore, the Disclosure Statement implies that the Section 847 tax refunds provide collateral securing the Bank Claims. The Section 847 tax refunds and distributions are the product of a tax sharing agreement that resolved contractual disputes among Reliance Financial Services Corporation, RGH and M. Diane Koken, the Insurance Commissioner of the Commonwealth of Pennsylvania, in her capacity as Liquidator of RIC. The tax refunds are not the result of payment of a dividend by RIC. Therefore, the Bank Committee is not entitled to the funds as the Plan contemplates. Mr. Keightley reminds the Court that Section 502(a) of the Bankruptcy Code provides that a claim is allowed unless a party- in-interest objects. By allowing the Bank Claims, the Plan takes away a party's right to object to their classification, amount and treatment. The Disclosure Statement fails to inform creditors of the loss of this valuable right. Injunctions and Releases According to the Disclosure Statement, each Holder of a Claim is deemed to have waived, released and discharged from liability, RFSC and a broad range of third parties. The broad release provisions could adversely impact the PBGC's pursuit of its joint and several claims related to the Pension Plans. The broad release could also adversely impact myriad other ERISA claims, including claims for breach of fiduciary based on the administration of the Pension Plans. Opt-out Provision The Disclosure Statement does not adequately explain which claims must be assigned to receive a distribution from the RFSC Liquidation Proceeds. The Disclosure Statement indicates that, to receive distribution from the RFSC Liquidation Proceeds, a creditor must assign its Litigation Claim to RGH. The Plan vaguely and broadly defines Litigation Claim. Furthermore, the Plan is unclear whether a creditor who does not have a claim can still participate in the distribution. As a result, creditors lack adequate information to make an informed decision whether or not they should opt out of distribution and if they will be entitled to distribution regardless of assignment. Headquartered in New York, New York, Reliance Group Holdings, Inc. -- http://www.rgh.com/-- is a holding company that owns 100% of Reliance Financial Services Corporation. Reliance Financial, in turn, owns 100% of Reliance Reliance Insurance Company. The Company filed for chapter 11 protection on June 12, 2001 (Bankr. S.D.N.Y. Case No. 01-13403). When the Company filed for protection from their creditors, they listed $12,598,054,000 in assets and $12,877,472,000 in debts. (Reliance Bankruptcy News, Issue No. 56; Bankruptcy Creditors' Service, Inc., 215/945-7000) RESIDENTIAL ACCREDIT: Fitch Affirm Classes B-1 & B-2 Low-B Ratings ------------------------------------------------------------------ Fitch Ratings has taken action on the following Residential Accredit Loan mortgage-pass through certificates: Residential Accredit Loans, Inc. Mortgage Asset Backed Pass- Through Certificates, Series 1997-QS1 --Classes A, R affirmed at 'AAA'; --Class M-1 affirmed at 'AAA'; --Class M-2 affirmed at 'AAA'; --Class M-3 affirmed at 'AAA'; --Class B-1 upgraded to 'AA-' from 'A+'; --Class B-2 upgraded at 'BBB' from 'BB'. Residential Accredit Loans, Inc. Mortgage Asset Backed Pass- Through Certificates, Series 2001-QS18 --Classes A, R affirmed at 'AAA'; --Class M-1 affirmed at 'AA'; --Class M-2 affirmed at 'A'; --Class M-3 affirmed at 'BBB'; --Class B-1 affirmed at 'BB'; --Class B-2 affirmed at 'B'. The upgrades are being taken as a result of low delinquencies and losses, as well as increased credit support levels. The affirmations are due to credit enhancement levels consistent with future loss expectations. REVLON INC: Strengthens Balance Sheet With New $960M Bank Facility ------------------------------------------------------------------ Revlon, Inc. (NYSE: REV) and its wholly-owned subsidiary, Revlon Consumer Products Corporation, together announced the successful consummation of a new $960 million credit facility from Citicorp USA, Inc. and Citigroup Global Markets Inc. and a syndicate of lenders on terms substantially similar to those previously announced. The Company indicated that the new credit facility and related refinancing transactions, which extend the maturity of much of the Company's debt that would have otherwise matured in 2005, further strengthen its balance sheet and represent another important step to creating long-term value. The Company also announced the successful tender offer for its 12% Senior Secured Notes due 2005, with approximately 82% of the total outstanding principal amount of the 12% Notes, representing approximately $298 million aggregate principal amount of the 12% Notes, validly tendered through 5:00 p.m. EDT on July 8, 2004. The Company indicated that amounts borrowed under the new term loan were used to pay in full RCPC's existing bank credit agreement in the amount of approximately $292 million and to repurchase approximately $298 million aggregate principal amount of the 12% Notes in the initial settlement of the tender offer. An additional approximate $74 million of the proceeds were deposited into a collateral account that will be used to repurchase the remaining 12% Notes that are tendered prior to the July 21, 2004 expiration of the tender offer and, if necessary, to redeem any 12% Notes remaining outstanding after such expiration. RCPC also used approximately $95 million of the proceeds to cover tender costs, accrued interest and transactional fees and expenses, including fees and expenses for the Company's successful debt-for- equity exchanges consummated in March 2004. RCPC indicated that the new credit facility is comprised of an $800 million term loan, which was drawn at the closing, and a $160 million asset-based multi-currency revolving credit facility, which was not drawn at the closing. The term loan, which matures in six years, bears interest at a rate per annum equal to, at RCPC's option, the alternate base rate plus 5.00% or LIBOR plus 6.00%. The revolving credit facility, which has a five-year term, bears interest at a rate per annum equal to, at RCPC's option, the alternate base rate plus 1.50% or LIBOR plus 2.50%. The obligations under the new credit facility are guaranteed by Revlon, Inc. and RCPC's domestic subsidiaries and are secured by the stock of RCPC and substantially all of the assets of RCPC and its domestic subsidiaries. The Company indicated that, upon purchasing the 12% Notes, RCPC's previously-announced supplemental indenture became operative. Accordingly, substantially all of the restrictive covenants contained in the indenture governing the 12% Notes have been eliminated and the guarantees of RCPC's obligations, and the collateral securing the obligations of RCPC and the guarantors under the indenture, have been released. As previously announced, the tender offer will expire at 5:00 p.m. EDT on July 21, 2004, unless extended. RCPC currently expects to have a final settlement promptly thereafter for any 12% Notes tendered on or after the July 9, 2004 initial settlement date. The detailed terms and conditions of the tender offer are contained in the Offer to Purchase for Cash and Consent Solicitation Statement dated June 22, 2004 relating to the 12% Notes. Holders of the notes can obtain copies of the Offer Documents and related materials from D.F. King & Co., Inc., the Information Agent, at (800) 949-2583 (toll free) or (212) 269-5550 (collect). Citigroup Global Markets Inc. is acting as Dealer Manager. Questions regarding the solicitation can be addressed to Citigroup at (800) 558-3745 (toll free) or (212) 723-6106 (collect). None of Revlon, RCPC, Citigroup or the Information Agent makes any recommendations as to whether or not holders should tender their notes pursuant to the tender offer, and no one has been authorized by any of them to make such recommendation. Holders must make their own decisions as to whether to tender notes, and, if so, the principal amount of notes to tender. About Revlon Revlon is a worldwide cosmetics, fragrance, and personal care products company. The Company's vision is to deliver the promise of beauty through creating and developing the most consumer preferred brands. Websites featuring current product and promotional information can be reached at http://www.revlon.com and http://www.almay.comCorporate investor relations information can be accessed at http://www.revloninc.com At March 31, 2004, Revlon Inc.'s consolidated balance sheet shows a stockholders' deficit of $956.4 million compared to a deficit of $1.72 billion at December 31, 2003. ROANOKE TECH: Can Now Issue 100 Million Class A Common Shares ------------------------------------------------------------- Roanoke Technology Corp. (OTCBB:RNKE) is pleased to report that the filing with the SEC for the amendments to its Articles of Incorporation required to allow for the creation of 100 million Class A common shares has been approved. These 100 million Class A common shares have the same par value of $0.0001 but have voting rights of one Class A share to ten common shares. Roanoke Tech C.E.O. Mr. David Smith commented, "As previously stated, this capital restructuring will allow us to retire up to 500 million common shares and return them to Treasury. Now that the SEC's approval has been received, the schedule for the retirement of these shares will be worked out for prompt implementation." * * * As reported in the Troubled Company Reporter's May 3, 2004 edition, Roanoke Technology Corporation has suffered losses from operations and may require additional capital to continue as a going concern as the Company develops its new markets. Management believes the Company will continue as a going concern in its current market and is actively marketing its services which would enable the Company to meet its obligations and provide additional funds for continued new service development. In addition, management is currently negotiating several additional contracts for its services. Management is also embarking on other strategic initiatives to expand its business opportunities. However, there can be no assurance these activities will be successful. There is also uncertainty with regard to managements projected revenue being in excess of its operating expenditures for the fiscal year ending October 31, 2004. Items of uncertainty include the Company's liabilities with regard to its payroll tax liability in excess of $700,000 and its Small Business Administration loan with a principal balance of $270,807 plus accrued interest. The Company has been in default of these liabilities and has had negotiations regarding resolution of these matters. The outcome of these negotiations was uncertain as of October 31, 2003. If the Company is not successful in these negotiations or payment, there is substantial doubt as to the ability of the Company to continue as a going concern. On December 25, 2003 the Company negotiated an installment agreement with the Internal Revenue Service with regard to its payroll tax liability. The agreement calls for payments of $5,000 per month for 48 months with a balloon payment for the balance owed at the end of that period. The Company's President, Dave Smith, signed for personal liability of the Trust Fund portion in the amount of $321,840 plus penalties and interest should the Company default on these payments. Should the Company default on these payments and any other current tax compliance, the Company's property can be taken to satisfy the liability. During the year ended October 31, 2003, the Company often remained current with its monthly payment for its Small Business Administration loan. Of the $270,807 balance owed, the Company has a past due balance of $131,150. The lender holds the Company's furniture and equipment as collateral for this loan. SABRELINER CORP: S&P Downgrades Corporate Credit Ratings To B- -------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on Sabreliner Corp, including the corporate credit rating to 'B-' from 'B', and removed the ratings from CreditWatch, where they were placed with negative implications on March 18, 2003. The outlook is stable. Sabreliner has approximately $90 million of rated debt outstanding. "The downgrade reflects a weak financial profile, stemming from a heavy debt burden and low profitability, constrained liquidity, and a reduced scope of operations following divestitures," said Standard & Poor's credit analyst Christopher DeNicolo. In 2003, Sabreliner sold its turbine engine repair business and a fixed based operator in St. Louis, using the proceeds to reduce debt. The divestitures reduced the company's size and diversity. The business is now divided into three segments: flight sustainment, aircraft enhancements, and government services. The main driver of growth for the company is expected to be the completion of high-end business jets. However, this will be offset somewhat by the loss of a significant aircraft maintenance and logistics contract with the U.S. government. Although Sabreliner has reduced debt significantly in the past two years, credit protection measures are still quite weak. Somewhat better earnings in fiscal 2005 are likely to result in a modest improvement in financial ratios, but further debt reduction is unlikely in the near term. The company does not publicly release financial information. Lower debt levels and the prospects for strengthening in the business jet market are expected to enable Sabreliner to maintain a credit profile consistent with current ratings. SIGHT RESOURCE: First Creditors Meeting Slated for July 30 ---------------------------------------------------------- The United States Trustee will convene a meeting of Sight Resource Corporation's creditors at 1:30 p.m., on July 30, 2004, in Suite 2050 at the Office of the U.S. Trustee, 36 East Seventh Street, Cincinnati, Ohio 45202. 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 Cincinnati, Ohio, Sight Resource Corporation -- http://www.sightresource.com/-- manufactures, distributes and sells to the general public eyewear and related products and services through retail eye care centers operated by its wholly owned subsidiaries. The Company filed for chapter 11 protection on June 24, 2004 (Bankr. S.D. Ohio Case No. 04-14987). Jennifer L. Maffett, Esq., and Louis F Solimine, Esq., at Thompson Hine LLP, represent the Debtors in their restructuring efforts. When the Company filed for protection from their creditors, they listed $5,400,000 in total assets and $12,500,000 in total debts. SOLUTIA: Amends $500 Million DIP Financing Facility One More Time ----------------------------------------------------------------- Amendment No. 1 to Financing Agreement and Waiver, dated as of March 1, 2004. The Amendment provides the Solutia, Inc. Debtors with additional time to comply with certain post-closing covenants and to provide for the addition of a new entity as the "Co- Documentation Agent" under the DIP Agreement. No fees were paid by the Debtors in connection with the First Amendment. The Debtors have made significant progress in stabilizing their business operations and working with parties-in-interest in the Chapter 11 cases to build a basis for a reorganization plan. Central to that process has been the development of a new business plan, which sets forth the key operational and restructuring initiatives that the Debtors will pursue to allow them to maximize the value of their businesses and emerge from Chapter 11 as stronger companies. The business plan contemplates the restructuring of certain of the Debtors' contractual and lease obligations and the streamlining of business operations through the wind-down or sale of certain of the Debtors' businesses. In the course of developing the business plan, the Debtors determined that certain of the contemplated changes and initiatives either would be prohibited by covenants or other restrictions in the DIP Agreement. Accordingly, the Debtors entered into good faith, arm's-length negotiations with the DIP Agent and the DIP Lenders to amend the terms of the DIP Agreement to facilitate the implementation of the Debtors' reorganization strategy and to provide the Debtors with an increased level of flexibility in managing their operations while in Chapter 11. M. Natasha Labovitz, Esq., at Gibson, Dunn & Crutcher, LLP, in New York, relates that the negotiations have been fruitful. The Debtors have worked with the DIP Agent to reach an agreement on a second amendment to the DIP Agreement, which have been presented to the individual DIP Lenders for review and approval. The Second Amendment Pursuant to the Second Amendment, the Debtors stand to gain important flexibility to make necessary changes in their operations and agreements related to those operations in a way that will allow the Debtors to achieve significant cost savings and liquidity improvements, along with streamlining their operations and simplifying certain reporting and other compliance requirements. The proposed Second Amendment will benefit the Debtors in these key areas: A. Asset Sales and Restructuring The Second Amendment will facilitate asset sales and business restructuring activities by permitting: (1) numerous asset dispositions and other general categories of asset transactions, including: (a) the sale of specified business lines and other enumerated assets of the Solutia Group; (b) sales or leases and subleases of specified parcels of real estate owned or leased by the Solutia Group that are not used in its core business operations; (c) sales of certain assets of minor business lines that are wound down, like the Chlorobenzene business; and (d) certain other sales pursuant to other motions under Section 363 of the Bankruptcy Court or the Court- approved non-core asset sales procedures; (2) certain asset sale transactions involving non-cash consideration, like ongoing earn-out payments or land swaps; and (3) certain de minimis charitable donations by non-Debtor Subsidiaries and donations or below-market sales of certain parcels of real estate by the Debtors where appropriate. B. Mandatory Prepayments/Commitment Reductions The Second Amendment will modify existing loan prepayment requirements by permitting the Debtors to retain proceeds of certain asset dispositions and extraordinary receipts that would otherwise be required to be used to permanently pay down loans under the DIP Agreement. The Second Amendment will: (1) increase the amount of proceeds of all Dispositions and Extraordinary Receipts not generally subject to mandatory prepayment requirements from $2,500,000 to $7,500,000, and clarify and expand the types of Extraordinary Receipts that benefit from this carve- out; (2) permit the retention of the first $5,000,000 of proceeds of Specified Property Dispositions and limit the prepayment obligation for proceeds of the Specified Property Dispositions to 50% of the next $10,000,000 of sale proceeds; and (3) clarify the allocation of proceeds of asset sales that involve assets subject to liens of both the DIP Lenders and the holders of the Eurobonds issued by Solutia's Belgian subsidiary, Solutia Europe, SA/NV. C. Contract and Lease Restructurings The Second Amendment will contain provisions that increase the Debtors' flexibility to replace, modify or reap the benefits of certain of their existing contracts and leases so as to meet cost reduction and other goals set forth in the business plan. The Second Amendment will: (1) permit the entry into certain sale-leaseback transactions; (2) permit the Debtors to enter into stipulations regarding lifting the stay for certain fully secured obligations and to make related prepetition payments; (3) allow the Debtors greater flexibility in restructuring prepetition contracts and leases through its assumption or replacement, including in the areas of: (a) granting ordinary course indemnities in connection with the execution of new contracts and leases; (b) entering into capital leases and operating leases; and (c) permitting amendments to material contracts that are not materially adverse to the DIP Lenders; (4) permit the Debtors to continue implementing a prepetition restructuring agreement with respect to the deferral of certain payments from Astaris, LLC; and (5) permit the Debtors to pay up to $5,000,000 per year, and pay reasonable related fees and expenses, in respect of certain prepetition litigation settlement agreements, which may preserve the Debtors' rights to realize benefits under those agreements. D. Operational Flexibility Provisions of the Second Amendment will enhance the Debtors' ability to take other operational steps to improve their business operations consistent with the business plan by: (1) allowing the Debtors and their Subsidiaries to increase short-term liquidity and mitigate collection risks through limited sales of accounts receivable; (2) facilitating the marketing of new products or the establishment of new customer relationships by permitting certain sales of inventory subject to ordinary course return or approval rights; (3) permitting the Debtors to make general payments in respect of de minimis prepetition claims up to a $1,500,000 limit and subject to the Court's approval; (4) clarifying the Debtors' right to engage in the wind- down of minor business lines, and permitting the liquidation or merger of certain "Significant Subsidiaries"; (5) permitting certain de minimis acquisitions of all or substantially all of the assets of other entities and certain other equity investments and capital contributions; (6) granting the Debtors greater flexibility in structuring voluntary environmental remediation activities on real properties owned by the Debtors by permitting implementation of certain institutional controls like land-use and natural resource-use restrictions, access restrictions and other restrictive covenants that "run" with the land; and (7) streamlining the Debtors' reporting requirements by reducing the number of reports which must be provided in respect of minor environmental issues and inventory held on consignment, and clarifying the types of notices which must be provided to the DIP Lenders and the means by which those notices are delivered. Ms. Labovitz clarifies that the Second Amendment will not modify the financial covenants set forth in the DIP Amendment. The terms and conditions of the proposed Second Amendment also contemplate that the Debtors will pay an amendment fee of 12.5 basis points, or $656,250, to the DIP Lenders and a documentation fee of $250,000 to the DIP Agent. The Debtors, the DIP Lenders and the DIP Agent have negotiated these fees at arm's length and in good faith. Based on those negotiations and the benefits of the Second Amendment, the Debtors believe that payment of the Amendment-Related Fees is prudent and will be more than recouped in the context of the cost savings and liquidity enhancements that the Second Amendment will permit. Accordingly, the Debtors seek the Court's authority to: -- amend the DIP Agreement; and -- pay the Amendment-Related Fees in connection with the amendment. The Debtors have evaluated their financing and operational needs in light of their intended reorganization strategy. The Debtors decided that it is more prudent from a business perspective to enter into a single comprehensive amendment to the DIP Agreement to facilitate the implementation of that business strategy, rather than incurring the costs and expenses associated with seeking individual waivers and consents for the numerous actions they may desire to take during the course of the Chapter 11 cases. The Second Amendment will afford the Debtors significantly improved ability to refine and implement their restructuring strategy and should provide them with increased flexibility in managing their day-to-day operations and with comfort that those day-to-day operations will not result in the inadvertent breach of onerous or ambiguous loan provisions. Headquartered in St. Louis, Missouri, Solutia, Inc. -- http://www.solutia.com/-- with its subsidiaries, make and sell a variety of high-performance chemical-based materials used in a broad range of consumer and industrial applications. The Company filed for chapter 11 protection on December 17, 2003 (Bankr. S.D.N.Y. Case No. 03-17949). When the Company filed for protection from their creditors, they listed $2,854,000,000 in assets and $3,223,000,000 in debts. (Solutia Bankruptcy News, Issue No. 19; Bankruptcy Creditors' Service, Inc., 215/945-7000) SPIEGEL INC: Court Authorizes Spiegel Catalog Assets Sale --------------------------------------------------------- Spiegel, Inc. reports that it received no Qualified Overbids for the Spiegel Catalog Assets before the court-approved Bid Deadline. Therefore, no auction was conducted and Spiegel Catalog International is deemed the successful bidder, with its $53.4 million offer. Accordingly, Judge Blackshear authorizes the Debtors to sell the Spiegel Catalog Assets pursuant to the Catalog Stock Purchase Agreement. Headquartered in Downers Grove, Illinois, Spiegel, Inc. -- http://www.spiegel.com/-- is a leading international general merchandise and specialty retailer that offers apparel, home furnishings and other merchandise through catalogs, e-commerce sites and approximately 560 retail stores. The Company filed for Chapter 11 protection on March 17, 2003 (Bankr. S.D.N.Y. Case No. 03-11540). James L. Garrity, Jr., Esq., and Marc B. Hankin, Esq., at Shearman & Sterling represent the Debtors in their restructuring efforts. When the Company filed for protection from its creditors, it listed $1,737,474,862 in assets and 1,706,761,176 in debts. (Spiegel Bankruptcy News, Issue No. 28; Bankruptcy Creditors' Service, Inc., 215/945-7000) UAL CORP: Wants Court to Nix 7 Claims Totaling $700 Million ----------------------------------------------------------- The UAL Corp. Debtors seek to disallow seven claims: Claimant Claim No. Amount -------- --------- ------ Kevin Conboy 3355 $100,000,000 Maric Ladley 3356 100,000,000 Amy Kogen 3357 100,000,000 Joel Kogen 3358 100,000,000 Biju Mathew 3359 100,000,000 Bindu Mathew 3360 100,000,000 Jacqueline Jackson 3361 100,000,000 The Claimants allege that they purchased tickets on United Airlines' flights during July or August 2000 and that they are entitled to $100,000,000 each in relief because their flights were delayed or cancelled, or their baggage was delayed or lost. As a result, the Claimants state that the contract under which they purchased tickets was "illusory" and the Debtors breached the implied terms based on custom and good faith. James H.M. Sprayregen, Esq., at Kirkland & Ellis, tells Judge Wedoff that each of the Claims is identical, repetitive and arises out of a single lawsuit that was filed in the Circuit Court of Cook County, Chancery Division. The lawsuit was dismissed with prejudice by the Honorable Richard A. Siebel more than two years ago. Since the Debtors have been vindicated in this action, the Claimants cannot assert a valid claim, pursuant to Section 502(b)(1) of the Bankruptcy Code. Mr. Sprayregen insists that Judge Wedoff should disallow and expunge the Claims. At a minimum, the Claims should be reduced to a single claim. Headquartered in Chicago, Illinois, UAL Corporation -- http://www.united.com/-- through United Air Lines, Inc., is the holding company for United Airlines -- the world's second largest air carrier. the Company filed for chapter 11 protection on December 9, 2002 (Bankr. N.D. Ill. Case No. 02-48191). James H.M. Sprayregen, Esq., Marc Kieselstein, Esq., David R. Seligman, Esq., and Steven R. Kotarba, Esq., at KIRKLAND & ELLIS represent the Debtors in their restructuring efforts. When the Company filed for protection from their creditors, they listed $24,190,000,000 in assets and $22,787,000,000 in debts. (United Airlines Bankruptcy News, Issue No. 53; Bankruptcy Creditors' Service, Inc., 215/945-7000) STRUCTURED ASSET: Fitch Takes Various Rating Actions ---------------------------------------------------- Fitch Ratings affirms 12 classes of Structured Asset Securities Corp. residential mortgage-backed certificates, as follows: Structured Asset Securities Corp. mortgage pass-through certificates, series 2002-22H group 1: --Class 1A affirmed at 'AAA'; --Class B1-I affirmed at 'AA'; --Class B2-I affirmed at 'A'; --Class B3-I affirmed at 'BBB'; --Class B4-I affirmed at 'BB'; --Class B5-I affirmed at 'B' and removed from Rating Watch Negative. Structured Asset Securities Corp. mortgage pass-through certificates, series 2002-22H group 2: --Class 2A affirmed at 'AAA'; --Class B1-II affirmed at 'AA'; --Class B2-II affirmed at 'A'; --Class B3-II affirmed at 'BBB'; --Class B4-II affirmed at 'BB'; --Class B5-II affirmed at 'B' and removed from Rating Watch Negative. The affirmations reflect credit enhancement consistent with future loss expectations. UNIFLEX: U.S. Trustee Schedules Sec. 341(a) Meeting on August 4 --------------------------------------------------------------- The United States Trustee will convene a meeting of Uniflex, Inc.'s creditors at 2:30 p.m., on August 4, 2004, in Room 2112 at J. Caleb Boggs Federal Building, 2nd Floor, 844 King Street, Wilmington, Delaware 19801. 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 Hicksville, New York, Uniflex, Inc. -- http://www.uniflexbags.com/-- makes custom-printed plastic bags and other plastic packaging for promotions and advertising. The Company filed for chapter 11 protection on June 24, 2004 (Bank. Del. Case No. 04-11852). Peter C. Hughes, Esq., at Dilworth Paxson LLP represents the Debtor in its restructuring efforts. When the Company filed for protection from its creditors, it listed both estimated debts and assets of over $10 million. UNIFLEX: Wants Donlin Recano as Claims, Notice & Ballot Agent ------------------------------------------------------------- Uniflex, Inc., asks the U.S. Bankruptcy Court of Delaware for permission to hire Donlin, Recano & Company, as the official claims, noticing and balloting agent in their chapter 11 proceedings. Donlin Recano will: a) prepare and serve required notices in the Chapter 11 case, including, without limitation: (1) the Section 341(a) Notice; (2) the bar date notice; (3) notice of hearings on a disclosure statement and confirmation of a reorganization plan; and (4) other miscellaneous notices to any entities, as Uniflex or the Court may deem necessary or appropriate for an orderly Chapter 11 case administration; b) within five business days after the mailing of a particular notice, file with the Clerk's Office a declaration of service that includes a copy of the notice involved, an alphabetical list of persons to whom the notice was served and the date and manner of service; c) comply with applicable federal, state, municipal, and local statutes, ordinances, rules, regulations, orders and other requirements; d) promptly comply with the further conditions and requirements as the Clerk's Office or Court may at any time prescribe; e) provide claims recordation services and maintain the official claims register; f) provide balloting and solicitation services, including preparing ballots, producing personalized ballots and tabulating creditor ballots on a daily basis; g) provide other noticing, disbursing and related administrative services as may be required from time to time by Uniflex; and h) provide assistance with, among other things, data processing and ministerial administrative functions, including, at the request of Uniflex, assisting in the preparation of Uniflex's schedules, statements of financial affairs and master creditors lists, and any amendments to the it. Uniflex will pay Donlin Recano an advance retainer of $1,500. Donlin Recano will not charge Uniflex for these services: -- System usage set-up for noticing and docketing; -- Data input through tape conversion in Donlin Recano format; -- Website access; -- Document handling and document custody; -- Notices set-up; and -- Report formatting/set-up. Donlin Recano will charge the Debtors for its notice and docketing services at these rates: Services Rates -------- ----- A. System Usage 1. Database Maintenance/Storage $200 per month 2. Data Input Tape conversion Other Formats $125 per hour B. Claims docketing/Support Services 1. Client Data Entry (pre-coded) $35 per hour Data Entry (uncoded) $60 per hour Headquartered in Hicksville, New York, Uniflex Inc. -- http://www.uniflexbags.com/-- makes custom-printed plastic bags and other plastic packaging for promotions and advertising. Uniflex filed for chapter 11 protection on June 24, 2004 (Bankr. Del. Case No. 04-11852). Peter C. Hughes, Esq., at Dilworth Paxson LLP, represents the Debtor. When the Company filed for protection from its creditors, it listed estimated debts and assets of more than $10 million. WASHINGTON MUTUAL: Fitch Affirms Low-B Ratings of 6 Classes ----------------------------------------------------------- Washington Mutual Asset Securities Corporation commercial mortgage pass-through certificates, series 2003-C1, are affirmed by Fitch Ratings as follows: --$458.9 million class A at 'AAA'; --Interest-only class X-1 at 'AAA'; --$11.4 million class B at 'AA'; --$2.9 million class C at 'AA-'; --$12.9 million class D at 'A'; --$2.9 million class E at 'A-'; --$4.3 million class F at 'BBB+'; --$5.7 million class G at 'BBB'; --$2.9 million class H at 'BBB-'; --$5.7 million class J at 'BB+'; --$4.3 million class K at 'BB'; --$1.4 million class L at 'BB-'; --$2.9 million class M at 'B+'; --$2.9 million class N at 'B'; --$1.4 million class O at 'B-'. Fitch does not rate the $5.7 million class P certificates. The rating affirmations follow Fitch's review of the transaction, which closed in March 2003. As of the June 2004 distribution date, the pool's aggregate certificate balance has decreased 8.0% to $526.1 million from $571.9 million at issuance. One loan (0.69%) secured by a multifamily property located in Charlotte, NC is in special servicing and is currently 90 days delinquent. The property has experienced a decline in performance since issuance. A resolution is currently being discussed with the borrower; no losses are expected on the loan. WASTECORP.: Delays Filing of Financial Statements ------------------------------------------------ Wastecorp. International Investments Inc. (TSX Venture: WII) announces that it will be unable to file its audited financial results for the fiscal period ending February 29, 2004, by July 16, 2004, the date required for filing under Policy 57-603 of the Securities Act. The preparation and filing of the financial statements has been delayed as a result of the considerable and lengthy preparation time of the company's draft disclosure statement and preliminary plan of reorganization, and various Court approvals respecting administrative commitments amongst other things. Furthermore, Wastecorp. anticipates filing the audited financial statements and the interim first quarter financial statements the sooner of September 15, 2004. On April 7, 2003, Wastecorp. International Investments Inc., together with its subsidiary, Wastecorp. Inc., filed voluntary petitions for reorganization pursuant to Chapter 11 of the US Bankruptcy Code in the United States, Bankruptcy Court in the District of New Jersey. At this time, Wastecorp. are under the joint administration of the Bankruptcy Court for the District of New Jersey, pursuant to the Order dated April 10, 2003. Wastecorp. is represented in Canada by Borden, Ladner, Gervais, and in the United States by Cole, Schotz, Meisel, Forman & Leonard. As a result of the late filing of the financial statements, as required under the Securities Act, Wastecorp.'s securities may be subject to a cease trading order affecting certain members of management, as well as insiders of Wastecorp. If Wastecorp. does not file its financial statements, pursuant to Ontario Securities Commission Policy 57-603, by September 15, 2004, then a cease trade order may be issued affecting all of Wastecorp.'s shareholders. In this connection, Wastecorp. intends to fully comply with the provisions of the alternate guidelines until it has satisfied its financial reporting requirements with the OSC throughout the period in which it is in default, and with any and all information to be provided the Bankruptcy Court and in the same manner as it would file a material change report, pursuant to the Securities Act. On May 12, 2004, Wastecorp. filed a preliminary disclosure statement, as requested by US Bankruptcy Court - District of New Jersey. The US Bankruptcy Court - District of New Jersey has extended the exclusivity period in which to file a plan of reorganization to July 30, 2004, and the exclusivity period during which to solicit acceptances has also been extended to September 28, 2004. As at this date, Wastecorp. cannot comment on the outcome. Wastecorp. Inc., headquarted in Glen Rock, New Jersey, is a waste management company specializing in wastewater sewage treatment with its Wastecorp. Marlow Plunger Pump line, medical waste disposal, with its reusable sharps conainer program and plastic and scrap tire recycling division. WEIRTON STEEL: Fair Harbor Offers 42% for Administrative Claims --------------------------------------------------------------- Fair Harbor Capital, LLC, is offering creditors holding administrative claims against Weirton Steel Corporation, and its debtor-affiliates, 42 cents-on-the-dollar in cash. The claim purchaser's offer expires July 23, 2004, is on a first-come, first-served basis, and is subject to due diligence and acceptable documentation. For additional information, contact: Joseph Grand Fair Harbor Capital, LLC 875 Avenue of the Americas, Suite 2305 New York, NY 10001 Telephone (212) 967-4035 Fax (212) 976-4148 Weirton sent letters to roughly 500 administrative claimants owed $8.2 million in late June offering, subject to Bankruptcy Court approval, to pay 50 cents-on-the-dollar on account of administrative priority obligations not assumed by International Steel Group. Weirton indicated in his June correspondence to Weirton Administrative Claimants that it will take three to four months to determine whether or not Weirton's estate is administratively solvent. Weirton's 50% offer expired by its own terms on July 1, 2004. The contact person for the 50% offer is: Robert C. Fletcher Authorized Agent Weirton Steel Corporation 400 Three Springs Drive Weirton, WV 26062 Telephone (304) 797-2000 WILSONS LEATHER: Repurchases & Cancels $22M of 11-1/4% Sr. Notes ---------------------------------------------------------------- Wilsons The Leather Experts Inc. (Nasdaq:WLSN) repurchased and cancelled $22.0 million 11-1/4% Senior Notes due August 15, 2004. This repurchase reduces the total amount of the 11-1/4% Senior Notes to $8.6 million outstanding. About Wilsons Leather Wilsons Leather is the leading specialty retailer of leather outerwear, accessories and apparel in the United States. As of May 29, 2004, Wilsons Leather operated 457 stores located in 45 states and the District of Columbia, including 332 mall stores, 108 outlet stores and 17 airport stores. The Company regularly supplements its permanent mall stores with seasonal stores during its peak selling season from October through January. * * * In its Form 10-Q for the quarterly period ended May 1, 2004, Wilsons the Leather Experts Inc. reports: "The Company currently does not have the funds to pay the outstanding principal amount of the 11 1/4% Senior Notes when they are due on August 15, 2004. The senior credit facility prohibits the Company from incurring any indebtedness which refunds, renews, extends or refinances the 11 1/4% Senior Notes on terms more burdensome than the current terms of such notes, and the rate of interest with respect to any replacement notes cannot exceed the sum of the rate of interest on United States treasury obligations of like tenor at the time of such refunding, renewal, extension or refinancing, plus 7.0% per annum. The Company anticipates that it will not be able to refund, renew, extend or refinance the 11 1/4% Senior Notes with indebtedness that would comply with such limitations. However, if the Company completes a sale of its capital stock by August 15, 2004, on terms that are acceptable to the lenders under the senior credit facility, such lenders have agreed that the Company may use the proceeds from such sale to pay the 11 1/4% Senior Notes. The lenders have agreed that the terms of the Equity Financing if consummated, would be acceptable for this purpose. If the Company is unable to close the Equity Financing for any reason, it will need to find an alternative source of permitted financing for the repayment of the 11 1/4% Senior Notes before it will be permitted to borrow under the senior credit facility. The Company anticipates that it will need to access the revolving portion of the senior credit facility by the middle of July 2004." WMF PROPERTIES: Case Summary & 3 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: WMF Properties, Inc. 1025 South Atlantic Avenue Daytona Beach, Florida 32118 Bankruptcy Case No.: 04-06808 Chapter 11 Petition Date: July 2, 2004 Court: Middle District of Florida (Jacksonville) Judge: Jerry A. Funk Debtor's Counsel: John S. Norton, Jr., Esq. John S. Norton, Jr., P.A. 431 North Grandview Avenue, Suite B Daytona Beach, FL 32818 Tel: 386-239-0770 Fax: 386-254-3190 Estimated Assets: $1 Million to $10 Million Estimated Debts: $1 Million to $10 Million Debtor's 3 Largest Unsecured Creditors: Entity Nature Of Claim Claim Amount ------ --------------- ------------ Thyssenkrupp Elevator Equipment Purchase $30,000 Nations Rent Equipment Rental $16,000 Wachovia Bank Credit Card Debt $8,000 * Large Companies with Insolvent Balance Sheets ----------------------------------------------- Total Shareholders Total Working Equity Assets Capital Company Ticker ($MM) ($MM) ($MM) ------- ------ ------------ ------- -------- Airgate PCS PCSA (377) 291 13 Alliance Imaging AIQ (68) 628 20 Akamai Technologies AKAM (175) 279 140 Amazon.com AMZN (1,036) 2,162 568 Bally Total Fitness BFT (158) 1,453 (284) Blount International BLT (397) 400 83 Blue Nile Inc. NILE (27) 62 16 Cell Therapeutic CTIC (83) 146 72 Centennial Comm CYCL (579) 1,447 (99) Choice Hotels CHH (118) 267 (42) Cincinnati Bell CBB (640) 2,074 (47) Compass Minerals CMP (144) 687 106 Cubist Pharmaceuticals CBST (18) 223 91 Delta Air Lines DAL (384) 26,356 (1,657) Deluxe Corp DLX (298) 563 (309) Echostar Comm DISH (1,033) 7,585 1,601 WR Grace & Co GRA (184) 2,874 658 Graftech International GTI (97) 967 94 Hawaian Holdings HA (143) 256 (114) Imax Corporation IMAX (52) 250 47 Imclone Systems IMCL (271) 382 (3) Kinetic Concepts KCI (246) 665 228 Lodgenet Entertainment LNET (129) 283 (6) Lucent Technologies LU (3,371) 15,765 2,818 Maxxam INC MXM (601) 1,061 127 Memberworks Inc. MBRS (20) 248 (89) Millennium Chem. MCH (46) 2,398 637 McDermott International MDR (363) 1,249 (24) McMoRan Exploration MMR (54) 169 83 Milacron Inc MZ (34) 712 17 Northwest Airlines NWAC (1,775) 14,154 (297) Nextel Partner NXTP (13) 1,889 277 ON Semiconductor ONNN (499) 1,161 213 Paxson Communications PAX (406) 1,284 67 Pinnacle Airline PNCL (48) 128 13 Primus Telecomm PRTL (96) 751 (26) Per-Se Tech Inc. PSTI (18) 172 41 Qwest Communications Q (1,016) 26,216 (1,132) Quality Distributors QLTY (19) 371 7 Sepracor Inc SEPR (619) 1,020 256 St. John Knits Int'l SJKI (65) 234 69 I-Stat Corporation STAT (1) 64 33 Stratagene Corp. STGN (5) 39 9 Syntroleum Corp. SYNM (12) 67 11 UST Inc. UST (115) 1,726 727 Valence Tech VLNC (52) 21 (5) Vector Group Ltd. VGR (3) 628 142 Western Wireless WWCA (225) 2,522 15 ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers' public debt and equity securities about which we report. Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than $3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. A list of Meetings, Conferences and Seminars appears in each Wednesday's edition of the TCR. Submissions about insolvency- related conferences are encouraged. Send announcements to conferences@bankrupt.com. Each Friday's edition of the TCR includes a review about a book of interest to troubled company professionals. All titles are available at your local bookstore or through Amazon.com. Go to http://www.bankrupt.com/books/to order any title today. Monthly Operating Reports are summarized in every Saturday edition of the TCR. For copies of court documents filed in the District of Delaware, please contact Vito at Parcels, Inc., at 302-658-9911. For bankruptcy documents filed in cases pending outside the District of Delaware, contact Ken Troubh at Nationwide Research & Consulting at 207/791-2852. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter is a daily newsletter co-published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland USA. Yvonne L. Metzler, Bernadette C. de Roda, Rizande B. Delos Santos, Paulo Jose A. Solana, Jazel P. Laureno, Aileen M. Quijano and Peter A. Chapman, Editors. Copyright 2004. All rights reserved. ISSN: 1520-9474. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR subscription rate is $675 for 6 months delivered via e- mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Christopher Beard at 240/629-3300. *** End of Transmission ***